In this article we will discuss about:- 1. Definitions of Brand 2. Types or Classification of Brands 3. Characteristics 4. Essentials 5. Advantages or Importance 6. Brand Policies and Strategies 7. Brand in International Marketing 8. Branding Problems 9. International Marketing and Indian Brands.
Contents:
- Definitions of Brand
- Types or Classification of Brands
- Characteristics of Brand
- Essentials of a Good Brand Name
- Advantages or Importance of Brand
- Brand Policies and Strategies
- Brand in International Marketing
- Branding Problems in International Marketing
- International Marketing and Indian Brands
1. Definitions of Brand:
Some definitions of brand are as under:
1. According to American Marketing Association- “A brand is a name, term, symbol or design or a combination of them, which is intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.”
2. According to W.J. Stanton- “All trade-marks are brands and thus include the words, letters, or numbers which may be pronounced (they may also include a pictorial design).”
3. According to Lipson and Darling- “The brand name is concerned with that part of the brand that can be vocalized.”
From the above definitions it is clear that the word ‘brand’ is a comprehensive term. It may be a name, some words, a design or a combination of all these. Thus branding means giving a distinct individuality to a product.
2. Types or Classification of Brands
:
The brands can be divided on the following bases:
I. According to Ownership:
A brand may be of the following two types on the basis of ownership:
1. Manufacturer’s Brand:
When a manufacturer uses his own name as brand for his products, it is known as manufacturer’s brand. For example, the use of the word ‘Philips’ on all the products of Philips Company like Bulb, Tubelight, Radio, Transistor, TV etc. Similarly, LG Company uses the word ‘LG’ on all its products, such as Refrigerator, TV, and Washing Machine etc. This type of brand is very popular and a large number of manufacturers use this type of brand, such as SONY, BPL, GODREJ, MARUTI etc.
2. Middlemen’s Brand:
When a manufacturer does not use any brand for his products and the middlemen like distributors—wholesalers, retailers etc., sell the product under their own brand, it is known as middlemen’s brand. For example, Bajaj Company uses the name of Bajaj on Iron though it is purchased from the market.
II. According to the Market Area:
According to the market area, a brand may be of the following types:
1. Local Brand:
When a brand is used for a local market, it is called local brand. Under this type of brand, the manufacturer uses different brands for his products in different markets.
2. Provincial Brand:
When a brand is used in a particular province or a particular state it is called provincial brand.
3. Regional Brand:
In this type of brand, a manufacturer divides the whole market of his products into several regions and uses different brands for selling his products in different regions.
4. National Brand:
When a manufacturer uses a single brand for marketing his products throughout the country, it is known as national brand. For example, Nirma soap.
5. International Brand:
When a single brand is used for marketing a product in all the parts of the world, it is known as international brand, for example, Parker Pen, Coca-Cola.
III. According to Number of Product:
1. Individual Brand:
When a manufacturer uses different brands for all of its products, it is called individual brand. For example, cars of Maruti Ltd. are marked with different brands such as Maruti 800, Zen, Alto, Versa, Wagon-R, etc. Similarly, all the toilet soaps of Hindustan Lever Ltd. are marked with different brands such as Lifebuoy, Lux, Rexona etc.
2. Family Brand:
When an industrial enterprise uses a single brand for all its products and for all the segments of its market, it is known as family brand. For example all the products of Bajaj Group are marketed with the word ‘Bajaj’, such as Bulb, Tubelight, Scooter, Iron, Toaster, Ceiling Fan, Table Fan, Mixer, Geyser etc.
Similarly, products of Jai Engineering Works Ltd. Kolkata market Fans, Sewing Machines, Cooler, and Iron etc. under a brand name of ‘USHA’. This type of brand is widely used in India. Almost all the big industrial houses use this type of brand like, Godrej, Amul, Tata, Lakme etc.
Some scholars use the word ‘Blanket or Umbrella’ brand in place of family brand, but some say that if family brand is used for product line only then it may be called blanket Or umbrella brand. For example, Tata, Birla, Godrej etc. use same brand name for all the products.
3. Product Line Brand:
When the business or industrial houses use different brand names for their different product lines it is called product line brand. For example, ‘Dalda’ is used for Vanaspati Ghee product line and ‘Super Surf’ for detergent powder line by the same manufacturer, i.e., Hindustan Lever Ltd.
