mfs branding

8/8/2019 Mfs Branding

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A. Individual product decisions

We will focus on the important decisions in the development and marketing of individual

productsand services. These decisions are about product attributes, branding, packaging, labeling, and

product support services. Companies have to develop strategies for the items of their productlines. Marketers make individual product decisions for each product including: product attributesdecisions, brand, packaging, labeling, and product-support services decisions. Product attributes

deliver benefits through tangible aspects of the product including features, and design as well asthrough intangible features such as quality and experiential aspects

A brand is a way to identify and differentiate goods and services through use of a name or distinctive

design element, resulting in long-term value known as brand equity. The product package and labeling

are also important elements in the product decision mix, as they both carry brand equity through

appearance and

affect product performance with functionality. The level ofproduct-support services provided can also

have a major effect on the appeal of the product to a potential buyer.

Individual product decisions

a) Product Attributes

Developing a product or service involves defining the benefits that it will offer. These benefitsare

communicated to and delivered by product attributes such as quality, features, style and design.

i. Product Quality

Quality is one of the marketer's major positioning tools. Product quality has two dimensionslevel and consistency. In developing a product, the marketer must first choose a quality levelthat

willsupport the product's position in the target market. Here, product quality meansperformance

qualitythe ability of a product to perform its functions beyond quality level, high quality alsocan

mean high levels of quality consistency. Here, product quality means conformance qualityfreedom

from defects and consistency in delivering a targeted level of performance. All companies should

strive for high levels of conformance quality.

ii. Product Features

A product can be offered with varying features. A stripped-down model, one without any extras,is

the starting point. The company can create higher-level models by adding more features.Features


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are a competitive tool for differentiating the company's product from competitors' products.Being

the first producer to introduce a needed and valued new feature is one of the most effective waysto compete.

How can a company identify new features and decide which ones to add to its product? The

company should periodically survey buyers who have used the product and ask these questions:How do you like the product? Which specific features of the product do you like most? Whichfeatures could we add to improve the product? The answers provide the company with a rich list

of feature ideas. The company can then assess each feature's value to customers versus its costtothe

company. Features that customers value little in relation to costs should be dropped; those thatcustomers value highly in relation to costs should be added.

iii. Product Style and Design

Another way to add customer value is through distinctiveproduct style and design. Some

companieshave reputations for outstanding style and design. Design is a larger concept than style. Style

simplydescribes the appearance of a product. Styles can be eye catching or yawn producing. A

sensationalstyle may grab attention and produce pleasing aesthetics, but it does not necessarily make the

productperformbetter. Unlike style, design is more than skin deepit goes to the very heart of aproduct. Good design contributes to a product's usefulness as well as to its looks.

Good style and design can attract attention, improve product performance, cut production costs,and give the product a strong competitive advantage in the target market

Perhaps the most distinctive skill of professional marketers is their ability to create, maintain,protect, and enhance brands of their products and services. A brand is a name, term, sign,symbol, or design, or a combination of these, that identifies the maker or seller of

a product or service. Consumers view a brand as an important part of a product, and brandingcan add value to a product. For example, most

consumers would perceive a bottle of White Linen perfume as a high-quality, expensive product.But the same perfume in an unmarked bottle would likely be viewed as lower in quality, even if

the fragrancewere identical. Branding has become so strong that today hardly anything goes unbranded.

Branding helps buyers in many ways.Brand names help consumers identify products that might benefit them. Brands also tell the

buyersomething about product quality. Buyers who always buy the same brand know that they will get

the same features, benefits, and quality each time they buy. Branding also gives the seller severaladvantages. The brand name becomes the basis on which a whole story can be built about aproduct's special qualities. The seller's brand name and trademark provide legal protection for

unique product features that otherwise might be copied by competitors. Branding also helps theseller to segment markets.


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i. Brand:

A brandis a name, sign, symbol, or design, or a combination of these that identifies the

maker or seller of a product or service.

ii. Brand equity

is the value of a brand, based on the extent to which it has high brand loyalty, name awareness,

perceived quality, strong brand associations, and other assets such as patents, trademarks, andchannel relationships. Powerful brand names command strong consumer preference and are

powerful assets. Perhaps the most distinctive skill of professional marketers is their ability tocreate, maintain, protect, and enhance brands. Measuring the actual equity of a brand name is

difficult. However, the advantages of having it include:1). High consumer awareness and loyalty.

