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  • Victor Montalvo

What Is Branding and Why Is It Important for Your Business?

Updated: Jul 28, 2022

What Is Branding and Why Is It Important for Your Business?

When it comes to marketing, one of your most important assets is branding. Brands are a company's way of advertising what they sell and how good that product or service might be for you - which means that in order make their presence known on as much turf possible (online), companies will have gone above-and-beyond with things such as social media platforms like Twitter where messages can spread quickly across large audiences.

Companies have been branding themselves for centuries, but the idea that all you need is an attractive logo and good design may not be true anymore. With so much change in marketing over these last few years—especially with digital tools like social media making it easier than ever before to reach your target audience-- brands now carry more weight than ever before when deciding which company will best suit someone's needs.

- Seth Godin

Your brand is more than just a logo on something you sell, it's what makes the difference between success and failure. Your customers will be able to tell that YOU are different from any other company they come across by looking at your branding techniques which enables them in their purchasing decisions because of knowing exactly where each product came form or who was behind its creation!

A brand is the result of many different elements working together in order to create one memorable and unique profile. Advertising, customer service, social responsibility; all these things play their part in shaping your reputation as well.


If branding were as simple to understand, there would not be so much confusion about what it is. Still for most people a strong understanding of branding requires knowledge in business and marketing along with the basic’s human relationships; this vast concept can't really be encompassed by one definition alone without losing potency or meaning entirely. But, for the sake of lowering the propagation of obsolete, incorrect, and incomplete information about branding, we offer a more complete definition: Branding is the process of identifying, creating and managing your company's assets in a way that shapes how people perceive you. Our definition of branding, even if seemingly more ambiguous than the other, gives much more sense to the concept when diving deeper into its meaning. Here is a rough breakdown:

1. Perpetual process

The need to stay ahead of the curve is constant in this industry. Branding must evolve with time, or risk being left behind as consumers change their preferences and businesses transform themselves over just one year's worth of changes.

2. Identify, create, manage

It’s amazing how much thought goes into branding, isn't it? There's a structured process to create your brand strategy and then constantly manage everything that influences where you rank among other companies.

3. Cumulative assets and actions

Positioning must be translated into assets (e.g., visual identity, content) and actions that project it into your stakeholders' minds gradually building up this perception over time.

4. Perception of a brand

Also known as brand equity, this is the value an individual has when they associate their thoughts of your company. It's in no way related to how well you do business with them or if that person likes what we make but rather comes from perception and branding efforts like those which don't exist at all for some people who may have had bad experiences before.

5. Stakeholders

The people who interact with your business are just as influential in shaping how you're perceived. Stakeholders include possible future clients, existing customers (and potential ones), employees and shareholders - not to mention any other partners or contractors involved throughout the process.

Why is branding important?

The power of branding is undeniable. It can change how people perceive your company, drive new business, and increase overall brand value - but it could also do the opposite if done wrongly or not at all. Let’s be clear: Your reputation builds up whether or not you do something about it. The outcome can either be a good one, but also bad if left unattended for too long with no changes made in the meantime; understanding and using branding isn't just about taking control over what that looks like? It should start from day 1 of any business venture because without doing anything at all (unless things change drastically), those around us may form opinions based on old information which could lead to an undesired result. Although the perception of branding is that it's only for big brands, in reality, any company or individual can benefit from a clear brand. Branding has everything to do with common sense and changes depending on your market position as well as how far up you want play at. There are many competencies involved when developing one, but cost will vary based off those choices; don't worry though because if something isn’t working than there's no shame telling them what needs changing.

It's important to note that high-level consultants and flawless implementation will always be more expensive than anything below it. Likewise, branding a multinational business can take much longer because of its complexity; however, there is no one size fits all approach when doing so.

Branding increases business value

The value of your company and future prospects can be greatly enhanced by branding. Brand recognition in this industry is vital for generating business, so establishing a strong brand will help you get more leverage when negotiating prices with clients or finding new customers to work on projects too. The result of the branding process is a strong, valuable brand that can have influence or price premium depending on what it represents. The value in itself may also lead to mindshare for your business since people are more likely buy from companies with good reputations because these brands stand for something authentic and worth paying an extra amount for.

Branding generates new customers

A great brand will have no trouble drumming up referral business. Strong branding generally means there is a positive impression of the company amongst consumers, and they are likely to do business with you because of their familiarity or assumed dependability in using your name for trustworthiness. Once an established brand has been well-known through word-of-mouth advertising alone.

If a company has an established reputation of being trustworthy, then word-of-mouth will pass on that trustworthiness and potential new customers may have already formulated in their mind to make them more likely to purchase from this brand rather than its competition.

Improves employee pride and satisfaction

Working for a company that you believe in is an important part of your job satisfaction. When employees work for brands with strong reputations and stand behind their products, they will feel more valued as workers which translates into higher levels of pride when doing what's considered 'boring' tasks like filing paperwork every day at an accounting firm or data entry after hours without any excitement whatsoever.

Employees are the first line of communication for any brand and should be treated as such. They have a major role in perpetuating their employer's perception with clients, partners they come into contact with on-the-job or off it too; this can result not only good leadership but also better products/services because the employees will feel more invested themselves through human interaction rather than marketing tactics alone.

Creates trust within the marketplace

90% of a brand's reputation boils down to how much trust clients have in it. The stronger the client’s perception, the better their opinion on your products or services - and thus you can be sure that these will also reflect positively toward yourself as well.

Branding is about building a relationship with your customers. Branders want to earn trust and be seen as reliable, so they establish realistic promises that position the brand in its market space while also delivering on these commitments for it to gain momentum–think of how an entrepreneur might build their clientele if each customer feels like they have been taken care of right away.

Branding in practice

Branding is not a one-pager. It's an ever-evolving subject spanning many areas of expertise: business management, marketing, and advertising to name just some - with branding itself being at the center producing meaning for all these different functions through its various layers. There are many different aspects to branding, but it's important for you not only understand the basic concepts behind them. It will help if your knowledge extends beyond just what is written in this article or any other book on marketing theory.

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