PDM

What is a product?
• A product is any offering by a company to
a market that serves to satisfy customer
needs and wants.
• It can be an object, service, idea,etc.
 Defining “Product”
Target Market

Product Place Promotion Price

Product
Brand Package Warranty
Idea

Physical
good/service Type of Brand:
Features Individual or Protection,
Quality level family Promotion, None, full, or
Accessories Manufacturer or or both limited
Installation dealer
Instructions
Product line
 Product Levels
Customer value hierarchy
• Core benefit
• Basic product
• Expected product
• Augmented product
• Potential product
 Product Hierarchy
• Need
• Product family
• Product class
• Product Line
• Product type
• Brand
• Item
 Product classification
• Durable
• Non – durable
• Services
 Consumer goods classification
• Convenience goods
• Shopping goods
• Specialty goods
• Unsought goods
 Industrial goods classification
• Materials and Parts
- raw materials
- manufactured materials and parts
• Capital items
• Supplies and business services
 Product Mix
• The assortment of products that a company
offers to a market
• Width – how many different product lines?
• Length – the number of items in the product mix
• Depth – The no. of variants offered in a product
line
• Consistency – how closely the product lines are
related in usage
 Product Line decisions
• Product rationalization
• Market rationalization
• Product line length
too long – when profits increase by dropping a
product in the line
too short – when profits increase by adding
products to the product line
• Line pruning – capacity restrictions to decide
 Important Definitions
• Product line
– A group pf products within a product category
that are closely related
• Product mix (product assortment)
– The set of all product lines and items that a
particular seller makes available to buyers
• Brand mix (brand assortment)
– The set of all brand lines that a particular
seller makes available to buyers

11.11
 Depth of a Branding Strategy
• The number and nature of different brands
marketed in the product class sold by a firm
• Referred to as brand portfolio
• The reason is to pursue different market
segments, different channels of distribution,
or different geographic boundaries
• Maximize market coverage and minimize
brand overlap

11.12
 What Is Brand Management?
• It is the group that oversee’s all aspect of
a product, from marketing, packaging,
sales & distribution strategies, pricing,
overseeing the P&L, manufacturing and
product improvements.
 What Is Brand Management?
• You are literally the “champion” of the brand. It
is your job to make sure it performs the best it
can.

• Interface will all aspects of the organization:

Finance, PR, Manufacturing, Product
Development, Sales, Market Research,
Advertising, etc.

• It’s the hub of the wheel.

Strategic Marketing Planning

…is the managerial process of

developing and maintaining a
strategic fit between the
organization's objectives and
resources and its changing market
opportunities.

Org Objectives Strategic Fit Resources

Changing Environment
 Strategic Marketing

“Marketing Strategy is a series

of integrated actions leading
to a sustainable competitive
advantage.”
John Scully
 Business Strategy covers all basic goals and
objectives of the business
Investor’s
Relations

Marketing
Capital

Financial
Plan
Project Strategy Plan
Public Offering Management

Financial
Controlling
Business
Strategy
Management
Plan
Salesforce
Operations

HR, Training &

Recruiting Plan
Certificate

Sales
Infrastructure Program

Legal FDA
Regulations
Production &
Logistics
 Momentum develops the Marketing Strategy and
prepares the tactics to the market

Momentum

Artefill Marketing Dept. Agency

Management

Target Market Sales & Distribution

Positioning

Tactics
Marketing Promotion Policy

Strategy Communication
Market
Plan Product Mix
Branding

Objectives Pricing Policy

 Marketing Planning is a step-by-step process
Market Research

Bus. Review

Competition An. Marketing Strategy Development

Target market
Definition

Positioning

Communication

Branding

Strategy

Tactics
 THE INTER-RELATIONSHIP BETWEEN
MARKETING AND CORPORATE

STRATEGY
INFORMS
 DIRECTS
 GUIDES
 CONTROLS

Corporate Strategy Marketing Strategy

• Specifying the • Identifying product market/s to
organisation’s mission compete in
• Allocating resources • Selecting market segments to
• Defining Organisational target
objectives • Developing the marketing mix
 ACHIEVES
 SUPPORTS
 OPERATIONALISE
MARKETING ENVIRONMENT
4 Main Ways of Approaching Marketing Strategy

THINKING FIRST

SEEING FIRST COMPETITIVE

MARKETING
DOING FIRST STRATEGY

SIMPLE RULES
 Marketing at the SBU Level—
Strategic Marketing

• Strategic Marketing requires

– Detailed understanding of market needs, and
–well
Proactive use of competitive intelligence at the corporate as
as SBU’s levels
• Strategic Marketing
– Focuses on what the firm do best at the SBU level
–To secure and maintain a sustainable competitive advantage
 The Competitive Environment
Kinds of Markets

Competitor Analysis
Key
Concepts
in the Competitive Rivals
Competitive
Environment
Competitive Barriers

Information on Competitors
Gajni
 Before 25 Decemberth

• First Look:
Ghajini's marketing started way back from March 20
• when he came out on the premier of RACE with his new
BALD look.
• It actually gave the perfect sneak peek at the two looks
of Aamir in the movie.
• Notice the jacket and rolled up half sleeves?
• Did anyone say Sanjay Singhania?
• And then
– in November, this photo shot across leading dailies
and Aamir without even showing his face and his 8
packs instantly became the talk of the town.
• The 8 pack promotion:
October 2007 and remember SRK and the ho-hallah
around his 6 pack abs.
• It was only around that time that Aamir silently started
working on his own, and just to make it better, he added
a pair and made it eight!
• The fact that the man now had a 8 pack and a fantastic
body, he decided to show the world how he got it!
• Up came the videos with 'Making of Aamir's 8 pack' on
all news and entertainment channels.
• Videos similar to this you tube got thousands of visits!
He even went a step ahead and called a press conference
to introduce his trainer and explain his diet chart!
– Television appearances
With the TV channels filled with Ghajini promos,
Aamir went into overdrive with his interviews, which
came in by the day on every news and entertainment
channel. Not to forget the guest appearances on
reality shows, which is now a sort of a norm.
– Offline Promos at Theaters

– 'Theater personnels with Ghajini hair cut' act that he did on the
release on Rab neBana di Jodi.Simply Fantastic. Imagine going
to a cinema hall to watch RNBDJ and you watch all these Aamir
Khan look alikes and his life size cut outs. You almost wish that
you had come to watch Ghajini!
 Co branding
• Tata Sky started running Ghajini “specials” complete
with behind-the-scenes stories of the upcoming
film. Samsung launched special Ghajini edition mobile
phones of L700 and M200 models. These handsets have
preloaded with Ghajini ringtones, pictures and songs.
Tata Indicom started with a outbound dialer service with
Khan's pre-recorded voice.
 Co branding
• Van Heusen launched Ghajini's apparels in their stores
all across India and is backing it with in-store campaigns
and giant posters of Khan dressed in formal attire.
Van Heusen also organized a fashion show wherein
models along with Aamir sported the Ghajini look.Add a
little big of jig and a bit of Guzarish and he had all the TV
channels beaming again!
 Viral SMS campaign

• Remember the chain SMS which threatened to reveal

what could possibly be the climax of the film? For those
who were not on the mailing list, here it goes...“Someone
killed Aamir’s girlfriend and he lost his memory. Then he
tries to find out the killer. Suspense… Aamir himself is
the killer. Now enjoy Ghajini!”

• I bet this one was proposed by someone at Tata

Indicom!!!
 Digital Promotion
• With so much happening offline, something had to be done online
to.
• And Ghajini makers had that well covered.

