How does branding affect the value of a service or product?

The highest cost in business isn’t “media,” “employee,” or “logistics.” The highest cost is the lost opportunity cost of being anonymous in the marketplace.

If a customer doesn’t recognize your brand within half a second, it means you’re not present in their minds strongly enough, and to capture their attention, you’ll need to use other tactics: for example, attract them with price, an additional promise, a product benefit, or a promotion. Often, to be chosen, you need to offer some sort of additional “incentive.”

Good branding eliminates the need for such additional incentives; it makes the customer say, “I’ll take it – even if it costs more.” Branding builds memory, shortens the decision-making process, and accelerates the decision, ultimately yielding a tangible result in the form of a higher margin.

Good branding, through distinctive brand codes (e.g., logo, color, sound, shape, language), facilitates identification on the one hand – the customer immediately knows it’s “that brand.” On the other hand, it justifies the difference – the customer immediately understands why it’s worth choosing. In addition to generating volume, it supports pricing by reducing price flexibility.

Brand codes are often treated as aesthetics. This is a mistake. They’re like a keyboard shortcut to your brand in the customer’s mind. If they work, each subsequent campaign launches with an advantage: less translation, less media investment.

In theory, this sounds logical and simple, and most companies think they have these “codes.” However, research by Ipsos and Jones Knowles Ritchie, reported by Marketing Week, found that only about 15% of codes are “truly distinctive” – those that, on their own, immediately evoke the brand in memory.

The study’s authors emphasize that the key isn’t just “nice design,” but also the consistent, long-term use of a brand’s code. The study shows that colors and slogans are the weakest in terms of unambiguity. The strongest asset, identified by 31% of respondents… is the product itself, its form, and appearance: e.g., Guinness, Lego. Even the logo fares worse than one might think: only 19% of logos achieve the level of unambiguous brand association.

In recent years, we have had good examples of branding or rebranding cases on the Polish market:

1. Żabka – chain rebranding that brings profit

Once a store with a distinctive crouching Żabka sign above the entrance, with interior aesthetics that left much to be desired, today it’s a modern store pioneering cutting-edge technologies, a publicly traded company conquering international markets. It’s safe to say that the only thing that remains of the former Żabka is the name. A contemporary logo, translated into the store’s aesthetic design and the adoption of distinctive greenery, has significantly strengthened the brand’s position in the retail market. In addition to the visual identity change, the 2015 rebranding encompassed many other areas: from a carefully curated product range aligned with the customer’s mission, aligned with the convenience mission, to distinctive marketing communication. The rebranding resulted in the brand rapidly rising to the top 3 Top of Mind (ToM) awareness rankings, and its recommendation rate increased by an impressive 233% (2017: 9%; 2019: 21%).

2. Labubu – branding an impulse product that makes money quickly

Labubu is a textbook example of how concept & branding can turn a small item into a global “must-have” impulse item.

The seemingly “frivolous” concept of a sweet and slightly feisty doll has become a serious business – thanks to a precisely constructed branding and distribution system: the original idea created by Kasing Lunga has been translated by Pop Mart into a mass shopping ritual (blind boxes, limited editions, vending), which combines the emotion of surprise with the mechanics of scarcity and drives repeat purchases.

Collaborations with large brands and franchises (e.g. Coca-Cola, One Piece, Naruto, Vans), “legitimization” in the fashion world (e.g. presence at Marc Jacobs), among celebrities and athletes strengthened the status of the object of desire.

Pop Mart’s revenue from Labubu in 2024 exceeded EUR 796 million and accounted for approximately 23% of the company’s revenue.

3. Heyah – a spectacular branding effect in a saturated market

In 2004, Heyah entered the seemingly established mobile market with an unmistakable code: “paw,” contrast, a bold tone, and the promise of a simple game without “fine print.” This heralded a new prepaid offering from one of the major players. The brand’s image, with its black and red color scheme, comic book elements, and graffiti, were therefore the right tools to reach young people. Furthermore, the offering itself simply had to be understandable and “no bullshit.” The result? According to industry materials, the brand was supposed to reach 1 million subscribers in eight weeks and achieve its annual sales target in two months; the overall launch campaign was supposed to reach 446% of the target.

The simple, distinctive message meant that young people largely bought not the product, but the attitude. According to many experts, it was the best teaser campaign in the history of Polish advertising. It has become a permanent fixture in the list of those that have become synonymous with the perfect brand launch and an inspiration for many other companies and agencies.

4. Building a product brand to increase profitability

Let’s imagine two food products with similar ingredients and identical weight: for example, 500g corn flakes: Nestlé Corn Flakes vs. Carrefour Classic Corn Flakes, where one product is branded, the other is the chain’s own brand. In this case, the price difference is PLN 24.58/kg vs. PLN 15.10/kg, even though you get practically the same thing “inside.” This is the most tangible proof that branding can be understood as creating added brand value. The market actually pays more for the same product. A brand acts as a guarantee of predictability (taste, quality, consistency), shortens the decision-making process at the shelf, and reduces price sensitivity—the customer pays extra not only for the ingredients, but also for the certainty of their choice.

That’s why many private brands go a step further and not only compete on price, but also try to “borrow” recognition through similar design: similar colors, arrangement of elements, typography or product photos, so that from a distance on the shelf they communicate “this is like that, only cheaper.”

This phenomenon is so widespread that it has become the subject of legal and media disputes – for example, there have been high-profile cases of accusations that private-label packaging resembles well-known brands in discount stores. To make direct price comparisons somewhat more difficult, chains often ask suppliers for different packaging formats, weights, etc.

A brand not only allows you to sell at a higher price – it is so valuable that others try to simulate it with design, because they know that in impulse purchases, the “first half a second” often determines what ends up in the basket.

5. Building a brand after the sale transaction

There are situations in which branding is a necessary consequence of a business decision: selling a company, joining a larger group, realigning a brand portfolio, or expanding into new markets. In such cases, rebranding serves as “infrastructure” for the strategy – it should complete the ownership change, standardize standards, and clearly communicate that the organization is now playing in a different league. A good example is the transformation of Elektroskandia into Enexon: the company announced that it had been operating under a new name since January 2019, and the impetus for the change stemmed from the inability of the new owner (the Würth Group) to use the previous name. This is a classic case where a brand must “keep up” with real organizational change: a new identity streamlines market perception, reduces the risk of customer confusion, and paves the way for scaling without constantly explaining who we are “after the change.”

In an era of intense competition, advantage is built not so much on what you sell, but on how quickly and clearly the market understands you – and why they should choose you, even if you cost more. That’s why branding is so crucial to company/brand strategy.

Proper branding is designed to accelerate recognition and is effective when it translates into numbers: less reliance on promotions, less price flexibility, and more stable sales. Ultimately, a brand is meant to be chosen. So, if we’re looking for a definition of branding that will pass muster in the boardroom without a smile of condescension, it goes like this: branding is a tool that turns anonymity into profit margins. And profit margins, as we know, are the most elegant form of competitive advantage.

Source: https://www.marketingweek.com/15-brand-assets-truly-distinctive-finds-research/