1. Fighting Brand:
When there is very tough competition in the market and the producer wants to introduce a new product which has quite different characteristics from that of competitors’ brand and also gives an impression of such a difference, it is called a fighting brand. For example, Hindustan Lever Ltd. has recently introduced Wheel brand detergent.
2. Competitive Brand:
When the brand introduced in the market is almost similar to those of competitors, such a brand is known as competitive brand. For example, Surf, Nirma Soap, etc. are all having similar characteristics.
3. Characteristics of Brand
:
On the basis of above definitions following are the main characteristics of brand:
1. Brand is a comprehensive term and main objective is to make a distinct identification of the product.
2. The brand may include the words, letters or numbers which may be pronounced. They may also include a pictorial design but not include packaging.
3. Branding is helpful in sales promotion of a product.
4. Essentials of a Good Brand Name
:
Any brand name may be selected by a producer for his products. There are no legal restrictions, but it should not be similar to existing one, and he is free to select a brand in the form of any name, picture or mark.
Following are the essentials of a good brand name:
1. Simple and Short:
The name of the brand must be simple and short and easy to remember, for example, Dalda, Panghat, Coca Cola, 555, LG., Fruity, Liberty, BPL, Tata, Maruti, Bajaj etc.
2. Easy Pronouncement:
The name should be such which can be easily pronounced by one and all, for example, Palki, Ganesh, Param, Nirma, Hira, Moti, Modi, and Godrej etc.
3. Recognizable:
The brand name should not be imitation of others. It should be distinctive.
4. Memorable:
The name should be such which can easily be remembered. For example, Taj Mahal, Himalaya, Minar, Red Fort Quality etc.
5. Far from Obscene:
The name of brand must be far from obscene. It must be of the nature that no consumer may object it on this ground.
6. Economic:
A brand should not be very expensive for the enterprise. It must be economical to be printed, advertised or demonstrated.
7. Suggestive:
The name of brand must be of the nature that it may suggest the consumers to adopt a particular product or to do a particular work. For example- Sleepwell, Goodknight, Sunlight, Milkmaid Ice-cream, Zandu Chyavanprash etc.
8. Registerable:
The brand name must be capable of being registered to protect it legally. Name should not be restricted under any Act and also should not be closely associated with an existing brand.
9. Slogan Oriented:
5. Advantages or Importance of Brand:
No one is aloof from this creative task of branding that brings home a number of merits both to the consumers and producers.
The advantages occurring from the brand are as under:
1. Price Control:
The prices once fixed by producer cannot be altered by middlemen. Thus, the producer can exercise control over prices. The branded products are sold at same price everywhere.
2. Market Control:
The brand helps in creating brand loyalty among consumers. Therefore, a product used and liked by a consumer will be repeatedly purchased by him. Thus, the producer can be reasonably sure of his market share.
3. Incentive to Repeat Sales:
Once a customer has tried and liked a product, the brand enables him to identify it so well that he is tempted to buy it again and again. Brand reputation ensures market control as repeat sales become more likely.
4. Development of Market:
Producers can develop market for their products with the help of advertisement and sales promotion.
5. Assists Advertising and Promotion Programme:
When the product or products of an enterprise are marketed with a particular brand, it makes very easy for the enterprise to advertise its products because the enterprise can use the name of brand in its advertisement messages. Brand influences the customers. The customers prefer to use the products of a particular brand.
6. Convenient in Direct Selling:
When the brand of a producer becomes popular among consumers, it becomes very easy for the producer to eliminate the middlemen because he is in a position to sell his products directly to the consumer. It reduces the cost of distribution considerably.
7. Convenient in Expansion of Product Mix:
If the brand of a producer is very popular in the market and the demand for such products is quite encouraging, the producer may decide to expand his product mix. He can add new product lines to his product mix. It does not create any difficulty for the producer to create demand for these new products because his brand has already got popularity among the consumers.
8. Easy to Identify the Products:
Use of brand is very helpful in the identification of products. The producers can advertise their products with their brand and the consumers can identify such products easily.
9. Creation of Separate Market:
Producers can create a separate market for their products if they use a particular brand because the use of a particular brand differentiates these products from others.
10. Creation of Goodwill:
The brand helps in developing reputation for the products and creating an image in the public mind. It creates goodwill to the firm.
