What Is Brand Management?
Brand management is a function of marketing that uses techniques to increase the perceived value of a product line or brand over time. Effective brand management enables the price of products to go up and builds loyal customers through positive brand associations and images or a strong awareness of the brand.
- Brand management is a function of marketing that uses techniques to increase the perceived value of a product line or brand over time.
- Effective brand management helps a company build a loyal customer base and helps fuel a company’s profits.
- A brand manager ensures the innovation of a product or brand, creating brand awareness via the use of price, packaging, logo, associated colors, and lettering format.
- Brand equity refers to the value a company gains from its name recognition, enabling it to be the popular choice among consumers even when compared to a generic brand with a lower price point.
How Brand Management Works
Brands have a powerful influence on customer engagement, competition in the markets, and the management of a company. A strong brand presence in the market differentiates a company’s products from its competitors and creates brand affinity for a company’s products or services.
A brand that has been established has to continually maintain its brand image through brand management. Effective brand management increases brand awareness, measures and manages brand equity, drives initiatives that support a consistent brand message, identifies and accommodates new brand products, and effectively positions the brand in the market.
It takes years to establish a brand, but when it finally occurs, it has to still be maintained through innovation and creativity. Notable brands that have established themselves as leaders in their respective industries over the years include Coca-Cola, McDonald’s, Microsoft, IBM, Procter & Gamble, CNN, Disney, Nike, Ford, Lego, and Starbucks.
Examples of Brand Management
Seeing a gecko reminds one of GEICO Insurance which uses the reptile in most of its advertising campaigns. Similarly, the Coca-Cola jingle “It’s the Real Thing,” which first aired in 1971 as a TV commercial that featured people of different races and cultures, is still popular and familiar to generations of Coca-Cola consumers.
A brand does not have to be tied to one product. One brand could cover different products or services. Ford, for example, has multiple auto models under the Ford brand. Likewise, a brand name can take on multiple brands under its umbrella.
Requirements of a Brand Manager
A brand manager is tasked with managing the tangible and intangible properties of a brand. The tangible aspects of a company’s brand include the product’s price, packaging, logo, associated colors, and lettering format.
A brand manager’s role is to analyze how a brand is perceived in the market by taking the intangible elements of a brand into account. Intangible factors include the experience that the consumers have had with the brand and their emotional connection with the product or service. The intangible characteristics of a brand build brand equity.
Brand equity is the price above the product’s value that consumers are willing to pay to acquire the brand. Brand equity is an internally generated intangible asset in which its value is ultimately decided by consumers’ perception of the brand. If consumers are willing to pay more for a brand than a generic brand that performs the same functions, the brand equity will increase in value. On the other hand, the value of brand equity falls when consumers would rather purchase a similar product that costs less than the brand.
A cult brand is an example of a “benign cult” where the customer base for a product or service is extremely loyal, leading to the brand’s success as a growing legion of customers feel a unique emotional connection with the brand.
Brand management involves not only creating a brand but also understanding what products could fit under the brand of a company. A brand manager always has to keep its target market in mind when conceiving new products to take on the company’s brand or working with analysts to decide what companies to merge with or acquire.
The difference between brand management success and failure comes down to ongoing innovation. A brand manager that continuously seeks innovative ways to maintain the quality of a brand will retain its loyal consumers and gain more brand affinity, compared to one that is content with the current good name of the company’s brand.
Compete Risk Free with $100,000 in Virtual Cash
Put your trading skills to the test with our FREE Stock Simulator. Compete with thousands of Investopedia traders and trade your way to the top! Submit trades in a virtual environment before you start risking your own money. Practice trading strategies so that when you’re ready to enter the real market, you’ve had the practice you need. Try our Stock Simulator today >>« Back to Glossary Index