CHAPTER SEVENTEEN Strategic Launch Planning 1 Branding March 13, 2007.
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Transcript of CHAPTER SEVENTEEN Strategic Launch Planning 1 Branding March 13, 2007.
The Value of a Strong Brand
“Brand equity has just as much effect
on stock price as do earnings.”
—David AakerProfessor of Marketing, EmeritusUniversity of California, Berkeley
What is a Brand?
A product is something that is made in a factory; a brand is something that is bought by a customer. A product can be copied by a competitor, a brand is unique. A product can be quickly outdated; a successful brand is timeless.Source: Stephen King, WPP Group, London
A brand is something that resides in the minds of consumer.
A brand is a “name, term, sign, symbol, or design, or a combination of them intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competition.” Source: American Marketing Association
What is a Brand?
Name
Term
Sign
Symbo
l
Design
Combination
Identifies product/service
of seller anddifferentiates from
competitors
Keller, Kevin Lane. Strategic Brand Management: Building, Measuring, and Managing Brand Equity. 1998.
Benefits of Brands Consumers
Identification of the source of product Assignment of responsibility to product maker Risk reducer Search cost reducer Promise, bond, or pact with maker of product Symbolic device Signal of quality
Benefits of Brands (cont.) Manufacturers
Means of identification to simplify handling or tracing
Means of legally protecting unique features Signal of quality level to satisfied
customers Means of endowing products with unique
associations Source of competitive advantage Source of financial returns
A Brand is More Than a Product
Product
Scope
Attributes
Uses
Quality/value
Functional benefits
Organizational associations
Brand
Personality
Symbols
Self-expressive
benefitsEmotional benefits
User Imagery
Country of origin
Brand
Brand/customer relationships
What is Brand Equity?
What distinguishes a brand from its unbranded commodity counterpart and gives it equity is the sum total of consumers’ perceptions and feelings about the product’s attributes and how they perform, about the brand name and what it stands for, and about the company associated with the brand.
Source: Alvin A. Achenbaum, “The Mismanagement of Brand Equity, 1993
Brand Equity as a Percent of Firm Tangible Assets
Industry Brand Equity
Apparel 61Tobacco 46Food Products 37
Chemicals 34Electric machinery 22
Transportation 20Primary metals 01
Picking Stocks
Suppose that you will be given 0.1 percent of the stock on one of the following companies. Which firm’s stock would you prefer, given the following information?
General Motors $166B $229B $7B
Coca-Cola $19B $17B $4B
Sales Assets Profits
Brand EquityBrand Equity
Perceived Brand Quality
BrandAwareness• Brand Name• Symbols
BrandLoyalty
OtherProprietaryBrand Assets•Patents•Trademarks•Channel relationships
Brand Associations• Personality• Benefits• Attitudes
Provides Value to Customerby Enhancing:• Interpretation/processing of information• Confidence in the Purchase Decision• Use Satisfaction
Provides Value to Firm by Enhancing:• Efficiency and Effectiveness of Marketing Programs• Brand Loyalty• Prices/margins• Brand extensions • Trade Leverage• Competitive Advantage
What is Brand Equity?
Source: Aaker (1991) “Managing Brand Equity”Source: Aaker (1991) “Managing Brand Equity”
Brand personality
Describe the personality of the following: Arizona Iced Tea Intel Blockbuster Video Wal-Mart Toyota Dr. Pepper Aquafina Seiko Texas Instruments Nordstroms
Brand personalityWhat personality characteristics come to mind for the
following: Brand is repositioned several times or changes its
slogan repeatedly Brand uses continuing character in its advertising Brand charges a high price and uses exclusive
distribution Brand frequently available on deal Brand offers many line extensions Brand sponsors show on PBS or uses recycled
materials Brand features easy-to-use packaging or speaks at
consumer’s level in advertising Brand offers seasonal clearance sale Brand offers five-year warranty or free customer hot
line
Brand Equity
Sources of Brand Knowledge Brand Awareness Brand Image
Strength of Brand Associations Favorability of Brand Associations Uniqueness of Brand Associations
Why Extend a Brand?
Immediate brand awareness Transfer existing associations Faster trial Reinforce core brand
Questions and Guidelines in Brand Name Selection
Question GuidelineWhat is the brand's role or purpose? If the brand is to aid in positioning, choose a brand
name with meaning (DieHard, Holiday Inn). Ifpurely for identification, a neologism (made-upword) such as Kodak or Exxon will work.
Will this product be a bridgehead to a line ofproducts?
If so, choose carefully so as not to be a limitation inthe future (Western Hotels changed name toWestern International, then finally to Westin.)
Do you expect a long-term position in the market? If not, a dramatic, novelty name might be useful(such as Screaming Yellow Zonkers).
Is the name irritating or insulting to any marketsegment?
Women found Bic's Fannyhose to be objectionable.
Figure 17.8
Crapsy Fruit French cereal Fduhy Sesane China Airlines snack foodMukk Italian yogurtPschitt French lemonadeAtum Bom Portuguese tunaHappy End German toilet paperPocari Sweat Japanese sport drinkZit German lemonadeCreap Japanese coffee creamerI'm Dripper Japanese instant coffeePolio Czech laundry detergentSit & Smile Thai toilet paperBarf Iranian laundry detergent
Some Brand Names That Didn’t WorkFigure 17-9
How Brand Equity Provides Value
HighBrand
Loyalty
Other BrandAssets
More/BetterBrand
Associations
HighPerceived
Quality
HighBrand
Awareness
Reduced marketing costs
Increased trade leverage
Patents or trademarks
Strong channel relationships
Creates positive image
Helps customer process information
Supports quality positioning
Supports higher-price strategy
Easier to make brand associations
Increased liking and familiarity
Provides value to customer:Assists in customer information processingIncreases confidence in purchaseIncreases satisfaction in product use
Provides value to firm:Increases effectiveness of marketing programsIncreases customer loyalty and trade leverageFacilitates brand extensionsIs a source of competitive advantage