BA9251 BRAND MANAGEMENT LT P C3 0 0 3UNIT I INTRODUCTION 8Basics
Understanding of Brands Definitions - Branding Concepts Functions
of Brand - Significance of Brands Different Types of Brands Co
branding Store brands.UNIT II BRAND STRATEGIES 10Strategic Brand
Management process Building a strong brand Brand positioning
Establishing Brand values Brand vision Brand Elements Branding for
Global Markets Competing with foreign brands.UNIT III BRAND
COMMUNICATIONS 8Brand image Building Brand Loyalty programmes Brand
Promotion Methods Role of Brand ambassadors, celebraties On line
Brand Promotions..UNIT IV BRAND EXTENSION 9Brand Adoption Practices
Different type of brand extension Factors influencing Decision for
extension Re-branding and re-launching.UNIT V BRAND PERFORMANCE
10Measuring Brand Performance Brand Equity Management - Global
Branding strategies - Brand Audit Brand Equity Measurement Brand
Leverage -Role of Brand Managers Branding challenges &
opportunities Case Studies.TOTAL:45 PERIODSTEXT BOOKS1. Mathew,
Brand Management Text & cases, MacMillan, 2008.2. Kevin Lane
Keller, Strategic Brand Management: Building, Measuring and
Managing,Prentice Hall, 3rd Edition, 2007.REFERENCES1. Tyboust and
Kotter, Kellogg on Branding, Wiley, 20082. Lan Batey, Asain
Branding A Great way to fly, PHI, Singapore, 2002.
UNIT I INTRODUCTION 8Basics Understanding of Brands Definitions
- Branding Concepts Functions of Brand - Significance of Brands
Different Types of Brands Co branding Store brands.
IntroductionBranding is a process employed by business and
service organizations to create a unique identity and distinguished
image for their products and services. In a competitive business
world, there will be a good number of similar products offered by
various organizations. As a result, consumers will have wide choice
and they will be looking for information to make rational choices.
In view of this, marketers use differentiation strategy, to gain
the attention of the potential customer, and to create interest in
them to prefer their product. The communication strategy requires
brand support. It helps separate their product from the crowd of
me-too products and make a favorable impact on the target
customer.
Meaning and DefinitionIn the historical past, a way to tell one
persons cattle from another was by means of a hot iron stamp.
Accordingly, the practice of producers burning their mark (or
brand) onto their products continued giving rise to the use of the
word branding. The word brand is derived from the Old Norse brandr
meaning to burn.
To have better understanding of the word brand, we have to
consider it along with another related word- trade mark.
A brand is a Name, term, design, symbol, or any other feature
that identifies one sellers good or service as distinct from those
of other sellers.
A trademark is typically a name, word, phrase, logo, symbol,
design, image, or a combination of these elements used by an
individual, or business organization to identify that the product
or service belongs legally to them. In other words, Trademarks
serve to identify a particular business as the source of goods or
services.
A trademark may be designated by the following symbols:
TM(for an unregistered trademark, that is, a mark used to
promote or brand goods) SM(for an unregistered service mark, that
is, a mark used to promote or brand services) (for a registered
trademark) The owner of a registered trademark can challenge those
who copy it or use it as it is without his or her permission, in
the court of law. Legally, he or she can prevent unauthorized use
of that trademark and punish those who misuse it.
The American Marketing Association (AMA) defines a brand as a
name, term, sign, symbol or design, or a combination of them
intended to identify the goods and services of one seller or group
of sellers and to differentiate them from those of other
sellers.
The objectives that a good brand will achieve include:
Delivers the message clearly Confirms credibility of product or
company Connects target prospects emotionally with the product or
company Motivates the buyer to buy the product Concretes user
loyalty
History of BrandingThe Italians were among the first to use
brands, in the form of watermarks on paper in the 1200s. In the
field of mass-marketing, branding originated in the 19th century
with the advent of packaged goods. Factories put their logo or
insignia on the packages, extending the meaning of brand to that of
trademark. In the field of arts, even the signatures on paintings
of famous artists like Leonardo Da Vinci can be viewed as an early
branding tool.
Brands that became popularIt is the red triangle of the Bass
& Company, a British brewery, and the green and gold packaging
of Lyles Golden Syrup that have claims for being considered as the
worlds first trademarks.
Campbell soup, Coca-Cola, Juicy Fruit gum, Aunt Jemima, Uncle
Bens rice and Kelloggs breakfast cereal became popular famous among
consumer products.
Theoretical basesAround 1900, James Walter Thompson published a
house advertisement that provided commercial explanation of what we
now know as branding. Companies soon adopted slogans,mascots, and
jingles that began to appear on radio and television.
By the 1940s,manufacturers showed interest in knowing the
perceptions and attitudes of customers toward brands and this had
advanced the studies on brands and their relationship with
customers from social, psychological and anthropological
perspectives.
During 1980s, the modern branding practices appeared and
concepts like brand identity, brand personality, brand value and
brand equity, were employed to discuss branding effects.
The idea that consumers buy brands not only for products but
also for their own psychological and social reasons is well
promoted. Naomi Klein has described this development as brand
equity mania.
In 1988, for example, Philip Morris purchased Kraft for six
times what the company was worth on paper; the premium was paid for
the brand equity or value.Brand vs UnbrandIs branding necessary?
The answer is yes as well as no. Some companies sell their products
without branding. It is called commodity strategy. We will now
discuss the two strategies: commodity strategy and branding
strategy.
Commodity StrategyThe unbranded products are referred to as
commodities. Commodity describes products and services that posses
two features:
Highly standardized: The quality, size, shape and other defining
features of products are same.
Homogeneous: The differences between one product and another are
not significant.
Examples are food grains, vegetables, fruits, edible oil, sugar,
steel, and edibles. It is reported that as much as 75 per cent of
the coconut oil consumed in rural households is unbranded.
When sold as commodities, the marketer can differentiate them in
the following ways:
Grading: Those less familiar with the product cannot recognize
quality and the grade specifications help them to choose the
quality of their choice. Retailer image: Some consumers trust the
retailer and buy the goods recommended by him or her. The perceived
risk in buying the product available in different grades (also, the
fear of adulteration) is reduced by the brand promises. This is the
reason why consumers are shifting to branded goods.
Branding StrategyBranding can be a strategy when used to gain
the acceptance of consumers and secure a competitive edge. Let us
examine the arguments for and against it.
Branding Function:
1. It helps in product identification and gives
'distinctiveness' to the product. 2. Indirectly it denotes the
quality or standards of a product. 3. It eliminated imitation
products. 4. It ensures legal rights on the products. 5. It helps
in advertising and packaging activities. 6. It helps to create and
sustain brand loyalty to particular products. 7. It helps in price
differentiations of products.
Types of names:Functional Names: The lowest common denominator
of names, usually either named after a person, purely descriptive
of what the company or product does, or a pre- or suffixed
reference to functionality. (Dhara, Godrej, Bajaj)Invented Names:
"Invented" as in a made-up name (AIRTEL, GOOGLE, WIPRO) or a
non-English name that is not widely known.Experiential Names: A
direct connection to something real, a part of direct human
experience. Usually literal in nature, but presented with a touch
of imagination. (Netscape, Microsoft)Evocative Names: These names
are designed to evoke the positioning of a company or product
rather than the goods and services or the experience of those goods
and services. Removed from direct experience, but relevant evoking
memories, stories, and many levels of association. (Tanishq,
NIRMA)
Brand elements
Brands typically are made up of various elements, such as:
Name: The word or words used to identify a company, product,
service, or concept.
Logo: The visual trademark that identifies the brand.
Tagline or Catchphrase: "The Quicker Picker Upper" is associated
with Bounty paper towels.
Graphics: The dynamic ribbon is a trademarked part of
Coca-Cola's brand.
Shapes: The distinctive shapes of the Coca-Cola bottle and of
the Volkswagen Beetle are trademarked elements of those brands.
Colors: Owens-Corning is the only brand of fiberglass insulation
that can be pink.
Sounds: A unique tune or set of notes can denote a brand. NBC's
chimes are a famous example.
Scents: The rose-jasmine-musk scent of Chanel No. 5 is
trademarked.
Tastes: Kentucky Fried Chicken has trademarked its special
recipe of eleven herbs and spices for fried chicken.
Movements: Lamborghini has trademarked the upward motion of its
car doors.
