During my studies in the UK, there were few Professors who I immensely liked. One of them was our Marketing Professor, Dr. Malcolm who taught us basic concepts of Marketing so well that they are engraved in my mind forever.
The First Principle of Marketing, he said, was: “Demand = Needs + Wants.“
Needs are necessities, wants are desires. You cannot live without needs. You can easily live without wants. But they are aspirational. Most of the money is made in wants. As a Marketeer, your job is to turn Wants into Needs. Then selling becomes very easy. For example, Smart Phone was not a Need. Feature phone would serve the basic necessity of communication. But now Smart Phone is a Need. Not a want.
One of the important way of achieving this transformation is by building Brands.
What is a Brand? In Accounting terms, it’s intangible. It’s the excess of purchase price over the Fair price of the asset. But that’s too bland and technical. Marketing person would tell you the same with flair! He would say – “A brand is a Promise. A commitment”.
Promise or commitment could be about various attributes of the product. It could be quality, reliability, performance, design/aesthetics, persona (again, a vague concept sold by Marketing geniuses – as if Brand is a person and you, as a customer can relate with that person as your own self) etc. This promise or commitment is reinforced on the back of “proof” – which is Experience or Performance of the product or a service.
Price, delivery channel, packaging, mode of financing, paying – cannot be part of Brand. For example, a Brand cannot be built as “Affordable” or “Expensive”. Positioning of the product or service is based on the previously mentioned parameters which constitute a brand.
I don’t own or drive car. And I am not fan of cars. But one example shared by Prof which I remember is about Mercedes Benz and BMW. He asked what comes to your mind when you hear or see these names?
Then he explained that “Mercedes is a car you want to be driven in.”. You would imagine yourself as getting our of back-seat of a chauffeur driven Mercedes Benz. On the other hand, “You would want to cruise through in a BMW”. Their tag line is “The ultimate driving machine”. So you would be in the driving seat.
That’s brand and that’s positioning of the brand. Mercedes is for someone mature, who has earned his wealth and is now living a rich life. BMW is for youth and who want to control their life (and car).
Well, the examples could be debatable. The point was to convey that a brand can or should have a persona and it should evoke some sentiments and clearly convey the promise or commitment.
An important part of building brand is through advertisement. More about this aspect in the next post. I thought of this while reading a recent blog by Ramana Sir. So let me write about it in a separate blog post…