Branding ≠ Advertising. Make the most out of your efforts and resources with this return-driven concept!
foundations that help businesses effectively implement their branding and marketing strategies. We encourage you to read about RDS during your spare time. This framework offers lots of insights that will guide you towards business success! In today’s article, let’s focus on Tenet 6 of RDS, which is about branding offerings. Keep reading to know some factors that influence effective branding.
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Branding ≠ Advertising. Make the most out of your efforts and resources with this return-driven concept! Are you familiar with umbrella branding? This is a marketing practice involving the use of a single brand name for the sale of 2 or more related products or sub-brands, and is mainly used by companies with a positive brand equity. An example of this is the Marriott Hotel brand…
The Marriott Hotel is a multinational company that operates, franchises, and licenses lodging including hotel, residential, and timeshare properties. Headquartered in Bethesda, Maryland, the company was founded by husband-and-wife duo J. Willard Marriott and Alice Marriott in 1927. Marriott is the largest hotel chain in the world in terms of number of available rooms. It owns 30 brands with 8,000 properties in 131 countries and territories. The company also operates 20 hotel reservation centers. Today, Marriott sits behind the Fairfield Inn & Suites, Courtyard, Residence Inn, TownePlace Suites, SpringHill Suites, and many other hotel brands. Clearly, the umbrella brand communicates something about its hotels. … and what is that? While each brand is different, they still share the same traits in terms of cleanliness, reservation policies, frequent stay programs, etc. Through advertising, Marriott—alongside its individual brands—is able to deliver an important message to customers about its offerings. Here’s the thing: For some businesses, the purpose of branding is often confused with advertising. According to Professor Joel Litman and Dr. Mark L. Frigo in the book, “Driven,” branding is NOT advertising. Advertising is a tool for branding, but only one of many, and should never be confused with the process of branding itself. In a past “Return Driven Strategy” article, we talked about “The 22 Immutable Laws of Branding” by father-and-daughter duo Al Ries and Laura Ries who believe some firms tend to over-depend on advertising when building a brand. However, the Rieses say great brands are built not through advertising but through public relations (PR). This concept is consistent with Professor Litman and Dr. Frigo’s Return Driven Strategy (RDS). Sure, advertising is a TOOL to keep the brand healthy, and create brand awareness and recognition. The problem? The role of advertising can distract firms from the REAL goal of branding, which is to convince customers that their unmet needs can be uniquely fulfilled by a particular offering. Think about this: Awareness or recognition of a brand is useless if customers do not buy your product or service. No matter how much you spend on ads, if consumers don’t buy your offering, all your efforts are a waste of resources. In Professor Litman and Dr. Frigo’s words: “Without purchase, branding efforts cannot be considered worthwhile.” So, if we are to think of this in the lens of the Marriott Hotel umbrella branding, it means regardless of how much the company’s sub-brands put Marriott’s logo in their names, their advertising efforts will be useless without proper understanding of branding. Sure, adding Marriott’s logo to their names will help increase awareness and recognition of their brands, but there’s nothing about it that will push customers to make a transaction. There has to be other activities to further facilitate the branding process and convince people to actually engage with these hotels. What else influences branding aside from advertising? Professor Litman and Dr. Frigo say every customer touchpoint is a branding opportunity because it’s an avenue to influence their minds. As we explained in past “Return Driven Strategy” articles about RDS’ Tenet 6, branding is a psychological bridge—meaning, it occurs through customers’ thoughts and feelings regarding an offering and their unmet need. In other words, the ideas surrounding a particular product or service are affected by customers’ interactions with anything that affects that psychological bridge. Below are other types of communications that affect branding:
Branding and Cash Flows Go Hand in Hand According to Professor Litman and Dr. Frigo, the value of a brand cannot be separated from the cash flows of the offering with which it is associated. For example: One cannot say that the value of the Marriott Hotel brand is high and yet its sales are not. These two should always be parallel to each other. Even if a company were to purchase the licensing of a specific name, without an offering to attach the name to and a need that the offering fulfills, the brand remains worthless. Always keep in mind: It’s not enough that many consumers remember a brand’s name vividly. Without innovation of a deliverable offering that fulfills unmet needs, brands are worth insignificantly less, if anything at all. If you're looking to gain a better understanding of branding and Return Driven Strategy, we highly recommend checking out "Driven" by Professor Litman and Dr. Frigo. Click here to get your copy and learn how proper branding can build an indelible connection in the minds of customers between their explicitly understood need and the offering that uniquely fulfills that need. Hope you found this week’s insights interesting and helpful. Stay tuned for next Tuesday’s Return Driven Strategy! CD Projekt, known for its critically-acclaimed “The Witcher” video game series and “Cyberpunk 2077,” is one of the most recognizable names in gaming today. Gamers across the world have spent thousands of hours playing the aforementioned titles. Learn more about this business case study in next week’s article! |
