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If I mention the word "cola", what is the first thing that springs into your head? You're probably thinking of Coca-Cola or Pepsi even though there are Hundreds of other cola drinks on the market.The reason you though of those two companies is because they spent hundreds of millions of dollars over the years building their brands, and it has paid off.
The keyword here is Branding. Branding is what differentiates one product from another of a similar make. For instance, what is it that differentiates Sprite from the other lemon soda drinks? Apart from minor changes in the ingredients, the only thing that is actually different is the name - the "brand".
A good brand name is a powerful force in economics. It often means that the company who owns it can charge more for their products because consumers perceive the branded product to be of better quality than an unbranded or rival product. Branding is also what causes people to think of Coca-Cola or Pepsi whenever "cola" is mentioned.
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