Download BUILDING, MEASURING, AND MANAGING BRAND EQUITY

BRAND MANAGEMENT
Bhushan D. Sudhakar, Ph.D
Assistant Professor & Co-ordinator (UG)
1
What is a Brand?
• A brand is a name, term, sign, symbol, or
design which is intended to identify the
goods or services of one seller or group of
sellers and to differentiate them from
those of competitors.
2
New Branding Challenges
• Brands are important as ever
– Consumer need for simplification
– Consumer need for risk reduction
• Brand management is as difficult as ever
– Savvy consumers
– Increased competition
– Decreased effectiveness of traditional
marketing tools and emergence of new
marketing tools
– Complex brand and product portfolios
3
The Customer/Brand Challenge
• In this difficult environment, marketers
must have a keen understanding of:
– customers
– brands
– the relationship between the two
4
The Concept of Brand Equity
• The brand equity concept stresses the
importance of the brand in marketing
strategies.
• Brand equity is defined in terms of the
marketing effects uniquely attributable
to the brand.
– Brand equity relates to the fact that different
outcomes result in the marketing of a product or
service because of its brand name, as compared
to if the same product or service did not have
that name.
5
The Concept of
Customer-Based Brand Equity
• Customer-based brand equity
– Differential effect
– Customer brand knowledge
– Customer response to brand marketing
6
Determinants of
Customer-Based Brand Equity
– Customer is aware of and familiar with the
brand
– Customer holds some strong, favorable, and
unique brand associations in memory
7
Building
Customer-Based Brand Equity
• Brand knowledge structures depend on . . .
– The initial choices for the brand elements
– The supporting marketing program and the
manner by which the brand is integrated into it
– Other associations indirectly transferred to the
brand by linking it to some other entities
8
Benefits of
Customer-Based Brand Equity
• Enjoy greater brand loyalty, usage, and
affinity
• Command larger price premiums
• Receive greater trade cooperation & support
• Increase marketing communication
effectiveness
• Yield licensing opportunities
• Support brand extensions.
9
Customer-Based Brand Equity
as a “Bridge”
• Customer-based brand equity
represents the “added value” endowed
to a product as a result of past
investments in the marketing of a
brand.
• Customer-based brand equity provides
direction and focus to future marketing
activities
10
The Key to Branding
• For 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 = VALUE
11
Strategic Brand Management
•
Strategic brand management involves the design
and implementation of marketing programs and
activities to build, measure, and manage brand
equity.
•
The strategic brand management process is
defined as involving four main steps:
1)
2)
3)
4)
Identifying and establishing brand positioning and values
Planning and implementing brand marketing programs
Measuring and interpreting brand performance
Growing and sustaining brand equity
12
Strategic Brand Management Process
STEPS
KEY CONCEPTS
Identify and Establish
Brand Positioning and Values
Mental maps
Competitive frame of reference
Points-of-parity and points-of-difference
Core brand values
Brand mantra
Plan and Implement
Brand Marketing Programs
Mixing and matching of brand elements
Integrating brand marketing activities
Leveraging of secondary associations
Measure and Interpret
Brand Performance
Grow and Sustain
Brand Equity
Brand Value Chain
Brand audits
Brand tracking
Brand equity management system
Brand-product matrix
Brand portfolios and hierarchies
Brand expansion strategies
Brand reinforcement and revitalization
13
Motivation for
Customer-Based Brand Equity Model
• Marketers know strong brands are
important but aren’t always sure how to
build one.
• CBBE model was designed to be …
– comprehensive
– cohesive
– well-grounded
– up-to-date
– actionable
14
Rationale of
Customer-Based Brand Equity Model
• Basic premise: Power of a brand resides in the
•
minds of customers
Challenge is to ensure customers have the right
types of experiences with products & services
and their marketing programs to create the right
brand knowledge structures:
–
–
–
–
–
Thoughts
Feelings
Images
Perceptions
Attitudes
15
Building
Customer-Based Brand Equity
• Building a strong brand involves a series of steps
•
as part of a “branding ladder”
A strong brand is also characterized by a logically
constructed set of brand “building blocks.”