Customer relationship management
Types of brand namesBrand names come in many styles. A few
include:Initialism: A name made of initials such, as UPS or
IBMDescriptive: Names that describe a product benefit or function,
such as Whole Foods, Airbus or Toys R' UsAlliteration and rhyme:
Names that are fun to say and stick in the mind, such as Reese's
Pieces or Dunkin' DonutsEvocative: Names that evoke a relevant
vivid image, such as Amazon or CrestNeologisms: Completely made-up
words, such as KodakForeign word: Adoption of a word from another
language, such as Volvo or SamsungFounders' names: Using the names
of real people, (especially a founder's name), such as
Hewlett-Packard, Dell, Disney, Stussy or MarsGeography: Many brands
are named for regions and landmarks, such as Cisco and Fuji
FilmPersonification: Many brands take their names from myths, such
as Nike; or from the minds of ad execs, such as Betty CrockerPunny:
Some brands create their name by using a silly pun, such as Lord of
the Fries, Wok on Water or Eggs Eggscetera
The Types of Brands
Different types of brands work for different marketing
approaches that your business might take. Basically, there are a
few general types of brands that your business could fall into:
Product brands: Products (commodities) become branded products
when you win awareness in the marketplace that your product has
compelling characteristics that make it different and better than
others in the product category.
Branding is a powerful tool that differentiates your offering in
ways that create consumer preference and allow you to command
premium pricing.
Service brands: Services are products that people buy
sight-unseen. People buy services purely based on their trust that
the person or business theyre buying from will deliver as promised.
If you sell a service or run a service business, you absolutely,
positively need to develop and manage a strong, positive brand
image.
Business brands: You can brand your business, itself, in
addition to or instead of branding your products or services.
If you can only build one brand and thats the best advice to any
business thats short on marketing expertise or dollars make it a
business brand because this brand can attract job applicants,
investors, and (maybe most importantly) customers.
Personal brands: Whether you know it or not, you have a personal
brand. If people know your name or recognize your face, they hold
your brand image in their minds.
Personality brands: Personality brands are personal brands gone
big-time. Theyre individual brands that are so large and strong
that they not only deliver wide-reaching personal celebrity but
also create significant value when associated with products or
services. Think Martha Stewart, Emeril Lagasse, or Oprah, and
you're on the right track. Sure, these are all just people, but
their names are associated with a superior quality and subject
expertise that speaks to their personality branding.
Co Branding:
Co-branding refers to several different marketing
arrangements:
Co-branding, also called brand partnership, is when two
companies form an alliance to work together, creating marketing
synergy. As described in Co-Branding: The Science of Alliance:
"the term 'co-branding' is relatively new to the business
vocabulary and is used to encompass a wide range of marketing
activity involving the use of two (and sometimes more) brands. Thus
co-branding could be considered to include sponsorships, where
Marlboro lends it name to Ferrari or accountants Ernst and Young
support the Monet exhibition."
Co-branding is an arrangement that associates a single product
or service with more than one brand name, or otherwise associates a
product with someone other than the principal producer. The typical
co-branding agreement involves two or more companies acting in
cooperation to associate any of various logos, color schemes, or
brand identifiers to a specific product that is contractually
designated for this purpose. The object for this is to combine the
strength of two brands, in order to increase the premium consumers
are willing to pay, make the product or service more resistant to
copying by private label manufacturers, or to combine the different
perceived properties associated with these brands with a single
product.
Store Brands:
Store brands are a line of products strategically branded by a
retailer within a single brand identity. They bear a similarity to
the concept of house brands, private label brands (PLBs) in the
United States, own brands in the UK, and home brands in Australia
and generic brands. They are distinct in that a store brand is
managed solely by the retailer for sale in only a specific chain of
store. The retailer will design the manufacturing, packaging and
marketing of the goods in order to build on the relationship
between the products and the store's customer base. Store-brand
goods are generally cheaper than national-brand goods, because the
retailer can optimize the production to suit consumer demand and
reduce advertising costs. Goods sold under a store brand are
subject to the same regulatory oversight as goods sold under a
national brand.
Store brand products encompass all merchandise sold under a
retail store's private label. That label can be the chain's own
name or a brand name created exclusively by the retailer for their
stores. In some cases, a store may belong to a wholesale buying
group that owns labels that are available to the members of the
group. These wholesaler-owned labels are referred to as controlled
labels.
Store brand items are offered in just about every food and
non-food grocery category: fresh, frozen and refrigerated food,
canned and dry foods, snacks, ethnic specialties, pet foods, health
and beauty care, over-the-counter drugs, cosmetics, household and
laundry products, lawn and garden chemicals, paints, hardware, auto
aftercare, stationery and house wares, among other sections of the
store.
Manufacturers of store brand products fall into four general
classifications: They are large national brand manufacturers that
utilize their expertise and excess plant capacity to supply store
brands. They are small, quality manufacturers that specialize in
particular product lines and concentrate on producing store brands
almost exclusively. Often these companies are owned by corporations
that also produce national brands. They are major retailers and
wholesalers that own their own manufacturing facilities and provide
store brand products for themselves. And they are also regional
brand manufacturers that produce private label products for
specific markets.
Arguments forProvides confidence to buyers: Consumers of all
types and areas are today aspiring for quality of life as a
consequence of the development schemes of government and NGOs. The
literate and illiterate, the urban and rural, men and women prefer
to buy branded products. Even the poor prefer branded shampoos and
hair oils sold in small volume sachets. To customers, brands
symbolize quality. They think the perceived risk in buying will be
lower.People are confident in buying brands like Lux, Lifebuoy,
Fair& Lovely, Horlicks, Boost, Bournvita, Parachute, Navaratna,
Sunsilk, Clinic plus, and Meera. Provides distinguishing identity:
A brand name gives identity to a companys product. It helps
recognition and processing jobs easy for the company, distributors
and consumers. It thus saves costs and time in manufacturing,
warehousing, transporting and order processing for the company when
selling. Distributors can reap similar benefits in handling the
products and selling them. Consumers find it easy to spot and
select the product. eople can distinguish Coca cola, Pepsi and
Thumsup. Though all of them are cola drinks, they differ in
packaging and taste.Image gives competitive advantage: Brands earn
recognition and reputation by their performance. The image helps
the existing products in the line as well as new products. It gives
a commanding position to the marketer to charge higher prices than
competitors and to convince distributors to carry the products.
Organisations interested in quality office furniture buy from
Godrej. Men interested in buying quality suits buy from Raymond.
Women interested in quality jewellery, buy from Tanishq.
Personality attracts consumers: Brands in course of their
association with consumers develop personalities. Advertisers take
this opportunity to match the personality of brands with that of
prospects. It helps build brand loyaltya lasting companionship, a
strong bondage between a brand and consumer. Marketers create a
personality for the brands they sell. Raymond talks about complete
man. Fair& Lovely presents woman as an achiever. Pleasure
scooty of Hero Honda asks why boys should have all the fun and
presents a liberated young girl.
Enhances value: By their popularity, brands not only enhance
their value-in-use but also value-in-exchange. A company that has
built brand image over a period of time by its incessant innovative
efforts gets a reward for example, premium price offer for its
brand from a competitor or interested entrepreneur willing to own
it. Allows buying inertia-In industrial markets, quality, price and
service are vital but in practice there is one over-riding issue
which is seldom mentioned as a reason for choosing a company - that
is because we have always bought from that company. Just consider
the number of years people in industry have used the same companies
as their main suppliers. It is not unusual for a supplier to have
been used for five, ten or even twenty years. Arguments
AgainstCategory competition: Most of the Indians are price
conscious. As such, the competition is more of categories rather
than brands. 70% of the population living in villages are less
literate and gullible. As such, branded products are not affordable
to many. The real competition is not among brands but categories.
Notion of high prices: The common notion prevalent among rural and
mid income consumers is branded products are high-priced ones. As
such, they shun brands. Investment-returns doubtful: Brand building
is not an easy task. It requires a great deal of long range
investment. It is to be supported by R & D investment,
advertising budget and dealer discounts. However, there is no
assurance of returns. Many brands have failed. Many are struggling
hard despite the good images they have built over a time. Image and
personality are emotional nonsense: All the talk about brand
personality and image are psychological fantasies created by
marketers. No product sells on brand name. Only when it fulfils a
need, does it stay and succeed in the market. The image of a
product or brand cannot help other brands. When a person buys the
product, the overriding considerations are cost (price and
operational economics) and functional benefits Brand equity is
sensible but not new: The brand equity concept replaces the old
term good will. It is not something new to be argued in favour of a
brand. It is the outcome of business built over a period. People
trust Tata companies, Godrej, Mafatlal etc., as they were operating
long since and offering reasonably good products. Customers prefer
to buy from a local retailer who is known and sometimes buy on his
or her recommendation.
