How to create a brand?
There are four effective steps in branding strategy for creating a brand:
Choose your brand and logo
Establish the brand in the minds of customers
Develop the brand
What is brand equity?
How to create a brand is no different than how to found your business. It takes time. Little by little, you can build Brand Equity. Brand equity is the differential effect when consumers react more favorably to a brand than to a generic or unbranded version of the same product. Whenever we think about buying a smartphone, the first name that catches our attention is: the iPhone. Do you ask why? It is due to the comfort and authenticity that the iPhone offers to its users.
Apple through its years of research and experience has created a state of mind in our mind of maximum luxury and comfort in the use of its products. There may be some more similar products from others in line with the Apple iPhone and it may be superior to that, but the identity of the iPhone gives it the edge over others, no matter the price. This advantage is brand equity.
4 steps of a brand development strategy
1. Choose the brand name and select the logo:
While building a branding strategy, the name plays a vital role. A good name and style can add positive aspects to the success of a product. It is the most difficult task to begin with. Simplicity is the first step. The name should be easy to pronounce, recognize and remember. Also, it should suggest something about the benefits and qualities of the product.
Names like Google, Nike, Facebook, Apple, KFC, etc. They are among the most established brands around the world. An interesting fact about those names is that they can be easily translated into different languages around the world. Therefore, the meaning of a particular word should not be something that indicates bad, incorrect or negative.
Again, the name should be able to expand to cover various product lines. For example, Amazon.com started its business selling books and has now spread to multiple product categories.
Once chosen, the brand must also be protected. In many cases, the brand names got mixed up with the product category and people cannot differentiate the brand identity from the product category.
For example, Xerox is a company that makes copiers, but making a photocopy is often referred to as making a photocopier. ‘Xerox’ must be pronounced as a noun and not as a verb. Many people find it difficult to distinguish between product and service, which ultimately hampers company branding.
2. Establish the brand in the minds of customers:
An interesting saying from a marketer: Products are created in the factory, but brands are created in the mind. This can be done in multiple ways: At the basic level, it starts with presenting the product and its distinctive features to target customers.
Let’s take the example of Amazon’s Kindle e-book reader. Amazon addresses its customers, saying that it is an e-book reader that has the distinctive feature of reading books in a virtual format. At this stage, they are simply introduced with the product and have a very low impact level.
The most effective way to position a brand is to associate your name with desirable benefits. So Kindle is beyond an e-book reader – it’s lightweight, a dictionary on the go, it stores thousands of books that are easy to search, glare-free, and distraction-free.
The strongest brands go beyond establishing characteristics and benefits in the minds of customers and are positioned on solid values and beliefs, rooted in a deep emotional bond. Like reading books on Kindle is an absolute pleasure and is presented as the new best friend of book lovers. When placing a brand in the human mind, the marketer must establish a mission for the brand and a vision of what the brand should be and do.
3. Brand sponsorship:
Brand sponsorship can be of three types:
Private brand sponsorship
Licensed brand sponsorship
Private brand sponsorship:
Many advertisements and social marketing strategies work behind the emerging big brands and are called national brands. But for smaller businesses, it may not always be possible to back brands out of pocket. In those scenarios, brand sponsorship is very important. Unlike national or manufacturing brands, there are store brands. In recent decades, store brands are gaining more on the market. This is why?
Large malls like Big Bazaar, Walmart resell products at significant discount rates, especially generic or no-name brands. They endorse the products by citing their advantages or putting them next to the comparison with the best brands. The association of large resellers with lesser-known products helps to raise the brand equity of the product that was once called “no-name.”
Private label sponsorship is also followed in online shopping. As we can see, small or lesser known mobile device makers are recently partnering with Amazon to sell their phones. In fact, this strategy is working very well, as ‘no-name’ brands are gaining support from big box stores, whether online or offline.
Licensed Brand Sponsorship:
In sponsoring this brand, some companies buy the names and symbols of other manufacturers or creators for a fee and endorse their products with that brand. This is a common thing in the fashion industry such as Calvin Klein, Tommy Hilfiger, Gucci, Armani, etc., where companies use the names and initials of a well-known fashion innovator. This kind of branding turns out to be an added boost, but with a pinch in the pocket.
Under such a brand sponsorship strategy, established brands from different companies are used on the same product. Because each brand dominates in a different category, the combined brands create broader consumer appeal and greater brand equity.
For example, Bajaj Allianz Life Insurance, where Bajaj is a dominant player in the automotive sector and Allianz is one of the leading financial services companies in Germany. Now that Bajaj wants an entry into the insurance sector and Allianz wants an entry into the Indian market, together they made a ‘Bajaj-Allianz’ brand to reap the rewards of the Indian insurance market.
Co-branding also has some limitations. These relationships often involve complex legal contracts and licenses. Co-branded partners must carefully coordinate their advertising, sales promotion, and other marketing efforts. The responsibility rests with both partners to carry the shared brand with confidence and dignity.
4. Brand development:
To increase brand equity, it is very important to prepare a brand development strategy that does not correspond to changing business scenarios. There is no hard and fast rule to dictate.
The brand name of a product can be extended to an existing product line to accredit new shapes, colors, sizes, ingredients or flavors of an existing product. However, line extensions do carry some risks. A brand name that is too widespread can cause consumer confusion or lose some of its specific meaning.
It occurs when a current brand is extended to a new or modified product in a new category. For example, Nestlé’s popular Maagi noodle brand has expanded into its tomato sauce, pasta, soup, etc. A brand extension gives a new product instant recognition and faster acceptance. But one should be careful when extending the brand, as it can confuse the image of the main brand.
Multibrand offers a way to establish different characteristics that attract different customer segments, lock in more space on resellers’ shelves, and capture more market share.
For example, a reputable company sells multiple varieties of soft drinks under different brands. These brands are fighting each other to dominate the market and, as a result, individually may have a smaller share of a cake, but as a whole, the Company is dominating the soft drink market. The biggest drawback here is that individual brands get only a small market share and may not be very profitable.
Brands are not created in a day or two; you must have the patience to cultivate it. The points mentioned above suggest some best practices for building a brand, but the real test begins in the field. The branding strategy differs from place to place, even urban branding and rural branding are very different in their practical applications. Remember that behind a successful branding strategy, there are many efforts, a vividly clear vision, and most of all, uncompromising product or service quality.