Misunderstanding the nature of product management is the root of subsequent misunderstanding about brand management.
To understand this important topic, we should start by defining a product. A product in simple terms is something that solves a problem.
When a customer purchases a ¾ inch drill bit, it is not the bit that they are after, but rather the hole that it creates.
When a company fails to think of its business in terms of the benefits or value it provides to the customer it is in danger of losing its competitive position in the market place.
Unless a company defines its products in terms of benefits or value provided, any hope for successful branding will not be fulfilled.
It’s sad that with over fifty years of education and advancement in the marketing industry, ignorance is still rampant concerning what exactly marketing is. Following are some of the major areas of confusion:
- Confusion about product management
- The belief that a good product will cause success. There are thousands of quality innovative products that have seen their owners go bankrupt (think Kodak, Blockbuster, Remington Typewriter).
- Confusion with and about advertising
- Throwing huge sums of money at advertising while failing to deliver on the basic promise of that advertising is still a popular way of tackling deep-rooted problems.
- Confusion with customer service
- Spending huge sums of money training the staff to charm the customers, while getting the basics fundamentally wrong. It is nice to be treated courteously, but in the end, it is actually important that the meal be delivered hot and delicious.
- Confusion about the sales process
- Selling should be the culmination of all of the above. A great product at a fair price that solves a problem, coupled with great customer service and great advertising and marketing.
When we refer to a “Brand” we use it to encompass not only consumer goods, buy a whole host of offerings. Second, a distinction should be drawn between a “brand” and a “commodity”.
A commodity can be characterized as a lack of differentiation. In situations such as this, one finds that purchase decisions tend to be taken on the basis of price, and not the brand.
The difference between a brand and a commodity can be summed up in the phrase “added values”. A brand is more than just the sum of its parts. It embodies additional attributes which, while they might be considered by some to be “intangible” are still very real.
Often these added values are emotional values which the customer finds difficult to articulate. These added values result from well thought through marketing strategies which develop a distinctive position of the brand in the customer’s mind.
The more distinctive and favorable attributes that a product contains and that the customer considers important, the less likelihood that a customer will accept a substitute.
Strong successful brands enable organizations to build stable, long-term demand and enable them to build and hold better margins than either commodities or unsuccessful brands. Successful brand building helps profitability by adding value that entices customers to repeat their purchase over time.