Since beginning of the civilized world, a 100 years or so, branding has never been as important as it is now.
What is branding?
Branding is psychology & science bought together.
Products have life cycles. But brands outlive products. Its a no-brainer that if you have products you must invest in branding.
Brands convey a uniform quality, credibility and experience.
Brands are valuable.
Many companies put the value of their brand on their balance sheet.
When Tata Motors of India bought Jaguar and Range Rover from Ford, what did they buy? Factories? Raw Materials? Employees?
Goldman Sachs and Morgan Stanley helped Ford sell the brands to Tata for $2.56 billion, & the brands were worth more than all other things combined.
Likewise, when Kraft bought Cadbury for $19.5 Billion what did they buy? The chocolate? The factories? The recipes? The candy makers?
No! They bought the brands.
Branding is fundamental. Branding is basic. Branding is essential. Building brands builds incredible value for companies and corporations.
If you are still not convinced, let me give you another example.
The Dollar – An example of a world brand
The dollar is an example of an international brand. In essence it is simply a piece of paper, but branding has made it valuable.
It is a piece of paper that commands immense trust & respect.
All the tools of marketing and brand building have been used to create its value. On the front you will find the owner of the brand: the Federal Reserve. There is a testimonial from the first President of the United States, George Washington. There is a simple users guide: “This note is legal tender for debts public and private.” And if you’re still not convinced, the owner has added the all important emotional message: “In God We Trust”. The dollar is a world brand. It confers a uniform value globally. But as I said it’s really just a piece of paper. Branding has made it worth something.
Why branding is important.
There are a few reasons for this. Firstly, the world has come online and there are many new markets and a growing middle class. Secondly creating new brands is tough. Creating a new vibrant brand is a challenge which requires a sophisticated strategy. It is not just about a product and a name, it’s about a lot more.
Why branding is tougher but cheaper.
The sophisticated strategy I talked about earlier is a cultural movement strategy. I believe that building brands now requires a cultural movement strategy as opposed to simply a brand building strategy. A cultural movement strategy can accelerate your brand’s rise to dominance. Once you have cultural movement, you can do anything in a fragmenting media environment, maximizing the power of social media and technology. The world has changed. We are now living in the age of uprisings and movements.
Now building brands has become a lot less expensive and smart brands can take advantage of new tools and rocket up there globally, very fast.
In the face of the current economic challenges, it’s worth noting that brands do better in tough times compared to unbranded products. Brands outlive product cycles. And in these challenging times, there are still great brands being built. Brand owners still recognise opportunity and their brands will thrive in the years ahead. Brands such as H&M of Sweden, or Tesla a great new car brand, as well as new names such as Tom’s Shoes, Honest Tea etc.
No branding, no differentiation. No differentiation, no long-term profitability. People don’t have relationships with products, they are loyal to brands.
In a movement strategy, brands have a purpose that people can get behind. Brands can inspire millions of people to join a community. Brands can rally people for or against something. Products are one dimensional in a social media enabled world, brands are Russian dolls, with many layers, tenets and beliefs that can create great followings of people who find them relevant. Brands can activate a passionate group of people to do something like changing the world. Products can’t really do that.
In today’s world, branding is more important than ever. But you can’t simply build a brand like they did in the old days. You need a cultural movement strategy to achieve kinetic growth for your brand. With that, the sky’s the limit.