(Posted by Abdullah and Subham Singh)
How branding is important
Branding goes way beyond just a logo or graphic element. When we think about a brand, we really want to think about your entire customer experience. Everything from your logo, website, social media experiences and customer interaction. In short, your brand is the way customer perceives the organization. It is critical to be aware of our brand experience and have a plan to create the brand experience that we want to have.
Impact on consumer
Brand image affects consumer behaviour through its influences on the consumer decision-making process. It affects the cognitive and affective components of consumer’s attitudes. Therefore positive brand image will influence the consumer evaluation and purchase intention to form a positive attitude towards a particular brand. In addition, the congruency of brand image with consumer self-concept enhances consumer preferences for that particular brand.
However, in an article by Guardian[i], despite the general belief of consumers that branding can have a positive image, it is failing in many cases. In an age of transparency and empowerment, brands are not meeting people’s requirements. People expect large companies to be involved in social problems and their quality of life but companies are not delivering on this new social contract. Two for one promotions aimed at trying to keep loyalty cannot last over the medium term[ii].
Marketing strategies varies with industries and their targeted customer. For example, a company manufacturing cooking oil or bread will depend heavily on its distribution channels to sell its product to consumers. More investment for marketing should also account for off-premise sales staff to help customer experience and buy the product.
However, for industries like electronics, cars etc. which can be distinguished as a high involvement products, consumers will perceive brands in a different way. Along with the overall value, they might be more interested with the perceived social value of the product. In such cases, organizations will have to invest heavily on promotions and advertisement through television and other mass media channels.
Coco cola, however being a low involvement product, is among one of the highest brand by value according to Forbes[iii]. As per the latest report, $3266 is the yearly spending against Pepsi’s $2400. However, to attract customer, coke has adopted a different strategy such that it becomes synonymous to carbonated beverage. More focussed on attitude and emotion value of its customer, they had a huge success over their competitors.
Take a look at this interesting video.
Brand and perceived quality
Olson’s (1977) review noted that the effect of brand name generally was strong in the price cue literature, appearing both as a main effect and as an interaction effect. However, a review of the six studies that examined both price and brand effects reveals a lack of a consistent and clear relationship. Certainly there are differences in the types of products utilized, the price manipulations, and the brand manipulations offers plausible reasons for the mixed outcomes. Monroe and Krishnan (1984) observe that brand name information dominated price information in the perception of quality. However, they discovered that price had a more positive effect on product quality perception when brand information was present than when brand information was absent. This finding suggests that the interaction of price and brand information not only is strong, but that the influence of price on quality perception becomes stronger in the presence of brand information than by itself.
Jaguar Land Rover is an iconic car taken over by Tata Motors. However, the brand name was not changed due to its equity value and recognition among people.
Puma sportswear came about thanks to a fight between brothers
Inside an air-raid shelter in World War II Germany, another battle came to a head. Brothers Adolph – also known as Adi and Rudolf Dassler – had been working together for years, selling shoes and sporting equipment, but the relationship had deteriorated. The presence of Rudolf and his family elicited a snarky remark from Adolph when they entered the bunker, and later, Rudolf was picked up by the American forces, accused of being part of the Waffen SS. He was convinced this was Adolph’s doing, and when he was released, they split their company, Dassler Schuhfabrik, with Rudolf moving across the river. The two companies that were formed are leaders in the sportswear industry today – Adidas (ADI DASsler) and Puma (Changed from Ruda, which stood for RUdi DAssler).
Procter & Gamble wouldn’t have existed if the founders had decided to stay bachelors
Englishman William Procter and Irishman James Gamble were destined to be at odds. From historically warring countries, they both settled in Cincinnatti, Procter as a candle maker and Gamble as a soap maker. They had to compete for the same materials, and the success of one would likely lead to the failure of the other. Love, however, has a way of working things out.
Both married into the Norris family, Procter to Olivia and Gamble to Elizabeth. The father of the Norris sisters, Alexander Norris, arranged a meeting between the two and convinced them to go into business together. Out of this union came Procter & Gamble, now one of the largest companies in the world – one that wouldn’t exist if not for the founders marrying sisters.
The economy of McDonald’s would make it the 68th largest country in the world
The scope of McDonalds is hard to fathom. It is the most successful fast food franchise in the world, present in more countries than any other fast food company. The company has learnt to adapt to every market it enters, and is currently the second most recognized company in the world, trailing only Coca-Cola. Nothing speaks more to the power of McDonalds than the economy it has developed encompassing its customers, suppliers, employees, and real estate ventures. If McDonalds were a country, its economy would place it 68th in the world, just ahead of Sri Lanka.