BRANDING

 A crucial step in the branding strategy is deciding on a specific brand name for the product that is being introduced. In the earlier times when the concept and practice of branding was much less developed, very often the family name/surname was used. Some of those are still very much alive, for example, Siemens or Ford. The other common method of branding was by way of addressing the product range of the company. Two famous examples are General Motors and General Electric. It seems the function that brand was supposed to perform was either to indicate the source or the origin of the product (family name) or indicate the product range. However, a brand name has emerged as one of the most important elements of the merchandising function in the recent times and will become more and more crucial as the competition becomes more severe in India. Let us understand what the conceptual meaning of the terms brand and brand name is.

Brand: Brand is a word, mark, symbol, device or a combination thereof, used to identify some product or service. The definition clearly focuses on the function of a brand, that is, to identify, irrespective of the specific means employed for the identification.

Brand Name: The American Management Association defines it thus: "Brand name is a part of a brand consisting of a word, letter, group of words or letters comprising a name which is intended to identify the goods or services of a seller or a group of sellers and to differentiate them from those of competitors."
 

Comparing this definition with that of a brand, it is found that the function remaining the same, brand name is only one of the means that the brand can use for identification. Brand name is a word or a combination of words/letters that is pronounceable, e.g., Promise toothpaste, Lux soap, etc. Sometimes you must have also heard words like brand mark and trade mark. Since a brand name is used in identification of a product amongst a competing set, it is necessary that each brand must have only a unique identity and it must also be protected by law. This brings in the concepts of brand mark and trade mark.

A brand mark is a symbol used for the purpose of identification. It can be a mark, a design; a distinctive logo type or a colouring scheme, a picture, etc. In other words, it is not a name but a means of identification, e.g., picture of an elephant in a distinct frame used by the Department of Tourism, Government of India or the famous star-circle of a Mercedes Benz car, or T circle which you must have seen on buses and trucks made by TELCO. A trade mark is the legalised version of a brand. Brand falls under the category of industrial property rights and, therefore, subject to certain rules and regulations, it can be registered and protected from being used by others. ‘A brand or a part of a brand that is given legal protection because it is capable of exclusive appropriation' is defined as a trade mark. It is strictly speaking a legal concept, even though brand and trade mark are quite often used synonymously

Branding Decisions

Having an appropriate brand has emerged as the most important activity in the area of marketing of products especially consumer products. Several decisions need to be taken, though not simultaneously, with regard to brand selection and its use. These are:

1) Should the product be branded at all?

2) Who should sponsor the brand?

3) What quality should be built into the brand?

4) Should each product be individually or family branded? Should other products be given the same brand name?

5) Should two or more brands be developed in the same product category?

6) Should the established brand be given a new meaning (repositioning)?  

Let us consider each of these issues:  

1) Whether to brand a product or not is a decision which can be taken only after considering the nature of the product, the type of outlets envisaged for the product, the perceived advantages of branding and the estimated costs of developing the brand. Historically, it is found that brand development is closely correlated with the increase in the disposable income, the sophistication of the distribution system and the increasing size of the national market. The same trend is visible in India now. 

Even few years back, nobody could have thought of selling branded rice or refined flour and Iodized Salt, but several firms in the recent past have become successful even in such product categories. The basic reason is that a class of consumers is willing to pay more for uniform and better quality product represented by the brand. Irrespective of the location and from which retailer they buy, customers are always buying the same product attributes when they buy a branded product. Many other commodities, such as spices are also now being branded. There is no doubt that this trend will become stronger in the coming years.

2) The question of sponsorship of a brand refers basically to the decision as to whether it should be a manufacturers' brand, also known as a national brand or a private brand, also known as a middleman's brand. This is a major decision in most developed countries where large chain/departmental stores dominate the retail distribution system. This is, however, largely a hypothetical question in India, where retail distribution system is highly fragmented. Only Super Bazars have started marketing a few products which are specially packed and sold under their names. However, if outlets of Super Bazars, Mother Dairy and National Consumers Cooperative Federation increase in sufficient numbers, it is possible that private brands will also become a reality in future. Some retailers' brand names in the product categories of sarees and car accessories have already been established.

3) A very crucial decision is with regard to the quality and other attributes to be built into the product. The matrix of such attributes will decide the product positioning. A marketer has the option to position his product at any segment of the market: top, bottom or the intermediate. Taking an example, Surf is positioned as a premium quality and high priced product. At the other end of the scale, Nirma is positioned as low priced, while products such as Det or Key are somewhere in between.

4) The marketer also has to decide at the outset whether he would like to adopt a family brand under which all the products of the company would be sold or he would like to brand each product separately.  

Companies like GE or Philips follow the family name strategy, while GM follows the individual brand strategy. In India, L&T and Kissan are examples of the former, while Hindustan Lever follows the latter.

