Keller SBM3 01

1/14/2018
Learning Objectives
Chapter-1
 Define ―brand,‖ state how brand differs from a
BRANDS AND BRAND product, and explain what brand equity is
MANAGEMENT  Summarize why brands are important
 Explain how branding applies to virtually everything
 Describe the main branding challenges and
Prof. Mizanur Rahman opportunities
MBA (Canada), PhD (Dhaka)
Department of Marketing  Identify the steps in the strategic brand

University of Dhaka
management process
© 2017 Prentice Hall 1-1 © 2017 Prentice Hall 1-2
What Is A Brand? What Is A Brand?
 ―A brand is a name, term, sign, symbol, or  ―A brand is the promise, the big
Improved
design or a combination of them, intended idea, the expectations that reside in

Generic
to identify the goods or services of one each customer‘s mind about a

seller or group of sellers and to differentiate product, service, or company.‖---Alina
them from those of competition.‖---AMA ??? Wheeler
 ―A brand is something that has actually  ―A brand is the summation of all

Improved
created a certain amount of awareness, perceptions, experiences and beliefs

Best
reputation, prominence, and so on in the associated with a product, service, or

marketplace.‖ entity that make it distinct.‖
Why Is Brand So Important? Why Is Brand So Important?
As perceptions of all tangible Brands can have POWER…

and intangible elements,
brands have… Coca-Cola Is it more than cola beans, corn sweetener, spices,
and food coloring mixed together?
Is it more than a beverage?
Coors Is it more than hops, malted barley,

…the ability to Light mushroom, and water?
…the power that can
transcend the attributes capture attention and Starbucks Is it more than coffee?
and characteristics of loyalty far above
products others USA Is it more than 50 states united?
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Are You A Brand? Brand Elements

 Different components that identify and
differentiate a brand
Can be based on people, places, things, and
Yes!! or No!!

abstract images
You all are a brand by all of your individual rights
and identities • Name
• Logo and symbol
• Package design
• Slogan
• Other Characteristic
Brand Elements Create Brands with an Identity That…
 Brand name is that part of a brand which

can be vocalized or utterable. …generates customer loyalty and business
 Brand mark is that part or element of a
brand which can be recognized but is not (a) Compete in price or
utterable, such as symbol, design, or fundamental superiority
distinctive coloring or lettering. Options for a brand
(b) Construct an identity
 Trademark is that part or element of a with meaning
brand which is registered & protected by
law and which gives the seller exclusive
rights to use it in perpetuity
What Defines a Commodity Commodity Branding Strategies
Basic No
Perfect Brand The
Performance Differences Company
Build an Create a Add Value
Substitution Emotional Customer Through
Needs in Brands Not The
Connection Community Services
Product
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Brands versus Products Brands versus Products

Product Brand Product Brand
Anything we can offer to a More than a product because it A physical entity that lives in A perceptual entity that lives in
market for attention, has dimensions that differentiate the real world the minds of consumers
acquisition, use, or it in some way from other
consumption that might products designed to satisfy the Provides only functional Provides functional as well as
satisfy a need or want same need value physiological (social, emotional,
and epistemic), and situational
values
All products are not brands All brands are products
Can be copied by competitors Is unique
Comes and goes with time Is timeless???
Five Levels of Meaning for a Product Brands Conveying Six Meanings
 Attributes– characteristics and features

 Core benefit level
 Benefits– functional and emotional
 Generic product level
 Values– performance, safety & prestige
 Expected product level
 Culture– Mercedes-organized, efficient, high quality
 Augmented product level
 Personality– Fanta/Virginia Slim: female personality
 Potential product level
 Users– the kind of consumer using it
Every Brand Has A Personality Evolution From USP to HSP

