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14 March 2020

What is a Brand?

Tag(s): Marketing
The Education & Knowledge Development Committee of the Worshipful Compasny of Marketors, of which I am a Past Master, asked me to write a blog on the subject "What is a Brand?" Here is that blog.

There is extensive literature on the subject of branding and in recent years this has proliferated as the use of branding techniques, primarily developed for consumer products and services in the 19th and 20th centuries, has been extended into all walks of life. Individuals, charities, institutions, political movements, universities and sports clubs all now regard themselves as brands, and increasingly manage themselves as brands.[i]

A brand is a portfolio of characteristics that identify the subject to its target market and the public at large. This portfolio will include a name as well as physical identity such as a logo, design, livery and other distinctive features. But it may also include taste and smell if it is food, drink or perfume. It may include sound if it is advertised with a unique piece of music or memorable phrase. The key objective is to stand out from the crowd, appeal to your target audience, and reassure. A brand is a promise.

The history can be traced back as far as Egyptian farmers in around 2,700BC who marked their livestock with a distinguishing symbol using a hot iron. Thus, if the animal was stolen or strayed, they could identify it as their property. This concept was extended to seals and stamps on pottery and glass and then watermarks on paper by the Chinese. The Chinese also pioneered the identification of products with names of animals. The early guilds of merchants, forerunners of the Livery Companies, used such techniques in promoting their products. Twinings tea is the oldest brand to have been used continuously since the 18th century. Bass brewery was the first to register its logo as a trademark with the British government in 1876.[ii]

The concept of brand management as a formal discipline dates from the 1930s. Neil McElroy worked on the Camay brand for Procter & Gamble in Cincinnati.[iii] He was frustrated that he was not only competing with Lever Brothers and Palmolive but also with Ivory soap, another P&G brand. In a now-famous memo he argued that more concentrated attention should be paid to Camay, and by extension, to other P&G brands. Each brand should have a dedicated group devoted to thinking about every aspect of marketing it. This was taken up and it led to clearer product differentiation and segmentation.[iv] Today, nearly 100 years later, P&G remains the foremost consumer goods company in the world and continues to run a large body of brands with different names in its major product categories.

To create a brand we must first identify a consumer need, a gap in the market or develop a better mouse trap. We will need research evidence to support our argument that we have identified such a need and that our product or service will meet it. We will test our hypothesis, and then our prototypes.

We will need a name. “What’s in a name? That which we call a rose by any other name would smell as sweet.” As usual, Shakespeare got it right. Would it make any difference if Mr Sainsbury had made chocolate and Mr Cadbury opened a grocer’s shop? Except that Mr Sainsbury put his name over the door and Mr Cadbury put his name on the packaging. It was part of the promise. Jacob Schweppes produced the world’s first mechanically carbonated water on a factory scale in 1783 and his name is still on the label. Initials can also represent an individual as Joseph Cyril Bamford was the founder of JCB. Composites have been used like UMBRO which was established in 1924 by Wallace and Harold HUMphreys, two Brothers from Cheshire.  TE Stockwell, a tea importer sold a consignment to Jack COhen, leading to the foundation of Tesco. Acronyms can be used such as Psion which was founded by David Potter and initially called Potter Scientific Instruments Or Nothing.

Some names are partially descriptive but still may be abbreviated. Thus International Business Machines is known as IBM; Security Corps was shortened to Securicor which is now in the Oxford English Dictionary; and Vodafone is a composite of VOice, DAta, and teleFONE. OSRAM is derived from a combination of the names of two metals used in lamp manufacture: OSmium and WolfRAM.

Some brand names are ingenious derivations. Thus, the Saxon for Yeovil, GIVELE can be traced back to the 6th century and to 1086 in the Domesday Book. In 1901, William Henry Barrett’s cheese business, Aplin & Barrett, based in Yeovil, launched new products with a recognisable trademark St. Ivel.

Some are aspirational, thus Sunseeker seeks to be the ultimate in toys for boys, while Nottingham Grocer, FG Garton, the inventor of a brown sauce named it HP because someone told him that a bottle had been seen in the Houses of Parliament.

Some are comparative, thus Bill Lyons introduced the car of the future in 1935 with the distinctive model of a Jaguar on the front of the bonnet. Some are descriptive; in 1971 Sir Tom Farmer founded Kwik-Fit on a “drive in, while you wait” principle. Some are based on imagery, such as Orange which was chosen to challenge the business oriented mobile phone market in the UK in 1994 with the slogan “the Future’s bright- the Future’s Orange.”

Some are invented. George Eastman registered the trademark Kodak in 1888. The letter “K” had been a favourite of his, he is quoted as saying “It seems a strong, incisive letter.” He and his mother devised the name Kodak with an anagram set. He said that there were three principal concepts he used in creating the name; it should be short, one cannot mispronounce it, and it could not resemble anything or be associated with anything but Kodak. The founders of Sony also invented the name but did not quite follow Eastman’s example. It is short but it can be mispronounced as there are different ways to pronounce words with the letter “O” in the middle. However, they successfully sued a candy producer using the name who claimed that “Sony” was an existing word in some language.

The origin of one of the most powerful brand names in the world, Apple, is a matter of speculation. It has been described as knowledge from Eve’s tree of knowledge and as Isaac Newton’s apple from the discovery of gravity. Its designer said later that it was just to convey proportion. But why the bite? Some say that Steve Jobs had worked in his youth picking apples in a local orchard and that Mackintosh was his favourite variety.

A brand name can be registered as a trademark only if it is unique and not in the language. But a design can also be registered as copyright. Thus, the brand name Coca Cola is a registered trademark but copyright protects the distinctive Spencerian script and the contoured shape of the bottle.

Once we have developed and named our product and protected all our intellectual property we will want to create brand awareness, drive brand recognition and measure these factors as well as brand recall. Our volume projections can be calculated by measuring brand awareness times propensity to purchase times frequency of purchase. But we must also make the brand available for sale through distribution and thus we will endeavour to create brand power both in commanding the need for retailers to stock it and pricing power, i.e. the ability to withstand competitive pricing activity.

Over time maintenance of these actions will generate brand equity. Companies can only list acquired brands on their balance sheet, but in the valuation of these companies’ intangible assets including brands are often much more valuable than tangible assets. So not only is a brand a promise to its customers but it is also a promise of future value to its owners and shareholders if it is well – managed.


[i] As Liveryman David Haigh, Chairman and Chief Executive of Brand Finance, the world’s leading, independent, brand valuation firm, writes “David Beckham, Comic Relief, the University of Oxford, the Monarchy and Manchester United are all regarded as great and valuable brands.” Global Soft Power Index 2020 www.brandfinance.com
 
[ii] The best way to understand the development of brands in the last 150 years or so is to visit the Museum of Packaging and Brands which has marvellous time tunnels of brands and their packaging and other consumer goods like magazines and toys. The founder and curator Robert Opie is currently researching examples back to Stuart times. https://www.museumofbrands.com/visit/
 
[iii] 40 years later, I worked on it too.
 
[iv] The full story of Neil McElroy’s innovation is in the introduction to my book The 20 Ps of Marketing Kogan Page 2013 London Philadelphia New Delhi
 
 




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