These are advantages in either approach:

a) Family Brand

i)     One basic advantage of using the family brand is that it reduces the costs of product launching and ongoing promotional expenditure substantially. The firm has to promote only one brand which, if successful, would be able to sell the entire product line. Lining up the distribution channel members also becomes comparatively easier. A family brand name has been found to be very cost effective in tyre marketing.

ii)   If one product does exceptionally well, it is perfectly possible that there would be positive fall-outs for other products being marketed under the same brand.

iii)  It is, however, necessary to be cautious in following this strategy. It will be a very ill-advised strategy if the products being offered are of highly uneven quality. It may not also be a good strategy if the markets are quite dissimilar in terms of consumer profile.

iv)  A greater weakness of this strategy is that it does not recognise that each product can be given a specific identity by a suitable brand which can go a long way to make it successful.

b) Individual Brand

i)     The weakness, as pointed out above, becomes the principal strength of this strategy. Recent consumer researches have irrefutably established that a name can have varied associations and conjure diverse images. These psychological factors can immensely influence the buying decisions. Individual brand strategy is in a position to take care of this aspect of marketing.

ii)   The second advantage of this strategy is that if there is a product failure, its damaging effect will be limited to that particular product and will not extend to the entire product line.

iii)  The basic disadvantage lies in the economics of developing an individual brand. It is obviously a costlier strategy than the other.

iv)  The other disadvantage is that the brand does not directly derive any benefit from the reputation of the firm.

To take care of these problems, some firms follow a slightly modified strategy. This involves using individual brands but also giving prominence to the company name or logo in all promotional campaigns as well as in product packaging. For example, TOMCO follows individual brand strategy but displays prominently the words. ‘A TATA PRODUCT'. In many cases a brand extension strategy is adopted. This really is an effort on the part of the manufacturer to secure additional mileage from a particularly successful product for launching either similar or even dissimilar product under the same brand. A recent successful example is the decision to introduce Maggi range of sauces to capitalise on the image of Maggi brand of noodles.

5) A firm may decide several brands of the same product which to some extent are competing inter se. The basic reason is that, at least in the consumer products, various benefits and appeals and even marginal differences between brands can win a large following. Do you recall that in Unit 11 we discussed the illustration of a company which has several soaps, under different brands for different segments?

Brand Repositioning

Over the life cycle of a product, several market parameters might undergo a change such as introduction of a competing product, shifts in consumer preferences, identification of new needs, etc. All and each of such changes call for a relook as to whether the original positioning of the product is still optimal or not. Stagnating or declining sales also point to a need for reassessment of the original product positioning. For example, Thumps Up has been repositioned several times in the recent past, from the young to the professionals to the kids and hack to the young.

BRANDING: ADVANTAGES AND DISADVANTAGES

Branding as an aspect of product marketing can be analysed from two different standpoints: that of buyers and of sellers. It is also possible to have a societal viewpoint.

a) Buyers

The buyers can derive several advantages:

i)     A brand generally denotes uniform quality.

ii)   It makes shopping easier.

iii)  Competition among brands can, over a period of time, lead to quality improvements.

iv)  Purchasing a socially visible brand can give psychological satisfaction to the buyer.

There are, however, some negative aspects as well

v)   Since brand development costs money, product prices tend to go up.

vi)  Taking advantage of the popularity of a brand, a manufacturer may reduce quality gradually.  

b) Sellers

A marketer can also derive certain advantages such as:

 

i)     It helps in product identification.

ii)   In a highly competitive market, it can carve out a niche for itself through product differentiation.

iii)  If brand loyalty can be developed through successful promotion, the firm will be able to exert quasi-monopolistic power.  

But to obtain the advantages, it is necessary for the manufacturer to invest resources in promoting the brand name.

c) Societal view

From a macro-standpoint, a brand's role in improving and maintaining product quality can be considered as positive. Brands also help in better dissemination of product knowledge; better knowledge can contribute to more scientific and rational decision making.

There is, however, an opposite view as well. Many critics feel that branding often leads to higher costs and therefore prices. It can also allow the manufacturers to get higher returns than normal through excessive or strong brand loyalty.

SELECTING A BRAND NAME

Finding an appropriate name for a new product is a tricky job, basically for two reasons. Firstly, the name should be one which satisfies several marketing criteria some of which are discussed below. Secondly, the name should not be one which is already being used by another firm. This necessitates extensive investigations.

Marketing Criteria: There is no simple solution to the name selection problem. However, through extensive research and accumulated past experiences, market researchers have developed certain principles which should be followed :

1). A Brand name should reflect directly or indirectly some aspect of the product, viz. benefit, function, etc. For example, the name `BURNOL' immediately connotes that the product has to do something with bums.

2). A Brand should be distinctive, especially if the product requires such distinction, e.g., a name like `CHANCELLOR' for a cigarette conjures up ideas of status, power and opulent life style.

3). A Brand name should be easy to pronounce and remember. Examples are VIMAL, HAMAM, etc.

4). It should be such that it can be legally protected, if necessary.  

A firm invests substantial amount of money on a brand. It should, therefore, ensure that nobody else takes advantage of the brand illegally. Though there is no fool-proof system for_. trademark protection, the steps, as outlined below, can be of substantive help.

1. Use the generic name of the product in association with the trade mark. An example is PEARL PET where PET is the acronym for generic technical product i.e. Polyethylene Terephthalate while PEARL is the brand associated.

2. Designate the brand name as a trade mark by actual notice. If the mark is registered, the proper form of notice is the letter R enclosed in a circle.

3. Display the mark with some form of special graphic treatment. A trade mark is not a noun; therefore it can be capitalized. If it can be printed in some distinctive logotype, so much the better.

4. Do not use the trade mark in the wrong grammatical form. It should not be used as a noun, verb, in the plural, or in the possessive.

5. The trade mark should not be altered by additions or abbreviations?

6. Use the trade mark for a line of products.