Benefits of Branding
ConsumersManufacturers
Identification of sourceMeans of identification for handling or
tracing
Assignment of responsibilityLegal protection
Risk reducer functional, physical, financial, social,
psychological, and timeSignal of quality to consumers
Search cost reducerEndowing product with unique association
Promise, bond, or pactCompetitive advantage
Symbolic, culturalSource of financial return
Signal of quality
UNIT II BRAND STRATEGIES 10Strategic Brand Management process
Building a strong brand Brand positioning Establishing Brand values
Brand vision Brand Elements Branding for Global Markets Competing
with foreign brands.
Strategic Brand Management Process
The process of strategic brand management basically involves 4
steps:1. Identifying and establishing brand positioning.Brand
Positioning is defined as the act of designing the company's offer
and image so that it occupies a distinct and valued place in the
target consumer's mind.Key Concepts: Points of difference:
convinces consumers about the advantages and differences over the
competitors
Mental Map: visual depiction of the various associations linked
to the brand in the minds of the consumers
Core BrandAssociations: subset of associations i.e. both
benefits and attributes which best characterize the brand.
Brand Mantra: that is the brand essence or the core brand
promise also known as the Brand DNA.
2. Planning and Implementation of Brand Marketing ProgramsKey
Concepts: Choosing Brand Elements: Different brand elements here
are logos, images, packaging, symbols, slogans, etc. Since
different elements have different advantages, marketers prefer to
use different subsets and combinations of these elements.
Integrating the Brand into Marketing Activities and the Support
Marketing Program: Marketing programs and activities make the
biggest contributions and can create strong, favorable, and unique
brand associations in a variety of ways.
Leveraging Secondary Associations: Brands may be linked to
certain source factors such as countries, characters, sporting or
cultural events,etc. In essence, the marketer is borrowing or
leveraging some other associations for the brand to create some
associations of the brand's own and them to improve it's brand
equity.
3. Measuring and Interpreting Brand PerformanceKey Concepts:
Brand Audit: Is assessment of the source of equity of the brand and
to suggest ways to improve and leverage it.
Brand Value chain: Helps to better understand the financial
impacts of the brand marketing investments and expenditures.
Brand Equity Measurement System: Is a set of tools and
procedures using which marketers can take tactical decision in the
short and long run.
4. Growing and Sustaining Brand Equity:Key Concepts: Defining
the brand strategy: Captures the branding relationship between the
various products /services offered by the firm using the tools of
brand-product matrix, brand hierarchy and brand portfolio
Managing Brand Equity over time: Requires taking a long -term
view as well as a short term view of marketing decisions as they
will affect the success of future marketing programs.
Managing Brand Equity over Geographic boundaries, Market
segments andCultures: Marketers need to take into account
international factors, different types of consumersand the specific
knowledge about the experience and behaviors of the new geographies
ormarket segmentswhen expanding the brandoverseas or into new
market segments.
Strong Brand:In general, strong brands possess the following
personality attributes:
Trustworthy Authentic Reliable (I can always count on [brand]!)
Admirable Appealing Honest Likable Popular Unique Believable
Relevant Delivers high quality, well performing products and
services Service-oriente Building strong brand personality requires
special focus on packaging and advertising.
Packaging: Second major component of brand personality is the
packaging factor. It communicates much about brand personality e.g.
color association - Golden/Silver colors are used to represent
premium products.
Advertising The contents shown in the ads communicate a very
strong message that leaves a very strong and lasting impression in
customers minds. The elements like layout, colour etc (in print
ads) and visual appeal, music etc contribute to the brand
personality. Mozart symphony played in Titan advertisement
complements the brand personality of Titan as sophisticated,
elegant one.
Social MediaBrands are breaking the barriers and reaching
customers through social media. Customers are talking to brands and
exchanging their views. Today the customers say: I know what you
are doing brand.
In order to successfully give your brand a personality on Social
Media, consider these first:
What is your brand? What would you like your brand to be seen
as? Who would you like your brand to relate to the most?Once you
have considered the above, you can then choose to respond to your
consumers by keeping the following in mind
Voice-Choose the voice that you feel would fit your personality
the most. For example, if your brand wants to be seen as the
authority in your field and yet be accessible to consumers, keep
all social media interactions civil and regular. However if you
want to reach out to young people aged 16-25, you can adopt a
friendlier and easy-going stance by having an ongoing conversation
with them (always have an objective in mind while doing so).If you
are targeting young people, you can adopt aHey man! Thanks for the
compliment! tone. Politeness- Do note that just as the words Im
Sorry goes a long way in rebuilding your reputation when crisis
befalls, the words Thank You also go a long way in building up your
brand personality when a customer has something nice to say about
you on Social Media acknowledge compliments and thank them for
their graciousness!
Giving - Another good point to add would be that you would try
your best to continue giving your best to your customers.Brand
Positioning: The marketing activity and process of identifying a
market problem or opportunity, and developing a solution based on
market research, segmentation and supporting data. Positioning may
refer the position a business has chosen to carry out their
marketing and business objectives. Positioning relates to strategy,
in the specific or tactical development phases of carrying out an
objective to achieve a business' or organization's goals, such as
increasing sales volume, brand recognition, or reach in
advertisingBrand positioning processEffective Brand Positioning is
contingent upon identifying and communicating a brand's uniqueness,
differentiation and verifiable value. It is important to note that
"me too" brand positioning contradicts the notion of
differentiation and should be avoided at all costs. This type of
copycat brand positioning only works if the business offers its
solutions at a significant discount over the other
competitor(s).
Generally, the brand positioning process involves:
1. Identifying the business's direct competition (could include
players that offer your product/service amongst a larger portfolio
of solutions)
2. Understanding how each competitor is positioning their
business today (e.g. claiming to be the fastest, cheapest, largest,
the #1 provider, etc.)
3. Documenting the provider's own positioning as it exists today
(may not exist if startup business)
4. Comparing the company's positioning to its competitors' to
identify viable areas for differentiation
5. Developing a distinctive, differentiating and value-based
positioning concept
6. Creating a positioning statement with key messages and
customer value propositions to be used for communications
development across the organisation
Positioning conceptsMore generally, there are three types of
positioning concepts:
1. Functional positions
Solve problems
Provide benefits to customers
Get favorable perception by investors (stock profile) and
lenders
2. Symbolic positions
Self-image enhancement
Ego identification
Belongingness and social meaningfulness
Affective fulfillment
3. Experiential positions
Provide sensory stimulation
Provide cognitive stimulation
Brand elements
Brands typically are made up of various elements, such as
Name: The word or words used to identify a company, product,
service, or concept.
Logo: The visual trademark that identifies the brand.
Tagline or Catchphrase: "The Quicker Picker Upper" is associated
with Bounty paper towels.
Graphics: The dynamic ribbon is a trademarked part of
Coca-Cola's brand.
Shapes: The distinctive shapes of the Coca-Cola bottle and of
the Volkswagen Beetle are trademarked elements of those brands.
Colors: Owens-Corning is the only brand of fiberglass insulation
that can be pink.
Sounds: A unique tune or set of notes can denote a brand. NBC's
chimes are a famous example.
Scents: The rose-jasmine-musk scent of Chanel No. 5 is
trademarked.
Tastes: Kentucky Fried Chicken has trademarked its special
recipe of eleven herbs and spices for fried chicken.
Movements: Lamborghini has trademarked the upward motion of its
car doors.
Customer relationship management
Global Branding Marketers in India will catch up with the rest
of the world, and adopt a global mindset. The mantrathink global;
act local will be extended to brand global; market local. They seek
to evolve brands that would have universal trust, appeal and a
single-minded vision. Marketing programs that support the brands
will respect local culture and global fashions.
Building a global brand requires more than just launching a web
site that's accessible from almost anywhere in the world.
From language missteps to misunderstanding cultural norms,
veteran branding expert Barbara E. Kahn has seen it all when it
comes to the missteps of launching a brand across borders. Here,
she shares five tips to help entrepreneurs avoid the pitfalls.
Related:The Secrets of 7 Successful Brands1. Understand customer
behavior. Just because consumers have certain buying preferences or
habits in one culture, doesn't mean that such preferences are
universal. "It's astonishing how many retailers haven't made it
because they haven't studied how consumers shop," she says.
In her book, Global Brand Power(Wharton Digital Press, 2013),
Kahn cites Walmart's mistake in choosing locations in China that
were near industrial parks when consumers were used to shopping
closer to home instead of near work.
2. Position yourself properly. Good brand positioning includes
truly understanding your competition and then looking at your
competitive advantage. Who are the providers of similar products
and services that you sell in this country? They may not be the
same providers as in the U.S.
