BRANDS

BRANDS

brand is an identifying symbol, mark, logo, name, word and/or sentence that companies use to distinguish their product from others. A combination of one or more of those elements can be utilized to create a brand identity. Legal protection given to a brand name is called a trademark.

BREAKING DOWN 'Brand'

A brand is seen as one of a company's most valuable assets. It represents the face of the company, the recognizable logo, slogan or mark that the public associates with the company. In fact, the company is often referred to by its brand, and they become one and the same. A company's brand carries with it a monetary value in the stock market (if the company is public), which affects stockholder value as it rises and falls. For these reasons, it's important to uphold the integrity of the brand.

What is 'Brand Equity'

Brand equity refers to a value premium that a company generates from a product with a recognizable name when compared to a generic equivalent. Companies can create brand equity for their products by making them memorable, easily recognizable, and superior in quality and reliability. Mass marketing campaigns also help to create brand equity.

Brand Equity Example

A general example of a situation where brand equity is important is when a company wants to expand its product line. If the brand's equity is positive, the company can increase the likelihood that customers might buy its new product by associating the new product with an existing, successful brand. For example, if Campbell's releases a new soup, the company is likely to keep it under the same brand name rather than inventing a new brand. The positive associations customers already have with Campbell's make the new product more enticing than if the soup has an unfamiliar brand name.

Tracking a Company's Success with Brand Equity

Brand equity is a major indicator of company strength and performance, specifically in the public markets. Often, companies in the same industry or sector compete on brand equity. For example, an EquiTrend survey conducted on July 14, 2016, found that The Home Depot was the No. 1 hardware company in terms of brand equity. Lowe's Companies, Inc. came in second, with The Ace Hardware Corporation scoring below average. A large component of brand equity in the hardware environment is consumer perception of the strength of a company's e-commerce business. The Home Depot is an industry leader in this category. It was also found that, besides e-commerce, The Home Depot has the highest familiarity among consumers, allowing it to further penetrate the industry and increase its brand equity.

BRANDS CLIP

Logo

A logo is a graphic mark, emblem, symbol or stylized name used to identify a company, organization, product or brand. It may take the form of an abstract or figurative design, or a stylized version of the company’s name, as in a wordmark. A logo may also be used as a substitute for a company's name, if it has sufficient brand recognition

Logos have been around for thousands of years. The earliest logos were nothing more than a simple distinctive mark, symbol or literal brand to signify the maker of a product, or communicate what a merchant was selling. For example, in 1266, England’s parliament passed legislation requiring that all bakers use a distinctive mark for the bread they sold.

The modern logo began its evolution following the introduction of trademark laws in the 19^th Century. Jack Daniels’ iconic logo dates back to 1875, shortly after Congress passed the US Trademark Act of 1870 — an attempt to establish a Federal trademark regime which was rejected by the Supreme Court. In 1876, the Bass Brewery’s famous red triangle became the first trademark to be registered in the UK, after the Merchandise Marks Act was passed in 1862.

As the Victorian era progressed and the first brands were established, these trademarks became more complex, and evolved into logos as graphic design emerged as an art form. Modern-day logos have shifted from complexity back to simplicity, in order to stand out in a world of visual overload, and make them more easily recognizable across multiple media.

Trademarks and Patents

To register a patent in the United States, a business must submit a patent application to the Patent Office, which will be reviewed by an attorney to determine that the patent has been registered in accordance with federal regulations and that it is a distinct product and does not infringe on the trademark rights of an existing patent. After the application has been reviewed, the patent is "published for opposition" for 30 days, during which time other companies can oppose the registration of the new patent.

Trademarks can be bought and sold. Famously, Nike purchased the instantly recognizable Swoosh logo for only $35. Trademarks can also be licensed to other companies for an agreed-upon period of time or under certain conditions, which can result in crossover brands. Lego, a distinct company, has licensed many famous brands like Star Wars and DC Comics to produce Lego versions of popular products. These are also examples of the importance of branding products from a marketing perspective. Trademarks help distinguish products not only within the legal system, but to the consumer.