Unit 1 Brand Management KJC
Content
Introduction to brand management
Dr.S.Yogananthan
Contents Introduction to brand Functions Characteristics Relationships Brand Identity & Image Difference & Parity
What is a brand?
A name, a term
A symbol, a sign
“A name, term, sign, symbol or any other feature that identifies one seller’s product or service as distinct from those of other sellers” -The American Marketing Association
Brand can be Logo – shortcut to remind Colours Shape Letter Images Tunes Phrases Celebraties
Functions of Branding Helps in Identification and gives distinctiveness to the product Indirectly denotes quality and standard Eliminates Imitation Ensures legal right to the product (Trademark, patents, copyrights…) Helps in advertising and packaging Helps in price differentiation of the product
Characteristics of a Strong Brand Brand name should describe its nature Easy to remember and pronounce Act as a stimulating trigger to customers Brand portfolio and hierarchy should make sense Brand should properly positioned Brand should be consistent Brand should be given continuous support and monitoring
Scope of Branding To teach the customers the following:-
1. 2. 3.
“Who the product”- name, other elements “What the product does” “Why the consumers should buy”
Brand relationships FIRM Brand identity framed by marketers
INTERACTIONS
CUSTOMERS
Brand relationships
Brand image in the mind of customers
Branding process Brand the actual image of the firm in customers’ minds A new definition based on Brand relationships: Brand is created in continuously developing brand relationships where the customer forms a differentiating image of a product or service based on all kinds of brand contacts that the customer is exposed to.
Brand Identity is what the owner wants to communicate to its potential costumers.
A unique set of associations in the minds of customers concerning what a brand stands for and the implied promises the brand makes.
The importance of image Image communicates expectations Image is a filter influencing perceptions of the performance of the firm Image is a function of expectations and experiences
Image has employees
an
internal
impact
on
Image and Identity
Sending
Media
Brand identity
Signals transmitted
Receiving
Brand image
Competition And Noise
Contd.. BRAND IMAGE is a unique set of associations in the minds of customers concerning what a brand stands for and the implied promises the brand makes. BRAND IDENTITY is the strategic goal for the unique set of associations that a brand should stand for. These associations also imply a potential promise to customers. PERCEPTION GAP.
Brand Hierarchy Brand Hierarchy is how an organization organizes the various named entities within its portfolio, and how they relate to each other. The four general types of Hierarchy are: 1. Master brand : Maruti Suzuki 2. Brand/sub brand : Maruti 3. Endorsed brand : Maruti Esteem 4. Separate (stand-alone or independent) brands: LXi/ SXi
* http://www.interbrand.com/best_global_brands.aspx
Brand Positioning Brand Positioning
“Positioning is how a product appears in relation to other products in the market” Brand positioning is all about identifying the optimal location in our customers’ minds for our Brand vis-àvis with our competitors Proper positioning makes it easier to facilitate understanding of our Brand
Developing a Positioning Strategy Positioning is not what you do with a product but what you do in the mind of the prospects. Positioning requires determining the frame of reference by identifying Target market Competition POP’s and POD’S
Category membership
Starting point in brand positioning is to determine Category Membership. Category membership is product or set of products with a brand competes and which functions as close substitutes Three main ways to determine category membership: Announcing category benefit Comparing to exemplars Relying on the product descriptors
Target Market Consumer Aggregates Current users Potential users Competitive users Consumer Segments Behavioral Dem/psych/geo
Points of Difference & Parity Difference Strong, favorable, unique Attribute or benefit Parity • Shared with other brands • Important for brand extensions
POP’S Point of Parity (POP) Two Types Category : attributes that are required to include your product as a member of that category. Competitive: POP’s that negate your competitor's POD’s POP’s should be “good enough” but POD’s should be superior
Choosing the differentiating strategy
Product differentiation Personal differentiation Channel differentiation Image differentiation
Choosing the pop’s and pod’s Relevance Distinctiveness Believability Feasibility Communicability Sustainability
Proper Positioning Clarifies what the Brand is all about How it is both unique and similar to competitive brands Why customers should purchase and use the Brand
5 Factors of Brand Positioning
1. Brand Attributes : What the brand delivers through features and benefits to consumers. 2. Consumer Expectations : What consumers expect to receive from the brand. 3. Competitor attributes: What the other brands in the market offer through features and benefits to consumers. 4. Price : An easily quantifiable factor – Your prices vs. your competitors’ prices. 5. Consumer perceptions: The perceived quality and value of your brand in consumer’s minds (i.e., does your brand offer the cheap solution, the good value for the money solution, the high-end, high-price tag solution, etc.?).