• Websites like www.rememberghajini.com, www.findghajini.com and

www.wallofsuspects.com were built to drive curiousity levels around
the movie and provide a movie like experience on the Internet.
Add to that a 3D PC game and a number of mobile games and
applications, and you have the digital space busy.
Not to forget that he has his own popular blog, which was a
constant source of dope for all those waiting for Ghajini to release.
 Final Week Controversy
• Just to cap it all, we had this 'Ghajini Release
Stayed' court notices which threatened to stop
the release of the immensely anticipated film a
day before 25th December. Naturally, this
became breaking news with minute to minute
tracking on the latest updates. And after much
drama, when the permission was granted, it was
like a whole nation had taken a sigh of relief and
they could all breath again!
 10 month Campaign, where we saw Aamir from
8 pack fighting machine to
turning in to a barber
on the streets of Delhi, is a
real case study in motion picture marketing.
• To hear from the horse's mouth :

With Ghajini we've opened with the

highest number of screens ever. So the
marketing needed to have depth and
width, so we needed to be very
aggressive with the marketing of the film.
 After 25th December:

• 100% opening day collections with over 1500

prints
• Over 90 crore business by the end of first
Sunday
• Expected 120 crore by end of first week
• Best Ever Opening
• Top film of 2008 already
 The end result
• It raked in Rs 90 crores in the ist weekend of its
release
• Marketing cost was Rs 7.5 crore and the global
box office off-take Rs 260 crore
• They honestly told the consumers
– what to expect through a major use of IMC – Aamir’s
physical appearance , the haircut , the in cinema
visibility ; ushers having a similar haircut
– The audience was prepared for what they were going
to see
The Marketing Concept
Customer
Customer Total
Total Company
Company
Satisfaction
Satisfaction Effort
Effort

The
Marketing
Concept

Profit
Profit
 Strategy Decision Areas
Product Place Promotion Price
Physical Goods Objectives Objectives Objectives
Service Channel Type Blend Flexibility
Features Market Exposure Salespeople Level over PLC
Quality Level Kinds of Kind Geographic
Accessories Middleman Number Terms
Installation Kinds and Selection Discounts
Instructions Locations of Training Allowances
Warranty Stores Motivation
Product Lines How to Handle Advertising
Packaging Transporting Targets
Branding and Storing Kinds of Ads
Service Levels Media Type
Recruiting Copy Thrust
Middlemen Who Prepares?
Managing Sales Promotion
Channels Publicity
 Marketing Strategy Planning Process

Narrowing down to focused strategy with screening criteria

Customers
Segmentation Product Place
S. & Targeting
W. Target
Company O. Market
T. Differentiation
& Positioning Price Promo

Competitors

External Market Environment

 STP

Segmentation Targeting Positioning Perceptual Mapping

 Steps in Market Segmentation,
Targeting, and Positioning
Market Market Market
Segmentation Targeting Positioning
1. Identify 3. Evaluate 5. Identify
segmentation attractiveness possible
positioning
variables and of each concepts for
segment the segment each target
market segment
4. Select the
2. Develop target 6. Select,
profiles of segment(s) develop, and
communicate
resulting the chosen
segments positioning
concept
 What is a Brand?

• A brand is a “name, term, sign, symbol, or

design,or a combination of them,” intended to
identify one seller’s products as distinct from
those of other sellers seeking to satisfy the same
need.
Brand identity
Brand Wheel
Features Preference, but
Benefits not loyalty

Values Relationship &

loyalty
Personality

Key Core of the

Reward claim
Some top Global Brands (2006)
 The Importance of Brands
"Of all the things that your company owns, brands
are far and away the most important and the
toughest. Founders die. Factories burn down.
Machinery wears out. Inventories get depleted.
Technology becomes obsolete. Brand loyalty is
the only sound foundation on which business
leaders can build enduring, profitable growth." --
--Jim Mullen
 Brand Mantras

• A brand mantra is an articulation of the “heart and

soul” of the brand.
– Brand mantras are short three to five word phrases that
capture the irrefutable essence or spirit of the brand
positioning and brand values.
• Nike
– Authentic Athletic Performance
• Disney
– Fun Family Entertainment
Brand Brand Name

Trademar Generic
k Name

Product Line Product Mix

Individual
offering
Co-Branding

Two companies join to create a new

product carrying both their brands.
 Co-Branding

Examples:

McCains cake and KFC

McDonalds & movie Mulan
Pizza Hut & Pepsi
Cereal box with other thing inside
Pizza Pizza and Blockbuster video rental &
Chocolate bar
Cinelex Odeon and Blockbuster
 Brand Name

Words, letters, or symbols that make up a

name used to identify and distinguish the
firm’s offerings from those of its
competitors.
Trademar
k
A brand that has been given legal protection
and has been granted solely to its owner.
National
Brand
Private
Brand
Generic Name
Brand Generic
Goods
 Brand Loyalty Categories

1. Brand Recognition (also called Brand Equity)

2. Brand Preference / Loyalty
3. Insistence
• Brand Recognition / Equity - awareness, loyalty, quality,
emotion
• Brand Preference / Loyalty - the degree to which
customers are committed to further purchases eg. I will
always buy Reebok (Brand Insistence)
________________________________________________
• Brand Awareness -your product is the first that comes to
mind in a certain product category
eg. Noodle-maggi, jeans-Levi’s, walkman - SONY
• Brand Association - the link to favourable images,
celebrities, geographic regions
 Brand Elements illustrations

• We try harder
• Just do it • I’m lovin’ it
• We also make Steel • Always low prices
• Desh ka namak
• Desh ki dhadkan
Brand Elements
 Secondary Associations

•
.
Source: Kotler & Keller, A Framework for Marketing Management, 3rd Edition, 2007
 A Blueprint for Brand Equity

• Assetts • Liabilities
• Brand Awareness • Dissatisfaction
• Brand Loyalty • Environmental
• Brand Relevance • Disasters
• Perceived Quality • Product Failures
• Other Positive • Lawsuits / Boycotts
• Associations • Questionable
• Business Practices
 Brand Value

"Well-managed brands have extraordinary

economic value and are the most effective
and efficient creators of sustainable
wealth."

-- Rita Clifton in Brands and Branding

 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
The Customer/Brand Challenge
• In this difficult environment, marketers must
have a keen understanding of:
– customers
– brands
– the relationship between the two
Brand Portfolio Structure
• Brand Grouping: Grouping of brands
that have a meaningful characteristics in
common
– Segment: Men or women
– Product: Clothing or products
– Quality: Designer to premium
– Design: classic or contemporary
 Five Dimensions
Dimension Action Item
Brand Portfolio Inventory existing brands and subbrands.

Identify brands playing strategic roles (cash-cow,

Portfolio Roles
etc.)
Look at use of endorsers and subbrands, branded
Product-Market Context Roles
benefits, co-brands, and driver brands

Brand Portfolio Structure Create brand grouping or hierarchy tree.

Lay out a sample of the way that the brands are

Portfolio Graphics
presented visually.
 Core Brand Values
• Set of abstract concepts or phrases that
characterize the 5-10 most important
dimensions of the mental map of a brand.
• Relate to points-of-parity and points-of-
difference
• Mental Map  Core Brand Values  Brand
Mantra
 Building Brand Equity

• Based on all brand-related contacts

whether marketer-initiated or not.
– 1. Initial choices for brand elements.
– 2. The product, ancillary services, and other
accompanying marketing mix activities.
– 3. Other secondary associations.
 Branding Strategy

One of the great benefits of brand equity is the

ability to leverage the “goodwill” of customers
to grow your business…

Portfolio Considerations Brand Leverage

Multiproduct Branding Line Extension
Multibranding Category Extension
Combination Co-Branding
In-Depth: Multiproduct Branding
• Multiproduct Branding occurs when a
single name serves as the base brand
name across all product categories.

» Examples?
» Advantages? Disadvantages?
 In-Depth: Multibranding

• Multibranding occurs when a company

uses different brand names to represent
different products, product lines, product
categories, or even SBUs.
 Examples?
 Advantages? Disadvantages?
 In-Depth: Combination

• A combination of branding strategies is used when a company

combines a corporate-wide (or parent brand) name with a sub-brand
name for a distinct product or line of products.
• There are many variations of this, such as using model names or
numbers.
 In-Depth: Brand Extensions

