2012-Branding Strategies and Brand Extension UPLOAD

7/31/2019 2012-Branding Strategies and Brand Extension UPLOAD

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April 26, 2012 Sanjay Patro 1

Branding Strategies and BrandExtension

Dr.Sanjay Patro


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Kapferers Brand Identity Prism

Physique Personality

Culture

Self ImageReflection(Perceived Client Type)

Relationship


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De Chernatony-McWilliam Matrix

Functionality

Representationality

L

ow

High

Low High


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Customer-Based Brand Equit y Model

Consumer-

BrandResonance

Brand Salience

ConsumerJudgments

ConsumerFeelings

BrandPerformance

Brand

Imagery

INTENSE, ACTIVE

LOYALTY

INTENSE, ACTIVE

LOYALTY

RATIONAL &EMOTIONALREACTIONS

RATIONAL &

EMOTIONALREACTIONS

POINTS-OF-

PARITY &POINTS-OF-

DIFFERENCE

POINTS-OF-

PARITY &POINTS-OF-

DIFFERENCE

DEEP, BROADBRAND

AWARENESS

DEEP, BROADBRAND

AWARENESS


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The Brand Iceberg


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MANAGING THE BRAND

PORTFOLIO Objectives:

Leverage commonalities to generate synergy

Reduce damage to brand identity

Obtain clarity of product offering

Enable change and adaptation

Guide resource allocations among brands

Source: Aaker, Building Strong Brands, 1996.


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Branding Strategies

Monolithic Approach

Endorsement Approach

Simple/Individual Approach


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Sony

2008 Rank: 252008 Brand Value (Millions): $13,583


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In 2008 the Fusion razor hit $1 billion insales faster than any other P&G brand.

Gillette is expanding its mens care

dominance with new hair and body-washproducts


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Major Branding Strategies


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Leveraging of Brands and BrandExtension Management

Dr.Sanjay Patro


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Classic conception of Branding

It does not differentiate the history of the brandfrom the reality of the brand

Al Ries and Jack Trout on Branding


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Brand Name Strategy

Free Standing

KodakSpeed-post

Associative

Toys R UsAMAZON


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Developing a Brand Extension

Strategy

1. Line Extension Strategy

Maximise coverage across offerings

Evaluate vertical price tier opportunities

2. Category Extension Strategy

Uncover new products that fulfill brand promise Ensure positive feedback effects

Allows to break from the mono-product

O f B d E i


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Outcomes of Brand Extensions

Effects of brand

extensions

Brand Name aidsthe extension

Extension enhances thebrand name

Brand Name fails

to help extension

New brand name is

foregone

Brand Name is

damaged


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Factors Af fect ing Brand Extensions

Strength of Parent Brand

Brand Loyalty Age of the Brand

Brand Knowledge and Awareness Perceived Quality

Brand Breadth

Intervening Extensions

Market Characteristics


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Life cycle of Brands

Brands originate as a new product or service


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Brand DNA


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Brand Product Matrix Brand Hierarchy

Corporate Brand Range Brand/Family Brand

Product-line Brand

Product Brand

Sub-Brands

Modifier Brand


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A strategic brand perspective requiresmanagers to be clear about what role brands

play for the company in creating customer

value and share-holder value.


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Brand Relationship Spectrum

Four options to brand an

acquired or

developed offering:

1. A house of brands2. Endorsed brands

3. Sub brands

4. A Branded house


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Brand Hierarchy Decisions In creating the hierarchy, it is important to

decide: The number of levels of the hierarchy to use in

general

How brand elements from different levels of thehierarchy are combined, if at all, for any oneparticular product

How any one brand element is linked, if at all, tomultiple products

Desired brand awareness and image at each level


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Brand Roles

Driver Endorser

Flanker Brands

Branded Energizers Low end entry

or high end prestige

Silver Bullets

Cash cows

Kissan Annapurna - Kissan Annapurna Annapurna


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Basic principle of brand portfolios Maximize coverage

Minimize overlap


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Brand Value Chain

BVC is a structured approach to assess thesources and outcomes of brand equity and

the manner by which marketing activities

create brand value.


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Brand Value Chain

Marketing

ProgramInvestment

Customer

Mindset

Market

PerformanceShareholderValue

Product

Communicn

Trade

Employee.

Awareness

Associations

Attitudes

Attachment

Price Premium

Price Elasticity

Cost savings

Market share

ExpansionSuccess

Stock Price

P/E Ratio

MarketCapitalization

Value stages


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Brand Value Chain

MarketingProgramInvestment

Customer

Mindset

Market

Performance

Shareholder

Value

Product

Communicn

TradeEmployee.

