Chapter 9 Creating Brand Equity

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Chapter 9Creating Brand Equity

Philip KotlerKevin Lane Keller

Donna Sia, Shelle Caiga, Rhea JardinMay 4, 2012

1. What is brand and how does branding work?

2. What is brand equity?3. How is brand equity built, measured and

managed?4. What are the important decisions in

developing a branding strategy?

Outline:

What do we have to know?

Brand is a “name, term, sign, symbol, or design or combination of then, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.”

What is brand?

Branding is endowing products and services with the power of a brand.

It creates mental structures that help consumers organize their knowledge about products and services in a way

that clarifies their decision making and, in the process, provides value to the

chain.

How does branding work?

Brand equity is the added value endowed on products and services.

It may be reflected in the way consumers think, feel and act with respect to the

brand, as well as in the prices, market share and profitability the brand commands for

the firm.

What is Brand Equity?

Outline:

Like playing basketball, managing a brand involves strategies…

Brand Positioning

Brand Marketing

Brand Performance

Brand Value

Step 1. Identify and establish

Step 2. Plan and implement

Step 3. Measure and interpret

Step 4. Grow and sustain

What can branding do to your business?

Identifies the maker & signifies quality

Offers legal protectionServes as competitive advantage

Creates barriers to entry

Organizes accounting and simplifies product handling

Secures price premium

Loyola SchoolsAGSBSchool of LawSchool of Medicine

Provide customers the right type of experience to create desired brand knowledge.

Hi, I’m Jersey 17, I am passionate and I try to be the best at what I do especially

basketball.

Jersey 17’s Brand Print

What is important to me is to give my

fans a good game and give my best for

the team.

Even though I am busy with my career, I was still

able to finish my education & start my own

business

I hope I inspire young athletes to

pursue their dreams, whatever sport they

are into.

Images

Feelings

Thoughts & Beliefs

What STRONG brands do…

Improved perceptions of product performance

Greater Loyalty

Large Margins

Less vulnerability to competitive marketing actionsMore inelastic consumer responseIncreased marketing communications effectiveness

Brand Asset Evaluator (BAV) compares brand equity of thousands of brands across hundreds of categories and these are its four pillars (Derek)

One comparative measure of brand equity is the BAV

Brand Equity

Brand Essence

Core Identity

Develop your brand’s identity.

Aaker Model

Brand Essence:Movement for self-esteem

Campaign for real beautyEmpowering

Develop your brand’s identity by:

Aaker Model

Brand Essence:

Movement for self-esteem

Campaign for real beauty

Extended Identity:

Dove Men + Care

Aaker Model

Brand Essence:

Extended Identity:

Dove Men + CareCore

Identity:Beautiful

SkinAaker Model

Bonding

Advantage

Performance

Relevance

Presence

Brand building follows a sequential series of steps:

Strong relationshipHigh share of category expenditure

Weak relationship/Low share of categoryexpenditure

Brand Dynamics Pyramid

Building relationship with a brand…

Do I know about it?

PresencePresence

Does it offer me something?

Presence

Relevance

Can it deliver?

Presence

Relevance

Performance

Advantage

Bonding

Does it offer something better than others?

Presence

Relevance

Performance

Advantage

Bonding

Nothing else beats it!

Presence

Relevance

Performance

Advantage

Bonding

Brand Resonance Pyramid

Presence

Performance & Imagery

Judgment & Feelings

Resonance

Brand Salience

Brand Elements

What drives brand equity?

Men and Women for others…The Ateneo Way…

Memorable

Like the person of your dreams, brand elements should be…

Meaningful

Likeable

Transferable?

Adaptable

Protectible

Marketing Activities

Meaning Transference

Mirrors your brand

Designing Holistic Marketing Activities

Brands are not built by advertising alone.

Personalize Integrate Internalize

Brand Audits

Measuring Brand Equity

Brand-Tracking

Brand Valuation

Health of brandSource of brand equityWays to improve equity

Where, how much & what ways brand value is being created?

Financial Value of the brand

In summary:

Images

Feelings

Thoughts & Beliefs

RelationshipBrand Consumer

Brand Elements

Presence

Relevance

Performance

Advantage

Bonding

Presence

Marketing Activities and Meaning Transference

The company

Brand Valuation

CREATING BRAND EQUITY

MARKMA

Rhea G. Jardin

May 4, 2012

Donna Sia, Shelle Caiga, Rhea JardinMay 4, 2012

A product or service whose dimensions differentiate it in some way from other products or services designed to satisfy the same need

What is a Brand?

