Branding

DONE BY
DANA KAKEESH

Index
introduction……………………………………….(3)
value of branding………………………………….(3)
brand naming……………………………………..(8)
brand equity……………………………………..(13)
branding name policies………………..…………(11)
types of brand…………………….……………..(16)
conceptual model of brand
evolution………………………………………….(17)
co-branding………………………………………(18)
brand licensing…………………………………...(19)
protecting brand………………………………...(20)
characteristic of world class brand……………(21)
conditions to successful branding:………………(21)
glossary………………………………………… (27)
references..………………………...…………… (29)

BRANDING

“…it is not factories that make profits, but relationships with customers, and
it is company and brand names which secure those relationships”

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INTRODUCTION
Marketers must make many decisions about products, including choices about
brands, brand names, brand marks, trademarks, and
Trade names. A brand is a name, term, design, symbol, or any other feature that iden-
tifies one seller's good or service as distinct from those of other sellers. A brand may
identify one item, a family of items, or all items of that seller. A brand name is the part
of a brand that can be spoken—including letters, words, and numbers—such as 7Up.
A brand name is often a product's only distinguishing characteristic. Without the
brand name, a firm could not differentiate its products. To consumers, a brand name
is as fundamental as the product itself. Indeed, many brand names have become syn-
onymous with the product, such as Scotch Tape and Xerox copiers. Through
promotional activities, the owners of these brand names try to protect them from being
used generic names for tape and photocopiers.
The element of a brand that is not made up of words—often a symbol or design— is a
brand mark. One example is the Golden Arches, which identify McDonald's
Restaurants and can be seen on patches worn by athletic teams—from U.S. Olympic
Teams to Little League softball teams—sponsored by McDonald's. A trademark is a
legal designation indicating that the owner has exclusive use of a brand or a part of a
brand and others are prohibited by law from using it. To protect a brand name or brand
mark in the United States, an organization must register it as a trademark with the
U.S. Patent and Trademark Office. In 2000, the Patent and Trademark Office registered
127,794 trademarks. A trade name is the full and legal name of an organization, such
as Ford Motor Company, rather than the name of a specific product. Finally,
Copyright Is the exclusive legal rights to reproduce, publish, and sell the matter and
form of a literary, musical, or artistic work.

Value of Branding
Both buyers and sellers benefit from branding Brands help buyers identify specific
products that they do and do not like, which in turn facilitates the purchase of items
that satisfy their needs and reduces the time required to purchase the product. Without
brands, product selection would be quite random because buyers could have no
assurance they were purchasing what they preferred. The purchase of certain brands
can be a form of self-expression. For example, clothing brand names are important to
many teenage boys. Names such as Tommy Hilfiger, Polo, Champion Guess, and Nike
give manufacturers an advantage in the marketplace. A brand also helps buyers
evaluate the quality of products, especially when they are unable t 1 judge a
product's characteristics. That is. A brand may symbolize a certain quality level to
a customer, and in turn the person lets that perception of quality represent the
quality of the item. A brand helps reduce a buyer's perceived risk of purchase In
addition; a psychological reward may come from owning a brand that symbolizes
status. The Mercedes-Benz brand in the United States is an example.
Sellers benefit from branding because each company's brands identify its products,
which makes repeat purchasing easier for customers. Branding helps a firm introduce a
new product that carries the name of one or more of its existing products. Because
buyers are already familiar with the firm's existing brands. Branding also facilitates
promotional efforts because the promotion of each branded product indirectly

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promotes all other similarly branded products. Coca-Cola's brand extensions--
additional products marketed under the Coca-Cola brand—improved its market share
from 36 percent in the early 1980s to 42 percent in the 1990s. Branding also fosters
brand loyalty To the extent that buyers become loyal to a specific brand, the
company's market share for that product achieves a certain level of stability, allowing
the firm to use its resources more efficiently; Once a firm develops some degree o f cus-
tomer loyalty for a brand, it can maintain a fairly consistent price rather than continually
cutting the price to attract customers. A brand is just as much of an asset as the
company's building or machinery. When marketers increase their brand's value, they
also raise the total asset value of the organization. (We discuss brand value in more
detail later in this chapter.) At times marketers must decide whether to change a brand
name. This is a difficult decision because the value in the existing brand name must
be given up to gain the potential to build a higher value in a new, brand name.

Why should businesses try to build their brands?

There are many advantages to businesses that build successful brands. These include:

• Higher price
• Higher s profit margins
• Better distribution
• Customer loyalty

Businesses that operate successful brands are also much more likely to enjoy higher
profits.

A brand is created by augmenting a core product with distinctive values that

distinguish it from the competition. This is the process of creating brand value.

All products have a series of “core benefits” – benefits that are delivered to all
consumers. For example:

• Watches tell the time

• CD-players play CD’s
• Toothpaste helps prevent tooth decay
• Garages dispense petrol.

Consumers are rarely prepared to pay a premium for products or services that simply
deliver core benefits – they are the expected elements of that justify a core price.

Successful brands are those that deliver added value in addition to the core benefits.

These added values enable the brand to differentiate itself from the competition.
When done well, the customer recognizes the added value in an augmented product
and chooses that brand in preference.

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For example, a consumer may be looking for reassurance or a guarantee of quality in
a situation where he or she is unsure about what to buy. A brand like Mercedes, Sony
or Microsoft can offer this reassurance or guarantee.

Alternatively, the consumer may be looking for the brand to add meaning to his or her
life in terms of lifestyle or personal image. Brands such as Nike, Porsche or
Timberland do this.

A brand can usefully be represented in the classic “fried-egg” format shown below,
where the brand is shown to have core features that are surrounded (or “augmented”)
by less tangible features.

Businesses that invest in and sustain leading brands prosper whereas those that fail are
left to fight for the lower profits available in commodity markets.

What factors are important in building brand value?

