1 BRAND Strategies Introduction to Marketing Management CSUN

2 What is a BRAND? "A brand is a name, symbol, design, or mark that enhances the value of a product beyond its functional purpose" (Farquhar 1989). "For many businesses the brand name and what it represents are its most important asset--the basis of competitive advantage and of future earnings streams” (Aaker 1991). Coca-Cola was estimated to be worth $36 billion Budweiser worth $9.7 billion Nike's worth was estimated at $3.6 billion Barbie's value was judged to be $1.7 billion.

3 Branding Definitions Brand: any name, term, symbol, sign, design, or unifying combination of these that identifies one product from another competitive product Brand Name: the verbal part of the brand Logo: a brand name or company name written in a distinctive way (short for “logotype”) Trademark: a legally protected brand name or brand mark. A registered trademark gives a marketer proprietary rights to a symbol or name Service Mark: provides the same identifying function for services that a trademark provides for goods. It also can be legally protected by registration Generic Names: describe a product or an item that is part of our standard vocabulary Product Strategies

4 Advantages of Brand Names Brand Equity Advantages of Brand Names Brand Equity Strong Brand Association Strong Brand Association Attributes Quality & Value Consistency Identification Perceived Quality Name Awareness High Brand Loyalty High Brand Loyalty Purpose of Branding

5 BRAND AWARENESS BRAND ASSOCIATIONS BRAND QUALITY BRAND LOYALTY Anchor to Which Other Associations Can Be Attached Familiarity Liking Signal of Commitment Brand to Be Considered Help Process & Retrieve Information Differentiate/ Position Reason-to-Buy Create Positive Attitudes/ Feelings Potential for Extensions Reason-to-Buy Differentiation/ Position Price Channel Member Interest Extensions Reduced Marketing Costs Trade leverage Attracting New Customers (create Awareness & Reassurance) Time to Respond to Competitive Threats Managing and Building a Brand Knowledge Recall versus Recognition Perceived Meanings Brand can possess an appealing image that consumers value directly Expected Performance Price Sensitivity & Purchase rate

6 Brand Awareness Recall –e.g., first brand that comes to mind in x category Recognition –e.g., Rate your level of familiarity of each brand in x category

7 Brand Associations: e.g., Bose Brand Attributes (e.g., electronic expertise Brand Personality (e.g., lifestyle, elegance) Functional Benefits Symbolic Benefits Emotional Benefits Brand Identity

How to Create Strong Brands Marketing Programs ProductDistribution PriceCommunica. Brand Loyalty Brand Awareness Brand Associations Perceived Quality Other Proprietary Assets Loyalty: Resistance to competition Larger margins More elastic for price decreases Less elastic for price increases Communications efficiency/effective Licensing opps. Brand extensions Brand Elements NameSymbol LogoCharacter Pkg.Slogan Secondary Associations CompanyEndorser Company of origin Events Brand Equity

9 Five-Stage Consumer Buyer Decision Process Problemrecognition Informationsearch Evaluation of alternatives Purchasedecision Postpurchasebehavior Buyer behavior

10 ITEMS NEED RECOGNITION INFORMATION SEARCH EVALUATION OF ALTERNATIVES EQUITYEQUITY Brand Attitude learn from competitive brands Form Consideration set Develop Brand beliefs for each brand/attribute (brand positioning) Brand beliefs make up the Brand Image Brand beliefs varies with experience and the effect of selective perception, distortion, and retention STRATEGYSTRATEGY Keep the brand newsworthy Build Familiarity Brand name conveying a product benefit = higher recall (e.g., Lean Cuisine – low calorie food). Develop a plan to get into prospect ’ s consideration set Identify competitors in the consumer ’ s choice set - to plan its competitive appeals Alter beliefs about the brand (psychological repositioning) Alter beliefs about the competitors ’ brands: competitive depositioning (e.g., running a comparison ad) Alter the importance weights Call attention to neglected attributes Shift the buyer ’ s ideals Brand Awareness advertising exposure (1) recognise the brand (2) recall the brand with cues (3) place the brand in a consideration set

