Marketing Management Dawn Iacobucci © 2010 South-Western, a part of Cengage Learning

Brands Chapter 6

Brands Marketers believe that brands have value, above and beyond the benefits of the product itself Brand portfolio of qualities associated with a name More than just a name

Brands Qualities associated with the brand Some qualities are under marketer control Product shape Product packaging Logos, shapes & symbols Colors Jingles & slogans Spokespeople Some are not Personal memories about brands

Brand Name A brand is first and foremost a name Some names immediately convey information Geek Squad Some names suggest their benefits Motorola's Razr phone Some names are those of their founder Trump Tower Try to choose brand names that convey information about the benefits of brand

Customer Benefits of Branding For the customer Brands convey information Sony is quality. Anything from Sony is quality Brands signal consistent quality Brands allow for predictability regarding quality Brands confer status Some brands bolster consumer’s self-image Brands reduce the risk of purchase Brands make purchase decisions easier Customers know what they are getting

Company Benefits of Branding For the company Brands enhance loyalty If brand satisfies, brand image is solidified Brands allow charging premium prices Brands assist in STP Multiple brands allow firms to target multiple segments Brands inoculate the company from some competitive action Brands encourage channel partners’ support

Brand Associations Product attributes Product benefits Color, size, shape, flavor, etc. Product benefits More intangible than product attributes This sweater is flattering

Brand Associations Emotional benefits More intangible than product benefits A flattering sweater is a means to achieving the goal of being attractive Benefits are more meaningful and easier to claim as an advantage BUT…harder to create

Brand Associations Brands can serve social functions Brands can be expressions of the customer’s ideal self Teenagers with the “right” shoes Brands can become the focal point of bonding Harley Davidson Riders

Brand Personalities Brand personalities can capture something specific or holistic about the brand position in the marketplace MTV is not just a music cable station—it’s a way of life for young, cool people Brand personality profiles are not better than others…they are just different

Brand Communities Some customers are so passionate about their love for certain brands that they like to connect with other like-minded customers HOGS riding groups, Harry Potter blogs, etc. Marketers can encourage and build upon these communities

Branding Strategies Umbrella Brands Company attaches same brand name to all of its products Subsequent product introductions are easier for the customer to understand and accept Higher initial awareness levels Stronger financial outcomes for company Honda

Branding Strategies House of brands Company introduces a new brand name for every major line of product it brings to the marketplace Problems of one brand shouldn’t negatively affect other brands Companies can reach multiple segments P&G

Brand Extensions Brand extensions Marketer leverages the brand’s good name to get customers to buy something new Line extensions: apply to a product within a product line Category extensions: apply to a product in a different product line

Co-branding Co-branding Ingredient branding Two companies collaborate in a joint venture to create a good or service for the customer Cole Haan shoes with Nike Air technology Ingredient branding One of the companies and its product is the primary host and the other company and its product add value to the host product American Airlines serving Starbucks coffee

Co-branding Co-branding works well when a company is introducing a new product attribute Adding cough medicine to candy Self-branding (Branding one of their own ingredients to differentiate its quality from competitors) works better when tweaking a minor attribute Tide’s “EverFresh” scent

Global Brands Global brands Options At least 30% of the brand’s revenues come from other countries Options Glocalization: manufacture globally, brand locally Use the same name globally Greater advantages to maintaining single brand worldwide

Store Brands Private label brands Less expensive and more of a “me-too” product offering Target’s “Archer Farms,” Kroger’s “Private Selection,” and Costco’s “Kirkland Signature” The retailer can offer decent quality for lower prices due to reduced advertising costs

Brand Equity Brand Equity Measurement Approaches The worth of a brand Determining the price premium of brand “How much are you willing to pay for gas at Shell?” vs. “How much are you willing to pay at a local station?” Comparing branded and unbranded “How much do you like this $799 Sony flat screen with screen-within-a-screen?” vs. “How much do you like this $799 unknown brand flat screen sharing the same features?”

Brand Equity Measurement Approaches, cont. Interbrand: assess the value of a firm, subtract its physical and financial assets Brand contribution index varies by product category: high for cologne, lower for retailers