Welcome to Strategic Brand Management. BU692u Strategic Brand Management â€“ Spring 2005. Agenda â€“ First Class. Course Objectives Class Format Performance Evaluation Introduction to Branding. Course Objectives. Understanding of what a brand is and how it is formed
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Agenda – First Class • Course Objectives • Class Format • Performance Evaluation • Introduction to Branding
Course Objectives • Understanding of what a brand is and how it is formed • Brand building in a variety of business contexts • Integrated requirements for brand building, reinforcement, & revitalization • Models, measures, & impact of brand equity • Learn through illustration & application
Class Format • Discuss key concepts – you & me • Illustrate their application – you, me, & guests • Questions for discussion – tasks to be performed from outline • Challenges, issues, & trends • Summarize
Performance Evaluation • Brand Audit Project (group) – 40% • Brand Personality Assessment (individual) – 20% • Brand Journal (individual) – 20% • Participation (individual) – 20%
Brand Audit Project • Brand Book • Brand History • Assessment of current status using course concepts – brand hierarchy, customer-based brand equity, brand positioning, brand mantra • Analyses of how branding elements and marketing mix are contributing to this brand status • Recommendations re: building & managing brand equity in the future • Brand choice – 2nd class – April 23rd • Presentation – last class – June 24th/25th
Brand Personality Assessment • Capturing a brand’s personality • Apply Aakers’s brand personality scale • Projective techniques to create an image for your brand • Use Zaltman’s ZMET technique to create a collage for your brand • Use Fournier’s typology to describe the relationship that you have with your selected brand • Implications from above • Powerpoint presentation (5 slides) – May 6th/7th session
zehrsBrand PersonalityBu692u – Rick Beutler Background – Kitchener, 1950: Zehrs father & sons began family market focused on superior customer service, value, and quality – acquired by Loblaw Companies in 1963 – currently 58 stores in Southern Ontario Slogan, Mantra – “The best of everything you need” Value Proposition – Zehrs sells quality products and services that provide good value at a low price for its customers; expects to continue to be known as low cost operator through innovative and customer orientated actions; expects honesty and integrity dealing with customers, employees, suppliers, and community.
Aaker’s Brand Personality Scale (like McDonald’s) • sincerity, competence, and sophistication X excitement, and ruggedness Projective Techniques (Golden Lab) animal (dog); activity (routine eating); fabric (natural cotton) music (mainstream top 40); vehicle (minivan); occupation (management); TV show (Everybody Loves Raymond) Fournier’s Typology (Courtship/Compartmentalized Friendship) Interdependence – committed; Self Concept – engaged; Commitment – engaged; Love/Passion – engaged; Intimacy – engaged; Partner Quality -- committed
zehrsZMET Collage Most Representative: High value, one-stop shopping for people on the go Friendly service Strong presence in Community Quality, healthy food Boring, daily errand Convenient, not just food Private and national brands, value priced Active, suburban families Celebration, Family & Friends Availability, costs a bit more
zehrsApplication to CBBE Pyramid • RESONANCE • LOYALTY (F) • ATTACHMENT (F) • COMMUNITY (Z) • ENGAGEMENT (F) • FEELINGS • WARMTH (Z) • X FUN (Z) • X EXCITEMENT (Z) • SECURITY (A, P) • SOCIAL APPROVAL(P,Z) • SELF-RESPECT (F) • JUDGEMENTS • QUALITY (Z) • CREDIBLE (A, F) • CONSIDER (Z) • SUPERIORITY (A, Z) • PERFORMANCE • PRIMARY CHARACTERISTICS & • SECONDARY FEATURES • PRODUCT RELIABLE, DURABLE & SERVICEABLE (A, F, Z) • SERVICE EFFECTIVE, EFFICIENTY, & EMPATHETIC (A, Z ) • STYLE AND DESIGN (P, Z) X PRICE (Z) • IMAGERY ? PROFILES (P, Z) • PURCHASE & USAGE SITUATIONS(F, Z) • PERSONALITY & VALUES (A, P) • HISTORY, • EXPERIENCE (F, Z) SALIENCE: • DEPTH OF BRAND, RECALL & CATEGORY ID (A, F, P, Z) • BREADTH OF BRAND, NEEDS SATISFIED (A, F, P, Z) ABBREVIATIONS: A = Aaker F = Fournier P = Projective Z = ZMET • SYMBOLS: • = Mid To High Score X = Below Mid Score ? = Not Enough Data
Brand Journal • 10 or more articles that address topic of branding • Concept illustrated in the article and its implications for marketers – a crisp paragraph for each article • Articles can be discussed through the term • Journal to be submitted June 18th
Participation • Class discussions • Journal examples • Interaction with guest speakers • “Value added contributions”
Questions for Discussion • What is a brand? How is it formed? • Can anything be branded? Are you a brand? • How does branding affect consumer behaviour? • What are the challenges to branding in today’s marketplace and what are the implications for marketers?
What is a Brand? Traditional view - • A brand is a name, term, sign, symbol, or design which is intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors. More recent views • Brand is what is experienced and valued by customers in everyday social life. • Brand is the culture of the product – shared taken –for-granted brand stories, images, and associations • Brand is the mental and emotional file we havefor a product or service or entity.
