Branding is a really common term in today’s business era. Every company today wants to have its own brand identity. It is often the first thing a person would think about when they are about to start a business. Why is brand identity so important and what purpose does it serve? In this post, we will discuss the importance of having a strong brand identity.
There’s more to a brand than just the logo, name, and tagline. It conveys the values, vision and persona of the firm. Brand identity is nothing but the identity an organization creates by which it seeks to identify itself in the market. This identity is what helps a company connect with its customers and convey its core principles and values to the customer. The ultimate aim of branding is to create a unique identity for the firm, to differentiate it from its competitors.
To get a little idea about the importance of a brand identity, let’s take a detour and look into the consequences of improper/poor branding.
It is important to position your brand in the market and ensure that all elements of the firm, including the employees, speak the same language as the brand. An absence of this consistency can lead to miscommunication between the business and the customer. The message that a business conveys through its branding may end up being perceived as something very different from what was intended. As a result, the business may have a negative brand image and therefore, lack of growth. Improper branding or lack of it makes it harder for a business to offer its products or services to potential customers, even if its offering is superior to its competitors’. This can, in turn, lead to a loss in sales. Yes, that’s basically a complete downfall of your entity.
That’s exactly why people make such a big deal out of branding- it is one of the most important assets of a business. A good grasp of how branding works will help a business convey its message in the intended sense and create a positive relationship with its customer base. Remember, building positive relationships with customers can take the firm a long way and can be a form of marketing by itself.
The question is, how? How do you do it?
Creating an Identity
Below are a few points that give a brief description of various factors to consider when creating a brand identity. Below are a few points to be considered while creating a brand identity-
1. A definite direction and position for the business
Creating an identity should start by analysing where the company stands and what its purpose is- values it wants to project to the market and deciding how it should be perceived by its customers. This will help determine the direction in which the firm will be taken forward, and ensure its sustenance in the long run. This can be done by performing a SWOT analysis.
- Strengths: Which aspects of the business gives them an advantage over its competitors?
- Weakness: What disadvantages do they have compared to the market competition?
- Opportunities: What aspects of the business environment can they exploit to their advantage?
- Threats: What elements could be a possible threat to the growth of the business?
2. Identify the target market for products and services
Every target market needs a different kind of brand presence. If a firm wants to target an audience between the age group of 20 – 30, it has to create an identity and devise its marketing efforts in a manner that would appeal to that particular audience. For example, the identity created by Apple for its iPhone is very different from the identity a company like OnePlus has created for its phones. Apple iPhone is targeted towards people who are willing to pay a premium price for products under the pretext that higher price comes with higher quality. On the other hand, OnePlus produces phones that have similar features of an iPhone at lower prices. Therefore, their target market is people who like more value for lesser money (more for less category). These are very different markets and Apple will invariably be related to a high cost, high-quality product while OnePlus will be viewed as a ‘value for money’ product. These two companies have managed to create a unique identity for themselves, that caters to their target markets.
When a person thinks of a certain brand, the first aspect they recall will be the products or services that the brand offers. So it is very important for a business to identify its target audience and create a niche for themselves.
3. Identify the business’ core values and principles
Every firm has its own values and principles that it brings to the market, and this defines the way it does business. The core values and principles set the foundation of the company and the manner in which it would be identified by its stakeholders. When these values are implemented in every aspect of the business’ operations, it helps attract and retain the best talent available, makes resource allocation easy, aids better decision making distinguishes itself from the competition, give it a positive image and helps in attracting more potential customers. Let’s say a company has values like “quality, integrity, pioneering, responsibility” -these values are going to be the foundation on which the company’s image or identity will be built. These four qualities will be at the core of all the products and services they provide. If it so happens that one of these values are breached, it will cost the business heavily in terms of brand image and consequently, revenue.
