How does branding increase sales?

Branding has always been important, but with the rise of social media marketing, how does branding increase sales?

Branding increases sales in various ways – some obvious, some more subtle. In this short article, we are going to take a look at 3 of the main ones:

Value perception
Customer Loyalty
Consistency

Each of these brand benefits contributes to increases in sales.

Value perception

Your brand, as we have observed elsewhere, is your business personality, and as with a person, people will either come to trust you or distrust you.

And with trust, comes an increase in perceived value.

Take a look at the image above – both examples are the same product (a tin of beans) and yet they both appeal to different purchasing groups.

Heinz beans are perceived as being better quality because the Heinz brand has worked hard for years to establish this connection with their brand.

The Tesco value range is branded as everyday value for the normal shopper – a way to save themselves money.

If asked about the perception of the brands, people generally respond that the Heinz beans are better quality than the Tesco ones, but that the Tesco ones are better value for money.

Note that the lesson here is not that one branding process has been more successful – they both have – they are just trying to capture different market shares. These two brands are not even in competition with one another.

Heinz is after the market that values quality more than price concerns, and they do it very well.

Tesco is after the market that wants better value for money and prize cost over quality, and they do this very well.

Both brands are winners here.

(It is perhaps prudent to add that we are in no way saying that Tesco beans are lower quality, but that this is the perception of a majority of customers, due to the different branding strategies of the companies).

By building their brands to capture their desired markets, both brands have substantially increased their business over time.

Or, to put it another way, we came across this image doing the rounds on LinkedIn, which sums it up perfectly:

Consistency

Good branding is an indicator of consistent quality. Although these values are intertwined, this is a separate benefit from value perception and should be appreciated as such.

Value perception mainly wins new customers, consistency is what keeps them buying.

Being satisfied with the quality of a product and knowing that each subsequent purchase will always be as consistently good generates additional future sales thanks to the “if it ain’t broke, don’t fix it” mentality.

In other words, if a customer is satisfied with a purchase, why risk disappointment by shopping elsewhere next time, when there is a chance that they may be dissatisfied with the other brand?

This is a powerful sentiment, which overlaps to a degree with brand loyalty, as it is consistency that develops loyalty in the first place.

But imagine how easy it is to lose a customer for good through one bad experience; in other words, if the consistency is not there, it will cost you in lost sales.

But if the value, quality and consistency are in place, then this buys your brand loyalty and will win you extra sales.

Loyalty

Once you have gained customers through branding and being consistent, you’ll want to keep them.

Brand loyalty is big business. Just ask Pepsi.

Despite having a hugely successful marketing campaign over the years, and despite having a product that is as good as its main competitor, Pepsi simply cannot steal the #1 cola title from Coca-Cola.

What Coca-Cola have done so successfully is develop their brand loyalty to a point that it is almost unshakable; for many of its customers, it’s Coke or nothing – no other cola is good enough, and this is no accident.

Brand image and loyalty enables strong education of the customer – and this impacts consumer behaviour. Coke drinkers believe that Coca-Cola is better simply because it is Coca-Cola.

Consumers often buy products based on brand image, and as brand marketing has developed, this trend has only grown stronger.

That is why there are consumers who will buy every new iteration of the Microsoft X-Box, even as they may admit (to themselves) that the Sony Playstation is better.

It’s why Apple customers who own an iPhone are far more likely to own an Apple Mac computer rather than a generic PC. In fact, Apple is arguably the best company for developing customer loyalty in the world.

Now, in 2020, they have launched a TV channel, new hardware and software, an upgraded news service and financial payment card services. They know from experience how many sales they will get from their existing customer base, purely due to brand loyalty – and no other reason.