Product Decisions

1. Product Packing, Branding
and Labeling
Dr. Pooja
Assistant Professor
Dept. of Commerce
AMPGC, BHU
Product Decisions

3. Origin of Branding Practice
• Brands have been around for many years since business began. The managers thought
about branding once the product was developed, priced and packaged. Branding a product was
a decision in the end and was never given any significance as they felt that good product will
generate sales automatically.
• Branding was a passive activity; giving names to products designed and manufactured at the
company’s will. But, in the last two decades they are the hot spots in total marketing process.
They constantly appear in the financial strategy and valuations of a company. When brands are
so important, branding becomes even more important.
• The word ‘brand’ has been originated from the word ‘brande’ which means ‘to burn’. In the
16thto 18th century, branding was merely an identity creation and was used by Greeks and
Romans to identify their offerings to their sacred Gods. The farmers used it for identifying their
livestock, and distillers put a heat embossing on their wooden casks to differentiate it from the
spurious brands. In England, heat embossing symbols were put on the cheeks of the slaves in
order to ‘brand’ them for a particular owner.

4. What is Branding
• Brands are all around us. We live in a world of branded products and services.
Every day we are exposed to a plethora of brands right from dawn to dusk. It is ironic
that we do interact with brands more than humans in a single day. Since the dawn of
history of mankind, there has been a desire to establish one’s identity separate from
those of fellow human beings.

5. Definitions
• According to American Marketing Association, “Brand is a name term, sign,
symbol, or design, or a combination of them which is intended to identify the goods
or services of one seller or a group of sellers and to differentiate them from those of
competitors.”
• According to Mellerowicz, “Brand is defined as branded product as an
ubiquitous finished product of consistent or increasing quality for private
consumption with an identification mark, standardised amount, and appearance,
acceptance in the market and existing consumer advertising.”
• The American Marketing Association (AMA) defines a brand as “a name, term,
sign, symbol or design, or a combination of them intended to identify the goods and
services of one seller or group of sellers and to differentiate them from those of other
sellers”.

6. Significance of Branding
Significance of Brands to Consumers:
i. Brands facilitate the identification of products at the point of purchase.
iii. Brands give consumer greater freedom of choice in where they buy the product.
iv. Brands lead to improved products due to competition and continual product differentiation.
v. Brands simplify the purchasing transaction because consumers are familiar with the
trademarks.
vi. Brands can serve as a warning against repeat purchase if the first purchase and use of the
product proved disappointing.
vii. Brands simplify consumer problem-solving and information processing.
viii. Brands help consumers feel good about their purchases. Brands have social benefits for
consumers.
ix. Brands improve consumer value.
x. It provide consumers with choice.

7. Significance of Branding
Significance of Brands to Firms:
i. Products, and particularly the brands, have to be pre sold through advertising so that the consumer will
recognise and select those products on retailers’ shelves.
ii. Brands facilitate the use of non-price competitive strategies, such as product differentiation, although of
course, price competition can never be eliminated completely.
iii. Brand trademarks facilitate product diversification is certain respects. A new product item can, e.g. be
added with greater ease to a known product line as compared with one that has trademark.
iv. Strong brands command higher price points and higher margin.
v. Strong brands embody a clear, valued, and sustainable point of difference.
vi. Strong brands offer internal focus and clarity within an organisation.
vii. Brand strength is a lever for attracting the best employees and keeping satisfied employees.
viii. Brands promote competition (consumers gain from brands competing strongly) for their patronage.

8. Major Functions of Brands Related to
Consumers
i. Identification of Product Sources: Brands naturally project the identity of the producer and
marketers because they reflect the initiator or creator of the product.
ii. Assignment of Responsibility to Product-Maker: The consumers are authorised by the
brands to allocate the authority to a specific distributor or producer. Above all, brands have a
significant impression to win over the consumers.
iii. Risk Reducer: A buyer may realise several kinds of risks during procuring and utilising
products including physical, financial, functional, social, psychological, risk of time wastage, etc.
iv. Search Cost Reducer: The amount of money spent by the consumers’ on exploring various
products is reduced considerably with the help of branding. Brands assist in minimising these
costs at the internal level, i.e., in relation to the expectations of the consumers and at the
external level, i.e., in terms of exploring the other available options in the market.

