The Importance of Developing a “Brand” for your Company

What is a Brand?
The history of the words “brand” and “branding” are derived from the Old Norse word brandr, “to burn,” from which we get the “branding” of livestock. This was the word’s original meaning, but it has developed in meaning and now the use of the word “brand” eventually came to mean a mark of distinction and differentiation, a sign of quality and trustworthiness. So at its most basic, a brand is an indentifying mark. The brand becomes the identity of a company. Beyond this it represents a consistent value system that a company presents to the world and that is seen to be that company’s way of doing things. A name and logo are recognizable elements of a brand and come to mind when most people think of a brand. The brand name also functions to differentiate your offerings from your competition. A brand is associated with a product in order to differentiate its characteristics in some way or other from products designed to serve the same need, i.e., competitors. These unique characteristics by which one can identify a particular product and differentiate it from other competitor products are identified with the brand of the product. The process of developing a true brand begins with brand differentiation, making your brand unique in the minds of consumers. Properly differentiating your brand will eventually lead to brand identity. A product’s brand is also associated with an assurance to the consumer that the purchased product is of consistently good quality. In this sense, a brand stands for an implicit “promise” the manufacturer of the product makes to the consumer regarding the consistency and quality of their products. Branding and brand management is all about establishing trust between business and consumer. The brand name is a reminder to the target audience of that implicit promise—the promise of consistent quality and a guarantee that the product’s characteristics are unique to that product.

Brand Identity
Brand identity is the total proposal/promise that an organization makes to consumers. Even though certain specific company communications will often vary in order to effectively address a specific audience, a brand and its promise should always remain consistent across all audiences. A consistent brand promise, at its very essence, should match across all audiences in order to more effectively establish the brand expectations that will be fulfilled in the consumers’ experience with the brand. Your brand expresses, in effect, the essence of what you represent. It’s basically the embodiment of your positioning, and the right customer experience is what you want to deliver each time your consumers react or interact with your brand. The company’s brand identity expresses how a business wants to be perceived in the market. A business communicates its identity to the consumers through its branding and marketing strategies. A brand is unique due to its identity and it is something that persists and remains consistent through time. In sum, brand identity is the noticeable elements of a brand (for instance – customs colors, logo, names, or symbols) that identify and differentiates a brand and comes to occupy a position in the target audience’s mind.

Brand Associations
Brand associations are a bundle of mental and functional associations with the brand. Associations are not just “reasons-to-buy” but provide consumers with a familiarity and differentiation that’s not replicable without the presence of the brand name in the minds of consumers. Also important are the associations and attitudes that people develop when they think and talk about your brand. And, brand attitudes are anything that influences how your brand (or a company) is perceived by its target audiences. While your brand establishes an identity it is also developing brand personality. Brand associations are a conglomeration of all the either positive or negative traits or characteristics that is linked in the mind of the consumers; all of the feelings, opinions, ideas, images and attitudes they have when they think about or see your brand name/logo. For example, just hearing the words “Cadillac” or “Lincoln” could trigger a host of different images depending upon your experiences with the brand but, for most, these brand names conjure up images and thoughts of luxury, wealth, and success in your mind.

Brand Loyalty
A consistent brand identity leads to certain brand associations, etc. which further leads to brand loyalty. Brand loyalty means that consumers will only purchase a certain product within a product category, and will think negatively towards other products in the same category. Brand loyalty is the extent to which consumers constantly buy the same brand within a product category. That means that they will not use other brands because they have determined that their favorite brand fulfills all of their needs at a quality level that supports their idea of a good price. The thing is, even if the other brands are available at a cheaper price or superior quality, the brand loyal consumer will stick to his brand because they have become loyal to it. The more brand loyalty your service develops, the less you have to spend on marketing because the brand loyal customers promote the brand positively on their own and will respond less to what your competitors are doing. The result is that a company having brand loyal customers will develop greater sales, less marketing and advertising costs, and best pricing. This is because the brand loyal customers are less reluctant to shift to other brands, respond less to price changes and self- promote the brand as they perceive that their brand have unique value which is not provided by other competitive brands.
Brand Equity
Brand name associations and brand loyalty go beyond the functional aspects of what a company has to offer and builds on intangibles like trust, positive opinions and attitudes, perceived quality and brand identity. Developing strong and consistent loyalty generates brand equity, another intangible that may not show up on a company’s financial statements but nevertheless could very well become the primary source of distinctive competitive advantages and future earnings. Even though brand equity is comprised of hidden assets, it lets the branded company earn greater volume or margins than it could without brand equity. Brand loyalty and equity are crucial for the long-term financial success of your brand and its offering(s) and your company.

Product versus Brand
The concepts of “Product” and “Brand” are two totally different ideas; nevertheless they two often get confused. However, a product is only a brand if people think of imagery and associations when they think of that product. Most so called industrial brands are just labels for products which could just as easily be referred to by a generic description or a number or any other such code for the purpose of ordering. A Product name is simply a convenient locator in a range of other like products. A product name is something which could just as easily be ordered by description. A product name is simply a label which could be changed without any loss of loyalty to the customer. Finally a company name is just a label which customers have in order to look something up buy don’t really care about. By contrast, the brand name is the name people use when talking about the product to someone else, or when customers think of the brand itself rather than some product. The brand as we have said above has a unique identity, the brand develops a kind of personality beyond the mere product and customers start to have opinions and attitudes about their favorite or non favorite brand. Finally, a brand is something people would pay a premium for under that and no other name. Something customers ask for by name. In an important sense the brand name itself carries value. Product names, however, do not come close to this.
It is now well known that a company’s brand itself is a source of equity, cash flow, and revenue.

Story by Mark Joseph Manion