Importance of Branding Decision

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The first decision is whether the company should develop a brand name for its product. In the past, most products went unbranded. Producers and intermediaries sold their good out of barrels, bins, and cases without any supplier identification. Today, branding is such a strong force that hardly anything goes unbranded.

There is three brand decision :
1. Brand-Sponsor Decision
2. Brand-Name Decision
3. Brand-Strategy Decision

1. To Brand or Not to Brand

The first and foremost decision is whether a manufacturer wants to brand his product or not. For his, he considers the positive and negative aspect of it. If he wants to brand his product then the other branding decision arises.

2. Brand-Sponsor Decision

A manufacturer has several options with respect to brand sponsorship. The product may be launched as a manufacturer brand (sometimes called a national brand) a distributor brand ( also called reseller, store, house or private or brand). or a licensed brand name. Another alternative is for the manufacturer brand dominate, large retailers and wholesalers have been developing their own brands by contracting production from willing manufacturers.

3. Brand-Sponsor Decision

Manufacturer and service companies who brand their product must choose which brand name to use:

Four Strategies are available :

1. Individual Names

A major advantage of an individual names strategy is that the company does not ties its reputation to the product’s fail or appears to have low quality, the company’s name or image is not hurt. 

2. Blanket Family Names

The policy is followed by Heinz and General Electric. A blanket family included less development cost because there is no need for “name” research or heavy advertising expenditure to create brand name recognition.

3. Separate Family names for all Products

Where a company produces quite different products, it is not desirable to use one blanket family name. Companies often invent different family names for different quality lines within the same product class. Thus A and P food stores sold the first grade, second grade, and a grade set of brands.

4. Company Trade Name Combined with Individual Product Names

The Policy is followed by Kellogg. Some manufacturer ties their company name to an individualizes the new product. The company name legitimizes, and the individual name individualizes the new product. Once a company decides on its brand name strategy, it faces the task of choosing. 

4. Brand Strategy Decision 

A company has five choices when it comes to brand strategy the company can introduce : 

  • Line Extensions: Existing brand name extended to new sizes or flavors in the existing product category.

  • Brand Extensions: Brand names extended to new product categories.

  • Multi-brands: New brand name introduced in the same product category.

  • New Brands: New brand name for a new category product.

  • Co-Brands: Brands bearing two or more well-known brand names.

5. Brand-Repositioning Decision 

A company has to take the decision about whether it needs to reposition in the market or not.
The branding decision can be summarised as follows: