What is a Brand?

The term brand is widely used but often badly defined by managers and small business owners.

The origin of the term comes from the practice of American ranch owners of marking their cattle and horses with a symbol, usually by branding the mark into the animals skin with a red hot iron.

For many years this was how a brand was defined.  Alexander (1960) defined a brand as:

“A name, term, sign, symbol or design, or a combination of them intended to identify the goods and services of a seller, or a group of sellers, to differentiate them from those of competitors”.

For many small businesses this is how a logo is defined, not a brand.  It is clear that the definition of brand has greatly evolved since 1960. Here is the definition od Schmitt (1999):

“A rich source of sensory, affective and cognitive associations that result in measurable and rewarding brand experiences”

and here is Keller’s (2008) definition:

“Something that has created a certain amount of awareness, reputation and prominence in the market”

A brand therefore is no longer simply a sign to differentiate a company’s products from those of competitors.  It is how your company or products are positioned in the minds of consumers and it is how consumers structure their expectations in relation to your goods and services.

Many market research organisations run brand recognition surveys where they not only ask consumers if they recognise a brand, they ask what the consumer expects from that brand.

For example, when consumers see the Apple Computer’s logo, they respond that they see quality, cutting edge design.  When they see Ferrari’s prancing horse, they see high performance luxury sports cars.  The brand is a short-cut to the whole of a company’s offer.

It must also be recognised that people experience brands without buying or using a product.  The brand is shorthand for the company’s place in their world.

There are three core elements to developing a company name or logo into a brand, position, performance and promise (often abbreviated to the Three Brand P’s; the letter P is an obsession with marketers).  Successful brands are consistent in delivering on their brand promise by meeting or exceeding consumer expectations and in doing so reinforce the position in the market and credibility of their promise.

Central to delivering the three brand P’s are marketing communications, the promotional element of the marketing mix.

When considering communications, do not simply think of advertising.  Many successful brands have developed their three brand P’s using a wide range of communication tools such as, direct marketing, event sponsorship, social media, brand advocates, sales promotions and customer loyalty schemes.

For example Ugg Boots do not see advertising as the main plank of their brand.  Instead, they use fashion and lifestyle blogs, customer reward schemes and ‘brand fans’ some of whom are given work experience opportunities with the firm for advocating the use of the boots with their friends and acquaintances.

Some firms have a single over-arching brand identity; for example BMW; or a Corporate Brand whilst others, such as Volkswagen have multiple brands operating in different market sectors.

Volkswagen is an excellent example of a multi-brand organisation.  It has two core brands, Volkswagen and Audi.  These could be seen as brands which flank one another to protect their central market position.  The group has premium brands such as Bugatti and Lamborghini; A motorcycle brand, Ducatti; and two fighter brands aimed at the cheaper end of the market, Skoda and Seat.

Developing a successful brand takes time and resources.  It is not simply a case of developing a memorable company name or logo.  To develop a successful brand a consistent message of an organisation’s identity which is supported by the actual experience a consumer receives over the long-term.