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Strategic Brand Management for the moduleStrategic Brand Management.
Contents
1. Brand
2. History of Brand
3. Why Branding
4. Brand Overview
5. Dilemma of Branding
6. Aspects of Brand
6.1 As per Consumer Appeal
6.2 As per Consumer Needs
7. Evolution of Brand
8. Market development in terms of Brand
9. Brand: consumer perception
10. Brand Positioning
11. Nature and Characteristics of the Service Brand
12. The Underlying principals in Hospitality
13. Types of Brand in the Hospitality
14. Brand Image
15. Brand Equity
16. Factors for the success of a Brand
17. Challenges for the Brand
18. Positioning brand right
19. Functional Brand
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20. Emotional Brand
21. Symbolic Brand
22. Brands have evolved
23. Brand in the new world
24. Thoughts for the future
25. References
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Brand
The word brand has originated from the old norse word brandr, which means to burn as
brands were and still are the means by which owners of livestock mark their animals to
identify them. The word brand creates an image which itself gives an impression that
what brand is all about. Brand is something which is in the mind of consumer and other
stakeholders; it is the how they perceive a product or service.
A mixture of tangible and intangible attributes symbolized in a tradematrk, which,
if properly managed, creates influence and generates value. Interband (2007)
According AMA (American marketing association) a brand is a name, term,
sign, symbol, or design, or a combination of them, intended to identify the goods
and services of the seller or group of sellers and differentiate them from those of
competition. Technically speaking, then, whenever a marketer creates a new
name, logo, or symbol for new product, he or she has created a brand. (Keller,
2003)
The brand has different definitions as one definition can be very limiting to its meaning.
The brand definitions are even categorized under six headings by some experts. (Randall
G., 1998):
Visual
Perceptual
Positioning
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Added value
Image
Personality (Hankinson and Cowking, 1993) some examples of the same are
McDonalds, K.F.C., Celebrity endorsements
History of Brand
Brands were originally meant to commercially communicate, craftsman and farmers used
to mark their product before selling them in the market so that people could identify the
source of the product. Tobacco and patent medicine companies along with some other
businesses started first mass-market brands in the early 19th century with the help of
uniform packing and advertising campaigns. National brands started developing in USA
and Europe towards the end of 19th century. Advertising started on the large scale along
with the increase in the literacy rate. The immigrants in the USA helped large open
markets which lead to mass merchandising. Brands like American Express, Coca-Cola,
Heinz and Kodak were already established in the 1890s however all the big brands
suffered because of the Great Depression in the 1930s. This was the time when brand
management came into effect.
Why Branding
An obvious question comes to the mind is that why do we need a brand. As mentioned
earlier that brand remains in the mind of the consumer and that is difficult to control and
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all the individuals have different relationships with the brands then why do we need to
create an image or positioning in the minds of these individuals. While the consensus is
that every organization needs to develop strong brands as an essential part of their
business strategy, the precise means for bringing this about are fraught with both
conceptual ambiguities, many of these are noted by Balmer (2001) and practical
difficulties. The branding literature seems to suggest that developing strong brands is a
worthy independent marketing goal, autonomous from others concerns of the
organization. The brands are very potent and sometimes more powerful than the product
or the service itself which they represent. Brand strength certainly impresses. Coca-
Cola brand is an example; the brand has more value than the entire organization which
owns it. According to the Business Week list of the top brands, the Coke brand is worth a
value of about $70 billion.
Brand Overview
According to David Ogilvy (Macrae et al, 1996), Brands are a part of the fabric
of life and same is supported here by an example. (Randall G.,1998). No-one
ever got fired for buying IBM, this saying takes a whole new meaning to the
word brand and its power. IBM dominated the world market of IT solutions like
no other company in any other field. IBM till late nineties was having 60% of the
sales and 80% of world profits with the support of the strong brand value.
(Randall G.,1998).
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According to Thomas Gad brands strike cords, however striking the right cord is
very difficult and most of the time a costly. (Gad T., 2001) The brands have so
much of value in todays world that John Stuart who was chairman of the Quaker
oats ltd said that if this business were to be split up, I would be glad to take the
brands, trademarks and goodwill and you could have all the bricks and mortar and
I would fare better than you. (Chernatony L., 2007)
According to Joel Desgrippes, Branding is not only about ubiquity, visibility, and
functions; it is about bonding emotionally with people in their daily life. Only
when a product or a service kindles an emotional dialogue with the consumer, can
this product or service qualify to be a brand. (Gobe M., 2001) This definition
surrounds the emotional side of the brand value. The brand has to have some kind
of emotional bonding with the consumer then only it can work as a brand and
sustain its value for a longer period of time.
