Brand Management Dr Nathalia Tjandra

1. Brand Management Dr Nathalia Tjandra

2. Welcome Module leader: Dr Nathalia Tjandra n.tjandra@napier.ac.uk Tutor: Mr Jason Ho jasonhokj@gmail.com

3. On completing of the module students should be able to: 1. Critically review strategic brand management theory. 2. Examine different foundations that are used to value brands. 3. Formulate, evaluate and justify brand development decisions. 4. Evaluate the role of the marketing mix in supporting successful brands Learning outcomes

4. Assessment 1 (50%)Deadline: Wednesday, 14th August 2017 before 17:00 GMT.Please submit your assessment to Turnitin (NO HARD COPY IS REQUIRED). • Individual report (max. 2,000 words) • For an EXISTING company and/or brand of your choice, critically review and evaluate the brand development strategy. You should attempt to explain the justification for brand development decisions that have been made and evaluate the brand marketing mix. Your approach will tend to be reflective/historic as you seek to evaluate the strategy used for the brand.

5. Assessment 1 (50%) • Marks are allocated on the following basis: • Company background 10% • Justification of brand development decisions 30% • Evaluation of the role of the marketing mix 20% • Coherence of argument 20% • Use of supporting evidence 10% • Presentation and reference list 10%

6. Assessment 2 (50%) • Group report (4 students, max. 3000 words). • Create and develop a brand management strategy for an IMAGINARY brand including the development of brand name and logo. The report should reflect how the brand will be developed, sustained and taken to an overseas market. • To assess individual contribution and participation, you will be asked to fill in an online peer assessment form in Moodle. • Failing to participate in the peer assessment will result in 20% group mark reduction. To ensure each member receives a fair group report mark, you must mark each team member according to their contribution. When all team members contribute equally to the group report (i.e. each member receives 5 marks in every element of the peer assessment), the group report mark will remain the same for every team member.

7. Assessment 2 (50%) • Marks allocated on the following basis: • Justification of the new brand and brand development decisions 20% • Integration/Application of brand management theory 30% • Rationale/Justification of international brand strategy 15% • Peer assessment* 20% • Quality and relevance of references/supporting evidence 10% • Structure and presentation 5%

8. *Peer assessment

9. Recommended texts • Keller, K. L. (2013). Strategic brand management: Building, measuring and managing brand equity (4th ed). England: Pearson. (Core text book) • Johansson, J. K., & Carlson, K. A. (2015). Contemporary brand management. Thousand Oaks, CA: SAGE. • Kapferer, J.-N. (2013). The new strategic brand management: Advanced insights and strategic thinking (5th ed.). London: Kogan Page. • Rosenbaum-Elliott, R., Percy, L., & Pervan, S. (2015). Strategic brand management (3rd ed.). Oxford: Oxford University Press.

10. Branding • A brand is “combination of a name, term, symbol or design intended to identify and differentiate goods and services from those of a competitor” (AMA, 2015) “a cluster of functional and emotional values that enables organizations to make a promise about a unique and welcomed experience” (de Chernatony et al., 2011, p.31) • A brand is MORE THAN a term, sign, symbol, design or combination of them that differentiated products from a competitor.

11. Brand versus products Keller et al., 2013

12. Physical goods Services Retailers and Distributors Online products and services People and Organisations Sports, Arts, and Entertainment Geographic locations Ideas and Causes What Can Be Branded? (Keller et al., 2012)

13. Why brand matters? (Keller et al., 2012)

14. Almost everything can be branded • Branding has become so pervasive, and consequently everything offered in the market place will become branded (Schmitt, 1999). • “In the 1970s, people were exposed to approximately 500 commercial messages per day. With today’s technology, the estimates have jumped to as high as 30,000 messages per day” (Malone, 2011).

15. The best global brands 2015 Interbrand, 2016

16. Characteristics shared by the worlds strongest brands Keller et al., 2012

17. The benefits of a strong brand • Improved perceptions of product performance • Greater loyalty • Less vulnerability to competitive marketing • Less vulnerability to crises • Larger margins • More inelastic consumer response to price increases • More elastic consumer response to price decreases • Greater trade co-operation and support • Increased marketing communication effectiveness • Possible licensing opportunities • Additional brand extension possibilities Keller et al., 2012

18. 6 powerful ways to differentiate your brand • Van Auken, 2014

19. Summary • Definition of a brand • Product vs. brand • Almost everything can be branded. • Characteristics of a strong brand. • Differentiation and positioning are the key to a successful brand.

