Ch 5 n 6 part 1

Designing Marketing Programs to

Build Brand Equity
Topics/Chapter Heads
Identify few contemporary
perspectives and developments in
Marketing
How do marketing activities in generaland product,
pricing, and distribution strategies in particularbuild
brand equity?
How can marketers integrate these activities to enhance
brand awareness, improve the brand image, elicit positive
brand responses, and increase brand resonance?
How to enhance product
experience
Explain the rational for Value
Pricing
List channel options
Reasons behind the growth in Pvt
Labels
 New Perspectives on Marketing
Rapid tech developments
Greater consumer empowerment
Fragmentation of traditional media
Growth of interactive and mobile
marketing options
Channel transformation
disintermediation
Increased competition and industry
convergence
Globalization and the growth of
Emerging Markets
Greater env and social concerns
Economic recessions
 New Capabilities of the New Perspectives

Marketers

Better geo reach in terms of spreading info and promoting

products
Better platforms to net market oriented intelligences to facilitate
research
Offer better cus service through interactive platforms
Better utilization of relationship marketing in terms of opt in IMC
Better opportunity of co production and customization
Better opportunity in terms of internal communications:
recruiting, training, accounting etc
Contact Points: to generate Brand Equity

External: Personal Sources, Public

Sources, Marketers controlled IMC
platforms
Internal: experiences, memories
The manner in which brand associations
are formed does not matter
Only the resulting awareness,
knowledge, favorability and uniqueness
of the association matters
Types of Personalizing Marketing
 Experiential Marketing

Experience Business is to charge for the

time consumers spend with you. (Pine and
Gilmore)
Experiential Marketing is descried as any form of
customer-focused marketing activity, at various
touch points , that creates a sensory-emotional
connection to customers (Bernd Schmitt)
 Experiential Marketing
5 types of Marketing Experiences or Strategic Experience Modules (SEMs)

Sense Marketing: Appeals to senses ( sight,

sound, touch, taste and smell)
Feel Marketing : Appeals to inner feelings
(preference) and emotional bonding . Induce
sentiments, trust, love, etc
Think Marketing : Appeals to the intellect in
order to deliver cognitive and problem solving
experiences that engage cus creatively. Make
them think. Convergent/Divergent thinking
Act Marketing : targets physical behavior, life
style and interactions. Change in life style.
Alternative ways of doing things
Relate Marketing: creates experiences by
taking into account individuals desire to be
part of a social context.
These five different types of experiences (SEMs) are conveyed to individuals
through detailed, Integrated and consistent experience providers
(ExPros), which are vehicles such as:
A.communications: advertising, external and internal
company communications, public relations campaigns
B.visual and verbal identity and signage,
including names, logos, colors, etc.
C.product presence, including design, packaging, and
display
D.co-branding, involving event marketing,
sponsorships, alliances and partnerships, licensing,
product placement in movies, etc.
E.spatial environments: which include the external
and internal design of corporate offices, sales outlets,
consumer and trade fair spaces, etc.
F. web sites
G.people, including salespeople, company reps,
customer service providers, call center operators, etc
Cadbury Dairy Milk has revealed the next chapter of
the Joyville story with the launch of itsnew
product from Joyville - Marvellous Creations.

Two weeks ago Cadbury Dairy Milk shared some of

the first glimpses of Joyville, with the release of
a television commercial demonstrating where and
how Cadbury Dairy Milk milk chocolate is made.

The Marvellous Creations launch is the next major

Australian amplification of Cadbury Dairy Milk's
Joyville platform and is supported by an integrated
marketing campaign that includes advertising,
experiential, PR and digital elements.

