Branding is a term we have often came across, but do we really know the significance of branding and how it can make a difference in today’s world? Today all the multinational companies are using their brand names and are leaving no stone unturned to monopolise the market. Thus, it becomes imperative for us to understand why branding is such a vital part of the marketing of a product.
The market is inundated with myriad products and one thing that these products flaunt is the brand of their company. Brands carry company’s reputation with them, they are the representatives and so a company’s future basically lies in their hands. Brands were originally developed as labels of ownership: name, term, design and symbol. However, Brand names today, mean much more than what they did in the past. They are meant to inspire people, reflect and engage them to stick to their ‘favourite brand’. Powerful brands can drive successes in competitive and financial markets, and indeed become the organization’s most valuable assets. To find a brand name for the product is not mere a piece of cake but it requires an onerous effort. It is the product which is to be considered first and accordingly, its brand name is decided so that the consumer can relate the product with its brand name. The creation and subsequent maintenance of the brand is called brand management. Recognition of the brand is another aspect which speaks volumes of the popularity of the brand. The brand name should be aimed in a manner that it becomes a part of consumer’s. Promotion of brand is important and different advertising mediums are used to do it successfully. The best advertising strategy is through the word of mouth as it does not require any expenditure but no company is ever entirely dependant on it. Moreover, branding is a tool used to spread awareness of the product and at the same time, it acts as a quality substitute. The brands leave the perceptive on the consumers’ minds and that increases the brand franchise. The impression given by big brands like Nike, Adidas etc. is that they are the only ones producing the product sold by them. This is done by massive visibility in the form of millions of franchise outlets. However, there are many companies that are producing products equally worth but they are not famous like the above mentioned companies. The reason lies in effective branding which the mentioned companies have mastered or one can say are the professional, great at branding their product. Most often, it happens that companies are parsimonious when it comes to branding. They think instead of spending money in branding, making their product cheaper so that consumers flock in to buy but it is actually the opposite that happens. Increasing consumer awareness has made the consumers more mature and serious while shopping. They don’t want anything which is not going to be appreciated by others or doesn’t prove to be an “asset” for them. It is said that during a gold rush, the biggest fortunes are not made by the gold diggers but by the shovel and spade suppliers.Now, take the business of competitive exams like IIT, PMT, AIIMS etc. The gold diggers here would be the students but the main profiteers are those institutes who are in a business of tutoring. They make money not only because they are best in their fields but they have a proper strategy of monopolizing the market around them. It is not like a teacher who wants to augment his income can start something of this kind in his house. What is needed is the effective marketing of one’s product and promotion of the brand name. Coaching centres like IMS, Brilliant tutorials, Career Launcher are raking up profits. IMS have even opened their first B-school called Pracsis in Kolkata, what an effective way to use brand name!
Branding a product sometimes doesn’t solve the problem; the characters involved in the advertisements have an important role to play. Nike, Adidas etc, companies are approaching athletes, soccer players, cricketers to do endorse their range of products and are giving hefty sums in return. The strategy is clear: they know all of them are champions of their sport and if they become the brand ambassador of their product, they’ll require less effort in promotion. Nowadays in almost every advertisement, one finds the presence of a child. This is to focus on the child audience so that children end up deciding which product their parents should buy for them. Big companies like Reliance, Big Bazar, Subhiksha are multiplying their profits. They know that the customer always looks for the place where they can come do shopping and go at ease without even entering into the hassles of bargaining. They are using their brand values and have captured almost all the markets one could ever imagine. The market is growing very fast and everyone is in a hurry to grab the maximum share. Exponential growth is the mantra driving every business house in the world.
Automobile industry is one of the fastest growing industries and one main thing which chauffeurs its pace is the effective use of brand names. Ferrari, Honda, Suzuki, Chevrolet, Mercedes etc are some of the top car brands of the world which have taken the world by storm. Even in India there are indigenous car making companies like Ambassador and Maruti. It’s not that their brands don’t sell but their production and ideas lack innovativeness and creativity. We must imbibe ideas from the international car brands; they are giving more importance to the design and technology.
Samsung Electronics is a South Korean multinational corporation and the world’s largest and leading electronics and Information Technology Company. In August 2005, Business Week rated Samsung as the Number 1 consumer electronics brand in the world with revenue topping 89.5$ billion. In January 2007, Brand Finance ranked the company as the Number 1 global brand in electronics. In 2007, Samsung became the world’s second largest mobile phone manufacturer, surpassing Motorola. The company had widened its portfolio and diversified into new segments and thus deserves the place truly.
Thus brand names are vital in sustaining the market for their products and thus form an important component of image building.