Strategies and Importance of Branding

Table of Contents:-

Branding Strategies 

An analysis of company strategies reveals six models in the management of brand-product relationships. Each branding strategy based on the brand characteristics model denotes a certain role for the brand, its status as well as its relationship with the products. So, the major branding strategies based on brand characteristics are:

1) Product Branding: It is widely known that a brand is at the same time a symbol, a word, and a concept; a symbol since it has numerous facets and it incorporates figurative symbols such as logos, emblems, colours, forms, packaging, and design, a word because it is the brand name which serves as a support for oral or written information on the product, an object because the brand distinguishes each of other symbols, imparts its significance in other words, it’s meaning.

The product brand strategy involves the assignment of a particular name to only one, product (or product line) as well as one exclusive positioning. The outcome of such a strategy is that each new product receives the brand name that belongs only to it. Companies then have a brand portfolio that corresponds to the portfolio of their product.

2) Line Branding: The line responds to the concern of offering one coherent response under a single name by proposing many complementary products. This goes from variations of the offer, as in the case of capture or with the scents of an aftershave, to the inclusion of various products within one specific effect, as in the case of Foltene. These products are completely different for the producer but it makes no difference to the consumer, who perceives them as related. It should be clear that the line involves the exploitation of a successful concept by extending it but by remaining very close to the initial product.

3) Range Branding: Range brands bestow a single brand name and promote through a single promise a range of products belonging to the same area of competence. In range brand architecture, products guard their common name (mushroom pizza, pancakes with ham and cheese in the case of Bird’s Eye).

Range brand structure is found in the food sector (Green Giant, Campbell, Heinz, Whiskas, and so on), equipment (Moulinex, Seb, Rowenta, Samsonite) or in the industry (Steelcase, Facom). These brands connect all their products through a unique principle, a brand concept.

4) Endorsement Branding: The endorsing brand gives its approval to a wide diversity of products grouped under product brands, line brands or range brands. Johnson is the guarantor of their security and high quality. This having been said, each product is then free to manifest its originality i.e., which gives rise to the different names seen in the range. 

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Unlike the source brand, the endorsing brand gains less from its products. Each particular product name evokes a forceful image and has the power of recall for the consumer. There is little image transfer to the endorser.

5) Umbrella Branding: Under the term ‘umbrella brand’, two modes of implementation in companies, the first relatively liberal towards products and subsidiaries, the other exercising real control. Both modes shall be examined in turn; the first is in reality a house of brands, the other a branded house, 

i) Flexible Umbrella Brand: The umbrella brand strategy is characterised by a single brand level, the products are not given a daughter brand. They may be given code names, but only to identify them in catalogues or price lists. Unlike the product brand, where a brand relates to a single product and vice versa, the case of Philips underlines that here the umbrella brand covers many product categories, both figuratively and in reality. This is the principal advantage of this strategy, moreover offering a common umbrella, a common name, to a highly diversified range.

ii) Aligning Umbrella Brand (Masterbrand): This is the second version of the umbrella brand. At first glance, in formal terms, nothing distinguishes it from the previous version, the company still accepts only a single brand for the whole and therefore imposes descriptive names for the divisions and branches or products and services. The master brand prototype is Nivea. Nivea is active in a large number of categories such as moisturising creams, sunscreens, deodorants, shampoos, beauty products, and make-up. At Nivea, the categories are each sold under a variant of the name Nivea and a descriptor of the function or target. In this way, the Nivea brand range has Nivea Body, Nivea Sun, Nivea Hands, Nivea Visage, and so on.

6) Source Brand Strategy: This is identical to the umbrella brand strategy except for one key point-the products have their brand name. The benefit of the source brand strategy lies in its ability to provide a two-tiered sense of difference and depth.

It is difficult to personalise a proposition or an offer to a client without any personalised vocabulary. The parent brand offers its significance and identity, modified and enriched by the daughter brand to attract a specific customer segment. 

For example, Garnier wanted to become a source brand and abandon its previous endorsing brand strategy. This is a delicate process for it means moving from patchwork to unity.

