BRAND MANAGEMENT AND STRATEGY

BRAND MANAGEMENT AND STRATEGYDr. Michael Marck

Course: MBM- Business SchoolName: Shanu GargRegistration No.: 2014

QUESTION 2: Discuss strategies global brands can use to minimize consumer ethnocentrism when entering new, foreign markets. Use examples in your response.

ANSWER:

Consumer ethnocentrism is one of the most important tool for domestic firms to compete with the foreign companies however it can vary in different industries, culture and demographics. Hence in the modern era it is very important for foreign firms to understand various potential obstacles that consumer ethnocentrism can create and deploy appropiate straegies to counter its effect, as in modern era a company cannot grow unless and it has a diverse portfolio and competes in different markets.

Ethnocentric Consumer thinks that buying a foreign product hurt the national economy and employement and believes that it is immoral/unpatriotic to do so. Ethnocentric consumers also believe that domestic product provide a better value and quality compared to the foreign product. Such consumer will only purchase a foreign brand if they see that there is no local brand to satisfy their needs.

The table below shows various groups and helps us find out which groups could be more ethnocentric. Respondants having high CETSCALE greater than low CETSCALE(in Shimp and Sharma (1987) CETSCALE) are highly ethnocentric.

From the above table it could be seen that ethnocentrisim varies with demographics and particularly Female consumers, old consumers, less educated consumers and consumers with low income were seen to be highly ethnocentric.

As different products/brands targets different consumer groups hence it makes very important for companies entering a foreign market to learn more about consumer ethnocentrism of the consumers from a specific country and need to be very cautious and strategic when penetrating a new market.

GLOCAL STRATEGY:

As the name suggests this is the hybrid of global and local. It means a company should have global backstage activites such as organisation, producition and technology which will help them exploit economics of simplicity and help them save cost and time. While organisations need to be very sure that the product features, marketing and distribution is done in accordance with local needs and wants of the consumers. Glocalisation helps brands to make a connection with their customers which was kind of missing in the early time of gloabalization as companies were just focusing on standardization of products to cut the cost. Also it forces companies to think global act local(Osemecreate.blogspot.co.uk).It can also provide company with competetive adbantage such as

Consumer can feel the brand relevance Increase in market share of the company Better balance between different level of marketing strategies

Example: When we talk about the hybrid of global and local strategy, McDonalds is one of the company which has been fairly successful in implementing it. It operates in more than 117 countries and is one of the top ten most important brand in the world, to achieve this kind of success a companies strategy needs to be dynamic and spot on. From products to advertisement campaign to market segmentation every thing differs form country to country, as in USA McDonalds offer large meals whereas in Japan they offer small meal whereas in India they do not use beef instead introduced new vegetarian products that were highly successful. Though their products may differ in different countries but their core values and backstage activities remain the same and hence McDonalds use Glocal strategy in the best possible way.

LEAVING THE HUBRISTIC APPROACH BEHIND:

When entering the new market the most common mistake commited by companies is following their hubristic approach. Especially companies need to dig in more while entering a market with different traditions, as in western companies need to dig in more about asian market and vice versa. And hence companies need to localize their business models and strategies.Example:Let us take an example of best buy. The company was trying to enter chinese market and opened their first outlet in Shanghai(a highly populated city), but their approach was based on their success back in America. They opened huge store in downtown Shanghai. The store had a large number of products and consumers had to walk few floors to reach the store entrance. Local stores were quick to assess the opportunity and came up with small stores near best buy, selling only high margin and products with high demand. In China, revenue and profit per square feet of retail space is too low (CNBC) hence it doesnt make sense for big stores to sell products with low margins,this is what wnet wrong for best buy. Companies entering markets like China should either alter their traditional model to fit the market conditions or should completely drop the idea of entering such a market.Another example of not aligning the strategy with the local need would be wallmart who again followed strategies that were successful in america and opened big stores and hence lost the competetion to the local distributors especially in the fruit and meat market.

LANGUAGE AND CULTURE:

A company needs to consider culture as a very important factor. We all know it is very important to understand the culture of the market but what companies might overlook is that it is equally important to build internal culture of the company so that they can successfully cater the cultural needs of the market. This could be done by hiring local work force and hiring local people at important strategic roles. This would further help company to overcome language problem and avoid doing mistakes as done by chevrolet when they launched their nova model in Mexico, where "no va" stands for "it doesn't go" (Small Business - Chron.com) which was certainly not a good name for a car.

