Brand Management- Mod I

Brand

• A brand is a name, term, sign, symbol, design or a combination of the above to identify the goods or service of a seller and differentiate it from the rest of the competitors

A name becomes a brand when consumers associate it with a set of tangible and intangible benefits that they obtain from the product or service

• It is the seller’s promise to deliver the same bundle of benefits/services consistently to buyers (Brand Promise Brand Equity)

Why do Brands Matter?

R

The main reason consumers flock to some brands and ignore others is that behind the brand stands an unspoken promise of value.

B

Brands have become important drivers of growth for any organization, good or service.

N

A brand helps make a mark and differentiate a good or service from others in marketplace.

D

A strong brand makes people aware of what the company represents and about the different offerings of the company.

S

Brands help customers to connect to the product or service on an emotional level.

A

A Brand is a promise that the product will perform as per customer’s expectations.

Role of Brands

• Consumer Benefits Identify source/maker Simplifies decision making Reduces risk

• Marketer Benefits Simplify product handling Protect unique features Create loyalty Establish barriers to entry

Role of brands for consumers• Source of product: Consumers can easily make a purchase decision based

on brands. Consumers usually find brands which satisfy their need.• Lower risk : Brands mean lower purchase risk to consumers as they are

dealing with a product or organization that they trust.• Less cost of searching for a choice :If the consumers recognize a particular

brand and have knowledge about it, they make quick purchase decision and save lot of time. Also, they save search costs for product.

• Symbol of Quality: Consumers see ‘brands’ as a symbol of quality and remain committed and loyal to a brand as long as they believe that the brand will continue meeting their expectations and perform in the desired manner consistently.

• Symbolic device:Brands play a significant role in signifying certain product features to consumers.

Role of brands for sellers • Means of Competitive Advantage : A brand helps the firms to

provide consistently a unique set of characteristics, advantages, and services to the buyers/consumers.

• Legal protection of products’ features: Brands help to protect the unique features/traits of products by legal copyrights

• Satisfied customer: Brand represents values, ideas and even personality and hence leads to an assortment of memories in customers’ mind and hence satisfied customers.

• Means of Profits: Brands form the basis of purchase decision among consumers and thus are a means of financial profits.

Why brands matter

Customers use brands as a means to show “This is what I stand for” and hence, use brands to express themselves.

The customers remain loyal to brands and they become advocates for those brands.

Thus, you can see that people connect emotionally with brands that stand for things that are important to them.

Advantages of Strong Brands Improved perceptions of product performance Greater loyalty Less vulnerability to competitive marketing actions Less vulnerability to crises Larger margins More inelastic consumer response Greater trade cooperation Increased marketing communications effectiveness Possible licensing opportunities

Brand Elements Brand Names URLs Logos Symbols Characters Spokespeople Slogans Jingles Packages

Brand Element Choice Criteria

Memorable Meaningful Likeability Transferable Adaptable Protectible

• Memorable– Easily recognised– Easily recalled

• Meaningful– Descriptive– Persuasive

• Likable– Fun and Interesting– Rich visual and verbal imagery– Aesthetically pleasing

• Transferable• Adaptable• Protectable

Criteria for choosing Brand Elements

• Transferable– Within and Across product categories– Across geographic boundaries and cultures

• Adaptable– Flexible– Updatable

• Protectable– Legally– Competitively

Criteria for choosing Brand Elements

What makes brands great

• It is important that in order to make a strong impact, a brand should be strong. There are a few characteristics that make a ‘strong’ brand, which are as follows:

A strong brand is a major driver of shareholder value.

A strong brand is like an asset. It can be used as collateral for financial loans , buying and selling as an asset.A strong brand has strong attributes, values and personality that the consumers associate with the brand.A strong brand is a means of attaining higher customer loyalty.

What makes brands great A strong brand always delivers the benefits that

customers truly desire. A strong brand makes use of and coordinates full

range of marketing activities to build equity. A strong brand has the right blend of product quality,

design, features, costs and prices. A strong brand is properly positioned and occupies a

particular niche in consumers' minds. A strong brand compels consumers to willingly pay a

substantial and consistent premium price for the brand versus a competing product and service.

Relating Brand to Financial Value

Brand = overall image of

organization, product, service,

person, etc.

Image = composite of such things as name, trademark (logo), customer

loyalty, reputation, etc.

Valuable brands are said to have “brand equity,” or added value due to the

brand

Brand value = how much a buyer would pay to

acquire the brand; usually it is positively

influenced by brand equity

Financial Value of a brand

Most valuable brands 2015

• The term "Brand Value" is considered to be the net present value of the estimated future cash flows attributable to the Brand.

