Team Project - Brand

Brand Equity &

Brand Positioning

Customer-Based Brand Equity - Customer-based brand equity concept: the power of a

brand lies in what customers have learned, felt, seen, and heard about the brand as a result of their experiences over time

- Customer-based brand equity: the differential effect that brand knowledge has on customer response to the marketing of that brand

- Positive customer-based brand equity: customers react more favorably to a product and the way it is marketed when the brand is identified than when it is not

- Customers are more willing to accept brand extensions

Customer-Based Brand Equity - Negative customer-based brand equity: customers react

less favorably to marketing activity for the brand compared with an unnamed or fictitiously named version of the product

- Key ingredients to CBBE: • Differential effect

• Arises from differences in customer response • Brand knowledge

• What customers have learned, felt, seen, and heard about the brand as a result of experiences overtime

• Customer response to marketing • Customers perceptions, preferences, and behavior

related to all aspects of brand marketing

Marketing Advantages of Strong Brands - Improved perceptions of product performance - Greater loyalty - Less vulnerability to competitive marketing actions - Larger margins - More inelastic consumer response to price increases - More elastic consumer response to price decreases - Greater trade cooperation and support - Increased marketing communication effectiveness - Possible licensing opportunities - Additional brand extension opportunities

Brand Knowledge - Brand knowledge is the key to creating brand equity,

because it creates the differential effect that drives brand equity

- Associative network memory model: views memory as a network of nodes and connecting link, in which nodes represent stored information or concepts, and links represent the strength association between the nodes

- You can think of brand knowledge as consisting of a brand node in memory with variety of associations linked to it

Brand Knowledge - Brand knowledge has two components:

• Brand awareness: the strength of the brand node or trace in memory, which we can measure as the consumer’s ability to identify the brand under different conditions

• Brand image: the consumer’s perceptions about a brand, as reflected by the brand associations held in consumer memory

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Just do it.

Brand Awareness - Brand awareness consists of two components:

• Brand recognition: consumers’ ability to confirm prior exposure to the brand when given the brand as a cue

• Brand recall: consumers’ ability to retrieve the brand from memory when given the product category, the needs fulfilled by the category, or a purchase or usage situation as a cue

Advantages of Brand Awareness - Learning advantages

• Brand awareness influences the formation and strength of the associations that make up the brand image

• Register the brand in the minds of the consumers - Consideration Advantages

• Consumers must consider the brand whenever they are making purchase decisions to fulfill or satisfy a need

• Consideration set: the handful of brands that receive serious consideration for purchase

Advantages of Brand Awareness - Choice Advantages: creating a high level of brand

awareness is that it can affect choices among brands in the consideration set, even if there are essentially no other associations to the brand • Consumer purchase motivation • Consumer purchase ability • Consumer purchase opportunity

Establishing Brand Awareness - Increase the familiarity of the brand through repeated

exposure, more effective for brand recognition than for brand recall

- The more a consumer experiences the brand by seeing it, hearing it, or thinking about it, the more likely he or she is to strongly register the brand in memory

- Repetition increases recognizability, but improving brand recall also requires linkages in memory to appropriate product categories or other purchase or consumption cues

Brand Image - Creating a positive brand image takes marketing programs

that link strong, favorable and unique associations to the brand in memory

- Brand associations are made up of two key components: • Brand attributes: descriptive features that characterize

a product or service • Brand benefits: personal value and meaning that

consumers attach to the product or service attributes

Strength of Brand Associations - Two factors to strengthen association to any piece of

information are its personal relevance and the consistency with which it is presented over time.

