1. Marketing II / Session 3 04.04.2016 Martin Samek martin.samek@lbs.ac.at

2. Lauder Business School Brand 2 Marketing II/ Session 3

3. Lauder Business School Branding Strategies 3 Marketing II / Session 3 Co-branding Breitling & Bentley Adidas & Goretex

4. Lauder Business School Branding Strategies 4 Marketing II / Session 3 Luxury Brands: What is luxury? A definition “The state of great comfort and extravagant living: he lived a life of luxury” “An inessential, desirable item that is expensive or difficult to obtain: luxuries like raspberry vinegar and state-of-the-art CD players he considers bananas a luxury” (Oxford Dictionaries, 2015) “Luxury brands are regarded as images in the minds of consumers that comprise associations about a high level of price, quality, aesthetics, rarity, extraordinariness and a high degree of non-functional associations.” (Heine, K., 2012)

5. Lauder Business School Store Brands or Generic Brands 5 Marketing II / Session 3 Less expensive “me-too” product offering under a retailer’s own store or generic brand. Advantages for the customer:  Brands convey information  Lower prices compared to branded products  Brands signal consistent quality  Brands reduce customer risk  Brands make purchasing decisions easier Advantages for the company:  Less entities in the value chain  Reduced expenses in R&D, package design, promotion  Ability to compete with discounter chains  …

6. Lauder Business School Licensing 6 Marketing II / Session 3 Licensing is the process of leasing a legally protected (that is, trademarked or copyrighted) entity – a name, likeness, logo, trademark, graphic design, slogan, signature, character, or a combination of several of these elements.

7. Lauder Business School Product (Life Cycle) 7 Marketing II/ Session 3

8. Lauder Business School 8 New Product = Innovation? Marketing II / Session 3

9. Lauder Business School 9 New Product = Innovation? Marketing II / Session 3

10. Lauder Business School New Product = Innovation? 10 Marketing II / Session 3  Innovation “a new idea, device, or method” (Merriam Webster, 2016) “Product Innovation:A good or service that is new or significantly improved. This includes significant improvements in technical specifications, components and materials, software in the product, user friendliness or other functional characteristics. Marketing Innovation: A new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing.” (OECD, 2005)

11. Lauder Business School New Products 11 Marketing II / Session 3  Innovation -New to the world products/services. -New to the market products/services. -Successful in the market.

12. Lauder Business School Innovation from the customer ´s point of view 12 Marketing II / Session 3 -> Status of the customer -> Advances in technology -> Ease of use -> …

13. Lauder Business School Innovation and its importance for a company 13 Marketing II / Session 3 -> Competitive advantage -> Creates demand -> Builds an image -> Culture of Innovation -> R&D -> Cost -> High Financial Risk -> Technological risk -> Market risk

14. Lauder Business School New Products 14 Marketing II / Session 3  Innovation - Diffusion of Innovation How innovations/new products are adopted on the marketplace Identify an innovation in an industry of your interest!

15. Lauder Business School New Products 15 Marketing II / Session 3  Innovation - Diffusion of Innovation

16. Lauder Business School New Products 16 Marketing II / Session 3  Strategic Decisions

17. Lauder Business School Current Products 17 Marketing II / Session 3 Market penetration Sell more of same products to current markets. New ways to use the products, better pricing, better reward program, etc. Market development Sell existing products to new markets. Move internationally, appeal to younger segment, etc. May need to modify image, expand channels, etc.

18. Lauder Business School New Products 18 Marketing II / Session 3 Product development Sell new or modified products to current markets. Brand and line extensions or new variations of existing products. Diversification Pursue new markets with new products. More difficult!

19. Lauder Business School Product Life Cycle (PLC) 19 Marketing II / Session 3