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It is the added value endowed on products & services. It may be reflected in the way consumers think, feel & act with respect to the brand, as well as in the prices, market share & profitability the brand commands.
Positive or negative brand equity
Product/Service with positive brand equity deliver value to the customer based on its quality, experience, durability, availability, services. Companies charge more premiums indicate higher brand equity. Negative one has a worst impact on the company image. This may be due to poor quality, bad experience with the product, bad word of mouth & most important poor performance of the previous products& services.
Strategic Brand management Process
Involves the design & implementation of marketing programs & activities to build, measure & manage brand equity.
Steps in Strategic Brand management Process
Identify & establish brand positioning & values
Plan & implement brand Marketing programs
Measure & interpret brand performance
Grow & sustain Brand equity
1. Identifying & establishing brand positioning & values
Kotler defines “ act of designing the company’s offer & image so that it occupies a distinct & valued place in the target customer’s mind”. Positioning often involves specifications of core brand values & brand mantra. “Core brand values are set of abstract associations ( attributes & benefits) that characterize a brand”. A brand mantra is a short 3-5 word expression of the most important aspects of a brand & its core values. A brand represents a brand mantra, also known as the brand essence or core brand promise. A brand audit is a comprehensive examination of a brand, involving activities to assess the health of the brand, uncover its sources of equity & suggest ways to improve it.
2. Planning & implementing brand marketing programs
This is a knowledge building process & depends upon : 1. Choosing brand elements A brand element is visual or verbal information that serves to identify or differentiate a product like brand names, logos, symbols, characters, packaging & slogans. 2. Integrating the brand into marketing activities & the supporting marketing program The primary input comes from the marketing activities, strong, favorable & unique brand associations by means of marketing programs
Leveraging Secondary associations.
A brand association may be created by linking the brand to another node or information in memory that conveys meaning to consumers. Like the brand may be linked to certain source factors like company, country or geographic regions, channels of distribution, characters etc
3. Measuring & interpreting brand performance
A useful tool to measure is the brand value chain. This is used to trace the value creation process for brands to better understand the financial impact of brand marketing expenses & investments. A brand equity measurement system is a set of research procedures designed to provide timely, accurate & actionable information for marketers to make the best possible tactical decision in the short run & the best strategic decision in the long run.
Brand Value Chain
Marketing Program investment Customer mindset Market Performance Shareholder value
Market Place Conditions
4. Growing & Sustaining brand equity
1. 2. 3.
Defining the branding strategy Managing brand equity over time Managing brand equity over geographic boundaries , cultures & market segments
Customer Based Brand equity
What makes a brand strong? How do u build a strong brand? These questions are dealt by CBBE model. This model approaches from the perspective of consumers- both individual or an organization. Basic premise of the CBBE model is that the power of a brand lies in what the customers have learned, felt, seen & heard about the brand as a result of their experiences over time. OR The power of a brand lies in what resides in the minds of customers.
Brand is said to have a positive CBBE when consumers react more favorably to a product & the way it is marketed. Thus with a positive CBBE, this may results in consumers being more accepting of a new brand extension., less sensitive to price increases. On the contrary a brand is said to have a negative CBBE if consumers react less favorably to marketing activity.
3 key points in these concepts
1. Differential effect: 2. Brand knowledge: 3. Consumer response:
Brand equity as a bridge
Customer knowledge drives the difference that manifests themselves in terms of brand equity. Brands as a reflection of the past. Amount spend each year on marketing & manufacturing are not expenses but investments Brands as direction for the future. The true value &future prospects of a brand rest with consumers & their knowledge about the brand.
CBBE model states that brand knowledge is the key to create brand equity, as it creates the differential effect that drives brand equity. A Brand is essentially a marketer’s promise to deliver predictable product or service performance. A Brand promise is the marketer’s vision of what the brand must be & do for the consumers. Brand knowledge Brand Awareness Brand Image
Brand awareness: Strength of the brand node or trace in memory as reflected by consumers ability to identify the brand.
