BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 4B Brand Management and the Firm Brand Equity Models ALAN L. WHITEBREAD.

BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 4B Brand Management and the Firm Brand Equity Models ALAN L. WHITEBREAD

SEVEN BRAND MANAGEMENT APPROACHES
Economic Identity Consumer-based Personality Relational Community Cultural

COMPANY SENDER FOCUS THE ECONOMIC APPROACH
Manages the brand with the traditional marketing mix Company identity helps shape a brand message Marketer is in charge of brand value creation A consumer is an “economic man” passively receiving and understanding messages from the sender exactly as intended.

COMPANY SENDER FOCUS Economic approach – The economic man
Human behavior is rational Humans maximize their satisfaction and/or utility [self-interest is important] Humans have perfect market information The exchange is an isolated event and not related to any other event Humans have limited income which causes them to maximize the utility of their income

COMPANY SENDER FOCUS THE IDENTITY APPROACH
Brand is integrated into all organizational levels Organizational culture and corporate identity heavily influence the brand

HUMAN RECEIVER FOCUS THE CONSUMER-BASED APPROACH
Brand is linked to customer associations Focus shifts to the message receiver Marketer can program the consumer through brand messages

CONSUMER-BASED BRAND EQUITY [CBBE]
Ensure consumers identify and associate the brand with a specific type of product or solution. Establish the brand in the mind of the consumer through associations to certain properties. Assure brand identification and brand meaning are accurate.

HUMAN RECEIVER FOCUS Consumer-based approach
The brand is a consumer mental construct The consumer is the owner of the brand Marketer can program the consumer through brand messages

CUSTOMER-BASED BRAND EQUITY PYRAMID
RESONANCE SALIENCE Projecting the brand JUDGMENTS FEELINGS PERFORMANCE IMAGERY 4. RELATIONSHIPS 3. RESPONSE 2. MEANING 1. IDENTITY

BRAND IDENTITY Brand salience How often is the brand recalled?
RESONANCE SALIENCE Projecting the brand JUDGMENTS FEELINGS PERFORMANCE IMAGERY Brand salience How often is the brand recalled? Is it easy to recall? What reminders are necessary? Dimensions of brand awareness Depth: the likelihood of recall Breadth: the range of purchase opportunities How effective are the brand elements? Identify and differentiate each one

BRAND MEANING Brand performance
RESONANCE SALIENCE JUDGMENTS FEELINGS PERFORMANCE IMAGERY Brand performance Primary product and supplementary features Product reliability, durability, and serviceability Style and design Value proposition using emotional and intangible elements [not price]

BRAND MEANING Brand imagery User profiles
RESONANCE SALIENCE JUDGMENTS FEELINGS PERFORMANCE IMAGERY Brand imagery User profiles Demographics, psychographics, … Purchase and usage situations Channel, store, timing, … Personality and values Sincerity, excitement, competence, … History, heritage, and memorable experiences

BRAND RESPONSE Brand judgments Brand quality Brand credibility
RESONANCE SALIENCE JUDGMENTS FEELINGS PERFORMANCE IMAGERY Brand judgments Brand quality Value, satisfaction, … Brand credibility Expertise, trustworthiness, likeability, … Brand consideration As a relevant solution, … Brand superiority Differentiation, associations, …

BRAND RESPONSE Brand feelings Warmth Fun or excitement Security
RESONANCE SALIENCE JUDGMENTS FEELINGS PERFORMANCE IMAGERY Brand feelings Warmth Fun or excitement Security Social approval Self-respect

BRAND RELATIONSHIPS Brand resonance Behavioral loyalty
SALIENCE JUDGMENTS FEELINGS PERFORMANCE IMAGERY Brand resonance Behavioral loyalty Frequency of repeat purchases Attitude attachment Strong affection, pride of ownership, … Sense of community affiliation Active engagement Regularly involved with some aspect

CUSTOMER-BASED BRAND EQUITY PYRAMID
RESONANCE What about you & me? JUDGMENTS What about you? FEELINGS PERFORMANCE What are you? IMAGERY SALIENCE Who are you?

