Module 1 Flashcards
a brand (defined by the American Marketing Association)
a “name, term, sign, symbol, or design, or a combination of them, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competition.”
Many practicing managers refer to a brand as
something that has actually created a certain amount of awareness, reputation, prominence, and so on in the marketplace.
This would be a “Brand” rather than a “brand”.
The difference between AMA’s ‘brand’ and practicing managers’ ‘Brand’ can often lead to
disagreements about branding principles or guidelines which often revolve around what we mean by the term.
brand elements
Different components of a brand such as a name, logo, symbol, package design, or other characteristics that identify and differentiate it
the word brand is derived from norse word brander
meaning to burn - mark their lvestock to identify
A product can be…
a physical good a service a retail outlet a person an organization a place an idea
Five levels of meaning for a product
core benefit level generic product level expected product level augmented product level potential product level
core benefit level
the fundamental need or Want that consumers satisfy by consuming the
product or service.
generic product level
a basic version of the product containing only those attributes or characteristics absolutely necessary for its functioning but with no distinguishing features.
expected product level
a set of attributes or characteristics that buyers normally expect and agree to when they purchase a product.
augmented product level
includes additional product attributes, benefits, or related services that distinguish the product from competitors.
potential product level
includes all the augmentations and transformations that a product might ultimately undergo in the future.
A brand is more than a product, as it can have…
…dimensions that differentiate it in some way from other products designed to satisfy the same need.
Some brands create competitive advantages with…
…product performance.
For example, companies in the right figure have been leaders in their product categories for decades due, in part, to continual innovation.
Other brands create competitive advantages through…
…non-product-related means.
Coca-Cola, Chanel No.5 and others have been leaders in their product categories by understanding consumers motivations and desires and creating relevant and appealing images surrounding their products.
THE WORLD’S 25 MOST INNOVATIVE COMPANIES
1 Apple 2 Google 3 Toyota Motor 4 General Electric 5 Microsoft 6 Proctor & Gamble 7 3M 8 Walt Disney 9 IBM 10 Sony 11 Wal-Mart Stores 12 Honda Motor 13 Nokia 14 Starbucks 15 Target 16 BMW 17 Samsung Electronics 18 Virgin Group 19 Intel 20 Amazon 21 Boeing 22 Dell 23 Genentech 24 eBay 25 Cisco Systems
By creating perceived differences among products through branding and by developing a loyal consumer franchise, marketers create…
…value that can translate to financial profits for the firm.
Who said:
My father, John Stuart, has famously said, “If this company were to split up I would give you the property, plant and equipment and I would take the brands and the trademarks… and I would fare better than you.”
John Stuart, CEO of Quaker Oats
Roles the Brands Play (Customer Side)
Identification of source of product
Assignments of responsibility to product maker
Risk reducer
Search cost reducer
Promise, Bond, or Pact with maker of product
Symbolic device
Signal of quality
Identification of source of product
Consumers can identify the source or maker of a product.
Assignments of responsibility to product maker
Enables consumers to assign responsibility to a particular manufacturer or distributor.
Risk reducer
Brands can reduce the risks in product decisions which is perceived by consumers and which include Functional Risk, Physical risk, Financial risk, Social risk, Psychological risk, Time risk.
Search cost reducer
From an economic perspective, brands allow consumers to lower the ‘search costs’ for products both internally and externally.
Promise, Bond, or Pact with maker of product
As long as consumers realize advantages and benefits from purchasing the brand, and as long as they derive satisfaction from product consumption, they are likely to continue to buy it.
Symbolic device
Brands can serve as symbolic devices, allowing consumers to project their self-image. Certain brands are associated with certain types of people and thus reflect different value or traits.
Signal of quality
Brands can also play a significant role in signaling certain product characteristics to consumers.
Roles the Brands Play (Manufacturer Side)
Means of identification to simplify handling or tracing
Means of legally protecting unique features
Source of competitive advantage
Signal of quality level to satisfied customers
Means of endowing products with unique associations
Source of financial returns
Means of identification to simplify handling or tracing
Brands serve an identification purpose, to simplify product handling or tracing. Brands help to organize inventory and accounting records.
Means of legally protecting unique features
The brand also offers the firm legal protection for unique features or aspects of the product.
A brand can retain intellectual property rights, giving legal title to the brand owner.
The brand name can be protected through patents.
Packaging can be protected through copyrights and designs.
Source of competitive advantage
Although manufacturing processes and product designs may be easily duplicated, lasting impressions in the minds of individuals and organizations from years of marketing activity and product experience may not be so easily reproduced.