Brand Image: Perceptions about a brand as reflected by the brand associations held in consumer memory. E.g.:
User friendly Apple computers Apple computers Cool
Creative Graphics Apple logo
Sources of Brand Equity
CBBE occurs when the consumer has a high level of awareness & familiarity with the brand & holds some strong, favorable & unique brand associations in memory. Key to branding is that consumers must not think that all brands in the category are the same. Brand Awareness Brand Image
This consists of brand recognition & brand recall performance. Brand recognition relates to consumers ability to confirm prior exposure to the brand. e.g. when consumers go to the store, is it the case that they ill be able to recognize the brand as one to which they have already been exposed?
Brand Recall relates to consumers ability to retrieve the brand from memory when given the product category, the needs fulfilled by the category, or a purchase. e.g. recall of Kellogg's corn flakes will depend on consumer’s ability to retrieve the brand when they think of the cereal category or what they should eat for breakfast either at the store ( when making a purchase), at home ( when making a consumption choice), or wherever.
If a product decision is made in the store, brand recognition may be more important because the brand will actually be physically present.
Outside a store where the brand is not present, it is probably more important that the consumer will be able
to actually recall the brand from memory?
Consequences of Brand awareness
Brand awareness plays an important role in consumer decision making for 3 major reasons: Learning Advantages Consideration advantages Choice advantages
1. 2. Consumer purchase motivation. Consumer purchase ability.
Establishing Brand Awareness
This is created by increasing the familiarity of the brand through repeated exposure. It’s more of a consumer experience rather than by seeing it, hearing it or thinking about it. Anything that causes consumers to experience a brand name,symbol,logo,character,packaging that can increase familiarity & awareness of that brand element.
Advertising, promotion, sponsorship, event marketing, publicity & PR.
2. Brand Image
With a positive brand image a strong link, favorable & unique brand association are created in the memory.
Strength of Brand associations
Favorability of Brand associations
Uniqueness of Brand associations.
Building Brand Equity
Marketers build brand equity by creating the right brand knowledge structures with the right consumers. There are 3 main sets of brand equity drivers. The initial choices for the brand elements making up the brand ( brand names, logos, URL’s, slogans etc..) The product/Service & all accompanying marketing activities & supporting marketing programs. Other associations indirectly transferred to the brand by linking it to some other entity ( person, place or thing…)
1. 2. 3.
Pe N rs e w pe c m ar on tive ke tin g
Marketin g Program s
Cha Str nne ate l gy
g in y ic eg Pr rat St
Economic reasons, Technological, Political & legal, Socio-cultural, Competitive environment. The reasons/drivers Digitalization and connectivity, Disintermediation and reinter mediation, Customization and customerization, Industry convergence, New customer and company capabilities.
Customers/consumers Substantial increase in customer power Greater variety of available goods and services Greater amount of information about practically anything. Greater ease in interacting and in placing and receiving orders. An ability to chat with strangers and compare note on products and services.
Company Operate a powerful new information and sales channel. Broad area coverage Knowledge about markets, customers, competitors Ability to communicate customer and prospects Facility regarding transaction efficiency. Can customize their offering and services to individual customers
Personalizing marketing Experiential marketing Focuses on customer experience … on the consumption situation View customers as rational and emotional One-to-one marketing Shifting from transaction mar. to relationship marketing. Focus on individual through data base Customize products and services Permission marketing
Reconciling the new marketing approaches Various new approaches and others help to reinforce a number of important marketing concepts and techniques. From a branding point of view, they are particularly useful means of thinking how to both elicit positive brand responses and create brand resonance to build customer based brand equity.
Product itself is at the heart of brand equity because it is the primary influence on what consumers experience with brand. Designing and delivering a product and services that satisfies customer’s needs and wants. Perceived Quality and value Relationship marketing
Perceived Quality and value Performance Features Conformance quality Reliability Durability Serviceability Style and design Brand intangibles Total quality management an return on quality Value chain
Relationship marketing It attempts to provide a more holistic, personalized brand experience to create stronger customer ties. Mass customization After marketing Loyalty programs Know your customers Change is good Listen to your best customers Engage people
Customer price perceptions Setting prices to build Brand equity Value pricing Product design & delivery Product costs Product prices Pricing methods
For new products Skimming pricing/price skim Penetration pricing For existing product Cost oriented pricing Demand oriented pricing Competition oriented pricing
Cost oriented pricing Cost plus pricing Target pricing method Break even pricing Marginal cost & incremental Demand oriented pricing Purchasing power parity pricing Skimming policy Penetration policy Competition oriented pricing Discount pricing Premium pricing Follow the leader pricing
Channel design Indirect channels Direct channels Web strategy Level of channels
What should be the channel of distribution for the product? What should be the length? What will be the cost of distribution? What should be the criteria for appointing intermediaries?