2: Managing a Brand Image through Marketing “A brand is a living entity – and it is enriched or undermined – cumulatively over time, the product of a thousand small gestures.” Michael Eisner, CEO Disney
1971 For a fee of $35, the Swoosh trademark was created by a graphic design student named Carolyn Davidson.
Before Coca-Cola there were soft drinks.
Before STARBUCKS there were coffee shops.
Before Microsoft there were software applications.
Before Nokia there were cell phones.
Catalysts for Branding - Interbrand • New offering, new promise • Strong, nimble competition • Sophisticated, savvy & demanding customers • Price & margin pressures • Sales & market share pressures • Combinations & divestitures • Organic growth • New revenue streams • Share price performance • Employee attraction, retention, & productivity
New Branding Challenges • Brands are important as ever • Consumer need for simplification • Consumer need for risk reduction • Brand management is as difficult as ever • Savvy consumers • Increased competition • Decreased effectiveness of traditional marketing tools and emergence of new marketing tools • Complex brand and product portfolios
Branding by Retailers – Example: Walmart’s 5 Next Victims – Forbes 11/12/2004 • Consumer Electronics – Best Buy #1, Walmart #2 but recently rolled out private brand ILO., expanded brand relationships with Sony, RCA, Panasonic • Banking – trying to get into banking but thwarted by regulators, instead it offers check cashing, bill payment, & money orders & boasts 28 Wal-Mart Money Centres operated by Sun Trust Banks plus it has I-store bank branches with other banks • Pharmacy – currently 4th in pharmacy business, rolling out a handful of 24hr pharmacies • Gasoline – 1555 stations on Wal-Mart properties, 300 of which are operated by Sam’s Club, rest by Murphy • Fashion – bought #1 selling British apparel brand George from Asda, licenses Mary-Kate & Ashley lines from the Olsen twins
Necessities Brand Portfolio Premium Quality Premium National Brand Sam’s Choice Great Value National Brand Same as for Less Quality Special Kitty Equate EverActive Equate Ol’ Roy Fit for Purpose D 82 Impulse D 46 Pharmacy / OTC D 02 HBC D 07 Pets Private Brand D 04 Cleaners & Paper Goods License National Brand
Branded Value-Added Chain Regional Brands Kraft Heinz President’s Choice Gourmet No Name
The Customer/Brand Challenge • In this difficult environment, marketers must have a keen understanding of: • customers • brands • the relationship between the two
The Concept of Brand Equity • The brand equity concept stresses the importance of the brand in marketing strategies. • Brand equity is defined in terms of the marketing effects uniquely attributable to the brand. • Brand equity relates to the fact that different outcomes result in the marketing of a product or service because of its brand name, as compared to if the same product or service did not have that name.
The Concept of Customer-Based Brand Equity • Customer-based brand equity • Differential effect • Customer brand knowledge • Customer response to brand marketing
the public’s perception
Determinants of Customer-Based Brand Equity • Customer is aware of and familiar with the brand • Customer holds some strong, favorable, and unique brand associations in memory
Customer-Based Brand Equity Model INTENSE, ACTIVE LOYALTY Consumer- Brand Resonance RATIONAL & EMOTIONAL REACTIONS Consumer Judgments Consumer Feelings POINTS-OF-PARITY & POINTS-OF-DIFFERENCE Brand Performance Brand Imagery DEEP, BROAD BRAND AWARENESS Brand Salience
In which product categories to you exhibit strong brand loyalty? Why?
Lovemark’s Love/Respect Axis Respect – Performance, Trust, Reputation Brands – Low Love, High Respect Lovemarks – High Love, High respect Love – Mystery, Sensuality, Intimacy Products – Low Love, Low Respect Fads – High Love, Low Respect
How to put Love in your Brand • Find your most passionate customers and listen to them • Put your brand through the love-respect axis • Start telling stories – show your brand as part of an experience, a myth, or a dream
Building Customer-Based Brand Equity • Brand knowledge structures depend on . . . • The initial choices for the brand elements • The supporting marketing program and the manner by which the brand is integrated into it • Other associations indirectly transferred to the brand by linking it to some other entities
Benefits of Customer-Based Brand Equity • Enjoy greater brand loyalty, usage, and affinity • Command larger price premiums • Receive greater trade cooperation & support • Increase marketing communication effectiveness • Yield licensing opportunities • Support brand extensions.
“The continuously strong rise of Samsung’s brand value reflects the company’s commitment to invest in its brand on a global scale and make brand value a key corporate target throughout the organization, including the CEO and all employees.” -Jan Lindemann, Global Managing Director of Interbrand
Brand Value in 2003= US$10.8 billion (31% increase from 2002) A result of making brand building the key focus in their marketing strategy
Customer-Based Brand Equityas a “Bridge” • Customer-based brand equity represents the “added value” endowed to a product as a result of past investments in the marketing of a brand. • Customer-based brand equity provides direction and focus to future marketing activities
The Key to Branding • For branding strategies to be successful, consumers must be convinced that there are meaningful differences among brands in the product or service category. • Consumer must not think that all brands in the category are the same. • PERCEPTION = VALUE