brand

A brand is a product, service, or concept that is publicly distinguished from other products, services, or concepts so that it can be easily communicated and usually marketed. A brand name is the name of the distinctive product, service, or concept. Branding is the process of creating and disseminating the brand name. Branding can be applied to the entire corporate identity as well as to individual product and service names.

Brands are usually protected from use by others by securing a trademark or service mark from an authorized agency, usually a government agency. Before applying for a trademark or service mark, you need to establish that someone else hasn't already obtained one for your name. Although you can do the searching yourself, it is common to hire a law firm that specializes in doing trademark searches and managing the application process, which, in the United States, takes about a year. Once you've learned that no one else is using it, you can begin to use your brand name as a trademark simply by stating it is a trademark (using the " TM " where it first appears in a publication or Web site). After you receive the trademark, you can use the registered (?) symbol after your trademark.

Brands are often expressed in the form of logos , graphic representations of the brand. In computers, a recent example of widespread brand application was the "Intel Inside" label provided to manufacturers that use Intel's microchips.

A company's brands and the public's awareness of them is often used as a factor in evaluating a company. Corporations sometimes hire market research firms to study public recognition of brand names as well as attitudes toward the brands.

Here is the famous advertising copywriter and ad agency founder David Ogilvy's definition of a brand:

The intangible sum of a product's attributes: its name, packaging, and price, its history, its reputation, and the way it's advertised.

Take a look at the list below that shows the world’s top 10 brands in 2002 (as measured by value):

{Rank Brand Value ($ billions)}

1 Coca-Cola ($69.6)

2 Microsoft ($64.1)

3 IBM ($51.2)

4 GE ($41.3)

5 Intel ($30.9)

6 Nokia ($30.0)

7 Disney ($29.3)

8 McDonalds ($26.4)

9 Marlboro ($24.2)

10 Mercedes ($21.0)

Source: Interbrand; JP Morgan Chase, 2002

Why do companies such as Coca-Cola, Microsoft, IBM and Disney seem to achieve global marketing success so easily? Why does it seem such an effort for others?

Why do we, as consumers, feel loyal to such brands that the mere sight of their logo has us reaching into our pockets to buy their products?

The meaning of brands

Brands are a means of differentiating a company’s products and services from those of itscompetitors.

There is plenty of evidence to prove that customers will pay a substantial price premium for a good brand and remain loyal to that brand. It is important, therefore, to understand what brands are and why they are important.

Macdonald sums this up nicely in the following quote emphasising the importance of brands:

“…it is not factories that make profits, but relationships with customers, and it is company and brand names which secure those relationships”

Businesses that invest in and sustain leading brands prosper whereas those that fail are left to fight for the lower profits available in commodity markets.

What is a brand?

One definition of a brand is as follows:

“A name, term, sign, symbol or design, or a combination of these, that is intended to identify the goods and services of one business or group of businesses and to differentiate them from those of competitors”.

Interbrand - a leading branding consultancy - define a brand in this way:

“A mixture of tangible and intangible attributes symbolised in a trademark, which, if properly managed, creates influence and generates value”.

Three other important terms relating to brands should be defined at this stage:

Brand equity

“Brand equity” refers to the value of a brand. Brand equity is based on the extent to which the brand has high brand loyalty, name awareness, perceived quality and strong product associations. Brand equity also includes other “intangible” assets such as patents, trademarks and channel relationships.

Brand image

“Brand image” refers to the set of beliefs that customers hold about a particular brand. These are important to develop well since a negative brand image can be very difficult to shake off.

Brand extension

“Brand extension” refers to the use of a successful brand name to launch a new or modified product in a new market. Virgin is perhaps the best example of how brand extension can be applied into quite diverse and distinct markets.

Brands and products

Brands are rarely developed in isolation. They normally fall within a business’ product line or product group.

A product line is a group of brands that are closely related in terms of their functions and the benefits they provide. A good example would be the range of desktop and laptop computers manufactured by Dell.

A product mix relates to the total set of brands marketed by a business. A product mix could, therefore, contain several or many product lines. The width of the product mix can be measured by the number of product lines that a business offers.