20. Food for thought “It's not enough for people to just know your brand. You want people to be actively thinking about your brand, and, crucially, talking about it. Really famous brands, like Apple or Nike, become part of the cultural lexicon, the web of symbols that we use to define ourselves and our world” – Les Binet, European director of DDB Matrix

21. References • Achenbaum, A. A. (1993). The mismanagement of brand equity. Harvard Business Review, 83-91. Digi-Capital. (2013). Global games investment review 2013. Retrieved 20 February 2014, from http://www.digi-capital.com/news/2013/07/digi-capital-global-games-investment-review-2013-q2-update/ • Hobbs, T. (2015). British consumers would not care if 94% of brands disappeared’. Retrieved September 7, 2015, from http://www.marketingweek.com/2015/07/22/british-consumers-would-not-care-if-94-of-brands-disappeared/?nocache=true&adfesuccess=1 • Keller, K. L., Apéria, T., & Georgson, M. (2012). Strategic brand management: A European perspective (2nd ed.). Essex, UK: Pearson Education Limited. • Malone, C. (2011). Can you hear me now? Web-enabled brand experiences that cut through the clutter. Retrieved 24 April 2014, from http://www.forbes.com/sites/onmarketing/2011/11/03/can-you-hear-me-now-web-enabled-brand-experiences-that-cut-through-the-clutter/ • Mitchell, V.-W., Walsh, G., & Yamin, M. (2005). Towards a Conceptual Model of Consumer Confusion. Advances in Consumer Research, 32, 143-150. • Schmitt, B. H. (1999). Experiential marketing: how to get customers to sense, feel, think, act, and relate to your company and brands. New York: The Free Press. • VanAuken, B. (2014). 6 Powerful ways to differentiate your brand Retrieved 20 February 2014, from http://playbook.amanet.org/6-powerful-ways-to-differentiate-your-brand/

22. Beyond the functionalism of a brand Dr Nathalia Tjandra

23. What a brand is… How brands work? What a brand does for… • Identity • Name • Logo • Colors • Products • Services • Image • Positive associations • Negative associations • Promises • Personality • Traits the brand elicits • Gestalt of these traits • Consumers • Reduces psychological risk • Reduces functional risk • Supports self-expression • Simplifies decision making Brand • Firms • Provides strategic protection • Supports pricing power • Gives leverage in the channel • Reduces entry barriers • Supports product line extension • Buffers stock price Johansson & Carlson (2015, p.4)

24. Evolution of a strong brand A strong brand has a sure identity, a positive image and a unique personality Time Johansson & Carlson (2015, p.4)

25. Brand Identity – Who are you? • To be successful, a brand should have a clear identity. • Based on facts and can be controlled by managers. • Strong brand identity means customers know what the brand promises and what the company behind it stands for. • A brand’s identity can be found in: • Brand name, slogan and logo • History/age • Country where it comes from • Product and service category • Target market Johansson & Carlson (2015)

26. Who am I? I am a German-made driving vehicle with superior engineering and outstanding handling characteristics for customers that demand highest performance. I am the ultimate driving machine.

27. Brand image – What comes to mind when I think about you? • Perceptions about a brand as reflected by the brand associations held in consumer memory. • Associations come in all form and may reflect characteristics of the product or aspects independent of the products itself. • Marketers will attempt to mold the brand’s image by influencing perceptions of the brand and by formulating a value proposition that emphasise brand’s strength. Johansson & Carlson (2015)

28. How Apple is associated in consumers’ mind?

29. Aaker’s (1991) brand associations typology • Product attributes • Intangibles • Customer benefits • Price • Use/ application • User • Celebrity • Life style • Product class • Competitors • Country of origin

30. Brand personality – What kind of personality are you? • “The set of human characteristics associated with a brand”(Aaker, 1997, p. 47) . • The subset of image associations that are personality traits or characteristics (i.e. the personification elements of the image). • It is strongly influenced by the personality traits of the “typical” user personality. • Also known as the “brand style”, the way “brand, talks and dresses”. • Some brands do not want to create narrow personalities that appeal only to distinct users. Johansson & Carlson (2015)

31. Down-to-earth Honesty Wholesome Cheerful Daring Spirited Imaginative Up-to-date Reliable Intelligent Successful Upper class Charming Outdoorsy Tough Aaker (1997, p. 352)

32. Functional and emotional values • “A brand is a cluster of functional and emotional valuesthat enables organisations to make a promise about a unique and welcome experience.” (p.31) • Brands succeed because customers perceive them as having value over and above that of the “equivalent” commodity. • Value is “in the eyes of the beholder” judged by the customers “relative to competing brand”. de Chernatony et al. (2013)

33. Functional values of a brand • Customers’ perceptions about whether brands can satisfy their utilitarian needs. • Can be assessed by customers’ experience of trying different brands, examining functionalityand considering the price of the brands. • Best value, quality, taste and design. • Consumers reduce search costs in terms of having to evaluate all aspects of a products and looking for alternatives. de Chernatony et al. (2013) Johansson & Carlson (2015)

34. Emotional values of a brand(psychological and social) • Customers’ perceptions of whether brands can satisfy their psychological and social needs. • Can be assessed by customers recalling promotions, considering the context the brands are used, or their prior experiences of the brands. • Prestige, distinctiveness, style, or social assurance. • To avoid customers’ risk of making the “wrong” choiceand social disapproval. de Chernatony et al. (2013) Johansson & Carlson (2015)

35. Added value beyond functionalism • More than just utilitarian benefits. • Physical constituents augmented to satisfy social and psychological needs. • Personality surrounding the product creates consumer confidence. • Images help to form a mental vision • of what the brand stands for. • of the needs, values and lifestyles consumers associate with. • However, in commodity-like markets (e.g. industrial products, bank services) functional values dominate social-psychological values.

