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  • 1. 7.1CHAPTER 7:CHAPTER 7:LEVERAGING SECONDARY BRANDLEVERAGING SECONDARY BRANDKNOWLEDGE TO BUILD BRAND EQUITYKNOWLEDGE TO BUILD BRAND EQUITYKevin Lane KellerKevin Lane KellerTuck School of BusinessTuck School of BusinessDartmouth CollegeDartmouth College
  • 2. 7.2Figure 2-9 Building Customer-Based Brand EquityBRAND BUILDING TOOLS AND OBJECTIVES CONSUMER KNOWLEDGE EFFECTS BRANDING BENEFITSChoosing Brand ElementsBrand name MemorabilityLogo MeaningfulnessSymbol AppealCharacter TransferabilityPackaging AdaptabilitySlogan ProtectabilityDeveloping Marketing ProgramsProduct Tangible and intangible benefitsPrice Value perceptionsDistribution channels Integrate”push” and “pull”Communications Mix and match optionsLeverage of Secondary AssociationsCompanyCountry of originChannel of distributionOther brandsEndorsorEventAwarenessMeaningfulnessTransferabilityPossible OutcomesGreater loyaltyLess vulnerability to competitivemarketing actions and crisesLarger marginsMore elastic response to pricedecreasesMore inelastic response to priceincreasesGreater trade cooperation andsupportIncreased marketing communicationefficiency and effectivenessPossible licensing opportunitiesMore favorable brand extensionevaluationsBrand AwarenessDepthBreadthRecallRecognitionPurchaseConsumptionBrand AssociationsStrongFavorableUniqueRelevanceConsistencyDesirableDeliverablePoint-of-parityPoint-of-difference
  • 3. 7.3Leveraging Secondary AssociationsLeveraging Secondary Associations Creation of new brand associationsCreation of new brand associations Effects on existing brand knowledgeEffects on existing brand knowledge Awareness and knowledge of the entityAwareness and knowledge of the entity Meaningfulness of the knowledge of the entityMeaningfulness of the knowledge of the entity Transferability of the knowledge of the entityTransferability of the knowledge of the entity
  • 4. 7.4Leveraging Secondary AssociationsLeveraging Secondary Associations Brand associations may themselves be linked to otherBrand associations may themselves be linked to otherentities, creating secondary associations:entities, creating secondary associations: Company (through branding strategies)Company (through branding strategies) Country of origin (through identification of product origin)Country of origin (through identification of product origin) Channels of distribution (through channels strategy)Channels of distribution (through channels strategy) Other brands (through co-branding)Other brands (through co-branding) Special case of co-branding isSpecial case of co-branding is ingredient brandingingredient branding Characters (through licensing)Characters (through licensing) Celebrity spokesperson (through endorsement advertising)Celebrity spokesperson (through endorsement advertising) Events (through sponsorship)Events (through sponsorship) Other third-party sources (through awards and reviews)Other third-party sources (through awards and reviews)
  • 5. 7.5 These secondary associations may lead to aThese secondary associations may lead to atransfer of:transfer of: Response-type associationsResponse-type associations Judgments (especially credibility)Judgments (especially credibility) FeelingsFeelings Meaning-type associationsMeaning-type associations Product or service performanceProduct or service performance Product or service imageryProduct or service imageryLeveraging Secondary AssociationsLeveraging Secondary Associations
  • 6. 7.6Co-BrandingCo-Branding Occurs when two or more existing brands areOccurs when two or more existing brands arecombined into a joint product or are marketedcombined into a joint product or are marketedtogether in some fashiontogether in some fashion Examples:Examples: Sony EricssonSony Ericsson Yoplait Trix YogurtYoplait Trix Yogurt Nestle’s Cheerios Cookie BarsNestle’s Cheerios Cookie Bars
  • 7. 7.7Advantages of Co-BrandingAdvantages of Co-Branding Borrow needed expertiseBorrow needed expertise Leverage equity you don’t haveLeverage equity you don’t have Reduce cost of product introductionReduce cost of product introduction Expand brand meaning into related categoriesExpand brand meaning into related categories Broaden meaningBroaden meaning Increase access pointsIncrease access points Source of additional revenueSource of additional revenue
