The Fundamentals of Branding:

It’s interesting to see fundamentals of branding still be applicable since 2003. 

What Is Branding?

Branding is the foundation of marketing and is inseparable from business strategy. It is therefore more than putting a label on a fancy product. Nowadays, a corporation, law firm, country, university, museum, hospital, celebrity, and even you in your career can be considered as a brand.

As such, a brand is a combination of attributes, communicated through a name, or a symbol, that influences a thought-process in the mind of an audience and creates value.

As branding is deeply anchored in psycho-sociology, it takes into account both tangible and intangibleattributes, e.g., functional and emotional benefits. Therefore, those attributes compose the beliefs that the brand’s audience recalls when they think about the brand in its context.

The value of a brand resides, for the audience, in the promise that the product or service will deliver. Clearly, a brand can recall memories of a bad experience. The value for the audience then would be to avoid purchasing that brand.

From the perspective of the brand’s owner, the value of the brand often lies in the security of higher future earnings, but may also be assessed in terms of votes for a politician, career for an executive, foreign direct investments (FDI) for a country, etc.

In conclusion, branding is the blend of art and science that manages associations between a brand and memories in the mind of the brand’s audience. It involves focusing resources on selected tangible and intangible attributes to differentiate the brand in an attractive, meaningful and compelling way for the targeted audience.

Brand management then becomes the organizational framework that systematically manages those customer-centric processes. It aims at gathering intelligence, allocating resources, and consistently delivering the brand promise over time at each contact-point with the customer.

 
Coca-Cola, for example, has become a cliché of brand management. Before branding or even management emerged as disciplines, the Atlanta-based company was already spending over US$ 11,000 on a mass advertising campaign as early as 1892. Its trademark was officially filed in the US that year and has consistently been displayed with the same script to this day. Over time, it also associated its brand with a bright red color, the hour-glass shaped bottle (1915) and the ribbon logo (1970). Together these aspects contribute to differentiating Coke from rivals such as Pepsi-Cola, which has applied a competitive pressure since 1898.

Is Branding Different from Naming?

Naming is a subset of branding. Any combination of sounds, or phonemes, can compose a name, and perhaps be unique enough as to identify a product or service without ambiguity. But that is not enough to make it a brand.

For internal purposes, engineers or designers often use code names to identify their projects, such as PN96. To become a brand, however, a name has to be able to fit in its audience’s memory in a way that will make the brand’s attributes recalled. Thus, “PN96” turns out to be the best selling vehicle in the US, the F150 truck, “Built Ford Tough.”

Nevertheless, naming is a critical step of branding, and it would be a missed opportunity to leave it to Tarzan or the CEO’s spouse. Deprived of access to the Brandchannel, Tarzan sought common nouns from his limited vocabulary to name his adopted son and quickly ended up with “Boy.” Little he knew! If new parents cringe at the idea of getting the new name past their mothers-in-law, brand managers have to deal with a long battery of naming tests (and eventually the CEO’s mother-in-law). On the bright side, a well-chosen name can be so powerful as to become a one-word commercial. It is especially critical for small businesses, which often lack of the necessary marketing budgets to promote their brand effectively.

The story of a small business of California marvelously illustrates this situation. Until 1991, the airport of San Diego, California, was served by Supershuttle, the franchise of a largely undifferentiated shuttle operator. Its brand experience was no more than four wheels under a van, lacking any emotional appeal. As a result, even former customers arriving at the airport were about as likely to call a competitor, such as Sureride. That was good for the competition, but not for Supershuttle.

Loaded with debt, the operator filed for Chapter 11 bankruptcy protection, restructured its balance sheet, left the franchise network and changed its name. Since its phone number was 1-800-9-Shuttle and San Diegans live in a corner of paradise, the name Cloud-9-Shuttle came to mind. (To be on “cloud nine” means to be in paradise.) 

 At first, the new name seemed crazy and unbusinesslike, but it was clearly differentiated and San Diegans came to love it. Bearing its new identity, Cloud-9-Shuttle flew out of the rubble to quickly grab a 75 percent share of the local shuttle market.

Does Branding Apply to Us?

The concept of branding applies to any individual, organization, product, or service, as long as there is a transaction between human beings. Indeed, branding relies on fundamental principles of psycho-sociology – essentially the way our memory processes, stores, and recalls information. Not to actively manage one’s brand name is therefore the equivalent of putting one’s head in the sand and wishing for the best.

