Ethics & Company Branding
The concept of branding is to develop the expectations that are associated with the brand experience, creating the impression that this association has certain qualities or characteristics. This makes branding one of the most valuable elements in advertising, because it is the brand that conveys what is being offered in the marketplace, and which part of the market it represents.
Orientation of a company towards its brand is called integrated marketing, which presupposes that the brand correctly represents the company ethos, services and/or products. Proper brand management, assisted by an appropriate advertising campaign, is a successful formula for convincing consumers to place their trust in the products and services represented by the brand. This method generally consists of projecting the brand image and product/service with the aim of assigning a perceived value to them.
The consumer sees the product in an environment (package) that pre-determines its position and value in the marketplace, and will accept this. Obviously, at this point, the consumer is being told to accept the value of the product based on the worth conveyed by the brand, rather than a logical valuation that comprises the cost of raw materials, manufacture, distribution etc. This is where ethics come in, because while it is fair to cover costs without mentioning them in the advertising, some cynical ‘value-creation’ branding-and-advertising campaigns are aimed at inducing consumers to pay hundreds of times what a product costs to make.
For an ethical company, the brand is far more than the margin between the actual cost of a product and its selling price, rather, it represents the quality of a product to the consumer. Because of the many intangibles that exist in business which have to be covered in the costing, the brand is used to convey the overall quality of a product, which naturally includes the quality of the product development and research etc. Failing to account for the work that has gone into a product when determining the end value would set an enterprise at a serious disadvantage, which is where a good brand can help support a higher margin.
Brands are often created to reflect the values of the target audience rather than the values of the company it represents, which is a cynical way to trade. This is where trends are dictated to gullible audiences, but that is for another post.
Correctly used, branding will reflect the positive values of the company it represents, and these are what ought to determine its rank and value in the marketplace. Branded products or services also command higher prices. For example, where there are two similar products, and one of these has no associated branding (i.e; a generic supermarket branded product), consumers often select the more expensive branded product on the basis of a perceived quality of the brand or the reputation of the brand owner.