For a good example, visit the web site of Hewlett-Packard (“HP”). HP has a broad product mix that covers many segments of the personal and business computing market. How many separate product lines can you spot from their web site?

Managing brands is a key part of the product strategy of any business, particularly those operating in highly competitive consumer markets.

From Wikipedia, the free encyclopedia

A brand is the identity of a specific product, service, or business[1][page needed]. A brand can take many forms, including a name, sign, symbol, color combination orslogan. The word brand began simply as a way to tell one person's cattle from another by means of a hot iron stamp. A legally protected brand name is called atrademark. The word brand has continued to evolve to encompass identity - it affects the personality of a product, company or service.

A concept brand is a brand that is associated with an abstract concept, like breast cancer awareness or environmentalism, rather than a specific product, service, or business. A commodity brand is a brand associated with a commodity. Got milk? is an example of a commodity brand.

Brand is the personality that identifies a product, service or company (name, term, sign, symbol, or design, or combination of them) and how it relates to key constituencies: Customers, Staff, Partners, Investors etc.

Some people distinguish the psychological aspect, brand associations like thoughts, feelings, perceptions, images, experiences, beliefs, attitudes, and so on that become linked to the brand, of a brand from the experiential aspect.

The experiential aspect consists of the sum of all points of contact with the brand and is known as the brand experience. The psychological aspect, sometimes referred to as the brand image, is a symbolic construct created within the minds of people, consisting of all the information and expectations associated with a product, service or the company(ies) providing them.

People engaged in branding seek to develop or align the expectations behind the brand experience, creating the impression that a brand associated with a product or service has certain qualities or characteristics that make it special or unique. A brand is therefore one of the most valuable elements in an advertising theme, as it demonstrates what the brand owner is able to offer in the marketplace. The art of creating and maintaining a brand is called brand management. Orientation of the whole organization towards its brand is called brand orientation.

Careful brand management seeks to make the product or services relevant to the target audience. Brands should be seen as more than the difference between the actual cost of a product and its selling price - they represent the sum of all valuable qualities of a product to the consumer. There are many intangibles involved in business, intangibles left wholly from the income statement and balance sheet which determine how a business is perceived. The learned skill of a knowledge worker, the type of mental working, the type of stitch: all may be without an 'accounting cost' but for those who truly know the product, for it is these people the company should wish to find and keep, the difference is incomparable.

A brand which is widely known in the marketplace acquires brand recognition. When brand recognition builds up to a point where a brand enjoys a critical mass of positive sentiment in the marketplace, it is said to have achieved brand franchise. One goal in brand recognition is the identification of a brand without the name of the company present. For example, Disney has been successful at branding with their particular script font (originally created for Walt Disney's "signature" logo), which it used in the logo for go.com.

Consumers may look on branding as an important value added aspect of products or services, as it often serves to denote a certain attractive quality or characteristic (see also brand promise). From the perspective of brand owners, branded products or services also command higher prices. Where two products resemble each other, but one of the products has no associated branding (such as a generic, store-branded product), people may often select the more expensive branded product on the basis of the quality of the brand or the reputation of the brand owner.

[edit]Brand awareness

Brand awareness refers to customers' ability to recall and recognize the brand under different conditions and link to the brand name, logo, jingles and so on to certain associations in memory. It helps the customers to understand to which product or service category the particular brand belongs and what products and services are sold under the brand name. It also ensures that customers know which of their needs are satisfied by the brand through its products (Keller). Brand awareness is of critical importance since customers will not consider your brand if they are not aware of it.[3]

'Brand love', or love of a brand, is an emerging term encompassing the perceived value of the brand image. Brand love levels are measured through social media posts about a brand, or tweets on sites such as Twitter. Becoming a Facebook fan of a particular brand is also a measurement of the level of 'brand love'.

[edit]Brand promise

The marketer and owner of the brand has a vision of what the brand must be and do for the consumers.[4]

Brand promise is what a particular brand stands for (and has stood for in the past). It has its roots from the identity that it gains over a period of time. Usually, brand promise is an attribute common to 'Parent' brands. Herein, the brand may broadly stand for Quality, Performance, Trust, or False promises. However, the extensions, or the brands under the parent brand umbrella, may stand individually for a particular trait which it has delivered over the years, for example, 'the best sparkling teeth', or 'the trusted bank to bank with for centuries', et al.

