1. Marketing & Services Management
MSc
Marketing & Services Management
Branding Strategy
Dr. Weiyue (Jimmy) Wang

2. Branding To understand: what is brand what is brand equity
five categories of brand equity by Aaker
what is customer-based brand equity
how to build a brand equity
brand building implications
advantages of strong brands

3. Product Vs. Brand
A product is anything that is capable of satisfying consumer functional needs.
A brand gives a product a distinctive identity through the creation of a name, design or, more usually, some combination of these.
Functional need, emotional need

4. Why brands are so important – customer perceptions – Coke V Pepsi
Blind (%)
Branded (%)
Prefer Pepsi 51 23
Prefer Coke 44 65
Equal/Don’t Know 5 12
Strong brand names affect perceptions and preferences

5. Why brand? Company perspective Customer perspective
Helps with ever growing choice
Reduces search costs
Reduces psychological risks
Gives customers confidence – heritage/reputation
Therefore allows for easier choice – one more decision you don’t have to make!
Can obtain premium prices
Or sell at market price to increase volume
And then benefit from economies of scale
Reduces new product risks
Distinctive identity – difficult to copy
Good products/brands add value
Builds internal pride

6. What is a brand?
A brand is a name that is given to a particular product or service or range of products or services (Kotler, Keller, Brady, Goodman, Hansen, 2009).
A brand is a name, term, sign, symbol, design or combination of these, which is used to identify the goods or services of one seller and to differentiate them from those of competitors (Kotler, Wong, Saunders, Armstrong, 2005)
Ownership
Differentiation
Image
Identity
Added value
Relationship

7. Brand Equity – D Aaker
Brand equity is a set of brand assets and liabilities linked to a brand, its name and symbol, that add to or subtract from the value provided by a product or service to a firm and/or to that firm’s customers (Aaker, 1991, p.15)
Brand equity can be grouped into five categories: brand loyalty / brand awareness / perceived quality / brand associations / other brand assets

8. Five categories of Aaker’s brand equity – brand loyalty
Brand loyalty: a measure of the attachment that a customer has to a brand
When a brand makes a change, e.g. price, product feature, etc., how likely its customers will be to switch to another brand
No loyalty --- committed loyalty
Maintain and enhance loyalty: treat customer right / stay close to customer / measure or manage customer satisfaction / create switching costs / provide extras

9. Five categories of Aaker’s brand equity – brand awareness
Ability of a potential buyer to recognise or recall that a brand is a member of a certain product category
Level of awareness: top of mind awareness, brand recall, brand recognition, unawareness
The way from awareness to sales
How to achieve awareness: be different or memorable / involve a slogan or Jingle / symbol exposure / event sponsorship / brand extensions / recall needs repetition

10. Five categories of Aaker’s brand equity – perceived quality
Customer’s perception of the overall quality or superiority of a product or service with respect to its intended purpose, relative to alternatives
Customer perceived quality ≠ customer satisfaction
Perceived quality generates values: a premium price / willingness to buy / differentiation / brand extension

11. Five categories of Aaker’s brand equity – brand associations
Anything linked in memory to a brand
All associations: product attributes, intangibles, customer benefits, relative price, country of origin effect, competitors, product class, personality, life style, celebrity endorsement

12. Five categories of Aaker’s brand equity – other assets
Patents, trademarks, channel relationships, etc

13. Customer-based brand equity – Kevin Lane Keller
Customer-based brand equity occurs when the consumer has a high level of awareness and familiarity with the brand and holds some strong, favorable and unique brand associations in memory
Sources of brand equity: brand awareness & brand image (brand knowledge)
Brand knowledge is the key to create brand equity and consists of a brand note in memory with a variety of associations linked to it

14. Building a strong brand: The Four Steps of Brand Building
Ensure identification of the brand with customers and an association of the brand in customers’ minds
Establish the totality of brand meaning in the minds of consumers
Elicit the proper customer responses to the brand identification and brand meaning
Convert brand response to create an intense, active loyalty relationship between customers and the brand

15. Four Questions Customers ask of Brands
Who are you? (brand identity)
What are you? (brand meaning)
What about you? What do I think or feel about you? (brand responses)
What about you and me? What kind of association and how much of a connection would I like to have with you? (brand relationships)

16. Brand Building Implications
Customers own brands.
Don’t take shortcuts with brands.
Brands should have a duality.
Brands should have richness.
Brand resonance provides important focus.

