Branding and brand management have been used in the hotel industry for many years Due to ongoing factors such as globalization and technology, there has been huge competition in this field. In the last decades, many hotel companies have realized the importance of differentiating themselves from the competitors by presenting a product or a service that is conspicuous to their guests (Banerjee, 2007). Hotel companies have developed new and different product brands as a way of increasing customer satisfaction and gaining their trust. Therefore brand management is a very crucial factor in the hotel industry in order to be competitive. This study will, thus, explain the complexity of brand management by defining a brand, branding, brand equity, and brand management. The study will also evaluate the importance of brand management to customers and the organization (Chang & Ma, 2015).
According to Sicard (2013), a brand is the product image that attracts and convinces the buyers to purchase that particular product. It is the mark of quality and the assurance to the customers that what they are buying will meet their expectations. A brand can also be defined as the unique identity of a product that reflects the company’s objectives, mission, and vision statements using either graphical or verbal tools. Typically, a brand shows what a company is and what it does. There is a wide variety of literature discussing brands such as brand mark, brand mark, logos, and trademarks. Additionally, brands became the most important assets for an organization. This change lead to immediate reactions and problems were solved using ideas receives from different departments in the organization. However, the approach used during this period was also faced with some challenges. One of the disadvantages is that in most cases, management often lacks expertise in various departments within the management. This means that a specific department lacked the necessary skills needed to accomplish a branding strategy and this affected the overall success of the brand (Banerjee, 2007).
Branding is a term deducted from the word brand which means differentiating or marking a product. The primary purpose of branding is to show the buyers what the product is, what it is for and the reason why they need it (Kwun, 2012). Apart from providing customers with knowledge about a product, branding also assists them in the decision-making process and at the same time helps the company create loyalty with the guests. In the hotel industry, branding is considered as a significant tool since it assists the guests to choose a hotel where they will get quality services and products.
Brand equity can be defined as the value added to a product after branding. Brand equity tries to compare the results of a product when it is branded and when it is presented to the customers without a brand name. Brand equity gives the importance of providing a product with a brand name to distinguish it from other products in the market (Bowden, 2009).
Brand management is the art of creating and sustaining a product brand in the market. It is the process of improving, positioning, and creating awareness of a product as a way of giving the business a quality image to the public. Brand management is a broad topic that involves marketing, customer satisfaction, the cost and the competition in the market (Tanaka, 2012). Mostly, brand management is associated with marketing strategies where it is concerned with managing both the physical and the intangible features of a product.
These features include the price, packaging, the nature of the product or the service itself, customer experience, and customer feedback. Brand management revolves around creating products that will perfectly fit in the market and attract more customers and the same time, create loyalty with the customers. An effective brand management process involves using creative ways to manage the brand equity in the market, increase the brand awareness, develop new brands, and strategically position a brand in the market (Chevalier & Mazzalovo, 2012).
Importance of brand management to the consumers and the company
Although brand management is a practice by the company to gain customers loyalty and trust, the exercise is also beneficial to the customers as well. The hotel industry is one of the fastest growing and changing in the world today. The companies are subjected to a high pressure of customers demand and supply of quality services (Wang, Zhao & Deng, 2011). Due to the current trends being experienced in the world economy today such as competition, globalization, market concentration, and technology, hotels are forced to go an extra mile to ensure that the services they offer to their guests are different in a unique way from those provided by the competitors in the same industry.
One of the most critical trends in customer demand is the increasing demand for late hotel bookings and shorter holidays. People are now travelling to new places every day on the weekends and holidays. Therefore, for hotels which aim to accommodate many of these people, keeping a record of their guest’s behavior is very crucial. Recently, customers’ demands and expectations are very high than never before. For hotel guests, enjoying is not just enjoying anymore but it is more of personal value gained from a service. People have high demands for extremely high-quality services and at the same time, they expect the price they pay to be favorable. In this case, hotels have been forced to come up with new products and brands to accommodate these changes in customer demands (Jenifer, Divya & Suganya, 2011). For instance, the Rosewood hotel operates suites, spas, and other amenities using the same brand name to cater for their guests in Asia and other countries where they operate.
