Marketing: Branding PDF

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What is a brand? Brand identity prism, Why branding? Brand Extensions; Ansoff Matrix; How do you build a strong brand? Brand Positioning. How do you build a Strong Brand? ...

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Lecture 8: Branding What is a brand? 1984- considered best advert of all time. For apple mackintosh- branded themselves as something different, innovative, new products.

Origins • • •

Trademarks Functional benefits Emotional benefits

- Trademarks Industrial revolution = marked/stamped crates and cases to distinguish themselves from competition. Evolved to have functional benefits eg. Nice refreshing beverage that revives/sustains. Evolved to be symbol of quality. - Coca Cola’s 1905 slogan : revives and sustains. - Coke’s 1979 slogan – beyond just functionality and the actual product – emotional benefits- gives a good feeling, amercian nostalgia- social. Formally a brand is a proprietary trademark of a specific product or service. If you have a brand you want to legally protect your brand and trademark it. and that's if you talk to lawyers about a brand they'll talk about it as a trademark. Patents & licenses/trade agreements But more than that… Conceptually/traditional marketing will consider it: • A “contract” from company to customers • A promise of specific benefits, quality, and valuation • A relationship But more than that… People have in the past talked about brands as a relationship or a contract. A promise of the company to deliver certain specific benefits to the customer. So some kind of brand relationship, or branded relationship. and so it's much more than just a trademark, it's a promise, it's consistency, it's benefits, it's, it's what you come to expect from a brand [Traditional definition] eg. You buy a coke, you expect the high quality that coke is supposed to deliver, safe, tasty etc. What is a brand? Now Bigger than that… The world is inter-connected now. People talk and interact with one another

A brand is whatever the customer perceives it to be. Hence a lot of market research is about understanding how the customer perceive your brand. The customer feedback helps to build the brand. Textbook definition. So products have deliberately designed value (by marketing managers) to enhance their offering so that it offers values that are meaningful to their customers- but it is customer perception, the images, meaning and value that customers give to the brand that is important. Added value = functional value but also emotional and symbolic qualities - caring, sexy, part of a group, Jaguar= is Indian brand, but people have perception that it is classic British, great British engineering etc. Hence their advertisements reflect this and cater to the customers’ perception eg. Using British actors to start in advertisements Aston Martin – great sports car. British, like James Bond TEXTBOOK= Branding is the process by which manufacturers and retailers help customers to differentiate between various offerings in the market- enables them to make associations between certain attributes or feelings and a particular brand. - Successful brands manage to achieve this distinction and create strong positive and lasting impressions through their communications and associated psychological feelings and emotions, not just through functionality of use. - Brand names provide information about content, taste, durability, quality, price and performance without requiring the buyer to undertake time consuming comparisons with similar offerings. Low customer involvement tend to be brands that are emotional or image based (KFC, the Colonel is a friendly face). High involvement (eg. Cars, pharmaceuticals)- involvement is high=- require rational information-based messages supported by image-based messages. - Brands are effectively products and services that add value- done deliberately by marketing managers to augment their offerings to the consumer. It is customer perception- the images that they form of these brands that are important- so both managers and customers are involved in the branding process. What is a brand image? • • •

The set of mental representations, both cognitive and affective, that a person or a group of persons holds toward a brand Cognitive= jaguar is a functional car, great engineering etc. Affective= Classic British heritage, sexy, sleek

What is brand identity? • • •

Brand identity represents the “true self” of the brand It is based on the brand’s vision, aim, nature, strategy (mission statement- last week) It is included in a document (i.e., the brand’s charter) which defines what must stay and what is free to change

Brand image vs. Identity

Brand identity = source/company focused | created by marketing managers - The company’s plan for the jaguar car, bring it into continental market, classic British car, transmit this message through its advertisement= endorsing of British villains. This creates a brand image. Brand image = receiver or target audience focused , decoded created by perceptions of the consumer But obviously this isn't one way street- brand identity- signals to brand image- often there’s other factors such as competition

Brand identity prism

How do you figure out what a brand identity is? Can use brand identity prism

Externalisation- external bits of the brand/product that people can see.

