Brand management

9: Brand as a positioning
1.1: What is a brand?

- can be defined as a name, term, sign or symbol or a combination of all of these, intended to identify
the goods or services of one seller and to differentiate them from those of competitors

-branding is all about creating a difference

- branded goods are distinguished from unbranded goods by their intrinsic and symbolic value and
therefore command a premium price: The intrinsic value is tangible and associated with product
attributes such as performance, durability, workmanship, precious materials. The product and its
attributes are the starting point in building any brand identity

- a brand name creates a common identify for the product and highlights the ways in which it’s
different from other products

- pl: Armani’s products would just be clothes if the brand Armani didn’t create a story along with layers
of memories and emotions behind the products

- nowadays the brand has become the most important corporate asset in many industries; industry
and marketing are strongly interconnected: fashion and luxury companies spend millions of euros on
creating brands  brand equity

- brands with long, unchanged history: Hermés, Chanel, Ermenegildo Zegna

- more recent brands with image change: Burberry, Gucci

- new creations brands: Zara, Seven Jeans

- strong brands have clear positioning

- in fashion, design and entertainment brand is a key strategic objective

- a strong brand image helps the business add value for the customers and for shareholders

Brand equity as a financial asset

 without placing a monetary value on each brand, corporate executives have no way of knowing
the total worth of their companies
 crucial to value the brand as an intangible asset for M&A activities

Brand equity as potential for brand extensions

 brand equity is a measure of a mature brand’s ability to assist in the development of similar
brand types (extensions)
 the more equity a brand has, the better able it is to lead to new avenues of expansion
 it is the loyal customer who’s willing to adopt brand extensions when they become available
 financial considerations become important when contemplating an acquisition or introducing
a new brand
 a prediction can be made about potential future growth

Brand equity as customer perspective

  research proves that marketing managers or researchers can determine what value the
customers place on a brand
 Keller & Krishnan offer a model of brand image. They believe that base of a strong brand image
is brand knowledge. According to them, a consumer’s knowledge of a brand is the result of the
memory of various associations
 the goal of the brand manager is to cultivate a unique image that cannot be copied or imitated
by other brands
 Keller uses a multi-step approach in developing his brand knowledge model. He believes that
by building favourable brand associations, customers will develop a positive attitude towards
the brand
 branding involves creating mental structures and helping consumers organising their
knowledge
 brand is defined by the values of the people who use it

- successful brands place customers at the centre of their corporate culture; even if the current fashion
is to increase shareholder value

- identity tells about the brand history, and sources of uniqueness; it communicates the organisation’s
core beliefs and values

- to create a strong brand image, a company should be able to build a strong and shared brand identity
first, then be able to communicate this identity in a consistent and relevant way through all the contact
points for the customer

1.2: The brand identity model

- luxury and fashion brand management is a balancing act: keeping up with traditions, breaking from
them, balancing old and new, staid ad stylish, nurturing the roots of tradition and know how, at the
same time staying fresh, relevant and contemporary

- successful brands constantly see new improvements to satisfy a changing consumer base

- the model identifies 4 main elements: heritage, style, retail, communication

- these elements create a long-term positioning

- an effective positioning allows brands to build strong, favourable and unique associations in the
consumer mind

- branding is about integrating

- internal consistency (for brand positioning) and external relevance (market evolution, socio-
economic content) are key