Marketing essay on: IBM
1. Introduction
‘No one ever got fired for buying IBM’. The story of IBM helps to define exactly as what separates a brand form a product.
Branding can be said to be a process of strategy formulation, which involves all areas of the organization in its execution. Branding is about marketing but not confined to marketing department alone. Brands should always deliver value where the value is defined in terms of the consumers. Brand image can be said to be a phrase, which exists in the minds of the consumers, which is the total information that is received about the brand (Anon, 2011).
This happens by word of mouth, advertisements, packaging, services etc that is modified by selective perceptions, earlier belief, social norms etc. Brand identity is what that is transmitted to the market place which is under our control if the organization understands the essence and expression of the brand. There are four dimensions for the brand; Function, Personality/ image, Differences, Source. The dimension forms the essence of the brand at the centre. A brand identity can be said to be strong where the dimensions are consistent and they support each other. If the dimensions are weak or are, sending conflicting messages the image, which results in the minds of the consumers may be, blurred.
Factors which impact the value of a brand are the markets which are served by the brand, the number of separate and distinct brands, the organization size, the alignment of the divisional responsibilities with the responsibilities of the organization; dependency on retailers, brokers, wholesalers etc for reselling the products to the end users and consumers. Brands represent much more than recognizable name, a memorable mark or logo or catchy tag lines. Brand is more than distinguishable products with practical physical advantages for the consumer (Walton, 1977).
It can be said to be an embodiment of a relationship between the organization, the brand, its consumers and the employees. The customer attaches a meaning to the visible cues, which is dependent on the consumer’s experience or perceptions. It is the customer whodetermises the true value of the brand. Brand serves as a rallying point by uniting all the stakeholders with a common set of values and the expectations about what the brand is for what the brand stands for and what sets it apart from its competitors.
Branding is a key factor for successful marketing. Many products as well as services sold without branding. Top Brands such as Sony, IBM, Nokia, Microsoft, Nescafe, Colgate, etc are all different corporations across the Globe. However, these brands have not been translated into each language, but are used as such, thereby forming a part of the local languages, even though these names were considered were a foreign word initially. They shall take the meanings of their own within the particular regions and its language. The image of the brand may be across the world whether it is with slight changes or adaptations for suiting the the local country where it is represented. The brand name helps to distinguish the goods of one firm from that of another. This is a shorter way for both distinguishing the goods or services, but the psychology related to branding goes beyond this.
There are five main functions of brands, which are listed as
1) Brand identity: The brand should clearly specify the identity clearly so that the names, the legal protection and the design elements are important
2) Summary: Brand identity should act as a summary of all the information, which the consumer holds about the brand.
3) Security: Purchase of a familiar brand is re assuring. Brands should guarantee for providing the benefits expected.
4) Differentiation: The brand should differentiate from the competitors and should show the customers how the brand is unique
5) Added value: The brands should offer more than a generic product
Great brands help to give these benefits. Brands should also excel to offer price, functional benefits or psychological benefits.
2. Branding vs. Quality/Customer Service?
Value is greater than economic or mathematical calculation. It can be said to be the perception that the resources a person receives in the market place exchange are more than those which are given up in comparison to alternate choices. The resources shall be easily measurable in terms of currency, information or the time. This can also include the intangible factors such as love, status or sensory gratification. This implies the difference between customers and consumers. Consumers form the end users while customers can help in transforming an intermediary output to something different (Sriviroj, 2007).
The quality of service forms a competitive advantage for gaining market leadership; customer service helps to build the brand value of a product. When customer interactions help to form the perceptions, which is formed through the exposure with the marketing communications. Great customer companies face the challenge while preparing the marketing campaigns what should be the primary promotion of their brand as branding or customer service. Ideally, both should be valued for gaining a competitive advantage. Business branding is based on communication of the brand mission, the promise and value depending on the emotional attachment of consumers. That emotional attachment occurs due to the experience of the customer with the brand, and how the customer service nurtures this bond between the brands and customers. The sustainability of the brand depends on the marketing strategies, which finally boils down to the customer satisfaction. Use of branding or customer service is desirable. Starbucks spent fewer amounts on advertisement; instead, they built the builds the brand by word-of-mouth and the attraction of their storefronts. The company continued to extend the Starbucks brand and for penetrating new markets, the organization had recently begun selling its coffees in supermarkets.
