1. Ashesi University COURSE TITLE : STRATEGIC BRAND MANAGEMENT SEMESTER : SPRONG 2016 MODULE 9: Designing and Implementing a Branding Strategy I: Brand Architecture, Brand- Product Matrix, Brand Hierarchy Lecturer: Ebow Spio

2. Learning Outcomes Explain how to maximize brand equity across all the different brands and products of the firm Appreciate how a firm determines which brand elements to choose to apply across the products it offers for sale (Branding Strategy or brand architecture) Explain brand terminologies and concepts such as brand architecture, brand-product matrix, brand portfolio, brand hierachy, Explain how cause marketing can build brand equity

3. 11.3 Branding strategy Branding strategy is critical because it is the means by which the firm can help consumers understand its products and services and organize them in their minds. Two important strategic tools: The brand- product matrix and the brand hierarchy help to characterize and formulate branding strategies by defining various relationships among brands and products.

4. 11.4 Branding Strategy or Brand Architecture The branding strategy for a firm reflects the number and nature of common or distinctive brand elements applied to the different products sold by the firm. – Which brand elements can be applied to which products and the nature of new and existing brand elements to be applied to new products

5. 11.5 The role of Brand Architecture Clarify: brand awareness – Improve consumer understanding and communicate similarity and differences between individual products Motivate: brand image – Maximize transfer of equity to/from the brand to individual products to improve trial and repeat purchase

6. Developing Brand Architecture Strategy 3 Steps or Requirements 1.Defining the Potential of the brand in terms of its “market footprint” 2.Identifying the Product and Service Extensions that will allow the brand achieve that potential 3. Specifying the brand elements and positioning associated with the specific products and services for the brand

7. Developing Brand Architecture Strategy : Defining the Brand Potential 1. Brand Vision : Management’s view of the brand’s long term potential. It relates to the brand’s “higher order purpose” e.g. eliciting joy, enabling connections, evoking pride, inspiring exploration etc. Crayola : Known for crayons. Now Crayola Chalk, Crayola Glitter Glue, Crayola Scissors hence Brand Meaning of “Colourful Arts and crafts for kids” Brand Essence is to find “What if “ in each child” “ We believe in unleashing, nurturing and celebrating the colourful originality in every child. We give kids an invitation that ignites, colours that inspire, and tools that transform original thoughts into visible form. We give colourful wings to the invisible that grow in the hearts of children. Because we believe that creatively alive kids grow into inspired adults.”

8. Developing Brand Architecture Strategy : Defining the Brand Potential 2. Defining Brand Boundaries: Identifying the products or services the brand should offer, it should supply and the needs it should satisfy based on its brand vision and positioning. 3. Crafting the Brand Positioning: The unique and valuable place the brand seeks to occupy in the minds and hearts of consumers relative to its competitors.

9. Developing Brand Architecture Strategy : Identifying Brand Extension Opportunities 2. Identify new products and services to achieve that potential through a well-designed and implemented brand extension strategy. Line Extension : New product introductions within existing category e.g. Close Up White Category Extensions: New product introductions outside existing categories etc. Sunlight Dishwash, Dove Deodorant

10. Developing Brand Architecture Strategy : Branding New Products and Services 3. Branding New Products and Services This involves deciding the specific brand elements to use for any particular new product or service associated with the brand. New products and services must be branded in a way to maximize the brand’s overall clarity and understanding to consumers and customers N

11. 11.11 Brand-Product Matrix Must define: – Brand-Product relationships (rows) Line and category extensions – Product-Brand relationships (columns) Brand portfolio 1234 A B C Products Brands

12. 11.12 Important Definitions Product line – A group pf products within a product category that are closely related Product mix (product assortment) – The set of all product lines and items that a particular seller makes available to buyers Brand mix (brand assortment) – The set of all brand lines that a particular seller makes available to buyers

13. 11.13 Breadth of a Branding Strategy Breadth of product mix – Aggregate market factors – Category factors – Environmental factors Depth of product mix – Examining the percentage of sales and profits contributed by each item in the product line – Deciding to increase the length of the product line by adding new variants or items typically expands market coverage and therefore market share but also increases costs

14. 11.14 Depth of a Branding Strategy The number and nature of different brands marketed in the product class sold by a firm Referred to as brand portfolio The reason is to pursue different market segments, different channels of distribution, or different geographic boundaries Maximize market coverage and minimize brand overlap

15. 11.15 Ford Brand Portfolio

16. 11.16 Designing a Brand Portfolio Basic principles: – Maximize market coverage so that no potential customers are being ignored – Minimize brand overlap so that brands aren’t competing among themselves to gain the same customer’s approval

17. 11.17 Brand Roles in the Portfolio Flankers Cash cows Low-end entry-level High-end prestige brands

18. 11.18 Brand Hierarchy A means of summarizing the branding strategy by displaying the number and nature of common and distinctive brand elements across the firm’s products, revealing the explicit ordering of brand elements A useful means of graphically portraying a firm’s branding strategy

19. 11.19 Brand Hierarchy Tree: Toyota Toyota Corporation Toyota (Trucks) Toyota (SUV/vans) Lexus Toyota Financial Services Toyota (Cars) Corolla PriusAvalonCelicaECHOMatrix MR2 Spyder Camry CE S LE SE LE XLE Platinum Edition XL XLS SE SLE

20. 11.20 Brand Hierarchy Levels Family Brand (Buick) Corporate Brand (General Motors) Modifier: Item or Model ( Ultra ) Individual Brand (Park Avenue)

21. 11.21 Corporate Brand Equity Occurs when relevant constituents hold strong, favorable, and unique associations about the corporate brand in memory Encompasses a much wider range of associations than a product brand

22. 11.22 Umbrella or Family or Range Brands Brands applied across a range of product categories e.g. Sunlight, Dove, Nivea An efficient means to link common associations to multiple but distinct products

23. 11.23 Individual Brands Restricted to essentially one product category There may be multiple product types offered on the basis of different models, package sizes, flavors, etc.