– Identifies areas of strength and weakness
– Provides guidance to marketing activities
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CUSTOMER-BASED BRAND EQUITY PYRAMID
4. RELATIONSHIPS =
RESONANCE
What about you & me?
3. RESPONSE =
JUDGMENTS
FEELINGS
What about you?
2. MEANING =
PERFORMANCE
IMAGERY
SALIENCE
What are you?
1. IDENTITY =
Who are you?
17
Salience Dimensions
• Depth of brand awareness
– Ease of recognition & recall
– Strength & clarity of category membership
• Breadth of brand awareness
– Purchase consideration
– Consumption consideration
18
Performance Dimensions
• Primary characteristics & supplementary
features
• Product reliability, durability, and
serviceability
• Service effectiveness, efficiency, and
empathy
• Style and design
• Price
19
Imagery Dimensions
• User profiles
– Demographic & psychographic characteristics
– Actual or aspirational
– Group perceptions -- popularity
• Purchase & usage situations
– Type of channel, specific stores, ease of purchase
– Time (day, week, month, year, etc.), location, and context of
usage
• Personality & values
– Sincerity, excitement, competence, sophistication, & ruggedness
• History, heritage, & experiences
– Nostalgia
– Memories
20
Judgment Dimensions
• Brand quality
– Value
– Satisfaction
• Brand credibility
– Expertise
– Trustworthiness
– Likability
• Brand consideration
– Relevance
• Brand superiority
– Differentiation
21
Feelings Dimensions
• Warmth
• Fun
• Excitement
• Security
• Social approval
• Self-respect
22
Resonance Dimensions
• Behavioral loyalty
– Frequency and amount of repeat purchases
• Attitudinal attachment
– Love brand (favorite possessions; “a little pleasure”)
– Proud of brand
• Sense of community
– Kinship
– Affiliation
• Active engagement
– Seek information
– Join club
– Visit web site, chat rooms
23
Customer-Based Brand Equity Model
INTENSE, ACTIVE
LOYALTY
ConsumerBrand
Resonance
Consumer
Judgments
Brand
Performance
Consumer
Feelings
Brand
Imagery
Brand Salience
RATIONAL &
EMOTIONAL
REACTIONS
POINTS-OFPARITY &
POINTS-OFDIFFERENCE
DEEP, BROAD
BRAND
AWARENESS
24
Brand Positioning
• Define competitive frame of reference
– Target market
– Nature of competition
• Define desired brand knowledge
structures
– Points-of-parity
• necessary
• competitive
– Points-of-difference
• strong, favorable, and unique brand associations
25
Issues in Implementing
Brand Positioning
• Establishing Category Membership
• Identifying & Choosing POP’s & POD’s
• Communicating & Establishing POP’s &
POD’s
• Sustaining & Evolving POD’s & POP’s
26
Establishing Category
Membership
• Product descriptor
• Exemplar comparisons
27
Identifying & Choosing
POP’s & POD’s
• Desirability criteria (consumer
perspective)
– Personally relevant
– Distinctive & superior
– Believable & credible
• Deliverability criteria (firm
perspective)
– Feasible
– Profitable
– Pre-emptive, defensible & difficult to attack
28
Major Challenges in Positioning
• Find compelling & impactful points-
of-difference (MacMillan & McGrath,
HBR, ‘97)
– How do people become aware of their need for your
product and service?
– How do consumers find your offering?
– How do consumers make their final selection?
– How do consumers order and purchase your product
or service?
– What happens when your product or service is
delivered?
– How is your product installed?
29
Major Challenges in Positioning
• Find compelling & impactful pointsof-difference (cont.)
–
–
–
–
How is your product stored?
How is your product moved around?
What is the consumer really using your product for?
What do consumers need help with when they use
your product?
– What about returns or exchanges?
– How is your product repaired or serviced?
– What happens when your product is disposed of or no
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longer used?