Benefits to the Customers
Customers benefit from brand management in that it is easier for them to decide on which hotel they want to be accommodated in during holidays and other functions. Branding assists the clients with the relevant information they require concerning the services offered by a hotel. Naturally, people tend to buy products or acquire services from a company based on their experience (Walton, 2010). For instance, a person who travelled to Asia and was accommodated at Rosewood hotel severally must have adequate information about the quality services offered by the hotel. If the person was served well, most likely, he/she would seek accommodation in the same hotel the next time they visit there. As earlier mentioned, a brand is a mark of quality and clients have confidence choosing services from a particular hotel may be from previous experience or available information presented to them. To a consumer, product brand is a significant risk reducer especially if there is a specific price, type and it is relevant to the client (Bowden, 2009).
Take a scenario where a tourist has visited Asia for the first time. For this tourist, it may be a challenging task to choose among the many luxury hotels that are found in the country. It happens that this client has heard about Rosewood chain of hotels from friends and other people before because Rosewood is a brand name that is known worldwide. In this scenario, the tourist is most likely to choose this hotel to reduce the risks of being accommodated to a hotel that he does not know about. Besides, branding gives the consumers a sense of belonging because there is pride that comes with being associated with famous brand names (Kwun, 2012).
Benefits to the hotels
The apparent importance of brand management to a hotel company is that it distinguishes its services and products from those of the competition. Although there are many luxury hotels in Asia which offer the same products, the way Rosewood has branded itself gives many people who visit there a reason to choose it over the rest (Kwun, 2012). One of the distinguishing brand features that make Rosewood Hotel outstanding and favorable to clients is its combination of different cultures and histories. Brand management increases a company’s market share thus a competitive advantage. Through branding, a hotel company can reduce the risks of customer dissatisfaction because customers expect nothing but the best. When hotels clearly define the nature of services they offer, it becomes more comfortable for the guests to choose what they want because they know how the services are provided and how much it will cost them (Banerjee, 2007).
A case of Rosewood Hotels
Brand management has been the focus of research in many hospitality and tourism studies. The primary purpose of this study is to analyze the emergence of brand management and how it has evolved since then using the case study of Rosewood Hotel. The focus of this topic is the evaluation of brand management activities of the hotel under investigation. Brand management plays a crucial role in the hotel industry by maintaining long-term relationships with the clients. Rosewood Hotels and Resorts is a luxury brand of Rosewood Hotel Group (Net, 2018). The Rosewood Group of Hotels is a member of New World Limited which was founded in 1970. The New World Limited which became public in 1972 was initially operating in Hong Kong but since then, it has been expanding to other parts of the world including Asia, North America, Middle East, and Europe.
Rosewood which has been operating for the last 30 years believes in the creation of new properties and brands through increasing its presence in different countries. For those years the hotel has been operating, they have redefined their hospitality services creating classics and properties such as A Rosewood Hotel in New York, A Rosewood Resort in Los Cabos, and Rosewood Little Dix Bay in the Virgin Islands (Net, 2018). The company has a total of 18 properties in 8 countries and they are seeking to launch new exciting projects under the Rosewood brand in the coming years. Rosewood is a brand that is built on reputation and public relations, advertisements, online marketing, and trade show events continuously reinforce it.
Evolution of Brand Management
Branding is a practice that has been around for a long time. However, the practice has been undergoing changes from time to time due to changes that have been experienced in the world. Some of ancient Greece, Indian, Chinese, and Roman, artifacts, carvings and pottery dating back to 1300 B.C have brand marks on them. This section explains the historical evolution of the subject under discussion through a brief evaluation of six eras it has evolved. Different approaches were used in each period to manage brands depending on the changes experienced at that particular time and other factors (Quester & Fleck, 2010).
This is the period between 1849 and 1899 which was mainly characterized by the industrial revolution. This era marked the beginning of modern branding methods because of changes in production processes. Other factors that influenced the developments experienced during this time are improved transport and communication systems because they facilitated distribution of goods in large quantities and in large areas (Veloutsou & Guzman, 2017). As a result of all these changes, there was the emergence of local institutions which served as the link between the customers and the producers. They came up with new packaging methods which packed products in individual packets as opposed to bulk containers that were used before. The increasing competition and lack of contact with the customers made companies to mark their goods. By the time this century was coming to an end, most of the countries had started to use trademarks as a way of protecting company brands (Sicard, 2013).
During this time the focus shifted from manufacturing to production where branding started to be used as sale instrument. This period began from the late 20th century and lasted up to mid-1960s. The fact that goods were more exchanged during this period manufactures wanted to win customers trust and retain them (Quester & Fleck, 2010). They came up with other means of distinguishing their products from those offered by others in the market. For the first time in the branding history, a brand name was officially defined during this era.
