Faculty of Al-Alsun and Mass Com.
Special Topics in Marketing
Communication
IMC 345
Handout
IMC 345 – Branding and Brand management – Fall 2023
Index
Overall aim of course…………………………………………………..…..….3
Course Assessment criteria………………………………………….………5
Chapter I
Brands and Rebranding……………………………………..……..…………6
• What is a brand……………………………………..…………....…..…..9
• What is branding……………………………………..….…….…..……14
Rebranding……………………………………………………………….………..19
• Types of rebranding…………………………………….……..…..…..20
Chapter 2
Brand planning…………………………………………………………….……26
Brand Equity…………………………………………………………………..…28
Keller’s brand equity model……………………………………….……..32
o Brand Salience…………………………………………….…..33
o Brand Meaning………………………………………....…….37
o Brand responses……………………………………..……….39
o Brand relationships…………………………………..……..40
Strong vs Weal brands……………………………………………..……..43
Chapter 3
Kotler’s brand conceptual model…………………………..……..….48
o Brand Purpose …………………………………………..…….49
o Brand Positioning………………………………………...…..66
o Brand Differentiation………………………………..………84
o Brand Identity…………………………………………..………88
o Brand Trust……………………………………………………..105
o Brand Beneficence……………………………..…………..112
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Index Cont’d
Chapter 4
Building Brand Portfolio……………………………………..…………..…119
• Brand Portfolio Models…………………………..………..…..…... 124
Chapter 5
Brand Architecture…………………………………………………….…..… 133
Brand Development…………………………………………………..………138
o Product line extension……………………….……………..140
o Multi Brand………………………………………………..…….143
o Brand extension……………………………………..…………147
o New brand……………………………………………...………..151
Chapter 6
Market Expansion…………………………..……………………………..….153
The Ansoff Matrix……………………………………………………………..154
Chapter 7
Analyzing the competition……………………..………………………….161
The 5 Forces of Porter……………………………………………………..…162
Chapter 8
Global Marketing Strategies……………………………………..……….178
Expanding Internationally model………………………………..……..181
Chapter 9
Monitoring Brand Performance…………………………………………194
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Overall aim of
course
This course aims to offer an
understanding on the
overall brand building and
management process. It will
be both academic and
practical, it will depend on
offering the basic
knowledge about brands’
architecture and applying
on real cases through
classwork and assignments.
This goes along with
understanding differences
and definitions between
diversified brand structures
and the rationale behind
the decisions in brand
management and hierarchy.
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Branding and Brand
Management
5
IMC 345 – Branding and Brand management – Fall 2023
Chapter 1
Brands and Branding
Rebranding
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BRANDS AND
REBRANDING
7
To illustrate the definition of a product and the role
it occupies in defining branding, we will use the
example of water:
Water is a free resource that every human being
needs to live and survive. Yet it became a product
the day humans and companies started to
commercialize it, for example by selling mineral
water in glass and plastic bottles.
But water always looks the same, isn’t it? It is
liquid and transparent. So, how can different
companies sell the same product but still
convince people to purchase their bottled
water instead of the one from the
competition?
The answer is::
by creating a brand.
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What is a brand?
1. A person
A celebrity or a TV Anchor or a president or even a
business man. anyone who wants to create a certain image
2. An
organization
NGO’s and non-profit organizations need branding for their
activities and for fund-raising.
3. A place
or a country
Countries brand themselves to encourage tourism or to
position themselves in the mind of their target as expert in
specific areas… like technology advanced or a business hub.
4. Services
Shops, coffeeshops , restaurants, banks etc…. all services
need to have a recognizable brand with a favorable image
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What is a brand?
5. A product
All possible types of products
Brand Definition
“A brand is a name, term, design, symbol, or any other
feature that identifies one seller’s good or service as
distinct from those of other sellers” (American
Marketing Association).
You can consider a brand as the idea or image people have in
mind when thinking about specific products, services and
activities of a company, both in a practical (e.g. “the shoe is
light-weight”) and emotional way (e.g. “the shoe makes me feel
powerful”). It is therefore not just the physical features that
create a brand but also the feelings that consumers develop
towards the company or its product. This combination of
physical and emotional cues is triggered when exposed to the
name, the logo, the visual identity, or even the message
communicated
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Let’s
exercise
Ask yourself about a
trendy /modern
furniture brand?
Answer / s:
Ask yourself about a
coffeshop with a
comfortable working place
Answer / s:
• A brand is no longer what we tell the consumer it is—it is what
consumers tell each other it is.”
• For instance, there are many furniture stores and brands out
there, but one that stands apart in most people’s minds is IKEA.
When people think of stylish furniture at an affordable price
point, the Swedish company is the most immediate association.
• The same goes for Starbucks coffee shop, it is the first brand that
comes to mind which combines coffee and working comfortably.
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What is a brand?
Let’s illustrate this again with our water example. The product sold is water, but
in order to convince people to purchase a particular water, companies
developed different water brands, such as Evian, Hayat, Baraka or Dasani. And
each one of these brands provides a different meaning to the product water:
– Evian makes you feel young
– Nestle is pure and healthy
– Dasani Re-hydrate…. and so on…
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From Brand to
Branding
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What is branding?
• Although it’s really your customers who decide what your brand is, there are
certainly actions you can take as a business owner to put yourself in the
driver’s seat.
• All the steps that you take to build awareness and reputation around your
company and its product or services live in the realm of branding. Your
branding efforts may not always fully translate into your customers’ minds,
but the more deliberate and cohesive they are, the higher the chance of
success.
• Before making any branding decisions, first consider this:
• what is the perception you want to impress on your customers?
What’s your goal brand? Be authentic and really dig into the
core why of your company. This high-level strategy should help to
guide your branding decisions.
Definition
the active process of shaping the
perceptions that consumers have
about your company / product /
service.
The process involves:
• positioning your company or product in the market (carving out your own
place and identifying your unique personality),
• devising brand strategy (how you will reach your goals),
• creating your name (your verbal identity),
• designing corporate identity or product identity (your visual identity),
• writing brand messaging (verbal and written tone),
• and setting brand standards (how you keep your brand consistent and
strong).
In a nutshell… it is creating what we would call a brand portfolio
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examples
• In our example of branding water, packaging design and advertising are
perhaps the most powerful tools used by marketers:
• – Packaging design is the silent salesman that will grab busy consumers’
attention in-store. It informs consumers about the product’s properties
and visually differentiates the brand from the competition on-shelf. A
successful example is
• Fiji Water, which managed to create a beautiful bottle design that perfectly
reflects the brand’s values: purity is reflected through transparency effects
and nature is perceived through the image of tropical flower and leaves in
the background.
• Another example in Flo water in Egypt, which perfectly reflects quality and
purity again with its transparent elegant bottle.
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Why is branding
important?
1.
Brands can reduce the risk in product decision for consumers, so buying well known
brands obviously reduces risks:
Functional risks: the product does not perform up to expectations
Physical risk: the product poses a threat on the physical well being of the users or
others
Financial risk: the product is not worth the price paid
Social risk: the product results in embarrassment from others
Psychological risk: the product affects the mental well being of the user
Time risk: the failure of the product results in an opportunity cost of finding another
satisfactory product
2.
Helps you stand out from the competition. It doesn’t matter what kind of company you
have, what industry you’re in, or what type of customer you’re after—if you’re in
business, you’ve got some serious competition. Branding helps you establish the ways
in which you’re different, special, and unique. And it shows your customers why they
should work with you instead of your competitors.
3.
Builds brand recognition. If you want to build a successful brand, you need to be
recognizable. The right branding (including designing an impactful logo, website,
and other brand assets) helps you carve out a distinct style, and it increases
your brand recognition in the market.
4.
Sparks a connection with your audience and turns that audience into loyal
customers. The most successful businesses are the ones that foster an emotional
connection with their audience. That emotional connection is what transforms a
prospect into a customer and a customer into a brand enthusiast. And how do you
create and build that connection? Branding. Different branding strategies (like
packing an emotional punch with your brand voice or leveraging color psychology
when designing your logo) can help you connect with your audience on a deeper
level and create a sense of loyalty to your brand.
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Why is branding
important?
5. Brands have financial value because they have created assets in the minds and hearts of
customers, distributors, prescribers, opinion leaders.
These assets are brand awareness, beliefs of exclusivity and superiority of some valued
benefit, and emotional bonding. This is what is expressed in the now classic definition of a
brand: ‘a brand is a set of mental associations, held by the consumer, which add to the
perceived value of a product or service’ (Keller, 1998) These associations should be unique
(exclusivity), strong (saliency) and positive (desirable).
6. Branding Generates New Customers
A good brand will have no trouble drumming up referral business. Strong branding
generally means there is a positive impression of the company amongst consumers,
and they are likely to do business with you because of the familiarity and assumed
dependability of using a name they can trust. Once a brand has been well-established,
word of mouth will be the company’s best and most effective advertising technique.
7. Branding tells your story in an instant
Imagine that an audience is being introduced to your brand for the first time. Wellexecuted branding has a lot to say.
Who are you as a brand, exactly? If you don’t know, then neither will your audience.
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Let’s
exercise
• State 4 of the reasons why branding is important
Answer:
1. ……………………..
2. ……………………..
3. ……………………..
4. ……………………..
• State 2 actions that are considered as part of the branding process
Answer:
1. ……………………..
2. ……………………..
Right or Wrong?
• “Broadly, a product is anything with a name that can be offered to a
market to satisfy a want or need,
• You can consider a brand as the idea or image people have in mind
when thinking about specific products
• A brand could be a person
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REBRANDING
19
Rebranding
Rebranding is the creation of a new look and feel for an
established product or company.”
“The usual goal of rebranding is to influence a customer’s
perception about a product or service or the company overall.”
Rebranding could be the name and visual identity or just visual
identity
Definition
Rebranding is the process of changing the corporate image of
an organisation. It is a market strategy of giving a new name,
symbol, or change in design for an already-established brand.
The idea behind rebranding is to create a different identity for
a brand, from its competitors, in the market.
Types of Rebranding
There are two main types of rebranding, Proactive and Reactive
Proactive
• Proactive rebranding occurs when company executives are thinking ahead or see a growth
opportunity.. a company recognizes that there is an opportunity to grow, innovate, tap into
new businesses or customers, and to reconnect with its users.
Let’s understand with the help of an example – Titan Industries rebranded itself in 2013 and
changed the logo as well as the name to Titan Company. The new logo highlighted the
company’s commitment to "create value, innovate, and maintain highest global standards".
S Ravi Kant, CEO of the company's eyewear division says the word 'Industries' in the
company's name was limiting its scope in the consumer's mind as it was perceived to be
only a manufacturing company - a long way from the lifestyle-oriented image it wants to
carry forward.
"The word 'Company' is very contemporary and very modern, as opposed to 'Industries'
that refers to manufacturing," Kant explains.
Reactive
• Reactive is when the company responds, i.e., ‘reacts’ to something. Perhaps it responds to a
series of events that have altered the company’s or a product’s image Reactive rebranding is
done in a situation when the existing brand has be discontinued or changed. Possible
reasons for such a action could be mergers & acquisitions, legal issues, negative publicity
such as fraud, aiming to beat the competition, or create your own niche.
Let’s understand with the help of an example., Mobinil becoming Orange (acquisition)
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Reasons for Proactive rebranding
1. Predicted Growth:
• When a company is preparing for expected growth, particularly international growth,
it might rebrand products and services into a consolidated brand. This is often done
for consistency and to save money over time. This type of rebranding is also done
when a company simply needs to create a greater sense of brand unity across its
business.
2. New Line of Business or Market:
• You’ve introduced some prominent new products or services to your portfolio which
are performing great. You are getting new customers, new interest, and are
considering changing your branding to reflect your new offering. For example, if in the
past your main business was legal advice to mid-sized companies and now half of
your business comes from offering financing and strategic consulting to start-ups,
maybe your logo should no longer be this:, It might be misleading to your new
customer segment.
3. New Audience:
• When a company wants to appeal to a new audience, a rebranding might be
necessary. Keep in mind, the rebranding might not require an actual name or logo
change.. Your branding, however, is not performing well among your new target
people.
• Let’s look at Old Spice. They implemented this strategy after discovering that 60% of
men’s body washes were purchased by women. The famous brand decided to reach
female audiences with their new commercial. Their new campaign received 105
million views on YouTube, drove traffic to the brand’s site, and earned 1.2 billion
impressions.
4. Relevancy:
• When a company realizes its brand is losing relevancy in consumers’ minds, it might
be time to rebrand. The Yellow Pages rebranding is a perfect example. With the use of
printed Yellow Pages directories declining, Yellow Pages rebranded to YP and began to
focus more attention on the digital space making it significantly more relevant.
5. You look like everybody else
• You notice that over time all your competition has developed the same look and feel,
a similar font, the same house style, and almost the exact same brand colors as well.
Perhaps rebranding would be a nice way to differentiate yourself from the
competition? Whether this is a good idea depends on your position in the market. Are
you a market leader, a long-standing, recognizable brand? Or are you an undertaker
with a fresh new take on the market?
• Rebranding will always impact your existing audience. A different look or name will be
met with some resistance and your brand recognition will drop momentarily. But if
you are a challenger-brand and want your new branding to represent the innovative
approach you bring to the table, rebranding might do more good than sticking to a
stuffy look.
6. Your brand is outdated
• If you’ve had the same branding for 20 years
maybe it’s time for a refresh.
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Reasons for Reactive rebranding
1. Merger or Acquisition:
• When companies merge or acquire other companies (and even when they break
apart), rebrandings are often required. That’s how we’ve gotten brand names like
Pricewaterhouse Coopers and Bank of New York Mellon. When AT&T broke up into
three separate companies in the late 1990s, Lucent Technologies was born. These
types of rebrandings are very common and often go through multiple iterations.
2. Legal Issues:
• There are a number of different legal issues that could cause a company to rebrand.
Trademarks are often at the root of these rebranding examples. That’s why it’s so
important to conduct an exhaustive trademark search and obtain the trademark
rights to your brand name before you launch it.
3. Competitive Influences:
• Sometimes a company’s competitors’ activities can be the catalyst to a rebranding.
When a competitor renders your brand useless or dated, a rebranding could help
you regain a foothold in your market and give you the facelift you need to
effectively strike back.
4. Negative Publicity:
• Remember a brand called “LANG”? A detergent which carried the bad perception
of being a very low performing product in the worlds of detergents. In 1998, P&G
bought it and renamed it. the brand was reborn as ”BONUX”, representing a great
example of effective rebranding in response to negative publicity.
• Couple of years ago, Kia said
that the logo was intended to
convey a fresh start and a
change of direction for the
company. "The rhythmical,
unbroken line of the logo
conveys Kia's commitment to
bringing moments of
inspiration, while its
symmetry demonstrates
confidence," it said in a press
release.
Question: is this Proactive or Reactive
Rebranding?
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Rebranding Examples
• Sometimes even the greatest brands can be greater.
Rebranding happens in many ways, and a common
approach is a logo refresh.
• In 2013, Wendy’s did just that. The colors and imagery still
reflect the classic fast food chain that you know and love,
but their new logo feels modern and friendlier, too.
Microsoft and Burger King have also made comparable
branding improvements over the years by evolving their
logos. Rebranding is incredibly important to the long-term
sustainability of a mega-brand. Having a strong core brand
identity can help ensure the success of a rebranding effort.
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Tupperware
• Tupperware often conjures images of ‘70s moms. So, instead
of running from it, the brand acknowledges that image as a
significant part of their legacy—and their greater mission.
They aren’t just about the containers; they’re about
empowering the women who sell their products around the
world. Thus, “confidence becomes you” became their rebrand
rallying cry.
• Their bold visual makeover introduced vibrant colors, peoplefocused imagery, and a cleaner aesthetic to bring the brand
into the modern age.
Before
After
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Let’s
exercise
Molto brand was introduced in the market in 1997,
since then a lot of other similar products entered the
market and competition is getting stronger.
• Do you think Molto needs re-branding?
• If no why?
• And if yes would you consider it reactive or
proactive?
• If Nestle company decided to buy Molto brand
from Edita, do you believe they will need to rebrand it? Justify your answer.
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Chapter 2
Brand Planning
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Brand planning
Attention economy: companies are targeting our attention to make
money. They’re placing ads they know might interest us and try to
grab as much of our focus as possible
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Brand Equity
Question: which one of these two identical Tshirts will you pay more to buy ?
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Brand Equity
• one of the most widely accepted definitions indicates that brand equity is
“the added value with which a given brand endows a product”
• First, the financial perspective explores the financial value brand equity
generates for an organisation (firm- based brand equity).
• Second, the consumer perspective, drawing from cognitive psychology,
focuses on the added value created by the different ways consumers
perceive the value of the brand in their life, and how their perceptions
influence their behaviour (customer- based brand equity).
• Third, the economics perspective examines the added value created by the
extra utility (other products with same brand name) a brand gives to a
product or service.
• Fourth, the employee perspective is about the “differential effect that
brand knowledge has on employee’s response to their work environment”
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Brand Equity
it is important to show how the consumer and financial approaches are
connected, and to use clear terms with limited boundaries so that they can
be measured.
• Brand assets. These are the sources of influence of the brand
(awareness/saliency, image, type of relationship with consumers), and
patents.
• Brand strength at a specific point in time as a result of these assets within
a specific market and competitive environment. They are the ‘brand equity
outcomes’ if one restricts the use of the phrase ‘brand equity’ to brand
assets alone. Brand strength is captured by behavioural competitive
indicators: market share, market leadership, loyalty rates and price
premium (if one follows a price premium strategy).
• Brand value is the ability of brands to deliver profits. A brand has no
financial value unless it can deliver profits. To say that lack of profit is not a
brand problem but a business problem is to separate the brand from the
business, an intellectual temptation. Certainly brands can be analysed from
the standpoint of sociology, psychology, philosophy and so on, but
historically they were created for business purposes and are managed with
a view to producing profit.
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Building Equity
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Building brand Equity
Keller’s Brand Equity Model
What Is Keller's Brand
Equity Model?
• Keller's Brand Equity Model (also known as the
Customer-Based Brand Equity (CBBE) Model) was
first developed by marketing professor, Kevin Lane
Keller.
• The concept behind the Brand Equity Model is
simple: in order to build a strong brand, you must
shape how customers think and feel about your
product. You have to build the right type of
experiences around your brand, so that customers
have specific, positive thoughts, feelings, beliefs,
opinions, and perceptions about it.