[edit]Global brand

A global brand is one which is perceived to reflect the same set of values around the world. Global brands transcend their origins and create strong enduring relationships with consumers across countries and cultures. They are brands sold in international markets. Examples of global brands include Facebook, Apple, Coca-Cola, McDonald's, Mastercard, Gap and Sony. These brands are used to sell the same product across multiple markets and could be considered successful to the extent that the associated products are easily recognizable by the diverse set of consumers.

[edit]Benefits of global branding

In addition to taking advantage of the outstanding growth opportunities, the following drives the increasing interest in taking brands global:

§  Economies of scale (production and distribution)

§  Lower marketing costs

§  Laying the groundwork for future extensions worldwide

§  Maintaining consistent brand imagery

§  Quicker identification and integration of innovations (discovered worldwide)

§  Preempting international competitors from entering domestic markets or locking you out of other geographic markets

§  Increasing international media reach (especially with the explosion of the Internet) is an enabler

§  Increases in international business and tourism are also enablers

[edit]Global brand variables

The following elements may differ from country to country:

§  Corporate slogan

§  Products and services

§  Product names

§  Product features

§  Positionings

§  Marketing mixes (including pricing, distribution, media and advertising execution)

These differences will depend upon:

§  Language differences

§  Different styles of communication

§  Other cultural differences

§  Differences in category and brand development

§  Different consumption patterns

§  Different competitive sets and marketplace conditions

§  Different legal and regulatory environments

§  Different national approaches to marketing (media, pricing, distribution, etc.)

[edit]Local brand

A brand that is sold and marketed (distributed and promoted) in a relatively small and restricted geographical area. A local brand is a brand that can be found in only one country or region. It may be called a regional brand if the area encompasses more than one metropolitan market. It may also be a brand that is developed for a specific national market, however an interesting thing about local brand is that the local branding is more often done by consumers than by the producers. Examples of local brands in Sweden are Stomatol, Mijerierna etc.[5] [6]

[edit]Ambient brand

An ambient brand is a movement, where the brand is organized around values and social needs instead of promoting a specific product. It is a virtual space, defined by values and occupied by a community of like minded people. Whereas a traditional brand is entirely dependent on products and their parent corporations, an ambient brand is an independent social movement that companies can participate in. They are not selling products, they are allowing their company to participate in a social movement and allow their brand to be identified with this. It exists as a shared values space where consumers gather, converse and ultimately transact with organizations that appear to be in alignment with the values associated with that community. Corporations do not create ambient brands. They must qualify for inclusion within them by demonstrating that they share the values and will service the interests of their associated communities. The brands develop organically as a result of emerging social and cultural codes and are materialized through peoples ability to organize around them through the use of mainly virtual communities on the web. The term as it is defined here was coined by Sara Batterby, a brand strategist in San Francisco and was used in an interview on the importance of successful destination branding with Bjørn Frode Moen

[edit]Brand name

Relationship between trade marks and brand

The brand name is quite often used interchangeably with "brand", although it is more correctly used to specifically denote written or spoken linguistic elements of any product. In this context a "brand name" constitutes a type of trademark, if the brand name exclusively identifies the brand owner as the commercial source of products or services. A brand owner may seek to protect proprietary rights in relation to a brand name through trademark registration. Advertising spokespersons have also become part of some brands, for example: Mr. Whipple of Charmin toilet tissue and Tony the Tiger of Kellogg's Frosted Flakes. Local branding is usually done by the consumers rather than the producers.

[edit]Types of brand names

Brand names come in many styles.[7] A few include:

Acronym: A name made of initials such as UPS or IBM

Descriptive: Names that describe a product benefit or function like Whole Foods or Airbus

Alliteration and rhyme: Names that are fun to say and stick in the mind like Reese's Pieces or Dunkin' Donuts

Evocative: Names that evoke a relevant vivid image like Amazon or Crest

Neologisms: Completely made-up words like Wii or Kodak

Foreign word: Adoption of a word from another language like Volvo or Samsung

Founders' names: Using the names of real people,and founder's name like Hewlett-Packard or Disney

Geography: Many brands are named for regions and landmarks like Cisco and Fuji Film

Personification: Many brands take their names from myth like Nike or from the minds of ad execs like Betty Crocker

The act of associating a product or service with a brand has become part of pop culture. Most products have some kind of brand identity, from common table salt todesigner jeans. A brandnomer is a brand name that has colloquially become a generic term for a product or service, such as Band-Aid or Kleenex, which are often used to describe any brand of adhesive bandage or any brand of facial tissue respectively.

