Branding – Definition and Theories
A brand is a construction consumers make of a product/service. The teams behind products/services aim to position them as good as possible in the minds of their targeted customers. In this respect, they attribute their specific product or service certain elements of identifications. Such identification elements are: a name, a symbol (for instance a trademark, a logo, a sign, or a package design), a color or a feeling (Aaker, 1991, p.7).
“A brand is an asset of differentiating promises that links a product to its customers” (Stuart Agres, Young & Rubicam in Fombrun, 2007, p.232).
Based on an experiment conducted by Young & Rubicam for identifying the key success of a brand, there were identified four pillars that predicted the brands’ value:
- differentiation or uniqueness;
- relevance or how the brand answered the customers’ needs;
- esteem or how much do customers admire the brand;
- familiarity of how is the brand integrated in the consumer’s daily life (Fombrun, 2007, p. 232).
Studying brands and branding, Clifton concludes, based on previous conducted research that brands are intrinsically striking, having the purpose of creating an “indelible impression” and they succeed in doing so by a distinctive visual approach, through combining, “name, letters, numbers, a symbol, a signature, a shape, a slogan, a color, a particular typeface” (2010, p. 12).
The name of the brand is significant, but for the brand to be relevant on its market, it has to be completely aligned with the product’s business strategy and to build strong and long lasting relationships (Kotler & Pfoertsh, 2006, p. 149).
Purposes of Branding in Business
Building a brand implies consistent efforts, but maintaining it is where the real challenge is. In this respect, scholars consider that brands are the essence of companies, because through brands enterprises aim to create long – term intangible assets, ensuring the success of the company on the long run. Business exist because of strong brands and not the other way around as Kotler and Pfoertsch consider (2006, p. 51).
The purpose of branding is to create trademarks that will emphasize the value of the product, allowing the company who owns specific brands to control how much its product/service will cost and how it will be positioned (Douglas, n.d., slide 4).
Therefore, brands’ purpose is to create and consolidate solid partnerships between consumers and the company who sells certain products under a certain brand. For the company, a brands’ purpose is to strengthen its business, optimizing and capitalizing it based on the recognition, awareness, popularity and consumers’ familiarity with the brand, while for the consumers, the purpose of the brand is to enter their everyday life, to represent their choice in the shopping basket and to search for it on the supermarket shields, between other similar products.
The purpose of branding, other scholars consider, is to create a positive halo with which the consumers to associate themselves (Fombrun, 2011, p. 117), generating a favorable impression over what the brand promises, so that the customers to expect the brand to answer their needs.
Advantages and Disadvantages of Branding
First, let’s talk about disadvantages. When building a brand there are considerable efforts that should be aligned, inclusive financial efforts, therefore, branding costs.
Maintaining a brand also implies costs, not solely from the brand owner’s side, but also from the consumers’ side, who borne the cost of its awareness, popularity, reputation and familiarity (Douglas, slide 5).
When there are just too many brands on the shields of the store, promising similar things in terms of quality and satisfying the customers’ needs, the customers might get confused, not knowing what they should throw in their shopping basket.
On the other hand, being completely loyal to a brand, consumers might miss significant opportunities to discover new brands, or brands with improved features in terms of quality, price – or promotional advantages, as many brands apply various merchandising strategies, such as the bundle package, for instance.
Another fact that must be considered when discussing about the disadvantages of branding is that in time, brands tend to deteriorate, because manufacturers stop paying too much attention on the quality of the product, focused on mass commercialization (Jayne, 2009/10, p, 237).
Discussing about the advantages of the branding, there are immediate aspects that we can think of, concerning both the company who owns the brand and the consumers. Who does not need long lasting commitment and loyalty from the consumers’ side? A strong relationship between the consumer and his brand of choice means continuous sales for the manufacturer. Moreover, having a strong brand, well positioned, leads to increasing its market share, as it enters the consumers everyday use (becoming familiar) and it achieves awareness. Benefiting of these advantages, the brand can also set its positioning on the market, according to the company’s business strategy.
Brand leads to brand equity, meaning that the brand itself will worth, having financial potential to be franchised, for instance, or to obtain social advantages, because of its reputation.
For consumers, a strong and well – defined brand induces convenience, as it facilitates their process of selecting products. Not wasting time on comparing products, the consumers simply select a brand in relation to its reputation.
Brands talk to consumers, representing what they need to express. Brands set statements, talking about the emotional connection between the shopper and his product of choice. Consumers buy a certain product for what it stands for and by using it, they associate the qualities of the brand with themselves (Floor, 2006, pp. 50 - 51).
Implications of changing a brand
The process of creating a brand is long lasting, challenging and it implies commitment into creating associations with the brand in the customers’ minds and in developing its awareness and a strong relation between consumers and the brand. Changing brand means rethinking its name, redesigning its logo and the graphic elements and reproducing identification assets that will generate new associations in the consumers’ minds. In other words, changing a brand implies rebuilding the whole branding process (Muzellec & Lambkin, 2008, p. 283).
Changing a brand signifies passing through the same processes of building the brand, which means time and money, but also continuous efforts and involvement for repositioning the brand. In fact, rebranding involves a repositioning of the brand, but more about this aspect will be discussed very soon.
