Question

QUESTION TWO: At the annual conference of the Ghana Association of Microfinance Institutions, it was established that branding is the key to build consumer confidence.

Discuss the relevance of branding in micro finance industry?

Answer 1

Brand is a name, design, symbol or any other feature which distinct a product or service from other products. Brands are perceptions or attitude of people towards the products. Branding is the process of putting or disseminating a brand name for the products.

At the annual conference of the Ghana Association of Micro finance Institutions, it was established that branding is the key to build consumer confidence.

Discuss the relevance of branding in micro finance industry?

If micro finance institutions use a brand name, it creates a trust in the mind of the customers regarding their products. Brand reflects how the market perceives the personality of the micro finance institution. The following are the advantages of having a branding:

• Facing competition by providing recognition to the products : When other micro finance institution (MFIs) provides similar services it is essential to establish recognition of the products in the market. Then only the customers will be attracted
• Mobilise savings : A strong branding always create trust in the mind of the customers regarding the MFI. It will enable them to mobilize savings from the public to the company
• Maintain market leadership : Branding is essential to capture the market share in the market. When the institution can attract the customers, it will increase the market share and it will become the market leader
• Marketing efficiency : Marketing process will be efficient if a MFI has a brand name in the market. It makes easy to reach to the customers. Marketing efforts will not be effective if there is no branding
• Build credibility and goodwill : Credibility among the customers is an important factor to increase sales. Credibility can be built through effective branding. Thus MFI can improve goodwill also

In short, the success of MFI lies on its branding. When there are many competitors in the market, it is essential to have a brand name. Thus branding is relevant in a micro finance industry.