[edit]Brand identity

The outward expression of a brand, including its name, trademark, communications, and visual appearance.[8] Because the identity is assembled by the brand owner, it reflects how the owner wants the consumer to perceive the brand - and by extension the branded company, organization, product or service. This is in contrast to the brand image, which is a customer's mental picture of a brand.[8] The brand owner will seek to bridge the gap between the brand image and the brand identity.

Effective brand names build a connection between the brand personality as it is perceived by the target audience and the actual product/service. The brand name should be conceptually on target with the product/service (what the company stands for). Furthermore, the brand name should be on target with the brand demographic.[9] Typically, sustainable brand names are easy to remember, transcend trends and have positive connotations. Brand identity is fundamental to consumer recognition and symbolizes the brand's differentiation from competitors.

Brand identity is what the owner wants to communicate to its potential consumers. However, over time, a product's brand identity may acquire (evolve), gaining new attributes from consumer perspective but not necessarily from the marketing communications an owner percolates to targeted consumers. Therefore, brand associations become handy to check the consumer's perception of the brand.[10]

Brand identity needs to focus on authentic qualities - real characteristics of the value and brand promise being provided and sustained by organizational and/or production characteristics.[11][12]

[edit]Visual brand identity

The visual brand identity manual for Mobil Oil(developed by Chermayeff & Geismar), one of the first visual identities to integrate logotype, icon, alphabet, color palette, and station architecture to create a comprehensive consumer brand experience.

The recognition and perception of a brand is highly influenced by its visual presentation. A brand’s visual identity is the overall look of its communications. Effective visual brand identity is achieved by the consistent use of particular visual elements to create distinction, such as specific fonts, colors, and graphic elements. At the core of every brand identity is a brand mark, or logo. In the United States, brand identity and logo design naturally grew out of the Modernist movement in the 1950s and greatly drew on the principles of that movement – simplicity (Mies van der Rohe’s principle of "Less is more") and geometric abstraction. These principles can be observed in the work of the pioneers of the practice of visual brand identity design, such as Paul Rand, Chermayeff & Geismar and Saul Bass.

[edit]Brand parity

Brand parity is the perception of the customers that some brands are equivalent.[13] This means that shoppers will purchase within a group of accepted brands rather than choosing one specific brand. When brand parity is present, quality is often not a major concern because consumers believe that only minor quality differences exist.

[edit]Expanding role of brand

When the technique of branding first started, it was meant to make identifying and differentiating a product easier. Over time, brands came to embrace a performance or benefit promise, for the product, certainly, but eventually also for the company behind the brand. Today, brand plays a much bigger role. Brands have been co-opted as powerful symbols in larger debates about economics, social issues, and politics. The power of brands to communicate a complex message quickly and with emotional impact and the ability of brands to attract media attention, make them ideal tools in the hands of activists--and hacktivists.[14]

File:RoleBrand.jpg

[edit]Branding approaches

[edit]Company name

Often, especially in the industrial sector, it is just the company's name which is promoted (leading to[citation needed] one of the most powerful statements of branding: saying just before the company's downgrading, "No one ever got fired for buying IBM"). This approach has not worked as well for General Motors, which recently overhauled how its corporate brand relates to the product brands.[15] Exactly how the company name relates to product and services names is known as brand architecture. Decisions about company names and product names and their relationship depends on more than a dozen strategic considerations.[16]

In this case a strong brand name (or company name) is made the vehicle for a range of products (for example, Mercedes-Benz or Black & Decker) or a range of subsidiary brands (such as Cadbury Dairy Milk, Cadbury Flake or Cadbury Fingers in the United States).

