brand leveraging

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+ BRAND LEVERAGING Subject: BRAND BUILDING Faculty Name: Vishal Desai Deviprasad Goenka Management College of Media Studies (dgmcms.org.in) Batch (BMM class of 2015) Year (TY) Indias premier M-school

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Page 1: Brand leveraging

+

BRAND LEVERAGING

Subject:

BRAND BUILDING

Faculty Name:

Vishal Desai

Deviprasad Goenka Management College of Media Studies (dgmcms.org.in)

Batch

(BMM class of 2015)

Year (TY)

India’s premier M-school

Page 2: Brand leveraging

India’s premier M-school

+Brand Leveraging

A brand leveraging strategy uses the power of an existing brand

to expand the product class or to support a company’s entry into a

new product category

Brand leveraging is an important form of new product introduction

because it provides consumers with a sense of familiarity by

carrying positive brand characteristics and attitudes into a new

product category.

Instant recognition of the brand is established, and consumers

with a favorable brand opinion are likely to try a new product they

perceive to have similar quality level and attributes as their

original favorite

Page 3: Brand leveraging

India’s premier M-school

+Leveraging Strategy

Leveraging the brand

Line Extension

Stretching the brand

vertically

Stretching Up

Stretching Down

Brand Extension

Ad-hoc brand extension

Creating a range brand

Co-branding

Page 4: Brand leveraging

India’s premier M-school

+Line Extension Strategies

0.5 liter 1 liter 2 ltrs 5 ltrs 10 ltrs

Product

Size

(Bisleri)

Ingredient

(Pepsodent)

Pink Black Purple Gold

Flavors

(Tropicana)Orange Apple

Mixed Fruit Grapes Guava Cranberry

Colour

(Sunsilk)

Form

(Vim)

Germi check Whitening 2 in 1Pro

Sensitive

Bar Liquid Powder

Page 5: Brand leveraging

India’s premier M-school

+Line Extension

When a variant is added to an existing brand it is called Line

Extension.

The variant could be in terms of flavor, package size, colour,

form,nutritional content or special additives which targets a sub-

set of consumers

The objective is to satisfy different consumer needs or market

segments by providing more variety.

Eg:-Nestle Maggi is available in different flavors like masala,

chicken, tomato,curry and cuppa mania

Eg: Pril Bar’s Mango-vinegar variant in Uttar Pradesh

Nestle has also launched Atta noodles and Maggi Cuppa

Mania

Page 6: Brand leveraging

India’s premier M-school

+Why Line Extension

To fulfill customer’s need for variety

To cater to sub-segments with in a larger segment

To capture customers with different paying capacity

Increase Capacity Utilization

Increase Profitability

To capture more shelf space

To fight competition

Page 7: Brand leveraging

India’s premier M-school

+Stretching the brand vertically

• S Class

• E Class

• C Class

• A Class

• 7 Series

• 5 Series

• 3 Series

• 1 Series

BMWMercedez

Benz

Page 8: Brand leveraging

India’s premier M-school

+Advantages of stretching the brand

vertically Offers a premium version of existing brand to quality conscious consumers.

Eg: Nano Twist with loaded features, Alto K 10

Eg: Credit Card - Silver, Gold, Titanium, Signature

Eg: Cadbury’s Dairy Milk Silk

Helps target value conscious consumers by trading down.

Eg: Stripped down version of Mr. Muscle and Evian water

Eg: Stripped down version of Original DVD without bonus content (show pack)

To counter competition during maturity stage of the brand when price is the

only deciding factor in consumer’s purchase decision

To expand market opportunities in other countries where per capita income is low

Page 9: Brand leveraging

India’s premier M-school

+Disadvantages of stretching the

brand vertically

• Damage to the core brand as consumers may feel that

premium charged to them was not justified

• Increase in volume may not justify the reduction in price

• Reduction in margins of trade channel partners

Page 10: Brand leveraging

India’s premier M-school

+Brand Extension

When an existing brand name is used to introduce a new

product in a different product category.

