CHAPTER 1: BRANDS & BRAND MANAGEMENT

UNDERSTANDING BRANDS & BRAND MANAGEMENTDr. Etinder Pal Singh

What is a brand?

Emotional/Feelings

TRUST

Brands vs. Products

1Brand is the difference between a bottle of soda andcoke

Is the difference between mp3 player and an ipod

Is the difference between coffee cup and starbucks

Psychological differences are more strong than functional differential advantage. Emotional associations are difficult to copy

What is a brand?Something that has actually created a certain amount of awareness, reputation, prominence, and so on in the marketplace1Brand DefinitionsA Brand is a name, term, sign symbol or design or a combination of them, intended to identify the goods or services of one seller or a group of sellers and to differentiate them from those of competitors- Philip Kotler

25Brand DefinitionsA successful brand is an identifiable product, service, place or person, augmented in such a way that the buyer or user perceives relevant, unique added values which match their needs most closely. Furthermore, its success results from being able to sustain these added values in face of competition- Leslie & Malcolm, in Creating Powerful Brands

Brand DefinitionsA Brand is a distinguishing name and/or symbol (such as a logo, trade mark, or package design) intended to identify the goods or services of either one seller or a group of sellers, and to differentiate those goods or services from those of competitorsDavid Aaker27Five Levels of Meaning for a Product The core benefit level - fundamental need or wantThe generic product level- a stripped-down, no-frills version of the product that adequately performs the product functionThe expected product level- set of attributes or characteristics that buyers normally expect and agree to when they purchase a productThe augmented product level- includes additional product attributes, benefits, or related services that distinguish the product from competitorsThe potential product level- includes all the augmentations and transformations that a product might ultimately undergo in the futureHistorical Evolution of BrandsBranding was Stamping (Animals) for IdentificationDefined by Oxford Dictionary as, 'to mark permanently as proof of ownership, as a sign of quality, or for any other purpose'Hence Branding began as a legal issue even on products, however is soon became important in that-Source of Product became traceableQuality was assuredConsumer loyalty to a producer became legitimate and expected29Historical Evolution of Brands ContdRapid rise of urban growth from 1960s and growing distance between producer and consumer led to rapid growth in Branding

The growth was supported by advent and proliferation of MASS MEDIA and ORGANISED RETAILING. The former facilitating branding and the latter necessitating it

From 1980s Intangible Value addition has come to be a chief value building element and hence today all the more importance of Branding30BrandingBranding is a process of brand development and its management (which includes issues as Brand Extension, Brand Health Monitoring, Brand Rejuvenation & the like)

Brand is a collection of associations, commercially material with regard to a commercial entity (which can be Product/product category/firm/Places/personality & like entities)31Why do brands matter?Importance of Brands to ConsumersIdentification of the source of the productAssignment of responsibility to product makerRisk reducerSearch cost reducerPromise, bond, or pact with product makerSymbolic deviceSignal of quality

1Reducing the Risks in Product DecisionsFunctional riskPhysical riskFinancial riskSocial riskPsychological riskTime riskConsumers may perceive many different types of risks in buying and consuming a product:Functional riskThe product does not perform up to expectations.Physical riskThe product poses a threat to the physical well-being or health of the user or others. Financial riskThe product is not worth the price paid.Social riskThe product results in embarrassment from others.Psychological riskThe product affects the mental well-being of the user.Time riskThe failure of the product results in an opportunity cost of finding another satisfactory product.

Importance of Brands to FirmsValuable pieces of legal property, capable of influencing consumer behavior, being bought and sold, and providing the security of sustained future revenuesIdentification to simplify handling or tracingImportance of Brands to Firms ContdLegally protecting unique featuresSignal of quality levelEndowing products with unique associationsSource of competitive advantageSource of financial returns1What all can be Branded?

RememberBrand is something that resides in the minds of consumersAnd the key to branding is -consumers perceive differences among brands in a product categoryExamples of commodity branding?What all is branded?Physical goodsServicesRetailers and distributorsOnline products and servicesPeople and organizationsSports, arts, and entertainmentGeographic locationsIdeas and causes1

What are the strongest brands?The Leading Brands - 1925-1985Product Leading Brand, 1925Position 1985BatteriesEverydayLeaderBiscuitsNabiscoLeaderBreakfast CerealKelloggLeaderCamerasKodakLeader Canned FruitDel MonteLeader Chewing GumWrigleyLeaderChocolatesWrigleyNo. 2 FlourGold MedalLeader Mint CandiesLife SaversLeader PaintSherwin-WilliamsLeader

411.42Top Ten Global Brands 2013

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Importance of Brand ManagementThe bottom line is that any brandno matter how strong at one point in timeis vulnerable, and susceptible to poor brand management

Branding Challenges and OpportunitiesSavvy customersBrand proliferationMedia fragmentationIncreased competitionIncreased costsGreater accountability Strategic Brand ManagementInvolves the design and implementation of marketing programs and activities to build, measure, and manage brand equity.