[edit]Individual branding

Main article: Individual branding

Each brand has a separate name (such as Seven-Up, Kool-Aid or Nivea Sun (Beiersdorf)), which may compete against other brands from the same company (for example, Persil, Omo, Surf and Lynx are all owned by Unilever).

[edit]Attitude branding and iconic brands

Attitude branding is the choice to represent a larger feeling, which is not necessarily connected with the product or consumption of the product at all. Marketing labeled as attitude branding include that of Nike,Starbucks, The Body Shop, Safeway, and Apple Inc.. In the 2000 book No Logo,[17] Naomi Klein describes attitude branding as a "fetish strategy."

"A great brand raises the bar -- it adds a greater sense of purpose to the experience, whether it's the challenge to do your best in sports and fitness, or the affirmation that the cup of coffee you're drinking really matters." - Howard Schultz (president, CEO, and chairman of Starbucks)

The color, letter font and style of the Coca-Colaand Diet Coca-Cola logos in English were copied into matching Hebrew logos to maintain brand identity in Israel.

Iconic brands are defined as having aspects that contribute to consumer's self-expression and personal identity. Brands whose value to consumers comes primarily from having identity value are said to be "identity brands." Some of these brands have such a strong identity that they become more or less cultural icons which makes them "iconic brands." Examples are: Apple, Nike and Harley Davidson. Many iconic brands include almost ritual-like behaviour in purchasing or consuming the products.

There are four key elements to creating iconic brands (Holt 2004):

1.    "Necessary conditions" - The performance of the product must at least be acceptable, preferably with a reputation of having good quality.

2.    "Myth-making" - A meaningful storytelling fabricated by cultural insiders. These must be seen as legitimate and respected by consumers for stories to be accepted.

3.    "Cultural contradictions" - Some kind of mismatch between prevailing ideology and emergent undercurrents in society. In other words a difference with the way consumers are and how they wish they were.

4.    "The cultural brand management process" - Actively engaging in the myth-making process in making sure the brand maintains its position as an icon.

[edit]"No-brand" branding

Recently a number of companies have successfully pursued "no-brand" strategies by creating packaging that imitates generic brand simplicity. Examples include theJapanese company Muji, which means "No label" in English (from 無印良品 – "Mujirushi Ryohin" – literally, "No brand quality goods"), and the Florida company No-Ad Sunscreen. Although there is a distinct Muji brand, Muji products are not branded. This no-brand strategy means that little is spent on advertisement or classical marketing and Muji's success is attributed to the word-of-mouth, a simple shopping experience and the anti-brand movement.[18][19][20] "No brand" branding may be construed as a type of branding as the product is made conspicuous through the absence of a brand name. "Tapa Amarilla" or "Yellow Cap" in Venezuela during the 80´s is another good example of no-brand strategy. It was simple recognized by the color of the cap of this cleaning products company.

[edit]Derived brands

In this case the supplier of a key component, used by a number of suppliers of the end-product, may wish to guarantee its own position by promoting that component as a brand in its own right. The most frequently quoted example is Intel, which positions itself in the PC market with the slogan (and sticker) "Intel Inside".

[edit]Brand extension and brand dilution

The existing strong brand name can be used as a vehicle for new or modified products; for example, many fashion and designer companies extended brands into fragrances, shoes and accessories, home textile,home decor, luggage, (sun-) glasses, furniture, hotels, etc.

Mars extended its brand to ice cream, Caterpillar to shoes and watches, Michelin to a restaurant guide, Adidas and Puma to personal hygiene. Dunlop extended its brand from tires to other rubber products such as shoes, golf balls, tennis racquets and adhesives.

There is a difference between brand extension and line extension. A line extension is when a current brand name is used to enter a new market segment in the existing product class, with new varieties or flavors or sizes. When Coca-Cola launched "Diet Coke" and "Cherry Coke" they stayed within the originating product category: non-alcoholic carbonated beverages. Procter & Gamble (P&G) did likewise extending its strong lines (such as Fairy Soap) into neighboring products (Fairy Liquid and Fairy Automatic) within the same category, dish washing detergents.

The risk of over-extension is brand dilution where the brand looses its brand associations with a market segment, product area, or quality, price or cachet.

