MSCA- Product and Brand MBA 2011-13

8/11/2019 MSCA- Product and Brand MBA 2011-13

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MBA 2011-13PRODUCT AND BRAND STRATEGIES

Dr. R.VENKATESHALLIANCE UNIVERSITY

MMBA


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Three basic elements of the product

product attributes

product benefits

marketing support services


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Characteristics of PLC and the implications for strategy

PLC and product policy

Product mix and product line Product as a strategic variable


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Life cycle of an industry

o Introduction

o Growth

o Maturityo Decline

Emphasis on strategies, functional areas, value-creating activities, and overall objectives variesover the course of an industry life cycle


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Adapted from Exhibit 5.8 Stages of the Industry Life Cycle


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Genericstrategies

Differentiation Differentiation Differentiation Overall costOverall cost leadershipleadership Focus

Market

growth rate

Low Very large Low to Negative

moderate

Number ofsegments

Very few Some Many Few

Intensity ofcompetition

Low Increasing Very intense Changing

Emphasison productdesign

Very high High Low to Lowmoderate

StageIntroduction Growth Maturity Decline

Factor


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Emphasison processdesign

Low Low to High Lowmoderate

Major

functionalarea(s) ofconcern

Research and Sales and Production General

Development marketing managementand finance

Overallobjective

Increase Create Defend Consolidate,market share consumer market share maintain,

awareness demand and extend harvest, or product life exitcycles

Stage

Factor

Introduction Growth Maturity Decline


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Products are unfamiliar to consumers

Market segments not well defined

Product features not clearly specified

Competition tends to be limited

Strategies

Develop product and get users to try it Generate exposure so product becomes

standard


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Characterized by strong increases in sales

Attractive to potential competitors

Primary key to success is to build consumer

preferences for specific brands

Strategies

Brand recognition

Differentiated products

Financial resources to support value-chain

activities


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Aggregate industry demand slows

Market becomes saturated, few new adopters

Direct competition becomes predominant

Marginal competitors begin to exit

Strategies

Efficient manufacturing operations and processengineering

Low costs (customers become price sensitive)


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Industry sales and profits begin to fall

Strategic options become dependent on theactions of rivals

Strategies

Maintaining

Exiting the market

Harvesting

Consolidation


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Asset and cost surgery

Selective product and market pruning

Piecemeal productivity improvements


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Dalr ymple & Parsons/Marketing Management 7th edition: C hapter 7 3

A Brand is a ..A Brand is a ..

Name,

Term,

Sign,

Symbol, or

Design .

intended to

distinguish the

goods and services

from one another


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Brand equity: The goodwill (equity) that anestablished brand has built up over itsexistence.

DREK -- differentiation, relevance (strength)

-- esteem, knowledge (stature)

Brand concept: specific meaning that brand

managers create and communicate to thetarget market.

Brand concept management: the analysis,planning, implementation, and control of a

brand concept throughout the life of the


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Brand naming criteria

Commonly used research approaches

to determine brand meaning:o Word associations

o Personifying thebrand

o

Laddering up thebrand essence Brand essence

Laddering up

o Brand bonding (through experience)


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o Brand building tools

Public relations andpress releases

Sponsorships Clubs and consumer

communities

Factory visits

Trade shows

Event marketing

Public facilities

Social causemarketing

High value for

the money

Founders or acelebrity personality

Mobile phone

marketing


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Nikes arrangement with Michael Jordan

has provided an excellent example of a

celebrity endorsement. Can you think of

an endorsement campaign that backfired?

What did it cost the company

in the short term? What,if any, have been the

lasting effects?


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Advantages of Branding Consumers viewpoint

1. Product quality

2. Increased shopper efficiency

3. Calls attention to new products4. Reduces psychological risk

Sellers viewpoint1. Handling orders, tracking down problems

2. Trademarklegal protection

3. Brand loyalty

4. Reduces need for in-store contact

5. Facilitates segmentation, promotion, and pricing


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Branding Challengeso Branding Decision: To Brand or Not to Brand?