The period after the 1960s, customers had to come up with ways of overcoming the challenges that were significantly affecting their profitability. This period was marked by economic recession and advanced technology and this two increased competition like never before. The market was now concerned more concerned with buyers than sellers since supply exceeded demand and the market was saturated (Veloutsou & Guzman, 2017). Manufacturers had to change their ways of doing business because customers had more choices in the market and could compare a variety of products and choose what met their expectations. Brand management started to be used as a dynamic customer based experience where marketing methods such as pricing, distribution, and research were included in the business planning (Sicard, 2013).
In the mid-1970s, a new strategy of managing brands was developed due to the realization of how product brand influenced customer behavior. Producers started viewing image as the center of successful brands. Based on the research on what had happened in the previous eras, a conclusion was made that all marketing approaches affected the brand image. As a consequence, brand management was linked to marketing and brands and branding management was handled by the marketing department since then (Quester & Fleck, 2010).
A lot of attention was given to brand image and the importance of brands in organizations was put into consideration. Assigning the marketing department the full responsibility of handling brands have been criticized though on the ground that excluding other departments from the exercise has its disadvantages. The disadvantage of using image orientation approaches is that they completely ignore the internal factors that affect a brand and focuses more on the external orientation. The problem with this strategy is that the customers influenced the product brand image and this consequently led to lack of uniqueness and consistency in the images (Sicard, 2013).
Strategy orientation era
During this era, there was more emphasize on the brand image but this time, a brand value included the user and the product itself. Typically this era was developed in efforts to compensate the significant deficits of the image-orientation era. Stronger approaches were used which focused on brand management as a whole rather than just changes in customer preference. The thing that changed during this time is that managing brand was made the responsibility of the whole management team instead of marketing department alone (Sicard, 2013). Additionally, brands became the most important assets for an organization. This change lead to immediate reactions and problems were solved using ideas receives from different departments in the organization. However, the approach used during this period was also faced with some challenges. One of the disadvantages is that in most cases, management often lacks expertise in various departments within the management. This means that a specific department lacked the necessary skills needed to accomplish a branding strategy and this affected the overall success of the brand (Banerjee, 2007).
Another significant discovery about brand management was made in the early 1990s where there was a belief that brand possessed human characteristics. The previous periods saw the loss of customer trust to a significant extent and so managers came up with an idea of developing a unique brand personality that was similar to human beings as a way of reestablishing customer trust (Sicard, 2013). Globalization and advanced technology had reached the peak during this time and this meant that competition was at the highest level. From this time henceforth, brand identity and consistency became the basis of brand management and it is being used up to date (Banerjee, 2007)
There are several keywords in brand management. But the definition of the terminologies begins by defining brand itself. The American Marketing Association defines a brand as the name, sign, symbol, design or all the above with an intention to spot the products of one seller and distinguish them from other sellers. This is the old version, one that necessitates the need for visual identification and vivid external factors related to organizations and brands. This has been the definition held by leaders and other stakeholders. This is the traditional definition; it needs to evolve so it can fit the company dynamics in the economy today.
In light of that, Malmelin and Jukka Hakala who argued that the definition provided by the AMA is understated offered a new definition. Their definition goes like this, a brand is not just the tangible parts of a product, a service or an organization but within them are many more intangible factors that are next to impossible to quantify (Foroudi, Melewar, & Gupta, 2017). An even more radical definition claim that brands are not just a marketing or advertisement idea but rather brands have grown to be all the things an organization does.
This article will define branding as the personality, the behavior, functionality and the quality of a product and the promises put in place by the company to its customers. It is both the visible and invisible characteristic portrayed by a company to attempt to create a fruitful relationship with its clients to promote customer motivation (Aycan & Lorenzoni, 2014). This is done with the hopes that the motivation will keep the customer coming back.
A successful branding tool is an organization's means of interacting with its environment. A good brand has a lot of reaches; it can be a tool for an investor to learn the future profitability and boost the value of the company financially (HWA, 2015). To get a sense of branding, take the example of The Taj Mahal Palace in India, it has a lot of meaning in the financial world and provides a range of products all of which are related to their brand. Whether it is consumer products or corporate products or both, they add the same elements and use the same branding technique for all of them (Spring, 2013).
