chapter 1
DESCRIPTION
KellerTRANSCRIPT
1
STRATEGIC BRAND MANAGEMENT
BUILDING, MEASURING, AND MANAGING BRAND EQUITY
Kevin Lane Keller
2
What is a Brand? American Marketing Association’s definition
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.
Attributes that identify the brand are called – Brand Elements (based on people, place, objects, animals, etc.)
Practicing managers define brands as more than that. This distinction is important since it can lead to confusion.
What is a Brand?Brand versus Product – Product – is anything that can be offered to a
market for attention, acquisition, use or consumption that may satisfy a need or a want (goods, services, retail store, person, organization, idea)
Kotler defines 5 levels of a product1. Core benefit level – fundamental need or want that
is satisfied2. Generic product level – basic version – attributes
necessary for functioning (stripped down level)3. Expected product level – what customer’s
normally expect 4. Augmented product level – additional attributes,
benefits that distinguish it from competition5. Potential product level – all transformation that it
might undergo in the future
What is a Brand?A Brand is therefore a Product – that also has
dimensions that differentiates it from other products designed to satisfy the same need (competition)
Differences may be - Rational and tangible – related to product performance
(3M, Sony, Gillette) Symbolic, emotional, intangible – related to what the brand
represents (Coca Cola, Calvin Kline, Marlboro)
What distinguishes a brand from a commodity gives it equity - the sum total of consumer perceptions and feelings about how it performs (3M, Sony, Gillette)
The name and what it stands for The company associated with the brand
New Concept of Brand Equity (BE)
BE is defined differently by many but there is a point of consensus. It is agreed that -
BE relates to marketing effects that are uniquely attributable to the brand BE 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.
BE concept in marketing - stresses the importance of the brand in marketing strategies.
New Concept of Brand Equity
There is also agreement about - Branding is about creating differences Differences in outcome - arise from ‘added
value’ endowed to a product as a result of past marketing activities for the brand
This value can be created for a brand in many ways
Brand value can be exploited to benefit of the firm in many different ways
BE provides the common denominator for interpreting marketing strategies and assessing the value of the brand
Why Brands Matters?
Brand Value created translates to financial profits for the firm as:
Creates perceived differences through branding
Develops a loyal consumer franchise
The brand is an intangible valued asset that needs to be handled carefully.
Why Brands Matter Customers
Risk reducer Search cost reducer Signal of quality Symbolic device for self expression Promise, bond, pact, with maker of the product Means of identification of source of product for assignment of
responsibility to product maker
Manufacturer Means of identification for handling, tracing Signal of quality level to satisfied customers Competitive advantage Financial return Legal protection of unique features
Why Brands Matter It creates a relationship between brand and consumer
a bond / pact. trust and loyalty and in return ……. expect consistent product performance, appropriate price, distribution
and other actions Brands take on a special meaning and change the
experience and perception of a product that leads to greater satisfaction
Customers with past experience learn more about the brand The advantages
Lowers search cost internally and externally The value may not be only functional in nature They are symbolic devices allowing them to project their self image Extremely important with credence goods to signal quality Brands reduce risk particularly in BtoB settings
10
Benefits of Customer-Based Brand Equity
Branding is a powerful means of securing a competitive advantage
Brand experience can last for years and cannot be duplicated
Enjoy greater brand loyalty, usage, and affinity
Predictability and security of demand Command larger price premiums on a regular basis, also during
A&Ms Creates entry barriers for others Receive greater trade cooperation & support Increase marketing communication effectiveness Yield licensing opportunities Support brand extensions
Anything Can Be Branded
Branding is possible for - B to B products High-tech products Services Retailers and Distributors Online products and services People and Organizations Sports Arts, Entertainment Geographic location Ideas and causes
Anything Can Be Branded
To brand a product what needs to be done is -Consumer has to be Taught to identify the brand – label, name and
other elements Learn the brand meaning - functional, emotional
and symbolical Know the brand difference from other similar
product brands (performance / image and non-product related considerations)
Commodities have been branded – atta, salt
13
Determinants of Customer-Based Brand Equity
Customer is aware of and familiar with the brand
Customer holds some strong, favorable, and unique brand associations in memory
14
The Concept of CBBE and Marketing
Customer-based brand equity - creates Differential effect of brand because of … Customer brand knowledge…which
generates Customer response to brand marketing
15
Brand Equity and Marketing Management
BE concept stresses - importance of the brand in marketing strategies
BE 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.
16
Building Customer-Based Brand Equity
Brand 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 it
Other associations indirectly transferred to the brand by linking it to some other entities
17
The Key to Successful Branding
For branding strategies to be successful – Consumers must be convinced that
there are meaningful differences among brands Consumer must not think that all brands in
the category are the same.
PERCEPTION = VALUE
18
Customer-Based Brand Equityas a “Bridge”
CBBE represents the “added value” endowed to a product as a result of past investments in the marketing of a brand.
CBBE therfore provides direction and focus to future marketing activities
19
Strategic Brand Management
Strategic brand management involves design and implementation of marketing programs and activities
to build, measure, manage BE
Strategic brand management process involves four main steps:1) Identify and establish brand positioning and values2) Plan and implement brand marketing programs3) Measure and interpret brand performance4) Grow and sustain BE
20
Strategic Brand Management Process
Mental mapsCompetitive frame of referencePoints-of-parity and points-of-differenceCore brand valuesBrand mantra
Mixing and matching of brand elementsIntegrating brand marketing activitiesLeveraging of secondary associations
Brand Value ChainBrand auditsBrand trackingBrand equity management system
Brand-product matrixBrand portfolios and hierarchiesBrand expansion strategiesBrand reinforcement and revitalization
KEY CONCEPTSSTEPS
Grow and SustainBrand Equity
Identify and EstablishBrand Positioning and Values
Plan and Implement Brand Marketing Programs
Measure and InterpretBrand Performance
21
New Branding Challenges
Brands are important as ever Consumer need for simplification Consumer need for risk reduction
Brand management is as difficult as ever Savvy consumers Increased competition Decreased effectiveness of traditional
marketing tools and emergence of new marketing tools
Complex brand and product portfolios
22
The Customer/Brand Challenge In this difficult environment, marketers
must have a keen understanding of: customers brands the relationship between the two