Branding Strategies

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Importance of Branding 

Brands offer something that far exceeds the companies, products or services they represent Brands allow businesses and other organisations to communicate their intended value and values in one fell swoop. This happens when the value (features and benefits relative to the price) presented in advertising and other communications matches the value experienced in using those products or services. And, when that happens over & over again, over time, it sticks.

Brands offer something of great value they allow people to make decisions about products and services and make recommendations to others, much more quickly and easily. Consumers can put a level of trust or mistrust into something if they know it is likely to deliver on its promise. The old saying in the industry used to be “Nobody ever got fired for buying IBM”.

That is because IBM had a strong brand, based on a strong and very real reputation for reliable performance and value. This also means relatively low-importance purchases can be made without much time or research. Consider that there are thousands of products on the shelves of one grocery store. Brands allow us to walk down the aisle and grab “old reliable” time and again.

The importance of branding can be understood in the following terms:

1) To Consumers

i) Easy to Recognise: The use of a particular brand of a producer makes it very easy for the consumers to recognise the product because almost all the products of a producer are of the same brand, design, packing, colour, etc.

ii) Availability of Quality Products: The producers, who use a particular brand for their products, always keep themselves busy improving the quality of their products because they want that the demand for their products should go on increasing. The result of such efforts of producers is that the consumers get the products of the best quality.

iii) Minimum Fluctuations in Price: It has been the experience that the product prices of standard brands fluctuate very rarely.  It brings certainty to the prices of these products. 

iv) Improved Packing: The packing of standard brand products is always of high quality. The name of the brand and all the relevant particulars about the product are printed on the packing itself. The packing of such products is very convenient, attractive, and durable. 

v) Mental Satisfaction: The use of the products of a standard brand provides mental satisfaction to the consumers that they are using the goods of high quality and paying a reasonable price for these products.

2) To Middlemen

i) Easy to Understand the Needs and Wants of Consumers: The use of a brand makes it very easy for the middlemen to understand the needs, wants, preferences and requirements of consumers because the consumers ask for a particular brand. Even if the consumers do not ask for the products of a particular brand, the seller can sell the products of a famous brand easily. 

ii) Less Risk: As the demand for the products of a famous brand already exists in the market, the middlemen have no risk in keeping the products of these brands. In addition to it, the prices of products of famous brands do not fluctuate very frequently. It also reduces the risk of middlemen.

iii) No need for Advertisement and Sales Promotion: As the demand for the products already exists in the market and the customers know this product by name, there is no need for the middlemen to advertise such products because the producers of these products themselves spend the heavy amount on advertisement and sales promotion.

iv) Increase in Sales: Middlemen can easily increase their sales if they deal in products of famous brands because the market for such products already exists. 

v) Increase in Profits: As the sales of products of famous brands are high, the profits of the middlemen also increase substantially.

vi) Increase in Goodwill: If a middleman deals in the products of a famous brand it increases his goodwill.

3) To Producers

i) Easy to Advertise: When the product or producers of an enterprise are marketed with a particular brand, it makes it very easy for the enterprise to advertise its product because the enterprise can use the name of the brand in its advertisement messages.

ii) Easy to Identify the Products: The use of a brand is very helpful in the identification of products. The producers can advertise their products with their brand and consumers can identify such products easily. 

iii) Creation of Separate Market: Producers can create a distinct market for their products if they use a particular brand because the use of a particular brand differentiates these products from others.

iv) To Get More Price: When consumers like a brand and start to use the product of that brand, they do not mind a little increase in the prices of such products.

v) Easy to Expand the Product Mix: If the brand of a producer is very popular in the market and the demand for such products is quite encouraging, the producer may decide to expand his product mix. He can add new product lines to his product mix or he can add new product items to his existing product lines. It does not create any difficulty for the producer to create demand for new products because the brand has already got popularity among the consumers.

vi) Personal Contacts with Consumers: When the brand becomes popular among consumers, it becomes very easy for the producer to eliminate or reduce the number of middlemen because he is in a position to directly sell his products to the consumer. It also reduces the cost of distribution extensively.