Branding is the practice of giving a specified name to a product or group of products of one seller. It is the process of finding and fixing the means of identification of a product.
Branding is the process involved in creating a unique name and image for a product in the consumers’ mind, mainly through advertising campaigns with a consistent theme. Branding aims to establish a significant and differentiated presence in the market that attracts and retains loyal customers.
A brand which is widely known in the marketplace acquires brand recognition. When brand recognition builds up to a point where a brand enjoys a critical mass of positive sentiment in the marketplace, it is said to have achieved brand franchise. One goal in brand recognition is the identification of a brand without the name of the company present.
Learn about:- 1. History of Branding 2. Meaning of Branding 3. Definitions 4. Elements 5. Objectives 6. Characteristics 7. Types 8. Importance 9. Factors Affecting the Selection of Brand 10. Brand Policies and Strategies 11. Branding Decisions 12. Advantages 13. Disadvantages.
What is Branding: History, Definitions, Elements, Objectives, Characteristics, Types, Importance, Advantages and Disadvantages
- History of Branding
- Meaning of Branding
- Definitions of Branding
- Elements of Branding
- Objectives of Branding
- Characteristics of Brand
- Types of Brand
- Importance of Branding
- Factors Affecting the Selection of Brand
- Brand Policies and Strategies
- Branding Decisions
- Advantages of Branding
- Disadvantages of Branding
What is Branding – History
Branding evolved during the 19th century.
The following are the various landmarks in the history of branding:
During this period the focus was on production only. So the companies used to mass produce without keeping in mind the customers’ feedback. The famous assembly line concept was conceived by Henry Ford for their iconic Model T car which was available to the customers in black colour only.
2. 1930s — Depression:
During this period Europe was hit by plague. It was one of the greatest depressions that world economy faced at that time. As they say ‘Necessity is the Mother of Inventions’. Some of the famous fast food brands were born during this period. Pizza Hut from USA, Dominos from Italy and Sandwiches from Russia (Subway made into a Brand).
During the war the capacity went up so there were jobs again but, a lot of belt tightening was also there. In India, Tata started TELCO, which manufactured railway wagons for the Royal Indian Army. In this era the famous Royal Enfield Bullet also made its entry into India.
After the world war ended, the production started soaring up and television started becoming popular. The world witnessed the emergence of a new form of promotion, and that is where the marketing really took off. Brands started highlighting their features in the form of USP (Unique Selling Proposition).
American marketers with the competition from the Japanese goods, entering into their markets, started soul searching. The Modern Marketing emerged to protect the American brands from facing the competition. Al Ries and Jack Trout introduced the term ‘Positioning’, which is very relevant even in today’s branding context.
There are thousands of products sold in the market.
A few examples are:
i. The rise of iconic brand Pulsar from Bajaj’s stable is a story of the statement of youth, and also of a young nation. It talks about the societal evolution of the nation. It can also be ‘Spirit of the Society’.
ii. The history of Tata is a Story of their vision. When a consumer buys Tata Brands, he buys trust. Tata is a social catalyst and the role of the brand is to inspire social stability and the spirit to be right.
iv. The history of MTV is a story of changing aspirations of the youth. It injects ‘a cool quotient’ in the society. And it recasts and reboots the social fabric.
v. The history of Infosys is a story of educational excellence in our society. Education is like a life insurance. It encourages one to achieve academic excellence.
Brands today are acting as change agents and social architects. They are building our society not only brick by brick but, also value by value. Age old brands are struggling hard to initiate a conversation in the online space. The challenge of relevance and appeal is under scrutiny. It is important for brands to build long lasting relationships.
The fight between success and love is here to stay. Success can be achieved through marketing strategies, but, winning hearts requires a meticulous and emotional connect with the consumers.
What is Branding – Meaning
A brand is a name, term, design, symbol, or other feature that distinguishes products and services from competitive offerings. A brand represents the consumers’ experience with an organisation, product, or service. A brand has also been defined as an identifiable entity that makes a specific value. Branding means creating reference of certain products in mind.
Some people distinguish the psychological aspect of a brand from the experiential aspect. The experiential aspect consists of the sum of all points of contact with the brand and is known as the brand experience. The psychological aspect, sometimes referred to as the brand image, is a symbolic construct created within the minds of people and consists of all the information and expectations associated with a product or service.