In the new television commercial we learn that in

Joyville, there is no end to the inventiveness of the
chocolate chefs who are seen enthusiastically
creating the Marvellous Creations block.
Unexpectedly playful ingredients (jelly bits, beanies
and even popping candy) are dropped into a bowl
of delicious molten chocolate via chefs on trapezes,
whilst their roller-skating buddies spin the bowl into
which the iconic glass and a half of milk is pouring.
All this culminates in the creation of a wonderfully unusual looking block, with irregular 'paving stone-
shaped' pips, and a candy-like, carnival wrapper. The take out? A chocolate product made with
fantastically fun ingredients, and boundless energy, passion, and lashings of joy. Indeed, the more joy that
goes into the making of it, the better it tastes!The television commercial, a global execution developed by
Saatchi & Saatchi Sydney in conjunction with Saatchi Fallon UK, for use in Cadbury Dairy Milk markets
across the world, including the UK, is rolling out this weekend inAustralia. Initially, the Marvellous
Creations TVC will screen prime time across all networks as part of a major campaign. Digital, out- of-
home and experiential executions have also been developed and will feature across a wide range of
Australian websites and locations. Ben Wicks, general manager marketing chocolate for Cadbury Dairy
Milk, has described the launch of Marvellous Creations as the most significant innovation for Cadbury
Dairy Milk in 2012.

Says Wicks: "Through Marvellous Creations, we are bringing fun and excitement into the way Australians
enjoy their favourite chocolate, with the combination of unusual ingredients and flavours that literally
tantalise the taste buds with every bite. Wicks continued: "We know Marvellous Creations will surprise
and delight consumers. Many years of research and development have gone into this range and we
believe it is a category breaker that will be loved by Cadbury fans across the country. Since launching
Joyville, Australians have been eagerly awaiting the next instalment and we're delivering it with a
deliciously new tongue-tingling Cadbury Dairy Milk chocolate experience. The Joyville campaign builds
upon Cadbury Dairy Milk's long-standing 'glass and a half' brand promise, with an even more optimistic
message."

The first glimpse of Joyville was offered at Easter, where the purple chickens from the Joyville Easter Egg
farm bobbed up online as part of a four day experiential activity in Sydney. Over the coming months,
Australians will get more sneak peeks into Joyville as the concept is brought to life via experiential
activities and further above-the-line communications never seen before.
http://www.youtube.com/watch?v=vNb-V1Mh1rM, http://www.youtube.com/watch?v=qcXpyICJiEc
How Experiential Marketing works?
Most of the Experiential Marketing campaigns are event based with
consumer participation. Building a successful Experiential
Marketing campaign is easy the most difficult part is executing it well,
the more organized the event is, the positive the response.
Consumers like to see products and brands in control of their
marketing but still giving them enough control over their interaction
with the product. Its important to understand how a customer feels
and thinks when running such marketing campaigns, once you have a
thorough study of these factors, it gets much easier to steer the
customer to a direction that will relate the product to the consumer
at a personal level making the purchasing decision either on impulse
or a sudden necessity.
We see most of the Experiential Marketing campaigns in Europe and
NA, where brands are utilizing the social media response they get via
their customers on twitter, Facebook, foursquare, yelp and other
social media sites. Experiential Marketing London, Europe and other
NA marketing firms are on the top of this. They build some very
unique and memorable campaigns, have a look at few. These might
give you some idea of how well these ads are and how they
personally affect your perception towards the brand.
 https://www.youtube.com/watch?v=-cvv1oC-ZaM
https://www.youtube.com/watch?v=f4iQ3TCbqTk
https://www.youtube.com/watch?v=NnuUzYcUNvE
Live Augmented Reality-National Geographic

Spanair Unexpected Luggage

Volkswagen Marco Polo
Cadbury World
BBC frozen planet augmented reality
 Relationship Marketing

Benefits:

Acquiring new cus can cost 5times as much as

satisfying and retaining current cus
Each year a company loses 10% cus on n avg
5% reduction in the customer defection rate
can increase profit by 25 to 30%
Cus LTV
 3 Concepts of Relationship Marketing
1. Mass Customization : making products
to fit cus exact specification using tech.
CoProduction based.
Helps to reduce inventory
Required less warehouse space

2. One to One/1:1 Marketing: is a strategy

that relies on getting to know the individual
choices made by a customer, and then tailoring
marketing outreach to each customer
differently based on those choices. Its an
approach that is not used to get the customers
attention, but to keep their attention and
their business. Behavioral Targeting based.

