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v t e

The American Marketing Association defines a brand as a "Name, term, design, symbol, or any other feature that identifies one seller's good or service as distinct from those of other sellers." [1] A brand can take many forms, including a name, sign, symbol, color combination or slogan. For example, Coca Cola is the name of a brand make by a particular company. [2]The word branding began simply as a way to tell one person's cattle from another by means of a hot iron stamp. The word brand has continued to evolve to encompass identityit affects the personality of a product, company or service. It is defined by a perception, good or bad, that your customers or prospects have about you. [3] In the automotive industry, the terms marque[4] or make[5] are often used to denote a brand of motor vehicle. A concept brand is a brand that is associated with an abstract concept, like breast cancer awareness or environmentalism, rather than a specific product, service, or business. A commodity brand is a brand associated with a commodity. Got milk? is an example of a commodity brand.

Contents
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1 Concepts o 1.1 Brand awareness o 1.2 Brand elements o 1.3 Global brand 2 Benefits of global branding 3 Global brand variables o 3.1 Local brand o 3.2 Brand name 3.2.1 Types of brand names o 3.3 Brand identity o 3.4 Visual brand identity o 3.5 Brand parity 4 Expanding role of brand 5 Branding approaches o 5.1 Company name o 5.2 Individual branding o 5.3 Attitude branding and iconic brands o 5.4 "No-brand" branding o 5.5 Derived brands o 5.6 Brand extension and brand dilution o 5.7 Multi-brands o 5.8 Private labels o 5.9 Individual and organizational brands o 5.10 Crowdsourcing Branding o 5.11 Nation Branding (Place Branding & Public diplomacy) 6 History 7 See also 8 References 9 Bibliography

[edit] Concepts
Proper brand can result in higher sales of not only one product, but on other products associated with that brand. For example, if a customer loves Pillsbury biscuits and trust the brand, he or she is more likely to try other products offered by the company such as chocolate chip cookies. Brand is the personality that identifies a product, service or company (name, term, sign, symbol, or design, or combination of them) and how it relates to key constituencies: customers, staff, partners, investors etc.

Some people distinguish the psychological aspect, brand associations like thoughts, feelings, perceptions, images, experiences, beliefs, attitudes, and so on that become linked to the brand, of a brand from the experiential aspect. The experiential aspect consists of the sum of all points of contact with the brand and is known as the brand experience. The brand experience is a brand's action perceived by a person. The psychological aspect, sometimes referred to as the brand image, is a symbolic construct created within the minds of people, consisting of all the information and expectations associated with a product, service or the company(ies) providing them. People engaged in branding seek to develop or align the expectations behind the brand experience, creating the impression that a brand associated with a product or service has certain qualities or characteristics that make it special or unique. A brand is therefore one of the most valuable elements in an advertising theme, as it demonstrates what the brand owner is able to offer in the marketplace. The art of creating and maintaining a brand is called brand management. Orientation of the whole organization towards its brand is called brand orientation. The brand orientation is developed in responsiveness to market intelligence. Careful brand management seeks to make the product or services relevant to the target audience. Brands should be seen as more than the difference between the actual cost of a product and its selling price - they represent the sum of all valuable qualities of a product to the consumer. A brand which is widely known in the marketplace acquires brand recognition. When brand recognition builds up to a point where a brand enjoys a critical mass of positive sentiment in the marketplace, it is said to have achieved brand franchise. Brand recognition is most successful when people can state a brand without being explicitly exposed to the company's name, but rather through visual signifiers like logos, slogan's, and colors.[6] For example, Disney has been successful at branding with their particular script font (originally created for Walt Disney's "signature" logo), which it used in the logo for go.com. Consumers may look on branding as an aspect of products or services, as it often serves to denote a certain attractive quality or characteristic (see also brand promise). From the perspective of brand owners, branded products or services also command higher prices. Where two products resemble each other, but one of the products has no associated branding (such as a generic, storebranded product), people may often select the more expensive branded product on the basis of the quality of the brand or the reputation of the brand owner.

[edit] Brand awareness

Brand awareness refers to customers' ability to recall and recognize the brand under different conditions and link to the brand name, logo, jingles and so on to certain associations in memory. It consists of both brand recognition and brand recall. It helps the customers to understand to which product or service category the particular brand belongs and what products and services are sold under the brand name. It also ensures that customers know which of their needs are satisfied by the brand through its products (Keller). Brand awareness is of critical importance since customers will not consider your brand if they are not aware of it.[7]

There are various levels of brand awareness that require different levels and combinations of brand recognition and recall. Top-of-Mind is the goal of most companies. Top-of-Mind Awareness occurs when your brand is what pops into a consumers mind when asked to name brands in a product category. For example, when someone is asked to name a type of facial tissue, the common answer is Kleenex, which is a top-of-mind brand. Aided Awareness occurs when a consumer is shown or reads a list of brands, and expresses familiarity with your brand only after they hear or see it as a type of memory aide. Strategic Awareness occurs when your brand is not only top-of-mind to consumers, but also has distinctive qualities that stick out to consumers as making it better than the other brands in your market. The distinctions that set your product apart from the competition is also known as the Unique Selling Point or USP.

[edit] Brand elements

Brands are spreadthrough various elements[8]:

Name: The word or words used to identify the company, product, service, concept Logo: The visual trademark that identifies the brand Tagline or Catchphrase: "The Quicker Picker Upper" is associated with Bounty; "Can you hear me now" is an important part of the Verizon brand. Shapes: The distinctive shape of the Coca-Cola bottle or the Volkswagen Beetle are trademarked elements of those brands. Graphics: The dynamic ribbon is also a trademarked part of Coca-Cola's brand. Color: Owens-Corning is the only brand of fiberglass insulation that can be pink. Sounds: A unique tune or set of notes can "denote" a brand: NBC's chimes are one of the most famous examples. Movement: Lamborghini has trademarked the upward motion of its car doors. Smells: Scents, such as the rose-jasmine-musk of Chanel No. 5 is trademarked. Taste: KFC has trademarked its special recipe of 11 herbs and spices for fried chicken.

[edit] Global brand

A global brand is one which is perceived to reflect the same set of values around the world. Global brands transcend their origins and create strong enduring relationships with consumers across countries and cultures. They are brands sold in international markets. Examples of global brands include Facebook, Apple, Pepsi, McDonald's, Mastercard, Gap, Sony and Nike. These brands are used to sell the same product across multiple markets and could be considered successful to the extent that the associated products are easily recognizable by the diverse set of consumers.

