Brand Personality, Brand Experience, Brand Identity & Luxury brand advertising

A summary

BRAND EQUITY

Brand Resonance Pyramid

Approaches for Valuing

Brands
1. Cost
Original cost to develop brand
Replacement cost
2. Market Valuation
Premium paid over book value
3. Income
Discounted value of future net revenues
Price premium over generic
Future brand extensions
4. Multi-factor Index

Approaches for Valuing

Brands
1.
2.
3.
4.

Interbrands
Young & Rubicam (Y&R)
Milward Brown
Others including media publications

Brand Asset Valuator Y&R

KERD ( Knowledge, Esteem,
Relevance, Differentiation)

KERD
High
Niche
Brands

Leadership
Brands

Strength
Differn./
Relevance

New/Unfocussed

Brands

Low

Eroding
Brands

Stature (Esteem + Knowledge)

High

Interbrands Brand Valuation

Calculation

Brand Revenues, Economic Earnings, Brand Earnings

What is each brand worth?

Dimension

Weightage (%)

Remarks

Leadership

25

Leadership in sector

Stability

15

Ability to survive

Market

10

Brands trading environment

Geographic spread

25

Ability to cross geographic and

cultural borders

Trend

10

Ability to stay contemporary

Support

10

Marcom activity

Protection
Interbrands brand valuation

Legal titles and patents

Brand Valuation Using the

Interbrand Index
Brand Equity =

Adjusted
Net Income
(after tax)

x
Brand
Strength

less earnings expected

for an equivalent
unbranded product
multiples range from 6
to 20

Ability to influence market

Ability to maintain a consumer franchise
Vulnerability of market demand to changes in
taste or technology
International scope
Long-term appeal to consumers
Strength of communication support
Security of legal or property rights

Brand Equity David Aaker

Loyalty
Reduced Mktg
costs
Trade
Leverage
Reduces
Cognitive
dissonance
Competitive
advantage

Awareness
Anchor to
Associations
Familiarity
Signals
commitment
Brand to be
considered

Perceived
Quality
Reason to buy

Differentiate /
Position

Associations
Create
Positive
feelings
Reason to buy

Price
Channel
Member
interest
Extensions

Differentiate /
Position
Extensions

Propriety
Brand Assets
Competitive
Advantage

BrandZ Milward Brown

1.Presence. Do I know about it ?
2.Relevance. Does it offer me
something?

3.Performance. Can it deliver?

4.Advantage. Does it offer
something better than others.
5.Bonding. Nothing else beats it.

Devising a Branding strategy

Individual/Corporate or sub-brands
Brand extensions
Licensing a brand
Managing brand portfolios

Flagship
Flanker
Cash cows
Low end entry levels
High end prestige
Cannibalization of brands

Customer Equity
CRM produces high customer equity.
Focus on customer lifetime value
Realizes that the cost of acquiring a new
customer is much higher than the cost of
retention.
Customers are the profit engine for a brand.

Conclusion
Brand Equity = Value
Marketing is an asset creator with strong
brands.
Brands can be enhanced through logos,
mneumonics and mascots
Brand equity is the intangible value created
through secondary associations and branding
strategies.
Brand equity can be measured.

LUXURY BRANDS

"Will

we use iPhones in 20 years?"

asked Antoine Arnault, director at
LVMH (Louis Vuitton Mot
Hennessy)
"Who knows. But in 20 years,
people will still drink Dom
Perignon."

Does Brand Identity Play a role in Luxury Brands?

BRAND IDENTITY PRISM : M&M AND BOLERO

Physique
M&M: Tough, economical,
Jeep looks, all terrain,
diesal, noisy
Bolero: Front grill, tough,
City, all-terrain, car like
Comfort, Latin
(music/name)
Relationship
M&M: Dependabl
Bolero: Outdoor, fun,
companion
User Image
M&M: Police, army, rural,
Middle class
Bolero:Yuppy, city dweller, sporty

Persona
M&M: Down to earth
tough, not young, son
of the soil
Bolero: Young, vibrant
sophisticated
CULTURE
M&M: Laid back, family
Bolero: Break free,
Modern outllook, pushing
hard.
Self Image
M&M: Prudent, macho, tough
Bolero: Free, enjoys life

Compare the Brand Identity of M&M and Bolero. Create a Brand Identity prism for
Scorpio.

Experiential Marketing
Focuses on customer experience
Focuses on the consumption
situation
Deals with consumer senses
SENSES
MOMENTS OF TRUTH
5.20

Brand Experience moments of truth

Product Experience
Shopping & Service Experience
Consumption experience

Staged Experience
aesthetic (including visual, aural, olfactory,
and tactile
(touch ), taste aspects),
educational,
entertaining,
and escapist experiences.

Descriptions of Experiential
Brands
Apple/iPod
I

love the touch and feel of the products.

