Introduction to Product Management

1. Professor Carl Mela Marketing 460 Product Management Fuqua School of Business Brand Management System On Building A Brand Managing Across Brands Introduction to Product Management

2. The Ascendance of Branding

3. Agenda • Course Overview • What is a Brand? • The Value of Brands • Creating Brand Value • Brand Management

4. Course Overview • Objective • Structure • I. Brand Management System • II. On Building A Brand • III. Managing Across Brands and Geographies • Requirements • 1 project, class participation, marketing plan, and final exam. • Website provides more detail • Honor Code

5. Approach • Highly Applied • Seven Guest Speakers • Cases • Simulation • Videos • Brief Lectures (may need to stream if we run behind) • Web site

6. Note About the Simulation • Context for marketing plan • Team based • Need groups by Thursday no exceptions! • Admin leader for PharmaSim • Pay to play – no license is like shoplifting • Interpretive Software gives one option: • No one in group plays until all sign up • I negotiated another • No play for a person if not signed up

7. Approach • Innovation means risk • Guest speakers cancel or take too long • If speakers needs time, I may stream lectures • If they cancel I may need to substitute CDROM case • Be prepared or embarrass Fuqua! • New topics take time to cover, “few answers” • Simulations can have technical bugs • If you want “standard” lecture/case format, this may not be an ideal course • Tolerance for novelty and potential “glitches”

8. Who Should Take This Course “Too much emphasis on product management.”

9. Admin Details • Group Sign-up Sheet • Speaker Lunch Sign-up Sheet • 11:45-1:00 (roughly) • CR 5 (above Keller West Team Rooms) • Pizza Lunch • Limited to 9 or 10 across 2 sections • Seating Chart

10. Structure • Part I - The Brand Management System • Class 1: Class Overview • Class overview • The nature of a brand and brand valuation • Building brands • Brand/Product Management • An application to the Pepsi syringe scare • Class 2: The Marketing Plan & PharmaSim

11. Structure • Part I – The Brand Management System • Class 3: Building New Brands • Samsung Electronics Case • Class 4: Managing Mature Brands • P&G Case • Live commentary from Theresa Silver and Bill Curtis, Brand Managers at P&G

12. Structure • Part II - Building Brands (4P’s mixed up a bit due to speaker reschedule) • Class 2 (cont.): Product (Private Label) • Fighting private label brands • Class 5: Product Value and Launch • Donna Novitsky, Partner Mohr Davidow Ventures • Bayer AG Case (how much is a brand worth, how to fend off Private Label)

13. Structure • Part II - Building Brands (Cont.) • Class 6: Promotion (Sales Promotion) • Marketing and the NHL case • Live commentary from the Hurricanes VP, Assistant GM Jason Karmanos and discussion of promotion strategy • Class 7: Promotion (Advertising) • Working with agencies • Andrew Delbridge, Executive Director, McKinney & Silver – creative brief, procurement and budgeting

14. Structure • Part II - Building Brands (Cont.) • Class 8: Promotions Information Systems • Price Promotions/New Media • JP Beauchamp Executive VP Analytic Insights, Information Resources, Inc. outlines using data sources to build brands • Todd Juenger, GM and VP TiVo on ratings service • Class 9: Product (Brand Elements), Place • Brand Elements and Place • Café de Colombia case combines issues of private label, brand valuation and distribution

15. Structure • Part III - Across Brands and Markets • Class 10: Managing Across Brands • Product extensions • The Black and Decker case and video • Class 11: Managing across Markets • Brand communities/word-of-mouth • Global branding, Mike Riegel, Director Global Marketing Group, IBM • Class 12: Wrap-up • Pharma-Sim results and insights • Course summary

16. Agenda • Course Overview • What is a Brand? • The Value of Brands • Creating Brand Value • Brand Management No, not Elton Brand!

17. Agenda • Course Overview • What is a Brand? • The Value of Brands • Creating Brand Value • Brand Management

18. What is a Brand? • Name, term, sign, symbol, or design, or a combination of them intended to identify the goods and services of one seller or groups of sellers and to differentiate them from those of competition.” - AMA

19. What is a Brand • “Something some kind of team that helps each other build.” • Nathaniel • “Something that … makes a lot of different things that are the same.” • Christen

20. Why Brand? • Identify product • Identify a culture • Reduce risk • Reduce consumer search cost • Signal quality • Legal protection • Create product associations • Differentiate product

