What is a brand (AMA)?
A brand is a name, term, sign, symbol, or design which is intended to identify the goods or services of one seller or group of sellers and to differentiate
them from those of competitors. - American Marketing Association.
What is a brand for consumers?
A brand is a set of mental associations held by the consumer, which add to the
perceived value of a product or service” (Keller, 1998)
How many types of brands are there?
3
What are the different types of brands?
- Attribute brand: Which conveys confidence in the product’s functional attributes [VOLVO]
- Aspirational brand: Which conveys image about type of people who buy the brand. Consumers seek status, recognition & esteem. Luxury markets. [ROLEX}
- Experience brand: Conveys an image of shared associations, emotions & personal values. Not based on a product or ‘look’. In B2C markets. [NIKE]
How are brands built?
- Built around a functional product. However, this is insufficient to earn economic profit
Give a Distinctive Identity.
- A distinctive identity creates customer recognition, but alone is insufficient to create preference
Adding Value.
- Gives consumer confidence that product has quality
- Helps to create customer preference
- This is based on customer perception
What are the benefits of brands?
Heightened brand awareness, image improvement, attachments, can be profitable
Through what means do brands create a preference with customers?
Brands have to differentiate and add value in the eyes of the consumer.
What is the Customer-Based Brand Equity Model?
Keller (1993).
Explain how a strong brand can have an impact of the level of cashflow.
Strong brands can enjoy a higher level of cash flow due to:
• Charger higher prices
• Higher volume growth [more purchases]
• Lower costs [economies of scale]
Explain how a strong brand can have an impact on the timing of cashflow.
Strong brands can enjoy a better timing of cash flow due to:
• Earlier payback for new products
• Faster customer response to marketing campaigns
• Better access to distribution channels [get product out quicker]
Explain how a strong brand can have an impact on the duration of cashflow.
Strong brands can enjoy a better/more steady duration of cashflow due to:
• Major role of brands is to extend returns into the future
• Longevity of many of the world’s top brands
Explain how a strong brand can have an impact on the future risk of cashflow.
- Strong, durable brands support more stable cash flows
- Reduces vulnerability to competitive attack
- Loyal customer base reduces need for high-risk investments in winning new customers
What is brand architecture?
• Product brand.
The ability to put different products in different market segments individually through unique name & positioning (e.g. Nestle, Purina)
• Line brand
New products added easily. Complementary products easily added (e.g. Coca-Cola; diet, zero)
• Range brand
Broader array of products within same area of competence (e.g. Weight Watchers: food/drinks/scales/books)
• Source brand
Product name plus corporate or range name (e.g. Kellogg’s Cornflakes)
• Endorsing brand
Weaker association of product & corporate brand name (e.g. Nestle KitKat)
• Umbrella brand
Brand supports several products in different markets (e.g. Phillips)
What is a brand/line extension?
Using the same brand name to cover:
• New lines in the current product category = Line Extension
• New products in different categories = Brand Extension
What are the downsides to brands?
- Vital to SHV
- Require careful investment & management
- Require continual investment & management
What do brands need to be in order to create a competitive advantage?
- Unique (Distinctive/distinguishable)
- Strong (consumers need to consider it as relevant to them)
- Positive
Give an example of an Attribute brand.
Volvo
Give an example of an Aspirational brand.
Rolex | Aston Martin
Give an example of an Experience brand.
Muscle Food | My Protein | Nike
