What is Branding Strategy?
Branding strategy for a firm reflects the number and nature of common and distinctive brand elements applied to the different products sold by the firm.
Breadth of Branding Strategy Nature & number of different products linked to
the brands sold by the firm Considerations include:- Which products the firm should manufacture and
sell. Eg: Should Lacoste launch a women’s line? - How many diff. product lines the firm should
carry (Breadth of product mix)- How many variants should be there in each
product line (Depth of product mix)
Depth of Branding Strategy Number & nature of different brands
marketed in the product class sold by the firm.
Multiple brands in the same product category increase market coverage. GM pioneered it; now everybody does it!
Building equity at different levels
Corporate or company level Family brand level Individual brand level Modifier level Product descriptor
Why is corporate image important? Look what happened to Satyam? Raju’s scam has led to
a crash in Satyam prices & international clients like Caterpillar are withdrawing
For a good 100 years the Tata’s were the most respected name in Indian business – that they are ethical, concerned about society etc. Tata fiasco in Singur has made a dent in that image. Effects will be visible in years to come. Already NGOs oppose them more vociferously than others when they plan a new project now
Phanesh Murthy was overall head of marketing for Infosys in N. America. Lady employee filed sexual harassment charges against him. Infosys immediately sacked him to avoid any impact on business there
To sum up, the only sustainable competitive advantage any business has is its “reputation”…
A large global survey of financial analysts indicated that 91% of the sample agreed that a company that fails to look after its reputation will endure financial difficulties; another 96% said that CEOs reputation was fairly responsible for influencing their ratings
Interbrand found that a strong corporate brand could improve a company’s stock price by 5-7% in a bull run and mitigate losses in a bear market. Look at how well the public sector banks performed in the stock market during this slowdown.
The realization that consumers are interested in issues far beyond the product, its physical attributes & associations has led marketers to focus more strongly on establishing & maintaining a proper corporate image
Building equity at corporate or company brand levelDeterminants of corporate image: Corporate social conduct Corporate contributions’ conduct Corporate employees conduct Company business conduct Sales Force (training retailers) Distribution channels (and so the trend toward EBOs) Service (Nike shopkeeper example) Support Price Communications Product
Corporate Brands cont. Corporate branding is usually only successful if
the company is well known and sells reputable products with a positive image. One of the disadvantages of corporate branding is that the company can become identified with only one type of product.
On the other hand, by using corporate branding with a successfully marketed product, a company can familiarize consumers with its products and may create brand loyalty. If the public likes one product from this company, then they may seek out the brand name when buying other products
Family brand levelWhy are family Brands Used? As products become more dissimilar, it may be harder
for corporate brands to still retain any product meaning to effectively link the disparate products
Distinct family brands can evoke a specific set of associations across a group of related products: common product attributes, benefits, attitudes, people & relationships
Cost of introducing a may be lower & the likely-hood of acceptance can be higher when an existing family brand is used to brand a new product
However, overstretched family brand may become weaker & less favorable
Failure of product may have adverse ramifications Example (HUL family brands): Lakme (crème, lipsticks,
nail polish, etc), Fair & Lovely (creme, gel, soap)
Individual brand level Essentially restricted to one product category,
although available in multiple product types or models, packs, flavors…
Advantages: Marketing activities can be customized All brand elements focused on target audience No risk to other brandsDisadvantages: Expensive. Are adequate resources made
available? Example: Individual brands for HUL: Surf
Excel, Rin, Wheel, Pureit
Modifier level These are further distinguished brands according to the
different types of items or models involved:
- Johnnie Walker Red Label
- Johnnie Walker Black Label Communicating how different products within a
category, with same brand name, differ in one or more significant attribute or benefit dimensions
Help make products more understandable and relevant to consumers & even trade
Example: Dell Inspirion XPS, Maruti WagonR AX (fully automatic)
Product descriptors
These may also be an important ingredient of branding strategy
They help define relevant competition in consumers’ minds
New product with a familiar brand name facilitates basic familiarity and comprehension by consumers
To sum up… One brand name may be used for a number of
products in family branding, or all the products may be given different brand names in a practice called individual branding.
When large retailers buy goods in bulk and then put their own brand name on them, this is called store branding, label branding, or private branding.
Co-branding is when two or more manufactures combine to sell their products.
When a company sells the right to use their brand name to another company for use in another location or for non-competitive purposes, this is called brand licensing.
