What makes a product like Coca-Cola an iconic brand? How is it so well known that people around the world instantly recognize and buy it? A big part of the answer is found in its brand strategy. Learn about the components of a brand strategy and how to formulate one.
Definition of a Brand Strategy
A brand strategy is a formal plan used by a business to create a particular image of itself in the minds of current and potential customers. When a company has created and executed a successful brand strategy, people know without being told who the company is and what they do. Companies as large and established as Coca-Cola, as well as small brands and even businesses that sell services to other companies, all benefit from a carefully created brand strategy. As a result of brand strategy, people develop a particular feeling or opinion about a company—a feeling that drives their buying decisions. This feeling equates to brand equity. The stronger people feel about a brand, the stronger the brand equity.
The Coca-Cola Example
Coca-Cola, or Coke as it's best known, provides a comprehensive example of an effective brand strategy. What began in 1886 as a syrup mixed with carbonated water and sold at soda-fountains in the American South is now a global, multi billion-dollar brand. It achieved this success through a carefully planned and consistently executed strategy aimed at making Coke popular, trusted, sought-after, and successful.
Shortly after the Coke formula was invented, one of the original Coke business partners suggested the name and designed the Coca-Cola logo still used today, including its distinctive font. Now that the product had a formula and a name, it needed customers. That's where the next step of the Coke brand strategy came into play—building relationships with potential new customers by handing out coupons for a free sample of Coke. This goodwill gesture of a give-away became the first Coke marketing campaign.
The next sign of success for Coke came in the form of competition. Other soft-drink makers began to try to imitate the Coke formula. It was easy to fool people in the days when sodas were sold primarily in glasses at soda fountains, with no ability to identify the product with a familiar bottle or aluminum can to ensure authenticity.
To counter the competition, Coke began its own bottling operation. At the same time, it began to build a distribution network so that Coke could be sold far outside the bounds of its native Atlanta, Georgia. But bottling operations in far-away cities used whatever bottles they had on hand, which meant that Coke was being sold in bottles of all different shapes and sizes. This inconsistency threatened the brand integrity of Coke—in other words, the expectations its customers had of the brand. Without a consistent appearance, a brand's ability to build loyalty is diminished. So, Coke designed its own unique bottle in 1916.
Throughout the 20th century, the evolution of the Coke brand followed a series of logical steps that, taken together, comprise a brand strategy. Not coincidentally, these steps share a lot in common with the components of a brand strategy for any product or company.
Common Components of a Brand Strategy
The answers to the following questions provide the framework for creating a brand strategy for virtually any brand. Thinking them over carefully and writing down the answers is an important exercise in creating a brand strategy.
What does your product or service do? In the case of Coke, their famous slogan explains what Coke does: 'The Pause That Refreshes.' So, Coke provides refreshment. An office supplies store might answer this question with 'we provide convenience and cost-effectiveness.'
Who is your product's target audience? It's important to narrow this down from everyone to the key groups of people who are likely to be interested in your product or service.
What is your brand's image? This question goes beyond logo and incorporates font styles, colors, types of imagery, style of language—everything perceived by the five senses that represents your brand.
How do you want your brand to make people feel? Coke might answer, 'Relaxed, happy.' An auto repair shop might answer, 'Relieved, treated fairly.' A clothing store that serves business women might answer, 'Sophisticated, confident.'
Where and when are people likely to encounter your brand? When you have a clear answer to this dual question, you have a road map to create a marketing plan that ensures your target audience sees your brand's message every time and place you want them to see it.
Why should people choose your brand over a competitor? This question helps you differentiate your brand, which is to explain in clear language how your brand is better or more desirable than a competing brand.
Who's in Charge of a Brand Strategy?
People in marketing roles are usually the ones in charge of creating and implementing brand strategy. However, everyone in a company has a responsibility to reinforce the brand through their actions and especially by the way they treat customers.
A brand strategy is a plan used by a business to create a chosen image of itself in the minds of its customers. When it's successful, people will know who a company is and what it does. Brand strategy can be used to help build brand equity, which is a particular feeling or opinion about a company—a feeling that drives their buying decisions; it's how strongly people feel about the brand. All kinds of companies rely on brand strategies to help gain new customers and build sales.
Coca-Cola stands as an enduring example of one brand that has thrived from its brand strategy as well as an endurance of brand integrity, which involves the expectations a brand's customers have of the brand. Coca-Cola succeeded at this because they became consistent about the way they presented themselves and their product. The image of their product has become embedded in everyone's minds because the company has made sure to utilize humans' five senses in their marketing.
Answering a core set of questions is a way that a business can go about creating its own brand strategy. Typical questions include 'What does the product do?' and 'Who are the potential customers?' and 'Why should people choose your brand over a competitor?' This last question helps you differentiate your brand, which is to explain in clear language how your brand is better or more desirable than a competing brand. The people responsible for marketing are usually the people who create a brand's strategy, but everyone in a company has some role to play in making sure it is implemented.
Brand Strategy Key Terms & Definitions
- Brand strategy: A formal plan used by a business to create a particular image of itself in the minds of current and potential customers.
- Brand equity: A particular feeling or opinion that influences the buying decisions for a particular brand.
- Brand integrity: The expectation customers have of a brand.
As you come to the end of this lesson on brand strategy, make a goal to:
- Define brand strategy and brand equity
- Consider how Coca-Cola uses effective brand strategy
- List some of the common components of brand strategy