Strategic Brand Management Chapter 1

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Questions and Answers

Which brand had the highest value in 2017?

Coca-Cola

Google

Apple (correct)

Microsoft

Which brand experienced the largest percentage increase in brand value in 2017?

Microsoft

Samsung

Amazon

Facebook (correct)

What was the brand value of Microsoft in 2017?

141,703$m

64,796$m

46,829$m

79,999$m (correct)

Which automotive brand had a decrease in brand value in 2017?

Toyota Signup and view all the answers

Which sector did Coca-Cola belong to in 2017?

Beverages Signup and view all the answers

What distinguishes a brand from a product?

A brand can carry symbolic and emotional meaning. Signup and view all the answers

Which of the following is NOT a level of meaning for a product?

Superior product level Signup and view all the answers

What is a primary function of brand elements?

To identify and differentiate a product Signup and view all the answers

Why are brands considered important in marketing?

They create customer loyalty and recognition. Signup and view all the answers

Which statement accurately describes brand equity?

Brand equity reflects the value a brand adds in the eyes of consumers. Signup and view all the answers

What are brand challenges typically related to?

Overcoming market saturation Signup and view all the answers

In the strategic brand management process, which step comes after identifying brand challenges?

Creating a brand strategy Signup and view all the answers

What is considered a tangible aspect of brand differentiation?

Product performance Signup and view all the answers

Which company has the highest brand value as a percentage of its overall value?

Mercedes Signup and view all the answers

What is one primary function brands serve for consumers?

Identify the source or maker of the product Signup and view all the answers

What is the brand value of Microsoft as mentioned in the data?

$79.9 billion Signup and view all the answers

Which of the following categories does NOT represent a type of good based on product attributes?

Intangible goods Signup and view all the answers

Which brand value is associated with Amazon in terms of total value?

$563.5 billion Signup and view all the answers

What is the primary requirement for branding a product?

Giving it a name and identifying elements Signup and view all the answers

How do brands reduce risks for consumers when making product decisions?

By providing assurance against various types of risks Signup and view all the answers

What benefit do brands offer firms regarding inventory?

Facilitate product handling and tracking Signup and view all the answers

What is a common industry where branding has been adopted according to the content?

Industrial business-to-business (B2B) products Signup and view all the answers

Which of the following is NOT a function of brands for consumers?

Setting unreasonable expectations Signup and view all the answers

Which company has the lowest brand value percentage in the provided data?

Amazon Signup and view all the answers

What competitive advantage do brands provide to firms?

Create barriers for competitors Signup and view all the answers

According to the data, which company has a brand value of $69.7 billion?

Coca-Cola Signup and view all the answers

What percentage of brand value does Google represent of its total value?

19% Signup and view all the answers

What role do brands play in terms of legal protection for firms?

Protect unique features or aspects of a product Signup and view all the answers

Which of the following best describes the symbolic role of brands?

Serve as a quality signal Signup and view all the answers

What effect does lower search costs for information have on consumers?

Consumers become less brand loyal. Signup and view all the answers

What challenge do brand marketers face due to ubiquitous digital connectivity?

Consumers becoming resistant to marketing efforts. Signup and view all the answers

Which phenomenon allows consumers to openly share their preferences for products?

Social media platforms. Signup and view all the answers

How has the digital world affected competition in new markets?

Increased competition due to lower entry barriers. Signup and view all the answers

What does disintermediation refer to in the context of service delivery?

Reduction or elimination of intermediaries. Signup and view all the answers

What is reintermediation?

The introduction of new intermediaries with additional roles. Signup and view all the answers

Which of the following is an example of peer-to-peer sharing?

Airbnb. Signup and view all the answers

What is a potential outcome of consumers' backlash against marketers?

Development of software to block advertising. Signup and view all the answers

How has the Internet influenced consumers' approach to evaluating product quality?

It has reduced reliance on brands as signals of quality. Signup and view all the answers

In a winner-take-all market, which statement is true about market leaders?

They are likely to be chosen at an even greater rate. Signup and view all the answers

What has led marketers to invest more in nontraditional forms of communication?

The erosion and fragmentation of traditional advertising media. Signup and view all the answers

What can threaten brand equity according to customer experiences?

