Exam 1 (Branding Strategy)

What is the advantage of umbrella branding? (1)

1) Consumer trust - Once consumers trust the brand, the brand can extend in various ways to capitalize on existing feelings towards the brand

Why do we see so many brand extensions?

1) Consumers can alleviate boredom but stay in the family 2) Low cost to create awareness of new product within brand 3) Pricing breadth 4) Billboard effect

What are the advantages of distinct branding? (2)

1) Flexibility - can easily pursue new markets and customer segments 2) Minimizes damages from product failures

What are two forms of brand extensions?

1) Product line extensions 2) category extensions

What is 3C-STP-4P?

A marketing mix and strategic plan. AN ANALYTICAL TOOL

Who are we? (focuses on two components of marketing)

Branding strategy and core business

What are category extensions?

Category extensions are the use of an established product's brand name for a new item in a DIFFERENT product category (more than 50% of category extensions fail within 3 years) EX. Starbuck's ice cream

What is hybrid branding?

Combination of umbrella and distinct branding

What are the 3C's?

Company, Competition, Customer

What is Marketing?

Consensus definition - Art and science of meeting customer's needs profitably

What are we good at? (one component)

Core Compitences

Where are we going? (one component)

Define our goals

What is Targeting?

Determining which segments to target for marketing and which are the most attractive ones

What are product line extensions?

If a firm has a successful product it offers new items in the SAME product category that closely resemble the firm's existing products • They enhance growth, might cannibalize some of growth sales when acquiring a company

What is positioning?

Positioning is the target market's perception of the product's key benefits and features, relative to the offerings of competitive products.

What are the 4P's?

Product, Price, Placement, and Promotion

What is STP?

Segmentation, Targeting, Positioning

What is Segmentation?

The process of splitting a market into smaller groups with similar product needs or identifiable characteristics, for the puropse of selecting appropraite target markets.

Three types of branding strategies?

Umbrella, distinct, hybrid

What is distinct branding?

When firms offer several products with distinct meanings, names, and logos targeted to different audiences (sub-brands operate independently and with a separate market share and profits)

What is umbrella branding?

a family of products that all deliver the same higher-order benefit (all sub-brands use the same master brand and only differentiate in their description)

Consumers buy _____ not ______

brands, products

What is brand dilution?

occurs when a brand extension adversely affects consumer perceptions about the attributes the core brand is believed to hold