From manufacturer to consumer brand: will you succeed?

From manufacturer to consumer brand: will you succeed?

New brand logos

Many companies that produce tangible products are wondering whether they should invest in establishing their brand abroad. For many Chinese companies this would mean building a completely new brand, given the different writing of their brand name. Even although they may be very successful in China and are the market leader.

Creating a brand is the first step, and you can make many mistakes with that. Brand names may be unpronounceable in a specific language, have the wrong meaning, or may sound like a word with a negative connotation. Creating a brand requires also clear thoughts on who is the target audience and what the brand needs to convey. It’s more than a name. If you have passed that hurdle, then the second and more expensive step comes: promoting your brand. 

Reasons for creating a brand

There can be two reasons for creating a brand: to increase price levels or to increase customer retention.

A well ‘loaded’ brand may increase the price of a product or service. ‘Loaded’ in this case means that the brand brings the right associations, which is mainly done through advertising: you see successful, beautiful or happy people using the product. The product makes you stand out, makes you look smart or irresistible. So you don’t only buy the product, you buy a bit of that perceived ‘luck’ with it.

Having a clear brand can also increase customer retention. If your product or service was perceived well, and there is a need for a new purchase, it helps if customers can clearly recognise your product or service outlet. They will make a quick decision, take no risks, and return to you, even if there are cheaper alternatives. However, this only works in case of regular purchases, and not with a wedding dress.

Business-to-business and consumer brands

The choice of your target group is the most important in branding. Are companies your target group, because they use your product as a component or your service as a means in their operations? Or is your product or service meant for consumers?

In business-to-business of course the functionality of your product is important, but also aspects like speed of delivery, training or customer service. How will your product or service help your business-client to make more profit? That will be the key question to answer and to stand out on.

In case of a consumer product the choice will be whether to sell it under your own brand, or have your distributor brand it under his name. In the latter case you will just be his supplier. Although for the consumer your brand will not be stressed, for your distributor you can still enhance the value of your brand by emphasising your speed of delivery, quality, product knowledge, ease to work with or innovation capabilities.

For a consumer brand you need to stress the functionality of the product, but also the feeling. As for cars, should your clients feel safe (Volvo), rich (Mercedes), sportive (Alfa Romeo) or dignified (Audi)? Depending on the product range it will be extremely important with elements you like to stress.

Loading your product with an emotion requires multiple interactions with your potential clients. They should at least have seen five times an add, TV-commercial or presence in the street. TV advertising can easily cost 30 USD per 1000 viewers to reach. So only for a small country like Singapore with five million inhabitants you need to spend 750,000 USD to reach everybody five times. This is of course excluding the costs to create and make the commercial.

What type of brand to choose?

Being a consumer brand requires heavy investments. It only makes sense to rollout such a brand in a country if this will pay itself back in higher prices or more repeat sales. Heineken spends 10 to 15% of their annual turnover on marketing and sales, but it gives them a clear premium over other brands. Their business case is relatively easy: a large part of the population drinks beer frequently, so any TV-commercial is well spent. If you are selling tablecloths then you have a different business case, since people only buy them once in a few years and the design is mostly leading over the brand.

Building a business-to-business brand is less an investment. And good branding can make a big difference. Having the story of your existence ready, knowing what your company values are and how these translate into your products and services is however of key importance. A brand is more than a name and logo. And the right elements of a brand may differ per country.

Alliance experts can help you translate your business approach into a brand that is suitable for the countries where you want to go. Ask one of our specialists.

This entry in exports was updated on October 13, 2016 by specialist.