Brands and Branding

“What’s in a name? That which we call a rose by any

other word would smell as sweet”, said Shakespeare.
What explains McDonald’s, Apple I Pod, Toyota and Harley
Davidson, etc., to be among the top 100 brands? Is it
their sales revenue? No. Is it their years of existence? No.
Is it their global presence? No. If all of these are not
indicative of the companies’ entitlement to feature in the
global brands’ list, what then explains their inclusion? The
answer is Brands. Because these companies are able to
create, nurture, and sustain powerful brands and all the
above stated inferences are consequences of these
untiring efforts. The next question is what’s a brand? A
brand is a collection of perception in the minds of the
consumers and resides in the minds of the consumers
and resides in their minds. It propels them with a very
high perceived association value. A brand is not a by
product, an ad campaign, a logo, a spokesperson or a
slogan. It is a differentiating identity and the most
important reason for the employees, investors and
customers to associate with the company. It is the firm’s
most important asset in the long term. It is also a bond
between the customers and the company. A brand
assures reliability and quality. Brand owners have a
powerful incentive to ensure that each pie is as good as
the previous one because that would persuade people to
come back for more.
Brands are perceptions. The Volvo brand stands for
“safety”. The Mercedes Benz brand is associated with
“prestige”. “BMW means “the driving”. Can these
perceptions be influenced or managed? That is precisely
what is executed through branding. Branding is creating a
corporate brand identity imprinted on the minds of
consumers, and this requires brand positioning and brand
management.

Brands are the tools with which companies seek to build

and retain customer loyalty and branding often requires
huge investment on advertising and a good marketing
strategy. A strong brand can raise prices as well as
barriers to new entrants.
In the age of increasing commoditization and at the
juncture when the so-called “distinctiveness” is getting
blurred due to increasing competition, the relevance of
brands is questioned.
An interesting phenomenon is evolving on the horizon
pertaining to the role of brands. As the world economies
are integrated, the income levels are also on the rise.
Increased income levels are creating brand conscious
customers. And these customers pay more for a brand
because it seems to represent a way of life. They are
affording an aspirational lifestyle as manifested by a
brand. The companies that can match the aura of their
brands with the aroma of new lifestyle stand to gain in
today’s world.

What is a brand today?

We live in a marketing world today. Everywhere you go,
every corner you pass and any discussion you have is
bound to be about brands- be it an F1 race, the World
Cup, some big corporate scandals, some IT
product/services you just brought, etc. Brands are all
around us. Most CEO’s and marketing managers have
realized that they are dealing with a very chaotic
situation today in terms of brand building and marketing.
Although it is important to gain marketing and
promotional skills and know-how, it is even more
important to question what one’s brand means to the
markets in today’s context.

What does it mean to be a brand today and

tomorrow?
Instead of defining a brand in the traditional context of
brand identity, brand image, brand profile, brand DNA we
can define a brand as an entity(product, service,
company, person, technology, etc.,) that offers a set of
value exchange measures between what the
owner/market seeks and the price he is willing to pay for.
The set of value exchanges can be portrayed as being
similar to tentacles of the entity as it reaches out to
engage the market, and in return the brand gains
economic profits.
Innovation is important in today’s competitive market; we
can no longer qualify a product, service or company as
branded just because it is well known. The importance
must be placed on the quality and the relevance that the
brand brings to its market rather than the quantity of how
many people know the brand. As we all operate in an
informed society the significance of being known is
diluted. Most people will recognize a trade name that is
well advertised, but it does not mean that they
appreciate the “brand” for the so-called qualities it
represents or provides.

A brand today must satisfy economic reasons to exist

and those reasons have to be in context of today’s
market and that of the future. Therefore, to be a real
brand for today’s or tomorrow’s market, an entity must
satisfy six value exchange qualities/dimensions.

