Week 2 - Customer Based Brand Equity and Brand Positioning PDF

TOPIC 2: Customer-Based Brand Equity and Brand Positioning ========================================================== Defining Customer-Based Brand Equity: ------------------------------------- - Approaches brand equity from the perspective of the consumer - Stresses that the power of the bra...

TOPIC 2: Customer-Based Brand Equity and Brand Positioning ========================================================== Defining Customer-Based Brand Equity: ------------------------------------- - Approaches brand equity from the perspective of the consumer - Stresses that the power of the brand lies in what resides in the minds and hearts of consumers - Differential effect that the brand knowledge has on the consumer response to the marketing of the brand Notes: Brand equity: Brand value Consumers would be more willing to pay more for a brand compared to that has more value to them Customer-Based Brand Equity --------------------------- Differential effects: - Brand equity arises from differences in consumer response. - If no difference= competition becomes price based Brand knowledge: - Differences in response are a result of consumer knowledge about the brand Consumer's differential responses are reflected in: - Perceptions - Preferences - Behaviour To all aspects of the brand marketing including: - Choice of a brand - Recall of copy points from an ad - Response of sales promotion - Evaluations of proposed brand extension Marketing Advantages of Strong Brands: -------------------------------------- 1. Greater Loyalty (associate bleach with clorox) 2. Less vulnerability to competitive marketing actions 3. Less vulnerability to marketing crises 4. Larger margins 5. More inelastic consumer response to price increases 6. More elastic consumer response to price decreases 7. Greater trade cooperation and support 8. Increased marketing communication effectiveness (better marketing= spend less on advertising) 9. Possible licensing opportunities 10. Additional brand extension opportunities Brand equity as a "bridge" -------------------------- - Brand equity represents the "added value" endowed to a product as a result of ***past*** investments in the marketing brand - May be good or poor investments depending on whether they have created the right knowledge structures in consumer's minds - Brand equity provides direction and focus to ***future*** marketing activities - Consumers decide based on their brand beliefs and attitudes, where they think the brand should go and the success of future brand marketing  Making Brand Strong: Brand Knowledge ------------------------------------ Brand Knowledge has two components \> - Related to the strength of the brand node or trace in memory - Often a step-in building brand equity Brand image \> - Consumers' perceptions about a brand, as reflected by the brand associations held in consumer memory Brand Awareness --------------- - Related to the strength of the brand name node or trace in memory A screenshot of a computer Description automatically generated Brand Recognition ----------------- - Consumer's ability to confirm prior exposure to the brand when given the brand as a cue - Not searching online, only when at the shop E.g. You know what Yoplait is and recognize it at the supermarket Brand Recall - Consumer's 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 - Researching a brand= Brand recall important E.g. When thinking about smartphones, which brand comes to mind? Types of Brand Recall and increasing Brand Awareness There are 2 types of recall -- aided and unaided Anything that causes consumers to experience one of a brand's elements can increase familiarity and awareness of that brand element: - Name, symbol, logo, character, packaging, or slogan =, including advertising and promotion, sponsorship and event marketing, publicity and public relations and outdoor advertising Repetition increases recognizability - But improving brand recall also requires linkages in memory to product aspects Brand Image Once a sufficient level of brand awareness is created - Marketers can put more emphasis on crafting a brand image Creating a positive brand image - Takes marketing programs that link strong, favorable and unique associations to the brand memory Brand associations may either be brand attributes or benefits built based on: - Tangible (performance based) e.g. innovative - Intangible (abstract) e.g. creative, stylist, cool  Brand Positioning - Act of designing the company's offering and image to occupy - A distinctive place in the mind of the target market What does UQ stand for? What makes it stand out? - Does it have a good standing? - Better lectures? - Designated place for school? Brand positioning Define competitive frame of reference 1. Target market - Positioning to who? 2. Nature of competition - Positioning versus whom? Define desired brand knowledge structures 3. Points of difference - Strong, favorable, and unique brand associations 4. Points-of-parity - Necessary - Competition neutralizing Target Market Market Segmentation: Divides the market into distinct groups of homogeneous consumers who have similar needs and consumer behaviour Involves identifying segmentation bases and criteria: Criteria: - Identifiability - Size - Accessibility (e.g. perhaps not accessible through social media) - Responsiveness  A screenshot of a computer Description automatically generated Nature of Competition - Identify key competitors - Consumer-based market definition, not product-based - Avoid narrow product definition - Not railroad business, but transportation business - Not writing instruments business - Perceived substitutes - Interpersonal distance communication business (Telephone, VoIP, online chat, email, Twitter, Facebook) - Must identify substitutes Competitors for Qantas: Virgin, Jetstar, (planes) train and bus Points of Parity and Points of Difference A Marketer must arrive at the proper positioning: - This requires establishing the correct points-of-difference and Points-of-parity associations: Points of difference (PODs) - Formally defined as attributes or benefits that consumers strongly associate with a brand - Functional-performance related considerations - Abstract-imagery related considerations Points-of-parity associations: - Not necessarily unique to the brand but may be shared with other brands Points of parity - Points of parity are associations equal to that of competitors Category points of parity - Necessary but not necessarily sufficient (E.g. University has a campus) Competitive points of parity - Equal strength of a competitor (E.g. our prices are low also) Correlational points of parity - Negatively correlated attribute not true for our brand  Defining and Communicating the Competitive Frame of Reference Communicating category benefits: - Marketers use product benefits to announce category membership (e.g. Chobani- dog food) Exemplars: - Well-known, noteworthy brands in a category can also be used es exemplars to specify a brand's category membership (e.g. Chobani dog food category introduced by Bondi Vet Dr Kate Adams) Product descriptor: - Product descriptor that follows a brand name is often a very compact means of conveying category origin (e.g. Singapore Airlines) Updating Positions over time Generally, positioning should be fundamentally changed very infrequently - And only when circumstances significantly reduce the effectiveness of existing POPs and PODs Yet, positioning will evolve to better reflect market opportunities or challenges POD or POP may be refined, added, or dropped as situations dictate  A screenshot of a computer Description automatically generated Designing the Brand Mantra - The term brand functions describes the nature of the product or service or the type of experiences or benefits the brand provides - The descriptive modifier further clarifies its nature - The emotional modifier provides another qualifier -- how exactly dos the brand provide benefits, and in what way?