11 ITEMSPURCHASE DECISION POST-PURCHASE BEHAVIOR EQUITYEQUITY Based on Brand Preference Brand preference varies with: (1) attitudes of others (2) motivation to comply with other person ’ s desires Brand Loyalty Enhanced brand loyalty to: buy time to respond when competitors innovate reduce cognitive dissonance STRATEGYSTRATEGY Increase perceived Brand Quality and Associations Generate platforms to build on brand reputation Reduce perceived risk (warranty, professional referrals, etc.) Make product claims that faithfully represent the product ’ s likely performance (satisfaction) Generate brand heritage: connections between products and consumers become part of the social and cultural fabric (e.g., Santa Claus and Coca-Cola, De Beers & diamonds and marriage, champagne and celebrations)

12 Implications of Brand Equity Provides Value to Customers by Enhancing Customer’s: Interpretation/Processing of Information Confidence in the Purchase Decision Use Satisfaction Provides Value to Firms by Enhancing: Efficiency and Effectiveness of Marketing Programs Repeat Purchase Prices/Margins Trade Leverage Competitive Advantage Product and Market Extensions Bargaining Power New Product Launch

13 Brand Strategy Line Extensions Brand Extensions Multibrands New Brands Brand Strategy Line Extensions Brand Extensions Multibrands New Brands Brand Sponsor Manufacturer’s Brand Private Brand Licensed Brand Co-branding Brand Sponsor Manufacturer’s Brand Private Brand Licensed Brand Co-branding Brand Name Selection Selection Protection Brand Name Selection Selection Protection Major Branding Decisions A five-step process: (1) setting branding objectives (2) creating a list of candidate brand names (3) evaluating prospective brand names (4) choosing the best brand names (5) applying for registration

14 Types of Brands Manufacturer’s Brands Distributor’s or Private Brands Generic Products Name is owned and advertised by the manufacturer Black & Decker tools Whirpool Appliances Name is owned and advertised by intermediary Craftsman Tools VONS products “No-Name” product in plain package with stark lettering “No-Name” product in plain package with stark lettering Dog Food Product Strategies

15 Strategic Choices of Brand Name Three brand name choices : A.B. C. family brandingindividual brandingcombinations VW Beetle - less expensive- more expensive VW Beetle - less effective- can be very effective PhilipsOMO POWER - Philips- OMO POWER

16 How Do You Build a Brand* Knowledge Intimate understanding of the brand and what it stands for Esteem Regard for the brand Relevance Personal appropriateness of the brand Differentiation Perceived uniqueness of the brand *Young & Rubicam Brand Asset Valuator TM Model

17 Differentiation Insufficient Differentiation yields brand’s margin opportunity Relevance yields usage opportunity (penetration) The differentiation must be relevant to create a strong brand Brand Strength DifferentiationRelevance

18 Esteem & Knowledge = Brand Stature Esteem –Related to perceptions of “high quality” and “increasing popularity” Knowledge –The successful outcome or culmination of brand building –Achieved/earned, not bought Brand Stature EsteemKnowledge

19 Dimensions of Brand Personality The set of human characteristics associated with a brand. It enables a customer to express his or her own self, or ideal self, on specific dimensions of the self through the use of the brand SincerityExcitementCompetenceSophisticationRuggedness Down-to earth HonestWholesomeCheerfulDaringSpiritedImaginativeUp-to-dateReliableIntelligentSuccessful Upper class Charming Outdoorsy Tough

20 Line Extension Dannon Yogurt Flavors Multibrands Seiko  Pulsar Brand Extension Barbie Electronics New Brands Toyota & Lexus Brand Name ExistingNew Product Category Existing New Four Brand Strategies + Co-Branding = brands bearing 2 or more brand names BMW + Michelin or Intel + Compaq