MKT 427: CHAPTER- 7
LEVERAGING SECONDARY BRAND KNOWLEDGE TO BUILD
BRAND EQUITY
1. Companies (through branding strategies)
2. Countries or other geographic areas (through identification of product origin)
3. Channels of distribution (through channel strategy)
4. Other brands (through co-branding)
5. Characters (through licensing)
6. Spokespersons (through endorsements)
7. Events (through sponsorship)
8. Other third-party sources (through awards or reviews)
CONCEPTUALIZING THE LEVERAGING PROCESS
Creation of New Brand Associations
Effects on Existing Brand Knowledge
To describe the process more formally, here are three important factors in predicting the
extent of leverage from linking the brand to another entity:
1. Awareness and knowledge of the entity: If consumers have no awareness or
knowledge of the secondary entity, then obviously there is nothing they can transfer
from it. Ideally, consumers would be aware of the entity; hold some strong, favorable, and
perhaps even unique associations about it; and have positive judgments and feelings
about it.
2. Meaningfulness of the knowledge of the entity: Given that the entity evokes some
positive associations, judgments, or feelings, are this knowledge relevant and meaningful
for the brand? The meaningfulness may vary depending on the brand and product
context. Some associations, judgments, or feelings may seem relevant to and valuable for
the brand, whereas others may seem to consumers to have little connection.
3. Transferability of the knowledge of the entity: Assuming that some potentially
useful and meaningful associations, judgments, or feelings exist regarding the entity and
could possibly transfer to the brand, how strongly will this knowledge actually become
linked to the brand?
COMPANY
 Create a new brand
 Adopt or modify an existing brand
 Combine an existing and new brand
COUNTRY OF ORIGIN OR OTHER GEOGRAPHIC AREAS
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CHANNELS OF DISTRIBUTION
Understanding Retailers Brand Image dimension
CK
Calvin Klein1970, ad, nothing come between her and her CK. 1985 obsession perfume, 2nd
selling perfume. Channels of CK -Warnaco -JCPenney, was cheapening, the CK brand by
selling to JCPenney. Trial, case, 2001 CK vs Warnaco. Warnaco Stopped to sell at
JCPenney, but Costco, SAMS club continued. Philips Van Heusen acquired CK for 700 M
$, 2003, relation developed
CO-BRANDING
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Advantages
Borrow needed expertise
Leverage equity you don’t have
Reduce cost of production introduction
Expand brand meaning in related categories
Broaden meaning
Increase access points
Source of additional revenue
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Disadvantages
Loss of control
Risk of brand equity dilution
Negative feedback effects
Lack of brand focus and clarity
Organizational distraction
Swatch: Smart car at 10000 US$. Affordability, Durability and Stylishness with
Mercedes Benz didn’t run Crash was Security and Safety. Sold to Daimler Chrysler, 1998,
130000 units in year 2004
Guidelines:
Both should have
 Brand awareness,
 Sufficiently strong, favorable and unique brand associations
 And positive consumer judgment and feelings.
 What capabilities do you have?
 What resource constraints are you faced with people, time or money?
 What growth goals revenue needs do you have?
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Is it a profitable business venture?
How does it help to maintain or strengthen brand equity?
Is there any possible risk of dilution of brand equity?
Does it offer any extrinsic advantages?
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Ingredient branding
Singapore Airlines
New Raffles Class, French Design House Givenchy, Ultimo seats.Dolby Headphone
World Gourmet Cuisine by International panel of chefs
Intel
Intel was founded on July 18, 1968, as Integrated Electronics Corporation. Awareness
increased from 24% to 80% with Ingredient branding with IBM and Compaq in 1991,
now 94%. Consumer preference level is 80%
Advantages
Disadvantages
 Greater sales can be generated at a  The cost of supporting a marketing
higher margin
campaign can be high
 Enhance its own brand equity.
 There is a loss of control because
marketing programs for the supplier
 Manufacturer may have different objectives
and thus may send different signals to
customers
Requirements
 Perceive that the ingredient matters to the performance and success
 Must then be convinced that not all the ingredient brands are the same and that
the ingredient is superior.