The Process of Positioning
Generally, the product positioning process involves:
Defining the market in which the product or brand will compete (who the relevant buyers are) Identifying the attributes (also called dimensions) that define the product 'space' Collecting information from a sample of customers about their perceptions of each product on the relevant attributes
Positioning- Toothpaste Four main segments: Flavor and product appearance
Flavor, Brightness
Brightness of teeth
Price Positioning
Decay Prevention Decay Prevention
Low Price
Brand Equity
Chapter Questions What is a brand and how does branding work? What is brand equity? How is brand equity built, measured, and managed? What are the important decisions in developing a branding strategy?
Steps in Strategic Brand Identifying Management and establishing brand positioning
Planning and implementing brand marketing Measuring and interpreting brand performance Growing and sustaining brand value
Google - 2002 Brand of the Year
9-31
Brand A name, term, sign, symbol or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.
9-32
Attributes of Strong Brands Excels at delivering Uses multiple marketing desired benefits Stays relevant Priced to meet perceptions of value Positioned properly Communicates consistent brand messages
activities
Understands consumerbrand relationship
9-33
The Role of Brands
Identify the maker
Simplify product handling Organize accounting
Offer legal protection
9-34
The Role of Brands Signify quality
Create barriers to entry
Serve as a competitive advantage Secure price premium
9-35
Branding Endowing products and Services with the power of a brand.
9-36
Brand Equity The differential effect that Brand knowledge has on Consumer response to the marketing of that brand. 9-37
Advantages of Strong Brands
Larger margins
Improved perceptions of product performance Greater loyalty Less vulnerability to competitive marketing actions Less vulnerability to crises
More inelastic consumer response Greater trade cooperation Increased marketing communications effectiveness Possible licensing opportunities
Brand Promise The marketer’s vision of what the brand must be and do for Consumers.
9-39
Brand Equity Models Brand Asset Valuator Aaker Model BRANDZ Brand Resonance
BAV Key Components Differentiation—degree to which a brand as different from others
Service (Nordstrom); Price (Costco); Selection (Toys ‘R’ Us); Performance (Nike); Contemporary home fashion (IKEA); Great Price (Payless Shoes).
BAV Key Components Energy—sense of momentum Frito Lay dug in and found that the bulk of their consumers had more money on the first of the month than they did at the end of the month. Armed with that information, they decided to sell bigger packs during that time and scale back to smaller packs during the middle days of the month.
BAV Key Components Relevance—breadth of a brand’s appeal The role brand plays in comparison to other decision criteria (such as price, availability) The importance of a brand in the decision criterion The importance of buying branded products The likelihood customers will buy a branded product even if they incur extra costs or efforts The importance of a branded product in the purchase decision
BAV Key Components Esteem—how well the brand is regarded and respected
Perceived quality and related perceptions of brands (e.g., Starbucks has higher brand esteem than a convenience store coffee stand)
BAV Key Components Knowledge—how familiar and intimate consumers are with the brand
For example, brand knowledge has a direct and positive effect on intention to adopt an online retailer.
Brand Knowledge Thoughts
Feelings Knowledge
Images
Beliefs Experiences
9-46
Secondary Sources of Brand Knowledge
9-47
Aaker Model Brand identity—unique set of brand associations that represent what the brand stands for and promises to customers (e.g., Ajax—industrial service company)
Aaker Model
Core identity elements—product scope, attributes, quality/value, uses, users, country of origin, organizational attributes, brand personality, and symbols (e.g., Ajax has a spirit of excellence)
Aaker Model Extended identity elements—add textual and guidance (e.g., Ajax is worldly but informal, confident and competent)
Aaker Model Brand essence—communicate the brand identity in a compact and inspiring way (e.g., Ajax has a commitment to excellence)
Aaker Model – Brand Identity
Brand-as-product Zerox
Brand-as-organization Saturn
Brand-as-person Lee Iacocca (Chrysler)
Brand-as-symbol Mr. Clean 9-52
Aaker Model – Brand Assets Brand loyalty
Brand associations Luxurious Car = success, wealth, only the best
Proprietary assets
Brand awareness
Perceived quality 9-53
The BRANDZ Model Bonding nothing better Advantage—better than others Performance—can it deliver?