Corporate Image Dimensions Or types of associations that can be made
at corporate brand level:
a. Common product attributes or benefitsb. People & Relationshipsc. Values & Programsd. Corporate Credibility
a. Common product attributes or benefits
AS WITH INDIVIDUAL BRANDS, A CORPORATE OR COMPANY BRAND MAY EVOKE PERFORMANCE OR IMAGERY ATTRIBUTE OR BENEFIT ASSOCIATIONS AS WELL AS JUDGMENT & FEELING ASSOCIATIONS:
Corporate brand may evoke strong associations with consumers to:a. A product attribute (e.g., Cadbury’s with “chocolate”)b. Type of user (e.g., BMW with “yuppies”)c. Usage situation (e.g., Kingfisher with “good times”)d. Overall judgment (e.g., Sony, Toyota, Honda with “quality”)
See Honda Ad
IF A CORPORATE BRAND IS LINKED TO PRODUCTS ACROSS DIVERSE CATEGORIES, THEN SOME OF ITS
STRONGEST ASSSOCIATIONS ARE LIKELY TO BE THOSE INTANGIBLE ATTRIBUTES, ABSTRACT BENEFITS, OR
ATTITUDES THAT SPAN EACH OF THE DIFFERENT PRODUCT CATEGORIES:
Associated with products/services that have a great service orientation e.g. Maruti Suzuki
Bring excitement & fun to certain activities e.g., Apple Built with the highest quality standards e.g., Toyota Represents market leadership, e.g., Nokia
Two specific product-related corporate associations:- high quality &- innovation
a. Common product attributes/ benefits cont.
A HIGH-QUALITY CORPORATE IMAGE ASSOCIATION INVOLVES THE CREATION
OF CONSUMER PERCEPTION THAT A COMPANY MAKES PRODUCTS OF
THE HIGHEST QUALITY:
A number of different organizations rate brands on the basis of quality:- products, e.g., J.D.Power, Consumer Reports,..- companies, e.g., Malcolm Baldridge award
a. Common product attributes/ benefits cont.
AN INNOVATIVE CORPORATE IMAGE ASSOCIATION INVOLVES THE CREATION OF
CONSUMER PERCEPTIONS OF A COMPANY
AS DEVELOPING NEW & UNIQUE
MARKETING PROGRAMMES, SPECIALLY W.R.T.
PRODUCT INTRODUCTIONS OR IMPROVEMENTS
Being innovative is seen in part as being modern & up-to-date, investing in R&D, employing advanced manufacturing capabilities & introducing new features
This is becoming an image priority for many companies, e.g. Apple, Canon, 3Ms, Toyota…
a. Common product attributes/ benefits cont.
b. People & Relationships
CORPORATE IMAGE ASSOCIATIONS MAY REFLECT CHARACTERISTICS OF THE
EMPLOYEES OF THE COMPANY: Natural positioning strategy for services firms:
- Vodafone: Happy to Help- Honda: Ads show happy employees - Maruti Suzuki
Manufacturing firms such as DuPont & others have also focused attention on their employees in communication program
See some HR ads in Ascent: ‘great places to work in’; attract talent + build equity
CUSTOMER-FOCUSED CORPORATE IMAGE ASSOCIATION INVOLVES THE
CREATION OF CONSUMER PERCEPTIONS OF A COMPANY AS BEING RESPONSIVE TO & CARING
ABOUT ITS CUSTOMERS:
* “Listening” to customers & having their best interest in mind
b. People & Relationships cont.