Internalisation- the inherent aspects of the brand, personality- human like characteristics- culture it portrays and self-image

Physique •

Physical features of a product/brand

Packaging, logo. Functional differentiators = caps, handles, product shapes (coke bottle)- don’t even need the specific logo to know what it is. Predominant colour, writing, design features This is very important for a brand.

Physique is important! Tropicana decided to change their packaging but their share sales dropped, social media exploded with customer complaints --> they couldn't’t recognize Tropicana anymore- no distinct orange/green font. Similarly CBBC font changing- not recognizable anymore. On January 8th 2009, Tropicana launched the new packaging for its best-selling product in North America – Tropicana Pure Premium, with sales revenues reaching more than 700 million dollars per year. A few days

later, consumers started criticizing the new design, especially on social networks. Two months later, sales dropped by 20%, and this spectacular decrease in sales represented a lost of 30 million dollars for Tropicana. On February 23rd 2009, Tropicana announced that it would return to its original packaging design, and within a few months, the old packaging was back for good on all supermarket shelves In total, this initiative cost Tropicana more than 50 million dollars.

Relationship • •

Between consumer and brand Exchange beyond the transaction

E.g. Lexus tried to give people VIP experience by rolling out red carpet when people have bought the product- so goes beyond just the transaction of signing the contract and paying.

Both hospitality are very one

brands in sector but different to another.

Refer to Harvard Business Review article “Build your brand as a relationship”

Reflection • •

In your mind- who you stereotypical consumer will be- the idealised target market Smallest subset of your target market

Stereotypical consumer that communications like to portray Coca cola = reflection= Young people | Reality = sells to everyone Redbull = Young, energetic, risk-seeking individual | Reality = energy drinks market, everyone really. Gamers that sit at home and don’t do any sports Roxy= surfers/sporty people- teenagers usually buy roxy and then grow out of it. Real market usually bigger or different to reflection

Personality Brands can trigger associations in the minds of consumers and this kind of BRAND ASSOCIATIONS enable customers to construe a psychological meaning associated with a particular brand. Eg, Customer will seek brands with a personality that will complement their self concept ie brands offer a means of self expression- ideal self, ought self, ideal self etc. The emotional and symbolic approach= provide consumers with additional reasons to engage with a brand beyond just the functional characteristics of the product- which are so easily copied by competitors. •

Human characteristics associated with brand • Values • Psychosocial meaning • A brand’s personality usually portrayed through people/Endorsement

Which brands are associated with who? We have certain connotations with celebrity endorsement eg, Adriana Lima and Victoria’s secret- hot, young, outgoing SO how do we describe brand personality?

Use Aaker’s work on brand personality to highlight the characteristics of a brand It can encompass five dimensions, not an exhaustive list, just a guide or measurement. Nespresso- what personality traits associated? Trustworthy= if its broken, someone will come fix it no worries. Up to date- nice and sleek designs

Customers assign a level of trust to the brands that they encounter so vital to ensure that perceived levels of trust not harmed- preferred brands signify trust and a deliverance of promise. Eg. In walking boots, the yellow logo symbolises good quality.

Culture •

Values that feed brand inspiration • Usually use source of origindoesn't’t have to be a geographical place but just how the brand started eg. Hermes.

Eg. What is British culture? French culture? Etc.

Hermes Paris- High quality harness, bridles, saddles for the carriage trade. Highlight that their origin in a lot of their advertisements (horse products). Now Hermes associated with expensive scarves/belts- but still highlight that they’re a luxury brand, good with leather, continental (French). Zipper on leather goods and clothing (exclusive rights)

1935 - Kelly bag (after grace Kelly) and scarves in 1937

Self-image of what a brand is? • •

Mirror How the consumer wants to be seen

Brand = means of self-expression Like a mirror of erised (desire)- what the consumer wants to be, strive, should Ideal self (who they strive to be) Desired self (who they want to be) Ought self (who they should be) Eg. Pharrell, hip and cool with adidas, Tommy Hilfiger, Gigi Hadid to portray idealised image of what consumers desire to be

WILL COME UP IN EXAM!!

