Jerusalem, November 20th, 2008 Brand: A Mark of Quality

PODRAVKA DD.

KOPRIVNICA, CROATIA

BRAND: A MARK OF QUALITY

Katarina Gaži Pavelić

BRAND: A MARK OF QUALITY

Presentation topics:

• The importance of brand

• The perceived brand quality

• Aligning the percived quality with the actual

brand quality

Author: K. Gaži Pavelić, dipl.oec.,

EOQ Quality Systems Manager and Auditor

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

What is a brand?

3

“Brands are solaces for our soul – beacons in

the chaotic world.”

R. Ridderstråle, K.A. Nordström

A brand is a name, term, sign, symbol or

design, or a combination of them, intended to

identify the goods or services of one seller or

group of sellers and to differentiate them

from those of competitors.

Kotler et al. 1999

" A product is something

that is made in a

factory; a brand is

something that is

bought by a customer.

A product can be copied by a competitor, a brand is

unique. A product can be quickly outdated; a successful

brand is timeless.“

Brand is unique

Source: Stephen King, WPP Group, London

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

5

Reasons for branding

• Product differentiation Brand gives customers clear emotional and logical reasons to

buy a product

• Value perception Customers perceive brands as products of a higher quality, more

reliable and as those who offer higher value for money.

- Brand no one > 10% more expensive then brand no two, > 40%

more expensive then a private brand.

• Brand loyalty Repeat business is significant to long-term business success

- Costs are up to 90% lower

• Pride Known brand makes company employees proud

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

6

Reasons against branding

• Inability to identify: if brand cannot be identified

or distinguished from substitutes

• Inability to maintain quality: branding would mark

out items to avoid

• Very small market: not cost effective

• Irregular availability: must assure steady supply

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

7

Brand Equity

Brand equity is the added value endowed on

products and services, which may be reflected

in the way consumers, think, feel, and act with

respect to the brand.

Kotler et al. 1999

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

8

What is Brand Equity?

Brand Equity

Brand loyalty

Brand awareness • Reason-to-buy • Differentiate/ position • Price • Channel member interest • Extensions

Perceived brand

quality

Brand associations

Other proprietary brand assets

"It is only shallow people who do not judge by

appearances."

Oscar Wilde

Percieved Quality

Perceived quality is defined as a consumer’s

evaluation of a brand’s overall excellence

based on intrinsic (e.g., performance,

durability) and extrinsic cues (e.g., brand

name, warranty) (Kirmani and Baumgartner, 2000)

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

11

Perceived Brand Quality

• Reason to buy - Customer has not the time or ability to evaluate the quality

objectively.

- Perception of quality is the determinant factor in the buying decision.

• Differentiation/ positioning - Establishing a specific image for a brand (the best, premium,

excellent) in relation to competing brands and their quality

• Premium price - When the perceived quality is high, price may be/ must be

accordingly higher

- perceived quality enhances profit growth (premium price = quality)

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

12

Perceived Brand Quality/ cont.

• Marketing chanell members' interest

- Strong influence on the marketing chanell members

(distributors, wholesale, retailers).

• Brand extentions

- Giving of a popular brand name to a new product in an

unrelated product category

• Brand contraction (only one, supreme brand), A. Ries

- a company is positioning itself as a specialist

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

13

Customer Expectations

• Performance: fulfillment of product’s primary operating

characteristics.

• Features: desirable product characteristics that supplement

basic functioning

• Conformance to specifications: failure incidence, occurence of defects (production oriented quality)

• Reliability/consistency: allways the same level of Performance, Aesthetics, taste etc.

• Durability: actual equals the promised and the expected

• Service : efficient, competent and appropriate

• Aesthetics: product looks and feels like a quality product

Acc. to D. Garvinu

Jerusalem, 10. srpanj 2013.g. Brand: A Mark of Quality

Transforming the real quality into the

percieved quality

14

• Commitment to quality

• Quality culture

• Customer feedback

• Measuring, goals and standards

• Customer expectations

Transformation of the real quality into the

percieved quality is possible only if a company

has:

Brand is the quality pledge

It is not enough to claim "We are the best!"

Customers need a quality warranty that a

company is really behind it's brand promises

The pledge must be:

– unconditional

– understandable

– easily fulfilled

– significant for a customer

THANK YOU!