mu admi prod & brnd mgmt1

8/4/2019 MU ADMI Prod & Brnd Mgmt1

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Product and Brand

Management


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IdeaService

Goods

(Most Goods) ATL Activities

Product=

(Most Services)BTL Activities


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Brand Value Added BVA varies bysector

0

10

20

30

4050

60

70

80

90

100

Perfumes

FMCG

Consumer

Electronics

WhiteGoods

Financial

Services

Mobile

Utilities

Bulk

Chemicals

Source :Brand Finan


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Basics of Brand Score Card

Base

Branded

Business

Value

BBV

Sizeof the

Prize

BBV

Defined

The White

Space for

the brand

BVA driver 1

BVA driver 2

BVA driver 3

STEP 1

STEP 2

Add Volume

Add Pricing

Add Revenue

STEP 3


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Fundamentals

Branding is NOT advertising

It is a wrong concept that : More youadvertise more you would get response

Add a differentiating that could be fromPrice, Service or Image perspective

Do not ignore the power of PR,Promotion,Publicity and Sales


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"... if the circus is coming to town and you paint a signsaying 'Circus Coming to the Fairground Saturday', that'sadvertising. If you put the sign on the back of an

elephant

and walk it into town, that's promotion. If the elephantwalks through the mayor's flower bed, that's publicity.And if you get the mayor to laugh about it, that's publicrelations." If the town's citizens go the circus, you show

them the many entertainment booths, explain how muchfun they'll have spending money at the booths, answertheir questions and ultimately, they spend a lot at thecircus, that's sales.


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Identifying your key constituenciesfor brand building

1)Consumers (Average purchase, Frequency ofpurchase, Micro localization Index)

Irrespective of the business, customers aremost influential audience.

If the brand is not strong and positive in theeyes of current or prospective consumers, theywill not be purchasing your products or services.


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2) Employees (Brand Understanding, Pride ofassociation ,Referral willingness, Behaviour)

Their perspectives are particularly important inservice and retail industries as associates areincreasingly asked to play ambassadorial roles.

Many companies consider the entire associatepopulation to be "brand managers" as theydefine the ultimate customer brand experiencein their attitudes and actions


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3) Society (CSR, Contribution)

Is the brand considered to be a

good corporate citizen?Is it known as an active,

contributing member of the

community?


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4) Investors (Perception)

It is related to the short-term cost ofborrowing and also built into theinvestor's perspective is the quality

of management.Assist in premier company

valuation


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Illustration of valuation approach (Brand Finance)

= Total

+ Segment A

+ Segment B

1. Segmentation

2. Due diligence of

forecasts

Yr

4Yr

2

Yr

3

Future

Value

Discounted to present value

Future Cash Flows

Business

Value

Yr

1

3. Brand contributionto earnings4. Risk attached

to future earnings

Yr

5

Trademark

Value


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What is driving consumer value?

Importance

10 20 30 40 50 60

Size

Features

Availability

Design

Exclusivity

CompetitorsPerformance

10 20 30 40 50 60

Size

Features

Functional delivery

Availability

Design

Exclusivity

Image

Leadership

and understand how we perform against competition


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randetaScoring Template

Attribute Score

Time in market 0 -10

Distribution 0 -10

Market share 0 -10

Market position 0 -10Sales growth rate 0 -10

Price premium 0 -10

Elasticity of price 0 -10

Marketing spend/support 0 -10Advertising awareness 0 -10

Brand awareness 0 -10

TOTAL max 100


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Inter Techs 5 year performance

Performance (million) Base Year 1 2 3 4 5

Sales Revenue- Cost of goods sold

254135

293152

318167

387201

431224

454236

Gross Contribution- Manufacturing overhead

- Marketing & Sales- Research & Development

11948

1822

14158

2323

15163

2423

18682

2625

20790

2724

21895

2824

Net Profit 16 22 26 37 50 55

Return on Sales (%) 6.3% 7.5% 8.2% 9.6% 11.6% 12.1%

AssetsAssets (% of sales)

14156%

16255%

16753%

19450%

20548%

20645%

Return on Assets (%) 11.3% 13.5% 15.6% 19.1% 24.4% 26.7%


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Performance (million) Base Year 1 2 3 4 5

Market Growth 18.3% 23.4% 17.6% 34.4% 24.0% 17.9%

InterTechs 5 Year Market-Based Performance

Customer Retention (%)New Customers (%)% Dissatisfied Customers

88.2%11.7%13.6%

87.1%12.9%14.3%

85.0%14.9%16.1%

82.2%24.1%17.3%

80.9%22.5%18.9%

80.0%29.2%19.6%

InterTech Sales Growth (%)