3. Permission Marketing : Push Tech

based.
Mass Customization
Benefits of One-to-One Marketing
Creates switching costs for consumers
Reduces transaction costs for consumers
Maximizes utility for consumers
Enables companies to Treat different consumers differently
Different needs
Different values to firm
Current
Future (lifetime value)
Devote more marketing effort on most valuable consumers (and
customers)
1:1 Marketing Strategies
The Personal Touch: Few things make a bigger impression on a consumer than
personal attention and appreciation. The best coffee shop baristas know what Joes
order is the minute he walks through the door, and that keeps him coming back.
Investment bankers are expert 1:1 marketers. They get to know their clients
personalities and investment preferences and priorities, as well as what level of risks
theyre willing to take.
Suggestions for You Marketing: Online marketing companies like Amazon and
Netflix have become masters at collecting, storing, and interpreting customers click
history on their sites. They take that information and create a specialized marketing
plan just for each customer, with recommendations on the next book to read or the
next movie to watch.

Permission/Preferred-Customer Marketing: Many retailers now offer a no-cost

club membership to consumers. Club membership gives the customer incentives in
the form of lower prices or frequent-purchase rewards. In order to earn those
incentives, the customer must check-in with their membership ID. This allows the
company to track all items purchased during each visit. Once retailers know each
customers shopping patterns and preferencesthat a particular club member buys a
lot of cereal and prefers Cheerios, for examplethey can send out personalized
coupon mailers to that member with savings on Cheerios and other preferred items.
Any IMC prog must ensure: 6 Cs

1. Coverage
2. Contribution: build mind set and elicit market
performance/ response
3. Commonality: consistent and cohesive to brand
image
4. Complementarity: describe POPs and PODs based
Brand Associations
5. Comfortability: effective for different groups of
consumers . (Appeal and info wise)
6. Cost Effectiveness
 Supporting marketing mix (4Ps) should be designed to enhance
awareness and establish desired brand image.

Product: the heart of Brand Equity

Perceived quality and value
Focus on
Primary ingredients and
Supplementary features
Reliability
Durability and
Serviceability
Style and Design
Quality
Brand intangibles
Aftermarketing Tips for Loyalty Prog:
Customer Service Know your audience
User manual Change is good
Loyalty programs Listen to your best customers
Engage People
 Supporting marketing mix (4Ps) should be designed to enhance
awareness and establish desired brand image.

Pricing : the revenue making element that cus

uses to rank a brand in terms of quality
Consumer Price Perceptions
Price indicates perceived quality
Price Bands (acceptable prices within a price tier)
indicates the flexibility and breath marketers can
adopt in pricing their brands

Price reflects opportunity cost of time, energy and

any psychological involvement in the cus decision
making process
Value Based Pricing: marketers need to understand all
price perceptions that consumers have for a brand to
uncover quality and value relationship.
Single Marketer can have different labels with
different price bands
 Comparatively expensive items might seem
less expensive if the price is broken down
into smaller units.
Perceive price might vary from stated price.
Unpleasant surprises have a greater impact
on purchase than pleasant surprises.
Deep discount (EDLP) can lead to lower
perceived prices than frequent shallow
discounts (HILO).
Strong brands can command price premiums
but excessive price premiums
Setting Prices to Consumers will not pay Price
build Brand Equity Premiums that exceed their
includes perception of the value of the
Method for setting brand
current prices
A policy for choosing Frame of References of Customer-
the depth n duration of Price Perception
promotions and External: posted price
discounts Internal:
Approaches: Fair Price: what the product should cost
Value Pricing Typical Price
Price Last Price paid
Segmentation Least and most they would pay
EDLP Competitor Price
Expected future Price
Value Pricing: the right 3 components of Value Pricing
blend of quality, cost and
prices that fully satisfies the Product Design and Delivery:
NWDs of the consumers and innovative, unique products
the profit targets of the firm. Product Cost: supportive
structure: EOS, out sourcing,
JIT, less wastage, efficient raw
materials etc
Perceived Product Prices: what
value they perceive n to what
extent they will pay a price
premium
Communicate these values
properly in obvious and not so
obvious contexts
Segmented Pricing: Selling products of same cost at different prices to
different segments based on some criterions:

Customer Segment Pricing: special price for students/ under 18 at zoo,

cinema halls, etc
Product Form Pricing: based on different versions/sizes/packages of
products with same costing. Different sizes of cola bottles. Price
varies disproportionally with the quantity.
Location Pricing: same product but different pricing for different part of
the product. Different ticket prices for different seat of theater/
cinema hall/ stadium.
Time Pricing: when price varies with season/different timing.
Seasonal/different during different times of the day (web bidding)
EDLP
Wal-Mart, Shopno, K Mart, P&G (fluid pricing) etc

Problems
Forward Buying and Diverting : geo and time bound, over time
leads to operating expense
Brand Equity falls
Incentives based action erodes perceived quality on the brand

EDLP vs Value Based Pricing:

Lost revenue from a lower margin from on each item sold is often
much greater than the additional cost of value added activities due
yo the economies of scale
 Supporting marketing mix (4Ps) should be designed to enhance
awareness and establish desired brand image.