• When you have strong brand equity, your
customers will buy more from you, they'll
recommend you to other people, they're more
loyal, and you're less likely to lose them to
competitors.
In order to develop strong brand equity the organization must
follow four important stages:
1. Make the consumer aware of the brand and associate the brand with a
specific category or consumer need (brand identity)
2. Create brand meaning in consumers’ minds by linking certain properties
of the brand with a range of tangible and intangible brand associations
(brand meaning)
3. Generate rational and emotional consumer responses to this brand
identity and meaning (brand responses)
4. Transform these consumer responses to intense and long term loyalty
relationships between the consumer and the brand (brand
relationships)
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Building brand Equity
Keller’s Brand Equity Model
The four steps of the pyramid represent four fundamental questions that your
customers will ask – often subconsciously – about your brand.
These four steps also contain six building blocks that must be in place for you to
reach the top of the pyramid, and to develop a successful brand.
1. Brand Salience
• Components of Brand saliency
•
•
•
•
Awareness
Recall
Recognition
Branding objectives: awareness depth
and breadth
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Brand Salience - awareness
• Brand salience (brand identity) The first level of the CBBE pyramid model
involves brand salience, which is consumers’ awareness of the brand. In
this stage, the firm must make consumers aware of the brand, and let them
know it is part of a specific product or service category and/ or is connected
with a specific consumer need. This will enable the organization to create a
very strong brand identity and answer the consumer’s question of ‘who are
you?’
• Of course, products do not only satisfy consumers’ physical needs, they
can also satisfy their emotional and symbolic needs. For example, a firm
seeking to launch a new brand of clothing for skaters or BMX bikers will
want to make those consumers aware of the brand in the first place. It will
also seek to demonstrate to them that the new brand is one which can
satisfy not only their functional needs but also their symbolic needs for
communicating a skater’s or biker’s identity and belonging to this specific
social group.
• Integrated marketing communications activities can help the organization
generate brand awareness.
Brand Salience – brand recall
• Brand recall “relates to consumers’ ability to recall the brand when given
the product category, the needs fulfilled by the category, or some other
type of probe as a cue…
• For instance, when launching a new soft drink, it is essential that the
company makes consumers aware of the new product and clearly
communicates, through suitable marketing communications activities, that
the product is a soft drink and will satisfy their thirst.
Brand Salience – brand recognition
• Brand recognition is about the “consumers’ ability to confirm prior
exposure to the brand when given the brand as a cue…[It] requires that
consumers correctly discriminate the brand as having been seen or heard
previously”
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Brand Salience – branding objectives
Branding objective: Depth and breadth of brand awareness
• Depth of brand awareness is about “how likely it is for a
brand element to come to mind and the ease with which it
does so” This means that depth of brand awareness
determines how easily the consumer can recall or recognise
the brand element.
• Breadth of brand awareness is about the range of purchase
and consumption situations in which the brand element
will come to the consumer’s mind.
• A salient brand is one that has both depth and breadth of
awareness, i.e. it is a brand that consumers not only can easily
think of, but also think of in a range of different situations. For
instance, CocaCola is a soft drink consumers might be able to
think of easily (depth), but also it is a product which consumers
might think of in a variety of situations (breadth), such as when
they want a drink to cool down, a drink to have with their meal,
when watching TV, or when socialising with friends.
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Brand Equity
1. Brand Salience - Example
Consumer based brand
equity
Saliency
Modern retail furniture
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2. Brand meaning
Brand performance and brand imagery associations (brand meaning)
• The second level of the Keller’s pyramid model involves brand
performance associations and brand imagery associations
• In this stage, the organisation aims to create brand meaning by
linking certain brand properties with a range of tangible and
intangible brand associations on brand performance in
consumers’ minds and seeks to answer the consumer’s question of
‘what are you?’
• Creating a strong brand meaning means generating a positive
brand image in consumers’ minds
• Brand image is the “perceptions about a brand as reflected by the
brand associations held in consumer memory”
Lancôme brand imagery
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2. Brand meaning
Consumer based brand
equity
Saliency
Modern retail furniture
Imagery
Trendy, aspirational, modern home, neat,
friendly, innovative, comfortable, family
Performance
Furniture leader, Low prices, Functional
and diverse designs, space saver, DYI,
home solutions
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3. Brand Responses
• The companies must cater for the consumer’s response. Keller segregates these responses
into consumer’s judgments and consumer’s feelings.
• Consumer Judgments − They are consumer’s personal opinions regarding the brand and
how he has put imagery-related and performance-related associations together. There are
four types of judgments crucial for creating a strong brand −
• Quality, Credibility, Consideration, Superiority
• Consumer Feelings − They are consumer’s emotional reactions to the brand. They can be
mild, intense, positive, negative, driven from heart or head. There are six important feelings
crucial in brand building −
• Warmth, Fun, Excitement, Security, Social approval, Self-respect
Consumer based brand
equity
Saliency
Modern retail furniture
Imagery
Trendy, aspirational, modern home, neat,
friendly, innovative, comfortable, family
Performance
Furniture leader, Low prices, Functional
and diverse designs, space saver, DYI,
home solutions
Feelings
Welcoming layout, IKEA effect (DYI = self
respect) Socially accepted, familiar
environment (security)
Judgement
“Good deal”, low quality, not very
durable, good customer service
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4. Brand Relationships
• It is the level of personal identification the consumer has with the
brand. It is also called brand resonance, when a consumer has a
deep psychological bonding with the brand.
• Brand resonance is the most difficult and highly desirable level to
achieve. Keller categorizes this into four types −
• Behavioral Loyalty − Consumers may purchase a brand repeatedly or in high volume.
• Attitudinal Attachment − Some consumers may buy a brand because it is their favorite
possession or out of some pleasure in owning it.
• Sense of Community − Being identified with a brand community develops kinship in
the consumer’s mind towards representatives, employees, or other people associated
with the brand.
• Active Engagement − Consumers invests time, money, energy, or other resources and
participates actively in brand chat rooms, blogs, etc., beyond mere consumption of
brand. Thus, the consumers strengthen the brand.
Consumer based brand
equity
Saliency
Modern retail furniture
Imagery
Trendy, aspirational, modern home, neat, friendly,
innovative, comfortable, family
Performance
Furniture leader, Low prices, Functional and diverse
designs, space saver, DYI, home solutions
Feelings
Welcoming layout, IKEA effect (DYI = self respect) Socially
accepted, familiar environment (security)
Judgement
“Good deal”, low quality, not very durable, good customer
service
Resonance
Low attachment, price and distance sensitive, strong
engagement.
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Let’s
exercise
• Explain the depth and breadth of IKEA brand
• The 4 steps of the Equity pyramid are: (from bottom to
top)
1.
2.
3.
4.
…........
………
………..
……………
• The 3 main components of brand equity are:
1.
2.
3.
…………….
…………….
…………….
The following statements are right or wrong?
• Market shares are part of any brand’s assets
• A salient brand should have either depth or breadth
• A brand which can have premium pricing strategy is
considered to be a strong brand
• Brand strength comes as a result of brand value
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Brand Equity to Dollar value
2021
2022
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STRONG VS. WEAK
BRANDS
43
Branding – strong vs. weak brands
• Branding has both conscious and sub-conscious effects on
the consumers, and is very perception oriented. At the very
heart of the matter,
• Strong brands make clear promises that are kept over time.
Their positioning statement is crisp and clear with no
ambiguities;
• Weak brands seem to make vague promises that do change
over time.
• Strong thoughts and feelings are usually associated with
these brands as the customers are usually very loyal to the
brand. It can be said that these brands are dependable and
deliver consistently.
• Weak brands have low emotional commitment, have
‘spotty’ reputations and create doubt. In general, weak
brands rely on pricing and short term promotional
incentives.
• Neuroscientists have discovered that our emotions have a lot
more to do with how we make decisions than was previously
thought. It was found that clinical patients who lost the
ability to emote also had difficulty making choices. They knew
the facts, but couldn’t weigh them. It was also found that
emotions promote learning through releasing chemicals that
build connections in our brains, called synapses.
• Furthermore, once we establish those connections, they
regularly bypass the rational part of our brain, like when we
jump out of the way of a moving car and only later realize what
happened. So when we talk about brand associations, we are
really referring to synapses that have been established in
consumers brains. Strong brands have built up strong
synapses that relate to a variety of positive things, while
weak brands have weak synapses that conjure up little.
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Branding – strong vs. weak brands
• There are two systems that determine our purchase
decisions and behavior. Daniel Kahneman, a pioneer
in the field of behavioral economics, has come to this
conclusion in his work. In his book, Thinking Fast and
Slow, he describes two systems that lead us to action.
• System 1 consists of perception and intuition, it is also
known as autopilot and is implicit; it involves highly
skilled mental activities and it never sleeps, it is fast,
processes all information in parallel and is effortless,
associative and slow-learning; it is highly emotional.
• System 2 is slower and enables us to make reflective,
deliberate decisions; it is highly rational and weighs
facts, makes difficult calculations and takes more time
and effort; it is referred to as the pilot and is explicit.
• In his book : The Science Behind Why We
Buy he explains this model in terms of consumer
decision making. In time, consumers gain
experience by using products that they have
bought.
• Strong brands activate System 1. Weak brands,
on the other hand, activate System 2, which
means customers have to “think” about the
purchase decision.
• We only engage our second system when the
first one falls short. Research shows that
consumers who receive a discount enjoy a
product less than those who are exposed to
brand marketing. We will pay more to avoid a
risk than to have a chance to gain an identical
amount.
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Branding – strong vs. weak brands
When the consumer Internet first emerged,
many thought it would make purchase decisions
more rational. Shopping in a more information
rich environment would allow consumers to
research purchases and compare products
effectively. However, e-commerce has also
flattened the path to purchase, favoring the fast
System 1 over the slow and lazy System 2.
Consumers are more likely to rely on brand
associations built up before they intended to
make a purchase than on information provided at
the point of sale.
We said that the fundamental objective of branding is
differentiation … why?
• To establish an identity for the product or a group of products.
• To protect the product or service legally for its unique features.
• To acquire place for the product in consumers’ minds for high and
consistent quality.
• To persuade the consumer to buy the product by promising to
serve their needs in a unique way.
• To create and send the message of strong reliable business among
consumers.
This is what leads us to develop what we call
“Brand concept”
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Chapter 3
Kotler’s conceptual model
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Kotler’s Brand Conceptual Model
Brand
Purpose
Brand
Positioning
Brand
Differentiation
Brand Identity
Brand Trust
Brand
Beneficence
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KOTLER’S BRAND
CONCEPTUAL MODEL
Brand Purpose
49
Kotler’s Brand Conceptual Model
Brand purpose
• Walt Disney started his
company in 1923 to “bring
happiness to millions.”
Robert Wood Johnson started
Johnson & Johnson in 1886 “to
alleviate pain and disease.”
These companies are still
true to their purpose today.
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Kotler’s Brand Conceptual Model
Brand purpose
• Lego, the world’s largest toy
company, doesn’t just sell toys; it
strives for “the development of
children’s creativity through play
and learning.” To fulfill that promise,
it designs compelling sets of blocks
that can be assembled in myriad
ways. Just as critically, it fosters
online and in-person communities
of enthusiasts of all ages, in order to
inspire ongoing engagement,
learning, creativity, and innovation.
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Kotler’s Brand Conceptual Model
Brand purpose
• Brand purpose inspires your mission and beliefs, and radiates out
through company culture, codes of conduct and business decisions.
• Ultimately it can touch every part of a business.
• For example, imagine a clothing brand that’s founded and run by
people who are passionate about sustainability. It naturally follows
that they will build recycling and energy-saving into their
manufacturing processes and invest in eco-friendly materials.
• They are also more likely to build products designed to last a long
time, since that minimizes waste and reduces the need for more
clothes to be manufactured. They’ll need skilled, engaged
employees who care about quality and are able to innovate and
evolve the product, making it better and better.
• The company culture will reflect values of sustainability, and
employees and customers will be more likely to adopt sustainable
behaviors and habits. All of this starts from a single factor – the
company’s brand purpose.
A company should not start by setting
the brand’s identity. The company
should start by setting the brand’s
purpose. Brand purpose answers the
question of what job is the brand
promising to accomplish for the buyer?
Philip Kotler
Brands with clarity of purpose financially
outperform those without.
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Kotler’s Brand Conceptual Model
Brand purpose
Definition
• A brand purpose is essentially a brand’s
reason for being beyond making money.
• It’s important to not confuse this with a
‘brand promise’. A brand promise may give
the buyer an idea of what to expect from the
product or service, but the brand purpose
goes way beyond that.
• A brand purpose connects with consumers on
a more emotional level. Likewise, brand
purpose isn’t the same as social purpose,
though there are similarities. To clarify this, a
brand purpose is about product-led initiatives
which strive to simultaneously achieve
business and benefit society.
• David Aaker, an expert in brand building, has suggested
that a brand should not only define its functional purpose,
the job that it is going to do, but also to express the
brand’s higher purpose. The higher purpose suggests
emotional and social benefits coming from choosing that
brand.
• Coca Cola’s functional purpose is to “relieve thirst with a
good taste.” Its higher purpose is to “deliver happiness”
• If that is the space in which Coca Cola wants to operate, it
can go further than just delivering happiness by drinking
Coke. Coca Cola could move into creating entertainments
and theme parks that deliver happiness and Coca Cola will
end up competing with Disney.
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Kotler’s Brand Conceptual Model
Brand purpose
What Brand Purpose IS NOT
• Corporate social responsibility is great and should
be promoted worldwide. However, it’s still not
the same as brand purpose. Brand purpose needs
to be related to what the brand is selling or
providing. A fancy car company can paint a village
for free as a way of donating their time and
energy for a good cause. But that doesn’t say
anything meaningful about the actual product
the fancy car company is selling.
• Similarly, brand purpose isn’t synonymous with
philanthropy. A brand can donate a ton of money
to charity, but this still doesn’t say anything about
their product.
Why we exist
What we aim to
achieve
How we aim to
achieve it
What we stand for
and how we behave
How we differentiate
from competition
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Kotler’s Brand Conceptual Model
Brand purpose
Brand purpose sits among a number of other
terms related to company organization and
direction, but they don’t all mean the same thing.
You can think of purpose, vision, mission and
values as a nested set, with brand purpose as the
starting point that everything else flows from.
• Brand purpose
The overarching reason for being behind your brand, and what it
contributes to the world.
Example:
Make zero-carbon transport a reality for all
• Vision
The long-term goals you strive for
Example:
Make affordable, safe electric vehicles available to every person
in North America
• Mission
How you will achieve your goals
Example:
In manufacturing, marketing and servicing our electric vehicles,
we will continually innovate and strive for lower costs and higher
quality. We will always put safety first in everything we do.
• Brand values
How you behave and act as you do business – the essence of
your company culture.
Example:
Trust, teamwork, accountability, passion and focus
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Kotler’s Brand Conceptual Model
Brand purpose
• Knowing the deeper ‘why’ your company or brand exists provides the
foundation on which to build everything else — your ‘how’
(organizational culture, brand experience) and your ‘what’ (what
products or services you offer).
• The clearest example is Tesla. This is Tesla’s original brand purpose:
Tesla’s mission is to accelerate the world’s transition to sustainable
transport.
• ‘How’ they did it was by creating a culture of technology, design and
innovation fueled by a gigantic ambition to move the world away
from polluting fossil fuels.
• What’ they created to do it, was a series of supercool electric
vehicles as well as the entire infrastructure (a network of charging
stations, a massive Gigafactory to make cost-efficient batteries) to
support them.
• As Tesla founder Elon Musk himself put it:
“Putting in long hours for a corporation is hard. Putting in long hours for
a cause is easy.”
• The people who work for Tesla are galvanized
by the sheer ambition behind the brand
purpose of the company, which invests their
work with meaning.
• Similarly, the customers who buy Tesla
vehicles are also drawn to the deeper ‘good’
that driving a supercool electric vehicle
results in: zero emissions to combat climate
change and being on the cutting edge of a
clean energy revolution.
A powerful brand purpose sets out
a company’s intent to change the
world for the better and connects
with consumers on a personal level.
The rise in conscientious consumers
means that you need to think about
the social, environmental,
ecological and political position of
your brand.
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Kotler’s Brand Conceptual Model
Brand purpose
WHY IS IT IMPORTANT TO
HAVE A BRAND PURPOSE?
• Here are some key advantages to having a brand
purpose:
• Your brand purpose adds value not just to the
lives of customers but to society as a whole.
• Having a brand purpose can help build a more
emotional relationship between a brand and its
consumer, which in turn, helps to boost sales as
well as loyalty.
• A unique brand purpose can differentiate your
brand from competitors.
A 2018 study by specialists found that:
• “78% of Americans believe companies must do
more than just make money; they must positively
impact society as well”
• “77% feel a stronger emotional connection to
purpose-driven companies over traditional
companies”
• “66% would switch from a product they typically
buy, to a new product from a purpose-driven
company”
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Kotler’s Brand Conceptual Model
Brand purpose
Examples
• Unilever
• Super-corporation Unilever has publicly put its faith in brand purpose, with CEO
Alan Jope stating: “Two-thirds of consumers around the world say they choose
brands because of their stand on social issues, and over 90% of millennials say
they would switch brands for one which champions a cause.”
• Jope wants every Unilever brand to have a purpose, and was even quoted by
Forbes as saying “brands that don’t stand for something will be disposed of”
• Within Unilever’s stable of fast-growing purpose-driven brands, a diverse range
of values and causes is represented.
• Ben & Jerry’s ice cream is aligned with climate change and anti-racism,
• Dove champions women’s self-esteem and body positivity,
• while anti-bacterial soap brand Lifebuoy seeks to improve health and
hygiene in developing countries.
• Unilever itself has not chosen a particular cause, but is committed to giving every
brand the time and space to find its purpose and express it.
Identify your
purpose
• The first step to
discovering your brand
purpose is defining
your “why.” And the
best way to do that?
Asking yourself some
deeper questions.
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Kotler’s Brand Conceptual Model
Brand purpose
Identify your purpose
To help you further define your why, what, and how, here are some
questions to focus on:
• Why did you start this particular business, other than the desire to
make money?
• How do you differ from other options or competitors? What are
your special strengths? (e.g., experiences, abilities, values,
processes, or proprietary offerings)
• What is it you want your business to be known for?
• What particular problems are you attempting to solve?
• What is the change you want to make in the world /society /
community?