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Use this model to Assess strengths & weaknesses of their brand using 6 aspects of the prism

“Strong brands are capable of weaving all aspects into an effective in order to create a concise, clear, and appealing brand identity” - Jean-Noel Kapferer

Why brands? Brands make the buying and selling process easier, more efficient and faster for both the customer and the organisation. Communicative role for the consumer •

•

Simplify choice/people cant cope with too much info – Quality- known brands give you indication of quality – ¯Risks- so lowers financial risk, or social risk- so improves the quality of the shopping experience. eg. Does what you wear suit who you want to be? Help people to gauge the level of product quality. Eg. Dior couture. – Psychological reassurance (¯Search costs)- don’t need to search everywhere- know what is good- especially products bought on an occasional basis. – Informative (Country of origin, personality, etc.)- eg. Hermes tells you its French, its luxury etc, Social role – Brand symbolism – Communication

Risks – Functional risk (will pdt work?) | social risk (can I carry off a Versace dress?) | financial risk (can I afford this?) - Basically helps customers to identify the products and services that they prefer to use and avoid the brands that they dislike because of previous use or any other associations. - Branding help reduce risks such as financial risks (can I afford this), social risks (what will other people think?), functional risks (will it work). So buyer will purchase with ease and get assurance of safety and purchase security. - When consumers know little about a market (eg. Technology)- will make judgments based on branding. To reduce time and risks attached. - Most importantly, branding is to help consumers develop relationships based on trust. Strong brands normally well trusted – allows buyer to buy with confidence. Many brands are then deliberately imbued with human characteristics (brand personalities) eg. Caring, fun, friendly- Nandos?

Brand communicate safety and purchase security

Eg. Some people want to shout to the world that they’re rich so they’ll get big, flashy expensive products that signify wealth. But there's also people who employ: conspicuous consumption- quietly rich. Luxury brands charge more for quieter (less brand prominence) products Old rich (low need for status) à Quieter products Nouveau riche (high need for status) à Louder products Bright eg. Gucci glasses with big logos. Poor but high need for status à Loud counterfeits Usually these quieter products are acutally more expensive. So need to be in the know to realize that this is a luxury brand. People are all rich anyways so no need for status eg. Hermes, on their products you can’t really tell who it is by. With the kelly bag, unless you know it is a kelly bag, it is not obvious that the bag is by Hermes. Han et al. (2010) Signaling status with luxury good : the role of brand prominence article Mating guarding behavior – While men use luxury goods to attract mates. Threatened females seek and displayed lavish products to signal their partner’s devotion (Wang & Griskevicius, 2014)

People see brands as a source of long-term growtth/income. Eg. Even if there was not coke, you’d still know what the brand was but a product without a brand, people are less likely to buy. Source of value - Potential for future profits, long term cash flow 1988, Philip Morris buys Kraft 13 billion! $106 a share, $9.50 higher than what Kraft shares closed. Brand included in valuation! (http://www.nytimes.com/1988/10/31/business/kraft-being-sold-to-philip-morris-for-13.1-billion.html? pagewanted=all) - Premium pricing = Brand conscious consumers are less price sensitive

Companies like brands because: •

Source of value and money- enables buyers to recognise the brand quickly and to make fast, unhindered purchase decisions.

Source of value - Potential for future profits, long term cash flow 1988, Philip Morris buys Kraft 13 billion! $106 a share, $9.50 higher than what Kraft shares closed. Brand included in valuation! As in people paying just to be associated with the a well known brand. -

Can sell at premium prices = Brand conscious consumers are. Stella artois, Loreal charge about 20% more than generic brands. Allows reinvestment of branding to remain competitive.

