MARCOM CHALLENGES

:
Enhancing Brand Equity, Influencing Behaviour and Being Accountable

Chapter Objectives
After reading this chapter you should be able to: 1. Explain the concept of brand equity from both the company¶s and the customer¶s perspectives. 2. Describe the positive outcomes that result from enhancing brand equity. 3. Appreciate a model of brand equity from the customer¶s perspective. 4. Understand how marcom efforts must influence behavior and achieve financial accountability..

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Introduction: Framework for Marcom Process

Fundamental Decisions

Implementation Decisions

Desired Outcomes

Evaluation and Corrective Action

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Basic IMC Issues

Marketing Communicators

How to enhance brand equity

How to affect customer behavior

How to justify marcom investments

How to demonstrate financial accountability

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Brand ‡ Brand 
Is a name, term, sign, symbol, or design.  Identifies and differentiates goods and services of one

seller or group of sellers from those of the competition.  Communicates a particular set of values.

‡ Brand Equity 
Can be considered either from the perspective of the

organization that owns it or from the vantage point of t the customer.  Is valuable when consumers believe the brand can deliver on its promises. 5

A Firm-Based Perspective on Brand Equity Firm-

Effects of Brand Equity Increases

Higher market share

Increased brand loyalty

Premium pricing

Revenue premiums

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Brand Equity Increases Revenue Premium 
The revenue differential between a branded item and

a corresponding private labeled item. 
Revenue premium for a branded item (b) compared to

a private label (pl) =

(volumeb)(priceb) ± (volumepl)(pricepl)

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A Customer-Based Brand Equity Framework

Source: Adapted from Kevin Lane Keller, ³Conceptualizing, Measuring, and Managing Customer-Based Brand Equity,´ Journal of Marketing 57 (January 1993), 7.

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The Brand Awareness Pyramid

Source: David A. Aaker, Managing Brand Equity (New York: Free Press, 1991), 62.

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Forms of Brand Knowledge
‡ Brand Awareness 
Whether a brand name comes to mind when

consumers think about a particular product category  The ease with which the name is evoked

‡ Brand Image 
The types of associations that come to the

consumer¶s mind when contemplating a particular brand

‡ Top-of-Mind Awareness (TOMA) 
Occurs when a brand is the first brand that

consumers recall when thinking about brands in a particular product category. 0

Brand Associations

Brand image associations that build brand equity

Positive Attributes

Perceived Benefits

Favorable Attitude

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Dimensions of Brand Personalities

Sincerity

Excitement

Competence

Sophistication

Ruggedness

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Ways of Enhancing Brand Equity

Enhancing Brand Equity

Speak-for-Itself

Message-Driven

Leveraging

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Leveraging Brand Meaning from Various Sources

Source: Kevin Lane Keller, ³Brand Synthesis: The Multidimensionality of Brand Knowledge,´ Journal of Consumer Research 29 (March 2003), 598. By permission of the University of Chicago Press.

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Types of Branding for Leveraging

‡ Co-Branding Co A partnership between two brands

‡ Ingredient Branding 
Inclusion of one brand within the other

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What Benefits Result from Enhancing Brand Equity?
‡ Increased consumer loyalty ‡ Long-term growth and profitability for the Longbrand ‡ Maintain brand differentiation from competitive offerings ‡ Insulate brand from price competition

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Measuring World-Class Brands World-

Evaluating World-Class Brands

Quality

Salience

Equity

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Characteristics of a World-Class Brand World‡ Delivers benefits consumers want ‡ Stays relevant ‡ Price equals value ‡ Good positioning ‡ Consistency ‡ Fits into brand portfolio ‡ Brand helps build brand equity ‡ Brand¶s managers understand what the brand means to consumers ‡ Support over long run ‡ Monitoring of the sources of brand equity

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Interbrand¶s Top 20 Global Brands, 2007

Source: Interbrand Report, ³Best Global Brands 2007,´ http://www.interbrand.com/best_brands_2007.asp.

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Affecting Behavior and Achieving Marcom Accountability
‡ The Importance of Brand Awareness 
Creating brand awareness and boosting brand image

serve little positive effect unless individuals make purchases or engage in desired behaviors 

Marcom¶s objective is ultimately to affect sales

volume and revenue

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Measuring Marketing Investment Performance
‡ Return on Marketing Investment (ROMI) 
Measures the effect of marcom, or of its specific

elements such as advertising, in terms of whether it generates a reasonable revenue return on the marcom investment

‡ Why Measure Marcom Effectiveness? 
Demands for greater accountability on the marketing

function  To become better at marcom activities

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Measuring Marketing Investment Performance
‡ Difficulties in Measuring Marcom Effectiveness 
Choosing an appropriate metric  Gaining agreement on measures  Collecting accurate data for marcom assessment  Determining effects of specific marcom elements

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Difficulties in Measuring Marcom Effectiveness: Choosing a Metric

What to Measure?

Change in brand awareness

Improvement in attitudes toward the brand

Increased purchase intentions

Larger sales volume

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Difficulties in Measuring Marcom Effectiveness: Gaining Agreement
‡ Finance Departments¶ Measures of Success: 
Discounted cash

‡ Marketing Departments¶ Measures of Success: 
Measures of brand

flows  Net present values of investment decisions

awareness, image, and equity

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Difficulties in Measuring Marcom Effectiveness: Collecting Accurate Data and Calibrating Special Effects
‡ What exact sales figures should be used to calculate sales? ‡ How much relative effect does each program element have on sales volume compared to the effect of other elements?

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Measuring Marcom Effectiveness
‡ Marketing-Mix Modeling Marketing Employing econometric statistical techniques to

estimate the effects that elements of the marcom mix have in driving sales volume.
‡ Example:

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