• In what ways can you uniquely help alleviate such a problem and
make that change in the world?
• What are the specific things you’re looking to change in your
industry?
• What are your customers saying, and what changes are they
seeking?
But where to look for the
answers??
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Kotler’s Brand Conceptual Model
Brand purpose
Identify your purpose
• Where do you discover Purpose?
Creating new brands with purpose at their heart is easy. But what if you’re a
decades-old brand that has well-established attributes — but no clear brand
purpose at it’s heart?
• there’s a process whereby brands can ‘discover their Purpose’ using the
following methodologies:
• 1. an archeological dig
• 2. a brand evaluation
• 3. ask your employees
• 4. ask your customers
1.
An archaeological dig
A deep-dive into the history and heritage of the brand, the story of the founders,
it’s reason for coming into existence in the first place.
• For example, Unilever was founded by William Heskith Lever in the 1890’s who
started with Sunlight Soap, which helped revolutionize hygiene in Victorian
England. Here’s what he wrote down as it’s purpose:
“To make cleanliness commonplace; to lessen work for women; to foster health
and contribute to personal attractiveness, that life may be more enjoyable and
rewarding for the people who use our products”.
• Today Unilever is a multi-billion dollar company which has it’s stated
purpose “helping people to look good, feel good and get more out of life.”
2.
A brand evaluation:
Looking at a brand’s strengths (what you are good at) and passions (brand passion
points), and their intersection with how the brand can be of service to the world.
• For instance: Red Bull’s purpose is ‘to revitalize mind and body’ (expressed in
the form of their tagline ‘Red Bull Gives You Wings’. They are passionate about
the world of action sports, and they have become really good at creating brand
experiences and content that were of service to that community.
• The result? A company that allegedly makes more money from that content
and experiences than the drink .
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Kotler’s Brand Conceptual Model
Brand purpose
Identify your purpose
3. Ask your employees:
Finding out the stories of why they are proud to work for your company or brand
often unearths the real value that they see in the work that they do.
4. Ask your customers:
Similarly, asking your customers (and associated stakeholders like retailers, suppliers
and other partners) can help unearth valuable insights as to the distinctive, own-able
higher-order purpose for your business.
By integrating these sources of
research and data, a brand can
uncover a compelling brand
purpose which can help it futureproof itself for generations to
come.
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Kotler’s Brand Conceptual Model
Brand purpose
• Lest you think that this approach only works in developed markets, here’s
another favorite example from the paint brand Dulux, whose purpose is to ‘add
color to people’s lives’.
• They believe that color means emotion: optimism, positivity, inspiration. They
backed that up with the Let’s Colour project which gives neighborhoods around
the world free paint to brighten up schools, car parks, and other community
areas. The result? Over 1200 projects around the world in Asia, South America
and Europe- and a positive impression of the brand more lasting than any shortterm piece of billboard ever could.
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Kotler’s Brand Conceptual Model
Measuring Brand purpose
How Brand Purpose Is Being Measured
• Along with measuring the effectiveness of purpose on
brand performance, more organization are measuring
the actual impact purposeful efforts are making on the
world.
• The “Purpose Power Index” is a measurement tool used
to assess the power of the company’s purpose in building
the brand’s Equity.
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Kotler’s Brand Conceptual Model
Measuring Brand purpose
The index comprises more than 20,500 individual ratings from over
5,500 U.S. consumers and employees, encompassing more than 200
brands from 50 industries. The research was conducted via online
survey in April 2022, as part of the study's third wave, following one in
2019 and another mid-pandemic in 2021. A fourth study is planned
for 2023.
1.Seventh Generation
2.TOM’S
3.Zoom
4.Allbirds
5.AbbVie
6.Burt’s Bees
7.Wegman’s Food Markets
8.USAA
9.Tesla Motors
10.REI
11.Google
12.UnitedHealth Group
13.Pfizer
14.LG Corporation
15.Clorox
16.General Electric
17.Patagonia
18.Panera Bread
19.Toyota
20.Roche
New entrants listed in bold.
“The big story here is how the shared pandemic experience has
dramatically changed the public’s perception of how purpose-driven
a brand is,” said Chip Walker, study lead and StrawberryFrog head of
strategy. “Pfizer is a huge purpose success story from No. 90 in 2019
to 49 in 2021 and 13 this year. Roche also sky-rocketed toward the top
at No. 20.”
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Let’s
exercise
§ The vision, mission and value are the inspiration for brand purpose
§ What are the 4 places which can help in finding and developing your
brand purpose?
True or False
§ Nestle water is aiming at supplying all Egyptian villages with running water
by 2030. this is called
• Purpose
• Vision
• Mission
• Value
§ A powerful brand purpose sets out a company’s intent to change the
world for the better and connects with consumers on a personal level
§ The purpose index comprises 5 elements which are?
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KOTLER’S BRAND
CONCEPTUAL MODEL
Brand Positioning
66
Kotler’s Brand Conceptual Model
Brand Positioning
Brand
Purpose
Brand
Positioning
Brand
Differentiation
Brand Identity
Brand Trust
Brand
Beneficence
It is common to distinguish brands
according to their positioning.
Positioning a brand means emphasizing
the distinctive characteristics that make
it different from its competitors and
appealing to the public. It results from
an analytical process based on the four
following questions:
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Kotler’s Brand Conceptual Model
Brand Positioning
1.
A brand for what benefit? This refers to the brand
promise and consumer benefit aspect: Orangina has
real orange pulp, The Body Shop is environment
friendly, Twix gets rid of hunger, Volkswagen is
reliable.
2.
A brand for whom? This refers to the target aspect.
For a long time, Schweppes was the drink of the
refined, Snapple the soft drink for adults, Tango or
Yoohoo the drink for teenagers.
3.
Reason? This refers to the elements, factual or
subjective, that support the claimed benefit.
4.
A brand against whom? In today’s competitive
context, this question defines the main
competitor(s), ie those whose clientele we think we
can partly capture.
• Positioning is a necessary concept, first because all choices are
comparative, and so it makes sense to start off by stating the area in which
we are strongest.
• Positioning is a concept which starts with customers, by putting ourselves in
their place: faced with a variety of brands, are consumers able to identify
the strong point of each, the factor that distinguishes it from the rest?
• This is why, ideally, a customer should be capable of paraphrasing a brand’s
positioning: ‘Only Brand X will do this for me, because it has, or it is …’
• The above formula was created by companies such as Kraft–General Foods,
Procter & Gamble, and Unilever. It is designed for businesses that base
competitive advantage on their products,
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Kotler’s Brand Conceptual Model
Brand Positioning
• There are cases where the brand makes no promise,
or where the benefit it brings could sound trivial.
• For example, how would you define the positioning
of a perfume such as Obsession by Calvin Klein in a
way that clearly represented its true nature and
originality? It would be wrong to claim that
Obsession makes any specific promise to its
customers, or that they will obtain any particular
benefit from the product apart from feeling good (a
property which is common to all perfumes). In
reality, Obsession’s attractiveness stems from its
imagery, the imaginary world it embodies. In the
same way, Mugler appeals to young people through
its inherently neofuturistic world, and Chanel stands
for timeless elegance.
• In positioning, the brand/product makes a proposition, plus (necessarily) a
promise. The proposition may additionally be supported by a ‘reason to
believe’, but this is not essential. Marlboro presents its smoker as a man – a
real man, symbolized by the untamed cowboy of the Wild West.
• No support is offered for this proposition; no proof is necessary. It is true
because the brand says so. And the more often it is repeated, the more
credible it becomes. In this way the brand’s proposition, which forms the
basis of the chosen positioning at a given moment in a particular market, may
be fuelled by various ‘edges’ contained within the brand’s identity:
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Kotler’s Brand Conceptual Model
Brand Positioning
It can be:
• A differentiating attribute (25 per cent moisturizing
cream in Dove, the smoothness and bite of Mars bars,
the bubbles of Perrier);
• An objective benefit: MACs are user friendly, Dell offers
unbeatable value for money;
• A subjective benefit: you feel secure with IBM;
• An aspect of the brand’s personality: Marlboro is
macho, Axe/Lynx is cool;
• The realm of the imaginary, of imagery and meaning
(Old New England for Ralph Lauren);
• A reflection of a consumer type: successful affluent
people for Amex;
• Deep’ values (Nike’s sports mentality, Nestlé’s maternal
love), or even a mission (The Body Shop).
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Kotler’s Brand Conceptual Model
Brand Positioning
Positioning and Brand Essence
For 50 years, Mars was little more than a chocolate bar. The essence of
Mars is energy; its positioning is as a meal substitute in the UK and as a
revitalizing snack in Europe.
It is this degree of freedom between identity, essence and positioning
that enables a brand to change over time while still remaining itself.
Thus, over time (40 years), Evian has changed its baseline on several
occasions, symbolizing a change in its angle of market attack as the
market itself has changed. It has become increasingly saturated with
competing brands, the original consumers have aged, and low-cost
brands have carved out a significant share.
On each occasion, these changes have led to a re-examination of the
most compelling advantage, There has thus been a shift from ‘water for
babies’ to the purest of waters, water from the Alps, well balanced
water, and now the water of youth However, each positioning has
remained true to the essence of the Evian brand, which is more than
any other water distinguished by its origins, its composition, its first
campaign (babies) and so on. Evian is about life itself.
Positioning of the brand and the positioning of its
products?
• Dove was born as a soap in the United States, but now encompasses
shampoos, shower gels, moisturizing cream, deodorants and so on.
The essence of Dove is ‘Femininity restored’. (Remember, Dove
purpose is: Dove champions women’s self-esteem and body positivity)
But Dove is being launched in a market via one or more products that
have to fight for their own space amid a host of competitors: hence
when Dove soap was launched, its positioning was: ‘Dove is a
premium beauty bar for the mature women, worried about their skin,
which won’t dry your skin like soap because it contains one quarter
moisturizing cream.’
• This example is a good illustration of how the product’s positioning
promotes a consumer attribute or benefit, while the parent brand
specifies the ‘terminal value’ that this attribute and benefit enables
the consumer to reach. When a brand consists of multiple products,
care should be taken to ensure that their respective positioning
converges on attaining the same core value (that of the parent
brand). If this is not the case, either the product requires
repositioning, or the question should be asked whether it is part of
the right brand at all.
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Kotler’s Brand Conceptual Model
Brand Positioning
Positioning Statement vs Tagline
Brand positioning statements are often confused with company taglines or
slogans. Positioning statements are for internal use. These statements guide
the marketing and operating decisions of your business. A positioning
statement helps you make key decisions that affect your customer’s
perception of your brand.
A tag line is an external statement used in your marketing efforts.
Insights from your positioning statement can be turned into a tagline, but it is
important to distinguish between the two.
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Kotler’s Brand Conceptual Model
Brand Positioning
Purpose of a positioning statement in marketing.
• Its purpose is to guide the marketing, production and operational decisions of your
company. You should be able to use a positioning statement as a test to whether any
decision is on-brand.
Positioning statement examples
• Target: Style on a budget.
• Whatever products Target supplies, social offers they make, mobile functionality they
offer, they have to ask themselves: “Does this help us provide style on a budget?”
• Disciplined, company-wide adherence to a clear, easy-to-understand positioning
statement internally is key to building long-term brand value.
• Volvo: For upscale American families, Volvo is the family automobile that offers
maximum safety.
• Home Depot: The hardware department store for do-it-yourselfers.
From positioning statement to tagline.
• A tagline, by comparison, is consumer facing. It is the distillation of the positioning
statement into a catchy, memorable snapshot of the brand that conveys both the benefit
and the personality.
• Look at the taglines of the brands mentioned before and see if you can tell how they
were laddered up to the positioning statements.
• Target: Expect more. Pay less.
• Volvo: For life.
• Home Depot: You can do it. We can help.
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Linking
positioning to
business
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Kotler’s Brand Conceptual Model
Brand Positioning
A new approach called the centrality-distinctiveness (C-D) map, is the first tool that allows
companies to directly connect a brand’s position on a perceptual map with business
outcomes such as sales and price.
Using the tool, managers can determine a desired market position, make resource allocation
and brand strategy decisions, track performance against competitors over time, and evaluate
strategy on the basis of results. In the process, they will find that centrality and distinctiveness
need not be contradictory goals; companies may choose to pursue both—and benefit
substantially.
By focusing on centrality and distinctiveness—dimensions that, unlike narrow product
characteristics, apply to brands in all categories—companies can make comparisons across
categories and geographies. Where a brand falls on the map has implications for sales, pricing,
risk, and profitability. Marketers can also make important strategic assessments such as “This
market is more crowded with distinctive brands than that one.”
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Kotler’s Brand Conceptual Model
Brand Positioning
Centrality – Distinctiveness map
• Unconventional
• Unconventional brands are usually specializing in a niche
product or service and aren’t particularly central. As such,
unconventional brands should expect low sales volumes, and
instead look for profitability through higher prices.
Unconventional brands are not especially appealing to the
population at large. For example, car brands like Tesla fall into
unconventional quadrant
• Key Aspect
• Profitability at low volumes by charging higher rates for their
service due to not standing within a crowded market.
• Challenge
• The niche market brand may be invaded by large companies,
and small marketers may find it difficult to compete.
• Strategic Context
• Migrate from the unconventional to the aspirational quadrant
by making the brand’s unique features more mainstream or
adding mainstream features.
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Kotler’s Brand Conceptual Model
Brand Positioning
Centrality – Distinctiveness map
• Aspirational
• Often attracting the most profitability of the four
categories, ‘aspirational’ brands combine both centrality
and distinctiveness in high measure. This means they hold
mass appeal but can keep their prices high due to a strong
reputation. For example, brands such as Mercedes and
BMW fall into this quadrant which accounts for a solid 30%
of unit sales of cars
• Key Aspect
• Take advantage of high sales volumes and premium pricing.
These trusted brands are well positioned to launch
innovations that redefine the category.
• Challenge
• Often challenged by brands from the more distinctive
unconventional quadrant or more central mainstream
quadrant.
• Strategic Context
• Must focus to make their distinctive features sufficiently
mainstream to be widely appealing without becoming runof-the-mill.
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Kotler’s Brand Conceptual Model
Brand Positioning
Centrality – Distinctiveness map
Peripheral
• Peripheral brands are neither central nor distinctive, yet
they can still generate high profits due to low marketing
and innovation costs. They offer benefits similar to the
central brands; consumers typically buy them as
substitutes, generally because they are attracted by lower
prices or have minimal engagement with the category. For
example, car brands like Hyundai fall into peripheral
quadrant (
• Tend to replicate a product or service of a mainstream
brand and draw in customers with lower prices. However,
business models may still prove profitable due to low
marketing and innovation costs.
• Challenge
• Low marketing and innovation cost result lower
engagement with the category, which in long run effect the
business growth and sustainability of the brand.
• Strategic Context
• May attempt to shift positioning by adding distinctive
features or launching advertising campaigns, but this is an
uphill and expensive battle.
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Kotler’s Brand Conceptual Model
Brand Positioning
Centrality – Distinctiveness map
Mainstream
• Mainstream brands build their central position through
careful engineering and product development to align with
(or even shape) popular tastes and through heavy advertising
to make the brand synonymous with the category. They can
shape markets & consumer preferences more adeptly than
brands in other quadrants can. For example, car brands like
Ford and Chevrolet and popular beer brands like Miller and
Busch fall into mainstream quadrant
• Key Aspect
• Their strategic position calls for risk-averse stewardship of the
brand; they avoid rocking the boat. They are generally
regarded as reliable, recognizable brands.
• Challenge
• The primary competitive challenge to mainstream brands
comes from peripheral and unconventional products that
could become central as consumer tastes shift.
• Strategic Context
• Align centrality with distinctiveness by influencing the market
and generate higher sales volumes by offering lower prices.
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Potential Applications of C-D
Mapping
1.
Assess brand’s positioning strategy
• Measuring customers’ perceptions of a brand’s distinctiveness and linking that
statistically to performance provides an instant check on a strategy’s effectiveness.
2.
Track the competition
• C-D maps reveal a brand’s location relative to others in a way that reflects consumers’
mental representations of the category. This helps focus competitive efforts on actual
rather than perceived competition.
3.
Manage your brand portfolio.
• C-D maps allow companies to compare brand performance and strategy across
categories. Thus a multiple brand company could use the maps to allocate resources
objectively across categories.
4.
Manage global brands
• C-D maps offer a way to visualize differences in consumer perceptions and in
performance across markets. it helps global managers make decisions about brand
standardization versus localization
5.
Track and analyze results
• The two dimensions that C-D maps track—centrality and distinctiveness—are shared
by all brands and remain relevant over time. marketers will be able to gauge how their
actions affect consumer perceptions.
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Examples on
positioning
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Kotler’s Brand Conceptual Model
Brand Positioning
Example
DELTA VS. JETBLUE BRANDING
• As airlines like Delta stopped serving peanuts and
reduced leg room Jetblue entered the market
touting their gourmet snacks and extensive leg
room. Though they did not have international
flights or an extensive frequent flier program, they
broke into the market focusing on friendly service,
snacks, and legroom. Every part of their branding
pushed to communicate the hospitality and fun of
flying, while big airlines like Delta continued to
push their message towards business travelers.
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Kotler’s Brand Conceptual Model
Brand Positioning
Example
CHIPOTLE VS TACO BELL
• For years, Taco Bell held the largest market share
for fast food Mexican restaurants. Consumers
looked to Taco Bell for years for cheap Tex-Mex
food. Chipotle stormed the market by competing
on quality instead of price. Chipotle differentiated
with great branding. From clever jokes on their
soda cups to the hip urban atmosphere the entire
experience works to build brand equity.
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KOTLER’S BRAND
CONCEPTUAL MODEL
Brand Differentiation
84
Kotler’s Brand Conceptual Model
Brand Differentiation
Brand
Purpose
Brand
Positioning
Brand
Differentiation
Brand Identity
Brand Trust
Brand
Beneficence
• When it comes to product
differentiation, a company must identify
the characteristics of its product that
make it different from competing
products. This is called the value
proposition of a product--what makes it
unique. Knowing the value proposition of
a product, the goal is to highlight those
qualities that consumers consider
attractive compared to competing
brands. As the number of brands
proliferates, product differentiation
becomes increasingly important.
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Kotler’s Brand Conceptual Model
Brand Differentiation
Positioning VS Differentiation
• Marketers use the positioning process to identify the distinctive place
they want a product or service to hold in the minds of a target market
segment. Effective positioning is always aimed at a specific
target segment. In fact, positioning tailors the generally focused value
proposition to the needs and interests of a particular target segment.
