Brand management has emerged as a key concept in this century that is being discussed not just in the marketing area but also in economic and other social disciplines. Although branding has always been a useful tool for business owners and dealers.
In general, academics focused on the function and significance of brands from the perspectives of businesses and consumers, as well as the vital significance of effective brand management to survive in the brutal and cutthroat world of today. A number of significant observations may be made about this new economy, including the fact that markets are dynamic, the field of competition is worldwide, organizations operate as networks, and most significantly the meaning of value has altered. In the traditional economy, “value” is defined in terms of scarcity, however in the modern economy, “value” is linked to the number of users. The way that products are distributed and introduced to the general public in today’s society has altered and elevated the significance of branding.
Economic, political, and military powers are regarded as essential differentiators of competitive advantage for survival in a complicated and highly capitalist commercial environment. A progressive approach including new elements, such as the importance of intangible assets for the growth of economies, has recently been implicated in the change in the growth and stability of national economies so, there is a strong need to understand the economic importance of brands as the past few years brought dramatic changes in the world of brands and branding.
Although the way that brands affect our lives hasn’t changed, their breadth and impact have expanded tremendously. Nonetheless, there is still apprehension and misperception, which has intensified, and there are still some fallacies that influence people’s opinions of the economic significance of brands. Critics claim that brands generate irrational demand and exorbitant prices so, we might live happily without them while some individuals consider that brands are important to consumers and that they benefit businesses and the market as a whole which adds value to economic development as brand and reputation protect the consumers because strong evocative brands today not only raise a particular level of expectation but often elicit a higher emotional, purpose-driven connection as companies seek to strengthen relationships not just with consumers but with everyone associated with their business.
In other words, branding (expression) and reputation (impression) increasingly intersect. This makes brands more responsive and vulnerable to criticism and bad news travels fast, amplified by social media so, so there is no doubt in the fact that, brands are important for any country’s development because brands encourage a type of ‘market democracy’ for citizens allowing consumers to vote daily with their wallet.
Secondly, strong brands drive share performance and can be measured. Strong stock market performance benefits a range of constituents from the companies themselves to individual shareholders, employees, institutional investors, savings companies, pension funds and pensioners.
Thirdly, brands provide more choices and ensure a competitive economy. In regulated markets and planned economies, brands are irrelevant if there is only one supplier to choose from. One supplier alone will be less incentivized to develop and commercialize new ideas if consumers cannot switch. In liberalized markets, brands provide the means of competition by allowing those in the market to distinguish one competitor from another and helping them to assess their offers quickly and efficiently. Moreover, brands support and encourage competition based on criteria other than price, such as reputation, quality, and innovation and because of this, the majority of industries in liberalized economies now provide more options, better prices, and even greater performance than they did in the past. Brands are crucial in deregulated markets because without them, market liberalization attempts would fail.
Fourthly, brands help the economy adapt quicker and grow faster as markets are in a constant flux of adaptation, and technology advancements frequently speed up this process. Since they enable a more dynamic interaction between consumers and sellers, brands help markets change more swiftly.
While the benefits of new and innovative goods typically need more explanation to convince the general market, they are typically accepted by “pioneers” and “opinion leaders”. Brands may therefore serve as both a choice simplifier and an “educational” tool by reducing buyer confusion. Brands can spark consumer interest and excitement for new goods and services, which frequently causes disruption in “crusted” marketplaces. In general, brands provide a substantial contribution to the process of growth and adaptation, which is essential to a competitive economy. Branded goods that fall short of consumer expectations will swiftly be replaced with newer, more potent options.
Fifthly, brands accelerate growth across geographic and cultural borders. Businesses may transcend national and cultural boundaries thanks to brands. Global brands are a huge benefit to their native nation. Brands assist the export and provide employment and give the economy stability. Failing to develop strong global brands places a strain on the domestic economy and represents a missed opportunity. In order to succeed overseas and remain competitive on the global stage, brands are essential. As they speak as an “international language,” by bridging cultural divides. Strong domestic brands, on the other hand, are advantageous because they could offer an efficient, customer-focused response to overseas competition.
In addition, strong brands benefit all stakeholders and ensure accountable actions by the business community so, it is concluded with the fact that brands are crucial and serve as important weapons in the state armory of any trading country in order to propel a thriving knowledge-driven, innovation-led economy and act as an essential part of a liberal economy where businesses compete and customers have the power to make decisions.
Ms. Urooj Aijaz (MD IRP/ Faculty Department of H&SS Bahria University Karachi)
Commander Qiaser Zaman (Faculty Department of H&SS Bahria University Karachi)