EMBA 26: Marketing Chapter 8

Flankers

-("fighter") brands -positioned with respect to competitors' brands so that more important (and profitable) flagship brands can retain their desired positioning -must not be so attractive that they take sales away from their high-priced comparison brands or designed so cheaply that they reflect poorly on them

Brand element choice criteria

-6 criteria: for building the brand: 1. memorable 2. meaningful 3. likable for defending the brand 4. transferable 5. adaptable 6. protectable -see pg 118, table 8.1

Brand

-American Marketing Association definition: 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 -adds dimensions that differentiate the offering in some way from other offerings designed to satisfy the same need; may be related to product performance (i.e., functional, rational, or tangible); may be related to what the brand represents (i.e., symbolic, emotional, or intangible)

What is a brand worth

-Interbrand developed 1. market segmentation 2. financial analysis 3. role of branding 4. brand strength 5. brand value calculation

Brand audit

-a consumer-focused series of procedures to assess the health of the brand, uncover its sources of brand equity, and suggest ways to improve and leverage its equity -should conduct when: 1. setting up marketing plans; and 2. when considering strategic shifts -allows marketers to manage brands proactively and responsively

Integrated marketing

-about mixing and matching marketing activities to maximize their individual and collective effects -marketers need a variety of different marketing activities that consistently reinforce the brand promise -successful cult brands are built on creative and consistent integrated marketing

Brand asset valuator

-advertising agency Young and Rubicam's model -measures 4 pillars of brand equity: energized differentiation, relevance, esteem, knowledge (see pg 116, figure 8.1) -strong new brands show higher levels of differentiation and energy than relevance, whereas both esteem and knowledge are lower still -leadership brands show high levels on all pillars -declining brands show high knowledge, a lower level of esteem, and even lower relevance, energy, and differentiation

Customer equity

-aim of customer relationship management (CRM) is to produce higher customer equity -sum of lifetime values of all customers -focuses on bottom-line financial value and offers limited guidance for go-to-market strategies and brand-building, not fully accounting for competitive actions, social network effects, word of mouth, and customer-to-customer recommendations

Brand resonance model

-also views brand building as an ascending series of steps -enacting 4 steps (relationships, response, meaning, identity) means establishing a pyramid of six "brand building blocks" (resonance, judgements and feelings, peformance and imagery, and salience) -rational route on left side and emotional route on right side -see pg 117, figure 8.3

Brand contact

-any information-bearing experience, whether positive or negative, a customer or prospect has with the brand, its product category, or its market

Brand revitalization

-any new development in marketing environment can affect a brand's fortune -first, understand the original sources of brand equity (i.e., are positive associations losing their strength or uniqueness? have negative associations become linked to the brand?) -next, decide whether to retain the same positioning or create a new one; "back to basics" strategy or pure "reinvention" strategy

Brand equity models

-brand asset valuator -brandZ -brand resonance model

Developing brand elements

-brand should be easy to recall and inherently descriptive and persuasive -likability of brand elements may also increase awareness and association

Advantages of brand extensions

-can improve the odds of new-product success, b/c consumers form expectations about a new product based on what they know about the parent brand and the extent to which they feel this information is relevant -may be easier to convince retailers to stock and promote -reduce launch costs -can provide feedback benefits

Brand tracking studies

-collect quantitative data from consumers over time to provide baseline information about how brands and marketing programs are performing -show where, how much, and in what ways brand value is being created, to facilitate marketing decision making

Strategic brand managment

-combines the design and implementation of marketing activities and programs to build, measure, and manage brands to maximize their value and strengthen customer loyalty -process 1. identifying and establishing brand positioning 2. planning and implementing brand marketing 3. measuring and interpreting brand performance 4. growing and sustaining brand value

Internal branding

-consists of activities and processes that help inform and inspire employees -marketers must adopt an internal perspective to be sure employees and marketing partners appreciate and understand basic branding notions and how they help, or hurt, brand equity -"walk the walk" to deliver brand promise

Building brand equity

-depends on all brand-related contacts- whether marketer-initiated or not -3 brand equity drivers: 1. initial choices for the brand elements or identities making up the brand (brand names, URLs, logos, symbols, characters, spokespeople, slogans, jingles, packages, and signage) (i.e., microsoft chose the name bing for its search engine b/c it conveys search and the "aha" moment of finding what a person is looking for; also short, appealing, memorable, active, and effective multiculturally) 2. product and service and all accompanying marketing activities and supporting marketing programs (i.e., Liz Claiborne's fastest-growing clothing brand is Juicy Couture, marketed as affordable luxury with an edgy lifestyle appeal and limited distribution 3. other associations indirectly transferred to the brand by linking it to some other entity (a person, place, or thing); secondary brand associations (i.e., brand name of New Zealand vodka 42BELOW refers to both a latitude that runs through New Zealand and the percentage of its alcohol content)

Brand valuation

-different from brand equity -job of estimating the total financial value of the brand accounts for over half the total market capitalization -Interbrand developed a model to estimate the dollar value of a brand

Branding

-endowing products and services with the power of a brand -all about creating differences between products -firm needs to teach consumers "who" the product is by giving it a name and other brand elements to identify it, as well as what the product does and why consumers should care -creates mental structures that help consumers organize their knowledge about the offering in a way that clarifies their decisions making and provides value to the firm -create brand value

