Brand Management 260 Ch 2

The Concept of Customer-Based Brand Equity Customer-based brand equity is defined as the Differential effect that brand knowledge has on consumer response to the marketing of the brand. KEY terms Differential effect Brand knowledge Consumer response to marketing 12

Positive CBBE More accepting of a new brand extension Less sensitive to price changes and withdrawal of advertising support More willing to seek out the brand in a new distribution channel

Customer-Based Brand Equity as a “Bridge” Customer-based brand equity represents the “added value” endowed to a product as a result of past investments in the marketing of a brand. Customer-based brand equity provides direction and focus to future marketing activities 7 7

Making a brand strong…Brand Knowledge Brand knowledge creates Brand equity because it creates differential effect that drives brand equity. Associative Network Memory Model Nodes and linkages create brand image and brand awareness 19

Determinants of Customer-Based Brand Equity Customer is aware of and familiar with the brand Customer holds some strong, favorable, and unique brand associations in memory Body Shop MTV Marlboro Head and Shoulders 14

Making a brand strong…Brand Knowledge Brand knowledge structures depend on . . . The initial choices for the brand elements The supporting marketing program and the manner by which the brand is integrated into it Other associations indirectly transferred to the brand by linking it to some other entities 19

Brand Elements A visual or verbal information that serves to identify and differentiate a product Brand name Logo Symbols Character Packaging Slogan Jingle Ask what consumers would think about the brand if they only know its brand name and associated logo

Disneyland as a Brand “Associations” Fun Family Happiness Mickey Mouse Dream Holiday Fantasy Magical Journey A brand is a “network of associations” It resides in customer’s mind but not in the company

Benefits of Customer-Based Brand Equity Enjoy greater brand loyalty, usage, and affinity Command larger price premiums Receive greater trade cooperation & support Increase marketing communication effectiveness Yield licensing opportunities Support brand extensions. 15

Motivation for Customer-Based Brand Equity Model Marketers know strong brands are important but aren’t always sure how to build one. CBBE model was designed to be … comprehensive cohesive well-grounded up-to-date actionable

Building Customer-Based Brand Equity Building a strong brand involves a series of steps as part of a “branding ladder” A strong brand is also characterized by a logically constructed set of brand “building blocks.” Identifies areas of strength and weakness Provides guidance to marketing activities

4 steps of brand building Ensure identification of the brand with customers and an association of the brand in customers minds with a specific product class or customer need. Firmly establish the totality of brand meaning in the minds of customers by strategically linking a host of tangible and intangible brand associations with certain properties Elicit the proper customer responses to this brand identification and brand meaning Convert brand response to create an intense active loyalty relationship between customers and the brand.

CUSTOMER-BASED BRAND EQUITY PYRAMID RESONANCE SALIENCE JUDGMENTS FEELINGS PERFORMANCE IMAGERY 4. RELATIONSHIPS = What about you & me? 3. RESPONSE = What about you? 2. MEANING = What are you? 1. IDENTITY = Who are you?

Salience Dimensions Depth of brand awareness Ease of recognition & recall Strength & clarity of category membership Breadth of brand awareness Purchase consideration Consumption consideration

Performance Dimensions Primary characteristics & supplementary features Product reliability, durability, and serviceability Service effectiveness, efficiency, and empathy Style and design Price 23

Imagery Dimensions User profiles Purchase & usage situations Demographic & psychographic characteristics Actual or aspirational Group perceptions -- popularity Purchase & usage situations Type of channel, specific stores, ease of purchase Time (day, week, month, year, etc.), location, and context of usage Personality & values Sincerity, excitement, competence, sophistication, & ruggedness History, heritage, & experiences Nostalgia Memories

Judgment Dimensions Brand quality Brand credibility Value Satisfaction Brand credibility Expertise Trustworthiness Likability Brand consideration Relevance Brand superiority Differentiation

Feelings Dimensions Warmth Fun Excitement Security Social approval Self-respect

Resonance Dimensions Behavioral loyalty Attitudinal attachment Frequency and amount of repeat purchases Attitudinal attachment Love brand (favorite possessions; “a little pleasure”) Proud of brand Sense of community (e.g Apple, Harley Davidson) Kinship Affiliation Active engagement Seek information Join club Visit web site, chat rooms

Customer-Based Brand Equity Model Consumer- Brand Resonance Brand Salience Consumer Judgments Consumer Feelings Performance Imagery INTENSE, ACTIVE LOYALTY RATIONAL & EMOTIONAL REACTIONS POINTS-OF-PARITY & POINTS-OF-DIFFERENCE DEEP, BROAD BRAND AWARENESS

Sub-Dimensions of CBBE Pyramid LOYALTY ATTACHMENT COMMUNITY ENGAGEMENT QUALITY CREDIBILITY CONSIDERATION SUPERIORITY WARMTH FUN EXCITEMENT SECURITY SOCIAL APPROVAL SELF-RESPECT CATEGORY IDENTIFICATION NEEDS SATISFIED PRIMARY CHARACTERISTICS & SECONDARY FEATURES PRODUCT RELIABILITY, DURABILITY & SERVICEABILITY SERVICE EFFECTIVENESS, EFFICIENCY, & EMPATHY STYLE AND DESIGN PRICE USER PROFILES PURCHASE & USAGE SITUATIONS PERSONALITY & VALUES HISTORY, HERITAGE, & EXPERIENCES