Signal of quality level to satisfied customers
Brands can signal a certain level of quality so that satisfied buyers can easily choose the product again. This brand loyalty provides predictability and security of demand for the firm and creates barriers of entry that make it difficult for other firms to enter the market.
Source of financial returns
Most of the value of a firm lies in intangible assets & goodwill. As much as 70% of intangible assets are supplied by brands.
What risks might consumers perceive in buying and consuming a product. (These risks may be reduced by brands.)
Functional Risk
Physical Risk
Financial Risk
Social Risk
Psychological Risk
Time Risk
Functional Risk
The product does not perform up to expectations.
“Search goods”, “experience goods” & “credence goods”.
Physical Risk
The product poses a threat to the physical well-being or health of the user or others.
Financial Risk
Social Risk
Psychological Risk
Time Risk
The product is not worth the price paid.
Social Risk
The product results in embarrassment from others.
Psychological Risk
The product affects the mental well-being of the user.
Time Risk
The failure of the product results in an opportunity cost of finding another satisfactory product.
credence goods
impossible to assess the quality of the goods–you have to believe the seller that it will deliver
To firms, brands represent…
…enormously valuable pieces of legal property, capable of influencing consumer behavior, being bought and sold, and providing the security of sustained future revenues.
For a typical fast-moving consumer goods company, net tangible assets may be as little as…
…10% of the total value.
For a typical fast-moving consumer goods company, most of the value lies in…
…intangible assets and goodwill.
For a typical fast-moving consumer goods company, as much as __% of intangible assets can be supplied by brands of the company.
70%
Ultimately a brand is something that resides in…
…the minds of consumers.
A brand is a __ __ rooted in reality.
perceptual entity
A brand reflects the __ and perhaps even the __ of consumers.
perceptions, idiosyncrasies
Marketers are giving consumers a “__” and a “__” to their products.
label, meaning
The key to branding is…
…consumers perceive differences among brands in a product category.
__ can play an important decision-making role whenever and wherever consumers are deciding between alternatives.
Brands
Marketers can benefit from branding whenever consumers are in a __ __.
choice situation.
commodity
a product so basic that it cannot be physically differentiated in the minds of consumers.
However, even commodities can be branded nowadays:
Coffee (Maxwell House), bath soap (Ivory), flour (Gold Medal), beer (Budweiser), salt (Morton), oatmeal (Quaker), pickles (Vlasic), bananas (Chiquita), chicken (Perdue), pineapples (Dole), and even water (Perrier).
What can be branded?
Physical Goods; Services; retailers and distributors; online products and services; people and organizations, sports, arts and entertainment; geographic locations; ideas and causes.
One of the challenges in marketing services is that…
…they are less tangible than products and more likely to vary in quality, depending on the particular person or people providing them.
Branding a service can also be an effective way to…
…signal to consumers that the firm has designed a particular service offering that is special and deserving of its name.
Retailers can introduce their own brands by…
…using their store name, creating new names, or some combination of the two.
Many distributors, especially in Europe, have actually introduced…
…their own brands, which they sell in addition to- or sometimes even instead of- manufacturers’ brands.
Products bearing these store brands or private label brands offer another way for retailers to…
…increase customer loyalty and generate higher margins and profits.
The end of the twentieth century saw an unprecedented headlong rush by new and existing businesses to create…
…online brands.
But many online markers made serious- and sometimes fatal- mistakes during this heady time.
What realities of brand building did online marketers miss?
First, it is critical to create unique aspects of the brands on some dimension important to consumers, such as convenience, price , variety, etc.
At the same time, the brand needs to perform satisfactorily in other areas, such as customer service, credibility, and personality.
Increased mobility of both people and businesses, and growth in the tourism industry, have contributed to the rise of…
…‘place marketing’
Examples of branded ideas and causes
WWF
Susan G. Komen for the Cure
A number of brands with amazing staying power that have been market leaders in their categories for decades. According to research by marketing consultant Hack Trout, in 25 popular product categories, __ of the leading brands in 1923 are still leading brands today!
20
Some recent developments that have significantly complicated marketing practices and pose challenges for brand management:
Savvy Customers
Brand Proliferation
Media Fragmentation
Increased Competition
Increased Costs
Greater Accountability
Savvy Customers
Increasingly, consumers and businesses have become more experienced with marketing, more knowledgeable about how it works, and more demanding.
Brand Proliferation
A brand name may now be identified with a number of different products with varying degrees of similarities.
Media Fragmentation
Erosion of traditional advertising media and the emergence of interactive and nontraditional media, promotion, and other communication alternatives.
Increased Competition
Competitive intensity due to globalization, low-priced competitors, brand extensions, deregulation in certain industries (telecom, financial services, healthcare, etc.).