2). Easier to launch brand extensions because of high brand credibility.3). A good defense against fierce price competition.

4). It is believed to be the companys most enduring asset. Customer equity tends to aidmarketing planning in assuring loyal customer lifetime value.

iii. Selecting The Brands Name:

Selecting a brand name is an important step. The brand name should be carefully chosen since a

good name can add greatly to a products success. Desirable qualities of a good brand nameinclude:

1). It should suggest something about the products benefits and qualities.2). It should be easy to pronounce, recognize, and remember.

3). It should be distinctive.

4). It should translate easily into foreign languages.5). It should be capable of registration and legal protection. Once chosen, the brand namemust be protected.

iv. Sponsorship options for Branding:

A manufacturer has four sponsorship options:1). A manufacturers brand (or national brand) is a brand created and owned by the

producer of a product or service (Examples include IBM and Kellogg).2). A private brand (or middleman, distributor, or store brand) is a brand created and

owned by a reseller of a product or service.

3). A licensed brand (a company sells its output under another brand name).4). Co-branding occurs when two companies go together and manufacture one product(General Mills and Hersheys make Reeses Peanut Butter Puffs cereal).

Combined brands create broader customer appeal and greater brand equity.It may allow a company to expand its existing brand into a category it might otherwise have

difficulty entering alone. But at the same time there are certain disadvantages of combinebranding

like:


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Complex legal contracts and licenses are involved. Coordination efforts are often difficult.

Trust is essential between partners. It is often hard to come by.At one time manufacturers brands were the most popular and profitable. Today, however, an

increasing number of private brands are doing well. Though hard to establish and maintain,

privateb

rands can yield higher profit margins. The battle of the brands (the competitionbetween manufacturers and private brands) causes resellers to have advantages, and they chargemanufacturersslotting fees (payments demanded by retailers from producers before they will

accept new products and find slots for them on the shelves). As store brands are improving inquality, they are posing a stronger threat to the manufacturers brands. This is especially true in

supermarkets.

v. Branding Strategy:

A company has four choices when it comes to brand strategy. It can:1). Introduce line extensions. Existing brand names are extended to new forms, sizes, and

flavors of an existing product category. A company might introduce line extensions as a low-cost,

low-risk way of introducing new products in order to:a). Meet consumer desires for variety.

b). Meet excess manufacturing capacity.c). simply command more shelf space.

Risks include:a). An overextended brand might lose its specific meaning.

b). Can cause consumer frustration or confusion.2). Introduce brand extensions. Existing brand names are extended to new or modified

product categories. Advantages include:

a). Helps a company enter new product categories more easily.b). Aids in new product recognition.c). Saves on high advertising cost.

3). Introduce multibrands. New brand names are introduced in the same productcategory. Advantages include:

a). They gain more shelf space.b). Offering several brands to capture brand switchers. The company can establish

flanker or fighter brands to protect its major brand.

c). It helps to develop healthy competition within the organization.Drawbacks include:

a). Each brand may only obtain a small market share and be unprofitable.4). Introduce new brands. New brand names in new categories are introduced.

Advantage include:a). Helps move away from a brand that is failing.b). Can get new brands in new categories by corporate acquisitions. Some companies

are now pursuing mega brand strategies.Drawbacks can include:

a). Spreading resources too thin.


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c) Packaging

Packaging involves designing and producing the container or wrapper for a product. The package

may include the product's primary container (the tube holding Colgate toothpaste); a secondarypackage that is thrown away when the product is about to be used (the cardboard box containing

the tube of Colgate); and the shipping package necessary to store, identify, and ship the product(acorrugated box carrying six dozen tubes of Colgate toothpaste). Labeling, printed information

appearing on or with the package, is also part of packaging.Traditionally, the primary function of the package was to contain and protect the product. In

recent times, however, numerous factors have made packaging an important marketing tool.Increased competition and clutter on retail store shelves means that packages must now perform

many sales tasksfrom attracting attention, to describing the product, to making the sale.Companies are realizing the power of good packaging to create instant consumer recognition of

the company or brand. Developing a good package for a new product requires making manydecisions. First, the company must establish thepackaging concept, which states what the

packageshould be ordo for the product. Should it mainly offer product protection, introduce a new

dispensing method, suggest certain qualities about the product, or something else? Decisionsthen

must be made on specific elements of the package, such as size, shape, materials, color, text, andbrand mark. These elements must work together to support the product's position and marketing

strategy. The package must be consistent with the product's advertising, pricing, and distribution.

