Branding for New Services and New Businesses
For branding, firms need to take the same process when they enter into the market with a new brand or when with an old company decide to create a new brand. Therefore, for a precise analysis of the process, the methodology and basic principles of the branding should be known. The points mentioned are part of the remarks by Babak Kazemi, Director of the EBH Company from the dnaunion group that were made at the workshop of the third conference and national excellence award of marketing and branding communications.
Speaking at the workshop themed “Branding for New Services and New Businesses”, said: “We should begin with the key definitions of brand first. The more the brands can create contact points that are in consistency with their main strategy, the more time they will have to remain on the minds of their audiences. For example, the audience does not need to see an image of Benz cars in order to remember the Benz brand. As soon as the audience sees one of the contact points such as the logo, they would immediately recall the brand. Every strong brand in the world has gone through such a process. It is possible that in one part of the world, the points of contact of a brand be remembered by the audience as soon as it is seen, but in the other part this will not happen. Therefore, it must be said that brands are highly dependent on the individuals and branding is not achieved overnight. For example, the city of Paris does not have a specific logo or a distinctive mark, but it is a big brand, and as soon as people hear the name of the city, they instantly recall different points of contact such as the Eiffel Tower, love, freedom, design, blue, white, and red colors. Such an example can be used in the case of many cities and countries. Also, strong brands would register some general features and factors in their name and turn into points of contact. For example, as soon as the audience hears Omega 3 in Iran, they would remember Talavang eggs. This is while all the eggs contain Omega 3.
Distinction, Distinction, Distinction
In branding a different saying should be made and distinction should be created and then emphasized, a constant distinction. If a brand says something different but does not emphasize on it, the audience will forget it in a short period of time as their concern is not just the business of that brand. Of course, this process is not enough and the brand should have once in a while something new and different to say and publish. Some brands offer a hurricane start of a product of high quality, but do not differentiate their competitive advantage, and so their memory would soon be erased from the mind of the audience. Such brands have not had a constant trend and have not repeated their distinction. For example, among the thousands of cholo-kabab (rice and kebab) restaurants, why only a few names have remained on the minds?
The big brands are made up by damaging the current beliefs of the audience. Therefore, learning the fundamental principles of branding is important, but under the new situations, these fundamental principles have changed and new words must be said. Because, if you want to work on all the principles mentioned in the books, you will create a brand like all brands in the market, and the principle of distinction that separates the brand from the rest of its rivals will not be obtained. In management science, the brand is designed on the basis of the findings of individuals, this science differs from mathematical science which is based on reality and data. In the management science, each theorist introduces a new theory that might violate the previous theory; while it is possible for both theories to be effective for different companies.
Marty Neumeier, one of the distinguished figures in the field of branding says: “Brand is the internal perception of an individual about a product, service, or anything else. If we want to simplify this definition, I must say brand is a person’s perception of a thing. In this definition, instead of the word thing, one can use many other words such as person, product, service, city, etc. There are some big brands that without taking the classic branding process have made many perceptions on the minds of the audiences and basically before formation, the abridged concept of the brand had existed. For example, as soon as the audience hears the name of Neishabur, they would immediately remember turquoise, Attar, Khayyam, proximity to Mashhad, etc. all of which create a distinct and close image for this city, like a brand.
Three Main Functions of Brand
In continuation, it is better to focus on the three core functions of the brand and branding industries in business success.
First Function of Branding, Tracking: The audience by seeing the brand name on the package would track it or buy it. It is possible that an audience by not seeing the desired brand in the store shelf would go to another store for shopping. Tracking is important in the market where different brands address one need for the audience. If a brand supplies only one product, then there’s no need for other names and other factors. Like the one who first produced tomato paste in Iran. Before that, the people would buy tomatoes and produce the paste themselves. With the arrival of the person who met this need, the people for the first time bought the tomato paste without considering the name, the production method and the quality of the paste. Therefore, if two people present a product to the market simultaneously, they would need to take other steps for branding. Because, it is possible that a brand takes advantage of the opportunity ignored by the other brand and brings about distinction and repeats that distinction for the audience. Therefore, in the case of brands, the time is over for the proverb: “The proof of the pudding is in the eating” and in addition to smelling, the pudding should be repeated and use all its capacities. Brand is basically originated from the competitive world.
Second Function of Branding, Reassurance: A brand that launches a product to the market for the first time as soon as notices another brand in the market in the same field has to mark its own brand. In addition, it must revise its production and improve its quality and do a lot of other things in order to attract the audience. At present brands should make different activities in order to be seen distinctively among the audience.
For example, once the production date would not be mentioned on every product and the audience would possibly use that product for years without any concern. But now brands are distinguished by mentioning the expiry date, and the audience has become sensitive and would react to any product whose date has expired, even paper tissue. The audience by receiving the reassurance from the brands would choose their next products. Therefore, branding is associated with the taste of the audience. For example, if you are sure about purchasing a brand of lemon juice, when you see another product of the same brand in the field of foodstuff, you will be determined to purchase it. As a result, the brands by offering their first quality product would invest in the rest of their products. Of course, brands should be careful not to be deviated from the path in which they are successful and should not enter the fields with no expertise. In this case, the audience will lose his/her confidence in their brand. It is because, expertise in the field of food, for example, does not mean expertise in the field of medicine.
Third Function of Branding, Dedication: The third application of the brand will be making money. The money used in the two previous applications should be utilized in order to make the third application. The audiences are given identity by using some products of some brands. For example, using Apple products gives the audience a feeling of difference. The audiences these days make identity for themselves by using different products. Friends, the way of dressing up, products used, etc. all shape the contact points of the personal brand. Therefore, when people are attached to a brand, they would enter a circle of the people who use that brand and will be willing to pay more than merely gaining a product.