Unverified product and service claims. Signup and view all the answers

What is a primary outcome of having strong brand equity?

Improved ability to engage in diverse marketing strategies. Signup and view all the answers

Which of the following is NOT a step in the strategic brand management process?

Measuring Financial Performance. Signup and view all the answers

What is a significant factor for brands to succeed in the current market landscape?

Quick adaptation to changing customer tastes and desires. Signup and view all the answers

How does brand equity create value for a firm?

By providing leverage to implement diverse marketing strategies. Signup and view all the answers

Study Notes

Strategic Brand Management: Building, Measuring, and Managing Brand Equity

The book is titled Strategic Brand Management: Building, Measuring, and Managing Brand Equity, Fifth Edition, Global Edition
The book was published by Pearson in 2020
The authors are Kevin Lane Keller and Vanitha Swaminathan
The first chapter is titled "Brands and Brand Management"

Learning Objectives

Define "brand," how brand differs from a product, and explain brand equity
Summarize the importance of brands
Explain how branding applies to various entities
Describe the main challenges and opportunities in branding
Identify the steps in the strategic brand management process

What is a Brand?

Brand elements are crucial for creating a brand
Brands are differentiated from products
Brand elements differentiate a brand

Brand Elements

Brand elements include name, logo, symbol, package design, or other characteristics that identify a product
Brand elements distinguish a product from other products

Brands Versus Products

Products offer five levels of meaning: core benefit, generic product, expected product, augmented product, and potential product
A product is anything offered for market attention, acquisition, use, or consumption
A brand goes beyond a product, offering differentiating dimensions

Brands Versus Products (continued)

Differences between a product and a brand may include rationality and tangibility (related to performance) or symbolism and emotion (related to brand representation)

Figure 1-2: Ten Firms Rated Highly in Innovation

The ten companies are Apple, Netflix, Square, Tencent, Amazon, Patagonia, CVS Health, The Washington Post, Spotify, and NBA
This list was based on Fast Company's 2018 List of Most Innovative Companies

Why Do Brands Matter?

Brands are important for both consumers and firms

Consumers (1 of 3)

Brands help consumers identify the source and maker of a product
Brands simplify product decisions
Brands lower search costs
Brands set reasonable expectations

Consumers (2 of 3)

Brands can signal product characteristics and attributes
Product attributes can be categorized as search goods, experience goods, and credence goods

Consumers (3 of 3)

Brands can reduce product decision risks
These risks are categorized into functional, physical, financial, social psychological, and time

Firms

Brands help firms simplify product handling and tracing
Brands help firms organize inventory and accounting records
Brands offer legal protection for unique product features
Brands provide predictability and security of demand
Brands create barriers to entry for competitors
Brands provide a means for securing competitive advantage

Figure 1-3: Roles That Brands Play

Consumers: Identify source, reduce risk, reduce search costs, make a promise
Manufacturers: Simplify handling, protect unique qualities, signal quality

Figure 1-4: Brand Value as a Percentage of Market Capitalization

Shows brand values as a percentage of overall company value for several different companies

Can Anything Be Branded? (1 of 2)

Physical goods
Services

Can Anything Be Branded? (2 of 2)

To brand a product, tell consumers who the product is and what it does
Marketers should give consumers a brand label and a meaning for the brand

Physical Goods

Physical goods are traditionally associated with brands
Examples include Mercedes-Benz, Nescafé, and Sony

Services

Branding a service can signal that the service offering is special

Retailers and Distributors (1 of 2)

Brands generate consumer interest, patronage, and loyalty
Brands create an image and positioning in an industry
Brands yield higher price margins, increased sales volumes, and greater profits

Retailers and Distributors (2 of 2)

Retailers introduce their own brands through store names, new names, or combinations
Private label brands increase customer loyalty and generate higher margins

Digital Brands

Some of the strongest brands are born online (e.g., Amazon, Google, Facebook, Twitter)
Brand building is critical for online marketers, who need unique brand aspects and satisfactory performance

People and Organizations

A product category can be a person or organization
Naming of people or organizations as brands is usually straightforward
The key is that people outside an industry know the person or organization and their skills

Sports, Arts, and Entertainment

A special case of marketing people and organizations as brands exists in the sports, arts, and entertainment industries
Sports marketing is sophisticated, and branding is valuable for arts
Movies are often branded with recurring characters and stories

Geographic Locations

Increased mobility of people, businesses, and tourism contribute to the rise of place marketing
Cities, states, regions, and countries promote themselves through advertising and other tools

Ideas and Causes

Numerous ideas and causes are branded, especially by nonprofit organizations
These can be captured in a phrase, slogan, or symbol

What are the Strongest Brands?