• Line extensions are new same-branded products that allow for

expanding your offering in a product category that you already
serve.
Category extensions are new same-branded
products that allow for entry into a product
category that you do not currently serve.
Lessons About Successful Brands
 Lesson #1: Brands Pay
• Brands which place high importance on
managing the economic value of their
intangible assets, and primarily their
brands, consistently outperform basic
economic measures.
Lesson #2: Good Brands Listen
• The best brands follow their stakeholders’
journeys so that they provide effective,
consistent and appropriate messaging
throughout the experience.
Lesson #3: Brands Anticipate
Having foresight helps companies make
informed choices about their brand and
frees leaders up to make bold moves in
the full knowledge of the implications.
 Problems Facing Branding
 No of brands
 Clutter in shop shelves
 Consumers are continuously exposed
through various forms of media
 Differnetiation or USP is weak
 High competition
 Entry barriers
 An Example: Sony
• 99.5 percent of people said they'd be willing to
pay more for a Sony. In 2004
• However, in 2000 Sony charged 44 percent
more for its DVD players than the average.
In 2004, Sony DVD players cost just 16 percent
more than the average.
• Although the price of Sony's most expensive
DVD player fell 60 percent between 1999 and
2003, CyberHome, maker of absurdly cheap
DVD players, has knocked off Sony to become
the biggest DVD-machine seller in America
 Future of Branding
• Vibrant Brands Require Regular
Maintenance and updating
• Older Brands which do not stay
contemporary will lose
• Cannot depend on customer loyalty in age
of consumer knowledge and skepticism
 What is Brand Equity?
• The “added value” endowed by the
brand name
• Key elements: Associations,
Awareness, Perceived Quality, Loyalty
• Intangible, but measurable
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
 Benefits of Brand Equity
• Asset management/leveraging
• Consumer franchise (facilitates loyalty)
• Lower communication costs
• Improved prices/margins/market share
• More power with the trade
More benefits of Brand Equity
• Barrier to competitive entry
• Effect of financial valuation of the firm
• Value to your Consumer
– Recognition, consistency, confidence,
image/status, etc.
 Managing Brand Equity
• It primarily involves managing the
consumer’s mind (associations)
• Firm must set objectives for the brand
• Brand equity measurement is a
management essential
• Marketing mix elements should be chosen
to build, not erode, brand equity
 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
 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.
Customer-Based Brand Equity
as 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
 Motivation for
Customer-Based Brand Equity Model
• Marketers know strong brands are
important but aren’t always sure how to
build one.
• CBBE model was designed to be …
– comprehensive
– cohesive
– well-grounded
– up-to-date
– actionable
 Rationale of
Customer-Based Brand Equity Model
• Basic premise: Power of a brand resides in the
minds of customers
• Challenge is to ensure customers have the right
types of experiences with products & services and
their marketing programs to create the right brand
knowledge structures:
– Thoughts
– Feelings
– Images
– Perceptions
– Attitudes
 Building
Customer-Based Brand Equity
• Building a strong brand involves a series of steps
as part of a “branding ladder”
• A strong brand is also characterized by a logically
constructed set of brand “building blocks.”
– Identifies areas of strength and weakness
– Provides guidance to marketing activities
CUSTOMER-BASED BRAND EQUITY PYRAMID

4.4. RELATIONSHIPS
RELATIONSHIPS ==
RESONANCE What
Whatabout
aboutyou
you&&me?
me?

3.3. RESPONSE
RESPONSE ==
JUDGMENTS FEELINGS
What
Whatabout
aboutyou?
you?

2.2. MEANING
MEANING ==
PERFORMANCE IMAGERY What
Whatare
areyou?
you?

1.1. IDENTITY
IDENTITY ==
SALIENCE
Who
Whoare
areyou?
you?
 Salience Dimensions

• Depth of brand awareness

– Ease of recognition & recall
– Strength & clarity of category membership

• Breadth of brand awareness

– Purchase consideration
– Consumption consideration
 Performance Dimensions

• Primary characteristics & supplementary

features
• Product reliability, durability, and
serviceability
• Service effectiveness, efficiency, and
empathy
• Style and design
• Price
 Imagery Dimensions
• User profiles
– Demographic & psychographic characteristics
– Actual or aspirational
– Group perceptions -- popularity
• Purchase & usage situations
– Type of channel, specific stores, ease of purchase
– Time (day, week, month, year, etc.), location, and context of usage
• Personality & values
– Sincerity, excitement, competence, sophistication, & ruggedness
• History, heritage, & experiences
– Nostalgia
– Memories
 Judgment Dimensions
• Brand quality
– Value
– Satisfaction

• Brand credibility
– Expertise
– Trustworthiness
– Likability

• Brand consideration
– Relevance

• Brand superiority
– Differentiation
 Feelings Dimensions
• Warmth
• Fun
• Excitement
• Security
• Social approval
• Self-respect
 Resonance Dimensions
• Behavioral loyalty
– Frequency and amount of repeat purchases

• Attitudinal attachment
– Love brand (favorite possessions; “a little pleasure”)
– Proud of brand

• Sense of community
– Kinship
– Affiliation

• Active engagement
– Seek information
– Join club
– Visit web site, chat rooms
 Positioning

is the act of designing the

company’s offering and
image to occupy a
distinctive place in the the
target market’s mind.
Product Differentiation

Conform-
Fea- Perfor-
Form Quality ance
tures mance
Quality

Dura- Relia- Repair-

Style Design
bility bility ability
 Services Differentiation

Ordering
Ordering Customer
Customer
Installation
Installation

Miscellaneous
Ease
Ease Consulting
Consulting

Services
Customer Maintenance
Customer Maintenance
Delivery
Delivery Training
Training &&Repair
Repair
Image Differentiation

Media Atmosphere

Symbols

Events
 Positioning Strategies
• Product Attributes

• Benefits, Problem Solutions & Basic Needs

• Price & Quality
• Specific Use
• Against Other Products
• Product User
• Against a Competitor
 Push-Pull Strategies
Producer’s Promotion Blend
Personal Selling, Sales Promotion, Advertising, Publicity

Promotion to
Channel Members
Wholesaler Wholesaler
Promotion Promotion
Business Customers

Push Push

Final Customers
Promotion to

Promotion to
Retailer
Promotion
Push

Business Final
Customer Consumer
Pull Pull
 A Model of Buyer Behavior
Marketing Mixes All Other Stimuli

Psychological Social Purchase

Variables Influence Situation
Motivation Family Purchase Reason
Perception Social Class Time
Learning Reference Groups Surroundings
Attitude Culture
Personality/Lifestyle

Person
Making
Decision
Problem-Solving Process

5-5 Person Does or Does Not Purchase (Response)

 The PSSP Hierarchy of Needs

Personal
Needs

Social Needs

Safety Needs

Physiological Needs

5-6
 The Consumer Problem Solving Process
Marketing mixes All other stimuli

Psychological Purchase
Social Influences Situation
Variables
Person making
decision
Need-want Awareness

Routinized Response
Information Search
Feedback of
information
Set Criteria as attitudes

Decide on Solution

Postpone Purchase Product

Decision Postpurchase
Evaluation
5-13
 Brand Positioning
• Define competitive frame of reference
– Target market
– Nature of competition

• Define desired brand knowledge

structures
– Points-of-parity
• necessary
• competitive
– Points-of-difference
• strong, favorable, and unique brand associations
 Issues in Implementing
Brand Positioning

• Establishing Category Membership

• Identifying & Choosing POP’s & POD’s
• Communicating & Establishing POP’s &
POD’s
• Sustaining & Evolving POD’s & POP’s
LIVING THE CORPORATE BRAND

Enacted
VISION Throug Staff Behaviour
h
Interact
CULTURE s
with
Stakeholder
Satisfaction
OBJECTIVES
CORPORATE
BRAND Interact
CONCEPT
BRANDSPHERE (Character) s
Systems with

Monitor then Revisit

To identify the gaps between actual and

intended brand promise
 BPS _The Cornerstone
• The brand positioning statement is the
single most important item in all of
marketing.

• It defines EVERYTHING about what your

brand is to the consumer.
 All Elements
• Packaging, Pricing, Distribution,
Manufacturing, Sales, Marketing….

• All work in unison to the beat of the brand

positioning statement.
 Three Elements
• Target Audience

• Compelling benefit

• Reason Why (Kitchen Logic)

 Brand
Positioning
Statement

For homemakers, Dow Bathroom Products are the

easy way to get a great clean shine for your tub, tile
and toilet. That’s because only Dow Bathroom
Products contain scrubbing bubbles that cut through
dirt and grime clean to the shine!
 Brand
Positioning
Statement

For those suffering from a cold, Comtrex offers four

different relief formulas that treat and work against
your specific cold ailments.
 Brand
Positioning
Statement

For single consumers ages 30+ who prefer upscale

fine-dining, Hormel offers four great meat entrees.
Major Challenges in Positioning
• Find compelling & impactful points-of-
difference (MacMillan & McGrath, HBR,
‘97)

– How do people become aware of their need for your product and
service?
– How do consumers find your offering?
– How do consumers make their final selection?
– How do consumers order and purchase your product or service?
– What happens when your product or service is delivered?
– How is your product installed?
– How is your product or service paid for?
 SERVICES BRANDING

• Challenges in Services Branding

• Intangibility
• Heterogeneity
• Inseparability
• Perishability
Goods Services Services Branding Implications

Tangible Intangible •Service brands cannot be patented

•Service brands cannot be inventoried
•Service brands cannot be readily displayed or
communicated
•Pricing service brands is difficult

Standardised Heterogeneous •Service brands face difficulties delivering on promises

