Leveraging secondary brand associations to

build brand equity.

A presentation by:
Varqa Shamsi Bahar
Introduction: What is Leveraging?
• When the brand “borrows” some brand
knowledge and depending on the nature of those
associations and responses, some brand equity.
• This indirect approach to building brand equity is
leveraging secondary knowledge for the brand.
• Secondary brand knowledge is important to
create strong, favorable and unique associations.

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Secondary sources of brand knowledge

1. Companies (through branding strategies).

2. Country of brand of origin (identification of product
origin).
3. Channels of distribution (through channel strategy)
4. Other brand (through co-branding)
5. Characters (through licensing)
6. Spokespersons (through endorsements)
7. Events (through sponsorships)
8. Other third party sources (through awards or reviews).

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Conceptualizing the leveraging process

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 Creation of a new brand association

• By making a connection between the brand and

other secondary associations, consumers form a
new mental associations.
e.g.1 If a new car brand is made in Germany?
e.g.2 If the daily star gives a good review about your
restaurant?
• Hence, it gives the consumers a parameter to
evaluate the product/service – link explanation
with cognitive maps (new linkages created).
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 Effects on existing brand knowledge

• Linking the brand to some other entity may not only

create new brand associations but also affect existing
brand knowledge by strengthening or modifying
current linkages.
• “What is true for the entity, must be true for the
brand”.
• e.g. If Amitabh Bachan says to trust cadbury again?
(linkage being modified).
• Doctors recommending Colgate (trust association being
strengthened).
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 How Leveraging Occurs – the process.

• Awareness and knowledge of the entity

– Do they know about the entity?
– Do they hold strong, favourable & unique associations?
• Meaningfulness of the knowledge
– Is the knowledge relevant and meaningful for the brand?
– Does it have connection to the brand?
• Commonality factor of the associations being leveraged
• Also the significance of product category
• Transferability
– How strongly will this knowledge actually be linked to the
brand?

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Leveraging the association of the
“Company”

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 Guidelines

• Company Image should always be maintained through

PR activities. Consumers will be loyal to brands from a
company they have favorable perceptions about.
• The corporate brand should have a brand mantra also.
• E.g. Nestle’s brand mantra only allows it to be in the
food industry. “Good Food, Good Life”.
• E.g. Hewlett-Packard’s brand mantra allows the
corporate brand to be within “tech products”.

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The Company’s association

New
product

Instant
acceptance

Corporate
Brand

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Co-branding

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 What is Co-branding?

• In co-branding two or more well known brands

are combined into a joint product or marketed
together in some fashion.
• Co-branding reduces the cost of product
introduction because it combines two or more
well known brand images and speeds adoption.
• Unsatisfactory product performance may have
negative impact on the all the brands involved.

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Crest with Scope Outlast

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 Fiat - Mattel
• To celebrate Barbie’s 50th anniversary, Mattel and Fiat joined forces to create the
500 Barbie. The car comes in nail-polish-pink and features lip gloss in the glove
compartment.

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 Michael Jordan - Nike
• Nike created the first pair of Air Jordans in 1984. It has since
produced 23 versions, with a price tag of more than $100 per
unit.

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Ingredient Branding

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 What is ingredient branding?

• Ingredient branding is a special case of co-

branding. It creates brand equity for materials,
components, or parts that are necessarily
contained within other branded products.
• Ingredient brands are a signal of quality. For
example: Diet Coke Sweetened with Splenda.
• Ingredient brands can even become a necessity
for the category. For example: Visa ingredient
brand.
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Cocacola sweetened with Splenda

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Powered by Visa

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 Betty Crocker – Hershey
• Betty Crocker, the brand introduced in 1921 and owned by General Mills, is
the queen of partnerships. The company has combined the likes of Hershey
to create easy-to-make food products

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Case Study: “Intel Inside” Ingredient Brand

Ingredient brand become industry standards and

consumers will not want to buy any product if it
doesn't have that specific ingredient.

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Leveraging the association of country
of origin

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 What is COO all about?