36. Added value beyond functionalism E.g. Guinness • At physical level • Rich, creamy, dark, bitter drink. • Surrounding personality • Symbolic of nourishing value, myths of power and energy. • Aids subconscious assessment • of appropriateness of brand personality in a particular situation. • and ultimately consumer choice. http://www.youtube.com/watch?v=rx0MRawkrj4 http://www.youtube.com/watch?v=XpaOjMXyJGk

37. Self-expressive benefit • A brand is a tool for self-realisation, a symbol of aspiration, a sense of achievement. • Self-expression is not simply an issue for buyers of hedonic products (i.e.luxury watches, sport cars and designer clothes) but also affects more utilitarian choices. • Using a certain brand can foster peer group acceptance and express person’s identity. • The brand helps express a certain personality, and the brand’s characteristic becomes linked to the user. Johansson and Carlson (2015)

38. Summary • A strong brand has a sure identity, a positive image and a unique personality. • A strong brand serves to reduce functional and psychological-social risks. • A strong brand supports self-expressive benefits.

39. References • Aaker, D. A. (1991). Managing brand equity: Capitalizing on the value of a brand name. New York: Free Press. • Aaker, J. L. (1997). Dimensions of brand personality. Journal of Marketing Research, 34(3), 347–356. • de Chernatony, L., McDonald, M., & Wallace, E. (2013). Creating powerful brands (4thed). London: Taylor & Francis Routledge. • Johansson, J. K., & Carlson, K. A. (2015). Contemporary brand management. Thousand Oaks, CA: SAGE. • Keller, K. L., Apéria, T., & Georgson, M. (2012). Strategic brand management: A European perspective (2nd ed.). Essex, UK: Pearson Education Limited.

40. Brand positioning Dr Nathalia Tjandra

41. Learning outcomes • Define and discuss the concept of segmentation, target marketing and positioning. • Comprehend the concept of positioning a brand as a “value added”. • Distinguish the concepts of points of parity and points of difference. • Evaluate brand repositioning strategies.

42. Brand positioning “The act of designing the company’s offering and image to occupy a distinctive place in the minds of the target market” (Kotler & Keller, 2012, p. 276) • “A distinctive place in mind” does not simply mean that consumers remember the brand. • Consumers should also have favourable beliefs and emotions about the brand. • Preferably these beliefs and emotions should also be more positive than their feelings about competitor brands. • Positioning activities do not always succeed at creatng the intended brand position. What determines the position is ultimately how consumers perceive the brand • Positioning is part of the S -T- P process: Segmentation – Targeting – Positioning

43. Segmentation The identification of individuals or organisations with similar characteristics that have significant implications for the determination of marketing strategy. The advantages of market segmentation: Differentiation. Target market selection. Tailored marketing mix. Opportunities and threats. Characteristics for successful segmentation Measurable, accessible, substantial, differentiable and Actionable 43

44. The process of market segmentation and target marketing c1 c3 c2 c1 c3 c1 c3 c4 c5 c2 c4 c5 c2 c4 c6 c5 c7 c6 c8 c7 c6 c8 c7 c8 The disaggregated market The segmented market The target market 1 2 3 1 2 3 Marketing mix targeted at segment 3 Segment 3 is judged to be most attractive and a marketing mix strategy is designed for that target market Customers are grouped into segments on the basis of having similar characteristics The characteristics of individual customers are understood 44

45. Segmenting consumer markets Consumer segmentation Behavioural Psychographic Profile Benefits sought Demographic Lifestyle Purchase occasion Socio-economic Personality Purchasebehaviour Geographic Usage Perceptions and beliefs 45

46. Generational segmentation Williams & Page, 2011; Grail Research 2011

47. Target marketing strategies The choice of which market segment(s) to serve with a tailored marketing mix. • Undifferentiated marketing occurs where a company does not segment but applies a single marketing mix to the whole market. • Differentiated marketing occurs where a company segments the market and applies separate marketing mixes to appeal to all or some of the segments (target markets). • Focused marketing occurs where a company segments the market and develops one specific marketing mix to one segment (target market). • Customized marketing occurs where a company designs a separate marketing mix for each customer. 47

48. Undifferentiated strategy example ORGANISATION MARKETING MIX TARGET MARKET • Product • Price • Promotion • Distribution Post Office Everybody 48

49. Example of differentiated strategy Utilitarian Customer Marketing Mix 1 Trendy- Casual Marketing Mix 2 Marketing Mix 3 Price shopper LEVI’s Marketing Mix 4 Mainstream Marketing Mix 5 Traditionalist 49

50. Example of focused strategy Independent DIY Shops Unserved MARKETING MIX ORGANISATION Product Price Promotion Distribution • Product • Price • Promotion • Distribution Builders Merchants Cement Manufacturer Unserved National DIY Chains 50