9. Major Functions of Brands Related to
Consumers
v. Promise, Bond or Deal with Maker of Product:
A brand and a consumer share a relation which can be termed as a kind of “bond’ or
‘commitment.’ Consumers being faithful and dedicated towards a brand have an implied
perception about the behaviour of the brand.
vi. Symbolic Device:
Brand can act as an illustrative mechanism which enables the consumers to present their own
personality. Few specific brands indicate different characteristics or values due to their
association with particular class or category of people.
vii. Signal of Quality:
Brands can act as major contributors’ towards conveying particular product attribute to
consumers.

10. Major Functions of Brands Related to
Manufacturers
i. Means of Identification of Simplify Handling or Tracing:
Basically brands carry out the function of recognising which simplifies the task of handling and
tracking down products in an organisation. It facilitates inventory management and helps in
maintaining accounting records.
ii. Means of Legally Protecting Unique Features:
A company receives security in legitimized way because of brands. The exclusive outlook and
characteristics are safeguarded by brands. A brand helps a company to keep possession of its
Intellectual Property Rights and also offers legal status to a brand owner.
iii. Signal of Quality Level to Satisfied Customers:
Regular and satisfied customers are prompted to buy the product one more time because of the
brands which communicate about the level of quality maintained by the product. This
commitment provides the probability and certainty of demand to the company.

11. Major Functions of Brands Related to
Manufacturers
iv. Means of Endowing Products with Unique Associations:
A product is graced with exclusive features or associations or reputation due to branding.
Thus, it helps in making the product unique.
v. Source of Competitive Advantage:
Branding acts as a source of competitive advantage. Generally, product designs or
production/manufacturing techniques may be copied by the competitors.

12. According to
Ownership
Manufacturer’
s Brand
Middlemen’s
Brand
According to the
Market Area
Local Brand
Provincial
Brand
Regional
Brand
National Brand
International/
Global Brand
According to the
Number of Products
Family Brand
Product Line
Brand
Individual
Brand
According to Use
Fighting Brand
Competitive
Brand
Types of Branding Strategies

13. 1. Branding Strategies on the basis of
Ownership
i. Manufacturer’s Brand
When the name of the manufacturer of the product is used for branding the product, it
is called manufacturer’s brand. For example, using name of Samsung for branding its
products like smartphones, TV, AC etc.
ii. Middlemen’s Brand
In this type of branding, instead of the manufacturer it is the middlemen whose name
is used as brand. The middlemen may be wholesalers, retailers, etc. For example,
wholesale stores such as Wal-Mart, Best Price, Metro, etc.

14. 2. Branding Strategies on the basis of
Market Area
i. Local Brand
In this, the brands are decided keeping the local markets in mind. Thus, there are
different local brands for different markets.
ii. Provincial Brand
In this, the brand name is decided for a particular State or province. Therefore, for a
single product, different brand names exist in different provinces.
iii. Regional Brand
In this, the brand name is for a particular region. Different regions will thus have
different brand names. The entire country may be divided into regions like North,
South, East, West, Central, etc.

15. 2. Branding Strategies on the basis of
Market Area
iv. National Brand
When a particular product is available with the same brand name throughout the
country, it is referred as national brand. The product is only being nationally distributed
and marketed.
v. International/Global Brand
When a particular product is available with the same brand name throughout the world,
it is known as international brand. Nowadays there are many of the global brands that
are sold in international markets. For example, Coca Cola, Starbucks, Apple,
McDonald’s etc. These brands are selling the similar product in the international market
(different countries).

16. 3. Branding Strategies According to
the Number of Products
i. Family Brand
When all the products of a company are marketed with the same brand name in different
market segments, it is called family brand. For example, the Reliance Group uses its parent
name to brand various product lines like Reliance Petro chemicals, Reliance Communications,
Reliance Retail, etc.
ii. Product Line Brand
When a company decides to give different names to different product lines then it follows
product line branding. For example, Hindustan Unilever uses this strategy to brand its various
product lines like soaps, beverages, detergents, etc.
iii. Individual Brand
When the company uses different names for the products in the same product line, it is called
individual branding strategy.

17. 4. Branding Strategies According to
Use
i. Fighting Brand
These brands are launched in the market with a significant difference from the brands that
are already being offered by the competitors of the company. In other words, these brands
try to get a distinct positioning in the market vis-a-vis the competition.
ii. Competitive Brand
Competitive brands on the other hand fight for the same positioning in the market and do
not have any significant differences. For example, Rexona, Lux, etc., are all examples of
competitive brands.