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M. Ali Umar Ismail Niken Ayu M.Metta Yunita Nikolas SimamoraMohamad Mahi Riris Kristina S.

Building Brand Equity andBrand Identity

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Designing Marketing Programs

to Build Brand Equity

Keller, Chapter 5

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Overview

How do marketing activitiesalso product, pricing, and

distribution strategiesbuild brand equity?

How can marketers integrate these activities to enhancebrand awareness, improve brand image, draw positive brand

responses, and increase brand resonance?

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New Perspective on Marketing

Changes: Economic Technology

Politic Legal Sociocultural Competitive

environments

4 Major drivers of new

economy: Digitization and

connectivity Disintermediation and

reintermediation Customization and

customerization Industry convergence

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Integrating Marketing Programs and

Activities

There are many different means by which products and

services and their corresponding marketing programs can

build brand equity.

Creative and original thinking is necessary to create fresh

new marketing programs that break through the noise in the

market place to connect with customer.

However creativity must not sacrifice a brand-building goal,and marketers must orchestrate programs to provide

seamlessly integrated solutions and experiences for

customers that create awareness, spur demand, and cultivate

loyalty

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Personalizing Marketing

To adapt to the increased customer desire for personalization, marketers have

embraced concepts such as experiential marketing, one-to-one marketing, and

permission marketing.

Experiential Marketing

It promotes a product by

not only communicating a

products features and

benefits but also

connecting it with uniqueand interesting

experiences.

One-to-one Marketing

Consumers help to add

value by providing

information to marketers;

marketers add value, in

turn, by taking thatinformation and

generating rewarding

experiences for

consumers.

Permission Marketing

The practice of marketing

to consumers only after

gaining their express

permission.

Consumers appreciate

receiving marketing

messages they gave

permission for.

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Experiential Marketing

Focuses on customer experiences

Focuses on the consumption situation

Views customers as rational and emotional elements

Uses electric methods and tools

There are 5 different types of experiences: Sense, Feel, Think,

Act, and Relate. They are becoming increasingly vital toconsumersperceptions of brands.

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One-to-one Marketing

Based on several fundamental strategies:

Focus on individual consumer through consumer database

Respond to consumer dialogue via interactivity

Customize products and services.

Treat different consumers differently:

Different needs

Different current and future value to the firm

Devote more marketing effort to most valuable consumers.

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Permission Marketing

Getting permission with inducement such as freesample, discount, sales promotion, contest, etc.

Marketers might develop stronger relationships withconsumerdesire to receive further communicationrelationship can be develop if marketers respect consumers

wishes and of consumers express a willingness to become

more involved with the brand.

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Permission Marketing

5 steps to effective permission marketing:

Offer the prospect an incentive to volunteer.

Offer the interested prospect a curriculum over time, teaching

the consumer about the product or service being marketed. Reinforce the incentive to guarantee that the prospect

maintains his or her permission.

Offer additional incentives to get more permission fromconsumers.

Over time, leverage the permission to change the consumerbehavior toward profits.

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New Marketing Approach

Product Strategy

Perceived Quality and Value

Relationship Marketing

Pricing Strategy

Consumer price perception

Setting price to build brand equity

Channel (distribution) strategy

Channel design

Indirect channels

Direct channels

Web strategies

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Product Strategy:

Perceived Quality and Value

Consumers formed their opinions about quality based on

following dimensions: Performance, Features, Conformance

Quality, Reliability, Durability, Serviceability, Style and

Design.

Brand intangibles: product quality depends not only on

functional product performance, but on broader performance

consideration (performance/process/relationship benefits).

Value chain: by improving performance and reducing cost in

value-creating activities, a firm can achieve competitive

advantage.

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Product Strategy:

Relationship Marketing

Based on premise that current customers are the key to long termbrand success.

Mass Customization: technology helps producer to be able to make

customized product for mass market, e. g. Dell Computers.

Aftermarketing: Establishing and maintaining a consumerinformation file, buleprinting consumer contacts, analyzingcustomer feedbacks, conducting CS surveys, formulating andmanaging communication programs, hosting special customer

events/programs, identifying and reclaiming lost customers.

Loyalty programs: identifying, maintaining, and increasing the yieldfrom firms best customers through long term, interactive, valueadded relationships.

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Pricing Strategy

Consumer Price Perseptions

How the consumers categorize the price of the brand (as low,

medium, or high), and how firm or how flexible they thinkthe price is, based on how deeply or how frequently it is

discounted. Consumer often rank brands according to price

tiers in a category.

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Pricing Strategy:

Setting Prices to Build Brand Equity

Value Pricing: to uncover the right blend of product quality,product costs, and product prices that fully satisfies theneeds and wants of consumers and the profit targets of thefirm.

Strong brand can command price premiums, but strong brandscant command an excessive price premiums.

Effective value pricing strategy should strike the proper balanceamong the following:

product design and delivery,

product costs,

product prices.

Everyday low pricing: avoids pattern of alternating priceincreases and decreases.

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Channel Strategy

Channel: sets of interdependent organizations involved in the

process of making a product or service available for use of

consumption.

Channel strategy includes the design and management of

intermediaries such as wholesalers, distributors, brokers, and

retailers.

Channel designs:

Direct channel,

Indirect channel,

Web strategies

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Channel Strategy:

Indirect Channel

Sell products through third-party intermediaries such as agents or brokerrepresentatives, wholesalers or distributors, and retailers or dealers.

Push and pull strategies: providing incentive to retailers to stock andsell some products (push), or create such a demand from consumer

that consumer requests retailers to sell the product (pull).

Channelsupport: a number of different services provided by channelmembers can enhance the value to consumers of purchasing andconsuming a brand name product.

Retailsegmentation: retailers are customers too, and they aresegmented due to different capabilities and needs. They need to betreated differently to get necessary brand support.

Cooperativeadvertising: manufacturer pays for a portion of theadvertising that a retailer runs to promote manufacturersproduct andits availability in the retailers place of business.

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Channel Strategy:

Direct Channels & Web Strategies

Direct Channels:

Selling through personal contacts from the company to

prospective customers by mail, phone, electronic means, in-person visits, and so forth.

Company-owned stores: made to gain control over the sellingprocess and build stronger relationships with customers.

Web Strategies:Using the advanced technology, many manufacturers can have

an online retai