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Brand Hierarchy. Managing Brand Systems - Building Strong Brands(1996) David Aaker Brand System Objectives Exploit commonalities to generate synergy Reduce.

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Presentation on theme: "Brand Hierarchy. Managing Brand Systems - Building Strong Brands(1996) David Aaker Brand System Objectives Exploit commonalities to generate synergy Reduce."— Presentation transcript:

1 Brand Hierarchy

2 Managing Brand Systems - Building Strong Brands(1996) David Aaker Brand System Objectives Exploit commonalities to generate synergy Reduce brand identity damage Achieve clarity of product offerings Facilitate change and adaptation Allocate Resources -Brands at each level in the hierarchy have a particular role to play in the system. -Brands on one level have important relationships with those on the other levels. Brand Hierarchy Corporate Brand Range Brand Sub Brand Range Brand Product Line Brand Sub Brand Product Line Brand Product Line Brand Product Line Brand Product Line Brand Product Line Brand Sub Brand Sub Brand Sub Brand Sub Brand Sub Brand Sub Brand Sub Brand brand that ranges over several product classes brand associated with the organizations specific products additionally refine product offerings insuranceLoan Investment Life insurance Whole LifeVariable Whole Life home insurancecar insurance

3 Brand Roles in the Brand Hierarchy Driver Roles Brand that drives purchase decision. Its identity represents what customer primarily expects to receive from the purchase. Value Proposition that is central to the purchase decision Endorser Roles Brand provides support and credibility to the driver brands claims. The company behind the brand is substantial, successful that would be only associated with a strong products Reassurance to customers that product will deliver promised functional benefits BRAND ROLES Endorser Driver Silver Bullets Strategic Brand Sub Brand Branded Benefits Features Components Service Programs Describe Offerings Structure and clarify offerings Augment/ Modify Brand Identity Exploit Market Opportunities Support Extensions A brand can perform both the endorser and driver roles, when it simultaneously represents the value proposition provided by a product and the support of an organization.

4 Corporate Dominant Brand names (16%) Brand Dominant names (32%) Endorser Brand (14%) Dual Brand (38%) Heinz Ketchup, Shell Oil P&G ( Crest, Pantene….), Mars ( Sneakers, M&M…) Unilever, 3M Cadburys Dairy Milk Chocolate, Friskies Gourmet A La Carte Strategic Brands : brand in unattractive market, with weak brand position, not fit the future vision of firms its market overcrowded( strong competition), low margin, declining sales, brand lack points of differentiation/ may require significant investment for winning strategy For efficiency in resource allocation, strategic classification of brands needs to be performed; ( similar to BCG martrix) Divestment Candidate Milker Strategic Brand Milker: Divestment Candidate : brand may be tired but has some real strengths has core customer base that will support reasonable margin brand can be maintained with minimal support, providing cash flow to fund other brands Strategic Brand: important to the future performance of the company 1) represents a meaningful quantity of sales/ profits in the future 2) brand can be critical in achieving success of other business or the entire company ( IBM OS2, Win95 OS operating platform, software.)

5 Sub Brands Brand that distinguishes a part of the product line within the brand system Sub brand can be a driver or a descriptor brand Role of Sub brand 2) Structure & Clarify Options 1) Describe Offerings 3) Augment/Modify Identity by Changing Associations 4) Exploit Market Opportunity 5) Support Vertical and Horizontal Extension Support a New Concept or Target Strengthen/ Protect Existing Associations Soften a Strong Association Modifier and Modified Concepts BRAND ROLES Endorser Driver Silver Bullets Strategic Brand Sub Brand Branding Benefits

6 - Communicates product class, feature, target segment, or a function of a brand ( : Oral B Tooth and Gum Care Toothpaste, Anti-Plaque Rinse Oral B driver brand ( dominating purchase decision and defining the use of experience), Tooth~ function descriptive brand.) -Descriptor brand : Sub brand driver brand (dilute). - descriptor driver. ( : Levis Loose: Loose function describe Levis. Loose identity driver. ) -Specify Segments; MS Office, MS Home ( biz user vs. home user) -Prefix and Suffix: McDonal Mc., HP –Jet. 2) Structure & Clarify Options 1) Describe Offerings -Provides a way to offer different products or serve diff. markets under one brand name, minimizing consumer confusion and brand dilution ( : brand,, ) -Presents customer with a new option/ Also creates a structure that positions the brand ; -customers understand 1) new product fits within the brand system and possesses some aspect of brand identity, 2) new product is different on key dimensions from other products in the brand system BRAND ROLES Endorser Driver Silver Bullets Strategic Brand Sub Brand Branding Benefits

