MGMT 884: Brand Management

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MGMT 884 Brand Management

• Andrew Perkins
• Professor of Management
• EMBA Mini 7

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WHO IS THIS MAN?(Dont Yell it out, raise your
hand)
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What are these brands?
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Your group is the brand management team for TW
Nike

• You get to the office in the morning, and this is
  on your desk..
• Your assignment is to meet for 20 minutes and
  list all of the issues you can think of related
  to the management of the Nike golf brand
  following this environmental shock.

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Question Of The Day

• What is a Brand?
• Stay into your group
• Discuss (5 minutes)

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What is a brand?

• It is (most) all these things and more!!

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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
• This is the small b definition

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A BRAND is..

• The mental representation in the minds of
  consumers of information linked to your firm or
  business.
• This representation is in the form of links and
  nodes that are associated in memory
• The configuration of links and nodes in memory is
  brand equity that differentiates you from your
  competitors

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A BRAND is not...

• Product attributes
• Advertising campaigns
• Direct mail
• The latest marketing strategy
• The latest marketing research
• Sponsorship of the X games

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A BRAND is a relationship with your customers

• All of the strategy, designing, communication
  efforts, executions, internal struggles, stories,
  vision for the firm, and customer experiences
  with your products and services that become
  represented in memory over time are folded into
  the BRAND
• This is the big B definition
• We are going to focus on this

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Brand Management is...

• The creation and maintenance of associations in
  the memory of your current and potential
  customers
• These associations directly impact the purchase
  decisions made by your customers
• This relationship might be called Brand Equity
• We will come back to this later

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Consumer Memory

• How are Brands represented in memory?
• How does that Brand information get into memory?
• How do customers make decisions based on brand
  information?

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Memory

• Memory critical to information processing
• Why should memory and cognition matter?
• Brand equity (formally) defined as the
  differential effect of brand knowledge on
  consumer response to the marketing of a brand.
• Informally, the unique knowledge that a
  particular customer has about your brand compared
  to your competitors
• In particular, the favorability, strength and
  uniqueness of brand associations play a crucial
  role in determining the differential response
  (Keller, 1983)
• Question if you and a competitor have two
  attribute-identical products, how does a
  potential customer choose between them?

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Perceptual Maps
Taste Test Brand Known
Unknown
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Social Knowledge Structures

• Associative network
• Objects linked according to how closely
  (strongly) they are related in memory
• Activated portion represents overall meaning of
  product for the consumer at that time.
• Whatever gets activated influences any cognitive
  or implicit processes that occur as a result of
  stimulation in the environment

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Structure of Memory An Associative Network
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Self-Schemas

• Center of a Social Knowledge Structure
• Self-Concept Knowledge about oneself
• Cluster of nodes within a network that refer to
  ones self
• Multiple potential self-concepts
• Brand information can be a component of these
  self-concepts
• Nearly all information in the SKS is linked to
  the self-concept in some way.

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Question How do these associations get formed?

• Marketing communications
• Experience with the brand
• Reference groups and culture
• Family and friends
• Online and offline research
• Personal cogitation Brands as
  self-representation
• Implicit processing of Brand information

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Implicit processing of Brand information

• I thought that subliminal advertisements dont
  work?
• Subliminal Below threshold of senses
• Implicit Above threshold, but not consciously
  processed
• Explicit Above threshold, and consciously
  processed
• The Elaboration Likelihood Model (ELM) is perfect
  for understanding the Implicit / Explicit
  distinction

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Elaboration Likelihood Model (ELM)
Attention to Source
No?
Yes
No
Motivated and able to process Ad
Attention to peripheral cues
No
Observer thinks about what the ad is saying
Tentative feelings of positive affect
Change to SKS occurs
Change to SKS occurs?
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Types of Attention

• Focal Attention
• Controlled, conscious
• Self-Referencing can be a cue to focus attention
• Information or stimuli that is self-relevant
  draws attention, and has been shown to create
  stronger, longer lasting attitudes and KSs in
  memory
• Preconscious Attention
• Automatic, unconscious
• Information can be processed, and acted upon,
  without the actor realizing the influence of that
  information

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Selective Perception

• Selective Exposure Pay attention to things
  which confirm existing beliefs
• Selective Comprehension Interpret new
  information so that it is consistent with beliefs
• Selective Retention Remember items which are
  consistent with beliefs

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Expectations
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Expectations

• PLEASE!
• Keep off the
• the grass

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Expectations

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Conclusions

• Brands are sets of associations in memory that
  are the result of all of the exposures that an
  individual has with the brand
• Brand information is both reflected in and
  interpreted within the context of the
  self-concept
• Associations are difficult to build, and even
  more difficult to break

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How can we organize our company to maximize the
creation of Brand equity?

