Imagine a black Ferrari and a black Rolls Royce. Why is it that when you imagined a Ferrari you thought about speed? Consequently, why did you think about luxury when you imagined Rolls Royce?
Was this a coincidence?
Of course, not. How and why was it possible then? The answer lies in a phenomenon that we call Branding!
What Is A Brand?
While brands are very common in our everyday life and sway our decisions, it is very difficult to define exactly what a brand is.
Investopedia defines it as “…an identifying symbol, mark, logo, name, word, and/or sentence that companies use to distinguish their product from others.”
But a brand is more than just an identifying symbol or logo or name. A brand is itself an identity, and while it may be intangible, it is usually one of the biggest assets of a company.
Take Apple, for instance. Even when Steve Jobs – the man that created the company – was thrown out, people continued to trust the brand. This was because the identity that customers related with was the brand, not the man behind it.
That is why 91% of people will buy from an authentic brand in contrast to unbranded commodities. Goes without saying, a brand can have a huge influence on your organization.
Why Should You Invest in Branding?
Understanding what branding is, is only half of the game. Using it to add value to your product is what really matters. Of course, customer acquisition is one of the most important factors in satisfying your bottom line, but it is not the end all be all. There are other important reasons to invest in branding that you just cannot ignore.
Here is why you should invest in branding:
1. Helps Amass Brand Equity
Why is it that Apple can demand exorbitant prices for its devices and still grow its sales? Because of its brand equity. Any brand builds this equity by offering products that customers remember. In doing so, it derives inherent value that enables it to charge higher prices for its products as compared to generic products.
This very brand equity later enables a brand to diversify its portfolio and offer a plethora of new services. Would you be able to amass brand equity in absence of a brand?
2. Helps Consumers Connect
Any brand brings a story. Nike is about breaking the barriers and just doing it, Target is about convenient shopping, Rolls Royce is about luxury, Lyft is about convenient and environmentally friendly travel. Each of these brands will appeal to the customers that resonate with its story.
The CEOs will buy Rolls Royce, people short on time will visit target and so on. This is one of the biggest advantages of branding – it helps people connect with you. With this connection, comes loyalty that doesn’t break easily. Last we checked no brand could say no to that.
In conclusion, you can never underestimate the importance of branding, it can changes the way a potential customer perceives a product or service, a logo; if you buy logo options you can create the the right impression. So, the next time someone asks: “is branding important?” you should know that the question is not even worth answering.