Dilemma of branding
In the branding process, the brand's strength is built on a definite logic for each brand. In
this sense, branding appears to have rules, but the branding literature provides elusive
advice to managers. Anecdotal discussions of strong and powerful brands dominate the
marketing literature, and this is where the problems arise, different strong brands suggest
different courses of action, different brand management principles. While Coke had
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Evolution of Brand
The branding is evolving with the times. The time is the most important factor for todays
generation. People around the globe are having less and less time for them and spending
more and more time to make themselves successful or sometimes just to earn enough.
The brands have to provide something to someone and not everything to everyone. It is
time of mass customization. The people spend more n services than products. Two polls
conducted by the founder of America Research Group found that Americans are spending
more of their gift allowances on presents that enhance family life and personal well
being. (Gobe M, 2001) The time to provide services that enhance the quality of peoples
lives, services which provide an experience.
In the contemporary context, there are three essentials to manage a successful brand
Brands have life cycle The brands have to be relevant to survive in the long run,
as brands have life cycle and they have to protect their value to make it great.
Brands are elected everyday It is important for a brand to remain emotionally
attached to their customers and committed to quality. Overexposure of any brand
can kill it.
Real brands are about meaning and truth As earlier said that brands need to have
emotional connection with the consumers however at the same time they need to
be sincere and quality driven.
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practitioners (Gardner and Levy, 1955; Park et al., 1986; Ries and Trout, 1986) have
recommended that developing, communicating, and maintaining a brands image is
crucial to its long-term success.
Nature and Characteristics of the Service Brand
The main parts of the branding for the service industry are following. (Lecture Note 1)
Intangibility The service is of intangible nature which can not be seen or felt.
Variability Service quality depends on the person who provides it and when,
where and how it is delivered.
Inseparability The service is part of the service provider, it can not separated
from same.
Perishability The service has to be consumed at the generated, it can not be
stored for the future use.
The Underlying principals in Hospitality
In the hospitality industry, the intangible factures such as relaxation, education and
entertainment must be emphasized. The process involved for the same is following.
(Lecture Note 1)
Pre-consumption
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The stay itself
Post Consumption
The hospitality brands have to take a decision that at which level they would want their
brand to be positioned. Organizations like Ritz Carlton build brands at all three levels.
The Branding for the Hospitality industry is based on following points: (Lecture Note 1)
The hospitality industry is more supply-centric than other industries of the service
sector.
The product of the hospitality industry is present at multiple levels.
Branding for the hospitality required high degree of involvement and risk.
Types of Brand in the Hospitality
The hospitality industry has different types of brand and one has to take care of same
while talking about the brand image. The types of hospitality brands are following.
(Lecture Note 1)
Corporate Brands like McDonalds, Disney etc
Retail Brands like Pizza Express, Pret a Manger etc
Person Brands like Jamie Oliver, Harry Ramsden etc
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Brand Image
The importance of a brands image in its long-term success necessitates having a
framework for strategically managing the image over the long term (Park et al., 1986).
Brand managers have had very little direction for setting up such a conceptual
framework. One notable exception is brand concept management (BCM) proposed by
Park et al. (1986). BCM proposes that every brand image should be based on a brand
concept or a brand-specific abstract meaning.
Brand Equity
Marketers always had this idea that brand names have and add value to a product or a
service; however it was considered part of the actual asset value of a company in 1980s
only. This activity generated the term brand equity.
As per to one expert brand equity is the difference between the value of the brand to the
consumer and the value of the product without that branding (Josh McQueen, 1991)
According to Aaker brand equity is a set of assets and liabilities linked to a brand, its
name and symbol that add value or subtract the value provided by a product or service to
a firm and/or to that firms customers. (Aaker, 1991) As per Aaker these assets and
liabilities can be grouped in following five categories. (Randall G, 1997)
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Brand Loyalty
Name Awareness
Perceived quality
Brand association in addition to perceived quality
Other proprietary brand assets patents, trademarks, channel relationships etc
Factors for the success of a Brand
Following factors are important for the success of any brand. According to Morgan and
Pritchard (2004) those factors are following. (Lecture Note 2)
The Brand should be credible. The consumers trust in a brand is important for the
brands success.
