Branding (Part - 1) - Product, Principles of Marketing | Principles of Marketing - B Com PDF Download

Branding
Product-mix is a part of marketing-mix. While understanding the concept of marketing-mix, we have already studied and understood as if what product-mix means and what are the variables of product-mix namely, product-line and product range, product design, product package, product quality, product labelling, product branding, after-sales services and grantees and so on.

Brands and Branding:
Almost every concern wants to name its products. These names given are brand names. Branding plays more role than a mere name. It is because; brands name is quite different from ordinary name.

What Brands and Branding Mean?
A brand is a symbol, a mark, a name that acts as a means of communication which brings about an identity of a given product. Brand is product image, brand is quality of product; brand is value; it is personality.

It is nothing but naming the product; and naming product is like naming a child. Parents know that the success and happiness of their children is primarily dependent on the development of their character, intelligence and capacity and not on their name. But they, nonetheless, take care in naming their children for the identification.

Products are children of manufacturers, unlike human children; products are not brought into world by accident. There is conscious decision to give birth. Once a product takes birth, it needs an identity and that is brand; and recognizing it as branding.

‘Product differentiation’ is the note-worthy feature of manufactured goods; one such device of product differentiation is branding the products. A brand is a symbol, a mark, a name, that acts as a means of communication which brings about an identity of the product. Brand is the quality of a product. Brand is the value.

The aims of branding are to give personality to the product, to make its existence known to the public; to create preference for the branded product; to control the price of commodities; to impress about product performance. For instance, ‘Tore Nylex’ Sarees, ‘Terene’ mark on Synthetic fibre cloth, Baby of Murphy, Dog of His Master’s Voice, 501 Bar Soap, Club of Arvind Mills, are the instances of brands or trade-marks. There is a slight difference between a ‘brand’ and a ‘trade mark’. ‘Trade mark’ is a legalized or registered brand. Such legalization avoids imitation by rivals. For instance. Parley “Gluco” is a trade mark, which cannot be imitated under Names and Emblems Act in India.

While branding, the dealer or the producer must select such a mark, or name or symbol that is easy to remember, appealing to eyes, ears, and brain. It must be short, sweet and attractive. For instance, the Honey Dew Cigarettes are having a trade mark of ‘black elephant’ on yellow packet which is popular as ‘Pivala Hatt’ even amongst millions of illiterate people of India. Same is the case with ‘Murphy Baby’ or ‘Yellow Thread’ of ‘Sinner Beedies’.

Role of Branding:
None finds a pragmatic concern aloof from this branding. Brand names came to create identity to distinguish one product from another. Identifying is essential to competition because, without means of identification there is no way of making a choice except by happen stance. Brand names not only facilitate choice but they spur to a responsible action.

Following points pin down its precise role:

1. Brand is a Massive Asset:
Brand is considered as a major intangible asset because all the physical assets such as plant, equipment, inventory, building, stocks and bounds can be duplicated or copied very easily, however, it is almost impossible to duplicate brand name.

It has been proved, as there are many case where the firms have gone to hell still brand remained high in the sky.

2. Brand is a Promotional Tool:
Sales promotion is founded on the idea of product identification or product differentiation. This difference is done by a brand. Major weapon of product popularization is advertising. And it is futile to advertise a product without a brand name.
Even the work of salesman would be a failure in absence of a brand name. Thus, branding plays a highly creative role in determining the success or failure of a product.

3. Brand is a Weapon to Protect Market:
Once a consumer has tried and liked a product the brand enables him to identify so well that he is tempted to levy it again. For instance, a house wife using VIM cleaning powder may not use other powders like BIZ, ODOPIC etc., as she is soaked in with VIM. That is, the product earns goodwill. In other words, absence of brand name will make repeated purchases stand still.

4. Brand is Antidote for Middlemen’s’ Survival:
If a product wins consumer reputation, the manufacturers gain control over product distribution. The class of middlemen always tends to go in for a successful brand. That is, without brand identification, these middlemen find it difficult as to what to buy and sell.

In fact, brand names can be so strong and penetrating that the very survival of middlemen rests on their efforts and ability to sell a powerful branded product.

