Creating a European branded business
A Dalgety case study

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Page 2: What is branding?

Dalgety 2 Image 1A brand is a particular product or characteristic that identifies a particular producer. Many mass-produced goods are almost identical. For example, most washing powders are very similar, as are different types of margarines. These goods tend to be produced by two or three large companies who encourage sales by creating a brand or marketing image which differentiates the products in the minds of the consumers.

The business of creating a brand is a particularly important function of marketing. Often people will buy the brand name as much as the product itself. You will see people in supermarkets pick up an item (which they have not seen before) and say, “this must be good because it is made by such a company.”

Large organisations know the value of the power of the brand. They will therefore fight very hard to raise the status of their brands and be determined that nothing will spoil this power. The brand itself will often be recognisable by a logo or trade mark. For example, when you look at cereal packets you will be able to see the Kellogg’s logo which identifies this brand; when you are looking for toothpaste you will be able to identify products from Colgate.

Organisations seek to create a portfolio of individual products which support the image of the brand. Well-known companies will therefore emphasise quality throughout the organisation. They will be very careful about which products to add to the portfolio. For example, organisations with up-market images will be reluctant to merge with or acquire companies producing down-market products.

A brand which is held in high esteem is worth a considerable amount of money to a company. There is a well-known saying in business that, “an organisation can afford to divest itself of all of its other assets, but not its brand image.”

The importance of the European market

The European market is very important to many UK companies. Lifestyles and buying patterns in many European countries have similarities with those in the UK. Today, there can be no doubt that UK trade is closely tied to the EU, as over half of our exports by value go to EU countries. The bulk of the EU’s trade with other countries is with the Western industrialised countries (about 60%), being made up mainly of manufactured products (64% of imports and 83% of exports in 1996).

Dalgety | Creating a European branded business
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