Eg: Ponds => Talc, Cold Cream, Facewash, Moisturising lotion,etc

Eg: Horlicks=> Nutribar, Foodles

Eg: Catch => Table Salt, Black Salt, Pepper,etc

Eg: Kingfisher => Beer, Airlines, Mineral water, Training Academy

Eg: Dabur=> Amla Hair Oil, Chawyanprash,Pudin Hara

Note: Ponds Toothpaste was a failure

Page 11: Brand leveraging

India’s premier M-school

+Types of Brand Extensions

Image related extension

Eg: Britannia has an image of confectionary brand or food products

brand and hence has launched cakes, biscuits and breads. OR Amul

is known for milk products and hence has launched

butter,ghee,cheese,milk,etc

Un related Extension: Extension to unrelated product category

Eg: Wills Cigarettes to Wills lifestyle apparels

Complementary Product Extension

Eg: Colgate Tooth paste and Colgate tooth brush

Eg: Eveready Battery and Eveready Torches

Page 12: Brand leveraging

India’s premier M-school

+

Expertise related extension:

Eg: Maruti venturing into 2 wheelers

Hero venturing into 4 wheelers

Inox venturing into multiplexes

Distinct feature related extension

Eg: Himani Navratna Hair Oil & Navratna Cool Talc

Class Exercise (Group) – Name a brand

that has been extended and the type of

extension

Page 13: Brand leveraging

India’s premier M-school

+Brand Extension

Range Brands

A range brand is one that creates an identity that works across

product classes. A range brand is some times called a mega-

brand.

Eg: Colgate , Gillette, Adidas /Nike/Reebok

Page 14: Brand leveraging

India’s premier M-school

+Brand Extension

Ad-Hoc Brand Extension

This kind of extension is used as a strategy for response to a

short term event. It is not planned to last. Ad Hoc brands are

generally built on internal goal based strategy. They are based

on either monetary value or sentimental value that the

company gains by introducing a new brand extension.

Eg: Pepsi launched Pepsi Blue during Cricket World Cup

2003,Pepsi Gold during World Cup 2007, and Pepsi Atom

during IPL 2013

Page 15: Brand leveraging

India’s premier M-school

+Limitation of brand extension

At times the brand cannot be stretched to unrelated categories

Eg: Amul could not be stretched to Edible Oil

Eg: Britannia cannot be stretched to Shoes

Page 16: Brand leveraging

India’s premier M-school

+Disadvantages of brand extension

Failure of brand to add value

Eg: Vanilla Coke failed in 2004

Problem of fit

Eg: Ponds tooth paste was a failure

Failure to carry association of parent brand

Eg: Lux Shampoo was a failure as Lux soap was strongly positioned as a beauty soap

where as Lux Shampoo did not carry that association

Creation of Undesirable associations

Eg: Reliance mobile phones when launched had lot of hidden charges and

negative association was created

Page 17: Brand leveraging

India’s premier M-school

+Disadvantages of brand extension

Effect of a brand crisis

Eg: Cadbury’s worm infestation incident had negative effect on all

Cadbury’s products

Failure of new brand

If the new brand which is launched encounters adverse association

with the consumer the original parent brand’s image may also be

diluted.

Page 18: Brand leveraging

India’s premier M-school

+Co-Branding

Co-Branding also called-Brand Bundling or Brand Alliance; is

when two or more existing brands are combined into a joint

product or are marketed together in some way.

It can be termed as marketing partnership between two brands.

The objective is to combine the strength of two brands , in

order to increase the premium consumers are willing to pay.

It makes the co-branded product more resistant to copying.

It combines the different perceived properties associated with

these brands to make a single product

Page 19: Brand leveraging

India’s premier M-school

+Types of Co-branding

Ingredient branding:

- A branded ingredient or component, that has its own brand

identity, is used to produce another renowned brand/product.

- This ingredient or constituent brand is sub-ordinate to the

primary brand.

