Great strategic branding begins with the name
A company’s name communicates the essence of the company’s product or service, forming the foundation of any brand. Naming presents a formidable challenge because legally available names that are clear, distinct and memorable are in short supply.
Imagine buying Coca-Cola from a vending machine and getting an unmarked can of pop with no familiar logo, nothing to identify it as a soft drink, let alone as the “Real Thing”. Would that product still be Coke as we know it? And would consumers purchase this product without its world-famous packaging? The company’s greatest success comes from selling its brand.
The importance of brand equity
It’s important to distinguish the factors involved in consumer decisions and how they affect aspects of a brand’s identity. You must first make the distinction between brand equity and brand valuation. Brand equity, like equity in a home, is meant to reflect appreciation – the good things and positive associations that accrue because the brand has delivered on its stated promises.
For example: consumers may pay $1.89 for a cup of Starbucks coffee when they could purchase the same volume for about 69 cents at another coffee shop. Most equity research tries to assess the strength of a brand through price premiums or market share. One simple way of assessing brand equity is to equalize the products, label them, and then see how much someone is willing to pay. For example, a coffee company may put the same brew in two containers – one labeled Starbucks and the other Bill’s Fresh Coffee. If consumers prefer the Starbucks coffee and will pay more for it simply because of the label, their choices appear to be determined by their positive associations with the Starbucks name.
The social context of a brand
Much of building a brand occurs in how it is marketed: the social context of a product’s use can be even more important than its attributes. Strong brands build emotional attachments. They attempt to develop a relationship. Jell-O is a prime example. Jell-O historically is a product that allows mothers and children to bond. It’s not the consumption of the Jell-O they remember, but the preparation, the colours, and the fun they had in making it – and Jell-O’s marketing activities reflect this.
Nike is an example of a company using a strong image to expand its market. When the company began, it carved a strong but narrow niche as a maker of high-performance athletic shoes. Nike’s fortunes changed permanently when they realized that everybody wants to be an athlete for 15 minutes a day. The company’s expanded product line, coupled with its “Just Do It” image campaign, transformed Nike from a specialty manufacturer into a global phenomenon. It wasn’t the physical attributes of the product that allowed them to extend the brand – it was the imagery they’d built around what it is to wear Nike.
In the beginning, Nike spelled its name. When they discovered true strategic branding takes place in the memory banks of our brains, they realized they could communicate faster than the speed of light with just a mark. Now when we see the swish mark, we immediately think “Nike”.