Week 7

Brand positioning

Once a company has segmented the market and decided which segments of the
market it will target, it must decide how to position its brand.

The brand positioning is the act of designing a company’s offering and image to
occupy a distinctive place in the minds of the target market. 

Points-of-Difference and Points-of-Parity (1)

Points-of-difference (PODs): Attributes/benefits that consumers strongly associate

with a brand, positively evaluate, and believe they could not find to the same extent
with a competitive brand.
Points-of-parity (POPs): Attribute/benefit associations that are not necessarily unique
to the brand but may in fact be shared with other brands.

Brand and Branding

“A brand is a name, term, sign, symbol or design, or a combination of them, intended

to identify the goods or services of one seller or group of sellers and to differentiate
them from those of competitors”

Another way of thinking about a brand is the identity or personality of a product. But
developed in a way that is easily understood and readily identifiable.

But successful branding is not easy and requires a lot of planning and resources –
and we all too well understand how a brand’s position and reputation can easily be
eroded.

 Define brand equity

Customer-based brand equity is the differential effect brand knowledge has on

consumer response to the marketing of that brand.

A brand has positive customer-based brand equity when consumers react more
favorably to a product and the way it is marketed when the brand is identified than
when it is not identified. A brand has negative customer-based brand equity if
consumers react less favorably to marketing activity for the brand under the same
circumstances.

Brand equity models

There are different ways to develop brand equity. Here we will introduce three
models.

BrandAsset Valuator
This tool focuses on four key areas:

  Energized Differentiation
 Relevance
 Esteem
 Knowledge

The Brand Asset Valuator Model

The relationship between these four pillars and the different stages in the cycle of
brand development are summarized in the following.

The Universe of Brand Performance

While there are many global brands in the above you might want to consider where
across the above four quadrants you might place the following brands.

BRANDZ

This approach measures brand equity via the following factors:

  Presence/familiarity
 Relevance
 Performance
 Advantage
 Bonding

Brand Resonance Model

A further model is the Brand Resonance Model.

The following summary is a further approach to measuring brand equity.

Irrespective of the model you might feel more comfortable with, the key thing is to
reflect and understand the overall process and the key factors that underpin brand
equity. And more importantly how marketing activity assists in creating and building
brand equity.

Building brand equity.

Positive brand equity can help a company in a variety of ways. The most common is
the financial benefit which enables a company to charge a price premium for that
brand. For example, the Tiffany’s brand has enough equity that a price premium isn’t
just accepted, it’s expected.

Positive brand equity can also help to expand a company through successful brand
extensions and expansions. And not only can brand equity help increase sales and
revenues, but it can also help reduce costs. For example, there is little need for
awareness promotions for a brand that has deep, positive equity. Marketing budgets
can be more strategically invested in initiatives that will drive short-term results.
A company with strong brand equity is also positioned for long-term success
because consumers are more likely to forgive bumps in the road when they have
deep emotional connections and loyalties to a brand. Positive brand equity helps a
company navigate through macro-environmental challenges (as discussed earlier)
far more easily than brands with little or negative brand equity can.

Managing brand equity

Having established a brand and some hopefully strong brand equity there is need to
both sustain and add to brand equity.

Brand reinforcement - the brand is but one part of the total marketing mix and
therefore brand equity will also depend on the other marketing initiatives used by the
firm.  Reinforcement can be via marketing communication, in-store activity and
providing customers with messages about the benefits of the brand.  It also requires
the firm to have different approaches to conveying brand messages – market
conditions etc. change.

 Maybe consider how BMW manages its brand reinforcement activity.

Brand revitalisation – we see this often when a firm refreshes or implements

initiatives to ensure the brand and the brand promise is relevant to the current
market.  There are many examples of brand revitalisation in Australia and sometimes
this is done on a regular proactive basis –and sometimes in response to a major
crisis or after several years of decline.

BP (British Petroleum) is a very good example of a brand that has transformed from
being seen as a very conservative and strong, very British brand to now be seen as
a leading energy company – concerned about the environment.  Some may be old
enough to recall that BP’s logo was once a shield (very British) and now it is a prism
inspired flower.  And BP now means “beyond petroleum” – reflecting the firms
interest in many sources of energy.

Firms often modify logos etc. as part of this process and use different “tag lines” at
different times.  These tag lines can be used to convey different messages – but still
within the wider boundary of the core brand etc. Some firms  (like Coke) have a
stated policy of “refreshing” brands on a set time frame e.g. five years.