Nike Addidas Bata
Beautiful Greek Old Physical
product  USP = Unique Selling Proposition (50‘s)
Feminine Masculine Orthodox
Emotional
Strong Strong Bore attachment and  ESP = Emotional Selling Proposition (60‘s)
label consumption
Smart Stylish Formal Corporate
branding
 OSP = Organizational Selling Proposition (80‘s)
Ambitious Authoritative Introvert
Cool Powerful Unsporty More than physical
dimensions
 BSP = Brand Selling Proposition (90‘s)
Sexy Dominating Weak Personalization;
ownership by  MSP= Me Selling Proposition (2000‘s)
Extrovert Stable Simple consumers
Energetic Commanding Conservative Multisensory brand;

synergy
 HSP =Holistic Selling Proposition (After 2000‘s)
Young Modern Trustworthy
Lively Bold Caring http://www.slideshare.net/paulsjr/brief-history-of-branding
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What Is Branding? Branding Pitfalls or Flaws
 Pitfall No. 1: A brand is  A brand is defined only by

something a firm owns customers
 The act of transforming a product into customer
 Pitfall No. 2: Brands  Proactive brand management is
satisfying value-added propositions to create take care of themselves required
preferences in one‘s favor and against rivals
 Pitfall No. 3: Focus on  Manage touch points; target
– Shaping the perception of a product or company in society brand awareness instead right customers and
of brand relevance stakeholders
– Everything a marketer does to its offer so that customers
can favorably discriminate a brand  Pitfall No. 4: Don‘t base  Gain customer input and
on internal image of determine current brand image
– About making an emotional connection.---Alina Wheeler
brand and take needful measures
 Pitfall No. 5: Don‘t let  Company should determine its
outsiders do firm‘s job own brand image
Major Enemies of Brands Types of Failure of Brands
 Under nourishing  Parity Brands– offer only similar values
 Excessive milking  Inferior Brands– offer lesser value or suffering

competitive disadvantage
 Excessive line extensions
 Mismatch Brands– offer value not in the line
 Excessive repositioning with customer needs
 Excessive promotions  Over-priced Brands– offer superior value but at
a higher sacrifice
Achieving Brand Power Achieving Brand Power
Brand Differentiation
Brand + Brand + Brand =
Differentiation Relevance Equity The characteristics and perceptions that are
perceived to be different against alternatives
Brand Power
is a function of Differentiation, Relevance, and Equity
Differentiation buys trial
BP=f(D,R,BE)
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Achieving Brand Power Achieving Brand Power
Brand Relevance
Brand Equity
The degree to which the brand is applicable to, or
makes a connection with people‘s lifestyles, Derived from experience-based associations and the
issues, needs, desires, etc. emotional connections that grow from them
Relevance gains repeat consideration Brand Equity provides insulation
When Is Brand Power Achieved? Brand Loyalty
 Customer will not change brands for price reasons

 Brand loyalty is the bias, behavioral response,
 Customer is satisfied; no reason to change expressed over time, by some decision-making
unit, with respect to one or more alternatives, and
 Customer would take pains to get the brand is a function of psychological process
 Customer values the brand and sees it as a friend – ‗Loyal customer base‘ is the essence of brand building
 Customer is devoted to the brand
Brand Loyalty Brand Loyalty

• Trust: Willing to rely on brand
• Consistency: No variation in quality
 Loyal customer base depends on:
• Accessibility: Accessible to customers
• Trust • Affinity • Responsiveness: Quick response to customers
• Commitment: Dedicated to customers
• Consistency • Social bonds
• Affinity: Identify with brand
• Accessibility • Psychological bonds • Social bonds: Customer-seller relation
• Responsiveness • Financial bonds • Psychological bonds: Influencing personality, lifestyles
• Financial bonds: Discounts offering
• Commitment • Structural bonds
• Structural bonds: Physical connection between buyer‘s and
seller‘s systems
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Brands Are Customer Possessed Brands Are Customer Possessed

Thirst
Urban Refreshing
 …an intangible and a perceptual
Orange
entity that remains in minds Cola Black
Fun
Brand is possessed  …like knowledge structure which
Fanta
by customers but lives in customer‘s mind in form Pepsi Coke
owned by firms Good
of a universe of associations
Times US Mirinda
because it is … which stores information, creates
brand awareness and brand Young
Sweet
associations, and elicits customer
response S. Khan
Rebel
Fig: Associative Network for Pepsi

To Sum Up .... Why Do Brands Matter?
Through branding, organizations:  What functions do brands perform?