Channel : the aim is to develop profitable

Integrated shopping Experience that combines physical stores ( multi

branded/Specialized), Internet, Mobile, DM (Hybrid)
Direct Channel is needed
when:

Product info needs are

high
Product customization is
high
Quality assurance is imp
Purchase lot is high

The goal is to maximize

channel Coverage and
Effectiveness while
minimizing the Cost
Every Retailer has its own Brand Market
Awareness, Association, Intermediaries
Attachment, Attitude Activity in have greater
terms of their location, Bargaining Power
assortment, Pricing, Credit Policy, Value Delivery
Quality of service. Hence Network (
They have profound influence on Relationship Marketing
the Equity of the brands they through Trade Sales
carry under their name. Promotions and other
Incentives and
They add value to the brands Experiences ) ensures
through Shopper Marketing ( Better Shelving
brand building displays, Space
sampling promotions and in Push Strategies
store activities. play an important
Indirect Cannel role
Promotion: developing and spreading persuasive communication
about and offer. Eg: KK teas special promotion at meenabazaar.
Information: gathering and distributing marketing research and
intelligence info about actors/factors in the marketing environment
needed for planning and aiding exchange. Survey on Arong rice at
AGORA.
Contact: Finding and communicating with respective buyers. EG: the
more customers Nondon can pull, the more sales revenue for brands
that Nondon holds.
Matching: Shaping and fitting the offer to the buyers needs. EG:
After Sales services by Executive Motors for BMW, Anwar Group for
Ford
Physical Distribution: transporting and storing goods. AGORA
veg vans transport goods in DRA and Gulshan.
Risk Sharing
Direct Channel
1. Company Owned Store
Full Control
Showcase all Brand (SBUs) under the
umbrella brand
Bolster Brand image / Equity
2. Store within a Store
3. M-Commerce ( Ph, Text, App)
4. E- Commerce ( website, SMM)
5. Mail (Catalog)
 Response Process (how customers pass
through different stages)

1. Traditional Response Hierarchy models

a. AIDA model
b. Hierarchy of effects model
c. Innovation Adaption Model
d. Information processing model
2. Alternative Response Hierarchy
Standard learning Hierarchy
Dissonance/Attribution Hierarchy
Low Involvement Hierarchy
3. Cognitive Response Approach
4. The Elaboration Likelihood Model
 1.Response Process (how customers pass through
different stages): Traditional

1. Traditional Response Hierarchy models

 1.Response Process (how customers pass through
different stages): Traditional
a. AIDA Model: The AIDA model was developed to represent the
stages a salesperson must take a customer through in the personal-
selling process. This model depicts the buyer as passing
successively through attention, interest, desire, and action. Strong
levels of interest should create desire to own or use the product.
b. Hierarchy of Effects model shows the process by which advertising
works; it assumes a consumer passes through a series of steps in
sequential order from initial awareness of a product or service to
actual purchase. A basic premise of this model is that advertising
effects occur over a period of time. Advertising communication
may not lead to immediate behavioral response or purchase;
rather, a series of effects must occur, with each step fulfilled before
the consumer can move to the next stage in the hierarchy.
 Response Process (how customers pass through
different stages): Traditional
c. Innovation Adaption Model The innovation adoption model evolved
from work on the diffusion of innovations. This model represents the
stages a consumer passes through in adopting a new product or
service. Like the other models, it says potential adopters must be
moved through a series of steps before taking some action (in this
case, deciding to adopt a new product). The steps preceding adoption
are awareness, interest, evaluation, and trial. The challenge facing
companies introducing new products is to create awareness and
interest among consumers and then get them to evaluate the
product favorably. The best way to evaluate a new product is through
actual use so that performance can be judged. Marketers often
encourage trial by using demonstration or sampling programs or
allowing consumers to use a product with minimal commitment.
After trial, consumers either adopt the product or reject it.
Awareness Interest Evaluation trial Adoption
 Response Process (how customers pass through
different stages): Traditional
d. Information Processing Model: This model assumes the receiver in
a persuasive communication situation like advertising is an
information processor or problem solver. The series of steps a
receiver goes through in being persuaded constitutes a response
hierarchy. The stages of this model are similar to the hierarchy of
effects sequence; attention and comprehension are similar to
awareness and knowledge, and yielding is synonymous with liking.
McGuires model includes a stage not found in the other models:
retention, or the receivers ability to retain that portion of the
comprehended information that he or she accepts as valid or
relevant. This stage is important since most promotional campaigns
are designed not to motivate consumers to take immediate action
but rather to provide information they will use later when making a
purchase decision. The information processing model may be an
effective framework for planning and evaluating the effects of a
promotional campaign.
 2.Response Process (how customers pass
through different stages): Cognitive
Cognitive responses are the thoughts that occur to consumers
while reading, viewing, and/or hearing a communication.
These thoughts are generally measured by having consumers
write down or verbally report their reactions to a message.
The assumption is that these thoughts reflect the recipients
cognitive processes or reactions and help shape ultimate
acceptance or rejection of the message.
There are 2 focuses:
1. To determine the types of response
2. How these responses relate to attitudes towards
(ad/brand/purchase intention).
Response Process (how customers pass through
different stages): Cognitive
3 basic categories of Cognitive Responses:

