A brand is essentially the image and personality of a product or service that a business provides.
It is characterized as being the features (logos or slogans) that make a product unique and different.
Branding was originally used hundreds of years ago to differentiate cattle. Cattle ranchers used branding irons to burn symbols on their livestock so that slaughter houses could identify which ranch the cattle came from. They also branded their livestock so that they would be easier to find if they were stolen.
Apple is by far the world’s most valuable brand. (Image data source: Forbes)
But brands are now more than just a means of differentiating products, they also convey a “promise” that the product the consumer buys will meet the standards the manufacturer seeks to deliver.
Brands are intangible reputational assets that are often the most valuable asset of a corporation. Intangibles are assets you cannot touch, they have no physical form, but are valuable for the company.
Why is branding important?
Quality branding can result in higher sales of a product, as well as other products that are associated with the brand.
A good example would be someone who enjoys Coca-Cola trying other soft drinks by the company (such as Sprite). The positive brand image of Coca-Cola helps drive a consumer to another product by the Coca-Cola company.
The psychology behind branding
Brands have a psychological aspect as well as an experiential aspect.
In a nutshell, the brand experience includes “all the interactions people have with a product, service, or organization; the raw material of a brand”, according to Marty Neumeier, Director of Transformation at Liquid Agency Inc.
Brand image is simply a consumers’ perception of a brand. But it doesn’t only provide a mental image for the consumer, it also provides emotional value. For example, the automobile manufacturer Volvo is well known for its safety while Ferrari is famous for being sporty. A positive brand image can do wonders for a company.
Establishing a brand
When a brand has developed a high degree of popularity, or it has become well known, then it has brand recognition.
Brand recognition can grow (increasing in popularity) until it becomes a brand franchise.
Having brand recognition means that you are on people’s radar. How can a brand improve its recognition? By increasing brand awareness.
Brands want people to know they exist and expand their reach. This can be achieved through advertising, word-of-mouth, and engagement in the community.
Once a brand has proved itself in the market it wants customers to return – by providing a compelling brand experience.
If all this can be achieved in a sustainable way and consumers are kept satisfied, a sense of brand loyalty can then be nurtured.
Brand management is the marketing technique that aims to improve the reputation of a brand or product.
The ultimate goal – brand loyalty
Any brand in the market wants its consumers to come back on a regular basis to buy their products.
Brand loyalty is defined by The American Marketing Association as “the situation in which a consumer generally buys the same manufacturer-originated product or service repeatedly over time rather than buying from multiple suppliers within the category.”
Brand loyalty can be achieved if companies prove to their consumers that their priorities include maintaining individual customer relationships.
The most valuable brands in the world
Video – What is a Brand?