Brand Management

If all Coca-Colas asset were destroyed overnight. Whoever owned the Coca-Cola name could walk into a bank the next morning and get a loan to rebuild every thing Carlton Curtis VP Corporate Communications, Coca Cola

If this company were to split up I would give you the property, plant and equipment and I would take the brands & the trademarks and I would fare better than you John Stuart

CEO of Quaker Oats

Brands are Valuable

2009 Business week reports

Value of top 10 brands

US $ 422,901,000,000

& Top 100 brands

US $ 1,156,289,910,000

Rs. 98,369,387,350,000

United States

Beverages

68,734

2
3 4

United States
United States

Computer Services
Computer Software

60,211
56,647

United States

Diversified

47,777

Finland

Consumer Electronics

34,864

6 7

United States

Restaurants

32,275

United States

Internet Services

31,980

Japan

Automotive

31,330

9 10

United States

Computer Hardware

30,636

United States

Media

28,447

Why are Brands So Valuable???

Brands deliver value to both Firms & Consumers

Strong brands change consumer behavior in favor of the Company

They ease important functions and provide multiple benefits to the Consumers

Increase usage over time

Experimenting less with the competition

Less Vulnerable to price based competition

Brands are valuable because they change consumer behavior

Brands secure a future stream of profits

Require less marketing & sales investment

Paying a premium over other customers

Making Referrals

How does a Brand deliver value

A strong brand Gives Peace of mind

A strong brand transforms the consumption exp.

A Strong brand saves Cost & Time

A Strong brand gives consumers a good news story

A Strong brand helps us express ourselves: our attitudes, values and place in society

But What is a Brand?

According To AMA

"a name, term, sign, symbol or design or a combination of them, used to identify goods or services of one seller and to differentiate them from goods of competitors."

Brand is

A collection of perceptions in the mind of the consumers (all other stake holders).
Properly managed these perceptions secure long term revenue for the business and create lasting value

3 Key implications of this definition

A brand is very different from a product, a brand exist in the mind These perceptions if properly managed change the consumer behavior The role of advertising is to positively influence peoples perception

The Objective of BM
To build and maintain a Strong Brand
Motivating to the customers

Distinctive from Competition

Consistently delivered

Enduring over time

In line with business objectives

Very Important to Remember

Brand strength is directly proportionate to Brand Equity

A Strong Brand is one which has High Brand Equity

Remember
Brand value is built in the mind

Brands are built through every thing they do & say Brands draw strength from consistency over time
Market Leaders & Superior Brand performance are interlinked Market Leading brands tend to Have higher Profit Margins

Very Important to Remember

Customers usually never Understand the product or the company selling it Customers Perceive a Product in their own terms Customer Perception will focus on benefits, which are often intangible Customer perception is not always at the conscious level

Criteria of Success At the Product level it must deliver functional benefits to meet the market need al least as well as the competition

It must offer intangible benefits over and above the product

Criteria of Success The various benefits of a brand must be consistent with each other and present a unified character or personality

The values offered must be wanted by the consumer

A brand must be a blend of complementary physical. rational, and emotional appeals. The Blend must be distinctive and result in a clear personality that will offer benefits of value to customers

Some Branding Terms

Brand Essence / Brand Mantra The heart & soul of a brand, a brands fundamental nature or quality usually stated in two or there words Brand Promise A differentiated benefit the brand offers to the consumer Brand Positioning The way a brand is perceived by the consumers

Some Branding Terms

Brand Personality The adjectives that define a brand Brand Associations Any thing that a consumer associates in his mind with the brand Brand Identity This refers to a combination of visual, auditory and other components that create recognition, represent the brand promise, provide differentiation, creates communications synergy & proprietary

Some Branding Terms

Brand Architecture The family tree or brands hierarchy. It is how the organization organizes the various named entities in its portfolio Brand Portfolio The mix of brands a company possesses Master Brand The most dominant and highest level brand in the hierarchy. Corporate brands are master brands. Parent brand may or may not be the master brand

Some Branding Terms

Parent Brand This is a brand that has extended into more then one category

Sub-Brand A new brand that is combined with a parent or master brand

Brand Extension This refers to the introduction of the brand into a new product category or segment

