The Power Of Branding In Building A Successful Business
To have a successful business, then it is important to understand the power of branding in building a business, and building a successful business brand starts with self-branding, which has to do with a lot of packaging and self-development. The first thing you need to know is that You Are Your Own Brand. However, a lot of things are involved in building a successful business, these are what I will be discussing below.
What is a Brand?
A brand is name, term, design, symbol or any other feature that identifies one seller’s goods or services as distinct from those of other sellers. Brands are used in business, marketing, and advertising. Name brands are sometimes distinguished from generic or store brands.
Creating a Brand is no way different from founding your business. It takes time. Gradually you can create Brand Equity. Brand equity is the differential effect when consumers react more favorably to a brand than to a generic or unbranded version of the same product. For most people, whenever they think of buying a Smartphone the very first name that strikes is – the iPhone. Ask why? It’s because of comfort and authenticity delivered by the iPhone to its users.
Apple throughout their years of research and experience has created a state in our mind of ultimate luxury and comfortability in using their products. There may be a few more similar products of others in line with Apple iPhone and may be superior to that, but the identity of iPhone gives it the edge over others- no matter what the price tag is. This edge is Brand Equity.
4 Steps of Brand Development Strategy
There are four effective steps in brand development, and they are:
- Choose the brand name and logo
- Establish the brand in the minds of customers
- Brand Sponsorship
- Develop the brand
1. Choose the Brand Name and select the Logo:
While building a brand development strategy name plays a vital role. A good name and style can add positives to a product’s success. It is the most difficult task to start with. Simplicity is the first step. The name should be easy to pronounce, recognize and remember. Moreover, it should suggest something about the product’s benefits and qualities.
Names like Google, Nike, Facebook, Apple, KFC, etc. are among the most established brands all over the world. The interesting fact about those names is that they are easily translatable in different languages around the world. Hence the meaning of a particular word should not be something which indicates bad, wrong or negative.
Again the name should be extendable to cover up multiple product lines. For example, Amazon.com started its business with bookselling and now has been extended to multiple product categories.
Once chosen, the brand name should also be protected, which means in many instances brand names were eventually mixed up with the product category and people cannot differentiate the brand identity from the product category.
For example, Xerox is a company that builds copier machines, but doing a photocopy is often termed as doing xerox. ‘Xerox’ is to be pronounced as a noun and not as a verb. Many people find it hard to distinguish between the product and the service which ultimately hampers the brand name of the Company.
2. Establishing the brand in the minds of customers:
An interesting saying by a marketer- “Products are created in the factory, but brands are created in the mind”. This can be done in multiple ways; at the basic level, it starts with introducing the product and its distinguishing characteristics to the target customers. For instance, Amazon’s Kindle- e-book reader; Amazon’s main target will be on readers that prefer reading books in a virtual format.
The more effective way a brand can be positioned by associating its name with desirable benefits the better it is. Thus, Kindle is beyond an e-book reader – it is lightweight, on the go dictionary, stores thousands of books which are easy to search, no glare and zero distractions.
The strongest brand goes beyond establishing features and benefits in customers’ mind and positions itself on strong values and beliefs, rooted in a deep emotional bonding. Like reading books in Kindle is an absolute pleasure and presents itself as booklover’s new best friend. When placing a brand in the human mind, the marketer should establish a mission for the brand and a vision of what the brand must be and do.
3. Brand Sponsorship:
Brand sponsorship can be of three types, and they are;
- Private Brand sponsorship
- Licensed Brand sponsorship
Private Brand Sponsorship:
Lots of advertisements and social marketing strategies work behind the big brands to emerge and are termed as National brands. But for smaller companies, it may not always be possible to endorse brands with a huge out of pocket expenses. In those scenarios, brand sponsorship is very important. As against National or Manufacture’s brands, there are Store brands. In recent decades store brands are gaining more from the market. Here’s why?
Big shopping malls like Big Bazaar, Wal-Mart resells products at significant discount rates, especially the generic or no-name brands. They endorse the products citing its advantages or putting side by side comparison with the top brands. The association of the big resellers with less known products works as an aid in uplifting the brand value of the product once termed as ‘no-name’.
Private brand sponsorship is also followed in online shopping too. As we can see small or lesser-known mobile manufacturers are recently tying up with Amazon to sell their phones. In fact, this strategy is working great as the ‘no-name’ brands are getting the support of the big brand stores to be it online or offline.
Licensed Brand Sponsorship:
In this brand sponsorship, some companies buy the names and symbols of other manufacturers or creators with a fee and endorse its products under such brand name. This is a common thing in the fashion industry like Calvin Klein, Tommy Hilfiger, Gucci, Armani, etc., where the Companies are using the names and initials of well-known fashion innovator. This type of branding turns out as an added fillip but with a pinch in the pocket.
Under this brand sponsorship strategy, established brand names of different companies are used on the same product. Because each brand dominates in a different category, the combined brands create broader consumer appeal and greater brand equity.
For example, Bajaj Allianz Life Insurance where Bajaj is a dominant player in the automobile sector and Allianz is a German financial service major. Now since Bajaj wants an entry in the insurance sector and Allianz wants an entry in the Indian market, they jointly made a brand ‘Bajaj-Allianz’ to reap the fruits of the Indian insurance market.
Co-branding carries some limitations too. Such relationships usually involve complex legal contracts and licenses. Co-branding partners must carefully coordinate their advertising, sales promotion, and other marketing efforts. The onus lies on both the partners to carry the co-brand with trust and dignity.
4. Developing Brands:
To augment the brand equity, it is very important to prepare a brand development strategy to go with changing business scenarios. There is no hard and fast rule to dictate over, here are some things to look into;
- Line extensions:
Line extension occurs when the company lengthens its product line beyond its current range. A product line extension is the use of an established product brand name for a new item in the same product category. However, an overextended brand name might cause consumer confusion or lose some of its specific meaning.
- Brand extensions:
It happens when a current brand name is extended to a new or modified product in a new category. For example, Nestlé’s popular brand of noodles Maagi has been extended to its tomato ketchup, pasta, soup, etc. A brand extension gives a new product instant recognition and faster acceptance. But one should be careful while extending the brand as it may confuse the image of the main brand.
Multibranding strategy is an approach of the company to market several similar and competitive brands of the same company under the guise of different brand names. The idea of multi-branding strategy is to restrict or end the competition and increase the market share.
Brands are not created in a day or two; it takes time to grow it. The above – mentioned points suggest some best practices to build a brand, but the real test begins in the field. Brand development strategy differs from place to place; even urban branding and rural branding are way different in their practical applications. Remember that behind a successful brand development strategy, there lies lots of endeavors, a vividly clear vision and above all – an uncompromised quality of product or service.