There are millions of web pages and thousands of books on this topic, but if you’re looking for a simple and easy to understand the definition of branding, you’ll have first to understand another concept known as positioning.
What is Brand Positioning
In summary, positioning is differentiating a product, service, company or even a person from its competitors. When Al Ries and Jack Trout first introduced positioning back in the seventies through a series of articles, most marketing, and advertising experts discounted it by labeling it as another advertising buzzword.
However, over the last four decades, most experts have agreed that positioning is the fundamental concept to flush out before anyone starts working on branding and brand strategy
. It makes a lot of sense because brands don’t exist in the vacuum.
It is important to remember that the brand is not a logo or some visual identity. Often, people tend to confuse branding with the visual identity. However, it is essential to understand that branding is a much broader marketing effort than visual identity since it often involves brand strategy, market research, communications, advertising, and promotion. In summary, the brand is the knowledge and perception that is out there in public space about an entity whether it is a product, service, company or a person. Brands don’t get built overnight because it takes time to develop this perception and knowledge.
Branding can be further broken down at a much more granular level once the branding object is defined. For example, here is the famous advertising agency founder David Ogilvy’s definition of a brand:
“The intangible sum of a product’s attributes: its name, packaging, and price, its history, its reputation, and the way it’s advertised.”
As you can tell, there is much more focus on the product itself when it comes to product branding.
Why Does Branding Matter?
Branding is an important concept since it publicly differentiates a product, service or person from its competitors. Branding can be applied to the entire corporate identity as well as to individual product and service or even a business unit within an organization. Sometimes brands can invoke such an intense emotion that they can live on their own without much branding support from their corporate parent organizations. Scuderia Ferrari is an excellent example of this as parent company Fiat rarely adds any branding value to Ferrari’s heritage and reputation. Fiat is more of an administrative parent company in this instance.
Brands are often expressed in the form of tangible assets as well as intangible equity. For example, visual identity elements such as logos can provide graphic representations of the brand and can be quantified in terms of monetary value. A portfolio of intellectual property assets such as patents and trademarks can also be baked into brand value. Anyone remember when Google paid $4B for Motorola patents?