Brand: Meaning, Objective, Benefit, Importance, Strategies

Brand: Meaning, Objective, Benefit, Importance, Strategies

An integral part of almost every product is a brand. Products and services are given names so they can be easily identified and promoted to buyers. Marketers must make many product decisions associated with brandings, such as brand names, marks, trademarks, and trade names.

What is a Brand?

A brand is a name, term, symbol, design, or a combination thereof, that identifies a seller’s products and differentiates them from competitors’ products.

Branding is a centuries-old idea whose time has not yet passed. Medieval artisans organized guilds to distribute their products as early as the middle ages.

Each guild required individuals to mark their items with a distinguishing symbol. The selection of an appropriate product brand, which produces maximum product acceptability, is an important part of the product development process. The term brand is a business term.

A brand name is part of the brand which can be vocalized. It should be remembered, however, that brand refers to anything that distinguishes one product from another.

Objective of Banding

Market control is the basic objective of branding. A brand is essential to the promotional activities of the firm. Through promotion, acceptance or preference for a product can be established among customers.

Suppose the product bears a manufacturer’s brand (brands owned by manufacturers regardless of the scope of the area served) and is available through many retail outlets.

In that case, the goodwill of customers is directed toward the manufacturer. Retailers will find it difficult to substitute other products for the branded ones that customers prefer.

On the other hand, if the wholesaler or retailer places his brand on a product, the goodwill of customers attaches to the wholesaler or retailer, and the manufacturer loses much of his control over the market.

Benefits of Branding

Branding can provide benefits to both buyers and sellers. Brands aid buyers by identifying specific products that they like and do not like, facilitating the purchase of items that satisfy individual needs.

Product selection would be random without brands since buyers could not be assured that their purchase was the preferred item. A brand also assists buyers in evaluating the quality of products.

A brand symbolizes a certain quality level to a buyer, which the person, in turn, allows that perception of quality to represent the quality of the item.

Another benefit a brand can provide is the psychological reward that comes from owning a brand that symbolizes status.

Sellers benefit from branding because each firm’s brands identify its products, which facilitates repeat purchases by buyers.

To the extent that customers become loyal to a specific brand, the firm’s market share for that product achieves a certain level of stability. A stable market share allows a firm to use its resources more efficiently.

When a firm develops some degree of customer loyalty, it can charge a premium price. Branding also aids an organization in introducing a new product that carries the name of one or more of its existing products.

Finally, branding facilitates promotional efforts because the promotion of each branded product indirectly promotes all other products that are branded in the same fashion.

Before starting a discussion on different brand-related decisions, we shall try to familiarize you with some of the key definitions relating to branding.


You already know what the term brand means. Let us reiterate it. A brand is a name, term, sign, symbol, design, or a combination of them. It is intended to identify the goods or services of one seller or group of sellers and differentiate them from those of competitors.

Brand Name

That part of a brand that can be vocalized – the utterable. Examples are Tibet, Aromatic, Wheel, etc.

Brand Mark

The part of a brand that can be recognized but is not utterable, such as a symbol, design, or distinctive coloring or lettering. Examples are types of letters used to write IBM.


A brand or part of a brand is given legal protection because it is capable of exclusive appropriation. A trademark protects the seller’s exclusive rights to use the brand name and/or brand mark.

The exclusive legal right to reproduce, publish, and sell the matter and form of a literary, musical, or artistic work.

Branding Importance: Why is Branding Necessary?

Now the question comes why do sellers prefer to brand their products? There could be quite several answers to the said question, of which the following are notable:

  1. Brand facilitates tracking down problems and processing of orders.
  2. Legal rights enjoyed by the seller protect the Imitation and copying of the branded item.
  3. A loyal and profitable set of customers can be attracted more by a branded item than a non-branded one, protecting the seller from the competition and giving him more control in marketing mix decisions.
  4. Segmentation is also facilitated through branding.
  5. It helps build the company’s image since brands can be advertised easily.
  6. Distributors feel comfortable handling branded merchandise, and consumers want brand names to help them identify quality differences and shop more efficiently.

Types of Brands

There are four categories of brands;

  1. manufacturer brands,
  2. private distributor brands,
  3. individual brand, and
  4. family brand.

Manufacturer Brands

Producers initiate manufacturer brands and make it possible for producers to be identified with their products at the point of purchase. A manufacturer brand usually requires a manufacturer to get involved with distribution, promotion, and, to some extent, pricing decisions.

Private Brands

Private brands are initiated and owned by resellers. The major characteristic of private brands is that producers are not identified on the products. Retailers and wholesalers use private distributor brands to develop more efficient promotions, generate higher gross margins, and improve store images.

Individual Brand

An individual brand is one used only for a single product. Individual brands have no obvious connections with the parent company. It is a policy in which each product is named something different.

Marketers use individual brands when they need to differentiate their own products, when their products are so diversified that a family name loses meaning, or when they want to protect their family name should one product fail or get negative publicity.

Family Brand

A family brand is one used for two or more of the company’s products. Family brands employ the name of the parent organization in some way.

Branding Strategies: How Branding Decision is Made?

A company should decide whether its products should have a brand or not. It is very difficult to find a product without a brand, starting from salt to airplanes.

However, it involves a cost for packaging, labeling, legal protection as well as risk, provided the product is unable to provide the desired level of satisfaction to customers. Marketing strategies for products include, among others, brand strategy.

Brand strategy is concerned with deciding which products should be branded and whether they should be sold under your own label or labels controlled by other firms.

