Session 14 MG 220 BBA - 4 Oct 10

Part 4: Building Strong Brands
> What is Brand Equity?
> Building Brand Equity
> Measuring Brand Equity
> Discussion on Results of Mid I
Class Presentation | Session 14 | 4 Oct 2010

BRANDS!!!!ALL AROUND US….
Class Discussion on what brands are:
MG 220 Marketing Management
2

What is Brand EquityDefining Brands & Role of Brands
What is a brand?
AMA definition:
“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 competitors”
Brands identify source
Consumer identify products through brands as to which satisfy their needs and which don’t
For Companies:
Brands simplify product handling | inventory management
Legal Protection
Brands signal a certain level of quality => predictability of demand for firm
Competitors can duplicate manufacturing process, but cannot match impressions created from years of marketing
3

What is Brand EquityThe scope of Branding
Branding is all about creating differences. To brand a product, it is necessary to teach consumers:
Who the product is
What the product does
Why consumers should care
Consumers must be convinced that there are meaningful differences among products in a category
Branding can be applied virtually anywhere where there is choice. Consider branding:
Goods
Services
Stores
Person
Place
Organization
Ideas and so on…
4

What is Brand EquityDefining Brand Equity
Brand Equity is added value endowed to product or service
Most important is to see what the brand is for customers
Thus the concept of Customer-based brand equity: Differential effect that brand knowledge has on consumer response to the marketing of that brand
It can be either positive or negative based on customers reaction
Three key components of brand equity:
Differences in customer response
Brand Knowledge
Perceptions, preferences and behavior related
Brand Equity as a Bridge
Marketing investments in brand-building need to be carefully evaluated
Brand knowledge created in this process acts dictates future direction of brand
5

What is Brand EquityBrand Equity Models
1. Brand Asset Valuator (BAV)
Developed by Young & Rubicam (Y&R) ad agency
Four key pillars of brand equity:
Differentiation (how much it is seen different from others)
Relevance (breadth of brand’s appeal)
Esteem (respect)
Knowledge (familiarity of consumers)
Differentiation & Relevance: Brand Strength – the future direction
Esteem & Knowledge: Brand Stature – report of past performance
A power grid is formed to identify brand development
New brands (low on all DREK)
Strong New brands (high on D than R, but low on EK)
Leadership brands (high on all DREK)
Declining brands (K highest, then E and low DR)
Some examples for BAV model from local brands
6

2. Aaker Model
Developed by David Aaker
Five key categories of brand asset (or liability) are:
Brand Loyalty
Brand Awareness
Perceived Quality
Brand Associations
Proprietary assets
Brand identity is key to building brand equity. Its 4 perspectives are:
Brand as product (prod scope, attributes, quality, uses, users, country of origin)
Brand as organization (org. attributes, local vs global)
Brand as person (brand personality, brand-customer relationships)
Brand as symbol (visual imagery/metaphors and brand heritage)
Brand identity includes:
Core identity – central, timeless essence of brand
Extended identity - combination of various brand identity elements organized into meaningful, cohesive groups
Some examples for Aaker model
7

3. BRANDZ
Developed by Market Research consultants Millward Brown and WPP
Brand building is a process of sequential steps each completed after the other:
Presence – Do I know about it?
Relevance – Does it offer me something?
Performance – Can it deliver?
Advantage – Does it offer something different than others?
Bonding – Nothing else beats it
Bonded consumers are loyal and spend more but are less in numbers
4. BRAND RESONANCE
Also in sequential steps
Identity: Ensuring brand’s identification with specific product/category
Meaning: Firmly establishing totality of brand meaning in minds
Response: eliciting proper customer response
Relationships: converting responses into relationships
Brand building blocks:
Brand salience (how often and easily brand is though about in purchase)
Brand performance (how brand meets customer needs)
Brand imagery (how brand meets psych. and social needs)
Brand judgments (consumer’s own personal opinion and judgments)
Brand feelings (customer’s emotional responses and reaction)
Brand resonance (extent to which customers are in synch)
8

Brand resonance pyramid helps identify psychological bond consumers have with the brand
9

What is Brand EquityBuilding Brand Equity
Process of building brand equity is:
Initial choices for brand elements or identities that make a brand
Product and services and all accompanying marketing activities and supporting marketing programs
Other associations by linking it to some other entity
1. Choosing Brand Elements
Trademark elements which are used to identify and differentiate brand
Brand element choice criteria
Developing Brand Elements – through strong research and understanding of consumer preferences and perceptions
10

2. Developing Holistic Marketing Activities
Brands are not built by advertising alone
Range of contacts and touchpoints are used
Brand contact is an information-bearing experience a customer or prospect has with the brand, the product category or the market that relates to the marketer’s product or services
Three important themes in marketing activities for brand development are:
Personalization
Making it as relevant to consumers
Integration
Mixing and matching marketing activities
Brand awareness is consumers’ ability to identify brand under different circumstances
Brand image is perception and belief held by consumer as reflected in associations held in memory
Internalization
Ensuring that employees also ‘live the brand’
B2E – Business to Employees
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3. Leveraging Secondary Associations
Brands associations may be linked further to other entities having their own associations thus creating ‘secondary associations’
This is an important way of building brand equity by ‘borrowing it’
12

What is Brand EquityMeasuring Brand Equity
Indirect approach – assessing potential sources of brand equity by identifying consumer’s brand knowledge structures
Direct approach – actual impact of brand knowledge on consumer’s response to different aspect of marketing
Important for marketers:
Identify sources of brand equity – Brand audits
How these sources and outcomes change, if at all over time – Brand tracking
Brand audits
Consumer-focused exercise
Involving series of procedures to assess health of brand and uncover its sources of brand equity and suggest ways to improve and leverage its equity
Brand tracking
Information collection to understand the performance of brands
Generally use quantitative measures
Brand Valuation
Putting a financial value to brand
May even be shown in balance sheet!
13

Part 4: Building Strong Brands
> Managing Brand Equity
> Devising a Branding Strategy
> Developing & Communicating a Positioning Strategy
> Differentiation Strategies
> Product Life-Cycle Marketing Strategies
> Quiz 4 (Part 3: Chap 7 & 8)
Class Presentation | Session 15 | 6 Oct 2010

Session 14 MG 220 BBA - 4 Oct 10

by Muhammad Talha Salam on Oct 11, 2010

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Session 14 MG 220 BBA - 4 Oct 10 Presentation Transcript