24. 11.24 Modifiers Signals refinements or differences in the brand related to factors such as quality levels, attributes, functions, etc. Plays an important organizing role in communicating how different products within a category that share the same brand name are. E.g. Johnnie Walker Red Label, Black Label, Gold Label Scotch whiskey, Wrigley’s Spearmint, Doublemint, Juicy Fruit etc.

25. 11.25 Corporate Image Dimensions Corporate product attributes, benefits or attitudes – Quality – Innovativeness People and relationships – Customer orientation Values and programs – Concern with the environment – Social responsibility Corporate credibility – Expertise – Trustworthiness – Likability

26. 11.26 Brand Hierarchy Decisions The number of levels of the hierarchy to use in general How brand elements from different levels of the hierarchy are combined, if at all, for any one particular product How any one brand element is linked, if at all, to multiple products Desired brand awareness and image at each level

27. 11.27 Number of Hierarchy Levels Principle of simplicity – Employ as few levels as possible Principle of clarity – Logic and relationship of all brand elements employed must be obvious and transparent

28. 11.28 Levels of Awareness and Associations Principle of relevance – Create global associations that are relevant across as many individual items as possible Principle of differentiation – Differentiate individual items and brands

29. 11.29 Linking Brands at Different Levels Principle of prominence – The relative prominence of brand elements affects perceptions of product distance and the type of image created for new products

30. 11.30 Linking Brands Across Products Principle of commonality – The more common elements shared by products, the stronger the linkages

31. 11.31 Brand Architecture Guidelines Adopt a strong customer focus Avoid over-branding Establish rules and conventions and be disciplined Create broad, robust brand platforms Selectively employ sub-brands as means of complementing and strengthening brands Selectively extend brands to establish new brand equity and enhance existing brand equity

32. 11.32 Corporate Brand Campaign Different objectives are possible: – Build awareness of the company and the nature of its business – Create favorable attitudes and perceptions of company credibility – Link beliefs that can be leveraged by product-specific marketing – Make a favorable impression on the financial community – Motivate present employees and attract better recruits – Influence public opinion on issues

33. 11.33 Using Cause Marketing to Build Brand Equity The process of formulating and implementing marketing activities that are characterized by an offer from the firm to contribute a specified amount to a designated cause when customers engage in revenue-providing exchanges that satisfy organizational and individual objectives

34. 11.34 Advantages of Cause Marketing Building brand awareness Enhancing brand image Establishing brand credibility Evoking brand feelings Creating a sense of brand community Eliciting brand engagement

35. 11.35 Green Marketing A special case of cause marketing that is particularly concerned with the environment Explosion of environmentally friendly products and marketing programs

36. 11.36 Crisis Marketing Guidelines The two keys to effectively managing a crisis are that the firm’s response should be swift and that it should be sincere.

37. Key Points 1.Branding strategy is important as a means of enabling consumers to understand and connect with the brand, since it can help consumers organize a company’s products and services in their minds. 2. Designing a brand strategy involves decisions regarding the number of levels to use, how brand elements at different levels will be combined for a given product, and how brand elements will be linked to multiple products. 3. Each successive level in a brand hierarchy allows the firm to communicate additional, specific information about products. 4. In general, associations for a higher-level brand should be relevant to as many brands below it as possible, while brands at the same level should be as differentiated as possible.

38. Tutorial 1.Assign students the task of identifying pairs of competing brands with different branding strategies 2.Contrast the branding strategies and brand portfolios of market leaders in two different industries

39. Brand Architecture in Practice : The Case of Premium Foods Premium Foods : Produce maize products and other branded cereals for House of Grains to market. It is intended to Develop House of Grains into a food marketing outfit which provides Ghanaians with high quality and nutritious products from the finest grains. Products from House of Grains will be fortified with vitamins, minerals and other essential food nutrients to differentiate them from artisanal products.

40. Brand Architecture in Practice : The Case of Premium Foods The purpose of House of Grains is to promote the physical well being of Ghanaians. House of Grains will serve as a house of brands with several cereal products having their individual brand names. The focus will be on each individual brand, however, each brand will enjoy a shadow endorsement from the high quality credentials of House of Grains as each packaging will carry the House of Grains logo. The House of Grain logo will be synonymous with premium quality nutritious grains and products.

41. Brand Architecture in Practice : The Case of Premium Foods LOVIT – a maize brand is the first brand from the House of Grains stable. Each brand may have several products or variants with a descriptor to differentiate the variants from the other products or variants. Descriptor will convey an important attribute or quality cue. House of Grains is starting with maize products because maize products constitute by far the biggest size of the staple foods market in Ghana. Consumers of maize products span various socio economic groups, ethnic groups and ages.

42. 11.42 Brand Architecture in Practice : The Case of Premium Foods House O’ Grains Premium Foods Modifier: Lovit Soft, Lovit Smoth Individual Brands : Lovit, Mavlos

43. Brand Architecture in Practice : The Case of Premium Foods