[edit] Benefits of global branding

In addition to taking advantage of the outstanding growth opportunities, the following drives the increasing interest in taking brands global:

Economies of scale (production and distribution) Lower marketing costs

Laying the groundwork for future extensions worldwide Maintaining consistent brand imagery Quicker identification, recognition and integration of innovations (discovered worldwide) Preempting international competitors from entering domestic markets or locking you out of other geographic markets Increasing international media reach (especially with the explosion of the Internet) is an enabler Increases in international business and tourism are also enablers Possibility to charge premium prices Internal company benefits such as attracting and retaining good employees, and cohesive company culture

[edit] Global brand variables

The following elements may differ from country to country:

Corporate slogan Products and services Product names Product features Positionings Marketing mixes (including pricing, distribution, media and advertising execution)

These differences will depend upon:

Language differences Different styles of communication Other cultural differences Differences in category and brand development Different consumption patterns Different competitive sets and marketplace conditions Different legal and regulatory environments Different national approaches to marketing (media, pricing, distribution, etc.)

[edit] Local brand

A brand that is sold and marketed (distributed and promoted) in a relatively small and restricted geographical area. A local brand is a brand that can be found in only one country or region. It may be called a regional brand if the area encompasses more than one metropolitan market. It may also be a brand that is developed for a specific national market, however an interesting thing about local brand is that the local branding is more often done by consumers than by the producers. Examples of local brands in Sweden are Stomatol, Sknemejerier, etc.[9] [10]

[edit] Brand name

Relationship between trade marks and brand The brand name is quite often used interchangeably with "brand", although it is more correctly used to specifically denote written or spoken linguistic elements of any product. In this context a "brand name" constitutes a type of trademark, if the brand name exclusively identifies the brand owner as the commercial source of products or services. A brand owner may seek to protect proprietary rights in relation to a brand name through trademark registration and such trademarks are called "Registered Trademarks". Advertising spokespersons have also become part of some brands, for example: Mr. Whipple of Charmin toilet tissue and Tony the Tiger of Kellogg's Frosted Flakes. Local branding is usually done by the consumers rather than the producers. [edit] Types of brand names Brand names come in many styles.[11] A few include: Acronym: A name made of initials such as UPS or IBM Descriptive: Names that describe a product benefit or function like Whole Foods or Airbus Alliteration and rhyme: Names that are fun to say and stick in the mind like Reese's Pieces or Dunkin' Donuts Evocative: Names that evoke a relevant vivid image like Amazon or Crest Neologisms: Completely made-up words like Wii or Kodak Foreign word: Adoption of a word from another language like Volvo or Samsung Founders' names: Using the names of real people,and founder's name like Hewlett-Packard or Disney Geography: Many brands are named for regions and landmarks like Cisco and Fuji Film Personification: Many brands take their names from myth like Nike or from the minds of ad execs like Betty Crocker The act of associating a product or service with a brand has become part of pop culture. Most products have some kind of brand identity, from common table salt to designer jeans. A

brandnomer is a brand name that has colloquially become a generic term for a product or service, such as Band-Aid or Kleenex, which are often used to describe any brand of adhesive bandage or any brand of facial tissue respectively.

[edit] Brand identity

The outward expression of a brand - including its name, trademark, communications, and visual appearance - is brand identity.[12] Because the identity is assembled by the brand owner, it reflects how the owner wants the consumer to perceive the brand - and by extension the branded company, organization, product or service. This is in contrast to the brand image, which is a customer's mental picture of a brand.[12] The brand owner will seek to bridge the gap between the brand image and the brand identity. Effective brand names build a connection between the brand personality as it is perceived by the target audience and the actual product/service. The brand name should be conceptually on target with the product/service (what the company stands for). Furthermore, the brand name should be on target with the brand demographic.[13] Typically, sustainable brand names are easy to remember, transcend trends and have positive connotations. Brand identity is fundamental to consumer recognition and symbolizes the brand's differentiation from competitors. Brand identity is what the owner wants to communicate to its potential consumers. However, over time, a product's brand identity may acquire (evolve), gaining new attributes from consumer perspective but not necessarily from the marketing communications an owner percolates to targeted consumers. Therefore, brand associations become handy to check the consumer's perception of the brand.[14] Brand identity needs to focus on authentic qualities - real characteristics of the value and brand promise being provided and sustained by organizational and/or production characteristics.[15][16]

[edit] Visual brand identity

The visual brand identity manual for Mobil Oil (developed by Chermayeff & Geismar), one of the first visual identities to integrate logotype, icon, alphabet, color palette, and station architecture to create a comprehensive consumer brand experience. The recognition and perception of a brand is highly influenced by its visual presentation. A brands visual identity is the overall look of its communications. Effective visual brand identity is achieved by the consistent use of particular visual elements to create distinction, such as specific fonts, colors, and graphic elements. At the core of every brand identity is a brand mark, or logo. In the United States, brand identity and logo design naturally grew out of the Modernist movement in the 1950s and greatly drew on the principles of that movement simplicity (Mies van der Rohes principle of "Less is more") and geometric abstraction. These principles can be observed in the work of the pioneers of the practice of visual brand identity design, such as Paul Rand, Chermayeff & Geismar and Saul Bass.

[edit] Brand parity

Brand parity is the perception of the customers that some brands are equivalent.[17] This means that shoppers will purchase within a group of accepted brands rather than choosing one specific brand. When brand parity is present, quality is often not a major concern because consumers believe that only minor quality differences exist.

[edit] Expanding role of brand

It was meant to make identifying and differentiating a product easier. Over time, brands came to embrace a performance or benefit promise, for the product, certainly, but eventually also for the company behind the brand. Today, brand plays a much bigger role. Brands have been co-opted as powerful symbols in larger debates about economics, social issues, and politics. The power of

brands to communicate a complex message quickly and with emotional impact and the ability of brands to attract media attention, make them ideal tools in the hands of activists.[18]

[edit] Branding approaches

[edit] Company name
Often, especially in the industrial sector, it is just the company's name which is promoted (leading to[citation needed] one of the most powerful statements of branding: saying just before the company's downgrading, "No one ever got fired for buying IBM"). This approach has not worked as well for General Motors, which recently overhauled how its corporate brand relates to the product brands.[19] Exactly how the company name relates to product and services names is known as brand architecture. Decisions about company names and product names and their relationship depends on more than a dozen strategic considerations.[20] In this case a strong brand name (or company name) is made the vehicle for a range of products (for example, Mercedes-Benz or Black & Decker) or a range of subsidiary brands (such as Cadbury Dairy Milk, Cadbury Flake or Cadbury Fingers in the United States).

[edit] Individual branding

Main article: Individual branding Each brand has a separate name (such as Seven-Up, Kool-Aid or Nivea Sun (Beiersdorf)), which may compete against other brands from the same company (for example, Persil, Omo, Surf and Lynx are all owned by Unilever).