• Differentiation is closely related to positioning. Differentiation is the
process companies use to make a product or service stand out from its
competitors in ways that provide unique value to the customer.
Differentiation identifies a set of characteristics and benefits that make a
product different and better for a target audience. Ideally these qualities
are things that
• 1) customers value when they are evaluating choices in a purchasing
decision, and
• 2) competitors cannot easily copy. When both conditions exist, the
offering is more attractive to target customers.
• Differentiation is at work any time you’re choosing between two products
in the same category. For example, when you’re buying a soft drink, why
do you choose Coke, Pepsi, Sprite, or Mountain Dew? Is it because of the
taste? The cost? The level of sugar or caffeine? Or is it something less
tangible, like the way you just want to smile when you drink Coke, or you
feel amped up when you drink Mountain Dew? These tangible and
intangible qualities are what differentiate one soft drink from another.
To illustrate, think about
American retail chains
targeting American
households as a target
segment. The table
below identifies the
ways in which three
large retail chains
position themselves to
attract customers and
the key differentiators
they use to set
themselves apart.
Name
Positioning
Differentiators
Wal-Mart
Wide selection
of products
Wide selection; low prices
people want, at
the lowest prices
Target
Trendy,
fashionable
products at
reasonable
prices
Continually refreshed, ontrend product selection
Preferred “goto” shopping
Broad selection of mostdestination for
wanted, upscale brands;
Macy’s
upscale brands
engaging shopping
and current
experience
fashions.
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So, we can see that building a brand is about
initially setting out to develop a brand’s purpose.
Who is the car for and what job will it do for that
customer?
Then the company needs to use positioning and
differentiation to communicate the brand’s
purpose and ultimately enrich the brand identity
..
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KOTLER’S BRAND
CONCEPTUAL MODEL
Brand Identity
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Kotler’s Brand Conceptual Model
Brand Identity
• We pick and choose the people we keep in our
lives based on whether or not we connect with
them.
• These connections are made through shared
characteristics, which make up our
personalities. If we connect with someone, we
make a choice (often a subconscious one) to
keep them in our lives.
• In the exact same way, consumers pick and
choose the brands they want to do business
with, based on whether or not they have a
connection with them.
Your brand identity is how your audience perceives you.
• Without a comprehensive, well-defined brand identity, your
audience might not understand who you are.
• It's important to note that brand identity is not the same as
branding. It's the product of effective branding. Brand
identity is also not the same as visual brand identity, even
though marketers sometimes confuse the two. Brand identity
includes:
1.
2.
3.
4.
Visual Brand Identity
Brand Voice
Brand Values
Brand Personality
• Together, these four components create the look, feel, and
tone of your company/brand to the outside world.
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Visual Identity
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Kotler’s Brand Conceptual Model
Brand Identity
visuals
• A logo and a color palette alone do not
make a brand identity. When designing your
identity,
• You need to create a comprehensive visual
language that can be applied to everything
from your website to your packaging.
Depending on your brand (and the type of
content you plan to create), your needs
may be more expansive, but a basic brand
identity includes:
•Logo
•Colors
•Typography
•Design
System
•Photography
•Illustration
•Iconography
•Interactive
elements
•Video and
motion
•Web design
•Etc….
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Kotler’s Brand Conceptual Model
Brand Identity
visuals
The dairy alternative trend is growing in popularity, and Oatly is
becoming a prominent brand leading the charge. The oat-based
beverage’s bold font and illustrations with striking thick lines
represent the company’s daring ambitions.
Headspace
• Meditation app Headspace also features a cheery color palette that
brings joy (and delivers on the mission of their meditation app:
(less stress, more joy).
• Naturally, the identity extends to their site, app, and even
their Instagram. With inspirational quotes and charming illustrated
characters, they ensure a cohesive experience with every piece of
content.
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Kotler’s Brand Conceptual Model
Brand Identity
visuals
Studio Lush
• Sophisticated brand identities
• For brands courting savvy buyers, the primary goal of branding is
communicating that they’re the sophisticated choice.
• The key to keeping it smart, sophisticated and dare we say, sexy,
is to juxtapose branding elements that communicate luxury, like
glossy black and thin geometric patterns, with more dynamic,
even playful elements like bold colors and unexpected fonts.
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Voice and Tone
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Kotler’s Brand Conceptual Model
Brand Identity
Voice and Tone
“The way a brand looks is just as important as the way
it sounds.”
What is brand voice?
• Brand tone of voice is a consistent way of conveying
your brand message to your audience.
• It’s a part of a brand expression that together with more
tangible visuals define your brand identity.
Uber
Uber’s tone of voice provides a set of core elements to
define quality writing across all touchpoints.
The Uber brand voice is considerate, simple, bold and
consistent.
Uber brand voice guidelines shows you a bunch of
examples on how to write copy (before and after).
Uber’s voice expresses the brand’s
essence signaling what the brand is,
what it stands for.
Considerate means that writing should
be audience-first.
Simple & Direct refers to writing in a
straight-forward and easy to understand
way.
And consistent obviously tries to unite
the experience across all departments,
countries and languages.
So that they can all together create the
feeling: “that sounds like Uber.”
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Kotler’s Brand Conceptual Model
Brand Identity
Voice and Tone
Harley-Davidson
Harley-Davidson is a perfect example of how a more aggressive
tone can be used for the right brand.
The Harley-Davidson voice is strong, confident and aggressive.
Some brands try to speak in a pleasant and cheerful way or with
a playful and fun voice, but Harley is definitely not one of them.
Harley-Davidson tone of voice challenges the reader to show that they are worthy of handling
one of their motorcycles.
The brand clearly fits the Outlaw archetype, therefore their personality is rough and rugged, so
it’s their voice.
They show their personality through a unique and consistent tone of voice that speaks well to
their target audiences.
This type of voice resonates well with rebellious, bold, and fiercely independent customers (or
wanna-be).
Everything about their marketing evokes confidence, freedom, patriotism, and masculinity —
just look at their website and the headlines they use.
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Kotler’s Brand Conceptual Model
Brand Identity
Voice and Tone
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Core Value
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Kotler’s Brand Conceptual Model
Brand Identity
Core Value
What Are Core Values?
• Core values are part of a company’s DNA. They define
what an organization stands for, highlighting an expected
and ultimate set of behaviors and skills
Google’s core values
1. Focus on the user and all else will follow
2. It’s best to do one thing really, really well
3. Fast is better than slow
4. Democracy on the web works
5. You don’t need to be at your desk to need an
answer
6. You can make money without doing evil
7. There’s always more information out there
8. The need for information crosses all borders
9. You can be serious without a suit
10.Great just isn’t good enough
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Kotler’s Brand Conceptual Model
Brand Identity
Core Value
Amazon.com’
s Leadership
Principles
Customer
obsession
Ownership
Invent and
simplify
Hire and
develop the
best
Insist on the
highest
standards
Think big
Bias for action
Vocally self
critical
Earn trust of
others
Dive deep
Deliver results
IKEA’s Core Values
1.Humbleness and willpower
2.Leadership by example
3.Daring to be different
4.Togetherness and enthusiasm
5.Cost-consciousness
6.Constant desire for renewal
7.Accept and delegate responsibility
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Personality
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Kotler’s Brand Conceptual Model
Brand Identity
Brand personality
Personality is an important dimension of brand equity because, like human
personality, it is both differentiating and enduring.
Brand personality directs the voice, tone and style through which the brand
communicates.
What's your brand personality?
Your brand is more than just your logo and slogan—brands, like people, have
personalities.
People want to see the humanity within a business.
Like people, brands without personalities are just plain boring.
If your brand was a
person, how would
you describe him
or her?
Brand Personality Definition
• Brand personality refers to human characteristics associated with a brand.
• They’re expressed as adjectives that convey how you want people to
perceive you (e.g. cheerful, youthful, dependable, friendly, responsible,
sophisticated and so on).
• It can also refer to demographic characteristics like gender, age, and social
class. For example:
• If Harley Davidson were a person, it would be a man. Victoria’s Secret, a
woman.
• Apple would be a young, hip, creative and Microsoft would be a
mature professional.
• Chanel would live in a mansion and TJ Maxx would live in a low-rent
apartment.
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Kotler’s Brand Conceptual Model
Brand Identity
Brand personality
Nike
The personality of Nike is excitement.
A brand can serve as a person’s personal statement even if that person
were stranded on a desert island.
Nike has an active lifestyle, inspirational, exciting, cool personality.
Nike-as-a-person would be exciting, provocative, spirited, cool, innovative,
aggressive, and into health and fitness.
Tesla
• The personality of Tesla is excitement &
sophistication.
• We use brands as self-expressive
statements, particularly the cars we drive
and the clothes we wear.
• Tesla has an exciting, visionary,
charismatic, courageous, spiritual
personality.
• Driving a Tesla provides a self-expressive
benefit—others will observe and make
judgements about you.
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Kotler’s Brand Conceptual Model
Brand Identity
Brand personality
Volvo
• The personality of Volvo is sincerity & competence.
• A trustworthy, dependable, conservahve personality might
be boring but might nonetheless reflect characteristics
valued in an auto brand such as Volvo.
• Volvo has a responsible, trustworthy, reliable, family-man
personality.
• The emotional positioning of the Volvo brand is firmly
connected with sincerity and competence.
BRAND IDENTITY VS. BRAND IMAGE
• Brand identity (you can control this): It’s the voice you
give your product or service.
• Brand image (you can’t control this): It’s what your
customers hear.
• After you identify the attributes of your business you’ll have
established your brand identity.
• And over time, you will build your brand image by selling and
creating raving-fan customers (and possibly investors).
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KOTLER’S BRAND
CONCEPTUAL MODEL
Brand Trust
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Kotler’s Brand Conceptual Model
Brand Trust
Brand
Purpose
Brand
Positioning
Brand
Differentiation
Brand Identity
Brand Trust
Brand
Beneficence
• Just as you can’t trust a person whom you can’t depend on,
consumers don’t trust brands that they can’t depend on. And you
certainly can’t expect consumers to buy your brand, stay loyal to
your brand, and tell other people positive things about your brand
if they don’t trust it. Bottom-line, building brand trust is a
fundamental part of developing your brand, and it needs to be
prioritized as such.
• A brand needs brand trust so that customers will believe that the
brand will deliver what it claims.
• Apple customers trust that their Apple phones and Apple
computers will deliver what the company claims.
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Kotler’s Brand Conceptual Model
Brand Trust
A change in consumer behaviour
• Faced with previous bad experiences as buyers, modern consumers
are slowly drifting away from traditional marketing channels and
turning to their inner circles or social media platforms.
• They search for proof at every step of the process, starting with
reading lots of reviews about the product, which may convince
them to make the purchase.
• According to research, a consumer needs to read on average 100
reviews until they’re confident enough to purchase a product
online.
• After establishing trust with their customers, brands can reap the
benefits as their clients become their very own advocates.
• To successfully turn your clients into advocates, your brand will
have to meet their needs, but also it will have to build a solid online
reputation.
• We trust ads less and influencers more. The demands of the
modern consumer are higher. Customer experience has become so
crucial for today’s shoppers that brands cannot allow themselves to
make any mistakes.
• Nowadays, it’s easier than ever to buy something online, yet the
purchase decision is influenced by so many factors.
A study done on the benefits and drivers of brand revealed that:
• When people trust a brand,
• 83% would recommend it
• 82% will use its products or services frequently
• 78% will look at it first for the things they are looking for
• 78% will give its new products and services a chance
• 50% will pay more for its products and services
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Kotler’s Brand Conceptual Model
Brand Trust
The benefits for trusted brands
Loyalty:
75% of people with high brand trust said:
• They’ll buy the brand’s product, even if it isn’t the cheapest.
• It’s the only brand (of this product) they’ll buy.
• They’d be very interested in checking out and buying a new product from the
brand.
Engagement:
60% of people with high brand trust said:
• They’re comfortable sharing personal information with the brand.
• They pay attention to the brand’s advertising and marketing communications.
Advocacy:
78% of people with high brand trust said:
• They’ll likely share or repost content about the brand, or share their
experiences with the brand.
• They’ll recommend the brand to others.
• They’ll defend the brand against criticism.
So... What do we need to do to build trust?
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Kotler’s Brand Conceptual Model
Brand Trust
1.
Consistency
•
•
2.
Powerful brands develop as people begin to believe the brand
promise based on their experiences with that brand. Those
experiences develop into perceptions and expectations. If your brand
doesn’t meet consumer expectations in every customer interaction,
they’ll become confused and turn away from your brand in search of
one that does meet their expectations in every interaction.
Don’t let them get away! Use your brand identity guidelines to
ensure your brand is always presented in a consistent manner.
Persistence
•
•
•
3.
Brands aren’t built overnight. To build a brand, you need to be
patient and don’t give up.
Continually put out messages and brand experiences that
consistently communicate and support your brand promise. This is
how you develop brand awareness, recall, purchase intent, loyalty,
and advocacy.
Entertainment brands provide excellent examples for persistence in
brand building. For the Hollywood crowd, any day that a celebrity
isn’t in the news is a step closer to being out of the business.
Celebrities are trained to stay top-of-mind or they’ll lose their
relevancy, their popularity, and ultimately, their incomes. —
persistence in brand building.
Restraint
•
•
It can be tempting to extend your brand into new markets, product
lines, and regions when the potential to make more money dangles
in front of you like a carrot on a stick. However, everything your
business does must consistently communicate and represent your
brand promise.
Therefore, you must exercise restraint. Because if you don’t you
could do more harm to your brand and business than good. Don’t
give into temptation without thoroughly analyzing opportunities to
ensure they are an appropriate fit for your brand.
4. Track your brand trust goals
• To start with, you’ll need to decide what your brand trust goals are and
how you’re going to measure them.
• You can use something as simple as Google Alerts to monitor your brand
keywords
• You can also monitor brand trust by checking out relevant review sites
like Google My Business, Yelp, and Trustpilot. Or…,
• you could run customer satisfaction surveys, such as Net Promoter or
Survey Monkey.
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Kotler’s Brand Conceptual Model
Brand Trust
5. Be authentic through brand storytelling
• Brand storytelling is the process of creating a compelling narrative
around your brand that connects with your target audience.
• Consumers want to know who your brand is and what you stand for –
your values, your goals, and your culture.
• So you need to cultivate an authentic look, feel, and sound for your
brand.
6. Get customer input
• It’s imperative to continue a dialog with your customers after they’ve
purchased your product or service. Getting to know your customers
helps you support them and build more profound levels of trust in your
brand.
• Customers will feel more valued and more loyal to your brand if you
take the time to hear what they have to say.
7. Focus more on customer relationships than revenue
• If your sole focus is to generate revenue at all costs, then you’re likely not
focusing on customer relationships. But, in essence, the two go hand-inhand.
• If you build on-going relationships with your customers, then they’ll turn
into your biggest fans and recommend you to their friends and
colleagues, which in turn brings more revenue, and so the cycle begins
again.
8. Build social proof
• Social proof in the form of positive customer reviews and testimonials is
an excellent way to attract new business. As noted earlier, customers
trust other customer opinions and reviews more than your own content.
• 70% of consumers look at multiple review sites, so it’s important to use a
selection of relevant sites for your brand.
9. Make sure your brand acts responsibly
• Consumers expect companies to be socially responsible.
• Whether you’re reducing your carbon footprint, responding to the global
pandemic, or supporting racial equality, it’s important to back up your
words with actions to avoid being seen as exploitative or opportunist.
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Kotler’s Brand Conceptual Model
Brand Trust
• In conclusion, As a result of the global crises, people now expect brands
to take a stand and advocate for change, inspire hope, and use their
brand to improve society.
people are looking for honesty and integrity, and have to
avoid a rapid response and think about the long term –
sustaining brand trust
Today, the responsibility of a company is to do good in the
world. Brands need to be more human and authentic than
ever before.
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KOTLER’S BRAND
CONCEPTUAL MODEL
Brand Beneficence
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Kotler’s Brand Conceptual Model
Brand Beneficence
The Age of CEO Activism
47 percent of Millennials believe CEOs have
a responsibility to speak up about issues
that are important to society.
• Traditionalists strongly believe that companies should “stick
close to their knitting” and work hard to create profits to
satisfy the expectations of the company’s owners and
investors.
• Why would investors want to receive less than the maximum
return? Why let CEOs decide on which social problems the
company should invest its hard-earned profits? Let investors
make the social decisions that they want.
• Normally, social problems are supposed to be the
responsibility of government and nonprofit organizations
(NPOs).
• The only other group that can offer help in solving social
problems are business organizations.
• Unilever’s website tells us more about their way of
thinking: Research shows that consumers are actively choosing
to buy brands that they believe are doing social or
environmental good. This is why we are developing our
‘sustainable living’ brands.
• Some businesses, such as Starbucks, Unilever, IBM, and others have
CEOs who are willing to assume some responsibility for social
problems. Noting the problems in the U.S. health care system, CEO’s
Warren Buffet, Jeff Bezos and Jamie Dimon recently joined together
to design a better health care plan for their employees .
• And CEO Tim Cook of Apple said that as government fails to deliver,
business and other areas of society need “to step up.” All
businesses benefit from a well-working economy with good
infrastructure and well-trained and motivated workers.
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Kotler’s Brand Conceptual Model
Brand Beneficence
• Beneficence is defined as the quality or state of being beneficent.
Merriam-Webster dictionary[1] defines beneficent as doing or
producing good. Especially: performing acts of kindness and
charity. The notion of doing good is very broad and even more so
when discussing ethical theory.
• The final consideration is whether the brand delivers brand
beneficence. Does the brand serve well the person and the
society? Marlboro was the most popular brand of cigarettes. It
delivered taste and high satisfaction. But it also could deliver a
heart attack, liver damage and “bads” to others in the smoke
vicinity.
• Companies in a free society can freely decide what they want to
make and sell but they should consider whether the brand has a
beneficence problem and whether this will ultimately hurt the
brand. Consider that our food industry makes heavy use of sugar,
fat, and salt, all leading to obesity and certain illnesses. As more
consumers become conscious of these ill-effects, they may retreat
from using the product or brand.
• A socially responsible company needs to shape its offerings to
minimize personal or societal ill-effects of their brand offering.
What Is Ethical Marketing?
