strategic-brand-management

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strategic-brand-management

  1. 1. Strategic Brand Management WELCOME!! Soni Simpson
  2. 2. “Brand Team” Introductions  Name  Personal Demographics – Who You Work for – What You Do All Day – Undergraduate Focus – What Degree You’re Working on  What Courses You’ve Completed/Are In  Personal Psychographics – Something Fun/Unique About Yourself – What Motivates You – Why You’re Here Tonight Communicate your personal brand essence and call to action In :30 please…
  3. 3. Course Overview  What Do You Think You’re Going to Learn this Quarter?  We’re going to define and refine our thinking about brands, what they are and how to manage them  We’ll build off text, industry experts & studies, guest lecturers, real life experience and class exercises
  4. 4. 09/10/03 AGENDA  Top Brands  Brand vs Product vs Company  Product Levels  Brand Definition  Brand Relevance  Power and Corporate Brands  Brand Equity  Brand Value  Good To Great Companies/Hedgehog Strategic Brand Management TACTICAL Application •Brand Share •Brand Management •Brand Management Task Models •IN CLASS CASE STUDIES •Self Positioning •Du Pont Case Study •Due Next Week
  5. 5. Strategic Brand Management The World's 10 Most Valuable Brands - 2002 VALUE ($billions) 1 COCA-COLA 69.6 2 MICROSOFT 64.1 3 IBM 51.2 4 GE 41.3 5 INTEL 30.9 6 NOKIA 30.0 7 DISNEY 29.3 8 McDONALD'S 26.4 9 MARLBORO 24.2 10 MERCEDES 21.0 Data: Interbrand Corp., J.P. Morgan Chase & Co / Business Week AUGUST 5, 2002 Interbrand’s Assessment is of Brand Power – the fullest possible view of each brand’s strengths and potential as a marketing and financial asset.
  6. 6. Strategic Brand Management The Top 10 Global Marketers - 2002 Ad Spending Outside US (MMs) 1 UNILEVER 2,967 2 PROCTOR & GAMBLE 2,610 3 NESTLE 1,560 4 TOYOTA 1,345 5 VOLKSWAGON 1,290 6 COCA-COLA CO. 1,176 7 FORD MOTOR CO. 1,127 8 GENERAL MOTORS 1,028 9 PSA PEUGEOT CITROEN1,004 10 FIAT 998 Data: Global Marketers (Ad Age Global, 11/01) Ranks advertisers by estimated total measured advertising outside the US Ad Age Fact Pack; Sept 9, 2002
  7. 7. Strategic Brand Management The Top 10 Global Marketers - 2002 Ad Spending Outside US (MMs) 1 UNILEVER 2,967 2 PROCTOR & GAMBLE 2,610 3 NESTLE 1,560 4 TOYOTA 1,345 5 VOLKSWAGON 1,290 6 COCA-COLA CO. 1,176 7 FORD MOTOR CO. 1,127 8 GENERAL MOTORS 1,028 9 PSA PEUGEOT CITROEN1,004 10 FIAT 998 Data: Global Marketers (Ad Age Global, 11/01) Ranks advertisers by estimated total measured advertising outside the US Ad Age Fact Pack; Sept 9, 2002 The World's 10 Most Valuable Brands - 2002 VALUE ($billions) 1 COCA-COLA 69.6 2 MICROSOFT 64.1 3 IBM 51.2 4 GE 41.3 5 INTEL 30.9 6 NOKIA 30.0 7 DISNEY 29.3 8 McDONALD'S 26.4 9 MARLBORO 24.2 10 MERCEDES 21.0 Data: Interbrand Corp., J.P. Morgan Chase & Co / Business Week AUGUST 5, 2002
  8. 8. Strategic Brand Management The Top 10 US Mega Brands - 2002 US Ad Spending ($MM) 1 AT&T 996.6 2 Verizon 824.4 3 Chevrolet 780.4 4 Ford 655.9 5 Mc Donald’s 635.1 6 Sprint 620.4 7 Toyota 568.3 8 Sears 511.5 9 Dodge 499.2 10 Chrysler 474.4 Data: Megabrands, AA July 22, 2002 Media Dollars excluding promotion & direct marketing expenses Ad spending for CY2001
  9. 9. Strategic Brand Management The Top 10 US Advertisers - 2002 US Ad Spending ($BIL) 1 General Motors 3.37 2 P&G 2.54 3 Ford 2.41 4 Pepsi Co 2.21 5 Pfizer 2.19 6 Daimler-Chrysler 1.99 7 AOL Time Warner 1.89 8 Philip Morris 1.82 9 Walt Disney 1.76 10 Johnson & Johnson 1.62 Data: 100 Leading National Advertisers (AA June 24, 2002) Ad spending for CY2001 includes advertising, promotion and direct marketing expenses
  10. 10. Strategic Brand Management The Top 10 US Mega Brands - 2002 US Ad Spending ($MM) 1 AT&T 996.6 2 Verizon 824.4 3 Chevrolet 780.4 4 Ford 655.9 5 Mc Donald’s 635.1 6 Sprint 620.4 7 Toyota 568.3 8 Sears 511.5 9 Dodge 499.2 10 Chrysler 474.4 Data: Megabrands, AA July 22, 2002 Media Dollars excluding promotion & direct marketing expenses Ad spending for CY2001 The Top 10 US Advertisers - 2002 US Ad Spending ($BIL) 1 General Motors 3.37 2 P&G 2.54 3 Ford 2.41 4 Pepsi Co 2.21 5 Pfizer 2.19 6 Daimler-Chrysler 1.99 7 AOL Time Warner 1.89 8 Philip Morris 1.82 9 Walt Disney 1.76 10 Johnson & Johnson 1.62 Data: 100 Leading National Advertisers (AA June 24, 2002) Ad spending for CY2001 includes advertising, promotion and direct marketing expenses
  11. 11. What is a Product?  Kotler’s Five levels to a product: Generic Product CORE BENEFIT Expected Product Augmented Product Potential Product
  12. 12. What is a Product?  Kotler’s Five levels to a product: CORE BENEFIT Generic Product Expected Product Augmented Product Potential Product The Fundamental Need or Want that consumers satisfy by consuming the product or service
  13. 13. What is a Product?  Kotler’s Five levels to a product: CORE BENEFIT Expected Product Augmented Product Potential Product Generic Product Basic Version of the product containing only those elements absolutely necessary to function. No distinguishing features.
