What is Branding and why is it so important?

May 21, 2018
Will Kaye
Managing Director

Whether you are a serial entrepreneur fleshing out your latest bright idea, a new business owner striking out on your own ..

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Whether you are a serial entrepreneur fleshing out your latest bright idea, a new business owner striking out on your own after a lifetime of corporate drudgery, or a long-time shop owner ready to try something new. The right brand can make or break your business. Brand identity is more important than ever, and modern consumers often make their buying decisions based on how they feel about the underlying company and its values.

You probably already know that branding is essential for a successful business, but what is branding, and how did it come to be. The history of branding is long and fascinating, and having the right background can help you develop a winning branding strategy for your company.


Fans of the Old West may recognise the origins of the word brand, but the term actually goes back much further than the American frontier. The word “brand” derives from a proto-Germanic root – one that roughly translates to “to burn with hot iron.”

The word “brand” first came into the English language sometime in the 1400s, when it was used to describe an identifying mark burned into the skin of criminals. A century later, the term was largely used to describe a similar burnt mark, but this one was used on cattle.

By 1580, the cowboys of the age were routinely burning stylised symbols into their stock, symbols that were called brands. A few centuries later, in the 19th century, the term brand would be used to describe products that bore the mark of their creators.

The term “brand name” is even newer, dating back to just 1922. It seems like the term has been in use for much longer, but the history of the modern brand is actually quite short.


In many ways, the modern brand is a product of the modern world. When the term first got its start, the marketplace was a relatively simple place. But with the rise of packaged goods, manufacturers sought a way to differentiate themselves and their products, and the modern brand movement was born.

As the 19th century got underway, the makers of consumer goods used branding as a way to indicate their sources and point out the quality of their products. From cough drops and over-the-counter elixirs to soft drinks and beer, brands were beginning to differentiate themselves.

Coca-Cola is a case in point, and a great example of how branding can benefit a product. There were plenty of competing sodas on the market when Coca-Cola got its start in the late 1880s, but a few decades later, soft drink fans were asking for a Coke. Coca-Cola had successfully set itself aside from the competition, and a corporate titan was born.


You might think that branding benefits only the business involved, but that is not strictly the case. While successful branding is one of the most effective ways to boost profits and drive sales, there is more to branding than just bottom line results.

Branding does indeed benefit entrepreneurs and small business owners, and it is a valuable tool for corporate entitles trying to differentiate themselves from the competition. What many people fail to realise, however, is that branding is just as beneficial to consumers.

When a college student needs a new computer and chooses an Apple iBook instead of a Dell, he or she is buying into the Apple brand. The computer may be solid, but the brand identity plays a big role in the buying decision. By making the choice, the Apple fan becomes part of a larger community of enthusiasts, one that has helped the tech titan become one of the biggest players in the industry.

This consumer brand benefit is not limited to Apple. There are countless examples of brands that consumers love. From outerwear and coolers to furniture and cars, consumer loyalty is a big part of brand identity.


Branding is a vital part of the modern marketplace, and an essential part of life for any business. For startups and new companies, branding is used to help the new firm get a foothold in a crowded marketplace. After all, consumers cannot ask for a product if they do not know it exists.

For established firms, branding is used to establish quality and set the firm’s products apart from their competitors. This is a particularly valuable part of the branding strategy, since the marketplace for many products is more crowded than ever before.

Branding allows businesses to differentiate themselves on the basis of quality instead of price. Business owners can always compete on price, but doing so means slashing their profit margins and putting their future growth at risk. By focusing on quality and brand building, business owners can maintain their profit margins and keep their growth prospects in place.


Branding is an integral part of the marketing strategy, but it is not just another advertising campaign. Leaving branding to the marketing department minimises its importance, and it could cause business owners to miss out on the bigger picture.

Whether you are building your brand from scratch or rehabilitating a substandard brand, it is important to understand how your branding strategy fits into the company as a whole. Feel free to keep the marketing department involved, but do not rely on them to do all the heavy lifting.


Branding a business is a vital part of differentiating your firm from the competition, but just what is involved in business branding? Business branding is not one thing – it is an interrelated set of strategies and actions, all designed to create a cohesive picture of the company and its products.

Branding includes things like brand strategy, an overarching approach to creating a brand for the business in question. It also includes developing a brand story, telling the origin story of the business and how it came to be. Brand message is also a key part of successful branding, as is the logo and brand identity.

The voice and tone of the business is another part of the brand identity, something sometimes referred to as brand personality. From the website and blog to the packaging, photography and physical space, every part of the business should serve this brand personality. In other words, every part of the business, from the front-line customer service workers to the CEO in the corner office, must speak with the same voice and tone.

From brand new companies to centuries-old institutions, every business needs a solid branding strategy. Now that you know a little bit about the history of the branding term and the origins of brand identity, you can work on creating a great image for your company.