Product and Branding Strategy New Chapter Product and Branding Strategy PowerPoint by : Prof Sameer Kulkarni

Objectives Identify the various characteristics of products. Learn how companies build and manage product lines and mixes. Understand how companies make better brand decisions. Comprehend how packaging and labeling can be used as marketing tools.

What is a Product? Goods Services Experiences Events Persons Places Properties Organizations Information Ideas

The Product and Product Mix Potential customers judge product offerings according to three elements: Product features and quality Services mix and quality Value-based prices

The Product and Product Mix The customer value hierarchy: Core benefit Basic product Expected product Augmented product Potential product

The Product and Product Mix Classifications Durability and tangibility Consumer goods Industrial goods Nondurable Tangible Rapidly consumed Example: Milk Durable Lasts a long time Example: Oven Services Intangible Example: Tax preparation

The Product and Product Mix Classifications Durability and tangibility Consumer goods Industrial goods Classified by shopping habits: Convenience goods Shopping goods Specialty goods Unsought goods

The Product and Product Mix Materials and parts Farm products Natural products Component materials Component parts Capital items Installations Equipment Supplies and business services Maintenance and repair Advisory services Product Classifications Durability and tangibility Consumer goods Industrial goods

The Product and Product Mix Product mix dimensions: Width: number of product lines Length: total number of items in mix Depth: number of product variants Consistency: degree to which product lines are related

Brand-building Advertising Brand: Amul As per Aaker’s model And As per Kapferer’s prism

AMUL : Aaker’s Model Extended Core Brand Essence: Milk Available Food Value Taste Indian Quality Pride Variety Milk

A Branded Representation AMUL: Aaker’s Model Extended Essence Core A Branded Representation

Brand-building: The Steps Determine the current image with consumers Define the desired image Identify focus areas for action Product development/innovation Packaging/delivery systems Advertising/promotions Implement action plan with a monitoring programme Feedback to action plan

AMUL : Kapferer’s Prism Physique : Taste, Quality Personality : Simple, Indian Culture : Co-operative, Sharing Relationship : Sociable AMUL Self-Image : Proud Indian, Fun loving Reflection : Value Oriented

Product-Line Decisions Product-Line Analysis Product-Line Length Product-Line Modernization, Featuring, and Pruning

Brand Decisions The AMA definition of a brand: “A name, term, sign, symbol, or design, or a combination of these, intended to identify the goods or services of one seller or group of sellers and to differentiate them from the competition.”

Brand Decisions Brands can convey six levels of meaning: Attributes Benefits Values Culture Personality User

Brand Decisions Brand identity decisions include: Name Logo Colors Tagline Symbol Consumer experiences create brand bonding, brand advertising does not.

Brand Decisions Marketers should attempt to create or facilitate awareness, acceptability, preference, and loyalty among consumers. Valuable and powerful brands enjoy high levels of brand loyalty.

Brand Decisions Aaker identified five levels of customer attitudes toward brands: Will change brands, especially for price. No brand loyalty. Satisfied -- has no reason to change. Satisfied -- switching would incur costs. Values brand, sees it as a friend. Devoted to the brand.

Brand Decisions Brand equity refers to the positive differential effect that a brand name has on customers. Brand equity: is related to many factors. allows for reduced marketing costs. is a major contributor to customer equity.

Brand Decisions Key Challenges Advantages of branding: To brand or not Brand sponsor Brand name Brand strategy Brand repositioning Advantages of branding: Facilitates order processing Trademark protection Aids in segmentation Enhances corporate image Branded goods are desired by retailers and distributors

Brand Decisions Key Challenges Options include: To brand or not Brand sponsor Brand name Brand strategy Brand repositioning Options include: Manufacturer (national) brand Distributor (reseller, store, house, private) brand Licensing the brand name

Brand Decisions Key Challenges Strong brand names: To brand or not Brand sponsor Brand name Brand strategy Brand repositioning Strong brand names: Suggest benefits Suggest product qualities Are easy to say, recognize, and remember Are distinctive Should not carry poor meanings in other languages

Brand Decisions Key Challenges To brand or not Brand sponsor Brand name Brand strategy Brand repositioning Varies by type of brand Functional brands Image brands Experiential brands Line extensions Brand extensions Multibrands New brands Co-branding

Brand Decisions Key Challenges To brand or not Brand sponsor Brand name Brand strategy Brand repositioning A brand report card can be used to audit a brand’s strengths and weaknesses. Changes in preferences or the presence of a new competitor may indicate a need for brand repositioning.

Packaging and Labeling Packaging includes: The primary package The secondary package The shipping package Many factors have influenced the increased use of packaging as a marketing tool.

