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BUILDING, MEASURING, AND MANAGING BRAND EQUITY

BRAND MANAGEMENT

Bhushan D. Sudhakar, Ph.DAssistant Professor & Co-ordinator (UG)

What is a Brand?A brand is a name, term, sign, symbol, or design which is intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.

New Branding Challenges Brands are important as everConsumer need for simplificationConsumer need for risk reductionBrand management is as difficult as everSavvy consumersIncreased competitionDecreased effectiveness of traditional marketing tools and emergence of new marketing toolsComplex brand and product portfolios

The Customer/Brand ChallengeIn this difficult environment, marketers must have a keen understanding of:customersbrandsthe relationship between the two

The Concept of Brand EquityThe brand equity concept stresses the importance of the brand in marketing strategies.Brand equity is defined in terms of the marketing effects uniquely attributable to the brand.Brand equity relates to the fact that different outcomes result in the marketing of a product or service because of its brand name, as compared to if the same product or service did not have that name.

The Concept of Customer-Based Brand EquityCustomer-based brand equityDifferential effectCustomer brand knowledgeCustomer response to brand marketing

Determinants of Customer-Based Brand EquityCustomer is aware of and familiar with the brandCustomer holds some strong, favorable, and unique brand associations in memory

Building Customer-Based Brand EquityBrand knowledge structures depend on . . .The initial choices for the brand elements The supporting marketing program and the manner by which the brand is integrated into itOther associations indirectly transferred to the brand by linking it to some other entities

Benefits of Customer-Based Brand EquityEnjoy greater brand loyalty, usage, and affinityCommand larger price premiumsReceive greater trade cooperation & supportIncrease marketing communication effectivenessYield licensing opportunitiesSupport brand extensions.

Customer-Based Brand Equityas a BridgeCustomer-based brand equity represents the added value endowed to a product as a result of past investments in the marketing of a brand.Customer-based brand equity provides direction and focus to future marketing activities

The Key to BrandingFor branding strategies to be successful, consumers must be convinced that there are meaningful differences among brands in the product or service category.Consumer must not think that all brands in the category are the same.PERCEPTION = VALUE

Strategic Brand ManagementStrategic brand management involves the design and implementation of marketing programs and activities to build, measure, and manage brand equity. The strategic brand management process is defined as involving four main steps:1) Identifying and establishing brand positioning and values2)Planning and implementing brand marketing programs3)Measuring and interpreting brand performance4)Growing and sustaining brand equity

Motivation forCustomer-Based Brand Equity ModelMarketers know strong brands are important but arent always sure how to build one.CBBE model was designed to be comprehensive cohesive well-grounded up-to-dateactionable

Rationale of Customer-Based Brand Equity ModelBasic premise: Power of a brand resides in the minds of customersChallenge is to ensure customers have the right types of experiences with products & services and their marketing programs to create the right brand knowledge structures:ThoughtsFeelingsImagesPerceptionsAttitudes

Building Customer-Based Brand EquityBuilding a strong brand involves a series of steps as part of a branding ladderA strong brand is also characterized by a logically constructed set of brand building blocks.Identifies areas of strength and weaknessProvides guidance to marketing activities

Salience DimensionsDepth of brand awarenessEase of recognition & recallStrength & clarity of category membershipBreadth of brand awarenessPurchase considerationConsumption consideration

Performance Dimensions Primary characteristics & supplementary featuresProduct reliability, durability, and serviceabilityService effectiveness, efficiency, and empathyStyle and designPrice

Imagery DimensionsUser profilesDemographic & psychographic characteristicsActual or aspirationalGroup perceptions -- popularityPurchase & usage situationsType of channel, specific stores, ease of purchaseTime (day, week, month, year, etc.), location, and context of usagePersonality & valuesSincerity, excitement, competence, sophistication, & ruggednessHistory, heritage, & experiencesNostalgiaMemories

Judgment DimensionsBrand qualityValueSatisfactionBrand credibilityExpertiseTrustworthinessLikabilityBrand considerationRelevanceBrand superiorityDifferentiation