5. Brand is a Means of Identification for Customers:
Brand is the easiest way of identifying product or service that a customer likes. For him, brand is value, quality, personality, prestige and image.
A branded product is a distinct product in his eyes. Thus Philips bulbs are regardless of where they are bought.
Again, branded products tend to have improvement in quality over the years. It is naturally out of competition. Thus, Aspro tablet of 1960 was quite different from micro-fined of 1970s.

A Good Brand Name:
Certain factors make a brand name good one. They are:

1. It must be Easy to Pronounce and Remember:
For instance, “HOECHST” is difficult to pronounce. On the other hand, “Murphy Baby” and ‘Click’ are fine example.

2. It should be Short and Sweet:
The name must be short yet sweet, appealing to eyes, ears and brain. Mukund and Mukund, Panama, D.C.M., Bombay Dyeing, Bata, Tata, etc., are of such kind.

3. It Should Point out Producer:
The name or symbol should be given connotation of the product, producer, etc. The best examples are NELCO, MICO, LT. AMUL, B.T. INDAL etc.

4. It should be legally protectable:
The brand name must lend them for legal protection. A brand name, legally recognised, is known as trade mark. Normally, it depends on the will and discretion of a producer, middlemen than on brand name.

5. It Should Be Original:
The brand name selected must not be general but specific. It must be such that it is not easily copied by others. Hardly does one finds the use of brand “Philips” by imitators. On the other hand, “Gluco” and “Glucose” biscuits are different.

There is difference in “Upkar” and “Upchar” Supari. But for a common man, it is more difficult to identify and differentiate.

6. It Should Reflect Product Dimensions:
A good brand name is one which reflects directly or indirectly some dimensions say product benefit, function, and results and so on. For instance EZEE of Godrej Company is really easy to use for better results; another brand GOOD-NIGHT of a mosquito repellant pad implies the user says ‘good-night’ to mosquitoes as he is going have good and sound sleep at least eight-hours. PUMA brand shoes are the symbol of speed as panther is shown.

Merits of Branding:
The merits of branding can be discussed from the angles of manufacturers, middlemen and consumers:

A. Merits to the Manufacturers:
The makers of the products stand to gain because brand has a definite role to play to assist them in effective marketing goods.

These are:

1. Products Get Individuality:
For any product, we have many competitors, though yours may be the first company to conceive and give birth to new product. Product, like a baby has to have a name which symbolizes the efforts and resources put into bring to light that product. Your product, if branded will has its own personality standing out rest of all the competitors.

Take a simple case of tooth paste ; the Colgate in its variety, has many other competitive brands like Pepsodent, Forhans, Neem, Dentoback, Anchor, Signal, Babool, Miswak, Glister, Himalaya Dental cream, Promise, and so on.

For a customer “Colgate is Colgate” or “Promise is Promise” where the customers are divided and the producers have their own market share depending on the value given by the user to a particular brand as he or she perceives it.

2. Control of Product Prices:
Control of retail price is a significant factor because each consumer is quality and cost conscious. Each pack or a wrapper contains in the message the MRP-Maximum Retail Price inclusive or exclusive taxes depending on the situation.

Such facility makes the producers to have sound sleep because the greedy middlemen-may is wholesalers or retailers would have charged any price.

Even an uneducated consumer is well informed through ads especially TV, Cinema and other audio-visuals or audio sets. He or she insists on buying a product at printed price on the pack. Thus, the producers have the solace that products are reaching the final user at the prices printed that are most economical to the consumers.

3. Increases Bargaining Power:
Good brand and branding gives greater bargaining power to the manufacturer with the dealers. This is because; there is already a ‘pull’ in favour of the product. Hence there is no need for a great ‘push’ by retailers.

As, it is easier to sell or market branded products, wholesalers and retailers prefer to stock and deal in branded products than non-branded. This gives an edge over dealers to the manufacturers which empowers or strengthens the hands of manufacturers to dictate the terms in their favour.