People engaged in branding seek to develop or align the expectations behind the brand experience, creating the impression that a brand associated with a product or service has certain qualities or characteristics that make it special or unique. A brand is therefore one of the most valuable elements in an advertising theme, as it demonstrates what the brand owner is able to offer in the marketplace. The art of creating and maintaining a brand is called brand management.
Careful brand management, supported by a cleverly crafted advertising campaign, can be highly successful in convincing consumers to pay remarkably high prices for products which are inherently extremely cheap to make. This concept, known as creating value, essentially consists of manipulating the projected image of the product so that the consumer sees the product as being worth the amount that the advertiser wants him/her to see, rather than a more logical valuation that comprises an aggregate of the cost of raw materials, plus the cost of manufacture, plus the cost of distribution.
Modern value- creation branding-and-advertising campaigns are highly successful at inducing consumers to pay, for example, Rs. 500 for a T-shirt that cost a mere Rs. 75 to make, or Rs. 90 for a box of lunch that contains a few rupees of worth of items.
A brand which is widely known in the marketplace acquires brand recognition. When brand recognition builds up to a point where a brand enjoys a critical mass of positive sentiment in the marketplace, it is said to have achieved brand franchise. One goal in brand recognition is the identification of a brand without the name of the company present.
Consumers may look on branding as an important value added aspect of products or services, as it often serves to denote a certain attractive quality or characteristic. From the perspective of brand owners, branded products or services also command higher prices. Where two products resemble each other, but one of the products has no associated branding, people may often select the more expensive branded product on the basis of the quality of the brand or the reputation of the brand owner.
The brand name is often used interchangeably within “brand”, although it is more correctly used to specifically denote written or spoken linguistic elements of any product. In this context a “brand name” constitutes a type of trademark, if the brand name exclusively identifies the brand owner as the commercial source of products or services. A brand owner may seek to protect proprietary rights in relation to a brand name through trademark registration.
The act of associating a product or service with a brand has become part of pop culture. Most products have some kind of brand identity, from common table salt to designer. How the brand owner wants the consumer to perceive the brand and by extension the branded company, organisation, product or service. The brand owner will seek to bridge the gap between the brand image and the brand identity. Brand identity is fundamental to consumer recognition and symbolises the brand’s differentiation from competitors.
Comparative importance of brand with regard increase in sale competency of the product is different according to the company and its product. A farmer who grows fresh peas, sells it on the basis of its price. The buyers do not see who grows them. The vendor of eatables freezes it and sells at the time when its crop is over. He packs them in fancy packets and gives it distinct recognition thereby wins the confidence of customers for his particular brand shortly. He does it mainly because of attractive package and quality peas.
Main objective of a brand is to make a distinct identification of the product. The buyers demand the same brand product and the manufacturer caters the demand of customers by supplying the same product of their choice. Brand is being used almost for all kinds of goods.
The coal, orange, furniture etc., too are being sold under a brand name in foreign countries. Application of brand for products in Indian markets has become most necessary because a number of products are sold by several manufacturers here.
The utility of brand may reduce at a time when consumer confidence and reliance for the products launched for sale will sufficiently increase. However, until accessing to that stage, recognitions of product through its brand will stand as an important factor.
What is Branding – Definitions: By Eminent Authors and Institutions: Copeland, Stanton and American Marketing Association
According to Copeland – “Trade mark has been defined as any sign, mark, symbol, word which indicate the origin or ownership of an article as distinguished from the quality and which others have not the equal right to employ for the same are brand.”
According to Stanton – “All trademarks are brands and thus, include the words, letters, or numbers which may be pronounced. They may also include a pictorial design.”
According to American Marketing Association – “A brand name is a name, term symbol or design or a combination of them which is intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.”
The above said definitions make it clear that the term “brand” is of wide scope. There may be any name, some definite words, a design or a brand joining all these into one under it. Brand is used generally by the large scale manufacturers such as – Palm mark on Dalda ghee of Hindustan Lever Ltd., Mumbai, Camel mark on the products of Camlin (P) Ltd., Mumbai, Tajmahal mark on the tea manufactured by Brooke Bond India Ltd., Calcutta etc.
