On any given day, we are constantly exposed to a large number of businesses. From the toothpaste we use in the morning, to the long sequence of shops we pass by on our way to work, we encounter multiple companies that constantly compete with each other to grab our attention. It is this competition that makes way for a business’s success. This is where branding comes in. To ensure the growth of any business, branding is a necessity. But, before we dive deep into how important branding is, let’s first understand what it means.
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What is Branding?
Oftentimes, those who are aware of the term ‘branding’ confuse it with the business’s logo. This is especially true in developing nations where the concept of branding is not very popular yet. While logo design plays a significant role in branding, it is much more than just the logo of the business. The logo is a symbol or graphic that acts as an identification for the business. It acts as the face of the business and represents it in any visual communication carried out for improving the business’s awareness.
Related article: What Are The 9 Types of Logo Designs?
On the other hand, a brand is a perception created in people’s minds about the business. It is how people value a business and its products or services. Branding of a business is essentially the process of creating this value or perception in a person’s mind about the business through various ideas and processes that aim at improving the quality of any possible interaction between the business and the person. Thereby, turning a potential customer into a loyal customer.
The Origins of Branding
The roots of branding date all the way back to 2000 BC when branding was solely done to depict ownership. In fact, the term ‘branding’ itself is derived from an ancient Norse term ‘Brandr’ which means ‘to burn.’ Framers and craftsmen used to imprint their unique symbols on their cattle and goods as a way of marking ownership. These early stages of branding were carried out to make their products and cattle stand out from the rest.
While the fundamental concept of branding was in existence for a long time, it wasn’t until the 1800s that a more formalized version of branding began to take shape. Studying more about the History of Branding does make us go down an interesting rabbit hole.
The Benefits and Functions of Branding
While branding does many things in favor of building a business and ensuring its success, there are 3 functions it primarily serves:
1. Differentiation:
A well-researched branding helps a business stand out among its competitors, both visually and verbally. This is ensured only if the branding takes place after a thorough and in-depth market research and competitor analysis, wherein we study how the players that are already present in the industry are interacting with their customers, communicating their ideas with them, maintaining their brand image through consistent use of messaging and visuals that are unique to the brand.
2. Reassurance:
Since branding involves creating a perception in people’s minds, they tend to associate a certain value with that brand’s product or service. This could either be through short-term interactions like product packaging or through long-term interactions like advertisements on social media, billboards, etc. Now, when a person is in a position of choosing the brand’s product over their competitor's products, branding provides assurance that the person has made the right choice as it has already managed to create value for the brand.
3. Identification:
Now, in this world filled with numerous brands, it is essential for any business’s success that people only buy from them. To ensure this, people must always be reminded of the brand when they think of a particular product or service category. Branding helps achieve this by ensuring that the brand’s name, image, verbal tone, etc., are always on top of people’s minds. This is done through the use of consistent visuals and tone of voice that, over time, help people identify the brand even without any mention of the brand’s logo or name.
Related article: Why Does Everyone Love Starbucks? | Starbucks Branding Case Study
The Challenges of Branding
We have understood the importance of branding for growing a business into a successful brand and now, it’s equally essential to understand the challenges that are observed during the process of branding:
1. The Cost of Branding
Branding is extremely important for a business’s growth as well as survival among the sea of brands that we see today. And as with anything that’s crucial for the survival of an entity, branding also comes at a price.
As a popular opinion, it’s advisable for established businesses to spend around 4-10% of the business's annual revenue on its branding. And, if you’re just starting out with the business then it’s better to spend no more than 25% of the overall budget for the business.
Popular big-name agencies known for the branding of top companies would charge in 100s of thousands if not millions. Instead, if you go for freelancers for their affordability, it could be a compromise in the quality of the service. This is exactly where Brandzpree comes in. Firms like Brandzpree combine the quality of service of a renowned agency and the affordability of a freelancer as these firms put their heart and soul into focusing on building only one brand at a time with utmost precision, and are often led by a very small and extremely dedicated team.
2. Connecting with the Target Audience
The first step in any business is to understand the target audience and build up an ideal customer profile. This helps the branding to be crafted in such a way that anything communicated by the brand perfectly resonates with the target customers and helps turn a potential customer into a loyal one.
We, as people, are hardwired to relate to or resonate with other people. So, in order to make a person feel associated with the brand it needs to have a brand personality. This is created through a set of visuals, verbal guidelines, and tone of voice that come together to give the brand a human-like personality.
Modern brands like McDonald’s, Mercedes, and Samsung have been pioneers in their industries as they have understood the value of connecting with their customers at a very emotional level through the brand personality that they exhibit in an ad or any customer interaction.
3. Keeping Up with Trends
Trends are always a part of life. But, the important thing to note is that trends come and go. A lot of them become less significant and some of them even fade away with time. They are generally temporary in nature.
But the very foundation of a business is for it to survive strong in the industry for as long as possible, if not forever. While it might be attractive to jump on the ongoing branding trends, it will ensure only short-term gains.
It’s always good to be aware of the ongoing and upcoming trends but to ensure a business’s longevity it’s better to opt for branding practices that are timeless and memorable, without the influence of the trends.
The sweet spot, in my opinion, is to have timeless branding to be the business’s foundation and to experiment with advertising strategies that are at par with popular trends. This would cater to both short-term gains as well as long-term success.
Conclusion
Branding is, no doubt, essential for the growth and success of any business since it involves creating a perception in people's minds about the business and its products or services, and perception is what attracts a potential customer towards the brand.
In summary, branding serves three primary functions: differentiation, reassurance, and identification. However, branding also comes with challenges, such as the cost of the investment, connecting with the target audience, and keeping up with trends. Despite these challenges, branding is crucial for a business's longevity in the industry.
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