4. It Reduces the Advertising Costs:
Advertising plays an important role in communicating the ad message of the manufacturers to the consumers directly and middlemen indirectly. A product which is known to the consumer hardly needs extra advertising expenses each time.

At the most he has to make the customers to remember by reminder advertising because of large-scale brand proliferation and competitive advertising and constant storming of consumer brains. The over expenditure drops down in case of branded products. This is an advantage of consumer loyalty that is created by brands-the effective brands.

5. Ever Increasing Demand:
Powerful brands have the capacity to create, maintain and extend the demand for a product. The strong bonds have longest life. A recent study conducted by A and M Magazine report, the top ten brands of the year 1999 were Colgate, Amul, Dettol, Britannia, Life boy, Ariel, Horlicks, Lux, Zee TV and Doordarshan.

This power brand is all India which differs from zone to zone-south, north east and west. Once a brand is built or in sight and mind it leads to word of mouth advertising; that it rolls on its own leading increased demand.

6. Introduction of New Product is Made Easy Task:
Launching of product-particularly new one is the toughest job. However, the consumers who are loyal to the brands or products of a particular company say, HLL, Godrej, Colgate Palmolive, virtually, they are addicted to that brand. This is particularly true in case of smokers, soaps, tooth paste, hair-creams and jells, scents and deodorants.

This is equally applicable to consumer durables. In each case, a particular brand ranks in case of a product. In case such a company is launching a new product, it will be easily accepted because of past trust in the company. Thus, HLL from ‘Liril’ trying for ‘Fa’ soaps and deodorants for men and women. Thus, the job is made comparatively easier.

However, in all cases, it is not true. For instance, Philip’s company known for sound gadgets failed successfully by introducing dry- cells and shaving blades.

7. It is A Powerful Weapon of Product Diffentiation:
Day by day, the markets are getting more competitive and market driven and consumer driven. In such case the companies that succeed in differentiating the product can carve niches for themselves through this weapon.

One is aware of the onslaught of Mc Donald’s and Domino’s Pizza impact. Indian cooperative namely Amul came out with Pizza huts as distinct product for using cheese that is produced.

It is a grand success and is now felt that ‘Pizza Huts’ are preferred to Mc Donalds and Domino’s. This product differentiation combats keen competition by positioning and repositioning the product.

One is aware of the war going on between Coca-Cola and Pepsi Cola. The Coca-Cola working with “Kuch bhi ho jai Coca Cola Enjoy”. Pepsi with “Dil Mange More”. Now come out with Pepsi “Le Chel Le Chel” on the contrary Coca- Cola changed its slagan “Thunda Matlab-Coca Cola”.

B. Merits to Wholesalers and Retailers:
The middlemen who connect the manufacturers and consumers stand to benefit the following because of branding:

1. Quicker Sales:
The middlemen wholesalers and retailers need the shorter time for sales to take place. In case of unbranded goods and weak brands, they are slow moving. It is because, sales stem from final consumers.

That is consumers should approach first the retailers and then retailers to wholesalers and they procure from the producers or out of stock the delivery takes place. The question of prospects being converted into customers is a big process which is done by perfect promotion mix plus the power of the brand.

2. Advertising and Display of Products is Rendered Easier:
A product which is known by its name or symbol or combination which we call brand has the magic which needs no such advertising. Display advertising both window and counter will be a regular feature which as the merits of POP point of purchase displays. They have a fixed schedule making movement from one rejoins another by display-department.

3. Increases Market Share and Control over Market:
Each supply chain in target market helps to increase the share in total market sales of that market and can do better than competitors. That is by having increased market share; it will have market leadership creating challengers by sitting in driver’s seat. This means the company has greater control through middlemen. It is natural that middlemen will take pride in doing so.

4. Introduction of New Products is Rendered Easier:
The retailers are the first line army who are in close touch with customers. Retailers are the purchase agents or officers for customers because it is the customers who seek advice from the retailers as to what to buy and what not to buy.

Retailers have no hesitation to recommend new products. Again, they have training and hints from wholesalers. Thus introduction of new products is not a botheration.

