Importance of Branding - 3

In today’s global business world organisations need teach the importance of branding to their internal customers (employees). Employees who know their jobs’ importance in their brand’s success will contribute more than who doesn’t know. Believe in your brand name, what it means, and customers will follow.

Time, money and effort spent on branding come back many times over when the process plays out intelligently. According to a privately held online publisher of home business and small business information Powerhomebiz, branding fattens companies’ bottom line for the reasons stated below:

1. Memorability: It is much easier to remember a branded product than a unknown, what was its name? product.

2. Loyalty: People tend to buy brands that they tried in the past and have positive experience with those products. We can say consumers are loyal to the brands they trust and are pleasant to buy them.

3. Familiarity: Psychological studies have shown that familiarity induces liking which makes even non-customers more likely to recommend a brand they know.

4. Premium image - premium price: Generally customers are willing to pay more for the well-branded products or services.

5. Extensions: It is much easier to introduce a new product or service with the help of your gained respect and success with your existing well-known brand.

6. Greater company equity: Companies with more brand value cost more than the companies with the same size but not well-branded when they are under sale.

7. Lower marketing expenses: You need to invest really big money to create a strong brand but once it is created you get big advantage over your competitors in every kind of marketing campaigns.

8. For consumers, less risk: When you afraid of the consequences of a mess-up you tend to choose the brand-name seller instead of the no-name one.

Keller (2003) stated the roles of brands to consumers and firms. According to Keller (2003) there are seven roles of brands to consumers. Brands provide:

 identification of source of product
 assignment of responsibility to product maker
 risk reducer
 symbolic device
 signal of quality
 search cost reducer
 promise, bond or pact with maker of product.

Keller (2003) claimed six different roles of brands to firms, they provide:
 means of identification to simplify handling or tracing
 signal of quality level to satisfied customers
 source of competitive advantage
 source of financial returns
 means of legally protecting unique features
 means of endowing products with unique associations

Importance of Branding - 2

Branding adds value to products and services. This value arises from the experience gained from using the brand; familiarity, reliability, and risk reductions; and from association with others who use the brand (Palumbo and Herbig, 2000).

Generally, consumers really don’t think much about the importance of branding in their daily life. They just go and buy the brand, they trust like most people do. But the name of a brand comes crucial when the business point of view is under discussion. For instance the importance of a brand name can be expressed with the help of a well known brand “Nokia”, when consumers hear Nokia; they think mobile phones and the slogan of Nokia: “Nokia, connecting people.” came in their mind. A strong brand name and slogan has taken Nokia to the top of its industry.

Choosing a brand name is not a process happening by chance. It is a well thought out process which really needs to think about the analysis of names and meanings. Creating a simple name for the company is the starting point of branding, so it can be said it is the most important step of branding. Because usually consumers remember simple and short names, there is a need to find a simple name which is associated with a positive value or characteristics (Kapferer, 2004, p. 155). An example can be given from Turkey about the shortness of a brand name; Dogus Group use “Garanti” instead of “Garanti Bankası”.

Another vital point in choosing the brand name is that the brand name must be different and unique (Fuchs, 2005). It will result as revenue lost if the company brand name is too close to one of its competitors which will cause its customers’ to mix it up. Also companies can not reach success by using a close name of a brand which came in market before them.

Importance of Branding - 1

The first impressions on customers play a crucial role. The company logo and corporate identity will be seen by thousands even millions of people depending on business area, and is marketing managers’ first chance to make a long lasting impression on company’s target customers. The brand gives companies a chance to communicate their corporate vision and set them apart from their competitors.

It is really important to have a perfect strategy behind the company brand, which will allow the transition of managers’ ideas to reality. Firms can stand out over and stay above the competition instead of getting lost in the crowd by the help of a strong and memorable brand. According to branding experts of Potential Difference, a brand management consultancy firm, a strong brand is firstly built on trust and reinforced over time with every kind of communication channels which are displaying a clear and consistent message, all contributing to its success in the marketplace.

In an increasingly complex world, individuals and businesses are faced with more and more choices, but seemingly have less and less time to make those decisions. The ability of a strong brand to simplify consumer decision making, reduce risk and set expectations is thus invaluable. Creating strong brands that deliver on that promise and maintaining and enhancing the strength of those brands over time is thus a management imperative (Keller, 2003).

According to Kapferer (2004, p 33) branding means much more than just giving a brand name and signalling to the outside word that such a product or service has been stamped with the mark and imprint of an organisation. It requires a corporate long-term involvement, a high level of resources and skills.