What is the brand?

A brand is a special trade mark, sign, symbol, design of the product that distinguishes it from other products. Products can have subbrands. People have some beliefs and perceptions about a particular products, that is they have the brand image.

Consumers get used to some brands, and prefer to buy them. Some people drink only Nescafe, prefer mayonnaise produced by Moscow fat-producing plant (MZHK) and chocolate of Krasny Oktyabr factory and so on. In this case we can speak about brand loyalty, that is commitment to a particular brand, which people regularly buy.

Some brands have names of people. Tea brand Dilmah is composed of the parts of names Dilhan and Malik, sons of the tea producer.

Some brands have mistakes in their names. Brand of vegetable oil is called “Zolotaya semehka”, but according to the rules of the Russian language, it should be called “Zolotoye semechko”.

It takes up to 10 years to create a brand in the West. In Russia it can only take 2 years. It is known that 80 to 90% of new brands fail within their first six months.

If a company gives the name of the brand to its other products it’s called brand-stretching. By putting their familiar trademarks on attractive and fashionable new products, companies can both generate additional revenue and increase brand-awareness. So there is Pepsi Maxwear, Camel watches and Cadberry jewellery. Brand-stretching is not always successful.

A brand like Coca-Cola has been around a long time, and dominates the fizzy drink market in almost every country, outselling local brands. One of the exceptions is Scotland, and their marketing specialists are trying to find out why this is. One of the possible solutions is that people in Scotland are more conservative and keep to their traditions.

One of the most successful brands in the world is the Barbie. Created in 1959, it targeted girls who wanted to have dolls which were like young women. Its unique selling proposition is that Barbie looks like a young woman, not a baby. She has got little sisters and friends from different ethnic groups. Now there are 15,000 different items for Barbie. Costume variations and brand-stretching have been the key to her continued popularity. Her life cycle ever ends. One Barbie is bought every two seconds.

brand-stretching [΄brænd΄stret∫iŋ] «расширение» торговой марки

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THE BARE ESSENTIALS. WHAT THE BANKS ARE FOR?

The Economist, May 21, 2005.

In developed counties, nearly everyone has a bank account, because keeping cash under a mattress is neither safe nor convenient. Banks are essential feature of national life, like buses, post offices and hospitals. Any money that is not floating around as cash, in the form of notes or cons, is either sitting in a bank account, or is in transit in a payment system between banks.

Banks operate by taking deposits from private people, on which they pay low interest or none at all, and using the money to make longer-term loans to other customers, charging them higher interest rates. Banking is based on trust, but banks sometimes misuse depositors’ money or make losses on their loans, and depositors do not usually have the time, the inclination or the capacity to monitor their banks. They are happy to leave that task to governments.

Governments also help banks cope with temporary cash shortages by providing access to the ‘discount window’ so they can borrow money from the central bank. The bank deposits are often insured in a pool arrangement or by the government itself, in case the bank goes bust.

Banks are also needed to make payments, sending money from one bank account to another, whether in the same bank or in any other one the world over. Even a payment by credit or debit card, or a mobile-phone billing account, ends up as part of a transaction with a bank.

These days most banks do a lot more besides, offering a wide range of financial services. For example, they give financial advice, exchange foreign currency, deal in securities and derivatives, and manage investments on behalf of clients. Regulators have an interest in making sure that these businesses are run properly; but their chief concern remains that banks are sound, that that those deposits are safe and that the payment system runs smoothly.

Regulating banking system is an uncertain business. Banks have to be discouraged from forming protectionist cartels ad encouraged to compete with each other, but not so fiercely that they cut each other’s throats. It is a delicate balance for regulations to strike.

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