Brand Equity - Coca-Cola Brand - Article Example

Institution Affiliated The Study of Brand Equity: Coca-Cola Brand Student’s Name Professor Subject Abstract In modern times, having a strong brand is one of the core missions of national and multinational companies. Multinational corporations are competing globally to position and present their products to segmented markets through branding. Company's brand helps the customers to differentiate massive goods and services offered in the market by competing companies within an industry. Today, companies with strong brands are most successful than companies with weak brands. The primary purpose of this paper is to articulate the importance of having a strong brand within a company. For more understanding, the paper uses Coca-Cola brand as a case study. Additionally, the paper pools together various theoretical frameworks from secondary resources from different business scholars and economists. This article looks at the various theoretical frameworks explaining the importance of having a strong brand in the firm when positioning the products in various market segments. Introduction According to Rijal and Dhakal (2015) brand name is a unique presentation of the company's products using symbols such as logo, slogan, trademark and packages. The brand differentiates company's products from the rivals' products; companies competing within an industry. Unlike in the past, in modern times branding has become a priority at the market place to many companies. In study, Marks (2016) found that more than 90 percent of global consumers affiliate themselves to companies with strong brands and high reputation in global markets. In his research, Broyles et al. (2009) demonstrate that customers' perception towards company’s brand plays a vital role for it help customers to participate and differentiate products and services in the market. Hall et al. (2016) also found that brands have psychological effects to consumers such that consumers become dominants to specific brands in the market. Therefore, companies are becoming more responsive towards branding than before to cope with consumers’ changing behaviors. From this perspective, a brand is inseparable from clients’ and it is an important value asset that sustains company’s competitive advantage. According to East et al. (2013) strong brand has high brand equity in the market and the company with brand equity and reputation has high chances of serving dominating the market. Additionally, multinational corporations with vigorous and successful brands use their dominating brands to launch new products, for the consumer's attitude towards the brand remains confident. For instance, coca cola has been launching a series of products annually due to its brand reputation. Amulya (2016) suggests that a company with strong brand equity has high value in assets and customers' perception is also great. For instance, companies with high-quality products have the capacity to build their brands due to customers' perception and reactions towards the products. Therefore, the company's brand signals consumers concerning the name as well as the company itself. Most of the companies adapt their businesses' names as their brand, and hence, stimulating customers to purchase the branded products. Herbst and Merz (2011) state that building brand in modern times, it is difficult and it is a long process. However, building a strong brand is of great importance for the company will be able to develop goods that merge with customers' feelings and physiological needs. Moreover, unlike in the past three decades, modern consumers focus much on the quality of the products and goods’ level of satisfactions rather than the prices. This paper presents and develops different theoretical frameworks that bring an understanding of the importance of having a strong brand. The paper also examines the Coca-Cola brand architecture and its importance in international markets. The article also addresses the conceptual framework that identifies the key elements of a strong brand basing on the case study. The paper concludes with the writers’ recommendation concerning the roles and importance of a company having a strong brand. Company’s Overview Coca-cola is a multinational corporation and it is the largest soft drink manufacturer in the world. The company deals with nonalcoholic drinks with more than 600 outlets and more than 3000 beverage choices. However, the company only features only two products around the world: sprite and coca-cola (Santos and Cahyadi, 2014). The emergence of competitors within the industry has been stimulating Coca-Cola to develop and present the products in uniqueness. The company also uses customers purchasing behavior to formulate marketing strategies. The company has a series of brands designed to meet customers’ demands (Schmitt, 2010). The company has been using powerful marketing techniques in presentations of its products in the global markets. Additionally, the company operates in different market segments and focuses on selling the products in hot geographical regions. Coca-cola is a famous brand in the world, and it is one of the most recognizable brands on the planet. The company has become world largest and accepted name. Keller’s Brand Theory Lane Keller, a marketing professor, developed Keller's Brand Equity Model known as customer based brand equity in the early 1990s. Keller's brand concept has been trending widely in the world; multinational companies had borrowed the Keller's theory to build products brand. In his study Keller (2013) suggests that, for a company to build strong brand equity in the market, company's managers first understand the consumer's feelings, thoughts and reactions towards company's products. In other words, customers' thoughts feelings, reactions, and perceptions towards the enterprise's products determine the strength of the brand. For instance, Coca-Cola brand reputation across the world has given the company competitive advantage. The company carries market analysis before introducing new products in the market. In this aspect, people across the world feel, react and perceive positively towards the company’s products. Keller presents four brand-building platforms, which apply to both small and big enterprise: brand identity, the meaning of the brand name, brand response, and brand resonance. Brand identity is a technique that the company uses to build the brand. Brand identity allows the company to explain to the audience (customers) the core objectives of the enterprise, the type of products the company will provide to the market and the benefits consumers will gain from purchasing and using the products. According to Herbst and Merz (2011) brand identity is the first platform that company should use to interact with clients; knowing customers and making customers know the brand name. For