Professor David Jobber identifies seven main factors in building successful brands, as
illustrated in the diagram below:

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Quality

Quality is a vital ingredient of a good brand. Remember the “core benefits” – the
things consumers expect. These must be delivered well, consistently. The branded
washing machine that leaks, or the training shoe that often falls apart when wet will
never develop brand equity.

Research confirms that, statistically, higher quality brands achieve a higher market
share and higher profitability that their inferior competitors.

Positioning

Positioning is about the position a brand occupies in a market in the minds of

consumers. Strong brands have a clear, often unique position in the target market.

Positioning can be achieved through several means, including brand name, image,
service standards, product guarantees, packaging and the way in which it is delivered.
In fact, successful positioning usually requires a combination of these things.
Positioning can be defined as follows:

Positioning is how a product appears in relation to other products in the market

Brands can be positioned against competing brands on a perceptual map.

A perceptual map defines the market in terms of the way buyers perceive key
characteristics of competing products.

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The basic perceptual map that buyers use maps products in terms of their price and
quality, as illustrated below:

Repositioning

Repositioning occurs when a brand tries to change its market position to reflect a
change in consumer’s tastes. This is often required when a brand has become tired,
perhaps because its original market has matured or has gone into decline.

The repositioning of the Lucozade brand from a sweet drink for children to a leading
sports drink is one example. Another would be the changing styles of entertainers
with above-average longevity such as Kylie Minogue and Cliff Richard.

Communications

Communications also play a key role in building a successful brand. We suggested

that brand positioning is essentially about customer perceptions – with the objective to
build a clearly defined position in the minds of the target audience.

All elements of the promotional mix need to be used to develop and sustain customer
perceptions. Initially, the challenge is to build awareness, then to develop the brand
personality and reinforce the perception.

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First-mover advantage

Business strategists often talk about first-mover advantage. In terms of brand

development, by “first-mover” they mean that it is possible for the first successful
brand in a market to create a clear positioning in the minds of target customers before
the competition enters the market. There is plenty of evidence to support this.

Think of some leading consumer product brands like Gillette, Coca Cola and
Sellotape that, in many ways, defined the markets they operate in and continue to
lead. However, being first into a market does not necessarily guarantee long-term
success. Competitors – drawn to the high growth and profit potential demonstrated by
the “market-mover” – will enter the market and copy the best elements of the leader’s
brand (a good example is the way that Body Shop developed the “ethical” personal
care market but were soon facing stiff competition from the major high street
cosmetics retailers.

Long-term perspective

This leads onto another important factor in brand-building: the need to invest in the
brand over the long-term. Building customer awareness, communicating the brand’s
message and creating customer loyalty takes time. This means that management must
“invest” in a brand, perhaps at the expense of short-term profitability.

Internal marketing

Finally, management should ensure that the brand is marketed “internally” as well as
externally. By this we mean that the whole business should understand the brand
values and positioning. This is particularly important in service businesses where a
critical part of the brand value is the type and quality of service that a customer
receives.

Think of the brands that you value in the restaurant, hotel and retail sectors. It is likely
that your favorite brands invest heavily in staff training so that the face-to-face
contact that you have with the brand helps secure your loyalty.

Brand Naming:
A brand is a company’s unique designation, or trademark, which distinguishes its
offering from other product category entries. Many marketing executive regard brand
naming to be one of the most important aspects of marketing management. Product
and brand managers consider it critical to choose an appropriate brand name, largely
because that choice can influence early trial of a brand and affect sales volume. The
brand name identifies a company’s offering and differentiates it from others on the
market. The brand name and package graphics work together to communicate and
position the brands image. In short, a brands name is crucially important-indeed, a
name is “the cerebral switch that activates an image in the mind of the audience. A
good brand name can evoke a feeling of trust, confidence, security, strength,

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durability, speed, status, and many other desirable associations. The name chosen for
a brand (1) affects the speed with which consumers become aware of the brand, (2)
influence the brands image, and (3) thus plays a major role in brand equity formation.
Achieving consumer awareness of a brand name is the critical initial aspect of brand
equity enhancement. Brand name awareness has been characterized as the “gateway
“to consumer more complicated learning and retention of association that constitute a
brands image.

Brand names can be created internally by the organization. Sometimes a name is

suggested by individuals who are close to the development of the product. Some
organizations have committees that participate in brand name creation and approval.
Large companies that introduce numerous new products annually are likely to have
department that develops brand names. Most of the important branding considerations
apply to both goods and a service, branding a service has some additional dimensions.
The service brand is usually the same as the company name. Because the service
brand name and company name are so closely interrelated, a service brand name must
be flexible enough to encompass a variety of current services, as well as new ones the
company might offer in the future. Frequently a service marketer will employ a
symbol along with its brand name to make the brand distinctive and to communicate a
certain image.

What Constitutes a Good Brand Name?

Researchers have attempted to specify the factors that determine brand name quality.
Although the accumulated knowledge is nowhere close to the point of specifying
scientific principles, there is general agreement that brand names should satisfy
several fundamental requirements:

Easy to spell and read.

Short and simple.

Can be pronounced in only one way.

A brand should be designed so that it can be use and recognized in all types of media.

Can be pronounced in only one way.

Distinguish the brand from competitive offerings.

Its is desirable for a brand to have a unique identity, something that Cleary
differentiates it from competitive brands. Failure to distinguish a brand from
competitive offerings creates consumer confusion and increases the chances that
consumers will not remember the name or mistakenly select another brand. Some
marketers attempt to hitchhike on the success of other brands by using names that are
similar to better-known and more respected brands.

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Describes the brand and its Attributes or Benefits.

It is important to note this regard that a brand name need not state a specific benefit
but may rather simply suggest an abstract promise.

Researchers have carefully examined the issue of brand name suggestiveness.

Suggestive brand names are those that imply particular attributes or benefits in the
context of a product category. Suggestive brand names facilitate consumer recall of
advertised benefit claims that are consistent in meaning with the brand names and
reinforce in consumer’s memories the association between the name and semantically
related benefit information about the brand. On other hand, these same suggestive
names may reduce the recall ability of benefit claims after a brand has been
repositioned to stand for something different than its original meaning.

