LECTURE 1 & 2 (Chapter 1):

BRANDS & BRAND MANAGEMENT

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 Product and Brand
Product:
– A product is anything we can offer to a market for
attention, acquisition, use, or consumption that
might satisfy a need or want.
– A product may be a physical good, a service, a
retail outlet, a person, an organization, a place, or
even an idea.
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.”
• These different components of a brand that
identify and differentiate it are brand elements.
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 Product vs. Brand
• A brand is more than a product, as it
can have dimensions that differentiate
it in some way from other products
designed to satisfy the same need.
• Some brands create competitive
advantages with product performance;
other brands create competitive
advantages through non-product-
related means. Page 3 of 13
 Five Levels of Meaning for a Product
• Core Benefit - service or benefit that the customer
really buying. AC - Cooling & comfort.
• The marketer must turn the core benefit into Basic
Product. Sufficient cooling capacity.
• At Expected Product level buyer normally expect a
set of attributes & conditions. Consumer Report
recommends an AC to have at least 2 cooling
speeds, adjustable louvers, removable air filter, 1
year warranty etc.
• At the 4th level, marketers prepares an augmented
product that exceeds customer’s usual expectations.
Remote control, indoor-outdoor temp display.
• At the 5th level stands the Potential product which
encompasses future offerings. Silent running,
completely balanced throughout the room & energy
efficient.
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 Importance of Brands to Consumers
• Identification of the source of the product (allows to assign
responsibility to a particular manufacturer or distributor)
• Risk reducer (because of past experience with the product
& its marketing program, consumers know which satisfy
their needs and which ones do not)
• Search cost reducer (if consumers recognize & have some
knowledge of a brand, they do not need to think much or
look around to make a product decision)
• Symbolic device (brands can serve as symbolic devices,
allowing consumers to project their self-image)
• Signal of quality (some product attributes like durability,
service quality, safety, ease of use etc cannot be assessed
by inspection & brand can signal quality for such products)
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 Reducing the Risks in Product Decisions
• Consumers may perceive many different types of
risks in buying and consuming a product:
 Functional risk - The product does not perform up
to expectations.
 Physical risk - The product poses a threat to the
physical well-being or health of the user or others.
 Financial risk - The product is not worth the price
paid.
 Social risk - The product results in embarrassment
from others.
 Time risk - The failure of the product results in an
opportunity cost of finding another satisfactory
product. Page 6 of 13
 Importance of Brands to Firms
• Brands represent enormously valuable
pieces of legal property, capable of
influencing consumer behavior, being
bought and sold, and providing the security
of sustained future revenues.
• Identification to simplify handling or tracing
• Legally protecting unique features
• Signal of quality level
• Endowing products with unique
associations
• Source of competitive advantage
• Source of financial returns
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 Can everything be branded?
• Whenever and wherever consumers are deciding
between alternatives, brands can play an
important decision-making role.
• A commodity is a product presumably so basic
that it cannot be physically differentiated in the
minds of consumers. Marketers have been able to
brand what were once commodities. Some
examples are:
– Coffee (Nestle), tea (Ispahani), flour (Fresh), salt
(ACI), bananas (Chiquita), chickens (Perdue),
pineapples (Dole), and even water (Mum)
• The key success factor was that consumers were
convinced that all the product offerings in the
category were not the same & difference existed
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 What is branded?
• Physical goods: Pen, Clothes, Calculator
• Services: Airline, hotel, consulting
• Retailers and distributors: Wal-Mart, H&M, Carrefour
• Online products and services: Amazon.com, eBay.com
• People and organizations: Beckham, Oprah, Shahrukh,
IBM, Toyota, FIFA
• Sports, arts, and entertainment: IPL, Oscar, Trade-
show, Lux-Channel-I beauty contest
• Geographic locations: Attracting tourists, new
business. Cox’s Bazar, Govt. invitation to invest in BD
• Ideas and causes: “Speed kills” - DMP, “smoking is bad
for health” Ministry of Health, “corruption is evil” - TIB
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 Importance of Brand Management
• There are many brands with amazing staying
power that have been market leaders in their
respective categories for decades. Goodyear,
Kodak, Nabisco, Wrigley’s, Coca-Cola, Ivory.
• At the same time, there are number of brands
that have lost their market leadership and in
some cases their existence. GM, Polaroid,
Digital, Tibet.
• The bottom line is that any brand - no matter
how strong at one point in time - is vulnerable,
and susceptible to poor brand management.
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 Branding Challenges and Opportunities
• Savvy customers: Consumers today are more
knowledgeable and experienced with marketing
and therefore it is more difficult to persuade them
with traditional communications
• Brand proliferation: Too much brand extensions
with a number of different products complicates
the marketing decisions
• Media fragmentation: TV ads are losing its appeal
for several reasons (remote, cost, many channels)
and marketers are spending more on non-
traditional forms of communication (interactive,
sponsorship, in-store ad, mini-billboards in transit)
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• Increased competition: Consumption
of many items flattened & sales growth
can be achieved at the expense of
other brands
• Greater accountability: Because of
stock market pressure, marketing
managers might be forced to make
decisions for short-term benefits with
long-term cost (cutting ad expense)
 The Brand Equity Concept
• Brand equity is defined in terms of the marketing
effects uniquely attributable to the brand.
– Brand equity relates to the fact that different
outcomes result in the marketing of a product
or service because of its brand name, as
compared to if the same product or service did
not have that name.
• No common viewpoint on how it should be
conceptualized and measured
• It stresses the importance of brand role in
marketing strategies.
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 Strategic Brand Management
• Involves design and implementation of marketing
programs and activities to build, measure, and
manage brand equity
• Strategic Brand Management Process has four
main steps:
1. Identifying and establishing brand positioning
and values
2. Planning and implementing brand marketing
programs
3. Measuring and interpreting brand performance
4. Growing and sustaining brand equity
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