SESSION 12Product is what we create in factories but brands are created in consumer mind a name, term, design, symbol or any other feature that identifies one seller’s goods from another a) Twist a coke b) Hello happiness c) Fair Play d) Support my school e) Happiness truck Find the right balance between maintaining a consistent brand image and updating brand associations to keep the brand relevant Products are mute: Brand tells us how to read them Brand endow product with a meaning - Cadbury (Changing campaign) Kuch swad hai Zindagi mein – Bring out the child in you Khane walon ko khane ka bahana chaiye – Adult targeting Shubh Arambh - Auspicious Kuch meetha ho jaye – Custom and tradition (Special occasions) Customer brand relationship Self-concept connection The brand’s and my self-image are similar. The brand reminds me of who I am. Commitment or nostalgic attachment I feel very loyal to this brand. I will stay with this brand through good times and bad. Behavioral interdependence This brand plays an important role in my life. I feel like something’s missing when I haven’t used the brand in a while. Love / passion No other brand can quite take the place of this brand. I would be very upset if I couldn’t find this brand. Intimacy I know a lot about this brand. I know a lot about the company that makes this brand. Brand partner quality I know this brand really appreciates me. This brand treats me like a valued customer. Leveraging Brand Equity Line Extension – Adding products to same line – Diet Coke, LED TV,SMART TV Brand Extension – Juices by Cola brand Co-Branding – Nike + apple Evolving world of branding Brand Communities – HOG, Mixing Bowl – Meredith Corporation (Sharing of recipes), MOM Junction (p&G) Session 13B How brands create value Financial analyst prefer firms with strong brands Near certain future cash flows High degree of loyalty – Stability of future sales Justifies the premium … image of superior quality & added value Entry barrier to competition … acts as a reference Can generate royalties if a trend setter… by allotting licenses Can enter other markets Brand reputation complements advertising Brands don’t suffer from ceiling effect Brand awareness without mass media Orlando’s Jacob Creek Leader in volume & spontaneous brand awareness Strong image What went into it Enough volume : trade expectations Securing a stable quality: reduced perceived risk Mainstream price End user driven National & strong sales force Brand awareness without mass media Positioning: Game of perception Game that you don’t play with the product but with the consumer mind 4 W’s – why, for whom, when, against whom Criteria for positioning Customer benefit Close-up Volvo crash tests Price and quality Big Bazaar Wal-Mart Usage based Attempt is to expand the market Tata sky Master Card Occasion based Cadburys User based J & J By product class 7Up’s Uncola campaign By cultural symbols Marlboro By competition Avis “ We are no.2 so we try harder” Some Concepts Target Market Frame of reference Who the target consumer is Who the main competitors are Competition occurs only at benefit level and not attribute level Points of difference (POD) Reason why Points of parity( POP) No reason why not POD: It should be deliverable Feasibility ( wrt Company) Communicability ( wrt Consumer) Sustainability ( wrt Competition) POP: Two types: Category and competitive Category: necessary but not sufficient Competitive: Associations designed to negate competitor’s point of difference Establishing POP and POD – dealing with misnomers 1) Leveraging another brand’s equity – Amitabh Bacchan for ICICI 2) Redefine the relationship – Maggi “Taste bhi health bhi” Move positioning with time Laddering Underlying consumer motivations to uncover relevant associations Means end chain …attributes, consequences, core values Progresses from attributes to benefits to more abstract values and motivations ICICI ad …khayal apka Session 15 Brand equity: The component of overall preference not explained by objectively measured attributes Likes the brand Satisfied buyer …with switching costs Habitual Buyer – No Reason Switchers – No loyalty Measures of loyalty Actual purchase pattern Repurchase rates Percent of purchases Number of brand purchased Behavioral data … although objective , has limitations Limited diagnostics about future Loyalty differs across categories A key diagnostic for every level of loyalty is the measurement of satisfaction And, perhaps, more important, dissatisfaction Value of Brand loyalty 1) Trade leverage 2) C2C marketing 3) Time to respond to competitors 4) Reduced marketing expenses Perceived Quality: Provides an option of charging a premium price Influences: Performance: primary operating characteristics Features: Signals that the firm understands the needs of product users Conformance with specification: manufacturing oriented view of quality Success of Japanese automakers Reliability: Consistency of performance Durability: Economic life of the product Volvo cars Brand Associations: A well-positioned brand will have a competitively attractive position supported by strong associations Types of Associations: CULPRI – Celebrity, Use/customer, lifestyle, product class, relative price, intangibles PUCCC- Product attributes, use/application, country/geo, customer benefits, competitors Session 16 Perimeters of brand extension Basis of Brand Leveraging Power: Troopers: Familiar and Appealing Create more financial benefits – Tropicana Diamonds: Most valuable and appealing to customers – Coca Cola Developer: Rank low on familiarity – Apple Extensions have strengthened the brand – Itunes and Ipod Brand Extension decision Step 1: Determine consumer familiarity & regard for the brand Step 2:Assess the Brand’s expected Leverage power Step 3:Consider Alternatives Extend selectively … Sub-branding … Vichy, La Roche-Posey, Garnier, Maybelline Recognize the brand’s limits Session 17: Challenges facing the brand – Private labels Shifting power Comparison shopping Pricing Service Session 18: Consensus Maps: Products are mortal but brands can escape the effect of time OverTime Brand Equity stagnates Firm is maintaining an old and tired brand Revitalization … its not just about added sales level but is about:- Enhanced equity Improved recognition Enhanced perceived quality Changed associations Expanded customer base Increased loyalty Revitalizing the brand - A FEE ROI Augmenting - When close to becoming a commodity, augment it Finding new uses Entering Markets- finding new users, markets and occasions Extending Brand Repositioning Obsoleting Increased use – Increase frequency, level of use Milking: Avoiding investment … attempting instead to generate additional cash flows Fast Milking – Lux Exiting Decline rate is rapid and accelerating Brand position is weak Firm’s mission changes Exit barriers can be overcome Session 19: Global and Glocal Global brand structures: Corporate: Relatively limited products or market diversity (Shell, Toyota, Nike) Product: multiple national or local brands, international expansion due to power brands (P&G) Hybrid: Mix of global, regional/ national product level brands (Danone) Global consumer segments: Global citizens ( 55%) Rely on global success of a company as a signal of quality Global dreamers (23%) Ardent in their admiration of global Antiglobals (13%) Skeptics Global Agnostics (8%) More in America and Japan … and def. less in China & India Barriers to globalization Legal differences Competition Consumption habits Distribution Structure Brand Awareness Lifestyle Differences Consumer’s buying power Consumer’s age differences