Components of a brand
There are several components of a brand where a organization can chose from. These include corporate culture including the everyday norms, regulations, and behavior within the company. Since the brand involves everything to do with the company, the culture in the company has to reflect on the brand being promoted (Baumgarth, Kaluza & Lohrisch, 2016). Employees are the first point of contact with a customer, they bear the reputation of the company with them. A customer is looking to book a room interact with the employees first. In other words, they are bearing and promoting the brand of the hotel, at least at that moment.
Communications- The aim for many companies today is integrate the market with communication so that every part of the company (including its message) is in tune with the brand. The leadership is also responsible to control and promote the brand through their actions. It means that the CEO and top leadership of a company should at all-time promote the brand of a company in their actions and decisions. All they do has to be in line with the brand of the company/////. Reputation is also a vital aspect as it is easy to confuse reputation and brand; they are close but not the same thing. Reputation is the result of branding. The reputation can be positive or negative depending on the success or lack thereof, of the brand. Reputation signifies that there is a discussion about the company. Therefore, it can be used to evaluate the performance of a brand.
The company image and visual identity, as discussed earlier, this is the basic definition of branding. It is an important component of branding. Visual identity is the fonts, logos, and website for the company and cannot be confused with the image; the image is the projection of the company to the rest of the business world. Products- in the past people believe that brands were the products made by a company. But it is actually all the things surrounding the company. But products are still very important. A company will make promises which the customer is going to check and confirm when the product finally launches. Other important keywords include;
- Awareness-This is the size of the market that are conscious of the existence of the brand. There are two types of awareness: spontaneous (quantifies the number of people who will mention the name of a company if asked to name brands in particular industry) and prompted (people who will recognize the brand is shown within a list).
- Brand architecture- This is how a company organizes and identifies its brands within its portfolio. There are three main types of brand architecture: endorsed- where all the other sub-brands are related to the main brand through endorsement by the company, monolithic- all the products bear the company name and freestanding- where the company acts just a holding company and each product are targeted just on its good brands.
- Brand association- The information a client has about the company. The information here is based on customer feedback and must always keep the brand position.
- Brand Equity- This refers to the differentiating sum qualities of a brand gotten from stakeholders that motivates commitment and demand for the brand. This increases the value of the brand
- Brand commitment/ loyalty- It is the motivation that will persuade a customer to return to their brand. It shows how much a brand is protected from its competitors.
- Brand earnings- There are share capitals that can be followed back to brands alone.
- Brand Extension. This is the process of going through the brand portfolio to ensure that all products with the brand occur in particular similarity like name, visual identity and ensuring the right positioning for the right consumer market. This is known in industrial terms as brand harmonizing.
- Brand identity. This is the outward characteristics of the brand, the name and how it looks. It is arguably the most important part of the brand since it is the customer's means of recognizing a brand and learning to differentiate it from other brands.
- Brand image- This is the client's response to the brand. For most clients, this is usually involved in an up close and personal view of the product. From how it looks to its price to how well it satisfied their needs. For the less informed, this process is reliant upon uninformed opinions and beliefs.
- Brand licensing- The permission offered to the brand owner to acquire and use the brand of a different film. A small royalty is agreed in this circumstance.
And from all the Branding information gathered, brand management can be defined as the tangible and intangible features of a brand (Quinton, 2013). In the case of product brands, the tangible part is the product packaging and the product itself while in the case of services, the tangible is quantified using client experience.
History of Brands Management
Brands have a very long way, as far as ancient Rome. Back then, one of the ways of getting rich was through selling pots. Since making pots was very simple, it means that the supply was staggering (Baumgarth, Kaluza & Lohrisch, 2016). Everybody could make a pot and sell it. The only difference and the determining factor was the quality. Brands from different craftsmen were different. And since people could easily see the difference, the craftsmen started engraving their signature to their pots as a means to separate them from other pots. This is the simplest form of branding. It was in this times when the first brand loyalty was also discovered. To answer the question why did people go for a certain kind of pot? Because they knew the signature and was sure, the quality would be good.
The roots of branding clearly go back as far as the ancient Roman times. A brand is something that people see and relate to certain values. But just because branding goes back to ancient Rome, does not mean that the process of brand management has not evolved. Brands are tools that are used by companies to compete only in the recent past (Mitchell, Hutchinson & Quinn, 2013). The original investment into brand management was seen first in 1870 when the rules of trade changed and allowed companies to preserve their brands. This way companies could prevent any other person from stealing their brand (Hanna & Rowley, 2011).