Market Share(%)

12.8%

20.3%

17.4%

19.1%

11.2%

18.4%

27.1%

17.1%

16.5%

16.3%

10.9%

14.9%

Relative Product QualityRelative Service QualityRelative New Product Sales

+10%+0%+8%

+8%+0%+8%

+5%-20%+7%

+3%-3%+5%

+1%-5%+1%

0%-8%-4%

Why Market Growth Rates Are Important

A quick glance at Table 2, however shows that most market indicators are negative. It is obvious that, when market conditionsare less benign, this company will not last long.


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Brand Scorecard Framework

Market &Financial

Performance

BehaviourMarketingActions

Perceptions

Trial

Frequency

Loyalty

Awareness

Familiarity

Salience

Quality perceptions

Value perceptions

Image perceptions

Preference

Marketing Investment & Performance Scorecard

Brand equitymeasures

Activitymeasures

Behaviouralmeasures

Performance& Financialmeasures


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Marketing

Marketing is a social and managerial process throughwhich individuals and groups obtain what they need orwant through creating, offering and exchanging productof value with others

Needs- A human need is a state of deprivation of basicsatisfaction.

Wants-They are desires for specific satisfiers of needs.

DemandsThey are wants for specific product backedby willingness and ability to pay.

Product-A product is anything that can be offered tosatisfy a need or want.


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Product- A product can consist of as manyas three components: physical good(s),service (s), and idea (s).

Goods Services Idea

Fast food Hamburger purchasing saves timeRestaurant fries,drinks cooking,seating

Computer Monitor,printer delivery,installation computationtraining power

Church/Temple

Product is anything that can be offered to a market to satisfy awant or need.


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Five Competing Concept

The Production Concept

It Holds that consumers will favour those products thatare widely available and low in cost.Manager ofproductionoriented organisation concentrate on

achieving high production efficiency and widedistribution.

The Product Concept

It holds that consumers will favour those products thatoffers the most quality ,performance, or innovativefeatures: Managers in product oriented organisationsfocus their energy on makinghg superior products andimproving them over time.


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The Selling ConceptIt holds that consumers , if left alone , willordinarily not buy enough of the organisationsproducts.The organisation must therefore

undertake an aggressive selling and promotioneffort.

The Marketing ConceptIt holds that the key to achieving organisational

goals consist of being more effective thancompetitors in integrating marketing activitiestowards determining and satisfying the needsand wants of target markets.


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The Societal Marketing Concept-

It holds that the organisation task is todetermine the needs, wants , and interestsof target markets and to deliver thedesired satisfactions more effectively andefficiently than competitors in a way that

preserves or enhances the consumersand the societys well being.


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Five Product Level

Core benefit (Rest and Sleep)

Basic product (Bed,bathroom,towels,desketc)

Expected product (Clean bed,Freshtowels,working lamps,quietness.

Augmented product (Remote control tv

Sets,fresh flowers,rapid check ins) Potential product (Delighting customer, all

suites hotel, all women hotels etc)


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Product Hierarchy

Need family:The core need that underlies the existence of a productfamily.eg-Security.

Product family:All the product classes that can satisfy a core need withreasonable effectiveness.eg-savings and income

Product class:A group of products within the product family recognised ashaving a certain functional coherence. eg financial instruments

Product line: A group of items within a product class that are closely relatedbecause they perform a similar function, are sold to the same consumergroups, are marketed through the same channels , or fall within given priceranges.eg life insurance.

Product type: A group of items within a product linethat share one of severalpossible forms of the product. Eg:term life.

Brand: The name , associated with one or more items in the product line,

that is used to identify the source or character of the item(s)eg Prudential. Item:A distinct unit within a brand or product line that is distinguishable by

size, price appearance, or some other attribute. Eg Prudential renewableterm life insurance


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Product Classification

Durability and Tangibility(Nondurable,durable,services)

Consumer Goods Classification

(Convenience goods- Staple,Impulse andEmergency goods,ShoppingGoods,Speciality goods,unsought goods)

Industrial Goods Classification(Materials and parts,Capital items, andsupplies and business services)


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Product Mix Decision

A product Mix is the set of all products anditems that a particular seller offers for saleto buyers.

Product Mix Width

Product Line length

Depth

Consistency

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