What is a brand ? A traditional scenario of market Company A Consumer Product / services In a traditional market scenario, the company is catering to the consumer. The number of competitors are small. In these markets the companies can come with advanced technologies and other strategies to capture more market share. (The size and power of the players is important.) Company B Company C
What is a brand ? Company A Consumer Product / services In complex markets, the differences between companies are not much. The companies can not differentiate much themselves from others on the basis of quality and technology etc. factors as all the companies are competent enough. This scenario explains the need for the differentiation for the companies. Company B Company C
What is a brand ? Branding is an effort to give a unique identity to the company’s products and create emotional associations with consumers. It is a form of marketing. A brand is a set of associations that are linked to a product range, a division, or company. These associations reside in the memory of customers. These associations help customers understand what the brand or company is, why it is potentially relevant to them, how it is different or similar to other products made by the company, and how it is similar or different from competitor’s products.
What is a brand ? Branding is a combined effort of the company which is projected to the consumer. Company Brand Consumer Marketing Design
What is a brand ? What a brand means to common person ? In 'blind' taste tests, people prefer the taste of Pepsi over the taste of Coke. However, if the test is not 'blind' and the tasters know which beverage is which, they might prefer the taste of Coke over Pepsi! That is the emotional power of a brand. The Coca-Cola brand has the power to actually change an individual's taste! Coca-cola is the no.1 brand in the world. The first shape that was registered is the coca cola bottle.
Company Product A Product B Product Packaging Websites Advertisements A brand is a promise. A promise to achieve certain results, deliver a certain experience, or act in a certain way. A promise that is conveyed by everything people see, hear, touch, taste or smell about your business. logo Integrity of Brand
Company Design Brand Marketing Manufacturing And organizing Customer
Perspectives to view brand equity:
There are at least three perspectives from which to view brand equity:
Financial - One way to measure brand equity is to determine the price premium that a brand commands over a generic product. For example, if consumers are willing to pay $100 more for a branded television over the same unbranded television, this premium provides important information about the value of the brand. However, expenses such as promotional costs must be taken into account when using this method to measure brand equity.
Perspectives to view brand equity
Brand extensions - A successful brand can be used as a platform to launch related products. The benefits of brand extensions are the leveraging of existing brand awareness thus reducing advertising expenditures, and a lower risk from the perspective of the consumer. Furthermore, appropriate brand extensions can enhance the core brand. However, the value of brand extensions is more difficult to quantify than are direct financial measures of brand equity.
Consumer-based - A strong brand increases the consumer's attitude strength toward the product associated with the brand. Attitude strength is built by experience with a product. This importance of actual experience by the customer implies that trial samples are more effective than advertising in the early stages of building a strong brand. The consumer's awareness and associations lead to perceived quality, inferred attributes, and eventually, brand loyalty.
Benefits of Strong Brand Equity
Facilitates a more predictable income stream.
Increases cash flow by increasing market share, reducing promotional costs, and allowing premium pricing.
Brand equity is an asset that can be sold or leased.
However, brand equity is not always positive in value. Some brands acquire a bad reputation that results in negative brand equity. Negative brand equity can be measured by surveys in which consumers indicate that a discount is needed to purchase the brand over a generic brand/product.
Some Parameters of Measuring Brand Equity
Market (10%)-The brand’s trading environment in terms of growth prospects, volatility, and barriers to entry. Brands in markets such as foods, drinks, and publishing are intrinsically more valuable than brands in, for example, high-tech or clothing areas, as the latter markets are more vulnerable to technological or fashion changes.
Geographic Spread (25%)-The ability of the brand to cross geographic and cultural borders. Brands that are international are inherently more valuable than national or regional brands.
Measuring Brand Equity
Trend (10%)-The ongoing direction and ability of the brand to remain contemporary and relevant to consumers.
Support (10%)-The amount and consistency of marketing and communication activity. Those brands that have received consistent investment and focused support must be regarded as more valuable than those that have not. While the amount spent in supporting a brand is important, the quality of this support is equally significant.
Protection ( 5%)-The brand owner’s legal titles. A registered trademark is a statutory monopoly in a name, device, or in a combination of these two. The strength and breadth of the brand’s protection is critical in assessing its worth.
Building and Managing Brand Equity
In his 1989 paper, Managing Brand Equity , Peter H. Farquhar outlined the following three stages that are required in order to build a strong brand:
Introduction - introduce a quality product with the strategy of using the brand as a platform from which to launch future products. A positive evaluation by the consumer is important.
Elaboration - make the brand easy to remember and develop repeat usage. There should be accessible brand attitude, that is, the consumer should easily remember his or her positive evaluation of the brand.
Fortification - the brand should carry a consistent image over time to reinforce its place in the consumer's mind and develop a special relationship with the consumer. Brand extensions can further fortify the brand, but only with related products having a perceived fit in the mind of the consumer.