•Service brand quality depends on many

uncontrollable factors

Inseparability Simultaneous •Customers participate in the service brand

production transaction
•Employees may affect the service brand outcome
•Customers may affect one another in the service
brand transaction
•Satisfaction of service brand is influenced by expected
and perceived behaviour of service provider and
customer
• Mass production of service brands is difficult
Non-perishable Perishable •Service brands face challenges to build and sustain
image and reputation to retain customers
•Fluctuating demand can cause problems for branding
services
THE SERVICES MARKETING
TRIANGLE

COMPANY

INTERNAL EXTERNAL
MARKETING MARKETING

EMPLOYEES CUSTOMERS
INTERACTIVE
MARKETING
 SERVICE BRANDING
MODELS

Aaker’s brand identity model: Proposed services branding model:

Brand as Brand as
Product Product(5P’s)

Brand as Brand as
Brand Organisation Brand Process

Brand as Brand as
Person Person

Brand as Brand as
Symbol Symbol
Brand as
Organisation
 MEASURING SERVICES
BRAND EQUITY
• Effectiveness
• Internal and external message alignment
• Consumer satisfaction
• Brand reputation
• Types of consumers
– Rational
– Political
– Emotional
– Spiritual
 A USEFUL DEFINITION

“Luxury is something you could do without

but that you don’t want to do without”
Coco Chanel
 EVOLVING CONCEPT OF
LUXURY

NEW SHOW LIFE POST

FIT IN
MONEY OFF STYLE MODERN

Adapted and expanded from Chadha & Husband

 SOME GENERAL
CHARACTERISTICS OF ASIA
• First of second generation of wealth for most
countries
• Social interaction more important than self-
actualization
• Luxury market recent, no established habits
• Opportunities to define new rules and emphasize
brands
• Models spread down to lower income levels
• Largest part of markets still in brand/price/status
rather than heritage/quality/experience
 Dominance of
European/Western Brands
• “Universality” of Western cultures?
• What leads to brand value?
• How can this change: two-way flow, fusion
or confusion?
 SOME CHALLENGES FOR
EUROPEAN BRANDS IN ASIA
(1/2)
• From powerful and visible brands to relevant and
credible brands
• New Luxury, confusion from profusion and the
need to cater for the affluent
• More important to know Who buys than Where
• A Luxury brand must be global, France and Italy
are small countries
 SOME CHALLENGES FOR
EUROPEAN BRANDS IN ASIA
(2/2)
• Appropriate retail capacity, stay in control
• Effective advertising
• Develop brand awareness and loyalty:
– Proliferation of magazines
– Events
• Educate staff, promote a culture of luxury:
– Heritage
– Quality
– Lifestyle
– Experience
 NEW LUXURY

• Focus on design
• Decline in costs, less exclusive on price but use codes of
luxury
• Transfer to cheaper labor costs
• Information widely available
• Brand “ambassadors”
 DEVELOPMENT OF LOCAL
BRANDS?
• Still very limited
• Luxury brands have to be global to be
appealing
• Cultural phenomenon
 THE NEW TERRITORIES OF
LUXURY
• Services
– From big smiles to service quality
• Real estate
• Hospitality

 This is where real Asian success stories

could be
Strategic Brand Management

• Strategic brand management involves the design and

implementation of marketing programs and activities
to build, measure, and manage brand equity.
• The strategic brand management process is defined
as involving four main steps:
1) Identifying and establishing brand positioning and values
2)  Planning and implementing brand marketing programs
3)  Measuring and interpreting brand performance
4)  Growing and sustaining brand equity
 Strategic Brand Management Process

STEPS KEY CONCEPTS

Mental maps
Identify and Establish Competitive frame of reference
Brand Positioning and Values Points-of-parity and points-of-difference
Core brand values
Brand mantra

Plan and Implement Mixing and matching of brand elements

Brand Marketing Programs Integrating brand marketing activities
Leveraging of secondary associations

Brand Value Chain

Measure and Interpret Brand audits
Brand Performance Brand tracking
Brand equity management system

Brand-product matrix
Grow and Sustain Brand portfolios and hierarchies
Brand Equity Brand expansion strategies
Brand reinforcement and revitalization
 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
Consumers are overloaded.

• They have a vast array of

alternatives
• Each product has many attributes
• Everyone is under time pressure
 The average supermarket
consumer:
• Does very little search: Average less than 12
second per item
• 42% spent 5 seconds or less
• 32% spent between 6 and 15 seconds
• Average number of brands handled: 1.21;
85% touched only one brand

Source: Pete Dickson and Stan Sawyer

Journal of Marketing
 How Do Consumers Cope?

• Choice has two phases

– Screening: Eliminate Alternatives
– Comparison: A small set of
alternatives (2-3) get intense scrutiny
 Screening is important
• Elimination occurs
because:
– The brand lacks a
feature (attribute)
– The brand does not
meet some cutoff
(price?)
• Once eliminated a
brand is not
reconsidered.
How Does Brand Equity Effect
Screening?
• Awareness: Can I recall this brand?

Imagine that your sewer is

backing up, and you are about
to leave town on a business trip.

Who do you call?

(Services rarely purchased must

have high Top-of-Mind)
How Does Brand Equity Effect
Screening?
• Awareness: Can I recall this brand?

More commonly, a harried or

uncertain consumer will
eliminate brands with which
they are unaware.
How Does Brand Equity Effect
Screening?

Image guides inference about the brand.

•
Inference substitutes for search because:
•
Search is expensive
–
Available information is irrelevant or tough to understand
–
What are your impressions of
this watch?
What are your impressions of
this watch?
 How Does Brand Equity Affect
Screening? A Strategic
Advantage
• Powerful brands can set the agenda:
– Dictate the attributes used for screening

• Examples:
– Volvo and Safety
– Crest with Tartar Control
– American Express Travelers Checks
 Screening: Summary
• Large product classes are screened.
• Elimination = Death
• Brand Equity influences screening
– Recall for the consideration set
– Inferences about product attributes
– Setting the agenda for screening

What Attributes are used for

screening in your product class?
 Overview

B r a n d E q u i t y a n
D e c i s i o n M a k i n

H o w C o S n t s a u g m e eS1 r :t s a g e I m 2 : p l i c
C o p e S c r e e n C i on mg p B a r r a i n dg
 Screening simplifies choice,
but does not do the whole
job.
• Even when screening consumers seem to
examine 2-3 alternatives much more carefully.
• Process involves intense comparisons on a
small set of attributes.
• How does this comparison process work?
 To create value…
• Brand must support a higher reference
price…
• Must maintain this over time, even in
the face of stiff competition…
• Applications:
– To raise price…
• New Models
• Price Bundling
• Etc…
 What Strategic Element
cannot be duplicated?
• You lower price, they can eventually
lower price
• You can add a feature, they can
eventually ad that feature
• But…

They cannot use your brand name!!

 Advantages of branding
• Easy for the seller to track down problems and
process orders
• Provide legal protection of unique product features
• Branding gives an opportunity to attract loyal and
profitable set of customers
• It helps to give a product category at different
segments, having separate bundle of benefits
• It helps build corporate image
• It minimises harm to company reputation if the
brand fails
 Brand parity
• Consumers buy from a set of acceptable/
preferred brands
 Umbrella Brand
• Products from different categories under
one brand
• Dangerous to the brand if the principal
brand fails
• Sometimes the company name is prefixed
to the brand. In such cases the company
name gives it legitimacy. The product
name individualises it.
 Naming the Brand
• Product benefits
• Product qualities
• Easy to pronounce
• Should be distinctive
• Should not have poor meanings in other
languages and countries
 Brand strategy
• Line extension – existing brand name extended
to new sizes in the existing product category
• Brand extension – brand name extended to new
product categories
• Multibrands – new brands in the same product
category
• New brands – new product in a different product
category
• Cobrands –brands bearing two or more well
known brand names
 Brand Repositioning
• This may be required after a few years to
face new competition and changing
customer preferences
 Packaging
• Includes the activities of designing and
producing the container for a product
• Packaging is done at three levels
- primary
- secondary
- shipping
 Packaging as a marketing tool
• Self service
• Consumer affluence
• Company and brand image
• innovation
 Designing packaging
• Packaging concepts
• Technical specifications
• Engineering tests
• Visual tests
• Dealer tests
• Consumer tests
• Packaging innovations
• Environmental considerations
 Labels
• Identification
• Grade classification
• Description of product
• Manufacturer identity
• Date of mfg., batch no.
• Instructions for use
• Promotion
 Labels as a marketing tool
• Labels need to change with time or
packaging changes to give it a
contemporary and fresh look
 Key Learning’s
• A brand is a living, breathing being.