 Create perceived differences amongst products
 More specifically, what brands do to:
 Develop loyal customer franchise
a) CONSUMERS
 Create value that can translate to financial profits b) MANUFACTURERS
Why Do Brands Matter? Reducing the risks in product decisions
 Risks consumers perceive in buying and consuming a

product:
• Functional risk—The product does not perform up to
expectations
• Physical risk—The product poses a threat to user‘s health
• Financial risk—The product is not worth the price paid
• Social risk—The product results in embarrassment
• Psychological risk—The product affects the mental well-
being
• Time risk—The failure of the product results in an
opportunity cost of finding another satisfactory product
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Can Everything Be Branded? Can Everything Be Branded?

YES!!! Even commodity can be branded
 How are brands created?  To brand a product it  The key to branding is that consumers perceive
is necessary to teach differences among brands in a product category
 How do you brand a consumers:
product?  Marketers can benefit from branding whenever
• Who the product is consumers are in a choice situation
• Firms create brand through • What the product
marketing programs, does
although it resides in the
minds of consumers • Why consumers De Beers Group added the phrase
should care it
―A Diamond Is Forever‖
What Can Be Branded? What Can Be Branded?

 Physical goods (BMW, Sony)
 Services (British Airways, FedEx, Hilton Hotel)
 Retailers and distributors (Sears, Wal-Mart, M&S)
 Online products and services (Amazon.com, Google)
 People and organizations (Maradona, Red Cross)
 Sports, arts, and entertainment (Real Madrid)
Tide
Google Maradona
 Geographic locations (Sunderbon)
& Red BD
Red Cross Green
Cross  Ideas and causes (AIDS Ribbons)
Physical Goods: B2B Products Physical Goods: High-Tech Products

 Don‘t brand only by naming
 Challenging due (technologists‘ view)
 Corporate perspective required
to the speed and
• Create a positive brand image and reputation for the  Financial success depends not only
brevity of T. PLCs on innovation but also on marketing
company as a whole which will create:
 Common mistakes skills
− Greater selling opportunity (reassurance and clarity)
− Promote brands  CEOs are the dominant factors
− More profitable relationships
based on a list of  Trust is critical, and customers often
− Competitive advantage attributes buy into companies as much as
products
• Some B2B firms believe that buyers are so informed and − Tend to think of
professional that brands don‘t matter brands as a  Need less mkt. budget but more
technical feature expenditures on mkt. comms.
(classical mkt. technique)
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Services: Role of Branding with Services Services: Professional Services
 Tanagibilize the service  Create corporate credibility in terms of expertise,

trustworthiness, and likeability
 Challenging as  Establish brand symbols
services are less because they  Overcome variability issue with professional services
tangible and more
− Make the abstract nature of  Individual employees have a lot more of their own
variable in quality services more concrete equity in the firm
 Need to address − Help identify and provide  Referrals and testimonials can be powerful when the
intangibility and meaning to different services services are intangible and subjective
variability − Signal to consumers that service
problems is special and deserving of its  Emotions can play a big role in terms of sense of
name security and social approval
Retailers and Distributors Online products and services
 Branding is challenging  Create unique aspects of the

because brand on some dimensions
 Attach unique like convenience, price,
 Brands can help create associations to service − Flashy or unusual ads fail
variety
quality, product to create awareness of
− Consumer interest,  Ensure that brands perform
why the brand is unique,
patronage, and loyalty in assortment, pricing, and
and why consumers satisfactorily in other areas
stores credit policy to stores
should buy it like customer service,
− The retailer‘s image and credibility and personality
 Introduce brands through − Their business models
establish positioning
using store names, are based on selling  Offer unique features and
creating new names, or information, products, services to consumers and
some combination of both and experiences avoid extensive ads
 Rely more on WOM and pub.
People and Organizations Sports, Arts, and Entertainment