Branding Decisions


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Issues in the battle of the brands: (1) howprices are set? (2) turnover, and (3) grossmargin.

Manufacturer brands: (1) prices are set tomaximize profit for the brandand are influencedby competitive forces, (2) they have a higherturnover than distributor brands. (Why??)

Distributor brands: (1) prices are set to maximizeprofit for the storeand (2) they have a highergross margin than manufacturer brands.

(Why??)


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Dalr ymple & Pa rs ons/Marke ting Management 7 th edi tion : Chap te r 7 31

Adding An Item: Four BrandAdding An Item: Four Brand

TypesTypes

Product Category

Existing New

Existing LineExtension

BrandExtensionBrand

Name

New Flanker

Brand

New

Product


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Dal rymple & Parsons /Marke ting Management 7th ed it ion: Chapter 7 49

Strategies for Brand RevivalStrategies for Brand Revival

Underlying cause? Reformulate the product/package

Move the product into new foreignor domestic markets

Discover and promote new usesfor the product

New promotion campaign/agency

Cost reduction


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Dalrymple & Parsons/Marke ting Management 7th edi ti on: Chapter 7 50

Options for droppingOptions for droppingproductsproducts

Revive if justified in believing brand canbe saved

Drop promotional activities (reducingcosts) and rely on repeat purchases(which will be more profitable as theycontinue)

Contract or license to another companyfor manufacturing

Sell off/dispose of brand


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Dalrymple & Parsons/Marke ting Management 7th edi ti on: Chapter 7 51

Selling/ Removing a ProductSelling/ Removing a Product

Involves Involves

Minimizing inconvenience to customers

and channel partners Notify dealers in advance

Help dealers clear out old stock

Offer dealer discounts on discontinued brands

Buy back unsold merchandise

Information on replacement brands should be easily

available

Arrange to provide service and parts for recent buyers(customer goodwill)


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They cant stand out in the marketplace and they are

struggling to connect with people. Here are six reasonswhy.


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Michael Eisner of Disney has called the word

brand over-used, sterile, and unimaginative.

Hes right. As the brand manual grows heavier

and more detailed you know youre in trouble.Making sure the flowers in reception conform to

the brand guidelines just shows you are looking

in the wrong direction. Consumers are who you

should be paying attention to. What matters tothem. Otherwise, youre hiding, and youre in

trouble.


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There is a new anti-brand sensibility. There ismuch more consumer awareness, moreconsumers who understand how brands workand, more importantly, how they are intended towork on them! For most brands there is nowhereleft to hide. The information age means thatbrands are part of the public domain. Hiddenagendas, subliminal messages, tricky moves

forget it. For most brands it is a new age ofconsumer savvy.


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The new consumer is better informed, more critical, less

loyal, and harder to read. The white suburban housewife

who for decades seemed to buy all the soap powder no

longer exists. She has been joined by a new population

of multi-generational, multi-ethnic, multi-nationalconsumers


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The more brands we invent the less we notice them as

individuals. If youre not Number One or Two, you might

as well forget it. And the greater the number of brands,

the thinner the resources promoting them. You get a

treadmill of novelty, production value, incrementalchange, tactical promotions, and events


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The definitions, charts, diagrams, and tables. There aretoo many people following the same rule book. Wheneverybody tries to beat differentiation in the same waynobody gets anywhere. Formulae cant deal with human

emotion. Formulae have no imagination or empathy


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The story of brands has gone from daring and inspiration

to caution and aversion to risk. Once the darling of the

bold and the brave, brands are relying on the

accumulation of past experiences rather than the

potential of future ones.


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The Lovemarks of this new century will be the brandsand businesses that create genuine emotionalconnections with the communities and networks they livein. This means getting up close and personal. And no

one is going to let you get close enough to touch themunless they respect what you do and who you are.

Love needs Respect right from the start. Without it, Lovewill not last. It will fade like all passions and infatuations.Respect is what you need when you are in for the long

haul. Respect is one of the founding principles of Lovemarks


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Lovemarks are the future beyond brands.

Lovemarks inspire loyalty beyond reason.

Lovemarks are built on Love and Respect.