[edit]Multi-brands

Alternatively, in a market that is fragmented amongst a number of brands a supplier can choose deliberately to launch totally new brands in apparent competition with its own existing strong brand (and often with identical product characteristics); simply to soak up some of the share of the market which will in any case go to minor brands. The rationale is that having 3 out of 12 brands in such a market will give a greater overall share than having 1 out of 10 (even if much of the share of these new brands is taken from the existing one). In its most extreme manifestation, a supplier pioneering a new market which it believes will be particularly attractive may choose immediately to launch a second brand in competition with its first, in order to pre-empt others entering the market.

Individual brand names naturally allow greater flexibility by permitting a variety of different products, of differing quality, to be sold without confusing the consumer's perception of what business the company is in or diluting higher quality products.

Once again, Procter & Gamble is a leading exponent of this philosophy, running as many as ten detergent brands in the US market. This also increases the total number of "facings" it receives on supermarket shelves. Sara Lee, on the other hand, uses it to keep the very different parts of the business separate — from Sara Lee cakes through Kiwi polishes to L'Eggs pantyhose. In the hotel business, Marriott uses the name Fairfield Inns for its budget chain (and Ramada uses Rodeway for its own cheaper hotels).

Cannibalization is a particular problem of a "multibrand" approach, in which the new brand takes business away from an established one which the organization also owns. This may be acceptable (indeed to be expected) if there is a net gain overall. Alternatively, it may be the price the organization is willing to pay for shifting its position in the market; the new product being one stage in this process.

[edit]Private labels

With the emergence of strong retailers, private label brands, also called own brands, or store brands, also emerged as a major factor in the marketplace. Where the retailer has a particularly strong identity (such asMarks & Spencer in the UK clothing sector) this "own brand" may be able to compete against even the strongest brand leaders, and may outperform those products that are not otherwise strongly branded.

[edit]Individual and organizational brands

There are kinds of branding that treat individuals and organizations as the products to be branded. Personal branding treats persons and their careers as brands. The term is thought to have been first used in a 1997 article by Tom Peters.[21] Faith branding treats religious figures and organizations as brands. Religious media expert Phil Cooke has written that faith branding handles the question of how to express faith in a media-dominated culture.[22] Nation branding works with the perception and reputation of countries as brands.

[edit]Crowdsourcing Branding

These are brands that are created by the people for the business, which is opposite to the traditional method where the business create a brand. This type of method minimizes the risk of brand failure, since the people that might reject the brand in the traditional method are the ones who are participating in the branding process.

[edit]History

The word "brand" is derived from the Old Norse brandr meaning "to burn." It refers to the practice of producers burning their mark (or brand) onto their products.[23]

Although connected with the history of trademarks[24] and including earlier examples which could be deemed "protobrands" (such as the marketing puns of the "Vesuvinum" wine jars found at Pompeii),[25] brands in the field of mass-marketing originated in the 19th century with the advent of packaged goods. Industrialization moved the production of many household items, such as soap, from local communities to centralizedfactories. When shipping their items, the factories would literally brand their logo or insignia on the barrels used, extending the meaning of "brand" to that of trademark.

Bass & Company, the British brewery, claims their red triangle brand was the world's first trademark. Lyle’s Golden Syrup makes a similar claim, having been named as Britain's oldest brand, with its green and gold packaging having remained almost unchanged since 1885. Another example comes from Antiche Fornaci Giorgi in Italy, whose bricks are stamped or carved with the same proto-logo since 1731, as found inSaint Peter's Basilica in Vatican City.

Cattle were branded long before this. The term "maverick," originally meaning an unbranded calf, comes from Texas rancher Samuel Augustus Maverick who, following the American Civil War, decided that since all other cattle were branded, his would be identified by having no markings at all. Even the signatures on paintings of famous artists like Leonardo Da Vinci can be viewed as an early branding tool.

Factories established during the Industrial Revolution introduced mass-produced goods and needed to sell their products to a wider market, to customers previously familiar only with locally-produced goods. It quickly became apparent that a generic package of soap had difficulty competing with familiar, local products. The packaged goods manufacturers needed to convince the market that the public could place just as much trust in the non-local product. Campbell soup, Coca-Cola, Juicy Fruit gum, Aunt Jemima, and Quaker Oats were among the first products to be 'branded', in an effort to increase the consumer's familiarity with their products. Many brands of that era, such as Uncle Ben's rice and Kellogg's breakfast cereal furnish illustrations of the problem.