Marketing people and organizations as brands exists in
 Build up a name and reputation in a these areas
business context
 Branding is  Sports marketing has become  In arts and
− Right awareness and image determine sophisticated in recent years entertainment,
simple if the
the way people treat you, interpret buyers judge
product your words, and actions − Apply creative combination of ad,
category is promotions, sponsorship, direct mail, quality not by
− Check who the person is and what digital, and other forms of com. inspection, but
people or
kind of person he is in terms of skills,
− Build up brand awareness, image,
use cues such as
organization talents, attitude, and so forth people involved,
and loyalty
WOM, critical
 Some firms take on meanings − Establish brand symbols and logos
reviews, etc.
through their programs, activities, that work as a financial contributor
and products
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What Makes Branding Geographic Places Unique

Geographic Locations
Diverse Customer Segment
• Multicultural
 Promote cities, states, • Live There vs Visitors
 Increased mobility of regions, and countries • Businesses & Investors
both people and through the use of ad,
Locations Sell Experience
businesses and growth direct mail, and other
• Expectations Differ
in the tourism industry com tools • Themes are Key “Excitement”
have contributed to the − This will create awareness • Impacted by Weather & Location
rise of place marketing and a favorable image of a
location that will entice Every Place Has a History
visitors • Iconic Symbols and Sights
• Do you Keep or Change Impression
How Is Geographic Location Defined

Ideas and Causes
 Use phrase or slogan or

 Ideas and causes symbols for branding (AIDS
are branded by Ribbons)
mostly non-profit
organizations  Make them more visible
and concrete
To Sum up.... Keys to Enduring Brand Leadership
 Branding is universal and pervasive in different

product categories
 Applicable to both tangible and intangible offerings

 Technological developments have impacted the way
firms market their offerings
 Organizations reap financial benefits from positive
brand images
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Essentials to Success of a Brand Essentials to Success of a Brand

Better Brand Strategy Superior Brand Strategy
 Two basic strategies can Offers more value on Offers competitive as well as
 Successful brands attributes or benefits sought some unique attributes or
achieve be used: by customers and beats benefits not offered by
discriminatory − Better Brand Strategy competition competition
response from − Superior Band Strategy Limits efforts to existing Goes beyond existing
consumers attributes or benefits attributes or benefits
Increases CV incrementally Increases CV exponentially
Ex: Toothpaste offers germ Ex: Toothpaste offers minting
protection round the clock attribute
instead of 12 hours
How to Build Superior Brands? How to Build Superior Brands?
 Must achieve valued discrimination  To achieve valued discrimination, marketers

must know:
 It is not sufficient just to achieve valued
discrimination or deliver what target market − For whom is the brand meant? (target market)
currently wants… − What do competitive brands offer? (similarity)
RATHER − What do customers desire or value but do not get?
(discriminating value)
Deliver what What customers

others fail to look forward to
5-Steps of Achieving Valued Discrimination 5-Steps of Achieving Valued Discrimination
1. Identify Segments 3. Determine Relative Importance

 Study existing segments‘ characteristics and  Rate these in order of importance
competition
4. Analyze Competition
2. Understand the Key Drivers of Buying  Make competitive analysis and customer
 List down the attributes/benefits/values analysis
sought
5. Find Sources of Discriminative Value
 Do extensive marketing research to figure out
 Find attributes which are the sources of
valued discrimination
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Strong Brands What are the Strongest Brands?
 Are brands that have been market

leaders in their categories for decades
 Any brand is vulnerable and susceptible
to poor brand management
− The appeal of brand is not timeless, if it is not
properly managed
Top Ten Global Brands (Interbrand) Factors Responsible for Branding

Challenges
Rank in 2015 2015 ($Billion)
1. Apple 170.28 Savvy
2. Google 120.31 customers
3. Coca-Cola 78.42 Increased Economic
4. Microsoft 67.67 accountability downturns
5. IBM 65.09
6. Toyota 49.05 Increased Brand
cost proliferation
7. Samsung 45.30
8. GE 42.27
9. MacDonald's 39.81 Increased Media
competition transformation
10. Amazon 37.85
© 2017 Prentice Hall 1-64
Factors Responsible for Branding