Lovemarks are owned by the people who lovethem - consumers not companies.

Lovemarks can be everything that people care

deeply about


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Lovemarks read ROI as Return on Involvement.

Lovemarks are more than irreplaceable. Theyare Irresistible

Kung Fu guys are Irreplaceable. Bruce Lee isIrresistible - 32 years on from his death.

The classic T-shirt is Irreplaceable.

Local or global. you recognize Lovemarks

instantly.


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IDEA #1 DRIP WITH EMOTION

Differentiation is beyond reason , beyond efficiency,benefit, performance, functionality. Table stakes all!!

Fact: Emotion, intuition, long-term memories and

unconscious motivations control as much as 85% of ourdecision-making process.


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Consumers are saying: Youve got three

seconds to change my life or you are gone.

From Information Economy, Knowledge

Economy, Interruption Marketing (aka the MassMarket), Permission Marketing, the ExperienceEconomy, the Attention Economy to the

ATTRACTION ECONOMY.


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Low Respect. Low Love. Commodities, utilities, rawmaterial. No names with no claims. The world ofdiscounts, price wars, crushing competition.

High Love. Low Respect. Hero today zero tomorrow.Fads and infatuations, promotions and competitions.

Reality shows , J Lo jeans, Paris Hilton, the President ofthe US.

High Respect. Low love. Brand to bland. Where thoseer words leach you dead: faster, bigger, brighter,cheaper.

High Love and High Respect. Lovemarks. Enchantinginnovation. Irresistible appeal.


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MysteryThe beguiling power of the unknown.Metaphors and dreams, symbols and stories.The flow of past, present and future. When weknow everything, there is nothing left to delight

us. Sensuality- Sight, sound, smell, touch and

taste are portals to the emotions. never pay apremium for anything that doesn't excite most ofyour senses.

Intimacyis knowing the consumer better thanshe knows herself.


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The energy field is sight, sound and motion.Saatchi & Saatchi invented sisomo for theScreen Age, the everywhere world beyond TV.

89% of major brands are planning to market viamobile phones by 2008, and more than half ofbrands plan to spend between 5% and 25% oftheir marketing budget in the medium in the next

five years. (Airwide Solutions)


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sisomobrings technology, marketing and creativity together. Thisintersection is the future of advertising.

sisomois where art meets science. sisomoputs ideas and potent connections ahead of technology. sisomobrings screens to life in emotional and compelling ways.

sisomoattracts consumers with engaging, compelling stories. Thestory is an ancient, mysterious, timeless art. Marketers are caughtup in technology and methodology. An engaging story well told ispriceless.

sisomoinspires new formats, characters and ways for consumersto participate on screen. Multi-layered, multi-purpose stories thatconsumers can be absorbed by, play with, add to, recreate, andspread virally.


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Boundaries are collapsing. Categories are blurring. Convergenceand divergence are imploding. Entire new industries are emerging.

The Screen Age is about being a creative connector. Creative Connectors across media, advertising, marketing, design,

entertainment, games, phones, ringtones, activations, instore TV,sound logos, animation, sisomo packaging, you name it.

Lovemarks is about Creative Connectors inspiring loyalty beyondreason across the family of screens.

The key connect is the Inspirational Consumer, the ones who loveyour brand, get there first, tell your story and improve it for free.Inspire and connect them!! They turn brands into Lovemarks.

Lovemarks is about lives taking over brands.


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Either / Or compromises. You stay static. .And / And explodesthrough to the next level of possibility.

STARBUCKs: home and work. Coffee and music and movies APPLE: Business modelling ($1 a song) and networking (music

companies) and branding (white buds and wires) TOYOTA: gas and electric. Short and long term. Competitive and

Open. Cost reduction and innovation. Lovemarks build complex opposites together with equal passion so

they enhance each other and take you to a place neither dreamedpossible.


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The role of business is to make the world a better placefor everyone. Its a powerful, provocative, inescapablestatement. Its plain business sense you can beloathed, liked or loved.

Lovemarks make the consumers love you


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MSCA- Product and Brand MBA 2011-13

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