Customers can investigate a brand through the product reviews and by searching through a websites for reading the brand product, which are offered currently. A customer will not proceed to purchase until he acquires the information about the product from the brand. Organizations understand that the customer satisfaction understands which of the two is important i.e. is branding or service. Customer service can be called as an insurance policy a business has on the quality and the performance of the brand. A customer service plan should profile the needs of the customers, the complaints, the concerns, purchase habits and the feedback of a particular brand. The customer service is used by business for enhancing the marketing campaigns of a brand since the customer service is invaluable for business (Ryder, 2005).
Branding is also enhanced through the product quality, the service, performance and warranties as well as the overall product value. Branding can be said to be a way by which a business extends to the customer, mainly through a good service plan. The practice of a brand value and the quality given by good customer practices help to ensure repeated customer business. Testimonials by customers who find the quality of the brand to be the most valuable are the ultimate goal of business. The value, which is placed on these testimonials help to monetize the brand before the public. In order to obtain the credentials, the business should have a proven customer satisfaction record with a strong customer base for choosing between brand or customer service.
The brand value is brought to the customer by good customer service relationships. The loyal customers may preview the brand as well as the products on the websites and the testimonials and depend on the customer service back to the public. The value or emotion, which a customer feels and relays back through the testimonials and the product reviews, cements the brand in the hearts of the customers or the prospective customers who are looking for purchasing the product.
Ideal customer service will help organizations increase repeated customer purchases from the loyal customers. Great customer service will be reflected in product reviews that are based on brand purchase. Various Customer service representatives deal with customer queries, concerns and product shipping as well as handling. They are the voice of business and they need to be professional experts in their respective fields
Building of brand value through customer service helps to build the trust with the customers. The different product reviews show that customers who have good and bitter experiences with a particular brand feel the need to talk about their experience. Building the brand value through customer service helps in building the trust with customers, which is the use of common courtesy with good business ethics (Ryder, 2005).
The potential customers may spend a great deal of time reading the reviews about the customer reviews on a product .If a firm has products which obtain good reviews, the value of the brand will be increased its value in the eyes of present and potential consumers. Good product reviews are similar to product testimonials, which will bring in more customers for business. The businesses who are building the brand value through customer service are effectively marketing their brands. Thus, it can be seen that brand value can be established only through better customer service and customers give top priority to customer service.
. Customer service representatives understand the customer’s frequent queues about products and services and also the most common complaints. This will help to give the business a chance for building the brand value through customer service by improving upon its product lines. By constant contact with their customer, service representative organizations will cut down their unproductive range of products, which will inevitably help to build brand value (Sparrow &Cooper, 1998).
Customer service executives should be constantly in touch with the customers through emails and newsletters. This proves to be an ideal way for building the brand value through customer service, which is to use follow-ups, which expresses customer appreciation. Customers can be given incentives, which will make them feel valued as well as appreciated. The existing customers who are not happy with their purchase trust the organization, its products and its customer service representatives’ ability to resolving the issues. The goal of an effective customer service department is to building the brand value and to keeping a loyal customer base. Building of brand value through customer service and better quality takes time and energy, which should be focused on the customer needs and wants from the brand which they are purchasing or have purchased from in the past (Rosenthal, 2007).
One of the biggest challenges for the customers is the lack of awareness about luxury brands. In addition, usually consumers identify mid tier brands as the top brands. Deep shift in the value and consciousness of consumers have created great commercial opportunities for the brands, which can recognize and exploit them (Yip, 1989).