The manufacturers examine very carefully the appropriateness of the brand proposed before applying the same for the recognition of their products.
There are five methods for the examination of the brand:
1. Memory Test – Several brands, name or marks are submitted under it and the community is said to recollect any name out of them. The name recollected by majority of persons is selected for the brand.
2. Preference Test – The group of people is asked to reveal their choice and the choice expressed by a majority is selected for brand.
3. Learning Test – Spelling of several names are given for writing to the people and the name duly pronunciated by majority correctly and easily; is selected for the brand.
4. Association Test – The brand names under this method are read before the public or showed them after writing on the card. They then asked writing the name which comes first to their mind.
5. Uniqueness Test – The public or a group of people are told the proposed names under this method and they are asked for writing other names matching with the proposed. The manufacturer is under this practice is duly known to the name which may be confused for the brand already prevailing in the market and as a consequence of this test, he can make a proper decision.
A manufacturer can adopt any of the methods as per his convenience and means available.
It is a question of controversy whether the use of brand is socially desirable or not. Some people consider the use of brand as an appropriate while it is improper and unnecessary in the eyes of some other persons. It is the opinion of brand favouring persons that it ensures availability of quality product and reasonable rate thereby easy selection and possibility of cheating ruled-out.
It further saves money and time both and mental satisfaction to the consumers. The person who oppose this concept says that the use of brand develops the monopoly tendency at one hand and exploits the customers by befooling them on the other. Further, it befools the customers and denies them of proper consideration for which price is paid by them.
Some prime methods of determining brand are as under:
1. On the Name of Manufacturer – Some manufacturers use their name as brand of the product. For example, Tata, Bata, Modi, Philips, Bajaj, Mafatlal etc., manufacturers have used their own name in the form of brands.
2. Special Name – Some manufacturers do not use their own name for the brands of products and any distinct name is used for the same. For example, Jai Engineering Works Ltd., Calcutta uses brand name “Usha” for its fans and sewing machines.
3. Special Mark – Some manufacturers select special mark for the brands of their products. For example. Date mark ghee, Rath mark ghee, Masai mark mustard oil etc.
What is Branding – Elements: Clarity, Consistency and Constancy (The 3 C’s of Branding)
The name, sign, symbol or design or combination of these, which is intended to identify the goods or services of one seller or group of sellers from those of others, is called the brand. Brand name is that part of the brand which can be vocalised whereas trademark is that part of brand which is given legal protection for exclusive use by a seller.
Branding is the practice of giving a specified name to a product or group of products of one seller. It is the process of finding and fixing the means of identification of a product. It is the process involved in creating a unique name and image for a product in the consumers’ mind, mainly through advertising campaigns with a consistent theme. Branding aims to establish a significant and differentiated presence in the market that attracts and retains loyal customers.
The American Marketing Association (AMA) defines a brand as a, “name, term, sign, symbol or design, or a combination of them, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of other sellers.”
Choice of a brand name requires a lot of research. Brand names are not necessarily associated with the product. For instance, brand names can be based on places (Air India, British Airways), animals or birds (Dove Soap, Puma), people (Louise Phillips, Allen Solly). In some instances, the company name is used for all products (General Electric, LG).
Brand elements, also referred to as brand identities, are those trade makeable devices that serve to identify and differentiate the brand. Brand elements that identify and distinguish one product from another, are brand names and brand marks.
1. Brand Name:
A brand name is the portion of a brand that can be expressed verbally, including letters, words or numbers, and is any word or illustration that clearly distinguishes one seller from another. A brand name usually takes the form of words such as Dove, Puma, LG, Adidas, Nike, etc.
2. Brand Mark:
A brand mark is a portion of a brand that cannot be expressed verbally. This includes a graphic design or symbol. The brand mark is thus the element of the visual brand identity that does not consist of words, but of a design and symbol, such as the symbols for above mentioned brand names.
There are three main characteristics which should be there in branding.
1. Clarity – Strong brands are clear about what they are and what they are not. They understand their unique promise of value and this promise of value sets them apart from their competitors. It differentiates them and allows them to attract and build loyalty among a desirable set of consumers.