d) Labeling

Labels may range from simple tags attached to products to complex graphics that are part of the

package. They perform several functions. At the very least, the label identifies the product orbrand, such as the name Sunkist stamped on oranges. The label might also describe severalthings

about the productwho made it, where it was made, when it was made, its contents, how it is tobe used, and how to use it safely. Finally, the label might promote the product through attractive

graphics.

e) Product Support Services

Customer service is another element of product strategy. A company's offer to the marketplaceusually includes some services, which can be a minor or a major part of the total offer. Later in

thechapter, we will discuss services as products in themselves. Here, we discussproduct support

servicesservices that augment actual products. More and more companies are using product support

services as a major tool in gaining competitive advantage.A company should design its product and support services to profitably meet the needs of target

customers. The first step is to survey customers periodically to assess the value of currentservices


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and to obtain ideas for new ones. For example, Cadillac holds regular focus group interviewswith

owners and carefully watches complaints that come into its dealerships. From this careful

monitoring, Cadillac has learned that buyers are very upset by repairs that are not done correctly

the first time.Once the company has assessed the value of various support services to customers, it must next

assess the costs of providing these services. It can then develop a package of services that will both

delight customers and yield profits to the company.

Product and Services Decisions

Marketers make decisions on three levels: Individual products decisions, products line decisionsand product mix decisions.

Individual Product Decisions:

Developing a product involves defining the benefits it will offer. These benefits are attributed by

quality, features, style and design:

y Quality: It is directly linked to customer value and satisfaction. Quality can be defined asfreedom from defects. Product quality has two dimensions: level and consistency. Interms of quality level, quality means performance quality meaning the ability to perform

its function. In terms of quality consistency, quality means conformance quality meaningfreedom from defects and consistency in delivering performance.

y Features: Features are a competitive tool for differentiating the companys product fromcompetitors product.

y Style and Design: Style simply describes the appearance of a product. However, design ismore than skin deep it goes to the very heart of the product. Good design contributes to

usefulness as well as looks. It begins with an understanding of customer needs.y Branding: A brand is a name, term, sign, symbol or design or a combination of these that

identifies the maker of a product. Brand names helps consumers to identify products thatmight benefit them. The brand name provide legal protection for unique product features

and help the seller to segment the market.y Packaging: Packaging involves designing and producing the container or wrapper for a

product. It includes a primary container, a secondary package and a shipping container.For example, the Colgate tube is the primary container, its box is the secondary package

and the container containing dozens of Colgates is the shipping container.


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y Labeling: The label identifies the product or brand. It can describe many things about theproduct like who made it, where and when it was made, its contents etc. For example,

brand name Sheffer has a label since 1986.y Product Support Services: Customer service is another element of product strategy. A

companys offer usually includes some support services.

Product Line Decisions:A product line is a group of products that are closely related because they function in a similar

way or because they are sold to the same customers or because they are marketed through sameoutlets or because they have same prices.

Product line length: Number of items in the product line. The line is too short if the manager can

increase profits by adding items. The line is too long if profits can be increased by droppingitems. A product line can be lengthened by line stretching or line filling. The line can be

stretched downward, upward or both ways!

Product Mix Decisions

Product mix is also known as Product Portfolio. It is the set of all product lines and items that a

seller offers for sale. It has four important dimensions:

y Width:Number of different product lines.y Length: Number of items within a product line.y Depth: Number of versions for each product in a product liney Consistency: Refers to how closely related the various product lines are.

A company can increase its business in four ways:

y By increasing product lines (increasing width)y Producing more products of specific type (increasing length)y Adding more versions of some specific products (increasing depth)y Increase consistency

Thus the product mix dimensions provide the handles for defining the companys product

strategy.

Decision making points

1. Money. With certain products and services, you can demand much higher fees, but oftentheres a trade-off of time or cost to you as well.

