Branding – a marketing imperative

If we fail to brand, the market will brand us. The way the market brands us may not be what we want. Hence, it is imperative to be proactive about branding our business. A carefully designed brand can rationalise our price, differentiates our offerings and define our target market. These are just few benefits of branding. More important, a brand is the intangible asset of a business. Therefore it is sensible to invest into ones brand and be strategic from the start.

We tend to relate branding to logos, ads, celebrities etc. While these may be essential, they are a means to an end. The end here entails to what the business stands for, similar to a candidate in an election. Therefore branding ought to commence with a clear definition of the business philosophy or world view – read an earlier posting on marketing philosophy. A brand developed in the context of the philosophy will provide identity that relates to the market place.

If we can see brand as an asset – intangible – we will be prepared to set resource aside for branding. Let me explain the idea of intangible asset this way. When you eventually decide to sell the business, you would tally up the stock in hand, liabilities, and physical assets to come up with a figure that is the worth of the business. You will then account for the goodwill (intangible asset) of the business in the market, but you need evidence to justify the amount. The cliental could be used to demonstrate goodwill and justify the amount charge. Very often this may be a limited listed because of Pareto's 20/80 rule, (80% of the business comes from 20% of the clients). If you have developed a brand, then the size of the brand in terms of brand equity could justify a larger amount. Next time, will write on a branding approach based on Collective Intelligence that all businesses, small and large, can use.