• Ethical marketing refers to the process by which companies market their goods
and services by focusing not only on how their products benefit customers,
but also how they benefit socially responsible or environmental causes.
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Kotler’s Brand Conceptual Model
Brand Beneficence
Ethical Marketing Example : TOMS
• TOMS ballet flats are cute, comfortable, and best of all, socially
conscious.
• TOMS isn’t just engaged in corporate philanthropy to make a quick
buck; it’s a core part of the company’s values and brand.
TOMS was founded by Blake Mycoskie in 2006 following a trip to
Argentina. During his visit, Mycoskie saw firsthand how people
living in impoverished areas of Argentina had to live without shoes,
a challenge that many of us likely give little thought.
• Inspired by his trip, Mycoskie decided to establish his company with
giving in mind.
• Since 2006, TOMS’ footwear business has donated more than 60 million(!)
pairs of shoes to children in need all over the world. As if that weren’t
enough, TOMS’ eyewear division has given more than 400,000 pairs of
glasses to visually impaired people who lack access to ophthalmological
care.
• The company has further diversified its operations to include clean water
initiatives through its coffee business, and its line of bags has helped
support projects to expand access to birthing kits to expectant mothers in
developing nations as well as training for birth attendants. To date, TOMS
has helped more than 25,000 women safely deliver their babies.
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Kotler’s Brand Conceptual Model
Brand Beneficence
How Does TOMS Use Ethical Marketing?
• TOMS puts its social and environmental philanthropy on full display in virtually every
aspect of its branding. This not only lets potential customers know the kind of
company they’re dealing with right off the bat, but also reinforces TOMS’ brand
values consistently across all channels.
• Take a look at TOMS’ homepage. Right underneath the carousel, the company tells
you that, for every product you purchase, TOMS will help someone in need:
Create a movement or community.
• Using emotional marketing to establish a movement or community around your brand taps into
a few different psychological triggers. The bandwagon effect it creates keeps people intrigued by
what the crowd is doing. Also, feelings of camaraderie, acceptance, and excitement can create a
sense of loyalty to your brand.
• TOMS does a great job of crafting this sense of community. When you purchase a pair of TOMS,
you not only help someone in need, but you also join the TOMS community. You now belong.
The marketers at TOMS enhance this community by promoting activities like “One Day Without
Shoes” and encouraging their customers to use hashtags when sharing images.
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Kotler’s Brand Conceptual Model
Brand Beneficence
“ETHICS” IS THE NEW TREND?
• Nowadays, people are more aware of their social and
environmental impact. They have developed an empathy that
allows them to care about the environment they live in. New
values are becoming more and more “trendy” and businesses
are trying to associate these values with their brands. After all,
who doesn’t want to buy something new and have a feeling
that they have accomplished something good for the planet?
But these associations can be quite hard to make.
• You can’t just give a statement saying, “I am an ethical brand”
and except people to trust you. People want tangible proof of
your ethical actions. In an era of constant technological
improvements and fast communication, information cannot be
hidden for a long time. It means that brands cannot hide
anymore what they really are. Few years ago, Peugeot was in a
very critical position when controllers found out that they have
deliberately falsified their pollution measurer. They were
obligated to pay a fine of €5 billion. But more importantly, their
brand image was highly affected because Peugeot appeared to
be a brand we cannot trust (“Dieselgate : Peugeot menacé
d’une amende de 5 milliards d’euros”, 2018).
• Ethical marketing relies on a long-term strategy of continuing
education, campaigning, and activism. It’s about helping consumers
make better, more conscious choices about the products they buy
and the stores they frequent. It’s about changing the way we think
about how goods are provided, the people who make and sell the
things we buy every day, and the communities that rely on fair,
ethical trade to survive. It’s about cultivating brand loyalty by
aligning your organizational values with those of your ideal
customers.
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Chapter 4
Building a brand portfolio
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Marriott International is one
of the largest hotel chains in the
world, with a portfolio of
brands including The Ritz-Carlton,
Sheraton, Le Méridien, JW
Marriott, Courtyard by Marriott
and others;
BMW Group is one of the
largest automobile manufacturers
in the world with a portfolio of
brands like BMW, Mini and RollsRoyce;
Mondelēz International is
one of the world’s largest
confectionery, food, and
beverage companies in the
world with a portfolio of
brands like Oreo, Cadbury,
Tang, Chiclets and others.
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When companies
attempt to run each of
their brands totally
separately from one
another, confusion
and inefficiency can
prevail.
In contrast, by utilizing
a brand portfolio the
organization is able to
focus on the big
picture. This allows
resources to be better
distributed to where
they can do the most
good. so creating the
most value as well as
reducing needless
overlap.
EVERY ORGANIZATION
NEEDS TO CONSIDER ITS
BRAND PORTFOLIO. EVEN IF
A COMPANY HAS ONLY ONE
BRAND, IT MAY DECIDE TO
LAUNCH OR ACQUIRE A
NEW BRAND OR INTRODUCE
A SUB-BRAND OR BRANDED
SERVICE. ALL OF THESE
MOVES IMPACT THE
BROADER BRAND
PORTFOLIO.
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1. The primary brand is the main name on a
product or service. This is generally the largest
branding element on a product package or in a
piece of communication. This is also what
people refer to when they talk about the brand.
Facebook, Apple, and Lufthansa are all primary
brands.
By definition, every brand has a primary brand. The
very simplest branding structures have just a
primary brand and product description.
Some
important
Definitions
The primary
brand
Brands such as McDonald’s restaurants, Starbucks
coffee, Northwestern University, and Google search
engine are all examples of a primary brand followed
by a product description.
2. Sub-brands are secondary brands that fall
below the primary brand in prominence. In most
cases, the sub-brand will be more prominent
than the descriptor that follows it. The key
distinction is that the primary brand continues to
be the most important branding element. For
example, Honda uses a sub-brand system for
many of its vehicles. The Honda Civic compact car
has a primary brand (Honda), a sub-brand (Civic),
and a descriptor (compact car).
• Sub-brands can vary substantially in prominence,
but there is a limit to how important the subbrand can become; if the sub-brand becomes
more prominent than the primary brand, then
the sub-brand is actually the primary brand.
• Hyatt Corporation used a sub-brand structure
when it launched Hyatt Centric in 2015, a new
line of hotels targeting millennial travelers. Hyatt
was eager to reach young, digitally savvy
travelers, a segment it called “modern
explorers.”
• With a sub-brand structure, Hyatt hoped to
capitalize on positive associations with the Hyatt
brand, while also indicating that this new line of
properties was somewhat different and unique
and targeted to a very specific demographic.
• Later on Hyatt Centric became a brand by itself
as strong as the Hyatt brand alone
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3. Endorser brands
• Companies will use an endorsement branding
strategy to highlight a connection to another
brand
• Marriott Corporation makes extensive use of
endorser brands in its portfolio. The
company’s brand portfolio includes
• Residence Inn by Marriott,
• Courtyard by Marriott,
• AC Hotels by Marriott,
• Protea Hotels by Marriott,
Some
important
Definitions
The primary
brand
• and many other brands that carry a Marriott
endorsement.5 The goal of this approach is to
let people know that the different brands have
a connection to Marriott, which means
travelers can count on a certain level of quality
and reliability as well as a common rewards
program.
4. Ingredient and Service Brands Companies can brand
ingredients in addition to branding the core product or
service
• Ingredient branding is commonly used to differentiate
from competitors. If a company can brand one of its
ingredients, it becomes a point of differentiation. A
vague phrase, such as “heavy duty” or “high quality,” is
easy for competitors to copy.
• A branded ingredient or service is different because it is
legally protected, so it cannot be copied by
competitors. A branded ingredient or service can
become an enduring point of differentiation. A
competitor could create its own ingredient brand, but it
can’t use the same one.
• This is a fairly common approach to differentiation. For
example, Glad trash bags employed this strategy by
adding a fragrance to its bags and creating a branded
ingredient, OdorShield. The brand OdorShield wasn’t
part of the product name, but it was prominently
featured on the package. Similarly, Chrysler created an
ingredient brand around an engine, the Hemi, to
indicate a high level of performance. In hotels, Westin
introduced the Heavenly Bed.
• Service brands are similar to ingredient brands but are
used for particular service offerings. Air France-KLM
created a new brand for its rewards program, Flying
Blue. Lufthansa used a similar approach with the Miles
& More brand.
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Brand Portfolio Models
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• There are two basic models for
brand portfolios: “house of brands”
and “branded house.”
• Under these 2 models fall the
endorser brands and the sub-brands.
• Companies employ both models
widely, and combine between them
making a “Hybrid” model.
• Whichever the strategy used for the
brand models they do have their
benefits and challenges
Models
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Branded
House
• Branded House The opposite brand portfolio strategy is the branded house. In this
model, a company takes a single primary brand across multiple products and
categories. Purely executed, all the products a company produces are sold under a
single brand name. Most often the corporation has the same name as the primary
brand.
• Uber is an example of a
branded house. The company,
founded by Travis Kalanick and
Garrett Camp in 2008,
operates solely under the Uber
brand. In a bid to drive growth,
Uber has expanded its product
offerings, providing food
delivery and unique
experiences. It continues to
leverage the Uber brand name.
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Branded House
• Virgin Group is another example
of a branded house. British
business leader Richard Branson
created the brand in 1971. The
company first operated a music
store in London, then gradually
expanded into new businesses:
airlines, telecommunications,
financial services, soft drinks,
wine, and many more. The Virgin
brand is used across almost all of
these categories, making Virgin
one of the most broadly applied
brands in the world
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• House of Brands The classic and most
powerful model for a brand portfolio is
the house of brands. With this model, a
company will own a number of different
brands, possibly with several different
brands in the same category. Each brand
exists on its own. The company
minimizes cannibalization and
redundancy by creating a distinct
positioning for each brand.
In a particular category, for example,
one brand may target price-sensitive
customers and compete on low prices,
while another brand may target
performance-oriented customers and
compete on technical features.
Companies employing the house of
brands model often use a distinct
corporate name. As a result,
consumers are often unaware that a
company’s brands are all owned by the
same parent.
House of
Brands
Procter & Gamble is a classic example
of a company employing a house of
brands approach. The company owns
dozens of different brands, including
Dawn, Crest, Charmin, Bounty, Gillette,
and Always. Each brand is distinct: the
P&G brand is not used in a meaningful
way on any of the products. Indeed,
the only way a customer would know
the brands are owned by P&G is by
studying the fine print on the back of
the label or spending some time on
Google.
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Hybrid Model
• The hybrid model aims to incorporate
elements of both the branded house and
house of brands models to give each
brand maximum advantage, either
through endorsement or independence.
• Hybrid brand architecture is often the
result of acquisitions, whereby the
parent brand decides on a case-by-case
basis what the most beneficial brand
strategy is when it acquires each new
brand — either absorb it into the parent
brand, retain some element of the
existing brand but endorse it with the
parent brand or to leave it intact.
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Benefits and Challenges of
different brand models
Branded house there is a single master brand, one trademark followed by
descriptive names for each product/service.
Benefits :
• It is easier for consumers to recognize the products.
• It increases brand awareness
• Focusing brand marketing (and marketing spending) on a single brand strategy.
Challenges :
• If a product/service goes through a crisis, the whole brand may suffer – any
negativity associated with a service/product is attributed to the brand and all its
other products/services
Endorsed brands: Individual product brands, linked together by an endorsing
parent-brand. Although the product brands have their own identities, there is a clear
connection between them and the parent brand.
Benefits:
• An endorser brand can work as assurance of quality for the product brand, it can
increase consumer’s perception and confidence
• Marketing activities advertise both the product brand and the endorser
• The connection between product brands can facilitate cross-selling
Challenges:
• If a brand goes through a crisis it is hard to control the damage because the crisis
can extend to the parent brand and also to the other brands.
• There will be creative, legal, and time-to-market costs for every endorsed brand
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Benefits and Challenges of
different brand models
House of brands : Separate identities for each brand. It is common for the consumers to
not be aware of the parent brand.
Benefits:
• If a free-standing brand goes through a crisis, it is not “contagious” to the other brands
• Full liberty in creating the identity: freedom to create different brand strategy, name, logo,
design, and creative campaigns
• Presence in different market niches, targeting different audiences
• There is no need to stretch a brand beyond its positioning: if an opportunity is compelling
but the existing brands in the portfolio are not appropriate, the company can acquire or
launch a new brand.
When PepsiCo saw a need for a carbonated drink to compete with LaCroix sparkling water, for
example, it expanded its portfolio in 2018 by launching a new brand, Bubbly, targeted precisely
at the opportunity. This made perfect sense: extending the Pepsi brand itself into carbonated
water would have created confusion about the new product and confusion about Pepsi.
Challenges
• The fact that every brand needs its own strategy, identity and marketing activities is a
financial disadvantage.
• The time and resources involved in planning and implementing the brand activities will be
greater
• Success will not be directly attributed to the parent brand.
• it can be a challenge to manage. Each brand needs to make decisions about pricing, new
products, advertising, and other matters. If a company doesn’t have an entrepreneurial
culture, a house of brands approach can lead to debilitating complexity.
Sub-brand: There is a corporate trademark and sub-brand trademarks: Each of these
brands may have a distinct brand promise, position and personality.
Benefits:
• You can target many different customers because the sub-brands have different names,
logos, different promises, positions and personality traits – you can address conflicting
audiences.
Challenges:
• Legal and creative / marketing costs of creating new sub-brands
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Benefits and Challenges of
different brand models
The hybrid Model approach can present the best of all worlds.
Benefits
• The awareness and rapid market penetration that a known brand
can lend to either a new offshoot or a smaller acquisition can be
very beneficial.
• But it also allows the flexibility for stand-alone brands where this
would be an advantage.
• Equally, if a brand that is either neglected or has other difficulties
gets brought under the wing of a trusted parent brand, it can help
to negate the negative image of the brand that is acquired.
• In the case of platforms or services such as Bonjorno (acquired by
Nestle), the ability to make the transition in ownership seamless by
leaving the brand intact also helps to retain the brand’s users.
Challenges
• The additional costs and management time that the house of
brands model generates can also apply to the hybrid model,
together with some of the inflexibility and ‘risk by association’ of
the branded house model.
• The other significant disadvantage can be confusion, both from an
external and an internal viewpoint. Customers and brand managers
can just become lost in a morass of brands at various levels of
association and disassociation with the parent brand, not all of
which necessarily makes sense if the situation has arisen
organically over time and goes without periodical review.
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Chapter 5
Brand Architecture
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What is Brand Architecture?
the structure of
brands within an organizational
entity. It is the way in which the brands within a
Brand architecture is
company's portfolio are related to, and differentiated from,
one another.
Brand architecture describes the role of the corporate brand
in marketing products and services, as well as the relation
between all the brands, sub-brands, products, variants, and
acquired businesses in the company’s portfolio. It is often
perceived as an area of interest in big organizations only,
though if you sell just one product or service and need to
decide whether it will be called the same as your company or
differently, it is also a brand architecture decision.
The Product Mix
PRODUCT
MIX
Length
Depth
Breadth
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Consistency
133
The product mix
Length: Total
number of
products
Depth: total
number of
products
within a
product line
The
Brand
Width:
number of
product
lines
• The Product Mix
• Product mix, is the total number of product lines that a company
offers to its customers. The product lines may range from one to
many and the company may have many products under the same
product line as well. All of these product lines when grouped
together form the product mix of the company.
Width
• The width of the mix refers to the number of different product
lines the company has to offer.
Length
• Length of the product mix refers to the total number of products
in the mix. That is, if a company has 5 product lines and 10
products each under those product lines, the length of the mix
will be 50 [5 x 10].
Depth
• The depth of the product mix refers to the total number of
products within a product line. There can be variations in the
products of the same product line. For e.g. Colgate has different
variants under the same product line like Colgate advanced,
Colgate active salt, etc.
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The product mix
Length: Total
number of
products
Depth: total
number of
products
within a
product line
The
Brand
Width:
number of
product
lines
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The product mix
4TH DIMENSION FOR PRODUCT MIX -
CONSISTENCY
• Finally, the consistency of a product mix
completes our four product mix decisions.
Consistency refers to how closely related the
product lines are in terms of end use,
production requirements, distribution
channels or any other way. In Colgate’s case,
we can observe a rather strong consistency,
which is based on the fact that all product
lines constitute consumer products and go
through the same distribution channels. The
vehicle (cars, busses etc…) manufacturer
also has a relatively consistent product mix,
since both product lines contain consumervehicles, can be sold in the same way etc.
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Brand Development
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Brand development
• When it comes to brand development, there are
four main brand approaches, as shown in the
following diagram.
• As you can see, this diagram is a matrix built around
the two attributes of existing/new product category
and existing/new brand name. This then determines
one of the four boxes, namely:
Product line extension
Multi-brand
Brand extension
New brand
the top axis refers to the product category – that is, a
set of products – not an individual product.
Therefore, if Toyota was to introduce a new car, then
that would still be considered to be an existing
product, because they already offer and market cars.
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Brand development – Product line extension
1. PRODUCT LINE EXTENSION
• A product line extension is the use of an
established product brand name for a new item in
the same product category.
• Line extensions occur when a company
introduces additional items in the same
product category under the same brand name
such as new flavors, forms, colors, added
ingredients, package sizes.
The extension of the line typically takes on one of the following shapes:
1.
Multiplication of formats and sizes .
2.
Multiplication of the variety of tastes and flavours.
3.
Multiplication of the type of ingredients (for example Coca-Cola with or without sugar, with
or without caffeine, types of motors in the Ford Escort).
4.
Multiplication of physical forms such as Ariel in powder, liquid or micro formula.
5.
Multiplication of product add-ons under the same name, corresponding to a same
consumer need in what is called line extension. Eg. Ariel with Downy
6.
Multiplication of versions having a specific application. For example, Pledge, which was a
mono-product brand for wood polishing, turned into a range called Pledge ‘Classic’, which
offered variants for all types of surfaces
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Brand development – Product line extension
When a company rolls out a new product that carries slight
differences from its existing product lines, it is part of a
product line extension.
The objective of a product line extension is bringing in
customers who may not be familiar with the standard
product line.
Businesses with a successful product line in one arena can
employ a product line extension to meet new business
needs and profits
•
•
•
•
new geographic areas,
appeal to different audiences
meet specific price points
catering for new needs
Products in New Areas
Businesses can benefit from introducing
their successful products in new
geographic areas. When a product
meets the needs of customers in one
city or state, the company can extend
that product line to meet the needs of
customers in other states. For example,
Uber brand, when hit with success in
Cairo started rolling out in Alexandria
and other cities.