The Six Brand Value Exchange Qualities

A)Social Dimension
To become a brand, an entity must have a social
purpose. The social purpose can be to benefit the
brand owner in his social setting, i.e., one that allows
him to become more acceptable in a certain peer
group or to perpetuate an ideal that the brand hopes
to develop as a competitive edge, i.e., as a tool to
grow a certain social trend or ideas which have a
mass appeal for example, Nike-“Just do it”. To deliver
and sustain this social dimension of the brand,
companies must invest in the development of certain
product features or create programs/ processes/
campaigns that will allow the entity to fulfill that
purpose.
An entity that has no social dimension is simply
satisfying the functional purpose of what it is
supposed to do, for example, Bata with its “Power”
brand is just manufacturing sports shoes without
much cost on advertisements, knowing that people
don’t really go for their sports range and stick to
Bata’s formal collection. They compensate by
displaying those shoes in their main Bata showrooms
which gives them satisfactory sales. On the other
hand a company like Reebok is trying to convince its
customers of the social relevance of its brands by
starting an add campaign staring Thierry Henry one
of the best football players in the world to promote
its slogan “Run Easy”. In India it is using Henry along
with our cricketing Gods like Rahul Dravid and
Mahendra Singh Dhoni for that very purpose.

B) Personal Enrichment Dimension

A brand must bring relevance to the person who
owns it. It must be able to bring about fulfillment that
is more than just the functional purpose of the entity.
Why would people be willing to pay 3 to 4 times the
normal price for a bouquet of roses on Valentine’s
 Day? It is because Valentine’s Day is a brand and on
that day, couples can fulfill their desire to show the
degree of affection and love to each other. It’s not
about the roses or “oops…I paid three times more”.
When the roses exchange hands between the giver
and the receiver, both of them feel happy; their lives
are enriched by the brand called “The Valentine’s
Day”.
Thus the true brand must be able to capture that
essence of bringing about personal enrichment to the
brand owner. Without that essence, it’s just another
product or service or company.
C) Influence Dimension
A brand must be able to provide the brand owner
with the capacity to influence an individual, a group,
a situation or a society. However the most important
influence that the brand must have is to enable the
brand owner to influence himself on the ideals that
he hopes to achieve or gain. An entity that lacks the
capacity to influence cannot be classified as a brand
because it offers no real capability to earn economic
value, such as enabling high growth increment in
sales.
This perhaps explains why many companies invest
heavily in advertising and promotional activities yet
they fail to achieve high sales return from those
investments. While these companies see high sales
only during the period of promotion, they suffer an
almost exponential slump in sales when those
 advertisements are stopped. There is no strong
sustainable high sales growth because their entity
lacks the power to influence.
D) Innovation Advantage Dimension
These days innovation is the key word for the
business to survive. Companies wishing to become a
brand cannot afford to be followers. They must invest
significantly on innovation that will provide them the
first mover advantage to quickly capitalize on the
opportunity of the day and maximize the economic
returns from their market share. There is no point in
claiming to be branded while you are just a laggard
or copycat to innovative ideas brought by others.
Society admires and support leaders who bring
meaning to their lives. This has been so in the past
and it will be so for times to come. Innovation can be
in many forms like the product functions, aesthetics
business processes related to the brand, etc.

E) Security/ Assurance Dimension

Security, or in layman’s language “peace of mind”, is
an important quality of a brand makeup. No company
should seriously claim to be a brand or that it owns
when it cannot afford it’s market the “peace of mind”
form the point when the brand is first communicated
to the point when the brand has exhausted it’s
usefulness to it’s owner. Security and assurance
builds trust which is important for a brand to grow its
economic value and profit from it. Although the
security assurance aspects of the brand can be
provided by process means like providing lifetime
warranty programs, etc., it is even more important
for the brand to project and provide this quality from
the experiential and psychological aspects of the
brand.
F) Access and Availability Dimension
It is not uncommon to find great and truly unique
products or services that can have considerable
mass appeal to be completely inaccessible or
unavailable. For an entity to be a real brand, it must
be reachable to the target markets through proper
development of access channels. The brand
distribution must blanket the entire market it intends
to cover through various mediums.
Companies must also put in place policies and
business processes that encourage the brand to be
as close as possible to its prospective markets. You
and I have come across many situations where the
policies and the business processes or procedures of
a company simply turn off our initial interests in
getting to know more of the brand. It is not
uncommon to come across many red tapes and
barriers to access a certain service due too policies
that are put in place. We have also experienced
inconvenience to locate a certain brand due to its
retail location, strode environment, etc. Inappropriate
price barriers also turn off customers. All these
barriers prevent the brand to become successful.
Therefore, a true brand management must seek to
address these issues and begin to build greater
accessibility and availability as a part of the quality
of its brands.
These six value exchange dimensions are important
to define what a brand is today. This is the essence of
a true brand and a better understanding of what a
brand means today can help companies to manage
their brands better for the future. Companies need
not waste money and resources on programs and
activities that have no impact on their strategic
goals.
A more organized systematic top-down
structure within the organization from policy
making to business processes is required to
build and manage successful brand.