2. Consistency – In addition to being clear about who they are, strong brands are also consistent. They are always what they say they are.
3. Constancy – It is not enough to be clear and consistent if you are not always visible to your target audience. Strong brands are constant; they are always there for their customers and prospects.
Brands are so numerous and common-place that we are inclined to take their significance for granted. In the grocery products area alone, there are many thousands of brands, even though a large supermarket will carry a few thousands.
Branding started in the middle ages when craft guilds (similar to labour unions) and merchant guilds formed to control the quantity and quality of production. One requirement was that each producer marks goods so that output could be restricted when necessary. This also meant that inferior quality, which might reflect unfavourably on other guild products and discourage future trade, could be traced back to the fending producer.
Early trade-marks also were a protection to the buyer, who could now determine the source of the product.
More recently, brands have been used primarily for identification rather than restriction of output.
The earliest and most aggressive brand promoters in American were the patent medicine manufacturers. They were joined by the food manufacturers, who grew in size after the Civil war. Some of the brands started in the 1870s are still going strong.
Today, a good brand usually assures high or at least consistent quality and encourages repeat purchasing. This works where there is some trust of sellers by buyers. This is generally true in Zimbabwe but much less so elsewhere.
Customers are willing to buy by brand rather than by inspection when there is some assurance of quality. In many countries, however, the consumer doesn’t feel any such assurance. In India, for example, inspecting the product is common because there is a complete lack of confidence in packaged goods and brands.
This distrust has a solid foundation. Foods are often adulterated with saw dust, husks and coloured earth, which may account for 10-50 percent of the weight of packaged or prepared foods. An Indian car battery manufacturer has had great success with his brand by correctly advertising “The battery you don’t have to test” and delivering a dependable product.
Most marketing managers accept branding as desirable and are primarily concerned with assuring the success of the brand name of the product(s) they are marketing.
1. The demand for the general product class or in the selected target market(s) should be large enough to support a profitable marketing plan.
2. The demand should be sufficiently strong so that the market price will offer a large enough margin over additional promotion cost to make the effort worthwhile.
3. It is best when there are economies of mass production. If the branding were really successful, the cost of production would decline with additional volume, thereby increasing profits.
4. The product quality being offered should be the best for the price in the market being served and the quality should be easily maintained.
5. The product should be easily identifiable by a brand or trade-mark. This is easier said than done. Many products do not lend themselves easily to conspicuous marking. Few consumers would like to have a furniture manufacturer’s label sewn conspicuously on their sofa or lounge chair. But if the label or mark is inconspicuous, then much of the brand prestige value is lost. Some producers are ingenious in placing labels. Walnut and Orange growers stamp their brand names directly on their products; and large meat-packers place metal foil brand labels inside self-service meat packages.
6. Consistent and wide-spread availability is necessary. When customers start using a brand, they should be able to continue finding it in their stores.
7. Brand promotion will be more successful if the brander can be assured of favorable positioning in stores. For some manufacturers, this is just a hope or a goal for their sales people. But when wholesalers and retailers brand their own products, this is something they can control.
What is Branding – Objectives
To succeed in branding a seller must understand the needs and wants of his customers and prospects. He does this by integrating his brand strategies through his company at every point of public contact.
A brand resides within the hearts and minds of customers, clients, and prospects. It is the sum total of their experiences and perceptions, some of which a seller can influence, and some that he cannot.
A strong brand is invaluable as the battle for customers intensifies day by day. It’s important to spend time investing in researching, defining, and building a brand. After all, brand is the source of a promise to its consumer. It’s a foundational piece in marketing communication and one a seller does not want to be without.
(i) Delivers the message clearly
(ii) Confirms seller’s credibility
(iii) Connects seller’s target prospects emotionally
(iv) Motivates the buyer
(v) Concretes user loyalty
(vi) Assists in product promotion
(vii) Serves as weapon to protect market
(viii) Serves as antidote for middle man survival
(ix) Creates product identification for customers
What is Branding – Characteristics
Branding is the management process by which a product is branded. In selecting a good brand name various aspects require careful consideration.