17. Marketing advantages of strong brands
Greater loyalty and less vulnerability to competitive marketing actions and crises
Larger margins
Greater trade cooperation and support
Increased marketing communication effectiveness
Possible licensing opportunities
Additional brand extension opportunities
Etc.

18. Leveraging Secondary Associations
Creation of new brand associations
Effects on existing brand knowledge
Awareness and knowledge of the entity
Meaningfulness of the knowledge of the entity
Transferability of the knowledge of the entity
These secondary associations may lead to a transfer of:
Response-type associations
Judgments (especially credibility)
Feelings
Meaning-type associations
Product or service performance
Product or service imagery 30

19. Types of Secondary Associations
Company
Co-branding
Extensions
Other brands
COO
employees
Brand
People
Places
Endorsers
Channels
Things
Events
Licensing
Third party

20. Leveraging Secondary Associations
Brand associations may themselves be linked to other entities, creating secondary associations:
Company (through branding strategies)
Country of origin (through identification of product origin)
Channels of distribution (through channels strategy)
Other brands (through co-branding)
Characters (through licensing)
Celebrity spokesperson (through endorsement advertising)
Events (through sponsorship)
Other third-party sources (through awards and reviews) 30

21. Company branding strategies
Corporate brand associations
Corporate brand visibility/dominance
New brand / modify an existing brand / combine existing and new brand
Product responses (consumer evaluation and behaviour)
Influenced by fit, consumer involvement, perceived risk

22. Country of origin Consumer attitude towards foreign products
French wine, Japanese electronics, Russian vodka, Scottish whiskey, German car, etc…
Made-in-… vs. Manufactured-in-…
But mitigated by trial and direct experience, and moderated by product type, consumer involvement, and other personal values.
Domestic products as well,
Particularly for international marketing, international branding strategy

23. Co-Branding
Occurs when two or more existing brands are combined into a joint product or are marketed together in some fashion
Examples:
Sony Ericsson
Haagen-Dazs & Balleys
Dell Computers with Intel Processors
Dell and Intel: we call ingredients

24. Advantages of Co-Branding
Borrow needed expertise
Leverage equity you don’t have
Reduce cost of product introduction
Expand brand meaning into related categories
Broaden meaning
Increase access points
Source of additional revenue

25. Disadvantages of Co-Branding
Loss of control
Risk of brand equity dilution
Negative feedback effects
Lack of brand focus and clarity
Organizational distractions

26. Licensing
Involves contractual arrangements whereby firms can use the names, logos, characters, and so forth of other brands for some fixed fee
Examples:
Entertainment (Star Wars, Jurassic Park, etc.)
Television and cartoon characters (The Simpsons)
Designer apparel and accessories (Calvin Klein, Pierre Cardin, etc.)

27. Celebrity Endorsement
Draws attention to the brand
Shapes the perceptions of the brand
Celebrity should have a high level of visibility and a rich set of useful associations, judgments, and feelings, also be credible in terms of expertise, trustworthiness, and likeability.

28. Celebrity Endorsement: Potential Problems
Celebrity endorsers can be overused by endorsing many products that are too varied.
There must be a reasonable match between the celebrity and the product.
Celebrity endorsers can get in trouble or lose popularity.
Many consumers feel that celebrities are doing the endorsement for money and do not necessarily believe in the endorsed brand.
Celebrities may distract attention from the brand.

29. Sporting, Cultural, or Other Events
Sponsored events can contribute to brand equity by becoming associated to the brand and improving brand awareness, adding new associations, or improving the strength, favorability, and uniqueness of existing associations.
The main means by which an event can transfer associations is credibility.

30. Third-Party Sources
Marketers can create secondary associations in a number of different ways by linking the brand to various third-party sources.
Third-party sources can be especially credible sources.
Marketers often feature them in advertising campaigns and selling efforts .
Example: J.D. Power and Associates’ well-published Customer Satisfaction Index, Interbrand publish Top 100 brands

31. Leveraging Secondary Associations
Brand associations may themselves be linked to other entities, creating secondary associations:
Company (through branding strategies)
Country of origin (through identification of product origin)
Channels of distribution (through channels strategy)
Other brands (through co-branding)
Special case of co-branding is ingredient branding
Characters (through licensing)
Celebrity spokesperson (through endorsement advertising)
Events (through sponsorship)
Other third-party sources (through awards and reviews) 30

32. What we have achieved? what is brand what is brand equity
five categories of brand equity by Aaker
how to build a brand equity
brand building implications
advantages of strong brands
Building customer-based brand equity
Secondary association