HUMAN RECEIVER FOCUS Personality approach
Humans endow the brand with a human character / personality, thus giving it symbolism A prerequisite for the relational approach Models David Aaker’s Brand Equity Model Brand Personality [more in Section 7] and Corporate Brand Personality

DAVID AAKER’S BRAND EQUITY MODEL
Brand equity is composed of distinct categories of brand assets and liabilities. Brand loyalty Brand awareness Perceived quality Brand associations Other proprietary brand assets

BRAND LOYALTY Reduced [marginal] marketing expenses Provides trade leverage [with resellers] The ability to attract new customers and keep existing ones Provides time to respond to competitive threats

BRAND AWARENESS It is an anchor to which you can attach other associations It is familiar It is an indicator of commitment to the brand It indicates the brand should be considered if not already a customer

PERCEIVED QUALITY Provides a reason to buy Differentiates the brand and its products Part of the positioning Provides value Provides the opportunity for extensions

BRAND ASSOCIATIONS Helps with information retrieval Provides a reason to buy Creates positive attitude or feelings Provides the opportunity for extensions

OTHER PROPRIETARY BRAND ASSETS Establishes competitive advantage

BUILDING A BRAND Have a strong core brand identity that can be modified for different segments and products. Have a strong value proposition using emotional and intangible appeals. Establish a strong brand positioning that links to the brand identity. Great execution NPD, launch, product / family life cycle

BUILDING A BRAND Be consistent over time Coca-Cola vs. RC Cola Use the brand leverage that has been developed – only participate in strong co-branding programs Measure and track various brand equity elements over time Have a strong brand manager Invest in the brand

PRODUCT BRAND PERSONALITY
Defined in user imagery Understand the characteristics of customers Customers can express their actual or desired self-image by association with the product

CORPORATE BRAND PERSONALITY
Defined in the actions, values, and words of all its employees Supersedes any product brand personality Core dimensions [traits] Heart [passionate and compassionate] Mind [creative and disciplined] Body [agile and collaborative]

BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 5 Brand Management and the Firm Brand Types and Characteristics ALAN L. WHITEBREAD

THE FOUR STEPS OF BUILDING A BRAND
Brand identity Who are you? Brand meaning What are you? Brand response How do I think or feel about you? Brand relationships What type of a connection do we have?

BUILDING A BRAND BRAND IDENTITY FORMS
The company is the only brand name used ? The company and the brand are together DuPont, IBM, Philips, Siemens The brand by Company X The brand with minor mention of Company X Clairol, Crest, Folgers, Noxzema, Pampers, Puffs, Tide – Proctor and Gamble The brand represented / distributed by X

TYPES OF BRANDS GENERIC CORPORATE / FAMILY INDIVIDUAL / PRODUCT
Pharmaceuticals, Vegetables CORPORATE / FAMILY Nike, IBM, GE, RCA TYPES OF BRANDS INDIVIDUAL / PRODUCT Huggies, P&G soaps, Crest COMBINATION HP Deskjet, DuPont Stainmaster CO-BRANDING Post Oreo O’s cereal, Disney SUV PRIVATE LABEL Kenmore, Craftsman, Die-Hard Great Value, … BRAND LICENSE Disney

PRIVATE LABEL BRANDS Are generally a threat only to brands that are
The value equation is wrong because the real or perceived benefits are not sufficient. Very small IMC relative to what is needed to build or sustain a brand. Very poor differentiation [if any] and probably some combination of bad POP, IMC, …

PRIVATE LABELS: SOME DISHWASHERS
Maytag® Admiral Jenn-Air® Jenn-Air Pro-Style® Magic Chef Maytag Jetclean®III Maytag Jetclean®II Maytag Jetclean® Norge Hardwick GE® GE® GE ProfileTM GE SpacemakerTM Hotpoint® GE Monogram® Kenmore Electrolux® Electrolux Icon Gibson Kelvinator White-Westinghouse Frigidaire Frigidaire Gallery Frigidaire Professional Tappan® GE Whirlpool® Roper® Estate® Whirlpool Gold® KitchenAid® KitchenAid BRIVA® [In-sink dishwasher] Kenmore Elite Kenmore UltraWash® See for more. See for a list of firms.

PRIVATE LABEL BRANDS PRIVATE LABEL NOTES
Some people differentiate a private label brand as one that identifies the source of the product and a generic brand as one that does not identify the source. Private labels are called store brands for retailers. Private labels for wholesalers and distributors may or may not have detailed specifications and identify the source of the product.

BUILDING A BRAND PRIVATE LABEL BRANDS Manufacturer’s brands [OEM]
Manufacturer A makes products for Manufacturer B so the market believes Manufacturer B is making the products. ? Reseller’s brands B2B Nearly all mail order firms B2C Sears Craftsman tools, DieHard batteries, and Kenmore appliances

BUILDING A BRAND PRIVATE LABEL BRANDS Counter brands or Generic brands
Usually the same ingredients as the major brand and imitates it in nearly all aspects – same size package, information is identical and in the same place, etc. Wal-Mart Equate Fakes or Knock-offs Illegal versions of usually major brands CDs, movies, software, …

B2B BRANDS Most are unknown by the average consumer.
Known: Alcoa, Intel, Unknown: FMC, Lexan, TIVAR Important considerations Company reputation and financial stability Capacity, flexibility, service level[s] NPD

POSITIONING: BRAND IDENTITY
Vision [includes purpose / need fulfillment] What makes it different? What makes it recognizable? This is a part of but not the same as identity As seen from sender’s side! Sight Graphic symbol [logo] Sound Name Must penetrate the noise.