The country from which the brand originates may

be linked to the brand and generate secondary
associations.
• “The study of Country of Origin effects seeks to
understand how consumers perceive products
originating from a particular country”(Czinkota
and Ronkainen,1995)
• Most people understand it as the ‘Made in’
Label.
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 What is COO all about?

• However there is more to COO than a ‘Made in’

Label; Many products are now hybrid and it can
be difficult to determine their COO.
• Exported in A
• Designed in B
• Manufactured in C
• Assembled in D

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• Every country has a strong equity in a specific
product category.
• Hence, brands in those specific product
categories usually leverage strong favorable
and unique associations of the COO.

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 France

Images: Luxury and Beauty

Products: Wine, Clothing,

Perfume and Cosmetics

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 Japan

Image: Cutting edge, quality,

Futuristic.

Products: technology and home entertainment,

cars.

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 Switzerland

Images: Rich in Tradition and Quality

Product: Chocolates and Watches

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 Germany

Image : Reliability, Durability

and Quality

Product: Cars, Tools and

Machinery

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 Italy

Image: Design, Quality

and Beauty

Products: Leather, Food

and Fashion

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 Some stereotyped perceptions

• “Heaven” is where the cooks are French, the

mechanics are German, the policemen are
English, the lovers are Italian, and it is all
organized by the Swiss.

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 Guessing Game

• Gucci
• Levi’s Jeans
• Rolex
• Ferrari
• Walton
• Dr. Pepper
• Chanel perfume
• Barilla Pasta
• Kikkoman soy sauce
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 COO and Brands

• Brand is embedded in country of origin studies; brands from a

country with a more favorable image generally have a better chance
to establish more positive brand image than brands that are not.
+VE COO LEADS TO STRONGER BRAND EQUITY.
• Research has found that a highly regarded brand name can help
alleviate the negative effect of a poor COO image (Cordell 1993,
Erickson et al., 1984). STRONGER BRAND EQUITY WILL NULLIFY –VE
COO.
• Brand is generally of greater importance than COO in evaluating
low-involvement products. A renowned brand name for a low-
involvement product will dilute the impact of a negative COO image.
HABITUAL BUYING DECISION, VARIETY SEEKING BUYING DECISION.
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 Origin as an identity
• Origins of the brand are more important than who the
owner becomes latter in life.
• Lamborghini is owned by German-VW, yet it keeps its
Italian identity.
• Rolls-Royce is now owned by German BMW, it still is
associated with English luxury.
• Just like a child, the first years are the most important
for his/her identity.
• Interesting fact: Research has showed that only 8% of
the VW owners knew that VW is manufactured in
Brazil.
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 Some precautions of leveraging COO as a
secondary association
• Customer awareness of COO may be quite limited. IN THESE
CASES DO NOT LEVERAGE COO ASSOCIATIONS.

• Country of origin cannot be a differentiating factor among

competing producers from the same country
VW v BMW
IBM v Apple

• “Country image cannot be controlled at the firm or industry level”.

•  Effects of Ethnocentric individuals who tend to view their group

as superior to others (Shimp and Sharma, 1987).
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Channels of Distribution/marketing
intermediaries

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 Marketing Intermediaries enhance brand
equity
• Retail stores can indirectly affect brand equity
through a “image transfer” process.
• Retailers/wholesalers/supermarkets have their
own image which is transferred onto the
brands that they sell in their stores.

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Philip Van Heusen covers a wide range of prices at different retail outlets. And
interestingly, at different retail outlets different branded clothing lines are sold.
Discussion: Why different brands are created/launched for different retail stores?
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 access

Price and
Promotions

Store
Retailer Atmosphere
Image

Cross
Category
Assortment

Within
category
assortment 44
 Retailer’s Brand Image dimensions
• Access: The location of the store. How easily is it accessible.
• Store Atmosphere: The interior design, the lighting, the color,
the music, the crowd can influence how much time consumer
spends and how much money they spend at a store.
• Price and promotion: Some prefer discounts, some prefer
more value which justifies higher prices, some prefer EDLP.
• Cross Category Assortment: breadth of different products
offered for convenience and ease of shopping.
• Within Category Assortment: number of brands being sold
under each product category. It gives consumers more choices.

