Creating Brand Equity

9-2

Brand

A name, term, sign, symbolor design, or a combination of them,

intended to identify the goodsor services of one seller or group

of sellers and to differentiatethem from those of competitors.

9-3

The Role of Brands

Identify the makerIdentify the maker

Simplify product handling or tracing

Simplify product handling or tracing

Organize accounting and inventory records

Organize accounting and inventory records

Offer legal protection for unique features or aspects of product

Offer legal protection for unique features or aspects of product

9-4

The Role of Brands

Signify qualitySignify quality

Create barriers to entryCreate barriers to entry

Serve as a competitive advantage

Serve as a competitive advantage

Secure price premiumSecure price premium

9-5

Branding

Endowing products and serviceswith the power of a brand.

9-6

Brand Equity

The differential effect that brandknowledge has on consumer

response to the marketing of that brand.

9-7

Brand Knowledge

Knowledge

Thoughts

Experiences

Beliefs Images

Feelings

9-8

Marketing Advantages of Strong Brands

• Improved perceptions of product performance

• Greater loyalty• Less vulnerable to

competition• Less vulnerable to crises• Larger margins• Inelastic consumer

response to price increases

• Elastic consumer response to price decreases

• Greater trade cooperation

• Increase in effectiveness of IMC

• Licensing opportunities

• Brand extension opportunities

9-9

Branding a Place

9-10

Brand Promise

The marketer’s vision of whatthe brand must be and do for

Consumers.

9-11

The Virgin Brand

9-12

Brand Equity Models

• Brand Asset Valuator

• Aaker Model

• BRANDZ

• Brand Resonance

9-13

Brand Asset Valuator (BAV)

Differentiation

Relevance

Esteem

Know

ledge

Brand Equity

9-14

Aaker Model – Brand Identity

Brand-as-product(Scope, attributes,

quality/value, uses, users,

Country of origin)

Brand-as-person(Brand Personality,

customer relationships)

Brand-as-symbol(visual imagery/metaphors,

Brand heritage)

Brand-as-organization(Organizational Attributes,

local vs. global)

9-15

Aaker Model – Brand Assets

Brand

loyaltyBrand

associations

Perceived

quality

Brand

awareness

ProprietaryAssets (patents,

trademarks, channel

relationships)

9-16

The BRANDZ Model (sequential steps)

Presence (awareness)

Relevance (value)

Performance (deliver)

Advantage (better)

Bonding (best)

9-17

Brand Resonance Pyramid (sequential series of steps)

9-18

Drivers of Brand Equity

Brand Elements

Marketing Activities

Meaning Transference

9-19

Brand Elements

ElementsSlogans

Brand

names URLs

Logos

SymbolsCharacters

9-20

Brand Elements

9-21

Brand Element Choice Criteria

• Memorable– recall

• Meaningful– credible

• Likeability– appealing

• Transferable– other products or

locations• Adaptable

– updatable is brand elements

• Protectible– legally

9-22

The cupped hands are an element of Allstate’s brand

9-23

Slogans

• Like a good neighbor, State Farm is there

• Just do it• Nothing runs like a

Deere• Help is just around the

corner• Save 15% or more in

15 minutes or less

• We try harder• We’ll pick you up• Nextel – Done• Zoom Zoom• I’m lovin’ it• Innovation at work• This Bud’s for you• Always low prices

9-24

Designing Holistic Marketing Activities

Personalization(Internet, experiential, one-to-one,

permission)

Integration(mixing/matching marketing

activities to maximize

individual/collective effects)

Internalization(activities/processes to

inform/inspire employees)

9-25

Measuring Brand Equity

Brand Audits (health of brand)Brand Audits (health of brand)

Brand Tracking (over time)

Brand Tracking (over time)

Brand Valuation (financial worth)Brand Valuation (financial worth)

9-26

The 10 Most Valuable Brands

Brand 2004 Brand Value (Billions)

Coca-Cola $67.39

Microsoft $61.37

IBM $53.79

GE $44.11

Intel $33.50

Disney $27.11

McDonald’s $25.00

Nokia $24.04

Toyota $22.67

Marlboro $22.13

9-27

Managing Brand Equity

Brand Reinforcement (consistently convey the meaning of

the brand)