Differences maybe related to:A. Product performance of the brand1. Functional - 2. Rational - 3. Tangible

B. What the brand represents4. Symbolic5. Emotional 6. Intangible

1. Identify the source or maker of the product that satisfies the consumers’ needs

2. Simplifies product handling or tracing

3. Offers firm legal protection with intellectual property rights

4. Signals level of quality so that buyers can easily choose the product again

Role of Brands

- Endowing products and services with the power of the brand by creating differences between products

- “who” the product is, what the product does and why consumers should care

What is Branding?

- the added value on products and services

- reflected on how consumers think, feel and act on the brand

- reflected in the prices, market share and profitability for the firm

Brand Equity

A. Positive – customers react more favorably to a product and the way it is marketed

B. Negative – customers react less favorably to marketing activity for the brand

Three (3) key ingredients:1. Consumer response2. Consumer’s knowledge about the brand3. Consumer’s perceptions, preferences and

behavior

Customer-based brand equity

1. Quality is the critical factor not the quantity

2. Dictates future directions for the brand based on how consumers think and feel about the brand

Brand promise - the marketer’s vision of what the brand must be and do for consumers

Brand Knowledge

1. Differentiation – measures the degree to which a brand is seen as different from others

2. Energy – measures the brand’s sense of momentum 3. Relevance – measures the breadth of a brand’s appeal

4. Esteem – measures how well the brand is regarded and respected5. Knowledge – measures how familiar and intimate consumers are with the brand

Five pillars of brand equity

+ + = energized brand strength

- point to the brand’s future value + = brand stature

- “report card” of past performance

“Pillar’s pattern” reveal a brand’s current and future status

Five pillars of brand equity

BrandDynamics Pyramid

-Developed by Millward Brown of BRANDZ Marketing as a model of brand strength

Nothing else beats it Does it offer something better than the others? Can it deliver?

Does it offer me something? Do I know about it?

Bonding

Advantage

Performance

Relevance

Presence

BrandDynamics Pyramid

-Developed by Millward Brown of BRANDZ Marketing as a model of brand strength

Nothing else beats it Strong relationship / High

Does it offer something share of category expenditure

better than the others? Can it deliver?

Does it offer me something? Do I know Weak relationship /

about it? Low share of category expenditure

Bonding

Advantage

Performance

Relevance

Presence

Brand Resonance ModelStages of Brand Brand Brand building Branding objective at Development blocks each stage

4. Relationships = what about you and me?

3. Response = what about you?

2. Meaning = what are you?

1. Identity = who are you?

Intense, active loyalty

Positive, accessible reactions

Points-of-parity & difference

Deep, broad brand

awareness

Resonance

Judgments

Feelings

Performance Imagery

Salience

Brand salience – how often and how easily customers think of the brand under various purchase or consumption situations

Brand performance – how well the product or service meets customers’ functional needs

Brand imagery – the ways in which brand attempts to meet customers’ psychological or social needs

Brand judgments – focus on customers’ own personal opinions and evaluations

Brand feelings – customers’ emotional responses and reactions with respect to the brand

Brand resonance – nature of the relationship customers have with the brand (“in sync” with it)

Brand Resonance Model

1. Initial choices for the brand elements or identities making up the brand

2. The way the brand is integrated into the supporting marketing program

3. The associations indirectly transferred to the brand by linking the brand to some other entity

Brand equity drivers

1. Memorable – how easily the brand element is recalled and recognized (i.e. short names)

2. Meaningful – credibility of the brand, product ingredient or type of person who might use the brand

3. Likeable – how visually and verbally appealing is the brand element

4. Transferable – can the brand element be used to introduce new products in the same or different categories?

Brand element choice criteria

5. Adaptable – how adaptable and updatable is the brand element

Betty Crocker in 1936 Betty Crocker in 1986

6. Protectible – brand names that become synonymous with product categories

Brand element choice criteria

1. Brand audit - measures “where the brand has been”

2. Brand-tracking studies – measure “where the brand is now” and whether marketing programs are having the intended effects

Measuring brand equity

Brand valuation – estimating the total financial value of the brand

Measuring brand equity

Rank Brand 2006 Brand Value (Billions)

1 Coca-cola $67.00

2 Microsoft $56.93

3 IBM $56.20

4 GE $48.91

5 Intel $38.32

6 Nokia $30.13

7 Toyota $27.94

8 Disney $27.85

9 McDonald’s $27.50

10 Mercedes-Benz $22.13

1. Brand reinforcement - requires innovation and relevance throughout the marketing program

- brand must be moving forward in the right direction with new offerings and ways to market them