TOP DOWN STRUCTURE

An Expert’s View
AI Ries is the author/co-author of 11 books on
marketing, including his latest, The Origin of Brands.
He and his daughter Laura run the Atlanta Based
marketing strategy firm Ries & Ries ( www.ries.com).
In the last ten years have the connotation of
Brands and Branding changed? What are the
new insights on the horizon?
Ten years ago, the emphasis in marketing was on
“selling”. Success was measured in terms of what a
company’s current sales were increasing, remaining
static or falling.
Today, however, companies have become to realize
that their most important assets are their brands.
The objective of a marketing program should be to
build a brand, not to sell a product or service. Selling
is a function of the sales department. If a company
does a good job of building its brands, then the
selling process is greatly enhanced.
The newest insights, as we see is it, is that brands
are built, not by advertising, but by PR or publicity.
In “The Origin of Brands”, you have talked
about the great tree of brands. How easy it is
and how difficulty is it to build and nurture a
powerful tree of brands?
As time goes on and as a category diverges, it
becomes difficult for a company to dominate an
entire category tree. A single company doesn’t have
either the technological skills or the resources to do
that. Rather, a company should be selective and a
tree to dominate only certain branches of a diverging
tree. Take Coca-Cola, for example. The company is
trying to dominate all aspects of a diverging soft-
drink tree. The truth is the company doesn’t lead in
any category except its original cola category. It
should have been more selective. Try to dominate
only those diverging categories where it has some
inherent advantage.

How do you define a brand personality? At

what stage of life cycle do you articulate and
infuse brand values that may nurture and
might define a brand personality?
The brand doesn’t have a personality. It’s the users
of the brand that have a personality. In other words,
a brand lives or dies inside the mind of the prospect.
Certain brands appeal to certain segments of the
market. Starbucks, for example, appeals to young,
affluent sociable individuals. It’s these individuals
that give the Starbucks brand its personality.
In the best of all possible worlds, you should select
the target market before launching a new brand. If
you do a good job in marketing the brand to that
target market, then the brand itself will assume will
assume the personality of the target market.
To what extent does differentiation help in
building a strong brand? How can the
differentiations premise be extended
throughout the lifetime of a brand?
Every brand that becomes successful starts out with
a strong differentiation. Take Rolex watches. Initially,
Rolex was the first brand of expensive watches that
prospects learned about. Furthermore, the product
itself was differentiated by its unique watch brand.
Today, Rolex is a powerful world wide watch brand.
But it’s not different anymore. There are many more
brands of expensive watches that mimic the Rolex
watch brand. But Rolex continues to be the most
successful high-end watch brand.
Be first. Then let your competitors copy your strategy
and you will remain successful even after your
differentiation disappears.
What according to you are the five most
important things companies must do to build
strong brands and to nurture a strong brand?
1) Be first. It’s better to be first than it is to be better.
McDonald’s was the first hamburger chain.
2) Launch the new brand with PR.
3) Own a word in the mind. Volvo owns “safety”.
BMW owns “driving”.
4) Be visually different, the curves of a Coke bottle,
the grill of a Mercedes can be considered as an
example.
5) Use massive advertising after the brand has
achieved credibility in the minds of consumers.