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What's in a brand? More than you think
THE list of the world's most valuable brands today might look vastly different from two decades ago, but one thing hasn't changed.
The victors in the branding war are able to stand apart from rivals, attract the right people and weather crises better, branding experts say.
Advertising group Ad Planet's founder Adrian Tan said: "Branding creates a unique desire. It stirs and engages the emotions of the buyer, creating a bias."
It also allows a company or product to sell itself as a cut above competitors - and differentiation is key to keeping the company running in both good and bad times. This is just as true in a business-to-business setting - a strong corporate brand can give the company an edge when it comes to winning a contract.
In addition, it enables a company to play to the emotions of a consumer since purchasing decisions can be driven by both rational behaviour as well as emotions. In fact, a company with effective branding is often in a position to charge a premium.
Mr Tan said: "A Seiko tells the same time as a Rolex. Do you buy time or do you buy a reputation, an image or a brand?
"If you buy a Porche, you are seen as rich, stylish and sporty. A Rolls Royce, and money is no object. A Kia, and you are a practical man."
More importantly, perhaps, successful brands can survive a product crisis, ethical failures or corporate scandals, said adjunct senior lecturer Chen Xueliang from the National University of Singapore (NUS) Business School, pointing to strong brands such as Samsung and Volkswagen.
He singled out local companies such as Singapore Airlines, Banyan Tree and Razer for carving out a niche in their respective categories as world-class brands.
Referring to the Forbes' 2017 report on the world's most valuable brands, Mr Chen noted the "rise of Chinese brands on the world stage" as they grow more accepted today.
"Categories that were once dominated by US brands now have serious competition from China," he said. "Taobao, WeChat, Huawei, Lenovo and Union Pay have become household names in Singapore and beyond."
Similarly, Forbes' Top 10 list now largely consists of technology heavyweights such as Apple, Google, Microsoft, Facebook and Amazon. It used to be dominated by fast-moving consumer goods or automotive brands.
But while strong branding reaps benefits, poor brand management can be a liability. Once trust is broken, the brand becomes linked to negative perceptions.
Mr Chen went on to add: "Once a company decides to be a branded player in the consumer space, a weak and under invested brand can become a liability, in contrast to an active competitor brand's momentum. This can cause a weak brand to lose market share, margins and distribution coverage."
Aside from sales, branding can help a company in other aspects. A strong brand can attract the right type of people, said Wilson Chew, entrepreneurial and private business partner (strategy) at PwC Singapore.
"At the board level, strong brands attract eminent members with strong credibility in their fields. This strengthens the company's strategic capabilities both in terms of the company's performance and its conformance with statutory requirements.
"At the management level, strong brands attract highly competent executives who can drive growth which, in turn, creates value for all stakeholders.
"In the human resource context, a strong corporate brand can help attract, develop and retain talent, and further align staff to the company's cause."
A brand can also be seen as an intellectual asset, since companies with strong brands are able to inspire confidence in investors and lenders alike - and under uncertain global economic conditions, branding is a much-needed competitive tool.
Dr Chew said: "Get it right and the organisation is strengthened towards better long-term performance. Branding is the reason for success, not the reward."