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Differentiation- eg. How different is a coke from a sainsbury’s basic cola? (in terms of taste? There isnt really a difference, but in terms of branding? Huge difference! We’re willing to pay a premium for a brand) Customer loyalty (only drink real coke and not cola- brand used to be indicator of quality and this has just remained- people buy the same from the same brand out of trust and habit. Marketing communications- guides how you promote and advertise, eg. With innocent smoothiewanna be bright and healthy- promote an active lifestyle. Legal protection- brands can be protected/patented Create customer loyalty so customer will seek the brand out and are more prepared to accept Brand Extension and Cross-promotion is a form of marketing promotion where customers of one product or service are targeted with promotion of a related product.

• • • •

Brand Extensions Attractiveness of brand extension is the time and money does not need to build awareness or brand values. Give reason for consumer to try it. •

“Use of established brand names to enter new product categories or classes”

Eg, Virgin was a record company and has got into everything, planes, airlines, internet wifi Why = you can extend your brand to create more avenues to make $$$ Eg. Radox spa, chocolate Weetabix as extension to normal Weetabix- vertical extension Coca Cola making nail varnish- horizontal extension. Vertical/line extension • •

Extend to same category But different price/quality to reach new market segment

Example of vertical extension: coke extended to coke zero and coke diet to extend to further segments of the market eg. The health conscious males and females. Even coke vanilla, lime and lemonade to cater for different tastes.

Horizontal/Category extension •

Different category

Eg. Coke buying innocent- completely different market (healthy) Starbucks came up with own coffee machines/coffee pots

Ansoff Matrix

So how to extend your brand? Can go into this matrix again. Just change from product on the X-axis to product category. Vertical extension = present product category and brand name= different flavors of coke. New product but existing brand name= horizontal extension= snickers going into ice cream. Product is there but extended their brand- eg. Tesco came up with another brand, tesco mobile- vertical . New brand/new product category= fujifilm and astalift skin care- horizontal Market Penetration = Developing existing markets Market Development – Move into new market where they don’t really have previous involvement -

Create multibrand using co-branding - Tesco entering fixed line communications with co brand cable and wirelss Creating own or sub-brands = toyota acquiring lexus to reach the luxury market

Advantages • Facilitate new product acceptance- doesn’t really need to promote- trust for brand already there • Improve brand image Sony vaio coming up with great laptops just improves their credibility as a brand • ¯Perceived risks- no need to come up with new trials/distribution channel • Chances of distribution & trail • Efficiency of promotional expenditure- don’t need to spend as much on advertising the same values • ¯Costs of developing new brand Sony's re-entry into the global computer market, under the new Vaio brand, began in 1996 with the PCV series of desktops • • •

Costs of introductory & follow up marketing- cheap Packing & labeling efficiencies- no need to come up with new packaging/logo so no cost to trial a logo out. Allow for consumer variety seeking- people like variety

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Increase market coverage- get more of the market.

Can see this happen with apple. Apple started off with computers- then started going into other electronic products eg. Phones, ipods and with each new product, prices went up so sweeet for them.

Disadvantages • • •

Confuse consumers eg. Mc Donald's making pizza, also virgin- don't know what its main focus is Cannibalization- Mc Donald's making pizza- eating into own original market of fast food/savoury food Hurt parent brand

Virgin = started as record shop- now loads of avenues

How do you build a strong brand? Brand Positioning

What makes a strong brand? Great positioning From Lecture 4 Apple computers offers… The best personal computing experience to students, educators , creative professionals, and consumers around the world through its innovative hardware, software, and Internet offerings IBM…for businesses who need computers, IBM is the company you can trust for all your needs. How do you build a strong brand? Great positioning! ^^ these are positioning statements. Different positioning. One company is DIFFERENT from the other Target Segment = creative people! Clear segment! Though not limited to, everyone has an apple nowadays. Point of Difference = innovative Frame of reference = Who are our competitors who are comparing ourselves to. Target Segment = creative people! Clear segment! Though not limited to, everyone has an apple nowadays. The audience Point of Difference = what differentiates us? Frame of reference = Who are our competitors who are comparing ourselves to- also in what kinda field the company ...