Chapter - 1

Brands and Brand Management

 Purpose
• To establish an image of a company in
customers eye.
• It gives a major edge in competitive market.
Background
 What is a Brand
• A brand is a “name, term, sign, symbol, or
design, or a combination of them, intended to
identify the goods and services of one seller or
group of sellers and to differentiate them from
those of competition.”
• The key to creating a brand, according to
definition, is to be able to choose a name,
logo, symbol, package design, or other
characteristics that identifies a product and
distinguishes it from others. These different
components of a brand that identify and
differentiate it are brand elements.
 Brands versus Products
• A product is anything we can offer to a market for
attention, acquisition and use to satisfy a need or want.
Thus, a product may be physical good like tennis
racquet or automobile; a service such as airline or
insurance company.
• We can define five levels to understand the meaning for
a product:
1. Core Benefit Level: Is the fundamental need or want that
consumers satisfy by consuming the products or services.
i.e. If we buy an air conditioner our core benefit will be
cooling and comfort.
2. Generic Product Level: Characteristics absolutely
necessary for its functioning but with no distinguishing
features. i.e. An air conditioning system has a sufficient
cooling capacity but do not save energy.
3. Expected Product Level: Characteristics that buyers
normally expect and agree when they purchase a product.
i.e. if we get parts warranty on a conditioning system.
4. Augmented Product Level: Additional product attributes,
benefits or related services that distinguish the product
from competitors. i.e. if we get a special discount on a
purchase.
5. Potential Product Level: All the augmentations and
transformations that a product might ultimately undergo
in the future. i.e. If an air conditioning system saves
energy for you and you get reasonable amount of bills
• In many markets most competition takes place at the
augmented product level, because most firms can
successfully build satisfactory products at expected product
level. i.e. Nokia failed and Samsung captured the market.
• Harvard’s Ted Levitt has argued “ the new competition is
not between what companies produce in their factories but
between what they add to their factory outlet in the form
of packaging, services, advertising, customer advice,
financing, delivery arrangements, warehousing and other
things that people value.
A brand is therefore more than a product, because it can have
dimensions that differentiate it in some way from other products
designed to satisfy the same need.