• EVERYTHING COMMUNICATES!
– Packaging
– Product
– Price
– Advertising
– Word of Mouth
– Location
 Advertising is Losing
Effectiveness
• Too many ads promising benefits that aren’t
delivered -- creating increasing skepticism.

• Internet is proliferating this feeling among

consumers. Many think that the internet is a
scam waiting to happen.

• Market fragmentation.
 The Age of the
Self Reliant Consumer
• Less reliant on others
opinions and
recommendations.
Wants benefits, not
features. Stressed for
time.

• Tired of “data overload”.

Wants just enough
information to make an
informed decision and get
on with life.
 What Does It Mean?

To strike it rich,
you have to offer
consumers real,
meaningful benefits
that can
make your brand
stand out from the
crowd to be:
 First Law of Gravitational
Marketing

• BENEFITS:
A product is only as strong as the benefits
it provides to consumers.
 2nd Law of
Gravitational Marketing

REAL REASON TO BELIEVE –

You must convince the consumer of the
benefit and explain how you are going
to deliver it (the reason-to-believe).

Must use “Kitchen Logic”

 3rd Law of
Gravitational Marketing

DRAMATIC DIFFERENCE – The only

way to disrupt marketplace equilibrium
is to introduce a benefit-and-reason-to-
believe combination significantly
different from what already exists.
 Creating A Unique
Brand Identity
• Find a unique benefit.

• Exploit that benefit to create a

differentiation in the mind of the consumer.

• Convince the consumer that your brand is

Different, Better, Special.
 3 Parts For Building
Brand Identity
• Specify a target audience
• Determine your unique benefit
• Explain your REASON WHY
 Target Audience
• Who are you trying to sell to?
– Demographics / Psychographics
What kinds of customers do you
want to attract?

• What unique things describe them?

– Income level, Lifestyle, Priorities, Children, etc.
 Benefit
• What is it you’ll do for them?

• Is it unique?

• Functional benefits vs. Psychological

 Where To Look For
Unique Benefits

• Problems consumers have with the

product or category.

• Your Pet Peeves.

 Life Currencies

• Money
• Information
• Time
• Energy
• Space
• Fun
• Fear
 MY WORLD HEIRARCY
• My family & home.
• My job / income.
• My interests.
• People or things which can affect my family, home,
job / income, interests.
• My neighbors & community.
• My state.
• My country.
• The world at large.
 Passion Points

• The most successful brands and companies find

a unique benefits which touches a nerve in
consumers --- that evokes a strong consumer
reaction.

• If your brand can successfully resolve the issue

– you’ll win!
 Your Marketing Plan

• Purpose
– Define your core objectives, strategies and tactics in concise
summary
– Management selling tool for brand investment
– Document and sell or acknowledge results
– Provide solid, focused direction to corporation and brand support
– Define Brand evaluation objectives
– Live Working Document
 Brand Positioning:
The Cornerstone

• The brand strategy is the single most

important item in all of marketing.

• It defines EVERYTHING about what

your brand is to your consumer.
 Brand Development
Consumer Driven Marketing Cycle
Succeed And Map the
Improve Marketspace

Select Most
Assess
Valuable
Performance
Customers

Actions Strategies
Execute the Choose a
Tactical Plan Winning
Positioning
Tactics •Brand saturation
•High Cost
Define
Performance Create the
Build Tactical Plan
Measures
Operational
Mark Kerback, Kerback & Company
Capabilities
 Brand Development
Consumer Driven Marketing Cycle
Consumer Insight: Singularly
focused need, desire or want

Strategies: Fact Based choices Actions Strategies

on who, how and why

Tactics: Activities/capabilities •
Brand
–what, where and when Tactics
saturation
•High Cost
Actions: Execution, feedback,
assessment, and improvement Mark Kerback, Kerback & Company
 Measuring Brand Equity

Objective:
• To guarantee assets/liabilities are nurtured
and managed (loyalty, awareness, perceived
quality, propriety brand assets)
• Develop Focused Master Plan
• Create Long term Strategic Orientation
 Brand Marketing Process
Measure Brand Equity
Market &
Financial
Competitive
Health
Trends
Business
Analysis
Analysis & Long Term

Consumer
Marketing
Insights
Mix

SWOTs
Strategy

Strategic Implications & Strategy Development

Core Competencies, External Opportunities
Brand Vision
Brand Strategy
Strategic Role

Establish
Positioning
Concept

Three Year and ANNUAL Objectives

What do I want to Accomplish
Objectives Should be S.M.A.R.T
Annual Plan & Execution

ANNUAL STRATEGIES
How will the objectives be achieved?

Marketing Plan Execution

Market Physical Product
Package
Research

Consumer & Functional Objectives &

Pricing
Retailer Promo Strategies
And Tactical Plan
Public Advertising
Relations
Media
 Brand Marketing Process
Measure Brand Equity
Market &
Financial
Competitive
Term Strategy

Health
Trends
& Long Strategy

Business
Analysis Consumer
Marketing Insights
Mix

SWOTs
AnalysisTerm

Strategic Implications & Strategy Development

Analysis & Long

Core Competencies, External Opportunities

Brand Vision
Brand Strategy
Strategic Role

Establish
Positioning
Concept
 Establish
Positioning
Brand Marketing Process Concept

Three Year and ANNUAL Objectives

What do I want to Accomplish
Objectives Should be S.M.A.R.T

ANNUAL STRATEGIES
Annual Plan & Execution

How will the objectives be achieved?

Marketing Plan Execution

Market Physical Product
Package
Research

Consumer & Functional Objectives & Pricing

Retailer Promo Strategies
And Tactical Plan

Public Advertising
Relations
Media
 Brand Marketing Process
Measure Brand Equity
Market &
Financial
Competitive
Health
Trends
Business
Analysis
Analysis & Long Term

Consumer
Marketing
Insights
Mix

SWOTs
Strategy

Strategic Implications & Strategy Development

Core Competencies, External Opportunities
Brand Vision
Brand Strategy
Strategic Role

Establish
Positioning
Concept

Three Year and ANNUAL Objectives

What do I want to Accomplish
Objectives Should be S.M.A.R.T
Annual Plan & Execution

ANNUAL STRATEGIES
How will the objectives be achieved?

Marketing Plan Execution

Market Physical Product
Package
Research

Consumer & Functional Objectives &

Pricing
Retailer Promo Strategies
And Tactical Plan
Public Advertising
Relations
Media
 Measuring Brand Equity
Market Trends Checklist
•
Market Conditions
•Household Pentration
•Seasonality
•Regionality (CDI/BDI)

Retail Conditions
Volume & Share •Channels of Distribution
•Industry definition & served market •Product Sourcing/availability
•Category Size & growth rates •Importance of the category to the retailer
•Category Segmentation, trends, importance to category •Retailer focus on private label
•Share of market by brand & by segment •Retailer influence over category marketing
activity

Consumer
Conditions Government
•Substitute products Conditions
•Regulations & Reqs.
•Changes in
tastes/attitudes/needs •Legislative issues
 Measuring Brand Equity
• Assessing Competitive Trends
Competitor
Identification
• Key direct competitors
• Competitive Scope:
• Regional/National/Global

Competitor Focus Competitive Financials

•Importance in portfolio •P&L analysis
•Level of product activity Advantage •Cost Structure
•Level of marketing focus •Spending
•Financial resources •Profitability
Competitive Strategy
• Overall mission/priorities
• Target Audience
• Brand Turf/Positioning
• Class of Trade (COT) importance
 Brand Value Chain & Testing
• Use The Brand Value Chain to determine Measurement Tactics and
Resulting Marketing Strategies

Value Marketing Customer Market Shareholder

Stages Program Mindset Performance Value
Investment
-Product -Awareness -Price Premiums -Stock Price
-Communication -Associations -Price Elasticities -P/E Ratio
-Trade -Attitudes -Market Share -Market
-Employee -Attachment -Expansion Success Capitalization
-Other -Activity -Cost Structures
-Profitability
 Brand Value Chain & Testing
• Use The Brand Value Chain to determine
Measurement Tactics and Resulting Marketing
Strategies

