What is a brand? (2023 edition)

We often talk about brands, but it is difficult to explain them clearly. Let's see how to explain the golden signboard with brand power.

When many people try to understand brands, they mostly see definitions discussed from an academic theoretical perspective. When they actually try to speak them out, it seems a bit like showing off one's knowledge, and the more they talk, the more confused they become.

What we are going to talk about today is not the traditional signboard, but the golden signboard with brand power.

1. Definition of Brand

There are two key words in the traditional definition of brand: one is to identify oneself, and the other is to distinguish oneself from others.

This is the logic of the signboard, which is the sign hanging in front of the store as a symbol. More people need the definition of the golden signboard. The existence of this prefix gives the brand branding power, which is to provide a basis for enterprises to make profits, make profits more efficiently, and even make profits more continuously and efficiently.

Therefore, from the perspective of understanding and practice, we define a brand as follows: a brand enables a company to have certain power, namely, name recognition, reputation, and premium power, thereby driving consumers' first and repeat purchases.

2. What is considered a brand?

A brand can be considered a true brand only if it has the five recognitions: awareness, approval, subscription, identification and recognition.

1. First of all, we need to know

Being remembered is the basis for being selected. If the company is not in people's minds, there is no possibility of being selected. Being known by a wide range of target groups is the first step in branding. Advertising increases product awareness, which in turn affects consumers' purchasing decisions.

2. The second is recognition

It is an improvement based on cognition, and positive cognition is the driving force for consumers to pay for products.

3. Subscription again

The commercialization of a product lies in being paid for by consumers. If it is not paid for by them, it cannot be considered a real brand.

4. Then come the identification

The recognition here is the logic of brand premium. Consumers believe that you don’t need to lower the price, and it is understandable that you can even sell at a higher price.

5. Finally, recognition

What you identify with is the values ​​​​advocated by the brand. The ceiling-level brand is about exporting a certain culture.

3. What is the use of becoming a brand?

The logic of brand strategy is to drive the branding of enterprises. Branding can sell products more efficiently and make enterprises evergreen.

1. Product layer

A. Improve product perceived value

Product perception = functional value + emotional value. Consumers sometimes buy not only cold products (functional value), but also a certain lifestyle or values ​​(emotional value). Branding is the support for the latter.

To some extent, emotional value will affect consumers’ judgment of functional value. Therefore, branding comprehensively enhances consumers’ overall perceived value.

B. Give the product a sense of trust

Branding plants the seeds of trust in consumers’ minds, thus affecting their perceived quality of products. Before consumers even come into contact with a product, or even after they have tried it, they will have some concerns about the product’s quality.

Branding is about building this sense of trust to reduce the risk of consumer decision-making and drive purchases.

2. Price Tier

A. Avoid falling into the vicious circle of price war

One-way competition in pure products can easily lead to price wars, and it is difficult for any survivors to survive in such a brutal and unscrupulous price war.

Brand power protects companies from price wars, while high prices become an important clue for judging quality. Companies without brand power suffer from this double squeeze.

For those who don’t know the brand, without sufficient information, price is a signal to judge quality, because in many cases, the general public firmly believes in the logic of “you get what you pay for”.

B. Improve corporate profit margins

When a product has brand power, the comprehensive value of the product = product value + brand value. This can improve the company's profit margin, form a good cash flow, and provide sufficient operating funds for crossing the cycle.

3. Channel layer

Channels are an important link for brands to achieve scale and profits. There are two types of relationships between brands and channels: passive push strategy and active pull strategy.

A. Promotion strategy

Companies without brand power need to enter channels by offering high commissions and profit-sharing, which directly stimulates them to be willing to store and sell products to end consumers. This is called a channel brand.

B. Pull strategy

That is, consumers drive brands, so that channels introduce brands to increase revenue. Consumers use their purchasing power to influence retailers, thereby "pulling" products in marketing channels. This is a consumer brand.

4. Promotion layer

A. Improve communication efficiency

Based on the brand recognition, each communication is an exponential superposition. Therefore, even if companies with different brand power carry out the same marketing activities, the influence may be very different.

B. Forming communication inertia assets

Even if a company with strong brand power has zero investment in a certain period of time, it will still occupy a certain purchasing command position in the minds of consumers.

Some companies need to continuously carry out saturation investment to achieve sales growth. Such companies are extremely dependent on investment, so the cost is extremely high, and they may become "stallors" at any time.

5. Competition Layer

In case of brand uniqueness difference, brand association is a barrier that competitors cannot cross, thereby effectively differentiating from competitors and gaining a place in the market.

6. Brand extension layer

Relying on brand power and based on trust, it provides a foundation for brand extension.

IV. Conclusion

For brands, trust is the core, information is the foundation, and faith is the other side. Brands are friends of time, trends are trends, and classics are classics.

There are too many illusions before our eyes. Let the bullet fly for a while. When the tide recedes, we will know who is swimming naked.

From a signboard to a golden signboard, only time can tell on this long, steep and snowy road.

Author: Zang Feng WeChat public account: Strategist Zang Feng