Basic concepts of Branding

Basic concepts of Branding

What is a brand?A name, term, design, symbol, or any other feature that identifies one seller's good or service as distinct from those of other sellers. The legal term for brand is trademark. A brand may identify one item, a family of items, or all items of that seller. If used for the firm as a whole, the preferred term is trade name

Thums upPepsiCoco colaAkshay KumarRanbir kapurShahrukh khanAmir khantaste thunder Yeh hai youngistaan meri jaan

Thanda Matlab Coca-Cola

What a brand means to common person ?

In 'blind' taste tests, people prefer the taste of Pepsi over the taste of Coke. However, if the test is not 'blind' and the tasters know which beverage is which, they prefer the taste of Coke over Pepsi! That is the emotional power of a brand.

When you cannot do thisThe product is a commodity

Commodities are bought on the basis of price and availability, not on the name of the manufacturer or brand. Example: Petrol, vegetables.However, by adding value, commodities can be converted into a brand.

A brand comprises of Tangible attributes Intangible attributes

TangiblesEg.ProductPackagingLabelingAttributesFunctional benefits

IntangiblesEg.QualityEmotional benefitsValuesCultureImage

Brand IdentityIt is the marketers promise to give a set of features, benefits and services consistently

Brand BuildingInvolves all the activities that are necessary to nurture a brand into a healthy cash flow stream after launch

What kind of activities?Eg.Product developmentPackagingAdvertisingPromotionSales and distribution

Brand EquityWhen a product becomes a brand, it is said to have equityElements that can be included in the valuation of brand equity include changing market share, profit margins, consumer recognition of logos and other visual elements, brand language associations made by consumers, consumers' perceptions of quality and other relevant brand values.

What is brand equity?The premium it can command in the marketDifference between the perceived value and the intrinsic value

Benefits of brand equityInclude:Brand name recognition or awarenessCustomer loyaltyPerceived qualityStrong emotional or mental associations

Brand equity as an assetCoca Cola$69bnMicrosoft$65bnDisney$32.6bnAmerican Express$17bnEricsson$7bn

What happens when equity increases?CommodityBrandPower Brands

Presence+Personality

What happens when brands have high equity?The company can have more leverage with the tradeThe company can charge a premium on their productThe company can have more brand extensionsThe company can have some defense against price competition

Brand Loyalty Pyramid

Committed buyer

Likes the brand. Considers it a friend

Satisfied buyer. Would incur costs to switch

Satisfied buyer/no reason to change

Switchers/Price sensitive

Functions of a brand:Creates brand awarenessReduces riskProvides specific information like qualityProvides symbolic consumption