One of the most important decisions
that a marketer has to take in the area
of ‘product’ is in respect of branding.
He has to decide whether the firm’s
products will be marketed under a
brand name or a generic name. Generic name refers to the name of
the whole class of the product. For
example, a book, a wristwatch, tyre,
camera, toilet soap, etc. We know that
a camera is a lens surrounded by
plastic or steel from all sides and
having certain other features such as
a flash gun and so on. Similarly book
is a bunch of papers, which are in a
bound form, on which some useful
information about a subject is printed.
Thus, all products having these
characteristics would be called by the
generic name such as camera or book.
If products were sold by generic
names, it would be very difficult for the
marketers to distinguish their products
from that of their competitors. Thus,
most marketers give a name to their
product, which helps in identifying and
distinguishing their products from the
competitors’ products. This process of
giving a name or a sign or a symbol
etc., to a product is called branding.
Though branding adds to the cost
e.g., to the cost of packaging, labelling,
legal protection, and promotion, it
provides several advantages to the
sellers as well as the consumers.
- Advantages to the Marketers
(i) Enables Marking Product
Differentiation: Branding helps a
firm in distinguishing its product
from that of its competitors. This
enables the firm to secure and
control the market for its products. (ii) Helps in Advertising and Display
Programmes: A brand aids a firm
in its advertising and display
programmes. Without a brand
name, the advertiser can only
create awareness for the generic
product and can never be sure of
the sale for his product.
(iii) Differential Pricing: Branding
enables a firm to charge different
price for its products than that
charged by its competitors. This is
possible because if customers like
a brand and become habitual of
it, they do not mind paying a little
higher for it.
(iv) Ease in Introduction of New
Product: If a new product is
introduced under a known brand,
it enjoys the reflected glory of the
brand and is likely to get off to an
excellent start. Thus, many
companies with established brand
names decide to introduce new
products in the same name. For
example, Food Specialties Ltd. had
a successful brand Maggie
(Noodles), it extended this name to
many of its new products
introduced such as Tomato
Ketchup, Soups, etc. Similarly
Samsung extended the brand
name of its Television to Washing
Machines and other durable
products, like Microwave oven.
(i) Helps in Product Identification:
Branding helps the customers in
identifying the products. For
example, if a person is satisfied
with a particular brand of a
product, say tea leaves or detergent
soap, he need not make a close
inspection every time, he has to
buy that product. Thus, branding
greatly facilitates repeat purchase
of the products. (ii) Ensures Quality: Branding ensures
a particular level of quality of the
product. Thus, whenever there is
any deviation in the quality, the
customers can have recourse to the
manufacturer or the marketer. This
builds up confidence of the
customers and helps in increasing
his level of satisfaction.
(iii) Status Symbol: Some brands
become status symbols because of
their quality. The consumers of
those brands of products feel proud
of using them and adds to the level
of satisfaction of the customers.