Brand names sometimes are created rather than selected from words found in a
dictionary. Compaq (a computer brand) is a created name, as are many automobile
brand names currently in use in the past.

Achieve Compatibility with a Brands Desire Image and with its product Design or
Packaging.

Because marketplaces are dynamic and consumer preferences and desires change over
time, some brand names lose their effectiveness and have to be changed to avoid
negative images. A case in point is Kentucky Fried Chicken. This name was
compatible with the product for well over two decades, but a name change was
needed when health consciousness swept the nation. A change from Kentucky Fried
Chicken to simply KFC was undertaken with hopes of preventing the negative
implication associated with the word fried.

Be Memorable and Easy to Pronounce.

A good brand name is one that easy to remember and pronounce. One-word names
(e.g, Tide), through shortness is not an essential ingredient for a good name. Probably
few worlds are as memorable as those learned in early childhood, and among the first
world learned are animals as brand names; for example, automobile companies are
using or have used names such as Mustang, thunderbird, jaguar.

Can be pronounced in all languages (for international markets).

Companies that compete in international market face a special problem in selecting

brand names. A name that conveys a positive image in one language may be
meaningless in another. Or worse, it may have unintended meanings. GMs Nova car
is a classic example. GM stuck with the Nova name when it introduced the car in
South America. It seemed like a sensible decision because nova is the Spanish word

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for star. However, Nova also sounds the same as the Spanish words for “no go”.
Consumer weren’t interested in a no-go car, and sales didn’t pick up until GM
changed the name.

Branding name policies

How should brand names be chosen? Is the name important?

Marketing theory suggests that there are 5 main types of brand name:

(1) Family brand names:

A family brand name is used for all products. By building customer trust and loyalty
to the family brand name, all products that use the brand can benefit.

Good examples include brands in the food industry, including Kellogg’s, Heinz and
Del Monte. Of course, the use of a family brand can also create problems if one of the
products gets bad publicity or is a failure in a market. This can damage the reputation
of a whole range of brands.

(2) Individual brand names:

An individual brand name does not identify a brand with a particular company.

For example, take the case of Heinz. Heinz is a leading global food manufacturer with
a very strong family brand. However, it also operates many well-known individual
brand names. Examples include Farleys (baby food), Linda MacCartney Foods
(vegetarian meals) and Weight Watcher’s Foods (diet/slimming meals and
supplements).

Why does Heinz use individual brand names when it has such a strong family brand
name? There are several reasons why a brand needs a separate identity – unrelated to
the family brand name:

• The product may be competing in a new market segment where failure could harm
the main family brand name

• The family brand name may be positioned inappropriately for the target market
segment. For example the family brand name might be positioned as an up market
brand for affluent consumers.

• The brand may have been acquired; in other words it has already established itself as
a leading brand in the market segment. The fact that it has been acquired by a
company with a strong family brand name does not mean that the acquired brand has
to be changed.

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(3) Combination brand names:

A combination brand name brings together a family brand name and an individual
brand name. The idea here is to provide some association for the product with a strong
family brand name but maintaining some distinctiveness so that customers know what
they are getting.

Examples of combination brand names include Microsoft XP and Microsoft Office in

personal computing software and Heinz Tomato Ketchup and Heinz Pet Foods.

(4)Brand extension and brand stretching

Marketers have long recognized that strong brand names that deliver higher sales and
profits (i.e. those that have brand equity) have the potential to work their magic on
other products.

The two options for doing this are usually called “brand extension” and “brand
stretching”.

A) Brand extension

Brand extension refers to the use of a successful brand name to launch a new or
modified product in a same broad market.

A successful brand helps a company enter new product categories more easily.

For example, Fairy (owned by Unilever) was extended from a washing up liquid
brand to become a washing powder brand too.

The Lucozade brand has undergone a very successful brand extension from children’s
health drink to an energy drink and sports drink.

B) Brand stretching

Brand stretching refers to the use of an established brand name for products in
unrelated markets.

For example the move by Yamaha (originally a Japanese manufacturer of motorbikes)

into branded hi-fi equipment, pianos and sports equipment.

When done successfully, brand extension can have several advantages:

• Distributors may perceive there is less risk with a new product if it carries a familiar
brand name. If a new food product carries the Heinz brand, it is likely that customers
will buy it

• Customers will associate the quality of the established brand name with the new
product. They will be more likely to trust the new product.

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• The new product will attract quicker customer awareness and willingness to trial or
sample the product

• Promotional launch costs (particularly advertising) are likely to be substantially

lower.

(5)Multibrand Decision

In a multibrand strategy, the seller develops two or more brands in the same product
category. This marketing practice was pioneered by Procter & Gamble when it
introduced Cheer as a competitor for its already successful Tide. Although Tide's
sales dropped slightly, the combined sales of Cheer and Tide were higher. Procter &
Gamble now produces ten detergent brands.
Manufacturers use multibrand strategies for several reasons. First, they can gain
more shelf space, thus increasing the retailer's dependence on their brands.
Second, few consumers are so loyal to a brand that they will not try another. The
only way to capture the "brand switchers" is to offer several brands. Third,
creating new brands Develops healthy competition within the manufacturer's
organization. Managers of different General Motors brands compete to outperform
each other. Finally, a multibrand strategy positions brands on different benefits and
appeals, and each brand can attract a separate following.
Companies using a multibrand strategy run the risk of spreading their resources
over many marginally profitable brands instead of building a few highly profitable
ones these companies should weed out their weaker brands and carefully screen new
ones'! Ideally, a company's new brands should take business from competitors'
brands; not cannibalize the company's current brands. Or at least the combined
profits from the old and new brands should be larger, even if some cannibalization
occurs.

