What Is a Brand?
A brand is a product or a business with a distinct identity among consumers. A brand is created through design, packaging, and advertising elements that distinguish the product from its competitors. The product contributes to the company’s brand equity. A successful brand adds enormous value to a company, giving it a competitive edge over others in the same industry. As such, many companies get trademarks to legally protect their brands.
Key Takeaways
- A successful brand communicates the qualities of a product to the consumer.
- A product’s design, logo, packaging, and advertising message are all coordinated to convey the brand’s message to the consumer.
- Brands are often among a company’s most important and valuable assets.
- Companies can protect their brands by registering trademarks to protect elements of their brands.
Understanding Brands
A brand is a specific feature that identifies a company’s products and services. This feature can be a name, slogan, logo, or design. Some common examples include the Nike swoosh, the Golden Arches, or the Maxwell House slogan “Good to the Last Drop.” When you see or hear these, there’s a very good chance that you’ll identify the company and its products and services.
Companies spend a significant amount of time and money developing and maintaining their brands, which is why there is a great deal of research and marketing involved. Once established, companies seek legal ways to protect their brands, such as trademarks, as they become valuable assets.
Brands convey a message that a product is more effective, easier to use, better tasting, cheaper, classier, hipper, or more environmentally sound than its competitors. This is especially challenging when the product has cheaper alternatives. For instance, Advil is a brand name for ibuprofen. Through effective advertising and packaging, its parent company attempts to convince consumers that Advil’s ibuprofen is a better choice than the cheaper generic versions.
Newer brands face a great deal more urgency in establishing themselves with consumers. To build customer loyalty, a brand needs to convey how it can deliver its product, whether it is making it enjoyable to buy, functional, valuable, and memorable to customers. A core part of building a brand is understanding the customer base to know how to deliver each of these aspects.
Brand Marketing
Successful marketing keeps a company’s brand front and center in people’s minds, at least at the moment of decision-making. That’s why the brand is considered to be one of a company’s most valuable and important assets. It carries tremendous monetary value, affecting both the bottom line and, for public companies, shareholder value.
A company can become inseparable from its brand. Coca-Cola, the soft drink, is synonymous with the company itself, even though the company now owns Schweppes, Dasani, and Hi-C, among hundreds of other brands.
Why Trademark?
Trademarks identify exclusive ownership of a brand and its associated marketing tools. Registering trademarks prevents others from using substantially identical products or services without permission.
History of Brands
The concept of branding may go as far back as 2000 B.C.E. when merchants began considering how they could sell their wares more effectively. Merchants in ancient Babylon developed sales pitches to lure in customers. Craftsmen branded or carved symbols on their merchandise to indicate their origin. Tavern owners hung attractive signs outside.
The word branding for product marketing might have come into use in the 19th century when Western cattle ranchers started using hot irons to mark their livestock with the ranch’s initials or a symbol. Their initial purpose was less marketing than protection from cattle rustlers, but the association stuck.
Branding as mass marketing took off in the 19th century, as sellers of products like flour began thinking about ways to distinguish themselves from their competitors.
How to Create a Brand
When a company seeks to define its public image, it first must determine its brand identity or how it wants to be viewed by the public. The goal is to make the brand memorable and appealing to the target consumer, whether that is hip single people, couples with small children, or affluent retirees.
The company may use a design firm or logo design software to come up with ideas for the visual aspects of a brand, such as its logo. A successful brand accurately portrays the message or feeling that the company wants to get across. This results in brand awareness, or recognition of the brand’s existence and what it offers.
Once a brand has created positive sentiment among its target audience, the firm is said to have built brand equity. Some firms with brand equity and very recognizable product brands include Disney, Coca-Cola, Ferrari, Apple, and Nike.
If done right, a brand results in an increase in sales not only for the specific product being sold but also for other products sold by the same company. A good brand engenders trust, and, after having a good experience with one product, the consumer is more likely to try another product related to the same brand. The phenomenon is known as brand loyalty.
Consumers buy brands that reflect their values. A brand’s social responsibility efforts are important to 64% of consumers, market research company Leger reported in 2022.
Types of Brands
The type of brand used depends on the entity using it. The following are some of the most common forms of brands.
Corporate Brands
Corporate branding is a way for companies to enhance their reputations and distinguish themselves from competitors in their industries. The company’s pricing, mission, and target market all reflect the corporate brand. The goal is to define their personalities, purpose, and values. As noted above, corporations commonly use logos, slogans, imaging, style, and messaging as tools to convey their brands.
