Setting Product Strategy and Creating Brand Equity discusses product strategy, brand equity, and branding. It covers distinguishing products, evaluating brands based on branding and experience, protecting brands through trademarks and patents. It also discusses the roles of brands in creating differentiation, applying branding to different entities, and the scope and advantages of strong brands. Key aspects covered include building brand equity through brand elements, marketing activities, and secondary associations. Various models of brand equity and resonance are presented.

1. Setting Product Strategy
and
Creating Brand Equity

2.  Distinguish the good of one producer
from those of another
Brand Equity

3.  The consumers evaluate the product based on
• how it is branded ?
• through past experience
• need satisfaction
• The brand name can be protected through registered trademarks
• Manufacturing can be protected through registered patents
• Packaging can be protected through copyrights and proprietary designs
The role of brands

4.  Brand differences can be create through
• Continuous innovation
• Competitive advantage
• Marketer can apply branding to
• A physical good
• A service
• A store
• A person
• A place
• An organization
• An idea
The Scope of Branding

5.  Improved perception of product performance
 Less vulnerability to competitive marketing actions
 Less vulnerability to marketing crises
 Larger margins
 More inelastic consumer response to price increases
 More elastic consumer response to price decreases
Marketing Advantages of Strong Brand

6.  Greater trade cooperation and support
 Increased marketing communications effectiveness
 Possible licensing opportunities
 Improved employee recruiting and retention
 Greater financial market returns
Marketing Advantages of Strong Brand

7.  Customer Based Brand Equity
• Positive
• Negative
 Arises from differences in consumer response
 Differences in response are a result of consumer’s brand knowledge
 It reflected in perceptions, preferences, and behavior

8. • Brand asset valuator model:
Energized differentiation:
Measures the degree to which a brand is seen as different from other.
Relevance:
Measures the appropriateness of brand’s appeal.
Esteem:
Measures of quality and loyalty, how well the brand is regarded
and respected.
Knowledge:
How aware and familiar consumers are with the brand.
Brand equity models

9. • Strong and new brands show higher level of differentiation and energy
than relevance, where as both esteem and knowledge are lower still.
leadership brands show high levels on all stages.
• Example:
Sensodyne tooth paste give demonstration for its product which shows
high differentiation but less esteem and knowledge.
While Colgate is leading brand in toothpaste which is higher on all stages.

10. • The brand dynamic pyramid shows the number of consumers who
have reached each level.
• Presence: active familiarity based on past trial.
• Relevance: relevance on consumer’s need, in the right price range.
• Performance: belief to deliver acceptable product.
• Advantage: belief that brand has emotional rational advantage.
• Bonding: rational and emotional attachment to the brand.
Brands model

11. • Resonance is the intensity of customer’s psychological bond with the
brand.
• Stages of brand development.
• Identity
• Meaning
• Response
• Relationship
Brand resonance model
It is callled six brand building blocks.

12. • Brand salience: how often and how easily
customers think of the brand under various
consumption situation.
• Brand performance: how well the product
meet customer’s functional needs.
• Brand imagery: the way in which the
brand attempts to meet customer’s
psychological and social needs.
• Brand judgments: focus on customer’s
own personal opinions and evaluations.
• Brand feelings: customer’s emotional
responses and reactions.
• Brand resonance: relationship customers
have with the brand and extent to which
they feel they’re “in sync”.

13. BUILDING BRAND EQUITY
• BRAND EQUITY DRIVERS:
1) The initial choices for the brand elements or identifies making up the
brand:
• brand name
• URLs
• Logos
• Symbols
• Characters
• Slogans
• Jingle
E.g.: AIRTEL recently
changed its logo so that “a”
represents AIR and the
deeper red color conveys
positive meaning.

14. • E.g.: Virgin mobile uses edgy and humorous
advertisements that depicts pranks and mischievous acts
by youngsters.
2) The product and service and all accompanying marketing
activities and supporting marketing programs:

15. • Person
• Place
• Thing
E.g.: OLX using Kapil Sharma, as a brand endorser in its advertisements.
3) Other associations indirectly transferred to
the brand by linking it to some other entity:

16. • 1) CHOOSING BRAND ELEMENTS:
BRAND ELEMENTS are devices which can be trademarked that identify
and differentiate the brand.
E.g.: Nike has a distinctive SWOOSH logo and empowering JUST DO IT
slogan and Nike name from Greek winged goddess of victory.
WAYS TO BUILD BRAND EQUITY:

17. BRAND ELEMENT CHOICE CRITERIA:
BRAND BUILDING DEFENSIVE
Memorable
Meaningful
Likable Transferable Protectable
Adaptable

18. • E.g.: Life Insurance Corporation of India uses the symbols of
the flame of an enveloped by two hands folded in a Namaste,
symbolizing PROTECTION & SECURITY.
1) Developing Brand Elements:

19. • Brand contacts and touch points: word of mouth, online experience, etc.
• BRAND CONTACT is any information bearing experience, positive or
negative, a customer has with a brand, its product category or its market.
• INTEGRATED MARKETING is mixing and matching marketing
activities to maximize their individual and collective efforts.
E.g.: Johnson & Johnson
2) DESIGNING HOLISTIC MARKETING ACTIVITIES:

20. • It links the brand to sources like company itself, Characters,
channels of distribution, Events, Countries and Other party
sources.
• INTERNAL BRANDING consists of activities and processes
that help, inform and inspire employees about brands. Its
principles are:
1. CHOOSE THE RIGHT MOMENT
2. LINK INTERNAL AND EXTERNAL MARKETING
3. BRING THE BRAND ALIVE FOR EMPLOYEES
3)LEVERAGING SECONDARY ASSOCIATIONS:

21. SECONDARY SOURCES OF BRAND KNOWLEDGE

22. • BRAND COMMUNITIES is a specialized community of
consumers and employees whose identification and
activities focus around the brand.
E.g.: The Harley-
Davidson Owner’s
Group is a company
sponsored and
facilitated brand
communities.

23. • Brand Value Chain Model
Measuring Brand Equity

24. • Brand Audit is a consumer-focused series of procedures to
assess health of brand, know its sources of brand equity, to
improve and leverage its equity.
• Brand-tracking studies collect data from consumers to
provide information about performance of brands and
marketing programs.

25. Brand Valuation

26. Managing Brand Equity

27.  Brand Reinforcement :- Brand equity can be
reinforced by consistently conveying brand’s
meaning by :-
(a) what products it represents, its core
benefits, needs it satisfies (b) how brand makes
products superior, strong, favorable and unique.

28.  Brand Revitalization : Keeping up with the
changes in consumer tastes and preferences.
1)
2) 3)

29. Devising a branding strategy
Develop new brand
elements
Apply Existing brand
elements
Use combination of
old and new brand
elements

30.  Brand Extension: Uses Established brand to introduce a new brand
 Sub Brand: Combine new brand with existing brand
 Parent Brand: Existing brand that give birth to a brand extension or sub-
brand
 Family Brand:Parent brand that is associated with multiple products
through extensions
 Line extension: parent brand covers a new product within a product
categories it currently serves
e.g. coca-cola diet , Bisleri, colgate etc.
 Category extension : Use existing brand name to different product
category
e.g. colgate toothbrush, Godrej, ITC etc.
 Brand line: coverage of all products
 Brand mix: set of all brand lines made available to buyers
Branding Terms

31.  Line extension: parent brand covers a new product within a
product categories it currently serves
e.g. coca-cola diet , Bisleri, colgate etc.
 Category extension : Use existing brand name to different
product category
e.g. colgate toothbrush, Godrej, ITC etc.
 Brand line: coverage of all products
 Brand mix: set of all brand lines made available to buyers

32. Branding Decisions
•e.g. Procter & Gamble’s
different brands such as
vicks,pantene,head &
shoulders
Individual or separate
family brand name
•e.g. Tata,LG,Samsung uses
corporate brand names
Corporate umbrella or
company brand name
•e.g. Honda,sony uses sub
brands for their productsSub brand name

33. • Meaning: It is a set of all brands and brand lines a firm offers for sale
in a particular category or market.
Brand Portfolios
Flankers:
Fighter brand
e.g. P & G’s
baby
products
Cash Cows:
capitalizing
on existing
brand equity
e.g. Gillette
Low end entry
level: traffic
builders
e.g.BMW car
High-end
prestige:
add prestige
and credibility
to portfolio
e.g. sport cars

34. • Advantages to Brand Extensions:
 Acceptance of new product
 Positive Feedback Effect
• Disadvantages to Brand Extensions:
 Harmful to parent brand image
 Loss of reliability
 Brand Dillution
Brand extensions

35. • When brand equity exists
• When strong basis fitted
• When extension contributes to overall brand equity
• When marketing programs enhance equity
When brand extensions appropriate?

