Activity: brands, branding, and COMP factors

Stephen Fanning

In the interest of full disclosure, the author does not endorse the use of the metaphor brand or branding in marketing – as it is historically associated with cruelty to and ownership of people and animals and the inference that power is in the hands of the owner. Furthermore, they are inchoate and overused terms. Reluctantly, as these are presently the accepted terms, they are employed to avoid confusion with existing textbooks. 

Brands are important for consumers and for organisations. This short article provides a brief description of brands and how branding strategies and tactics are a central part of the business-marketing planning process.

A synthesis of the academic literature indicates that – a brand is a longitudinal representation of the unique product value proposition of an organisation’s product[s]. Furthermore, a strategic objective of marketing practitioners is to design, develop, and deliver products that have a distinct, distinguishable, and discernible value proposition to customers – and – with time and consistent performance the products will develop a market reputation [keep in mind that a reputation may be one of dissatisfaction <> ambivalence <> satisfaction and may be a liability or an asset].

A brand is a collection of ideas [a schema] that influence a buyer’s decision-making process – therefore, brands become a heuristic or mental shortcut. It is generally regarded that brand recall, brand recognition and purchase intentions will be higher when a consumer has a favourable attitude. Whilst organisation carefully construct the ‘ideal brand’  – customers [ collective], based on their evaluations [cumulative], construct the ‘actual brand’ . Marketing scholars refer to the ideal brand as brand image and the actual brand as brand identity; the goal for marketing practitioners is to manage customer satisfaction to ensure that brand identity is congruent with brand image [the communication gap in the 5 gap model].

In sum: Brands are the collective and cumulative representations of a product’s value. Brands with a favourable reputation have higher recall and recognition and this leads to sales baseline growth [sales that are achieved without promotional incentives and discounting to drive sales].

In the interest of full disclosure, the author does not endorse the use of the metaphor brand or branding in marketing – as it is historically associated with cruelty to and ownership of people and animals and the inference that power is in the hands of the owner. Furthermore, they are inchoate and overused terms. Reluctantly, as these are presently the accepted terms, they are employed to avoid confusion with existing textbooks. 

Brands are important for consumers and for organisations. This short article provides a brief description of brands and how branding strategies and tactics are a central part of the business-marketing planning process.

A synthesis of the academic literature indicates that – a brand is a longitudinal representation of the unique product value proposition of an organisation’s product[s]. Furthermore, a strategic objective of marketing practitioners is to design, develop, and deliver products that have a distinct, distinguishable, and discernible value proposition to customers – and – with time and consistent performance the products will develop a market reputation [keep in mind that a reputation may be one of dissatisfaction <> ambivalence <> satisfaction and may be a liability or an asset].

A brand is a collection of ideas [a schema] that influence a buyer’s decision-making process – therefore, brands become a heuristic or mental shortcut. It is generally regarded that brand recall, brand recognition and purchase intentions will be higher when a consumer has a favourable attitude. Whilst organisation carefully construct the ‘ideal brand’  – customers [ collective], based on their evaluations [cumulative], construct the ‘actual brand’ . Marketing scholars refer to the ideal brand as brand image and the actual brand as brand identity; the goal for marketing practitioners is to manage customer satisfaction to ensure that brand identity is congruent with brand image [the communication gap in the 5 gap model].

In sum: Brands are the collective and cumulative representations of a product’s value. Brands with a favourable reputation have higher recall and recognition and this leads to sales baseline growth [sales that are achieved without promotional incentives and discounting to drive sales].

An organisation must consider & manage the prevailing situational factors [COMP]. Whist some factors may be controllable, other factors are beyond the organisation’s influence & require the organisation to adapt.

Situational Factors [COMP factors]

Managing situational factors is critical for marketing practitioners to achieve the 9 objectives of marketing practitioners. It is also important to consider that customers and organisations are, to a large degree, impacted by the same situational factors. Clearly, organisations have to understand the characteristics of their selected customers, on the other hand, customer decision-making is influenced by the organisational characteristics [including brand reputation], however, the market conditions will influence customer and organisational decision-making, and the  buying and selling strategies and tactics will vary according to the product characteristics [see product considerations].

Customer: Consumers approach or avoid different brands based on their awareness and attitude to a brand – we could call this brand attractiveness, brand reputation. Consumers form brand perceptions and expectations based on external communication with the organisation and others; however, based on personal experience with a branded product a consumer will construct a brand identity. It is worthwhile to note, that characteristics that may be attractive to a consumer in one market segment may not be attractive to consumers in other market segments. Consumers employ brands to estimate, assess, or evaluate different products in a market – this is often referred to as product differentiation. Therefore, an attractive brand provides an heuristic for quality and value and reduces risks.

Organisation: From an organisation’s perspective, a brand is the collective perceptions of the market and this may provide insight to future purchase intentions of consumers and therefore, the future financial benefit to an organisation; this value to organisations is often referred to as brand equity and often one of an organisation’s most valuable assets. The attractiveness of the brand will influence the effectiveness and efficiency of an organisation’s marketing activities; therefore, brands may reduce the costs of selling as a percentage of sales. Brands create a value for customers and at a collective level brands create a value for organisations. Like other assets a brand may be bought or sold and the brand equity will be determined by the forecasted return on investment. Not all brands are attractive to competitors as brands may be a liability or an asset. Additionally, brands allow marketing practitioners to align a product to a market segment and to position and price a product to compete in a market.

Market: Although consumers purchase products for the benefits they receive, they often organise their considered set of products on the basis of the brands they recall or discover during the search process. Likewise, organisations map their brands according to other brands in the marketplace. Therefore, brands help to organise the market and help to determine pricing strategies and tactics.

Product: Although there are some unbranded products, most products are branded products [even private-label products are brands]. Brands are the ideas – the product knowledge, that help position a product in the consumers’ mind. For customers, brands add value to a product because they are a heuristic, a mental shortcut; brands help customers estimate quality, value, and satisfaction. With repeat purchasing customers develop cumulative satisfaction this increases trust and reduces consumer perceptions of risk – this is referred to as brand loyalty. For organisations, brand loyalty will propagate channel support and assists retailers to attract consumers and often achieve a price premium within a product category. Brand loyalty reduces the dependence on discounting and sales promotions.

When undertaking a marketing audit, as part of the business planning process, marketing practitioners consider the customer, the organisation, the market, and the product; therefore, marketing practitioners should consider branding as an integral part of the business-marketing planning process and as an everyday activity outlined in the business plan, the marketing plan and specified in the various marketing action plans.

Source:  The marketing concept [e-book] available free to download from this website.