example, Coca cola brand identity corresponds to the company’s slogan and the package: the bottle style and slogan “Coke makes you Happy.” To create product identity, Coca-Cola usually carries out market analysis to understand consumers’ needs and how customers’ responds to the company’s brand. Moreover, the company has been segmenting its markets because consumers’ perceptions vary from one market to the other. For instance, the demand of coca cola is low in cold areas, but the company had presented alternative products adaptable by customers in these cold regions. The long-term physical feature of the Coca-Cola is to get into the market and listen to their clients. However, companies venturing into new markets should know the market demands before segmenting and positioning the products. Additionally, it is important for marketing managers to classify the products to narrow the customer’s choices over the competing firms within the industry as Coca-Cola does. Additionally, organizing products in segments offer the customers with the variety of options. In other words, the company should develop unique product differentiation method. In this aspect, brand identity allows the managers to evaluate how customers perceive towards company's brand name. The diagram below represent’s Keller’s Brand Equity Pyramid: Adopted from Strategic Brand Management by Keller (2013) Brand meaning is the second pillar of building the brand equity. Keller (2013) states that communicating and explaining the significance of the company's brand to their clients is of great importance. Coca-cola has been enjoying massive product popularity in decades due to its communication strategy. First, the company created time and gave the customers an opportunity to explain and know the usefulness of the business's products. Second how the coca cola products fulfill and meet consumers’ needs. An efficient and robust marketing strategy used by the company has been the primary and central communication platform. According to 2013 annual report, coca cola spent over $3 billion on advertising as a way of exploring and communicating the meaning of the company's brand to the clients. According to Nyadzayo et al. (2011) the way companies present their products should illuminate the company's ability to offer durable, reliable and affordable products. In other words, the product's image illustrates the real meaning of the company's brand. In this case, Coca-Cola has been presenting its products in a unique way; the company's marketing campaign strategies have been promoting the company's brand. Another important factor is that the image of the product should meet well consumers psychological needs. According to Eggers et al. (2013) a positive brand image attracts customers, and this translates to customers choosing the company's products, and mitigation of competitive forces. Therefore, the brand name meaning determines the long-term success of the enterprise. Coca-cola has undergone a long process before attracting large customers across the world. Today, the company has many local marketers who ensure that the corporation's brand retains its reputation in global markets; continue to attract more clients and the brand remains above the competitors within the industry. The company’s brand image has a global reputation due to its appearance, advert creativity and excitement it portrays to the clients. The third Keller's cornerstone of building a strong brand is a brand response. In these building blocks, customers might either become judgmental or translate their feelings towards the products. When the client is judgmental towards the brand exposes brand's quality, superiority, and credibility (Soon, 2011). According to Alshuaibia and Shamsudinb (2016) customers’ reactions towards the brand depend on how it makes the client’s feel. Self-respect, social approval, security, and excitement are some of the feelings that customers portray when responding to companies brand (Biedenbach and Marell, 2010). In this aspect, the strength of the brand makes the customers feel secure and confident towards the products. In modern times, coca cola is a brand that touches thousands of people on a daily basis. For instance, wherever there are celebrations, sporting or any other social activity, Coca-Cola brand must appear. Therefore, millions of consumers’ of Coca-Cola products have been developing positive feelings towards the company’s products. Coca-Cola also uses demographic factor when presenting its products in the market. The company provides a range of goods that fit each market segment. For instance, the company relates Coke to the youths, sprite to athletes and mineral water for all. Finally, brand resonance is the fourth block of building a brand. According to Keller (2013), is the largest block in the pyramid for it involves bonding the company's brand with customers' psychology and feelings. There are four components of brand resonance: active engagement, community's sense, attitudinal attachment and behavioral loyalty. Customers' active participation in company's activities even without purchasing of the products is of great importance for it promotes building the brand image in the wider market (Soon, 2011). The brand becomes stable when people actively relate themselves to the company's brand (community sense). Attitudinal attachment evaluates how consumers value the company’s brand and they naturally attached to company’s products. Finally, behavioral loyalty represents the consumers’ purchasing behaviors. Coca-Cola has been sponsoring sporting activities, and charity walks for a long time. Most of the customers’ engage in these events due to company’s brand reputation even if the participants are not taking soft drinks. People like associating themselves with the coca cola, and hence, giving the company a substantial and long-term competitive advantage incubates. In this aspect people naturally attached to the Coca-Cola brand translating to brand loyalty. Conclusion The central role of having a strong brand in the market is to establish and dominate market segments. The finding of this study found that, building a strong brand the company requires to come up with a unique way of presenting its products in the market. Keller's theory offers an insight of an effective way of building a strong brand equity using four pillars: brand identity, brand meaning, brand response and brand resonance. As an example, Coca-Cola is a brand with a global reputation. The company provides a variety of products to its market segments in accordance to their needs. Today, the company's brand is the largest in the world. In this aspect, it is important to know and understand customers' needs before positioning products in the market, provide to customers' what they are demanding and develop unique product image. 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