The Value of Brand
Brands are the most valuable asset many company possessed. Yet they do not appear as assets on traditional companies’ balance-sheets. So, what are brands and why are they important?
A simple definition of a brand is a set of associations that a person (or group of people) makes with a company, product, service, individual or organisation.
How brand works?
Create image difference eg Coke without the brand is just cola drink, McDonalds without the brand is just hamburger, etc.
- It Inspire loyalty and preference
- It can be a status symbol eg. Mercedes, Rolls Royce, BMW etc
- It speaks of quality eg Malaysian property developer SP Setia charges a premium for their property.
- The highly successful Red Bull brand is associated with extreme sports. Without this association it is simply a energy drink company.
How Do You Create a Successful Brand?
Successful branding invariably involve the following elements:
- Creating Difference – they must be a different in your offering compared to your competitors. You cannot create branding with a non differentiated commodity.
- Adding Value – customers are willing to pay more for a brand if they perceived that they are getting more value.
- Connecting with People – successful brands not only has higher perceived value, but also have emotional appeal by drawing on people’s emotional relationship and value system. A good example would be The Body Shop philosophy of using natural products only and its stance against animal testing resonates very well with it’s customers base.
How much are they worth?
One of the best illustration of the value of brand is the following quotation from a Coca Cola executive:
If Coca-Cola were to lose all of its production-related assets in a disaster, the company would survive. By contrast, if all consumers were to have a sudden lapse of memory and forget everything related to Coca-Cola, the company would go out of business
Here is article on the top brands around the globe an estimation of much the brands are worth : Forbes – The World Most Valuable Brands
September 3, 2014 / /
Categories: business tips