Literature review:
Branding; the opportunities and threats of creating a brand for a start-up. 第一部分
Introduction
The relationships between customers and companies have changed over the last century as consumers have gained balance power overtime. There are thousands of similar products in the market and customers have the power to purchase their preferred ones. While how to stand out from the massive competition is a question by all companies, branding has become a common way to differentiate products and services and hence sell more than competitors (Hammond, 2011). In the current dynamic market, every company is in a battle to create the best brand in its industry, not only to gain a market-share but also to dominate the market.
Nowadays, brands by themselves are no longer enough. Customers demand the functional attributes of products or services; the emotional needs and positive experiences with the services or products they pay for (Spiller and Bergner, 2011). These positive experiences can be the solution of their needs, concerns, hopes and joys, even in response to a need to escape from the realities of their daily lives (Kumar and Reinartz, 2012). While branding is a wide topic, my literature review is mainly focused on the opportunity and threats in creating a brand for a start-up company. The structure of the paper is such that it defines branding and gives a background concept on it, covers the opportunities and threats faced in the branding of a new business and then gives a conclusion and recommendation.
The concept of Branding
A brand is a unique name, symbol, word or logo or a combination of either that is used by a business to set it apart from its competitors (Dinnie, 2015). Therefore, branding is a form of a marketing strategy where a business uses a differentiated name, symbol, word, sentence, logo or a combination of some of these tools to attract and retain a client-base. Branding is a company’s promise to their consumers. It is about what the business currently is, what it wants to be tomorrow and how customers perceive it (Kapferer, 2012). What people feel about the company will have a huge impact and influence on whether their marketing will work or not. Brands don’t sell products, they sell a promise. For example, Coca-Cola has been selling happiness for more than 100 years, with their marketing strategy featuring the key word ‘happiness’ all along.
While in buyouts most buyers are focused on the tangible assets involved, multi-national company; Proctor and Gamble (P&G) bought Gillette which was a company that sold men’s safety razors and personal care products for 31 billion pounds in 2006, the tangible assets were only worth 4 billion pounds; majority of the money was paid for the branding (The wall street journal, 2005). This is a perfect example of the power of a brand.
Walter Landor’s quote, ‘Products are made in the factory, but brands are created in mind’ stands out. (Theng, Grant and Yap, 2013) Research shows that some product are actually made of similar content and sold at a similar price with the difference only being in the packaging yet one firm sells more than the other. Branding! Proper branding gives a company a right to sell their products or services at prices that competitors only dream of.
In a case of a start-up, a lot of work is needed to correctly brand a business. According to (Hammond, 2011), the key activities before the actual branding of a business includes critically thinking about one’s business and its future. Secondly, one has to determine the market targeted by their product. It enables outline potential clients and competitors operating in the market. It’s also important to identify competitors and determine how they use branding to their advantage. (Govers and Go, 2016); (Bishop, 2012) note that this mechanism can be used to come up with better strategies than those of competitors
