Brands and Brand Equity.pptx

 What is a product?
 Something of perceived value that can be exchanged
for something of value because it satisfies some type
of need
 Value is subjective
 What is value?
▪ Net worth/benefits/utility
▪ Some function of “what’s in it for me” vs “what do I have to give up”

Core Product - Basic Benefit(s)
satisfied
Generic Product – Set of
features that only deliver the
basic benefit
Expected Product – Set of
features that the customer
expects from the product
Augmented Product – Set of
features that deliver additional
benefits beyond the basic
benefits and expected benefits
Potential Product - Set of all
possible future augmentations
and transformations

Core
Benefit
Generic Expected Augmented Potential
Air
Conditioner
Comfort Sufficient
Cooling
capacity
(BTU)
Fits in
window;
warranty,
multiple
speeds
Remote
control;
detects
motion to
turn on
No need to
vent to
outside;
silent;
College

 Commodity
 Product sold by 2+ companies where the quality is uniform
▪ Therefore, benefits are also the same
 All the products for sale are essentially the same
 Generic Product
 Product with the absence of a brand name

 What is a brand?
 American MarketingAssociation
▪ "Name, term, design, symbol, or any other feature that
identifies one seller's good or service as distinct from
those of other sellers."
▪ This is the “small” definition and not what most
marketers consider the proper definition.

 “Big” definition of a Brand
 Customer’s perception of the product/offering
▪ Set of associations in the customer’s memory based
upon direct and indirect experience that influences her
beliefs, attitudes, expectations, feelings, and behavior
toward the brand
 The power and value of the brand is what resides
in the minds of the customers
▪ Perception is reality

 Identification of manufacturer
 Who made it and who is responsible if a problem
 Risk reducer
 Financial, functional, social, safety (physical and emotional)
 Search cost reducer
 Search goods – determine quality during search
 Experience goods – determine quality after using
 Credence goods – can’t really judge the quality at all
 Signal of quality (good or bad)
 Symbolic device - (what the brand says about us)
 Promise, bond, or pact with manufacturer (relationship)

 Legal protection of unique features
 Signal of quality to consumers
 Customer more accepting of claims
 Means of endowing products with unique
associations (differentiation)
 Source of competitive advantage
 Source of financial returns
 This is really an outcome

 Building strong brands is expensive
 Makes products more expensive
 Many brand building activities do not make the brand any
better or more valuable
 Costs of advertising, distribution
 Brand name becomes a major determinant attribute in
purchase decisions
 Customers don’t judge brands on actual features and benefits
 New brands can’t afford to compete even though they
may be better
 Key to success is branding not better product

 Snapple
 Originally apple juice – bad bottling led to bottle caps flying off,
thus name Snapple
 1987 first lemon tea marketed in NYC
 “Best stuff of earth” tag line
 Contracted with 30+ bottlers; 80 employees
 Distributed to convenience stores, delis, gas stations etc with
refrigerated coolers
 1990’s “Snapple Lady” ads spoofs traditional advertising
▪ Anti-hero approach
 Sales reach $700 million by 1994
 Product line expanded to lemonade and even flavored soda
 Early entry in the RTDTea market and overall functional drink
market

 1994
 Quaker Oats buys for $1.7 million
▪ Focuses on using Snapple along with Gatorade to get more beverage
shelf space in supermarkets and mass merchandisers
 1997
 Sold toTriarc for $300 million
▪ Triarc owned MisticTea & Stewart Root Beer
 2000
 Triarc sold to Cadbury Schweppes for $1.45 billion
 2008
 CS spins off beverage business into Dr.Pepper Snapple Group
to a group of investors (already owned Dr. Pepper & 7 Up)
 2014
 Snapple market share

 Forbes 100 top brands for 2015
 Interbrand 100 top brands 2015
 Interbrand 100 top brands for 2005
 Brand Leaders by Category

 Brand Equity Definition
 Differential effect that brand knowledge (brand
associations) has on customer response to the marketing
of that brand
▪ Positive and negative
▪ Which brands have negative equity (brand liability?) to you?
 Kmart, Skechers
 Similar to the accounting notion of “goodwill” when
computing the value of a brand or business
▪ “Value premium” of a brand name – how much more $ the brand is
worth based upon current and future profits
 Definition depends upon one’s perspective
▪ Marketing vs Finance
▪ Relative to generic brand? Average brand? Competitor?