Some of the most notable examples of corporate branding include Google, Apple, Nike, Tesla, and Starbucks. Not only have these companies built up product brands, but they’ve also managed to use promotions, slogans, and other tools to boost their names in the market.
Personal Brands
Social media enabled ordinary people to become influencers. Their financial success depends on their ability to create a brand that attracts an audience that certain advertisers want to reach. Personal brands are built through social media posts, sharing images and videos, and conducting meet-and-greets.
The Kardashian family members developed brand value after gaining popularity from their long-running reality show. Collectively and as individuals, they have used their name to successfully launch media and modeling careers, spinoff shows, cosmetics, perfumes, and clothing lines.
For instance, Kylie Jenner sold 51% of her makeup line, Kylie Cosmetics, to Coty for $600 million in 2020. This was largely due to the success of her social media presence, which stood at 397 million Instagram followers as of September 2024.
Product Brands
Introducing a new product or supporting an existing product involves creating and maintaining its brand. Branding a product starts with market research and identifying the right target market.
Companies might choose to create a master brand identity. The Virgin Group, founded by Richard Branson, includes hotels, telecommunications, and airlines, but all sub-brands carry the master brand identity.
Top Global Brands 2023
The top five global brands in 2023 were Apple, Microsoft, Amazon, Google, and Samsung, according to a ranking by Interbrand. Microsoft’s score was up a big 14% year over year.
Benefits of Brands
Creating a brand provides numerous benefits to a corporation or an individual. A company that gets its message across can induce and evoke emotion within its customers, resulting in unique relationships. The companies rely on these customers to help draw in others. This helps companies build trust and credibility that give them a competitive edge against the competition.
It also helps companies introduce new products and services. Consumers stay loyal to brands they know and trust, and with which they already have a relationship. That makes them more likely to spend when new products are released, even if they’re more expensive.
Apple is a classic example. The company built a hugely loyal customer base that is willing to overlook the higher price tag associated with an iMac, MacBook, iPad, or iPhone because of their loyalty to the brand. Its customers don’t hesitate to replace their existing Apple gadgets with new Apple gadgets as the company releases them.
Examples of Brands
Companies use brands to give consumers reasons to buy their products over those of their competitors. We’ve highlighted several examples of major brands above, but here are two more.
Introduced in the 1950s, the Good Hands® Beacon and the slogan “You’re in good hands®” have become synonymous with Allstate. They suggest that the company’s insurance customers can count on it being reliable and competent when they need its help. Its commercials reinforce the message.
Other slogans may be harder to translate but are an intrinsic part of a brand’s identity. For example, the slogan for Kellogg’s Rice Krispies has been “Snap! Crackle! Pop!” has been around since the 1930s. The idea is that the cereal adds a pleasing sound to your breakfast while evoking images of the cheery elves that serve as its spokespeople.
What Does Brand Mean in Marketing?
A brand is a product or service that has a unique and immediately recognizable identity that distinguishes itself from others in its industry. The consumer associates the product name, label, and packaging with particular attributes such as value, quality, or tastefulness.
A cough drop is just a cough drop. But when you go to buy a bag of them, you might choose Ricola, Luden’s, or Beekeeper’s Naturals at least in part based on the brand message that you have received.
What Is Brand Equity?
Brand equity is the commercial value of a product’s reputation to the company that owns it. A company’s price may be determined by adding up the value of its buildings, inventory, and equipment. But its value increases if the company owns one or more brands that have attained a solid reputation with consumers.
Can Great Brands Last Forever?
A select number of brands have lasted for centuries, such as Stella Artois, which dates back to 1366. The Chevy Suburban traces back to 1935, and remains a car brand that is still in circulation today.
At the same time, some of America’s greatest brands have died. They may have failed to keep up with the times, or the businesses that owned them may have mismanaged them.
BobVila.com lists these brands, all of them once household names, that have vanished: Borders, Pan American, F.W. Woolworth, Toys R Us, Blockbuster, Tower Records, Compaq, Oldsmobile, and Howard Johnson’s.
To be fair, Toys R Us made a comeback in 2022 as a store-within-a-store at Macy’s locations.
The Bottom Line
When we hear the word “brand,” most of us think of a logo, slogan, or other identifiable mark. But that’s just one part of the definition. The term “brand” is actually an intangible marketing concept that helps people recognize and identify a product and, at best, reach for it instead of one of its competitors.
A company’s brands are among the most important and valuable assets that it owns. They can make or break a company. That’s why companies do extensive research before launching a new product along with identifying its target market. From there, every aspect of its content, design, and marketing is tailored to the brand identity that they want to create for that market.