BRAND IDENTITY TRAPS Each of these approaches is too limiting or tactical. How the brand is currently perceived [The customer determines who you are] How we want the brand to be perceived [Must be a visionary positive projection] The part of the brand identity and value proposition that is communicated to the target audience. [focus on attributes [features] restricts the brand identity

POSITIONING: BRAND IMAGE
Brand image [as seen from receiver’s side] Perceptions of the product Must not be distorted by the noise If you are doing a great communications job, brand image will be very close to the brand identity. Understanding the receiver’s side Use a Mental map / Mind map A graphical technique that takes advantage of the brain associative capability not just is linear capability.

MIND MAP 7-Up Sweet Sticky Children Bittersweet Lemon Adult Fresh
Thirst quencher Carbonated Sparkling Cool

POSITIONING: MIND MAP TOOL
To effectively use this technique Get a very large sheet of paper. Put the central idea at the center of the paper. Write down every association where it first appears to belong. Draw all known connections between ideas with various arrows, lines, markers, symbols, colors, etc. Go very quickly. NEVER PAUSE, JUDGE, OR EDIT DURING THE MIND MAP SESSION! This maximizes the number of associations and minimizes the linear thinking aspect of the brain.

REMEMBER THE BENEFITS OF STRONG BRANDS
Increased customer loyalty Increased brand recognition Stronger competitive position Larger gross and pre-tax margins Increased trade cooperation Increased IMC effectiveness

REMEMBER – STRONG BRANDS PROVIDE POTENTIAL FOR
a corporate brand brand extensions product line extensions

POSITIONING: FIRST STEPS
Four key questions must be answered before you begin to evaluate positioning alternatives. Why does the brand exist? Who is the brand for? Market segmentation; market descriptions Why are the benefits meaningful? What are we competing against? SWOT analysis; competitive analysis; product charts

Why does the brand exist? The brand vision [brand promise for the consumer]. Brand benefits must be rank ordered by perceived value for each target market [segment]. Who is the brand for? Precise market segmentation and target marketing are required.

Why are the benefits meaningful? What proof exists? How are those messages conveyed? What are we competing against? You must understand the nature of competition. By level [direct, various indirect] By product for direct competitors By company [by probability of competing]

SELECTING BRAND ELEMENTS
Six criteria should be used to do this. Meaningful / descriptive / interesting / rich in visual and verbal imagery Likeable aesthetically and emotionally Transferable within and across product, geographic, or cultural boundaries Adaptable, flexible over time to keep from becoming stale or outdated

A SUCCESSFUL BRAND When you have positioned a brand correctly, it has all of the following characteristics. Recall [physically, imagery, familiarity] Personality [character] Culture [group] Relationship [meaning to the customer] Customer reflection [perception] Self-image

BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 6 Brand Management and the Firm New Product Development: Risk Assessment ALAN L. WHITEBREAD

REASONS FOR NPD Capitalize on existing market[s]
Capitalize on new technology Erect competitive barriers Establish a market presence Expand the product offering Improve the company’s image Increase market penetration Preemptive move in an emerging segment Lower cost / higher value product Offset a seasonal cycle Utilize excess capacity …

NEW PRODUCT DEVELOPMENT [NPD]
NPD is risky and expensive. More than 9 out of 10 new products fail in the first year. Food Industry 1997 first year failure rate Top 20 firms success rate is 76% Food industry failure rate is nearly 80% Large firm vs. small firm NPD performance Medicines: Of 5,000 Only 5 make it to clinical trials Only 1 is approved for patient use U.S Fortune 1000 firms Spend more than $60 billion in new product failures each year. Even if a product survives its first year, it is likely to fail in the second year.

NEW PRODUCT DEVELOPMENT [NPD]
New product development is cross-functional Marketing identifies unfilled customer needs Marketing specifies the type of product that is needed R&D develops conceptual alternatives for marketing to approve R&D, engineering, and production develop the product with marketing’s guidance Finance verifies the estimated cost and profitability

MITIGATING RISK Companies are faced with increasing levels of risk in today’s market. You must develop and introduce products faster! Competitors have speeded up their NPD cycles. Product life cycles are shortening, increasing risk because: more new products must continually be in development, and there is less time to capture development costs and generate profits. New product development is expensive. A large percentage of all quality problems stem from poor design. Most of a new product's cost is determined during the design stage.

