Impact of Branding on Consumer Perception and Buying Behavior

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CHAPTER 1

INTRODUCTION

1.1 BACKGROUND OF THE PROBLEM/STUDY

Branding is one of the most important aspects of the marketing arena. In this world of ever increasing competition and removal of barriers to trade due to the enforcement of the WTO (World Trade Organization), branding has become even more important. In a situation where a multitude of alternatives are available to the consumer at lower prices, the establishment of a strong brand name is extremely important.

A strong brand can make all the difference between a successful brand and a failure. Branding is at the heart of marketing. The reason for this statement is that marketing should not only be about meeting needs but also about fulfilling expectations. Marketers strive to create strong brands that can sustain themselves over the years and from generation to generation. Brands like Coca Cola and Marlboro have been around for decades and their appeal is still massive all over the world. Through advertising and other marketing means, companies try to form favorable consumer perceptions about the brand. These perceptions are very important as it does not matter how strong the brand is in actual terms but what is important is the perception formed about it in the consumer mind. This perception, whether accurately reflecting the products features and attributes or not, is the motivation behind consumer buying.

A successful branding effort should ideally eliminate price as a contributing factor to buying behavior. However, in certain types of competitive markets, the market dynamics are such that price again comes into play and the players face the danger at worst, of price wars, and at best competition where consumers are making decisions based on price. Branding is by far one of the most important factors influencing an item's success or failure in the marketplace, and can have a dramatic impact on how the "company behind the brand" is perceived by the buying public.

In other words, the brand is not just a representation of a company's product; it is a symbol of the company itself, and that is where the core of brand loyalty lies. The Pakistani cellular market is going through such a phase where the players are trying to form perceptions through advertising and may even eventually succeed. This paper discusses branding and its importance, how brands affect perceptions through advertising and ultimately how consumer buying behavior is affected. It also discusses through a real-time example of the Pakistani Telecom sector how branding loses its edge and the price enters the equation again.

1.2 STATEMENT OF THE PROBLEM

The aim of this study is to explore that to what extent branding affects consumer perceptions and consumer buying behavior: A study of Pakistan cellular companies.

1.3 OBJECTIVE OF THE RESEARCH

The research study focuses upon:

To determine the impact of branding on consumer perception. •To findout the impact of branding on consumer behavior.
To evaluate the benefits of brand equity through branding products. •To ascertain that how an organization or company gets maximum loyalty through strong branding

1.4 THEORETICAL FRAME WORK

Dependent Variable:

Consumer perception.
Consumer buying behavior.

Independent Variable:

Branding .

Independent Variable Dependent Variable

Figure 1.1 Theoretical Frameworks

There are two major dependent variables considered in research study includes Consumer Perception and Consumer Buying Behavior.

1.5 DEFINITIONS OF TERMS

Brand: An identifying symbol, words or mark that distinguishes a product or company from its competitors. (David Aaker, 1991)

Brand equity: Measures the total value of the brand to the brand owner, and reflects the extent of brand franchise

Consumer Behavior: The study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose...
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