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Brand Power. An exploration. A Working Example to Explain Brand Power: Big Box Electronics. The Big Box Electronics category is characterized by: Huge Dollar volume Small margins Domination by 2 National Chains. Big Box Electronics. Both have Big stores (U.S.) Semi-self service

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brand power

Brand Power

An exploration

a working example to explain brand power big box electronics
A Working Example to Explain Brand Power: Big Box Electronics
  • The Big Box Electronics category is characterized by:
    • Huge Dollar volume
    • Small margins
    • Domination by 2 National Chains
big box electronics
Big Box Electronics
  • Both have
    • Big stores (U.S.)
    • Semi-self service
    • Huge numbers of SKU’s in virtually every home electronics category
    • Major brands
    • Lots of promotions and Sales
    • Often located proximate to each other
the consumer electronics store dilemma
The Consumer Electronics Store Dilemma

Industry MythWhichever One Is

A Right Hand Turn is where people go

  • How does the consumer choose?

Scott

CES A

CES B

Raj

strategic questions
Strategic Questions
  • Is the myth true?
  • Can anything be done to drive a wedge?
  • What should the CES’s say about themselves?
a question
A Question
  • Should they talk about Products?
  • Or should they talk about Brands?
what is a product
What is a product?

A product is an arrangement of physical characteristics intended for some purpose

can we look at consumer electronics stores as products
Can we look at Consumer Electronics Stores as Products?

Do they have physical characteristics?

Are they arranged for a purpose?

Yes

So attribute-focused communication is one way we could go…

can we look at consumer electronics stores as brands
Can we look at Consumer Electronics Stores as Brands?

Are they representations of a product, service, organization or association that are perceived to be distinct?

can we look at consumer electronics stores as brands11
Can we look at Consumer Electronics Stores as Brands?
  • The Myth says: Maybe, maybe not …
    • But this is what we want to know!
why are brands so important
Why are brands so important?

Brands have power that can transcend the attributes and characteristics of products, because they are Perceptions of those tangible elements.

why are brands so important13
Why are brands so important?
  • Brands Can Have Power…
  • Coca-Cola Is it more than cola beans, corn sweetener, prunes, spices and food coloring mixed together?
    • Is it more than a beverage?
  • Coors Light Is it more than hops, malted barley, yeast and water?
  • Starbucks Is it more than coffee?
  • USA Is it more than 50 states united?
  • How about Chanel, BMW, McDonalds, Exxon?
why are brands so important14
Why are brands so important?
  • All of these are all brands with power
  • They have the ability to capture attention and often loyalty far above others
  • Think of what that means to your business
    • Everyday on the shelf
    • When introducing new products
    • In attracting talent
    • Or surviving PR crises
why are brands so important15
Why are brands so important?

Brand Power

has different levels

slide16

Brand Power Hierarchy

Relate the brand to a feeling, attitude, event, perception of myself that is important to me and who I am

Know that & how it has meaning

Know that & how it’s different

Brand

Power

Heard of it and know what it is

Heard of it, but don’t know anything about it

No awareness of the brand

slide17

Brand Power Hierarchy

Relate the brand to a feeling, attitude, event, perception of myself that is important to me and who I am

Know that & how it has meaning

Know that & how it’s different

Heard of it and know what it is

Brand Initiation

(where brands become brands)

Heard of it, but don’t know anything about it

No awareness of the brand

slide18

Brand Power Hierarchy

Relate the brand to a feeling, attitude, event, perception of myself that is important to me and who I am

Know that / how it has meaning

Brand with Differentiation

Know that / how it’s different

Heard of it and know what it is

Heard of it, but don’t know anything about it

No awareness of the brand

slide19

Brand Power Hierarchy

Relate the brand to a feeling, attitude, event, perception of myself that is important to me and who I am

Brand with relevance

Know that / how it has meaning

Know that / how it’s different

Heard of it and know what it is

Heard of it, but don’t know anything about it

No awareness of the brand

slide20

Brand Power Hierarchy

Brand with Equity

Relate the brand to a feeling, attitude, event, perception of myself that is important to me and who I am

Know that / how it has meaning

Know that / how it’s different

Heard of it and know what it is

Heard of it, but don’t know anything about it

No awareness of the brand

slide21

Brand Power Hierarchy

Relate the brand to a feeling, attitude, event, perception of myself that is important to me and who I am

