What is Branding?. The way in which a firm differentiates itself and its products from those of their rivals. A brand is a name, sign, color, or symbol used to identify items or services of the seller(s) and to differentiate them from goods of competitors. Branding. Three types of branding:
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What is Branding? • The way in which a firm differentiates itself and its products from those of their rivals. A brand is a name, sign, color, or symbol used to identify items or services of the seller(s) and to differentiate them from goods of competitors.
Branding • Three types of branding: • Manufacturer: products produced by a manufacturer are labeled under their own name, rather than that of a distributor • Intermediary: carries a name developed by the wholesaler or retailer. • Generic: represents a general product category and does not carry a company or brand name.
Brand Names • Forms of brand names: • Acronym – name made up of initials; BMW, KFC, BP, IBM • Descriptive or functional – represents a product benefit; Sparkle window cleaner or Mop and Glo floor cleaner • Personal names – named after the original founder; Ford, Chevrolet • Abbreviations – Xerox is short for xerography
Brand Names • Foreign Language Terms – Volkswagen literally means “the people’s car” in German • Mistakes – Google is a misspelling of Googal (a very large number) • Myth – names of mythical creatures; Nike, the Greek goddess of victory • Association – Apple was named after Steve Jobs worked on a community farm in Oregon
Importance of Branding • Customers can identify products quickly • Recognized from: packaging, logo, color, shape • Recognized through sound: TV advertisements, radio commercials, conversations with friends. • Brand loyalty • Increased revenue and market share • Customers are less likely to switch to competitors • Customers are prepared to pay a premium price for a particular brand
A truly successful brand is when that brand name becomes interchangeable with the generic name of the product. “I’m going to sneeze – pass me a Kleenex.” (tissue)
How a Brand Makes You Feel • Brand experience: customer’s thoughts, feelings, perceptions, beliefs, and attitudes when they are making a purchase • Brand image: customer’s emotions combine to build a reputation with which loyal customers identify
Protecting the Brand Name • An unregistered trademark is recognized by the letters “TM.” • Protection may only operate within the geographical area where it has been used. • Once legally protected, a brand name becomes a registered trademark. • The owner may take legal action for trademark infringement to prevent unauthorized use
Rebranding • A marketing strategy where a new name, term, symbol, design, or combination is created for an established brand • Purpose: develop a new, differentiated identity in the minds of consumers, investors, and competitors
Why Rebrand? • Identify with a new target market • McDonald’s “Mickey D’s” • Entering into a new line of business/market • Ex. Apple Computers Apple • Relevancy • Yellow Pages YP • Negative Publicity • Legal Issues
Risky Rebranding • http://www.youtube.com/watch?v=oJHF0OxQR4k • http://www.cbsnews.com/video/watch/?id=4844495n
Licensing • An agreement that gives a company the right to use another’s brand name, patent, or other intellectual property for a fee.
Licensing • Licensor: the company or individual granting the license for a fee in this legally binding contract. • Licensee: the company or individual paying for the rights to use the licensor’s name or property.
Licensed Products • In sports marketing, a company must pay a fee to use a league’s, team’s, or individual’s name, image, or logo on a product or its packaging. NFL grants product licenses to companies that want to use the NFL logo
Sponsorships & Endorsements • Sponsorships • Promotional vehicles that financially support sporting events • Operating sports events and leagues requires a significant amount of money • Salaries for players alone cost hundreds of millions of dollars
Sponsorships & Endorsements • Endorsements • A statement or approval of a product, service, or idea made by an individual or organization speaking on behalf of the advertiser • Can simply be an association with a product • Michael Jordan – Hanes • A company may choose a sports figure who matches the demographic profile of its customer base.
Why Product Licensing? • Money • Percentage of the revenue from the licensee goes to the licensor. • Example: Calvin Klein Inc licenses the designer’s name to makers of underwear, jeans, and perfume. They only make women’s apparel lines. They are receiving money from the sales of everything