c. Values & Programs
Concern with environment:
EG: Coca Cola India (water purification plants)
Social Responsibility:
- ITC e-Chaupal- Infosys Foundation (runs schools)- Tata Tea (Jaago Re)
d. Corporate Credibility
Expertise: EG: HCL, RPower IPO success because of heavy communication showing corporate lineage/ expertise (RPower sold out its IPO in less than a minute; It was oversubscribed 69 times the stock on offer on the final day, raising about $3 billion from investors (equivalent to the combined market value of the Portuguese and Czech stock markets)
Trustworthiness: EG: Infosys Likeability: EG: Amul
DESIGNING A BRANDING STRATEGY
Number & Levels of Brand Hierarchy Desired Awareness & Image at each
Hierarchy Level Combined Brand Elements at Different
Levels Linking Brand Elements to Multiple
Products Adjustments to the Marketing Program
HAVING ESTABLISHED CORPORATE IMAGARY, NEXT TASK IS TO DECIDE ON
BRANDING OPTIONS AT DIFFERENT LEVELS OF BRANDING HIERARCHY
AT EACH LEVEL, A FIRM HAS A NUMBER OF BRANDING OPTIONS AVAILABLE TO IT, DEPENDING ON HOW EACH LEVEL IS
EMPLOYED, IF AT ALL
HOW TO USE DIFFERENT LEVELS OF BRAND HIERARCHY TO BUILD BRAND EQUITY
Brand elements at each level of hierarchy may contribute to brand equity through their ability to create awareness as well as foster strong, favorable, & unique association & positive responses
Challenge is in setting up brand hierarchy & arriving at a branding strategy is to:a. Design the proper brand hierarchy in terms of number of brand elements to use at each level, &b. Design the optimal supporting marketing program in terms of creating the desired amount of brand awareness & type of brand association at each level
Hence guidelines, since brand strategy needs decisions on these lines
THERE IS NO UNIFORM AGREEMENT
ON THE ONE TYPE OF BRANDING
STRATEGY THAT SHOULD BE
ADOPTED BY ALL FIRMS
FOR ALL PRODUCTS
Guidelines for brand hierarchy decisionsRemember “SRDPC”
1. Decide on the number of levels:- Principle of Simplicity: employ fewest levels possible
2. Decide on the levels of awareness & types of associations to be created at each level:- Principle of Relevance: create abstract associations that are relevant across as many individual items- Principle of Differentiation: differentiate individual items & brands
3. How to link brands from diff. levels for a product:- Principle of Prominence: relative prominence of brand elements affect perceptions of product distance & type of image created for new products
4. Decide on how to link a brand across products:- Principle of Commonality: more common elements shared by products, the stronger the linkages
Principle of SimplicityBased on need to provide the right amount of information to consumers & desired no. of levels of the brand hierarchy. Depends on the complexity of the product line or product mix associated with a brand:
Simple, low-involvement products: branding strategy consists of an individual or family brand combined with modifiers that describe differences in product features. EG: Bajaj Electricals: Bajaj Bulbs and Bajaj Tubes
Complex set of products: more levels of hierarchy are necessary, but over 3 levels are confusing:
In such cases, a better approach is to introduce multiple brands at the same level (e.g., multiple family brands - Dove, Lux, Pears ) & expand
depth of branding strategy (nature & number of different brands marketed in product class sold by firm).
Principle of Simplicity cont. Simple, low-involvement products Sub-branding: provides right amount of
branding information to consumers Modifiers: family/individual brands
combined with modifiers that describe the differences in the product features for simple, low-involvement products
Complex products With more than three levels of branding, it is preferable to introduce
multiple brands at same level:
e.g. Corporate Brand: Maruti SuzukiCar types Brand Modifier
Hatchback Swift LXI, VXI, Glam, LDI Hatchback WagonR AX,LX,VXI Hatchback Ritz LDI, VDI, LXI,VXI, XZI
Clearly Maruti Suzuki displays a great depth of branding strategy
Principle of Simplicity cont.
Principle of RelevanceBased on advantages of efficiency & economy, desirable to create associations that are relevant to as many brands as possible. For example:
Nike’s slogan (Just Do It); Reebok’s (Do More) reinforces one key point of difference for the brand-performance that is relevant to virtually all the products these brands sell (sports shoes, equipment, clothes)
More abstract the association, more likely it is to be relevant to different product settings (Amul: the taste of India; ICICI: Hum Hain Na, Microsoft: Originality)
Sometimes creating a strong association with one category, restricts brand’s transfer to other categories. Remember when Xerox launched Xerox Computers? Unsuccessful coz strong association with copiers
Principle of Differentiation … is based on disadvantages of redundancy. In
general, it is desirable to distinguish brands at the same product/ category level as much as possible:
a. Breeze: Flowers; b. Ayush: Herbal; c. Dove: Not soap; it’s a moisturizer; d. Hamam: Neem; e. Lifebuoy: Germs f. Liril: Freshness; g. Lux: Film stars, seductive; h. Rexona: Energy; i. Pears: Natural family soap
If two brands can’t be distinguished, then it may be difficult for both retailers and consumers to justify supporting both brands
Linking different product levels
If a sub-brand strategy is adopted, how much prominence should individual brands be given at the expense of corporate/family brand?
5 possible ways according to Gray & Smeltzer:1. Single entry: Image of company & product same (e.g.