Relevance—does something for me
Presence—Do I know about it? 9-54
Brand Resonance Pyramid
9-55
Drivers of Brand Equity Brand Elements
Marketing Activitie
Meaning Transference
9-56
Brand Elements Brand names
Slogans
Characters
URLs
Elements
Logos
Symbols 9-57
Brand Elements
9-58
Brand Element Choice Criteria Memorable--recall and recognized Meaningful--credible Likeability--aesthetically appealing Transferable--introduce new product Adaptable--updatable Protectable-- legality
Slogans Like a good neighbor, State Farm is there Just do it Nothing runs like a Deere
We try harder We’ll pick you up Nextel – Done Zoom Zoom This Bud’s for you 9-60
Designing Holistic Marketing Activities
Personalization—brand and its marketing are as relevant as possible to as many customers as possible
Designing Holistic Marketing Activities
Integration—mixing and matching marketing activities to maximize their individual and collective effects (e.g., Olive Garden).
Designing Holistic Marketing Activities
Internalization—activities and processes that help inform and inspire employees.
Internal Branding Choose the right moment—turning points and ideal opportunities (e.g., British Petroleum repositioning to “Beyond Petroleum) BP: Forget Your Brand Image and Concentrate on Your Brand's Soul Thu May 6, 2010
Internal Branding
Link internal and external marketing — messages must match internal and external campaigns (e.g., IBM to become a leader in the used of internet technology)
Internal Branding Bring the brand alive for employees —informative Brewing tapped into and energizing (e.g., Miller heritage to generate pride and passion)
Measuring Brand Equity
Brand Audits—assess health of brand, uncover sources of brand equity, ways to improve Brand Tracking—baseline information about brands and marketing information Brand Valuation—estimation of total financial value of the brand
9-67
The 10 Most Valuable Brands Brand
Coca-Cola Microsoft IBM GE Intel Nokia Toyota Disney McDonald’s Mercedes-Benz
$67.00
2006 Brand Value (Billions) $56.93 $56.20 $48.91 $38.32 $30.13 $27.94
$27.85 $27.50 $22.13
Managing Brand Equity
Brand Reinforcement— meaning of the brand Brand Revitalization—retain same or create new positioning
Brand Crises
9-69
Interbrand’s Steps in Calculating Brand Equity
Market segmentation—divide into mutually exclusive segments Financial analysis—earnings attributed to the intangible assets of the business Role of branding—degree that the brand directly influences drivers of demand Brand strength—likelihood that the brand will realize forecast earnings Brand value calculation—net present value of the forecast brand earnings; discounted by the brand discount rate
Devising a Branding Strategy Develop new brand elements
Apply existing brand elements Use a combination of old and new
9-71
Branding Terms
Brand line—all products Brand mix—set of all brand lines made available to buyers
Brand extension—established brand used to introduce a new brand (Hershey Kisses)
Sub-brand—combine a new brand with an existing brand (American Express Blue Cards)
Parent brand—existing brand that give birth to a brand extension or sub-brand
Family brand—parent brand that is associated with multiple products through extensions (Kraft)
Line extension—parent brand covers a new product within a product categories it currently serves (Dannon yogurt introduced new favors)
Honda automobiles, motorcycles, snow- blowers)
Branded variants—specific brand lines supplied to specific retailers or distribution channels (low and high end cameras)
Licensed product—brand names that had been licensed to other manufacturers to make the product (franchises)
Brand dilution—occurs when consumers no longer associate a brand with a specific product or highly similar products and start thinking less of the brand
Brand portfolio—set of all brands and brand lines a particular firm offers for sale in a particular category or market segment
Apple iMac eMac iMac Mac mini
MacBook MacBook
iPod
Apple TV iPhone iPod Touch
MacBook Pro
iPod nano iPod Classic iPod shuffle
Brand Naming
Individual names (e.g., General Mills—Bisquick, Gold Meal Flour)
Blanket family names (e.g., Heinz, General Electric) Separate family names (e.g., Sears uses Kenmore, Craftsman) Corporate name combined with individual product names (e.g., Kellogg’s Rice Krispies, Raisin Brain)
9-83
Reasons for Brand Portfolios
Increasing shelf presence and retailer dependence in the store Attracting consumers seeking variety Increasing internal competition within the firm Yielding economies of scale in advertising, sales, merchandising, and distribution
Brand Roles in a Brand Portfolio Flankers—fighter brand (e.g., Protector and Gamble markets Luvs diapers in a way that flanks Pampers (flagship)
Brand Roles in a Brand Portfolio Cash cows—capitalizing on existing brand equity (e.g., Gillette still sells older Trac II, even though market newer Mach III and Fusion brands of razors)
Brand Roles in a Brand Portfolio Low-end, entry-level—traffic builders (e.g., BMW 3-series automobiles to bring in new customers to the franchise)
Brand Roles in a Brand Portfolio High-end prestige—add prestige and credibility to the entire portfolio (e.g., Corvette sport cars help improve the image of other Chevrolet cars)
Study Question 1 The American Marketing Association defines a ________ as “a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.” A. B. C. D. E.