[edit] Attitude branding and iconic brands

Attitude branding is the choice to represent a larger feeling, which is not necessarily connected with the product or consumption of the product at all. Marketing labeled as attitude branding include that of Nike, Starbucks, The Body Shop, Safeway, and Apple Inc.. In the 2000 book No Logo,[21] Naomi Klein describes attitude branding as a "fetish strategy". "A great brand raises the bar -- it adds a greater sense of purpose to the experience, whether it's the challenge to do your best in sports and fitness, or the affirmation that the cup of coffee you're drinking really matters." - Howard Schultz (president, CEO, and chairman of Starbucks)

The color, letter font and style of the Coca-Cola and Diet Coca-Cola logos in English were copied into matching Hebrew logos to maintain brand identity in Israel. Iconic brands are defined as having aspects that contribute to consumer's self-expression and personal identity. Brands whose value to consumers comes primarily from having identity value are said to be "identity brands". Some of these brands have such a strong identity that they become more or less cultural icons which makes them "iconic brands". Examples are: Apple, Nike and Harley Davidson. Many iconic brands include almost ritual-like behaviour in purchasing or consuming the products. There are four key elements to creating iconic brands (Holt 2004): 1. "Necessary conditions" - The performance of the product must at least be acceptable, preferably with a reputation of having good quality. 2. "Myth-making" - A meaningful storytelling fabricated by cultural insiders. These must be seen as legitimate and respected by consumers for stories to be accepted. 3. "Cultural contradictions" - Some kind of mismatch between prevailing ideology and emergent undercurrents in society. In other words a difference with the way consumers are and how they wish they were. 4. "The cultural brand management process" - Actively engaging in the myth-making process in making sure the brand maintains its position as an icon.

[edit] "No-brand" branding

Recently a number of companies have successfully pursued "no-brand" strategies by creating packaging that imitates generic brand simplicity. Examples include the Japanese company Muji, which means "No label" in English (from "Mujirushi Ryohin" literally, "No brand quality goods"), and the Florida company No-Ad Sunscreen. Although there is a distinct Muji brand, Muji products are not branded. This no-brand strategy means that little is spent on advertisement or classical marketing and Muji's success is attributed to the word-of-mouth, a simple shopping experience and the anti-brand movement.[22][23][24] "No brand" branding may be construed as a type of branding as the product is made conspicuous through the absence of a brand name. "Tapa Amarilla" or "Yellow Cap" in Venezuela during the 80s is another good example of no-brand strategy. It was simply recognized by the color of the cap of this cleaning products company.

[edit] Derived brands

In this case the supplier of a key component, used by a number of suppliers of the end-product, may wish to guarantee its own position by promoting that component as a brand in its own right. The most frequently quoted example is Intel, which positions itself in the PC market with the slogan (and sticker) "Intel Inside".

[edit] Brand extension and brand dilution

The existing strong brand name can be used as a vehicle for new or modified products; for example, many fashion and designer companies extended brands into fragrances, shoes and accessories, home textile, home decor, luggage, (sun-) glasses, furniture, hotels, etc. Mars extended its brand to ice cream, Caterpillar to shoes and watches, Michelin to a restaurant guide, Adidas and Puma to personal hygiene. Dunlop extended its brand from tires to other rubber products such as shoes, golf balls, tennis racquets and adhesives. There is a difference between brand extension and line extension. A line extension is when a current brand name is used to enter a new market segment in the existing product class, with new varieties or flavors or sizes. When Coca-Cola launched "Diet Coke" and "Cherry Coke" they stayed within the originating product category: non-alcoholic carbonated beverages. Procter & Gamble (P&G) did likewise extending its strong lines (such as Fairy Soap) into neighboring products (Fairy Liquid and Fairy Automatic) within the same category, dish washing detergents. The risk of over-extension is brand dilution where the brand loses its brand associations with a market segment, product area, or quality, price or cachet.

[edit] Multi-brands
Alternatively, in a market that is fragmented amongst a number of brands a supplier can choose deliberately to launch totally new brands in apparent competition with its own existing strong brand (and often with identical product characteristics); simply to soak up some of the share of the market which will in any case go to minor brands. The rationale is that having 3 out of 12 brands in such a market will give a greater overall share than having 1 out of 10 (even if much of the share of these new brands is taken from the existing one). In its most extreme manifestation, a supplier pioneering a new market which it believes will be particularly attractive may choose immediately to launch a second brand in competition with its first, in order to pre-empt others entering the market. Individual brand names naturally allow greater flexibility by permitting a variety of different products, of differing quality, to be sold without confusing the consumer's perception of what business the company is in or diluting higher quality products. Once again, Procter & Gamble is a leading exponent of this philosophy, running as many as ten detergent brands in the US market. This also increases the total number of "facings" it receives on supermarket shelves. Sara Lee, on the other hand, uses it to keep the very different parts of

the business separate from Sara Lee cakes through Kiwi polishes to L'Eggs pantyhose. In the hotel business, Marriott uses the name Fairfield Inns for its budget chain (and Ramada uses Rodeway for its own cheaper hotels). Cannibalization is a particular problem of a "multibrand" approach, in which the new brand takes business away from an established one which the organization also owns. This may be acceptable (indeed to be expected) if there is a net gain overall. Alternatively, it may be the price the organization is willing to pay for shifting its position in the market; the new product being one stage in this process.

[edit] Private labels

With the emergence of strong retailers, private label brands, also called own brands, or store brands, also emerged as a major factor in the marketplace. Where the retailer has a particularly strong identity (such as Marks & Spencer in the UK clothing sector) this "own brand" may be able to compete against even the strongest brand leaders, and may outperform those products that are not otherwise strongly branded.

[edit] Individual and organizational brands

There are kinds of branding that treat individuals and organizations as the products to be branded. Personal branding treats persons and their careers as brands. The term is thought to have been first used in a 1997 article by Tom Peters.[25] Faith branding treats religious figures and organizations as brands. Religious media expert Phil Cooke has written that faith branding handles the question of how to express faith in a media-dominated culture.[26] Nation branding works with the perception and reputation of countries as brands.

[edit] Crowdsourcing Branding

These are brands that are created by the people for the business, which is opposite to the traditional method where the business create a brand. This type of method minimizes the risk of brand failure, since the people that might reject the brand in the traditional method are the ones who are participating in the branding process.