The Concept of Brand Equity:

Appreciating the concept of brand equity requires that we have a clear understanding
of the term brand which has been stated before to represent a" 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 competitors",
but a brand is much more than that, it is a set of values that its marketers, senior
officials, and other employees consistently embrace and communicate for an extended
period. For example, Volvo stands for safety, Harley-Davidson represents freedom,
Rolex embodies sophistication. All of these brands posses high equity because
consumers believe these brands have the ability and willingness to deliver on their
brand promises.
Brand equity can be considered from both the firm's perspective and from the
consumer's. The firm-based view point of brand equity focuses on achieving a higher
market share, increasing brand loyalty, and being able to charge premium prices.

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Brand equity from the consumer's perspective consists of two forms of brand
knowledge: brand awareness and brand image. Therefore brand equity is the marketing
and financial value associated with brand's strength in the market.

Major Elements of Brand Equity:

Brand Awareness: Is the basic dimension of brand equity, a brand has no equity unless
the consumer is aware of the brand. Brand awareness is an issue of whether a brand
name comes to mind when consumers think about a particular product category and the
ease with which the name is evoked, for example consider all the brands of athletic
footwear that come immediately to the mind, probably Nike, Adidas, and Puma would
come to mind, that because these brands possess high levels of awareness and thus have
high equity.
There are two levels of awareness: brand recognition and brand recall.
Brand recognition reflects a relatively superficial level of awareness, consumers may be
able to identify a brand if it is presented to them on a list or hints are provided, whereas
brand recall reflects a deeper form of awareness, which is being able to retrieve a brand
name from memory without reminders.
The marketing communication imperative is thus to move brands from a state of
unawareness, to recognition, on to recall, and ultimately to top-of-mind awareness, this
level of awareness (top-of-mind) exists when the company's brand is the first brand that
consumers recall when thinking of a particular product category.

Brand Image: Can be thought of the types of associations that come to the customer's
mind when contemplating a particular brand. An association is simply the particular
thoughts and feelings that a consumer has about a brand, these associations can be
conceptualized in terms of type, favorability, strength, and uniqueness. For example
consider a consumer named Adam and the McDonald's fast-food chain, now that Adam
is 27 years old college graduate in New York has been eating at McDonald's since he
was only 2 years old. He vividly remembers going to McDonald's in his home town
with his family. Ronald McDonald and the smell of burgers and fries are some of the
thoughts that immediately enter his mind. He can't forget all the good times spent with
his friends there. All of these thoughts and feelings represent types of associations in
Adam's mind about McDonald's. All of these associations represent favorable links
with McDonald's. These associations are held strongly in Adam's memory. Some of the
associations are unique in comparison to other fast-food chains.
We can see from this illustration that Adam associates McDonald's with various
attributes (Ronald McDonald), benefits (great tasting fries), and that he possesses an
overall favorable evaluation, or attitude toward this brand.
Many brands have relatively little equity. This is because consumers are 1) only faintly
aware of these brands or worse yet, are completely unaware of them, or 2) even if
aware do not hold strong, favorable, and unique associations about these brands.
Brands even have their own personalities; there are five dimensions that seem to
capture the personalities of a variety of consumer brands. These dimensions and
associated characteristics are as follows:
Sincerity – This dimension includes brands that are down-to-earth, honest, cheerful
and wholesome.( such as General Motors).
Excitement – Brands with an exciting personality are perceived as daring, spirited
imaginative, and up-to-date.( such as Hummer).

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Competence –Brands scoring high on this personality dimension are considered
reliable, intelligent and successful. (such as Toyota).
Sophistication –Brands that are considered upper class and charming.(such as Rolex).
Ruggedness –Brands that are tough and outdoorsy. (such as Timberland).

Brand Loyalty: is a customer's favorable attitude toward a specific brand. If a brand

loyalty is strong enough, customers may consistently purchase this brand when they
need a product in that product category. Although brand loyalty may not result in a
customer's purchasing a particular brand all the time, the brand is at least viewed as a
potentially viable choice in the set of brands being considered for purchase.
Development of brand loyalty in a customer reduces his or her risks and shortens the
time spent buying the product. Brand loyalty varies by country; customers in France,
Germany and the United Kingdom tend to be less brand loyal than U.S. customers.
There are three degrees of brand loyalty:
1. Brand Recognition- occurs when a customer is aware that the brand exists and views
it as an alternative purchase if the preferred brand is unavailable. Even if consumers
can't recall the brand without help, they may be reminded when they see it in a store
among other less familiar brands.
2. Brand Preference- is a strong degree of brand loyalty. A customer definitely prefers
one brand over competitive offerings and will purchase this brand if available perhaps
because of habit or favorable past experience. However, if the brand is not available,
the customer will accept a substitute brand rather than spending additional effort
finding and purchasing the preferred brand.
3. Brand Insistence- occurs when a customer strongly prefers a specific brand, will
accept no substitute, and is willing to spend a great deal of time and effort to acquire
that brand.
Brand insistence is the strongest degree of brand loyalty. However, it is the least
common type of brand loyalty. The creation of brand loyalty significantly contributes to
an organization's ability to achieve a sustainable competitive advantage.

Enhancing Brand Equity:

Enhance brand's equity are accomplished through the initial choice of positive brand
identity (that is, the selection of a good brand name or logo) but mostly through
marketing and Marketing communication programs that forge favorable, strong, and
unique associations in the consumer's mind about a brand.
Products that are high in quality and represent a good value, potentially possess high
brand equity, but effective and consistent marketing communication efforts are needed
to build and maintain brand equity.
When firms communicate unique and positive message via advertising, personal
selling, promotions, events, and other means, they are able to differentiate their brands
effectively from competitive offerings and insulate themselves from future price
competition.
Marketing communications plays an essential role in creating positive brand equity and
building strong brand loyalty. However, this is not always accomplished with
traditional advertising or other conventional forms of marketing communications.

Types of brands
There are two main types of brand – manufacturer brands and own-label brands.

