CHAPTER 1:
BRANDS AND BRAND
MANAGEMENT
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Learning Objectives
Define “brand,” state how brand differs from a
product, and explain what brand equity is
 Summarize why brands are important
 Explain how branding applies to virtually
everything
 Describe the main branding challenges and
opportunities
 Identify the steps in the strategic brand
management process

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What is a brand?
For the American Marketing Association (AMA), a brand is a
“name, term, sign, symbol, or design, or a combination of them,
intended to identify the goods and services of one seller or
group of sellers and to differentiate them from those of
competition.”
 These different components of a brand that identify and
differentiate it are brand elements.

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What is a brand?

Many practicing managers refer to a brand as more than
that— as something that has actually created a certain amount
of awareness, reputation, prominence, and so on in the
marketplace.
1.4
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What is a Brand?
Brand Elements
Brands versus Products
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Brand Elements

Different components that identifies and
differentiates a brand
 Name, logo, symbol, package design, or other
characteristic

Can be based on people, places, things, and
abstract images
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Brand versus Product
Brand
Product
Has dimensions that differentiate it in some
way from other products designed to satisfy
the same need
Anything available in the market for use or
consumption, that may satisfy a need or want
Can be differentiated on the basis of:
• Packaging
• Services provided
• Customer advice
• Financing
• Delivery arrangements
• Warehousing
• Other things valued by the customers
Can be categorized into five levels namely:
• Core benefit level
• Generic product level
• Expected product level
• Augmented product level
• Potential product level
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Five Levels of Meaning for a Product





The core benefit level is the fundamental need or want that consumers satisfy
by consuming the product or service.
The generic product level is a basic version of the product containing only
those attributes or characteristics absolutely necessary for its functioning but
with no distinguishing features. This is basically a stripped-down, no-frills
version of the product that adequately performs the product function.
The expected product level is a set of attributes or characteristics that buyers
normally expect and agree to when they purchase a product.
The augmented product level includes additional product attributes, benefits,
or related services that distinguish the product from competitors.
The potential product level includes all the augmentations and
transformations that a product might ultimately undergo in the future.
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Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.
To Sum Up ....

Through branding, organizations:
 Create perceived differences amongst products
 Develop loyal customer
 Create value that can translate to financial profits
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
A brand is therefore more than a product, as it can
have dimensions that differentiate it in some way
from other products designed to satisfy the same
need.
1.11
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
Some brands create competitive advantages with
product performance; other brands create
competitive advantages through non-productrelated means.
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Why Do Brands Matter?
Consumers
Firms
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Consumers
Encompass all types of customers, including
individuals as well as organizations
 Functions provided by brands to consumers

 Identify the source or maker of the product
 Simplify product decisions
 Lower the search costs for products internally and
externally
 Helps set reasonable expectations about what
consumers may not know about the brand
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Consumers
 Reduce risks in product decision
 These risk can be categorised as
 Functional ,physical, financial, social psychological, and time
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Reducing the Risks in Product Decisions
Consumers may perceive many different types of risks in
buying and consuming a product:
 Functional risk—The product does not perform up to
expectations.
 Physical risk—The product poses a threat to the physical
well-being or health of the user 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.
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
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Firms

Brands provide valuable functions
 Simplify product handling and tracing
 Offer the firm legal protection for unique features or
aspects of the product
 Provide predictability and security of demand for the
firm and creates barriers of entry for competitors
 Provide a powerful means to secure competitive
advantage
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Figure 1.3 - Roles that Brands Play
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Can Anything Be Branded
Physical Goods
Services
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Physical Goods
Business-to-Business
Products
High-tech Products
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Services
Role of Branding with Services
Professional Services
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Can Anything Be Branded
Retailers and Distributors
Online Products and Services
People and Organizations
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Role of Branding
Sports , Arts, and Entertainment
Geographic Locations
Ideas and Causes
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To Sum up....
Branding is universal and pervasive in different
product categories
 Applicable to both tangible and intangible
offerings of an organization
 Technological developments have impacted the way
firms market their offerings
 Organizations reap financial benefits from positive
brand images

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Source of Brands Strength

“The real causes of enduring market leadership are
vision and will. Enduring market leaders have a
revolutionary and inspiring vision of the mass
market, and they exhibit an indomitable will to
realize that vision. They persist under adversity,
innovate relentlessly, commit financial resources, and
leverage assets to realize their vision.”
Gerald J. Tellis and Peter N. Golder, “First to Market, First to
Fail? Real Causes of Enduring Market Leadership,” MIT Sloan
Management Review, 1 January 1996
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Importance of Brand Management

The bottom line is that any brand—no matter how
strong at one point in time—is vulnerable, and
susceptible to poor brand management.
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Branding Challenges and Opportunities

Savvy customers
 knowledgeable consumers

Brand proliferation
 new products and line extensions that are slight
variations

Media fragmentation
 Describes a trend to increasing choice and consumption of a range
of media in terms of different channels such as web and mobile and also
within channels, for example more TV channels, radio stations, magazines,
more websites. • Media fragmentation implies increased difficulty in
reaching target audiences.
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Figure 1.9- Challenges to Brand
Builders
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Brand Identity and
Brand Image


Identity is on the sender’s side. Its purpose is to
specify the brand’s meaning, aim and self image
Image is on the receiver’s side. It’s how groups
perceive the brand. Image refers to the way in
which groups decode all of the signals emanating
from the brand’s products, services and
communications
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Brand Positioning
A brand for what? - brand promise and consumer
benefit
A brand for whom? - target aspect
A brand for when? - occasion when product is
consumed
A brand against whom? - competitors
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The Brand Equity Concept
No common viewpoint on how it should be
conceptualized and measured
 It stresses the importance of brand role in marketing
strategies.
 Brand equity is defined in terms of the marketing
effects uniquely attributable to the brand.

 Brand equity relates to the fact that different outcomes result
in the marketing of a product or service because of its brand
name, as compared to if the same product or service did not
have that name.
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Brand Equity

Customer-Based Brand Equity (CBBE)
 It is the differential effect that brand knowledge has on
consumer response to the marketing of that brand
 A positive CBBE means customer might be more
accepting to the marketing activities (ie. the marketing
mix) for a brand
Keller (2008) & Keller (1993), “Conceptualizing, Measuring and Managing
Customer-Based Brand Equity,” Journal of Marketing, 57(1), pp. 1-29
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Brand Equity

Principles of branding and brand equity
 Differences in outcomes arise from the “added value”
endowed to a product
 The added value can be created for a brand in many
different ways
 Brand equity provides a common denominator for interpreting
marketing strategies and assessing the value of a brand
 There are many different ways in which the value of a brand
can be exploited to benefit the firm
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Strategic Brand Management
Process
Identifying and Developing Brand Plans
Designing and Implementing Brand
Marketing Programs
Measuring and Interpreting Brand
Performance
Growing and Sustaining Brand Equity
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Figure 1.12 - Strategic Brand
Management Process
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