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Brand development – Product line extension
A product with new TA
A product line that shows that it meets the
needs of one group of customers often can
be extended to meet the same or similar
needs of another group. Unilever, the
company behind the popular Dove beauty
products for women, extended its product
line with "Dove For Men" skin care
products in an attempt to appeal to a
different demographic while maintaining
the trust that customers place in the Dove
brand name.
Products at New Price Points
Companies also can appeal to new
customers by producing similar products at
different price points. The product line
extension can be employed as either a
down-market stretch, where the new
product line appeals to bargain-minded
customers, or as an up-market stretch,
which appeals to luxury-minded shoppers.
A major example of this occurs in the
automotive industry, where manufacturers
have up-market product lines with brands
such as Nissan's Infiniti, Toyota's Lexus and
Honda's Acura.
Products for New Needs
• The biggest reason for a product line extension is
meeting customer needs that previous products
have not addressed.
• Laundry detergent manufacturers developed
product line extensions with detergents that
included additional scents, fabric softeners and
bleach. During the fitness craze of the 1970s, major
soft drink manufacturers developed diet drinks with
artificial sweeteners as a product line extension to
meet the needs of calorie-conscious consumers.
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Brand development –Multi Brand
2. MULTI BRAND
• A variation of the product line extension is to run a multiple brand strategy
within the same market. As you can see from the matrix, a multi-brand strategy
involves having more than one brand competing in the same product category.
• Again this is a relatively common approach for large companies. Like P&G and
Uniliver
• The main reasons for this is that these brands can have different positioning in
the market, dominate the overall shelf space, and reduce opportunities for
competitors to enter the market or to win market share.
• The disadvantage of this multi brand strategy (as opposed to a product line
extension strategy) is the cost and time of developing a new brand name
successfully in the marketplace.
• Example are Nescafé and Bonjorno from Nestle.
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Brand development –Multi Brand
• From the brand management perspective,
having multiple brands is a portfolio
strategy which can maintain the continuity
of profit-generating activities.
• A major example of this occurs in the
automotive industry, where manufacturers
have up-market product lines with brands
such as Nissan's Infiniti, Toyota's Lexus and
Honda's Acura.
• The BCG Matrix model is based on the two
indexes “current market share” and
“market growth potential”. The brand
portfolio of a company can be divided into
four quadrants with each part representing
a function. we will use this structure to
illustrate the multi-brands practices.
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BRAND DEVELOPMENT –
MULTI BRAND
BCG Matrix
• Cash cow: a “cash cow” brand possesses a large market
share, but its market growth potential is limited. In this
case, the reputation of the brand has been established
and the brand is profitable. The optimized choice is to
maximize the current revenue from the brand.
• Star: a “star” brand possesses a large market share, and
at the same time, its market growth potential is
promising. Like the name, this kind of brand is the star
of a company because it has high positioning and
generates high revenue. A “star” brand is a good
indicator of a company’s activities and profile. For
L’Oreal, Lancôme is the star because it occupies a
leading position in the premium cosmetics market.
• Dogs: “dogs” are brands lacking both market
share and growth potential. This kind of brand
is usually in the later stages of its brand-life,
and should be removed from the market as
soon as possible.
• Question mark or (Wildcats): a “wildcat”
brand has a small market share but good
growth potential; it has the potential to
become a “star” or a “dog”. To help the brand
become a star, the company should increase
advertising and promotional activities.
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Brand development –Multi Brand
• The BCG Matrix model expresses the dynamic process of a brand’s
life. Every brand has it own life: growth, maturity, aging and death. By
having multiple brands, the company can offset the negative effects of its
unprofitable brands.
• It is important to note that having a large brand portfolio is a strategy best
used by larger companies, as using this strategy means confronting higher
risks which a small company cannot bear. If the company’s brands in the
same market are not positioned clearly, competition between these
brands will only harm the company. Cost control is another key problem
here.
• Obviously, the more brands there are to manage, the higher the costs. For
this reason, many prudent companies prefer brand extension (extending a
brand from one market to another) over multi-brands management.
Advantages and Disadvantages of Multi Brand Strategy
• THE ADVANTAGES OF MULTI-BRANDING
• Leaving less shelf space for competitors and obtaining more for yourself.
• Effectively using brand-switchers, who love to experiment with different
brands.
• Competition between managers
• If the initial business succeeds, it can develop a second brand without
noticeable expenses, through the franchise.
• THE DISADVANTAGES/RISKS OF MULTI-BRANDING
• Cannibalization between brands.
• Confusion caused by overlapping segments, that will result in brand
switching.
• Failure due to poor management.
• Failure from wrong business choices.
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Brand development – Brand Extension
• Brand extension or brand stretching is a marketing
strategy in which a firm marketing a product with a welldeveloped image uses the same brand name in a
different product category.
• An example of this in recent years would be McDonald’s
competing in the gourmet coffee product category –
effectively broadening the positioning of McDonald’s from
fast food only to being perceived as also competing
against Starbucks to some extent.
• Brand extensions are usually approached with care, as the
market may not fully accept the brand’s expertise in
another product category. As a hypothetical example,
consider if the Coca-Cola brand was extended to
shampoos and detergents – the market would see little
connection and the overall brand would be damaged.
• Therefore, brand extensions work best if the new product
category has some relationship to the brand’s existing
product category and perceived area of expertise.
• But, all the brand extensions are not successful!
Sometime the new product doesn’t work, for many
different reasons. More often, the failure is due to
the fact that the product is too different, doesn't fit
with the brand image. There is no link with the
brand.
• the perfect example to illustrate a brand, which
made many brand extensions and had to face this
kind of failure: BIC
• BIC is a French company, at the beginning they
only sold stationery items (very diversified range),
then they started to commercialize lighters (1973)
and razors (1975), which were a great success for
the brand. But the things want wrong after that.
• By 1988, BIC tried to enter the market of
perfumery, selling small bottles of perfume in
tobacconists. It was a huge failure, mainly due to
the fact that the image of luxury and glamor,
related to perfumes didn’t fit with BIC’s brand
image and products (disposable, simple, cheap
products). The perfumes were withdrawn in 1991.
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Brand development –
Brand Extension
More recently, BIC tried another
brand extension, in 2008 they
launched the BIC Phone. It’s a
phone that costs 45€, and
contains 60 minutes of call,
which have to be used within 2
months. This product is available
in tobacconists, supermarkets,
airports… Just as the other BIC
products. But we don’t know yet
if it’s a success, but it really fit
with BIC brand image: simple
and practical.
Do you believe it will succeed or fail? Why?
Brand Extension
Failures
1
4
7
Colgate Frozen Dinners
• It’s almost impossible to talk about brand
extension failures without talking about
the Colgate frozen dinners.
• From vegetables and rice to beef lasagna,
the Colgate kitchen entrees were an
unmitigated disaster
• The biggest problem with this brand
extension attempt was that Colgate
ventured too far from its brand identity.
• It’s one thing to go from cooking shows
to cooking supplies, but the jump from
dental care to frozen dinner was too far.
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Brand development – Brand Extension
Types Of Brand Extension
• Companion Product Extension
• Companion products usually complement the original products.
They belong to the same niche and are generally directly related to
the original products. Examples include – Colgate, a toothpaste
brand, releasing a toothbrush under the same brand name.
• This is the most sought-after brand extension strategy as it also
helps in sales promotion and marketing the original product.
• Product Form Extension
• Product form extension includes launching the same product in a
different form, which results in it competing in a different product
category.
• Snickers used this brand extension type to launch Snickers ice
cream bars. Even though the product just changed its form, it
belonged to a different product category.
• Brand Prestige Extension
• Brand prestige extension refers to as extending the brand image to
a new product when it’s launched in a completely unrelated
product category. For example, BMW, a known automobile brand,
extended its brand prestige to the products it launched in the
apparel industry and accessories (watches).
• Extension By Leveraging A Lifestyle
• Some brands have successfully positioned
themselves as a part of a particular
lifestyle – they reinforce a way of living,
culture, or set of values or interests. They
are known as lifestyle brands.
• These lifestyle brands are known not for a
distinct benefit or component but a
distinct visual style that the customers can
emotionally relate to – like luxury, rugged
work ethic, or outdoor lifestyle. They use
this positioning strategy to expand their
range of offerings.
• Take jeep, for example, a well-known
automobile brand connected with an
outdoorsy lifestyle. The company used this
image as a base to extend its offerings to a
range of products which includes clothing,
knives, tents, bicycles, baby strollers, etc.
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Brand development – Brand Extension
Advantages And Disadvantages
Advantages Of Brand Extension
• Increases the operating market of the brand: With the introduction of a new product of a
different category under the same brand, the brand’s operating market increases. It makes
the brand visible to a broader audience, which eventually increases its brand equity.
• Increases the chances of accepting the brand’s new products: With increased
acquaintance with the existing brand, the willingness to try and accept its new products also
increases among the target audience, especially when the new products belong to the same
industry/niche.
• Enhances the brand image: When a new product launches with the same underlying brand
message and promise, the brand image improves, and customers start to believe in the
brand.
• Cost and effort of developing a new brand is saved: Developing a new brand incur
substantial charges which aren’t limited to marketing and promotion. Brand extension saves
such costs and even benefits the company in cutting marketing and promotion costs as the
same communication channels that were used earlier can be used to promote both the
products.
• Makes getting initial traction easy: It is usually easier to attract the existing customers of
the brand or people who are acquainted with the brand to try the new products launched by
the company under the same brand.
Disadvantages Of Brand Extension
• Can lead to brand dilution: Brand dilution is the weakening of the power of the brand
because of its overuse. It happens when the company uses the brand extension strategy in
almost every industry it wants to enter into without considering the logical relationship
between the existing and new products. This often confuses the customer about what the
brand stands for and what to expect from it.
• Can damage the existing brand image: If the spin-off can’t stand up to the expectations of
the target market or if its positioning strategy backfires, the existing brand image is affected.
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Brand development – New Brand
}
Product line extension
}
Multi-brand
}
Brand extension
}
New brand
• A new brand occurs when the
firm is expanding its offering –
by developing a new product
line that they haven’t offered
before – and as a result, need
to build a new brand.
New Brands – When?
• The power of existing brand names is waning.
• Also, a new brand name is appropriate when the company enters a new
product category for which none of its current brand names are appropriate.
• A company grows through its new products: they make it possible to gain a
differential in products and services over the competition.
• They also make it possible to focus advertising on news that will interest the
market.
New Brands - rules
• No new brand to be launched without a major, long-term advertising
investment. Otherwise, the product will appear on shelves or in catalogues,
with a mysterious name, and the customer will be unable to grasp what the
new product has to offer.
• The second question concerns the future: will this daughter brand be able to
provide an umbrella for other products? Will it be possible to put other
future products under Nescafe by Nestle , for example, that will be coherent
with this name? This criterion is essential and too rarely used: if it is not
respected, the company plunges ahead into an economic impasse. In fact, it
is difficult to support a single product in advertising and communication.
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Let’s
exercise
True or False
Brand architecture is the structure of brands within an organizational entity. It is the way in which
the brands within a company's portfolio are related to, and differentiated from, one another.
The Length of the mix refers to the number of product lines the company has to offer.
Fedex name is always present and linked to the extensions. This strategy is called “house of
brands”.
A product line extension is the use of an established product brand name for a new item in
the same product category.
Product line extension can help getting consumers whom were not interested in the main
product line.
A multi-brand strategy involves having more than one brand competing in the same product
category.
Developing a brand extension is less costly than developing a line extension.
A “star” brand possesses a large market share, and at the same time, its market growth
potential is promising. .
the BCG matrix is developed once at the launch of a new brand and stays the same and is used as
a benchmark to monitor the brand’s growth.
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CHAPTER 6
MARKET
EXPANSIONS
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Market Expansions
The Ansoff matrix
• The Ansoff Matrix, often called the Product/Market Expansion
Grid, is a two-by-two framework used by management teams to
help plan and evaluate growth initiatives. In particular, the tool
helps stakeholders conceptualize the level of risk associated with
different growth strategies.
Each box of the Matrix corresponds to a specific growth strategy.
They are:
1. Market Penetration – The concept of increasing sales
of existing products into an existing market
2. Market Development – Focuses on selling existing products
into new markets
3. Product Development – Focuses on introducing new products
to an existing market
4. Diversification – The concept of entering a new market with
altogether new products
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Market Expansions
The Ansoff matrix – Market penetration
Market Penetration – The concept of increasing sales of existing products into
an existing market
• The least risky, in relative terms, is market penetration
When employing a market penetration strategy, management seeks to sell more of its
existing products into markets that they’re familiar with and where they have existing
relationships. Typical execution strategies include:
• Increasing marketing efforts or streamlining distribution processes
• Decreasing prices to attract new customers within the market segment
• Acquiring a competitor in the same market
Consider a consumer packaged goods business that sells into grocery chains.
Management may seek greater penetration by amending pricing for a large chain in order
to secure incremental shelf space not just for packaged food products but also for several
lines of its pet food products, too.
• Brands such as Coca-Cola and Heineken are
known for spending a lot on marketing in order
to penetrate their markets. In addition, they try
to maximize the use of distribution channels by
making attractive deals with a large variety of
distributors such as supermarkets, restaurants,
bars and football stadiums for example.
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Market Expansions
The Ansoff matrix – Market Development
Market Development is about selling more of the company’s existing products to new
markets
A market development strategy is the next least risky because it does not require
significant investment in R&D or product development. Rather, it allows a management
team to leverage existing products and take them to a different market. Approaches
include:
• Catering to a different customer segment or target demographic
• Entering a new domestic market (regional expansion)
• Entering into a foreign market (international expansion)
An example is LG home appliances; management made a decision to aggressively expand
into the Middle East market to sell its already very popular products. While building an
advertising and logistics infrastructure in a foreign market inherently presents risks, it’s
made less risky by virtue of the fact that they’re selling a product with a proven roadmap.
• This is what for example IKEA has done over the past few
decades in order to become one of the biggest furniture
retailers in the world. IKEA started off expanding to markets
relatively close in terms of culture as to its home country
(Sweden) before targeting more challenging geographic
areas such as China and the Middle-East.
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Market Expansions
The Ansoff matrix – Product Development
Product Development – Focuses on introducing new products to an existing market
A business that firmly has the ears of a particular market or target audience may look to
expand its share of wallet from that customer base. Think of it as a play on brand loyalty,
which may be achieved in a variety of ways, including:
• Investing in R&D to develop an altogether new product(s).
• Acquiring the rights to produce and sell another firm’s product(s).
• Creating a new offering by branding a white-label product that’s actually produced by a
third party.
An example might be a beauty brand that produces and sells hair care products that are
popular among women aged 28-35. In an effort to capitalize on the brand’s popularity and
loyalty with this demographic, they invest heavily in the production of a new line of different
hair care or beauty care products, hoping that the existing target market will adopt it.
• Companies could for example make some modifications in the existing
products to give increased value to the customers for their purchase or
develop and launch new products alongside a company’s existing product
offering.
• A classic example of product development is Apple launching a brand new iPhone every
few years. Other examples can be found in the pharmaceutical industry where
companies such as Pfizer, Merck and Bayer are heavily investing in Research and
Development (R&D) in order to come up with innovative drugs every now and then.
• Automotive companies are creating electric cars to meet the changing needs of their
existing market.
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Market Expansions
The Ansoff matrix – Diversification
Diversification – The concept of entering a new market with altogether new products
• In relative terms, a diversification strategy is generally the highest risk endeavor; after all,
both product development and market development are required. While it is the highest
risk strategy, it can reap huge rewards – either by achieving altogether new revenue
opportunities or by reducing a firm’s reliance on a single product/market .
There are generally two types of diversification strategies
1. Related Diversification – Where there are potential synergies that can be realized between the
existing business and the new product/market.
• An example is a producer of leather shoes that decides to produce leather car seats. There are
almost certainly synergies to be had in sourcing raw materials, although the product itself and the
production process will require considerable investment in R&D and production.
2. Unrelated Diversification – Where it’s unlikely that any real synergies will be realized between the
existing business and the new product/market.
• Let’s work on the leather shoe producer example again. Consider if management wanted to reduce
its overall reliance on the (highly cyclical) consumer discretionary high-end shoe business, they
might invest heavily in a consumer packaged goods product in order to diversify.
• A great example of a diversification both related and
unrelated is Samsung, which is operating in businesses
varying from computers, phones and refrigerators to
chemicals, insurances and hotel chains.
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Let’s
exercise
Which of the four strategies in the Ansoff Matrix is generally thought to involve the highest risk?
•
•
•
•
product development
market penetration
market development
diversification
The four components of the Ansoff Matrix are:
a. Market orientation, product orientation, market development, product development
b. Market orientation, product orientation, market penetration, product development
c. Market penetration, market development, product penetration, product development
d. Market penetration, market development, product development, diversification
A significant increase in market share would
be evidence of a successful strategy of
• Product development
• Market development
• Diversification
• Market penetration
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Let’s
exercise
The launch by Apple of its first wearable
device – the i-watch, is an example of:
• Market Penetration
• Product development
• Diversification
• Market Development
Sarah wants to start offering Sushi in her restaurant where she used to offer Salads only, to attract the sushi lovers.
Which of these strategies is she considering?
1.Expansion
2.Market development
3.Market penetration
4. Product development
According to Ansoff’s matrix, a company that tries to increase sales by selling its existing products in a new market
is following what kind of strategy?
1.market development
2.diversification
3.focus
4.market penetration
5.product development
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Chapter 7
Analyzing
the
competition
Porter’s competitive Forces
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The 5 Forces of
Porter
• Porter's Five Forces are five separate threat
factors that can impact business growth.
•
Porter’s Five Forces is one of the most
traditional, well-known, and most widely
used strategic macro analysis models. Used
in conjunction with a PESTLE analysis, it helps
you understand the competitive forces at
work in an industry and how they affect
the profitability of your business.
What Are Porter’s Five Forces?
Competitive rivalry
Threat of new entrants
Threat of substitutes
Power of suppliers
Power of buyers
What is the use of Porter’s 5 forces?
1. Assessing the long-term profit potential of an industry
2. Evaluate the root causes of profitability
3. It is an external assessment framework which helps in understanding
the potential of a business in a certain market
4. When the competitive forces are high or intense it is an indication
that the profitability potential will decrease.
