Foundations of branding Flashcards
Definitions of a Brand:
- “A brand is a living business asset, brought to life across all touchpoints, which if properly managed, creates identification, differentiation and value.”
- “A brand is a label, designating ownership by a firm, which we experience, evaluate, have feelings towards, and build associations with to perceive value.” (Brakus et al., 2009)
- “A brand is a repository of meanings for consumers to use in living their own lives.” (Fournier 1998; McCracken 1986)
Mercātus =
Market-place, merchant
Why is branding so important according to Ogilvy?
“There isn’t any significant difference between the various types of whiskey, or cigarettes or beer. They are all about the same. (…)
The manufacturer who dedicates his advertising to building the most sharply defined personality for his brand will get the largest share of the market at the highest profit.”
David Ogilvy, ‘The Father of Advertising’
Brands create (financial) value through…
Differenciation.
Positive customer-based brand equity: If consumers react more favorably to an element of the marketing mix for the brand, than they do for the same marketing mix element, when it is attributed to a fictiously named/ unnamed version of the product.
(Keller 1993)
Benefits of branding for consumers:
Functional and emotional domains of brands:
- All brands have a functional element - the “core benefit” that is being delivered
- Most brands, also try to create an emotional response
- Think about it as a continuum, from brands being highly functional to highly emotional
Are we what we own?
Brands carry meanings and are used by consumers to construct their identities.
“…that we are what we have is perhaps the most basic and powerful fact of consumer behavior…”(Possessions and the Extended Self, Russel W. Belk p. 139)
- If you look like an important person, people will treat you in that way
- Also we become what we buy
- We buy things because of what they mean
Brands exist primarily in…
The mind of the consumer!
- Brand management has a lot to do with managing perceptions
- Brands compete in a “battle for mindspace”
Homo Oeconomicus is:
“ (…) the rational agent depicted in economic models. When given options he chooses the alternative with the highest expected utility for himself ”
(Oxford Dictionary)
The consumer purchase decision process:
BUT:
- Does this apply to how you buy chewing gum and toilet paper?
- Did this apply to your last spontaneous purchase of shoes (which you bought because you simply “had to have them”)?
- We as consumers are really not at all that rational!
- This type of decision process only applies to a limited number of purchase situations
Involvement=
“The level of personal importance and/or interest evoked by a stimulus (e.g. product) within a specific situation”
(Zaichkowsky, 1985)
High Involvement:
High-Involvement-Purchases have a great importance for a consumer in a respective decision.
Reasons:
- High price,
- Risk,
- Great social importance,
- Lifestyle, …
Often particular effort and active information search when buying such products. Examples: a car, a house, an engagement ring…
Exception: Purchase of highly expressive or symbolic products, which are bought with little information search because psychosocial interpretation is difficult to deconstruct into searchable attributes (think Harley Davidson…)
Low Involvement:
Low-involvement purchases are of relatively little importance for the consumer.
Reasons:
- Low price,
- Little risk attached,
- No personal interest,
- No connection to lifestyle or personal signals, …
Little effort and information search when buying such products.
Examples: flour, tissues…
How do you decide to buy a certain brand in low-involvement situations, if not through extensive information search?
Brands and low involvement
- Brands become a mental shortcut, which allows easy decisionmaking
- Consumers look for functionality in combination with some degree of emotion/ liking
The level of involvement that consumers have for purchasing your product have major implications for your brand management and communication efforts!
Water Experiment - Did You Know?
- 18 billion plastic water bottles are consumed per year (just in the UK), around 35% get recycled
- Bottled water is at least 500 times more expensive than tap
- Decanter wine magazine organised a blind water tasting in 2007. 24 different types of water tested by sommeliers. Results:
- # 1 Waiwera, New Zealand
- # 2 Vittel, France
- # 3 Thames Tap Water, London
- (#15 Evian; #20 Volvic; #22 Bling)
How can we get people to drink tap water?
=> Create a brand around it that conveys meaning!
