A simple easy way to make armbands is let's say you have 3 different main colors 3 different patterns and 3 background colors. It'd be great to help identify groups and your teamates!
#Armbands!
silent island
light sail
Teammates show up with green names you can see on your map
I think flags or signs or something that work how you described could be cool to mark bases but I don't know if it'd be super useful for identifying players at anything other than super close range
If anything I'd think colored armor would be more useful for that