5. Based on all above, it is a guiding tool for the future development of
the business
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Competitive Rivalry
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The 5 Forces of Porter
1. Competitive Rivalry
Rivalry is high when
1. Number and size of existing competitors
• A multitude of competitors
• Similar in size and power
2. Industry growth rate
• Slow industry growth
3. Product differentiation between rivals
• Not much differentiation
4. Exit barriers forcing industries to remain in the market even with
lowering profits
• When rivalry is high companies are more likely to engage in price wars
Cost
Profit
Margin
Lowering the
prices
Or spending
more on
advertising
hence raising
the cost
In both cases
decreasing the
profit margin
Price
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The 5 Forces of Porter
1. Competitive Rivalry
Rivalry in the airline industry
• We realize that the industry is
very competitive due to the high
number of players
• Stagnant growth
• High fixed costs result into high
barriers to exit
• In addition, many players in the
competition are similar in size
which adds up to the
competitive intensity
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Threats of new entrants
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The 5 Forces of Porter
2. Threats of new Entrants
• New entrance in any market bring in a new
capacity to gain market share from existing
plyers within a market which puts pressure
on prices, costs and investments in order
to remain into the competition
• Simply said, you will have to share the pie
with more players
• The seriousness of the threat depends on
the barriers of entry in a certain business
• The higher these barriers the lower is the
chance that new players will enter the
field, and the smaller the threat for
existing rivals
The market
Examples of entry barriers
• Economies of scale
• Customers loyalty for existing brands
• Capital of investment required
• Government policies
• Access to distribution channels
In order to prevent new competitors from
entering, they can lower prices in order to
scare off new competitors
Again, this will decrease the profit margin.
Existing players might need to increase their
investments in product development or
marketing in order to stay ahead of the game
this will increase cost and lower the profit
margin
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Cost
Profit
Margin
Price
166
The 5 Forces of Porter
2. Threats of new Entrants
Example of the airline industry
The threat of new entrants is considered medium, the main barriers are:
• Flight routes
• Licenses
• Insurances
• Distribution channels
these qualifications are not easy to obtain when you are not in the industry
• Yet due to the leasing options and financing of banks to the different
industries new doors are opened for potential entrants
• Over the last few year, many low cost air lines like Ryan air and EasyJet
have successfully entered the market introducing innovative cost cutting
business models that are shaping the industry hereby shaking up existing
players like Lufthansa, American airlines, Air France and KLM
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Threat of Substitutes
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The 5 Forces of Porter
3. Threats of Substitutes
• A substitute is a product that performs the same function of an industry
product by a different means
• they basically fulfill the same underlying need yet they do not look the
same on the surface which makes them unnoticeable
• The problem with these products is that customers can switch to them so
you should look beyond similar products that are branded differently by
competitors
• Example, energy drinks like red bull are not usually considered competitive
to coffee drinks like Nespresso or Starbucks however since both coffee and
energy drinks fulfill a similar need of staying awake or getting energy,
customers might easily switch from one to another if they feel for example
that one m is overpriced
Factors determining the
total threat of substitutes
products
•
The number of substitutes
•
The buyer's willingness to substitute
•
The price performance trade off
Accordingly, companies needs to make sure
to keep their products attractive enough
and not turn into obsolete products
Again, they can lower the prices which will decrease the
profit margin, or invest in advertising or product
development to give customers an incentive to stay, which
again in turn will decrease the profit
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The 5 Forces of Porter
3. Threats of Substitutes
The threat of substitutes in
the airline business
• The general need of customers is to travel, so they always look for alternatives
• Trains, busses and Cars
• In Asia travelling by high speed train is very common and increasing, the same
trend is growing in Europe, and the industry is facing a serious competition
from the Hyperloop threat
• Hyperloop is a new form of ground transport currently in development by a
number of companies, It could see passengers travelling at over 700 miles an
hour in floating pod which races along inside giant low-pressure tubes, either
above or below ground.
So we can say that the threat is Medium to High
Hyperloop
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The bargaining power
of suppliers
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The 5 Forces of Porter
4. The bargaining Power
of Suppliers
This force analyses how much power and control companies’ supplier has
over the potential to raise its prices or to reduce its quality of purchased
goods or services which in turns would lower an industries profitability
potential
• The number and concentration of suppliers plays a role in this area. The
more the number of suppliers the less their power
Also the power of suppliers is affected by:
• The switching cost
• Available substitutes
• Strength of their distribution channels
• Uniqueness of the supplier’s products
Let's say your business idea was to manufacture electronic devices. You'd have
to assess your supply options for a range of specialist components. If one
supplier dominated the components market, then they could raise their prices
without worrying about their own competitors. This might affect the viability of
your product.
Volkswagen Group's suppliers have limited bargaining power due to VW's
global presence with suppliers scattered around the globe. On top of that,
Volkswagen has at least 1 or 2 backup suppliers for each part and can shift
demand between them.
On the contrary, many automotive suppliers manufacture only a specific part
and are heavily dependent on the industry. These dynamics of the automotive
industry put Volkswagen in a superior position while its suppliers have relatively
low bargaining power.
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The 5 Forces of Porter
4. The bargaining Power
of Suppliers
Supplier's bargaining power
in the airline industry
The bargaining power in the airline business is considered very high
• The airline industry is heavily dependent on fuel and aircrafts, these are
external factors over which the airline itself has little control
• The price for aviation fuel is subject to the fluctuation of oil prices in the
global market
• In terms of aircrafts, only 2 major suppliers exist Boeing and Airbus
accordingly these 2 companies have a substantial bargaining power over
the prices they charge
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The bargaining power
of buyers
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The 5 Forces of Porter
4. The bargaining Power
of Buyers
• This force analyses to what extent customers are able to put a company
under pressure by demanding better quality hence increasing cost or in
decreasing price
We have to keep in mind that buyers are not always the end consumers , if it is
a manufacturing company for examples buyers can be retailers for example
• Buying power is high when there are a lot of suppliers to choose from
• Also when it is easy for them to switch from one company to another
• Buying power is low however when customers buy products in small
amounts, and when the seller's product is very different from any of its
competitors
• The internet has allowed customers to be more informed, and hence more
empowered as customers can easily compare prices online and get
information about a large variety of products and get offers from a lot of
companies instantly
Companies can take measures to reduce buyers' power by introducing for
instance loyalty programs or by differentiating their products or services.
The bargaining
power of
buyers in the
airline industry
• The bargaining powers of customers in the airline industry are high.
• Customers can check prices and compare with all offers through the
many online sites offering comparisons and alternatives like sky
scanner and expedia
• In addition, there is no switching cost involved in that process, so loyalty
is not very high
• Some airlines are trying to change that through frequent flyers
programs
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The 5 Forces of Porter
In conclusion…
• Companies use Porter’s 5 Forces to assess competitors of
existing product lines, adjust their competitive strategy
accordingly, explore new product ideas, and evaluate
investment opportunities.
• If you’re wondering why you should put so much effort
into researching your competition in the first place, then
you should know that 19% of failed startups specifically
fail because they get outcompeted.
• And the easiest way to let your competitors win is not
knowing where you stand in an industry or marketplace.
You can’t understand the long-term prospects of a
product or service without knowing your current and
future competition.
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Chapter 8
Global marketing
strategies
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Global marketing strategies
• Global marketing is the act of focusing a product on the needs of potential
buyers in other countries.
• Knowing who needs your product, what form they need it in, and how to
market it in a way that strengthens the brand are core ingredients of good
global marketing strategy.
• Typically, a global marketing strategy requires a business to do new market
research, identify countries where the business's product might be
successful, and then localize the brand to reflect the needs of those
communities. However, localization is not always necessary. Some brands
adopt a global standardization strategy instead.
There are 2 types of global marketing strategies
Businesses that expand globally
need to decide how they’ll
approach marketing to their new
customers.
• A standardization strategy
delivers a uniform message and
consistent content across
markets.
• Localization takes the opposite
approach—tailoring strategies,
campaigns, and resources at
the local level.
Both of these strategies offer
advantages, but some companies
may benefit more from one
approach over the other,
depending on the type of business,
size of the organization, and
globalization goals.
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Global marketing strategies
1. Standardization: Keeping things consistent across international markets
(global integration)
• With a global standardization strategy, a company is assured that its
products and the way they are marketed are largely the same everywhere
around the world, across countries, cultures, and platforms. The ultimate
goal is to create a universal experience of the brand while also reducing
costs and complexity.
2. Localization (local responsiveness)
• Localization is a strategy of considering each market individually. When
marketing content is localized, every aspect of the communication is
tailored to resonate with the local audience: message, language, tone,
colors, images, and cultural elements. It takes into account not just the
language that is spoken, but also customs, belief systems, and cultures.
• Some countries will resonate with one thing while other countries won’t.
For example, yellow is a bright and positive colour in America and the UK
but in France they associate yellow with jealousy, betrayal, weakness, and
contradiction. In the 10th century, the French painted the doors of traitors
and criminals yellow.
• Translation isn’t enough. Your market needs localization if you want to truly
adapt to it.
The formula…….
Balancing standardization and localization
• In the end, it may not be necessary to choose a single marketing strategy,
global standardization vs localization. In fact, a balanced approach that blends
the advantages of each could give your company the best of both worlds. To
get started, your business will need to assess which elements to keep
consistent across countries and which to adapt for local markets.
• There’s no “right” way to expand your business internationally. And variations
between the 2 models are important to consider. We’re walking through the
four most common international business strategies companies use,
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Global marketing strategies
Expanding internationally model
There are four different common strategies businesses use to expand
internationally:
1. International strategy (Export)
2. Multidomestic strategy (localization)
3. Global strategy (standardization)
4. Transnational strategy
• Consider each of these strategies on a spectrum between two elements: local responsiveness
and global integration.
• Local responsiveness refers to how companies serve a specific market’s needs — essentially, how
much do they change from market to market? This isn’t just about translating the website or
mobile app into a different language, but about the entire customer experience, from payment
processes to imagery and product choices or specifications.
• Global integration, on the other hand, refers to the standardization companies achieve as they
scale. Brands that prioritize global integration have little to no differences between various
countries.
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Global marketing strategies
International strategy
• A successful international strategy focuses on a single
point of operation while exporting products and
services around the world. As such, it ranks low on
both global integration and local responsiveness.
• An international strategy is often the first strategy
companies use when they expand to secondary
markets, and that’s because it’s the most accessible of
the four. It’s essentially an extension of your domestic
strategy, operating with a central or head office in your
home market and exporting your products to target
markets.
• The major advantage of this approach is that it’s a
quick way to test out the global appeal of your product
without making significant investments in
infrastructure or staffing in other markets.
Advantages and disadvantages of
International Strategy
Advantages
• Build a standardized, immediately recognizable brand
• Consolidate management processes and lower costs
• Simplify your product portfolio based on what performs well globally
• If you’re unsure how your products will respond to different markets or just want to test it
out, following the export model is a safe option. However, an international strategy does
have its drawbacks, which is why many companies use an international strategy to start
with before moving to one of the other three strategies.
Disadvantages
• With an export-driven strategy, you’re stuck paying higher taxes and tariffs every time you
export,
• it can be challenging to coordinate supply chains and customer service with only offices in
your home market.
• Your customers still need to be able to understand what you offer and how to pay for it
regardless of the level of global integration you’re pursuing.
Regardless of these challenges, an international strategy is by far the most popular for
businesses, especially as they take their first steps toward globalization and international
expansion to different countries.
The other most popular type of business that employs this strategy is regional or luxury
brands where the location of origin matters. Think about some of the most iconic food
and drink in the world — champagne from France or caviar from Russia:
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Global marketing strategies
International strategy
Examples
1. Moet & Chandon: The iconic champagne has been on the market since
1842 (Napoleon himself was a fan). Now, it remains one of the most
popular choices in a $700 million market, boasting a celebrity-packed
history from Napoleon to the Oscars. Every bottle is grown, produced, and
shipped from 2,000 acres of vineyards across 200 crus in France.
2. Red Bull: Austrian company Red Bull started as a small exporting
manufacturer in 1987 when their team hit on a brilliant global marketing
strategy: giving out free samples to adrenaline junkies in the United States
at skateboarding and mountain biking exhibitions. Today’s model is more
transnational in nature.
3. Victoria’s Secret: Though the global brand — and ever-present 2000s
lingerie chain — has manufacturers from around the world, the company
relies primarily on an export model and opening stores in smaller locations
like malls and airports as their point of entry with no changes in sizes or
styles for women anywhere in the world looking to figure out “the secret.”
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Global marketing strategies
Multidomestic strategy
The most local responsiveness
• A multi-domestic strategy ranks high on local responsiveness and
low on global integration, making it the “local-first” approach of
the four strategies.
• Companies that employ a multi-domestic strategy change their
product, messaging, go-to-market, and customer support (among
other things) based on each market they enter.
• The greatest advantage to this is a highly specialized, localized
product that directly matches customer tastes and preferences,
with employees on the ground in that market that understand the
cultural nuances. Choosing this strategy allows you to:
• Easily access local competitive advantages, such as labor, shipping
lanes, and natural resources
• Gain a stronger foothold in a local market more quickly
• Essentially, multidomestic companies operate with one overarching parent
company and a selection of separate companies within each country
• This model doesn’t come without challenges, however, as the success of
each “domestic” unit requires a deep understanding of that market and
resources to spin up completely separate operations in that market. You
may have duplicate efforts and siloes across each company, and
fundamentally changing your offerings every time you enter a new market
can take a lot of up-front time and resources. And with a multi-domestic
approach, a strong localization program is the most crucial element
• Done right, multi-domestic companies can be very successful. In fact, some
of the most successful food, wellness, retail, and beverage companies in the
world operate this way:
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Global marketing strategies
Multidomestic strategy
Examples of multidomestic strategy
• Johnson & Johnson: Band-Aids, Neutrogena,
Splenda, and Tylenol all fall under the Johnson &
Johnson umbrella. Operating hundreds of brands in
over 60 countries, they’re a household name all
over the world.
• Procter & Gamble: Billion-dollar brands like
Pampers, Downy, Gillette, Always, and Olay are
owned by Procter & Gamble. Their portfolio of
over 250 brands operates in 140 countries.
• Nestlé: Gerber, Purina, Perrier, Lean Cuisine,
Haagen-Dazs, and Toll House are all owned by
Swiss-owned candy company Nestlé as part of their
portfolio of more than 2000 companies in the food
and beverage space. They sell in over 186
countries, each with its selection of brands curated
to match local preferences.
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Global marketing strategies
Global strategy
The most global integration:
• This approach focuses on
standardization as much as possible,
including colors, messaging, products,
and operations, so they can build
repeatable, scalable processes no
matter which foreign market they
operate in. That means having one
brand, one suite of products, and one
message from a central headquarters.
• The advantage of this is that pursuing
this strategy gives you an instantly
recognizable global brand with a stepby-step path toward global market
penetration. Choosing this strategy
allows you to:
• Harness economies of scale with
efficient processes and operations
• Streamline product development with
one product line and minimal changes
by market
• However, the greatest challenge with global strategy is knowing how much
standardization to pursue. Even top global brands still invest in some level of
localization and adaptation to local markets — just not so much that it
infringes on their scale and efficiency. You should expect to invest in a solid
localization process so that your customers can interact with your website,
mobile app, packaging, and more in their home language.
• Because this model requires a strong global presence to start with, it’s often
the end-game for international businesses, moving through the other models
before achieving a truly global brand. As a company, you’re taking a gamble
that your product has so much universal appeal that it will create demand
regardless of market tastes and preferences — which is also why so few
companies truly achieve this status:
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Global marketing strategies
Global strategy
Examples of global strategy
• Amazon: One of the largest companies in the
world, Amazon operates in 58 countries and
reaches more than a billion people online every
day. The leading e-commerce company in almost
every country , you can see Amazon’s ever-present
“smile” on trucks and packages — and enjoy sameday shipping — pretty much everywhere.
• Apple: Since releasing the original Mac in 1984,
Apple rose to dominance for its sleek lines, clean
interface, and easy-to-use software. Globally,
Apple’s technology is the same (with a few minor
changes) wherever you go. Considered one of the
biggest global brands today, Apple operates in over
175 countries around the world with more than
100,000 employees.
• Disney: It’s a small world, after all. Whether you’re
visiting parks in Shanghai or California, you’ll be
able to experience the same magic. For movies,
merchandise, and TV shows, Disney’s team works
to make sure it’s as globally inclusive as possible
with only minor changes if needed based on
audience feedback (eg, for the title of a film.)
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Global marketing strategies
Transnational strategy
The best of both:
• While a global strategy may seem like
the end-game, for many brands, the best
choice is a transnational strategy, which
splits the difference in terms of local
responsiveness and global integration.
• Transnational businesses operate with a
central or head office in one country
(the global integration part) and also
employ local subsidiaries in international
markets (the local responsiveness part).
. Choosing this strategy allows you to:
• Create a standardized brand that’s
immediately recognizable but
accommodate differences in market
preferences
• Centralize and streamline operations,
getting the advantage from economies
of scale
• Be able to flex between a high-level
strategic overview of investments
without losing customer-centricity with
local markets
• Of the four models, transnational has the most variation. Some
businesses give more autonomy to their local branches than others.
• Balancing corporate decisions vs. local decisions remains one of the
biggest challenges for global companies.
• Keeping local customers in mind, rather than just selling to foreign
markets, is what makes transnational strategies so successful, like
these companies:
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Global marketing strategies
Transnational strategy
Examples of transnational strategy
• McDonald’s has a global scale with 36,000 fast food locations in more than
100 different countries worldwide. They adapt their menu and prices based
on the market, from a McSpicy Paneer in India (fried paneer cheese, tandoori
sauce, and lettuce) or poutine (french fries with gravy) in Canada.
• Nike sneakers and sports apparel can be found in over 170 countries, but they
change their network of influential sports celebrities and marketing strategy
based on the market. Depending on what sports matter, you can hear from
soccer phenom Cristiano Ronaldo to basketball star LeBron James and tennis
champion Rafael Nadal.
• Coca-Cola’s localization approach means you can order a “Coke,” a “Cola,” or
a “Coca” (which have a slightly different formula) depending on the market.
What makes this work across their 200+ countries is universal marketing
messages of happiness, enjoyment, and sharing. Combining this
standardization with variations in local flavors and packaging makes them
successful.