Value Marketing Customer Market Shareholder

Stages Program Mindset Performance Value
Investment

Program Marketplace Investor

Multipliers Quality Conditions Sentiment
-Clarity
-Market Dynamics
-Relevance
-Competitive reactions -Growth Panel
-Distinctiveness
-Channel Support -Risk Profile
-Consistency
-Customer size & Profile -Brand Contributions
 Measuring Brand Equity
SWOT
• Purpose: to guide thinking and help distill the key issues and
opportunities facing the Brand AND the category
• Can be done in competitive analysis

STRENGTH WEAKNESS
Inherent source of competitive Inherent cause of competitive
advantage within the Brand (of disadvantage within the Brand (of
genuine relevance to the consumer) genuine importance to consumer)

INTERNAL to the brand

Caused by the inherent nature of the Brand or our
management of it
 Measuring Brand Equity
SWOT
• Purpose: to guide thinking and help distill the key issues and
opportunities facing the Brand AND the category
• Can be done in competitive analysis

EXTERNAL to the brand

Markets, competitors, retail, social trends etc

OPPORTUNITY
Unsatisfied or poorly satisfied need
in the marketplace which our
company can perform profitability
THREAT
Potential problem from external source
which could undermine our Brand’s
competitive position if not addressed.
Consumer-Based Brand Equity
Pyramid
THIS is
Where the

Consumer Acceptance Cycle

Insight
Lives Consumer- 4 Intense, Active Loyalty
Brand
Resonance

Consumer Consumer 3 Positive Accessible Reactions

Judgments Feelings

Brand Brand 2 Points of Difference

Performance Imagery

Brand Salience 1 Deep Broad Brand Awareness

 Consumer-Based Brand Equity
Pyramid

Loyalty
Attachment 4 Brand Relationships (WHAT About
Resonance Community You AND ME?)
Engagement

Quality Warmth, Fun Feelings

Credibility Excitement,
Judgments Consideration Security, Social 3 Brand Response (WHAT About You?)
Superiority Approval,
Self-Respect

Performance
Brand Characteristics
& Secondary Features
User Profiles Imagery
Purchase and Usage
Product Reliability,
Situations
Durability & Serviceability 2 Brand Meaning (WHAT Are You?)
Service Effectiveness, Efficiency, Personality & Values
& Empathy History, Heritage, &
Style and Design; Price Experiences
Category Identification
Needs Satisfied 1 Brand Identity (WHO Are You?)

Salience
 Some Brand Equity Models -
Brand Asset Valuator (Young and
Rubicam)
• Energized brand – Differentiation (brand seen
as different from others)
strength (brand’s – Energy – brand’s sense of
future value) momentum
– Relevance – breadth of the
brand’s appeal

– Esteem – How well the

brand is regarded and
• Brand’s Stature respected
(brand’s report card – Knowledge

on past performance)
 Some Brand Equity Models -
Brandz (Millerward Borwn and WPP)
Strong relationship /
High share of category
expenditure

Nothing else beats it Bonding

Does it offer something
better than others? Advantage
Can it deliver? Performance
Does it offer me
something?
Relevance
Do I know about it? Presence
Weak relationship /
Low share of category
expenditure
 Some Brand Equity Models -
Aaker
• Brand awareness + Brand loyalty + Brand associations
• Developing a brand identity, i.e. the unique set of
associations that represent what the brand stands for
and promises to customers
– Product scope
– Product attributes
– Quality/value
– Users
– Country of origin
– Organizational attributes
– Brand personality
– Brand symbols
 Components of brand value
• Reputation Value
– Signaling quality and reliability
• Relationship Value
– Signals firm can be trusted and flexible long-
term partner
• Experiential Value
– Brands as perceptual frame that highlights
particular benefits delivered by the product
• Symbolic Value
– Brands act as symbols that express values and
identities (e.g. group membership)
The Brand Report Card (Keller)
1. Delivers benefits customers desire
2. Stays relevant, modified to fit the times
3. Is priced based on consumers’ perceptions of
the brand’s value
4. Is properly positioned
clearly communicates its similarities and
differences from competing brands
1. Is consistent
marketing communications don’t send
conflicting messages over time
The Brand Report Card (Keller)
6. Fits sensibly into your brand portfolio
Brands work logically together
6. Has integrated marketing strategy
7. Has meanings that managers understand
8. Receives sustained support
Companies consistently invest in building and
maintaining brand awareness
6. Is constantly monitored
Formal brand-equity-measurement system
 Brand Extensions
• Advantages
– Improved odds of product-success
• Consumers make inferences and form
expectations based on
– what they already know about the parent brand
– Extent to which they feel this information is relevant for the new
product
• Reduced risk
• May be easier to convince retailers
• Reduced costs
• Packaging and labeling efficiencies
• Positive Feedback Effects to Initial Brand
 Brand Extensions
• Disadvantages
– Brand dilution
• May question brand integrity or become confused
or frustrated
– Extension may fail and hurt the parent brand
– Cannibalization – intrabrand shift in sales
– Firm forgoes the change to create a new
brand with its own unique image and equity
(e.g. Levi’s Dockers)
 Insight to Positioning
State the thought you wish to
implant in your target’s
mind:
• TO (core target audience),
(Brand Name), Power
Positioning
• IS THE (frame of reference) LINKS to
• THAT (owned benefit) Consumer Insight

• BECAUSE (support or
reason to believe)
 Branding strategy
• Branding strategy is critical because it is
the means by which the firm can help
consumers understand its products and
services and organize them in their minds.
• Two important strategic tools: The brand-
product matrix and the brand hierarchy
help to characterize and formulate
branding strategies by defining various
relationships among brands and products.

11.209
 Branding Strategy or Brand
Architecture
• The branding strategy for a firm reflects the
number and nature of common or
distinctive brand elements applied to the
different products sold by the firm.
– Which brand elements can be applied to which
products and the nature of new and existing
brand elements to be applied to new products

11.210
 The role of Brand Architecture
• Clarify: brand awareness
– Improve consumer understanding and
communicate similarity and differences
between individual products
• Motivate: brand image
– Maximize transfer of equity to/from the brand
to individual products to improve trial and
repeat purchase
 Brand-Product Matrix
Products
1 2 3 4
A
Brands B
C

• Must define:
– Brand-Product relationships (rows)
• Line and category extensions
– Product-Brand relationships (columns)
• Brand portfolio
Ford Brand Portfolio
 Brand Hierarchy Tree: Toyota
Toyota
Corporation

Toyota Toyota Toyota Toyota Lexus

(Trucks) (SUV/vans) (Cars) Financial
Services

Corolla MR2
Camry Avalon Celica ECHO Matrix Prius
Spyder
Platinum
CE SE Edition
S LE XL SE
LE XLE XLS SLE
 Designing a Brand Portfolio
• Basic principles:
– Maximize market coverage so that no
potential customers are being ignored
– Minimize brand overlap so that brands aren’t
competing among themselves to gain the
same customer’s approval
 Brand Roles in the Portfolio
• Flankers
• Cash cows
• Low-end entry-level
• High-end prestige brands
 Brand Hierarchy
• A means of summarizing the branding
strategy by displaying the number and
nature of common and distinctive brand
elements across the firm’s products,
revealing the explicit ordering of brand
elements
• A useful means of graphically portraying a
firm’s branding strategy
Brand Hierarchy Levels

Corporate Brand (General Motors)

Family Brand (Maggi)

Individual Brand (Park Avenue)

Modifier: Item or Model (Ultra)

 Corporate Brand Equity

• Occurs when relevant constituents hold

strong, favorable, and unique associations
about the corporate brand in memory
• Encompasses a much wider range of
associations than a product brand
 Family Brands
• Brands applied across a range of product
categories
• An efficient means to link common
associations to multiple but distinct
products
 Individual Brands
• Restricted to essentially one product
category
• There may be multiple product types
offered on the basis of different models,
package sizes, flavors, etc.
 Corporate Image Dimensions
• Corporate product attributes, benefits or attitudes
– Quality
– Innovativeness
• People and relationships
– Customer orientation
• Values and programs
– Concern with the environment
– Social responsibility
• Corporate credibility
– Expertise
– Trustworthiness
– Likability
 Brand Hierarchy Decisions
• The number of levels of the hierarchy to
use in general
• How brand elements from different levels
of the hierarchy are combined, if at all, for
any one particular product
• How any one brand element is linked, if at
all, to multiple products
• Desired brand awareness and image at
each level
 Number of Hierarchy Levels
• Principle of simplicity
– Employ as few levels as possible
• Principle of clarity
– Logic and relationship of all brand elements
employed must be obvious and transparent
 Levels of Awareness and Associations
• Principle of relevance
– Create global associations that are relevant
across as many individual items as possible
• Principle of differentiation
– Differentiate individual items and brands
 Linking Brands at Different Levels