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(1) Manufacturer brands

Manufacturer brands are created by producers and bear their chosen brand name. The
producer is responsible for marketing the brand. The brand is owned by the producer.
By building their brand names, manufacturers can gain widespread distribution (for
example by retailers who want to sell the brand) and build customer loyalty (think
about the manufacturer brands that you feel “loyal” to). These are sometimes called
national brands because the brand is promoted all across the country or in large
regions. Note, however, that many manufacturer brands are now distributed globally.
Such brands include Nabisco, Campbell's, Whirlpool, Ford, and IBM. Many creators
of service-oriented firms—like McDonald's, Orkin Pest Control, and Bank of
America—promote their brands this way too.

(2) Private Distributors

Distributors brands are created and owned by businesses that operate in the
distribution channel – referred also to “Own-label, private brands, store brands,
middleman or dealer brands”.

Often these distributors are retailers, but not exclusively. Sometimes the retailer’s
entire product range will be own-label. However, more often, the distributor will mix
own-label and manufacturers brands. The major supermarkets (e.g. Tesco, Asda, and
Sainsbury’s) are excellent examples of this.

Own-label branding – if well carried out – can often offer the consumer excellent
value for money and provide the distributor with additional bargaining power when it
comes to negotiating prices and terms with manufacturer brands.

From the middleman's perspective, the major advantage of selling a popular man-
ufacturer brand is that the product is already resold to some target customers. The
major disadvantage is that manufacturers normally offer lower gross margins than the
middleman might be able to earn with a dealer brand. In addition, the manufacturer
maintains control of the brand and may withdraw it from a middleman at any time.
Customers, loyal to the brand rather than to the retailer or wholesaler, may go
elsewhere if the brand is not available.

Who's winning the battle of the brands?

The battle of the brands, the competition between dealer brands and manufacturer
brands, is just a question of whose brands will be more popular and who will be in
control.

At one time, manufacturer brands were much more popular than dealer brands. Now
sales of both kinds of brands are about equal—but sales of dealer brands are expected
to continue growing. Middlemen have some advantages in this battle. With the
number of large retail chains growing, they are better able to arrange reliable sources
of supply at low cost. They can also give the dealer brand special shelf position or
promotion.

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Consumers benefit from the battle. Competition has already narrowed price differ-
ences between manufacturer brands and well-known dealer brands. And big retailers
like Wal-Mart are constantly pushing manufacturers to lower prices—because
national brands at low prices bring in even more customers than store brands.

(3)Generic brand

Generic brands indicate only the product category and not include the company name
or other identifying terms.Generic brands are usually sold at lower prices than
comparable branded item. Today the account for this brands are less than 0.5% of
retail grocery sales.

Conceptual model of brand evolution

Stage 1: Unbranded Goods
In the first stage, goods are treated as commodities and most are unbranded. This
stage is usually characterized by an excess of demand over supply. It is most closely
approximated by developing economies and the former soviet block countries, and is
rarely seen in developed economies. Producers make little effort to distinguish/brand
their goods with the result that the consumer’s perception of goods is utilitarian.

Stage 2: Brand as Reference

In the second stage, competitive pressures stimulate producers to differentiate their
goods from the output of other manufacturers. Differentiation is achieved primarily
through changes in physical product attributes (gets clothes cleaner). Consumers’
memory networks expand beyond recognition of the basic product category to include
other product information in order to evaluate goods on the bases of consistency and
quality.

Stage 3: Brand as Personality

By this stage, differentiation among brands on rational/functional attributes becomes
exceedingly difficult as many producers make the same claim. Therefore, marketers
begin to give their brands personalities. An example is Ivory soap. By creating the
personality of the caring mother, the marketer injects emotion into the consumer’s
learning and valuing process.

Stage 4: Brand as Icon

In this stage, the brand is "owned by consumers". They have extensive knowledge
about the brand – frequently world-wide-- and use it to create their self identity. An
example is the Marlboro cowboy who is recognized around the world. The cowboy is
rugged, a man against the odds, but he is not crude and lacking in sophistication.
Consumers who want to be perceived as strong, rugged or loners might smoke
Marlboro cigarettes. The cowboy is a symbol or icon of a set of values

Stage 5: Brand as Company

This stage marks the change to postmodern marketing. Here, the brand has a complex

17
identity and there are many points of contact between the consumer and the brand.
Because the brand equals the company, all stakeholders must perceive the brand
(company) in the same fashion. The company can no longer present one image to the
media and another to stockholders or consumers. Communications from the firm must
be integrated throughout all of their operations. Communication is not, however,
unidirectional. It flows from the consumer to the firm as well as from the firm to the
consumer so that a dialog is established between the two.

Stage 6: Brand as Policy

few companies to date have entered this stage which is distinguished by an alignment
of company with ethical, social and political causes. Prime examples of this stage are
The Body Shop and Benetton. Consumers commit to the firms that support the causes
favored by the company by purchasing from the firm. Through their commitment,
consumers are said to own the brand.

Before leaping into this stage, firms have to consider both the risks and their
credibility as brand as company. The primary risk is alienating consumers who do not
like the firm’s stance. An example is Benetton with some of its more extreme
advertising. The firm in question also has to decide whether its previous history would
support their credibility as "spokes-companies" on various issues. Consumers might
find it difficult to believe that Exxon is strongly pro-environment.

Co-Branding
Products typically carry a single brand. However, there have been a number of
occurrences where two brands enter into an alliance that potentially serves to enhance
both brands' equity and profitability. This is known as co-branding.

Brands that enter into alliance do so on the grounds that their images are similar, that
they appeal to the same market segment and that the co-branding initiative is mutually
beneficial. The most important requirement for successful co-branding is that the
brands possess a common fit and that the combined marketing communication efforts
maximize the advantages of the individual brands while minimizing the
disadvantages.