[edit] Nation Branding (Place Branding & Public diplomacy)

Nation branding is a field of theory and practice which aims to measure, build and manage the reputation of countries (closely related to place branding). Some approaches applied, such as an increasing importance on the symbolic value of products, have led countries to emphasise their distinctive characteristics. The branding and image of a nation-state "and the successful transference of this image to its exports - is just as important as what they actually produce and sell."[27]

[edit] History

The word "brand" is derived from the Old Norse brandr meaning "to burn." It refers to the practice of producers burning their mark (or brand) onto their products.[28] The Italians were among the first to use brands, in the form of watermarks on paper in the 1200s.[29] Although connected with the history of trademarks[30] and including earlier examples which could be deemed "protobrands" (such as the marketing puns of the "Vesuvinum" wine jars found at Pompeii),[31] brands in the field of mass-marketing originated in the 19th century with the advent of packaged goods. Industrialization moved the production of many household items, such as soap, from local communities to centralized factories. When shipping their items, the factories would literally brand their logo or insignia on the barrels used, extending the meaning of "brand" to that of trademark. Bass & Company, the British brewery, claims their red triangle brand was the world's first trademark. Lyles Golden Syrup makes a similar claim, having been named as Britain's oldest brand, with its green and gold packaging having remained almost unchanged since 1885. Another example comes from Antiche Fornaci Giorgi in Italy, whose bricks are stamped or carved with the same proto-logo since 1731, as found in Saint Peter's Basilica in Vatican City. Cattle were branded long before this. The term "maverick," originally meaning an unbranded calf, comes from Texas rancher Samuel Augustus Maverick who, following the American Civil War, decided that since all other cattle were branded, his would be identified by having no markings at all. Even the signatures on paintings of famous artists like Leonardo Da Vinci can be viewed as an early branding tool. Factories established during the Industrial Revolution introduced mass-produced goods and needed to sell their products to a wider market, to customers previously familiar only with locally-produced goods. It quickly became apparent that a generic package of soap had difficulty competing with familiar, local products. The packaged goods manufacturers needed to convince the market that the public could place just as much trust in the non-local product. Campbell soup, Coca-Cola, Juicy Fruit gum, Aunt Jemima, and Quaker Oats were among the first products to be 'branded', in an effort to increase the consumer's familiarity with their products. Many brands of that era, such as Uncle Ben's rice and Kellogg's breakfast cereal furnish illustrations of the problem. Around 1900, James Walter Thompson published a house ad explaining trademark advertising. This was an early commercial explanation of what we now know as branding. Companies soon adopted slogans, mascots, and jingles that began to appear on radio and early television. By the 1940s,[32] manufacturers began to recognize the way in which consumers were developing relationships with their brands in a social/psychological/anthropological sense. From there, manufacturers quickly learned to build their brand's identity and personality (see brand identity and brand personality), such as youthfulness, fun or luxury. This began the practice we now know as "branding" today, where the consumers buy "the brand" instead of the product. This trend continued to the 1980s, and is now quantified in concepts such as brand

value and brand equity. Naomi Klein has described this development as "brand equity mania".[21] In 1988, for example, Philip Morris purchased Kraft for six times what the company was worth on paper; it was felt that what they really purchased was its brand name.[33] Marlboro Friday: April 2, 1993 - marked by some as the death of the brand[21] - the day Philip Morris declared that they were cutting the price of Marlboro cigarettes by 20% in order to compete with bargain cigarettes. Marlboro cigarettes were noted at the time for their heavy advertising campaigns and well-nuanced brand image. In response to the announcement Wall street stocks nose-dived[21] for a large number of branded companies: Heinz, Coca Cola, Quaker Oats, PepsiCo. Many thought the event signalled the beginning of a trend towards "brand blindness" (Klein 13), questioning the power of "brand value."

Brand equity
From Wikipedia, the free encyclopedia Jump to: navigation, search Brand equity is the marketing effects and outcomes that accrue to a product with its brand name compared with those that would accrue if the same product did not have the brand name. Fact of the well-known brand name is that, the company can sometimes charge premium prices from the consumer .[1][2][3][4] And, at the root of these marketing effects is consumers' knowledge. In other words, consumers' knowledge about a brand makes manufacturers and advertisers respond differently or adopt appropriately adept measures for the marketing of the brand.[5][6] The study of brand equity is increasingly popular as some marketing researchers have concluded that brands are one of the most valuable assets a company has.[7] Brand equity is one of the factors which can increase the financial value of a brand to the brand owner, although not the only one.[8] Elements that can be included in the valuation of brand equity include (but not limited to): changing market share, profit margins, consumer recognition of logos and other visual elements, brand language associations made by consumers, consumers' perceptions of quality and other relevant brand values. "Brand equity is strategically crucial, but famously difficult to quantify. Many experts have developed tools to analyze this asset, but there is no universally accepted way to measure it." In a survey of nearly 200 senior marketing managers, only 26 percent responded that they found the "brand equity" metric very useful.[9]

Contents
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1 Purpose 2 Construction 3 Methodologies 4 See also 5 References

[edit] Purpose
The purpose of brand equity metrics is "to measure the value of a brand." "A brand encompasses the name, logo, image, and perceptions that identify a product, service, or provider in the minds of customers. It takes shape in advertising, packaging, and other marketing communications, and becomes a focus of the relationship with consumers. In time, a brand comes to embody a promise about the goods it identifiesa promise about quality, performance, or other dimensions of value, which can influence consumers' choices among competing products. When consumers trust a brand and find it relevant, they may select the offerings associated with that brand over those of competitors, even at a premium price. When a brand's promise extends beyond a particular product, its owner may leverage it to enter new markets. For all these reasons, a brand can hold tremendous value, which is known as brand equity." [9]

[edit] Construction
There are many ways to measure a brand. Some measurements approaches are at the firm level, some at the product level, and still others are at the consumer level. Firm Level: Firm level approaches measure the brand as a financial asset. In short, a calculation is made regarding how much the brand is worth as an intangible asset. For example, if you were to take the value of the firm, as derived by its market capitalizationand then subtract tangible assets and "measurable" intangible assetsthe residual would be the brand equity.[7] One highprofile firm level approach is by the consulting firm Interbrand. To do its calculation, Interbrand estimates brand value on the basis of projected profits discounted to a present value. The discount rate is a subjective rate determined by Interbrand and Wall Street equity specialists and reflects the risk profile, market leadership, stability and global reach of the brand.[10] Product Level: The classic product level brand measurement example is to compare the price of a no-name or private label product to an "equivalent" branded product. The difference in price, assuming all things equal, is due to the brand.[11] More recently a revenue premium approach has been advocated.[4]

