Chapter 13 - Branding Decisions Flashcards
What is a brand and what types of attributes are they constructed by?
Brands are products that have added value and are meaningful for the customers; they exists in the mind of the customers, and consider their perceptions of the product.
- Intrinsic attributes. Functional characteristics of a proposition, such as shape, performance and physical capacity. If changed, it directly alters the proposition.
- Extrinsic attributes. Elements that, if changed, do not alter the material functioning and performance of the proposition itself. It can be brand name, marketing communications, packaging, price and mechanisms that enable consumers to form meaningful associations to the brand. Help distinguish between brands.
What are the three BPs?
Brand promise, brand performance, brand positioning.
Why do consumers like brands?
- Help to identify preferred offerings
- Reduce levels of perceived risk and thus improves quality of shopping experience. (financial, social, functional risks)
- Help people gauge the quality of the product/service/experience
- Reduce time spent making proposition-based decisions, and also time spent shopping around
- Informs about the source of an offering (country/company)
Why do manufacturers and retailers like brands?
- Can increase the financial valuation of companies
- Enable premium pricing
- Help to differentiate one proposition from competitive offerings
- Can deter competitors from entering the market
- Encourage cross-selling to other brands owned by the manufacturer
- Help to develop customer trust, loyalty and repeat-purchase buyer behavior
- Help in the development and use of integrated marketing communications
- Contribute to corporate identity programs
- Provide some legal protection
What are brand associations and brand personalities?
To develop successful brands, customers must be able to make appropriate brand-related associations. Main dimensions are brand image, perceived quality and brand attitude. Brand personalities are attributes that align with attitudes. Marketing communications is important to communicate the essence of a brand’s personality. Brands offer self-expression; consumers can align with who they are or who they want to be. Brand personality is difficult to copy, and is a way of creating/maintaining customer loyalty.
What are the five dimensions of brand personality?
- Sincerity (down-to-earth, honest, wholesome, cheerful)
- Excitement (Daring, spirited, imaginative, up to date)
- Competence (reliable, intelligent, successful)
- Sophistication (upper class, charming)
- Ruggedness (outdoors, tough)
What is important when choosing a brand name?
- easily recalled, spelled and spoken (across all markets). Short names such as LEGO have this strength.
- strategically consistent with the organization’s branding policies
- indicative of the offering’s major benefits/characteristics
- distinctive (differ from others)
- meaningful to the customer
- capable of registration and protection
Social pressure or crisis can sometimes stimulate a change of name. A name change can trigger a change in values, culture and approach. Brands are increasingly being developed through the use of social media, where people talk to each other about their brand experiences.
What are the three main types of brands?
- Manufacturer brands
- Distributor (private label) brands
- Generic brands
What is a manufacturer brand?
Manufacturers try to create brand recognition and name recall with their marketing communications activities with end users, since retailers can influence how their product is displayed and presented. The goal is to help customers identify the producer of a particular brand at the point of purchase. When customers are shopping, they use their images of manufacturers and their own experience to seek out their preferred brands.
What is a distributor brand?
Distributor brands refer to the identities and images developed by wholesalers, distributors, dealers and retailers who make up the marketing channel. This potentially offers advantages to the manufacturer, which can use excess capacity to manufacture such brands, as well as retailers who can earn a higher margin and develop strong store images. Occasionally, conflict arises, especially when a distributor brand displays characteristics that are very similar to the manufacturer’s market-leader brand.
What is a generic brand?
Sold without any promotional materials or any way of identifying the company; the packaging displays only information required by law. The only form of identification is the relevant product category. These brands are sold at prices substantially lower than prices of normal brands since there is no cost for promotional support. Today, only firms in the pharmaceutical sector use this type of brand.
What are benefits of an overall branding strategy?
Can provide direction, consistency and brand integrity within an organization’s portfolio of brands.
What are the three core brand strategies?
- Individual branding
- Family branding
- Corporate branding
What is individual branding?
Each product offered is branded independently. Easy to target specific segments and to enter new markets with separate names. If a brand fails or gets negative media attention, the other brands are not likely to be damaged. However, there is a high financial cost since each brand needs a promotional program and associated support.
What is family branding?
All products use the organization’s name, either entirely or in part, in hope that customers develop trust across all brands. Lower promotional investments since there is an effect on all brands when one of them is communicated, and brand experience stimulates word of mouth. A derivative policy is line family branding, which is family branding for all products within a single line.