holistic product concept product concept service concept Brand brand image
Study Question 2 Consumers learn about brands through ________ and product marketing programs.
A. B. C. D. E.
the mass media past experiences with the product the sales force shopping bots independent information sources
Study Question 3
The premise of ________ models is that the power of a brand lies in what customers have seen, read, learned, thought, and felt about the brand over time.
A. B. C. D. E.
product-based brand equity service-based brand equity functional-based brand equity mission-driven brand equity customer-based brand equity
Study Question 4 ________ can be defined as the differential effect that brand knowledge has on consumer response to the marketing of that brand.
A. B. C. D. E.
Mission-driven brand equity Customer-based brand equity Product-driven brand equity Service-driven brand equity Function-based brand equity
Study Question 5
When a consumer expresses thoughts, feelings, images, experiences, beliefs, and so on that become associated with the brand, the consumer is expressing brand ________.
A. B. C. D. E.
Knowledge Loyalty Behavior Preference equity
Reference Philip Kotler & Kevin Keller, Brand Management, 9th chapter, 13th edition.
Dr.S.Yogananthan
Contents Introduction to brand Functions Characteristics Relationships Brand Identity & Image Difference & Parity
What is a brand?
A name, a term
A symbol, a sign
“A name, term, sign, symbol or any other feature that identifies one seller’s product or service as distinct from those of other sellers” -The American Marketing Association
Brand can be Logo – shortcut to remind Colours Shape Letter Images Tunes Phrases Celebraties
Functions of Branding Helps in Identification and gives distinctiveness to the product Indirectly denotes quality and standard Eliminates Imitation Ensures legal right to the product (Trademark, patents, copyrights…) Helps in advertising and packaging Helps in price differentiation of the product
Characteristics of a Strong Brand Brand name should describe its nature Easy to remember and pronounce Act as a stimulating trigger to customers Brand portfolio and hierarchy should make sense Brand should properly positioned Brand should be consistent Brand should be given continuous support and monitoring
Scope of Branding To teach the customers the following:-
1. 2. 3.
“Who the product”- name, other elements “What the product does” “Why the consumers should buy”
Brand relationships FIRM Brand identity framed by marketers
INTERACTIONS
CUSTOMERS
Brand relationships
Brand image in the mind of customers
Branding process Brand the actual image of the firm in customers’ minds A new definition based on Brand relationships: Brand is created in continuously developing brand relationships where the customer forms a differentiating image of a product or service based on all kinds of brand contacts that the customer is exposed to.
Brand Identity is what the owner wants to communicate to its potential costumers.
A unique set of associations in the minds of customers concerning what a brand stands for and the implied promises the brand makes.
The importance of image Image communicates expectations Image is a filter influencing perceptions of the performance of the firm Image is a function of expectations and experiences
Image has employees
an
internal
impact
on
Image and Identity
Sending
Media
Brand identity
Signals transmitted
Receiving
Brand image
Competition And Noise
Contd.. BRAND IMAGE is a unique set of associations in the minds of customers concerning what a brand stands for and the implied promises the brand makes. BRAND IDENTITY is the strategic goal for the unique set of associations that a brand should stand for. These associations also imply a potential promise to customers. PERCEPTION GAP.
