5. Branding

Branding involves decisions that establish an identity(ідентичність) for a product with the goal(з метою) of distinguishing(відрізнити) it from competitors’ offerings. In markets where competition is fierce(сильний) and where customers may select(вибирати) from among many competitive(конкурентних) products, creating(створювати) an identity through branding is essential(необхідний). It is particularly important in helping position the product (see discussion of product position) in the minds of the product’s target market.

While consumer products companies have long recognized(розпізнали) the value(цінність) of branding, it has only been within the last 10-15 years that organizations selling component products in the business-to-business market have begun to focus on brand building strategies. The most well-known company to brand components is Intel with its now famous “Intel Inside” slogan. Intel’s success has led many other b-to-b companies and even non-profits to incorporate branding within their overall marketing strategy.

Brand Names and Brand Marks

At a very basic level branding is achieved through the use of unique brand names and brand marks. The brand name, which may be either the individual product name or a name applied to a group or family of products, is important for many reasons(причини) including suggesting(пропозиція) what the product is or does (e.g., Mop-and-Glow). The name is also what we utter(вимовляти) when we discuss the product (i.e., word-of-mouth marketing). The brand mark is a design element, such as a symbol (e.g., Nike swoosh ), logo, (e.g., Yahoo! graphic) a character (e.g., Keebler elves) or even a sound (e.g., Intel inside sound), that provides visual or auditory recognition for the product.

Advantages of Brands

A strong brand offers many advantages for marketers including:

• Brands provide multiple(численні) sensory(сенсорні) stimuli(стимули) to enhance(щоб збільшити) customer recognition(впізнання). For example, a brand can be visually recognizable(впізнаваний) from its packaging, logo, shape, etc. It can also be recognizable via(через) sound(звук), such as hearing the name on a radio advertisement or talking with someone who mentions the product.

• Customers who are frequent(часті) and enthusiastic purchasers of a particular brand are likely to become brand loyal(вірні). Cultivating brand loyalty(вірність) among customers is the ultimate(основна) reward(винагорода) for successful(успішних) marketers since these customers are far less likely to be enticed(менше звабляться на те щоб) to switch to(переключитися) other brands compared(порівняно з) to non-loyal customers.

• Well-developed and promoted brands make product positioning efforts more effective. The result is that upon exposure(піддаючись впливу) to a brand (e.g., hearing it, seeing it) customers conjure up(викликають в уяві) mental images or feelings of the benefits they receive from using that brand. The reverse(зворотнє, протилежне) is even better. When customers associate(асоціюють) benefits with a particular brand, the brand may have attained(здобуде) a significant(важливу) competitive advantage. In these situations the customer who recognizes he needs a solution to a problem (e.g., needs to bleach(відбілити) clothes) may automatically think of one brand that offers the solution to the problem (e.g., Clorox). This “benefit = brand” association provides a significant advantage for the brand that the customer associates with the benefit sought.

• Firms that establish(створюють) a successful(успішний) brand can extend(розширити) the brand by adding(додаючи) new products under the same “family” brand. Such branding may allow(дозволить) companies to introduce(представити) new products more easily since the brand is already recognized(впізнаваний) within the market.

• Strong brands can lead(привести до) to financial advantages through(через) the concept(поняття) of brand equity(неупередженість) in which the brand itself becomes valuable(високо цінується). Such gains(прибутки) can be realized through the out-right(прямий, повний, цілеспрямований) sale of a brand or through licensing arrangements. For example, Company A may have a well-recognized brand (Brand X) within a market but for some reason they are looking to concentrate their efforts in other markets. Company B is looking to enter the same market as Brand X. If circumstances are right Company A could sell to Company B the rights to use the Brand X name without selling any other part of the company. That is, Company A simply sells the legal rights to the Brand X name but retains all other parts of Brand X, such as the production facilities and employees. In cases of well developed brands such a transaction may carry a very large price tag. Thus, through strong branding efforts Company A achieves a large financial gain by simply signing over the rights to the name. But why would Company B seek to purchase a brand for such a high price tag? Because by buying the brand Company B has already achieved an important marketing goal – building awareness within the target market. The fact the market is already be familiar with the brand allows the Company B to concentrate on other marketing decisions.