Straight Talk on Branding

The brand increasingly is becoming the key source of differentiation that guides customer purchase choice.  It is the focal point around which an organization defines how it will uniquely deliver value to the customer for a profit – effectively embodying the “heart and soul” of that organization.  The brand’s promise is delivered through its products, services, and consumer communication – the total customer relationship and experience.  If the brand is well conceived and consistently delivered through all business processes and customer contacts, the organization will grow and prosper.

Not too long ago, marketers at consumer product companies seemed to be the only ones interested in talking about brand management and branding.  But these days, all kinds of organizations are recognizing the importance of branding.  In the past few years, museums, universities, restaurants, churches, and individuals have approached us to help them build their brands.  And now, it seems as though even the average person on the street is talking about brands.

So why has this marketing discipline become so popular?  In an age of increasing product commoditization and choice, the brand is an easy way for people to break through the clutter.  It helps them simplify certain choices in their lives.  And brands are increasingly fulfilling peoples’ needs for affiliation and identification – needs that traditional institutions are struggling to deliver as well as they used to.
 
Senior management interest in brands has soared for a variety of reasons:

•Studies have shown that more and more categories are moving toward commoditization as companies (a) use increasingly sophisticated customer research to understand and address customer needs and (b) are able to quickly determine and emulate the best practices of their competitors.  A strong brand can help combat category commoditization and the resulting downward pressures on price.

•to shift some leverage back to the manufacturer from the retailer (this is a relationship the manufacturer can own with the consumer.)

•brands provide a flexible platform for growth (beyond current categories)

•relatively recent deregulation in several industries (notably, the utilities) has resulted in a need for
differentiation

•increased competition

•the emergence of the Internet and now Web 2.0

Branding also becomes a critical issue for businesses that are spun off from the parent company and as more and more companies merge or acquire one another.  The brand identity of the new combined enterprise becomes a critical decision. 

There's more, but my plane is about to land. Please stay tuned.