Feelings DimensionsWarmthFunExcitementSecuritySocial approvalSelf-respect

Resonance Dimensions Behavioral loyaltyFrequency and amount of repeat purchasesAttitudinal attachmentLove brand (favorite possessions; a little pleasure)Proud of brandSense of communityKinshipAffiliationActive engagementSeek informationJoin clubVisit web site, chat rooms

Brand PositioningDefine competitive frame of referenceTarget marketNature of competitionDefine desired brand knowledge structuresPoints-of-paritynecessarycompetitivePoints-of-differencestrong, favorable, and unique brand associations

Issues in Implementing Brand PositioningEstablishing Category MembershipIdentifying & Choosing POPs & PODsCommunicating & Establishing POPs & PODsSustaining & Evolving PODs & POPs

Establishing Category MembershipProduct descriptorExemplar comparisons

Identifying & Choosing POPs & PODsDesirability criteria (consumer perspective)Personally relevantDistinctive & superiorBelievable & credibleDeliverability criteria (firm perspective)Feasible ProfitablePre-emptive, defensible & difficult to attack

Major Challenges in PositioningFind compelling & impactful points-of-difference (MacMillan & McGrath, HBR, 97)How do people become aware of their need for your product and service?How do consumers find your offering?How do consumers make their final selection?How do consumers order and purchase your product or service?What happens when your product or service is delivered?How is your product installed?How is your product or service paid for?

Major Challenges in PositioningFind compelling & impactful points-of-difference (cont.) How is your product stored?How is your product moved around?What is the consumer really using your product for?What do consumers need help with when they use your product?What about returns or exchanges?How is your product repaired or serviced?What happens when your product is disposed of or no longer used?

Communicating & Establishing POPs & PODsCreate POPs and PODs in the face of attribute & benefit trade-offsPrice & qualityConvenience & qualityTaste & low caloriesEfficacy & mildnessPower & safetyUbiquity & prestigeComprehensiveness (variety) & simplicityStrength & refinement

Strategies to Reconcile Attribute & Benefit Trade-OffsEstablish separate marketing programsLeverage secondary association (e.g., co-brand)Re-define the relationship from negative to positive

Sustaining & EvolvingPOPs & PODsCore Brand Values &Core Brand Proposition

Core Brand ValuesSet of abstract concepts or phrases that characterize the 5-10 most important dimensions of the mental map of a brand. Relate to points-of-parity and points-of-differenceMental Map Core Brand Values Brand Mantra

Brand MantrasA brand mantra is an articulation of the heart and soul of the brand. Brand mantras are short three to five word phrases that capture the irrefutable essence or spirit of the brand positioning and brand values. NikeAuthentic Athletic PerformanceDisneyFun Family Entertainment

OutlineThe mandate for effectivenessWhat makes an ad effective?The world of advertisingThe five players of advertisingThe evolution of advertisingIntroduction to Advertising

The Mandate for EffectivenessToday advertising is in a bindAdvertisers expect specific results that lead to salesAdvertising must be effective

What Makes an Ad Effective?Effective ads work on two levels: with consumers and with advertisersCharacteristics of effective ads:Strategy- ExecutionAdvertising must be goal directed

The World of AdvertisingDefining advertisingA paid form of communicationA sponsor is identifiedTries to persuade or influence the consumer to do somethingConveyed through mass mediaReaches a large audience Is nonpersonal

Types of AdvertisingBrand advertisingRetail/local advertisingPolitical advertisingDirectory advertisingDirect-response advertisingBusiness-to-business advertisingInstitutional advertisingPublic service advertising (PSA)Interactive advertising

The Roles of AdvertisingMarketing roleCommunication roleEconomic roleSocietal role

Functions of AdvertisingProvide product and brand informationProvide incentives to take actionProvide reminders and reinforcement

The Five Players of AdvertisingAdvertiserAdvertising agencyThe advertising departmentThe in-house agencyMediaVendorsTarget audience

The Evolution of AdvertisingAge of printIndustrial revolution and emergence of consumer societyModern advertising: Agencies, science and creativityAccountability era

Current Advertising IssuesInteractive advertisingGlobalizationNiche marketingIntegrated marketing communications (IMC)Consumer Power

How Brands WorkBrand personalities BrandingTrustB