Strategic Brand Management
What is a brand ? •
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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 a group of sellers and to differentiate then from those of competitors. Therefore Therefore a Brand is essentially a sellers’ promise to consistently consistently deliver a set of features features , benefits and services to the buyer b uyers. s.
Difference between Product & Brand •
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In marketing, product is is anything that can be offered to the market that may satisfy the need, want, and demand of a certain individual or market. It is also called as goods or service. Product is more than just a material material object. On the other hand, brand is is a symbolic manifestation of all the information connected with a company, product, or service.
Note : A brand name can be used across several products… product lines … product categories
What is a brand?-What does it convey? A brand can convey up-to 6 levels of meaning: 1. Att ttrib ribut utes es -A bra brand nd fir first st brin brings gs to to mind mind cert certain ain pro produ duct ct attributes(advantages) 2. Benefi Benefitsts- Custo Customer merss do not buy at attri tribut butes, es, they they buy benefits.(benefits) 3. Values alues -A brand brand also also says says some someth thing ing about about the the pro produ ducer cerss & buyers' values. 4. Culture-The brand may represent a certain culture. The Mercedes represents German culture: organized, organ ized, efficient, high quality. quality. 5. Pers Person onali ality ty -A brand brand also also pro projec jects ts a per person sonali ality ty 6. User (association ) -The brand suggests the kind of consumer who buys or uses the product.
Note : Perhaps the most distinctive skill of professional professional marketers is their ability to : create create , maintain, Enhance & protect
brands !!!
Why Brand .. ? The purpose & significance significance Helps Buyers. Buyers. •
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Brand names tell the buyer something about product quality. Brand names also increase the shopper's efficiency. Brand names help call consumers' attention attention to new products that might benefit them. A story can be built around a brand.
Why Brand .. ? The purpose & significance significance Helps Suppliers: Systematize -The brand name makes it easier for the supplier to process orders and track down problems. Protection-The supplier's brand name and trademark provide legal protection for unique production features that otherwise might be copied by competitors. Build Loyalty-Branding enables the supplier to attract a loyal and profitable set of customers. •
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Why Brand .. ? The purpose & significance significance Helps consumers and society: Consistency in Quality- as a brand is a promise to consistently deliver quality. Increases innovation- for protection from competition which leads to a larger choice More & precise information -Branding helps shoppers because it provides much more information information about products and where to find them.
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Why Brand? ……. Why Not Brand..?
Benefits of product branding
“Image is everything” – Andre Agassi
Brand Image •
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The term "brand image" gained popularity as evidence began to grow that the feelings and images associated asso ciated with a brand were powerful purchase influencers, though brand recognition, recall and brand identity. It is based on the proposition that consumers consumers buy not only a product (commodity), but also the image associations of the product, such as power, wealth, sophistication, sophistication, and most importantly identification and association with other users of the brand. Brand images are usually evoked by asking consumers the first words/images that that come to their mind when a certain brand is mentioned
Brand identity •
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Brand identity stems from an organization, i.e., an organization organization is responsible for creating creating a distinguished product with unique characteristics.
Brand identity includes following elements Brand vision, brand culture, positioning, personality, relationships, and presentations
Brand identity •
Brand identity is a bundle of mental and functional associations with the brand. Associations are not “reasons-to-buy” but provide familiarity and differentiation that’s not replicable.
Brand Equity
The differential effect that brand knowledge has on consumer response to the marketing of that brand.
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Brand Equity •
refers to the marketing effects or Brand equity refers outcomes that accrue to a product with its brand name compared with those that would accrue if the same product did not have the brand name
Equity Measurement There are many ways to measure a brand: Firm Level : Firm level approaches measure the brand as a financial asset. Market capitalization capitalization - and then subtract subtract tangible assets and "measurable" intangible assets- the residual would be the brand equity. Product Level : The classic product level brand measurement example example is to compare the price of a noname or private private label product to an "equivalent" branded product. product. The difference difference in price, assuming all things equal, is due to the brand
Equity Measurement •
Consumer Level : This approach seeks to map the mind of the consumer to find out what associations with the brand the consumer has. This approach seeks to measure the awareness (recall (recall and recognition) and brand image (the overall associations that the brand has
Branding
Endowing products and services with the power power of a brand.