Importance Distribution channel is an important element of marketing mix. The cost involved in distribution channel extend the product price. A product is really useful only when it reaches the customer at the right time at the right place. The right choice of the channel of distribution will reduce the fluctuation in the production.
– – – – – Product information needs are high Product customization is high Product quality assurance is important Purchase lot size is important Logistic are important
Company owned stores Shops in the department stores/malls
– – – A board assortment is essential Availability is critical After sale service is important
Push & pull strategy Channel support
www.homeshop18.com www.ebay.in shopping.indiatimes.com www.toponlineshopping.com www.futurebazaar.com www.indiaplaza.in www.mps-shopping.com
Levels of the channel
Manufacturers – consumers
Manufactures – distributors—consumers
Manufacturers– distributors– wholesalers- consumers
Manufacturers- distributors- wholesalers- retalers-consumers
Presented By: Prasun Kumar Shruti Raghuwanshi
IMC is a communication process that entails the planning, creation, integration and implementation of diverse forms of marcom (adverts, sales promotion, publicity) that are delivered over time to a brand’s targeted customers and prospects.
Moving away from traditional marketing
TV, radio, newspaper and magazines
Moving towards more modern marketing techniques
Online methods such as blogs and brand communities
Connecting with customers requires thinking beyond traditional methods (think out of the box) Essential that marketers redesign the way they communicate with their customers
Redesigning brand-building communications marketers must remember that the following 6 steps must occur of the information processing model:
Exposure Attention Comprehension Yielding Intensions Behaviour
A consumer may not be exposed to an Ad because the media plan missed the mark. A consumer may not notice an Ad because of a boring and uninspired strategy. A consumer may not understand an Ad because of a lack of product category knowledge or technical sophistication, or because of a lack of awareness and familiarity about the brand itself. A consumer may fail to respond favorably and form a positive attitude because of irrelevant or unconvincing product claims. A consumer may fail to form a purchase intention because of a lack of an immediate percieved need. A consumer may fail to actually buy the product because he/she doesn’t remember anything from the Ad when confronted with the available brands in the store
The right consumer is exposed to the right message at the right place and at the right time. The creative strategy for the advertising causes the consumer to notice and attend to the Ad but does not distract from the intended message. The Ad properly reflects the consumer’s level of understanding about the product and the brand. The Ad correctly positions the brand in terms of desirable and deliverable points of difference and point of parity. The Ad motivates consumers to purchase of the brand. The Ad creates strong brand associations to all of these stored communication effects so that they can have an effect when consumers are considering making a purchase.
Current Brand Knowledge
Desired Brand Knowledge
Possible to employ multiple communication to achieve goals Understand how each communication method works and leverage of the positive aspects of method
TV, Radio, Print, Direct response, Interactive and Outdoor
Consumer promotions and Trade promotions
Event marketing and sponsorship Public relations and Publicity
Advertising is any paid form of nonpersonal presentation and promotion of ideas, goods or services by an identified sponsor Powerful way of creating strong, favourable and unique brand associations. (Keller’s Brand Knowledge Model)
Medium of Advertising Television
Mass Coverage Short message life Impact of sight, sound and High absolute and motion production costs Low cost per thousand Clutter
It is important that when designing the ad campaign that marketers take into account both the message or positioning (what ad is attempting to convey about the ad) and the creative strategy (the way the ad expresses the brand claims).