For example, if you sell athletic clothing, look at where people
are buying their athletic clothing. It could be from specialty
stores, online retailers, or sporting goods stores. If you have a
high-end brand and you're going into a market where the preferred
buying location is discount retailers, it may take a different
strategy from the one you use in the U.S. "You need to understand
how people shop and how your brand will fit into that mix," she
says.
3. Know how your brand translates.A clever brand or product name
in one language may translate into an embarrassing misstep in
another. For example, the French cheese brand Kiri changed its name
to Kibi in Iran because the former name means rotten or rank in
Farsi -- not exactly the association you want for cheese.
In addition to ensuring that your brand translates well into
other languages, consider which colors are favored in various
markets. In the U.S., blues and greens are favored, while reds and
yellows are frequently used in some Latin American countries and
may be appealing and familiar to audience members from those
areas.
4. Think broadly. Since your company may need to expand into
offering new products based on regional market demands, it's
important that your company name be broad enough to accommodate
those changes.
"Boston Chicken changed its name to Boston Market because it had
expanded into other foods," Kahn says. If your company name is
Brian's Computers for example, consider whether that will be
limiting in other markets if you also sell peripherals and
services, she says.
5. Find good partners. Work with your attorney to protect your
intellectual property overseas, filing the appropriate trademark
and patent protections in the U.S. and elsewhere, if applicable.
Find trade representatives who come recommended from colleagues or
state or federal trade offices, since they're more likely to be
reputable.
UNIT III BRAND COMMUNICATIONS 8Brand image Building Brand
Loyalty programmes Brand Promotion Methods Role of Brand
ambassadors, celebraties On line Brand Promotions.Brand Image:
The impression in the consumers' mind of a brand's total
personality (real and imaginary qualities and shortcomings). Brand
image is developed over time through advertising campaigns with a
consistent theme, and is authenticated through the consumers'
direct experience. See also corporate image.
Brand image is the current view of the customers about a brand.
It can be defined as a unique bundle of associations within the
minds of target customers. It signifies what the brand presently
stands for. It is a set of beliefs held about a specific brand. In
short, it is nothing but the consumers perception about the
product. It is the manner in which a specific brand is positioned
in the market. Brand image conveys emotional value and not just a
mental image. Brand image is nothing but an organizations
character. It is an accumulation of contact and observation by
people external to an organization. It should highlight an
organizations mission and vision to all. The main elements of
positive brand image are- unique logo reflecting organizations
image, slogan describing organizations business in brief and brand
identifier supporting the key values.
Brand image is the overall impression in consumers mind that is
formed from all sources. Consumers develop various associations
with the brand. Based on these associations, they form brand image.
An image is formed about the brand on the basis of subjective
perceptions of associations bundle that the consumers have about
the brand. Volvo is associated with safety. Toyota is associated
with reliability.
The idea behind brand image is that the consumer is not
purchasing just the product/service but also the image associated
with that product/service. Brand images should be positive, unique
and instant. Brand images can be strengthened using brand
communications like advertising, packaging, word of mouth
publicity, other promotional tools, etc.
Brand image develops and conveys the products character in a
unique manner different from its competitors image. The brand image
consists of various associations in consumers mind - attributes,
benefits and attributes. Brand attributes are the functional and
mental connections with the brand that the customers have. They can
be specific or conceptual. Benefits are the rationale for the
purchase decision. There are three types of benefits: Functional
benefits - what do you do better (than others ),emotional benefits
- how do you make me feel better (than others), and rational
benefits/support - why do I believe you(more than others). Brand
attributes are consumers overall assessment of a brand.
Brand Loyalty
In marketing, brand loyalty refers to a consumer's commitment to
repurchase or otherwise continue using a particular brand by
repeatedly buying a product or service.
The American Marketing Association defines brand loyalty as: 1.
) "The situation in which a consumer generally buys the same
manufacturer-originated product or service repeatedly over time
rather than buying from multiple suppliers within the category"
(sales promotion definition). 2. ) "The degree to which a consumer
consistently purchases the same brand within a product class"
(consumer behavior definition).
Aside from a consumer's ability to repurchase a brand, true
brand loyalty exists when a. ) the customer is committed to the
brand, and b. ) the customers have a high relative attitude toward
the brand, which is then exhibited through repurchase behavior. For
example, if Joe has brand loyalty to Company A, he will purchase
Company A's products even if Company B's products are cheaper
and/or of a higher quality.
Brand loyalty is viewed as a multidimensional construct,
determined by several distinct psychological processes, such as the
customers' perceived value, brand trust, satisfaction, repeat
purchase behavior, and commitment. Commitment and repeated purchase
behavior are considered as necessary conditions for brand loyalty,
followed by perceived value, satisfaction, and brand trust.
Philip Kotler defines four customer-types that exhibit similar
patterns of behavior:
a) Hardcore Loyals, who buy the brand all the time
b) Split Loyals, loyal to two or three brands
c) Shifting Loyals, moving from one brand to another
d) Switchers, with no loyalty (possibly "deal-prone," constantly
looking for bargains, or "vanity prone," looking for something
different).
Benefits of Brand Loyalty
The benefits of brand loyalty are longer tenure (or staying a
customer for longer), and lower sensitivity to price. Recent
research found evidence that longer-term customers were indeed less
sensitive to price increases.
According to Andrew Ehrenberg, consumers buy "portfolios of
brands. " They switch regularly between brands, often because they
simply want a change. Thus, "brand penetration" or "brand share"
reflects only a statistical chance that the majority of customers
will buy that brand next time as part of a portfolio of brands. It
does not guarantee that they will stay loyal.
By creating promotions and loyalty programs that encourage the
consumer to take some sort of action, companies are building brand
loyalty by offering more than just an advertisement. Offering
incentives like big prizes creates an environment in which
customers see the advertiser as more than just the advertiser.
Individuals are far more likely to come back to a company that uses
interesting promotions or loyalty programs than a company with a
static message of "buy our brand because we're the best. "
Popular Loyalty Programs
Below are some of the most popular Loyalty Programs that are
currently being used by major companies as a means of engaging
their customers beyond traditional advertising.
Sweepstakes and Advergames
Branded digital games that engage consumers with prize
incentives
Contests
Skill tests and user-generated promotions such as video and
photo contests
Social Media Applications and Management
Develop promotions and offers within social media channels
Ongoing management and maintenance of brand Facebook pages and
other social media
Customer Rewards Programs
Online points programs earn prizes for incremental purchase
behavior (e.g., JetBlue's TrueBlue and American Airlines's
AAdvantage frequet flyer programs)
My Coke Rewards, Pepsi Stuff, and the Marriott Rewards loyalty
programs
Promotional auctions bid for prizes with points earned from
incremental purchase behavior
Brand PromotionBrand promotion is a common marketing strategy
intended to increase product awareness, customer loyalty,
competitiveness, sales and overall company value. Businesses use it
not only to show what is different or good about themselves and
what's for sale, but also to keep that image alive for consumers.
It usually focuses on elements that can stand the test of time,
although businesses do adjust promotions based on what is happening
in the market. The efforts required to be effective with these
techniques require that marketers be passionate about what they're
doing.
Objectives of Brand promotionThe main objectives of brand
promotion are :
(i) To Promote Information: The firm provides the relevant
information about its various brands offered in the market.
Information relates to features, prices, special schemes, etc. of
the brands.
(ii) To Differentiate the Product: Another main objective of
brand promotion is 'brand differentiation' which means convincing
the customers about the unmatchable features or merits of the
particular brand. For example, Pepsi differentiates its brand by
using the slogan "The choice of a new generation". Such
differentiation helps to create 'Brand Loyalty' which means
consumers are faithful to and continue to prefer a particular
brand, e.g., Lux soap.
(iii) To Increase Demand: Brand promotion efforts aim at
stimulating demand for a product. They persuade customers to buy
more and more of the product so as to increase its sales and market
share.
(iv) To Build Brand Equity: Brand equity means the power and
value that a brand adds to a product. The utility of the brand is
emphasized. Status oriented advertisements highlight the value of
the brand and pride in its ownership. For example, utility of
owning a Mercedes Benz car or LG air conditioner.
(v) To Stabilize Sales: Seasonal, cyclical and other
fluctuations in demand affect sales. Brand promotion efforts seek
to stabilize sales by minimizing the impact of such fluctuations.
For example, Nescafe promoted its new brand of 'iced coffee' to
increase sales during summer.