Awareness

Associations

Attitudes

Attachment

Activity

Price Premium

Price Elasticity

Cost savings

Market share

Expansion Success

Stock Price

P/E Ratio

MarketCapitalization

Multiplier Program

Quality

Market

Conditions

Investor

Sentiment


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Key Role of Line Extensions To meet the needs of each consumption

segmentformat extensions

To trade consumers up-vertical consumer extns To increase volume per capita-big foramt vs.small

sizes

To suppress barriers to consumption amongspecific targets

To extend the share of choices through newvarieties


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How are brands intersected with the daily

life of customers


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What innovations bring to brands

They become the content for communication

They become drivers of perceived quality

Create new segments to dominate

Demonstrate the brands permanent relevance

They stimulate behavioural loyalty


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Innovation is the life blood of the brand


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What brands bring to innovations

They induce trials because they are

reassuring

They reduce perceived newness

They bring their resources, trust ,power and

goodwill among distributors

They indicate in what directions theinnovations to be looked for


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What innovations for the brand?

Personality

Know-how

Attributes

Territory

Values

? ? ? ? ?


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Thank You

St rategic Brand Management


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St ateg c a d a age e t

Brand I dent it y

I dent i t y I mplementat ion

Brand St rategy OverTime

Managing t he Brand

Portfolio

Leveraging t he Brand

BrandEquity

StrategicBrand

Analysis


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Value Chain of a Brand

Brands energy must be focused

downstream at contact points with

customers


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Brands and the Time Challenge

Changing to survive


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Innovations should not be in terms of only

product features but for better customer

experiences

Apple stores have become hangout placesfor young customers

Kingfisher benchmarking against Singapore

airlines


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Measurement of Brand Equity

Dr.Sanjay Patro


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Measures of Brand Equity


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Brands on the balance sheet ???????

A new conception of Brand


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Far better an approximate answer to the

right question,which is often vague,than an

exact answer to the wrong question, which

can always be made precise. John Tukey,Statistician


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Rank- Name Country 2008 Brand


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Rank-

2008

Name Country 2008 Brand

value in $bn1 Coca Cola US 66.66

2 IBM US 59.03

3 Microsoft US 59.00

4 GE US 53.08

5 Nokia Finland 35.94

6 Toyota Japan 34.05

7 Intel US 31.268 McDonalds US 31.04

9 Disney US 29.25

10 Google US 25.59

Samsung


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2008 Rank: 212008 Brand Value (Millions): $17,689


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Cost Based Methods

Price Based

Consumer Based

All Definitions Available on Brand Equity can

be Divided into Three Categories

C B d A h


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Cost Based Approaches

Valuation by Historical cost

Valuation by Replacement Cost

Valuation by Market Price Method

Discounted Cash Flow Method


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Brand Asset Valuator

Differentiation Relevance

Esteem

Knowledge

Brand Strength and Brand Stature

A Two Dimensional Framework for


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BrandAssetValuator

Leading

Brand Strength

Differentiation Relevance

Lagging

Brand Stature

Esteem Knowledge

Diagnosing Brands: The PowerGrid

B d E it T D id A k


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Brand Equity Ten : David Aaker

Loyalty Measures

Price Premium

Satisfaction/loyalty

Perceived Quality/Leadership Measures

Associations/Differentiation Measures

Perceived Value

Brand Personality

Organizational Associations


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Awareness Measures

Brand Awareness

Market Behavior Measures

Market Share

Price and Distribution Indices


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Brand Equity=Weighted Av. OfBrand Profits*P/E of

Industry*Brand Strength


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Interbrands Approach

Leadership 25

Stability 15

Market 10

International 25

Trend 10

Support 10

Protection 5

Method of Valuing Brand Strength

FACTORS MAXM. SCORE


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Multiple measures and methodsshould be used to assess the

multiple outcomes of brandequity.


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100%

89%

85%

84%

68%

99%

84%

77%

64%

8%

89%

75%

65%

45%

2%Bonding

Advantage

Performance

Relevance

Presence

Brand power in India

CDM Munch Kit Kat

Source: IMRB U&A Study

Strategic Brand Management Process


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Mental maps

Competitive frame of reference

Points-of-parity and points-of-difference

Core brand values

Brand mantra

Mixing and matching of brand elements

Integrating brand marketing activities

Leveraging of secondary associations

Brand Value Chain

Brand audits

Brand trackingBrand equity management system

Brand-product matrix

Brand portfolios and hierarchies

Brand expansion strategiesBrand reinforcement and revitalization

KEY CONCEPTSSTEPS

Grow and Sustain

Brand Equity

Identify and Establish

Brand Positioning and Values

Plan and Implement

Brand Marketing Programs

Measure and Interpret

Brand Performance

Brand Management Challenges*


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Internal and external forces create hurdles forproduct brand managers in their brand buildinginitiatives:

I nt ense Pr ice and Other Compet it ive Pressures

Fragment at ion of Market s and Media

Complex Brand St rategies and Relat ionships

Bias Against I nnovat ion

Pressure t o I nvest Elsew here

Shor t -Term Pressures*David A. Aaker, Building Strong Brands, 1996, 26-35.