The following are the few general characteristics of a brand:
1. The name should readily come to the minds of customers. It should be easy to pronounce.
2. The name should be easy to read and understand
3. The name should be appropriate for the product.
4. It should be easy to remember.
5. It should, as far as possible, be most descriptive in nature.
6. It should be different from other brand names.
7. It should be registered so that any other firm might not take advantage of its popularity.
8. Brand name should be helpful in advertisement.
9. It should be short and pointing.
10. It should be far from obsolescence.
11. It should be economic so that it could be easily printed, embossed on packages.
12. As far as possible it should be heart touching as to influence the mind of the customer and catch his imagination.
What is Branding – Types: Classified According to the Ownership, Market Area, Number of Products and Use
Brands can be classified on following basis for the sake of convenient study:
1. According to the Ownership:
The shapes of brands on the basis of ownership are divided as below:
i. Manufacturer’s Brand:
The brand used by the manufacturer for his products is called Manufacturer’s Brand. For example, Philips Co. uses brand name for its all products such as – bulb, tube light, radio, transistor, and two-in-one etc. Similarly, Godrej Co. uses brands for its products like — soap, typewriter etc.
ii. Middlemen’s Brand:
When the manufacturer or producer do not use brands for their products, some distributors, wholesalers or retailers sell these under their own brands for the sake of marketing convenience. These brands are called Middle- Men’s Brand. For example, Lal Quila, Tajmahal, Golden etc., for rice.
2. According to the Market Area:
The brands are divided in five classes on the basis of their market:
i. Local Brand:
When any brand is used for any local market, it is called Local Brand. Some manufacturers use separate local brands for the distinct local markets.
ii. Provincial Brand:
When any brand is used for any province or particular state, it is called Provincial Brand. Some manufacturers use separate brands for different provinces.
iii. Regional Brand:
When any manufacturer distributes the market for his product in the district regions of the nation and uses separate brand for each such region, these are called Regional Brands.
iv. National Brand:
When any manufacturer uses only one brand of his product for entire country, it is called National Brand.
v. International Brand:
When any manufacturer uses single brand for international business, it is called International brand.
3. According to the Number of Products:
The brands can be classified three ways on the basis of the number of products:
i. Family Brand:
When any commercial undertaking uses a single brand for its all products, it is called family brand. For example, Bajaj Group of companies uses the term Bajaj for all its products like – bulbs, tube light, iron, toaster, scooter etc. Some other examples of family brand are – Tata, Bata, Modi, Godrej, Lakme, Usha, Parag etc. Family brand is also called Blanket or Umbrella Brand.
ii. Product-Line Brand:
When any commercial undertaking uses distinct brands for its different product-lines, it is called product-line brand. For example, Dalda for product-line brand of vanaspati ghee and Super Surf for product line brand of detergent powder.
iii. Individual Brand:
When any commercial undertaking uses different brands for all its products, it is called Individual Brand. For example, Hindustan lever Ltd. uses various brands like Lifebuoy, Lux, Rexona, Supreme etc., for its toilet soaps. Similarly, W. D. H. O. Wills uses distinct brands for the cigarettes manufactured by it. Some of them are – Wills, Wills King, Wills Flake, Capstan, Star etc.
4. According to Use:
The brands are classified two ways on the basis of uses:
i. Fighting Brand:
The manufacturers launch the product of low price in the market at a time when an acute competition is prevailed in the market. The brand of such product is called Fighting Brand. For example, S. T. C. Ltd. has launched Filter Kings brand of cigarette recently in the form of a fighting brand.
ii. Competition Brand:
When no particular distinction is seen in the shape and size, quality and price of products of various manufacturers, such brand of different manufacturers is called Competitive Brand. For example, Modi Soap, Thick Soap etc., in washing soaps.
What is Branding – Importance: Business to Customers and Business to Business
Branding has the following importance associated with different categories:
i. Ease to Recognise:
The existence of the brand name allows the consumers to identity the brand in the market. This is because the brand has distinctive packaging, colour, design, etc.
ii. Quality Products:
A brand is an assurance of quality. Even the producers have to make constant efforts to invest in R 8s D etc., so that they offer quality product and fulfil the brand promise. Consumers therefore get an assurance of quality when they buy a brand.
iii. Regulates Fluctuations in Price:
It has been seen that price fluctuation do not occur in brands. Consumers therefore get assured prices.
iv. Improves Packaging:
The packaging of the brands is given lot of importance. The name of the brand and other details are included in the brand packaging. The packaging itself has to undergo a constant innovation in terms of look and feel so that the quality perception of the brand is maintained.
v. Mental Satisfaction:
The use of brands by consumers also gives lot of satisfaction to the consumers as it gives them a feeling that they are using a superior product. For many consumers it can often be the feeling of pride like owners of Mercedes and Harley Davidson.