Many law firms, for example, assume that branding would negatively impact their reputation. However, branding should not be confused with television commercials. Whereas relationships and quality work are still fundamental to the success of a law firm, brand management can help a law firm in many ways, including (1) making clients more loyal to the firm as a whole than to specific professionals within the firm; (2) communicating a focused message to attract new clients, who increasingly shop around for razor-sharp legal expertise; (3) retain talent and attract bright new graduates, for whom the reputation of a firm is often an important non-cash factor.

Along the same lines, branding can usefully help David defeat Goliath when an asymmetry of resources makes the battle seemingly one-sided.

In 1981, the mighty IBM Corp launched the IBM Personal Computer — the smallest IBM computer to date — at the aggressive introductory price of $1,565. The IBM PC became an immediate success and an industry standard, epitomized as Time magazine’s 1982 “Man” of the Year.

Apple Computer needed something radically novel to counter the new IBM PC. Unfortunately, Apple’s own new products, the Apple III and Lisa, missed an opportunity to make much of an impact and were received with a cold shoulder. Working with Frog Design, an industrial design firm, Apple decided to wrap its innovative technology into an equally innovative product design that would contrast with the boxy IBM PC. This collaboration gave birth to the original Macintosh, which is now part of the permanent collection at the Museum of Modern Art (MoMA) in New York.

There are branding steps that can have a considerable impact on revenues without the need for big budgets, such as the brand positioning strategy, the naming of the product, the packaging design, the delivery process of a service, the consistency of the brand experience at each contact-point with the customer, to mention a few.

How Long Does It Take to Build a Brand?

It takes as much time to build a brand as it takes a person to build a reputation. The difficulty is not as much to perfect a strategy as to be focused, differentiated, and consistent everywhere, every time. Will it take one, five, ten or over twenty years? That essentially depends on the memory and openness of the brand’s audience.

For instance, it took about 15 years for Nike to build one of the strongest global brands, thanks to (1) a focused brand positioning, (2) consistent 360-degree delivery, and (3) its association with All-Star basketball player Michael Jordan. BRS (Blue Ribbon Sports) first used the Nike brand in 1971, and introduced the Air Jordan in 1985. By then, all the pieces fit well together, from the brand strategy to the product’s air technology to distribution in over 40 countries. Revenues soared from about $1 billion (1985) to over $9 billion (1997).

Nike truly distinguished itself in its ability to deliver a consistent message across 360 degrees. Indeed, over a long period of time, Nike consistently delivered its brand message at each contact-point with its customers, from product, to advertising, to distribution, to merchandising, to website. For example, fans of Michael Jordan’s Chicago Bulls could enjoy a remarkable consistency between Niketown and Nike’s TV commercials, as the gothic atmosphere depicted on the small screen could also be experienced three-dimensionally by the visitor at the Niketown store on North Michigan Avenue in the Bulls’ hometown.

How Can Non-marketers Contribute to Branding?

Marketing and its sister branding are too important to be left to marketers alone. In a corporation, it is everybody’s business to be cost-conscious as well as customer-driven. In fact, it is the purpose ofbrand management to transform a company into a customer-centric organization to the point where the traditional walls that separate functions become permeable.

In a customer-centric organization, management can thus be defined as a discipline of action that integrates holistically all the corporate functions to deliver systematically value to customers beyond their expectation.

Although the development of a brand strategy typically involves a limited number of executives and their aides, the successful implementation of a strategy is everybody’s responsibility. Indeed, a major source of failure in the attempt to build a great brand is the lack of consistency among all the contact-points with the customer. In such a case, the brand message makes a promise on which the organization does not fully deliver. A sure way to ensure that the customer will consistently enjoy the brand experience is to implement processes throughout the organization.

In the demanding hotel industry, for instance, the Ritz-Carlton has demonstrated that — with customer-driven targets, metrics, and processes — the same high quality of service can be delivered all over the world, day after day.

Although the word process may connote something cumbersome, most processes can be (and should be) simple to the point of becoming second nature. As such, processes become like the syntax that children learn to align words into meaningful sentences. They allow entire organizations to communicate with their customers more effectively and convincingly.

Readers may also enjoy What Makes a Brand Great by the same author, and brandchannel’sGlossary for helpful definitions of branding terms.     

[3-Nov-2003]

Vincent Grimaldi de Puget is a leading brand strategist. He is a partner at GRIFIN PARTNERS, focusing on capital investing and business restructuring, and a visiting professor at US and European business schools.

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