By Matija Šerić
The brand is the strongest factor of competitive advantage and the one that most determines whether a company will succeed or fail in the market. When consumers accept and adopt a certain brand, it enables the brand owner – that is, the entire organization – to operate on profitable foundations, generating income and profit.
Croatian companies struggle with creating recognizable brands, which prevents them from sufficiently penetrating international markets or competing effectively with foreign competitors within the Republic of Croatia. Of course, there are exceptions such as Rimac Automobili, Podravka, or Carwiz rent-a-car, but such companies are too few to ensure the overall economic success of the country. The modern world is no longer static as it once was, and outdated methods of waiting no longer work. Those who wait are swept away in the market.
Global Competition
On both domestic and international markets, companies are undergoing rapid and unexpected transformations as a result of constant changes in the era of globalization, the IT revolution, and the increasing openness of markets. International competition offers a chance of success to those companies that stand out with their entrepreneurship, creativity, innovation, ability to follow trends, and ability to offer lower product prices more aligned with their actual value. Such companies attract consumer interest. Competitive advantage is gained by companies that master knowledge, skills, and limited resources, identify markets for their products, and ultimately create a brand that consumers accept and view as superior to the competition.
Purchase Risk and the Brand
The brand plays an extremely significant and important role in emphasizing the advantages and characteristics of products and services. Moreover, and very importantly, the brand plays a major role in reducing the risk associated with purchasing. During planning, purchasing, and product/service use, consumers face several types of risks:
a) Functional risk – the product may not meet the basic expectations for which it was purchased;
b) Health risk – the product may pose a danger to the health and physical well-being of the user and their environment;
c) Financial risk – the product’s quality may not match the amount of money spent;
d) Social risk – the product may have disturbing or negative effects on other people;
e) Time risk – poor product quality and failure may lead to wasted time.
The better the brand, the lower the risk for the consumer in principle. The brand is one of the best, if not the best, ways to minimize purchasing risk. A brand provides security to buyers because they themselves have experienced it through previous purchases, or their friends have, or there is a general perception that the brand’s products are reliable. For example, the public generally believes that Volkswagen and BMW produce top-quality cars in every segment, which is why people buy them in large numbers. These cars are desirable, and many people buy them simply to own something from these automotive brands.
Brand and Design
Design, in its totality, represents the visual shaping of the overall living conditions of a community. Design is strongly linked to branding because visual identity is crucial for any company. Every brand has its virtual component. The design of a brand is also important from a psychological point of view, as consumers aim to connect with a brand partly because they recognize its characteristic colors, logo, or product shape. A brand must be visually attractive. Consumer thoughts and associations must be positive toward the brand, and visual images play a more than significant role in that process.
Organizations create their brand design based on thorough research that seeks to answer the questions of what consumers want, desire, and are attracted to. Once the answers are known, experts begin creating an appropriate brand design. From a marketing standpoint, design can be seen as a strategic component, whose task is to create harmony of color, style, appearance, and functionality. The more distinctive and memorable the design, the greater the advantage over competitors. Design is what first catches the eye and stays in the memory, so it must be carefully and correctly created.
Conclusion
In today’s market competition, consumers form a special and significant relationship with brands. A brand must meet the needs and desires of consumers. It is also the strongest factor of competitive advantage and the one that most determines whether a company will succeed in the market. When a brand is accepted by consumers, the company gains stable profits and operates positively. The stronger the brand, the lower the purchase risk for consumers. A brand must also be visually attractive. Consumer thoughts and associations must be positive toward the brand, and visual imagery plays a crucial role in achieving that.
Featured image: Unsplash