Brands are an effective and compelling means to “de-commoditize” product categories that are highly undifferentiated.
ii. Secure Future Business:
Quite often it is important to establish brands for your products or services in order to prepare for the future. There are many business areas where only those companies survived that chose to brand their products from the beginning.
iii. Create Brand Loyalty:
Brands assist companies in transitioning from a transaction-based selling model to one that is relationship based. The customer always comes first. Brand loyalty is created when the business manages to consistently deliver on what its brand promises.
iv. Differentiate Marketing Efforts:
Businesses with strong brands can benefit from increased communications effectiveness. Marketing efforts will be more readily accepted than those of complete no-name products and services.
v. Create Preferences:
Brand preference at its best leads to the rejection of competitive brands. A strong brand, however, will act as a barrier to people switching to competitors products.
vi. Command Price Premium:
A business with well- known brands can command premium prices for their products and services. It makes it automatically less susceptible to competitive forces. That business-to- business brands are valuable resources is also reflected in the acquisition prices. Brands can balloon these prices tremendously.
vii. Create Brand Image:
Brands enable company’s value propositions to be more emotive and compelling. Above all, a positive brand image also appeals to all other stakeholders it makes it even easier to recruit and retain talent.
viii. Increase Sales:
The main goal of most business is to prosper. Companies with strong brands can benefit not only from higher margins but also from high sales volume.
What is Branding – Factors Affecting the Selection of a Brand
Every producer should take extreme care at the time of determining the brand for any product as this very brand may become either boon or curse for him. He is free to select a brand in the form of any name, picture or mark voluntarily.
Following facts are given special care at the time of brand selection for any product:
1. Brand’s Name – The name of brand for a product should reveal the characteristics of product. For example, Coco-Cola as it contains a meagre quantum of Co-Co that gives freshness and energy.
2. Simple and Short – Brand name should be simple and in short form so that it could understand easily and no difficulty occur for keeping in memory. For example, Postman, Dalda, Panghat, Usha, Murfi etc.
3. Easy Pronunciation – The brand should be so easy to pronounce as no difficulty faced by the children youngster, old, women, literate and illiterate, rural and urban etc., people and it could be pronounced easily in several languages. For example, Tajmahal, Amul, Parag, Binaca, Bata etc.
4. Recognisable – The brand should possess a characteristic for easy recognition i.e. its image could introduce to the eyes.
5. Heart Touching – The name of brand, its mark and picture should be of such nature as to merge with the mind and heart of the viewer and could impress him.
6. Different from other Brands – The brand of every product should be distinct from that of others so that no confusion is created.
7. Brand’s Registration – The brand should be easy to avail registration and no other manufacturer could use it for cheating.
8. Helpful in Advertising – The name and mark of a brand should be selected so skillfully that it may make the advertisement more attractive.
9. Far from Obscene – Any type of vulgarity should not be demonstrated through the brand viz., such a name or picture should not be used which is absent from the eyes of society.
10. Economical – A good brand should be economical viz., no more expenditure should be incurred on printing, writing or exhibiting the same.
11. Suggestive – Brand name should be in the nature that it could attract the customers by virtue of its framing. For example. Milkmaid, Kesavardhini oil etc.
The name of brand, mark or picture de-facto represents the undertaking. The popularity and goodwill of the undertaking is increased and prospects of products become better if the brand is once selected with extreme care and attention.
What is Branding – Brand Policies and Strategies
Brand policies and strategies can be classified under following heads for the sake of convenient study:
1. Brand policies and strategies adopted by the manufacturers.
2. Brand policies and strategies adopted by middlemen
3. Other Brand policies and strategies.
Following is the brief description on them:
1. Brand Policies and Strategies Adopted by the Manufacturers:
Following policies and strategies are included with it:
i. Marketing under Manufacturer’s Own Brand:
The manufacturers sell their own products under their own brand name under this strategy.