  14. 14. What is a Product?  Kotler’s Five levels to a product: CORE BENEFIT Augmented Product Potential Product Generic Product Expected Product Attributes and Characteristics that buyers normally expect and agree to when they purchase a product
  15. 15. What is a Product?  Kotler’s Five levels to a product: CORE BENEFIT Potential Product Generic Product Expected Product Augmented Product Additional product attributes, benefits, or related services that distinguish the product from competitors
  16. 16. What is a Product?  Kotler’s Five levels to a product: CORE BENEFIT Generic Product Expected Product Augmented Product Potential Product All the augmentations and transformations that a product might ultimately undergo in the future
  17. 17. What is a Product?  Kotler’s Five levels to a product: Generic Product CORE BENEFIT Expected Product Augmented Product Potential Product The Fundamental Need or Want that consumers satisfy by consuming the product or service Generic Product Basic Version of the product containing only those elements absolutely necessary to function. No distinguishing features. Expected Product Attributes and Characteristics that buyers normally expect and agree to when they purchase a product Augmented Product Additional product attributes, benefits, or related services that distinguish the product from competitors Potential Product All the augmentations and transformations that a product might ultimately undergo in the future
  18. 18. What is a Brand?  Not simply a product -- anything offered to a market for attention, acquisition, use, or consumption that might satisfy a need or want.  A product can be: – Physical good – Service – Retail Store – Person – Organization – Place – Idea
  19. 19. What is a Brand? Product = Commodity A product is a produced item always possessing these characteristics: • Tangibility •Attributes and Features Brand = “Mind Set” The sum of all communications and experiences received by the consumer and customer resulting in a distinctive image in their “mind set” based on perceived emotional and functional benefits. Timothy D. Ennis, Ennis Associates, Inc
  20. 20. What is a Brand?  Derivation – Old Norse “brandr” = to burn – branding livestock  Heritage – A means to distinguish goods from one producer vs another.  AMA (technical definition) – “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”
  21. 21. What is a Brand?  AMA defines a brand vs a Brand.  What does the AMA definition leave out?
  22. 22. What is a Brand?  Keller’s Definition: – A product, but one that adds other dimensions that differentiate it in some way from other products designed to satisfy the same need.  Rational and tangible  Symbolic, emotional and intangible  The psychological response to a brand can be as important as the physiological response.
  23. 23. What is a Brand? Product = Commodity A product is a produced item always possessing these characteristics: • Tangibility •Attributes and Features Brand = “Mind Set” The sum of all communications and experiences received by the consumer and customer resulting in a distinctive image in their “mind set” based on perceived emotional and functional benefits. Timothy D. Ennis, Ennis Associates, Inc
  24. 24. MANUFACTURERS  ID to simplify handling or tracing  Legal protection of unique features  Signal of quality level to satisfied customers  Means of endowing products w/unique associations  Competitive Advantage  Financial Returns CONSUMERS  ID Product Source  Assignment of responsibility to maker  Risk reducer  Search cost reducer  Promise, bond, or pact w/make of product  Symbolic Device  Signal of Quality Why Does A Brand Matter?