Communicating & Establishing
POP’s & POD’s
• Create POP’s and POD’s in the face of
attribute & benefit trade-offs
–
–
–
–
–
–
–
–
Price & quality
Convenience & quality
Taste & low calories
Efficacy & mildness
Power & safety
Ubiquity & prestige
Comprehensiveness (variety) & simplicity
Strength & refinement
31
Strategies to Reconcile
Attribute & Benefit Trade-Offs
• Establish separate marketing programs
• Leverage secondary association (e.g., co-
brand)
• Re-define the relationship from negative to
positive
32
Sustaining & Evolving
POP’s & POD’s
• Core Brand Values &
Core Brand Proposition
33
Core Brand Values
• Set of abstract concepts or phrases that
characterize the 5-10 most important
dimensions of the mental map of a brand.
• Relate to points-of-parity and points-ofdifference
• Mental Map  Core Brand Values  Brand
Mantra
34
Brand Mantras
• A brand mantra is an articulation of the
“heart and soul” of the brand.
– Brand mantras are short three to five word
phrases that capture the irrefutable essence or
spirit of the brand positioning and brand values.
• Nike
– Authentic Athletic Performance
• Disney
– Fun Family Entertainment
35
Introduction to
Advertising
Outline
• The mandate for effectiveness
• What makes an ad effective?
• The world of advertising
• The five players of advertising
• The evolution of advertising
The Mandate for
Effectiveness
• Today advertising is in a bind
• Advertisers expect specific results that
lead to sales
• Advertising must be effective
37
What Makes an Ad
Effective?
• Effective ads work on two levels:
•
with consumers and with advertisers
Characteristics of effective ads:
– Strategy
–– Execution
– Advertising must be goal directed
38
The World of Advertising
Defining advertising
• A paid form of communication
• A sponsor is identified
• Tries to persuade or influence the
consumer to do something
• Conveyed through mass media
• Reaches a large audience
• Is nonpersonal
39
Types of Advertising
• Brand advertising • Business-to-business
advertising
• Retail/local
• Institutional
advertising
advertising
• Political
• Public service
advertising
advertising
(PSA)
• Directory
• Interactive advertising
advertising
• Direct-response
advertising
40
The Roles of Advertising
• Marketing role
• Communication role
• Economic role
• Societal role
41
Functions of Advertising
• Provide product and brand
information
• Provide incentives to take action
• Provide reminders and reinforcement
42
The Five Players of Advertising
• Advertiser
• Advertising agency
– The advertising department
– The in-house agency
• Media
• Vendors
• Target audience
43
The Evolution of Advertising
• Age of print
• Industrial revolution and emergence of
•
•
consumer society
Modern advertising: Agencies, science
and creativity
Accountability era
44
Current Advertising Issues
• Interactive advertising
• Globalization
• Niche marketing
• Integrated marketing communications
•
(IMC)
Consumer Power
45
How Brands Work
• Brand personalities
• Branding
• Trust
• Brand image
• Brand relationships
• Brand equity
46
MARKETING PLANNING PROCESS
Complex,
Varied
Marketing
Activity
Detailed,
Rich
Marketing
Models
Comprehensive,
Robust
Marketing
Measures
47
Role of Integrated Marketing
Communications
• Marketing communications …
– are the “voice” of the brand and are a means
by which it can establish a dialogue and build
relationships with consumers.
– allow marketers to inform, persuade, incent,
and remind consumers directly or indirectly
– can contribute to brand equity by establishing
the brand in memory and linking strong,
favorable, and unique associations to it.
48
Role of Integrated Marketing
Communications (Cont.)
– Consumers can be told or shown how and why a
product is used, by what kind of person, and where
and when;
– Consumers can learn about who makes the product
and what the company and brand stand for
– Consumers be given an incentive or reward for trial or
usage
– Brands can be linked to other …
• People
• Places
• Events
• Brands
• Experiences
• Feelings
49
• Things
Simple Test for
Marketing Communications
1.
3.
Current
Brand
Knowledge
2.
Desired
Brand
Knowledge
50
Integrated Marketing Communications
and Customer-Based Brand Equity
• One implications of the CBBE framework is
that the manner in which brand
associations are formed does not matter -only the resulting strength, favorability,
and uniqueness
51
Designing Integrated Marketing
Communications Programs
• From the perspective of customer-based brand
•
equity, marketers should evaluate all possible
communication options available to create
knowledge structures according to effectiveness
criteria as well as cost considerations.