They can select any of the brand strategies out of the following- (a) Individual Brand (b) Product Line Brand (c) Family Brand (d) Local Brand (e) Provincial or State Brand (f) Regional Brand (g) National Brand (h) International Brand (i) Fighting Brand (j) Competitive Brand etc.
By adopting this strategy – (a) Popularity of manufacturer is increased (b) It facilitates advertisement and sales promotion programme of products (c) Stability is maintained in product price (d) Market can be controlled easily and (e) Assists in product-mix.
It is the prime defect of this strategy that the mediators often do not inspire the sale of any brand products of the manufactures.
ii. Marketing under Middlemen’s’ Brand:
The manufacturers do not use any brand for their products under this strategy viz., the manufacturers sell their products without any brand to the middlemen. The middlemen in the circumstance, sell the products under their own brand names.
By Adoption of this Brand Strategy – (a) The manufacturer needn’t concentrate on marketing of his products; (b) The manufacturer can use all his sources for the best production. Only shortcoming in this strategy is that the manufacturers have to live under the mercy of middlemen.
It middlemen receive the products of other manufacturer at relatively lower price, they stop purchase of the products manufactured by old manufacturer. It sometimes, make the old manufacturer to suffer much.
2. Brand Policies and Strategies Adopted by the Middlemen:
Following brand policies and strategies are included in it:
i. Use of Manufacturer’s Brand Only:
The middlemen under this strategy sell only the products of particular manufacturer viz., they do not use their independent brand.
By Adoption of this Strategy – (a) The middlemen needn’t do any special endeavour for the sale of product and – (b) Irrespective of lower profit ratio, the middlemen receive more profits on account of large scale marketing. It is only defect of this strategy that the middlemen cannot create their own goodwill in the market.
ii. Joint Use of Manufacturer’s Brand and Middlemen’s Brand:
The middle-men under this strategy sell the products of their own brands coincide the branded products of the manufacturers.
By Adoption of this Strategy – (a) Middlemen establish their identity and grow (b) As normally, the products under brands of middlemen are cheaper than the branded products of manufacturer and quality difference is found minimal, the consumers’ therefore, are attracted towards the middlemen’s brands and – (c) The middlemen are duly controlled as they fear of their stand in the market if products are not given by the manufacturers.
The only shortcoming of this strategy is that the manufacturers do not prefer such middlemen as the sale of manufacturer’s brand is always subdued-.
3. Other Brand Policies and Strategies:
Some other policies and strategies of branded products are as under:
i. Multiple Branding Policy- A commercial undertaking under this strategy uses separate brands for its different products.
ii. Product-Line Branding Policy- The commercial undertaking under this strategy, uses different and distinct brands for its different product lines.
What is Branding – Branding Decisions
The name, sign, symbol or design or combination of these, which is intended to V. identify the goods or services of one seller or group of sellers from those of others, is called the brand. Brand name is that part of the brand which can be vocalised whereas trademark is that part of brand which is given legal protection for exclusive use by a seller.
Decisions relating to branding forms an important part of export marketing.
1. To Brand or not to Brand:
Branding is very costly and risky but at the same time very advantageous. In the recent times because of the increase in the sale of the non-brand product, a firm has to decide carefully whether to brand or not to brand the product.
2. Private or Manufacturer Brand:
Exporter has to make another decision regarding whether to go for the manufacturers brand or private brand i.e. distributer’s brand of foreign seller. Sometimes it is very difficult for the small exporters to sell their exports under their own brand name. In such cases goods exported under domestic brand name are repacked abroad and sold under foreign brand names.
3. Same Brand or Different Brand:
A major decision to be made by the exporter is to decide whether to use same brand in the domestic and foreign markets or not. Difference in the culture and other factors makes it impossible to use the same brand in all the markets. For instance, colours, symbols have different significance in different cultures.