Strategic Brand Management ProcessMental mapsCompetitive frame of referencePoints-of-parity and points-of-differenceCore brand valuesBrand mantraMixing and matching of brand elementsIntegrating brand marketing activitiesLeveraging of secondary associations

Brand value chainBrand auditsBrand trackingBrand equity management systemBrand-product matrixBrand portfolios and hierarchiesBrand expansion strategiesBrand reinforcement and revitalizationKey ConceptsStepsGrow and sustainbrand equityIdentify and establishbrand positioning and valuesPlan and implement brand marketing programsMeasure and interpretbrand performance1

Strategic Value of Brand LoyaltyEnhances brand equity and hence the value of the firmReduced Marketing CostsTrade & Retail LeverageAttracting new customersBrand Awareness createdRe-assurance to new customersTime to respond to competitive threats47Constituent Categories of the Product

Product- Function, Design, Packaging, Price, Efficacy, FeaturesServices-Before Sales Service, After Sales Service, Delivery, Availability, Advice, Finance, Warrantees, Gurantee, Add-onsBrand- Perceptions on issues (like Ethical reliability, Quality, etc.) with regard to Corporate Brand, Product/s Brand48Commodity to Brand PriceDifferentiation/ MarginsProduct/Image DifferentiationBranded MarketsCommodity MarketsIntangible ValueAddition49Consumer Preference Tests on Diet Coke & Diet PepsiBlind TestsOpen Branded Test Prefer Pepsi51%23%Prefer Coke44%65%Equal/cannot say5%12%

Consumers Experience the Power of the Brandillusion of Truth50The Key to BrandingFor branding strategies to be successful, consumers must be convinced that there are meaningful differences among brands in the product or service category.Consumer must not think that all brands in the category are the same.PERCEPTION = VALUE17

BRAND ELEMENTS TO BUILD BRAND EQUITYBrand NamesLogos and SymbolsCharactersURLsSlogansJinglesPackaging

Criteria for Choosing Brand Elements Memorability Meaningfulness Likability Transferability Adaptability Protectability Marketers offensive strategy and build brand equity Defensive role for leveraging and maintaining brand equity Brand Naming GuidelinesBrand awarenessSimplicity and ease of pronunciation and spelling Familiarity and meaningfulness Differentiated, distinctive, and uniquenessBrand associationsThe explicit and implicit meanings consumers extract from it are important

Brand Naming ProceduresDefine objectives Generate names Initial ScreeningStudy possible names Research the final namesSelect the final name Logos and SymbolsPlay a critical role in building brand equity and especially brand awareness Logos range from corporate names or trademarks written in a distinctive form, to entirely abstract designs

CharactersA special type of brand symbolone that takes on human or real-life characteristics Some are animated or live-action figures like Pillsburys Poppin Fresh Doughboy, Amuls girl butters, and McDonalds Joker Or MDH, Country ClubURLs

URLs (uniform resource locators) specify locations of pages on the webCopyright infringement, buying or register all conceivable variations of its brand as domain names ahead of time

SlogansShort phrases that communicate descriptive or persuasive information about the brand. Extremely efficient means to build brand equity Slogans are short phrases that communicate descriptive or persuasive information about the brand. Slogans are powerful branding devices because, like brand names, they are an extremely efficient, shorthand means to build brand equity

JinglesMusical messages written around the brand. Have catchy hooks and choruses to become almost permanently registered in the minds of listenerssometimes whether they want them to or not! Perhaps most valuable in enhancing brand awareness. Jingles are musical messages written around the brand. Typically composed by professional songwriters, they often have enough catchy hooks and choruses to become almost permanently registered in the minds of listenerssometimes whether they want them to or not! Jingles are perhaps most valuable in enhancing brand awareness.

PackagingObjectives:Identify the brandConvey descriptive and persuasive informationFacilitate product transportation and protectionAssist at-home storageAid product consumptionSource: Susan B. Bassin, Value-Added Packaging Cuts through Store Clutter, Marketing News, 26 September 1988, 21.Packaging canInfluence Taste Influence Value

Our sense of taste and touch is very suggestible, and what we see on a package can lead us to taste what we think we are going to taste. Long after we have bought a product, a package can still lead us to believe we bought it because it was a good value.

Packaging Can Influence Consumption Studies of 48 different types of foods and personal care products have shown that people pour and consume between 18% and 32% more of a product as the size of the container doubles. Valerie Folkes, Ingrid Martin and Kamal Gupta, When to Say When: Effects of Supply on Usage, Journal of Consumer Research, 20 December 1993, 467-477.Packaging Can Influence How a Person Uses a Product One strategy to increase use of mature products has been to encourage people to use the brand in new situations, like soup for breakfast, or new uses, like baking soda as a refrigerator deodorizer. An analysis of 26 products and 402 consumers showed that twice as many people learned about the new use from the package than from television ads. Putting It All Together The entire set of brand elements makes up the brand identity, resulting in awareness and image The cohesiveness of the brand identity depends on the extent to which the brand elements are consistent.