Branding of a product is important for both buyers and sellers. For buyers, branding reduces the random nature of product selection. It helps them to identify more easily products that may satisfy their needs and enables them to reduce time spent on evaluating alternatives. A brand also represents certain qualities and characteristics which they may use to develop a clearer picture of what the product offers.
Sellers also benefit from brands, particularly if they can develop the brand loyalty of the buyer, which leads to repeat purchases. New products which carry a familiar brand are more likely to be successful because consumers are aware already of that brand name. Branding also simplifies the process of promotion. The repeated exposure to the market of the brand name may help develop other products.
Brands are valued for reasons other than the profit they bring their owners. They are a property with legal protection and a value in the market. By valuing brands, a company’s balance sheet is strengthened, its share price may rise and its vulnerability to predators decreased.
Consumers identify products in a variety of different ways. A brand image comprises a range of features which identify the products of a particular organisation e.g. a name, sign, term, symbol or other creative elements. A trade mark provides legal protection of the brand for its owner, covering design, brand name and abbreviations. This protection can be extended to cover colours and shapes.
Branding provides unique selling propositions (USP) which help to differentiate the product from its competitors and, therefore, make it an essential item for retailers to stock. The creation of a brand image, which matches customer needs more closely than competitor products, is a function of product positioning. When consumers make purchases, they attempt to match brand image with self-image. The brand, the retail outlet from which it is purchased and its promotion will all have a symbolic value for the customer. How will the benefits of a brand and its protection by a Trade Mark work in practice?