KEYS TO NEW PRODUCT SUCCESS “THE DIMENSIONS OF INDUSTRIAL NEW PRODUCT SUCCESS AND FAILURE”, R. G. Cooper, Journal of Marketing, Vol. 43 (Summer 1979), pp Product uniqueness and [perceived] superiority Market knowledge and marketing proficiency Technical and production synergy and proficiency

CRITICAL GENERAL SUCCESS FACTORS FOR NEW PRODUCTS
Exceptional product quality Quality leader Superior to competitors perceived ability to meet a need or solve a problem Unique benefits that are highly visible, easily understood, and

CRITICAL SUCCESS FACTORS: PROJECT LEVEL
Unique [perceived] superior products Market research Clear, early, and stable project and product definitions Planning and resourcing the launch Excellent execution from idea forward

CRITICAL SUCCESS FACTORS: PEOPLE AND THE ENVIRONMENT
Organizing the right project team Strong team chemistry Outstanding leadership

Self-motivation [3M intrapreneurship]
QUALITIES PROMOTING CREATIVITY “A MODEL OF CREATIVITY AND INNOVATION IN ORGANIZATIONS”, Teresa M. Amabile, Research in Organizational Behavior, Vol. 10, pp Personality traits Persistence, curiosity, energy, and intellectual honesty Self-motivation [3M intrapreneurship] Self-driven and committed to the idea Cognitive abilities General problem-solving, tactics for creative thinking

Risk-orientation [Norm Dion, Dysan Corp.]
QUALITIES PROMOTING CREATIVITY “A MODEL OF CREATIVITY AND INNOVATION IN ORGANIZATIONS”, Teresa M. Amabile, Research in Organizational Behavior, Vol. 10, pp Risk-orientation [Norm Dion, Dysan Corp.] Unconventional, attracted to challenge, do things differently Expertise in the area [Al Shugart, Finis Conner] Talent, experience, and knowledge in a field Qualities of the group Synergy of intellectual, personal and social qualities of the group

QUALITIES INHIBITING CREATIVITY “A MODEL OF CREATIVITY AND INNOVATION IN ORGANIZATIONS”, Teresa M. Amabile, Research in Organizational Behavior, Vol. 10, p. 129. Unmotivated Not challenged by the problem, pessimistic, complacent, lazy, do not believe in the idea Unskilled Lack of ability or experience in the problem area Inflexible Opinionated, unwilling to do things differently

ENVIRONMENTS FOR CREATIVITY “A MODEL OF CREATIVITY AND INNOVATION IN ORGANIZATIONS”, Teresa M. Amabile, Research in Organizational Behavior, Vol. 10, pp Freedom of what to do or how to do #2 for inhibiting creativity Good project management Sufficient resources Organizational characteristics Cooperation and collaboration Failure is not fatal #1 for inhibiting creativity

THE POWER OF VISUALIZATION
On the internet find any or all of the following to appreciate visualization.

CRITICAL SUCCESS FACTORS: PEOPLE AND THE ENVIRONMENT
Organizing the right project team Strong team chemistry Outstanding leadership Provide a supportive corporate environment Climate Culture Top management support

B2C TARGET MARKET SEGMENT CRITERIA
Measurable - Is it quantifiable ? 2. Substantial - Is it the right size for my firm? Accessible - Does it use our existing channels of distribution? Heterogeneous - Is it differentiable? Are there obvious customer benefits? Actionable - Does my firm have a committed long-term desire to succeed?

B2B TARGET MARKET SEGMENT CRITERIA
Measurable The degree to which you can measure buyer characteristics Accessible The ability to focus on target market segments Substantial The degree to which target market segments are large enough and potentially profitable enough to pursue

B2B TARGET MARKET SEGMENT CRITERIA
Compatible -The extent to which marketing and business strengths compare to current and expected competitive and technology states Responsive -The extent to which target market segments respond to elements of the marketing mix

WHAT IS A NEW PRODUCT? Product improvements and modifications.
A different Size Color Style Specifications Package A new product family or product line A new SBU Products that require a new technology …

FIVE TYPES OF DEVELOPMENT PROJECTS
LARGE HARDEST P R O C E S H A N G R&D ADVANCED DEVELOPMENT PROJECTS: GENETIC ENGINEERING NEW CORE PRODUCT NEXT GENERATION PRODUCT ADDITION TO PRODUCT FAMILY DERIVATIVES AND EXTENSIONS ALLIANCES PARTNERSHIPS PROJECTS NEW CORE PROCESS BREAKTHROUGH PROJECT: NEW FAMILY OF DRUGS R&D JOINT VENTURE NEXT GENERATION PROCESS SINGLE DEPARTMENT UPGRADE PLATFORM PROJECT: APPLE iMAC: TRANSLUCENT PLASTIC COLORATION TECHNOLOGY INCREMENTAL CHANGE DERIVATIVE PROJECT: SIMPLE SIZE CHANGE MORE PRODUCT CHANGE LESS EASIEST SMALL For more information see Creating Project Plans to Focus Product Development, Harvard Business Review, Vol. 70, No. 2, p.74.