Effective co-branding capitalizes on the trust and confidence customers have in the
brands involved. The brands should not lose their identities, and it should be clear to
customers which brand is the main one. It is important for marketers to understand
that when a co-branded product is unsuccessful, both brands are implicated in the
product failure. To gain customer acceptance, the brands involved must represent a
complementary fit in the minds of buyers. For example, trying to link Harley-
Davidson with a brand like Fitness healthy cereals will not achieve co-branding
objectives because; customers are not likely to perceive these brands as compatible.

Some examples of co-branding are as follows:

- Gillette M3 Power shaving equipment with battery brand Duracell.

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- Motorola with D&G to present the latest mobile technology with a complete fashion
accessory.

- Kellogg's and Disney, where Kellogg's demonstrate on its cereal packages Disney
characters.

Forms of Co-Branding:

There are many different sub sections of co-branding. Companies can work with other
companies to combine resources and leverage individual core competencies, or they
can use current resources within one company to promote multiple products at once.
The forms of co-branding include:

Ingredient co-branding- this involves creating brand equity for materials, components
or parts that are contained within other products.

Examples:

Betty Crocker's brownie mix includes Hershey's chocolate syrup.

Intel Processors with Dell computers.

Same-company co-branding- This is when a company with more than one product
promotes their own brands together simultaneously.

Examples:

General Mills promotes Trix cereal and Yoplait yogurt.

Joint venture co-branding- is another form of co-branding defined as two or more

companies are going for a strategic alliance to present a product to the target
audience.

Examples:

British Airways and Citibank formed a partnership offering a credit card where the
card owner will automatically become a member of the British Airway’s Executive
club.

Multiple sponsor co-branding- This form of co-branding involves two or more

companies working together to form a strategic alliance in technology, promotions,
sales, etc.

Examples:

Citibank/American Airlines/Visa credit card partnership.

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Brand Licensing
A popular branding strategy involves. Brand licensing is the process of creating and
managing contract between the owner of a brand and a company or individual who
wants to use the brand in association with a product.

The licensee is responsible for all manufacturing, selling, and advertising functions
and bears the cost if the licensed product fails. Not long ago, only a few firms licensed
their corporate trademarks, but today licensing is a multi-billion-dollar business.

The advantages of licensing range from extra revenues and low-cost or free
publicity to new images and trademark protection. The major disadvantages are a lack
of manufacturing control, which could hurt the company’s names, and bombarding
consumer with too many unrelated products bearing the same name.

Licensing arrangement con also fail because of poor timing, inappropriate distribution
channels, or mismatching of product and name.

Protecting a Brand
A marketer should also design a brand so that it can be protected easily through
registration. A series of court decisions has created a broad hierarchy of
protection based on brand type. From most protectable to least protectable, these
brand types are fanciful (Exxon), arbitrary (Dr Pepper). Suggestive (Spray n
Wash), descriptive (Minute Rice), and generic (aluminum foil). Generic brands
are not protectable. Surnames and descriptive, geographic. Or functional names
are difficult to protect. However, research shows that overall. Consumers prefer
descriptive and suggestive brand names and find them easier to recall compared
with fanciful and arbitrary brand names. Because of their designs, some brands
can legally infringe on more easily than others. Although registration protects
trademarks domestically for ten years and trademarks can be renewed
indefinitely, a firm should develop a system for ensuring that its trademarks are
.renewed as needed
To protect its exclusive rights to a brand, a company must make certain the
brand is not likely to be considered an infringement on any brand already
registered. This task may be complex because infringement is determined by the
courts, which base their decisions on whether a brand causes consumers to be
confused, mistaken. Or deceived about the source of the product. McDonalds is
one company that aggressively protects its trademarks against infringement; it
has brought charges against a number of companies with “Mc” names because it
fears the use of that prefix will give consumers the impression that these
.companies are associated with or owned by McDonalds
The firm that tries to protect a brand in a foreign country frequently encounters
problems. In many countries, brand registration is not possible; the first firm to
use a brand in such a country automatically has the right to it. In some instances,

20
companies actually have had to buy their own brand right from a firm in a
.foreign country because the foreign firm was the first user in that country
Counterfeit products are often hard to distinguish from the real brands. Products
most likely to be counterfeited are well-known brands that appeal to a mass
market and products for which the physical materials are inexpensive compared
with the products prices. Brand fraud not only results in lost revenue for the
brands owner, it also means a low-quality product for customer, distorts
competition, affects investment levels, reduces tax revenues and legitimate
employment, creates safety risks, affect international relations. It also likely
affects customers’ perception of brand due to the counterfeit products inferior
.quality
Finally a brand can be a real asset to a company. Each firm should try to see that
its brand doesn’t become a common descriptive term for its kind of product.
When this happens, the brand name or trademark becomes public property and
.the owner loses all rights to it. This happened with the name aspirin, wheat

Characteristics of World –Class Brands

1. The brand excels at delivering the benefits customers truly desire.

2. The brand stays relevant. “Relevant” brands stay in touch with consumer
changing tastes, desire for change and excitement, and need for product
improvement.

3. The pricing system is based on consumers’ perceptions of value.

4. The brand is properly positioned.

5. The brand is consistent. A consistent brand is one that is not continuously

Changing its positioning and always reinventing itself.

6. The brand portfolio and hierarchy sense.

7. The brand makes use of and coordinates a full repertoire of marketing

activities to build equity.

8. The brands managers understand what the brand means to consumers.

9. “If it’s clear what customers like and don’t like about a brand and what core
associations are linked to the brand, then it should also be clear whether any
given action will dovetail nicely with the brand or create friction”. In other
words, knowing the customer is essential to knowing your brand and
determining what MarCom efforts are needed to best position the brand.
The brand is given proper support, and that support is sustained over the
long run. In a word, world-class brands maintain their momentum (Recall
the prior discussion the prior discussion of momentum in context of the various
implementation decisions).
The company monitors sources of brand equity.

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The following conditions favorable to successful branding:
1. The product is east to label and identify by brand or trademark.

2. The product quality is easy to maintain and the best value for the price.

3. Dependable and widespread availability is possible. When customers

start using a brand, they want to be able to continue using it.