Brand Hierarchy Brand Hierarchy is how an organization organizes the various named entities within its portfolio, and how they relate to each other. The four general types of Hierarchy are: 1. Master brand : Maruti Suzuki 2. Brand/sub brand : Maruti 3. Endorsed brand : Maruti Esteem 4. Separate (stand-alone or independent) brands: LXi/ SXi
* http://www.interbrand.com/best_global_brands.aspx
Brand Positioning Brand Positioning
“Positioning is how a product appears in relation to other products in the market” Brand positioning is all about identifying the optimal location in our customers’ minds for our Brand vis-àvis with our competitors Proper positioning makes it easier to facilitate understanding of our Brand
Developing a Positioning Strategy Positioning is not what you do with a product but what you do in the mind of the prospects. Positioning requires determining the frame of reference by identifying Target market Competition POP’s and POD’S
Category membership
Starting point in brand positioning is to determine Category Membership. Category membership is product or set of products with a brand competes and which functions as close substitutes Three main ways to determine category membership: Announcing category benefit Comparing to exemplars Relying on the product descriptors
Target Market Consumer Aggregates Current users Potential users Competitive users Consumer Segments Behavioral Dem/psych/geo
Points of Difference & Parity Difference Strong, favorable, unique Attribute or benefit Parity • Shared with other brands • Important for brand extensions
POP’S Point of Parity (POP) Two Types Category : attributes that are required to include your product as a member of that category. Competitive: POP’s that negate your competitor's POD’s POP’s should be “good enough” but POD’s should be superior
Choosing the differentiating strategy
Product differentiation Personal differentiation Channel differentiation Image differentiation
Choosing the pop’s and pod’s Relevance Distinctiveness Believability Feasibility Communicability Sustainability
Proper Positioning Clarifies what the Brand is all about How it is both unique and similar to competitive brands Why customers should purchase and use the Brand
5 Factors of Brand Positioning
1. Brand Attributes : What the brand delivers through features and benefits to consumers. 2. Consumer Expectations : What consumers expect to receive from the brand. 3. Competitor attributes: What the other brands in the market offer through features and benefits to consumers. 4. Price : An easily quantifiable factor – Your prices vs. your competitors’ prices. 5. Consumer perceptions: The perceived quality and value of your brand in consumer’s minds (i.e., does your brand offer the cheap solution, the good value for the money solution, the high-end, high-price tag solution, etc.?).
The Process of Positioning
Generally, the product positioning process involves:
Defining the market in which the product or brand will compete (who the relevant buyers are) Identifying the attributes (also called dimensions) that define the product 'space' Collecting information from a sample of customers about their perceptions of each product on the relevant attributes
Positioning- Toothpaste Four main segments: Flavor and product appearance
Flavor, Brightness
Brightness of teeth
Price Positioning
Decay Prevention Decay Prevention
Low Price
Brand Equity
Chapter Questions What is a brand and how does branding work? What is brand equity? How is brand equity built, measured, and managed? What are the important decisions in developing a branding strategy?
Steps in Strategic Brand Identifying Management and establishing brand positioning
Planning and implementing brand marketing Measuring and interpreting brand performance Growing and sustaining brand value
Google - 2002 Brand of the Year
9-31
Brand A name, term, sign, symbol or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.
9-32
Attributes of Strong Brands Excels at delivering Uses multiple marketing desired benefits Stays relevant Priced to meet perceptions of value Positioned properly Communicates consistent brand messages
activities
Understands consumerbrand relationship
9-33
The Role of Brands
Identify the maker
Simplify product handling Organize accounting
Offer legal protection
9-34
The Role of Brands Signify quality
Create barriers to entry
Serve as a competitive advantage Secure price premium
9-35
Branding Endowing products and Services with the power of a brand.
9-36
Brand Equity The differential effect that Brand knowledge has on Consumer response to the marketing of that brand. 9-37
Advantages of Strong Brands
Larger margins
Improved perceptions of product performance Greater loyalty Less vulnerability to competitive marketing actions Less vulnerability to crises
More inelastic consumer response Greater trade cooperation Increased marketing communications effectiveness Possible licensing opportunities
Brand Promise The marketer’s vision of what the brand must be and do for Consumers.