There can be huge cultural differences seen in different countries which makes it a need for a company to be dynamic.A colour or symbol in some country could carry a different meaning and could mean something entirely different in other, that is why a company needs to be sure that there is no way they could end up harming cultural sentiments or cultural belief. And hence communication plays a very important role, as it is the only way brand can interact with the customers via various means such as advertising, social media, newspaper etc.

Example: Back in 1994 when kellogs entered Indian market, the company wanted people to switch from their traditional habits(hot breakfast) to start having cereals as it was a healthier breakfast option. But the way in which company communicated with the consumers failed miserable as in their initial advertisement kellogs demonstrated that Indians were not having healthier breakfast which negatively impacted the sentiments of indian women, whi have been serving traditional breakfast since ages. And also Indians were used to having warm milk in breakfast whereas cereals were rather used with cold milk hence the crispiness of cereals eroded. And this how company didnt understood another Indian consumer cultural aspect. Although after initial problems the company came back strongly in the Indian market and became the market leader.

OFFERING BETTER VALUE TO CONSUMERS:

A brand offering better value to the consumers is destined to face less consumer ethinocentrism in a new market. Better value could be providing consumers with latest technology or unparralled quality or superior brand that there domestic brands cannot compete with. Providing a better value should be accompanied by constant innovation if a brand is planning to aquire a good amount of market share for a long term otherwise companies could face same consequences as faced by Nokia.

Example: Lets discuss about nokia in accordance to Indian market. Nokia were the market leaders in India in 2008 with around 38% market share. Since then the introduction of the android platform revolutionised the mobile phone market to which nokia were not able to respond and consumers started shifting to brands like Samsung and Micromax(domestic Indian company) as they provided more value to the customers compared to Nokia. Nokia were not able to induce innovation in their products and now their market share is around mere 10%. So yes it is very important to understand customer needs and introduce innovative product to keep your consumers engaged.

Question 3: A firm selling cement to businesses (B2B) has asked you to compose a social media promotion to build their brand equity and brand identity. List and discuss six key factors you would include for the cement firms B2B social media branding promotion.

ANSWER:

Brand management was considered to be a very important element (Casper et al., 2002) and it has become more important than ever , it could be directly related to image and values of the company and the trust it has in comsumers and suppliers, Buyers can benefit from trusting their suppliers, experiencing less stress from the confidence, comfort and warmth they hold with a branded supplier(Hague and Jackson, 1994).Brand equity can be defined as a set of assets (and liabilities) linked to a brands name and symbol that adds to (or subtracts from) the value provided by a product or service to a firm and/or that firms customers (Aaker, 1996). Building positive brand equity is very important as it increases the value of the brand. Brand equity has four dimensions brand loyalty, brand awareness, brand associations, and perceived quality(Aaker) and they all add up to the value of the firm in a number of ways. So to build brand equity a company needs to focus upon all the dimensions and effective communication plays a important role to do the same. Social media has become the best platform to engage with the customer. Companys want to take the best out of the social media platforms as, A customer knowledge of brand is built through awareness and image(Keller 1993) and social media is the best match for companys to create awareness and build a positive image.B2B social media marketing is very different from B2C social media marketing and is really a tricky one. In B2C you can influence consumers by providing various deals but as B2B is more vertically structed the strategies need to be different as according to an analysis of inerbrands list of top 100 brands worldwide, only two could be considered to be B2B brands, Reuters and Boeing(Kochan,1996).The key factors that are needed to be looked upon when trying to build brand equity and brand image via social media marketing are

CONTENT BASED MARKETING :

The first and one of the important factor is content itself. It is the fundamental step of social marketing and we need to be very sure how do we want customers to see us also the content we say or share passes the message to the audience.

Content is the fuel needed to power effective social media campaigns that serve to inform, educate, entertain, persuade, engage and endure.(Rene Power) so yes meaningful content is very important. Content can be of three types: written,video and visual. By written content which is easy to manipulate we will share information about our company(where are our manufacturing plants located, insights, and information about cement industry) while through video and visuals, the aim would be to try and engage with consumers

MOBILE APPLICATION:

In the era of smartphones, it has almost become necessary for a company to launch mobile app for their brand. One one hand it helps the company to pass a messeage that we are evolving with the changing time while on the other hand it makes the job easy for the consumer.