4. Demand is strong enough that the market price can be high enough to
make the branding effort profitable.

5. There are economies of scale. If the branding is really successful, costs

should drop and profits should increase.

6. Favorable shelf locations or display space in stores will help. This is

something

7. retailers can control when they brand their own products.

In general, these conditions are less common in less- developed economies,

and that may explain why efforts to build brands in less-developed nations
often fail.

GLOBAL BRANDS

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 Change
in
Value
2007 From
2007 2006 Change Brand 2006 Prev.
Brand Brand in Value Brand Year
Rank Rank Rank Brand Name $m Value (in %) Parent Company Country

1  1 0 Coca-Cola 65,324 67,000 -3 Coca-Cola   U.S.

2  2 0 Microsoft 58,709 56,926 3 Microsoft  U.S.
3  3 0 IBM 57,091 56,201 2 IBM  U.S.
4  4 0 GE 51,569 48,907 5 GE  U.S.
5  6 1 Nokia 33,696 30,131 12 Nokia  FINLAND
6  7 1 Toyota 32,070 27,941 15 Toyota  JAPAN
7  5 -2 Intel 30,954 32,319 -4 Intel  U.S.
8  9 1 McDonald's 29,398 27,501 7 McDonald's  U.S.
9  8 -1 Disney 29,210 27,848 5 Walt Disney  U.S.
10  10 0 Mercedes-Benz 23,568 21,795 8 DaimlerChrylser  GERMANY
11  11 0 Citi 23,443 21,458 9 Citigroup  U.S.
Hewlett-
12  13 1 22,197 20,458 9 Hewlett-Packard  U.S.
Packard
13  15 2 BMW 21,612 19,617 10 BMW  GERMANY
14  12 -2 Marlboro 21,283 21,350 0 Altria  U.S.
American
15  14 -1 20,827 19,641 6 American Express  U.S.
Express
16  16 0 Gillette 20,415 19,579 4 Procter & Gamble  U.S.
Louis Vitton Moet
17  17 0 Louis Vuitton 20,321 17,606 15 FRANCE
Hennessy 
18  18 0 Cisco 19,099 17,532 9 Cisco  U.S.
19  19 0 Honda 17,998 17,049 6 Honda Motor  JAPAN
20  24 4 Google 17,837 12,376 44 Google  U.S.
21  20 -1 Samsung 16,853 16,169 4 Samsung  S. KOREA
22  21 -1 Merrill Lynch 14,343 13,001 10 Merrill Lynch  U.S.
23  28 5 HSBC 13,563 11,622 17 HSBC Holdings  BRITAIN
24  23 -1 Nescafe 12,950 12,507 4 Nestle  SWITZERLAND
25  26 1 Sony 12,907 11,695 10 Sony  JAPAN
26  22 -4 Pepsi 12,888 12,690 2 PepsiCo  U.S.
27  29 2 Oracle 12,448 11,459 9 Oracle  U.S.

23
 United Parcel
28  32 4 UPS 12,013 10,712 12 U.S.
Service 
29  31 2 Nike 12,004 10,897 10 Nike  U.S.
30  27 -3 Budweiser 11,652 11,662 0 Anheuser-Busch  U.S.
31  25 -6 Dell 11,554 12,256 -6 Dell Inc.  U.S.
32  33 1 JPMorgan 11,433 10,205 12 JPMorgan Chase  U.S.
33  39 6 Apple 11,037 9,130 21 Apple  U.S.
34  34 0 SAP 10,850 10,007 8 SAP  GERMANY
35  37 2 Goldman Sachs 10,663 9,640 11 Goldman Sachs  U.S.
36  35 -1 Canon 10,581 9,968 6 Canon  JAPAN
Morgan
37  36 -1 10,340 9,762 6 Morgan Stanley  U.S.
Stanley
38  41 3 Ikea 10,087 8,763 15 Ikea   SWEDEN
39  42 3 UBS 9,838 8,734 13 UBS AG  SWITZERLAND
40  40 0 Kellogg's 9,341 8,776 6 Kellogg Company  U.S.
41  30 -11 Ford 8,982 11,056 -19 Ford Motor  U.S.
Koninklijke Philips NETHERLAND
42  48 6 Philips 7,741 6,730 15
Electronics  S
43  44 1 Siemens 7,737 7,828 -1 Siemens  GERMANY
44  51 7 Nintendo 7,730 6,559 18 Nintendo   JAPAN
Harley-
45  45 0 7,718 7,739 0 Harley-Davidson  U.S.
Davidson
46  46 0 Gucci 7,697 7,158 8 Gucci Group  ITALY
American
47  NR NA AIG 7,490 NA NA U.S.
International Group 
48  47 -1 eBay 7,456 6,755 10 EBAY  U.S.
49  NR NA AXA 7,327 NA NA AXA  FRANCE
50  49 -1 Accenture 7,296 6,728 8 Accenture  BERMUDA
51  53 2 L’Oréal 7,045 6,392 10 L'Oreal  FRANCE
52  50 -2 MTV 6,907 6,627 4 Viacom  U.S.
53  54 1 Heinz 6,544 6,223 5 Heinz  U.S.
54  56 2 Volkswagen 6,511 6,032 8 Volkswagen  GERMANY
55  55 0 Yahoo! 6,067 6,056 0 Yahoo  U.S.
56  57 1 Xerox 6,050 5,918 2 Xerox  U.S.
57  58 1 Colgate 6,025 5,633 7 Colgate-Palmolive  U.S.
58  61 3 Chanel 5,830 5,156 13 Chanel  FRANCE
59  59 0 Wrigley's 5,777 5,449 6 Wm. Wrigley Jr.  U.S.
60  60 0 KFC 5,682 5,350 6 Yum Brands  U.S.
61  52 -9 Gap 5,481 6,416 -15 The Gap  U.S.
62  65 3 Amazon.com 5,411 4,707 15 Amazon.com  U.S.
63  63 0 Nestle 5,314 4,932 8 Nestle  SWITZERLAND
64  73 9 Zara 5,165 4,235 22 Inditex  SPAIN