  25. 25. What is a Brand?  Products don’t exist in a void…  They are bought because consumers have found something they relate to in them, something which they value  Brand = Credible Guarantee
  26. 26. What is a Brand?  Relative Brand Distinction – The more distinctive or different a brand is in the consumers “mind set”, the stronger brand preference becomes. This is critical to keeping competition from the consumer’s consideration. Strong Brand Perceived by the Consumer as Unique Products (Commodities) No Difference Except Price Brand Name Well Known But Similar Brand Distinctive Timothy D. Ennis, Ennis Associates, Inc
  27. 27. What is a Brand?  Relative Brand Distinction – A brand’s preference is primarily built through differentiation and relevance – Insulate product from competition – OWN Something Products (Commodities) No Difference Except Price Brand Name Well Known But Similar Brand Distinctive Strong Brand Perceived by the Consumer as Unique Timothy D. Ennis, Ennis Associates, Inc
  28. 28. Generic Product CORE BENEFIT Expected Product Augmented Product Potential Product Kotler’s Five Levels of A Product What is a Brand? Products (Commodities) No Difference Except Price Brand Name Well Known But Similar Brand Distinctive Strong Brand Perceived by the Consumer as Unique BRAND DISTINCTION by Timothy D. Ennis
  29. 29. Generic Product CORE BENEFIT Expected Product Augmented Product Potential Product Kotler’s Five Levels of A Product What is a Brand? Products (Commodities) No Difference Except Price Brand Name Well Known But Similar Brand Distinctive Strong Brand Perceived by the Consumer as Unique BRAND DISTINCTION by Timothy D. Ennis OWN Something
  30. 30. What is a Brand?  What Makes the Best Brands? – Source of company wealth for generations – Improves with Age – Develop clearly defined personalities – Develop affection & loyalty of the public – Become parents to sub-brands and brand extension  Brands = Powerful emotional tools
  31. 31. What Is a Brand?  Truly understood brands are the things which patrol the boundary between people and the world outside them.  A brand with an emotional difference can potentially command a premium forever.
  32. 32. Strategic Brand Management Case Groups Definition: Product Service Corporation Brand
  33. 33. Strategic Brand Management Corporation vs Service vs Product vs Brand
  34. 34. Alternative Branding Models Company dominates Brands Company is equal to Brands Brands dominate the Company American Express (cards) BMW (Motorcycles) Colgate (Total toothpaste) Disney (Films) General Electric (appliances) IBM (Technology) L’Oreal (Cosmetics) Sony (Electronics) Holiday Inn (Crowne Plaza) Anheuser Busch = Budweiser Campbell Soup = Godiva Chrsyler = Jeep Estee Lauder = Clinique Kraft = Maxwell House PepsiCo = Mountain Dew Time Warner = Warner Bros 3M = Scotch Tape Marriott = Courtyard Skol (Am Bev) Claridge Hotel (Savoy) Crest (P&G) Healthy Choice (Con-Agra) Hidden Valley Ranch (Clorox) Kleenix (Kimberly-Clark) Marlboro (Philip Morris) MCA Records (Universal Studios) Wranlger (VF Jeans) Kevin Clancy, Copernicus
  35. 35. POWER BRANDS The World's 10 Most Valuable Brands - 2002 VALUE ($billions) 1 COCA-COLA 69.6 2 MICROSOFT 64.1 3 IBM 51.2 4 GE 41.3 5 INTEL 30.9 6 NOKIA 30.0 7 DISNEY 29.3 8 McDONALD'S 26.4 9 MARLBORO 24.2 10 MERCEDES 21.0 Data: Interbrand Corp., J.P. Morgan Chase & Co / Business Week AUGUST 5, 2002 Interbrand’s Assessment is of Brand Power – the fullest possible view of each brand’s strengths and potential as a marketing and financial asset.
  36. 36.  The Successful Brands – Don’t JUST sell products – Communicate Clear Values – Stretch Across a Number of Products – Attached to Consumers/ NOT Products – Individualized Relationships POWER BRANDS
  37. 37.  Allow Consumers to clearly identify and specify products which genuinely offer added value.  Deep respect for the way products fit into consumer’s lives = “core” of success  Consumer Relationship = Loyalty  Social Changes in their favor POWER BRANDS
  38. 38.  RIGHT MIX = Organization Excellence + Marketing Sensitivity + Long-term Commitment  Brand Values Transcend National Cultures  Emphasize Classlessness, Service, Consistency – Coke and Mc Donald’s demonstrate most POWER BRANDS
  39. 39.  Assessing BRAND POWER POWER BRANDS Interbrand BRAND DEPTH BRAND WEIGHT POWER
  40. 40. The influence or dominance that a brand has over its category or market (more than just market share)  Assessing BRAND POWER POWER BRANDS Interbrand BRAND WEIGHT
  41. 41. The stretch or extension that the brand has achieved in the past or is likely to achieve in the future (especially outside its original category)  Assessing BRAND POWER POWER BRANDS Interbrand
  42. 42. The breadth of franchise that the brand has achieved both in terms of age spread, consumer types and international appeal  Assessing BRAND POWER POWER BRANDS Interbrand
  43. 43.  Assessing BRAND POWER POWER BRANDS Interbrand BRAND DEPTH The degree of commitment that the brand has achieved among its customer base and beyond. The proximity, the intimacy and the loyalty felt for the brand.
  44. 44.  Assessing BRAND POWER POWER BRANDS Interbrand BRAND DEPTH BRAND WEIGHT POWER
  45. 45. Power Brand = Master Brand?  Manifestation of Brand Essence  A term that USED TO apply only to overarching family brands (Nestle)  NOW applies to entire companies that rally around a single brand identity – Focus on entire value proposition rather than a single product’s functionality
  46. 46. Branding the Corporation  Brands are not just products but companies: – Ford – IBM – Sony  Why has marketing refocused efforts on the potential of corporate brands?