Brand offers following advantages to middlemen:
1. Convenient in Selling:
When a product of a particular brand becomes popular, the consumers ask for the product of that particular brand. Thus, middlemen can easily understand the needs, wants, tastes and preferences of the customers. Moreover, a middleman can sell the product of a popular brand very easily. Where demand for a particular brand is high, the sales of the enterprise also increase substantially, because the market for such product already exists.
2. Less Risk:
As the demand for a popular brand already exists in the market, the middlemen have no risk in keeping the stock of the product. The amount already invested in such stock is recovered very soon by selling the product in the market. In addition to it, the prices of such popular products do not fluctuate very frequently. Thus, it reduces the risk for middlemen.
3. No need of Advertising and Sales Promotion:
As the demand for a famous brand already exists in the market and the customers ask the product by brand name, there is no need for the middlemen to advertise such product. Moreover, sales promotion techniques need little expenditure.
4. Enhancement in Goodwill:
With the popularity of the product, goodwill of the seller also increases.
5. Increase in Profits:
As the goodwill of the business and the product increases, the demand of the product also increases. The profits of the firm will increase with the increase in the sales of the produce.
Following are the main advantages of brand name to the consumers:
1. Purchase Convenience:
Good deal of time and energy can be saved in purchasing of goods, if they are branded. A branded product renders product identification much easier and convenient. The money value of time and efforts saved will mean a substantial consumer solace.
2. Faith in Quality:
The producers who use a particular brand for their products, always keep themselves busy on improving the quality of their products because they want that the demand for their products should go on increasing. The result of such efforts of producers is that the consumers get the products of best quality.
3. Protection to Consumers:
Consumers find it easier to make complaint claims against those marketers of branded products in case their products fail to meet the declared claims of consumer satisfaction. Thus, consumers are provided with trade and legal protection against unfair trade practices.
4. Price Stability:
It has been the experience that the prices of the products of standard brands fluctuate very rarely. It brings certainty in the prices of these products.
5. Good Packaging:
The packing of the products of standard brands is always of high quality. The name of the brand and all the relevant particulars about the product are printed on packing itself. The packing of such products is very attractive, convenient and durable.
6. Easy Identification:
Use of a particular brand of a producer makes it very easy for the consumers to recognise the products of such producer because almost all the products of a producer are of the same brand, packing, design, colour etc.
6. Brand Policies and Strategies
:
Brand policies and strategies can be divided into three parts:
1. Brand policies and strategies adopted by manufacturers.
2. Brand policies and strategies adopted by middlemen.
3. Other brand policies and strategies.
1. Brand Policies and Strategies Adopted by the Manufacturers:
(a) Marketing Under the Own Brand of Manufacturer:
Under this policy and strategy the manufacturer sells all his products under the brand name of his own.
(i) Individual Brand
(ii) Product line Brand
(iii) Family Brand
(iv) Local Brand
(v) Provincial Brand or State Brand
(vi) Regional Brand
(vii) National Brand
(viii) International Brand
(ix) Fighting Brand, and
(x) Competitive Brand.
Main Advantages of this Brand Policy and Strategy:
It increases the goodwill of manufacturer. It facilitates in the implementation of advertisement and sales promotion programmes of the enterprise. It helps in bringing stability in the prices of products of the enterprise. It helps in controlling the marketing activities of the enterprise. It helps in adopting a suitable policy regarding product mix of the enterprise. The main drawback of this policy is that middlemen do not find any existence and manufacturers have to spend regularly on advertisement.
(b) Marketing under the Brand of Middlemen:
Under this policy and strategy, the manufacturer does not use any brand name for his products. He sells his products to the middlemen without any brand name. Here, middlemen are free to use any brand name selected by them for the products purchased by them. The main advantage of this policy is that the manufacturers do not concentrate on marketing of goods; they simply concentrate on producing the best quality goods at reasonable cost.
This brand policy has some disadvantages. For example, manufacturer depends upon the marketing policies and programme adopted by the middlemen. It unnecessarily creates competition among manufacturers. The middlemen may purchase goods from other manufacturers, if they agree to sell their products at cheaper rates.
