FASE DE CONFONTRACIÓN CON EL USUARIO E INTERCAMBIOS INTERNOS

An early theme, given much prominence in marketing circles, was the distinction between brands on the basis of whether the brand was a manufac-turers’ brand or a distributors’ brand (‘own label’, ‘private label’). Branding was seen as being a basis of showing who instigated the marketing for that particular offering and whether the primary activity of the instigator was production (manufacturers’ brand) or distribution (distributors’ brand).

However, this drew a rather artificial distinction, since nowadays consumers place a far greater reliance on distributor brands e particularly when brands such as Marks & Spencer and Harrods are perceived as superior brands in their own right. In fact, some would argue that with the much greater marketing role played by major retailers and their concentrated buying power, the concept of USP (Unique Selling Proposition) should now be interpreted as ‘Universal Supermarket Patronage’!

With greater recognition that a brand has to appeal to stakeholders rather than just consumers, that corporate endorsement engenders greater trust and provides an appreciation of unifying core values, there is a move to the corporation as a brand, rather than stressing branding at the individual product line level. This provides focus when developing a brand identity. There is a danger, however, that consumers do not recognise the values that the corporate brand stands for and how these run through all the product line brands. A further danger is that as a corporation widens its portfolio, its core values become diluted.

2 Brand as a differentiating device

The historical review earlier in this chapter indicated that, at the turn of the century, a much stronger emphasis was placed on brands purely as differenti-ating devices between similar offerings. This perspective is seen today in many 48 CHAPTER 2: Understanding the Branding Process

markets. Yet with more sophisticated marketing and more experienced consumers, brands succeed not only by conveying differentiation but also by being associated with added values. For example, the brand Persil not only differentiates it from other washing powder lines, but is a successful brand since it has been backed by a coherent use of resources that deliver the added value of a high-quality offering with a well-defined image. By contrast the one-man operation, ‘Tom’s Taxi Service’, is based upon branding as a differentiating device, with little thought to communicating added values.

Smallfirms seem to be prone to the belief that putting a name on their product or service is all that is needed to set them apart from competitors. They erro-neously believe that branding is about having a prominent name, often based around the owner’s name. Yet there is ample evidence that brands fail if organisations concentrate primarily on developing a symbol or a name as a differentiating device. Chapter 4 gives examples showing the danger of adopting brands solely as differentiating devices. Brands will succeed if they offer unique benefits, satisfying real consumer needs.

Brand distinctiveness allows customers to identify products and services. This occurs not only from the brand itself, i.e., through the packaging, advertising or naming, as shown inFig. 2.2. There are further sources to distinguish the brand.

First, consumers perceive the brand in their own way. As explained before, value is in the eye of the beholder and each person can draw very different conclusions.

Secondly, people interacting with the consumers affect their perception of the brand. Especially with consumer goods such as clothing, consumers focus their attention on certain brands as a result of conversations with peer groups.

3 Brand as a functional device

Some marketers overtly emphasise a brand’s functional capability. This stem-med from the early days of manufacturers’ brands when firms wished to protect

Distinctiveness of brand

From the brand itself

From the minds of those directly involved

From the people involved with the brand user FIGURE 2.2

How a brand can be distinctive

49 Brand Categorisation

their large production investments by using their brands to guarantee consis-tent quality.

As consumers began to take for granted the fact that brands represented consistent quality, marketers strove to establish their brands as being associated with specific, unique, functional benefits d for example, not just marketing a credit card, but a credit card augmented with a credit card protection policy and possibly also a concierge service.

Functional capabilities should always be focused on consumers, rather than on internal considerations. For instance, providing televisions in waiting rooms to make queues less annoying is less likely to be appreciated than a redesigned system to eliminate queues altogether.

Firms emphasising brands as functional communicators have run the risk of an excessive reliance on the functional (rational) element of the consumer choice, as all products and services also have some degree of emotional content in the buying process. For example,www.Amazon.co.ukpersonalises its customer’s website with recommendations based on customers’ past purchase history.

4 Brand as a symbolic device

In certain productfields (e.g. perfume and clothing) buyers perceive significant badge value in the brands, since brands enable them to communicate some-thing about themselves (e.g. emotion, status, etc.). In other words, brands are used as symbolic devices, because of their ability to help users express some-thing about themselves to their peer groups, with users taking for granted functional capabilities.

Consumers personify brands and when looking at the symbol values of brands, they seek brands which have very clear personalities and select brands that best match their actual or desired self-concept. For example, in the beer market there are only marginal product differences between brands. Comparative consumer trials of competing beer brands without brand names present, showed no significant preferences or differences. Yet, when consumers repeated the test with brand names present, significant brand preferences emerged. On the first comparative trial, consumers focussed on functional (rational) aspects of the beers and were unable to notice much difference. On repeating the trials with brand names present, consumers used the brand names to recall distinct brand personalities and the symbolic (emotional) aspect of the brands influenced preference.

Through being members of social groups, people learn the symbolic meanings of brands. As they interpret the actions of their peer group, they then respond, using brands as non-verbal communication devices (e.g. feelings, status).

50 CHAPTER 2: Understanding the Branding Process

To capitalise on symbolic brands therefore, marketers can use promotional activity to communicate the brand’s personality and signal how consumers can use it in their daily relationships. Nonetheless, whilst there are many product fields where this perspective is useful, it must also be realised that consumers rarely consider just the symbolic aspect of brands. Research across a wide variety of product and service sectors showed that consumers often evaluated brands in terms of both symbolic (emotional) and functional (rational) dimensions. Marketers should, therefore, be wary of subscribing to the belief that a brand acts solely as a symbolic device.

