Branding Decisions

Branding Decisions

Branding is an important strategy to differentiate the product from its competitors. Its a name ,logo ,trade mark, even patent number or package design, intended to identify the firm’s products or services from others. It represents to the customer the source of the product which leads him to associate with the brand. In taking brand decisions, the firm has to consider the target market, cultural influences on the market and the role the brand will play in its business strategy. Foe example, a brand name which is culturally alien will find difficulty in getting accepted in the market, like in the case of Kiss and Tell brand of cosmetics that failed in the Indian market. Besides, a firm has to ensure that a brand name is not banned because it represents either a national leader or the country.

The brand decisions a firm has to take are:

1.Manufacturer’s name ,i.e whether to have its own name on all products ,or
2.Marketing organization/Distributions brand name ;or
3.Adopt a combination of the two.

Manufacturer’s Brand Policy or National Brand Policy

This policy is based on the assumption that the manufacturer had built a reputation in the market, has strength in distribution and the firm had adequate financial resources to establish a new product in the market. Customer confidence in the firm is the prime factor in the manufacturer deciding to brand the production his own name. When the firm markets this product in its own name ,nationally, this may also be called the national brand policy Common examples are all leading national brands of all well known firms in India.

The options available to a firm here are :

1.Family brand name ;or
2.Independent brand name.

The strategy of family brand name works when its name brings positive associations in the mind of the consumer. To the customer ,it represents quality, reliability and assurance of meeting specific standards.

The strategy of an independent brand name is therefore advisable. This can also help to penetrate different markets segments which may buy the firm’s product for different reasons. This strategy can also ensure that the firm doesn’t lose its original position. For example ,if Hindustan Lever would have introduce different detergent powders under the name of Surf for different market segments and differentiated them only on the basis of price it could have run the risk of losing even the original positioning of an economical detergent powder to an economy conscious middle-class housewife

Even in the same market segment ,a firm may offer different brands of the same product but with different benefits and appeal. Consider for example ,Hindustan Levers’ Liril and Lux brand of toilet soaps in the premium market .Lux has traditionally been positioned as a beauty soap while Liril offers benefits of lemon. Thus, an independent brand offers extensive benefits without endangering the corporate image.

Mixed Brand Policy

The two options is for the firm to enter into a strategic alliance with a well-known marketing firm and let it market the product under its brand name in a defined geographical area .The manufacturer also continues to market the product under his own name nationally. This is done to fight regional competition .Consider Kelvinator’s strategy of marketing refrigerators in its own name and also that of others like Blue Star, Leonard and Spencer ,Whirlpool also lets Mirc Electronics market its washing machines under the name ONIDA.

This strategy allows the firm to take benefits of both the options spelt out earlier.
Brand decisions are central to new product launches and have to be carefully taken. These represent investments in future and also the degree of control the manufacturing firm wants over its marketing operation.

Positioning

Another decision in commercialization of a new product is how to differentiate it in the midst of an already over-communicated society of ours, where an average consumer screens out most of the messages .The strategy to differentiate the brand or product is to place it in an appropriate cell of the human mind so that whenever the customer recalls the product, the firm’s brand id the first to be recalled. This strategy is called Positioning .Positioning is the act of communicating company’s offer so that it occupies a distinct and valued place in the customers mind.

The concept of positioning was first advocated by Al Ries and Jack Trout ,two advertising executives in their articles titled The Positioning Era: A View Ten Years Later in Advertising Age in 1972 and later in their book Positioning :The Battle For Your Mind in 1982. According to them :

Positioning is not what you do to a product. But what you do to the mind of the prospect .That is, you position the product in the mind of the prospect.

Ries and Trout believe that marketing is like a war which is fought in the mind of consumers. They advocate that the marketer should perceive each consumer to mentally have a product ladder. The customer often knows brands in the form of this ladder. There is a brand on the top of the ladder (brand leader) and there are others that occupy the second and the third step in this ladder .Sometimes the top slot may be vacant and at other times there may be two or three brands vying for this pr4estigious slot in the customer’s mind .The rush for the top slot is understandable as people remember number one.