Recently, the “brand” has become for many people the philosophical cornerstone of business. Its management, called “branding”, has become fashionable. In the last three years in the United States, more than 2,500 books have been published on this topic. Now that we know without a doubt that in the current hypercompetitive and globalized world, the name of the product, service, company, institution, city, country, and even person, is the most important reference to win over the minds of customers, it is advisable to reflect on whether or not this is the cause or effect.
In Spain there are more than 800,000 registered brands that battle for a market made up of people that, when they have a university degree, use only 10,000 words to communicate, which means that it’s not easy for any company to be the chosen one. The key is knowing the decision-making process when a potential customer feels a need or desire that can be satisfied by many products within their reach.
Today, the “word” that “customers” use to request what satisfies their needs or desires has become the most important asset. Although it’s an intangible asset, it can be much more valuable than production infrastructures and process technologies. Without that word, interested customers wouldn’t be able to order or recommend the product or service offered. Therefore, in this environment we live in, it is absolutely crucial to be the owner of a word that identifies us in a differential and preferential way, in regards to others that offer the same thing or something similar; it allows us to be the first option on the list of potential customers we want to attract.
That is the “brand”. A magic reference that initiates and maintains contact between the demander and the supplier. It is the “hanger” on which our offer “hangs” in the minds of others. A proper name that distinguishes a person, product, service, institution, political party, country…that is, anything that can have its own defined personality, and which is able to generate some type of exchange. In business, it’s the “hanger” on which the customer hangs in his or her mind a product, service, company, or whatever is useful to them. Then they hang it in what we could call a “closet”, the sector in which the activity occurs, with a specific preference regarding others that are in the same “closet” because they offer the same thing or something similar.
But creating a brand is no longer a game based on the combination of letters, syllables, or words and a colorful logo. It takes something more to build and maintain brands in customers’ minds: it is necessary to have a competitive strategy; a careful plan aimed at designing, building, maintaining, and re-modeling the brand in the minds of customers and prescribers. It’s not only a matter of being remembered and attractive, but also being more attractive than all others that offer a similar benefit to the same customers. It is necessary to design a competitive strategy that offers advantages in the customer’s mind, and in which all of the company or institution’s activities are combined. In order to conquer markets, we must capture minds.
Nevertheless, it’s strange to observe how the majority of directors and experts still worry mainly about aspects related to design and advertising when they try to launch or promote a brand. Gone is the era when it was no problem to use a drug’s name for a soft drink (Coca-Cola), or baptize a car with a friend’s daughter’s name (Mercedes). There was very little supply, and demand went unsatisfied. It’s not like that now!
For many, “brand” is linked only to physical products, even more to mass consumption products than to those for commercial use. However, it’s very clear that the “brand” is the reference used to recommend or order something. If we think of the brand’s definition, we see that it’s the word used to recommend or order a physical product or service instead of another, similar one.
In the end, the brand is a promise that must be kept. The biggest problem for those that offer products and services is that they compete with many others that offer the same products and services, which theoretically have the same technical characteristics. It’s not a matter of satisfying only internal or external technical inspectors; it’s a matter of creating a greater “sales merit” than the competitors. But the customers are the ones who give or take away that sales merit, and they’re the ones who decide whether ours is greater or lesser than our competitor’s.
The possibility of everyone making the same products is leading many brands to become “commodities”. Not long ago, an important American research firm, Copernicos Marketing Consulting, investigated two leading brands in 48 different products and services sectors. The goal was to determine whether these brands became more similar or common over time. Out of the 48 sectors analyzed, it was shown that this did indeed happen in 40 of them. The reasons are the consequence of a change in direction: from brand creation to promotion programs, from advertising aimed at informing to advertising aimed at entertaining.
This is where “positioning” must come into play. As Walter Candor said, ”products are made at the factory, but brands are made in the mind”. Positioning is a methodology that tries to understand how the mind works. We define it as “what makes the product or company different in the customers’ minds”. It’s the reason that will make the buyer willing to pay a little bit more for our brand. The trick is in finding the way to express the difference. It’s easy if one is quicker, safer, more attractive, or newer, although sometimes we must turn to other attributes that aren’t as linked to the product or company, but which interest the customer and reinforce our image in their mind. Once we’ve identified the attribute that will differentiate us and make our brand the preferred one, we must concentrate on it. From “R+D+i” to the corporate image, everything must be geared towards creating credentials that reinforce the differentiating concept.
Branding is placing a brand in the customer’s mind, along with its differentiating idea. Sometimes the name itself is enough (Telepizza, Microsoft, for example); although in the majority of cases it is necessary to make distinctions en (Volvo-Safety, Visa-Worldwide leader, Zara-affordable Fashion). Branding and positioning are very linked, if they aren’t the same thing. Therefore, it’s a matter of making them work together.