2

Chapter Two

Corporate Image
and

Brand Management
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How important are brand names?

How important are brand names
for clothes?
In what product categories are
brand names important?
What product categories are brand
names not important?
What is your image of Gucci?
What determines your image of
Gucci?

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Brand and Corporate

Image Management

Chapter Overview
Managing a corporations image
Managing brands
Issues associated with developing
and promoting brand names and
logos
Importance of packaging and
labels
Developing brand and corporate
positioning strategies

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A corporate
image
advertisement
by State Farm

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Components of a Corporate Image

Study by Edelman Asia Pacific
Quality of goods and services.
Willingness of firm to stand behind its products.
Perception of how the firm deals with
customers.

Source: Arun Sudhaman, Brand Quality Still Key to Corporate Reputation: Edelman,
Media Asia, November 19, 2004, p. 8.
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FIGURE

2.1

Components of a Corporate Image

Tangible Elements

1. Goods and services sold.

2. Retail outlets where product
is sold.
3. Factories where product is
produced.
4. Advertising, promotions, and
other forms of communications.
5. Corporate name and logo
6. Packages and labels
7. Employees

Intangible Elements

1. Corporate, personnel, and

environmental policies.
2. Ideals and beliefs of corporate
personnel.
3. Culture of country and location
of the company.
4. Media reports.

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Interview with Bob Baxter,

Manager of Marketing Research
Mercedes Benz of North America

Before watching this

interview:
What word(s) would you use
to describe the Mercedes
Benz car? What is your
image of the Mercedes?

Click picture to play video.

After watching this interview:

What would you do if you
were Bob Baxter?
Discussion Slide
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Role of Corporate Image

Consumer perspective.
Business-to-business perspective.
Company perspective.
Sonys Web site is
continually updated,
but still retains a
consistent corporate
image.
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Role of Corporate Image

Consumer Perspective
Positive assurance
Unfamiliar settings
Little or no previous experience

Reduces search time

Provides psychological reinforcement
Social acceptance

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Role of Corporate Image

Company Perspective

Extension of feelings to new products

Ability to charge more
Consumer loyalty
More frequent purchases by customers
Positive word-of-mouth
Attracts higher quality employees
More favorable ratings
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Top 10 Global Corporate Brands

Coca-Cola
Microsoft
IBM
General Electric
Nokia
Toyota
Intel
McDonalds
Disney
Mercedes Benz

Brand Value ($billion)

$ 65.3
$ 58.7
$ 57.1
$ 51.5
$ 33.7
$ 32.1
$ 30.9
$ 29.4
$ 29.2
$ 23.6

Source: Based on The 100 Top Brands, Business Week (August 6, 2007), pp. 59-64.
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Corporate Image
1.
2.
3.
4.
5.

Accurate reflection of firm

Reinforcing
Rejuvenating an image
Changing an image
Negative or bad press

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2-12

Promoting the Right Image

Creating the right image.
Conveys a clear message about the organization.
Should portray the nature of the firm.
Fit with products being sold.

Rejuvenating an image.
Easier than changing a well-established image.
Add new elements but continue current image.

Changing an image.
Extremely difficult.
Necessary when
Target market has shrunk or disappeared.
Current image not consistent with industry trends.

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2-13

This Family Circle ad aims to change the magazines image, reflecting

changes in culture,

What does this ad say about the contemporary family woman versus the
one of 30 years ago?
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What image is being conveyed by

this BMW advertisement?
What image is being conveyed by
the BMW Motorcycles Web site?
http://www.bmwmotorcycles.com
Are the images consistent?

Click image to enlarge.

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Corporate Names
Overt names
Implied names
Conceptual names
Iconoclastic names

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Iconoclastic Names

Skeeter Boats
Yamaha

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FIGURE

2 .4

Tests of Quality Logos and Corporate Names

Should be easily recognizable.

Should be familiar.
Should elicit a consensual meaning
among firms target market.
Stimulus codeability

Should evoke positive feelings.