Building Strong Brands

Short Term Pressures

Pressure to Compete on prices

Proliferation of Competitors

Pressure to invest elsewhere

Why it is difficult to build strong brands

Fragmenting Markets and Media

Bias Against Innovation

Bias towards changing the strategies

Complex Brand Strategies & Relationships

Building Strong Brands

BRAND EQUITY

Brand Equity Defined

The positive differential effect that knowing the brand name has on customers response to the product or service The commercial value of all associations (positive or negative) that people have of an organization and its products and services The power of the brand to shift the consumer demand curve of a product

It is a set of assets (and liabilities) linked to a brand its symbol that adds to or subtract the value provided

Asset Categories
There are 4 major elements that enhance brands equity, these elements are called asset categories These are 1. Brand Name Awareness 2. Brand Loyalty 3. Perceived Quality 4. Brand Associations

Implications
The management of brand Equity involves investment to create and enhance these assets Each brand equity asset creates value in a no of ways Brand equity creates value for customer and the firm as well

For assets to underlie brand equity, they must be linked to the name or symbol of the brand

How Asset Categories enhance Equity??

Brand Loyalty
Consumers Commitment to repurchase or continue using the brand Spurious Loyalty Due to unavailability of alternative or any other reason. True brand loyalty exists when customers have a high relative attitude toward the brand which is then exhibited through repurchase behavior

How Asset Categories enhance Equity??

Brand Loyalty
Willingness to pay high price Reduced Marketing Costs Trade Leverage

Attracting new Consumers - Create Awareness - Reassurance

Time to Respond to Competitive Threats

Brand

Awareness

measures consumers knowledge of a brand's existence

Brand Recognition
Recognition reflects familiarity with the brand. It is simply remembering that there was a past exposure to the brand

Brand Recall
The ability of a brand to come to mind when its product category is mentioned Deciding Factor in getting on a Shopping list

Where ?
Why? What?
No Concern

Brand Name Dominance Consumers can provide only the name of a single brand

How Asset Categories enhance Equity??

Brand Awareness
Anchor to Which Other Associations can be attached Familiarity Liking

Signal of substance/commitment
Brand To be Considered

How Asset Categories enhance Equity??

Perceived Quality
The customers perception of the overall quality or superiority of a product or service relative to its alternatives"

How Asset Categories enhance Equity??

Perceived Quality
Among all brand elements only perceived quality has been shown to drive financial performance Perceived quality is often the major (if not principal) thrust of a business Perceived quality is linked to and often drives the other aspects of how a brand is perceived

How Asset Categories enhance Equity??

Why Perceived Quality May Differ From Actual Quality?
Customer may be over influenced by a previous image of quality
A company may be achieving quality in a dimension which is not important to a consumer Customers rarely have all the information to make a sound judgment about quality- even if they do they lack the motivation and hence depend on 1 or 2 cues.

How Asset Categories enhance Equity??

Why Perceived Quality May Differ From Actual Quality?
Since they dont know how to best judge brands they may be looking at wrong cues

How Asset Categories enhance Equity??

Perceived Quality
Reason To Buy Differentiation / Position Price

Channel Member Interest

Extensions

How Asset Categories enhance Equity??

Brand Associations
Any thing linked in memory to brand"

How Asset Categories enhance Equity??

Brand Associations
Help Process or Retrieve information Reason to Buy Create Positive attitude / Feeling

Extensions

How Asset Categories enhance Equity??

Brand Loyalty Brand Awareness Brand Associations Perceived Quality

Value to customer Interpretation / processing of Information Confidence in the purchase decision

Value to Firm Efficiency & Effectiveness of marketing Program Brand Loyalty Prices / margins Brand extensions Trade Leverage Competitive Advantage

Use Satisfaction

Building Strong Brands

BRAND IDENTITY

Brand Identity
A unique set pf brand associations that a brand strategist creates or maintain. These associations represent what a brand stands for and imply a promise to customer from the organization members

A Brand identity should help establish a relationship between the brand and the customer by generating a value proposition involving functional, emotional or self expressive benefits

Brand Identity
Brand Image Trap
Brand Position Trap

Brand Identity Traps

External Perspective trap

Product Attribute fixation trap

Brand Identity

Brand Position Trap

Brand Position is that part of brand Identity & value proposition that is to b e actively communicated to the target audience and that demonstrates advantage over competition

Product Attribute fixation trap

When the strategic & tactical management of the brad focuses solely on product attributes, based on part on the erroneous assumption that those attributes are the only relevant basis for consumer decisions & competitive dynamics

Brand Identity

Product Attribute Research

The attribute fixation trap is the often caused by product attribute research Why?

