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Umbrella branding


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Umbrella Branding in marketing concepts.

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Umbrella branding

  1. 1. Umbrella Branding
  2. 2. Synopsis  Definition  Purpose  Impact  Theories  Examples  Successful Umbrella branding  Umbrella brand failure  Popular Usage  Conclusion
  3. 3. Definition  Is also known as family branding  represents a marketing practice which involves selling many related products under a single brand name .  It involves creating huge brand equity for a single brand
  4. 4. Purpose To enhance marketability of products:  It follows the psychological concept that any product that carriers the same brand name is produced using the same high standards of quality.  So a brand may have 10 product lines, but the trust on that brand, leverages the attributes of all the 10 product lines
  5. 5. Impact Factors that may determine the impact of umbrella branding include:  The degree of commonality among the products falling under the corporate umbrella E.g. Whether the products may act as substitutes for each other.  The brand equity of a corporation E.g. Whether the brand is known in its product market.
  6. 6. Theories To explain a consumer's decisions and judgements during product purchasing that cause umbrella branding to be a successful marketing strategy. 1. Categorization theory 2. Schema congruity theory 3. Confirmation bias
  7. 7. Categorization theory  Based upon the notion that consumers tend to categorize products by associating them to brands and their past experiences with those particular brands (stored in their category memory) in order to evade the initial confusion caused by the extensive choice of products.  E.g.: if Apple Inc. would develop and sell a new version of a Macbook, consumers would deem it more reliable and potentially of superior quality rather than if Apple would produce a new beverage due to Apple's past product line.
  8. 8. Schema congruity theory  Schemas are a human's personal cognitive representations of the environment that guide their perceptions, thoughts and actions.  Schemas go through constant changes as a human experiences and learns new information.  The schema congruity theory places more emphasis on the consumer's past experiences with the brand rather than the general brand equity, which is influenced by the surrounding environment.
  9. 9. Confirmation bias  Form of statistical bias, describing the tendency to seek for or interpret evidence in ways that support one's existing beliefs.  After a consumer creates a preference of one brand over others, any additional feature that may be common between various brands will most likely only strengthen the consumer's pre-existing preference, causing them to disregard other brands.  Hence, a positive brand equity may not be as influential if a consumer already has a pre-existing brand preference.
  10. 10. Example: Successful Umbrella branding Apple Inc.  Apple Inc. is an American multinational technology corporation that develops and sells a range of consumer electronic goods and services.  The original brand of the Apple company has been the Mac computers, and hence it is at the apex of the Umbrella. But, then the umbrella divides further into the Ipad, Iphone and others to cover all the other products within the umbrella.  The rising brand image of the parent brand due to increase in number of products, and assuming that it maintains the quality, can represent a powerful competitive advantage especially in competitive markets.  Another great advantage of this marketing practice is that once a well-known brand wants to introduce another product, there will be no cost required for brand creation. Therefore, new product launch becomes easier and cheaper as it can find already available recognition and market set up.
  11. 11. Example: Umbrella brand failure Nestle  Maggi, the flagship product of Nestle, recently bombed across India and several other countries because of its high lead content. What has happened is, besides Maggi, many other brands of Nestle has taken a hit.  As Nestle is an umbrella brand, there was negativity against all individual products of the brand. It can affect all the products together.  Cannibalisation (reduction in sales volume due to the introduction of a new product by the same company) may result when related products are introduced under the same corporate brand as internal product competition will lead to consumers choosing between products from the same brand, stunting future investment into product creation of the same product line under the corporate umbrella
  12. 12. Popular Usage
  13. 13. Conclusion Umbrella branding is a concept of “All for one, and one for all”. Attracting new customers and getting higher sales volume requires the addition of new customers as well as the increase in the repeat purchase rate. The best way to increase the bottom line is to increase the brand loyalty amongst customers.