Strategic Brand Management

Chapter 1

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What is a Brand?
Old Norse word brandr to burn. AMA Name, term, sign, symbol, or design, or a combination of them, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of the competition. Branding basis people, place, animal or bird, scientific term, and things or objects. Branding contain inherent product meaning, and attributes or benefits. Branding could be done for product (physical good, retail store, person, organization, place, or an idea. Brand = product + other differentiating dimensions (physiological and psychological)
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Product Levels?

Core benefits fundamental need or want. Generic product basic offering. Expected product normal expectation from a product in the market. Augmented product differentiating and distinguishing attributes, benefits, or related service. Potential product ideal and in future.

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Branding - benefits?
Consumers Identification of source Assignment of responsibility Risk reducer functional, physical, financial, social, psychological, and time Search cost reducer Promise, bond, or pact Symbolic, cultural Signal of quality
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Manufacturers Means of identification for handling or tracing Legal protection Signal of quality to consumers

Endowing product with unique association Competitive advantage Source of financial return

Branding is Universal (anything can be branded)

Commodity Chicken, Coffee, salt, fruits, vegetables, water, etc. Physical good - Consumer products; Business to Business; High-tech products. Services KPMG, Citi, Airlines, Energy firms, etc. Retailers and distributors Sears, Wal-Mart, private or store brands. On-line product and services google, e-bay, etc. People and Organizations Paul Newman. Sports, Arts, and Entertainment Cowboys?
Geographic Locations Australia, Alaska. Ideas and Causes Red Cross, NRA.
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Determinants of Brand Longevity

Vision of the mass market? Managerial persistence? Financial commitment? Relentless Innovation? Asset leveraging.

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Some Challenges l Savvy consumers, maturing market, decreasing brand loyalty. l Brand proliferation, complex brand families, . l Media fragmentation, eroding traditional media, new options, changes in advertising and promotional expenditures. l Increased competition, difficulty differentiating, private labels. l Increased cost, increasing trade power. l Increased accountability, job turn-over.
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Next?

Brand Equity financial value, intangible value, loyalty,

consumer perception, consistent behavior???

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Why Brand Equity?

l Positive brand equity leads to:
Loyalty Larger Margins Greater Trade Support More Efficient Communications / Marketing Resiliency to Crises Licensing Opportunities Brand Extension Opportunities Reduced Vulnerability to Competition Greater financial returns

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The Value of Brand Equity

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Brand Equity
l Sources of Brand Knowledge
- Associative node model of memory - Brand awareness - Brand image
l Strength of brand associations l Favorability of brand associations l Uniqueness of brand associations

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Corporate Awareness

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Brand Associations
l Stolichnaya
Experienced Self-assured Successful Male Lexus Not-trendy

l Absolut
Young Contemporary Flashy Male Bars Advertising or arts

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Evolution of Brand Elements, GE

l 1876-1960 s electronics l 1900 trademark s logo l 1900 slogan Better Living Electronically l 1960 s General Electric -> GE l 1970 s slogan Progress for People l 1979 slogan We Bring Good Things to Life
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Brand Equity
l But how does one develop brand equity? l The goal of this course is to learn how to manage brands (via marketing programs) in order to create brand equity - that is, create an enduring advantage for your brands.
l Strategic Brand Management Process:
1. Identifying and Establishing brand position and values. 2. Planning and Implementing brand marketing programs. 3. Measuring and interpreting brand performance. 4. Growing and sustaining brand equity.
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Building Customer-Based Brand Equity

TOOLS AND OBJECTIVES Choosing Brand Elements (4) Brand name Logo Memorability Symbol Meaningfulness Character Transferability Packaging Adaptability Slogan Protectability KNOWLEDGE EFFECTS BENEFITS Possible Outcome Brand Awareness (2)
Depth Recall Recognition Purchase Consumption

Greater loyalty Less vulnerability to competitive marketing actions and crises Larger margins More elastic response to price increases

Breadth

Developing Marketing Programs (5 & 6) Product Price Distribution channels Communications Functional & symbolic benefits Value perceptions Integrate Push & Pull Mix and match options

Brand Associations (2&3) Strong Relevance Consistency Desirable Deliverable Point of parity Point of difference

More inelastic response to price increases Increased marketing communication efficiency and effectiveness Possible licensing opportunities More favorable brand extension evaluations

Leverage of Secondary Associations (7) Company Country of origin Channel of distribution Other brands Endorsor Event

Favorable

Awareness Meaningfulness Transferability

Unique

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Building Equity
1. Determine brand knowledge structures
a. Breadth of awareness (brand salience) b. Positioning (points of parity/difference) c. Image (strong & favorable brand associations)

2. Develop marketing programs 3. Integrate across product lines and geographies 4. Measure and control
a. Feelings/judgments/loyalty
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Brand Value: Brand Hierarchy Pyramid

The emotional beliefs and values that consumers feel are being addressed by our brand (CENTRAL) Very meaningful in differentiating our Brand but very difficult to deliver consistently to our consumers

The functional and emotional benefits that our product/services provides to the consumer (EXPRESSIVE) Product/Service features and/or attributes that must be addressed (FUNCTIONAL)
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Beliefs & Core Values

Benefits Features & Attributes

Easy to deliver and explain to consumers but also easy to imitate

Brand Management
l Brand management is the act of designing and implementing marketing programs to build and maintain brand equity.
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Product Price Distribution Communications

The Role of a Brand or Product Manager

l Prepare Marketing Plan l Develop Copy, Programs, and Campaigns l Stimulate Sales and Distribution l Market Intelligence l Product Improvements

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The Role of a Brand or Product Manager

l Pluses
- Cost effective mix, quick market reaction,

attention for small brands, good training for executives

l Minuses
- Conflict and frustration (responsibility and no

authority), administrative work with executive expectations, learns products not functions, short horizon, costs of associates and assistants
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A Product Manager Computer Software Firm

l Typical day
- Meetings - new product line, marketing mix, marketing staff, organizational design and integration - E-mail/Phone - 3rd party developers, sales force, product support

l Marketing planning - drafting the marketing plan

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A Product Manager Computer Software Firm

l Marketing mix - recommends price to corporate committee, manages advertising, conducts focus groups for product positioning and development, decides on channels

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A Product Manager Consumer Packaged Goods Firm

l Typical day
- 75% fighting fires, 25% planning

l Marketing planning - key is volume forecasting since unsold inventory is perishable l Mix - 1/3 on pricing issues (list & trade), 20% on consumer promotions, president handles ads, 15% on distribution, little on sales and service
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A Product Manager Packaged Goods Firm

l Marketing mix - recommends price to corporate committee, manages advertising, conducts focus groups for product positioning and development, decides on channels.

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Brand Management Issues

Purchasing Promotion Services R&D Manufacturing Legal
Market Research
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Media Packaging Salesforce

Product Manager

Distribution Fiscal Publicity

Advertising Agency

The Nature of the Job

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Project

Staring Point: Brand perception about: Brand features and attributes - awareness? Brand benefits needs & expectations? Brand values - associations?

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PRODUCT LEVEL
LEVEL BRAND Name/Positioning Potential Product Augmented Product Expected Product Generic Product Core Benefit
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