21. A Nice Branding Resource

22. Agenda • Course Overview • What is a Brand? • The Value of Brands • Creating Brand Value • Brand Management

23. What is Brand Equity? • The marketing effects uniquely attributable to the brand - Keller

24. Brand Equity • Measurement • Market value (Interbrand) • Price and sales premium • Perceptions

25. Measuring Brand Equity: Market Cap • Interbrand Survey

26. Measuring Brand Equity: Market Cap Source: Interbrand/Business Week

27. Measuring Brand Equity: Market Cap Source: Interbrand/Business Week

28. Measuring Brand Equity: Market Cap

29. Measuring Brand Equity: Sales • Customers are more price sensitive. • 75% of CPG retailers and manufacturers rank pressure to reduce price as single largest threat in the next 3 years - IRI/EIU Survey • Sales elasticities have increased 1 point in past 25 years (Bijmolt et al. 2005)

30. Corporate Reputations Source: Wall Street Journal / Harris Poll

31. Measuring Brand Equity: Perceptions Source: Wall Street Journal / Harris Poll

32. Agenda • Course Overview • What is a Brand? • The Value of Brands • Creating Brand Value • Brand Management

33. Brand Equity • But how does one develop/lose brand equity? • The goal of this section is to learn how to manage brands (via marketing programs) in order to create brand equity - that is, create an enduring advantage for your brands.

34. Brand Equity • Sources of Brand Knowledge • Associative node model of memory • Brand awareness • Brand image • Strength of brand associations • Favorability of brand associations • Uniqueness of brand associations

35. Brand Awareness Source: Wall Street Journal / Harris Poll

36. Brand Image * * * Source: Wall Street Journal / Harris Poll

37. Brand Associations

38. Figure 1-14 Building Customer-Based Brand Equity TOOLS AND OBJECTIVES KNOWLEDGE EFFECTS BENEFITS Choosing Brand Elements (4) Possible Outcome Brand name Logo Memorability Symbol Meaningfulness Character Transferability Packaging Adaptability Slogan Protectability } Brand Awareness (2) Greater loyalty Less vulnerability to competitive marketing actions and crises Larger margins More elastic response to price increases More inelastic response to price increases Increased marketing communica- tion efficiency and effectiveness Possible licensing opportunities More favorable brand extension evaluations Depth Recall Recognition Breadth Purchase Consumption Developing Marketing Programs (5 & 6) Product Functional & symbolic benefits Price Value perceptions Distribution channels Integrate “Push” & “Pull” Communications Mix and match options Brand Associations (2&3) Strong Relevance Consistency Favorable Desirable Deliverable Unique Point of parity Point of difference Leverage of Secondary Associations (7) } Company Country of origin Channel of distribution Awareness Other brands Meaningfulness Endorsor Transferability Event

39. Building Equity/Course Framework • Determine brand knowledge structures • Breadth of awareness (brand salience) • Positioning (points of parity/difference) • Image (strong & favorable brand associations) • Develop marketing programs and brand elements • Integrate across product lines and geographies • Measure and control • Feelings/judgments/loyalty

40. Evolution of Brand Elements, GE • 1876-1960’s electronics • 1900 trademark’s logo • 1900 slogan – Better Living Electronically • 1960’s General Electric -> GE • 1970’s slogan – Progress for People • 1979 slogan – We Bring Good Things to Life

41. Evolution of Brand Elements

42. Evolution of Brand Elements, GE

43. Agenda • Course Overview • What is a Brand? • The Value of Brands • Creating Brand Value • Brand Management

44. Brand Management • Brand management is the act of designing and implementing marketing programs to build and maintain brand equity. • Product • Price • Distribution • Communications

45. The Role of a Brand or Product Manager • Prepare Marketing Plan • Develop Copy, Programs, and Campaigns • Stimulate Sales and Distribution • Market Intelligence • Product Improvements

46. The Role of a Product or Brand Manager

47. The Role of a Product or Brand Manager • Productivity • Receive average of 50 emails/day • Spend 2 days/week in meetings • 50% attend > 15 meetings/week • 88% Technical, 21% Female • 38% report to Director, 35% to VP, 8% CEO • pragmaticmarketing.com

48. Typical Allocation of Time

49. Pros Quick market reaction Attention for small brands Good training for executives Cons Responsibility with no authority Administrative work with executive expectations Learn products not functions Short horizon The Role of a Brand or Product Manager

50. Brand Management Issues Media Purchasing Packaging Promotion Services Salesforce Distribution R&D Fiscal Manufacturing Legal Publicity leapfrog-strategies.com Market Research Advertising Agency