2. Brand Policies and Strategies Adopted by Middlemen:
It includes the following two policies:
(a) Use of Brand of Manufacturer Only:
Under this policy, the middlemen sell all the products of a manufacturer under the brand name of the manufacturer. They do not use any independent brand name for the products. Main advantages of this policy are- Middlemen have not to make special efforts for selling the products. The middlemen get full advantage of the goodwill of manufacturer. Therefore, it increases the sales of the middlemen but under this policy middlemen do not find any existence of their own brand.
(b) Joint use of the Manufacturer’s Brand and Middlemen’s Brand:
Under this policy middlemen sells his own brand as well as manufacturer’s brand. Thus, the same product is marketed under two brand names.
3. Other Brand Policies and Strategies:
Other brand policies and strategies are:
(a) Multiple Brand Policy:
Under this policy, the manufacturer uses different brands for his different product items.
(b) Product Line Brand Policy:
Under this policy, manufacturer uses one brand for each product item in the same product line. Thus, different brand names are used for different product lines.
7. Brand in International Marketing
:
Today information technology and means of transport have made the whole world as a market and hence the development of market has become possible. But at the same time many cultural problems arise while making a brand international. The meaning of a brand name does not remain same in all countries due to difference in language and culture and beliefs and faith. By considering the current international business environment a brand can be made international.
Global Brand:
Some brands like Pepsi, McDonald, Coca Cola, and Parker are popular all over the world. This type of brand is known as global brand. By this type of brand, specific advantage of market development can be obtained. Although due to cultural and other factors the use of similar type of brand is not possible, e.g., cultural interpretation of colour, number, and symbol is different in different countries.
Similarly sometimes the meaning of one word is different in other languages. So global brand should be utilised after considering local factors and cultural matters.
Some important advantages of global brand are discussed as under:
(i) This type of brand is most popular, so sales promotion expense can be reduced.
(ii) Good sale is possible from the very beginning by the use of this brand.
(iii) Entry in new market is easily possible by global brand. For example, Pepsi was popular in Indian market before its entry in India. One thing regarding global brand should be noted that the product sold in different countries under this brand has not remained same in every country. For example, Indian Lux soaps produced by Hindustan Lever Ltd. are different in comparison to the market of other countries.
8. Branding Problems in International Marketing
:
Many problems arise for branding in international marketing.
They are as under:
(i) It is very difficult to take the decision regarding branding due to cultural and other factors in international marketing.
(ii) Sometimes before using the modified brand name in the country, the firm has to take permission and has to pay fees to the person, who was the first to register the same type of brand name in the country.
(iii) For small company it is very difficult to popularise their brand name in international market because huge expense is required for brand promotion in foreign markets.
(iv) Established and well-reputed importers of foreign country demoralise the use of exported brand because they prefer to sell the product under their own brand.
(v) In some countries the use of foreign brand is restricted. Some companies have tried to solve this problem by modifying the original brand name. For example, instead of ‘Mazda’ now ‘Swaraj Mazda’, ‘Hero Honda’ instead of ‘Honda’.
9. International Marketing and Indian Brands
:
There are many problems in selling Indian brand in foreign countries, in spite of many opportunities.
This fact can be corroborated by the following information:
So many Indian business houses and firms have created notable reputation in foreign countries and they can develop their brand in foreign countries. Reliance, Tata, Dabur are some of the popular brands in foreign countries. Indian brand can be used by attractive and high level marketing strategy.
There is a possibility of export business by developing one’s own brand for the experienced and reputed exporter. No problem arises for Indian exporter to sell the product under their own brand if the importer is selling the product without using their own brand. By purchasing foreign brand or by purchasing business of foreign firm including the brand, Indian company can sell their product very easily under the foreign brand.
Sometimes Indian company purchases a sick or weak company of foreign country with their brand and then after using the same brand sells their product in the foreign country on large scale, e.g. Arvind Mills of Ahmedabad has purchased ‘The Big Mill’ of Europe with their ‘Denim Brand’ and at present the company is selling large quantity of cloth under this brand all over Europe. Government of India has formed ‘Brand Acquisition Fund’ in 1996.
From this fund help is given to the company, who wants to purchase foreign brand. By joining foreign brand with their own brand, Indian company can use mix-brand. Export promotion agencies should manufacture the product according to the standard and by holding the permission these agencies can sell their product under their brand and symbol. For example ‘Darjeeling’ name is popularised by Tea Board of India in foreign countries.