Brand Reinforcement (consistently convey the meaning of

the brand)

Brand RevitalizationBrand Revitalization

Brand CrisesBrand Crises

9-28

Devising a Branding Strategy

Develop new brand elements

Develop new brand elements

Apply existing brand elements

Apply existing brand elements

Use a combination of old and new

Use a combination of old and new

9-29

Brand Naming

Individual names (not tied to company reputation)

Individual names (not tied to company reputation)

Blanket family names(create brand-name recognition)

Blanket family names(create brand-name recognition)

Separate family names(very different products)Separate family names(very different products)

Corporate name-individual name combo

(sub-branding—Kellogg’s Rice Krispies, Raisin Bran, Corn Flakes)

Corporate name-individual name combo

(sub-branding—Kellogg’s Rice Krispies, Raisin Bran, Corn Flakes)

9-30

Brand Roles in a Brand Portfolio

Flankers(attack competitor brands so

flagship brands retain

desired positioning)

Low-end

Entry-level(attract customers)

High-end

Prestige(adds value & credibility

to entire portfolio)

Cash Cows(milk reservoir of

existing brand equity)

9-31

Branding A Service Organization

• A strong service brand is essentially a promise of future satisfaction

• Blend (customer’s point of view) of what the organization:– states it is,– what others say, and – how the organization performs the service

• Principal components of a service brand– Presented Brand—controlled communications– Brand Awareness—ability to recognize & recall brand– External Brand—uncontrolled communications– Brand Meaning—dominant perceptions of brand– Brand Equity--differential effect that brand knowledge

has on consumer response to the marketing of that brand.

9-32

A Service-Branding Model

Presented Brand

External BrandCommunications

Customer Experiences

withCompany

Brand Awareness

Brand Meaning

Brand Equity

9-33

Cultivating Brand Equity

Internalize the Brand Dare to be Different

Determine your own

FameEmotional Connection

Brand Equity

9-34

Dare to be Different• The strongest brands reveal a conscious effort to be

different• Branding strategy goal is to reinforce a demonstrably

different service experience with a demonstrably different brand presentation– Starbucks could squeeze more tables and chairs into

their stores, but doing so would undermine what they are really selling: a respite and a social experience

– Because of its two-by-two configuration of leather seats (instead of the more common three-by-three seating), Midwest Express Airline’s all coach service seems like first class.

– Enterprise Rent-A-Car customer-contact employees dress for differentiation. Men wear suits and women dresses or shirts and hose.

9-35

Determine Your Own Fame• Service companies strengthen brand equity by focusing

on underserved marketing needs.• Service companies with strong brand equity provide a

service that customers truly value; perform it better than competitors; and effectively tell their story through communications that create awareness, stimulate trial, and reinforce customers’ experiences– Charles Schwab Corporation gave investors who knew

what stocks they wanted to buy or sell the opportunity to do so without paying full commissions for advice they did not use.

– In Zagat’s (1997) survey of 60 of the world’s largest airlines on comfort, service, timeliness, and food, Midwest Express ranked 1st in the United States and was the only U.S. airline to place in the world’s Top 10

9-36

Make An Emotional Connection

• Great Brands reach beyond the purely rational and purely economic level to spark feelings of closeness, affection, and trust.

• Consumers live in an emotional world; their emotions influence their decisions.

• Great Brands transcend specific product features and benefits and penetrate people’s emotions.

• Charlotte Beers (1998), chairman of J. Walter Thompson, stated “The truth is, what makes a brand powerful is the emotional involvement of customers”– The Globetrotters is a magical brand—a brand that evokes

images of fun and laugher, respect and decency, hard work, and good values.

– Midwest Express could portray chocolate chip cookies in its advertising, but far more powerful is actually baking them onboard for passengers and serving them with a warm smile

9-37

Internalize the Brand

• Internalizing the brand involves explaining and selling the brand to employees. Most of all, internalizing the brand involves involving employees in the care and nurturing of the brand– Enterprise Rent-A-Car

• “We’ll pick you up”

– Midwest Express noted that its employees are the most important audience for its marketing efforts.