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2-18

Benefits of Logo Recognizability

Aids in recall of specific brands.
Aids in recall of advertisements.
Reduces shopping effort.
Reduces search time and evaluation
of alternatives.

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2-19

What colors should you use in your logo?

Black seriousness, distinctiveness, boldness,

power, sophistication, and tradition.
Blue authority, dignity, security, faithfulness,
heritage, corporate stability, and trust.
Brown/gold history, utility, earthiness,
richness, tradition, and conservative.
Gray/silver somberness, authority, practicality,
corporate mentality, and trust.
Green tranquility, health, freshness, stability,
and appetite.
Orange fun, cheerfulness, warm exuberance,
health, and youth.

Source: Jared McCarthy, Logos: What Makes Them Work (Part 1of 2),
(www.marketingprofs.com/5/mccarthy4.asp), February 22, 2005.
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What colors should you use in your logo?

Pink femininity, innocence, softness, health, and

youth.

Purple sophistication, spirituality, wealth,

royalty, youth, and mystery.

Red aggressiveness, passion, strength, vitality,

fear, speed, and appetite.

White/silver purity, truthfulness, faith,

contemporary, refined, and wealth.

Yellow youth, positive feelings, sunshine,

cowardice, refinement, caution, and appetite.

Source: Jared McCarthy, Logos: What Makes Them Work (Part 1of 2),
(www.marketingprofs.com/5/mccarthy4.asp), February 22, 2005.
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Logo Recognizability

McDonalds Golden Arches logo is recognizable

enough to stand on its own.
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Companies often
create product icons
to develop an identity
for their products.

Why is the
Mr. Clean icon
an effective
representative
for its product?

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Branding

Provides quality assurance.

Reduces search time.
Allows a company to charge more.
Reduces brand parity.
Consumers choose a brand because it is:
Salient
Memorable
Noteworthy

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Branding
If you didnt find the brand you wanted, would you
be likely to buy another brand?
Greeting cards
Groceries and canned food
Womens apparel
Mens apparel
Toys
Candy
Beverages
Consumer electronics
Computer software

68%
67%
50%
55%
47%
47%
49%
40%
35%

Source: Debbie Howell, Todays Consumers More Open To Try New Brands, DSN
Retailing Today, vol. 43, No. 20 (October 25, 2004), pp. 29-31.
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Developing a Strong Brand Name

Begins with understanding why consumers buy a brand.

What are the most compelling benefits?

What emotions are elicited by the brand
either during or after the purchase?
What one word best describes the brand?
What is important to consumers in the
purchase of the product?

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F I G U R E 2 .6
Benefits of Brand Equity

Higher prices
Higher gross margins
Channel power
Additional retail shelf space
Reduces customer switching
behavior
Prevents erosion of market share

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Brand Equity

Mercedes Benz has developed a high level of brand equity.

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F I G U R E 2 .7
Steps in Building Brand Equity
1. Research and analyze what it would
take to make the brand distinctive.
2. Engage in continuous innovation.
3. Move fast.
4. Integrate new and old media.
5. Focus on domination.

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Measuring Brand Equity

Brand Metrics
Brand metrics measure return on branding investments.

Attitudinal measures
Awareness
Recall
Recognition
Brand power index (BPI)
Most preferred brand (DSN Retailing)
Revenue premium approach
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FIGURE

2 .8

Top 10 Most Powerful Brands (AlixPartners)

Brand

Trust Rate

Sony
Johnson & Johnson
Kraft
Procter& Gamble
Campbells
Toyota
Tylenol
Dell
General Mills
Hewlett-Packard

9.2%
5.7%
5.2$
5.8%
3.5%
4.1%
3.2%
5.1%
2.7%
4.0%

Distrust Rate
1.8%
0.5%
0.6%
1.1%
0.4%
1.2%
0.6%
2.1%
0.2%
1.5%

BPI
75.1
55.3
48.7
48.2
32.9
28.0
27.2
27.0
25.9
23.5

BPI = awareness, trust, and distrust.