The Brand should be deliverable, if it can not be deliver the promised service or
product, it would fail.
The Brand should differ from the other services or product. It should have a
distinctive quality of itself.
Another important factor is the resonance of the Brand with the consumer.
Challenges for the Brand -
There are certain challenges for the development of Brand and the same are following. It
important for the managers to be aware of these challenges, and make their way through
them. (Lecture Note 2)
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Savvy Customers The customers are well informed today and needs to be given
due attention.
Brand Proliferation
Media Fragmentation
Increased Competition
Increased Costs
Greater Accountability
Positioning Brand right
The existence of different types of motivations among individuals suggests
that within most product categories, consumers needs could be either
functional or symbolic in nature, and brands could be positioned to satisfy
either of these two types of needs. Thus, functional or utilitarian needs of
consumers could be exploited with a functional brand, i.e. one positioned
with a functional brand concept or meaning. Similarly, a brand could be
positioned as a symbolic brand to tap the needs of those who wish to
enhance their self-image or their social image. Park et al. further argued that
brands should be positioned to appeal to either one of these types of needs, but
not both, for a number of reasons.
As practice of positioning became more sophisticated, marketers of all types
began to 'position' their brands competitively by associating them with
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perceptual space inside the target's head. The argument went that to create
brand equity, brands needed to be defined by own able ideas (a unique selling
proposition or positioning) rather than features or price, which competitors
could easily copy. Positionings were often based as much on what perceptual
space marketers believed was open in targets' minds as on what a product or
service actually did. Over the years, identical cold medicines squared off to
own cough vs. sneezing as a point of difference. Identical toothpastes stood
for whitening vs. gum health.
Park et al. (1986) further argued that brands should be positioned to appeal to
either one of these types of needs, but not both, for a number of reasons. A
brand concept that is both functional and symbolic poses problems for
consumers because they cannot clearly relate the brand to either their
functional or their symbolic needs. In addition, it increases the number of
competing brands and makes brand image management difficult.
As per Park, Jaworski and Mclnnis (1986) there are three types of brands
images (functional, Emotional-Symbolic and experiential). Here, first two
have been discussed as brands in the service industry are gradually changing
from function brands to symbolic brands. The demand for association with the
experience and feeling of the service is becoming more essential than ever.
Functional Brand
Functional brands satisfy immediate and practical needs. For example, in the
category of airline, the brand Air Deccan in India would be considered a
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functional brand since its usefulness lies primarily in its ability to transport
people from one place to another at comparatively cheaper fares.
Functional brand relates to an image of performance and practicality. A
functional brand is often derived from a concrete attribute of a brand and
comes from externally generated needs. Functional brands have no links to the
personality. Product classes such as microwaves and hotels like Formula 1 are
examples of functional brands. These brands basically solve the problems of
the consumer and satisfy consumer needs
Emotional Branding
The foundation for the change from branding to emotional branding is a shift
from production based economy to consumer based economy. The brands
have become more of objects of desire than just being objects of functionality.
The computers have become lifestyle entertainment items rather than just
technology equipment. The airlines and hotels are no longer means of
transportation and place to stay respectively, they have become your part of
personality, the airline one flies and hotel you associate with, let others know
what class of society one belongs to. The important words in the world of
brand are now sensory experience and ultra chic etc. (Gobe M, 2001) The
four pillars of emotional branding are Relationship, Sensorial Experience,
Imagination and Vision. They give direction to the brand managers to plan
their work strategically and reap the results.
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According to the Gobe Mark there is major shift in the economies from
factory based to consumer based economy. The same is explained here with
the following illustration. (Gobe M, 2001)
Old Economy New Economy -
Factory Based: Consumer Based:
Capabilities-driven: rely on existing equipment Outsource Production
Slow developer to market Fast to Market
Manufacture product Create Brands
Production- Focused Consumer-focused
Symbolic Brand
Symbolic brands satisfy symbolic needs such as those for self-expression and
prestige, and their practical usage is only incidental. For example, in the
category of wrist watches, the brand Casio would be considered a functional
brand since its usefulness lies primarily in its ability to tell the time correctly.
The brand Movado, on the other hand, would be considered a symbolic brand
since it is used primarily for its status appeal, and its ability to tell the time is
only an incidental reason for its usage. Once a concept is selected for a brand,
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Park et al. (1986) advise that it should be maintained over the brands life for
sake of consistency.