Consumer Level: This approach seeks to map the mind of the consumer to find out what associations with the brand the consumer has. This approach seeks to measure the awareness (recall and recognition) and brand image (the overall associations that the brand has). Free association tests and projective techniques are commonly used to uncover the tangible and intangible attributes, attitudes, and intentions about a brand.[5] Brands with high levels of awareness and strong, favorable and unique associations are high equity brands.[5] All of these calculations are, at best, approximations. A more complete understanding of the brand can occur if multiple measures are used. Positive brand equity vs. negative brand equity Brand equity is the positive effect of the brand on the difference between the prices that the consumer accepts to pay when the brand known compared to the value of the benefit received. There are two schools of thought regarding the existence of negative brand equity. One perspective states brand equity cannot be negative, hypothesizing only positive brand equity is created by marketing activities such as advertising, PR, and promotion. A second perspective is that negative equity can exist, due to catastrophic events to the brand, such as a wide product recall or continued negative press attention (Blackwater or Halliburton, for example). Colloquially, the term "negative brand equity" may be used to describe a product or service where a brand has a negligible effect on a product level when compared to a no-name or private label product. Family branding vs. individual branding strategies The greater a company's brand equity, the greater the probability that the company will use a family branding strategy rather than an individual branding strategy. This is because family branding allows them to leverage the equity accumulated in the core brand. Aspects of brand equity include: brand loyalty, awareness, association (read more here), and perception of quality . Examples In the early 2000s in North America, the Ford Motor Company made a strategic decision to brand all new or redesigned cars with names starting with "F." This aligned with the previous tradition of naming all sport utility vehicles since the Ford Explorer with the letter "E." The Toronto Star quoted an analyst who warned that changing the name of the well known Windstar to the Freestar would cause confusion and discard brand equity built up, while a marketing manager believed that a name change would highlight the new redesign. The aging Taurus, which became one of the most significant cars in American auto history, would be abandoned in favor of three entirely new names, all starting with "F," the Five Hundred, Freestar, and Fusion. By 2007, the Freestar was discontinued without a replacement. The Five Hundred name was thrown out and Taurus was brought back for the next generation of that car in a surprise move by Alan Mulally.

In practice, brand equity is difficult to measure. "Because brands are crucial assets, however, both marketers and academic researchers have devised means to contemplate their value."[9] Some of these techniques are described in the "Methodologies" section below.

[edit] Methodologies
Brand Equity Ten (Aaker) "David Aaker, a marketing professor and brand consultant, highlights ten attributes of a brand that can be used to assess its strength. These include Differentiation, Satisfaction or Loyalty, Perceived Quality, Leadership or Popularity, Perceived Value, Brand Personality, Organizational Associations, Brand Awareness, Market Share, and Market Price and Distribution Coverage. Aaker doesn't weight the attributes or combine them in an overall score, as he believes any weighting would be arbitrary and would vary among brands and categories. Rather he recommends tracking each attribute separately."[9] Brand Equity Index (Moran) "Marketing executive Bill Moran has derived an index of brand equity as the product of three factors:"

"Effective Market Share is a weighted average. It represents the sum of a brand's market shares in all segments in which it competes, weighted by each segment's proportion of that brand's total sales." "Relative Price is a ratio. It represents the price of goods sold under a given brand, divided by the average price of comparable goods in the market." "Durability is a measure of customer retention or loyalty. It represents the percentage of a brand's customers who will continue to buy goods under that brand in the following year."[9]

Brand Asset Valuator (Young & Rubicam) "Young & Rubicam, a marketing communications agency, has developed the Brand Asset Valuator, a tool to diagnose the power and value of a brand. In using it, the agency surveys consumers' perspectives along four dimensions:"

"Differentiation: The defining characteristics of the brand and its distinctiveness relative to competitors." "Relevance: The appropriateness and connection of the brand to a given consumer." "Esteem: Consumers' respect for and attraction to the brand." "Knowledge: Consumers' awareness of the brand and understanding of what it represents."[9]

Brand Valuation Model (Interbrand and Brand Finance)

"Interbrand, a brand strategy agency, draws upon financial results and projections in its own model for brand valuation. It reviews a company's financial statements, analyzes its market dynamics and the role of brand in income generation, and separates those earnings attributable to tangible assets (capital, product, packaging, and so on) from the residual that can be ascribed to a brand. It then forecasts future earnings and discounts these on the basis of brand strength and risk. The agency estimates brand value on this basis and tabulates a yearly list of the 100 most valuable global brands."[9] The Royalty Relief approach of Brand Finance, an independent brand valuation consultancy, is based on the assumption that if a company did not own the trademarks that it exploits, it would need to license them from a third party brand owner instead. Ownership therefore relieves the company from paying a license fee (the royalty) for the use of the third party trademarks. The royalty relief method involves estimating likely future sales, applying an appropriate royalty rate to them and then discounting estimated future, post-tax royalties, to arrive at a Net Present Value (NPV). This is held to represent the brand value.[12] The independent consultancy publishes yearly lists by industry sector and geographic region as well as a top 500 global list.

Conjoint Analysis Marketers use conjoint analysis to measure consumers' preference for various attributes of a product, service, or provider, such as features, design, price, or location. By including brand and price as two of the attributes under consideration, they can gain insight into consumers' valuation of a brandthat is, their willingness to pay a premium for it.[9] Note: These customer satisfaction methodologies have not been independently audited by the Marketing Accountability Standards Board (MASB) according to MMAP (Marketing Metric Audit Protocol).

Brand architecture
From Wikipedia, the free encyclopedia (Redirected from Brand Architecture) Jump to: navigation, search Brand architecture is the structure of brands within an organizational entity. It is the way in which the brands within a companys portfolio are related to, and differentiated from, one another. The architecture should define the different leagues of branding within the organization; how the corporate brand and sub-brands relate to and support each other; and how the sub-brands reflect or reinforce the core purpose of the corporate brand to which they belong. According to Rajagopal and Sanchez Brand architecture may be defined as an integrated process of brand building through establishing brand relationships among branding options in the competitive environment. The brand architecture of an organization at any time is, in large measure, a legacy of past management decisions as well as the competitive realities it faces in the marketplace[1].

Contents
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1 Types of brand architecture 2 Strategic Considerations 3 See also 4 References

[edit] Types of brand architecture

There are three key levels of branding:

Corporate brand, umbrella brand, and family brand - Examples include Virgin Group and Heinz. These are consumer-facing brands used across all the firm's activities, and this name is how they are known to all their stakeholders consumers, employees, shareholders, partners, suppliers and other parties. These brands may also be used in conjunction with product descriptions or sub-brands: for example Heinz Cream of Tomato Soup, or Virgin Trains. Endorsed brands, and sub-brands - For example, Nestle KitKat, Cadbury Dairy Milk, Sony PlayStation or Polo by Ralph Lauren. These brands include a parent brand - which may be a corporate brand, an umbrella brand, or a family brand - as an endorsement to a sub-brand or an individual, product brand. The endorsement should add credibility to the endorsed sub-brand in the eyes of consumers. Individual product brand - For example, Procter & Gambles Pampers or Unilever's Dove. The individual brands are presented to consumers, and the parent company name is

given little or no prominence. Other stakeholders, like shareholders or partners, will know the producer by its company name. A recent example of brand architecture in action [2] is the reorganization of the General Motors brand portfolio to reflect its new strategy. Prior to bankruptcy, the company pursued a corporateendorsed hybrid brand architecture structure, where GM underpinned every brand. The practice of putting the "GM Mark of Excellence" on every car, no matter what the brand, was discontinued in August, 2009.[3] In the run-up to the IPO, the company adopted a multiple brand corporate invisible brand architecture structure.[2] The company's familiar square blue "badge" has been removed from the Web site and advertising, in favor of a new, subtle all-text logo treatment.[4]

