8.0 managing brands
TRANSCRIPT
Managing Brands
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What Constitutes a Brand? Name Term Symbol Sign Design Trademark Logo
Package design Sound Spokesperson Smell Or any other unique
element that identifies a firm’s product
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Importance Of Branding – Consumer Viewpoint
Easy means of identification Helps in evaluating quality of products Provides psychological rewards (status,
prestige, etc.)
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Importance Of Branding – Marketer’s Viewpoint
Creates brand identity Aid in advertising and display Helps increase control and market share Reduces price comparisons and stabilizes
prices Facilitates expansion of product mix
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Basic Branding Concepts Brand associations: meanings product has
for customers. Brand identity: associations firm wants
people to hold. Brand image: associations people actually
hold. Brand personality: enduring and distinct
human characteristics associated with brand. Brand positioning: attempts to align brand
image with brand identity.
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Customers’ View of Brand Perceptions and associations about
product, service or company. Embody values that create meaning for
customers. Meanings represent promise of experience
customers expect when use brand.
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Brand Associations Can be built on:
Attributes, benefits, values, culture, personality, user
Effective brand associations: Strong – relevant, consistent over time Favorable – desired and delivered by brand Unique
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GeneralElectric
reliable
American
women
kitchen
appliance
vacuumcleaner
electric
powertool
sanderdrill
men
garage
clean
sawdust
robust
Black &Decker
Customer View: Brand Associations
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Levels of Branding
Carrefour CitiGroup
IBM
Ragu, Claritin, Chevrolet
Camry, Fiesta, Leaf, MX-5 Miata
Group of Products
Product Line
Individual Product
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Brand’s Tangible Impact on Consumers’ Product Experience
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Source: de Chernatony and McDonald (1992)
5144
Blind test
…tastesbetter
...tastesbetter
Indifferent
5
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Brand’s Tangible Impact on Consumers’ Product Experience
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Source: de Chernatony and McDonald (1992)
5
5144
Blind test
…tastesbetter
...tastesbetter
Indifferent
23
65
12
Open test
...tastesbetter
...tastesbetter
Indifferent
5
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Characteristics ofGood Brand Name
Creates positive connotation. Is memorable. Positions product by conveying image or
personality (Ford Mustang) or describing how it works (Drano).
Is easy to say, spell, read, and remember (Tide, Gleem).
Fits target market, product benefits (e.g., Beauty rest, 5 Hour Energy, Minute Rice) , customer’s culture, and legal requirements.
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Brand Equity DefinitionsCustomer Brand Equity – brand value to customers
Value received from brand, over and above unbranded version.
Firm Brand Equity – brand value to firm
Brand’s cash flow streams over and above unbranded alternative.
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Factors Leading to High Customer Brand Equity
Comparing alternative products is difficult. Customers do not realize value until some
time after purchase Customers inexperienced or unfamiliar with
product class Product quality from some suppliers is
variable Product is socially visible Mental flexibility in portraying brand
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Leading U.S. Brands1925 and 2000
Product Leading Brand 1925
Position2011
Product Leading Brand 1925
Position2011
Batteries Eveready Leader Razors Gillette LeaderBreakfast cereal
Kellogg Leader Shortening Crisco Leader
Canned fruit Del Monte Leader Soap Ivory LeaderChewing gum Wrigley Leader Soft drink Coca-Cola LeaderChocolates Hershey Leader Soup Campbell’s LeaderCookies Nabisco Leader Tea Lipton LeaderFlour Gold Medal Leader Tires Goodyear LeaderPaint Sherwin-
WilliamsLeader Toothpaste Colgate Leader
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Advantages ofHigh Firm Brand Equity
Higher prices and better margins More easily introduce similarly branded items
in different product classes and markets Use cross-selling to encourage existing
customers to purchase different product classes
Generate leverage in distribution channels Raise entry barriers for competitors Exploit licensing opportunities
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Brand Values 2010:Interbrand MethodTop 10
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Rank (2010)
Brand Name Country of Origin
Industry Firm Brand Equity ($U.S. billion)
1 Coca-Cola U.S. Beverages $70.52 IBM U.S. Computers $64.73 Microsoft U.S. Software $60.94 Google U.S. Internet $43.65 McDonald’s U.S. Food $33.66 General Electric U.S. Diversified $42.87 Intel U.S. Computers $32.08 Nokia Finland Telecoms $29.59 Disney U.S. Entertainment $28.710 Hewlett-Packard U.S. Computers $26.9
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Branding Strategies Individual (Multi) branding – using
different brand names for different products Example: Proctor & Gamble detergents –
Bold, Cheer, Dash, Era, Gain, Ivory Snow, Oxydol, Tide
Pros: “Clear” identity Cons: More expensive to introduce
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Branding Strategies (cont’d) Umbrella/family branding – marketing
several different products under the same brand name Examples: Heinz and Del Monte
Pros: Less expensive to introduce Cons: If new product fails, can “pollute”
family name
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Branding Strategies (cont’d) Combination branding – combines a
family brand name and an individual brand name Examples: Microsoft XP, Microsoft Office
Corporate branding - practice of using a company's name as a brand name Examples: Intel, Mercedes, IBM
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Line and BrandExtension Strategies
Line extension - Use current brand to enter new market segment in product class ( New flavors, forms, color, ingredients, package sizes
etc. Examples: Michelob, Michelob Light
Arrid, Arrid Extra Dry
Brand extension - Use current brand name to enter completely different product class Brand broadening (leveraging) Examples: Honda Cars to Lawnmowers, Swiss Army
Knives to Luggage
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Brand Extension Strategy New products that build on brand equity of
existing brand Advantages:
Instant name recognition Establish quality levels Saves on advertising costs
Risks Bad products may damage image of other products Dilution of distinctiveness
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Branding Strategies (cont’d)
Licensing: sells right to use brand name for specific purpose and time
Co-branding: combines two brands
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Repositioning Brand Target new market segment(s) Change brand associations Alter the competitive target
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