Competitive frame of reference
Nature of competition Target Market
Informational (benefit elaboration)
Problem solution Product comparisons Testimonial
Point of parity attributes and benefits
Transformational (imagery portrayal)
Usage situation User of product Brand personality and values
Point of difference attributes and benefits
Humor Sex appeal Fear
Medium of Advertising Radio
Low cost Audio only Local coverage – well Low attention getting segmented audience capabilities flexibility Clutter
Radio is of a low involvement nature and has limited sensory options therefore advertising pioneer David Ogilvy suggests that the advert must include 4 critical factors: 1.Identify your brand early in the commercial 2.Identify it often 3.Promise the listener a benefit early in the commercial 4.Repeat it often
Medium of Advertising Magazines
Advantages High information content Longevity Multiple readers High coverage at low cost Short lead time for placing ads Timely (current ads)
Disadvantages Long lead time for ad placement Visual only Lack of flexibility Short life Poor reproduction quality Selective reader exposure
Usually readers only glance at the most visible elements of print ads. Hence it is important to be direct: Clarity, Consistency and Branding Consistency is key in creating brand awareness and strong brand associations
Use of mail, telephone, internet and other non-personal contact tools to communicate with customers and prospects. Purpose is to elicit some type of behaviour from the consumer e.g. use of infomercials
Medium of advertising Direct Response
Advantages High selectivity Reader controls exposure High information content Easy to establish relationships.
Disadvantages High cost per customer Poor image Clutter
Websites Customers go online to search for info Websites must convey consumer relevant info e.g. P&G pampers.comgives baby and parenting advice Interactive adverts Mobile marketing Build a platform for solid relationships
Medium of advertising Interactive
Advantages Customized and personal Engaging
Disadvantages Often lack emotionality
Non-traditional, alternative or supportive form of advertising Idea behind it is to give marketers an alternative environment in which to promote their products. Examples: movies house adverts, product placement and point of purchase advertising. Medium of advertising Outdoor Advantages Location specific High repetition Easily noticed Disadvantages Short exposure time Local restrictions
Short term incentives to encourage trail & usage of a product or service Trade consumers
Financial incentives/discounts given to retailers, distributors, etc Slotting allowances, POP displays, contests, cooperative ads
Designed to change the choices, quantity or timing of consumer product purchases
Advantages • Incentive to buy • Manufacturers can price discriminate • Traders can maintain full stocks Disadvantages • Decrease brand loyalty • More brand switching • Decreased quality perceptions • Increased price sensitivity
EVENT MARKETING & SPONSORSHIP
Public sponsorship of events or activities related to sport, art, entertainment or social causes
(Castle lager + soccer, Standard Bank + cricket, FIFA)
Sponsors become part of a personally relevant moment in consumers’ lives & are able to broaden & deepen the relationships with their target market
Advantages • Identify with a particular target market of lifestyle • Increase awareness of company or brand name • Create or reinforce consumer perceptions of key brand image associations • Enhance corporate image dimensions • Create experiences and evoke feelings • Express commitment to community or social issues • Entertain key clients or reward key employees • Permit merchandising or promotional opportunities
PUBLIC RELATIONS & PUBLICITY
Programs that are designed to promote or protect a company’s image or products Publicity
Nonpersonal communication such as press releases, media interviews, feature articles, etc
Public Relations +Annual reports, fund raising, lobbying, etc Buzz Marketing (only works for high-interest products)
Face-to-face interaction with prospective customers for the purpose of making sales
Advantages Disadvantages • Send a detailed, customized • High costs • Lack of breadth message • Marketers can gather feedback to close the sale • Easier identify prospective buyers • Tailor solutions to their needs • Demonstrate product usage
Developing IMC Programs
Speak with a single voice
Criteria for IMC Programs
1. Coverage (proportion of audience reached) 2. Contribution (ability to create desired response) 3. Commonality (create a consistent brand image 4. Complementarity (extent to which different
associations are emphasised across marcoms) different groups of consumers)
where brand associations share content & meaning)
5. Versatility (robustness & effectiveness for 6. Cost (effective & efficient programs)
Using IMC Choice Criteria
Evaluating communication options Establishing priorities & tradeoffs Executing final design & implementation
1.Coverage Breadth Depth 2. Contribution 3. Commonality 4.Complementar y 5.Versatility 6. Cost
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Commonality and Complementarity will often be inversely related. Versatility and Complementarity will also often be inversely related. Commonality and Versatility do not share an obvious relationship.
General Marcoms Guidelines
1. 2. 3. 4. 5. 6. 7. 8. Be analytical Be curious Be single-minded Be integrative Be creative Be observant Be patient Be realistic
Coordinating Media to Build Brand Equity
Factors Creating Weak Brand Links
Competitive Clutter Ad Content & Structure Consumer Involvement
Strategies to Strengthen Communications Effects
Brand Signatures Ad Retrieval Cues Media Interactions
TV Ads over Time
How does IMC contribute to Brand Equity?