2 learning objectivesTo understand the importance of secondary brand associations in building brand equityTo understand the concept of leveraging brand entities as secondary brand associations in building brand equityTo understand the implications of leveraging secondary brand associations in managing branding strategies
3 Preview Building brand equity : Marketing Program Activities (4Ps) Brand ElementsMarketing Program Activities (4Ps)Leverage of related or secondary brand associationTo creating strong, favorable, and unique associations or positive responses if existing brand associations or responses are deficient in some way
4 Creating Secondary Brand Knowledge We can create secondary brand knowledge by linking the brand to the following :Companies (through branding strategies)Countries or other geographic areas (through identification of product origin)Channels of distributions ( through channel strategy)Other brands (through co-branding)Characters (through licensing)Spokespersons (through endorsement)Events (through sponsorship)Other third-party sources (through award or reviews)
6 Conceptualizing the Leveraging Process Creation of New Brand AssociationsEffects on Existing Brand KnowledgeAwareness and knowledge of the entityMeaningfulness of the knowledge of the entityTransferability of the knowledge of the entityGuidelinesCommonality: consumers have associations to another entity that are congruent with desired brand associationsComplementary: how much value of the entity brand would add to the existing brand.
8 1. CompanyBranding strategies are an important determinant of the strength of association from the brand to the company and any other existing brands.Three main branding options exist for a new product :Create a new brandAdopt or modify an existing brandCombine an existing and a new brand
12 Virgin Core Values :Value for moneyQualityInnovationFunSense of competitive challenge
13 2. Country of Origin and Other Geographic Areas The country or geographic location from which it originates may also become linked to the brand and generate secondary associationsMany countries have become known for expertise in certain product categories or for conveying a particular type of imageConsumer can pick and choose brands originating in different countries, based on their beliefs about the quality of certain types of products from certain countries or the image that these brands or products communicate
16 3. Channels of Distribution Channels of distribution can directly affect the equity of the brand they sell because of consumers association linked to the retail stores.Because associations to product assortment, pricing and credit policy, quality of service, retailers have their own brand images in consumers minds
20 4. Co-BrandingExisting brand leverage associations by linking itself to other brands from the same or different companyCo branding or brand bundling or brand alliances: when two or more existing brands are combined into a joint product or are marketed together in some fashion.Guidelines :Both brands should have adequate brand awareness, sufficiently strong, favorable , unique associations, positive consumer judgments and feelingsLogical fit between the two brands and combined to maximizes the advantages of the individual brands while minimizing the disadvantagesMarketers must ensure the right kind of fit in values, capabilities, and goalsMarketers need detailed plans to legalize contracts, make financial arrangement , and coordinates marketing program
23 Special case : Co-Branding Ingredient Branding : creates brand equity for materials, components, or parts that are necessarily contained within other branded products.Guidelines :Consumers must first perceive that the ingredient matters to the performance and success of the end product. The intrinsic value is visible or easily experiencedConsumers must then be convinced that not all ingredient brand are the same and that the ingredient is superior. The ingredient would have an innovation or some other substantial advantage over existing alternativesA distinctive symbol or logo must be designed to clearly signal to consumers that the host product contains the ingredient. The symbol or logo would function essentially as a “seal” and would be simple and versatile it could appear virtually anywhere and credibly communicate quality and confidence to consumersA coordinated push and pull program must be put into place such that consumers understand the importance and advantages of the branded ingredients
25 5. LicensingLicensing creates contractual arrangements whereby firms can use the name, logos, characters, and so forth of other brands to market their own brands for some fixed fee.Renting another brand to contribute to the brand equity of its own product.Corporate trademark licensing :Generating extra revenues and profitsProtecting their trademarksIncreasing brand exposureEnhancing brand imageNo inventory expenses, Account receivable, manufacturing expensesRisk : product wont live up to the reputation established by the brand; inappropriate licensing will dilute brand meaning
27 6. Celebrity Endorsement Using well known and admired people to promote products is a widespread phenomenon with a long marketing historyPotential Problems :Celebrity endorsers can endorse so many products that they lack any specific product meaning or are seen as opportunistic or insincereMust be reasonable match between the celebrity and productCelebrity endorsers can get in trouble or lose popularity diminishing their marketing value to the brandGuidelines :Marketer should strategically evaluate, select, and use celebrity spokespeopleChose a well known celebrityThere must be logical fit between the brand and personAd and communication program should use the celebrity in a creative fashion that highlights the relevant associations and encourages their transfer
29 7. Sporting, Cultural, or Other Events Events have their own set of associations that may become linked to a sponsoring brand under certain conditions.Sponsored events becoming associated to the brand and improving brand awareness, adding new associations, or improving the strength, favorability, and uniqueness of existing associations.