Brand Management Midterm Study Guide January 23, 2013 * Inter Brand’s Valuation Approach * The increasing recognition of the value of intangibles came with the continuous increase in the gap between companies’ book values and their stock market valuations, as well as sharp increases in premiums above the stock market value that were paid in mergers and acquisitions in the late 1980s. * The brand is a special intangible that in many businesses is the most important asset. This is because of the economic impact that brands have.
They influence the choices of customers, employees, investors and government authorities. In a world of abundant choices, such influence is crucial for commercial success and creation of shareholder value. * How much the brand is likely to earn for the company in the future? * Inter Brand Uses * Analyst’s projections * Company financials * Quantitative/ qualitative * To capture value of a brand * Market Segmentation * Financial Analysis * Demand Analysis * Competitive Benchmarking * Brand Value Calculation * 10 Principles of Brand Strength * Commitment – organization’s support Protection – legal & proprietary * Clarity – articulation * Responsiveness – evolve & renew * Authenticity – heritage, consistency * Relevance – target alignment * Understanding – 24/6 x 365 * Consistency * Presence – consumer “buzz” * Differentiation – distinct/ unique * Brand Strength * Gainers * Innovation * Emotional Connection * Investment * Value Proposition * Losers * Not In Tune * Unclear Brand Identity/ CVP * Lack of Investment
* Lack of focus on core * Conjoint Analysis * What features a brand should have and how should it be priced? * Steps * Collecting Tradeoffs Estimated buyer value systems * Making choice predictions * End Result = Quantitative Analysis of what consumers really want with each attribute evaluated in the context of the others; incorporating the trade offs * Brands make a CONNECTION with people and COMMUNICATE a DISTINCT ADVANTAGE January 28, 2013 * Decision Support Systems * A brand’s core is TRUST * Why is brand building hard? * Price Pressure * Abundance of Competition * Fragmented markets and media * Complex brand strategies * Bias toward changing strategies * Branding against innovation * Sin of complacency Short term pressure * Analyzing Customer Perceptions and Preferences * Favorite Brand demonstrates power of emotional elements and benefits that contribute to the strength of a brand in addition to the functional benefits Dolan Notes * Consumer Perceptions * Consumer insights tools business decisions * * Perception: “think” “see” * Preference: what they actually “buy” * Perceive Volvo as a safe car but don’t want to buy (preference) * Analyze how consumers “see” brand vs.
competitors * Set product positioning * New business opportunities Evaluate brand against competition * Is value prop and message clear? * Perceptual Research * + understanding of current position, visualizes gaps, guestimate perceptions, directs R&D * – static, no cost provision, not substitute for management judgment * Profile Analysis
* Snake plots/ spider maps * Effective with limited brands * Rate product/ brand on a scale * Compute average of responses & plot * Compare against other brands * Perceptual Mapping * Attribute space depicting pictoral rep of market data * Based on attributes or similarities Shows similarities or differences in relation of attributes according to consumer perception: Attribute Rating Method * Factor analysis * Hard attributes * Positioned on multi axis * Closeby – related * 90 degrees – largely unrelated * 180 degrees – trade off, little or no brand connection * Overall Simplicity method * When Quantitatively scaling attributes is difficult * MDS based on similarity inputs * Relative product positioning * Soft attributes * Consumer Preferences * What features? What price? * Concept testing * Reaction based, cost effective Positioning concept * Shows actual purchase choice * Core idea * Verbalizes theme of concept * How likely are you to buy this product? * Definitely, probably, maybe, doubtful, no * Frequency also evaluated * Conjoint Analysis * Insight based, complex, time consuming * Measures trade-offs and or options to a given concept * Product = bundle of attributes * What if situations to demonstrate what motivates consumers buying decisions * Collect data based on “intent to buy” and what attributes are important to consumer * Based on value system, products can be rated Consumers prefer to buy at the highest utility * Models * Diagnostic tools to aid measurement/ allow for deductive estimates of market performance * Different models may lead to different results for same issue * Can help define/ predict success of future marketing plan * Models of Sales Formation * Three Main Models * Taking overall sales and breaking it down into various categories of customers, categories that help brand manager develop focused marketing strategies * Trial Repeat Model: Market Share = Trial * Repeat