1. Product Message Thoughts

2. Source Oriented Thoughts
3. Execution Thoughts
Response Process (how customers pass through
different stages): Cognitive
 Response Process (how customers pass through different
stages): Cognitive

1. Product/Message
thoughts: thoughts
those are directed at the
product or service
and/or the claims being
made in the
communication.

2 types of responses:
A. Counterarguments (
opposing the message:
negative)
B. Support arguments
(supporting the
communication)
The likelihood of counterarguing is
greater when the message
makes claims that oppose the
receivers beliefs
Response Process (how customers pass through different stages): Cognitive

2. Source-Oriented Thoughts:
what the receiver thinks about
the source of the
communication.

2 Types:
A. Source derogations/negative
thoughts: about the
spokesperson or organization
making the claims. Such
thoughts generally lead to a
reduction in message
acceptance.
B. Source bolsters: favorable
thought to the source
generate. Most advertisers
attempt to hire spokespeople
their target audience likes so
as to carry this effect over to
the message.
 Response Process (how customers pass through different stages): Cognitive
3.Ad Execution Thoughts:
individuals thoughts about the
ad itself. Many of the thoughts
receivers have when reading or
viewing an ad/communications
do not concern the product
and/or message claims directly.
Rather, they are affective
reactions representing the
consumers feelings toward the
ad. These thoughts may include
reactions to ad execution factors
such as the creativity of the ad,
the quality of the visual effects,
colors, and voice tones. Ad
execution-related thoughts can
be either favorable or
unfavorable. They are important
because of their effect on
attitudes toward the
advertisement as well as the
brand.
 Advertising Appeals
Advertising Appeal refers to the approach
used to attract the attention of consumer
and/or to influence their feelings towards the
product/service/cause.
Creative Execution Style is when a particular
appeal is turned into promotional message.
Very imp:
https://www.youtube.com/watch?v=Z0PmpKiBX6
0
 Different Types of Advertising
Appeals
1. Informational/Rational Appeal
2. Emotional Appeal
3. Combination of Emotional and Rational
4. Others (Seasonal, Festival, Teaser and
Reminder)
 Informational Appeal
Focuses on consumers'
practical, functional or
utilitarian needs
Emphasizes on benefits/reasons
why a consumer should own a
particular product/service
Some rational motives such as
comfort, convenience, economy,
health, quality, dependability,
durability, efficiency,
performance, etc are used as
basis for this type of advertising.
 Informational Appeal
Informational/rational appeals focus
on the consumers practical, functional, or utilitarian
need for the product or service and emphasize features of
a product or service and/or the benefits or reasons for
owning or using a particular brand.