Brand Equity
Challenges
 The added value  The premium a brand
endowed to products can command in the
reflected in how market
consumers think, feel,
 The difference
and act with respect to
between the perceived
brand
value and the intrinsic
 Marketing effects value of a brand
uniquely attributable to
the brand
No common definition
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Principles of Branding and Brand Equity Brand Equity– Competitive Advantages
(1) Differences in outcomes arise from the ―added

value‖  Reduced marketing costs
(2) Added value can be created in many different  Trade leverage
ways
 Can charge a higher price
(3) BE provides a common denominator for
interpreting mkt. strategies and assessing brand  Can easily launch brand extensions
value  Can take some price competition
(4) Different ways in which the value of a brand can
be exploited to benefit the firm
Strategic Brand Management Identifying and Developing Brand Plans
Brand Brand Brand Value Chain

The four main steps of the Positioning Resonance Model
process:
Model Model Traces the value
The design and • Identifying and developing brand
plans How to create How to create creation process
implementation of a position in intense, active to better
• Designing and implementing
marketing programs customers‘ loyalty understand the
brand marketing programs
to build, measure, minds and relationships financial impact
• Measuring and interpreting brand
and manage BE performance guide with customers of brand
• Growing and sustaining brand integrated marketing
equity marketing to expenditures and
maximize CA investments
Designing and Implementing Brand Measuring and Interpreting Brand

Marketing Programs Performance
 Choosing brand elements  Marketers develop and

(mixing and matching) implement a BEMS to manage
brands profitably
 Integrating the brand into
− BEMS is a set of research
marketing activities and the
procedures designed to provide
supporting marketing
timely, accurate, and actionable
programs
information for marketers so that
 Leveraging secondary they can make the best possible
associations tactical and strategic decisions
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Measuring and Interpreting Brand

Performance Growing and Sustaining Brand Equity
Brand Audits Brand Tracking ME Management

A comprehensive Studies System
 Defining brand architecture
examination of a Collecting information A set of
brand to assess from consumers, on a organizational  Managing BE over time
its health, routine basis over processes designed
time on key to understand and  Managing BE over geographic
uncover its
dimensions identified use of the BE boundaries, cultures, and
sources of equity, concept within a
and suggest ways in the brand audit or market segments
firm
other means to know
to improve and − Creating BE charters
how brands and
leverage that − Assembling BE reports
marketing programs
equity − Defining BE
are performing responsibilities
Defining Brand Architecture Managing Brand Equity Over Time
Brand portfolio is the  It recognizes that any

A firm‘s brand changes in the supporting
set of different brands in
architecture marketing program for a
a particular category a
provides its general firm offers to its buyers Brand management brand may affect the
guidelines about needs long-term success of future marketing
branding strategy and Brand hierarchy programs
displays the number and
views of marketing
which brand elements decisions  It produces proactive
nature of common and
to apply across all the distinctive brand strategies to enhance CBBE
different products sold components across the and reactive strategies to
by the firm firm‘s set of brands. revitalize a brand that
encounters problems
Managing Brand Equity Over Time Managing Brand Equity Over Time
(a) what products it Brand revitalization:

represents, what core
 Brand reinforcement First, understand what the sources of BE were
benefits it supplies, and
requires the brand always to begin with.
what needs it satisfies,
be moving forward and and − Are positive associations losing their strength or
consistently conveying uniqueness?
the brand‘s meaning in (b) how the brand makes
− Have negative associations become linked to the
products superior, and
terms of… which strong, favorable, brand?
and unique brand Second, decide whether to retain the same
associations should exist positioning or create a new one
in consumers‘ minds.
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Managing Brand Equity over Geographic Managing Brand Equity over Geographic
Boundaries, Cultures, and Market Segments Boundaries, Cultures, and Market Segments
 In expanding a brand overseas, managers need  Global branding decisions

to build BE… − Decide which markets to enter
 …by relying on specific knowledge about the − Decide how to enter the market
experience and behaviors of those market − Decide on the marketing program
segments
− Decide on marketing organization
Strategic Brand Management Process
All rights reserved. No part of this publication may be reproduced, stored in a

retrieval system, or transmitted, in any form or by any means, electronic,
mechanical, photocopying, recording, or otherwise, without the prior written
permission of the publisher. Printed in the United States of America.
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Department of Marketing  Identify the steps in the strategic brand