• Integrated branding Model
• An organizational strategy used to drive company
  and product direction were all actions and
  messages are based on the value the company
  brings to its marketplace
• A paradigm for building the most important asset
  that any company has the relationship with its
  customers

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The Integrated Brand (fig. 1.1)
What Customers Value
Company Strengths
BRAND
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What are the benefits of Integrated Branding?

• Internal
• A consistent compass for everyone in the firm
• A clear strategic direction, regardless of market
  changes
• Consistent messaging
• Employee loyalty
• Greater employee initiative and freedom

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What are the benefits of Integrated Branding?

• External
• A 15-20 price premium above market
• Shorter customer repurchase cycle
• Greater customer loyalty
• Customer evangelists
• A platform for maximizing probability of new
  product success
• Higher valuation and lower volatility

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Introduction to the Integrated Branding Model
Brand Conveyers
Brand Drivers
Organization Drivers
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Organization and Brand Drivers

• Organizational Drivers
• Mission
• Values
• Story
• Brand Drivers
• Principle
• Personality
• Associations

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Integrated Branding Volvo

• Group up, make a quick list of the Organizational
  and Brand drivers for Volvo
• Ill Do Story
• All groups do Mission, Principle, Values,
  Associations, Personality
• 20-25 minutes

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What makes branding difficult?

• Savvy customers
• Complexity in brand families and portfolios
• Maturing markets
• Competition
• Decreasing brand loyalty
• Eroding traditional media effectiveness
• Decreasing marketing expenditures

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The Brand Audit What is it?

• A brand audit summarizes the state of a brand vis
  a vis the Integrated Brand Model
• Prepares a firm to assess the state of the brand
• Creates a template for action based on the
  Organizational and Brand drivers
• You will pick your own Brand today
• Some already have

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Brand Audit

• Brand Inventory
• Brand portfolio, hierarchy, positioning matrix,
  competitive position (Draft due 8/13)
• Analysis of current branding program
• Organizational Drivers (Draft due 8/27)
• Brand Drivers (Draft due 9/10)
• Prototypical Knowledge Structure for Brand
  (discussion in final draft, due 9/24)
• Analysis and Recommendations
• How is the brand doing? What might be changed?
  (9/24)

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Brand Inventory Analysis

• Identify the brands portfolio (not firm
  portfolio)
• All products and extensions under the brand
  umbrella
• Develop a matrix to check for inconsistencies
• Axis 1 All of the products marketed with Brand
  Name
• Axis 2 Positioning, product characteristics,
  advertising strategy, promotional techniques,
  pricing, etc.
• You will be comparing this information to the
  Brand and Organizational drivers that you
  create/find for your brand, looking for
  inconsistencies

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Sample Brand Portfolio (Product listing
descriptions)

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Sample Brand Portfolio (Check for Inconsistent
Positioning)

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Brand Inventory Analysis

• Identify the brands portfolio (not firm
  portfolio)
• All products and extensions under the brand
  umbrella
• Develop a matrix to check for inconsistencies
• Axis 1 All of the products marketed with Brand
  Name
• Axis 2 Positioning (desired associations),
  advertising strategy, promotional techniques,
  distributional techniques, pricing, etc.
• Establish the brand hierarchy for each product
  line
• i.e., is the product marketed under a sub-brand,
  etc.

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Sample Brand Hierarchy

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Brand Inventory Analysis

• Identify the brands portfolio (not firm
  portfolio)
• All products and extensions under the brand
  umbrella
• Develop a matrix to check for inconsistencies
• Establish the brand hierarchy for each product
  line
• i.e., is the product marketed under a sub-brand,
  etc.
• Analyze Competitive Position

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Sample Competitive Analyses

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For Next Time

• ELL ZMET Project
• Choose a brand known to everyone in the group
• Each team member needs to bring 5 current
  magazines to class with them Lots of pictures
• I will provide the rest of the materials

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What a Brand is

• A brand is simply a set of associationsThat is
  linked to a brand or company nameThat resides in
  consumers' memoryThat help them understand What
  the brand or company isWhy it is potentially
  relevant to themHow it is different or similar
  to other products made by the firmHow it is
  similar or different from competitor's products