A corporate brand is an intangible asset so it is difficult to copy as it is not a product from a production line. Corporate brand represents a logo or a slogan that is protected by laws, which are in place. Slogans or logos are more secure then the product it self as it is easy to copy a product but it is nearly impossible to copy a logo. |
Corporate brand helps achieving the economies of scope, which means it is less costly for a firm to produce two separate products than for two specialized firms to produce them separately. For example Nike has a slogan of "Just Do It" across the globe and through its advertising Nike can promote its different products and services.
Due to advancement in technology and in communication world is becoming a small community. Consumers are more knowledgeable then ever. Globalisation is common between all the big organisations. Corporate brand is important for the globalise organisations to show that their core value is same wherever the product is.
Corporate branding is also very useful when organisations want to enter into a new market. This can be seen when Samsung entered into mobile communication market, Samsung did not have much experience in mobile market but their recent mobile model Samsung D500 has outclassed Nokia and Motorola's models. This is gain mainly through innovation but brand equity played its part as well. Samsung is brand which consumers can trust and is known for a time.
According to Balmer (2001) a corporate brand is seen as a rare entity due to brands unique pattern of development. Companies with corporate brands have competitive advantages over those that do not have corporate brand. The brand name, logo plays a vital role in awareness and it also provides the peace of mind to customers. Olins (2001) classed Manchester United and British Airways as organisations with corporate brands. Reason that these organisations have corporate brands is because that's how they presented their brands through marketing such as T.V advertising, Billboards and other marketing campaigns. These companies have spend millions of pounds on advertising to have a corporate brand, as organsiations with corporate brand believes that this will give them a competitive advantage. It can be stated by considering Olins statement that corporate brand is important for the organisations.
Davis suggests corporate brands are not required by some companies, for example those that may have a portfolio of brands such as Unilever and Proctor and Gamble, tends to use the branding of products rather than implementing a corporate brand. This issue of importance of having a corporate brand has not been taken by these major organisations in past for example surf is a product by Unilever. Unilever's general emphasis is on product branding as compare to one corporate brand. But the importance of a corporate brand has been explored on these big companies.
Balmer stated in his journal of general corporate branding management "Mighty proctor and gamble who traditionally espoused the idea that their brands should stand on their two own feet, have realised the importance of managing Proctor and Gamble as a brand. The company's chief executive decided that in the future the company would be presented as the ultimate corporate brand."
(Corporate branding and Connoisseurship by Balmer J.M.T Journal of management Vol 21 no 1 autumn 1995.)
From statements above it can be stated that corporate brand provides loyalty which means that consumers will only stick with one corporate brand and will not choose any other product. This can true in the case of products like Rolex or Mercedes but when it comes to ever day's essentials such as milk and bread corporate branding is in that important, as we will not travel an extra mile to get a Safeway milk. Many people will just go to a nearest corner shop or a service station to get a bottle of milk.
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