Increased Costs
Cost of introducing a new product or supporting an existing product has increased rapidly.
Greater Accountability
Marketers often find themselves responsible for meeting ambitious short-term profit targets because of financial market pressures and senior management imperatives.
In this postmodern marketing world, many believe that it is more difficult to…
…persuade consumers with traditional communications than it used to be.
Other marketers believe that what consumers want from products and services and brands has changed.
Another important change in the branding environment is the proliferation of new brands and product, in part spurred by the rise in…
…line and brand extensions.
Reasons why marketers are disenchanted with traditional advertising media:
Cost
Clutter
Fragmentation
Technology
New competitors have emerged due to a number of factors, such as…
…globalization, low-price competitors, brand extensions, and deregulation.
By 2000, an estimated 30,000 new consumer products were introduced in the US, at a failure rate of around __%.
The total failure cost conservatively exceeded __.
93%
$20 billion.
The average tenure of a CMO is only…
…23 months.
There is no common viewpoint on how __ __ should be conceptualized and measured.
brand equity
Brand equity stresses the importance of…
…brand role in marketing strategies.
Brand equity is defined in terms of the…
…marketing effects uniquely attributable to the brand.
Brand equity relates to the fact that different outcomes result in…
…the marketing of a product or service because of its brand name, as compared to if the same product or service did not have that brand name.
Differences in outcomes arise from the “added value” endowed to a product as a result of…
…past marketing activity for the brand.
Brand equity provides a __ __ for interpreting marketing strategies and assessing the value of a brand.
common denominator
Strategic Brand Management involves the …
…design and implementation of marketing programs and activities to build, measure, and manage brand equity.
The Strategic Brand Management Process is defined as involving four main steps:
- Identifying and establishing brand positioning and values
- Planning and implementing brand marketing programs
- Measuring and interpreting brand performance
- Growing and sustaining brand equity
- Identify and establish
brand positioning and values
What are the key concepts used?
Mental maps Competitive frame of reference Points-of-parity and points-of-difference Core brand values Brand mantra
- Planning and implementing brand marketing programs
What are the key concepts used?
Mixing and matching of brand elements
Integrating brand marketing activities
Leveraging of secondary associations
- Measuring and interpreting brand performance
What are the key concepts used?
Brand value chain
Brand audits
Brand tracking
Brand equity management system
- Growing and sustaining brand equity
What are the key concepts used?
Brand-product matrix
Brand portfolios and hierarchies
Brand expansion strategies
Brand reinforcement and revitalization
The strategic brand management process starts with a clear understanding of the __ strategy.
“positioning”
Positioning is the
“act of designing the company’s offer and image so that it occupies a distinct and valued place in the minds of target customers.”
Effective positioning convinces consumers of the advantages or __ __ __, while reducing concerns about any possible disadvantages (establishing __ __ __).
points of difference, points of parity
mental map
a visual depiction of different associations linked to the brand in the minds of consumers.
Brand mantra
the brand essence or core brand promise….the enduring “brand DNA”.
When Planning and ImplementingBrand Marketing Programs, The knowledge-building process will depend on three factors:
- ) The initial choices of the brand elements or identities making up the brand and how they are mixed and matched
- ) The marketing activities and supporting marketing program and the way the brand is integrated into them
- ) Other associations indirectly transferred to or leveraged by the brand as a result of linking it to some other entity( such as the company, country of origin, channel of distribution, or other brands)
Three ways to build brand equity
Choosing Brand Elements
Integrating the Brand into Marketing Activities and the Supporting Marketing Program
Leveraging secondary Associations
brand audit
a comprehensive examination of a brand to assess its health, uncover its sources of equity, and suggest ways to improve and leverage that equity.
brand value chain
a means to trace the value creation process for brands, to better understand the financial impact of brand marketing expenditures and investments.
To manage their brands profitably, managers must…
…successfully design and implement a brand equity measurement system.
brand equity measurement system
a set of research procedures designed to provide timely, accurate, and actionable information for marketers so that they can make the best possible tactical decisions in the short run and the system involves two key steps - conducting brand tracking and implementing a brand equity management system.
Ways to grow and sustain brand equity
Defining the Branding Strategy
Managing Brand Equity over Time
Managing Brand Equity over geographic boundaries, cultures, and market segments
Features of Defining the Branding Strategy
brand-product matrix
brand hierarchy
brand portfolio
brand-product matrix
a graphical representation of all the brands and products sold by the firm.
brand hierarchy
displays the number and nature of common and distinctive brand components across the firm’s products.
brand portfolio
the set of all brands and brand lines that a particular firm offers for sale to buyers in a particular category.