(vi) To Offset Competitors' Marketing Efforts: In a highly
competitive market, even a well-established brand has to be
promoted to retain market share. For example, Coca Cola and Pepsi
keep on repeating their advertisements for their own brands of soft
drinks so as to offset each other's efforts.
(vii) To Build Image: Brand promotion is also aimed at creating
a positive image of the company offering its brands in the market.
A company can build its prestige and goodwill by offering quality
brands at reasonable prices and through satisfactory after-sale
service
Methods of Brand Promotion:
Create a brand image, or logo. Widespread brand recognition is
your goal, as it will give your business credibility and inspire
others to spread the word about your business. Grow your brand by
placing your logo in your business stationary, business cards,
email signatures, brochures, signs, website and merchandising
materials.Network. Meeting professionals from other, related
businesses is an effective form of business promotion, as it
provides you with opportunities to learn about your competitors,
ask for referrals, form mutually beneficial partnerships in
complementary industries and spread awareness about your business
throughout a group of like-minded people. Network with other
professionals in the following ways:
Attend networking group meetings. You can find networking groups
and clubs on the Internet, in newspapers and in trade
publications.
Introduce yourself to people at the meetings. Explain what it is
your business does, what you offer that makes you stand out from
your competition and what you are looking for in business
relationships.
Ask relevant questions during group discussions. In addition to
promoting your business, you can learn a lot at networking
meetings. Additionally, asking open-ended questions encourages
others to participate in the conversation, and sets you up for more
introductions.
Advertise. Consider these methods for advertising your business:
Signs. You may opt for storefront signs, billboards, marquee boards
or street-side yard signs.
Print. Place print ads in magazines, newspapers, coupon books,
trade journals and industry magazines. Choose print mediums that
are suited to your business. For example, if you run a technology
parts recycling warehouse, then you may consider placing ads in
computer classifieds and technology magazines.
Commercials. Television and radio commercials are effective ways
to promote your business to a broad audience, but they are
relatively costly forms of advertising.
Build business partnerships with other organizations. In effect,
piggyback off the success of another business. Taco Bell has
recently unveiled the Doritos Locos Taco, which is a branding coup
for both Taco Bell and Doritos. Whenever you think of one brand,
the other brand comes to mind, and vice-versa. Business
partnerships can be very effective advertising tools.
Rely on the power of social networks. Social networks have
become the new darling of advertising because much of the legwork
is being done by dedicated fans, for free. You could pay someone to
advertise for you, or you could establish a social community of
fans who advertise by word of mouth, at little or no cost. What's
it going to be?
Offer freebies. Pass out merchandise with your company's name
and/or logo on it to everyone you meet at networking events, trade
shows, client meetings and even personal social gatherings. Things
like pens, magnets and calendars are good merchandising ideas, as
these tend to stay in use, and within view, for extensive periods
of time.Develop relationships with your customers. Customers are
people not numbers and it is important that you put consideration
and effort into building personal relationships with them. For
example, when you send out Christmas cards each year, you not only
gain customer loyalty but you also inspire customers to promote
your business to the people they know.\Brand AmbassadorBrand
ambassador is a marketing term for a person employed by an
organization or company to promote its products or services within
the activity known as branding. The brand ambassador is meant to
embody the corporate identity in appearance, demeanor, values and
ethics.[1] The key element of brand ambassadors lies in their
ability to use promotional strategies that will strengthen the
customer-product/service relationship and influence a large
audience to buy and consume more. Predominantly, a brand ambassador
is known as a positive spokesperson appointed as an internal or
external agent to boost product/service sales and create brand
awareness. Today, brand ambassador as a term has expanded beyond
celebrity branding to self branding or personal brand management.
Professional figures such as good-will and non-profit ambassadors,
promotional models, testimonials and brand advocates have formed as
an extension of the same concept, taking into account the
requirements of every companyCelebrity branding is a type of
branding, or advertising, in which a celebrity becomes a brand
ambassador and uses his or her status in society to promote a
product, service or charity, and sometimes also appears as a
promotional model.Celebrity branding can take several different
forms, from a celebrity simply appearing in advertisements for a
product, service or charity, to a celebrity attending PR events,
creating his or her own line of products or services, or using his
or her name as a brand. The most popular forms of celebrity brand
lines are for clothing and fragrances. Many singers, models and
film stars now have at least one licensed product or service which
bears their name.
Celebrities often provide voice-overs for advertising. Some
celebrities have distinct voices which are recognizable even when
they are not visible on-screen. This is a more subtle way to add
celebrity branding to a product or service. An example of such an
advertising campaign is Sean Connery's voice-over for Level 3
Communications.
The use of a celebrity or sports professional can have a huge
impact on a brand. For example, sales of Nike golf apparel and
footwear doubled after Tiger Woods was signed up on a sponsorship
deal.More recently, advertisers have begun attempting to quantify
and qualify the use of celebrities in their marketing campaigns by
evaluating their awareness, appeal, and relevance to a brand's
image and the celebrity's influence on consumer buying
behavior.
Celebrity branding is a global phenomenon and it assumes
paramount importance in countries like India, where celebrities are
given the status of demi Gods by the masses. There is a certain
correlation between successful celebrity branding and brand
endorsements.
Online Brand Promotion
EmailEmail marketing is still one of the most effective way of
communicating with your customers or potential customers online if
you have them in your database. A best practice is to divide your
database into segments, for example: not likely to make a purchase,
likely to purchase, recently purchased, purchased in the past.
Tailor your messaging appropriately to your database and use all
the data tracked by modern cloud email clients like MailChimp,
Constant Contact, and Campaign Monitor to your advantage. Dont be
afraid to get creative because in the time of automated nurturing,
only the most relevant and attention-grabbing (in good taste) stand
out.
Forums/Review SitesTheres a forum for that. Chances are there
are people talking about products like yours on many of the review
deal sites or forums online today. The best way to find relevant
reviews is to do a quick search for [your product category] forum
or [your brand] review. Also be sure to check out generic
discussion pavillions like LinkedIn, Amazon, and Quora.
Responding to a forum post (especially a negative one) in a
professional and helpful manner will make your brand look
responsible and might even help drive traffic to your site. No
brand will please all of its customers, but the ones that stand out
go the extra mile to unruffle the feathers of unsatisfied customers
and leave a great impression.
Social media/BlogsFinding the right mix of content has long been
a challenging art to master and recently, it has been trending
science. Coined by Joe Pulizzi of the Content Marketing Institute,
the 4-1-1 rule is a good rule of thumb to use in social media:
Every 6 pieces of content should be made up of 4 pieces of new
content, 1 recycled piece, and 1 self-promotional piece.
A great way to begin to ramp up your social media presence is by
simply sharing and socializing more often and in more places. Join
and be active in relevant groups. Your followers will come as you
become more integrated in communities.
Banner ads and remarketingYouve probably seen the banner ads of
many sites youve visited recently on sites that carry top and/or
sidebar ad spaces. Banner ads are an effective way to stay top of
mind of your customers and drive remarketing traffic to your page.
Again, the theme here is relevancy. An awesome way to stand out is
to use the cookie information of specific pages your customers have
visited and display the corresponding product they were browsing
right there in the banner ad. When used knowledgeably, banner ads
can yield tremendous ROI.
UNIT IV BRAND EXTENSION 9Brand Adoption Practices Different type
of brand extension Factors influencing Decision for extension
Re-branding and re-launchingAdoption:
Five-stage mental process all prospective customers go through
from learning of a new product to becoming loyal customers or
rejecting it. These stages are (1) Awareness: prospects come to
know about a product but lack sufficient information about it; (2)
Interest: they try to get more information; (3) Evaluation: they
consider whether the product is beneficial; (4) Trial: they make
the first purchase to determine its worth or usefulness; (5)
Adoption/Rejection: they decide to adopt it, or look for something
else. Another explanation is that the customer moves from a
cognitive state (being aware and informed) to the emotional state
(liking and preference) and finally to the behavioral or conative
state
Adoption Process
It is a cognitive process through which all the consumers pass
before actually purchasing the product. It is divided into 5
stages:
a. Awareness:When the potential consumers are apprised of the
product but do not have a detailed knowledge about it.
b. Interest:When the product catches the consumers attention and
she herself tries to discover more and more about it.
c. Evaluation:In this stage, the consumer has enough knowledge
about the product and she considers its relative benefits and
evaluates it in terms of various factors as cost, aesthetics,
competitors offering, etc.
d. Trial:This is the stage when the consumer experiences the
product and judges whether the claims are correct or not. Trials
can be generated by sampling or by the consumer herself buying the
product. Many new brands aim to reach this stage as soon as
possible.
e. Adoption or Rejection decision:This is the stage when the
consumer has made up her mind whether to remain with the product or
switch back to her earlier product.
