If You Are Confused About the Concept of “Brands”

Sun Lei
 The author is an experienced brand consultant, who has many
years’ experience in brand planning, marketing strategies and
integration of communication planning and implementation.

 Once worked as senior manager in multi-national and local

companies in marketing consulting and integrating
communications fields, experienced in strategic planning. He
formerly worked for CNC and was responsible for brand
management.
 Providing brand strategies, communication strategies and
implementation and training service for many international and
local clients. The brands include: FAW-Volkswagen, Jetta Cars,
263 Internet Communications, Dangdang Website, Aucma Air-
conditioner, FAW Toyota, Tour in Sichuan, CNC, LG, Beijing Yanli
Food, and more.
 He constantly ponders and develops professional settlement
methods in marketing, branding and communication fields, etc.
Lots of articles have been published in professional media such
as International Advertising, AD PANORAMA, Advertising
Pointer, China Marketing Communication Website (EMKT) and
so on.
 You are welcome to discuss your ideas and express your
opinions with the author.
Tel: 13901385424 E-mail: lei.sun@revobranding.com

Ambiguous Brand Definitions

The definition of a brand can not be truly, exactly defined or understood.

Kotler, the author of Marketing Management, defined brand as a name, a noun, a

symbol, a kind of design or all of the above, and he understood that brands contribute to
make products or services different from other competitors.

A famous advertising agency company thinks that, brands equal to images.

A consulting company believes that brands are the relation between products and
consumers, and brand development is the development of the relationships between
products and consumers.

I have also heard of many other different definitions, for example, brands are
commitments; brands are experience; brands are perceptions; and so on. Based on
these definitions, diversified brand theories will be used to explain different phenomenon,

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and certain methods will be created to guide the practice of brand construction. Since
there are so many brand definitions in the actual world, even some authoritative, widely-
cited brand theories can not explain some events or situations.

Let’s first ask questions about Kotler’s definition: if brands are only used to make
differences, then why does brand have value? Why there are different prices for the
same products after being differentiated by different brands, and why are people willing
to buy them?

If brands are images, than what does that make images? What is the relationship
between images and products? Are the images in consumers’ minds or possessed by
enterprises?

If brands are relations, what is the meaning of adding brand names or logos to
products? Why do enterprises like to hire super stars as spokespeople to develop their
products publicity, instead of just using the money to improve the relationships between
them and consumers? Or more directly, just lower the price of the products which can
give the consumers more benefit in order to improve their relation with the consumers.

Every time when I encounter a new definition on the theory of “Brands”, I will put it to
the test of my past experience and practices. The results usually disappoint me. Not only
I, but all the people dealing with brands will meet similar problems. Enterprise top
leaders, marketing heads and advertising or PR company staff actually are discussing,
developing, creating and managing brands every day. But for those who have very close
relationships with brands, it is really astonishing that there is not an authoritative
explanation or an accepted definition on “what are brands”. Maybe some people who
have more knowledge, deeper thinking and more experience will try to build their own
theory system in accordance with his daily business so that he can guide his job or
company in the right direction. But most people have simplified and one-sided knowledge
and sometimes even wrong perceptions and applications. The common saying that
sounds the most applicable is, “theories guide practice”. The chaotic situation on brand
definition will seriously influence the establishment, development and prosperousness of
outstanding Chinese brands, and restrict the cultivation and development of excellent
Chinese brand management elites.

Therefore, a relatively complete brand definition which can be used in practice must
be established in a short time. This definition must be able to explain different brand
phenomenon, co-exist with most brand theories and most importantly, guide brand
management practices.

The following are some attempts on brand definitions, which are onlymy personal
opinions but can be used as reference for people in the same field, so that practical
theories can be developed.

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 Three Brand Elements

I have realized that, brand essences are very affluent after spending many years’
practicing and thinking about branding theories. I believe if there is a so-called brand
existing, it should have the elements showing in the following graph:

Let me explain the three brand elements above with examples: Suppose now a
brand-new nutritional beverage will be launched in the market. This beverage is the
product that its brand represents, which we call “entity”. And then we name this beverage
as “Kinetic Energy”, and design an athletic bottle logo, which will be registered at the
trademark bureau. All of these can be called “differentiation”. Consumers are impressed
by its refreshing taste, its astonishing value of recovering energy, its beautiful packaging
and the brand which the product is representing. When “Kinetic Energy” is mentioned,
the associations above will immediately appear in consumers’ minds, and therefore all
the psychological activity is called “perception”.

How do the three brand elements effectively motivate purchase behaviors? Let us
invent a purchase process. A white-collar lady walks by a shop at the corner. She feels
thirsty and thinks that “maybe I’ll buy a drink; is that “Kinetic Energy”? I have seen its
advertisement”. The actor in the advertisement is so cool; the taste of the drink is
supposed to be refreshing and the packaging looks good. The “Kinetic Energy” in the
display caught her eye and posters on the wall remind her of the scenes in the
advertisement, so she chooses it without hesitation.

