Marketing Essentials
n Chapter 31 Branding, Packaging, and Labeling
Section 31.1 Branding Elements
and Strategies
Chapter 31 n Branding, Packaging, and Labeling
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SECTION 31.1
Branding Elements
and Strategies
What You'll Learn
 The nature, scope, and importance of
branding in product planning
 The various branding elements
 The different types of brands
 How to classify branding strategies
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SECTION 31.1
Branding Elements
and Strategies
Why It's Important
The right name is an important part of every
successful business. The name and symbols
of a business or a product project the
personality of the company, product,
or service.
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SECTION 31.1
Branding Elements
and Strategies
Key Terms
 brand
 private distributor brand
 brand name
 generic brand
 brand mark
 brand extension
 trade name
 brand licensing
 trade character
 mixed-brand strategy
 trademark
 co-branding strategy
 manufacturer brand
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SECTION 31.1
Branding
Branding Elements
and Strategies
A brand is a name, term, design, or symbol (or
combinations of them) that identifies a business
or organization and the products that they offer.
Brands are divided into two categories:
 corporate brands
 product brands
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SECTION 31.1
Branding
Branding Elements
and Strategies
Corporate brands identify the business
and reflect quality, value, and reliability.
 Example: Coca-Cola, Disney,
McDonald's, and Citibank
Product brands connote quality and reliability
for a particular product.
 Example: Pepsi, Coke, Barbie, Whopper,
and Big Mac
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SECTION 31.1
Branding
Branding Elements
and Strategies
A brand name is the word, group of words,
letters, or numbers of a brand that can
be spoken.
 Example: PT Cruiser, Mountain Dew,
SnackWells, and K2
A brand mark is a symbol, design, or distinctive
coloring or lettering that identifies a brand.
 Example: U.S. Postal Service's eagle,
Apple Computer's apple
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SECTION 31.1
Branding
Branding Elements
and Strategies
A trade name is the legal name under which a
company or division of a corporation does
business.
 Example: Amex, Dell, Kellogg's, and Xerox
A trade character is a brand mark with human
form or characteristics.
 Example: The Jolly Green Giant, the Pillsbury
Doughboy
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SECTION 31.1
Branding
Branding Elements
and Strategies
A trademark is a brand name, brand mark,
trade name, trade character, or a combination
of these given legal protection by the federal
government and noted by the trademark
symbol ().
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SECTION 31.1
Branding
Branding Elements
and Strategies
Brand names, brand marks, trade names,
trade characters, and trademarks are often
combined to form a firm's corporate
symbol or name.
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SECTION 31.1
Branding Elements
and Strategies
Top Ten Brands
Rank
Brand
Company
1999 Advertising
(in millions of dollars)
1
Chevrolet
vehicles
General
Motors Corp.
762.4
2
AT&T
telephone services
Dodge
vehicles
AT&T Corp.
711.4
DaimlerChrysler
651.7
4
Ford
vehicles
Ford Motor
Company
629.5
5
McDonald's
restaurants
Toyota
vehicles
Sears
department stores
McDonald's
Corp.
Toyota Motor
Corp.
Sears,
Roebuck & Co.
627.2
Sprint
telephone services
Chrysler
vehicles
Sprint Corp.
470.1
DaimlerChrysler
426.5
Nissan
vehicles
Nissan Motor
Co.
416.9
3
6
7
8
9
10
569.4
556.1
Brands are often a
company’s most valuable
asset. What is the total
1999 advertising
spending for these top
ten brands? Do you think
these brands would
continue to be valuable
if the companies reduced
or eliminated their
advertising?
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SECTION 31.1
Branding Elements
and Strategies
Importance of Brands in Product Planning
The use of brands is important in product
planning for several reasons. Branding:
 builds customer loyalty
 assures customers that products carrying
the same brand are of a consistent quality
 addresses new target markets
 establishes an image for a product or
company
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SECTION 31.1
Branding Elements
and Strategies
Generating Brands
Seventy-five percent of companies introduce a
new product name each year. Brand names are
generated by:
 company employees
 specialized computer software programs
 branding agencies, naming consultants,
and public relations agencies
Half of all corporate name changes occur
because of company mergers and acquisitions.
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SECTION 31.1
Branding Elements
and Strategies
Types of Brands
Three classifications of brands are:
 manufacturer brands
 private distributor brands
 generic brands
Slide 1 of 3
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SECTION 31.1
Branding Elements
and Strategies
Types of Brands
Manufacturer brands, also called producer
brands, are owned and initiated by manufacturers.
 Example: General Electric, Heinz, Motorola
Private distributor brands, also called private
brands, store brands, or dealer brands, are owned
and initiated by wholesalers and retailers.
 Example: Radio Shack, Kmart
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SECTION 31.1
Branding Elements
and Strategies
Types of Brands
Generic brands represent a general product
category and do not carry a company or brand
name. The packaging carries only a
description of the product, such as “pancake
mix” or “paper towels.” They are usually much
cheaper than brand-name products.
Slide 3 of 3
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SECTION 31.1
Branding Elements
and Strategies
Brand Strategies
Branding strategies are the ways companies
use brands to meet sales and company
objectives. Strategies include:
 brand extensions
 brand licensing
 mixed branding
 co-branding
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SECTION 31.1
Branding Elements
and Strategies
Brand Extension
Brand extension is a branding strategy that
uses an existing brand name for an improved
or new product in the product line.
 Example: Ocean Spray Cranberry Juice
extended to Cran-Apple, Cran-Raspberry, etc.
Advantages: Reduces risk of new product failure
Disadvantages: Over-extending a product line can
cause brand dilution
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SECTION 31.1
Branding Elements
and Strategies
Brand Licensing
Brand licensing is the legal authorization by
a trademarked brand owner to allow another
company (the licensee) to use its brand,
brand mark, or trade character for a fee.
Advantages: Enhance company image,
sell more products
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SECTION 31.1
Branding Elements
and Strategies
Mixed Brands
A mixed-brand strategy involves
simultaneously offering a combination of
manufacturer, private distributor, and
generic brands.
 Example: Union Carbide sells Glad
brand garbage bags and generic brand
garbage bags.
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SECTION 31.1
Co-Branding
Branding Elements
and Strategies
A co-branding strategy combines one or more
brands to increase customer loyalty and sales for
each individual brand.
 Example: Kellogg’s Pop-Tarts are made only
with Smucker’s fruit filling. Starbucks Coffee
Co.
opens coffee shops inside Barnes & Noble
bookstores.
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31.1 ASSESSMENT
Reviewing Key Terms and Concepts
1. What is the difference between a brand
name and a brand mark?
2. Why is branding important to product
planning?
3. Name three types of brands.
4. List four different branding strategies.
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31.1 ASSESSMENT
Thinking Critically
Internet service providers are teaming
with airlines, financial institutions, media
outlets, celebrities, and non-profit groups
to offer private-label Web access. Do you
think that individuals want to receive their
Internet access from the New York
Yankees, David Bowie, Pepsi, or their
local bank? Why or why not?
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31.1 Graphic Organizer
Types of Brands
TYPES OF BRANDS
Manufacturer
Brands
Private
Distributor
Brands
Generic
Brands
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Marketing Essentials
End of Section 31.1
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