I've put together a short and interesting article about web branding at http://www.mckirsch.com/articles/website-branding-guide Sergey Brin, one of the founders of Google likes to say that Google actually relies on its users to help with their marketing. Google has a very high percentage of users who often tell others about their search engine. Yahoo!, MySpace, Hi5, YouTube, Amazon... Remember Napster? Apple started as a garage computer production. BUT, having a good product (website, service) wont make you a brand. It is just a must, a base for your marketing and branding efforts.
I beleive Its your products that brand you initially (unless you have millions to spend on branding). With one of my sites which isn't doing very well yet..(not in the top position for my targetted keywords)...I get around 20 referrals from people searching my brand name in google...It's really great IMO...but I honestly have not spent a single cent in marketing or advertising that site...I believe if you provide them something good, something exceptional...you gradually get auto-branded.. Just my thoughts though.
I think the argument that product or service develops a brand is fairly valid. For the most part I see the old school branding methods as obsolete. On top of that, branding is far more valuable than it is expensive. When we think about Coke's branding being worth $20m, it probably is (or what ever ungodly number it really is worth), but maintaining, acquiring and worth are all different values. MySQL for example spent nothing on their "branding" (heck even their logo was given to them), but their branding is worth a great deal right now, and they are in the position of having to maintain it... which cost more than getting it, I'll give odds on that. The horror stories of massive costs in developing brands (not maintaining them) are usually surrounding companies that don't have a real service or product worth talking about. Cox Cable is probably a good example. They came into a market that was already saturated and branded up the wazoo, and had to go to market-war to develop a brand, and then defend one. Google came into existence when there were already several branded search engines and quietly went about being the best one. They branded by not branding (white page, search box, one button and a silly name). Digital Point, this forum, has branded by having a good idea. There are plenty of web master forums out there an a lot of them are better than this one (no offense, I say they let me in here, so how good can it be? ) I've never seen an ad for Digital Point, and I don't use any other service of theirs, and yet here I am, and I've told several of my clients about the place. The first rule on the Internet is "make the user do it", and I would suggest that market branding is no different. If you can figure out a way to enlist your users to your goal, then you won't throw money at the problem, or if you do the ROI will be worth it.
What we've found is that your brand cannot just be a made up catchy phrase, but it has to be something that you believe in and live, a lifestyle! It dictates how you do the smallest internal processes all the way up to everyday client communications. If you don't believe it and live it, then clients will soon see it was for not. "Talk Big and BACK IT UP" MadBrook, Inc.
This reminds me of something Hugh MacLeod talks about in the Hughtran Manifesto, I'll try to extract the relevant bits here: The new companies who get the whole "market as a conversation" thing understand that things like AOL's "The Call" fiasco or Jeff Jarvis' customer service problem with Dell make the internal problems of your company transparent, whether you want them to be or not. Before the Internet, these things didn't spread as quickly or as far. If you're not honest with your customer, they will find out - and react badly. You can't fake it any more. These days a catchy jingle and fancy TV commercials aren't going to help if you don't treat customers well.