2. Creation/performance time. With every product and service, theres a set amount oftime required of you to actually create it or perform it. Some are more automated, once


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you put in the initial creation time; some are group-centric, allowing you to leverage yourtime; others limit you to working with one client at a time.

3. Lead generation time.Some products and services, especially big-ticket items, havelonger sales cycles, while others require you to generate higher quantities of traffic in

order to reach certain sales levels, so its important to consider the amount of time and

energy required of you to generate customers or clients to purchase the product orservice. It might also be important for you to start generating income quickly, and certainproducts and services can take much longer to generate profit than others.

4. Emotional labor involved. Its not something we usually think about, but every productand service requires a certain amount ofemotional labor. Writing a book, for instance,

might require a lot more emotional labor from you than meeting with a client for aconsulting call. You have to consider how important emotional labor is to you, and if its

realistic to expect yourself to do emotionally demanding work for long periods of time.5. Long-term stability and sustainability. Some considerations will be more indirect or

intangible, like long-term stability and sustainability. For instance, you might preferdoing more work up front, if it ensures greater flexibility and freedom later, or you might

want to know that you dont have to work at an intense pace for too long.6. Growth potential and saleability. Some products and services might limit your growthpotential or your ability to sell your business down the road, especially if they requireyour direct input.

Extra data

When making consumption choices, consumers do not only pick a product; they choose the

whole system that supports it. Just like the tip of an iceberg, products are one visible part of asystemthe point of contact with the consumer and the end result of a complex brand

management process.

The idea that brands go beyond products or services is by no means new. But how can businesses

create an environment in which every decision, however small and seemingly not marketing-related, is in line with the brand vision?

Brands as systems

The first thing to acknowledge is that brand management is not synonymous with marketing.


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If we see brands as a system, then every aspect of a companys activity falls into the scope ofbranding. In short, brand management is everybodys business. This may sound trite and

idealistic, but consider that when you buy an iPod in an Apple Store you are paying for the niceenvironment and the pleasant in-store experience. When buying products from the Body Shop

you are paying for the eco-friendly way products are sourced and developed. When buying from

GE you are paying for its customer service infrastructure. All of these elements are part of thesystems that support the individual products. Customers often dont think of these behind thescenes attributes as attached to the products they buy but without them these brands would not

be as expensive, and would likely not be household names. Brand management, therefore, cutsacross departments and functions and includes decisions made at every step of the value chain.

So how can you coordinate all of these decisions to serve your brand?Brands are built by micro-level decisions

Despite the best intentions of marketing managers and CEOs, brands are just as much built bypeople at lower levels within an organization, especially those that interact directly with

customers or other external stakeholders. The associations people make with a company orproduct are the result of thousands of individual decisions made throughout the value chain.

Few people fully understand the importance of micro-level decisions in brand building. Focusingon the macro (grand plans, vague mission statements, etc.) gives a sense of accomplishment and

importance but may not help many of the individuals involved in building and sustaining thebrand. For employees to make decisions that collectively strengthen the brand, they need to have

a clear sense of what the desired outcome is and how their individual work serves the brandpromise. This sense of clarity is key to building strong systems that support the brand. Without

it, employees cant direct their efforts properly and the system lacks coherence.At the company level, one of the ways of providing this sense of clarity is through a company

constitution that states in clear, unequivocal terms the firms objectives and its principles. Likean actual constitution, the document should be a tool destined to guide operational and strategic

decision-making. When all employees, from senior management to receptionists, make theirmicro-level decisions based on the same principles and using the same criteria, coherence ensues

and brands are stronger as a result.At the department level, one of managers key responsibilities must be creating an environment

in which every staff member has a clear sense of how his or her work affects the final productand supports the brand promise. Brand building is a collective task, not something done by a

small group of marketing gurus and advertisers. Every employee must understand this andrealize that his or her work is not detached from brand management.

ConclusionWhen everybody in the company has a clear sense of what the brand proposition is and what

their role is in supporting it, the system behind the brand is strong and processes and innovationsarise that support the brand message. Against a backdrop of rapidly commoditizing products and

services and increasing competition in nearly every sector across the globe, building robustsystems to support product and service brands will be even more vital in the years to come.

Effectively coordinating micro-level decisions throughout an organization is a critical step in thisprocess.

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