36. • Meaning: The sum of life time values of customers.
 Acquisition
 Retention
 Add-on spending
Customer Equity

37. • Customer Equity:
 Focuses on bottom line financial values
 Overlooks the value of brands
• Brand Equity:
 Emphasis on creating, leveraging brand awareness
 Ignores to develop detailed customer analyses
Brand v/s customer Equity

38. Setting Product Strategy

39. • Product can be anything that can be offered to a
market to satisfy a want.
• It can be goods, services, events, information, ideas
etc.
Product Characteristics and Classification

40. Product Levels :
The customer value hierarchy

41. These are the different level of products :
 Core benefit : The service
benefit customer is really
buying.
Ex: Hotel guest is buying rest
and sleep.
 Basic Product : The marketer
must turn the core benefit
into a basic product.
Ex: hotel room includes a bed,
bathroom etc facilities.
 Expected product : A set of
attributes and conditions
buyers normally expect
while purchasing product.
Ex: hotel guest expect clean
bed, fresh towel etc.
 Augmented Product :
something that exceeds
customer expectations.
• Brand positioning takes
place under this segment.
Potential product:
which encompasses all the
augmentations and
transformations the
product offering might be
in future.

42. Product Classifications :
DURABILITY AND
TANGIBILITY
 Nondurable goods: Which
are tangible goods
consumed in one or a few
uses.
Such as shampoo, drinks etc.
 Durable goods: which are
tangible goods that survive
many uses.
Such as cloths, machine tools .
 Service: These are intangible,
inseparable & perishable
products.
CONSUMER-GOODS
CLASSIFICATION
 Convenience goods:
purchased frequently,
immediately and with
minimal effort.
Ex: soft drink, soaps
 Staples
 Impulse
 emergency

43.  Shopping goods :these are
the goods the consumer
characteristically
compares on basis of
quality, price and style.
Ex: furniture, clothing
 Specialty goods: it has
unique characteristic
which make buyer to
purchase it.
Ex: Mercedes car
 Unsought goods: these are
the goods which
consumer dose not know
about normally think of
buying. Ex: life
insurance policy
 INDUSTRIAL-GOODS
CLASSIFICATION
 Material and parts : goods
that enter the
manufacture’s product
completely.
 Raw materials
 Manufactured materials
and parts
 Capital items: these are long
lasting goods that
facilitate developing or
managing the finished
product.
 Installation
 equipment

44.  Supply :
Short term goods and services that facilitate developing or managing
the finished product.
 Maintenance and repair items :- paint, nails, brooms
 Operating supplies:- lubricants, coal, writing paper, pencils
 Business services:
 Maintenance and repair services:- window cleaning, copier repair
 Business advisory services:- legal, management consulting , advertising.
Supplies and business services:

45. • To be branded, Products must be differentiated.
• Differentiation can be refer as variation in products by
variation company can carved out distinct identities in their
categories.
• For example; TATA steel , P & G
• Product differentiation includes differentiation by form,
features, customization, performance quality, conformance
quality, durability, reliability, repairability, and style.
Product and Service Differentiation

46. Product Differentiation
• Form: Differentiation in form includes the size, shape, or physical
structure of the product.
• Features: Most products can be offered with varying features that
supplement their basic function.
• “feature fatigue”

47. Customization:
Mass Customization is the
ability of a company to meet each customer’s
requirements.
Performance Quality:
It is the level at which the
product’s primary characteristics operate.

48. • Conformance Quality:
Buyers expect a high conformance quality,
the degree to which all produced units are identical
and meet promised specification.
Low conformance disappointment to buyers
• Durability:
• A measure of the product’s expected operating
life under natural or stressful conditions.

49. • Reliability:
It is a measure of the product will not malfunction
or fail within a specific period. E.G. Nokia cell phones &
china cell phones
• Reparability:
It measures the ease of fixing a product when it
malfunctions or fails. E.G. warranties 6 months on mobile
phones.
• Style: It describes the product’s look and feel to the buyer
to buy. E.G. Colgate toothpaste

50. Service Differentiation
Service quality often acts as the key differentiator.
• Ordering Ease: It refers to how easy it is for the
customer to place an order with the company. For
example ; online shopping order.
• Delivery: It refers to how well the product or service
is bought to the customer.It includes speed,
accuracy, and care throughout the process.

51. Installation: It refers to the work done to make a
product operational in its planned location. E.G.
Purchasing of A.C.
Customer Training: It helps the customer’s employees
use the vendor’s equipment properly and efficiently.
E.G. Expensive X-ray equipment in hospitals.
Customer Consulting: It includes data, information
system, and advice service the seller offers to buyers.

