From a technical perspective, a brand represents a framework of names, messages, images, colors, sounds and personality, integrated throughout a company at every point of public contact.
From a business perspective, the brand for a company is what reputation is for a person. And, similar to reputation, a brand is a long-term commitment for long-lasting results - products and people may change, management and advertising can evolve, but the brand must remain stable for a long period of time to be effective.
An effective brand can become one of the most valuable assets for a company. If the Coca Cola company lost everything except the formula and its brand name, it could walk into any bank in the world and get a $100 billion loan to start from scratch, no questions asked.
The goal of a brand is to sell the company and its products. Between two products equal in price, function and quality, the better brand will outsell the other. This can be broken down into the following main advantages of an effective brand:
- retains market share through customer loyalty
- achieves a price premium through perceived brand values
- reduces risk and cost for entering new markets / introducing new products
- limits the effect of market/product problems
And, different to the general opinion that brands are very expensive, an effective brand results in less marketing and sales costs – the best brands require the least advertising as they advertise themselves. |