© 2017 Prentice Hall 1-1 © 2017 Prentice Hall 1-2

What Is A Brand? What Is A Brand?

design or a combination of them, intended idea, the expectations that reside in

to identify the goods or services of one each customer‘s mind about a

 ―A brand is something that has actually  ―A brand is the summation of all

created a certain amount of awareness, perceptions, experiences and beliefs

reputation, prominence, and so on in the associated with a product, service, or

© 2017 Prentice Hall 1-3 © 2017 Prentice Hall 1-4

Why Is Brand So Important? Why Is Brand So Important?

As perceptions of all tangible Brands can have POWER…

Coors Is it more than hops, malted barley,

© 2017 Prentice Hall 1-5 © 2017 Prentice Hall 1-6

Are You A Brand? Brand Elements

© 2017 Prentice Hall 1-7 © 2017 Prentice Hall 1-8

Brand Elements Create Brands with an Identity That…

 Brand name is that part of a brand which

© 2017 Prentice Hall 1-9 © 2017 Prentice Hall 1-10

What Defines a Commodity Commodity Branding Strategies

© 2017 Prentice Hall 1-11 © 2017 Prentice Hall 1-12

Brands versus Products Brands versus Products

Can be copied by competitors Is unique

Comes and goes with time Is timeless???

© 2017 Prentice Hall 1-13 © 2017 Prentice Hall 1-14

Five Levels of Meaning for a Product Brands Conveying Six Meanings

 Attributes– characteristics and features

© 2017 Prentice Hall 1-15 © 2017 Prentice Hall 1-16

Every Brand Has A Personality Evolution From USP to HSP

Energetic Commanding Conservative Multisensory brand;

What Is Branding? Branding Pitfalls or Flaws

 Pitfall No. 1: A brand is  A brand is defined only by

© 2017 Prentice Hall 1-19 © 2017 Prentice Hall 1-20

Major Enemies of Brands Types of Failure of Brands

 Under nourishing  Parity Brands– offer only similar values

 Excessive milking  Inferior Brands– offer lesser value or suffering

© 2017 Prentice Hall 1-21 © 2017 Prentice Hall 1-22

Achieving Brand Power Achieving Brand Power

© 2017 Prentice Hall 1-23 © 2017 Prentice Hall 1-24

Achieving Brand Power Achieving Brand Power

Relevance gains repeat consideration Brand Equity provides insulation

© 2017 Prentice Hall 1-25 © 2017 Prentice Hall 1-26

When Is Brand Power Achieved? Brand Loyalty

 Customer will not change brands for price reasons

 Customer is devoted to the brand

© 2017 Prentice Hall 1-27 © 2017 Prentice Hall 1-28

Brand Loyalty Brand Loyalty

Brands Are Customer Possessed Brands Are Customer Possessed

Fig: Associative Network for Pepsi

To Sum Up .... Why Do Brands Matter?

Through branding, organizations:  What functions do brands perform?

© 2017 Prentice Hall 1-33 © 2017 Prentice Hall 1-34

Why Do Brands Matter? Reducing the risks in product decisions

 Risks consumers perceive in buying and consuming a

Can Everything Be Branded? Can Everything Be Branded?

© 2017 Prentice Hall 1-37 © 2017 Prentice Hall 1-38

What Can Be Branded? What Can Be Branded?

Physical Goods: B2B Products Physical Goods: High-Tech Products

Services: Role of Branding with Services Services: Professional Services

 Tanagibilize the service  Create corporate credibility in terms of expertise,

© 2017 Prentice Hall 1-43 © 2017 Prentice Hall 1-44

Retailers and Distributors Online products and services

 Branding is challenging  Create unique aspects of the

© 2017 Prentice Hall 1-45 © 2017 Prentice Hall 1-46