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

Building Brand Equity andBrand Identity



Designing Marketing Programs

to Build Brand Equity

Keller, Chapter 5



Overview

How do marketing activities—also product, pricing, and

distribution strategies—build brand equity?

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

responses, and increase brand resonance?



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



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



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

product’s 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.



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 toconsumers’ perceptions of brands.



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.




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

Marketers might develop stronger relationships withconsumer desire to receive further communication relationship can be develop if marketers respect consumers’

wishes and of consumers express a willingness to become

more involved with the brand.




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.



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



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.



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 firm’s best customers through long term, interactive, valueadded relationships.



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.



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 brandscan’t 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.



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



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).

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

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

Cooperative advertising: manufacturer pays for a portion of theadvertising that a retailer runs to promote manufacturer’s product andits availability in the retailer‘s place of business.



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 retail channel, or work together with online retailers

such as Amazon, Zalora, Lazada, Rakuten, etc.



Integrating Marketing

Communications to Build

Brand EquityKeller, Chapter 6



Overview

Marketing communications are the means by which firms

attempt to inform, persuade, and remind consumers—directly

or indirectly—about the brands they sell.



The New Media Environment

Traditional advertising media such as TV, radio, magazines,

and newspapers seem to be losing their grip on consumers.

Marketers pour $18 billion into Internet advertising in 2005.

While Web advertising jumped 20% during this time, spending

for TV ads remained flat.



Simple Test for

Marketing Communications

Current

Brand

Knowledge

Desired

Brand

Knowledge



Information Processing Model of Communications

1. Exposure

2. Attention

3. Comprehension

4. Yielding

5. Intentions

6. Behavior



Marketing Communications Options

Advertising

Promotions

Event marketing and sponsorship

Public relations and publicity

Personal selling



Advertising

A powerful means of creating strong, favorable, and unique

brand associations and eliciting positive judgments and

feelings

Controversial because its specific effects are often difficult to

quantify and predict

Nevertheless, a number of studies using very different

approaches have shown the potential power of advertising on

brand sales.



Ideal Ad Campaign

The ideal ad campaign would ensure that:

1. The right consumer is exposed to the right message at the right place and atthe right time.

2. The creative strategy for the advertising causes the consumer to notice and

attend to the ad but does not distract from the intended message.

3. The ad properly reflects the consumer’s level of understanding about theproduct and the brand.

4. The ad correctly positions the brand in terms of desirable and deliverablepoints-of-difference and points-of-parity.

5.The ad motivates consumers to consider purchase of the brand.

6. The ad creates strong brand associations to all of these storedcommunication effects so that they can have an effect when consumers areconsidering making a purchase.



Promotions

Short-term incentives to encourage trial or usage ofa product or service

Marketers can target sales promotions at either thetrade or end consumers

Consumer promotions Consumer promotions are designed to change the choices,

quantity, or timing of consumers’ product purchases.

Trade promotions

Trade promotions are often financial incentives ordiscounts given to retailers, distributors, and othermembers of the trade to stock, display, and in other waysfacilitate the sale of a product.



Event Marketing and Sponsorship

Event marketing is public sponsorship of events or activitiesrelated to sports, art, entertainment, or social causes.

Event sponsorship provides a different kind of

communication option for marketers. By becoming part of aspecial and personally relevant moment in consumers’ lives,

sponsors can broaden and deepen their relationship withtheir target market.



Public Relations and Publicity

Public relations and publicity relate to a variety of programs

and are designed to promote or protect a company’s image or

its individual products.

Buzz Marketing

Occasionally, a product enters the market with little fanfare yet is

still able to attract a strong customer base.



Personal Selling

Personal selling is face-to-face interaction with oneor more prospective purchasers for the purpose ofmaking sales

The keys to better selling Rethink training

Get everyone involved

Inspire from the top

Change the motivation Forge electronic links

Talk to your customers



Integrated Marketing Communications (IMC)

The “voice” of the brand

A means by which it can establish a dialogue and build relationships

with consumers

Allow marketers to inform, persuade, provide incentives, and remind

consumers directly or indirectly

Can contribute to brand equity by establishing the brand in memory

and linking strong, favorable, and unique associations to it



Developing IMC Programs

Mixing communication options

Evaluate all possible communication options available to create

knowledge structures according to effectiveness criteria as well as cost

considerations.

Different communication options have different strengths and can

accomplish different objectives.

Determine the optimal mix



Evaluating IMC Programs

Coverage: What proportion of the target audience is reached by each

communication option employed? How much overlap exists among

options?

Cost: What is the per capita expense?

di i i i l



Communication

Option A

Communication Option C

Communication

Option B

IMC Audience Communication Option Overlap

Note: Circles represent the market segments reached by various communication options.Shaded portions represent areas of overlap in communication options.



Evaluating IMC Programs (cont.)

Contribution: The collective effect on brand equity in terms of

enhancing depth and breadth of awareness

improving strength, favorability, and uniqueness of brand associations

Commonality: The extent to which information conveyed by different

communication options share meaning



Evaluating IMC Programs (cont.)

Complementarity: The extent to which different associations and

linkages are emphasized across communication options

Versatility: The extent to which information contained in a

communication option works with different types of consumers Different communications history

Different market segments



Marketing Communication Guidelines

• Be analytical: Use frameworks of consumer behavior andmanagerial decision making to develop well-reasonedcommunication programs

•

Be curious: Fully understand consumers by using all forms ofresearch and always be thinking of how you can create added valuefor consumers

• Be single-minded: Focus message on well-defined target markets(less can be more)

• Be integrative: Reinforce your message through consistency andcuing across all communications



Marketing Communication Guidelines(Cont.)

• Be creative: State your message in a unique fashion; use alternativepromotions and media to create favorable, strong, and unique brandassociations

• Be observant: Monitor competition, customers, channel members,and employees through tracking studies

• Be realistic: Understand the complexities involved in marketingcommunications

• Be patient: Take a long-term view of communi-cation effectivenessto build and manage brand equity