Though using mobile app for a cement industry might seem to be new idea, but it could be a good one, it could prove to be a great success and we can include features like Calculate: With this feature the consumer would be easily able to calculate the quantity of cement required after providing some easy inputs, and hence it could make consumers work really easy. Order: With one click they will be able to place their orders and a systematic delivery date or more information can be provided Payment: Built in and hassle free payment can be also made available to the consumers.Many more interesting features can be included in the app to make it better and further help to build brand equity.

CREATING THOUGHT LEADERSHIP :

Under this strategy the main aim would be to focus on differentiation. With the help of various social media platforms a clear message will be passed what makes our product or service better than the other players.

But we need to be vary of the fact that to create thought leadership social media platforms arent enough, we will need to connect with promienent social media influencers who have bigger audiences following them. Because when someone else talks about the brand, it is than it catches the eyes of the consumers, infact they could be anyone: our customers or industry experts. And further we can post their blogs and tweets to our social media platform to communicate their words to even larger audiences.

SUCCESS STORIES:

When promoting a brand on social media platforms, sharing companys success story works out to be a very good plan. Under this, stories related to companys success (new project, acquiring new technology) as well stories of how a specific product has helped customers in the past will be shared on Facebook page or even on other platforms. This induces the sense of trust towards company in new and existing customers and even might help company to exploit emotional selling advantage, which is still scarcely used in B2B marketing. As we are talking about B2B marketing the emphasis would be how the firms efficiency helped our client to make delivery on time when the order was placed on a short notice or stories similar and how satisfied they are working with us. Thereby helping us develop a positive brand identity.

CONSUMER INTERACTION :

How do we interact with the consumer is also very important as there could be negative as well as positive response from the consumers. Generally handling positive comments from the consumer are easy but we need to be very active when it comes to the negative one as it could hurt the image of our brand and reduce trust amongst other consumers as well. All complaints should be handeled responsibly and respectfully, and further the full story should be made available to other customers, stating: what went wrong, how did we react or if there was any miscommunication between the two. To er is human nature and we are no different, but what needs to be taken care of is reaction as things can go viral very easily on social media.

Apart from this continuous post from the company are very important. At the beginning due to lack of original data we can follow a simple strategy that could be posting a mix of industry related post, reposts or retweets and posting our own company news.

PERFORMANCE:

Planning and execution are completely two different stages and both are very important. A good plan is nothing without a good execution, execution can be measured by tracking the performance of the company on various social media platforms or success of various campaign.It could be usefull to track what were the particular campaign or instances that were fairly successful or went viral or connected woth consumers sentiment and will further help to formulate strategies for future campaign. Tracking performance also gives a clear indication whether the company is on the right track to achieve the set benchmark or not.

QUESTION 4: Using theories and concepts from the class, discuss the impact of the following tag line and graphic for Patek Phillippe brand.

You never actually own a Patek Phillippe. You merely look after it for the next generation (Patek Phillipe, luxury Swiss watch maker, founded in 1839)

ANSWER:

You never actually own a Patek Phillippe. You merely look after it for the next generation

Brand like Patek Phillipe have been very successful in using Nostalgia as an important branding and marketing tool. To discuss the above mentioned tag line first we need to discuss more about how nostalgia helps various brands to differentiate their brands and command a price premium from their customers. And also why nostalgia is such an important branding tool in the current era.

NOSTALGIA:

Earlier nostalgia was viewed as ilness but then it was introduced as a quest for lost time(Proust) and now according to current oxford dictionary nostalgia is defined as a sentimental longing for the past.Generally the term nostalgia remains is hugely associated and confined to comsumer pshycology and advertising, further researches have presented how various product styles that were popular in the past(persons youth) can alter the individuals life long preferences. Nostalgia pertains to a personally experienced past, but not all past experience evokes nostalgia(www.wildschut.me: Nostalgia: Content,Triggers,Functions.N.p., 2015. Web.29 Apr.2015.)