I enjoy playing with all the products.
I am part of a smarter community.
This brand intrigues me.
I really feel Apple products go with my way of
life.
I use the iPod when I am jogging, and I exercise
more because of the iPod.

Starbucks
Smells nice and is visually warm.
Its comfortable and puts me in a better mood.
Its like being around a Barnes & Nobles crowd.
The Body Shop
Smells nice and is visually warm.
Its comfortable and puts me in a better
mood.
Its like being around a Barnes & Nobles
crowd.
.

Descriptions of Experiential
Brands
Nike
The search is elegant; it
creates a mood of
playfulness
and curiosity.
I feel happy and proud
because I am smart and
in-theknow.
With Google, I change the
way I organize and interact
with information.
Google

Makes me think of how to live an

active lifestyle.
Makes me feel powerful.
I want to work out.
I feel inspired to start working
out.
I feel like an athlete.
The store incites me to act, like
swing the baseball bat,
or put on the running shoes.
I enjoy designing my own shoe
that perfectly fits my Personality.

How much does this

bottle cost
in a Shanghai disco ?

1977 - Miuccia Prada became involved

Prada & Bertelli

Prada the case

How has Prada been able to counter luxury
groups like LVMH, Richemont and Kering ?
How does one create and sustain a luxury,
global brand?
Look at pradagroup.com and evaluate the
brands current challenges

During the 17th century, luxury usually referred to something rare,

like rare pearls, perfumes or spices, and later in the 19th and 20th
century luxury became the works of craftsmen- like Louis Vuitton the
trunk maker or Christian Dior, the
frock maker.

The top ten global luxury brands are ,

1. Louis Vuitton,
2. Hermes,
3. Gucci,
4. Prada,
5. Rolex,
6. Chanel,
7. Cartier,
8. Burberry,
9. Fendi
10. Coach.

Luxury or luxatio, means distance.

Luxury brands are therefore brands that are
used by consumers to keep their distance
from others.

During the 17th century, luxury usually

referred to something rare, like rare pearls,
perfumes or spices,
Later in the 19th and 20th century luxury
became the works of craftsmen- like Louis
Vuitton the trunk maker or Christian Dior,
the frock maker.

5 Categories of Luxury Brands

1. Luxury products (Cars, Jewelry & Watches, Fashion &
Accessories, Cosmetics Makeup & Fragrances, Food &
Beverages, Cigars & Cigarettes, Furniture, Magazines, Home
ware & Electronics, )
2. Exclusive services (Banking, Financial services, Insurance,
Cellular, Airlines, Clinics, Consulting, )
3. Retail spaces (Stores, Chains, Shopping centers, Malls, )
4. Illustrious Places (Restaurants, Bars, Clubs, Hotels,
Resorts, Housing projects, Offices/commercial complexes,
)
5.

Prestigious organizations (Brotherhoods, selective

membership,).

Prada the Case

Key Brand and Communication Problem

Films

Total size of the market was223 billion in 2014. Growth rate of 5%.

Its brand value is $4.04 billion.

Interbrand estimates their brand value at $4.27 billion.

The U.K. luxury goods company has a brand value of $4.34 billion..

he flagship Tiffany & Co. store in New York City. Its brand value is estimated at
$5.16 billion.

China replaced Japan as the No. 2 luxury market after the U.S. And Cartier owes
a lot of their $5.5 billion brand value to this country.

The Hermes in Paris. Super chic. Interbrand puts their brand value at $6.18 billion.

Gucci in Vietnam. Brand value: $9.45 billion. This next name is double that.

a brand value Interbrand estimates to be a whopping $23.58 billion.

Missoni Target & Zig Zag

4 types of luxury brands

1. Emphasis on beauty of the object and uniqueness (eg.Rolls
Royce, Cartier and Hermes).
2. Based on creativity and sensuality of the product includes
brands like Gucci, Boss and J P Gaultier.
3. Timeless and international brands like Porsche, Louis Vuitton
and Dunhill.
4. Rare, like the very premium end of Chivas.

The Pyramid Brand

Attributes
Pure creation, unique work,
materialized perfection

Relations
Money

The Griffe
Aura

The Luxury
Brand

The upper range

Brand

The Brand

Small series, workshop,

handmade work,
very fine craftsmanship

Series, factory, highest

quality in the category

Mass series, cost pressure,

the spiral of quality

Luxury
Cult

European approach

History

Stories
To Luxury

American Approach to Luxury

Merchandising

Activity
Each pair is to select a product and discuss
some of the issues of having a luxury brand in
this segment.
Garments
Bags
Services like banks
Retail spaces for luxury brands
Exclusive clubs
Restaurants

Class Activity example of BP/BE

Take five Brands: Coffee parlors

Caf Coffee Day

Barista
Costa
Nescafe
Starbucks

Lets do an exercise on Brand personality & Brand Experience

Thank You.