7 3) Augment/ Modify Identity - Create associations needed to compete in an attractive new product market ( : stretching a brand into a new market is expensive, inadequate for the new context, dilutes brands existing product class or attribute associations ) -Draw from the parent brand the reassurance of a familiar name plus other intangibles / personality dimensions A. Support a New Concept of Target ( : P&G Sure ( ) : Sub Brand Sure- ProStick ( Sure. ) B. Strengthen/ Protect Existing Associations ( : Smuckers Jam 100% Fruit Simply Fruit identity.) C. Soften a Strong Association (liability) ( : Kleenex ; stretch.) D. Modifier and Modified Concepts Sub brand. (,, & Shocker ) (modified brand) attribute importance attribute performance ratings Memory dominant concept. ( : Slim Fast cake mix by Godiva; (low calorie). Godiva cake mix by Slim Fast;, richness. ) BRAND ROLES Endorser Driver Silver Bullets Strategic Brand Sub Brand Branding Benefits

8 4) Exploit Market Opportunities -Sub branding Strategic Opportunity ( ). : emerging niche market,, niche market, sub brand, niche market life cycle core brand sub brand kill. Nike: segment needs, targeting, endorsement sub brand. 5) Support Vertical & Horizontal Extension - sub brand : Horizontal extension support : Vertical extension support: quality BRAND ROLES Endorser Driver Silver Bullets Strategic Brand Sub Brand Branding Benefits Leveraging the Brand LineExtensions Stretching the Brand Vertically BrandExtensions Co-Branding In Existing Product Class In Existing Product Class In Different Product Class StretchingDown StretchingUp Ad Hoc BrandExtensions Creating A Brand Range Chapter 9

9 BrandingBenefits,,, benefit branding. Branding a Feature Branding a Component Branding a Service Program Designing a new or improved product, there should be one or more design features that enable the brand to excel. Act of branding a feature: successful communication gives credibility and enhances ability of the feature to differentiate and add value Making Visible of a component or ingredient : Nestles Lite Ice Cream Bar with Nutra Sweet( ), Gateway computer Intel inside, Timberland boots with GoreTex Branded component: Point of Differentiation, use of already established brand association ; RI higher price premium Cost benefits;, share. : Hyatt ; biz travlers 5 (,, private floor, reward …….) Levi-Link; Levi Strauss retail customer( ) BRAND ROLES Endorser Driver Silver Bullets Strategic Brand Sub Brand Branding Benefits

10 Sub brand or a branded benefit that is employed as a vehicle for changing or supporting the brand image of a parent brand ; Sony Walkman, Mazda Miata, Ford Taurus Miata: strong, sporty personality Mazda perception bottom-line-trap ; silver bullet, (investment). ( parent brand supporting.) BRAND ROLES Endorser Driver Silver Bullets Strategic Brand Sub Brand Branding Benefits SilverBullets Branded benefit silver bullet.; : Oral B Action Cup ; Oral B Oral B silver bullet.

11 How many brands are desirable? Parent brand endorser brand, signal,. : Ford Taurus, Mazda Miata ; Ford Mazda Is the brand sufficiently different to merit a new name? Will a new name really add value? Will an existing brand be placed at risk if it is used on a new product? Will the business support a new brand name? ? ? trade-off( vs. value). core brand. : 3M ; decentralized, entrepreneurial. ; (3M, Scotch ) + value –adding identity perceived quality, : Suntory ;,,, event sponsorship, Suntory fast food chain upscale.,. (3M )

12 Not Connected Shadow Endorser: not visibly connected to the endorsed brand, but having a known organization backing the brand, while minimizing any association/ contamination Token Endorsement; master brand in several product-market context, less prominent than the endorsed brand to provide some reassurance, credibility Linked Name; linked brand name with common elements creates a family of brands with an implicit or imlied endorser( McDonald Mc ; McNugget, McPizza… ) Strong Endorsement Co Drivers : master / sub brand both have higher driver roles Master Brand as Driver Different Identity Same Identity House of Brands Endorsed Brand Sub brands Branded House Brand Relationship Spectrum - Aaker Independent, but theyre endorsed by another brand, usually on organizational brand. It provides credibility/ substance to the offering/ only minor driver understand he distinction between an organizational brand(Marriott) and product brand ( Marriott Hotel) Brands are connected to a master to parent brand and augment or modify the associations of that master brand. Master brand; primary frame of reference Link between master- sub-brand > Link between endorser-endorsed brand Thus, sub-brand can affect associations of the master brand A master brand moves from being a primary driver to a dominant driver role across a multiple offerings. A sub brand having a modest driver role to being a descriptor with little or no driver role Brand Architecture: Brand Architecture: An organizing structure of the brand portfolio that specifies brand roles and the nature of relationships between brands ( ), connect. ( ) HP Deskjet, Sony Trinitron, ( ) ;, LG,.., …(LG)