NPD New product development begins with the recognition of
an unmet customer need or want and a potential market [segment] that is large enough to justify exploration. NPD proceeds either in a sequential or concurrent fashion. Sequential [completing one step before proceeding to the next] NPD is the traditional method. It is time consuming, thus slow. The lack of speed to market results in either not as much of a lead over competitors or it trails them further in the market. Either way, the firm does not realize as much profit from NPD as it could.

NPD: A STAGE-GATE PROCESS
-Conduct necessary research [discovery] -Determine the type of project [scoping] Gain project approval Development activities Testing and validating

WHERE DO IDEAS COME FROM?
MARKET RESEARCH / CUSTOMERS / PROSPECTS / EMPLOYEES SUPPLIERS ACQUISITIONS UNDERSTANDING TRENDS / ISSUES / … Demographics Problems Competition Market research Technology

NEW PRODUCT IDEA STRATEGIES
Acquire Companies Original Products Acquire Patents Product Improvements Acquire Licenses Product Modifications New Brands

METHODS OF IDEA GENERATION
METAPHOR BUILDING FREE ASSOCIATION Fruit → Banana → Yellow → ? + Fruit → Banana → Orange → ? + BRAINSTORMING CATALOG TECHNIQUE ATTRIBUTE LISTING THINKING OUT OF THE BOX Techniques for creative thinking

ANSOFF’S PRODUCT / MARKET EXPANSION GRID
Existing products New products 1. Market Penetration / Saturation 2. Product Development Existing markets 3. Market Development 4. Diversification New markets

PRODUCT GENERATION MAP: HP
DeskJet 560C Cost reduction DeskJet 300 Portable with small footprint DeskJet 550C One color and one black cartridge DeskJet 500C Swap color and black cartridges DeskJet Plus Cost reduction Quality improvement DeskJet TIME

TECHNOLOGY ROADMAP Technology area Last year This year +1 year
+2 years Vision Weight/size 16-bit chip Micro controller Integrated unit Single chip Soft radio Ease of use 4 line screen 10 line screen VGA Touch screen Voice interface Longevity Audio quality Video quality

CONCEPT SCREENING Sort and classify by type of project
Concept Screening: Does it fit with the portfolio? Form, function, design, aesthetics ? Risk analysis Technological Technology demands, engineering, operations, and quality Business Business analysis

Ø THREE KEY QUESTIONS Who? What? Where? Why? When? How?
How is it differentiated?

Ø THREE KEY QUESTIONS 2. Utilizing which core competency[ies]?
Utilizing which key success factor[s]? What operating model? How will it be made? What are the key hurdles?

Ø THREE KEY QUESTIONS 3. Projected units
Projected net revenue [including elasticity] Projected cost schedules Projected profitability Risk assessment – the potential to make considerably more or less than the projection[s]

BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 7A Brand Management and the Firm Market Research ALAN L. WHITEBREAD

MARKET RESEARCH OVERVIEW
The collection and analysis of data for market decisions about COMPETITORS MARKETS PRODUCTS RESPONDENTS STRATEGY OPTIONS Strategic Marketing for Evaluation data for -Strategy analysis -New business analysis Market Planning for Market segmentation Market potential / share Competitive analysis Product Management for New or enhanced products 4 P's decisions Product Development for Product concept testing Sales techniques Price testing

FRAMING AN ISSUE

McKinsey & Company “Breakthrough Thinking from Inside the Box”, HBR, December, 2007, pp Create new boxes to think inside Bound the range of acceptable ideas Tailor the questions accordingly Select participants capable of original insight “21 Great Questions for Developing New Products”

ELEMENTS OF A GOOD QUESTIONNAIRE
Most are short, simple, and quick – but some can be quite long Precise wording of questions and answers Avoids leading questions Does not ask unreasonable questions Does not alienate the respondent Sensitive topics = ? Readily lends itself to statistical analysis

THE QUESTION MUST BE VERY CAREFULLY WORDED AND STRUCTURED
THE QUESTION MUST BE VERY CAREFULLY WORDED AND STRUCTURED! THE STRUCTURE OF THE ANSWER IS JUST AS IMPORTANT AS THAT OF THE QUESTION!

