CH10: Building Strong Brands Flashcards
brand
name, term, sign, symbol, design, or combination, intended to identify the goods or services of one seller or group of sellers and differentiate them from those of competitors
ultimate purpose of the brand
create value for consumers, company, and collaborators that goes beyond the value created by the product and service aspects of the offering
branding
the process of endowing products and services with the power of a brand
brands’ main roles for consumers
- set and fulfill expectations
- reduce risk
- simplify decision making
- take on personal meaning
- become part of identity
brands’ main roles for firms
- simplify product handling
- organize inventory and accounting
- offer legal protection
- create brand loyalty
- secure competitive advantage
brand equity
monetary value of a brand; net present value of all expected future returns generated by the brand; part of “goodwill”
goodwill
monetary value of all intangible assets of a company, e.g. brands, patents, copyrights, know-how, licenses, etc.
the 3 methods of measuring brand equity
- cost approach
- market approach
- financial approach
cost approach to brand equity
calculates brand equity based on historical costs associated with the brand; costs of brand development
market approach to brand equity
estimates brand equity by measuring the difference in revenues of a branded vs unbranded offering, adjusted for brand-related expenses; e.g. Morton Salt vs generic salt
financial approach to brand equity
evaluates brand equity as NPV of a brand’s future earnings; steps include: compute future cash flow, estimate brand contribution to future cash flow, adjust the cash flow based on brand-related risk factors to future earnings
brand power
ancillary value contributed by the brand to a product or service; the degree to which the brand influences the way consumers interact with the brand; can be positive or negative
what is brand power based on?
- consumer brand knowledge
- brand associations
what happens in the case of neutral brand power? [was part of a question in chapter test]
the brand-name product is essentially a commodity, and competition will be based on price
brand audit
assessment of brand health, used to uncover sources of brand equity and suggest ways to improve/leverage brand equity
brand tracking
tracking results from brand audits over time, and making adjustments as needed
brand mantra
short and vivid articulation of the heart and soul of the brand used internally to guide org and employee actions
characteristics of a good brand mantra
- communicate brand’s uniqueness
- simplify brand essence
- inspire
characteristics of brand elements
brand-building:
- memorable
- meaningful
- likable
defensive:
- transferable
- adaptable
- protectable
brand characters
special type of brand symbol with human characteristics, used to enhance likability and show that the brand is interesting and fun (e.g. Tony the Tiger, Mr. Peanut)
brand personality
specific mix of human traits that we can attribute to a particular brand; consumers gravitate towards brands that are like them
secondary sources of brand knowledge
- places (e.g. Kenyan coffee)
- things (e.g. related charity/foundation)
- people (e.g. celebrities)
- other brands (e.g. co-branding)
brand hierarchy
the way in which a company’s brands are related to a company’s products and services, as well as to one another; e.g. GM > Chevrolet > Corvette
brand portfolio
set of all brands and brand lines a particular firm offers for sale in a particular category or market segment; e.g. Coke has Coca Cola, Sprite, etc.
the 3 main brand portfolio strategies
- house-of-brands strategy
- branded-house strategy
- sub-brand strategy
house of brands portfolio strategy
individual or separate family brand names; e.g. P&G
branded house portfolio strategy
corporate umbrella or company brand name; e.g. GE
sub-brands portfolio strategy
combines two or more corporate, family, or individual product brand names; e.g. Kellogg’s
flagship product
product that best represents or embodies the brand to consumers
branded variant
specific brand lines supplied to specific retailers or distribution channels; e.g. Levi’s sells different jeans at Target than at its own retail locations
co-branding
two or more brands marketing together; same company, joint venture, or ingredient
benefits of co-branding
- leverage multiple brands
- attract new customers
- reduce go-to-market cost
- valuable means to learn about consumers
drawbacks of co-branding
- less control over brand associations
- abnormally high consumer expectations
- potential overexposure
brand value stages
- marketing program investment
- customer mind-set
- brand performance
- shareholder value
brand value chain multipliers
- program multiplier feeds from program investment to customer mind-set
- customer multiplier feeds from customer mind-set to brand performance
- market multiplier feeds from brand performance to shareholder value
brand repositioning strategies
- back to basics
- reinvention
benefits of brand extension
- consumer carry brand expectations to new extension
- easier to convince retailers to stock new items
- reduce launch costs
drawbacks of brand extension
- brand dilution
- forgo chance to create new brand with separate identity
- potential cannibalizing effects
brand dilution
consumers no longer associate a brand with a specific or similar set of products and start thinking less of the brand as a result
guidelines for managing a brand crisis
- empathy
- value
- strategy (including authenticity)
- innovation
the 2 defining characteristics of luxury goods
- quality
- uniqueness
the key principles of luxury brand management
- all marketing decisions must be aligned to ensure a consistent image
- create a premium, aspirational image
- span categories, and thus have a broadly-defined competitor range
- protect identity and aggressively combat trademark infringement and counterfeits
- all brand attributes must be aligned with the image of the brand, including secondary associations
