BMGT 411: Chapter 8, Brand Equity

Chapter 8 Questions

• What is a brand and how does branding work?

• What is brand equity and how is it built, measured, and managed?

• What are the important decisions in developing a branding strategy?

Steps in Strategic Brand Management

• Identifying and establishing brand positioning

• Planning and implementing brand marketing

• Measuring and interpreting brand performance

• Growing and sustaining brand value

What is a Brand?

• A 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 group of sellers and to differentiate them from those of competitors.

Attributes of Great Brands

The Role of Brands

• Identify the maker

• Simplify product handling

• Organize accounting

• Offer legal protection

The Role of Brands

• Signify quality

• Create barriers to entry

• Serve as a competitive advantage

• Secure price premium

What is Branding?

•Branding is endowing products and services with the power of the brand. •Teaching customers “who” the product is•Tells customers what the product does•Reinforces why consumers should care

What is Brand Equity?

• Brand equity is the added value endowed on products and services, which may be reflected in the way consumers, think, feel, and act with respect to the brand.

• What are some of your favorite brands?

• Why?

• What feelings do you get when you think go these brands?

Brand Equity

What comes to mind when you think of these brand retailers?!Why?

Advantages of Strong Brands

• Improved perceptions of product performance

• Greater loyalty

• Less vulnerability to competitive marketing actions

• Less vulnerability to crises

• Larger margins

• More inelastic consumer response

• Greater trade cooperation

• Increased marketing communications effectiveness

• Possible licensing opportunities

What is a Brand Promise?

• A brand promise is the marketer’s vision of what the brand must be and do for consumers.

• What do you think the brand promise is for the retailers we discussed?

Brand Equity Models

Brand Asset Valuator (BAV)

Brandz

Brand Resonance

Brand Asset Valuator (BAV)

Strong New Brands: Higher in Energized Differentiation, low esteem and knowledge !Leadership Brands: High in all categories !!Declining Brands: High Knowledge, low everything else

Figure 8.2 Brand Dynamics BrandZ Model

Figure 8.3 Brand Resonance Pyramid Think of Brands in these

Stages?

Building Brand Equity

1.Identify Brand Elements (Name, Logo, URL, etc) and identities that make up the brand

2.The Product, Service, and All Marketing Activities and Marketing Programs

3. Other associations indirectly transferred to the brand (Figure 8.4 Page 119)

Brand Elements

• Brand names

• Slogans

• Characters

• Symbols

• Logos

• URLs

• Social Media Presence

• Customer Service Strategy

Brand Element Choice Criteria

• Building the Brand

• Memorable: Is the elements easily recalled and recognized at purchase and consumption (Tide)

• Meaningful: Is the element credible and suggestive of the category? Does it suggest something about an ingredient or brand user? (Diehard)

• Likable: Is the element appealing and likable visually or in other ways? (iPad)

• Defending a Brand

• Transferrable: Can the element introduce new products in the same category or other category? (Amazon, Soap.com, Wag.com, diapers.com)

• Adaptable: Can the element be adapted and updated (Betty Crocker image)

• Protectable: Is the element legally and competitively protected? Google

Betty Crocker Images Brand of General Mills

The Color of a Brand

The Color of a Brand

Secondary Sources of Brand Knowledge

Cult Brands: Building Equity Without Promotions

http://www.youtube.com/watch?v=ZUG9qYTJMsI&feature=player_embedded#!

Measuring Brand Equity

• Brand audits: A consumer focused series of procedures to asses the health of the brand, uncover its sources of equity, and suggest ways to improve and leverage it’s equity.

• Brand tracking: Qualitative Marketing Research that collects data from consumers over time to provide baseline information on how brands and marketing programs are performing

• Brand valuation: The actual financial value of a brand

Interbrand Retail US Brand Valuations

http://www.interbrand.com/en/best-global-brands/2013/BGB-Interactive-Charts.aspx

Branding Terms (Page 122)

• Brand line

• Brand mix

• Brand extension

• Sub-brand

• Parent brand

• Family brand

• Line extension

• Category extension

• Branded variants

• Licensed product

Branding Decisions

• Individual or Separate Family Brand Names: Individual names of brands across multiple categories, even though the company that makes the products are the same

Branding Decisions

• Corporate Umbrella or Company Brand Name: Use one name across a variety of products. Becoming very popular as a strategy of private label products.

Branding Decisions

• Sub Brand Names: Combines corporate umbrella brands with individual or family brands

Brand Portfolios

• Flankers

• Cash cows

• Low-end, entry-level

• High-end prestige

Brand Portfolios

• Flankers: Fighter brands are positioned alongside competitor brands so that more important and more profitable flagship brands can retain their desire positioning

• Cash cows: Still profitable without much marketing, dwindling sales, but still profitable

• Low-end, entry-level: Attract customers to the brand franchise with lower prices

• High-end prestige: Higher priced, adds prestige and credibility to overall portfolio

Brand Extensions

• Most products are Brand Extensions (80-90%) - as they create new demand based on trends, customer tastes, without building the brand from scratch each time a new product is launched.

• A key trend is ease and convenience “Lifehacks”

Final Notes on Brands

Final Notes on Brands