[edit] Strategic Considerations

Deciding what strategy to pursue in structuring the company brand portfolio depends on the answer of a number of strategic issues. According to the article Brand Architecture: Strategic Considerations, the issues to consider include:[5]

Audience Diversity What are the target segments for your brand? Is the brand focused on just one audience or must it appeal to many? Brand Elasticity How far can each of the brands stretch to cover different products and markets? Harley Davidson made a classic blunder applying their brand to wine coolers. Product/Service Offerings How are other brands in the portfolio positioned and targeted? Are some of your brands complementary, competitive or incongruent? Competitive Context What are competitive branding practices? How do customers view the marketplace? Do your brands help you stand out and grab market share? Brand Equities Do you have brands with a particular following or a unique heritage or equity must be carried forward? Geographic Needs How consistent are needs/preferences across cultures and markets? Strong local brands might not work in other countries. Not every brand can travel. Organizational Structures Who is accountable for branding practices and standards? What are the political realities behind brands in your portfolio? Ownership Does the organization have legal control over its brand? Youll have less leeway with licensed brands. Sources of Growth What businesses and brands are expected to drive future growth for your company? Are they helping you pursue your strategy? Purchase Criteria How do people buy your products? Do they ask for products by brand name or do they ask for a generic name or your company brand name? Do your brands make buying easier? How much do people want or need your brands? Brand Performance How do brands perform against desired attributes? Is their positioning clear and effective? Brand Role What is role of brand in fulfilling the business model? How important is the brand in driving awareness or creating loyalty? Channels What channels and distribution methods are available and how are they used across the brand portfolio?

Company Specific Issues What considerations are specific to your company or industry? What might be technically correct might not be feasible in the reality of your company. Sometimes theory has to bow to practicality.

A brand can move from creating affinity to inspiring awe and respect,

What makes a Sachin Tendulkar [ Images ] and Roger Federer [ Images ] connect with many
of their fans? At one level, they are achievers; they are well known stars and have both fame and fortune, things that many youth and young adults desire and strive for.

But digging deeper, they also embody the spirit of excellence, the pursuit of perfection, and they represent a performance level that most can't hope to achieve. What makes these brands tick is their ability to drive awe in their fans. What made Gandhi and Nelson Mandela [ Images ] the legends they are? They were freedom fighters who delivered independence for the nation they represented. They espoused philosophies that were different from what were then prevalent - they were square pegs in round holes. But what most admirers of these two actually find interesting is that they were able to mobilise millions of people to follow what they preached and get them to commit to the cause by action. They started movements - and they did this by inspiring people, by tapping into a higher goal that people wanted to achieve and by galvanising them. Not surprisingly, they were and are respected figures. Is there something instructional for product brands - something to learn from these towering personalities? In the more mundane world of product branding, two brands are interesting to revisit and study. Apple and Steve Jobs have given the market a slew of products known for innovation and redefining markets. At one level, it helps owners to feel trend-setting and ahead of times every time they pick up an Apple product. It also delivers delightful product experiences. However, dig deeper and there is something very reverential many Apple aficionados feel about the brand and its creator that being part of something created by the brand is a reward in itself.

For millions who can perhaps never hope to achieve anything close to what Apple does, owning the product is the closest to getting there. Turn back to the 90s and rewind to Benetton's path-breaking campaign of "United colours" that attempted to raise the issue of racial discrimination and bring colours together. It was built on a thought and philosophy no one could dispute. It took the brand beyond fabric, design and colours. It made buyers feel part of a movement that was evangelising the need for an equal world. Both brands went beyond brand attributes and benefits - functional and emotional - to stand for higher values and causes that the consumer could look up to or join. This is perhaps the next frontier for brands. We have now seen three decades of big-time, conscious brand-building; two decades of media proliferation and clutter and two decades of consumerism. The result is clearly emerging categories are getting commoditised. Advertising during this period has become more engaging and entertaining. There is perhaps need to do more in today's environment to gain traction with consumers. Iconic brands now have an opportunity to go beyond affinity and preference-building to engage with consumers more deeply by owning philosophies and causes that resonate with the consumers at a higher level. This does not necessarily mean taking on corporate social responsibility activities or doing social good. An insurance brand can espouse the cause of safer and healthier living; a grooming brand can promote the cause of a beautiful world (there were strains of this idea in Allen Solly's "I hate ugly" campaign of last season); and a white goods brand could encourage people to live life on their own terms - unrestrained - as a fridge or a microwave helps in providing fresh food, anytime! When the cause is linked to the product or service, the value of the brand gets enhanced and it moves the brand from having a role in the consumer's life to making a difference in the larger world. And this gives it a stature that goes beyond benefits and brand personality. And if the cause is large or arousing, it can easily inspire awe, respect and enlistment! Lifebuoy Swastya Chetna is an initiative run by Unilever in rural Indiato educate consumers on the value of personal hygiene. At one level, it positions the brand as a germ-fighter that helps prevent dysentery - a common rural problem of bad hand-wash habits. At another level, it moves the brand from being a hygiene brand to a health brand and makes it espouse the cause of a healthier India [ Images ] by enabling the consumer with one good habit to reduce the chances of illness. And this creates connection with the brand at a higher level -

almost governmental and developmental in nature - and makes it a social benefactor for those who are striving to live a better life in tough conditions. Tata Tea's [ Get Quote ] recent "Jaago Re" campaign is another interesting example in this context. It has broken away from tea attributes of strength, taste and freshness and pitched itself "laterally" on a tea benefit of awakening. But awakening has taken up the cause of opening the eyes and minds of an apathetic consumer group to both their responsibilities and the social ills around them (voting and corruption). And thus starting a movement. Both ideas have germs (or gems) of being able to make the brand transcend from propositions to philosophies. Making this transition has its advantages. At a marketing level, it provides stimulus to get media editorial to talk about the cause and the movement and thus it becomes a multiplier in itself. With the emergence of digital media, buzz gets easier to generate and spread. In a hierarchical culture like India's, it makes the brand look like a leader and benefit from the respect it evokes. And above all, it helps provide the consumer with a fresh perspective of the brand and make it stand out from a clutter - where many brands are still trying to outdo each other at a product level. Of course, it is concomitant that the product delivers at the base level, competitively and to complete consumer satisfaction. And the brand's history should give it permission to carry the philosophy. India is a developing economy. However, in many categories, India is as crowded as the most developed markets in the West. It's time for brands to reappraise their cause-and-effect formula and move from pure affinity-building. Something worth thinking about.