Brand Extension:Brand extension or brand stretching is a
marketing strategy in which a firm marketing a product with a
well-developed image uses the same brand name in a different
product category. The new product is called a spin-off.
Organizations use this strategy to increase and leverage brand
equity (definition: the net worth and long-term sustainability just
from the renowned name). An example of a brand extension is
Jello-gelatin creating Jello pudding pops. It increases awareness
of the brand name and increases profitability from offerings in
more than one product category.
A brand's "extendibility" depends on how strong consumer's
associations are to the brand's values and goals. Ralph Lauren's
Polo brand successfully extended from clothing to home furnishings
such as bedding and towels. Both clothing and bedding are made of
linen and fulfill a similar consumer function of comfort and
hominess. Arm & Hammer leveraged its brand equity from basic
baking soda into the oral care and laundry care categories. By
emphasizing its key attributes, the cleaning and deodorizing
properties of its core product, Arm & Hammer was able to
leverage those attributes into new categories with success. Another
example is Virgin Group, which was initially a record label that
has extended its brand successfully many times; from transportation
(aeroplanes, trains) to games stores and video stores such a Virgin
Megastores.
In the 1990s, 81 percent of new products used brand extension to
introduce new brands and to create sales. Launching a new product
is not only time-consuming but also needs a big budget to create
brand awareness and to promote a product's benefits. Brand
extension is one of the new product development strategies which
can reduce financial risk by using the parent brand name to enhance
consumers' perception due to the core brand equity.
Types of brand extensionBrand extension research mainly focuses
on consumer evaluation of extension and attitude toward the parent
brand. In their 1990 model, Aaker and Keller provide a sufficient
depth and breadth proposition to examine consumer behaviour and a
conceptual framework. The authors use three dimensions to measure
the fit of extension. First, the Complement refers to consumers
taking two product classes (extension and parent brand product) as
complementary in satisfying their specific needs.[10] Secondly, the
Substitute indicates two products have the same user situation and
satisfy the same needs, which means the product classes are very
similar and that the products can act to replace each other.
Lastly, the Transfer describes the relationship between extension
product and manufacturer which reflects the perceived ability of
any firm operating in the first product class to make a product in
the second class The first two measures focus on the consumers
demand and the last one focuses on the firms perceived ability.
From the line extension to brand extension, however, there are
many different types of extension such as "brand alliance",[12]
co-branding[13]
HYPERLINK "http://en.wikipedia.org/wiki/Brand_extension" \l
"cite_note-14" [14] or brand franchise extension. Tauber (1988)
suggests seven strategies to identify extension cases such as
product with parent brands benefit, same product with different
price or quality, etc. In his suggestion, it can be classified into
two category of extension; extension of product-related association
and non-product related association. Another form of brand
extension is a licensed brand extension. In this scenario, the
brand-owner works with a partner (sometimes a competitor), who
takes on the responsibility of manufacturing and sales of the new
products, paying a royalty every time a product is sold.
Types of Brand ExtensionsA brand name can be extended in three
ways:
1. Extended to other items in the same product lineSunrise
coffee was extended to other Sunrise Premium and Sunrise Extra
coffee catering to different segments. This is called line
extension. All are products in the same line-coffee.
2. Extended to items in a related product lineMaggi initially
was a brand of noodles. Later, the brand name was Extended to other
product lines in the related category food-Maggi Ketchup, Maggi
Soup, etc. It is a case food items. This is called related brand
extension or category extension.
3. Extended to items in an unrelated product line
The brand name Enfield, initially used for motorcycles, was
later Extended to television and gensets. Here, the products belong
to different and unrelated categories. It is a case of unrelated
brand extension, or outside the category extension.
2. Extending a Brand name to products in a related line
(Category extension) Here, the brand name is extended over
different products, but the products are related in some way. In
order words, they belong to a category. The Maggie example cited
earlier fits this description. Dettol can be cited as another
example.
Dettol :For years, Dettol has been a well known brand of
Antiseptic lotion. When the company, Reckitt & Colman, decided
to expand into new antiseptic products, they decided to launch them
under the Dettol brand name, i.e., as brand extensions in related
category. They felt that it would enable the new products to gain
immediate identification as sister products of Dettol and they
would easily move under the Dettol name. The Dettol brand name was
extended to number of related products as shown below:
Dettol soap Antiseptic Soap
Dettol Plaster Antiseptic Bandage
Dettol Hand wash Antiseptic Wash
3. Extending a Brand Name to Products in an unrelated line
(Outside category extension) : Here, the Brand Name is extended
across completely new and unrelated products, falling under all
together different product categories. It is here that brand
extension is put to the severest test and the value of the brand is
leveraged to the maximum. In other words, it is when a brand name
is extended to products in unrelated lines that the reward, as well
as the risk, is the maximum. The reward arises from the substantial
savings in the cost and time involved in developing and all
together new brand. We will understand this dimension when we
analyses the basic condition for success of brand extensions.
ReBrandingRebranding is a marketing strategy in which a new
name, term, symbol, design, or combination thereof is created for
an established brand with the intention of developing a new,
differentiated identity in the minds of consumers, investors, and
competitors.[1]
HYPERLINK "http://en.wikipedia.org/wiki/Rebranding" \l
"cite_note-2" [2] Often, this involves radical changes to a brand's
logo, name, image, marketing strategy, and advertising themes. Such
changes typically aim to reposition the brand/company, occasionally
to distance itself from negative connotations of the previous
branding, or to move the brand upmarket; they may also communicate
a new message a new board of directors wishes to communicate.
Rebranding can be applied to new products, mature products, or
even products still in development.
Product rebrandingAs for product offerings, when they are
marketed separately to several target markets this is called market
segmentation. When part of a market segmentation strategy involves
offering significantly different products in each market, this is
called product differentiation. This market segmentation/product
differentiation process can be thought of as a form of rebranding.
What distinguishes it from other forms of rebranding is that the
process does not entail the elimination of the original brand
image. Dexxa computer mice are rebranded Logitech devices sold at a
lower price by Logitech in the low-end market segment without
undercutting their mid-range products. Rebranding in this manner
allows one set of engineering and QA to be used to create multiple
products with minimal modifications and additional expense.
UNIT V BRAND PERFORMANCE 10Measuring Brand Performance Brand
Equity Management - Global Branding strategies - Brand Audit Brand
Equity Measurement Brand Leverage -Role of Brand Managers Branding
challenges & opportunities Case Studies.
Brand Equity
Brand equity is a phrase used in the marketing industry which
describes the value of having a well-known brand name, based on the
idea that the owner of a well-known brand name can generate more
money from products with that brand name than from products with a
less well known name, as consumers believe that a product with a
well-known name is better than products with less well-known
names.
Some marketing researchers have concluded that brands are one of
the most valuable assets a company has,[5] as brand equity is one
of the factors which can increase the financial value of a brand to
the brand owner, although not the only one. Elements that can be
included in the valuation of brand equity include (but not limited
to): changing market share, profit margins, consumer recognition of
logos and other visual elements, brand language associations made
by consumers, consumers' perceptions of quality and other relevant
brand values.
Consumers' knowledge about a brand also governs how
manufacturers and advertisers market the brand.[7]
HYPERLINK "http://en.wikipedia.org/wiki/Brand_equity" \l
"cite_note-8" [8] Brand equity is created through strategic
investments in communication channels and market education and
appreciates through economic growth in profit margins, market
share, prestige value, and critical associations. Generally, these
strategic investments appreciate over time to deliver a return on
investment. This is directly related to marketing ROI. Brand equity
can also appreciate without strategic direction. A Stockholm
University study in 2011 documents the case of Jerusalem's city
brand. The city organically developed a brand, which experienced
tremendous brand equity appreciation over the course of centuries
through non-strategic activities. A booming tourism industry in
Jerusalem has been the most evident indicator of a strong ROI.
Brand equity is strategically crucial, but famously difficult to
quantify. Many experts have developed tools to analyze this asset,
but there is no universally accepted way to measure it. As one of
the serial challenges that marketing professionals and academics
find with the concept of brand equity, the disconnect between
quantitative and qualitative equity values is difficult to
reconcile. Quantitative brand equity includes numerical values such
as profit margins and market share, but fails to capture
qualitative elements such as prestige and associations of interest.
Overall, most marketing practitioners take a more qualitative
approach to brand equity because of this challenge
ConstructionThere are many ways to measure a brand. Some
measurements approaches are at the firm level, some at the product
level, and still others are at the consumer level.
