Why do people choose a specific brand of beer when they know all of them are basically the same product? No, wait a minute, let’s talk about this.

You have 2 TVs, almost identical. One, however, has the LG logo on it while the other one you can’t recognize. The price of the LG TV is 100$ higher than the other one. That’s branding. So what gives? This might seem shallow at first glance, but as we dwell deeper into branding you will understand perfectly well why the LG TV is so much more expensive.

What is Branding? 

Starting from the basics, what is branding? As defined by the Cambridge dictionary branding is: “the act of giving a company a particular design or symbol in order to advertise its products and services”. So from this, we can determine that a brand has its own unique aspect which sets it aside from its competitors. But this doesn’t answer the question of why does putting a 3$ logo on something make it skyrocket in price. Well, this is the problem, most people reduce branding to just a visual aspect. When in reality, it is so much more.

A Symbol of Trust

The approach shouldn’t be: “The brand defines the product” but “the product defines the brand”. In order to have a successful brand you have to have a commendable reputation, the product you are selling must be widely deemed as worthy so that your brand name can become a household name. If generations have enjoyed your product (mostly) to their satisfaction then people will immediately make good correlations when they spot your logo/symbol. The price increase isn’t because of the logo per se, it’s because of what that logo means and what it portrays.

When you buy a product from a brand you deemed to be worthy, you carry a degree of trust in the brand. You are convinced that it is of better quality than the other product (of whom you know almost nothing about). You are willing to go that extra mile in exchange for security. However, this does not mean that branding can’t be a manipulator.

The Brand Paradox

A study was conducted in the UK where customers were asked to participate in blind taste testing. The beans being tested were from Heinz and one of their competitors. About two-thirds of the taste testers said they preferred the taste of the other brand and not those of Heinz. But as soon as the brands were revealed, a large number of taste testers swapped their vote to the Heinz beans. The very name of the brand Heinz has such deep roots in people’s minds that it systematically corrects your judgment subconsciously on what product you prefer. This can lead to a losing race where certain competitors will never reach their rivals purely because of their opponent’s strength of branding. In a more personal example, I personally can’t taste the difference between a 10$ wine and a 100$ wine, but once I see the price, I immediately think more expensive → better. 

What Makes a Brand Great? 

Surely, the M sign for McDonald’s doesn’t involve a terribly complicated process to make it? Wrong. Making a successful and recognizable brand name isn’t just sticking a random letter or fruit and calling it ingenious. A lot of time and effort is spent in creating the brand you see today, heck, most of the time it changes throughout history. Just look at the logo chronology of Nike. Corporations are constantly experimenting and trying out new ideas. In making a good brand simplicity is key. You want it to be recognizable at first glance but also appealing to look at. 

This brings us to the other criteria, colours. Colours play an important role when coming up with a brand style. It portrays what kinds of feelings or urges you want to stimulate. As was pointed out by Karen Haller, red and yellow are predominant colours in the fast-food industry because red is a colour that stimulates hunger, appetite, and screams attention as a colour. Yellow makes you feel welcomed and happy. With these colours together, they make for an incredibly suggestive combination, perfect for fast-food businesses. Words take longer to register. Signs, characters, and colours are instant. This is their nature and how they can be exploited. Meanwhile, the colour green has been gaining more and more attention in the last decades due to the rise of eco-friendly movements and overall positive association with the colour green with nature. 

Of course, this doesn’t mean that you can just make a logo following psychological tricks and whatnot and expect to become a billionaire. No, that doesn’t work like that. Having it be recognizable and eye-catching is only the foundation. The well-made logo will only attract attention, you have to make them stay with the quality of the goods/services that you provide. This also requires tremendous amounts of upkeep. If you have a physical location you must have it appear clean at all times to avoid negative association or even god-forbid question the seriousness of the business owner. When marketing the goods you will need to spend a good amount of money on high-quality services, it’s what separates small fries from big corporate names. There are immense differences between having high-quality custom banners for your goods and services and having low-quality ones just to save some money.

The Effects of Branding

As we have already mentioned, branding creates a feeling of trust between the customer and the provider. Leading them to believe your product is the best and safest they can find. They are a key aspect of creating future business, as an established brand increases the value of your goods and services, hence giving you leverage when competing in the open market. A strong brand not only increases the value of your products but will also cement itself into people’s minds. Leading to free peer-to-peer recommendations on what to buy, only creating further profit for you. And it can grow to the point where we showcased the Heinz beans example, where a brand can leave such a print in your brain that it will cause you to defy your senses. And the most interesting part is that a strong brand won’t just spam for a couple of years, it will be here throughout several generations (depending on how rooted in mainstream culture it becomes)

Branding is a fascinating process that is way deeper than people think at first, it does have some morally questionable parts depending on how you look at it, as it can be a source of manipulation. But as with anything in this world, it is not completely black or white. It is up to you to decide how you want to perceive branding.