Steps should be taken to form the branding process. Making investment and spending time in each step depends on the budget and the potentials of the brand.
First Step, Research in Branding: Every brand in the first step, whether being specialized in the field of activity or not, should make research about the industry it is expected to enter. The research includes: market conditions, activities that the competitors have done in the market, and activities that they have not yet met. At its best, the brand can probably manage to find a place for itself that others have not taken over in the market. Of course, the brand may find in itself potentials that as soon as it enters the roaring market, it would introduce itself. For example, if a brand in the field of dairy industry has achieved a technology that the rest of the competitors have no access, it is better to go for the red ocean strategy of the market and earn a lot of profit. If brands enter into a field without knowing the competition market, they should get help from professional research advisers otherwise, they should accept a high risk.
In order to enter the market, brands should conduct surveys on all those who have entered the market before them. They should not see just the successful ones. Gaining experience from the unsuccessful cases in the market is very important. Brands have to enter the market with a specific goal and should move in the right profit-making direction, otherwise few people would operate a billion worth business on the basis of humanitarian aspirations. Branding would be faced with failure in the absence of research.
Second Step, Strategy in Branding: At this point, the brand declares for what purpose it has entered the market and what are its distinctions. What new words it has to say and why the audience should choose it. If your business atmosphere requires short-term forecasts, for example, in the current situation in Iran, do not make the strategy over-complicated, because in that case, once one project is finished, a different strategy perspective should be defined. In such a market, it is impossible to accurately define the 5 or 10-year perspective. Businesses in such a market should manage crisis. Of course, working in this market is hard but possible and profitable. Iran’s market is situated in such a condition and if a business wants to be active in it, it will gain satisfactory benefit. It is because, the big and international giants would not currently enter this market.
Meanwhile, the topic of competitive strategy is one of the most important principles of branding. No brand without competitive advantage can enter the scene of competition and expect to win. A brand with no competitive advantage would be successful which is active in a competitive free market. In the first step of codification of the strategy the market should be segmented and based on it one of the segments in which the brand has the capacity to be present should be chosen. The economic, social, etc. factors should be considered at this stage. The brand, in order to localize the communication channel with the audience, should choose the path and the method that is expected to introduce the product to the audience.
Also, in outlining the branding strategy, a few questions should be answered. 1) What is the brand’s mission? 2) What is the brand’s vision? 3) What values the brand adhere to? 4) What is the character of the brand? 5) What are the functional and emotional advantages of the brand? 6) Why the audience should choose the brand and who will choose the brand? Answering these questions is of key importance in the branding industry. The brand must define distinct parameters as such no competitor could obtain its position. If a brand manages to obtain all the distinctions of another brand, the brand in question will lose part or its entire market share. The brand must always try to remain distinctive. For example, Harley Davidson, in a statement on his status, says: “I produce large and loud motorcycles for troublemakers.” What percentage of brands dares to have such a statement? Harley Davidson produces motorcycles for a specific audience and for the US environment, the motorcycles which are not necessarily applicable in other countries. Such a brand produces a product for the audience that wants to be anarchist. Therefore, it’s important to know that each brand is not necessarily suited to any environment and will not be successful. A brand should not try to keep all the audience happy. The brand must keep the target audience satisfied.
Third Step, Creativity in Branding: Creativity is the enjoyable and challenging stage in the branding process. This step usually begins with the designing of the name, which has several methods some of which are discussed below:
One of the denomination methods is known as the founder’s method. Usually in the field of fashion this is a common denomination method. In this case, the brand name describes the application of the product. Another method is the way the brand creates its name, and before that, there has been no name like the Kodak brand name. This is one of the interesting but hard ways of denomination. And the denomination method with acronyms, which is a simple method but its use is not very desirable, because usually euphonious names are not made through this method and remembering them is difficult.
In the third step, in addition to the name, the brand contact points are created and the brand communicates with the audience, and the audience pays for the final product whose contact points are seen and perceived. What we call brand identity is actually a collection of brand rules and principles in the area of contact points with its audience. Branding is a science.
Fourth Step, Brand Management in Branding: A brand that has taken the previous three steps should manage itself properly. Such a brand should constantly update itself and apply the latest knowledge and market methods on the brand and take advantage of them by localization.
Why Investment Should Be Made for Brands and Branding?
The brands, in order to enter into the market, are in need of huge money. Efforts have been made for each and every penny of the budget which should not be wasted. Not only every penny of this budget should return to the business, but the brand must also obtain its profit.
Also, influencing the understanding of the audience is another factor that draws the attention in branding and encourages brands to make investment. If a brand influences the perception of the audience and encourages them to buy, it has reached profitability. In this case, the audience from among thousands of brands would choose a brand that have understood it and liked it. A brand must convince its audience of its quality and diversity. This conviction would lead the audience towards buying.
In conclusion, reference would be made to the points on brand and branding architecture. Brand architecture is referred to the businesses, whether they are capable of being present in other areas of the market, or a new brand should be created to accomplish the task. The Korean brands and many East Asian brands usually offer all their products under one name. Such a model is called the branded house. But many American and European brands create a mother brand with subsidiary brands. Such a model is called the house of brands. Some big brands also choose the name of their subsidiary brands a combination of the original and new name, such as Nestle. In the Iranian brands, companies use such models. In sum, the brand architecture returns to the regional culture where the businesses are supposed to work. In addition, the formation of the brand architecture is also related to the business investment.