Branding Decision and its Crucial Role in Marketing
Branding is which adds a dimension that differentiates from product to product. Managing a brand is a major task in marketing. Once the product is established in a market over a period of time a company sells the Brand, not the product or service.
The American Marketing Association defined a “brand as a name, term, size, symbol or design or a combination of them intended to identify the goods or service of one seller to another & to differentiate them from those of competitors”.
Role of Brands
1. The brand creates unique identification in the mind of the consumer for a specific product or service.
- A brand allows understanding of a particular manufacturer or distributor for a specific product.
3. The consumer learns about the brand through past experience. The brand develops certain perceptions, and attitudes regarding quality, quantity, taste, variety, etc.
4 The brand also helps in organization inventory at a factory, site, distribution level & at the factory outlet.
5 Over a period of time brands create brand loyalty, among the customer.
- Brands are valuable intangible assets and legal property of a company. A brand can be sold can be bought from others.
Branding Decision
Branding is a critical decision. Due to huge competition companies are creating a brand for each product.
The following are various brand strategies generally used by the firm.
1. Individual brand name
This policy is followed by many companies. Here each product of the company is given an independent brand name
For E.g, Hindustan Unilever has established the brand for each product like in bathing soap line offering Lux, Dove, pears others in hair care, baby product
Advantages
- The major advantage of an individual name is that the company can’t buy its reputation in a single product.
- If one product does not hamper others.
2 Umbrella/ Blanket Family brand
In this type of branding name of the company is used in a diverse product category.
For e.g Tata has followed umbrella branding for diversified products ranging from Tea, Coffee, Automobiles, Steel, etc.
Advantages
- The development cost for the new product is less to create brand recognition.
- If the manufacturer brand is already established it is easy to sell the new product.
3. Separate family names for all products
When companies produce a diversified product they may go for a separate family name.
For eg Aditya Birla group followed this strategy they are as
- Hindalco for an aluminum product.
- Ultratech for cement.
- Grasim for suiting.
- The idea for cellular service.
- Birla for educational institutes.
Advantages
- Because of separate family names, unique brands are named for the specific products
- Failure of one brand may not harm others.
4. Company name combined with an individual product name
This is a sub-branding strategy where the parent brand is used & to this product names are added.
For eg- SONY TV, SONY Camera, SONY mobiles, and SONY DVD.
Advantages
- A brand advantage is used for the next new product as already parent brand has introduced
- Less expenditure to create a brand.
