Brand Management

Chapter 1. Brands & Brand Management

Objectives

1. Define “brand”, how it differs from a product?

2. Define brand equity
3. Identify the steps in the strategic brand management process
 The meaning of BRAND

Product

A product is anything that can be offered to a market for attention, acquisition, use of consumption; it
includes physical objects, services, personalities, place, organisations and ideas.
by Philip Kotler
Anything that can be described with a noun. Ususally tangible physical and functional goods.

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.”

by American Marketing Association

A product is something made in factory; a brand is something that is bought by the customer.

by Stephan King
A brand is a product designed to meet the same needs, with additional elements added to it to
“differentiate” a product.
Brand Elements

• Different components that identifies and differentiates a brand

• Can be based on people, places, things, and abstract images
• A combination of tangible and intangible elements
 Brands vs. Products

Product Brand
Anything available in the market for use or Has dimensions that differentiate it in some
consumption, that may satisfy a need or want. way from other products designed to satisfy
the same need.
Can be categorized into five levels namely: Can be differentiated on the basis of:
• core benefit • Packaging
• generic product • Service provided
• expected product • Customer advice
• augmented product • Financing
• potential product • Delivery arrangements
• Warehousing
• Other things valued the customers
 Brand & Confirmation bias

Confirmation bias by Daniel Kahneman

• One of the cognitive distortion tendencies that consumers commonly have
• People tend to find evidence to support their existing beliefs, and ignore evidence that goes against
them or at least find excuses to rationalize them.
• People tend to re-interpret information to fit one’s existing knowledge or stereotypes
=> create its own errors and distortion

As a brand manager,
• The interpretation of new information about the existing brand can be distorted
• Difficult to alter or eliminate once confirmation bias (towards certain brands) have been established
• Try to develop positive stereotype towards our brand
• Induce new information to be interpreted in favor of our brand
Brand Equity

financial • Brand equity is equivalent to future returns

perspective
• Focusing on financial outcomes that caused by the brand
• Create brand value based on numbers
• Can be utilized for M&A process, licensing, loans..
• Difficult to identify the source of brand equity
– not providing any implications for brand management

Customer-based • The differential effect that brand knowledge has on consumer response
perspective
to the marketing of that brand
• Positive CBBE – consumers react more favorably to a product and the
way it is marketed when the brand is identified than when it is not
• The power of a brand lies in what resides in the minds and hearts of
customers
Brand Equity
Elements of Brand Equity

Brand knowledge Brand preference Brand loyalty

: in Aaker’s model
Brand recall
Brand awareness
Brand recognition

Brand image Emotional associations

favorability
strength
uniqueness

Brand benefits Brand attributes Brand attitudes

functional Non-product related
experiential product related
symbolic
Strategic Brand Management Process
Strategic Brand Management Process

Step 1. Indentify & Establish Brand Positioning and Value

• The strategic brand management process starts with a clear understanding of what the brand is to
represent and how it should be positioned with respect to competitors.
• Brand planning
 Brand positioning model : how to guide intergreated marketing to maximize competitive advantages
 Brand resonance model : how to create intense, activity loyalty relationships with customers
 Brand value chain : a means to trace the value creation process for brands, to better understand the financial
implact of brand marketing expenditures and investments.
Strategic Brand Management Process

Step 2. Plan & Implement Brand Marketing Programs

• Building brand equity requires properly positioning the brand in the minds of customers and
achieving as much brand resonance as possible.
• This knowledge building process will depend on three factor.
 Choosing Brand Elements
 Integrating the Brand into Marketing Activities and the Supporting Marketing Program
 Leveraging Secondary Associations
Strategic Brand Management Process

Step 3. Measure & Interpret Brand Performance

• To manage brands profitably, managers must implement a brand equity measurement system
• Such a system involves three key steps

 Brand audit : a comprehensive examination of a brand to assess its health, uncover its
sources of equity, and suggest ways to improve and leverage that equity.
 Brand tracking : collect information from consumers on a routine basis over time
 Brand equity management system : a set of organizational processes designed to improve
the understanding and use of the brand equity concept within a firm
Strategic Brand Management Process

Step 4. Grow & Sustain Brand Equity

• Brand equity management activities take a broader and more diverse perspective of the
brand’s equity.

 Defining Brand Architecture

 Managing Brand Equity over Time
 Managing Brand Equity over Geographic Boundaries, Cultures, and Market