* Awareness * Distribution * Unaware Aware Trial Repeat Loyalty * Geoffrey Moore’s Diffusion of Innovation: * Production market position cycles vary in momentum and market share levels as marketers and consumers move across a formation curve * Each segment will require a different value proposition – growth stage for example will not be motivated by same factors that influence early adopters or innovators * Innovators, early adopters, early majority, late majority, laggards * Consumer Learning Models Qualitative interpretation of extensive consumer data * Attitudinal/ behavioral phases that impact consumer buying patterns/ gauge market performance * Learn (awareness & knowledge), feel (attitude & preference) & do (behavioral) * SOV = SOM (Shroer) * Greater level of ad spend = larger market share * Requires $$ commitment and LT spending * Variants: * Defensive/Offensive Tactic (Shroer Model) * Niche (david vs. Goliath) * Extraordinary Event (Superbowl)
January 30, 2013 DSS Marketing Impact Summary L’Oreal of Paris * Global Brand Extensions * Can L’Oreal bring “class to mass” in the US? \ * HQ in France, quality, innovation and geographic expansion * Technological innovation drives sales * Heavy commitment to build brand equity, consumer awareness and + impact on trade partners * Multichannel Strategy – Lancome and biotherm @ department & specialty stores and Plentitude @ mass market outlets * Star product and trickle down strategy Advertising strategy * Feature star product * Communicate technological superiority * USA tactics * Technological advanced products key * Introduce entire line at once 14 SKUs * Lever brand, distribution and placement from hair color group * Department store format, self-service outlet * Force full line purchase and eye level positioning next to oil of Olay * French ads translated directly to English * L’Oreal has lost money in all 8 years of opearyion * Market share has leveled off Plentitude “offers little” low market share in most product areas and not leading product * Hamilton realizes that it retails at premium price * Goals: top line growth, bottom line improvement, us market repositioning and maintain brand culture/ technology portfolio * Technologically advanced was exactly opposite to some of the essential attributes of skincare resultant skin feel and reasonable pricing (essential for a mass market product) * Low awareness to trial ratio compared to Olay and low repeat * Success/ failure * Share – less than half of Olay Pricing – premium to competitors
* Image – French communications translated to english! * Category Penetration – ignores the largest $$ segment of cleansers, focused on tech products * SOV = SOM: outspend the market per share point * Profit & loss – loss all years! * Problem Areas * Name * Product & packaging, price, age perceptions, shelf presentations * Analysis of Problem * Customer surveys – qualitative and quantitative (perceptual maps, brand awareness) * L’oreal brand name worked well for most people. Maybe expensive but good quality * Names should be less confusing Too many products – streamline portfolio * Packaging – expensive looking, too wordy * Target market unclear – older women? * L’oreal has an expensive brand association to it * Solution * Revitalift technology realted, age care product * Line scaled back their SKUs * L’Oreal name more prominent * Brand issues are not solved through $$$ discounts, new products, prmotions February 4, 2013 * Strong brands make a connection with people and communicate a distinct advantage * Brand identity: What you want your brand to stand for in the mind of the consumer * Aaker Brand needs to expand to remain relevant and lasting * Strategic planning – long term instead of ST tactical planning * Internal and external focus * Reis * Narrow fous to build strong brand * Periodic brand audit, new product branding choices * 12 dimensions grouped under 4 themes: product, person, organization and symbol * Core and extended identities * Help establish CVP with functional, emotional and/or self-expressive benefits Strategic Brand Analysis Brand Identity system Strategic Brand Analysis * Customer analysis (segmentation etc. * Competitor analysis * Self-analysis (existing image, heritage, strengths, abilities, values) Brand Identity system * Product – high recall when brand cued, quality, use * Person * Organization * Symbol Brand Image Traps * Brand Image Trap * Brand image becomes identity, consumer perception becomes primary * Brand Position trap * Brand identity becomes confused with singular promotional effort – functional benefits * External perspective trap * What company stands for becomes unclear internally * Product attribute fixation trap * Most common Product (attribute) becomes synonymous with brand