 Higher customer expectations
 Brandmarkstrustmarkslovemarks to emotionally bind the consumer
 Brand proliferation – more line & brand extensions; commodization
 Better and increased global competition
 Growth of private labels
 Traditional media issues
 Higher costs, clutter, fragmentation, selective exposure
 Increase in alternative media
 Social media is “earned” media
 Website(s) is “owned” media
 Traditional media is “paid” media

 Increased financial accountability for marketing
 Marketing budgets and expenses have to be justified and profitable
 Short-term focus
 Increasing short-term sales may hurt long-term branding efforts to build value
▪ Lower prices and decrease spending on advertising and other brand building efforts
 Increased marketing costs
 Media and marketing costs have grown faster than any increases in audience
and target markets
 2015 brand trends (recent factors)
 Disruption by innovations
▪ Tablets and phone wipe out desktops and laptops, cloud computing
▪ Netflix destroys Blockbuster
▪ Amazon attacking brick and mortar
▪ CVS andWalgreens providing medical services

 Benefits of Brand Equity
 Greater brand loyalty
▪ Less vulnerable to competitor’s marketing
▪ Less vulnerable to marketing crises (Chipotle,Toyota,VW)
 Marketing communications and efforts viewed more positively
▪ More “earned” or “shared” media
▪ Greater customer engagement
 Larger profit margins
▪ Greater perceived value
▪ Inelastic demand as price increases
▪ Elastic demand as price decreases
 Greater trade cooperation and power in the channel
▪ More valuable as a partner, more profit
 Brand platform for brand extensions and cobranding

Initiating
- First impression; often physical
Experimenting
- Engage in self-disclosure; begin to get a feel for each
other
Intensifying
- Increased intimacy in self-disclosure; pet-names;
“love”; secret tests (endurance; public presentation;
going without, 3rd party questioning, triangle tests
(jealousy)
Integrating
- Sharing of things important; marks beginning of
Maintenance phase
Bonding
- public, exclusive, contract
Differentiating
- Differences between people emphasized
Circumscribing
- Each person has their individual space where they
are to be left alone by the other person (work, hobby)
Avoiding
- Actively stay away from the other person
Terminating
- Decide to dissolve the relationship

Keller Model of Consumer Based Brand Equity
Brand Salience
Brand Performance & Imagery
Brand Judgements & Feelings
Brand Resonance
Brand Salience (Share of the Mind, Relevance)
- Recall, brand recognition, category leadership, usage situations; consideration set
Brand Performance & Imagery (Points of Difference & Parity; Brand Meaning)
- Perceived to offer unique and favorable functional, psychosocial, & experiential benefits;
brand personality
Brand Judgments and Feelings (Responses)
- Relative quality, credibility, consideration; feelings of warmth, fun, excitement, security,
social approval, self-respect
Brand Resonance (Relationship; Share of the Wallet)
- Bonding between brand and user; behavioral and attitudinal loyalty; sense of community
with other users; active engagement; brand advocacy; lifestyle brand

 Brandz’s model of brand equity
Does it offer me anything?
Nothing beats it!
Does it deliver?
Does it deliver more than others?
Do I know about it?

 2015 Brand Loyalty by Category
 2014Top 100 Brand Loyalty

 Cult Brands
 Brands with devoted fans that form a community
 Harley Davidson, Jimmy Buffet, NFL, Apple, Amazon
 Building cult brands – 7 rules for building cult brands

 Lifestyle Brands
 Brands that attempt to connect with the customer by supporting or
reflecting the attitudes, interests and opinions of a group or culture
▪ Make the brand part of a person’s identity and need for self-expression
▪ Less emphasis on functional benefits and performance in marketing
communications
▪ More emphasis on emotional and social benefits and how that supports the lifestyle
 Achieve by
▪ Sharing values through higher purpose by giving back (Tom’s)
▪ Enabling customer feedback, input, and design so product can be self-expressive
(Patagonia, Red Bull)
▪ Being instrumental and trusted in achieving/living the lifestyle (Nike, Chipotle,Whole
Foods)
▪ Be iconic symbol/standard of the lifestyle (LL Bean,Volcom, Beats, Polo)
 ToyotaTacoma RamTrucks LincolnWhat is being advertised?

Brands and Brand Equity.pptx

More Related Content

Similar to Brands and Brand Equity.pptx

Recently uploaded

Brands and Brand Equity.pptx