Published on March 15, 2014
PRODUCT VS. BRAND Attention, acquisition, use or consumption, employee, political figure, department store Additions in terms of packaging, services, advertising, customer advice, associations and other things that people value,
THE SECRET OF SUCCESSFUL BRANDS
CUSTOMER BASED BRAND EQUITY (CBBE) • The power of the brand lies in what resides in the minds of the customer • CBBE- defined as “the differential effect that brand knowledge has on consumer response to the marketing of that brand” • A brand has positive CBBE when consumers react more favorably to a product and the way it is marketed when a brand is identified than when it is not.
3 KEY INGREDIENTS OF THIS DEFINITION “the differential effect that brand knowledge has on consumer response to the marketing of that brand” 1. Differential effect 2. Brand Knowledge 3. Consumer response to marketing
I.E. FIGURE 2.2 Results of Blind beer taste tests
MARKETING ADVANTAGES OF STRONG BRANDS • Improved perceptions of product performance • Greater Loyalty • Less vulnerable to competitive marketing actions • Larger margins • Inelastic response to price increase • Elastic response to price reductions • Increased Marcom effectiveness • Brand extension opportunities
MAKING A STRONG BRAND Key driver is Brand knowledge Brand awareness Brand image (associations and characteristics)
ASSOCIATION TEST 1
ASSOCIATION TEST 2
ASSOCIATION TEST 3
SOURCES OF BRAND EQUITY Brand recognition and brand recall
BENEFITS OF BRAND AWARENESS Learning Advantage – Customers are more receptive Consideration Advantage – consideration set Choice Advantage – affect choice amongst the consideration set Consumer purchase motivation – indifference i.e. gas Consumer purchase ability – inability to judge what’s best due to lack of prior experience i.e. new cooks
All brands Known Brands Acceptable brands Unacceptable brands Indifferent brands Over looked brands Unknown Brands COMPETITIVE BRAND ALTERNATIVES – DEFINING COMPETITIVE SET Evoked Set Rejected brands Inept set
ESTABLISHING BRAND AWARENESS • Increasing the familiarity of the brand • The more the consumer interacts with the brand (seeing, hearing or thinking about it) the more aware they get • Anything that causes a consumer to experience the brand
BRAND RECALL REQUIRES LINKAGE TO THE PRODUCT CATEGORY
BRAND IMAGE • Is built through favorable brand association • Consistency – don’t change over time • Favorability brand associations – depends on the customer, time, nature of association • Uniqueness of brand associations
BRAND BUILDING BLOCKS • Brand Salience – measures the awareness of the brand • i.e. how often and how easily the brand is evoked under various situations or circumstances. • To what extent is the brand top of the mind easily recalled or recognized? • Brand Salience – helps us understand the degree to which the customers understand the product or service category in which the brand competes and what products or services are sold under the brand name • It also ensures that customers know which of their needs the brand through these products is designed to satisfy
PRODUCT CATEGORY STRUCTURE – ORGANIZED IN THE MEMORY OF CUSTOMERS
BRAND BUILDING BLOCKS • Brand Performance – the product is at the heart of brand equity. • It directly influences the consumer experience with the brand. • It defines how well does the product or service meets the customers more functional needs • How well the brand rate on assessment of quality? • To what extent does the brand satisfy utilitarian, aesthetic and economic customer needs and wants in the product or service category? 5 attributes to product performance • Primary ingredients and supplementary features • Product reliability, durability and serviceability • Service effectiveness, efficiency and empathy • Style and design • Price
BRAND IMAGERY • Includes the ways in which the brand attempts to meet the customers psychological or social needs • It is the way people think about the brand abstractly rather than what the brand actually does • Thus imagery refers to the more intangible aspects of the brand • Customers can form imagery about a brand based on their own experience or indirectly through advertising or by some other source of information • 4 main intangible that can be linked to a brand are 1.User profiles 2.Purchase and usage situations 3.Personality and values 4.History, heritage and experiences
BRAND JUDGEMENT • Are the consumers personal opinions about and evaluations of the brand, which consumers form by putting all the different brand performance and imagery associations. • Brand quality: perceived quality • Brand credibility: perceived expertise, trustworthiness, and likability • Brand consideration: strong and favourable brand associations and imagery • Brand superiority: Unique and better than other brands. Number and nature of unique brand associations that make up the brand image
BRAND FEELINGS • Are the customers emotional response and reactions to the brand. • 6 important types of brand building feelings i.e. Titan 1. Warmth: sense of calm and peacefulness, sentimental, warm-hearted or affectionate about a brand 2. Fun: upbeat types of feelings make consumers feel amused, light-hearted, joyous, playful, cheerful i.e. Disney 3. Excitement: the brand that makes consumers feel energized and that they are experiencing something special i.e. Redbull 4. Security: feeling of safety, comfort and self assurance i.e. Ceylinco 5. Social Approval: feel that others look favourable on their response i.e. Mercedes 6. Self respect: makes consumers deel better about themselves i.e. P&G
BRAND RESONANCE • Ultimate relationship with the brand • Describes the nature of this relationship and the extent to which consumers think they are in sync with the brand. • The intensity of the psychological bond the consumer has with the brand • The level of activity engendered by this loyalty i.e. repeat purchase, seeking out information • Behavioural loyalty: repeat purchases and category share (CLV) • Attitudinal attachment: • Sense of community • Active engagement
CUSTOMER BASED BRAND EQUITY PYRAMID
POSSIBLE MEASURES OF BRAND BUILDING BLOCKS Figure 2.9 page 75
POSSIBLE MEASURES OF BRAND BUILDING BLOCKS Figure 2.9 page 75 &76
SHOULD BRANDS HAVE DUALITY Head Heart
BRAND RANKINGS ON RESONANCE DIMENSIONS Fig 2.10 – page 79
CREATING CUSTOMER VALUE CRM – relationship management, use IT to support Customer Equity – CLV Invest in highest value customers first Product management to customer management Up sell and cross sell Reduce acquisition costs Track customer equity gains and losses against marketing programs Relate branding to customer equity Retainability of customers HAVE 2 MKTN PLANS, OR 2 DEPTS FOR ACQUISITIONS AND RETENTION
BRAND VS. CUSTOMER EQUITY • Brand Equity – customers subjective and intangible assessment of the brand beyond its objectively perceived value • Customer Equity - is the total combined customer lifetime values of all of a company's customers
COURSE BOOK – STRATEGIC BRAND MANAGEMENT Customer Based Brand Equity Chapter 02 Authors Kevin Lane Keller M.G. Parameswaran Isaac Jacob Presentation compiled by Leroy J. Ebert Chartered marketer, MCIM, MSLIM Manager Marketing and Business Logiwiz Ltd.
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