Different communication options have different
strengths and can accomplish different
objectives.
52
Alternative Communication Options
(Consumer)
•
•
•
•
•
•
•
•
•
Media Advertising (TV, radio, newspapers, magazines)
Direct Response Advertising
Interactive (on-line) Advertising & Web Sites
Outdoor Advertising (billboards, posters, cinema)
Point-of-Purchase Advertising
Trade Promotions
Consumer Promotions
Sponsorship of Event Marketing
Publicity or Public Relations
53
Alternative Communication Options
(Business-to-Business)
•
•
•
•
•
•
•
•
•
•
•
Media Advertising (TV, radio, newspaper, magazines)
Trade Journal Advertising
Interactive (on-line) Advertising & Web Sites
Directories
Direct Mail
Brochures & Sales Literature
Audio-Visual Presentation Tapes
Giveaways
Sponsorship or Event Marketing
Exhibitions, Trade Shows, Conventions
Publicity or Public Relations
54
Print Ad Evaluation Criteria
• Is the message clear at a glance?
• Is the benefit in the headline?
• Does the illustration support the headline?
• Does the first line of the copy support or
explain the headline and illustration?
• Is the ad easy to read and follow?
• Is the product easily identified?
• Is the brand or sponsor clearly identified?
55
Ad Campaign Considerations
• Campaigns make brands -- not single ads
• Be creative and develop creative themes
– Avoid slavishly sticking to executional formulas
• Brand communications should sing like a choir
– Multiple voices
– Multiple notes
• Find fresh consumer insights & compelling brand
•
truths
Productively conduct ad research
56
IMC Case Study
CMPB Success Factors
• Smart strategy
– Relative deprivation
• Imaginative creative
– Funny but relevant
• Clever hook
– “Got milk?” slogan
• Timely secondary media
– In store
• Right partners
57
Common Mistakes in
Developing Advertising
• Failure to distinguish ad positioning (what
you say) from ad creative (how you say it)
• Mistaken assumptions about consumer
knowledge
• Improperly positioned
• Failure to break through the clutter
• Distracting, overpowering creative in ads
58
Common Mistakes in
Developing Advertising
(cont.)
• Under-branded ads
• Failure to use supporting media
• Changing campaigns too frequently
• Substituting ad frequency for ad quality
59
Audience Communication Option Overlap
Communication
Option A
Communication
Option B
Communication Option C
Note: Circles represent the market segments reached by various communication options.
Shaded portions represent areas of overlap in communication options.
60
Evaluating IMC Programs
• Coverage - what proportion of the target
audience is reached by each
communication option employed, as well as
how much overlap exists among options
• Cost - what is the per capita expense
61
Evaluating IMC Programs (cont.)
• Contribution - the collective effect on
brand equity in terms of
– enhancing depth & breadth of awareness
– improving strength, favorability, & uniqueness
of brand associations
• Commonality - the extent to which
information conveyed by different
communication options share meaning
62
Evaluating IMC Programs (cont.)
• Complementarity - the extent to which
different associations and linkages are
emphasized across communication options
• Versatility - the extent to which
information contained in a communication
option works with different types of
consumers
• Different communications history
• Different market segments
63
“Keller Be’s”
• Be analytical: Use frameworks of consumer behavior
•
•
•
and managerial decision-making to develop wellreasoned communication programs
Be curious: Fully understand consumers by using all
forms of research and always be thinking of how you
can create added value for consumers
Be single-minded: Focus message on well-defined
target markets (less can be more)
Be integrative: reinforce your message through
consistency and cuing across all communications
64
“Keller Be’s”
• Be creative: State your message in a unique
•
•
•
fashion; use alternative promotions and media
to create favorable, strong, and unique brand
associations
Be observant: Monitor competition,
customers, channel members, and employees
through tracking studies
Be realistic: Understand the complexities
involved in marketing communications
Be patient: Take a long-term view of
communication effectiveness to build and
manage brand equity
65