Responsibility for ManagingProducts


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Product/Brand Management

Planning, managing, and coordinating the strategy

for a specific product or brand

Product Group/Marketing Management

Product director, group manager, or marketingmanager

Product Portfolio Management

Chief executive at SBU

Team of top executives

Market ings Role in Product


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Strategy1. Market sensing

2. I dent ifying t he character ist ics andperformance feat ures of product s

3. Guiding t arget market and program-posit ioning st rat egies

St rategic brand management decisions arerelevant t o all businesses, includingsuppliers, producers, w holesalers,

dist r ibut ors, and retailers.

St rategic Brand Analysis


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Analyses Product Product Line Portfolio of Product Lines

Market andCustomer

Competition

Brand(s)


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Tracking Product PerformanceSet Performance

Objectives

Select Method( s) forProduct Evaluat ion

I dent ify ProblemProducts

Decide How toElim inate t he

Problems

Brand Equit y


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Effective strategic brand management requires thatwe understand brand equity and evaluate its impactwhen making brand management decisions:

Brand equity is a set of brand assets

and liability linked to a brand, its name,and symbol, that add to or subtractfrom the value provided by a product or

service to a firm and/or to that firmscustomers.*

* David A. Aaker, Managing Brand Equity, The Free Press, 1991, 15.**Ibid, 102-120.


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Measuring Brand Equity . Several measures are needed to capture all relevant aspects of brand

equity.

loyalty (price premium, satisfaction/loyalty), perceived quality/leadership measures (perceived

quality, leadership/popularity),

associations/differentiation (perceived value, brand

personality, organizational associations), awareness (brand awareness), and

market behavior (market share, price and

distribution indices).

These components provide the basis for developing operationalmeasures of brand equity.

Strategies for Improving ProductPerformance


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Product mix st rategy

Product lineStrategy

Addnew

product(s)

Costreduction

Productimprovement

Altermarketingstrategy

Eliminatespecific

product(s)

Delete

productline(s)

Changeproduct line

riorities

Add new

productline(s)

Strategies for Brand Strength


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Strategies for Brand Strength Brand-Building Strategies

Developing the brand identification strategy

Coordinate identity across the organization

Brand Revitalization

Find new uses for mature brands

Add products related to heritage

Strategic Brand Vulnerabilities

Brand equity can be negative Retailer private brands compete with manufacturer brands

Major shifts in consumer tastes

Competitive actions

Product Mix Modifications


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Motivation for changing the product mix: Increase the growth rate of the business

Offer a more complete range of products to

wholesalers and retailers

Gain marketing strength and economies in

distribution, advertising, and personal selling Leverage an existing brand position

Avoid dependence on one product line or

category

Brand Leveraging St rat egy


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BRANDEXTENSI ON

LINEEXTENSI ON

Extensions of t he brandname to other productcategories

--Similar

--Dissimilar

Minor var iant s of a single

product are marketed undert he same brand name

BRAND LEVERAGI NG


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EVALUATI ON CRI TERI ABrand Relevance/Differentiation

Capabilities/Perceived Value MatchMarket/Segment Opportunity

Cannibalization RisksPotential for Core Brand Damage

Clarity of Product Offerings

Estimated Financial Performance

Brand Equity Impact


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Current


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April 26, 2012 Sanjay Patro 80Ansoffs Product Market Grid

Market Penetration

Strategy

Product Development

Strategy

Market Development

Strategy

Diversification Strategy

CurrentMarkets

New

Markets

Products NewProducts


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Double Jeopardy Effect Strong brands grow by penetration and

loyalty

Major brands have high penetration higher

per capita usagehigher loyalty

Double Jeopardy effect


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Brand image is not equal to brand usage

Adoring your brand wont lead to increased

brand usage

Segmenting markets by situations to


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grow the brand

Products are always consumed in specific

situations and contexts

Here we segment the battlefield not theconsumers who move through different

situations during the same day

When A Firm Introduces A New


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Product1. It can develop a new brand

2. It can use one of its existing brands

3. It can use a combination of a new brandwith an existing brand

4. It can join hands with an outsider to takethe product forward to the market


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We were successful because our goal was to

get more people to buy more stuff , moreoften so that the company can make more

moneySergio Zyman,VP of Cocacola during New Coke

launch in 1984

Documents

2012-Branding Strategies and Brand Extension UPLOAD