Branding Strategies
A branding strategy helps establish a product within the market and to build a brand that will grow and mature in a saturated marketplace. Making smart branding decisions up front is crucial since a company may have to live with the decision for a long time. The following are commonly used branding strategies:
Company Name
In this case a strong brand name (or company name) is made the vehicle for a range of products (for example, Mercedes Benz or Black & Decker) or a range of subsidiary brands (such as Cadbury Dairy Milk or Cadbury Fingers in the United States).
Individual Branding
Each brand has a separate name, putting it into a de facto competition against other brands from the same company (for example, Kool-Aid and Tang are both owned by Kraft Foods). Individual brand names naturally allow greater flexibility by permitting a variety of different products, of differing quality, to be sold without confusing the consumer’s perception of what business the company is in or diluting higher quality products.
Attitude Branding and Iconic Brands
This is the choice to represent a larger feeling, which is not necessarily connected with the product or consumption of the product at all. Companies that use attitude branding include: Nike, Starbucks, The Body Shop, and Apple, Inc. Iconic brands are defined as having aspects that contribute to the consumer’s self-expression and personal identity.
Brands whose value to consumers comes primarily from having identity value are said to be “identity brands. ” Some brands have such a strong identity that they become “iconic brands” such as Apple, Nike, and Harley Davidson.
Derived Brands
Some suppliers of key components may wish to guarantee its own position by promoting that component as a brand in its own right. For example, Intel, positions itself in the PC market with the slogan (and sticker) “Intel Inside. ”
Brand Extension and Brand Dilution
The existing strong brand name can be used as a vehicle for new or modified products. For example, many fashion and designer companies extended brands into fragrances, shoes and accessories, furniture, and hotels. Frequently, the product is no different than what is already on the market, except it has a brand name marking. The risk of over-extension is brand dilution, which is when the brand loses its brand associations with a market segment, product area, or quality, price, or cachet.
Multi-brands Strategy
Alternatively, in a very saturated market, a supplier can deliberately launch totally new brands in apparent competition with its own existing strong brand (and often with identical product characteristics) to soak up some of the share of the market. The rationale is that having 3 out of 12 brands in such a market will give a greater overall share than having 1 out of 10. Procter & Gamble is a leading exponent of this philosophy, running as many as ten detergent brands in the US market. In the hotel business, Marriott uses the name Fairfield Inns for its budget chain.
Cannibalization is a particular problem of a multi-brands strategy approach, in which the new brand takes business away from an established one which the organization also owns. This may be acceptable (indeed to be expected) if there is a net gain overall.
Private Labels
Also called own brands, or store brands, these have become increasingly popular. Where the retailer has a particularly strong identity this “own brand” may be able to compete against even the strongest brand leaders, and may outperform those products that are not otherwise strongly branded.
Individual and Organizational Brands
These are types of branding that treat individuals and organizations as the products to be branded. Personal branding treats persons and their careers as brands. Faith branding treats religious figures and organizations as brands.
Crowdsourcing Branding
These are brands that are created by the people for the business, which is opposite to the traditional method where the business creates a brand. This type of method minimizes the risk of brand failure, since the people that might reject the brand in the traditional method are the ones who are participating in the branding process.