9-39
Brand Equity Models Brand Asset Valuator Aaker Model BRANDZ Brand Resonance
BAV Key Components Differentiation—degree to which a brand as different from others
Service (Nordstrom); Price (Costco); Selection (Toys ‘R’ Us); Performance (Nike); Contemporary home fashion (IKEA); Great Price (Payless Shoes).
BAV Key Components Energy—sense of momentum Frito Lay dug in and found that the bulk of their consumers had more money on the first of the month than they did at the end of the month. Armed with that information, they decided to sell bigger packs during that time and scale back to smaller packs during the middle days of the month.
BAV Key Components Relevance—breadth of a brand’s appeal The role brand plays in comparison to other decision criteria (such as price, availability) The importance of a brand in the decision criterion The importance of buying branded products The likelihood customers will buy a branded product even if they incur extra costs or efforts The importance of a branded product in the purchase decision
BAV Key Components Esteem—how well the brand is regarded and respected
Perceived quality and related perceptions of brands (e.g., Starbucks has higher brand esteem than a convenience store coffee stand)
BAV Key Components Knowledge—how familiar and intimate consumers are with the brand
For example, brand knowledge has a direct and positive effect on intention to adopt an online retailer.
Brand Knowledge Thoughts
Feelings Knowledge
Images
Beliefs Experiences
9-46
Secondary Sources of Brand Knowledge
9-47
Aaker Model Brand identity—unique set of brand associations that represent what the brand stands for and promises to customers (e.g., Ajax—industrial service company)
Aaker Model
Core identity elements—product scope, attributes, quality/value, uses, users, country of origin, organizational attributes, brand personality, and symbols (e.g., Ajax has a spirit of excellence)
Aaker Model Extended identity elements—add textual and guidance (e.g., Ajax is worldly but informal, confident and competent)
Aaker Model Brand essence—communicate the brand identity in a compact and inspiring way (e.g., Ajax has a commitment to excellence)
Aaker Model – Brand Identity
Brand-as-product Zerox
Brand-as-organization Saturn
Brand-as-person Lee Iacocca (Chrysler)
Brand-as-symbol Mr. Clean 9-52
Aaker Model – Brand Assets Brand loyalty
Brand associations Luxurious Car = success, wealth, only the best
Proprietary assets
Brand awareness
Perceived quality 9-53
The BRANDZ Model Bonding nothing better Advantage—better than others Performance—can it deliver?
Relevance—does something for me
Presence—Do I know about it? 9-54
Brand Resonance Pyramid
9-55
Drivers of Brand Equity Brand Elements
Marketing Activitie
Meaning Transference
9-56
Brand Elements Brand names
Slogans
Characters
URLs
Elements
Logos
Symbols 9-57
Brand Elements
9-58
Brand Element Choice Criteria Memorable--recall and recognized Meaningful--credible Likeability--aesthetically appealing Transferable--introduce new product Adaptable--updatable Protectable-- legality
Slogans Like a good neighbor, State Farm is there Just do it Nothing runs like a Deere
We try harder We’ll pick you up Nextel – Done Zoom Zoom This Bud’s for you 9-60
Designing Holistic Marketing Activities
Personalization—brand and its marketing are as relevant as possible to as many customers as possible
Designing Holistic Marketing Activities
Integration—mixing and matching marketing activities to maximize their individual and collective effects (e.g., Olive Garden).
Designing Holistic Marketing Activities
Internalization—activities and processes that help inform and inspire employees.