3. From Bread to Designer cars
In the earlier years, luxury products used to be a privilege to possess. Luxury was related to products, which were considered rare, and scarce that were presented to minority group of consumers. Industrial Revolution brought in more wealth, which made the luxury products more affordable for all consumers and hence increased the purchasing power of consumers. Increase in luxury purchase has been influenced by social and business factor. The different varieties of products include automobiles, foods, jeweler, fashion, and accessories where cars and homes are some of the emerging luxury features. People tend to pay more for branded products than they are for something, which is usually unbranded. Consumer’s purchasing power usually depends on their income. More materialistic consumers tend to use more of luxury products. Materialism can be defined in relation to the consumer value, which consists of the achievement, which results in happiness through possession and success. Consumers who purchase for status has only desire for products that are in the requirements for status purpose. Consumers who are materialist possess products, which are important to their well-being (Pearce & Ravlin, 1987).
Consumer’s stress on items, which can enhance the status levels, in which they would associate to the status of quality products. Possessions are usually related to the materialistic consumers more adequately than the status consumers. One of the most concerning issue is that this portion of market has been focusing on the generation Y as there has been change in the disposable income towards spending on luxury brand. The wealthier group of consumers is between the age of 19 to 25 years of age who are working and these young consumers are familiar with credit cards and technology. The accessibility of credit cards has contributed to the trading up and overspending (Moncrieff, 2006).
Marketers influence the consumer behavior through the knowledge of fashion. The valuation of technology has affected the viewers in relation to materialism among youngsters s, and the duration of viewing TV, programmes extend up to seven hours a day. People are influenced by television, as more viewers watch television it is more likely that they may reflect their perceptions in “reality” as they have seen in television world. What is shown on the television in association to the characters and he materials represent the affluent group of individuals. Consumers understand the meaning of luxury goods differently depending on the socio economic background (Moncrieff, 2006).
Functional demand can be called as the demand for commodities, which is due to the inherent qualities in the commodities itself. On functional demand comes from the factors other than the product quality. Based on Veblen effect, there is conspicuous consumption for luxury goods where consumers feel that it is required for the purchase of luxury products as they have high price tags. According to Snob effect Snob consumers only buy the limited number of items which have high value where as those readily available are desirable. Rare items demand for respect and prestige. The bandwagon effects represent the consumers who purchase luxury products since they wish for fitting in particular groups. Bandwagon consumers purchase items to be fit in with others, whereas snob consumers buy items to be unique and standing out. Culture is one of the main factors that affect consumers in the decision making process. The Eastern Culture focuses on visible possessions. This exhibits the economic status that is often used as a main social concern in industrialized societies as a communication factor for achievement. Hence Asians may focus more on visible possessions such as designer labels, expensive cars, jewellery items, etc (Douglas & Craig, 1999).
Consumers should be able to identify, add the information that belongs to one brand what they read and see, and know what they will receive as benefit. From a specific brand, and should be able to whittle down the variety of choices to that which they can hold in the minds of the consumers. In order to do these organizations should be more thoughtful about how the brand is to managed and the message is communicated by the entire Value web to the consumers who are current and potential.
4. Branding a Global Phenomenon
The world today is of shrinking boundaries and more of shifting economic fortunes. Certain brands are associated with their country of origin. Brands have now become ubiquitous in global culture. Today brands have become an integral part of the culture and economic landscape and there is a growing need for the international marketing scholars not only for adapting to changing global market conditions but also for contributing to the public discourse on the practice of branding (Douglas & Craig, 1999). Brands have been in existence since ancient items the first unrecorded brand strategy can say when potter had put and imprint of his thumb on a wet clay of bowl. Branding has been a practice of identifying goods with the artisan who created them age the early consumers a means for distinguishing goods from one maker to those of another. The rise of merchants, brokers or resellers added to the dimensions of the concept of the brand/. The development of brands and the separation of maker, sellers, users etc now distinguish the modern market place. Brands have been historically within the purview of the manufacturers, all levels of distributors, intellectual property holders, and organisations, all are trying to apply the branding principle to distinguish them elf from their competitors. Branding has now become the main focal point o competition and the one area where the organisation can still achieve meaningful and sustainable differentiation among the target customers as well as the prospects.