  47. 47.  Cost of creating and supporting product brands has become prohibitive – $1Bil to develop a brand across US, EC, FE  Increasing retailer power  Traditional brand management not as effective/efficient  Focus moving up the value chain Branding the Corporation
  48. 48. Master Branding the Corporation Enhances Brand…  Clarity – Clear brand priorities  Synergy – Every exposure generates awareness  Leverage – Corporate brand in all Company strategies Brand Relationship Spectrum
  49. 49.  Thus, Benefits of Corporate Branding: – Every marketing dollar benefits each one of a company’s division/products – Attracts and inspires employees, stakeholders and business partners – Supplier and Vendor relationships deeper and longer term – Connects up goodwill generated by operations + adds public support/PR in crisis Branding the Corporation
  50. 50.  Benefits of Corporate Branding: – New product launches/extensions cheaper and quicker – Long Term strategic focus – Financial performance and value creation can be enhanced Branding the Corporation
  51. 51.  What Might be Some of the Difficulties? – Organizations can be extremely complex – Wide variety of audiences make consistent proposition communication difficult – Too many businesses: Easier to build a rep & image when one is known for one product or service Branding the Corporation
  52. 52.  What Might be Some of the Difficulties? – Led from the top. CEOs are difficult to pin down for day-to-day brand management – Business Directors often have finance or operations backgrounds – not marketing Branding the Corporation
  53. 53. Class Examples of Master Brands Master Brands
  54. 54. Branding  Different outcomes result from the marketing of a product or service because of its – brand name – brand element – brand identification – WHAT ELSE?
  55. 55. Brand Equity  Common Denominator to interpret the potential effects and trade offs of various strategies and tactics  Common Denominator for assessing the value of a brand
  56. 56. Brand Equity  Fundamentally, stresses the importance of the role of the brand in marketing strategies.  Marketing effects uniquely attributed to the brand  Represents the ADDED VALUE endowed as a result of past marketing investments.  Bridge between the past and future possibilities
  57. 57. Brand Equity  A set of stored values that consumers associated with a Product/Service.  These associations add value beyond the basic product functions due to past investments in marketing the Brand. Timothy D. Ennis, Ennis Associates, Inc
  58. 58. Brand Equity  How can Brand Equity be created?  How can Brand Equity be measured?  How can Brand Equity be used to expand business opportunities?
  59. 59. Brand Equity  Brand Ingredients: – Brand Name & heritage – Packaging (structure & graphics) & signage – Brand symbols, properties and logos – Perceived quality, reliability & convenience – Defined level of satisfaction – Meaningful (premium) price/value relationship – Purchase & usage experiences – Consumer perceptions, attitude & behaviors – Emotional associations with the product/services Timothy D. Ennis, Ennis Associates, Inc
  60. 60. BRAND GESTALT Brand Equity Physical Product Attributes Quality Uses Brand Personality Logo Visual Appearance Country of Origin User Imagery Tangible Benefits Emotional Benefits Brand Customer Relationship Kevin Clancy, Copernicus modified by Soni Simpson
  61. 61. The Coca-Cola Brand Is…  1800’s Heritage The Real Thing  Americana Red & White Striped Can  Vanilla Coke Sold Everywhere  Authenticity Battles with Pepsi Brand Equity
  62. 62. The Mc Donald’s Brand Is…  The Big Mac Happy Meals  French Fries Red and White Restaurants  Fun For Children Ronald Mc Donald  Golden Arches Value for Your Money Brand Equity
  63. 63.  A synthesis of all elements, physical, aesthetic, rational AND emotional.  End result = – appropriate – differentiated – relevant Brand Equity
  64. 64. Brand Imposing One’s Will On The Consumer Branding OLD SCHOOL THINKING DIPLOMA
  65. 65. “ Pretty much everything today can be seen in relation to a love-respect axis. You can plot any relationship – with a person, with a brand – by whether it’s based on love or based on respect. It used to be that a high respect rating would win. But these days, a high love rating wins. If I don’t love what you’re offering me, I’m not even interested.” - Kevin Roberts, Saatchi and Saatchi Branding
  66. 66. TradeMark Branding Love * Mark Trust-Mark
  67. 67. Those Brands which are particularly well adapted to the environment and which thus, survive and flourish. POWER BRANDS •Attached to Consumers •Deep respect for the way products fit into Consumer’s lives = “Core” of Success
  68. 68. Brand Equity  A set of stored values that consumers associated with a Product/Service.  These associations add value beyond the basic product functions due to past investments in marketing the Brand. Timothy D. Ennis, Ennis Associates, Inc
  69. 69. Brand Value Breakdown 0 20 40 60 80 100 120 Coca- Cola J&J P&G Unilever Amazon INTANGIBLE & Goodwill Net TANGIBLE Assets $US Billions
  70. 70.  Measurable Financial Value  Legal Systems recognize brand value – Most countries now recognize intellectual property is REAL property w/rights of ownership  Trademarks, Patents, Designs, Copyright  Consumer Value Brand Value
  71. 71. Brand Value  Multiple values for a brand  Communicated through every medium from shelf to advertising to editorial to word-of-mouth.  Coca-cola – Bottle shape – Can color – Logo type face – Taste – Youthful messages – FORMULA  Are Brand Values Equal?