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EXAMPLES
189
Example of communication
localization
• Ad localization is a process to adapt the copy, design,
and layout of national ads for a local audience. But it
isn’t a novel idea; just one that’s seen renewed
interest since Apple’s ATT update rolled out. And it
will be in the limelight even more so once Google’s
inevitable plan to phase out third-party cookies in
2023 comes to pass.
• Coca-Cola’s “Share a Coke” campaign is a brilliant
example of localization. In the US, the bottles said
Share a Coke with John or Sarah or Bobby. In Ireland,
they chose Irish names like Aoife and Oisín. But the
best example came from China where they used
terms like “classmate” or “close friend” because it’s
impolite to address anyone by their first name.
Example of communication localization
Coca-Cola USA
Coca-Cola India
Coca-Cola Egypt
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Example on communication and product
offering localization
Samsung
• Samsung wasn’t in the French market until 2010, competitors such as Apple,
Sony, and Nokia dominated. But when Samsung decided they wanted to
feature more prominently in the French market, they pierced it with an
ingenious strategy. To appeal to the French people’s love of artistic integrity,
Samsung arranged an art exhibition. They held it at the Petit Palais in Paris.
But this wasn’t your run of the mill art exhibition. Samsung displayed works
of art in high definition on their new TV sets. In its first month, the exhibition
had 600,000 visitors. Couple this with their focus on promoting locally made
apps, France now has a sense of ownership of Samsung.
• Samsung is a South Korean company, and in fact not at all French. If Samsung
had just translated their marketing materials and distributed them in France,
they wouldn’t have even gotten close to this success. But they applied
localisation to their brand. They utilised their love and appreciation of art,
making Samsung feel at home in France.
Paris, France, June 24th, 2021 – The International news channel
France 24 is now available on Samsung smart TVs.
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Product offering localization
• Nike's “Nike by You” co-creation platform serves as another
strategy that the company is using to appeal to international
markets. By putting the power of design into the hands of the
consumer, Nike is able to deliver customized products that
align with different cultural preferences and styles.
We all know McDonald's is a successful global brand.
While keeping its overarching branding consistent,
McDonald's practices "glocal" marketing efforts. No, that's
not a typo. McDonald's brings a local flavor to different
countries with region-specific menu items. For instance,
McDonald's offers the McArabia, a flatbread sandwich, in its
restaurants in the Middle East.
McDonalds Italy
McDonalds France
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Chapter 9
Monitoring brand
Performance
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What is brand performance
Product vs Brand life cycle
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Brand Life
Cycle
1. Introductory stage
This stage is characterized by a low growth rate of sales as the brand is newly launched and
consumers may not know much about it. Traditionally, a company usually incurs losses rather than
profits during this phase. Especially if the product is new on the market, users may not be aware of
its true potential, necessitating widespread information and advertising campaigns through
various media.
Characteristics of the introduction stage are:
•High costs due to initial marketing, advertising, distribution and so on.
•Sales volumes are low, increasing slowly
•There may be little to no competition
•Demand must be created through promotion and awareness campaigns
•Customers must be prompted to try the brand.
•Little or no profit is made owing to high costs and low sales volumes
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Brand Life
Cycle
2. Growth
The growth stage is the period during which the brand eventually and increasingly gains acceptance
among consumers, the industry, and the wider general public. And as a result sales and revenues
start to increase. Profits begin to be generated, though the break even point is likely to remain
unbreached for a significant time–even until the next stage, depending on the cost and revenue
structures.
Initial distribution is expanded further as demand starts to rise. Promotion is increased beyond the
initially high levels, and word-of-mouth advertising leads to more and more potential customers
hearing about the product, trying it out, and–if the company is lucky–choosing to use the brand
regularly. Repeat orders from initial buyers are also obtained.
the growth stage is seen as the best time to introduce product innovations, as it creates a
positive image of the product and diminishes the presence of competitors who will be
attempting to copy or improve the product and present their own products as a substitute.
Characteristics of the growth stage:
• Costs reduced due to economies of scale: as production and distribution are ramped up,
economies of scale kick in and reduce the per unit costs.
• Sales volume increases significantly: as the product increases in popularity, sales volumes
increase.
• Profitability begins to rise: revenues begin to exceed costs, creating profit for the company
• Public awareness increases: through increased promotion, visibility and word of mouth, public
awareness grows.
• Competition begins to increase with a few new players in establishing market
• Increased competition leads to price decreases: price wars may erupt, technology may get
cheaper, or other factors can ultimately lead to falling prices.
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Brand Life
Cycle
During this stage, sales growth has started to slow down, and the product has already reached
widespread acceptance in the market, in relative terms. Demand for the product ultimately
decreases due to competition and market saturation, as well as new technologies and changes in
consumer tastes. Actions the company takes may include:
•Improving specific features in order to resell the product (for instance, in the case of a car,
the manufacturer may include alloy wheels, new colors, sport or hybrid versions, or other
changes in order to keep sales going);
•Lowering prices in order to fight off competition;
•Intensifying distribution and promotional efforts;
•Differentiation efforts, in the hope that new customers will start to buy the brand.
•Finding a new targeted market.
The stage that lasts the longest in the product life cycle is the Maturity stage. It is at this time
that repeat business and purchases take the place of new customer buying. So, during the
maturity stage, the following occurs:
Characteristics of the maturity phase
•Costs are lowered as a result of production volumes increasing and experience curve
effects
•Sales volume peaks and market saturation is reached
•Increase in numbers of competitors entering the market
•Prices tend to drop due to the proliferation of competing products
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Decline
Profitability will fall, eventually to the point where it is no longer profitable to produce, and
production will stop. As a number of companies start to dominate the market, it becomes
increasingly difficult for the company in question to maintain its level of sales. Consumer tastes
also change, as do new technologies which may make the product become ultimately obsolete.
Features of the decline stage include:
•A decline in sales volume as competition becomes severe, and popularity of the product
falls;
•A fall in prices and profitability (the latter ultimately moving in the negative zone);
•A counter-optimal cost structure;
•Profit increasingly becomes a challenge of production/distribution efficiency rather than
increased sales.
It is important to note that product termination is not usually the end of the business
cycle; rather, it is only the end of a single entrant within the larger scope of an on-going
business program.
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Brand performance can be defined by the extent to which
a product or service meets customer’s needs and
expectations. Brand performance is often influenced by
the transformation of a product’s key constituents and
characteristics that define and differentiate the brand.
Most often the strongest of brands rely their performance
on a strong market positioning with the help of a unique
selling proposition or USP. There are a few other
contributing factors towards brand performance such as:
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• The major and supplementary features of your product
or service.
• The reliability and durability of your product or service.
• Effectiveness and efficiency of the product or service.
Pitch deck title
appeal and design features. 199
• Visual
• Price and value for money.
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Monitoring and
Measuring brand
performance
Pitch deck title
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Why Do You Need Brand Monitoring?
Monitoring your brand allows you to:
•Better understand your target audience: you can find out what social
media platforms and websites they use, what languages they speak,
where they live, etc.
•Realize what your brand’s strengths and weaknesses are. When doing
brand monitoring you can find customers’ complaints and requests
and figure out how to improve your product.
•Safeguard your brand reputation against a PR crisis. By quickly finding
negative mentions of your brand you can deal with them right away
before they turn into a social media crisis.
•Find marketing opportunities: find new platforms, backlink
opportunities, and communities to market to.
•Discover influencers who want to collaborate with you.
Measuring Brand Performance Across Your Online
Channels
You can measure your brand performance by tracking how well your brand is
growing on social media. What people like, share, comment on, and subscribe to
provides insights into how your brand is performing.
Audience growth
Audience growth refers to how many followers you have on your social media
channels and the number of website visitors you get. You can track these on a
monthly basis to see how your brand is performing.
Audience interactions
Audience interactions refer to the number of views, likes, retweets, shares, and
comments you get on your social media and blog posts.
Measuring Brand Performance Along the Buyer
Journey
Measuring brand performance is not only about the number of social interactions
and the number of visitors to your website. It also involves evaluating how
potential customers move through your buyer journey.
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1. Brand Awareness
The first key performance indicator is to judge the amount of brand awareness amidst your
target market. You can understand this by cross-checking with your customer database as to
how many people who have purchased your product or service recognize your brand and
return to your place of business. The key performance indicators you can use are
• Understand your brand’s impression and market position among your existing
customers.
• Organic mentions of your brand in posts or blogs by non-customers.
• Mentions or recommendations by customers.
You can measure brand awareness with the
right tools and metrics.
• Top-of-mind brand awareness: is
your brand the first one customers
recall in a specific product category?
Diapers = Pampers.
• Unaided brand awareness: can your
target audience name your brand
among others without any prompts?
Popular sneakers = Nike, Adidas,
Puma.
• Aided brand awareness: is your
target audience familiar with your
brand at all e.g. do you know the
following ride-hailing companies —
Uber, Lyft, Bolt, Via, Didi?
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Pitch deck title
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2. Brand Familiarity
You need to determine how many people who are familiar with your brand understand what
your brand stands for. The key indicators are:
• How much do your customers know about your brand and its products or services?
• Do they identify your market positioning?
The two indicators to measure the familiarity of your brand are:
• Your customer’s rate of return to your business or its website.
• Time spent by your customer at your business or its website.
• Engagement rate on your social media platforms
Engagement rate
Once you establish your marketing strategy and start posting your content on a regular basis,
you need to measure the engagement around it.
There are different type of engagement and social media algorithms assign different value to
likes, comments, or shares.
Brand engagement will indicate how well your message resonates with your audience. The
more popular your content is, the more interactions you’ll receive. And the likes and
comments translate directly into the position of your posts on different social media
platforms. The higher the content ranks, the better chance more people will see the post.
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Pitch deck title
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3. Purchasing Intent
The next indicator is to understand what percentage of your customer traffic inflow buys your
product or services. You can collect this data from marketing interactions, webpage traffic,
customer demographics, and return of clients.
To measure purchasing intent relative to your brand, you will have to consider a group of factors
related to your brand. Your brand might be selling the products directly, or through other
sources as well.
In your analytics, you can track how many visitors click a specific button, such as “Buy Now” or
“Contact,” with goals and events. These metrics indicate that users are interested in your
product or service.
4. Purchase
The purchasing stage of brand awareness looks at how many people buy your product or
service. In short, you’re looking at your sales figures.
There are 3 KPIs to measure:
Volume: The demand for your products and services.
Velocity: The speed a customer travels through the buying process.
Value: The ability to sell at a premium price and avoid discounting.
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Pitch deck title
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5. Brand Advocacy
Your brand’s advocates are either your customers who are
fully satisfied by your products or services, or they are
enticed by your referral programs. Either way, they promote
your brand for free to people who trust them, which means
their marketing conversion rates are very high.
It is difficult to measure this indicator as there might not be
enough available data. However, you can collect some firsthand information through interactions with your customers
with the help of:
Online surveys or questionnaires.
Mentions on social media or blogs and the
emotions behind them.
Volume of mentions and sentiment analysis
Volume of mentions and sentiment analysis are two
sides of the same coin. To get the whole picture of
the state of your brand you have to examine the
number of mentions about your brand and the
context of the mentions.
Imagine you see a sudden spike in the number of
mentions containing your keyword. Initially, you might
think it’s a positive indicator of your brand’s
reputation and online presence.
By analysing the sentiment of your brand’s mentions
you’re able to assess how people feel about your
brand. A high number of mentions and a rise in
negative sentiment is an indicator of an approaching
crisis.
On the other hand, when the sentiment is mostly
positive, you can focus more on brand building and
communication to reach even wider audience with
your messaging.
Assess Brand Loyalty
• Performance is “good” when it
drives measurable outcomes. In brand
marketing, this means high brand
loyalty and willingness to repurchase,
plus recommend the product to
others.
• When your brand performs well, it
does the selling for you. So are you
doing enough to turn your customers
into active brand advocates and peerto-peer promoters?
• Organic online mentions and
recommendations from customers,
influencers, and media are also a
good proxy sign for a brand's loyalty
and popularity.
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5. Brand Advocacy
Competitor Benchmarking & Analysis
As part of brand monitoring, you can look to measure
the performance of your marketing and advertising
by measuring the amount of mentions you’ve had on
a channel, or how many new web domains covered
the latest story about your new product
release. Then you can group your brand and
competitors and measure your success versus them
to know where you rank.
BrandTrust Performance Monitor - BPM
The BPM reveals the strength of the individual
brands within their industry, shows who the winners
and losers are.
With this matrix we illustrate the entire competitive
structure and show the status quo of the brands in their
competitive environment. Based on this knowledge we
can define the strategically expedient direction of thrust
for individual brands.
The 4 fields of the BPM:
•No Brand: This field contains the brands with the lowest awareness and attractiveness. They are
usually not key players (yet). Startups in particular start out in the No Brand sector when they are
founded.
•In Brand: Brands that are placed in this field are highly attractive, but not well known. They are the
brands of tomorrow. They are considered insider tips or niche brands. Typically, the highly
specialized hidden champion brands of German SMEs are found in the In Brand sector.
•Star Brand: Brands in this field are both well-known and attractive. This is the sector to strive for.
The challenge is to maintain this Star Brand position and not slide off into the Out Brand sector. This
can only succeed with a consistent transformation of the brand.
•Out Brand: Brands in this category are well known, but not very attractive. They are yesterday's
brands that have passed their peak. But there is hope: Such brands need to focus on their core
competences and their essential attractiveness drivers. In addition, they should reduce their
awareness, perhaps by closing shops or branches. This can turn an Out Brand into an In Brand. A
move directly back to the Star Brand sector very rarely succeeds.
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SO…..
How often to run your brand tracker
• The frequency with which you should run your tracker
will depend on a few different factors.
Factor 1: What you are tracking
For most brands, tracking is primarily focused on a brand funnel – how
efficiently a brand moves buyers from general brand awareness, down to
purchase intent, and eventually into loyalty and advocacy. For most
brands that track a brand funnel, running a tracker annually should provide
enough data for them to measure market shifts without spending
unnecessary budget resources.
Factor 2: How quickly your market changes
Some markets simply move faster than others. Marketers working on a
toothpaste brand probably don’t need to deal with the market velocity
that occupies marketers working in high tech. If your industry sees swift
changes with fast news cycles, aggressive competitors, changing
technology and frequent product innovations, you may need to run a
tracker more often – monthly or quarterly.
Factor 3: The entrance of new competitors
The entrance of a major new competitor may merit an ad-hoc new
measurement of your brand.
The entrance of Red Bull, an Austrian beverage company, into the US
market, would have been an excellent time for Coke to run a pre and postentry brand tracker measuring the impact on Coke’s purchase intent.
Dunkin Donuts’ aggressive move into coffee should have had Starbucks
running trackers to gauge the reaction from buyers.
Amazon’s short-lived entrance into the mobile phone market with its Fire
phone likely triggered Apple and Samsung to run trackers to understand
how the market was changing.
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• The frequency with which you should run your tracker
will depend on a few different factors.
Factor 4: The frequency of your ad campaigns
Brand trackers are not infallible when it comes to measuring the impact of
individual marketing campaigns, but when run correctly, they can give you helpful
knowledge about which campaigns are moving the needle and which aren’t. You
may want to plan brand trackers to run before and after major marketing
campaigns to understand how effective your efforts were.
Factor 5: Unexpected events
Some unexpected company events aren’t welcome – like when a celebrity sends
out an unfavorable tweet about your brand, or when a customer videos an
employee acting inappropriately, and it goes viral.
Other unexpected events are welcome – for example if your product gets a
shoutout from this year’s biggest popstar. But regardless of whether the event is
positive or negative for your brand, it may offer an opportunity for you to run an
impromptu brand tracker to understand how it is affecting your brand.
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Most known measuring tools
technology makes it easy to figure out what people are saying
about your brand online. Otherwise, you would need a full-time
staff to scour the far corners of the internet.
Here are the top three brand monitoring tools:
Google Alerts
BrandMentions
PeakMetrics
Technically, this tool is not just for brand monitoring, but it works well for
this purpose.
All you have to do is type your company name (and variations) into the
search bar. The program sets up email alerts and notifies you whenever
something new pops up.
Google Alerts is also helpful for market research and analysis.
You can get notified for specific keywords related to your business and
quickly stay on top of trends.
The tool allows you to set up the frequency of your alerts, and you can
refine your notifications to a specific region.
Google can also curate your list to provide only the top-ranked results.
This way, you can avoid a potential barrage of mentions in your inbox.
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This tool is a one-stop-shop for everything you need to
monitor your brand.
You can sign up for free and get a taste of what to expect.
BrandMentions searches through all online channels so
that you don’t have to.
This tool shows you the number of positive and negative
interactions in an easy-to-read graph. This way, you can see
how well your brand is doing over time.
Competitor Spying
You can dig deeper into the competition and gain insight
into how they’re promoting themselves.
Business Intelligence
You can get action lists related to your mentions.
For example, if users want you to open a store in a specific
area, you can monitor engagement and see if it will be
profitable to obey their wishes.
• Technically, this isn’t a brand monitoring tool, but it’s hugely valuable if you want to
understand your market and your customers better.
• PeakMetrics uses Nielsen data to aggregate tons of information about consumer habits.
• But don’t worry about drowning in statistics and graphs. PeakMetrics can curate this data for
you into easy-to-read reports.
• Best of all, you can use the tool to see how well your marketing is doing.
• Once you start a new promotion, you can see how it impacts your customers and their buying
patterns.
• If your campaign is a hit, you can dive deeper to see why it resonated so well with your
audience. If it fizzles out, you know to adjust your strategy next time.
• Another benefit of tapping into Nielsen data is that you can monitor all channels, both online
and offline.
• For example, if you have any radio, TV, or magazine ads, you can get data about those too.
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References
1.
Keller, K. L. (2020, January 19). Leveraging
secondary associations to build brand equity:
theoretical perspectives and practical applications.
International Journal of Advertising, 39(4), 448–
465.
https://doi.org/10.1080/02650487.2019.1710973
2.
Keller, K. L., & Swaminathan, V. (2019, April 18).
Strategic Brand Management: Building, Measuring,
and Managing Brand Equity.
3.
Kapferer, J. N., & Kapferer, J. N. (2004, October 1).
The New Strategic Brand Management: Creating
and Sustaining Brand Equity Long Term.
https://doi.org/10.1604/9780749442835
4.
Niraj Dawar and Charan K. Bagga “ A better way to
map brand strategy” – published article by harward
business review, June 2015
5.
“How to build a brand”, a comprehensive guide
from Hubspot and Rebrandly.
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