Some of the companies with the most recognizable brands are Nokia and Google. They managed to score highly in a study conducted by Interbrand. The question then becomes how they managed to stay that high. One of the components of a traditional branding strategy is company age. Older companies that have gained footing with time are well branded and trusted by customers. That is true for the most part but some of the hotels in Asia are not that old, so what about them? This paves the way for the next factor, the information age. Society has switched to an era of information and the internet where anything is readily accessible if you want it hard enough (Hanna & Rowley,2013). News travels fast. And companies are able to use this information when branding their products.
Theories: Holistic vs. Traditional Approach.
It is undisputed that branding increases the chances for customer loyalty. If all the items in a supermarket were generic, then clients would not know to stay loyal to a single item and companies producing high-quality products wouldn't get a means to create customer loyalty or have return customers (Junghyun & Eun Ah, 2016). A big number of people blame big multinational organizations for unfair markets, but branding argues that all companies now have the chance to be advocates for their own brands and that the level of their success can be attributed to their branding strategies (Ertimur & Coskuner-Balli, 2015). The communication within the company has to be flawless, between CEO and employees or employees to an employee; communication should be perfect. This makes sure that the brand being sold is known to everyone, to get the entire company project the brand it is trying to sell. Every employee is a part of something bigger, the brand. Therefore each contact with the customer is very important and reflects the whole company. This makes communication a big part of holistic theory brand management.
Most companies in many industries have tried to maximize their output by minimizing the cost of production. But the most effective way to achieve cost leadership is through differentiation strategy. It is the most customer-oriented method. But that is the traditional method. According to the holistic approach, brand management is the best way to run a company (Cengiz & Ersoy, 2017). This view has changed how brands are managed. Traditionally brands were managed by focusing on a single part and making that part right, but today, the holistic view has evolved brand management into the lifeline of the company. It is what the company stands for, what it lives and breathes (Vaziri & Beheshtinia, 2016). This view demands companies to understand that if they want to realize their goal, they must create and nurture a brand undisputed and the person who embodies this change is the CEO and every other employee no matter the rank.
Previously brands were associated with the marketing department, and the sole method of showing brand was via adverts (Pecot & De Barnier, 2017). This created the illusion of brands having a nearly immeasurable benefit. The traditional theories would also consider branding to be too expensive for the company and therefore were an unnecessary risk. And even now when things have changed, that idea still lingers around in some companies. They fail to see the role branding plays in the world today. Today even they hiring employees has something to do with the company brand (Choi, Ko, Kim & Mattila, 2015). Employee hiring considers the character of the company and finds a match with people who best fit the company profile and personality.
The holistic view named communication as an integral part of the brand management process. Everything in any company today is done only via communication and brands communicate with various customers. Advertising is one of the methods of telling your audience about your brand (Quinton, 2013). The main role of advertising is not to increase sales but to improve on the salability of the company brand (Baumgarth, Kaluza & Lohrisch, 2016). Meaning all adverts do is to tell people, in a positive way, about the company. It all starts internally. This is because internal communication and procedures bear a big effect on the brand portrayal externally. Meaning, for a firm to make and keep a successful brand, it all must start from within.
In conclusion, Branding has come a very long way, and the major driver has been changed. Communications is a good agent for sustaining long-term equity. As mentioned earlier, its major function is not to create a short-term profit but to make a significant impression on the consumer that it stays for a long time. This creates arrest space for companies for it makes customers support the brand. The biggest audience for branding are shareholders (who wants to know how they will keep making money), stakeholder and potential investors, for them, a good brand pays for longer.
The share price of a firm is determined in the market; the market has shareholders, consumers, and investors. A good example of the benefits of branding is Apple. It has developed such a brand that the share price has always steadily increased. Their secret is communication. The hotel business is booming in Asia; the market is very big. Several other international hotel chains are entering the market, meaning, more competition for the customer base. This is where branding comes in, ensures a knowable identity for the new and existing hotel in the entire market. It is an identity that ensures the correct value, quality, functional and emotional benefits and motivation in the product's name. This is the essence of brand management. Pairing client expectation and the sum knowledge of the firm and the produce. Making a commitment and staying true to that commitment is the secret to brand success. As previously mentioned communication is the key to internal branding harmony.
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