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Branding strategy strategy
Devising Branding strategy How to to brand brand a new product is essentially critical . There are 3 main choices : 1. It can can use use new new br brand and elem elemen ents ts for for the the new new product 2. It can can app apply ly exi exist stin ing g brand brand elem elemen ents ts 3. Combi Combina nati tion on of new new & exis existi ting ng elem elemen ents ts
Brand extension- one of the most common •
Brand extension – when a firm uses an established brand for the new product When the mark m arketer eter combines a new brand b rand with an existing brand , this sort of a brand extension can also be called as sub-brand as sub-brand
Brand extension
Brand extension
Line extension
Category extension
Brand extension They fall in 2 general categories : Line extension- the parent brand covers a new product within a product category, It currently serves , such as with new flavors , colors , sizes , ingredients etc. eg : HUL’s lifebuoy – has lifebuoy care , lifebuoy total / deofresh etc Category extension – the parent brand is used to enter a different category from the one it currently currently serves. serves. Eg: Honda has used its name in cars , motorbikes, marine engines etc. their ad ‘you can can fix six Hondas in 2 car garages’ garages’ … Tata….
Individual Names
Blanket family name Branding (strategy ) decisions Separate family names
Corporate name combined with individual product name
Branding ( Strategy) Decisions 1. Individual Names : P&G has several several individual brands in different product categories . Like Vicks(health care), Whisper( hygiene), Arial & tide ( Fabric care) Head & Shoulders & Pantene( Pantene( hair care). to the product if The company’s reputation is not tied to the product fails , it does not hurt the company image image or brand. Can be done for different products in different quality lines eg: Kingfisher acquired air Deccan & rebranded it as Simplify Deccan & retained Kingfishers brand equity Also called as ‘House of Brands’
Branding ( Strategy) Decisions •
Blanket family name : the blanket family name is used across product categories.eg; Tata Salt , Tata Tata Nano , Tata Tea etc
The development cost is low – no expenditure on
recognition recognition building Corporate image associations of innovativeness ,
trustworthiness, expertise can positively influence customer evaluation/decision Also called as “Branded House”
Branding ( Strategy) Decisions •
Separate family names for all products ; The Separate Aditya Birla group uses the name ‘Hindalco’ for aluminum: ‘Ultratech’ for cement ‘Grasim & Gravier Graviera a’ for suiting. Also Vedanta group – sesa goa etc
Each is building its own identity ( as against
image ) to establish itself in their th eir respective industries
Branding ( Strategy) Decisions •
Corporate name combined with individual Corporate product name: eg: Kellogg’s Rice Krispies : Kellogg’s corn flakes etc , also Sony & HP
Here although it is not a family brand – it has
high Brand identity that it can case-in on
Designing a Branding strategy •
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No. of levels of brand hierarchy Desired awareness & image at each hierarchy level
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Decide on which products are to be introduced
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Combining brand elements from different levels
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Linking brand elements to multiple products
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Developing an architecture
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Adjustments to the marketing Program
No. of levels of brand hierarchy •
Principle of simplicity – Employ as few levels as possible
Principle of clarity – Logic & relationship relationship of all brand elements employed must be obvious & transparent . Points of differentiation should be clear. clear. It could help in i. Retail interest generation ion ii. ii. Org Organiz anize e sel selling ling effort ort iii. iii. Cate Caterr to fragm fragmen ente ted d custom customer er segme segment ntss / taste tastess •
Desired awareness & image at each hierarchy level •
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Principle of relevance relevance – Create abstract associations that are relevant relevant across as many individual items as possible Principle of differentiation differentiation – Differential individual items & brands . Mostly in the case of individual brands
Decide on which products are to be introduced •
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Principle of growth – Invest in market penetration penetration or expansion v/s product development, depending on ROI opportunities Principle of survival- Brand extensions must achieve brand equity in their categories Principle of synergy synergy – brand extensions should increase the equity of the parent brand
Combining brand elements from different levels •
Principle of prominence prominence – The relative prominence of brand elements affect perceptions of product distance and the image created for the product .
