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CHAPTER 2 Marketing Communications Challenges:

Enhancing Brand Equity, Influencing


Behavior, and Being Accountable

2010 South-Western, a part of Cengage Learning PowerPoint Presentation by Charlie Cook


All rights reserved. The University of West Alabama
Eighth Edition
Chapter Objectives
After reading this chapter you should be able to:
1. Explain the concept of brand equity from both the
companys and the customers perspectives.
2. Describe the positive outcomes that result from
enhancing brand equity.
3. Appreciate a model of brand equity from the
customers perspective.
4. Understand how marcom efforts must influence
behavior and achieve financial accountability..

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Introduction:
Framework for Marcom Process

Fundamental Implementation Desired


Decisions Decisions Outcomes

Evaluation and
Corrective Action

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Basic IMC Issues

Marketing
Communicators

How to
How to affect How to justify
How to enhance demonstrate
customer marcom
brand equity financial
behavior investments
accountability

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Basic IMC Issues
What can marketing communicators do to
enhance the equity of their brands?
How can marketing communicators affect the
behavior of their present and prospective
customers?
How can marketing communicators justify their
investments in advertising, sales promotions,
and other marcom elements?
How can marketing communications
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
the customer.
Is valuable when consumers believe the brand can
deliver on its promises.
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A Firm-Based Perspective on Brand Equity

Effects of Brand
Equity Increases

Higher Increased Premium Revenue


market share brand loyalty pricing premiums

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Table 2.1 Childrens Taste Preferences (In percents)

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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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Figure 2.1 A Customer-Based Brand Equity Framework

Source: Adapted from Kevin Lane Keller, Conceptualizing, Measuring, and Managing
Customer-Based Brand Equity, Journal of Marketing 57 (January 1993), 7.
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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
consumers 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.
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Figure 2.2 The Brand Awareness Pyramid

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

Brand image
associations that
build brand equity

Positive Perceived Favorable


Attributes Benefits 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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Figure 2.3 Leveraging Brand Meaning from Various Sources

Source: Kevin Lane Keller, Brand 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
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 brand
Maintain brand differentiation from competitive
offerings
Insulate brand from price competition

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Measuring World-Class Brands

Evaluating
World-Class Brands

Quality Salience Equity

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

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Table 2.2 Top Ten World-Class Brands Overall (Among 1,030 total
brands included in EquiTrends Spring 2006 survey)

Source: Spring 2006 EquiTrend brand study by Harris Interactive,


http://www.harrisinteractive.com/news/allnewsbydate.asp?NewsID=1063 (accessed July 26, 2007).
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Table 2.3 Interbrands Top 20 Global Brands, 2007

Source: Interbrand Report, Best 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
Marcoms 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?

Improvement
Change in Increased
in attitudes Larger sales
brand purchase
toward volume
awareness intentions
the brand

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Difficulties in Measuring Marcom
Effectiveness: Gaining Agreement
Finance Departments Marketing Departments
Measures of Success: Measures of Success:
Discounted cash flows Measures of brand
Net present values of awareness, image, and
investment decisions 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
Employing econometric statistical techniques to
estimate the effects that elements of the marcom mix
have in driving sales volume.
Example:

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