TYPES OF QUESTIONS DICHOTOMOS QUESTION
THE RESPONDENT MUST ANSWER ONE OF JUST TWO CHOICES DO YOU THINK TIDE GET CLOTHES CLEAN WITHOUT INJURING THE FABRIC? YES NO

TYPES OF QUESTIONS OPEN-END or COMPLETELY UNSTRUCTURED QUESTION
OBTAINS INFORMATION WITHOUT BIAS IT IS LIKE AN ESSAY EXAM IT IS VERY HARD TO ANALYZE FREE RESPONSE QUESTION ANSWERS ARE LIMITED TO A WORD OR A PHRASE

TYPES OF QUESTIONS SENTENCE COMPLETION QUESTION
THE ______ IS OBTAINED BY DIVIDING ______ BY ______. GOOD FOR ROTE MEMORY MEASUREMENT THE RISK IS THAT IS ALL THEY MEASURE!

TYPES OF QUESTIONS MULTIPLE CHOICE QUESTION – you must know everything about an issue to properly write these structured questions. 1-VERY EASY ANSWER SET ONE CORRECT ANSWER 2-TO MEDIUM HARD ANSWER SET SEVERAL ANSWERS ARE ONLY SLIGHTLY DIFFERENT 3-TO HARD ANSWER SET COMBINATION ANSWERS ONLY SLIGHTLY DIFFERENT

TYPES OF QUESTIONS RANKING, RATING, and CONTINUUM QUESTIONS
FORCE A MORE PRECISE SCALE OF MEASUREMENT SCALE DETERMINES TYPE OF STATISTICAL ANALYSIS PROBLEM IS THE MEANING OF THE SCALE OF MEASUREMENT CHECK QUESTIONS

QUALITATIVE RESEARCH Words and images “Soft” or subjective data
Exploratory in nature Understand unmet needs Heuristic analysis: search for themes and deeper meanings

COMPETITIVE ANALYSIS Traditional competitors Evolving competitors
New competitors to the industry The growing role of strategic alliances Notes ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

COMPETITIVE ANALYSIS Company #1 #2 #3 #4 #5 #6 #7 #8 #9 #10 4 User $
OUR COMPANY Y N GUI Win 5,000 MCS ? CLI Unix DMCS PROP 12,000 AS API 5,080 PCSS 7,460 MAC FMSI HTC 3,980 LEGEND: Y=yes N=no GUI=graphic user interface CLI=command line interface PROP=proprietary

PRODUCT LINE EXPLOSION

PRODUCT LINE EXPLOSION
Look at what happens with only a little changes to the previous slide. Brands*types*sizes*collars*colors 1*4*8*2*4 = 3*4*8*2*6 = 1,152

CONTEXTUAL RESEARCH CONTEXT -Activities -Environment -Interactions
-Other products -People -Processes -Relationships

CONTEXTUAL RESEARCH: PRINCIPLES
Empathy for understanding Rapport for true behavior and values Subjects lead the session and identify what is important Focus on what subjects do more than their opinions General patterns should emerge

CONTEXTUAL RESEARCH: THE PROCESS
Defining the problem and research objectives Developing the research plan Collect the information Analyze the Present the findings Marketing Decisions

QUALITATIVE TECHNIQUES
INTERVIEW USERS FREE ASSOCIATION What does _________ mean to you?

QUALITATIVE TECHNIQUES
FOCUS GROUPS How do they work? PROJECTIVE TECHNIQUES Completion and interpretation tasks Comparison tasks To try and uncover true opinions and feelings Example: Rorschach Test [inkblot]

CONCEPT TESTING: What ideas should we pursue?
The unmet need or want “The universal carryall” What is it? How should it work? Feature[s] = ? Advantage[s] = ? Benefit[s] = ? “The universal carryall”

CONCEPT TESTING: What ideas should we pursue?
Test as many ideas as possible Test before any feasibility analysis Do not mix innovative and very futuristic ideas in the same test set

BRAND ATTRIBUTES AND BENEFITS
User imagery Usage imagery Product-related attributes Brand personality PRODUCT OR SERVICE Symbolic benefits Functional benefits Experiential benefits

TTU DELOITTE PROJECT, FALL 2008

SCALES OF MEASUREMENT SCALE STRUCTURE EXAMPLE(S) 1:1 correspondence
1:1 correspondence Subjective data Football numbers Lottery drawing numbers A scale exists No distance relation is known (e.g. 3-2 <> 4-3) Military rank Quality of lumber, beans Upper-middle-lower class Ordinal scales are often used to evaluate consumer satisfaction. [Likert scale] How satisfied are you with PRODUCT X? Not satisfied Neither satisfied or dissatisfied Satisfied Very satisfied Extremely satisfied

Equal distances between items
SCALES OF MEASUREMENT SCALE STRUCTURE EXAMPLE(S) Equal distances between items (e.g. 4-2=4-3) Calendar days Temperature Equal distances between items (e.g. 3-2=4-3) Calendar days Temperature Interval scales are often used to rank items. Which products do you prefer the most? Assign #1 to the most preferred and #5 to the least preferred product. PRODUCT A _____ PRODUCT B _____ PRODUCT C _____ PRODUCT D _____ PRODUCT E _____ A continuous scale of measurement Definite relationships A true zero point Measurement Loudness scale

BRAND PERSONALITY IF PRODUCT __________ WAS YOUR FRIEND,
HOW WOULD IT TALK TO YOU?