  72. 72. Brand Value  Three Tiers of Brand Value – Functional Values – Expressive Values – Central Values Interbrand; The World’s Greatest Brands.
  73. 73. Central Expressive Functional Brand Value Corresponding to Brand Hierarchy Pyramid
  74. 74. Brand Value  Functional Values: – Govern product performance  Coke refreshes its drinker  Volvo gives its driver a safe ride  IBM PC provides quick computing – Don’t differentiate products  Pepsi refreshes  Mercedes is as safe as Volvo  Apple is as quick as IBM – Brand Owner’s “bright ideas” can be instantly copied in every continent Interbrand; The World’s Greatest Brands.
  75. 75. Brand Value  Expressive Values: – Say less about the product & more about the consumer – Reflect and enhance the consumer’s sense of him/herself – Provide a key source of brand differentiation  Marlboro’s - masculine values  Armani’s - status and fashionable values  Apple - creative and human values Interbrand; The World’s Greatest Brands.
  76. 76. Brand Value  Central Values: – Most Enduring – Right to the Core of the Consumer’s Belief System – At their purest = embodied in religious, national or political persuasions – Comparable power = embody mass movements or cultural trends  1960’s Coke “I Like to teach the world to sing”  Today= Nike “Just Do It”, Richard Branson’s Irreverent Virgin Interbrand; The World’s Greatest Brands.
  77. 77. Brand Value Corresponding to Brand Hierarchy Pyramid Central Expressive Functional Very meaningful in differentiating our Brand but very difficult to deliver consistently to our consumers Easy to deliver and explain to consumers but also easy to imitate Interbrand; The World’s Greatest Brands.
  78. 78. Central Expressive Functional Very meaningful in differentiating our Brand but very difficult to deliver consistently to our consumers Easy to deliver and explain to consumers but also easy to imitate Beliefs & Core Values Benefits Features & Attributes Brand Value Corresponding to Brand Hierarchy Pyramid Hierarchy : Timothy D. Ennis, Ennis Associates, Inc
  79. 79. Brand Value: Brand Hierarchy Pyramid Beliefs & Core Values Benefits Features & Attributes The emotional beliefs and values that consumers feel are being addressed by our brand (CENTRAL) The functional and emotional benefits that our product/services provides to the consumer (EXPRESSIVE) Product/Service features and/or attributes that must be addressed (FUNCTIONAL) Very meaningful in differentiating our Brand but very difficult to deliver consistently to our consumers Easy to deliver and explain to consumers but also easy to imitate
  80. 80. Mc Cormick: The Taste You Trust Brand Value: Brand Hierarchy Pyramid CENTRAL VALUE Beliefs and Core Values EXPRESSIVE Benefits FUNCTIONAL Features & Attributes I take pleasure in how the family enjoys the meals I prepare Brand I Trust / Taste You Trust Part of making food my way Makes a meal/dish an eating pleasure Makes prepared meals taste better Brings out the best in foods Let me adjust to make it my own * Can be used with any dish * Adds flavor, Spicy * For everyday use * Has a lot of products I use * Easy to find when shopping * Largest variety of spices, extracts, dry seasonings, and mixes
  81. 81. Brand Hierarchy Pyramid vs Product Level Beliefs & Core Values Benefits Features & Attributes Very meaningful in differentiating our Brand but very difficult to deliver consistently to our consumers Easy to deliver and explain to consumers but also easy to imitate Generic Product CORE BENEFIT Expected Product Augmented Product Potential Product
  82. 82. Brand Value OK…Values are Essential…BUT Are they enough? What is missing??