It is often effective because attributes are important to the purchase decision and the use experience.
It is relatively easy since customers are more comfortable talking about attributes then about less tangible benefits

Brand Identity

Product Attribute Research

It reassures managers that customers evaluate brands using a logical model, which means that their decisions are easier to predict & understand

Brand Identity

Limitations of Product-Attribute based Identity

Fail to Differentiate Are easy to copy

Assume a rational customer

Limit brand extension strategies

Reduce strategic flexibility

Brand As A Product
Value Proposition
Functional

Brand As Organization

Credibility

Emotional

Brand Identity

Self Expressive

Brand As A Symbol

Brand As A Person

Brand Identity

Breaking out of the traps

A brand as a product perspective Identity based on brand as an organization perspective

A value proposition that includes emotional and self expressive benefits also
The ability of a brand to provide credibility The internal as well as an external role of brand identity Brand Characteristics broader then brand position

4 Brand Identity Perspectives

Brand Identity

The Brand as a Product

Product Related associations will almost always be an important part of a brand identity because they are directly linked to brand choice decision and the use experience

The Product Scope Association with a product class

Product related Attributes Quality / Value Association withy use occasion

Brand Identity

The Brand as a Product

Association with the users Link to a country or region

Brand Identity

The Brand as Organization

It focuses more on attribute of the organization then on attributes of products Organization attributes are more enduring & more resistant to competitive claims then are product attributes It is easy to duplicate products then to duplicate organizations Organizational attributes usually apply to a set of product classes, competitor in only 1 product classes may find it difficult to compete

Brand Identity

The Brand as Organization

Because organizational attributes such as innovation is hard to evaluate and communicate, it is difficult for the competitor to show that they have over come any perceived gap

Brand Identity

The Brand as a Person Brand Personality

A brand personality can create a stronger brand in several ways

Helps create a self expressive benefit which becomes a vehicle for person to express his/her personality Brand personality can be the basis for relationship between the customer and the brand

Brand Identity

The Brand as a Person Brand Personality

Brand personality may help communicate a product attribute and thus contribute to a functional benefit

Brand Identity

The Brand as a Symbol

A strong brand symbol can provide cohesion & structure to an identity and make it much easier to gain recognition and recall

Brand Identity

Brand- Providing A Value Proposition

A brands value proposition is a statement of functional, emotional & self expressive benefits delivered by the brand that provide value to the customer

An effective value proposition should lead to brand-customer relationship and drive purchase decision

Functional Benefits

Value Proposition
Emotional Benefits

Self Expressive benefits

Brand Identity

Functional benefits
The most visible and common basis for a value proposition If a brand can dominate a key functional benefit, it can dominate a category Limitations Attribute fixation trap

Brand Identity

Emotional benefits
When the purchase of a band gives the consumer a positive feeling, that brand is providing an emotional benefit Emotional benefits add richness and dept to the experience of use and owning of a brand To discover what emotional benefits are or could be associated with a brand

Brand Identity

Self Expressive Benefits

Russell Belk We are what we have is perhaps the most basic & power fact of consumer behavior

Brands can become the symbol of a persons self concept

Thus it provides a self expressive benefit by providing consumer a way to communicate their self image

Self expressive Vs emotional Benefits

At times there is a close relationship between emotional & self expressive benefits In general in comparison to emotional benefits, self expressive benefits focus on Self rather then feelings Public setting and products rather then private ones Aspirations and future rather then memories from the past

Self expressive Vs emotional Benefits

The permanent rather then transitory The act of using the product, rather then the consequences of using the product

Price
A brands price is also related to the benefits a brand provides Brands are not evaluated independent of price

A price too high relative to the benefits offered will severely undercut the value proposition
Functional Benefits Emotional Benefits Self Expressive Benefits Price

Value Proposition

Price
Price is a complex construct

The goal of identity creation & management is usually to focus on benefits rather then price Challenge is to make sure that the benefits are anchored to elements other then price

Brand Identity

Providing Credibility
At times the brand does not need to drive the purchase decision, but to endorse it

"A brand is the most valuable real-estate in the world, a corner of the consumer's mind."

A brand is a promise. By identifying and authenticating a product or service it delivers a pledge of satisfaction and quality."