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 Licensing

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 What is licensing?

• Licensing Involves contractual arrangements

whereby firms can use the names, logos,
characters, and so forth of other brands for
some fixed fee.
• Its “renting” another brand to contribute to the
brand’s equity of its own product.
• Discussion: You are a clothes manufacturer. You
license the brand “CK”.

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Celebrity Endorsement

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 Why utilize Celebrities?

• Celebrities can enhance brand equity.

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 Potential problems

1. Celebrity can endorse many brands. So may be

seen as opportunistic/commercial and insincere.
So the endorser loses its effectiveness.
e.g. Michael Jordan endorses Nike, Gatorade sports
drink, Bijan perfume, Hanes underwear,
Mcdonalds, MCI telecommunciations…and the
list goes on.
• Some brands tie up deals so that the endorser
cannot endorse any other brand.
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 Potential Problems

2. There should be a reasonable match between

the celebrity and the product. So that the
associations can be transferred from the
endorser to the brand.

3. Celebrity endorser can get into trouble or lose

popularity, diminishing their marketing value to
the brand.

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53
 Potential Problems

4. Consumers are smart – they know that the celebrities

the brands are employing don’t even use the
products…they are only doing it for the money.

5. The attention goes to the celebrity while attention

towards the brand is minimized. So consumers
remember the celebrity and not the brand. E.g. Pepsi
dropped Britney’s Spears and Beyonce (We will rock
you). E.g. Chrysler Pacifica and celine dion – sales of
her CDs increased! But not the sales of the car!!
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 Guidelines for celebrity endorsement

1. Chose a well known celebrity which will enhance the

awareness of the brand.
2. Choose a celebrity with strong, favorable, and unique
associations
3. Choose a celebrity which possesses strong attachments with
the consumers.
4. Choose a celebrity that is relevant to the product.
5. The campaign should be carefully designed to use the
celebrity to enhance the brand equity of the brand by
transferring relevant associations from the celebrity to the
brand.

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Event Marketing & Sponsorships

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 Sponsorship & Event Marketing

• Sponsorship marketing means that a company pays money to sponsor

someone, some group, or something that is part of an activity to enhance
the company’s image.
• Event Marketing is a subset of Sponsorship and is the public sponsorship
of events related to sports, art, entertainment or social causes.
• Why marketers sponsor utilize sponsorships:
1. By identifying and connecting with a particular target market or lifestyle.
Example: Magic sponsoring “3 Chakar Taroka”. In other words, marketers link
their brand to an event popular to the brand’s target consumers. Hence, positive
feelings are leveraged.
2.To increase awareness of the brand E.g. Robi sponsoring the Bangladesh Cricket
Team ensures exposure of the brand. Hence brand awareness is leveraged from
the entity onto the brand.

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3. Reinforce key brand associations. Example: Zerocal
can sponsor a “healthy lifestyle” program. Hence,
brand associations are leveraged.
4. To enhance corporate image dimensions: Chevrolet
brand image is enhanced due to its sponsorship with
United. Hence, brand image is leveraged from the
secondary entity.

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• 6. To create experiences or evoke feelings –
example of ROBI and the largest human flag ever.
• 7. To express commitment to the community or
on social issues – thus enhancing brand image.
8. To entertain key clients or reward key
employees: e.g. Meril Night - inviting the
company’s publics (distributors, retailers and
wholesalers who have contributed significantly in
the success of the company during the year).
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 Sponsorship Guidelines

1. Audience should closely match the target

market.
2. The event should create sufficient awareness
where the brand should not be in a clutter
along with other brands.
3. Possess the desired image which enhances the
sponsor’s brand/corporate image.

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Strategic Brand Management Process
• Identifying and establishing brand positioning – Check!
• Planning and implementing brand marketing programs-Check!
• Measuring and interpreting brand performance.
• Growing and sustaining brand equity.

This is how brand equity is built, measured and managed.

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