Firm Level: Firm level approaches measure the brand as a
financial asset. In short, a calculation is made regarding how much
the brand is worth as an intangible asset. For example, if you were
to take the value of the firm, as derived by its market
capitalizationand then subtract tangible assets and "measurable"
intangible assetsthe residual would be the brand equity.[5] One
high-profile firm level approach is by the consulting firm
Interbrand. To do its calculation, Interbrand estimates brand value
on the basis of projected profits discounted to a present value.
The discount rate is a subjective rate determined by Interbrand and
Wall Street equity specialists and reflects the risk profile,
market leadership, stability and global reach of the brand.[12]
Brand valuation modeling is closely related to brand equity, and a
number of models and approaches have been developed by different
consultancies. Brand valuation models typically combine a brand
equity measure (e.g.: the proportion of sales contributed by
"brand") with commercial metrics such as margin or economic
profit.
Product Level: The classic product level brand measurement
example is to compare the price of a no-name or private label
product to an "equivalent" branded product. The difference in
price, assuming all things equal, is due to the brand.[13] More
recently a revenue premium approach has been advocated.[4]
Marketing mix modeling can isolate "base" and "incremental" sales,
and it is sometimes argued that base sales approximate to a measure
of brand equity. More sophisticated marketing mix models have a
floating base that can capture changes in underlying brand equity
for a product over time.
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 and
recognition) and brand image (the overall associations that the
brand has). Free association tests and projective techniques are
commonly used to uncover the tangible and intangible attributes,
attitudes, and intentions about a brand. Brands with high levels of
awareness and strong, favorable and unique associations are high
equity brands.
All of these calculations are, at best, approximations. A more
complete understanding of the brand can occur if multiple measures
are used.
Positive brand equity vs. negative brand equity
Brand equity is the positive effect of the brand on the
difference between the prices that the consumer accepts to pay when
the brand known compared to the value of the benefit received.
There are two schools of thought regarding the existence of
negative brand equity. One perspective states brand equity cannot
be negative, hypothesizing only positive brand equity is created by
marketing activities such as advertising, PR, and promotion. A
second perspective is that negative equity can exist, due to
catastrophic events to the brand, such as a wide product recall or
continued negative press attention (Blackwater or Halliburton, for
example).
Colloquially, the term "negative brand equity" may be used to
describe a product or service where a brand has a negligible effect
on a product level when compared to a no-name or private label
product.
Family branding vs. individual branding strategies
The greater a company's brand equity, the greater the
probability that the company will use a family branding strategy
rather than an individual branding strategy. This is because family
branding allows them to leverage the equity accumulated in the core
brand. Aspects of brand equity include: brand loyalty, awareness,
association[14] and perception of quality.
Examples
In the early 2000s in North America, the Ford Motor Company made
a strategic decision to brand all new or redesigned cars with names
starting with "F." This aligned with the previous tradition of
naming all sport utility vehicles since the Ford Explorer with the
letter "E." The Toronto Star quoted an analyst who warned that
changing the name of the well known Windstar to the Freestar would
cause confusion and discard brand equity built up, while a
marketing manager believed that a name change would highlight the
new redesign. The aging Taurus, which became one of the most
significant cars in American auto history, would be abandoned in
favor of three entirely new names, all starting with "F," the Five
Hundred, Freestar, and Fusion. By 2007, the Freestar was
discontinued without a replacement. The Five Hundred name was
thrown out and Taurus was brought back for the next generation of
that car in a surprise move by Alan Mulally.
In practice, brand equity is difficult to measure. Because
brands are crucial assets, however, both marketers and academic
researchers have devised means to contemplate their value.[10] Some
of these techniques are described below.
Global Marketing Strategies: 1 Build a strong, consistent brand
cultureIn the past, a rigid corporate structure was an important
element of the global brand. Local markets were in charge of
developing their own brand strategies.
However, in recent years building a consistent and strong brand
culture that remains familiar to consumers wherever it is in the
world has become a priority. Tony Effik, chief strategy officer at
Publicis Modem, explains: A brand needs a single view of the world,
a single philosophy.
The rise of digital channels has shifted the brand emphasis from
structure to culture, believes Neil Taylor, creative director at
language consultancy The Writer. He notes: Social media and viral
marketing stop brands doing what they used to do, which was to
manage brands in a command-and-control sort of way.
It becomes more important that your brand reflects your culture,
rather than your guidelines. The brands that have done it well are
those that have a strong culture of their own, says Taylor.
ASmallWorld is an example of a business that has created a brand
which is consistent around the globe (see case study below).
Language is an important element in ensuring a consistent brand
culture, he adds, citing Innocent Drinks as a good example of a
company that has successfully retained a distinctive tone of voice
across markets. You read Innocent Drinks in French and it feels
just as playful and cute as Innocent in English. Its the same
personality.
2 Be borderless in your marketingWith the abundance of digital
platforms, it is no longer possible for brands to follow different
brand strategies in different countries. Companies are being forced
to adopt a more unified marketing approach.
Marketers need to rethink the term glocal, explains Publicis
Modems Tony Effik. Theodore Levitts think global, act local slogan
doesnt work in a digital age in the same way, he argues. The way we
do global campaigns had to change because digital doesnt respect
borders, particularly now with social media. What were finding is
that as content moves across borders, brand stories are crossing
over internationally.
3 Build yourself an internal hubThe need for a unified marketing
team is more important than ever. Involving marketers from across
the global brand in the overall marketing strategy will engender
overall cohesion, says Kip Knight, president of Knight Vision
Marketing, who has set up marketing academies for global
heavyweights such as PepsiCo and eBay while working at those
companies.
He says: It doesnt work to simply hand somebody a strategy and
say, well good luck with that. They have to feel like theyve had a
chance to vet it, to debate it, ideally in person, with others that
are equally responsible for the brand. Ultimately, theyve got to
feel like they own it. Its not my strategy; its our strategy.
By taking this approach, marketers are much more likely to focus
on the same goals for the brand, as opposed to feeling like theyve
got to go and create their own version of this brand in the market,
he adds.
4 Adopt a glocal structureTwo major global brands have recently
challenged the local marketing structure that had become the norm.
Instead they are adopting a more regional structure in a bid to
become more unified.
Coke has scrapped its GB marketing director and simplified its
operations in Europe by reducing the number of business units it
has from ten to four.
Similarly, Kraft has decided that while a GB marketing director
position will exist, marketing will be led centrally from
Europe.
A spokesperson for Coca-Cola explains: The restructuring of
marketing is simply part of this wider process. The changes will
enable us to innovate more quickly and accelerate the increased
coordination in our marketing already taking place in Europe and
globally.
The ability to be both global and local is paramount for
successful international campaigns, explains Wendy Clark, senior
vice-president integrated marketing communications and capabilities
at Coca-Cola. Coca-Cola has a legacy of leveraging global scale and
local relevance. And we know how important it is to balance
both.
The FIFA World Cup Campaign, and Cokes global Open Happiness
campaign are examples of how its marketing works on a global scale.
They are created so that they work across all territories, she
adds.
5 Make consumers your co-creatorsDurexs Valle thinks that social
media has helped to create the perfect environment for
interactions. Its all about consumers advising each other, talking
to each other, as well as talking to the brand. It all happens on a
global scale and it all happens at the same time.
Consumers are creating virals and content for Durex, which then
becomes widely available across the internet.
We cant have the illusion that because we are the manufacturers
or the industry that we have control because that isnt the case
anymore. What makes the difference is the degree of partnership. If
we talk about a new way of operating or a new global brand, it will
be a brand that is asking for opinion, that listens to consumers
and asks for co-creation.
Cokes Clark agrees that making space for consumers is now a
must. At Coca-Cola, were changing with our consumers. Were moving
from polishing our content to perfection to leaving room for our
consumers to add their voice.
Brand Audit:
WHAT IS A BRAND AUDIT ?Abrand audit is a thorough examination of
a brands current position in the market compared to its competitors
and a review of its effectiveness. It helps you determine the
strength of your brand together with its weaknesses or
inconsistencies and opportunities for improvement and new
developments.
WHY DO A BRAND AUDIT ?Strong brands make more money. The
stronger your brand, the more powerful your business. A powerful
brand can inspire, captivate and engage your audience and
consequently dramatically increase your bottom line. However, even
strong brands need a reality check or health check to keep them on
track.
A robust, consistent brand means you spend less money attracting
new customers. Your current customers keep coming back to you and
you are able to charge a premium price for your goods and services.
A powerful brand also encourages referrals, be they online in the
social engagement arena or offline in physical form, and are
consequently a critical part of the brand and its
profitability.
