Why brand owners don’t own their ‘brand’


The origins of the term branding is illuminating as it comes from the practice of burning a hot mark onto the rear of a cow to indicate ownership by the farmer.

Since the rise of packaged goods companies such as Coca Cola in the 19th century, the term shifted to mean the name, design or symbols that distinguish a product or service of a business from a competitor. Ownership remained the over-riding objective of the exercise but the space that has been ‘branded’ has shifted from the backside of a cow to a customer’s mind.

As understanding of the human mind improved during the 20th century (particularly with the insight from the relatively new discipline of behavioural economics), marketing became more sophisticated as it became known that the visual cues of a ‘brand’ whilst key to recognition were in effect acting as a shortcut to a whole menagerie of meaning which was built up over time in the minds of a customer (or indeed a non-customer) through experience with all facets of the product or service.

And there is the rub. A ‘brand’ is created in a customer’s mind from the sum total of experiences with a particular brand as perceived by the customer. Unlike the farmer branding his cattle, the business or ‘brand owner’ doesn’t own their ‘brand’, how could they as a ‘brand’ is a collection of perceptions in someone’s head!

So the game in town of ‘brand’ ownership is really about how to protect the ‘goodwill’ built up over time for the ‘brand’ managed by the brand owner and broadly speaking there are two (not mutually exclusive) options open to a brand owner.

The first is legal. A brand owner can protect its ‘intellectual property’ for example by registering a brands distinguishing features in a ‘trademark’. Should another business then seek to ‘pass off’ features of a brand to tap into the ‘goodwill’ built up over time, the brand owner can sue

them for trademark infringement, which does indeed happen from time to time for example with private label ‘aping’ famous brands of shampoo or toothpaste.

The second is marketing. Given a ‘brand’ is the sum total of experiences perceived by a customer, legal protection will have its limits hence the other option to stay ahead of an imitating competitor is for a brand owner to proactively manage how a brand is perceived.

This proactive ‘brand management’ would hence need to consider not just the quality and visual appearance of the products or services sold compared to their competition, but also other aspects such as where the ‘brand’ is available, what price its sold at, what messages are seen and heard, who delivers it and by what method etc. A theme I will return to in future blogs.

So to conclude, whilst a brand owner doesn’t own the brand in a customer’s mind, through proactive legal and brand management the ‘goodwill’ associated with the brand can be!

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