Brand extensions

-firms leverage their most valuable asset by introducing new products under their strongest brand names -success should be judged by how effectively it fits with and leverages existing brand equity from the parent brand, as well as how it contributes to the parent brand's equity from the parent brand, as well as how it contributes to the parent brand's equity and profitabitiy

Role of brands

-identify the source or maker of a product and allow consumers (either individuals or organizations) to assign responsibility for its performance to a particular manufacturer or distributor -perform valuable functions for firms 1. simplify product handling or tracing 2. help to organize inventory and accounting records 3. offers the firm legal protection for unique features or aspects of the product -brand names can be protected through patents and packaging can be protected through copyrights and proprietary designs -credible brand signals a certain level of quality so that satisfied buyers can easily choose the product again -brand loyalty provides predictability and security of demand for the firm, and it creates barriers to entry that make it difficult for other firms to enter the market

Measuring brand equity

-indirect approach: assesses potential sources of brand equity by identifying and tracking consumer brand knowledge structures -direct approach: assesses the actual impact of brand knowledge on consumer response to different marketing aspects -marketers need to fully understand: 1. the sources of brand equity and how they affect outcomes of interest; brand audits important 2. how these sources and outcomes change, if at all, over time; brand tracking important

BrandZ (BrandDynamics)

-marketing research consultants Millward Brown and WPP -brand building follows a series of steps leading from a weak to a strong brand relationship (see pg 116, figure 8.2) -"bonded" consumers at the top of the pyramid build stronger relationships with and spend more on the brand than those at lower levels

Disadvantages of brand extensions

-may cause the brand name to be less strongly identified with any one product -brand dilution: when consumers no long associate a brand with a specific product or highly similar set of products and start thinking less of the brand -extension may fail and harm the parent brand -cannibalizing the parent brand

Branding strategy

-reflects the number and nature of both common and distinctive brand elements -3 choices: 1. develop new brand elements for the new product 2. apply some of its existing brand elements 3. use a combination of new and existing brand elements (brand extension, sub-brand, parent brand, master or family brand, line extension, category extension, brand line, brand mix, branded variants, licensed product) (see pg 122, table 8.2)

Brand reinforcement

-reinforce brand equity by consistently conveying the brand's meaning in terms of: 1. what products it represents, what core benefits it supplies, and what needs it satisfies 2. how the brand makes products superior, and which strong, favorable, and unique brand associations should exist in consumers' minds -brand must always be moving forward in the right direction, with new and compelling offerings and marketing -when change is necessary, marketers should vigorously preserve and defend sources of brand equity

High-end prestige

-relatively high-priced brand can add prestige and credibility to the entire portfolio

Cash cows

-some brands may be retained despite dwindling sales b/c they remain profitable with virtually no marketing support -companies can "milk" these "cash cows" by capitalizing on their reservoir brand equity

Brand community

-specialized community of consumers and employees whose identification and activities focus around the brand -3 characteristics: 1. a sense of connection to the brand, firm, product, or other community members 2. shared rituals, stories, and traditions that help convey meaning 3. shared responsibility or duty to the community and individual members -strong brand community results in a more loyal, committed customer base -i.e., Harley Owners Group

Brand equity

-the added value endowed on products and services -may be reflected in the way consumers think, feel, and act with respect to the brand -consumer-based brand equity -brand knowledge -brand promise

Consumer-based brand equity

-the differential effect brand knowledge has on consumer response to that brand's marketing -positive when consumers act more favorably to a product -negative if consumers react less favorably -3 key ingredients: 1. brand equity arises from differences in consumer response; if no difference, the brand-name product is essentially a commodity and competition will probably be based on price 2. differences in response are a result of consumer's brand knowledge (all the thoughts, feelings, images, experiences, and beliefs associated with the brand) 3. brand equity is reflected in perceptions, preferences, and behavior related to all aspects of the brand's marketing

Brand promise

-the marketer's vision of what the brand must be and do for consumers -consumers decide based on what they think and feel about the brand, where (and how) they believe the brand should go and grand permission (or not) to any marketing action or program

Low-end entry level

-the role of a relatively low-priced brand in the portfolio may be to attract customers to the brand franchise -"traffic builders" b/c they are able to "trade up" customers to a higher-priced brand

Brand porfolios

-the set of all brands and brand lines a particular firm offers for sale in a particular category or market segment -to maximize market coverage so no potential customers are being ignored, but minimize brand overlap so brands are not competing for customer approval -flankers -cash cows -low-end entry level -high-end prestige

Secondary brand associations

-third way to build brand equity is to "borrow" it by linking brand to other information in memory that conveys meaning to consumers -see pg 119, figure 8.4

Brand elements

-trademarkable devices that identify and differentiate the brand -i.e., Nike has the distinctive "swoosh" logo and the "Nike" name from the winged goddess of victory -brand element choice criteria -developing brand elements

Branding decisions

-which brand to use? 3 strategies: 1. individual or separate family brand names: if a product fails or seems to be low quality, the company's reputation is not hurt b/c the brands are separate; use different brand names for different quality lines within the same product class; "house of brands" strategy: use of individual or separate family brand names 2. corporate umbrella or company brand name: use corporate brand as an umbrella brand across their entire range of products; development costs are lower, sales are likely to be strong if the manufacturer's name is good; "branded house" strategy: the use of an umbrella corporate or company brand name 3. sub-brand name: combine two or more of the corporate brand, family brand, or individual product brand names; company name legitimizes, and the individual strategy falls somewhere between, depending on which component of the sub-brand receives more emphasis; falls somewhere between "house of brands" and "branded house"