Single entity- one product line offered . The
image of the product & entity is one.eg.Federal express Brand dominance – strategic decision not to relate brand and corporate name. eg. Philip Morris & Malboro
Combining brand elements from different levels Equal dominance – links brand name with
corporate name but build a distinct image eg. GM with its different car names – Buick LeSabre , Buick Electra: Also Westside etc Mixed Dominance – sometimes individual product names are dominant , sometimes the corporate name. eg. Bosch uses its corporate name on some products but not on some (like Blaupunkt). Also redwood hotels : ITC hotels etc Corporate dominance- corporate name is supreme & applied in all product lines. Eg. Xerox
Linking brand elements to multiple products
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Principle of commonality – The more common elements products share the stronger the link
Its best to use the brand element ‘as is’
Developing an architecture •
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Brand architecture architecture is the structure of brands within an entity . The way the brands in a company’s portfolio are related to, and differentiated from, one anothe anotherr. Brand architecture architecture may be defined as a s an integrated integrated process of brand building bu ilding through establishing brand relationships among branding options in the t he competitive environment
Developing an architecture •
In order to understand if the over-all architecture is good , the following questions need to be asked after carefully examining the brand portfolio & hierarchy-
Do our brands have defined roles ? Do brands collectively maximize coverage &
minimize overlap? For the hierarchy does any brand have extension
potential?.. Within or outside its category category ..
Adjustments to the marketing Program •
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Product design , pricing policies , distribution strategies strategies and marketing marketing & communication strategies/plans strategies/plans depend on the role role of the the brand and its independencies with other brands The broader the category-gap category-gap the great g reater er the independence
STRA ST RATEG TEGIES IES ACR ACROS OSS S P.L .L.C .C ST STAGE AGES S
PLC
PLC
PLC – for an Industry
Importance of PLC
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Modify , alter , adjust ,change - Strategies Strategies Time of entry of Fresh ( new ) product launches
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Need to extend – stretch life cycle
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Extend at which particular stage
Strategies through Life cycle stages Introduction stage •
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Rapid skimming strategy – the big-push method. High price , high promotional spends – largely when customer awareness is low & firm requires quick profits & potential competition is high Slow skimming – High price , low promotion – largely when potential customers are aware & willing to pay . pay . Also when potential potential competition is limited
Strategies through Life cycle stages Growth stage •
Maintain the price balance with w ith competitors competitors
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Expand network
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Increase product usage – multiple facilities
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Entry in newer pastures ( markets) markets)
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Advertising – aimed at product preference
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Sub-brand for a quicker market response
Strategies through Life cycle stages Maturity Stage •
High levels of product modification
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Carving niches
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Pruning product lines
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Repostioning
Strategies through Life cycle stages Decline Stage •
Dropping products if they do not make make economic sense
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Diverting business att attention ention on profitable ares
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Optimize investments
Brand Management - An Upper View What is Brand Equity – A discussion on Equity
Models Building Brand Equity – Choosing & Developing Brand elements Measuring Brand Equity – Brand Value Chain – A discussion on distinguishing ‘Brand Valuation’ from ‘Brand Equity’ Managing Brand Equity – Making Action to ‘Reinforce’ & ‘Revitalize’…. Positioning
Brand positioning •
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Brand positioning refers to “target consumer’s” reason to buy your brand in preference to others
In marketing, positioning has come to mean the process by which marketers try to create an image or identity in the minds of their target market for its product, brand, or organization
Positioning concepts There are three types of positioning concepts: Functional positions
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Symbolic positions – – – –
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Solve problems Provide benefits to customers Get favorable perception by investors (stock profile) and lenders Self-image enhancement Ego identification Belongingness and social meaningfulness Affective fulfillment
Experiential positions – –
Provide sensory stimulation Provide cognitive stimulation
NOTE: this is also called as Brand Concept Management (BCM)
Measuring the positioning •
Positioning is facilitated by a graphical technique called perceptual mapping, various survey techniques, and statistical statistical techniques like like multi dimensional dimensional scaling, factor factor analysis, conjoint analysis, and logit analysis.
Measuring the positioning- perceptual mapping •
Perceptual mapping is a graphics technique used by asset marketers that attempts attempts to visually display the perceptions of customers or potential customers. Typically the position of a product, product line, brand, or company is displayed relative to their competition. E.g car brands
perceptual perceptual mapping
brand diff differentiation erentiation •
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The concept of Brand differentiation has become very popular in the recent years. The brands want to remain differentiated from other brands and there are various ways they can achieve this aim. The brand differentiation is basically brought by positioning of brands. Positioning is the place which the brand makes in the minds of the customers or in market. Brand differentiation can also be achieved by unique selling position of the brand and for increasing the brand value and brand equity.