With globalisation, the markets as well as competition have compelled the larger scale companies to expand their geographic scope of operations. The development of international retailing and the movement tiff people goods as well as organizations across the international borders are getting integrated. Branding policy is a firm’s international marketing strategy. Strong brands helps in establishing the firms’ identity in the global market place, and to develop a solid customer franchise (Markides & Constantinos, 2005).
The central role of branding means developing explicit international brand architecture. There should be the different levels of branding within the firm, the number of brands at each level as well as the geographic and product market. The most critical element here in this structure is the different number of levels, which are corporate, house/product business and product and how these are used in conjunction with each other. The challenge is the management of the brands spanning different geographic markets and product lines. The drivers of an international branding strategy are firm based characteristics, product market characteristics, and d the market dynamics.
As brands go forward, they will find that meaning is more critical than processes for success. However, the focus of the organization would be on emerging markets, which is mainly economic, these very markets are more exposed to resource shortages, pollution, and other threats to their viability (Hamel & Prahalad, 2008).
Today consumers in different markets are connected through the digital networks and social media, any inconsistency shall be identified quickly, shared and can be publicized. Hence, the Global brands may need to speak coherently across the markets. Global brands may base on values and meaning, putting more pressure on the ways in which corporate culture is created, communicated and internalized. Today the challenge is intensified by the status, which is enjoyed by many foreign brands among the emerging market consumers. As the developing nations grow more prosperous, the consumers may increase the spending on established brands. Uncertainty is bringing together a confluence of perspectives that is redefining global brands from the bottom up. The hierarchy of established global brands will be challenged by new, co-created global brands.
Established brand owners have the skills and experiences for navigating through tricky marketing waters, and they should feel confident about their ability in the creation of new authentic new brands of their own.
5. Conclusion
Once a brand identity has been accepted, it starts taking on different values that are established by the people who use the brand. The main three key aspects contributing to the assessment for global brands are the financial performance, the role of branding in the purchasing decision process and the strength of the brand.This will be enhanced or exaggerated by people, who sell the brand, by people who recognize that certain sales features do have a ‘consumer’ appeal. Evolution of the brand from one form of products into another, where the brand itself takes on new values, which has been promoted by the organizations by their marketing, advertising and promotional activities and either accepted or rejected by consumers. A brand that has been accepted by consumers and promoted by manufacturers in one market does not mean that the brand values can be transferred to any or all products manufactured by the producer. Organizations, which include many government departments, have been looking at their brands essentially as a passport for enabling them to market their new products using their existing known brands as for gaining the attention, and attracting the immediate values to new products. The ideal form of advertising is a word of mouth recommendation from one friend to another. Here the brand will immediately take on positive brand values in the mind of friends.
Companies may use free samples ,as shopper, bonuses, as demonstration products, as sachets of free products in magazines, as gift attachments to another sale item to get people to ‘try’ the product. The companies hope that this sampling will lead to the doctors prescribing the sampled products to their patients. The purchase intent of the brand will very quickly be established through such means. If we throw in the ‘prices’, this can either reconfirm the intended purchasing behavior, or change it completely.
Customer loyalty is can be called as a function of switching the costs, differentiation, and preference of a particular brand. Branding takes, the main benefits of a product and extends them to a higher value source through the accretion of intangible benefit such as lower perceived risk and added emotional benefits. These additional benefits help the brand to earn a higher degree of differentiation. The differentiated brands lead to lesser customer churn. Absolute controls over a brand is not possible because of the outside influences and in the different industry sectors, the aspects of branding shall differ, but the basic principle of being clear as what you stand for always remains the same.
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