9-2 Objectives What is a brand and how does branding work – The Process? What is brand equity? How is brand equity built, measured, and managed? What are the important decisions in developing a branding strategy?
9-3 Basic Concepts: The Brand / Brand Management Process and Brand Equity Brand Definition and Perspectives: A name, term sign, symbol or design intended to identify a seller’s offering with competitive distinction. Conveys a meaning to a particular kind of customer about a company and its products relative to Attributes, Benefits, Values, and Culture - Identity. Branding and Brand Building: A company making a promise (value proposition) or (brand promise) to deliver (brand building) differentiated value to the market through specific products and services with meaningful significance from competition. Endowing products & services with the power of a brand Brand Bonding: Customers experience the value proposition Brand Management Process: ■Identify and establish brand positioning ■Plan and implement a brand marketing plan ■Measure and interpret brand performance ■Grow and sustain brand value
9-4 Brand Equity: Added value endowed to products and services (also equates to premium price) Customer Based Brand Equity: The positive differentiated effect that brand knowledge has on a consumer’s response to a brand Brand Knowledge: All thoughts, feeling, images, experiences that become associated w/ a brand Other Perspectives: ■Brand Awareness (existence – better than nothing) ■Brand Acceptability (credibility – better vs. above) ■Brand Preference (appreciation – better vs. above) ■Brand Loyalty (commitment – best of all) Basic Concepts: The Brand / Brand Management Process and Brand Equity (cont.) MORE DEFINITIONS, PERSPECTIVES & MODELS BRAND ASSET VALUATOR ● Differentiation ● Relevance ● Esteem ● Knowledge AAKAR ● Uses Matrix of Brand Assets and Liabilities ● Couples Core & Extended Identity Concepts BRANDZ ● Presence ● Relevance ● Performance ● Advantage ● Bonding BRAND RESONANCE ● Salience ● Performance ● Imagery ● Judgments ● Feelings ● Resonance BRAND EQUITTY MODELS
9-5 Identify the maker Simplify product handling Organize accounting Offer legal protection Basic Concepts: The Brand / Brand Management Process and Brand Equity (cont.) Signify quality Create barriers to entry Serve as a competitive advantage Secure price premium ROLE OF BRANDS Improved perceptions of product performanceImproved perceptions of product performance Greater loyaltyGreater loyalty Less vulnerable to competitionLess vulnerable to competition Less vulnerable to crisesLess vulnerable to crises Larger marginsLarger margins Inelastic consumer response to price increasesInelastic consumer response to price increases Elastic consumer response to price decreasesElastic consumer response to price decreases Greater trade cooperationGreater trade cooperation Increase in effectiveness of IMCIncrease in effectiveness of IMC Licensing opportunitiesLicensing opportunities Brand extension opportunitiesBrand extension opportunities MARKETING ADVANTAGES OF STRONG BRANDS OF STRONG BRANDS
9-6 Building Brand Equity - Elements Criteria Criteria Memorable Meaningful Likeable Transferable Adaptable Protectable Devices to Identify and Differentiate The Brand Three Drivers of Brand Equity BRAND ELEMENTS Brand Contact: Personalization Integration Internalization Slogans Brand Names URLs Logos Symbols Characters MARKETING ACTIVITIES & PROGRAMS ASSOCIATION TO OTHER ENTITIES WITH MEANING
9-7 Slogans Like a good neighbor, State Farm is there Just do it Nothing runs like a Deere Help is just around the corner Save 15% or more in 15 minutes or less We try harder We’ll pick you up Nextel – Done Zoom Zoom I’m lovin’ it Innovation at work This Bud’s for you Always low prices
9-8 Measuring and Managing Brand Equity Brand Audits Brand Tracking Brand Valuation MEASURING BRAND EQUITY Determine sources & factors that create brand equity: product Quality, service, professionalism Conduct consumer tracking studies focused on determining financial value for each factor that influences brand equity Estimate the total financial value of the brand from customer assignment of value to each factor defined above times the number of units sold BRAND NAME 2004 EQUITY in $BILLS Coca Cola $67.39 Microsoft $61.37 IBM $53.79 GE $44.11 Intel $33.50 MANAGING BRAND EQUITY Brand Reinforcement Brand Revitalization Brand Crises Actions that fulfil value proposition to the market place on a consistent basis * Adjust actions to restore fulfillment of value proposition to the market * Redefine value proposition and manage actions to fulfill expectations created Sudden negative influence on brand value requires sudden, significant, sincere and sustained actions until former level is restored
9-9 Devising a Branding Strategy / Brand Naming New Products and Product Portfolios Develop new brand elements Apply existing brand elements Use a combination of old and new Use a combination of old and new NEW PRODUCT BRAND STRATEGY Individual Names Blanket Family Names Separate Family Names Corporate Name-individual Name Combo Single name for single product - Gen Mills: Bisquick, Gold Medal Flour Single name for all products and families - General Electric Single name for different product familiies - Sears: Kenm,ore, Kraftsman Tools Parent & Sub Brand name for single product - Kellog’s: Rice Crispies, Raisin Bran NEW PRODUCT BRAND DECISIONS ADVANTAGES ■Acceptance ■Premium Price ■Risk Avoidance ■Expense DISADVANTAGES ■Acceptance ■Premium Price ■Risk Avoidance ■Expense BRAND PORTFOLIOS: BRAND LINES GROUPED FOR MARKET SEGMENT OR COMPETITIVE FOCUS FLANKERS LOW-END ENTRY LEVEL CASH COWS HIGH-END PRESTIGE