1. Branding, Packaging and Labeling

2. Topics Branding –Importance –Types –Strategies Packaging –Function –Issues Labeling

3. Branding Brand –Name, term, design, or symbol that identifies a business and its products Corporate brands –Identify the business and reflect image across all products –Coca-Cola, Daimler-Chrysler Product brands –Among most important assets and powerful selling elements –Coke, Dodge

4. Brands Brand Name –Words, letter numbers the represent brand –Corvette, Airwalk, FedEx Brand Mark –Logo or symbol Trade Name –Legal name a company uses to conduct business –Dell, Xerox

5. Brands Trade Character –Brand mark as a character with human qualities –Keebler, Doughboy Trademark –Any combination of these that is legally protected –Have been expanding to include sound, color, smell Harley trademarked its engine sound

6. Importance of Branding Builds customer loyalty –Customers pay more for recognized names Assures customer of quality & reduces risk of dissatisfaction Assists in extending lines –Customers more willing to try familiar names

7. Generating Brands Estimated that 75% of companies introduce a new product brand annually In 1999, 79,000 trademarks were registered Global brands often consolidate names –Confusion can result from multiple names for the same product In UK, 3 Musketeers is known as Mars Bar

8. Types of Brands Manufacturer Brands –Producer brands, owned by manufacturer –Gives impression of standard quality, performance & status –Most brands are manufacturer brands 65% of appliances 70% of food 80% of gas 100% of cars

9. Types of Brands Private distributor brands –Store or dealer brands, owned by retail stores –Item is purchased to be sold exclusively at certain stores, i.e. Radio Shack brand –Manufacturer name is not displayed –Higher returns for store –Builds retailer loyalty Craftsman, Kenmore sold only at Sears

10. Types of Brands Generic Brands –Carry no company name, just product description –Sold much cheaper, 30 – 50% lower than manufacturer brands, and 10 – 15% lower than store brands –Jewel supermarkets in Chicago were the first to offer

11. Branding Strategies Brand extension –Uses existing brand name to promote new products –Dilution may become a problem Brand Licensing –Allow other companies to use trademarks for a fee, plus royalties on sales –Enhances image & helps sales of core products

12. Branding Strategies Mixed branding –Offer combination of manufacturer, store & generic brands –Manufacturer will sell under a national brand, then sell extra to a store to be repackaged under a store brand, then make a generic –Maximizes profit by appealing to all segments

13. Branding Strategies Co-Branding –Uses two or more brands to increase loyalty and sales for individual brands –Builds recognition for each, work best if product complement each other Starbucks in Barnes & Nobles Smuckers jelly in Pop-Tarts

14. Packaging Physical container or wrapping –Approximately 10% of retail price is spent on package –In some cases, package is most expensive part of production

15. Function of Packaging Key selling tool Promoting & selling –Reaction to packaging is important to overall success or failure –New designs may not replace old, but complement it Pump soap containers Defining product identity –Invoke prestige, convenience, status, etc.

16. Function of Packaging Provide information –Directions on how to use, warnings, ingredients Meet customer needs –Various sizes for different market segments –Must adapt to meet changing lifestyles

17. Function of Packaging Ensure safe use –Tamper resistance, child proofing –Blisterpacks, molded plastic with foil or cardboard backing Gums and some medicine Protection –Shipping, storage, display –Prevent shoplifting, breakage & spills

18. Contemporary Issues Changing social and political atmosphere leads to changes in product & package –Environmental packaging Surveys indicate consumers will pay more for these packages –Cause packaging Promoting unrelated issues on package, usually socially or politically motivated –Ben & Jerry’s, Body Shop

19. Labeling Informational tag, wrapper, seal or imprinted message Main function is to inform about contents and give directions Protects company from liability & lawsuits

20. Labels Brand label –Gives name, logo & trademark Descriptive label –Gives information about use, construction, care, performance, etc. Does not contain all the information that a consumer might want Grade label –Give product quality

21. Labels Food labels must contain weight, dating and storage information, UPC, etc. –Net weight is entire product minus the weight of package and packing materials –Dating options are Date packed Sell by date – last day it should be sold Best if – last day for best quality Expiration – should not be used after

22. Labeling Laws Public outcry has lead to regulations on what needs to be incorporated on labels Fair Packaging & Labeling Act (FPLA) gives the FDA and FTC authority over labeling Not all countries have the same label laws –Coke was pulled off Italian shelves because they would not list the “secret ingredient”

23. Labeling Laws FDA –Enacted a law to require labels to give information on how the product fits into a daily diet –Developed definitions for light, free, low, reduced and good source –Warning labels on cigarettes and alcohol –Developing regulations for genetically modified foods

24. Labeling Laws FTC –Responsible for ensuring labels are not deceptive –Released guidelines for environmental claims Requires proof for all claims