Packaging and Labeling Developing an effective package: Determine the packaging concept Determine key package elements Testing: Engineering tests Visual tests Dealer tests Consumer tests

Packaging and Labeling Labeling functions: Identifies the product or brand May identify product grade May describe the product May promote the product Legal restrictions impact packaging for many products.

Objective of advertising “Build the business today and build brand value overtime” All advertising has to pass through this objective test

How does Advertising build Brands? Building brand salience Unaided awareness - aided awareness Building brand appeal Intention to try - trial Reinforce usage - increase usage Building brand imagery Usage imagery - user imagery

Building Blocks for Brand-building Advertising I Market analysis Size, volume, value, growth, geographic, seasonality Company analysis Size, profitability, distribution, technology Consumer analysis Size, demographic, geographic Usage, depth, width Brand Competitor analysis Size, profitability, strengths, weaknesses

Building Blocks for Brand-building Advertising II Market Analysis+Consumer Analysis +Company Analysis + Competitor Analysis Marketing Objectives Sales , Market Share , Profits Marketing Strategy Product , Pricing , distribution , Service , packaging , Advertising & Sales Promotion Advertising Objective Awareness , Salience , Image , attitude Advertising Strategy Creative Strategy , Media Strategy

How Does Advertising Work I Classic Hierarchy of Effect Model Purchase Conviction Preference Liking Knowledge Awareness

How Does Advertising Work II Hierarchy of effect model tends to assume that advertising works the same way for all product categories Work on understanding Consumer Behaviour revealed that advertising would work differently for different products Several new models were developed in the eighties and the nineties One such model was the FCB Grid The Grid categorised products as High involvement Vs low involvement Thinking Vs feeling

How Does Advertising Work II FCB Grid Low involvement Consumer is not involved; tends to see the utilitarian values of the category; routine/quick decision making E.g.: detergents, fuel, flour, mobile service (?) High involvement Consumer is involved with the product category; identifies with it and often takes time to decide which brand to use E.g.: TV, car, perfume, clothes, insurance (?)

How Does Advertising Work II FCB Grid Think Vs feel Think Consumer decides using his head : ‘Rationality’ drives the choice of product/brand Feel Consumer decides using his heart : ‘ Emotionality’ drives the choice of product/brand

Advertising to fit FCB Grid requirements THINKING FEELING I) INFORMATIVE II) AFFECTIVE HIGH INVOLVEMENT LOW LEARN-FEEL- DO FEEL-LEARN-DO III) HABITUAL IV) SATISFACTION DO-LEARN-FEEL DO-FEEL-LEARN

Category Differences Consumer Products Consumer Durables Services Corporate Lower values Higher values Indeterminate No value Frequent purchase Infrequent Indeterminate Variable Narrow/Broad Target customer Narrow Target Customer Variable Very wide/ variable Role of advertising in brand-building will tend to vary with category type

Brand-building Advertising FCB Grid - Self-test Thinking Feeling High Involvement Low Involvement Plot: car, TV, detergents, perfumes, flour, clothing, insurance, mobile

Consumer Products : What are they? Low value, repeat purchase, ‘consumption’ products Male target : Cigarettes, soft drinks, colognes Housewife: Soaps, shampoo, cooking oil, detergents Teenagers: Soft drinks, confectionery, stationery Repeat usage/purchase: everyday, every week, every month

Consumer Products : Types What is the consumer issue facing the brand? Poor awareness leading to poor trial Poor repeat usage after high trial Lack of desired image perceptions Often low involvement, routine purchase or impulse purchase Some consumer products could be high involvement Perfumes, Cigarettes Health aids, Baby foods What is the key task? Attracting new users Retaining existing users

Consumer Product Purchase Behaviour 1 Who decides, who buys, who influences Map the key influences in the purchase process Example : Toothpaste : Housewife (decision maker) Kid (influencer)

Consumer Product Purchase Behaviour 2 Limited level of information search by consumers Often a routinised purchase or an impulse purchase Extended problem solving only in the case of innovation Cream for ‘foot cracks’

Consumer Product Purchase Behaviour 3 All India Household Category penetration Soaps 99% Washing cake 93% Toothpaste 44% Hair oil 77% Analyse by SEC, Urban/Rural, Per Capita, CDI /BDI Consumer Product Life Cycle : What stage is the product ? Introduction / Growth / Maturity / Decline

Brand-building Advertising Self Test 3 Consumer panel data shows the following: aaaabaacbabcbabbb a, b, c are three brands Draw three inferences from the data What should be the role of advertising for Brand ‘a’ ?

You Learned To identify the various characteristics of products. To learn how companies build and manage product lines and mixes. To understand how companies make better brand decisions. To comprehend how packaging and labeling can be used as marketing tools.

End of Lesson You start Branding