Valuing Your Brand

A brand, if well managed, becomes an increasingly important factor of success, regardless of industry. Some companies, though, do not realize this potential; instead, their brand is registered with consumer protection agencies and appears on websites for dissatisfied customers.

Brand management, or “branding,” as it is known, plays an ever more relevant role, given increasing competition and the consequent need for companies to stand out, to differentiate their products and services and, thus, their image in the client’s mind.

Most people can think of brands that so dominate their market as to be virtually synonymous with their sector. Examples of product categories include steel wool, photocopiers, razors, soap and beer, among others, where certain brands have the strength to define the entire category. The actions of big brands can be perceived through “brand equity,” an approach developed by David C. Aaker, which highlights a set of brand-inherent resources that add value to a product or service, and so provide market gains.

But in the final analysis, what is a “brand”?

A brand can be understood as a set of tangible and intangible elements, represented by a logo, which influences the consumer and generates value for a service or product and company. According to the American Marketing Association, a “brand” is a “name, term, design, symbol or any other feature [or a combination of these elements] that identifies one seller’s good or service as distinct” from the competition.

The use of brands is not a new phenomenon.

Prehistoric hunters engraved their marks on their weapons to indicate property; ceramicists from Greece and Rome pressed their right thumbs into the damp clay pots to indicate origin; in the Middle Ages corporations and families used heraldic symbols; medicines and tobacco were branded in early USA; eventually, we come to the brands with international recognition.

The relevance of brand management is proportional to the importance of having a brand that is effective with the target market, optimizing its value in relation to company results. In recent years, branding has gained visibility. Increasing competitiveness, coupled with a more demanding and rights-conscious customer, has highlighted the need for differentiation. In this sense, brands play a decisive role.

The brand influences the purchase decision and facilitates business transactions. When a customer recognizes a brand, s/he acts on trust, satisfaction, or feelings of security, or enacts self-expression, and the brand reduces risk. For companies, a strong brand increases the effectiveness of marketing strategies, enables the implementation of relationship and loyalty programs, provides greater financial returns, provides legally protected (trademarked) differentiation, assists in order processing, provides a basis for corporate image, and is a source of clientele segmentation.

Achieving brand success is no simple activity for the professional involved in its creation and development. Many are the elements and attributes needed to develop a strong brand. Obtaining the most information possible on the market, performing analysis of the business segment, getting to know the market well, analyzing the competition and the consumption habits of potential customers – all are of great relevance and part of the development process. Another fundamental aspect is the identification of changes in the scenario where the brand is inserted, as interaction between consumer and brand must always exist, due to environmental changes.

For these reasons, brand management has emerged as an area of ​​study of brand identity as a variable to deal with an increasingly complex and competitive market.

(Published in the A Notícia de Santa Catarina on July 29, 2010.)

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