24
65  62 -3 Avon 5,103 5,040 1 Avon Products  U.S.
66  68 2 Caterpillar 5,059 4,580 10 Caterpillar  U.S.
67  67 0 Danone 5,019 4,638 8 Groupe Danone  FRANCE
68  74 6 Audi 4,866 4,165 17 Volkswagen  GERMANY
69  71 2 Adidas 4,767 4,290 11 adidas  GERMANY
70  64 -6 Kleenex 4,600 4,842 -5 Kimberly-Clark  U.S.
71  72 1 Rolex 4,589 4,237 8 Rolex  SWITZERLAND
72  75 3 Hyundai 4,453 4,078 9 Hyundai Motor  S. KOREA
Hermes
73  81 8 Hermes 4,255 3,854 10 FRANCE
International 
74  66 -8 Pizza Hut 4,254 4,694 -9 Yum Brands  U.S.
75  80 5 Porsche 4,235 3,927 8 Porsche  GERMANY
76  78 2 Reuters 4,197 3,961 6 Reuters Group  BRITAIN
77  69 -8 Motorola 4,149 4,569 -9 Motorola  U.S.
Matsushita Electric
78  77 -1 Panasonic 4,135 3,977 4 JAPAN
Industrial 
79  82 3 Tiffany 4,003 3,819 5 Tiffany  U.S.
80  NR NA Allianz 3,957 NA NA Allianz  GERMANY
NETHERLAND
81  85 4 ING 3,880 3,474 12 ING Groep 
S
82  70 -12 Kodak 3,874 4,406 -12 Eastman Kodak  U.S.
83  86 3 Cartier 3,852 3,360 15 Cartier  FRANCE
84  76 -8 BP 3,794 4,010 -5 BP plc  BRITAIN
Moët & Louis Vitton Moet
85  87 2 3,739 3,257 15 FRANCE
Chandon Hennessy 
86  79 -7 Kraft 3,732 3,943 -5 Kraft Foods  U.S.
Louis Vitton Moet
87  83 -4 Hennessy 3,638 3,576 2 FRANCE
Hennessy 
88  91 3 Starbucks 3,631 3,099 17 Starbucks  U.S.
89  84 -5 Duracell 3,605 3,576 1 Procter & Gamble  U.S.
Johnson &
90  88 -2 3,445 3,193 8 Johnson & Johnson  U.S.
Johnson
91  93 2 Smirnoff 3,379 3,032 11 Diageo  BRITAIN
92  92 0 Lexus 3,354 3,070 9 Toyota Motor  JAPAN
93  89 -4 Shell 3,331 3,173 5 Royal Dutch Shell  BRITAIN
94  96 2 Prada 3,287 2,874 14 Prada  ITALY
95  98 3 Burberry 3,221 2,783 16 Burberry  BRITAIN
96  99 3 Nivea 3,116 2,692 16 Beiersdorf  GERMANY
97  94 -3 LG 3,100 3,010 3 LG  S. KOREA
98  90 -8 Nissan 3,072 3,108 -1 Nissan Motor  JAPAN
99  NR NA Polo RL 3,046 NA NA Polo Ralph Lauren  U.S.
100  NR NA Hertz 3,026 NA NA Hertz Global U.S.

25
 Holdings 

Branding Glossary

Brand is a name, term, design, symbol, or any other feature that identifies one seller's good
or service as distinct from those of other seller.

Brand building Developing a brand's image and standing with a view to creating long term
benefits for brand awareness and brand value.

Brand equity Brand equity refers to the value of a brand. Brand equity is based on the
extent to which the brand has high brand loyalty, name awareness, perceived quality and
strong product associations. Brand equity also includes other “intangible” assets such as
patents, trademarks and channel relationships.

Brand extension Brand extension refers to the use of a successful brand name to launch a
new or modified product in a new market. Virgin is perhaps the best example of how brand
extension can be applied into quite diverse and distinct markets.

Brand identity how the company sees it self and the product.

Brand image Brand image refers to the set of beliefs that customers hold about a particular
brand. These are important to develop well since a negative brand image can be very difficult
to shake off.

26
Brand loyalty A strongly motivated and long-standing decision to purchase a particular
product or service.

Brand name is the part of a brand that can be spoken—including letters, words, and
numbers—.

Brand mark The element of a brand that is not made up of words—often a symbol or
design—.

Brand message the message that the organization wishes to communicate to the
customer about qualities of its product.

Brand recognition A customer's awareness that a brand exists and is an alternative to

purchase.

Brand stretching refers to the use of an established brand name for products in
unrelated markets.

Distributor brands are created and owned by businesses that operate in the
distribution channel – often referred to as “Own-label”.

Family brand name is used for all products.

Generic brands indicate only the product category and not include the company name
or other identifying terms.

Manufacturer brands are created by producers and bear their chosen brand name. The
producer is responsible for marketing the brand. The brand is owned by the producer.

The battle of the brands the competition between dealer brands and manufacturer
brands

Trademark Legal designation indicating that the owner has exclusive use of a brand

Trade name a full legal name of an organization

Copyright Is the exclusive legal rights to reproduce, publish, and sell the matter and form of
a literary, musical, or art

27
 REFERENCES

English references
.Principles of marketing, Kotler.P, Armstrong.G, The prentice hall, 2000 )1
Advertising, Wells.W , Mariarty.S , Burnett.J, Pearson education , )2
.International Edition ,2006
Marketing concepts and strategies, Pride.W, FERRELL.O, Library Ed., )3
.Houghton Mifflin, 2003
.Advertising, promotion, Shimp.T, 6th Ed., Thomson south western, 2002 )4

Web references
www.tutor2u.net/business )1
www.wikipedia.com )2
www. brandculture.com )3

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29
 Dana Kakeesh

-FINISHED-

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