To Build Brand Power,

We need to know where we are…

And determine how to get to higher levels

Know that / how it has meaning

Know that / how it’s different

Heard of it and know what it is

Heard of it, but don’t know anything about it

No awareness of the brand

achieving brand power
Achieving Brand Power

Brand Relevance

Brand Equity

Brand Differentiation

+

+

=

Brand Power

Brand Power is a function of Relevance, Differentiaton and EquityBP=f(D,R,BE)

understanding brands
Understanding Brands

Brand Differentiation

Characteristics and perceptions that are perceived to be different vs. alternatives

Differentiation buys trial

understanding brands24
Understanding Brands

Differentiation

1 Box

1 Rock

1 Clever “care and feeding” owners manual

= 1 million units in a couple

months,

but gone in a month more, because…

DIFFERENT, BUT, NO RELEVANCE

understanding brands25
Understanding Brands

Brand Relevance

Degree to which the brand is applicable to, or makes a connection with, people’s lifestyles, issues / needs / desires

  • Relevance gains repeat consideration
understanding brands26
Understanding Brands

Relevance

Combine:

Side Doors

Low Step in Height

Folding / removable seats

With Families and Dogs

= a revolutionary new vehicular class that has held almost a 10 share of all light vehicles since 1990

understanding brands27
Understanding Brands

2 Types of Relevance

  • Personal Relevance: compatibility with
    • Preferences / personal tastes
    • Beliefs and values
    • Perceptions of peer acceptance and social impact on the individual
  • Peer Relevance:
    • This can accelerate / decelerate / stall and reverse progression on the brand power scale
    • If enough “peers” start moving in a direction, the brand will go with it
understanding brands28
Understanding Brands

Brand Equity

Derived from experience-based associations with the brand, and the emotional connections that grow from them

Brand Equity provides insulation

understanding brands29
Understanding Brands

Brand Equity

Derived from experience-based associations with the brand, and the emotional connections that grow from them

  • Sturgis Bike Rally
  • Annual 10 day event
  • Unadvertised
  • Draws 550,000 bikers
  • 3/4 are over 40
  • Tax revenue alone -- over $1mm
brand equity breaking it down
Brand Equity -- Breaking it down

Brand Linkings

The Roots of Equity

Brand Linkings are Associations with the brand created through experiences -- events, people, places

how breaking it down brand equity cont
How -- Breaking it down -- brand equity (cont)

Equity Connections

Associations become Ideas, Memories and Feelings that represent how the brand can / does connect to their lives

With repetition, rehearsal and peer reinforcement, the linkings between the consumer and the brand become equity connections

Repetition

Rehearsal

Peer Reinforcement

Brand Linkings

The Roots of Equity

Associations with the brand created through experiences -- events, people, places

brand equity breaking it down32
Brand Equity -- breaking it down

=

Equity Connections

Brand Equity

Brand Equity is the meaning, significance or purpose that is derived from the Connections made with the brand through associations with experiences -- events, people, places.

Yes, equities are built on characteristics, but it is the meaning of those characteristics, achieved through experience that has power

BE = ∑(event, people, place associations with the brand * the connection people make between those association and their lives * value of that connection to them)

achieving brand power33
Achieving Brand Power

Brand Equity

Brand Relevance

Brand Differentiation

+

+

=

Brand Power

Brand Power is a function of Relevance, Differentiation and EquityBP=f(D,R,BE)

slide34

Brand Power Hierarchy

Brand with Equity

Relate the brand to a feeling, attitude, event, percpetion of myself that is important to me and who I am

Brand with Relevance

Know that / how it has meaning

Know that / how it’s different

Brand with Differentiation

Heard of it and know what it is

Brand

Heard of it, but don’t know anything about it

No awareness of the brand

slide35

Follow-up assignment

    • Where do you think the Consumer Electronic Stores are on the brand power index?
    • What brand issues do they need to address?
    • How would you position each brand?
slide36

Follow-up assignment

    • Hint -- what is positioning?

Brand Positioning

Expressing the relationship between the consumer and the brand in a unique (versus competition) and compelling way

Positioning is built on the differentiation, meaning and equity experiences associated with the brand

slide37

Follow-up assignment

    • Hint #2 -- applying brand power as a diagnostic tool
slide38

Bonus Question -- (much harder)

What are the volume, and profit implications in the short and long run of aligning with a positionings you have recommended?

Upsides?

Risks?

How might you go about assessing this?