  • 8. 7.8Disadvantages of Co-BrandingDisadvantages of Co-Branding Loss of controlLoss of control Risk of brand equity dilutionRisk of brand equity dilution Negative feedback effectsNegative feedback effects Lack of brand focus and clarityLack of brand focus and clarity Organizational distractionsOrganizational distractions
  • 9. 7.9Ingredient BrandingIngredient Branding A special case of co-branding that involvesA special case of co-branding that involvescreating brand equity for materials,creating brand equity for materials,components, or parts that are necessarilycomponents, or parts that are necessarilycontained within other branded productscontained within other branded products Examples:Examples: Betty Crocker baking mixes with Hershey’sBetty Crocker baking mixes with Hershey’schocolate syrupchocolate syrup Intel insideIntel inside
  • 10. 7.10LicensingLicensing Involves contractual arrangements wherebyInvolves contractual arrangements wherebyfirms can use the names, logos, characters, andfirms can use the names, logos, characters, andso forth of other brands for some fixed feeso forth of other brands for some fixed fee Examples:Examples: Entertainment (Star Wars, Jurassic Park, etc.)Entertainment (Star Wars, Jurassic Park, etc.) Television and cartoon characters (The Simpsons)Television and cartoon characters (The Simpsons) Designer apparel and accessories (Calvin Klein,Designer apparel and accessories (Calvin Klein,Pierre Cardin, etc.)Pierre Cardin, etc.)
  • 11. 7.11Celebrity EndorsementCelebrity Endorsement Draws attention to the brandDraws attention to the brand Shapes the perceptions of the brandShapes the perceptions of the brand Celebrity should have a high level of visibilityCelebrity should have a high level of visibilityand a rich set of useful associations, judgments,and a rich set of useful associations, judgments,and feelingsand feelings Q-Ratings to evaluate celebritiesQ-Ratings to evaluate celebrities
  • 12. 7.12Celebrity Endorsement: Potential ProblemsCelebrity Endorsement: Potential Problems Celebrity endorsers can be overused by endorsingCelebrity endorsers can be overused by endorsingmany products that are too varied.many products that are too varied. There must be a reasonable match between theThere must be a reasonable match between thecelebrity and the product.celebrity and the product. Celebrity endorsers can get in trouble or loseCelebrity endorsers can get in trouble or losepopularity.popularity. Many consumers feel that celebrities are doing theMany consumers feel that celebrities are doing theendorsement for money and do not necessarilyendorsement for money and do not necessarilybelieve in the endorsed brand.believe in the endorsed brand. Celebrities may distract attention from the brand.Celebrities may distract attention from the brand.
  • 13. 7.13Sporting, Cultural, or Other EventsSporting, Cultural, or Other Events Sponsored events can contribute to brand equitySponsored events can contribute to brand equityby becoming associated to the brand andby becoming associated to the brand andimproving brand awareness, adding newimproving brand awareness, adding newassociations, or improving the strength,associations, or improving the strength,favorability, and uniqueness of existingfavorability, and uniqueness of existingassociations.associations. The main means by which an event can transferThe main means by which an event can transferassociations is credibility.associations is credibility.
  • 14. 7.14Third-Party SourcesThird-Party Sources Marketers can create secondary associations in aMarketers can create secondary associations in anumber of different ways by linking the brand tonumber of different ways by linking the brand tovarious third-party sources.various third-party sources. Third-party sources can be especially credibleThird-party sources can be especially crediblesources.sources. Marketers often feature them in advertisingMarketers often feature them in advertisingcampaigns and selling efforts .campaigns and selling efforts . Example:Example: J.D. Power and Associates’ well-publicizedJ.D. Power and Associates’ well-publicizedCustomer Satisfaction IndexCustomer Satisfaction Index