Ashesi University

COURSE TITLE : STRATEGIC BRAND MANAGEMENT

SEMESTER : SECOND, 2009/2010MODULE 7: Leveraging Secondary Brand

Associations to Build EquityLecturer: Ebow Spio

Learning Outcomes

• Explain how a brand can build equity through the leverage of related or secondary associations

• Gain the skill to leverage brand equity through secondary associations

7.3

Figure 2-9 Building Customer-Based Brand EquityBRAND BUILDING TOOLS AND OBJECTIVES CONSUMER KNOWLEDGE EFFECTS BRANDING BENEFITS

Choosing Brand Elements

Brand name MemorabilityLogo MeaningfulnessSymbol AppealCharacter TransferabilityPackaging AdaptabilitySlogan Protectability

Developing Marketing Programs

Product Tangible and intangible benefitsPrice Value perceptionsDistribution channels Integrate”push” and “pull”Communications Mix and match options

Leverage of Secondary Associations

CompanyCountry of originChannel of distributionOther brandsEndorsorEvent

AwarenessMeaningfulnessTransferability

Possible Outcomes

Greater loyalty

Less vulnerability to competitive marketing actions and crises

Larger margins

More elastic response to price decreases

More inelastic response to price increases

Greater trade cooperation and support

Increased marketing communication efficiency and effectiveness

Possible licensing opportunities

More favorable brand extension evaluations

Brand Awareness

Depth

Breadth

RecallRecognition

PurchaseConsumption

Brand Associations

Strong

Favorable

Unique

RelevanceConsistency

DesirableDeliverable

Point-of-parityPoint-of-difference

7.4

Leveraging Secondary Associations

• Creation of new brand associations• Effects on existing brand knowledge– Awareness and knowledge of the entity– Meaningfulness of the knowledge of the entity– Transferability of the knowledge of the entity

7.5

Leveraging Secondary Associations• Brand associations may themselves be linked to

other entities, creating secondary associations:– Company (through branding strategies) e.g. Bon Aqua by Coca

Cola– Country of origin (through identification of product origin) Sony

from Japan – Channels of distribution (through channels strategy)– Other brands (through co-branding)

• Special case of co-branding is ingredient branding e.g. Intel Inside

– Characters (through licensing)– Celebrity spokesperson (through endorsement advertising)

Accenture and Tiger Woods– Events (through sponsorship) MTN and FIFA 2010– Other third-party sources (through awards and reviews) Glo CAF

awards

7.6

• These secondary associations may lead to a transfer of:– Response-type associations• Judgments (especially credibility)• Feelings

– Meaning-type associations • Product or service performance• Product or service imagery

Leveraging Secondary Leveraging Secondary AssociationsAssociations

7.7

Co-Branding Occurs when two or more existing brands are

combined into a joint product or are marketed together in some fashion

Examples: Sony Ericsson

Siemens and Porsche design which produce a range of kettles, toasters and coffee machines

Star Alliance which includes 16 different airlines such as Lufthansa, Singapore Airlines

The Smart Car : Swatch and Mercedes Benz

7.8

Advantages of Co-Branding Borrow needed expertise Leverage equity you don’t have Reduce cost of product introduction Expand brand meaning into related

categories Broaden meaning Increase access points

Source of additional revenue

7.9

Disadvantages of Co-Branding Loss of control Risk of brand equity dilution Negative feedback effects Lack of brand focus and clarity Organizational distractions

7.10

Ingredient Branding A special case of co-branding that involves

creating brand equity for materials, components, or parts that are necessarily contained within other branded products

Examples: Intel inside

7.11

Licensing Involves contractual arrangements whereby

firms can use the names, logos, characters, and so forth of other brands for some fixed fee

Examples: Entertainment (Star Wars, Spider Man, Shriek ,

Micky Mouse of Disney etc.) Television and cartoon characters (The Simpsons) Designer apparel and accessories (Calvin Klein,

Pierre Cardin, Ralph Lauren etc.)

7.12

Celebrity Endorsement Draws attention to the brand Shapes the perceptions of the brand Celebrity should have a high level of visibility

and a rich set of useful associations, judgments, and feelings

Q-Ratings to evaluate celebrities

7.13

Celebrity Endorsement: Potential Problems

Celebrity endorsers can be overused by endorsing many products that are too varied.

There must be a reasonable match between the celebrity and the product.

Celebrity endorsers can get in trouble or lose popularity.

Many consumers feel that celebrities are doing the endorsement for money and do not necessarily believe in the endorsed brand.

Celebrities may distract attention from the brand.

7.14

Sporting, Cultural, or Other Events

• Sponsored events can contribute to brand equity by becoming associated to the brand and improving brand awareness, adding new associations, or improving the strength, favorability, and uniqueness of existing associations.

• The main means by which an event can transfer associations is credibility.

7.15

Third-Party Sources

• Marketers can create secondary associations in a number of different ways by linking the brand to various third-party sources.

• Third-party sources can be especially credible sources.

• Marketers often feature them in advertising campaigns and selling efforts .– Example: J.D. Power and Associates’ well-

publicized Customer Satisfaction Index

Key Points

1. Brands can “borrow” equity from their association with people, places, programs, and other non-product-based sources.

2. Secondary associations are strongest when consumers have awareness and strong, favorable, and unique perceptions of the external source.

3. Secondary associations are most likely to affect evaluations when consumers lack the ability or motivation to judge product attributes.

4. Leveraging secondary associations can be problematic because it requires marketers to give up some degree of control over the branding process.

Tutorial Questions 1. The Boeing Company makes a number of different types of aircraft for the

commercial airline industry, e.g., the 727, 747, 757, 767, and 777 jet models. Is there any way for Boeing to adopt an ingredient branding strategy with their jets? How? What would be the pros and cons?

2. After winning major championships, star players often complain about their lack of endorsement offers. Similarly, after every Olympics, a number of medal-winning athletes lament their lack of commercial recognition. From a branding perspective, how would you respond to the complaints of these athletes?

3. Think of the country in which you live. What image might it have with consumers in other countries? Are there certain brands or products that are highly effective in leveraging that image in global markets?

4. Pick a brand. Evaluate how it leverages secondary associations. Can you think of any ways in which the brand could more effectively leverage secondary brand knowledge?