Brand Definition and Elements

The Brand - Definition

• A brand is a name, term, sign, symbol, design, or combination of these elements
• Brands identify the goods/services of a seller or group of sellers
• Brands differentiate them from competitors

Objective of Brand Elements

• Understanding essential aspects of a brand is a key objective
• Branding helps buyers identify and evaluate products
• Sellers benefit from easier product introduction, repeat purchases, and promotion

Brands as Touch Points

• Brands serve as touch points for consumers, representing a promise of specific benefits tied to products/services

Roles of Brands

• Branding fosters financial strength
• It increases market share
• Improves perceived quality
• Facilitates brand extensions, and commanding premium prices

Marketing vs. Branding vs. Product Problems

• If people do not know you, it's a marketing problem
• If people do not stay with you, it's a branding problem
• If people do not choose you, it's a product problem.

Attributes of Strong Brands

• Strong brands occupy a distinct position in consumers' minds by offering relevant benefits
• They create an emotional connection between businesses and consumers
• Strong brands create a unique identity, perception, emotions, and relationships
• They tell a story and is meaningful, memorable, and likeable

Brand Equity Defined

• Brand equity is the marketing and financial value linked to a brand's strength, including brand name awareness, brand loyalty, brand associations, perceived brand quality, and brand knowledge.
• Brand equity is the value based on loyalty, awareness, perceived product quality, and brand associations
• Brand equity Reflects long-term trust built in consumers' minds
• Strong brand names can become the category name itself

Benefits of Brands to Consumers

• Brands help consumers to search
• They signal quality
• Reduce risk
• Act as a symbolic device

Benefits of Brands to Companies

• A brand is a source of predictability and security of demand
• It creates barriers to entry and provides financial returns

Marketing and Branding Activities

• Marketing creates, communicates, and delivers the product.
• It creates intangible value

Measuring Intangible Value

• Intangible value can be measured using brand equity
• If Market Value/Tangible Assets > 1, intangible value has been created

Coke's Intangible Value

• Coke's intangible value is calculated by taking the stock price, multiplying it by the shares, and dividing by tangible assets, resulting in a value of 5, comparing brand name value vs. tangible assets.

Aaker Model: Levels of Customer Attitude

• Devoted to brand
• Values the brand (brand as friend)
• Satisfied and switching cost
• Satisfied customer (no reason to change)
• No brand loyalty (customer will change)

Brand Asset Valuator (BAV)

• Brand equity encompasses differentiation, relevance, esteem, and knowledge

Interbrand’s Brand Equity Formula - Brand Earnings

• Includes brand sales, costs of sales, marketing costs, overhead expenses, remuneration of capital charge, and taxation

Interbrand’s Brand Equity Formula - Brand Strength

• Considers leadership (25%), stability (15%), market (10%), geographic spread (25%), trend (10%), support (10%), and protection (5%)

Building Brands

• Building brands involves strategically creating a stronger presence through brand image, personality, and co-branding

Elements of Building Strong Brands

• Project the right message, provide identity, and save time

Aspects of Brand Image and Personality

• Brand image represents salient and feeling-related associations
• Brand personality includes specific “personality-type” traits or characteristics consumers ascribe to brands (e.g., masculine/feminine, calm/exciting)

Brand Archetypes

• Carl Jung posited that humans have a combination of archetypes: "universal, archaic _______ and images that derive from a collective unconscious and are the psychic counterpart of instinct

Packaging and Labeling

• Packaging and labeling is used in marketing strategies for protection, economy, safety, and convenience. Labeling serves for identification, promotion, information, and legal purposes.

Section 10 - Levels of Products

• Core, actual/tangible, augmented

Section 10 - Types of Consumer Products

• Convenience, shopping, specialty products are the different types
• To differentiate between them

Section 10 - Product Aspects

• Product line depth/extension, product mix width/brand extension knowledge is required

Section 10 - Innovation

• How a new product is classified as disruptive/sustaining/incremental is a key factor

Section 10 - New Product Development Process

• Understanding the stages of the new product development process is essential

Section 10 - New Products - Failure/Success

• Focus on reasons for new product failure/success, and why products face failure in the long run

Section 10 - Diffusion of Innovations

• Focus on adoption categories and their place along the timeline
• Focus on characteristics that influence diffusion