Federal Express) 2. Brand dominance: Not to relate brand & corporate names
(e.g., ITC to Gold Flake, Wills)3. Equal dominance: Neither dominates (e.g., Suzuki
dominates at company level, with individual brand dominating at their level – Swift, SX4, WagonR, Alto)
4. Mixed dominance: ADAG for instance uses its corporate name in some products but not in others like BIG
5. Corporate dominance: Xerox, GE…
Principle of Prominence Primary brand elements should be chosen to convey
the main product positioning & POD Secondary brand associations chosen for secondary
role to convey more restricted set of associations such as POP or perhaps additional POD:- may also facilitate awareness
Example Canon Rebel 35 mm camera:- principle brand element “Rebel” name reinforcing
user & user imagery- secondary brand element, camera name Canon,
ideally conveys credibility, quality, and professionalism- See Swift ad and determine prominence for family/ individual brand vis-à-vis corporate brand
If corporate or family brand made more prominent, its association is bound to dominate
If individual brand name more prominent, it is easier to create a more distinct brand image:- conveys to consumer new product as closely linked to other products that share its name (family/corporate)- consumers less likely to transfer corporate or family brand- success or failure of new product less likely to affect parent brand as opposed to prominent corporate/family name
Finally, in some cases, brand elements may not be linked at all EG: Garnier (L’Oreal)
Principle of Prominence cont.
A brand endorsement strategy is when brand element appears on the packaging, signage, or product appearance in some way but is not directly included as part of the brand name:
- Often this distinct brand element is the corporate brand name or brand logo
Brand endorsement strategy presumably establishes the maximum distance between the corporate or family brand & individual brands, suggesting that it would yield the smallest transfer of brand associations to the new product but, at the same time, minimize the likely-hood of any negative feedback effects
See Nestle Munch ad
Principle of Prominence cont.
Principle of CommonalityMore common brand elements shared by the products, the stronger the linkages between the products:
Simplest way – use brand elements “as is” across different products
Other combinations. For example: Using a prefix, suffix:
-- HP capitalizes on its highly successful LaserJet computer printer to introduce a number of new products using “Jet” suffix, like DeskJet, PaintJet, ThinkJet, OfficeJet printers
-- Swift DZire: to capitalize on BE of Swift
-- Sony has ‘man’ suffix for its portable audio equipment viz. Walkman stereos & Deskman portable CD players
-- McDonald’s uses “Mc” as in McChicken, McAlooTikki
A relationship between a brand & multiple products can also be established with common symbols
Often desirable to have a logical ordering among brands in a product line to communicate how the different brands are related and simplify consumer decision making:
- relative ordering may be communicated through colors (e.g. American Express offers Green, Gold, Platinum cards), numbers (e.g., BMW 3-, 5-, 7- series) or any other means…
Principle of Commonality cont.
Adjustments to mktg. programWITH MULTIPLE LEVELS OF
BRANDING HIERARCHY, DIFFERENT LEVELS OF
AWARENESS & IMAGE MAY BE DESIRED AT EACH LEVEL:
Two potentially useful, marketing communication strategies to build brand equity are:
1. Corporate Brand2. Family Brand
Corporate Image CampaignsObjectives of these campaigns should be to:• Build awareness of company & nature of its business • Create favorable attitudes & perceptions of company
credibility (ICICI: Hum Hai Na)• Link beliefs that can be leveraged by product-specific
marketing (Nike: Just Do It)• Make a favorable impression on the financial
community (Indian IT ads boasting about being a $1 billion company)
• Motivate present employees & attract better recruits (Aditya Birla Group corporate ads)
• Influence public opinion on issues (Surf: Do Boond Pani)
These broader image campaigns may also be employed at the family brand level
Brand Line CampaignsSHOW CONSUMERS DIFFERENT USES OR BENEFITS
OF THE INDIVIDUAL BRANDS OFFERED BY FAMILY/ CORPORATE BRAND
(EG: Let’s go in an Alto; SX4: Men are Back; Hero Honda Pleasure: Why should boys have all the fun)
BRAND LINE ADS MAY BE PARTICULARLY USEFUL IN BUILDING BRAND AWARENESS, CLARIFYING BRAND
MEANING & SUGGESTING ADDITIONAL USAGE APPLICATIONS
(ICICI Bank Credit Cards, Amul Kool, etc)
Roles that brands play as part of portfolio Flankers or fighter brands Cash Cows: maintain their profitability with
little or no marketing efforts Low end entry level (traffic builders) or Hi-
end Prestige brands (add prestige & credibility to entire portfolio)