Brands include all names, terms, signs, symbols, or designs that are used to identify and differentiate the goods of one seller from those of the competitors.

Brands allow the consumer to recognize the product and increase the chances for repeat sales. In addition, brands facilitate the development of permanent price-quality images for products.

Brands also simplify the introduction of new products and allow the manufacturer some control over the channel of distribution. Not all products can be branded, and many raw materials are bought according to specifications, and individual brands are meaningless.

Branding is easiest where identifying tags or symbols can be attached directly to the product and where the consumer is willing to use brand designations to differentiate among products.

Deciding whether to brand products and what type of name to use is a very complex process (see the following figure).

Brand: Meaning, Objective, Benefit, Importance, Strategies

A brand can influence sales and profits for the company if managed properly. Recently, consumers have become more receptive to generic or unbranded products.

Items such as fruits and vegetables, laundry soap, prescription drugs, and many others are now unbranded.

The decision not to brand is becoming more popular as generic products gain acceptance among more buyers simply because they are lower priced.

The marketing executive has two alternatives when making branding decisions, assuming the product will be branded. The executive must first decide if branding a product, whether to use a manufacturer or private brand.

Manufacturer’s brand

The manufacturer’s brand, as you know, is developed by the manufacturer, not a middleman. One advantage of using the manufacturer’s branding is its recognition by the producer. This is especially important when the product is innovative, distinctive, or of good quality or value.

The disadvantages of using the manufacturer’s branding center on the costs and added difficulties with cooperation from wholesalers and retailers.

When the marketing executive takes this approach to the brand, the company will almost always have to support it with an expensive promotional effort.

The other major disadvantage of using this type of brand is that middlemen do not give the product as much support as they do their own brands.

Thus, local promotional efforts may be less, and shelf-facing and good shelf positions may be more difficult to obtain unless the brand has a strong following.

Private brands

A private brand or middleman brand is one that is established and supported by a wholesaler or retailer.

Private brands have even become very popular in Western countries among high-status retailers who use them to combat the designer brands sold in other retail stores.

An advantage of producing products for a middleman’s label is that the manufacturer does not have to support the product with promotional efforts and other marketing efforts.

If private brands tap a different market, they offer the manufacturer an opportunity to expand the target market.

Finally, this approach allows the manufacturer to utilize excess production capacity without encountering added marketing costs.

The disadvantages of private branding include the loss of product control and the creation of competing products.

When the marketing executive chooses this type of branding, the firm almost assuredly will not be able to retain total control of the price, promotion, or extent of distribution.

The middlemen control these areas. In many instances, a private brand may also compete with a product branded by the manufacturer.

Selling both manufacturer’s and privately branded products may appear undesirable from the company’s standpoint.

However, it is one way for the company to maintain its own identity in the marketplace while also penetrating the growing private branding approaches taken by large retailers.

In particular, large retailers have increasingly demanded their own brands and have actively used them to compete against one another and against manufacturer brands.

Individual Brand

The executive’s second major branding decision concerns the use of an individual or family brand. Either can be used in conjunction with a manufacturer’s or private brand. An individual brand is one used only for a single product.

Marketers use individual brands when they need to differentiate their own products, when their products are so diversified that a family name loses meaning, or when they want to protect their family name should one product fail or get negative publicity.

From the company’s standpoint, several advantages are offered by individual brands. Most importantly, the failure of one product is less likely to materially affect the company’s image or its sales of other products.

Additionally, consistency in the product mix is unnecessary since the products are not tied together.

Family Branding

In family branding, all of a firm’s products are branded with the same name or at least part of the name.

In some cases, a company’s name is combined with other words to brand items. Using a family name allows marketers to promote a consistent image and make all advertising do double duty. Family branding offers two main advantages.

First and most critically, a successful family brand can strengthen the sales of new products.

Second, the costs of developing and promoting a new brand are reduced considerably.

In developing a brand, the objectives of the brand need to be carefully thought out. A brand is not just a means of drawing attention to the product: it should stand for something.

It must act as a cue (a stimulus that can potentially trigger a drive) to the product characteristics, including the product’s quality. Is it to be low, medium, or premium quality?

Is it to offer the economic appeal of value for money or the more emotional appeal of high price for a status product?

Brand Extension

A brand extension strategy is an attempt to extend the use of a successful brand name to product modifications or additional product areas.

It then occurs when a firm uses one of its existing brand names as part of a brand for an improved or new product that is usually in the same product category as the existing brand.

Brand extension offers a number of benefits to a company which includes; low marketing investment required to establish awareness and trial, low manufacturing investment, low R & D expenses, increased retail shelf space, and cross-flavor promotional opportunities – all resulting in increased profits.

The risks are usually quite minimal. Usually, the only major concern is that the extension might cannibalize existing sales.

Marketing executives considering brand extension should conduct consumer research to determine the existing brand’s assets relative to brands in different product categories and to indirectly competitive brands.

Multibrand Decision

In a multi-brand strategy, the seller develops two or more brands in the same product category. A company can pursue a multi-brand strategy if it tries to establish different features or appeal to different buying motives. It allows a company to cover more spaces of middlemen’s shelf space.

How to Reposition a Brand?

Periodically, it may prove necessary for a firm to reposition its brand; that is to say, to modify the brand in some way so as to widen its appeal or direct its appeal to another market segment.

This becomes necessary when, for example, the original market associated with the brand experiences a decline or when fashions change.

This usually, not invariably, also requires a modification in the product itself. This is an exercise that must be undertaken with considerable care. However, images, once established, may be hard to adjust.