Internal Branding Choose the right moment—turning points and ideal opportunities (e.g., British Petroleum repositioning to “Beyond Petroleum) BP: Forget Your Brand Image and Concentrate on Your Brand's Soul Thu May 6, 2010
Internal Branding
Link internal and external marketing — messages must match internal and external campaigns (e.g., IBM to become a leader in the used of internet technology)
Internal Branding Bring the brand alive for employees —informative Brewing tapped into and energizing (e.g., Miller heritage to generate pride and passion)
Measuring Brand Equity
Brand Audits—assess health of brand, uncover sources of brand equity, ways to improve Brand Tracking—baseline information about brands and marketing information Brand Valuation—estimation of total financial value of the brand
9-67
The 10 Most Valuable Brands Brand
Coca-Cola Microsoft IBM GE Intel Nokia Toyota Disney McDonald’s Mercedes-Benz
$67.00
2006 Brand Value (Billions) $56.93 $56.20 $48.91 $38.32 $30.13 $27.94
$27.85 $27.50 $22.13
Managing Brand Equity
Brand Reinforcement— meaning of the brand Brand Revitalization—retain same or create new positioning
Brand Crises
9-69
Interbrand’s Steps in Calculating Brand Equity
Market segmentation—divide into mutually exclusive segments Financial analysis—earnings attributed to the intangible assets of the business Role of branding—degree that the brand directly influences drivers of demand Brand strength—likelihood that the brand will realize forecast earnings Brand value calculation—net present value of the forecast brand earnings; discounted by the brand discount rate
Devising a Branding Strategy Develop new brand elements
Apply existing brand elements Use a combination of old and new
9-71
Branding Terms
Brand line—all products Brand mix—set of all brand lines made available to buyers
Brand extension—established brand used to introduce a new brand (Hershey Kisses)
Sub-brand—combine a new brand with an existing brand (American Express Blue Cards)
Parent brand—existing brand that give birth to a brand extension or sub-brand
Family brand—parent brand that is associated with multiple products through extensions (Kraft)
Line extension—parent brand covers a new product within a product categories it currently serves (Dannon yogurt introduced new favors)
Honda automobiles, motorcycles, snow- blowers)
Branded variants—specific brand lines supplied to specific retailers or distribution channels (low and high end cameras)
Licensed product—brand names that had been licensed to other manufacturers to make the product (franchises)
Brand dilution—occurs when consumers no longer associate a brand with a specific product or highly similar products and start thinking less of the brand
Brand portfolio—set of all brands and brand lines a particular firm offers for sale in a particular category or market segment
Apple iMac eMac iMac Mac mini
MacBook MacBook
iPod
Apple TV iPhone iPod Touch
MacBook Pro
iPod nano iPod Classic iPod shuffle
Brand Naming
Individual names (e.g., General Mills—Bisquick, Gold Meal Flour)
Blanket family names (e.g., Heinz, General Electric) Separate family names (e.g., Sears uses Kenmore, Craftsman) Corporate name combined with individual product names (e.g., Kellogg’s Rice Krispies, Raisin Brain)
9-83
Reasons for Brand Portfolios
Increasing shelf presence and retailer dependence in the store Attracting consumers seeking variety Increasing internal competition within the firm Yielding economies of scale in advertising, sales, merchandising, and distribution
Brand Roles in a Brand Portfolio Flankers—fighter brand (e.g., Protector and Gamble markets Luvs diapers in a way that flanks Pampers (flagship)
Brand Roles in a Brand Portfolio Cash cows—capitalizing on existing brand equity (e.g., Gillette still sells older Trac II, even though market newer Mach III and Fusion brands of razors)
Brand Roles in a Brand Portfolio Low-end, entry-level—traffic builders (e.g., BMW 3-series automobiles to bring in new customers to the franchise)
Brand Roles in a Brand Portfolio High-end prestige—add prestige and credibility to the entire portfolio (e.g., Corvette sport cars help improve the image of other Chevrolet cars)
Study Question 1 The American Marketing Association defines a ________ as “a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.” A. B. C. D. E.
holistic product concept product concept service concept Brand brand image
Study Question 2 Consumers learn about brands through ________ and product marketing programs.
A. B. C. D. E.
the mass media past experiences with the product the sales force shopping bots independent information sources
Study Question 3
The premise of ________ models is that the power of a brand lies in what customers have seen, read, learned, thought, and felt about the brand over time.
A. B. C. D. E.
product-based brand equity service-based brand equity functional-based brand equity mission-driven brand equity customer-based brand equity
Study Question 4 ________ can be defined as the differential effect that brand knowledge has on consumer response to the marketing of that brand.
A. B. C. D. E.
Mission-driven brand equity Customer-based brand equity Product-driven brand equity Service-driven brand equity Function-based brand equity
Study Question 5
When a consumer expresses thoughts, feelings, images, experiences, beliefs, and so on that become associated with the brand, the consumer is expressing brand ________.
A. B. C. D. E.
Knowledge Loyalty Behavior Preference equity
Reference Philip Kotler & Kevin Keller, Brand Management, 9th chapter, 13th edition.