Managing Luxury Brands in Recession

In the earlier article 'Luxury consumption: will it really be affected by recession?' I provided my perspective on luxury consumption and effects of recession on it. I stated why there will be little affect of recession on luxury consumption. Furthermore, in a sequel to that article I wrote another article titled 'consumption tendencies in recession: early evidence' wherein the propositions I had forwarded were supported by consumers representing various countries and industries. Respondents in my exploratory study confirmed the relatively lesser effect of recession on consumption pattern with regard to luxury goods. However, they also raised concerns as to companies should not be complacent about it and must take actions to offset the relative decrease in spending. In this article, I will focus on how and what actions companies should take to gain from the recession. 1. Spend on your brand During a vibrant and growing economy consumers spend freely. Therefore, having an unclear brand position, while not optimum, is not as risky as during a recessionary period. In growth times, the brands weakness in the marketplace is less obvious, as consumers tend to be more forgiving and are not so price-conscious. However, when times get tough, consumer spending habits change dramatically. With negative news percolating from all media avenues the consumption fear sets in and they require much further motivation for spending. In recessionary times, consumers, not only spend less overall, but they become far more selective in how they spend. They gravitate away from brands that fail to provide a clear, meaningful, relevant and emotional engagement. Conventional wisdom suggests that in times of recession it is better to tighten the belt and cut costs and most companies immediately cut their marketing and branding efforts. However, this is where the opportunity beacons. When others are cutting their spending and loosing the emotional engagement with customers, it will pay in the longer term to spend on the brand. 2. Spend on brand relevancy The brand spend doesn't always mean monetary spend in every case. It is about generating a buzz around the brand and with the present day technology such efforts can be choreographed much easily than one can think. However, a word-of-caution for those ever so enthusiastic marketers. While creating and opening new communication avenues understand the limitations of it and the consumer engagement process. History of such communications is littered with companies overdoing it and in turn failing to become relevant. With luxury brands, relevance is an extremely important issue and therefore, one must move with caution. However, recession is the best time to build relevance and such relevance will stick for long-term. 3. Avoid the SALE mentality The increasing wall-street driven short-term focus to outperform competitors everyday is another pitfall associated with most marketers. There is not a single firm in the world which can ever do that. Remember that proverb 'every dog has its day'. This is how simple it is. You cannot outperform the market everyday and every time. It catches up on you. In recession times short-term focused marketer go on sales promotion overdrive. This has a direct impact on the brand erosion and consumers get confused as to what the brand stands for.

Instead of sales promotion spend on engagement. Make your brand relevant. Cement the position of your brand in the customers' minds. Stop the sale mentality. However, simple and logical this may sound, most marketers who are continuously involved in operational thinking miss this and kill their beloved (mostly by the consumers) luxury brands.

STOP. THINK. ACT.

Make the Recession Work for Your Brand

As the economic cycle spins, marketers look forward to the economic highs and dread inevitable recessions. When the economy goes sour, how do brands stay alive? During an economic slump, advertising budgets tend to be the first item cut. But history strongly suggests advertising budgets should be increased during a recession. Cutting marketing and sales budgets during recessionary periods changes long-term results. A key reason is that when advertising noise decreases, the voice of those still talking sound that much louder. When the competition stops or reduces their advertising efforts, its a prime opportunity for your brands message to be heard. Since your message is one of the few messages reaching customers, the odds of success are multiplied. American Business Press, in its book How Advertising in Recession Periods Affects Sales, states: The findings of the six recession studies to date present formidable evidence that cutting advertising appropriations in times of economic downturns can result in both immediate and long-term negative effects on sales and profit levels. The Buchen Agency measured the effects of advertising for business-to-business marketers through successive recessions in 1949, 1954, 1958 and 1961. They found that not only sales and profits dropped off for those companies that cut their advertising, but in addition, when the recovery came about, these same companies also lagged behind those who didnt cut back. In good times, marketing is important, in bad times, its vital. During tough times, customers look for specific qualities in a brand such as value. When customers are in need, satisfy the need. During a recession market dynamics change drastically. The key is knowing what your customers need, not what they want. Here are some simple guidelines for successful recessionary marketing: Focus on Branding * Its safe to assume customers will be price conscious during a recession. Therefore, its normal to assume that before making decisions, customers will do more shopping around than usual. For this reason, marketers must focus on ways to make their brands stand out from the rest and address the customers doubts. Brand messages should focus on practical uses of the product and demonstrate how customers are getting high quality for a low price (value). Establishing a system of feedback for customers will also help to distinguish your product. The key to successful recessionary marketing is emphasizing value. During an economic boom customers are much more likely to pay high prices. When times are bad customers are much more careful with their money. So marketers must focus on different aspects of their products. Focus on Customers * During a recession marketers need to focus on current customers, not just new ones. The assumption that any business is good business is not the case here. The best prospect is a current customer.

Acquiring new customers is five times more costly than retaining existing ones. Bad times can be used to focus on existing customers and turning them into loyal customers. That can be accomplished by researching customer needs and the ability of your product (and competitors products) to meet these goals. Marketing Focus * During a recessionary period, marketers should focus on the strong points of their brands and align them with their customers needs. A comprehensive marketing plan can help to position brands and to capture and maintain loyal customers and profitability. A long and objective look must be taken at your brands current marketing activities, focusing on those with greater potential. Recessions are never desirable, but they are inevitable. Using the right marketing strategy during tough times is the best way for your brand to survive. Importantly, dont decrease advertising activity. Get to know your customers and think of new ways to create value in your brandand to distinguish your brand from others

Why You Must Keep Marketing Through The Recession

Today, Ive decided I am not going to participate in the recession. Nope, not going to do it. Everyone is talking about the pending economic doom and granted, its not looking rosy out there, but, Ive decided that for my own health and my clients health I am going to make decisions based upon possibilities rather than fearing the future. Thats why marketing during a recession is critical. Those businesses that do not market in a recession will be a victim of its wrath. Furthermore, I am convinced the best ideas and most creative strategies are born out of necessity because it causes people to get even more creative and inventive in ways to reach their customers and to stretch a dollar. Still not convinced? Heres five reasons why marketing during a recession is a good idea: 1. Your competitors will be pulling back their efforts, as a result your business can increase market share. 2. Not everybody is out of a job or hurting despite the bad economic news. The remaining people still have needs and more importantly money to spend. 3. Remember its a Recession NOT a Depression. Most recessions are over in about 1 year. 4. Better prices from media outlets, direct mailers and publications. Why? Their business is down so theyll be willing to deal to get your business so be prepared to negotiate. 5. Youll get more business on the other side of the recession when its over. The bottom line: Defy logic and ramp up your promotional efforts during this recession and vow: I am not going to participate in this recession.