- Direct experiences create the strongest brand attribute and benefit association and are particularly influential in consumers’ decisions when they accurately interpret them

Favorability of Brand Associations - Marketers create favorable brand associations by

convincing consumers that the brand possesses relevant attributes and benefits that satisfy their needs and wants, such that they form positive overall brand judgments

Uniqueness of Brand Associations - Essence of brand positioning is that the brand has a

sustainable competitive advantage or unique selling proposition that gives consumers a compelling reason why they should buy it

- Unless the brand faces no competition, it will most likely share some associations with other brands

Brand Positioning - Brand positioning: the act of designing the company’s

offer and image so that it occupies a distinct and valued place in the target customer’s mind

Customer Segmentation Bases

Business-to-Business Segmentation Bases

Criteria

Nature of Competition - Indirect competition: a brand does not face direct

competition in its product category, and does not share performance-related attributes with other brands, it can still share more abstract associations and face indirect competition in a more broadly defined category

- Multiple frames of reference: may result of broader category competition or the intended future growth of a brand, or it can occur when the same function can be performed by different types of products

Nature of Competition - Multiple frames of reference: may result of broader

category competition or the intended future growth of a brand, or it can occur when the same function can be performed by different types of products

Points-of-Difference Associations (PODs) - PODs: attributes or benefits that consumers strongly

associate with a brand, positively evaluate, and believe that they could not find to the same extent with a competitive brand

- Consumers’ actual brand choices often depend on the perceived uniqueness of brand associations

- Reasons to Believe (RTBs): functional design concerns, key ingredients, key endorsements

Points-of-Parity Associations (POPs) - POPs: are not necessarily unique to the brand but may be shared with

other brands - Three types of POPs:

• Category points-of-parity: represent necessary-but not necessarily sufficient- conditions for brand choice. minimal generic product level and most likely at expected product level

• Competitive points-of-parity: associations designed to negate competitors’ points-of-difference. A brand can break in areas where competitors are trying to find advantage and can achieve its own advantages in some other areas

• Correlational points-of-parity: negative associations that arise from the existence of other, more positive associations of the brand. If the brand is good at one thing it can also be good in something else

Negatively Correlated Attributes & Benefits

Positioning Guidelines - Defining and Communicating the Competitive Frame of

Reference • Which products or sets of products does the brand

compete? • Competing in PODs or POPs

- Choosing PODs • Three considerations

• Desirability: determined from the consumer’s point of view

• Deliverability: based on a company’s inherent capabilities

• Differentiation: determined relative to the competitors

Establishing POPs and PODs - Separate the attributes

• Can launch different marketing campaigns, each devoted to a different brand attribute or benefit

• May run concurrently or sequentially • Consumer will be less critical when judging POP and POD in

isolation because the negative correlation might be less apparent

- Leverage Equity of Another Equity • Brands can link themselves to any kind of entity that

possesses the right kind of equity-a person, other brand, event - Redefine the Relationship

• Address the negative relationship between attributes and benefits in the minds of consumers is to convince them that the relation is positive

Straddle Positions - Straddle two frames of reference with one set of POD and

POP - The POD in one category becomes the POP in the other

and vice versa - If POP and POD with respect to both categories are not

credible

Updating Positioning over Time - Laddering: deepen the meaning of the brand to permit

further expansion • Once the target market attains a basic understanding of

how the brand relates to alternatives in the same category, it may be necessary to deepen the meanings associated with brand positioning

- Maslow’s Hierarchy of Needs

Updating Positioning over Time - Reacting: responding to competitive actions that threaten

an existing positioning - When a competitor challenges an existing POD or

attempts to overcome a POP, there are three main options for the target brand

Brand Mantra

● A brand mantra is a short, three-to-five word phrase that captures the irrefutable essence or spirit of the brand positioning

● The purpose of brand mantra is to ensure that all employees and external marketing partners understand what the brand most fundamentally is to represent consumers so they can adjust their actions accordingly

● Brand mantras provide guidance about what products to introduce under the brand, what ad campaigns to run, and where and how the brand should be sold

Designing Brand Mantras

Implementing a brand mantra

● Brand mantras should be developed at the same time as brand positioning

● Brand mantras require more internal examination compared to brand positioning and involve input from a wider range of company employees and marketing staff

● Brand mantras require organizations to determine the different means by which each and every employee currently affects brand equity, and how he or she can contribute in a positive way to brand’s destiny