Source: Adapted from Fred Crawford, Branding Isnt Like High School, Retail Merchandiser,
Vol. 47, No. 6 (July/August 2007), pp. S4-S9.
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F I G U R E 2 .9
Most Preferred Brands (DSN Retailing)
Womens Apparel
1.
2.
3.
4.
5.
6.

Hanes (39%)
Levis (10%)
Victorias Secret (6%)
Liz Claiborne (4%)
Nike (4%)
Fruit-of-the-Loom (4%)

Snacks

1.
2.
3.
4.
5.

Beverages
1.
2.
3.
4.

Coke (26%)
Pepsi (22%)
Dr. Pepper (6%)
Mountain Dew (5%)

Consumer Electronics

Frito Lay/Lays (19%)

Doritos (10%)
Hersheys (6%)
Pringles (6%)
Oreos (5%)

1.
2.
3.
4.
5.

Sony (27%)
RCA (6%)
Panasonic (6%)
Dell (5%)
Duracell (4%)

Source: Adapted from Debbie Howell, Top Brands, DSN Retailing Today, Vol. 44, No. 20 (October 24, 2005), pp. 38-42.

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Types of Brands
Family brands
Brand extension
Flanker brand
Co-branding
Ingredient branding
Cooperative branding
Complementary branding
Private brands
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Head & Shoulders is

one of the brands
sold by Procter &
Gamble.

Access their Web

site to see what
other brands they
sell in the United
States as well as
other countries.
http://www.pg.com

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F I G U R E 2 .11
Forms of Co-Branding
Ingredient Branding

Co- Branding

Cooperative Branding

Complementary Branding

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Growth of Private Brands

15% of all retail sales.

19% of food sales

Last 10 years:
64% increase in store brand sales.
30% increase in manufacturers brand sales
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FIGURE

2 .12

Changes in Private Labels

Improved quality.
Perceived as a value purchase.
Higher loyalty towards retail outlets and lower
loyalty towards specific brands.
Used to differentiate retail outlets.
Increased advertising of private brands.
Increased quality of in-store displays and
packaging of private brands.
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Private Label Sales as a Percentage of Total Sales

50%

45%

45%

Percent of Total Sales

40%
35%
30%
25%
20%

21%

21%

18%

18%

16%

15%

15%
10%
5%
0%
Saks' DSG

Dillard's

May
Department
Store

Goody's
Family
Clothing

Nordstrom

JP Penney
(apparel
only)

Federated

Source: Thomas J. Ryan, Private Labels: Strong, Strategic & Growing, Apparel Magazine, Vol. 44, No. 10
(June 2003), pp. 32-39.

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FIGURE

2 .13

Strategies Used to Combat Private Labels

Focus on core brands

Increase advertising
Introduce new products
Focus on in-store selling, packaging
Use alternative methods of marketing

Source: Adapted from Vanessa L. Facenda, A Swift Kick to the Privates, Brandweek,
Vol. 48, No. 31 (September 3, 2007), pp. 24-28.
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Packaging
Traditional elements

Protect the product inside

Provide for ease of shipping, moving, and handling
Provide for easy placement on store shelves
Prevent or reduce the possibility of theft
Prevent tampering

New trends
Meet consumer needs for speed, convenience, and
portability
Must be contemporary and striking
Must be designed for ease of use
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Labels

Must meet legal requirements.

Provide another marketing

opportunity.

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Positioning Approaches
1. Is relative to competition.
2. Exists in the mind of the consumer.
Attributes
Competitors
Use or application
Price/quality
Product user
Product class
Cultural symbol

Consumer markets
B-to-B markets
International markets

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A business-to-business
An advertisement by Stetson
advertisement positioned by
positioned by cultural
the products attributes: the
symbols.
brightness of the Sony
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projector.

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Ethical Issues
Brand infringement
Brand name becomes a generic term
Domain or cyber squatting

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International Implications

Adaptation vs. standardization

Standardization reduces costs
Shrinking world standardization
High-profile, high-involvement global brand
Low-involvement products local brand
Packaging and labeling
Image and positioning issues

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