Symbolic Brand concepts emphasize the brands relationship with group
members of self. The symbolic brand concept is tied to the reference group or
ego enhancing association to the brand. Symbolic brand concepts are
characterized by an abstract and holistic image. For example, the Airline
brand Kingfisher, can be considered a symbolic brand since it is used
primarily for its status appeal, and its ability to provide experience to its
customers with very modern and ultra-chic services however at a price. Once
a concept is selected for a brand, Park et al. (1986) advise that it should be
maintained over the brands life for sake of consistency.
Brands have evolved
According to the Maslows Hierachy of needs and branding. (lecture note 3)
The Brands about a decade ago were meant to satisfy the Physiological needs of
the consumers. The example of this level is budget operators in the field and
aviation and hotels. E.g. Ryan Air
The next level of the evolving was for the Safety Needs of the consumers. E.g.
Ikeas, Roosters
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The brands evolved to next level where social needs of the consumers were more
important. E.g. Pizza Hut
Esteem needs of the consumers are important at this level. E.g. Marriot, Four
Seasons
Self-Actualization This is where a consumer needs the service or product for the
self actualization. The hotels like Burj-al-Arab are good examples at this level.
Brand in the new world
The brand in the todays world connects people with the companies sublimely. For
example, JetBlue is not a typical airline, it does not just provide mean of transport to
travel from one place to another. It is an airline which sells very chic, well coordinated
experience to its customers; the fares are very inexpensive however they have very
stylish urbane planes with cushy seats and DIRECTV channels. Their brand is known for
its coolness.
Thoughts for the future
Many of the assumptions underlying the notion of branding as perception management no
longer hold. Choice proliferation and media fragmentation have made brain real estate in
consumers heads scarcer, and perceptions harder to manage. Consumers seem to have
become savvier, better informed, and less trusting of marketers, making it harder to shape
brand perceptions. Further, products and services have begun to create direct
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relationships with customers, rather than being inter-mediated by retailers, which leads to
the need to brand customer interactions before, during and after the sale.
References
1. Keller, 2003, strategic brand management
2. Randall G., 1998, A practical Guide to branding, page 4-5
3. Gad T., 2001, 4-D Branding, Cracking the corporate code of the network
economy, page 23
4. Randall G., 1998, A practical Guide to branding, page 3
5. Randall G., 1998, A practical Guide to branding), page 1
6. Chernatony L., 2007, From brand vision to brand evaluation, page 3
7. Gobe M., 2001, Emotional Branding, the new paradigm for connecting brands to
people, page xiii
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8. Balmer, J.M.T. (2001), Corporate identity, corporate branding and corporate
marketing: seeing through the fog, European Journal of Marketing,page 248-91.
Dennis L. Duffy, 2003, Internal and external factors which affect customer loyalty,
Journal of Consumer Marketing
9. Mark J. Kay, 2006, Strong brands and corporate brands, European Journal of
Marketing
10. Gobe M., 2001, Emotional Branding, the new paradigm for connecting brands to
people, page xiii
11. Gobe M., 2001, Emotional Branding, the new paradigm for connecting brands to
people, page xiv
12. Gobe M., 2001, Emotional Branding, the new paradigm for connecting brands to
people, page 285-286
13. Gardner, B.B. and Levy, S.J., 1955, The product and the brand, Harvard Business
Review, March-April, page 33-40.
14. Park, C.W., Jaworski, B.J. and MacInnis, D.J., 1986, Strategic brand concept
image management, Journal of Marketing, October, pp. 135-45.
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15. Aaker, D.A. 1991, Managing Brand Equity, page 15
16. Randall G., 1998, Branding, page 29
17. McQueen J., 1991, Leveraging the power of emotion in building brand equity,
ARF Brand Equity Workshop, 5th Feb
18. Park, C.W., Jaworski B.J. and Maclnnis D.J. (1986), Strategic brand concept
image management, journal of marketing page 135-145
19. Dilshad Sheikh, Interband (2007), Lecture Notes 1, Page 2
20. Dilshad Sheikh, Lecture Note 1, Page 3-4
21. Dilshad Sheikh, Lecture Note 1, Page 6
22. Dilshad Sheikh, Lecture Note 1, Page 10
23. Jeff Parry, Lecture Note 2, Page 3
24. Dilshad Sheikh, Lecture Note 3, Page 3