WHAT ARE THE DELIVERABLES OF A BRAND AUDIT ?Essentially a brand
audit will reveal how the customer perceives the brand, how the
brand compares to the competition and how the brand has performed.
The outputs will typically support the following:
Improve and refocus brand management efforts and congruency
Enhance internal staff brand awareness
Sharpen marketing communications both on and offline
Provide insight into your brand architecture, business structure
and brand portfolio
Evaluate and refocus your brand positioning Ensure your brand
collateral is congruent and delivers return on investment
Provide direction for your brand into the future
Secure and grow the value of your brand/business through
consistent implementation of recommendations derived from brand
audit findings
WHAT'S INVOLVED IN A BRAND AUDIT ?Wheninitiating a brand audit
its important to define the brand audit objectives. A brand audit
is typically a bespoke service because there are so many different
components to an actual audit, all of which may not be relevant or
required to conduct an appropriate evaluation of your brand
performance.
The depth and extent of a brand audit is largely determined by
the size of the brand, organisation, market, timescales and budget
together with the size and power of your brand relative to the
business and market in which you operate.
Brand Leverage
(Brand Leveraging) broadening a company's product range by
introducing additional forms or types of products under a brand
name which is already successful in another category. Also called
Product Leveraging, Brand Extension and Franchise Extension.
Role of Brand Manager
Instilling a marketing led ethos throughout the business
Researching and reporting on external opportunities
Understanding current and potential customers
Managing the customer journey (customer relationship
management)
Developing the marketing strategy and plan
Management of the marketing mix
Managing agencies
Measuring success
Managing budgets
Ensuring timely delivery
Writing copy
Approving images
Developing guidelines
Making customer focused decisions
Arguments for Provides confidence to buyers: Consumers of all
types and areas are today aspiring for quality of life as a
consequence of the development schemes of government and NGOs. The
literate and illiterate, the urban and rural, men and women prefer
to buy branded products. Even the poor prefer branded shampoos and
hair oils sold in small volume sachets. To customers, brands
symbolize quality. They think the perceived risk in buying will be
lower.People are confident in buying brands like Lux, Lifebuoy,
Fair& Lovely, Horlicks, Boost, Bournvita, Parachute, Navaratna,
Sunsilk, Clinic plus, and Meera. Provides distinguishing identity:
A brand name gives identity to a companys product. It helps
recognition and processing jobs easy for the company, distributors
and consumers. It thus saves costs and time in manufacturing,
warehousing, transporting and order processing for the company when
selling. Distributors can reap similar benefits in handling the
products and selling them. Consumers find it easy to spot and
select the product. eople can distinguish Coca cola, Pepsi and
Thumsup. Though all of them are cola drinks, they differ in
packaging and taste. Image gives competitive advantage: Brands earn
recognition and reputation by their performance. The image helps
the existing products in the line as well as new products. It gives
a commanding position to the marketer to charge higher prices than
competitors and to convince distributors to carry the products.
Organisations interested in quality office furniture buy from
Godrej. Men interested in buying quality suits buy from Raymond.
Women interested in quality jewellery, buy from Tanishq.
Personality attracts consumers: Brands in course of their
association with consumers develop personalities. Advertisers take
this opportunity to match the personality of brands with that of
prospects. It helps build brand loyaltya lasting companionship, a
strong bondage between a brand and consumer. Marketers create a
personality for the brands they sell. Raymond talks about complete
man. Fair& Lovely presents woman as an achiever. Pleasure
scooty of Hero Honda asks why boys should have all the fun and
presents a liberated young girl.
Enhances value: By their popularity, brands not only enhance
their value-in-use but also value-in-exchange. A company that has
built brand image over a period of time by its incessant innovative
efforts gets a reward for example, premium price offer for its
brand from a competitor or interested entrepreneur willing to own
it. Allows buying inertia-In industrial markets, quality, price and
service are vital but in practice there is one over-riding issue
which is seldom mentioned as a reason for choosing a company - that
is because we have always bought from that company. Just consider
the number of years people in industry have used the same companies
as their main suppliers. It is not unusual for a supplier to have
been used for five, ten or even twenty years. Arguments Against
Category competition: Most of the Indians are price conscious. As
such, the competition is more of categories rather than brands. 70%
of the population living in villages are less literate and
gullible. As such, branded products are not affordable to many. The
real competition is not among brands but categories. Notion of high
prices: The common notion prevalent among rural and mid income
consumers is branded products are high-priced ones. As such, they
shun brands. Investment-returns doubtful: Brand building is not an
easy task. It requires a great deal of long range investment. It is
to be supported by R & D investment, advertising budget and
dealer discounts. However, there is no assurance of returns. Many
brands have failed. Many are struggling hard despite the good
images they have built over a time. Image and personality are
emotional nonsense: All the talk about brand personality and image
are psychological fantasies created by marketers. No product sells
on brand name. Only when it fulfils a need, does it stay and
succeed in the market. The image of a product or brand cannot help
other brands. When a person buys the product, the overriding
considerations are cost (price and operational economics) and
functional benefits Brand equity is sensible but not new: The brand
equity concept replaces the old term good will. It is not something
new to be argued in favour of a brand. It is the outcome of
business built over a period. People trust Tata companies, Godrej,
Mafatlal etc., as they were operating long since and offering
reasonably good products. Customers prefer to buy from a local
retailer who is known and sometimes buy on his or her
recommendation.
CASE STUDYTesco Goes High TechMoving up the value chain, it is
now crafting products that will transform Tescos global business,
especially developing mobile applications that drive online
sales.
There are a variety of mobile applications being developed from
Tesco HSC. Tesco has launched mobile grocery applications on the
Android, iPhone, iPad, Nokia and Windows 7 platforms to enable the
customer to shop while being mobile. These apps are engineered and
maintained at the Tesco HSC, Sandeep Dhar, CEO said.
The Android application was developed completely by the Tesco
HSC mobile engineering team and they have been involved in all
feature releases after the initial release. The iPhone app is the
first Tesco mobile app and has seen more than two million downloads
since its launch. The mobile engineering team at the Bangalore
centre has grown to 20 from zilch in less than a years time.
Mobile commerce is a growing segment and is an additional
channel of shopping for our customers. In terms of sales, 8% of our
online grocery orders touch a mobile phone with about half these
orders being completed 100% on the phone. Looking at e-commerce as
a whole, Tesco is UKs largest online retailer processing over five
lakh orders a week, Dhar says. Since 2004, Tesco HSC - that now
houses 6,000 people - has provided the technology and services
backbone for a $100-billion business that serves 60 million
customers.
India provides support to Tesco operations in the UK, the US,
major European countries and growth markets such as Turkey, South
Korea, Thailand and China. The shift from just a support base to
one that manages mission-critical IT applications came a few years
ago. Contributions out of the centre are now aligned to business
goals of Tesco, says Dhar.
For example, he says, Tesco has deployed cutting-edge paperless
picking technology at its warehouses: Employees entering the
mammoth
distribution centres use a wrist device that could be swiped at
the entrance of these warehouses. On swiping, each employee is
given a task list for selection of a particular product from a
warehouse section and the information regarding the store to which
the products need to be delivered. Tesco HSC delivered the software
and then ran this function.
Tescos global parent saves up to $100 million every year by
outsourcing tech work to India. And it is this service centre that
was responsible for implementing the Tesco Operating Model (TOM) in
2008 that lies at the heart of the companys global drive and
consequent growth.
While Indias IT success story has spawned several instances
where strategic moves have been supported from India, Tescos is a
first in retail where business processes (and technology) meant for
global implementation have been provided for, and sustained out of
an India back-office centre, says Dhar. As a result, stores from
China to the US use the same technology and process for buying
merchandise, billing customers and managing stores.
Tescos local centre has become a successful global player in
technology as it realised that the talent model is an important
lever for captives to optimise in support of future growth. This
means aligning its talent model to building a global pool of
end-to-end IT skills and domain knowledge.
We have continued to build a strong workforce that is on the
cutting edge of future retailing concepts with the ability to
develop and enhance retail solutions based on functional and
technical expertise. Our investment in talent development
programmes has resulted in positive scores on employee surveys that
confirm employee engagement is a leading indicator of our overall
business success, he says. Dhar is excited about future
applications coming out of the centre.
A user-friendly feature is bar code scanning support. You can
now scan any grocery item with your iPhone and it will be
automatically added to your Tesco Online shopping basket. Right
where the user sees an interesting product - at a friends place or
on a train - she can scan the bar code and add the product to the
basket, buy it immediately or later.