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My fast definition: Having your logo/slogan in front of as many people as you can in a consistant way.

Branding is critical part of your business design. You shouldn't need to travel further than your front room to discover this. On your television you witness scores of advertisments from Pepsi, Coca Cola, and Nike. These entitys don't stand in front of you and attempt to tell you the reason their goods is better than their competitors during the short commercial, their main objective is only brand recognition. What they are trying to do is make you grin and possibly express joy during their commercial.

A little while back I saw a marketing seminar by Hobbs Herder, a real estate marketing juggernaut. They suggested marketing the feelings a brand gives you, not just the product. In Any Event they told us a little fact which has adhered with me since then. Coca Cola was the best soda company at the time (I don't have any idea what year this takes place), and they needed to test something. They were certain that Coca Cola brand was so big and everyone drank it in Atlanta, their home base anyhow. And So they stopped billboard advertising around town. Right away the sales numbers dropped, which is zillions of revenue to Coca Cola. I don't have any proof of this, but I recall it vividly. After Coke realized a instant fall in people purchasing their product, they rapidly restarted marketing and their numbers went back to normal.

That story just illustrates how essential branding is. Sure you want a good logo and good marketing program as well, but I think continuous exposure to your clients is primary.

As far as your logo for your business, you should strive for something simplified, clean, easily reproduced in as few colors as possible, and appears great in all sizes of print. Virtually all websites own an icon which becomes saved to a web browsers computer when they bookmark the site. Likewise if you are looking at a page, your browser shows what's known as a favicon to users. This favicon should be a picture you want related with your business. The trouble it only is permitted to be 16x16 pixels. That is really little, so you want to be certain your logo can scale down cleanly.

Once you settle on on your businesses colors, logos, mascots, or what ever it is you use to get clients to recognize you, LEAVE IT ALONE. It's just like in in search engine optimizing, if you own a web page that's famous for the keywords "Drupal, Business, Website" then all your customers (Google, Bing, and Yahoo) recognise you by those keywords. If you go and change them to "Cheap Websites, Fast Web Sites" then they won't send you the same traffic they would before. All the same, if you plant a brand in consumers mind, they acknowledge you by that brand, and if you go and alter it too drastically, you might risk losing some loyal followers. 

Once More, Coca Cola has not varied their logo EVER, while Pepsi has revamped theirs multiple times costing tens of millions of dollars. That's just one example, I acknowledge there are occasions when converting a logo might be needed, but if you can pick a simple, elegant, clean logo, it can stand the test of time and you won't want to revamp it every 6 years.