  83. 83. Brand Value  Values Need to be Harnessed & Honed  The Force – Brand Builder’s Vision – Big Idea – Conviction
  84. 84. Brand Vision To build successful brands while your competitors turn their brands into commodities start with a five- step process Kevin Clancy, Copernicus, Counter Intuitive
  85. 85. Brand Building  Kevin Clancy Copernicus’s 5 Step Process Inspirational Vision Transform- ational Strategy Model-Based Marketing Planning Obsessive Implement- ation Diagnostic Metrics Kevin Clancy, Copernicus, Counter Intuitive
  86. 86. Brand Vision  Brand Vision LIFTS the Brand above the mundane and functional  Appeals to Expressive and Central VALUES  Process creates a bond with the consumer, and hopefully, long-term loyalty
  87. 87. Brand Vision  The First thing you need to do is create a marketing vision to rally your forces. “Where there is no vision, the people perish.” Proverbs 29:18
  88. 88. Brand Vision  “Something supposedly seen by other than normal sight”  “The ability to see something not actually visible”  “A force or power of imagination”  “The experience of having a revelation”  “Something supernaturally revealed as to a prophet”
  89. 89. Brand Vision MUST BE: Exciting, even inspirational, to all of your stakeholders: customers and prospective customers, managers and employees, analysts, reporters – everyone. Kevin Clancy, Copernicus, Counter Intuitive
  90. 90. Brand Vision MUST BE: So big, so bold and so audicious that expressing it – never mind executing it – has a transformational effect. You start to become what you want to be. The dream and the reality fuse. Kevin Clancy, Copernicus, Counter Intuitive i.e. YOU NEED A BIG HAIRY VISION
  91. 91. Brand Vision Checklist  Inspirational & uplifting; it moves people  Exciting; it gets the blood pumping  Aspirational; it is barely attainable  Readable; it is clearly communicated  Unique/special/different  Very specific, not general  Connotes superiority or domination  Bold and brash; it oozes with confidence  Causes people to want to invest in/work for the company or buy the company’s products  Transformational, revolutionary, not evolutionary
  92. 92. Brand Vision Let’s review some published vision statements Assign them a college grade from 0 to 100. Kevin Clancy, Copernicus, Counter Intuitive
  93. 93. Brand Vision A beverage company “We exist to create value for our shareholders on a long-term basis by building a business that enhances the company’s trademarks.” Kevin Clancy, Copernicus, Counter Intuitive Grade = 63
  94. 94. Brand Vision A beverage experience company “To have bigger brand awareness then Coca-Cola.” David Sutton, Zyman Marketing Big Hairy Audacious Goal
  95. 95. Brand Vision A motorcycle company “Yamaha Wo Tsubusa!” Kevin Clancy, Copernicus, Counter Intuitive
  96. 96. Brand Vision A motorcycle company “We will crush, squash, slaughter Yamaha!” Kevin Clancy, Copernicus, Counter Intuitive Grade = 85
  97. 97. Brand Vision A technology company “To eclipse IBM as the #1 technology company in the world.” Kevin Clancy, Copernicus, Counter Intuitive Grade = 91
  98. 98. Brand Vision A gasoline company “We will become the dominant brand in the service station industry and beyond – with the friendliest, fastest, cleanest stations everywhere – one of the most admired brands on the planet.” Kevin Clancy, Copernicus, Counter Intuitive Grade = 96
  99. 99. VISION to ASSET LEVERAGE  Tellis and Golder five factors and rationale as the keys to enduring brand leadership Gerard Tellis & Peter Golder “First to Market, First to Fail? Real Causes of Enduring Market Lendership” MIT Sloan Management Review, 1/1/96 Vision of the Mass Market Managerial Persistence Financial Commit- ment Relentless Innovation Asset Leverage
  100. 100. Brand Building  Kevin Clancy Copernicus’s 5 Step Process Inspirational Vision Transform- ational Strategy Model-Based Marketing Planning Obsessive Implement- ation Diagnostic Metrics Kevin Clancy, Copernicus, Counter Intuitive
  101. 101. Brand Vision MUST BE: So big, so bold and so audicious that expressing it – never mind executing it – has a transformational effect. You start to become what you want to be. The dream and the reality fuse. Kevin Clancy, Copernicus, Counter Intuitive i.e. YOU NEED A BIG HAIRY VISION
  102. 102. Generic Product CORE BENEFIT Expected Product Augmented Product Potential Product Kotler’s Five Levels of A Product What is a Brand? Products (Commodities) No Difference Except Price Brand Name Well Known But Similar Brand Distinctive Strong Brand Perceived by the Consumer as Unique BRAND DISTINCTION by Timothy D. Ennis OWN Something
  103. 103.  Assessing BRAND POWER POWER BRANDS Interbrand BRAND DEPTH BRAND WEIGHT POWER
  104. 104. The stretch or extension that the brand has achieved in the past or is likely to achieve in the future (especially outside its original category)  Assessing BRAND POWER POWER BRANDS Interbrand
  105. 105. POWER COMPANIES The World's 10 Most Valuable Brands - 2002 VALUE ($billions) 1 COCA-COLA 69.6 2 MICROSOFT 64.1 3 IBM 51.2 4 GE 41.3 5 INTEL 30.9 6 NOKIA 30.0 7 DISNEY 29.3 8 McDONALD'S 26.4 9 MARLBORO 24.2 10 MERCEDES 21.0 Data: Interbrand Corp., J.P. Morgan Chase & Co / Business Week AUGUST 5, 2002 GOOD – TO –GREAT CASES Results T +15 yr* 1 Abbott 3.98x 2 Circuit City 18.5x 3 Fannie Mae 7.56x 4 Gillette 7.39x 5 Kimberly-Clark 3.42x 6 Kroger 4.17x 7 Nucor 5.16x 8 Philip Morris 7.06x 9 Pitney Bowes 7.16x 10 Walgreens 7.34x 11 Wells Fargo 3.99x Data: Ratio of cumulative stock retruns relative to the general stock market Jim Collins, Good To Great
  106. 106. Brand Vision HEDGEHOG Concept  The Essential Strategic Difference between the Good-to-Great companies: – Founded their strategies on deep understanding along three key dimensions – Translated that understanding into a simple, crystalline concept that guided all their efforts i.e. YOU NEED A BIG HAIRY VISION Jim Collins, Good To Great
  107. 107. Brand Vision Jim Collins, Good To Great What are you deeply Passionate About What you Can be The Best in the World at What Drives Your Economic Engine A Hedgehog Concept: •Is not a goal to be the best, •not a strategy to be the best, •not an intention to be the best •not a plan to be the best •It is AN UNDERSTANDING of what you CAN be the best at.