Differentiators •
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Price: Many brands attempt to Differentiate by being the lowest priced provider. This is seldom a good Differentiator because there's always someone else who will try competing with you on price Quality: When Quality alone is thought to be a Differentiator you are not on strong footing. Others can offer Quality as well. Also, Quality is hard to define Customer Service: Here is another attribute that has been adopted as a Differentia Differentiator tor which no longer has the same power it once did because almost everyone everyone is providing it to some extent or another.
Differentiators •
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Breadth of Line: Advertising that Lowes carries 24 brands of hammers does not motivate motivate people to switch from Home Depot. Breadth of Line can be a convenience but it won't Differentiate Leadership: This Differentiator must be earned. The Leadership role is bestowed by the market, and once the mantel is assumed, the brand can exploit its position. First in Category: By being the first to introduce a product in a new category, your brand is the leader unless you lose momentum Heritage: Serving a market market for a long time
Differentiators •
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Product Superiority: Although Quality may be a part of the superiority mix, it is usually performance that is claimed under Product Superiority. Brand "Owns" an Attribute: Ivory soap owns "It Floats". Volvo owns "Safety". Being the Newest: Here a brand will take the precarious route of eternal product development and introductions. A good example of a company that has excelled as an innovator is Intel. They seem always to be one step ahead, even obsoleting their own products to be the first with the fastes
Differentiating Differentiating strategies strategies •
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To avoid commodity commodity trap Competitive advantage : leverageable leverageable advantages – a company can use as a springboard to new n ew advantages The competitive advantage advantage should be seen as a customer advantage – e.g is speed is not a priority then it does not result in a customer advantage
Examples of differentiation •
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Nature’s basket by Godrej Agrovet ltd.- high end customers
Himalaya Drugs – ayurvedic ingrediences based on ancient traditional knowledge Swatch – color & youthful fashion
Brand Equity Models
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Brand Asset Valuator •
Aaker Model •
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BRANDZ
Brand Resonance
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Brand Asset Asset Valuator
Brand Asset Asset Valuator •
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Differentiation – degree to which a brand is seen as different from the rest Energy- Brands ability to meet future consumer needs & attract new customers. Relevance – size of the brand’s franchise , but not necessarily its profitability profitability Esteem- how well it is regarded & respected & liked Knowledge – How familiar & intimate consumers are with the brand
BAV
BAV BAV Power Grid
BrandZ •
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BrandZ is a brand equity database. It holds data from over 650,000 consumers and professionals professionals across 31 countries, comparing over 23,000 brands. The database is used to estimate brand valuations, and each year since 2006, has been used to generate a list of the top 100 global brands.[ According to BrandZ, "Brand value is the financial value of a brand defined as the sum of all earnings that a brand is expected to generate Marketing consultants Millward Brown & WPP have developed the BRANDZ model of Brand strength strength at the heart of it is the BrandDynamics BrandDynamics pyramid pyramid
Aaker’s Model (assets & liabilities )
Aaker’s Model Former UC-Berkeley ‘s Marketing professor David Aaker views brand equity as the brand awareness , brand loyalty & brand association association that combine to add to or subtract from the value provided by a product or service. He belives that a brand has a) core identity elements & b) extended identity elements Eg- Restaurant – “best in Fish food” – core identity element “ Informal environment & a relaxed lounge setting – extended elements •
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Brand Resonance
Brand Resonance
Brand Resonance •
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Brand salience - How often and how easily customers customers think of the brand under various purchase or consumption circumstances circumstances Brand performance – how much/well does a product or service meets m eets customers customers functional needs Brand imagery- how does d oes the brand attempt to meet customers psychological & social needs
Brand Resonance •
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Brand judgments – customers personal opinions & evaluations customer ’s emotional Brand feelings- are the customer’ responses and reactions in response to a brand. Brand Resonance – the relationship customers customers have with the brand – does the customer feel ‘in – sync’ with the brand. The objective is to create actively loyal customers.
Equity Valuation
