Wednesday, July 4, 2007

Branding according to MarkStra

The word "branding" is in vogue by marketers and non-marketers alike to denot many things. Often it is to denote a "a not-independent" establishment (i.e. part of a global brand) or some major advertising effort.

But, what is branding really? The following is based among others on Jack Trout, Al Ries and Gerald Zaltman.

A brand is ONE word you own in the mind of the relevant consumer.
The key words are:
· One word (concept, belief, aspect)
· Ownership
· The relevant consumer
If done well that word enables you to differentiate yourself meaningfully from competitors in a way that consumers value and will pay for

That word and its ownership have value to you because they either:

  • Enable you to command a price premium
  • Drive volume
  • Increase the lifetime value of every customer (among others through loyalty)
  • Or a combination of these
  • With an acceptable ROI

The ultimate goal of a branding exercise is to determine:

  • what that word should be
  • how to achieve its ownership (in all aspects and by all means)
  • which consumer segment to weigh heaviest when seeking the above (because one cannot be all things to all people)

By this (true) definition of branding, every business, large or small, in a large market or a small market can embark on a branding excersize to "brand itself". For instance, even the smallest independent shoe store can brand itself as being the one with the most personal service. Let's assume that the customer values that. The store can achieve the ownership of this ONE word or concept for instance by remembering each customer's name, his sizes and preferences like no other shoe store does.

Even when a company is part of a larger group (a multinational, a chain, etc.), a company can still brand itself further for its specific market. For instance, being a Ritz Carlton hotel in Curacao is different from being a Ritz Carlton hotel in Aruba. If for nothing else, in Aruba the guest is more likely to be an American than in Curacao. In the same way, a Ritz Carlton in the city is different from a Ritz Carlton at the beach. Each can and should brand itself further (within company guidelines, of course). Otherwise, there is no difference for the guest if he chooses Ritz Carlton in Curacao or Ritz Carlton in Aruba. And, we know what than can mean for your revenue.

No comments:

Post a Comment