university of washington emba program regional 20 “branding and designing the offer” instructor:...
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University of Washington EMBA ProgramRegional 20
“Branding and Designing the Offer”
Instructor: Elizabeth Stearns
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Brand Policy• Brand Definition
– A name for a product
• Brand Equity– A set of assets and liabilities linked to a brand
that add value provided by a product or service, to a firm and/or to that firm’s customers. (typically quantified on a $ metric)
• Brand Leveraging– Applying the firm’s equity in a brand to a new
product in an existing or new market
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RANK 2003 BY BRAND VALUE ($BILLIONS)
COCA-COLA 70.5 MICROSOFT 65.2IBM 51.8 GE 42.3 INTEL 31.1NOKIA 29.4DISNEY 28.0McDONALD'S 24.7MARLBORO 22.2MERCEDES 21.4
Business Week & Interbrand Corp.
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2003COCA-COLA 70.5 MICROSOFT 65.2IBM 51.8 GE 42.3 INTEL 31.1NOKIA 29.4DISNEY 28.0McDONALD'S 24.7MARLBORO 22.2MERCEDES 21.4
Business Week & Interbrand Corp.
RANK BY BRAND VALUE ($BILLIONS)
2001COCA-COLA 68.9 MICROSOFT 65.1IBM 52.8 GE 42.4 NOKIA 35.0INTEL 34.7DISNEY 32.6FORD 30.1McDONALD'S 25.3AT&T 22.8
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What is a Brand?
Attributes Benefits Values
Culture
User
Personality
©2000 Prentice Hall
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Aspects of Brand Equity
Loyalty
Name Awareness
Perceived QualitySatisfaction
Associationsand Image
ChannelRelationships
ChannelRelationships
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Brand Equity Maintenance
• Brand Equity Building Activities
– Advertising and public relations
– Service
– Product improvement
– Channel support
– Customer reward system
– Price maintenance
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Brand Equity Maintenance
• Brand Equity Exploiting Activities
– Price promotions/cutting
– Lower price component substitution
– Channel downscaling/proliferation
– Channel/supplier squeezing
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Selling WhoppersCAMPAIGN YEARS AGENCY“Burger King, home of the Whopper” 1958-68 Hume Smith Mickelberry
“The bigger the burger, the better the burger” 1968 Batten, Barton, Durstine,
“Have it your way” 1974 and Osborne
“America loves burgers and we’re America’s 1976 J. Walter Thompson
burger king”
“Best darn Burger” 1978
“Make it special, make it Burger King” 1979
“Aren’t you hungry” 1982
“Battle of the burgers” 1982
“Herb” 1985
“Burger King town” 1986
“Best food for fast times” 1987
“We do it like you do it” 1987-89 N.W. Ayer
“Sometimes you’ve gotta break the rules” 1989 D’arcy, Masius, Benton,
“Your way right away” 1991 and Bowles
“BK tee vee” 1992
“Back to basics” 1994 UniWorld Group
“Get your burger’s worth” 1994 Ammirata/Puris/Lintas
“It just tastes better” 1996
“When you have it your way it just tastes better”1999
“Got the urge?” 2000 Lowe/Lintas and partners
“The WHOPPER says:” 2001 McCann Erickson
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Think about who you are in the marketplace
• and what you “look” like to your customers, prospects, collaborators, competitors, and to yourself!
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Pacific Market Research
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Brands & Their Benefits
• Convey many levels of meaning
-attributes -benefits
-values -culture
-personality
For Consumers For Sellers
-Simplify shopping -Basis for differentiation
-Surrogate for quality -Foster Company Relationships
-Satisfy needs (e.g. status) -Represent the intangible
“A Brand is a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors”
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Product
• Definition: A product is anything that can be
offered to a market for acquisition, use or
consumption that might satisfy a need or want
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Product
• Products have a Range of Characteristics
Intangible“Pure”Service
Life Insurance
Tangible“Pure”Product
RoadSalt Most Things We Buy
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Key Product Decisions
• Attribute levels for individual products
• Product Mix– Breadth of line– Depth of line
• Branding Policy– Equity– Leveraging
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Key Product Decisions
• New Product Acquisition
– Internal development
– Other• acquisitions• joint ventures• licensing
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Product Mix
WidthWidth - number of different
product lines
WidthWidth - number of different
product lines
LengthLength - total number of itemswithin the lines
LengthLength - total number of itemswithin the lines
Depth Depth - number of versions of each product
Depth Depth - number of versions of each product
Product Mix - Product Mix - all the product
lines offered
Product Mix - Product Mix - all the product
lines offered
Co
nsi
sten
cy
©2000 Prentice Hall
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Branding Policy(Line Extension – “Rationale”)
• Adapt to consumer need, variety seeking • Update or expand core brand’s image• Increase sales quickly and “inexpensively” (reduced
advertising and sales costs)• Offer a broad range of price points and thereby serve a
wider audience of consumers• Low cost, low risk way to serve a highly segmented
market• Increase shelf space and thereby attract more
consumer/purchaser attention• Utilize excess capacity• Preempt competitors in shelfspace, mindspace
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Branding Policy(Line Extension – Risks)
• Diluting the core brand image - Ultimate loss in asset $$ value (eg Pierre Cardin)
• Blurring the rationale for each product in the line (P&G retrenchment)
• Encourages variety seeking (may not be yours!)• Under exploiting a good idea (so not available later)• Increasing costs without increasing overall sales• Reducing credibility with, and or angering the trade
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Two-Way Product-Line Stretch: Marriott Hotels
QualityEconomy SuperiorStandard Good
Pri
ceP
rice
High
Aboveaverage
Average
Low Fairfield Inn(Vacationers)
Courtyard(Salespeople)
Marriott(Middle
managers)
MarriottMarquis
(Topexecutives)
©2000 Prentice Hall
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Designing Offers for Customers
Offer
CostValue
PriceTimeEffortRisk
TechnicalInnovation
SalesRelation-ship
BrandEquity
Delivery Services
Product
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Brand Strategies(connecting the Brand to the Offer)
BrandExtension
New
Bra
nd
Nam
e
Product Category
LineExtension
Existing
Existing
MultibrandsNew NewBrands
©2000 Prentice Hall
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Sell the product
The Value-Delivery Process
Make the product
ProcureDesignproduct Make Price Sell Advertise/
promote Distribute Service
Choose the Value Provide the Value
Communicate the Value
(a) Traditional physical process sequence
(b) Value creation & delivery sequence
Strategic marketing Tactical marketing©2000 Prentice Hall
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Satisfaction =
Performance minus Expectations
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Thank you !