NOSTALGIA AND MARKETING:

Nostalgia has become a very important tool in the contempary marketing. The main function of Nostalgia is to induce a memory of an experience which is generally done with the help of cues in music, taglines or the visual representation of the product, this proves to be a very good strategy to create a emotional link between consumer and the brand.Currently we are surrounded by Nostalgia from the Mini Cooper, Volks Wagen Beetle, remix music, revamped movies, everything consist a tinch of nostalgia.

WHY COMPANIES ARE PAYING EMPHASIS ON NOSTALGIA AS MARKETING TOOL:The most common things about successful company is that they understand their customers needs and wants. And what could be better than connecting with customers via the means of emotions hence we can say that,in todays market, positive memories that generate nostalgic feelings are an exploitable asset and all the brands want to take the best out of this situation.Moreover Nostalgia tends to increase the value of the company as it gives sense of reliablity, durability and good quality to the customers. Segmentation issues can also be countered by using nostagic themes which help them to expand their target market and also to create a link between generations.

The rise of Social networking(Facebook, twitter) has been a very good platform for various brands to connect with customers, also they try to reflect their companies belief and values via social media. Even sense of nostalgia can be passed via the help of this platform. Brands like BMW continuosly post stories from the past and the use of hashtags such as #tbt and #throwbackthursdays can be widely seen.

Not only brands but social networking sites also uses nostalgia to offer their users something new for example recently twitter started the campaign your first tweet and facebook also segments various activities according to months so that older posts could be easily accessible. They also started personalised Fb movies which a person could share it with their friends showing their journey with facebook till now.

PATEK PHILIPPE :

Patek Philipe is the one of the oldest watch maker company known for making elegant and innovative watches since 1839. Patek phillipe watches arent meant to last for a decade or two instead they are created with the quality and precision to last for generations.

Patek Phillippe is the perfect example of a brand providing its customer the blend of modern technology and tradition. And they have used nostalgia as the main tool for their advertisement. They aim at the trans generational nostalgic group

Patek Philipe and nostalgia can be associated very closely, their advertisement, website all reflect the sweet memories of the past. While on their website they boast about their unparralled quality, technology, heritage, value and other things but the feel they provide on their website is very traditional and seems as if there is some heritage linked with it.

Back in 1996 patek phillippe launched the generation campaign with the thought: begin your own tradition . Their advertisements showed an image of a father and a son which depicted the emotional bond between the two and also conveyed a message that a Patek Philippe is to man what jewellery is to woman that is a man could pass patek phillipe from generation to generation as woman could pass on their most precious jewellery from one generation to other. But later on the advertisement campaign were introduced with the tagline You never really own a Patek Philippe. You merely look after it for the next generation which really caught the customers imagination and is been used by the company ever since. This tagline perfectly captures the core value of the company that is, the watch is meant to last for generations which further adds to the value of the watch as it not only has the monetary value but the emotional value as well. Imagine an excellent piece of watch being passed on from your grandfather to your father and than to you, priceless. That is what Patek philippe conveys from their tagline.This advertisement campaign has fetched the company many positive results such as

Patek Philippe was the 2013 M&M global luxury brand of the year. Consistently ranks as the most desired watch brand globally. 94% brand awareness (Economist and Newsweek Brand Tracking).(earlier brand awareness was comparitively low) 89% advertising awareness (Economist and Newsweek Brand Tracking). 16% brand aspiration (highest in competitive set vs ownership).(Creativebrief.com)

The picture clearly passes two clear messages to the consumer that are Patek Philippe watches are created with such a good quality that it can run for generations which they second by providing lifetime service in other words the timelessness of watch and also Something truly precious holds its value forever. Just like the relationship between parent and child, a Patek Philippe watch gets better and becomes more appreciated with time (Crownandcaliber.com) Patek philippe as discussed is not some another brand instead is a one of the most expensive brand and company has been successful in justifying the price of the brand by providing equivalent value to its customer. The prestige of owning a patek phillipe makes it a possession for the customer, something that a persons buys once in a lifetime and passes on to future generation. In the contempary era where people have become more brand concious than ever known patek phillipe proves to be a status symbol that only elite can own. And yes to own a patek phillipe a person needs to apply with their personal information and might also have to wait fro few years to aquire this unparralled machine.

Hence we can conclude by saying that patek philippe uses nostalgia in the best way so that it could be easily associated with notion of inheritance, discerning taste and aspiration to own.

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