4. Pick the business’ personality
A business needs to decide how it wants to be perceived in the market. The brand image of the business is built based on its personality. This personality can be portrayed through the business’ marketing, its products and any kind of communication. Again, the aim of this step is to create a distinguished identity for the brand to go by. When someone thinks of GoPro, they will relate the brand to durable, handy cameras since it is mainly used for adventure sports. That is how it wants to be known to a customer. They will not be confused with other camera manufacturers like Canon or Nikon who make DSLRs. This type of identification gives the brand advantage by giving its target market a parameter to recall it by.
5. Fix on a Unique Selling Proposition (USP)
Although the above points themselves provide a business distinction from its competitors, every business needs a USP that needs to be a part of all its communication to its stakeholders. What is that one thing that sets the brand apart? What makes a customer think of brand A rather than B? There is always a difference between two competing companies; these differences have to be made very clear. One example that comes to my mind is the age-old USP of DeBeers- A diamond is forever. This has been in use since 1948 and has become a well-known phrase rather than just a USP. The reason it has become so famous and has worked incredibly well for them is that it says their diamonds are unbreakable and therefore a perfect symbol for eternal love.
A question that may come to your mind is, do the pros really offset the laborious perpetual process involved in creating a brand identity? You can decide for yourself once I spell out the advantages for you.
What are the advantages?
1. Creates awareness and boosts brand image
This is pretty self-explanatory. If I’m looking for basketball shoes, Nike is the first brand that comes to my mind. When I wondered why I realised it’s simply because I’ve seen and heard so much about the brand (positive) that now my mind is conditioned to think about it when I want basketball shoes. All marketing efforts of a firm needs to be directed at creating awareness and boosting the brand’s image.
Most customers will be inclined towards purchasing from a brand that is well known when compared to a brand that is unknown. Creating awareness is a really time-consuming and resource-heavy task, but if it is done well, and the brand becomes popular for the right reasons, the gains will be considerably higher than the resources spent on creating it.
2. Promotes employee motivation and retention
Who wouldn’t want to work for a firm that is perceived positively in the market? When a firm is famous for all the right reasons and has a strong brand identity, it is bound to have a better workforce than a company that does not have the same positive connection with its customers and target market. Recruitment, retention and employee satisfaction is on a higher scale with firms that put efforts into building a good reputation.
The top talents in today’s world look towards environments where they can learn and grow; they want to be a part of an organisation that will help them do that. If a brand is known for really good culture and values, the cream of the talent pool will be more inclined to work for them and might not consider joining another organisation.
3. Increases customer loyalty
Businesses rely solely on customers for their survival and they would want each customer to purchase their products multiple times. These repeat customers contribute a large chunk of sales to a business, so it is important for a business to retain its customers. When does a customer come back for more? When they’re happy with your product, your service and therefore, your brand. Customer satisfaction can by itself act as a promotional tool- word-of-mouth which is to date one of the most powerful marketing tools.
4. Aids sale of a new line of products
Having a good brand identity makes it easier to launch new products, even if it is a completely new line of products with no relation to the current product catalogue of the firm. Why? Because a strong brand will most definitely have loyalists who trust the brand owing to their past experience, that they will purchase new products/services the brand has to offer.
Take Apple for instance- Apple back in 2007-2009, was known for its high-end smartphones and Macintosh computers. Much later in 2010, they came up with a completely new product category-tablets and called it an iPad. Even though iPads were not completely new to the market (there are a few other companies offering similar products), sales of iPads were higher than all other tablet computers in the market. This is primarily because Apple has a large group of loyal customers and is always related to premium products of the highest quality.
5. Increases the overall credibility of the product
Credibility is a psychological factor that makes a customer buy a product that the firm offers. Most often, a person would opt for a brand that is deemed an expert in that particular field. A few factors that can influence the credibility of a brand are the longevity of the products and the quality of service provided. A positive brand image that showcases the capability of the company and the quality of services they provide, will help create and maintain credibility.
A brand identity is not constant; it is always evolving and changing based on customer preferences and the business environment, which is why it needs constant attention. It plays a pivotal role in deciding if a business goes north or south. However, there is one key constant factor that always dictates how your brand is perceived- your customers. A good review can go a long way but a bad one almost always goes faster and longer.