Strongest brands are generally best known and highly regarded
Brand relevance and differentiation are crucial for success

Figure 1-5: Twenty-Five Most Valuable Global Brands (1 of 2) and (2 of 2)

Data regarding top 25 most valuable global brands list
Gives information about ranking, company name, industry, value, and percentage increase or decrease from the previous year

Branding Challenges and Opportunities

Unparalleled access to information and new technologies
Downward pressure on prices
Ubiquitous connectivity and the consumer backlash
Sharing information and goods
Unexpected sources of competition
Disintermediation and reintermediation
Alternative sources of information about product quality
Winner-takes-all markets
Media transformation
Importance of customer-centricity

Unparalleled Access to Information and New Technologies

Technology created vast amounts of information
Brand marketers may use innovative features to design better experiences for customers

Downward Pressure on Prices

Lower search costs allow consumers to switch more easily to different brands, leading to more product commodification
This challenges brand marketers

Ubiquitous Connectivity and the Consumer Backlash

Ubiquitous connectivity makes consumers vulnerable to intrusions
Backlash from consumers can arise from increased resistance to marketing attempts
Software may thwart marketing efforts to reach consumers

Social media platforms allow consumers to connect and communicate preferences
But platforms face scrutiny by regulatory agencies
Many platforms have not obtained permission for customer data use
Peer-to-peer sharing (e.g., Napster, Airbnb, Zipcar)

Unexpected Sources of Competition

The digital world allows easier entry into new markets

Disintermediation and Reintermediation

Disintermediation is the decline or removal of intermediaries
Reintermediation introduces new intermediaries performing similar functions or additional roles

Alternative Sources of Information about Product Quality

The Internet provides alternative ways for consumers to learn about products and their quality
This reduces reliance on brands as a quality signal
Brands need to adapt to trends and changing customer desires

Winner-Takes-All Markets

Winner-take-all markets make it more likely that leading brands in categories will be chosen over other options

Media Transformation

Traditional advertising media has eroded
Interactive and nontraditional media has emerged
Marketers are spending more on new forms of communication (e.g., social media, paid influencers, sponsored bloggers)

The Importance of Customer-Centricity

Brand equity can be vulnerable if product and service claims aren't verified by actual experience
Examples of experiences include review forums, reviews from peers, and online word-of-mouth

The Brand Equity Concept

Differences in outcomes stem from "added value" endowed to a product
Added value can be created in many ways
Brand equity provides a framework for interpreting strategies and assessing value
Value can be exploited to benefit firms

Strategic Brand Management Process

Identifying and developing brand plans
Designing and implementing brand marketing programs
Measuring and interpreting brand performance
Growing and sustaining brand equity

Figure 1-10: Strategic Brand Management Process (Steps and Key Concepts)

Flowchart showing steps and key concepts of the brand management process

Designing and Implementing Brand Marketing Programs

Choosing Brand Elements
Integrating Brands into Marketing Activities
Leveraging Secondary Associations

Measuring and Interpreting Brand Performance

Implementing a brand equity measurement system, including brand audits, brand tracking studies, and brand equity management systems

Growing and Sustaining Brand Equity

Defining Brand Architecture
Managing Brand Equity over Time
Managing Brand Equity across Boundaries, Cultures, and Market Segments

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Description

Dive into the essentials of brand management with this quiz based on Chapter 1 of 'Strategic Brand Management: Building, Measuring, and Managing Brand Equity'. Understand key concepts such as brand definitions, brand equity, and the strategic brand management process. Test your knowledge on brand elements and their significance in differentiating a brand from a product.