A successful example of combining both is given by Billabong clothing which offers the functional advantages of well-made surfing clothing with the appeal of showing the user’s sense of adventure and love of outdoor sports.

5 Brand as a risk reducer

Many marketers believe that buying should be regarded as a process whereby buyers attempt to reduce the risk of a purchase decision, rather than maximising their gain. When a person is faced with competing brands in a new productfield, they feel risk, for example, uncertainty about whether the brand will work, whether they will be wasting money, whether their peer group will disagree with their choice, whether they will feel comfortable with the purchase, etc. Successful brand marketing should therefore be concerned with understanding buyers’ perceptions of risk, followed by developing and pre-senting the brand in such a way that buyers feel minimal risk. An example of an industry appreciating perceived risk is the pharmaceutical industry. A company marketing a new drug suitable for children needs to consider the parent’s concerns about risk. One company launching such a product worked with a series of pain specialists in pediatric hospitals providing clinical data and product trials, so that specialist endorsement of the brand would reassure parents and help to minimise their perception of risk.

To make buying more acceptable, buyers seek methods of reducing risk by, for example, always buying the same brand, searching for more information, only buying the smallest size, etc. Research has shown that one of the more popular methods employed by buyers to reduce risk is reliance upon reputation. Some marketers, particularly those selling to organisations rather than tofinal consumers, succeed with their brands because they find out what dimensions of risk the buyer is most concerned about and then develop a solution through their brand presentation, which emphasises the brand’s capabilities along the risk dimension considered most important by the buyer.

This interpretation of branding has the virtue of being output driven.

Marketers, however, must not lose sight of the need to segment customers by similar risk perception and achieve sufficient numbers of buyers to make risk reduction branding viable.

51 Brand Categorisation

6 Brand as a shorthand device

Glancing through advertisements, one becomes aware of brands whose promotional platform appears to be based on bombarding consumers with considerable quantities of information. To overcome the problem of sifting through large amounts of information, brands are used as shorthand devices by consumers to recall from memory sufficient brand information to make a decision. There is merit in this approach, as people generally have limited memory capabilities. To overcome this, they bundle small bits of information into larger chunks in their memory and use brand names as handles to recall these larger information chunks. By continuing to increase the size of these few chunks in memory, buyers in consumer, business-to-business and service sectors can process information more effectively. At the point of purchase, they are able to recall numerous attributes by interrogating their memory.

There is a danger of concentrating too heavily on the quantity, rather than on the quality of information directed at purchasers. It also ignores the perceptual process which is used by buyers to twist information until it becomes consis-tent with their prior beliefs.

7 Brand as a legal device

With the appearance of manufacturers’ brands at the turn of this century, consumers began to appreciate their value and started to ask for them by name.

Producers of inferior goods realised that to survive they would have to change.

A minority, however, changed by illegally packaging their inferior products in packs that were virtually identical to the original brand. To protect themselves against counterfeiting, firms turned to trademark registration as a legal protection. Some regarded the prime benefit of brands as being that of legal protection. They put notable efforts towards effective trademark registration along with consumer education programmes about the danger of buying poor grade brand copies. For example, recent advertising for Kellogg emphasised the fact that the company doesn’t make cereals for anyone else and that the red Kellogg signature tells consumers they are buying a genuine article.

The success of retailers’ own labels intensified the need for manufacturers to protect their brands. Consumers can become confused by similar-looking competing brands. A 2004 survey found that up to 25 percent of consumers consider own-label products to be the same as branded products. Of even more concern, another study funded by the British Brand Group (BBG) in 2009 found that one in three grocery shoppers bought the wrong product because of its similar packaging. Such‘parasitic packaging’ is not a counterfeit, as it does not infringe trademark or design rights. However, it hijacks distinctive features of a brand’s packaging and the BBG study found that the packaging induces customers to recall the original productdwhich can boost sales by up to 50 percent. Over the last few years there have been famous cases of brand 52 CHAPTER 2: Understanding the Branding Process

warfare: Coca-Cola vs. Sainsbury’s Classic Cola; Van den Bergh Foods vs.

Tesco’s ‘Unbelievable’ Spread; Kellogg vs. Tesco Corn Flakes; United Biscuit vs.

Asda’s Puffin Bar. The last case is significant since this was the first time a manufacturer took a retailer to court and won the case, with the judge requiring an Asda pack change. This causes a dilemma for manufacturers who have tofind a balance between defending their brands against seemingly unfair competition andfighting against their own customers.

Because of their intangible nature, service brands have even greater difficulties coping with counterfeit brands. Financial services have shown a way to circumvent this problem by adapting a particular house style when interacting with consumers.

Finally, more enlightened marketers are adopting the view to which the authors subscribe, that brands should be treated as strategic devices. The assets constituting the brand need to be audited, the forces affecting the future of the brand evaluated and, by appreciating how the brand achieved its added value, a positioning for the brand needs to be identified so that the brand can be successfully protected and achieve the desired return on investment. To take full advantage of brands as strategic devices, marketing analysis and brand plan-ning is required, yet manyfirms are too embroiled in tactical issues and do not gain the best possible returns from their brands. Some of the key strategic issues associated with capitalising on strategic branding are covered in this book.

A good example of successful branding through majoring upon a differential advantage and ensuring the sustainability of such an advantage is the online search engine Google. Its innovations in technology made it the number one search engine. In addition, it has since developed such a successful AdWords methodology that 99 percent of its revenue is accounted for by online advertising.

This section has described the way that different characteristics of brands can be emphasised and has also highlighted the inherent weaknesses of each approach. A successful brand blends together these characteristics to present a unified, holistic promise which organisations can successfully deliver.