2. Brand revitalization - reinvention strategy

- renewal of commitment to quality

Managing brand equity

reflected on where

customers price market share profitability quality is a factor over quantity

Pillars of brand equity:

differentiation energy relevance esteem knowledge

energized brand strength brand stature criteria for brand element:

memorable/short meaningful likeable transferrable

adaptable protectible

Brand Equity

CREATING BRAND EQUITY

MARKMA

Rhea G. Jardin

May 4, 2012

Donna SiaMay 4, 2012

1. What is brand and how does branding work?

2. What is brand equity?3. How is brand equity built, measured and

managed?4. What are the important decisions in

developing a branding strategy?

Outline:

What do we have to know?

Brand is a “name, term, sign, symbol, or design or combination of then, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.”

What is brand?

Branding is endowing products and services with the power of a brand.

It creates mental structures that help consumers organize their knowledge about products and services in a way

that clarifies their decision making and, in the process, provides value to the

chain.

How does branding work?

Brand equity is the added value endowed on products and services.

It may be reflected in the way consumers think, feel and act with respect to the

brand, as well as in the prices, market share and profitability the brand commands for

the firm.

What is Brand Equity?

Outline:

Like playing basketball, managing a brand involves strategies…

Brand Positioning

Brand Marketing

Brand Performance

Brand Value

Step 1. Identify and establish

Step 2. Plan and implement

Step 3. Measure and interpret

Step 4. Grow and sustain

Identifies the maker & signifies quality

Offers legal protectionServes as competitive advantage

Creates barriers to entry

Organizes accounting and simplifies product handling

Secures price premium

Loyola SchoolsAGSBSchool of LawSchool of Medicine

Hi, I’m Jersey 17, I am passionate and I try to be the best at what I do especially

basketball.

What is important to me is to give my

fans a good game and give my best for

the team.

Even though I am busy with my career, I was still

able to finish my education & start my own

business

I hope I inspire young athletes to

pursue their dreams, whatever sport they

are into.

Images

Feelings

Thoughts & Beliefs

Improved perceptions of product performance

Greater Loyalty

Large Margins

Less vulnerability to competitive marketing actionsMore inelastic consumer responseIncreased marketing communications effectiveness

Brand Asset Evaluator (BAV) compares brand equity of thousands of brands across hundreds of categories and these are its four pillars (Derek)

One comparative measure of brand equity is the BAV

Brand Equity

Brand Essence

Core Identity

Develop your brand’s identity.

Aaker Model

Brand Essence:Movement for self-esteem

Campaign for real beautyEmpowering

Aaker Model

Brand Essence:

Extended Identity:

Dove Men + Care

Aaker Model

Brand Essence:

Extended Identity:

Dove Men + CareCore

Identity:Beautiful

SkinAaker Model

Bonding

Advantage

Performance

Relevance

Presence

Brand building follows a sequential series of steps:

Strong relationshipHigh share of category expenditure

Weak relationship/Low share of categoryexpenditure

Do I know about it?

PresencePresence

Does it offer me something?

Presence

Relevance

Can it deliver?

Presence

Relevance

Performance

Advantage

Bonding

Does it offer something better than others?

Presence

Relevance

Performance

Advantage

Bonding

Nothing else beats it!

Presence

Relevance

Performance

Advantage

Bonding

Brand Resonance Pyramid

Presence

Performance & Imagery

Judgment & Feelings

Resonance

Brand Salience

Brand Elements

Men and Women for others…The Ateneo Way…

Memorable

Like the person of your dreams, brand elements should be…

Meaningful

Likeable

Transferable?

Adaptable

Protectible

Marketing Activities

Meaning Transference

Mirrors your brand

Designing Holistic Marketing Activities

Brands are not built by advertising alone.

Personalize Integrate Internalize

Brand Audits

Measuring Brand Equity

Brand-Tracking

Brand Valuation

Health of brandSource of brand equityWays to improve equity

Where, how much & what ways brand value is being created?

Financial Value of the brand

In summary:

Images

Feelings

Thoughts & Beliefs

RelationshipBrand Consumer

Brand Elements

Presence

Relevance

Performance

Advantage

Bonding

Presence

Marketing Activities and Meaning Transference

The company

Brand Valuation

Donna SiaMay 4, 2012

Chapter 9 Creating Brand Equity

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