• The premium that accrues to a brand from customers who are willing to pay extra for it Brand Value is also referred to has Brand Equity.

• Brand value in the case of consumer product brands can be measured through customer loyalty, staff retention/recruitment.

• A company's brand value depends on its reputation

Elements and MeasurementBRAND EQUITY

Introduction

Brands have financial value because they have created assets in the minds and hearts of customer, distributors,

prescribers and opinion leaders.

Brand Equity When a commodity becomes a brand, it is said to have equity. The premium a brand can command in the market The difference between the perceived value and the intrinsic

value

Customer-Based Brand Equity It is the differential effect that brand

knowledge has on consumer response to the marketing of that brand

A positive CBBE means customers might be more accepting to the marketing activities (ie. the marketing mix) for a brand

Aaker’s Brand Equity Model

Aaker’s Brand Equity Model

Brand Equity Framework

Brand Equity

Brand Awareness

Brand Recall Brand Recognition

Brand Attributes & Associations

Uniqueness Favorability Relevance

Brand Loyalty Perceived Quality

• Brand Associations: Uniqueness

USP Unique Selling Proposition Product-related Image Related

Points of Difference - How brand is uniquePoints of Parity - How brand is similar to others

Brand Equity Framework

Brand Knowledge

Knowledge

Thoughts

Experiences

Beliefs Images

Feelings

27

CUSTOMER-BASED BRAND EQUITY PYRAMID

RESONANCE

SALIENCE

JUDGMENTS FEELINGS

PERFORMANCE IMAGERY

4. RELATIONSHIPS =

What about you & me?

3. RESPONSE =

What about you?

2. MEANING =

What are you?

1. IDENTITY =

Who are you?

28

Customer-Based Brand Equity Model

Consumer-BrandResonance

Brand Salience

Consumer Judgments

Consumer Feelings

BrandPerformance

BrandImagery

INTENSE, ACTIVE LOYALTY

RATIONAL & EMOTIONAL REACTIONS

POINTS-OF-PARITY &

POINTS-OF-DIFFERENCE

DEEP, BROAD BRAND

AWARENESS

Customer-Based Brand Equity Pyramid

• Brand Salience - How brand stands out from the rest (Prominence)

• Brand Performance - How product meets customers’ functional needs

• Brand Imagery - Strong, Unique Associations How brand meets psychological or social needs• Brand Judgments - Personal opinions & evaluations of

brand• Brand Feelings - Emotional responses to brand• Brand Resonance - Intense loyalty, Active involvement with

brand

Social Value of Brand • Defined as the extent to which people share a brand or

information about a brand as part of their everyday social lives at work or at home

• The more customers of one brand are interconnected, the more they are willing to pay for the product and the more loyal they are

• For users : Social brand value is the perceived value that results from the exchange and interactions among and between brand users within a community.

• For companies: The share of a brands equity which result from social interactions among brand users and which is not directly under the control of the company . Its the percentage of equity resulting from those interactions

Apple & Google have high social barnd value

Keys of Branding – building successful brands

• Create the right tagline. Spend a full day with three or four of your top team members talking about how you want to be perceived in public. What is the emotional reaction you want your audience to have when engaging the brand and what do you want them to remember? Develop your tagline based on this discussion.

• Stand out from the crowd. Think about who your audience is. What are your top competitors doing in terms of their site look and how they are expressing themselves? Look for some core commonalities, and simultaneously prepare to identify where you can innovate and differentiate.

• Develop your company culture. And then do all your hiring and your onboarding with this culture in mind. Don’t bring on people who could destroy client relationships you spent months or years to cultivate. Miller Felpax CEO, Steve Blue, points out in his book “The Ten Million Dollar Employee” that it only takes one customer’s bad experience with one bad employee to sabotage a multimillion-dollar investment.

Keys of Branding – building successful brands

• Be patient with your brand. Take on every new outreach initiative with care. Think of it as your baby. Just as you wouldn’t start feeding solid food to a 3-month-old, don’t rush any of your outreach activities, whether they be PR, advertising, or marketing materials.

• Be consistent. Think of your outreach as being interconnected, like a body. The brand is the brain. Public relations, advertising, marketing, and sales are all extensions of that brain, and they must be coordinated and aligned. The copy, design and language your team uses is must always be based off of the brand. If possible, don’t use multiple designers or multiple copywriters. Find people who capture the essence of your brand and use them consistently.