  108. 108. Brand Vision What are you deeply Passionate About What you Can be The Best in the World at What Drives Your Economic Engine A Hedgehog Concept “Focusing solely on what you can potentially do better than any other organization is the only path to greatness.” …Equally important they know what they cannot be best at. …It is an understanding Jim Collins, Good To Great BHAG
  109. 109. Brand Vision What are you deeply Passionate About What you Can be The Best in the World at What Drives Your Economic Engine A Hedgehog Concept “Good to Great Companies know they should only do those things that they can get passionate about.” “They asked the right questions.” Jim Collins, Good To Great BHAG
  110. 110. Brand Vision What are you deeply Passionate About What you Can be The Best in the World at What Drives Your Economic Engine BHAG Jim Collins, Good To Great BIG HAIRY VISIONS & GOALS • Bad BHAGs set with bravado, • Good BHAGS set with understanding
  111. 111. Branding How do we measure one brand’s performance vs another brand?
  112. 112. Branding  Brand Share of Market: – Measuring a brand’s percent of sales in a market – Can be measured nationally, regionally and at retailers – Data captured via  Scanner data (IRI, Nielsen)  Industry trends A  nnual reports
  113. 113. Branding  Measuring Brand Share of Market Unit $$ Unit $$ Sales Sales Share Share National 120 $270 100% 100% Brand A 5 15 4.2% 5.6% Brand B 15 15 12.5% 5.6% Brand C 3 7 2.5% 2.6%
  114. 114. Branding  Measuring Brand Share of Market Brand Sales Category Sales = Brand Share
  115. 115. Branding  Are ALL Brands Created Equally?  How Does Brand Usage Compare to Category or Competitive Usage?  Are Brands Equally Strong in Different Regions?  Measuring Brand Development  Using Brand Share Metrics
  116. 116. Brand Management  As much ART as SCIENCE  As much SCIENCE as ART  Achieved by combo of – Specialist talent – Long term vision – Analytic wizardry
  117. 117. What is Brand Management?  Entrepreneurs are building brands (Ben & Jerry’s, Yahoo…)  Creating a whole new brand – Riskiest – Most lucrative  Six to Seven of Ten brands launched fail
  118. 118. What is Brand Management?  Majority of Brand Builders main task – take existing brand legacy – adapt brands to suit the requirements of more sophisticated consumers.
  119. 119. What is Brand Management?  Components of Main Brand Builders task – Embrace the increasing possibilities for communicating brand values – Acknowledge growing financial pressures on brands to make a return. – Issue: Agencies are communicators..some given responsibility to modify core brand values…brand owners may run into difficulties with this later..
  120. 120. What is Brand Management?  Marketing as Brand Management’s responsibility is to build long-term profitable growth for the company’s brands.
  121. 121. What is Brand Management?  To accomplish this, marketing must: – Deliver sustained value to consumers – Enhance brand equity by keeping their brands relevant, fresh and contemporary – Build consumer loyalty towards their brand
  122. 122. What is a Brand Management?  Brand Building Begins By – Understanding & anticipating the needs and desires of the consumer – Understanding the key attributes of the product(s)  Our Mission is to DISCOVER (rather than Invent) the brand’s CORE VALUES and abide by them.
  123. 123. What is Brand Management?  Brand = Primitive God – If we keep it’s laws – And pay regularly the tributes due (mainly advertising), fortune will smile on us – otherwise, disaster.
  124. 124. What is Brand Management? “You have to maintain and replenish a brand over time or it will die”
  125. 125. Brand Vision and Essence BRAND = Mindset EQUITY = Roots ESSENCE = Brand’s Soul VISION = Brand’s DNA
  126. 126. What is Brand Management? Functional Excellence in Support of the Brand Primary Source of Differentiation • Product/service innovation and communication Purpose of the Brand • Create or reinforce product distinctiveness Firmwide Leadership in Stewarding the Brand Primary Source of Differentiation • Customer experience, in addition to innovation and communication Purpose of the Brand • Provide clear set of values along which to align all enterprise activities and investments Corporate Executive Board
  127. 127. What is Brand Management? Functional Excellence in Support of the Brand Marketers Responsibilities • Deduce customer interests from market research data • Develop and refine brand strategy • Control advertising and promotion planning and execution •Develop new line extensions Firmwide Leadership in Stewarding the Brand Marketers Responsibilities • Generate customer insight from all points of customer contact •Develop & Refine brand values, and translate into expectations for each function and role •Influence customer experience across all touch-points, from communication through transaction and service •Leverage brand into new, relevant industries, marketplaces or customer segments Corporate Executive Board
  128. 128. What is Brand Management? Functional Excellence in Support of the Brand Marketers Responsibilities • Defend marketing budget •Base decisions primarily on marketing judgement •Determine success through intermediate measures (awareness, recall, brand equity) Brand Architecture • Multiple, unrelated brands Firmwide Leadership in Stewarding the Brand Marketers Responsibilities • Champion shareholder value • Base decisions on marketing judgement supported by comprehensive customer database and/or modeling of all key inputs and outputs •Determine success using a dashboard of selected intermediate and bottom- line measures Brand Architecture • Single brand or few, interrelated brands
