In my continuing theme of talking about the basics of marketing in these first posts of my new blog, I’m moving on to a favorite topic: branding. Again, I’m harking back to some notes I made several years ago after studying the writings of many smart people on the topic of what branding (in the corporate and product sense) is all about. These notes may make the topic sound somewhat clinical or academic, but think of this as going to class. Branding and brand equity are legitimate areas of study in graduate marketing programs at the world’s best business schools. I relate more to branding as art, but there’s science to it as well. So, let’s dive in:
WHAT IS A “BRAND”?
1) A brand is a product that provides functional benefits plus added values that some prospects value enough to buy. An important distinction: a product is something with a functional purpose; a brand offers something in addition to its functional purpose. All brands are products (or services), but not all products are brands.
2) “Added values” include those that come from experience with the brand; from the types of people who use the brand; from a belief that the brand is effective; and from the appearance of the brand (e.g., packaging).
3) These added values are built over time. A brand enters the world relying almost solely on its functional properties for initial survival.
4) Branded goods are almost always sold at some premium over unbranded, a practical manifestation of a brand’s added value. Overwhelming evidence is that people are willing to pay the premium for the added value.
WHAT IS A COMPANY’S “IMAGE”?
1) Image is simply what the marketplace thinks about a given company or product… the sum total of all the perceptions out there.
WHAT IS A COMPANY’S “IDENTITY”?
1) Identity is everything a company does to shape its image, to manage how it is perceived… the sum total of all the “conversations” (literal and figurative) a company or product has with its marketplace. Not just what it says, but how it says it.
WHAT IS “BRAND EQUITY”? WHAT IS A BRAND WORTH?
1) The most important assets of many businesses are intangible… company name, brands, symbols, slogans, and their underlying associations, perceived quality, name awareness, and customer base… all of which comprise brand equity, a primary source of competitive advantage and future earnings. But brand equity doesn’t just happen. It must be nurtured, actively managed.
2) The worth of brands is well documented in individual instances, with buyers often paying substantial multiples. The valuation of brands is understandably a topic that is being increasingly studied and written about.
What’s In a Name: Advertising and the Concept of Brands, by John Phillip Jones
Image By Design: From Corporate Vision to Business Reality, by Clive Chajet
Managing Brand Equity: Capitalizing on the Value of a Brand Name, by David Aaker
Romancing the Brand, by David Martin
How to Build a Corporation’s Identity and Project Its Image, by Thomas Garbett
Juicing the Orange, by Pat Fallon and Fred Senn (founders of the renowned Fallon ad agency in Minneapolis)
Yes, I’m including that last book even though it’s ancient Apple history. It wasn’t many years after it was published that Sculley’s influence was completely overshadowed by Steve Jobs’ comeback at the company. But the book was quite influential at the time, and it was during the Sculley era that I became a passionate user (thanks also to Guy Kawasaki) — then, soon after, I decided I wanted to invest in Apple shares for the long term. Fast forward, buy-and-hold has never been a smarter strategy. There is no better brand story in the world than Apple! It has been very good to me, in more ways than one, as it has to millions of others. Its brand is consistently ranked as one of the most admired worldwide. So, I’ve truly lived the concept of “brand” — not just as a marketer, devoting my career to studying and building brands — but I’ve been lucky enough to be an owner in some of the best.
It’s simple: you just gotta believe.