Eight Reasons Why Branding Is Important

8October, 2012



Justin Sutton

For a lot of people, branding is just one way to distinguish one product from the next. Brand names are present in just about any aspect of our lives, from General Electric, to Marlboro, to Levi’s, to McDonald’s.

But to companies, branding is a vital component of their marketing. The world’s most successful companies all have strong brands, which they spend a lot of money on. Technically, branding is just the mix of symbols, names, terms and designs that companies use to differentiate its products from others.

Branding takes a copious amount of research, a lot of money and a lot of brainstorming to do right. Why bother with branding? Here are the top eight reasons why branding is so important.

1. Branding helps distinguish you from your competitors. What sets you apart from generic products is your brand. A hotdog is not just any hotdog but an Oscar Mayer. It basically helps you fence off your customers from competition.

2. Branding means communication. Done right, your brand can easily communicate your company’s values, principles, message, and even characteristics. What do you think about when you see golden arches, or a Nike check mark? With a strong brand, you do away with having to bludgeon people about your company’s good characteristics and you can concentrate on your product’s selling points.

3. Branding helps you establish a reputation. For some people, the mere mention of a restaurant’s name makes them to crave for their food. Branding helps people have these associations with and feelings about your products. For instance, Nokia is known for durable mobile phones, while “you’re in good hands” with Allstate.

4. Brands promote customer loyalty. When a consumer has a good experience with your product, he or she will probably remember your brand, not your product. People would learn to trust your brand, so the next time they have the need for certain products and services, they will look you up. This loyalty would help you create an attachment among your customers and influence their emotional decisions.

5. Brands make it easier for you to introduce a new product. Strong brands pave the way for your business growth. Once people trust your brands, you can easily add another product to your product line or even get into a different area. Dove may have started off selling soap, but because consumers trust the Dove brand, they snatched up Dove body washes, lotions and deodorants when these new products were introduced.

6. Brands insulate you in times of crisis. Just imagine that you are a milk manufacturer in a country without brands. In it, groceries sell milk labeled only as “milk”. Now comes the contaminated milk scare from China. What happens next? Yes, do not expect that your product will sell!

Brands help you in times of trouble. When Toyota had to recall several of its cars, Honda overtook in terms of sales. Without brands, Honda cars would have been lumped together with Toyotas!

7. A strong brand can help you win in your consumers’ purchasing decisions. This is especially important in a market that allows for little differentiation in terms of product benefits and features. For instance, a white cotton undershirt. Without branding, people would just pick up the nearest package of undershirt they can get their hands on. However, having a strong brand, consumers would have certain expectations from your brand and some level of emotional buying, so they choose yours over the others.

8. Branding helps product recall. One of the key goals of marketing has always been product recognition and recall. You can spend millions of dollars in advertising and you could not hope to convert it into sales without product recall. A buyer might see your ad on TV and think that you have a good product, but then he goes into the supermarket and has a hard time remembering your product. He will think “that soap in the commercial” and hopelessly look at the variety of soap on the shelves. Branding helps your target market remember you, so that they think your soap instead of that soap.

What are you doing to brand YOU? Do you know how important it is?