13 Branded House : Single master brand to span a set of offerings that operates with only descriptive sub brands Nike, Sony, Kodak Risk : umbrella brand for a wide range of products. : limit firms ability to target specific groups. umbrella brand, segment. Advantage : Reduced Investment,,, ( Enhance Clarity, Synergy and Leverage) Simple branding : a single brand communicated across product (Clarity). (it is easier to understand / Recall than a dozen individual brands) Maximizes Synergy : brand building in one business affect another (.) Leverage : master brand works harder in more context. (.) House of Brands : Involves an independent set of stand-alone brands each maximizing the impact on a market. P & G : 80 brands with little link to P & G each other LG : economies of scale / synergies sacrificed. brand leverage (individual brands tend to have a narrow ranges ) individual brand cannot support investment themselves : clearly position brands on functional benefits & dominate niche segment 1) Niche market with Functional Benefit proposition 2) Avoiding a brand association that would be incompatible with an offering 3) Signaling breakthrough advantages of new offerings 4) Owning a new product class association by using a powerful name that reflects a key benefit. 5) Avoiding or Minimizing channel conflict Branded House Branded House House of Brand

14 Does the master brand contribute to the offering by adding: Associations enhancing the value proposition? Credibility with organizational associations? Visibility? Communication efficiencies? Will the master brand be strengthened by associating with the new offering? Toward a Branded House Is there a compelling need for a separate brand because it will ; Create and own an association? Represent a new, different offering? Avoid an association? Retain/ capture customer/ brand bond? Deal with channel conflict? Will the business support a new brand name? Toward a House of Brands >> >>

15 adding associations that contribute to a value proposition providing credibility to the offering sharing the visibility of master brand generating communication efficiencies Synergy / Cost Advantage. Associations Enhancing the Value Proposition? : Master brand product more appealing ? Value Proposition: Positive association of master brand transfer to new product context ? Are association relevant and appropriate? Credibility with Organizational Associations? New Brand 1) Creating Relevant. & Compelling Value Proposition 2) Value Proposition needs to be made Credible Visibility? Visible established brand link : imply a host of positive product or organizational attributes Communication Efficacies? Ad, promo, packaging display, Costly/ Difficult Prior-brand-building adapted or directly used Cost Advantage Branded House Branded House Dose the master brand contribute to the offering by adding; Will the Master Brand be strengthened by associating with the new offering; Brand extension or brand endorsement should be a vehicle to support and enhance key master brand association Should recognize the boundaries of a brand, and resist temptation to stretch it too far

16 New brand development; costly/ difficult, hence, there must be compelling reason to develop a separate brand. Create & Own an Association? : When an offering has the potential to dominate a functional benefit, a distinct brand is justifiable. Represent a New, Different Offering? Truly new, different offering/ or signaling a breakthrough benefit?; ( A minor evolution or an empty attempt to revitalize a product will rarely qualify) A new brand name should represent a Significant advance in technology / function Avoid an Association? Link with an existing brand create a liability Will a link with an existing brand risk damaging that brand? Retain/ Capture a Customer/ Brand Bond? Strength of acquired brand( visibility, association, customer loyalty) Customer Bond ; If customer bond is strong, keeping an acquired brand is a sound decision Avoid Channel Conflict? Existing Channel - motivated to stock because new brand is exclusive when available at other channels, motivation falls Existing Channel - support higher price because of higher level of service higher level of service brand become available in value channel brands ability to keep a high- margin channel will be in jeopardy House of Brand House of Brand Is there a compelling reason for a separate brand?; Will the business support a new brand name?; If business is too small or short-lived to support necessary brand building, brand name will not be feasible (, channel focus. : LOreal: Lancome, Maybeline, LOreal ) : Saturn- GM adverse effect (association) ( : Gap : Banana Republic(highest end) Gap(middle) Old Navy(Value-end). )

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