Branding seems to lose its vigor during recession. People tend to buy base on logic and needs, rather than impulse or perceptions. Therefore, you have to maintain or improve the kind of value, property, and benefits that your product promises its consumers. This is something that you must not lose focus on in your branding and marketing efforts, but its significance become more evident during times of recession. If you want to add more value to your brand to make it better able to withstand the challenges of a suffering economy, here are areas of your branding system that must be given focus on: During recession, most businesses would tend to cut back on their marketing efforts and investments. On the contrary, this is the time wherein you need to strengthen your marketing efforts. Create more aggressive marketing programs to be able to capture a bigger share of the market. Assert yourself on consumers largely affected by recession by offering better value on your products. Your advertising campaign must highlight quality, economic benefits, and real benefits as opposed to appeal to their superficial concerns. Helping Your Brand Survive The Recession When recession has hit the consumers, buying becomes a less desirable practice. This will largely impact your business' efforts and this is made worse by the intensity of competition amongst various similar businesses. Try using the following practices to keep your business thriving: 1.) Never change your brand identity. Doing so will reduce the trust you have built on the customers and will also ruin your reputation. Merely try to restructure the messages you are trying to deliver but make sure that it stays within the context of your basic brand identity. 2.) Utilize this time to appeal to your customer's needs by performing a more thorough market research. This will produce an impression that you are concerned about their needs and are seeking for ways to deliver that. 3.) If your business' products are mostly high-end, do not simply revert to dropping prices. Instead, try improving the value and quality of your products so that customers will have a better quality spending habit. 4.) Be open to potential new customers. In times of recession, people are in the process of re-evaluating their spending habits. This is your opportunity to come into the picture and offer your business as a possible solution. Ensuring Brand Stability Consumers change their buying patterns during recession, but business owners must remain committed with their branding strategies. However, you do have to make slight and appropriate changes though, such as increased sensitivity to this new buying attitude exhibited by consumers. During times of

recession, you have to stay committed in helping your customers attain quality service and products that add more value to their money. This is your winning formula. And with increased dedication to your business brand, you will also increase the loyalty of your patrons.

1 inShare

Advertising during recession

Guest post by: Manik Kinra

Article Overview: The article is on advertising & how advertising is not a expense but investment

Advertising during recession

With most companies feeling the heat of reducing revenues and eroding net worth, one of the first things that CEOs decide to save money is reduce the advertising budget. Now this primarily depends on whether the company views Advertisements as expense or investment. But to me recession provides a wonderful opportunity for companies. Now consider the few myths that most CEOs have; Myth 1 # All the companies are reducing the advertising budgets and hence the competition doesnt demand doing so much of advertising. Wrong This is just the right time for you to take charge and go one up against your competition and so if your competition is not doing advertising during recession you have an opportunity Myth 2 # People dont buy much during recession and hence advertising wouldnt reap in the benefits. Wrong People dont buy much during recession and hence you need to do more aggressive advertising to get people to buy. Also some of the recent studies show that recessions have only a 2% reduction in peoples disposable income but despite that people tend to sit back and maintain liquidity. Worse is that companies dont realize that by luring people through advertising they can get them to buy your product; even during the recession. Study done by McGraw-Hills showed that a 13 page advertising during recession increased companys recognition from 32 to 45%. For 1980-85 recession all those companies which did not reduce their advertising budgets increased sales by 16 to 80% & most important was the fact that the increase in sales was not a temporary thing but permanent. So though the question of advertising budgets during recession is something which has been asked during every recession and studies have shown that companies who did reduce suffered more and who maintained or increased did smart business, not many have gone ahead and gone with the same or more advertising. In 1975 GM and Ford used two different strategies and where GM kept with the same budget and Ford reduced budgets so while GM increased the sales and Fords sales went down by 14%. Now that leaves me with a question If we continue or increase our advertising budget during the recession wouldnt that lead to controlling of recession?

he truth is, we've always overestimated the power of branding while underestimating consumers' ability to recognize quality. When brands first became important in the US a century ago, it was because particular products - Pillsbury flour or Morton salt - offered far more reliability and quality than no-name goods. Similarly, many (and arguably most) of the important brands in American history - Gillette or Disney - became successful not because of clever marketing, but because they offered something you couldn't get anywhere else. (Gillette made the best razors; Disney made the best animated movies.) Even Nike first became popular because it made superior running shoes. Marketers looked at these companies and said they were succeeding because their brands were strong. In reality, the brands were strong because the companies were succeeding. Over time, certain brands came to connote quality. They did provide a measure of insurance which in turn made firms less innovative and less rigorous. (Think of the abominable cars General Motors, Ford, and Chrysler made in the late 1960s through the 1970s - remember the Pinto? - in part because they assumed that they had customers for life.) That sense of protection is eroding in industry after industry, and instead of a consumer economy in which success is determined in large part by name, it's now being determined by performance. The aristocracy of brand is dead. Long live the meritocracy of product. I offer three ways to do this. First, there's always good news in bad times. A standard approach in this situation is to address consumers' problems. And people always have problems. The fact is we rarely know what we want, but we have no trouble pointing out our difficulties. For example, no one knew they wanted an airbag, but everyone agreed they wanted safer cars. It's therefore important to ask yourself what sort of problems are consumers facing during this economic recession? There are many. People have had to cut back on travel and if they can afford to still take a holiday, well, it's much cheaper to keep it local. Which might explain why those French perfumes are still selling--they offer a whiff of Paris. And if you can no longer afford expensive dining, you can always supplement your home-cooked meal with an afterdinner Lindt chocolate. We're increasingly reluctant to invest in the share market, but we're happy to put our money in gold. Convert problems into assets for your brand. Second, add a practical dimension to an irrational decision. No matter how much money you may have in the bank, or how secure your employment may be, it's now fashionable to save your money and buy everything at a discount. What can a brand owner do? Particularly in light of the fact that a discounted brand typically takes seven years to recover! The answer is simple. Add a practical dimension to the equation. One only needs to look at a hardwearing boot like Willeys to see that this manufacturer of sturdy reliable footwear is clocking up big sales. A well-designed jacket, that just happens to be reversible, could tip the balance in favor of the consumer who perceives they're getting two coats for the price of one.

The fact may be that the consumer is buying the jacket because they love the design--yet in recession times, the practical dimension is the deal maker. Third, you have to systematically remove fear. Hyundai did it. And a stream of new banks are doing it. Both have succeeded in identifying why consumers are reluctant to spend. Once this is understood, then you can harness it and build a better product by addressing the fear and finding a way to eliminate it. You sales may be down. But do you know why? People are certainly buying less, and explanations like, "Well, there's a recession going on out there," are not helpful. What's important is to understand the fundamental role of fear, and then turn it around to strengthen your brand. Some of the world's most enduring grocery brands were built on the back of the Great Depression. Each one turned the threat into an opportunity.