Product Life Cycle (PLC)

• Identify the transition points between each stage
• Focus on stages of the PLC where the sales and growth curves peak

Types of "Products"

• Physical Objects, People, Organizations, Services, Places, Ideas, and Information

Levels of a Product

• Core product: the need that the product fulfills
• Actual product: tangible features necessary for product function
• Augmented product: extra features that enhance the product

Types of Consumer Products

• Convenience products: Water bottle
• Shopping products: Jeans
• Specialty products: Lambo

Product Extensions

• Line extension: Improvement; new and improved; new colors for example, different Red Bull drinks
• Brand extension: current brand to a new product class for example, Cheetos lip gloss

Successful New Product Development

• Offer a strong relative advantage
• Reflect a better understanding of customer needs, and beat the competition to market
• Exhibit higher performance-to-cost ratios and higher contribution margins
• Demonstrate a strong correlation with a company’s profitability and sales growth

New Product Development

• Steps are Idea Generation, Idea Screening, Concept Development, Business Analysis, Test Market, and Commercialization

Test Market Purpose

• Determine the reactions of potential customers in a market situation

New Product Failure Rate

• A vast number of new products fail; 95% in the US and 90% in Europe.
• Reasons for failure include ignoring unfavorable market research, overestimating market size, marketing mix decision errors, and stronger than anticipated competitive actions.

Reasons Why New Products Fail

• No discernible benefits
• Poor match between ___________ and ____________
• Overestimation of market size
• Incorrect positioning
• Pricing problems
• Inadequate distribution
• Poor promotion

Diffusion

• Diffusion is the process by which the ___________ of an innovation spreads through communication to members of a social system over time.
• Adoption comes from stages through which an individual consumer decides to try (or not to try) a new product

Stages of Adoption

• The five stages of the traditional adoption process are awareness, interest, evaluation, trial, and adoption.

Factors that Influence the Rate of Diffusion

• Complexity
• Compatibility
• Observability

Adopter Categories

• Innovators, early adopters
• Majority
• Laggards

Adopter Percentages

• Innovators ≈ 2.5%
• Early adopters ≈ 13.5%
• Early and late majority ≈ 34%
• Laggards ≈ 16%

Product Life Cycle Stages

• Introductory
• Growth
• Maturity
• Decline

Services Marketing Notes

• Focus on; Importance of Services
• Product/Services Continuum: tangible vs. intangible
• Distinguishing Characteristics of Services: perishability, intangibility, variability, inseparability (always create connections for these)
• Three Additional P’s of Services
• Services Gap Model:
• Knowledge and Service Gaps
• Understand the Disconfirmation Paradigm
• Service Quality:
• Know each of the 5 dimensions
• Service Strategy Processing:
• people/possession/mental stimulus/information processing
• Promotion Strategy:
• Stressing tangible clues, Using personal information sources,
• Create a strong organizational image, Engage in post purchase communication
• Services Marketing Triangle in Services Industry:
• Internal/External/Interactive Marketing
• Understanding the Service Experience

Services Marketing Defined

• Services marketing is any activity or benefit that one party can offer another that is essentially intangible and does not result in ownership

Types of Services

• Service as a product: Hotels, telecommunication, banking, consulting, healthcare, software services
• Customer service: Taking requests, answering customer questions, responding to complaints
• Service as value-added: Training, installation, repair services connected with a physical product

Focus on Services

• Services frequently provide higher profit margins than products
• Customer satisfaction and loyalty are driven by service excellence
• Services can be used as a differentiation strategy in competitive markets

Product/Services Continuum

• Goods are tangible dominant- search attributes
• Services are intangible dominant- experience and credence attributes

Goods vs Services

• Intangibility is the primary source from which the other three characteristics emerge
• Variability is the difference in consistency from one service transaction to the next
• Inseparability is the simultaneous production and consumption of the service
• Perishability means that a service cannot be saved and cannot be inventoried

Customer Service

• Reliabilty: perform promised service dependably and accurately
• Responsiveness: willingness to help customers and provide prompt, timely service
• Assurance: employees must be knowledgeable, courteous, convey trust and confidence
• Empathy: caring, individualized attention
• Tangibles: appearance of physical facilities, equipment, personnel, communication material