* Limits future potential * Non differentiated products, key attributes become competitive targets, limits change response * Use BRAND IDENTITY tool to break out of traps * Broad vs. narrow * Strategic vs. tactical * Internal vs. external February 6, 2013 * Aaker * Elements that make a brand differentiate, clarify and enrich its identity * Functional, emotional and self-expressive benefits delivered by the brand to deliver value to the consumers and creates brand – customer relationships * Functional benefit Product attributes functional utility to customer * Can be copies/ beat on price/ limit extensions * Expand the brand beyond the product * Include other types of benefits * Emotional benefit * Positive feelings * Richness and depth * Self – Expressive * Person to communicate their self-image * Strong connection with users * Kopp Notes on CVP * Price may imbalance CVP equation * Too high or too low skews emotional/ self-expressive benefits * Kop: value for the money? * Money spent on purchase, maintenance of products * Value = Benefit – cost OR Benefit/Cost Tools * Perceptual maps * Conjoint analysis * Value maps * * * Luxury for the Masses * Accessible super premium brands, old luxury brand extensions, masstige (b/wmass and class) * Masstige – b/w mass marketed products and niche luxury products * Bains Study * Organic Growth * Smart Cost Structure * Improved customer targeting February 11, 2013 * Brand Personality * Human characteristics associated with given brand * Associations that reflect consumer usage * Blends emotional and self-expressive benefits into a CVP * Aaker * The Big 5 * Sincerity Ruggedness * Competence * Sophistication * Excitement * Brand personality impacts BE * Self-Expression Model * Relationship basis model * Functional benefits representation model * Building Brand Personality – Kopp * Cultural relevance & image * Image and celebrity * Emotional ladder
* Values * Benefits * Attributes * Net of thinking and feeling associations * Gestalt concept (unified concept of brand personality) * Thinking based thoughts * Feelings based thoughts * Unique differentiator from competition February 13, 2013 Ducati Case * Case facts 95% male * Japanese cos, BMW – lagged in share leadership in ALL segments * Transportation 500cc * Premium price strategy * Few executive dealers, sales/dealer substandard in all markets * + designers, technology, product design, racing persona, loyal customer base with repeat * – no cash to pay, idle factories, unhappy employees, long lead time * Problems * CVP out of balance * Poor cash flow management * No marketing Plan * Bad channel strategy * Lack of management focus and solidarity * Brand Identity traps * Product attribute (desmo is a brand) External perspective (employees lost) * Brand image (quality?? ) * Solutions * Bring together F + E + SE * BP entertainment company * Internally/externally new BP * Build employee morale – no external perspective trap * Reposition to broaden market – escape brand image * Maintain and enhance r&d identity innovation driven escape attribute trap 1) Build BE a. Identify positioning and clarify diffrentiators b. Include BP in brand architecture 2) Optimize manufacturing c. Kaizen, JIT 3) Refocus R&D drive innovation February 19, 2013 Brand Equity – Kopp *
* Drivers and outcomes * CVP product performance/ features at a price = value * Value/ delivery = promotion & place * Authenticity reputation, longevity etc. * Brand Personality = gestalt of thinking + feeling * Brand Assets – trademarks etc. * Aaker * Types of consumer needs: functional, emotional, self-expressive * Set of assets linked to a brand’s name/ symbol that adds the value provided by a product or service to a consumer – awareness, association, quality, loyalty, “other” * Awareness is recall + recognition Graveyard model (high recognition, low recall) * Ultimate awareness (generic brands) * Association positive attitude/ feelings * Quality real vs. perceived * Loyalty = awareness + associations + quality * Other Assets – color, logo etc. February 20, 2013 * Rediscovering Market Segmentation * Black & Decker Case February 25, 2013 * The Brand Relationship Spectrum * Aaker * Alternatives in New Product Brand February 27, 2013 * Diesel Case March 4, 2013 * Diesel Recap * Big Idea in a Big Category? New Brand?
* Strategies to up market: * Low end premium range Differentiate, build in major different increments * Silver Bullet = upscale entry’s is to enliven old brand and give it cachet * Ad Spending: Growth Market Share * Your Brand’s Best Strategy FUZZY MATH 1. Market Share = Awareness x Trial x Repeat x Distribution 2. SOV = SOM 3. BI = Person + Organization + Symbol + Product 4. CVP = F + E + SE 5. Purchase Decision [PD] = Value + Consumer Relationships 6. Value = Benefits [functional + emotional + self-expressive] – Costs 7. Value = Benefits / Costs 8. Brand Essence (Brand Equity) = BI + CVP + BP 9. Brand position = BI + CVP+ BP 0. SOV = SOM [Shroer] 11. MS = BV + CP [Shroer] a. Brand value + consumer preference drives market share 12. Brand Profitability = MS + nature of the category b. MS increases = Profitability increases [Vishwanath] * Brand identity traps: * Brand image * Brand position * External perspective * Productive attribute Brand identity = personal + symbol + org + product Brand identity = core + extended CVP = functional + emotional + self-Expressive Kopp CVP = benefit – cost DSS BP’s effect on brand equity Aaker’s big 5 brand personality Excitement Ruggedness Sincereity Competence Sophistication
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Brand Management Study Notes. (2016, Oct 07). Retrieved from https://graduateway.com/brand-management-study-notes/