5. Branded Products Have More Stabilized Prices:
This has very good impact in combating competition. When the branded products of various companies are there in the market available for they go by quality and not by price. That is, the competitors do not have much ice-way for price competition.

Only way to compete is by quality. When your product is superior at that consumer realize that it is so, you have won the battle. This reduces competition as price comparisons are not made, if price differentials are marginal.

6. Economical Way of Doing Business:
When the wholesalers and retailers decide to trade on the brands of manufacturers, they need not create any brand. Brand creation is not a joke that involves investment in terms of time, talent and treasure. With all that they may not succeed. That is why most of the wholesalers-especially try to deal on brands of manufacturers.

C. Merits to Consumers:
The classes of consumers for whom the products are produced as per their specifications or near specifications stand gain by branding or branded products. These are:

1. Brand Stands for Quality:
When consumers are buying the products, they are selective as certain brands as it symbolizes the quality standards. Unbranded products, to have quality but no assurance as greedy producers may say something and pass on spurious stuff to the customers.

When the days have come that duplicating of even life-saving medicines right from stuff to packaging so much so that the consumer fails to say which is “original” and which is “duplicate” though the measures are taker as “bar­codes” and ‘holograms”. Generally brand stands for quality and quality assurance where the satisfaction of consumers lies.

2. Consumer Protection against Cheating:
The hard earned money of consumer does not go waste because; the manufacturers print on each pack or container the MRP Maximum Retail Price inclusive or exclusive of local taxes.

Therefore, the retailers can not charge more than what is printed. Even if they do so, they are losing customers as the products are available at right prices in other outlets.

Again, the expiry date, date of manufacturing, batch number and the like are given which help in setting disputes as and when arise, if any.

3. Branded Products Reflect their Life Styles:
Branded products speak of the personality of a product and therefore the personality and the life style of consumers. One can easily say, by the use of certain brands of toiletries, dress-materials, ready garments, shoes, watches, white goods, to what class the consumer belongs; it reflects their quality of life.

When a person arranges wedding reception party in 5 star hotels, one can easily guess what the purchasing power of the party involved is. Each person, each family wants to have their own image depending on their paying or spending capacity.

4. Steady and Regular Supply of Products:
Consumers are not only worried about the supply of quality goods at reasonable rates but equally interested in adequate and regular supply of products. Each individual, each family has a family has not only budget but the schedule of supply of goods in definite quantities.

This supply chain should not be broken. Normally, it does not happen in case of branded products because there is no scope for bungling.

5. Pre-valance of Stable Prices:
Between branded and unbranded products, branded products have prices printed as to what the consumer is to pay as MRP maximum retail price. In case of unbranded products manufacturers normally do not print MRP or maximum retail price.

The act of branding the product is in favour of consumers as regular prices are printed that stay regular over a particular period and it does not give chance to retailers to manipulate, as they can do in case unbranded products.

The facility of comparatively stabilized prices accrues to those who use branded products. Whether it is a premium brand or non-premium brand prices are more or less stabilized over a period of time.

Brand Success:
Brand success is the ability to retain a reasonable market share despite market redefinitions. 

The phrase market redefinition covers three categories of redefinitions. These are segment redefinition product redefinition and category redefinition. It pays to understand these components to have full understanding of market redefinition.

Segment Redefinition:

What Is It?
Segment redefinition means shifting of people from high price segment to low price segment and vice versa. In the past detergent market was seen as different from detergent cake market by marketers in India.

Powder was priced high and the cake low. The entry of Nirma changed this. Nirma is a detergent powder but was priced at almost one third of the leading competitors which changed the whole complex of the market. Nirma became Rs. 5 billion brand and in the process redefined the market.

The consumers from high price segment migrated to low price segment. After Nirma, several low priced detergent powders were launched such as ‘Wheel’ Ariel Super- saver. This is a case of “Segment Redefinition”. The opposite was true in case of Titan Watches which were launched after decades of HMT Watches.

Titan watches were high priced as compared HMT watches. Large number of consumers moved from HMT segment to Titan-Segment. The reason was repositioning where Titan did not remain as only a chronometer but a product reflecting a better quality of life or a life style product.