THE BRAND PERSONALITY APPROACH
SUPPORTING THEME: Personality SUPPORTING THEME: Brand-self congruence BRAND PERSONALITY SUPPORTING THEME: Consumer self

BRAND PERSONALITY: Supporting theme: personality
Recessive personality Personality dimensions Dominant personality Quiet, reserved, shy, silent, withdrawn EXTROVERSION Talkative, active, energetic, outgoing Fault-finding, cold, unfriendly, quarrelsome, hardhearted AGREEABLE Sympathetic, kind, appreciative, affectionate, softhearted Careless, disorderly, frivolous, irresponsible, slipshod CONSCIOUSNESS Organized, thorough, efficient, responsible Tense, anxious, nervous, moody, worrying EMOTIONAL STABILITY Stable, calm, contented, unemotional Commonplace, narrow interests, simple, shallow, unintelligent OPENNESS / CULTURED Wide interests, imaginative, intelligent, original, insightful

BRAND PERSONALITY Brand Personality Central Theme Sincerity Excitement
Competence Sophistication Ruggedness Hallmark Coke Pepsi HP Wall Street Journal BMW Lexus Grey Poupon Nike Wells Fargo

THE POWER OF PASSIONS The brand is what makes a product more than just a product – it makes it unique. The brand goal is to be more than brand preference – a passionate brand insistence! This is done through engagement and fulfilling self-concept and image to others.

CONNECTING WITH CONSUMERS
B2C Needs and wants Emotions and self-actualization Hopes [dream realizations] Fears [risk reduction, safety] Familiarity and trust [brand loyalty] Understanding demographic trends

CONNECTING WITH CONSUMERS
B2B connections Performance and reward [best solution] Fears [risk reduction, improve safety] Familiarity and trust [consistency → brand loyalty] Understanding trends

BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 7B Brand Management and the Firm Market Research ALAN L. WHITEBREAD

QUANTITATIVE RESEARCH
Numbers based “Hard” data More confirmatory in nature Optimize the appeal of new products Statistical analysis

QUANTITATIVE TECHNIQUES
ANALYSIS OF VARIANCE [ANOVA] Closely related to multiple regression Can examine multiple variables and their influence on some response Analysis of - 1:A, 2:B, 1: [A & B], [1 & 2]: [A & B], etc. CONJOINT ANALYSIS Many tools including variance and regression analysis Allows many variables and aspects to be analyzed simultaneously Human perceptions and preferences to single attributes and interactions such as price point, sales likelihood, and cannibalization CORRESPONDENCE MAPPING Graphically represent the relationship between brands or products and other variables such as psychographics, media, etc.. Can be a preliminary step to cluster analysis, used in determining the most discriminatory psychographic statements

QUANTITATIVE TECHNIQUES
FACTOR ANALYSIS A data reduction technique to explain variability of factors Finds commonality in sets of variables Used to identify consumer lifestyle and personality types PRINCIPAL COMPONENT ANALYSIS [PCA] A type of factor analysis Used to identify the most independent variables and relative strength/position of a set of linear variables MULTIDIMENSIONAL SCALING Similar to factor analysis Human perceptions and preferences in relative perceptual space [e.g. perceptual map]

FACTOR ANALYSIS AND PCA Deloitte study 2009
Rotated Factor Analysis [PCA] Rotated Common Factor Analysis Factor 1 by Sex; Single MALE FEMALE Exterior design 0.7829 0.5233 0.5833 GPS system 0.4914 Fuel efficiency 0.6915 0.4410 Horsepower 0.7468 0.6816 iPod link 0.5497 Leg room 0.5856 0.6206 0.4816 Newest model 0.5113 Performance 0.8633 0.5986 0.7602 Quietness inside 0.8159 Responsiveness / handling 0.8902 0.6436 0.7513 Sound system 0.5224 0.6015 0.4585 Steering wheel controls 0.4122 0.5275 Tells you when it needs service 0.7664 0.4054 Type of transmission 0.4497 0.4244 See what happens when you force the results to only one attribute!