  129. 129. What is Brand Management? Functional Excellence in Support of the Brand Locus of Brand Ownership • Brand Managers Firmwide Leadership in Stewarding the Brand Locus of Brand Ownership • Chief Marketing Officer Corporate Executive Board
  130. 130. What is Brand Management?  Brand Management is reliant on entire corporation and agency teams  In Operationalizing the brand, the highest priority is to enlist the support of each member of the team
  131. 131. What is Brand Management? Innovative Analysts Archeologists Sociologists Politicians General Managers Templar Knights of Equity Evangelists Brand Stewards Brand Champions
  132. 132. Parallel Path Strategic Growth Model (Soni’s Standard Operating Procedure) Strategic Brand Management
  133. 133. Guiding Focused Strategic Growth Parallel Path Process PATH 2: We’ve got a Business to Run PATH 1: Strategic Plan for Long Term Explosive Growth $$ Building Brands NOT Growing Products
  134. 134. Interview ALL key internal players, all vendors, & buyers/brokers Review & analyze business and consumer trends Read all research on-hand & obtained Path 1: Strat Plan for High Growth Guiding Focused Strategic Growth Parallel Path Process #1 Full Business Immersion#1
  135. 135. Path 1: Strat Plan for High Growth Guiding Focused Strategic Growth Parallel Path Process Brand Essence/Consumer Insight#2 Vision >>Objectives >>Strategies#3 Full Business Immersion#1 SET STRATEGIC PLAN#5 Full Team Brainstormings#4
  136. 136. Short Term: Running The Business ASK & Listen Focus on Immediate Business Issues Ensure All Priorities & Deadlines are met Guiding Focused Strategic Growth Parallel Path Process Work Current Plan#1
  137. 137. Work Current Plan#1 Path 2: ST Running The Business Guiding Focused Strategic Growth Parallel Path Process Facts vs Folklore#2 Full Team Brainstormings#4 Strat & Tactic Successes/Failures#3 ADJUST SHORT TERM PLAN#5
  138. 138. Work Current PlanFull Business Immersion Facts vs FolkloreBrand Essence/Consumer Insight #1 #2 Strat & Tactic Successes/FailuresVision >>Objectives >>Strategies ADJUST SHORT TERM PLAN #3 Full Team Brainstorm SET STRATEGIC PLAN #4 #5 Path 1: Strat Plan for High Growth Path 2: ST Running The Business Guiding Focused Strategic Growth Parallel Path Process $$
  139. 139. Work Current PlanFull Business Immersion Facts vs FolkloreBrand Essence/Consumer Insight #1 #2 Strat & Tactic Successes/FailuresVision >>Objectives >>Strategies ADJUST SHORT TERM PLAN #3 Full Team Brainstorm SET STRATEGIC PLAN #4 #5 Path 1: Strat Plan for High Growth Path 2: ST Running The Business Guiding Focused Strategic Growth Parallel Path Process $$ Building Brands NOT Growing Products
  140. 140. Strategic Brand Management In Class Exercises: Self Positioning Case Study Product and Brand Hierarchy Exercise
  141. 141. Strategic Brand Management SELF POSITIONING Develop your own personal positioning statement to share with your group this week. Have your group provide you feedback this week. Define your target audience in the process: what they need to know and why? What makes you unique and why? Have in writing to turn in and share next week.
  142. 142. What is a Product?  Kotler’s Five Levels to a Product: Generic Product CORE BENEFIT Expected Product Augmented Product Potential Product The Fundamental Need or Want that consumers satisfy by consuming the product or service Generic Product Basic Version of the product containing only those elements absolutely necessary to function. No distinguishing features. Expected Product Attributes and Characteristics that buyers normally expect and agree to when they purchase a product Augmented Product Additional product attributes, benefits, or related services that distinguish the product from competitors Potential Product Additional Product attributes, benefits, or related services that distinguish the product from competitors
  143. 143. PRODUCT LEVEL LEVEL Television or Juice Drink BRAND Name/Positioning Potential Product Augmented Product Expected Product Generic Product Core Benefit
  144. 144. Brand Value: Brand Hierarchy Pyramid Beliefs & Core Values Benefits Features & Attributes The emotional beliefs and values that consumers feel are being addressed by our brand (CENTRAL) The functional and emotional benefits that our product/services provides to the consumer (EXPRESSIVE) Product/Service features and/or attributes that must be addressed (FUNCTIONAL) Very meaningful in differentiating our Brand but very difficult to deliver consistently to our consumers Easy to deliver and explain to consumers but also easy to imitate
  145. 145. BRAND HIERARCHY LEVEL Television or Juice Drink BRAND Name/Positioning Central Beliefs and Core Values Expressive Benefits Functional Features and Attributes
  146. 146. Strategic Brand Management Did your output change with the Brand Hierarchy vs the Product Level approach? What about the Consumer? How did you create this brand without the Consumer Insights? What about your BHV?

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