• Get help. Branding isn’t easy. If it were, there would be a much greater number of stronger brands in the small business community. The reason the Nike’s, Lexus’s, and Target’s of the world can have strong brands is because they have the dollars to spend on it. But they weren’t always conglomerates; if they can achieve brand success, so can you. First, you have to nail down step one: your brand! A professional can take you through the process so you see things more clearly, get a different perspective, and go about branding in a way that will allow you to reach your market more efficiently.

• Put people first. The brand is more than the company. It is the executive team’s and the individual employees’ personal brands as well. People do business with people. A strong CEO brand, executive brand, or personal brand helps build a positive reputation overall. Nearly everyone prefers working with businesses that are people-oriented and actually care about their customers. Be that company by embodying a people-first attitude in all that you and your employees do.

• Create the right tagline. Spend a full day with three or four of your top team members talking about how you want to be perceived in public. What is the emotional reaction you want your audience to have when engaging the brand and what do you want them to remember? Develop your tagline based on this discussion.

• Stand out from the crowd. Think about who your audience is. What are your top competitors doing in terms of their site look and how they are expressing themselves? Look for some core commonalities, and simultaneously prepare to identify where you can innovate and differentiate.

• Develop your company culture. And then do all your hiring and your onboarding with this culture in mind. Don’t bring on people who could destroy client relationships you spent months or years to cultivate. Miller Felpax CEO, Steve Blue, points out in his book “The Ten Million Dollar Employee” that it only takes one customer’s bad experience with one bad employee to sabotage a multimillion-dollar investment.

Five Key Brand Elements:• Brand PositionThe

Brand Position is the part of the brand that describes what your organization does and for whom, what your unique value is and how a customer benefits from working with you or your product/service, and what key differentiation you have from your competition. Once you've defined your brand position, make it available in 25, 50, and 100 word versions.

• Brand PromiseThe Brand Promise is the single most important thing that the organization promises to deliver to its customers—EVERY time. To come up with your brand promise, consider what customers, employees, and partners should expect from every interaction with you. Every business decision should be weighed against this promise to be sure that a) it fully reflects the promise, or b) at the very least it does not contradict the promise.

Five Key Brand Elements:• Brand PersonalityBrand Traits illustrate what the organization wants its brand to

be known for. Think about specific personality traits you want prospects, clients, employees, and partners to use to describe your organization. You should have 4-6 traits (5 is ideal), each being a single term (usually an adjective).

• Brand StoryThe Brand Story illustrates the organization's history, along with how the history adds value and credibility to the brand. It also usually includes a summary of your products or services.

• Brand AssociationsBrand Associations are the specific physical artifacts that make up the brand. This is your name, logo, colors, taglines, fonts, imagery, etc. Your brand associations must reflect your brand promise, ALL of your brand traits, and support your brand positioning statement.

Brand Halo • Halo effect – A single trait is used to form an overall

evaluation • The bias shown by customers towards certain products

because of a favourable experience with other products made by the same manufacturer or maker.

• Halo effect simply explains the biasness showed by customers to certain products or services based on some favourable or pleasant experience with some other products or services offered by the same manufacturer.

• Basically driven by brand equity

Brand Halo• Apple’s success of iPod iTunes, iPad etc • Apple introduced the iPod some years ago and it was creative in its

functions and design. Apple iPod introduced a gateway to novel thinking and extremely eye-pleasing experience for iPod users.

• The positive perception about Apple's iPod then had a positive effect on other Apple products. With the introduction of iPod, Apple noticed a high demand and increased sales for rest of their products.

• With the halo effect, a person uses just one dimension in evaluating a person, product, or service. For instance, a consumer might consider a clean waiting room as an indication of a good dentist. For this reason, marketers use the halo effect when licensing names of products or choosing spokespeople.

Line influence on growing brand• Brand and line extensions have become important means of growth for

companies that have strong brand names. There may be instances where brand managers have to choose between brand and line extension as the primary form of growth for the brand. In order to be able to choose the better alternative, brand managers need guidelines which relate consumers perceptions of the brands, in the form of brand associations, to decisions on line or brand extension.

• managers perceive extensions as a low-cost, low-risk way to meet the needs of various customer segments; line extensions can satisfy consumers’ desires by providing a wide variety of goods under a single brand; and managers often use extensions as a short-term competitive weapon to increase a brand’s control over limited shelf space.

• However, the costs of line extensions are dangerously high. The strategic role of each product, for example, becomes muddled when a line is oversegmented.