chapter 12 Branding McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved.

Branding — Today’s Objectives Objectives will be to: Understand what a brand is and how the 2Is affect branding Understand what brand equity is and how it is measured Discuss how marketing programs build brand equity Examine the seven-step branding process Review two case studies in online branding Discuss the effects of brand on the four customer relationship stages

Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion Chapter 12: Branding

Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion

Some Internet Brands Have Become Major Players Source:

Exhibit 12.1: Examples of Internet Brands

Exhibit 12.2: Case Studies of Successful Online Branding Efforts Established as Traditional Brand Established as Online Brand Source: PricewaterhouseCoopers Moneytree Report 2000.

Individualization Interactivity Community Interactivity creates value because the brand is tailored to the individual Customers gain a sense of control with respect to the nature and timing of their interactions with the brand There is a danger that the brand will stray from its core personality Responsiveness becomes a key brand attribute as customers recognize that their concerns are heard and responded to across multiple channels The frequency of interaction is increased — leading to the need to freshen content and target messages to specific usage occasions Customers expect the brand to evolve in response to their needs and desires Exhibit 12.3: The 2Is and Branding

Should Offline Firms Create New Online Brands? Point-Counterpoint

Chapter 12: Branding Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion

Quotes on Online Branding “E-branding is more important [than e-commerce]. And it must come first. Because few people will buy your stuff – online or off – unless you are top-of-mind.” – Annette Hamilton, Executive Producer, ZDNet “Brand is the price of entry [to the Internet], not the winning strategy.” – Dylan Tweney, infoNet “By the time your potential customers log on, they already know what they’re looking for, and they often know from whom they want to buy it. … They’re just not listening to branding messages anymore.” – Michael Fischler, Principal, The Pubs Group

Quotes on Online Branding (cont.) “Brands stand as comfort anchors in the sea of confusion, fear, and doubt. In dynamic markets, strong brands have more value than ever, precisely because of the speed with which these markets move.” – Chuck Pettis, Technobranding “It took more than 50 years for Coca-Cola to become a worldwide market leader, but only five years for online search engine Yahoo to gain market dominance. The role of the brand has changed dramatically and has created a vacuum between offline and online brands.” – Mark Lindstrom, Executive Director, ZIVO “A company’s website is the brand. It’s the hub of consumer experience, the place where all aspects of a company, from its annual report to its products to its support, intersect. It’s the company in a nutshell, all there in a way that just is not possible in the analog world.” – Sean Carton, Carton Donofrio Interactive

Product, Price, Community, Communication and Distribution Programs Wraparounds Exhibit 12.4: A Simple Conceptual Model of Brand Equity Core Product/ Service Source: Keller (1996), Aaker (1996), Strategic Market Research Group, Marketspace Analysis... provides positive consumer responses... A good brand... Customer Benefits Confidence Loyalty Satisfaction Customer Benefits Confidence Loyalty Satisfaction Firm Benefits Reduced marketing costs Increased margins Opportunity for brand extensions Firm Benefits Reduced marketing costs Increased margins Opportunity for brand extensions... and benefits both target customers and firm Brand Awareness Depth Breadth Brand Awareness Depth Breadth Brand Associations Strength –Relevant –Consistent Valence Uniqueness –Memorable –Distinctive Brand Associations Strength –Relevant –Consistent Valence Uniqueness –Memorable –Distinctive

Fogdog Brand Perceptions Emphasize prices and selection benefits Selective distribution Competitive pricing Exhibit 12.5: A Model of FogDog Branding Gift shopping service MyFogdog discounts and benefits “How to buy” help Discussion groups by sport Fogdog Fetch helps you find the right product Low prices Selection breadth and depth Product, Price, Community, Communication and Distribution Programs Wraparounds Core Product / Service

Do Strong Online Brands Matter? Point-Counterpoint

Chapter 12: Branding Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion

Exhibit 12.7: Marketing Programs to Build Brand Equity Brand Equity Product Pricing Communication Promotional Program Promotional Program Distribution

Chapter 12: Branding Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion

Clearly Define the Target Audience Exhibit 12.8: A Seven-Step Branding Process Step 1 Step 3 Step 2 Step 4 Step 5 Step 6 Step 7 Understand the Target Customer Understand the Competition Design Compelling Brand Intent Identify Key Leverage Points in Customer Experience Execute the Branding Strategy Establish Feedback Systems

Exhibit 12.9: Similarities & Differences in Offline vs. Online Branding

Chapter 12: Branding Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion

Exhibit 12.10: Citibank Online

Exhibit 12.11: Citibank Vs. Chase: Assessment of Key Branding Elements

Exhibit 12.12: Citibank Vs. Chase Assessment of Key Brand Attributes

Exhibit 12.13: CBS MarketWatch.com

Exhibit 12.14: CBS Marketwatch.com Vs. Bloomberg.com: Key Branding Elements

Exhibit 12.15: CBS Marketwatch.com Vs. Bloomberg.com: Key Brand Attributes

Exhibit 12.16: Brand as a Moderating Variable Marketing Levers Relationship Stages For advertising, brand can enhance awareness Brand Enhances or Detracts

Chapter 12: Branding Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion

Branding and Four Key Stages of Customer Relationships Offline advertising Web price discount Increased number of channel intermediaries Online billboards Direct mail Targeted price promotions Efficient site structure Volume discounts Personalized pages Loyalty programs Discontinue pricing discounts Reduce advertising expenditures Identify “departing friends” Reduce customer care Awareness Exploration/ Expansion Exploration/ Expansion Commitment Dissolution

Chapter 12: Branding Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion

Exhibit 12.17: EBay Vs. Amazon.com Auctions: Key Branding Elements

Exhibit 12.18: EBay and Amazon.com Auctions: Key Attributes

Chapter 12: Branding Defining Brand and Examining How the 2Is Affect Branding What Is Brand Equity, and How Is It Measured? How Marketing Programs Build Brand Equity The Seven-Step Branding Process Two Case Studies in Online Branding Effects of Brand on the Four Customer Relationship Stages EBay Example Conclusion

Branding — Conclusion Branding is fundamentally different from the other marketing activities — product, pricing, communication, community and distribution — in three ways: Brands are reflections or outcomes of the firm’s marketing activities Unlike the other activities, branding is an integral part of every marketing activity and strategy Strong brands can be used to enhance the effectiveness of all other marketing activities The branding process includes seven steps: 1) clearly define the target audience, 2) understand the target customer, 3) understand the competition, 4) design compelling BrandIntent, 5) identify key leverage points in customer experience, 6) execute the branding strategy and 7) establish feedback systems. The presence of a strong brand enhances positive marketing activities such that awareness, exploration and commitment are more effectively established.