CORRESPONDENCE MAPPING 0 Degree Angle: 100% Correlation
AWKWARD ABSENTMINDED FORGETFULUL MONEY IS THE BEST MEASURE OF SUCCESS MAGAZINES MAIN SOURCE OF ENTERTAINMENT MAXWELL HOUSE REG GRND READ INFO ON LABEL MOST MAGAZINES ARE WORTH THE MONEY WIN LOTTERY WOULD NEVER WORK AGAIN JOB SECURITY IS MORE IMPORTANT LITTLE I CAN DO TO CHANGE MY LIFE MAXWELL HOUSE INST MAKE SURE I TAKE EXERCISE REGULAR ON WHOLE PEOPLE GET WHAT THEY DESERVEE PAY ANYTHING WHEN IT I AM A WORKAHOLIC CONCERNS MY HEALTH ADV GIVES TRUE PICTURE Maxwell House Regular Ground & Maxwell House Instant have a nearly 100% positive correlation, meaning if you buy more of one, you buy more of the other (the brands are perceived very similar in the marketplace).

CORRESPONDENCE MAPPING 90 Degree Angle: 0% Correlation
CHIPS AHOY CHUNKY CABLE TV HAS TOO MANY CHANN; NEVER KNOW LISTEN TO RADIO FOR QUICK NEWS UPDATE BUY PRODS USE RECYCLE SPANISH ADS RESPECT MY HERITAGE PLAN AHEAD FOR EXP PURCHASES I ENJOY TAKING RISKS NO GOOD AT SAVING MONEY SHOP FOR SPECIALS COMPUTERS CONFUSE ME WILL NEVER GET USEE MUCH INFO AS POSS BEFOR BUY ELECT ITEM LOYAL TO COMPANIES WITH ADS IN SPANISH Chips Ahoy Chunky and Oscar Mayer Hot Dogs form near a 90 degree angle and therefore have no correlation. OSCAR MAYER HOT DOGS

CORRRESPONDENCE MAPPING 180 Degree Angle: 100% Negative Correlation
AWKWARD ABSENTMINDED FORGETFULUL MONEY IS THE BEST MEASURE OF SUCCESS MAGAZINES MAIN SOURCE OF ENTERTAINMENT MAXWELL HOUSE REG GRND READ INFO ON LABEL MOST MAGAZINES ARE WORTH THE MONEY WIN LOTTERY WOULD NEVER WORK AGAIN JOB SECURITY IS MORE IMPORTANT LITTLE I CAN DO TO CHANGE MY LIFE MAKE SURE I TAKE EXERCISE REGULAR ON WHOLE PEOPLE GET WHAT THEY DESERVEE PAY ANYTHING WHEN IT I AM A WORKAHOLIC CONCERNS MY HEALTH ADV GIVES TRUE PICTURE Maxwell House Regular Ground and Starbucks are opposite, meaning they have a negative correlation. If you buy more of one brand, you buy less of another (brands are perceived as opposites in the market). This is particularly helpful when looking at competitors in a market. STARBUCKS

CLUSTER ANALYSIS USED FOR SEGMENTING MARKETS BY GROUPING INDIVIDUALS WITH SIMILAR RESPONSES INTO DISCRETE GROUPS. Respondents will be more like their group than outside their group, e.g., no overlap. There is a greater probability of being in one group than any other. A POWERFUL STATISTICAL TOOL FOR UNDERSTANDING CHARACTERISTICS AND RELATIONSHIPS.

CLUSTER 3: TOP MAGAZINES
CONSUMER REPORTS NEWSWEEK NAT GEO MARTHA STEWART LIVING U.S. NEWS & WORLD RPT TIME SOUTHERN LIV. MODERN MATURITY PEOPLE WKLY BETTER HOMES AND GRDNS SPORTS ILLUSTRATED PARADE MAG COSMO 100 110 120 130 140 150 160 Expected Frequency of Interest

EXPECTED BUYER BEHAVIOR Try doing this for a product you like and one you know little about.
Describe the expected buyer behavior profile of the market. CONSUMER - use key items like demographics, psychographics, POP behavior, the marketing mix, classification of your product, and other relevant items to generally describe how buyers would purchase this item. B2B – use industry [NAICS], application, quantity, purchasing patterns, the marketing mix, classification of your product, and other relevant items to generally describe how buyers would purchase this item.

BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 4B Brand Management and the Firm Brand Equity Models ALAN L. WHITEBREAD.

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BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 4B Brand Management and the Firm Brand Equity Models ALAN L. WHITEBREAD.

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Presentation on theme: "BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT SECTION 4B Brand Management and the Firm Brand Equity Models ALAN L. WHITEBREAD."— Presentation transcript:

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