BRAND MANAGEMENT AND NEW PRODUCT DEVELOPMENT

SECTION 5Brand Management and the Firm

Brand Types and Characteristics

ALAN L. WHITEBREAD

THE FOUR STEPS OF BUILDING A BRAND

• Brand identity– Who are you? Steve Jobs oldie video– It should be positive, memorable, protectable, not

myopic or time-based, and transferable.

• Brand meaning– What are you?

• Brand response– How do I think or feel about you?

• Brand relationships– What type of a connection do we have?

BUILDING A BRAND

• BRAND IDENTITY FORMS– The corporate brand is the only brand name used

• Frequently seen in B2B

– The company and the brand are together• DuPont Teflon, IBM Blade Server, Philips, Siemens

– The combination brand by Company X• Product name by Company X [common in acquisitions]

– The individual/product brand with minor mention of Company X

• Clairol, Crest, Folgers, Noxzema, Pampers, Puffs, Tide – Proctor and Gamble

– The brand represented / distributed by X• A common practice in B2B [especially in resellers] especially

when they use “authorized”

TYPES OF BRANDS

GENERICPharmaceuticals, Vegetables

GENERICPharmaceuticals, Vegetables

+INDIVIDUAL / PRODUCTHuggies, P&G soaps, Crest

+INDIVIDUAL / PRODUCTHuggies, P&G soaps, Crest

CO-BRANDINGPost Oreo O’s cereal, Disney SUV

INGREDIENT BRANDINGIngredient name + brand name

NutraSweet diet drinks, Dolby sound system

CO-BRANDINGPost Oreo O’s cereal, Disney SUV

INGREDIENT BRANDINGIngredient name + brand name

NutraSweet diet drinks, Dolby sound system

+CORPORATE / FAMILY Nike, IBM, GE, RCA

+CORPORATE / FAMILY Nike, IBM, GE, RCA

PRIVATE LABELKenmore, Craftsman, Die-Hard

Great Value, …

PRIVATE LABELKenmore, Craftsman, Die-Hard

Great Value, …

+COMBINATIONHP Deskjet, DuPont Stainmaster

+COMBINATIONHP Deskjet, DuPont Stainmaster

BRAND LICENSEDisney

BRAND LICENSEDisney

PRIVATE LABEL BRANDS

Are generally a threat only to brands that are 1. Overpriced

The value equation is wrong because the real or perceived benefits are not sufficient.

2. Under-supportedVery small IMC relative to what is needed to build or sustain a

brand.

3. Undifferentiated Very poor differentiation [if any] and probably some

combination of bad POP, IMC, …

PRIVATE LABELS: SOME DISHWASHERS

Maytag®

AdmiralJenn-Air®

Jenn-Air Pro-Style®

Magic ChefMaytag Jetclean®IIIMaytag Jetclean®IIMaytag Jetclean®

NorgeHardwick

GE®

GE®

GE ProfileTM

GE SpacemakerTM

Hotpoint®

GE Monogram®

Kenmore

Electrolux®

Electrolux IconGibson

KelvinatorWhite-Westinghouse

FrigidaireFrigidaire Gallery

Frigidaire ProfessionalTappan®

GEKenmore

Whirlpool®

Roper®

Estate®

Whirlpool®

Whirlpool Gold®

KitchenAid®

KitchenAid BRIVA®

[In-sink dishwasher]

KenmoreKenmore Elite

Kenmore UltraWash®

See http://www.ajmadison.com/cgi-bin/ajmadison/item_list/cat00263/Built_In_Dishwashers.html for more.See http://www.appliance.com/dishwashers/list.html for a list of firms.

PRIVATE LABEL BRANDS

• PRIVATE LABEL NOTES– Some people differentiate a private label brand as

one that identifies the source of the product and a generic brand as one that does not identify the source. [honey at Wal-Mart]

– Private labels are called store brands for retailers.

– Private labels for wholesalers and distributors may or may not have detailed specifications and may or may not identify the source of the product.

BUILDING A BRAND

• PRIVATE LABEL BRANDS– Manufacturer’s brands [OEM]

• Manufacturer A makes products for Manufacturer B so the market believes Manufacturer B is making the products.

– ?

– Reseller’s brands• B2B

– Nearly all mail order firms

• B2C– Sears Craftsman tools, DieHard batteries, and Kenmore

appliances / almost all retailer brands

BUILDING A BRAND

• PRIVATE LABEL BRANDS– Counter brands or Generic brands

• Usually the same ingredients as the major brand and imitates it in nearly all aspects – same size package, information is identical and in the same place, etc.

– Wal-Mart Equate brand

– Fakes or Knock-offs• Illegal versions of usually major brands

– CDs, movies, software, …– CBP video

B2B BRANDS

• Most are unknown by the average consumer.– Known: Alcoa, Intel, – Unknown: FMC, Lexan, TIVAR

• Important considerations– Company reputation and financial stability– Capacity, flexibility, service level[s] – NPD

POSITIONING: BRAND IDENTITY

• Vision [includes purpose / need fulfillment]• What makes it different?• What makes it recognizable?