 A distinctive symbol or logo
 A coordinated push and pull program must be put into
LICENSING
Hello kitty
A fictional character produced by the Japanese company Sanrio, first designed by Yuko
Shimizu. The character's first appearance on an item, a vinyl coin purse, was introduced
in Japan in 1975 and brought to the United States in 1976. Bag notebooks and Wedding
telegrams, boxer shirt. Daihatsu motor company, sold 1200, limited edition, & 7, 245
Hello Kitty Cars, Speedometer, 20 km/h, sleeping, 60-smilings, 80-sweating bullet.
Themed restaurant named Hello Kitty Sweets in Taipei, Taiwan.
Licensing the Disney way:
Merchandising licensing
Publishing
Music and audio
Computer software
Educational production
The Disney store
Catalog marketing
Disney characters (Donald, goofy)
Books, magazine and comic
Cassette and CD
Computer game
Film and reward
Shopping center
Disney quality program
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Guidelines
 Can really only a fad and produces short-lived sales.
 Can become overexposed and wear out quickly as a result.
Teenage Mutant Ninja Turtles:
First introduced in 1988, estimated $1 billion sales in 1991. Conventional souvenirs and
T shirts, Vanilla flavored pizza candy. After this high eater mark, however sales of
licensed Teenage Mutant Ninja Turtles merchandise dropped to &100 million in 1993.
Harley Davidson
POLO SHIRT, GOLD RING, WINE COOLER
CELEBRITY ENDORSEMENT
 Must be well enough known that the awareness, image and responses for the brand
may be improved.
 In terms of expertise, trustworthiness, and likeability or attractiveness, as well as
having specific associations that carry potential product relevance.
Potential Problems
Can be overused by endorsing
Firstly
Unreasonable match between the celebrity and the product
Secondly
Can get in trouble or lose popularity
Third
Celebrities are only doing the endorsement for the money and do not
Fourth
necessarily believe in or even use the endorsed brand.
May have trouble remembering the advertised brand.
Finally
Guidelines:
Well known and well defined celebrity
Relevant to the brand and likely to be transferable.
Creative fashion that highlights the relevant associations and encourages their transfer.
Market research, Q score of favoritism
 Palmolive used Kapil Dev in the '80s, his line 'Palmolive da jawaab nahin' became
famous -- it is remembered even today.
 Sachin Tendulkar means Pepsi in soft drinks, Boost in malted beverages, MRF in
tyres, Fiat Palio in cars, TVS Victor in two-wheelers, Colgate Total in toothpastes,
Britannia in biscuits, Visa in credit cards, Airtel in mobile services and Band-aid.
 Aamir Khan has signed a huge Rs 6 crore deal with Coca-Cola for the Thanda
Matlab Coca-Cola campaign. Thanda means cold, and is a generic term for soft
drinks in India.
 Bachchan has many endorsement deals under his belt. He's struck a Rs 8-crore deal
with healthcare major Dabur, a Rs 10 crore deal to promote ICICI products, a Rs 5
crore deal with Parker pens. He is also endorsing Reid & Taylor suits
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SPORTING CULTURE OR OTHER EVENTS
 Events have their own set of associations that may become linked to a sponsoring
brand under certain conditions.
 Which event can transfer associations is on the basis of various dimensions of
credibility.
 A brand may seem more likable or even trustworthy or expert by the virtue of
becoming linked to an event.
Clear Men Confidence Cup 2010
44colleges, 21st May to 5th June. Army stadium final, notre dame VS Govt barishall.
College won in 4-0. RCCI college Rangpur 3rd beating BAF shaheen college
Paper Studio (conqueror paper)
Conqueror Corporate Identity Design Contest. June & to July 1 2010. Dr. Muhammad
Yunus as a judge
VISA AND OLYMPIC
1985, American Express was giant. 1988, OLYMPIC. 1992, NOT TOUGH LIKE
GAME IF U DNT HAVE VISA CARD. Olympic Games Through 2012, Including The
Beijing 2008 Olympic Games,The Vancouver 2010 Olympic Winter Games and The
London 2012 Olympic Games. Visa Will Be The Only Card Accepted At All Olympic
Games Venues For Any Official Olympic-Related Transactions
THIRD PARTY SOURCES
The Good Housekeeping seal has been seen as a mark of quality for decades.
Pc magazine, Colgate’s hills science diet, P& G Iams brand Targeted vet in research and
funding
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