52. Maintenance and Repair: This helps customers
keep purchased in good working order. For
example; HP offer online technical support – “e-
support”
Returns: A nuisance to customers, manufactures,
retailers and distributors alike, product returns
are also an unavoidable reality of doing business,
especially with online purchases.
 Controllable returns
Uncontrollable returns

53. Design
• Design is the totality of features that affect hoe a product looks, feels,
and functions to a customer.
• The designer must figure out hoe much to invest in form, feature
development, performance, conformance etc.
• Well-designed features an help differentiate a product from others in
the market.

54. • A bad design can also ruin a product’s prospect.
• Design thinking: It involves three phases.
Observation
Ideation
Implementation

55. Product & Brand Relationship

56. • Levels of product hierarchy are as follows:-
1) Need family
2) Product family
3) Product class
4) Product line
5) Product type
6) Item
Product Hierarchy

57. • Product system is a group of diverse but related items that functions in a
compatible manner.
• Product mix is the set of all the products and items a particular seller offers
for sale.
• Following are the dimensions of product mix:-
1) Width
2) Length
3) Depth
4) Consistency
Product System & Product Mix

58. • Following are things that product manager need to know
for each item in the product line:-
1) Sales & Profit
2) Market Profile
3) Product map
• Product line analysis provides the information for
following two areas:-
1) Product line length
2) Product mix pricing
Product Line Analysis

59. • A company can lengthens its product line in two ways:-
• Line stretching
• Line filling
• Following are the ways for line stretching
• Down-Market Stretch
• Up-Market Stretch
• Two-Way stretch
Product Line Length

60. • Modernization approach can be adopted by following ways:-
• Piecemeal approach.
• Focus on either end of the product.
• Use of sale and cost analysis
• Focusing on core brand growth
• Concentrating on resources for the biggest & most established
brands
Line Modernization, Featuring & Pruning

61. Product Mix Pricing
• In product mix pricing, the firm searches for a set of prices that
maximizes profits on the total mix. Situations for product mix pricing-

62. 1) Product Line Pricing:
For products with various quality levels.
Eg: Computers- basic models, business models and premium high graphic or gaming models.
2) Optional-Feature Pricing:
For products with optional features.
Eg: Cars- power windows, power steering , etc.
3) Captive-Product Pricing:
For products which require ancillary or captive products.
Eg: Razor-Blades
4) Two-Part Pricing:
For service firms consisting of a fixed fee plus a variable usage fee.
Eg: Amusement Parks- Admission fee plus fee for rides over a certain minimum.

63. 5) By-Product Pricing:
By-product is something which is produced as a result of
producing the main product.
Eg: Petroleum Products
6) Product-Bundling Pricing:
For products sold in bundles.
Pure Bundling- Product offered only as bundle.
Eg: Fixed Thali
Mixed Bundling- Goods sold both individually and in bundles.
Eg: Shampoo & Conditioner

64. Co-Branding and Ingredient Branding
Co-Branding:
Combining products with products from other companies in various ways.
Also called dual branding or brand bundling.
 Same company co-branding: Gillette Mach 3 Turbo & Gillette Shaving Gel
 Joint-Venture co-branding: Citibank & Jet Airways
 Retail co-branding: Pizza Hut & KFC
Ingredient Branding:
It creates brand equity for materials, components, or parts that are
necessarily contained within other branded products.
Eg: Intel Processors & Laptops of Dell, Lenovo, etc.

65. Packaging, Labelling, Warranties &
Guarantees
Packaging
Includes activities related to designing & producing container for a
product.
Layers of Packaging:
 Primary Package- Eg: Bottle of a perfume
 Secondary Package- Eg: Cardboard Box
 Shipping Package- Eg: Corrugated Box

66. Factors contributing to the growing use of packaging-
i) Self Service
ii) Consumer Affluence
iii) Company and Brand Image
iv) Innovation Opportunity
Labelling:
A simple attached tag or an elaborately designed graphic that is part of the
package.
Functions of label:
i) Identify product/brand
ii) Describe the product
iii) Promote the product

67. Warranties & Guarantees
Warranty-
Formal statement of expected product performance by the manufacturer
Legally enforceable
Expressed or implied
Guarantee-
Reduce the buyer’s perceived risk
Suggests that product is of high quality
Product’s service performance are dependable