• Principle of prominence
– The relative prominence of brand elements
affects perceptions of product distance and the
type of image created for new products
 Linking Brands Across Products

• Principle of commonality
– The more common elements shared by
products, the stronger the linkages
 Brand Architecture Guidelines
• Adopt a strong customer focus
• Avoid over-branding
• Establish rules and conventions and be
disciplined
• Create broad, robust brand platforms
• Selectively employ sub-brands as means of
complementing and strengthening brands
• Selectively extend brands to establish new
brand equity and enhance existing brand
equity
 Corporate Brand Campaign
• Different objectives are possible:
– Build awareness of the company and the nature of its
business
– Create favorable attitudes and perceptions of company
credibility
– Link beliefs that can be leveraged by product-specific
marketing
– Make a favorable impression on the financial
community
– Motivate present employees and attract better recruits
– Influence public opinion on issues
 Using Cause Marketing to Build
Brand Equity
• The process of formulating and
implementing marketing activities that are
characterized by an offer from the firm to
contribute a specified amount to a
designated cause when customers engage
in revenue-providing exchanges that satisfy
organizational and individual objectives
 Advantages of Cause Marketing
• Building brand awareness
• Enhancing brand image
• Establishing brand credibility
• Evoking brand feelings
• Creating a sense of brand community
• Eliciting brand engagement
 Green Marketing
• A special case of cause marketing that is
particularly concerned with the
environment
• Explosion of environmentally friendly
products and marketing programs
 Crisis Marketing Guidelines
• The two keys to effectively managing a
crisis are that the firm’s response should
be swift and that it should be sincere.
 Product-Line Decisions

• Product-Line Analysis
• Product-Line Length
• Product-Line Modernization, Featuring,
and Pruning
 Brand Decisions
• The AMA definition of a brand:
“A name, term, sign, symbol, or design,
or a combination of these, intended to
identify the goods or services of one
seller or group of sellers and to
differentiate them from the competition.”
 Brand Decisions

• Brands can convey six levels of meaning:

– Attributes
– Benefits
– Values
– Culture
– Personality
– User
 Brand Decisions

• Brand identity decisions include:

– Name
– Logo
– Colors
– Tagline
– Symbol
• Consumer experiences create brand bonding,
brand advertising does not.
 Brand Decisions

• Marketers should attempt to create or facilitate

awareness, acceptability, preference, and
loyalty among consumers.
• Valuable and powerful brands enjoy high levels
of brand loyalty.
 Brand Decisions

• Aaker identified five levels of customer

attitudes toward brands:
– Will change brands, especially for price. No brand
loyalty.
– Satisfied -- has no reason to change.
– Satisfied -- switching would incur costs.
– Values brand, sees it as a friend.
– Devoted to the brand.
 Brand Decisions

• Brand equity refers to the positive differential

effect that a brand name has on customers.
• Brand equity:
– is related to many factors.
– allows for reduced marketing costs.
– is a major contributor to customer equity.
 Brand Decisions

• Advantages of branding:
Key Challenges – Facilitates order processing
– Trademark protection
• To brand or not – Aids in segmentation
• Brand sponsor – Enhances corporate image
• Brand name – Branded goods are desired
by retailers and distributors
• Brand strategy
• Brand repositioning
 Brand Decisions

Key Challenges • Options include:

– Manufacturer (national)
• To brand or not brand
• Brand sponsor – Distributor (reseller,
store, house, private)
• Brand name brand
• Brand strategy – Licensing the brand
• Brand repositioning name
 Brand Decisions

• Strong brand names:

Key Challenges – Suggest benefits
– Suggest product qualities
• To brand or not – Are easy to say, recognize,
• Brand sponsor and remember
• Brand name – Are distinctive
– Should not carry poor
• Brand strategy meanings in other
• Brand repositioning languages
 Brand Decisions

• Varies by type of brand

Key Challenges – Functional brands
– Image brands
• To brand or not – Experiential brands
• Brand sponsor • Line extensions
• Brand name • Brand extensions
• Brand strategy • Multibrands
• New brands
• Brand repositioning
• Co-branding
 Brand Decisions

• A brand report card can

Key Challenges be used to audit a brand’s
strengths and
• To brand or not weaknesses.
• Brand sponsor • Changes in preferences
• Brand name or the presence of a new
• Brand strategy competitor may indicate a
need for brand
• Brand repositioning repositioning.
 Packaging and Labeling
• Packaging includes:
– The primary package
– The secondary package
– The shipping package
• Many factors have influenced the
increased use of packaging as a
marketing tool.
 Packaging and Labeling
• Developing an effective package:
– Determine the packaging concept
– Determine key package elements
– Testing:
• Engineering tests
• Visual tests
• Dealer tests
• Consumer tests
 Packaging and Labeling
• Labeling functions:
– Identifies the product or brand
– May identify product grade
– May describe the product
– May promote the product
• Legal restrictions impact packaging for
many products.
 Customer-based brand equity
• Differential effect that brand knowledge has on
consumer response to the marketing of that brand
– Improved perceptions of product performance
– Greater loyalty
– Less vulnerability to marketing crises
– Larger margins
– More inelastic consumer response to price increases
– More elastic response to price decreases
– Greater trade cooperation and support
– Increased marketing communications effectiveness
– Possible licensing opportunities
– Additional brand extension opportunities.
 Brand Health
• Brand associations determine customer satisfaction
– Leadership - availability of brand, its reputation and
points of presence
– Liabilities – vulnerabilities, or negative associations
– Attractiveness – positive associations with brand
– Distinctiveness – perceived relevance of brand
• Satisfaction drives performance
 Key Factors That Influence Price Setting
Pricing
objectives
Price of other
Price flexibility
products in the line

Discounts and
Demand allowances
Price
settin
g
Cost Legal
environment

Geographic
Competition
pricing terms
Markup chain
in channels

17-
 Strategic Pricing Options

Reverse
Cost-Plus
Variations POS
in Value

Price Successful Competitor

Sensitivity Pricing Reaction

Customer
Emotion
Costs
Individual?
Bundled?
 Pricing Objectives
Target
Return
Profit
Oriented Maximize
Profits

Dollar or Unit
Sales Growth
Pricing Sales
Objectives Oriented Growth in
Market Share

Meeting
Competition
Status Quo
Oriented Nonprice
Competition
 Strategy Planning for Price
Target
Market

Product Place Promotion Price

Pricing
objectives

Geographic
Discounts and
Price levels term —
Price allowances—
over product who pays
flexibility to whom and
life cycle transportation
when
and how
 Distribution Options*

Direct Intermediary
Salesforce
•Internet •Franchise
•Telephone •Own •Wholesaler
•Mail •Another firm’s •Agent/Merchant
•Catalogue •Contract •Distributor
•Own channel •Partner

*More limited for services

The Transporting Function

Truck
Rail
Modes
of
Transportation

Air
Pipeline

Water
 Types of Retailers
Expanded
Specialty shops and
assortment department stores
and service

Expanded
assortment Supermarkets, discount
houses, mass-merchandisers,
Single- and/or reduced supercenters
Conven- and margins/service
tional limited-
offerings line
Added Telephone/mail order,
stores
convenience vending machines,
higher margins door-to-door, convenience
less assortment stores, electronic shopping

Expanded
assortment Internet
reduced margins
more information
 Four Examples of Basic Channels of
Distribution for Consumer Products
Manufacturer or producer

Del Procter &

Citibank Nissan
Monte Gamble

Wholesaler Wholesaler

Wholesaler

Retailer Retailer Retailer

Consumer
Price and Distribution Strategies

Market Leader
•Distribution in place Market Challenger
•Price main weapon •Focus on flanks
•Premium price •Direct or indirect attack
•Variety of options

Market Niche
Market Follower •Stay with markets
•‘Cloning’ •Add niches
•Set lower prices •Premium price
•Selective distribution
 PERCEPTION
• Perception is
subjective—
approximation of
reality
• More information is
available than can be
processed
• “Perceptual guards”
Alteration of Images for Optimal
Perceived Stimulus

Photoshop
manipulation
enhancing
eyes

http://www.jasc.com/support/learn/tutorials/archive/paintshoppro/eyeenhancement.asp?pg=1
 Information Processing for
Consumer Decision Making
EXPOSURE
Random______________Deliberate
PERCEPTION

