Before diving into, let us define what is Brand?
A brand is a name, term, design, symbol, or any other feature that identifies one seller’s good or service as distinct from those of other sellers. This is more on a textbook side of the definition, let’s break it down where a novice like me also can be understood.
Humans like you and me can’t live without oxygen and it is intangible in nature. In the same way, companies can’t sustain without proper branding and fun fact here is Brand is treated as an Intangible asset in the Balance Sheet.
So, we all know that Kingfisher is a well-known brand but it is a failed airline company, we can’t just go by brand, we should also be checking the company operations, financial statements as well. So, the point I am trying to make here is just Brand is not sufficient, Brand Value is Required.
My first instance of hearing about the word called brand is way back in 2006 ie; Nokia, mobile phone manufacturing, and marketing company. One day all of a sudden all my friends asked me to treat and I am like wondering ‘ what happened to these guys & why is this sudden change ? ‘
Then one of them answered you brought a Nooookia mobile.
My reaction – ‘ Dude it is not Nooookia it is just Nokia and you all are using mobile from a very long period’
His answer – ‘ But we are not using Nokia ‘
My reaction – ‘ What’s the point in it, yours and mine do the same work.‘
He said, It’s not just a name, it’s a Brand!
He explained Nokia is a Brand and what exactly a Brand can do for an individual. (Nokia has ruled for a decade and it collapsed in a year and that is a totally different story altogether, even in this case despite great brand it lost because lack of innovation which leads to bad operations and eventually worst Balance sheet.)
Why Brands Matters to an Individual?
Because of these following reasons;
- A brand is a Social Currency
- A brand gives a Personal Recognition
- A brand makes one to Fantasise
- A brand gives Confidence, above all
- The brand gives Emotional Pleasure
These Brands also has the power to sell their Products & Services for Premium. (Now I can understand why my friend told Nooookia way back in 2006).
So, because of this pricing power, these Brands are making lots of Money and we individuals ended up spending for the above reasons if not all but I can see myself in that list.
How to Get Benefited From Brands?
It’s very simple, invest in those company Brands in which you are emotionally connected. Then we’ll end up burning our hands by investing in companies like Kingfisher & Nokia.
So, how to get benefited from this lucrative market? Because, as we learned just Brand is not sufficient, Brand Value is Required. That’s where smallcase Research team comes into rescue with Brand Value smallcase.
We know that just Brand is not sufficient, we also need the following things to create Brand Value.
- Good Operations
- Strong Financial Statements (Balance Sheet, Income Statement, Cash Flow Statement)
- Quality Management
All these things will be taken into consideration and then they select those Brands which fulfills our requirement. Be an Earner not only Spender for your Brands.