– This is a part of but not the same as identity– As seen from sender’s side!

• Sight– Graphic symbol [logo]

• Sound– Name

• Slogan or tag line• Must penetrate the noise.

BRAND IDENTITY TRAPS

• Each of these approaches is too limiting or tactical.

BRAND IMAGE[tactical]

BRAND IDENTITY

[strategic]

BRAND POSITION

[enduring]

How the brand is currently perceived

[The customer determines who you are]

How we want the brand to be perceived

[Must be a visionary positive projection]

The part of the brand identity and value proposition that is communicated to the target audience.

[a focus on attributes [features] restricts the brand identity]

POSITIONING: BRAND IMAGE

• Brand image [as seen from receiver’s side]– Perceptions of the product– Must not be distorted by the noise– If you are doing a great communications job,

brand image will be very close to the brand identity.

– Understanding the receiver’s side• Use a Mental map / Mind map

– A graphical technique that takes advantage of the brain’s

associative capability not just is linear capability.– Tony Buzan Mind Map [Concept Mapping] video

MIND MAP

7-Up

Sweet

Sticky

Children

Bittersweet

Lemon

Adult

Fresh

Thirst quencher

Carbonated

Sparkling

Cool

Do run-flat tires as a quick one as a class exercise.http://www.autoevolution.com/news/michelin-tweel-airless-tires-production-starts-will-motorcycles-get-them-video-89369.html#

REMEMBER THE BENEFITS OF STRONG BRANDS

• Increased customer loyalty

• Increased brand recognition

• Stronger competitive position

• Larger gross and pre-tax margins

• Increased trade cooperation [channel strength / channel members]

• Increased IMC effectiveness

REMEMBER – STRONG BRANDS PROVIDE POTENTIAL FOR

• a corporate brand

• brand extensions

• product line extensions

• licensing and / or franchising

POSITIONING: FIRST STEPS

• Four key questions must be answered before you begin to evaluate positioning alternatives.– Why does the brand exist?

• Brand identity

– Who is the brand for?• Market segmentation; market profiles [descriptions]

– Why are the benefits meaningful?• Market research to determine rank order

– What are we competing against?• SWOT analysis; competitive analysis; product charts

POSITIONING: FIRST STEPS

• Why does the brand exist?– The brand vision [brand promise for the consumer].

• NIKE– “self-realization through exercise” → I care about doing

my best

– Brand benefits must be rank ordered by perceived value for each target market [segment].

• Who is the brand for?– Precise market segmentation and target marketing

are required.

POSITIONING: FIRST STEPS

• Why are the benefits meaningful?– What proof exists?– Are they in rank order starting with the most important?– How are the benefit messages conveyed?

• What are we competing against?– You must understand the nature of competition.

• By level [direct, various indirect]• By product for direct competitors• By company [by probability of competing and how they

compete]• By substitute products

SELECTING BRAND ELEMENTS

• Six criteria should be used to do this.1. Memorable: easy to recognize and recall

2. Meaningful / descriptive / interesting / rich in visual and verbal imagery

3. Likeable aesthetically and emotionally

4. Transferable within and across product, geographic, or cultural boundaries

5. Adaptable, flexible over time to keep from becoming stale or outdated

6. Legally and competitively protectable [IP]

A SUCCESSFUL BRAND

• When you have positioned a brand correctly, it has all of the following characteristics.– Recall [physically, imagery, familiarity]– Personality [character]– Culture [group]– Relationship [meaning to the customer]– Customer reflection [perception]– Self-image

POSITIONING: BRAND IDENTITY

• Vision [includes purpose / need fulfillment]• What makes it different?• What makes it recognizable?

– This is a part of but not the same as identity– As seen from sender’s side!

• Sight– Graphic symbol [logo]

• Sound– Name

• Slogan or tag line• Must penetrate the noise.

BRAND RECOGNITION QUIZ - #2

for extra test points13+ = 5 10-12 = 4 7-9 = 3 4-6 = 2 <4 = 1 point[s]

Take out a sheet of paper.Print your name at the top.Number the rows from 1 through 15.Print your answers for each of the following on the correct line.

Major brand or company names only. No product names.

NAME THE BRANDS

1 2

3 4

NAME THE BRANDS

5 6

7 8

What can brown do for you?

NAME THE BRANDS

9 10

11 12

Deep green industrial products

Paper and medical products and a red logo

Bright red retail store Mustard yellow heavy industrial products

NAME THE BRANDS

13 14

15

Bright orange retail store Robins egg blue box

Logo in a bright red ball

NAME THE BRANDS

1 2

3 4

Ferrari Nabisco or Oreo

Burger King Mars candies

NAME THE BRANDS

5 6

7 8

What can brown do for you?

Starbucks Nike

UPS McDonald’s

NAME THE BRANDS

9 10

11 12

Deep green industrial products

Paper and medical products and a red logo

Bright red retail store Mustard yellow heavy industrial products

Target Caterpillar

3M Corporation John Deere

NAME THE BRANDS

13 14

15

Bright orange retail store Robins egg blue box

Logo in a bright red ball

Home Depot Tiffany

Coca-Cola