STRATEGIC MARKETING & PLANNING

Managements ongoing challenge: optimizing product performance. Process involves taking new product initiatives, managing existing product lines, tracking performance of total portfolio & taking timely action to avoid a down-trend.

New product initiatives put a strain on resources & reduce profitability. Absence of new product initiatives exposes company to future risk.
The bigger challenge: turning products into strong brands.

One definition: physical object that satisfies a customer need. Products today tangible goods & intangible services, on account of the benefits or satisfaction they provide.

Basic (AMA) definition: A brand is a name, term, design, symbol, or any other feature that identifies one sellers good or service as distinct from those of other sellers.

Seth Godins definition: A brand is the set of expectations, memories, stories & relationships that, taken together, account for a consumers decision to choose one product or service over another.

Brand value is merely the sum total of how much extra people will pay or how often they choose, the expectations, memories, stories & relationships of one brand over the alternatives.

Distinction between goods & services, previously seen in physical terms as being tangible & intangible now a thing of the past.

Goods & services often substitutable & often complimentary.

External & internal challenges 1. Intense Price/ Non-price Competitive Pressures; 2. Fragmentation of Markets & Media; 3. Complex Brand Strategies & Relationships; 4. Bias Against or Fear of Innovation; 5. Preference of Investing Elsewhere.

Creating customer value & creating share-holder value at the same time. A strategic perspective of a brand requires a good understanding of its value. Value of a brand in a company, is the basis for attracting (directing & sustaining) long-term investments.

Reduce:

1. Customers search costs - helping them identify products quickly & accurately; 2. Buyers perceived risk - perceived assurance of quality & consistency;
3. Social & psychological risks guilt or dissonance associated with owning & using the wrong product.

Ensure: 1. Repeat purchases by customers; 2. Better financial performance sustained business; 3. Introduction of new products customer identifies with & relates to previous experience with the brand; 4. Promotional effectiveness providing sharper focus;

And ensure

5. Premium pricing - on the basis of differentiation;

6. Market segmentation - by appealing to the target audiences everywhere; 7. Brand loyalty influence of trust on buying behavior.

10 most valuable brands 2011

1 2 3 4 5 6 7 8 9 10 Coca-Cola IBM Microsoft Google GE McDonald's Intel Apple Disney Hewlett-Packard 71,861 ($m) 69,905 ($m) 59,087 ($m) 55,317 ($m) 42,808 ($m) 35,593 ($m) 35,217 ($m) 33,492 ($m) 29,018 ($m) 28,479 ($m)

Effective strategic brand management requires an understanding of brand equity & its impact on brand management decisions.

 The

future earning potential of a brand!

the power of the brand to shift the consumer demand curve of a product or service (to achieve a price premium or a market share gain).

Typical BE measure a composite of: Economic value of the brand asset; Price premium that the brand commands; Long-term consumer loyalty the brand evokes; Market share gains it results in.

Strategic brand management consists of several interrelated initiatives:

Brand identity Identity implementation Brand strategies Strategi c brand analysis Brand equity Managing brand portfolio

Leveraging the brand

Brand identity is a unique set of associations that a brand owner/ manager wishes to create. These associations represent what the brand stands for & imply the promise made on behalf of the brand.

1. Specific product branding: when the

brand name applies to a single product giving it a unique identity e.g. Crest toothpaste, Pampers diapers; 2. Product-line branding: when a single brand name is applied on a selection of related products e.g. Toyota Corolla Gli, XLi; 3. Corporate branding: when the corporate name is used for identifying entire product line e.g. IBM;

4. Combination branding: when a

company uses a are corporate and product name e.g. Nestl Milkpak.
5. Private Label branding: used by

supermarket chains e.g. Tesco, Carrefour.

Strong brands may have an identity beyond the product or the company e.g.

1. Find new uses for mature brands:

Century-old Eagle Sweetened Condensed Milk now repositioned for use in fashionable mocha coffee and fondues. 2. Relaunch products related to heritage: P&Gs Oil of Ulay repositioned for younger audiencesor Old Spice!

Due to copyright difficulties, Olay was called by four different names, depending on the area of the world; Oil of Olay in America, Oil of Ulay in the U.K. and some of Europe, Oil of Ulag in other parts, and Oil of Olaz elsewhere. In 1999 the names were unified into Oil of Olay, the original name used by P&G in America.

Brand equity can be negative: Skoda cars in the UK; Encyclopedia Britannica & Microsoft; Retailer private brands vs manufacturers brands: lower prices & better display of retailer brands;

Major shifts in consumer tastes: falling demand for Cola drinks in early 2000s more effort on clear drinks & juices;

Competitive actions: Tapal & Lipton Tea; Unexpected events: Honda & Tsunami.

LINE EXTENSION

Minor variants of a single product are marketed under the same brand name Extensions of the brand name to other product categories --Similar --Dissimilar

BRAND EXTENSION

Co-branding/ dual branding: Two or more established brands making a joint offer; Participants brands identified on the good or service; Several different forms: Component co-branding (Volvo and Michelin) Same company co-branding Alliance co-branding (Delta and American Express) Ingredient co-branding

Failure to:
Fully understand the meaning of the brand. Live up to the brand promise. Adequately support the brand. Be patient with the brand. Adequately control the brand. Balance consistency & change in the brand. Understand the complexity of brand equity measurement & management.