The case above draws on the outlines of the three brand elements: A Brand must
have its corresponding “entity”, products or services which will meet consumers’
demands. For example, drinks can be used to quench thirst. Effective “differentiation” will
be established between these products or services from other products and services

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through specific means. Whether this “differentiation” is effective or not is decided by
consumers’ perception, i.e. the consumers’ experience. The special perception is to
establish clear relations between “differentiation” and “entity” in the consumers’ minds;
that is to say, consumers know and are familiar with the product brand. Only in this
situation can we say the three elements are completely constructed and a brand forms.

In order to help you to understand this definition, please try to answer the following
questions: if “Kinetic Energy” is not launched in the market, can it be called a brand?

According to the definitions of the three brand elements, the present “Kinetic Energy”
can not be called “brand”. The reason is consumers have no understanding or
experience with it and therefore “perception” won’t be formed. There is only one of the
three elements so it can not be called a brand.

Testing the Theories

Can the three brand elements theory help us to clarify branding? Let’s have a look.

Starting from the difficult questions, what is brand value? Why do the same products
of different brands have different prices?

According to the theory of the three brand elements, it is easy to find that brand
value is not product or service but a value of consumers’ perceptions. For example, the
new celebrities in the entertainment industry will get some fame through purposefully
participating in certain relationships with famous people, which is called sensational
hype. Why does this happen? Because for those who are in the entertainment industry, it
will bring more opportunities if he or she has more acquaintances, and more people will
pay attention to his or her new work, which is the value of “sensational hype”. The old
saying goes that fame and interest coexist. There are many aspects to evaluate brand
value, such as perceptions on quality, partiality, reputation and loyalty, etc. It actually
sorts and quantifies consumers’ perceptions as to effectively manage their perceptions.

Consumers have different perception values for different brands, so similar products
with different brand logos will arouse different consumers’ perception values. For
example, there may be no actual difference in material, design, craftwork and pattern
between Goldlion ties and Dunhill ties, but some consumers are willing to buy Dunhill ties
paying five times the price of Goldlion ties. There may be different purchase motives but
their psychology can be easily summed up: the Dunhill brand holds value. Real
consumers seldom carry out systematic and scientific market research to obtain
complete product knowledge so as to make “rational” product decisions, which differs
from the hypothesis of traditional economics.

After understanding the three brand elements, the following questions will actually be
easy to answer: If brands equal images, than what are images? What are the relations

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between brands and images? Do these images exist in consumers’ minds or are they
possessed by enterprises?

“Brand images” are actually consumers’ “perceptions”. From a practical perspective,

we need to differentiate consumers’ perceptions. The ambiguous notion of a “brand
image” will easily lead to confusion between the consumers’ perceptions and the
intended brand image. We need to form these perceptions into a clear definition of the
brand we want the consumers to perceive.

After we clearly define “brand images” as “perceptions”, it is self-evident that the

relation between products and images is the relation between “entity” and “perception” in
the three brand elements.

So do consumers possess brands or do enterprises possess brands? For this

question, we need to ask another question: who has the right to brand ownership?
Whoever possesses the brand ownership possess both consumers’ perceptions and
values of these perceptions. While enterprises possess brand property rights, brands
actually exist in consumers’ perceptions. For example, if P&G purchases Gillette, it not
only purchases its factories, equipments, products, fixed assets, etc. but it also
purchases Gillette’s property rights for many brands and the consumers’ perception
values on these brands, which is hidden.

Let’s refer back to the theories of “brands are relations” and “brands are
commitments”. The restrictions of these theories are that they only emphasize a certain
direction, a certain function or a certain attribute, but not a complete or systematic
expression on brand essence.

Conclusion

The definition of the three brand elements theory tells us: it is the essence of brand
building to mold the perceptions in consumers’ minds through all the means available.
Since the establishment and change of consumers’ perceptions is a long and expensive
process, it’s a challenging and systematic task to establish and maintain brands.
Compare it to how much work you will do and how long it will take to make your
colleagues or friends trust you. Meanwhile, because this value only exists in consumers’
minds, it only needs a small incident to destroy this value. It was once reported that Nike
used child labor in factories abroad. Consumers stopped buying Nike products as soon
as they heard the news. Firstly, they thought Nike’s behavior was immoral. Secondly,
they thought it disobeyed consumers’ beliefs and values to buy products made by
exploited children. Actually, the product quality, the logo and slogan “Just do it” did not
change at all, but consumers stopped buying them.

A management expert once said: you had better know what you will do and then you
need to know how to do it. The purpose of this article is to explain and clarify what brands

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are. It is after we understand the definition of brands that we can further study brand
building. In following articles, I would like to discuss with you about brand establishment
theories and practice. During this process, we must remember that three brand elements
are the keys to understanding brand definition and our weapon to create international
brands in China.