- Usually the ingredient brand is the biggest supplier to the

primary brand

- The ingredient brand should be unique and should be a major

brand or should be protected by a patent

Page 20: Brand leveraging

India’s premier M-school

+Primary Brand Ingredient Brand

PCs Intel Inside

Stereos Dolby

Sunsilk Keratin Micro Technology

Orient Fans PSPO

Maruti Suzuki K Series Engine

Bajaj Pulsar DTSI

Hyundai CRDi

Good Night Active +

Pantene Pro-V

Saffola LoSorb Technology

Kent Water Purifier Mineral RO Technology

Fiama Di Wills Derma Revitalizers

Page 21: Brand leveraging

India’s premier M-school

+Advantages of Ingredient Branding

Branded ingredients are often seen as a signal of quality.

There is uniformity in quality of ingredient brand which helps

maintain consistency in quality of primary brand.

Ingredient brands can become industry standards and

consumers would not buy a product that does not contain the

ingredient brand.

Page 22: Brand leveraging

India’s premier M-school

+Composite Branding The bundling of two brands to provide an enhanced customer benefit

or reduced cost.

Composite co-branding refers to use of two or more renowned brand

names in a way that can collectively offer a distinct product/service

that could not be possible individually

Egs:

Reliance CDMAS with LG handset

Nokia with Vodafone

Airtel with iPhone

Coca-Cola with McDonalds

Audi Cars with Bang & Olufsen Sound System

Channel V Racing Pack & AXN Action Pack

Page 23: Brand leveraging

India’s premier M-school

+Advantages of Co-branding

Cost effective way of marketing a product

Boost to the brand image of both the companies while

increasing sales volumes and profits

If one of the brand is a service brand and the other is a tangible

product brand , the service brand gets a tangible extension.

Increased width of distribution due to distribution strength of

both the companies

Advantageous for a new brand to tie-up with an existing brand

as it helps the new brand to understand the market dynamics

with the help of the existing brand

Page 24: Brand leveraging

India’s premier M-school

+Disadvantages of co-branding

If the two brands involved do not show consistent brand values,

identity and personality there are chances of dilution of brand

image

Co-branding can fail when the two brands have entirely

different markets and are entirely different

If the vision and mission of the two brands involved are

different then composite branding may fail

If the customers encounter any adverse experience the brand

image of both the brands may suffer

Page 25: Brand leveraging

India’s premier M-school

+Advantages of brand leveraging

It increase advertising efficiencies

It increases life cycle of a brand

Minimises introductory expenses

Minimises marketing & distribution expenses

Encourages trial purchase

Satisfies variety seeking consumers

Page 26: Brand leveraging

Line Extension (Variants)

Sunsilk

Silk & Shine Smooth & Soft Long & Black

Brand ExtensionSunsilk Conditioner

Lifebuoy

(Soap to Hand wash)

Fastrack

(Watches to Sunglasses)

Multi Brands

HUL- Shampoo Brands

Sunsilk

Dove

Clinic Plus

All Clear

Diversification

HUL- FMCG to Water Purifiers

(Pure-it )

Glaxo Smithklinelaunching Foodles

Existing

New

Existing New

Brand

Product

Page 27: Brand leveraging

Line Extension (Variants)

Economic Times

ET (English)

Economic Times

ET (Gujarati)

Brand Extension

ET NOW

Multi Brands

TOI

Maharashtra Times

Navbharat Times

Economic Times

Diversification

Zoom

Radio Mirchi

Indiatimes.com

Mirchi Movies

Existing

New

Existing New

Brand

Product

Page 28: Brand leveraging

India’s premier M-school

+Multi Brand Strategy

A company launches multiple brands for the same product

category

Each brand caters to a distinct market segment

Each brand has a distinct brand identity and personality

Page 29: Brand leveraging

India’s premier M-school

+Advantages of multi brand strategy

A company can target the entire market with different brands

catering to each separate market segment

A company can enjoy economies of scale because key

ingredients / raw materials are the same for each product

A consumer gets wide range of options to choose from

A company is able to capture larger shelf space at retail end

Page 30: Brand leveraging

India’s premier M-school

+Disadvantages of multi brand

strategy

All brands may not be successful thus leading to wastage of

marketing and advertising expenses.

The company may spread it self very thin if it launches too

many brands with small market share for each brand

If there is no difference between two brands, one may

cannibalize the other.