Around 1900, James Walter Thompson published a house ad explaining trademark advertising. This was an early commercial explanation of what we now know as branding. Companies soon adopted slogans,mascots, and jingles that began to appear on radio and early television. By the 1940s,[26] manufacturers began to recognize the way in which consumers were developing relationships with their brands in a social/psychological/anthropological sense.

From there, manufacturers quickly learned to build their brand's identity and personality (see brand identity and brand personality), such as youthfulness, fun or luxury. This began the practice we now know as "branding" today, where the consumers buy "the brand" instead of the product. This trend continued to the 1980s, and is now quantified in concepts such as brand value and brand equity. Naomi Klein has described this development as "brand equity mania".[17] In 1988, for example, Philip Morris purchased Kraft for six times what the company was worth on paper; it was felt that what they really purchased was itsbrand name.[27]

Marlboro Friday: April 2, 1993 - marked by some as the death of the brand[17] - the day Philip Morris declared that they were cutting the price of Marlboro cigarettes by 20% in order to compete with bargaincigarettes. Marlboro cigarettes were noted at the time for their heavy advertising campaigns and well-nuanced brand image. In response to the announcement Wall street stocks nose-dived[17] for a large number of branded companies: Heinz, Coca Cola, Quaker Oats, PepsiCo. Many thought the event signalled the beginning of a trend towards "brand blindness" (Klein 13), questioning the power of "brand value."

The Importance of Brand

Branding is a very powerful component in business. The brand must have a logo to make branding easier and more possible. The consumers decide if they will buy a product or use a service based on how they view the brand. The brand itself tells us or let us imagine how good or bad the product is even if we never tasted it before! All that brand promotion and advertising really do tell us how great a brand can be (like Nike). Once a customer likes your brand he/she will definitely come back for repeated services or products. The qualities of the product or services are ensured through the customers minds from the brand image.

Brand is not only convenient for businesses for repeated customer purchase but also easier for customers to filter out the countless generic items. Brand gives consumers the reason to buy it and wastes less time for consumer to choose.

There are ways to improve a brand from advertising such as viral campaign (more trustworthy), online ads, print ads and commercials. Another way is to improve your product or services that will reinforce the brand. This is a good way to promote your brand by always being in the cutting edge or “customer’s first image”.

The qualities of your products and services will reinforce the brand. Advertise as much as possible to spread that message and make it into a cult brand. Branding doesn’t only benefit the business but you as well (yes I mean it). The brand you choose reflects who you are and expresses yourself on what you like to do and be able to join the community of like minded people. Branding is a win: win situation for both the businesses and the loyal customers.

When we think of Coca-Cola, McDonald’s, United Postal Service, Tim Horton’s or evenRolex…we often associate those names with the products/services they provide to us. Rarely do we recognize the unconscious, predictable and emotional responses that we react to when exposed to those products or when they come to mind. Ask any child to draw something about McDonald’s and 99% of the time the picture will include a golden arch or pictures toys they receive in their Kid’s Meals. Many adults find they can hardly function without their daily quick fix of Timmies coffee to begin their day; Ferrari initiates a response of adrenaline due to speed & style, and a bottle of Cristal might cause excitement in anticipation of a good time.

But why are brands even important?

A lot of investors overlook the importance of brands because to most people they’re simply a name, label or logo that people associate with a good or bad company. The main problem for an investor is that you can’t easily place a price per share of value that a brand creates for a company based solely on consumer sentiment. If someone did develop a strategy to evaluating a company for an associated premium or discount, it would be extremely difficult and speculative in doing so.

My own approach has been to take into consideration the impact branding has on a business’s ability to succeed in the future based on their brand(s) when I analyze the company. I’ve found that it’s quite simple to make assumptions on future growth, stability and fundamentals of the company once that concept is included in your analysis and you understand the prospects of those products or services. Brands offer an extremely predictive look into the behaviour of large corporations because beyond shareholder value, day to day operations and profitability…any CEO with half a mind knows his/her job rests on the value of the brand their company is associated with.