When changing a brand, companies must bear in mind the fact that all the advertising and promotional materials must be changed. The entire visual identity that defines the brand must be adapted to the new changes into all the advertisement channels, where the brand is positioned will suffer changes: online (website, online banners, etc.); print, radio & television (commercials), and physic place (visual identity of stores, repositioning within the stores, uniforms, printed materials, etc.). All these are meant as an official statement, for changing the company’s business strategy. The brand only follows the new direction that the company adopts (Muzellec & Lambkin, 2005, p. 807).
Considering the repositioning of the brand (hence of the company’s business) as the reason of the rebranding, there must also be taken into consideration the fact that the brand might compete on a new market, competing for a new market share (Muzellec & Lambkin, 2005, p. 809). This might impact the customer’s revenues on a short or long term period. Repositioning implies aiming for a new market. This signifies losing the former loyal customers and aiming to create other loyal customers, or to gain back the former loyal customers as well. But this process takes time and during this time the company’s revenues are affected.
When a company decides to change its brand through a rebranding process, the graphic elements, logo maybe even the name of the brand will change into new ones. The task of the marketers will be to determine the customers to find new features of association with the new brand. In the meantime, the change will confuse the consumers, who will not be able to identify the features of the previous brand into the new one, losing the connection with their preferred brand.
On the other hand, we should remember that rebranding implies repositioning, which means addressing to another category of consumers. Therefore, rebranding might attract new customers, but they also will have to identify features in the new brand with which they should create associations in their minds. It will be the responsibility of the marketers to create new associations with which the consumers to connect and to develop a relation, preferable a long lasting relation and to win the reputation and awareness for the new brand (Muzellec & Lambkin, 2005, p. 809).
When brand changes but is not rebranding the phenomenon is called brand evolution, and it implies small changes made on the original brand. Brand evolution also implies the alignment with the company’s corporate identity (Kotler & Pfoertsch, 2006, p. 51), but in this case the company’s objective is to refresh the brand, to modernize it and bring it on the new edge of the market’s evolution, rather than setting a statement about corporate changes. Likewise, brand evolution might solely imply simplifying the band’s visual identity (how it looks) or its message (what it says).
Of course, when changing a brand with the purpose of modernizing it, this also implies changing the corporate materials, so that the new brand (with the new logo, graphics, message or slogan) to appear changed on all the materials in all the environments where it is distributed: online, print, TV, radio or physically. Nevertheless, with all the changes implemented, the value of recognition of the brand stays, meaning that consumers will still associate the brand with its original qualities and its awareness will be maintained (Whitebread, 2009, p. 78).
How Well Known Brands Affect Other New Businesses
When a new brand enters a market, where there are already well known brands activating, the new entry will have to face the challenges imposed by the competing forces on that market. A new business means new competition for the market share. The new entry brands will have to adjust to the situation adopted by the market on which they entry, which is new for them. Like this, the big brands activating on that market have a significant impact as they have the strength to set the quality standards and the regular costs per product/service. For a balanced competition, the brands activating on the same market will have similar prices.
This will signify that the new business will have to accommodate their brands (prices included) on the ones practiced by the big brands and they will have to comply with the quality standards imposed on the market by the big players.
Nonetheless, the new entries can apply some branding strategies for gaining competitive advantage, through which they should differentiate their product, indicating the unique qualities of the products sold, through the brand’s identity (Scott, 2008, p. 157).
Process of Branding Strategy
The process of branding strategy should imply internal and external focus. The internal focus should be on fixed and variable assets. In terms of fixed assets, the company must consider the brand’s vision (what should the brand become?) and in terms of variable assets the company should consider the brand delivery (how will the company fulfill its commitment and through what actions by employing the brand?)
The external focus is also positioned on fixed and variable assets, wherein the fixed assets refer to the brand promise (the commitment to the client) and the variable assets refer to the brand positioning (how the brand will be perceived and what will be its competitive advantages).
In the process of building a brand, one must refer to the brand’s name, logo, slogan and other messages, which will be aligned to the business strategy. But this is not all there is to branding. Brand’s commitment and promise should be permanently restated and for this is required constant involvement. Website, newsletters, business forms, signage, packaging, exhibits, proposals, emails, voice mails, publications, web banners, letterheads, business cards, billboards, services, products, employees, presentations, networking, word of mouth, trade shows, direct mail, public affairs, civic marketing, sales promotions, advertising or experiences – these items are just a few of the ingredients of a successful brand. The correct integration of all these items might bring a brand in the top ten most profitable brands on its market.
When a rebranding process intervenes, the process of rebranding strategy must follow the same stages as the branding strategy process, adapted on the changes that the company intends for its business. When a reposition is required, a new identity should be designed, with a new logo, graphic representations, color or name may also require change, in order for the company to completely change the original brand’s assets. When changing the brand for the brand evolution purpose, the brand maintains its colors, its name, something of its logo, only certain aspects change, for making the brand more modern, as it was previously stated.
This is an example of the distinction between rebranding and branding evolution, both imply change, but while British Petroleum redesigned its logo entirely, making it more environmental friendly (see the connection with the sun – which implies the company’s statement for sustaining the environment through ecological projects after the Deep Horizon Oil Spill from the Gulf of Mexico accident that completely affected its image), ebay solely changed the way its letters are designed. No major change here, no statement, just a pointing about the trademark and a simpler approach. With this I have reached the end of my presentation. I would like to thank you for your attention!
References
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