What is Branding – Advantages: To Producers, Middlemen and Consumers
The advantages accruing from the brand are as under:
1. Advantages to Producers:
The producers receive following advantages through application of brand for their products:
(a) Easy to Advertise – The producers mark their product with their particular brand and use that mark in their programme. The customers are much influenced of their brand. Generally, the customers prefer using the products of a particular brand. Brand is very helpful for the advertisement of a product.
(b) Products’ Identification – Customers are duly introduced with the products through brand application and they are inspired permanently for selecting their own brands.
(c) Creation of Separate Market – The producer can build a separate market for his products by advertising his particular brand. It also assists re-sale.
(d) To Receive More Price – When the customers become habitual of use of any particular brand, they prefer buying of the same products irrespective of price increase. For example, tea, cigarettes, sliced bread etc., are used by customers according their favourite brand.
(e) Easy in the Expansion of Products Mix – If any brand of a particular producer is prevailing in the market viz., preferred by the customers, other products in the circumstance, can also be included in the product-mix because special efforts to introduce new products in the market are not required.
(f) Personal Contacts with Customers – The number of middlemen can be reduced when the brand becomes popular in the market and excess profits earning through reduction in cost of marketing is also possible by direct contacts with the Customers.
The middlemen receive following advantages through the application of brand:
(a) Easiness in Consumers’ Understanding – It is generally seen that customers themselves raise demand for the products of particular brand. The middlemen in the circumstances, understand the necessities of the customers. Apart from it, middlemen require no special efforts for the sale of product of a familiar brand even if the customers do not demand for any particular branded product.
(b) Less Risk – Least change in prices of branded product takes place. Being this position, there is least risks as to upheavals on part of middlemen.
(c) No Need of Advertisement and Sales Promotion – The middlemen require no expenses to incur on advertisement and sales promotion for the branded products because the manufacturers themselves incur substantial expenses on their advertisements and sales promotion programmes.
(d) Enhancement in Goodwill – The middlemen acquire the benefit of goodwill automatically on sale of branded items.
The consumers acquire following advantages through application of the brand:
(a) Easy to Recognise – The consumers recognise the product immediately in the market as all products covered by a single brand bear the same colour and design. Hence, the consumers needn’t special efforts for having the products of their choice.
(b) Improvement in the Quality of the Product – The producer always does efforts for quality improvement for maintaining the goodwill of its product in the market. Its advantage goes to consumers in the form of having quality goods for consumption.
(c) Certainty of Price – Same price for a certain brand of product is found at every place. The consumers therefore, avoid from cheating.
(d) Packing of Good Quality – The name and mark of a brand is generally printed on the products. Endeavours therefore, are made for firm and attractive packaging. It enhances the safety of the product.
(e) Guaranteed Quality – Generally, the quality of branded goods is found good. The consumers receive best quality products for their use.
(f) Mental Satisfaction – The consumers receive mental satisfaction when they use the product of superior brand. They feel that a good quality product is being used by them and that too on competitive price.
What is Branding – Disadvantages
There are several manufacturers who do not use brand for their products.
Abstaining from brands generally takes place due to following disadvantages:
1. Demand Stimulation – The manufacturers who are not prepared for taking over the responsibility on account of advertisement, sales promotion and others in order to increase the demand for their brand, do not ascertain any brand for their products.
2. Constant Quality Maintenance – It becomes the responsibility of the manufacturer of a product to maintain the quality of branded goods, but some manufacturer want to avoid from this liability and do not use therefore, any brand for the products manufactured by them.
3. Consumer’s Dissatisfaction – One of the main reason for non-utilization of brand is to escape from the losses that usually take place as a result of consumers’ dissatisfaction. If the customers are not satisfied with the brand of any products, they pressurise on replacement and do not re-buy the same. It is also possible that they may stop the purchase of other goods covered under the same brand.
4. Difficulty in Differentiation – The products which cannot be differentiated on ground of being pari-material, brand is not made for them. Some goods of this nature are- screws, pins, coal, cotton etc.
5. Nature of Items – The goods like fresh fruits, vegetable etc., are of such nature that no branding can be applied for them.
6. Below the Regular Quality – The manufacturer abstains from branding of a product if it is below the regular quality of his products.
It is thus clear that brand should be used only when the manufacturer is ready to maintain the quality regularly and have capacity to perform the responsibility for sales promotion and advertisement too.