Emotional appeals relate to the customers social and/or

psychological needs for purchasing a product or service.
Many consumers motives for their purchase decisions are
emotional, and their feelings about a brand can be more
important than knowledge of its features or attributes.
 Informational Appeal
5 types of rational/informational Appeals:
Feature: focuses on products beneficial traits ( usually
used for high involvement products)
Competitive Advantages: usually claims direct/indirect
superiority to rival brands
Favorable Price: makes the price offer the dominant point
of the message
News: makes product/brand related
announcement/awards dominate the message
Product Popularity: focuses on the popularity of the
product in terms on number of customers, switchers,
leadership positions, number of experts recommending
it, etc
Feature
Feature
Competitive Advantages
Competitive Advantages
Favorable Price
News Appeal
News Appeal
Product Popularity
Product Popularity
 Emotional Appeal

Emotional appeals relate to the

customers social and/or
psychological needs for purchasing a
product or service. Many consumers
motives for their purchase decisions are
emotional, and their feelings about a brand
can be more important than knowledge of
its features or attributes.
Emotional Appeal
 Emotional Appeal
Positive moods create positive attitudes towards brand
Emotional Integration is used.
Great bonding
Transformational ad: A transformational ad is defined as
one which associates the experience of using (consuming) the
advertised brand with a unique set of psychological characteristics
which would not typically be associated with the brand experience to
the same degree without exposure to the advertisement.
gives experience of using the brand/product a shape. Helps to
differentiate product/service. Usually done by creating image
advertising. EG
 Emotional Appeal
Transformational ads create feelings, images, meanings, and
beliefs about the product or service that may be activated when
consumers use it, transforming their interpretation of the usage
experience. Christopher Puto and William Wells note that a
transformational ad has two characteristics:
1. It must make the experience of using the product richer,
warmer, more exciting, and/or more enjoyable than that
obtained solely from an objective description of the advertised
brand.
2. It must connect the experience of the advertisement so tightly
with the experience of using the brand that consumers cannot
remember the brand without recalling the experience generated
by the advertisement.
 Brand Personality

An expression of the fundamental core

values and characteristics of a brand,
described and experienced as human
personality traits, eg friendly, intelligent,
innovative etc. It is an expression of the
relationship between the consumer and the
brand.
 Brand Personality

Levis: Rebellion, being cool

Marlboro: macho, freedom loving, adventures
Harley Davidson: Im different, macho, rugged,
powerful, wtc
Coke: conforming
Pepsi: irreverent
Combination Appeal
 Other Appeals

Seasonal
Festive/special public event
Reminder
Teaser
seasonal
Festive/
Special
Public
Event
Reminder
 Advertising Execution
Different Ways to present Message
Strait/Factual Message: product benefits/features based: info appeal
(high Involvement/B2B Product)
Scientific /Technical Evidences: technical info, results of scientific or
lab studies, endorsement by scientific bodies/supporting agencies
Demonstration (illustrate key advantages): DRTV
Comparison: competitive advantages based
Testimonials : personal experience, celeb endorsement/interesting
story, needs to be credible
Slice of Life: (problem solving)
Animation
Personality Symbol (energizer bunny, kfc, McDolands, etc)
Imagery : emotional appeal mainly: brand association with
image/Brand personality/ positioning.
Dramatization
Humor
Combination
Factual
Factual
Scientific

Scientific
Demonstration
Comparison
Testimonials
Testimonials
Problem solving
Imagery
Dramatize
 Dramatize

Animation
Animation
humor
 Creative tactics for Printing Ad
Headlines: Direct :strait forward and informative) /
Indirect (questions, indirect words, challenges, etc
Subheads: usually smaller than main heads but
larger than body copy in terms of font size
Body Copy: long enough to communicate and short
enough to hold readers interests. Comparison, price
appeals, humor, demonstration, etc
Visual Elements: colors, font, models, style, etc
Layout: physical arrangement of different parts.
 Creative tactics for TV Ad

Audio: catchy jingle, celebs for voiceover,

background music,
Video : action sequences. Colors, lighting,
graphics, models, style, theme, etc
 Planning and Production of TV Ad

3 phases of production
1. Pre Production
Selecting a director
Choosing a production company
Bidding
Cost and timing estimate
Production time table
Set construction
Location
Agency and clients approvals
Casting
Audio Selection and recording
Wardrobes
Follow up meetings
 Planning and Production of TV Ad

2. Production
Actual shoot
3. Post Production
Editing
Processing
Recording sound effects
Audio/Video Mixing
Client approval
Duplicating
Release