ATTENTION
Low involvement—High Involvement

Text, p. 278
INTERPRETATION
Low involvement—High Involvement

MEMORY
Short term____________Long Term

PURCHASE /CONSUMPTION
DECISIONS
 Exposure, Attention, and
Perception
• What is necessary to reach consumers?
– Exposure (e.g., consumer must see your
billboard)
– Attention (e.g., consumer must look at ad
message)
– Perception (e.g., consumer must “take in”
message)
 The Senses
• Vision
– Influence of colors
– Priority of attention
• Smell
– Strong affective impact; associations in
memory
• Hearing
– Priority of attention
– Habituation
 More Senses
• Touch
– Affective impact
• Taste
– Acquired tastes
– Influence of smell
 Definition
Exposure: the process
by which the
consumer comes in
physical contact with
a stimulus.
 Sensing Change
(Perceptual Thresholds)
• “Downsizing” of
products
• Reducing alcohol
content of beverages
• Weber’s Law—larger
change is needed in a
strong stimulus before
it can be detected
Subliminal Perception: A
Diabolical Marketing Tool?
• Subliminal messages
in ads are illegal in
U.S.
• Some research
support for modest
effects
 How Do You Gain Exposure?
• Research target
group habits
• “Hidden” product
placements
• Computer screen
savers
• Point-of-purchase
displays
 Selective Exposure
• How much attention are you
likely to give to the following
advertising encounters?
– radio ad while driving
– ad in newspaper or magazine
– freeway billboard
– direct mail appeal
 How Can We Increase
Consumers’ Exposure?
• “Roadblocking”--you
can run, but you can’t
hide!
• Repetition
• Wide presence
 Properties of Attention
• Selective
• Capable of being
divided
• Limited
Some Determinants of Attention
Given to Stimuli
• Self-relevance
• Movement (animation)
• Position
• Isolation
• Format 3 7
• Pleasantness
• Surprisingness
= 81
• Contrast
9 6
• Information quality
• Interestingness
• Ease of processing
 Color, Movement, and Position
• Color • Position
– Brighter colors are
likely to get more
attention
– Preference for color
• Movement
– Attention to moving
object is evolutionarily
adaptive
– Placement relative to
the viewer’s visual field
– Objects closer to
center are more likely
to be seen
• Eye level shelf space is
preferred
– Right hand ads tend to
receive more attention
than those at left
– Gaze Motion Theory
 Isolation and Format
• Isolation • Format
– Fewer competing – The way a message is
stimuli organized
– Use of “white space” – Simpler layouts tend to
get more attention
(less effort required)
 Contrast/Expectations
• More attention given to a stimulus which
does not “blend in” to the background
• Stimuli with unexpected content tend to
receive more attention (prioritized as
potentially important information)
• Adaptation Level Theory—stimuli will
eventually be less unexpected based on
prior experience
 Interestingness and Info
Quantity
• Interestingness • Info Quantity
– Interest motivates – Information overload
allocation of attention • Difficult to cope with
– Intense competition for excessive information
interest – Better organized
information is more
useful
 Self-Relevance
• Needs, values, and goals
• Similarity of source
• Dramas
• Rhetorical questions
 Pleasantness of Stimuli
• Attractive visuals
• Music
• Humor
Surprisingness of Stimuli
• Novelty
• Unexpectedness
 Ease of Processing
• Prominence
• Concreteness
• Contrast
 Interpretation
• Meanings assigned to stimuli
– Often highly culturally influenced based on
expectations
– Cognitive interpretation and categorization
• Categories as a way to simplify the world
– Social/linguistic categories
– Ad hoc categories
• Prototypes and “perfect” examplars
– Superordinate (e.g., “furniture”), basic (e.g., “chair”), and
subordinate (e.g., “office chair”).
Perception and Marketing Strategy
• Retail • Media strategy
– Allocation of retail – Product category vs.
shelf space involvement
• High volume items • Advertisements and
• Category allotment
Package Design
– Point-of-purchase
– Use of humor—
displays
attention to the humor
• Brand name/logo vs. the product
development
– Brand associations
– Visual images
 Advertising Evaluation
• Exposure • Interpretation
– People meters – Focus groups
– Web site visits/”hits” – Projective research
– Click-through rates • Memory
• Attention – Brand awareness levels
– Day after recall
– “Starch” scores based on
attention given to
advertising parts
• “Noted”
• “Seen-associated”
• “Read most”
 Ambush Marketing
• Attempt to associate brand with a non-
owned entity
– E.g.,
• Advertising for the use of one brand of film at the
Olympics when another brand is the official
sponsor
• Sponsoring a small part of the event
• Advertising during the event
 Reinforcing Brands
• Generally, we reinforce brand equity by
marketing actions that consistently convey
the meaning of the brand to consumers in
terms of brand awareness and brand
image.

13.286
 Managing Brands over Time

• Effective brand management requires

taking a long-term view of marketing
decisions
– Any action that a firm takes as part of its
marketing program has the potential to change
consumer knowledge about the brand.
– These changes in consumer brand knowledge
from current marketing activity also will have
an indirect effect on the success of future
marketing activities.
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 Consumer response to
past marketing activities

Brand awareness and brand image

Consumer response to
current marketing activities

Changed brand awareness and brand image

Consumer response to
future marketing activities
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 Reinforcing Brands
• Maintaining brand consistency
– Consistent marketing support in amount and
nature
• Protecting sources of brand equity
• Fortifying versus leveraging
– Trade-off
• Fine-tuning the supporting marketing
program

13.289
 Consistency in
amount and nature
Brand Awareness
of marketing
support
•What products does the brand represent?
•What benefits does it supply? Innovation in product
•What needs does it satisfy? design, manufacturing
and merchandising Continuity in brand
Brand meaning; changes in
Reinforcement marketing tactics
Strategies
Brand Image
Relevance in user Protecting sources
•How does the brand make products superior? of brand equity
•What strong, favorable, and unique brand and usage imagery
associations exist in customers’ minds?
Trading off
marketing
activities to
fortify vs.
leverage brand
equity

13.290
 Revitalizing Brands

• Expand the depth and/or breadth of awareness

by improving consumer recall and recognition of
the brand during purchase or consumption
settings

• Improve the strength, favorability, and

uniqueness of brand associations—either
existing or new—making up the brand image

13.291
 Increase quantity
of consumption Identify additional
Expand depth and (how much) opportunities to
Breadth of awareness
use Brand in Same
And usage of brand
Increase frequency basic way
of consumption
Refresh old sources (how often) Identify completely
Brand Of brand equity new and different
Revitalization ways to use
Strategies
Create new sources
Of brand equity

Retain vulnerable
Bolster fading associations customers
Improve strength,
favorability, and Recapture lost
Neutralize negative
uniqueness of brand customers
associations
associations
Identify neglected
Create new associations segments

Attract new
customers

13.292
 Strategies to Revitalize Brands
• Expanding brand awareness
– Breadth challenge
• Improving brand image
– Repositioning the brand
– Changing brand elements
• Entering new markets

13.293
 Expanding Brand Awareness
• Increasing usage
– Increasing the level or quantity of consumption
– Increasing the frequency of consumption

• Identifying new or additional usage

opportunities
– Communicate appropriateness of more frequent
use in current situations
– Reminders to use

• Identifying new and completely different ways

to use the brand
13.294
 Improving the Brand Image
• Repositioning the brand
– Establish more compelling points of difference
– In some cases, a key point of difference may turn
out to be nostalgia and heritage rather than any
product-related difference.
– Other times we need to reposition a brand to
establish a point of parity on some key image
dimension.
• Changing brand elements
– Convey new information or signal that the brand
has taken on new meaning

13.295
 Improving the Brand Image
• Go “back to basics” and tap into existing
sources of brand equity (e.g., Harley-
Davidson)
– Product strategy
– Pricing strategy
– Channel strategy
– Communication strategy

• Create new sources of brand equity (e.g.,

Mountain Dew)
13.296
 Entering New Markets
• One strategic option for revitalizing a
fading brand is simply to more or less
abandon the consumer group that
supported the brand in the past to target
a completely new market segment.

13.297
 Adjustments to Brand Portfolio
• Migration strategies
– A corporate or family branding strategy in which brands are
ordered in a logical manner could provide the hierarchical
structure in consumers’ minds to facilitate brand migration.
– Example: BMW with its 3-, 5-, and 7-series numbering systems
• Acquiring new customers
– Tradeoffs in their marketing efforts between attracting new
customers and retaining existing ones
– Firms must proactively develop strategies to attract new
customers, especially younger ones.
• Retiring brands

13.298