New Strategic Brand Management Chapter 2-3

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<p>Chapter 2 &amp; Chapter 3</p> <p>https://www.youtube.com/watch?v=By9m3UBiRZM</p> <p>Chapter 2 &amp; Chapter 3Preston and Snow</p> <p>Chapter 2: Strategic Implications of BrandingWhat does branding really mean?</p> <p>Branding transforms the product categoryHow does the brand do this?Brands organize the marketGives the products their own identityA brand is weak when products are transparent(Coke keeps its recipe secret)</p> <p>A brand is a long term visionBrands are not just about market share, but shape product categoryBrands hold certain positions in product categoryWhat would the market last if we did not exist?Strategy is needed to unite the brandWhat is the brand vision?What are the core values?</p> <p>Permanently nurtures the differenceBrands protect the innovatorsGrants exclusivenessRewards risk-taking attitude</p> <p>Brands act as a genetic programServes as the memory and the futureActs like fast-setting concrete</p> <p>Respect the brand contractBrands are built through a consistent messageOnce established, customers use brands as a benchmarkSatisfied customers become loyal customersBrand requirements:Forecast the needs and expectations of potential buyersReact to technical and technological progressProvide product/service quality and quantity simultaneouslyControl supply quantity and qualityDeliver products to distributorsGive meaning to the brand and communicate it to consumersIncrease the experience of consumption or interactionRemain ethical and ecology-conscious</p> <p>Halo Effect</p> <p>https://www.youtube.com/watch?v=fxyAYTieXlQ</p> <p>The product and the brand</p> <p>Halo effect: Kernel and Peripheral valuesHow does a brand have influence?Cue Messages:Search cues: factors readily accessible (price, label information)Experience cues: sample the product or serviceCredence cues (aka belief cues): long term fulfillment of promisesInfluence buyers if:Immediately availableFirmly believedHighly valuedHighly differentiated</p> <p>Halo effect: Kernel and Peripheral valuesKernel TraitsUnconditional, signify the brandIf the brand does not have X or Y, is it still the brand?Peripheral TraitsConditional, depends on the product range or segmentSamsung products differ depending on what category theyre inLong term may become kernel traits </p> <p>Brands need a flagship productPrototype productSpecific product most representative of the brandReveals direction and focuses brandProblems arise when products are too similar</p> <p>Advertising products through the brand prismBrands can guide perceptions like a magnifying glassProducts can reflect like a prism to help build the brandDetails change the picture depending on how they are presentedVolvo and BMW would promote ABS differently to fit their strategies</p> <p>Brands versus other signs of qualityBrands often coexist with other signs of qualityThis promotes and protects the brandCertifications of origin protect the heritage of the brandQuality seals act as a promotional tool</p> <p>Obstacles to the implementation of brandingBranding is a long term process requiring repetition and consistencyCorporate accounting is often short termFocus on the bottom line and ROIFast measurable results are preferredTurnover with agencies and within brands results in new directionsInnovations quickly become the status quo</p> <p>Asias branding cultureParadoxicalAsian brands enjoy high market share, but are not intrinsically desiredAsians have a love affair with brands, but mostly Western brands (fashion and luxury)SamsungSuccessful but needs more brandingFocus on products, not brandInnovations are not disruptiveNo capitalization, just distributionHighly centralized management and communication</p> <p>SummaryTime is often overlooked, but pivotalThe brand needs focusSay no to products that change the brandThe essence of the brand creates isA flagship product embodies the idea of the brandKernel traits identify products within the brandBrands guide perceptions and promote products</p> <p>Chapter 3: Brands and business models</p> <p>Are brands for all companies?YESAn instrument for growth and profitabilityEssentially another business tool</p> <p>The benefits of being a brandBrands lend personality, influence, value, and innovation that forms a communityEnhance exclusivityAct as a springboard for diversificationMagazines are a great exampleVogue, Elle, GEO, etc.</p> <p>Differentiating a commodity by the brandA commodity market is runs on optimal price aloneConsumers pay for the value of the goodLong term differentiation between products suffersHints of classical liberalismBrands disrupt the commodity marketPerception of brand product having more valueExamples: Coke, Evian</p> <p>Yello</p> <p>Yello Strom has developed a meter that makes electricity visible and offers customers an entirely new transparency around their energy consumption.</p> <p>Yello</p> <p>Building a market leader without advertisingBrand needs to do the followingHave enough volume/sufficient supplyHave a stable quality to reduce riskHave a mainstream priceBe end-user drivenCreate barriers to entry for other brandsHave a strong national sales force</p> <p>Example: Jacobs Creek Wine</p> <p>Jacobs Creek Winehttps://www.youtube.com/watch?v=STnrf0w33wg</p> <p>Brand building: From product to values, and vice versaFrom product to valueFocus on product attributesStarting point for most goodsAs the product becomes more recognized, the name gains attentionFrom value to productFocus on the name behind the productStarting point for luxury and licensed goodsInitially name alone is worth the money, but the product needs to supportBrand names are important and should NOT be descriptiveDescriptive becomes generic, and the brand is lost</p> <p>Are leading brands the best products or best value curve? Whats a value curve? Paradox that the number one brands are not the best productsValue curve: what does it mean to be the best?Meet the needs of consumers in the best way possibleHave added intangible values, such as personalityBacardi: easy to mix, appeals to casual partygoersBREAK THE RULE AND ACT FASTStrong brand awareness is enough to catch the attention of consumers unaware of product differences</p> <p>What to learn from branding and the value curve?Starting a brand means finding a disruptive innovationCreating a market is the best way to lead the marketWinners start first and move fastReach critical size rapidlyFocus on the customers values</p> <p>Example: Insead MBA</p> <p>Backing the brand by a business modelCompetition between brands is often a competition between business modelsTo grow through expansion, strategy relies on three factorsAvailabilityAccessibilityAttractiveness</p> <p>Case StudyThe Cola Wars: Coke vs. PepsiCoke:Put Coke at arms reachAble to be sold cheaply, at the same price as tea in the EastCokes image is not a product, but a bondPepsi ChallengedCheaper to consumersFocus on the product: better taste and started line extensionsImage was for the new young generationVirgin Cola FailureDidnt have the distributionOnly one core product with no portfolio for supportSmall sales force</p> <p>SummaryBrands are necessary for all companies and productsBrands foster differentiation in the marketBranding can be a chicken or egg debate: product or value?Either way you get a chickenThe value curve identifies the best brandBrand competition is often business model competition</p> <p>QuestionsThank you</p>