The Development Of Commerce And Brands
Commerce is a term used for the process of buying and selling goods and services between businesses or entities. However, buying and selling have become merely just one aspect of commerce since various other dimensions have come to light in the past century. Numerous companies which were product-centric and blabbered about its product features have either changed the way they talk about their product or vanished from the market because the consumers couldn’t find value in those products. The definition of products or services is that “they are the problem solver” which intend to solve a consumer’s problem and aids in achieving organizational objectives.
The birth of brands goes centuries back during the Greek and Roman times when shopkeepers hung indicative pictures above their shop to tell customers about what they sell and lure them to their shops and this was the first use of the brand logo (Chernatony & and Others, 2011). This was probably the primitive way of branding but as evolution continued the use of brands also evolved and today brands are considered to be one of the most influential tools to stimulate consumer behavior. The reason for this has been stated by Chernatony.L “we have moved from the industrial age, which stressed tangible assets, to the experience age where intangibles such as ideas, knowledge, and information are combined with brand interactions to deliver welcome experiences” (Chernatony, 2010,).
To illustrate with an example, in October 2012, Redbull, world’s biggest energy drink company, did live streaming on Youtube with skydiver named Felix Baumgartner from Austria who partnered with Red Bull to set the world record for highest skydive. That record: 128,000 feet, about 24 miles above Earth's surface. Not only did the company got a record on its name but also highest viewing traffic of any live stream ever broadcasted on YouTube at just over 8 million viewers. With this marketing, Redbull not only engaged its audience with the brand but also reiterated its positioning as an extreme sports drinks for men and its tagline ‘Redbull gives you wings’.
A similar brand positioning has been seen in India by an Indian origin cola brand called Thums Up which was later acquired by Coca-Cola Company. It also identifies itself as a drink for the braves and the ones interested in wild sports activities with its tagline ‘Taste The Thunder. Teens and young adults are the prime target customer for Thums-Up. Thums Up has been the premier brand under the Coca-Cola portfolio in India in terms of marketing budget with biggest film actors as its brand ambassadors. With 42% cola market share and 15% of the carbonated drinks market, Thumps Up is the leading cola brand in India.
Companies position their brands to stand out from hundreds of other brands out there in the market. It allows the consumer to differentiate one brand from another and select a brand which suits his preferences or requirements. Seldom, customers may interpret a brand differently from that intended by the organisation. Thus, some managers interpret a brand as a device that enables them to establish a key functional association in the customer’s mind. However, companies need to keep adapting the needs and preferences of the consumer which keep changing over a period of time. The change in preference could be because of multiple reasons but to cater the needs of their customer and come up with a new product is the key to keep the brand alive and running in the market.
One such instance of adapting the changing preference is Colgate Herbal in India. Colgate lost its market share by 1.8% to Indian rival Patanjali’s Dant Kanti which is an all-natural toothpaste and its sales dropped by 4% in fiscal year 2016 due to consumers inclination towards ayurvedic and herbal toothpaste. Patanjali is a company led by Baba Ramdev, a popular yoga guru in India, who promotes herbal and ayurvedic products. However, Indian consumers associated themselves more with Patanjali because their marketing revolved around its Indian origin, all-natural ingredients and Indian money not being drained out of the economy by a foreign company. This time the reason for the consumer to switch product was not just product features or the brand but far more patriotic and nationalist. Nonetheless, Colgate still is the leader in the market share of toothpaste with 55.6% as of 2016 but the disruption in the market by Patanjali, dropping sales and market share compelled Colgate to come up with a new product which catered to the changing needs of its consumer, Colgate Herbal, it propelled on its natural ingredients combined with oral science for healthy teeth and gums.
Today branding has become inseparable from overall business strategy. Effective branding has a foundation of strong message about the product or the service which gets translated and applied so that consumers enjoy consistent experience. It is through this consistent experience that consumers build up knowledge and form perceptions. Shortly after that, they become word of mouth publicity matter or talk points. The brand is driven throughout this whole process. However, the question that arises is what good is branding if it already exists in the minds of the consumer and delivered by the business? A brand can put some of the elements in place that will help people understand why they should choose or prefer a particular good, service, organization, or idea over another. Branding, and the related marketing disciplines can help influence and explain how many of these associations in our minds have been built.
A product or a service entering a market without a brand will face hurdles of registering itself with the consumer even with good quality but on the other hand, a product or a service with branding and decent positioning will create the greater impact on the minds of the consumers. A product is just the outcome of the production chain, whereas, embedding a brand on it gives a completely different perspective and more than one reason for the consumer to purchase it. A smartphone is just a smartphone until there is an Apple logo on it for it to be an iPhone.
