9- building a competitive brand
What's your next purchase going to be? Think. Did you think of a product, such as a new teapot or sweater? Or did you just think of a company name? Maybe you are planning on getting the next Apple iPhone or taking a quick shopping trip to your favorite store. Perhaps you really like the company that makes the product. In fact, maybe you choose what you are going to buy based on the brand name. If your response was more in line with the latter, your answer confirms what businesses already know: they are selling brands, not products.
The history of business goes hand in hand with the history of marketing. If you have something to sell, you need to make people aware of it. As more businesses begin to sell the same product, competition for customers for that product increases. Whether it's another restaurant, type of shoe, or lemonade stand, you need to market your product and position it so people know why they should buy it instead of another. Corporate logos can be traced back to the 1880s when businesses attached a personality to their product. However, many point to the introduction of television in the 1950s and 60s as the beginning of modern advertising. Suddenly, businesses had a captive audience to market to. With a small selection of TV channels available, businesses could reach large audiences. For instance, in the United States, more than 50 percent of the population might be watching The Ed Sullivan Show on a given night. Company logos reached icomc status during the 50s and 60s. Think of the red and white Coke label or the competing Pepsi symbol. Both soft drink companies have created images that have become so wed known, they are part of our print literacy.
The 1980s and 1990s brought another revolutionary change to product so competition and marketing. Cable and satellite TV increased the number of channels and programs available to people. The large audiences became fragmented. Businesses could only count on events like the World Cup for a guaranteed mass viewing audience. Marketing became even more essential. The over hundred-year rivalry between Coke and Pepsi heated up. Businesses competed for consumers by attaching more and more famous names to their product. TV ads became savvy, funny, interesting. Audiences began to look forward to commercial breaks during huge events like the Super Bowl or World Cup as part of the entertainment.
But businesses also begin to recognize something else: branding is more than licensing a logo, more than a good laugh in a thirty-second TV spot. It's about establishing a real relationship with the consumer and establishing a reputation. Why is it that the world consumes more than a billion Cokes each day? Coke has been able to enter foreign markets and compete with local products. Part of this is due to the company's ability to advertise locally. In cities in South Africa, for example, a relatively new market for Coke, nearly every store has a Coke sign. The other part of this equation is not how the company advertises, but what the company does. Coke sponsors sports events, economic development, scholarships, and other education projects. It's establishing itself in South Africa as a business with a conscience and a company that lends a helping hand.
In the 1990s, Nike, a sporting goods and clothing company, learned the importance of competing with a conscience when people found out that their products were being manufactured in sweatshops. Consumers were angry. They didn't want to buy from a company that supported child labor and unhealthy work conditions. Since then.-Nike has had to invest a lot of money in rebuilding its reputation.
And rebranding a company takes a lot of money. Just ask Apple, a leader in computer, phone, and music technology. During the late 1980s and 1990s, Apple increased its advertising budget from 15 million to 100 million U.S. dollars. As a consequence, Apple became the biggest computer company in the world. Apple changed its logo and message. It built an advertising campaign centered on people.
Marc Gobe, author of Emotional Branding, described Apple this way to Wired magazine: "It's like having a good friend. That's what's interesting about this brand. Somewhere they have created this really humanistic, beyond- business relationship with users and created a cult-like relationship with their brand. It's a big tribe, everyone is one of them. You're part of the brand." Like Apple, other companies recognize the bond that people form with certain brands. For instance, the Swedish furniture company IKEA produces the most widely read catalog in the world. This company has become a big hit in Europe and Africa, where the blue and yellow IKEA logo represents modern furniture design at an affordable cost. The Korean electronics company Samsung has also recognized the importance of establishing a quality brand. In the early 2000s, it invested money in its product design and saw results in consumer approval. In this case it's qualitative, not quantitative, analysis that helps businesses determine the consumers' regard for the brand. Essentially, it's how the consumer feels about the brand that sets the price a product will sell for. Naomi Klein, author of the book No Logo, best summarizes the phenomenon of branding: "Brands conjure a feeling." They have an identity, and people define themselves through these brands.
As media and technology progress into the twenty-first century, with audiences now streaming movies and shows online, it's not just flexibility that companies need to respond to via the changing media. To stay competitive, companies need to recognize the deep emotion that people have over brands, and they need the innovation to inspire it.
