The Company as a Brand

1. The Company as a Brand Corporate Reputation and CompetitivenessLecture 4

2. Lecture Objectives • To explore what in ‘branding can be applied to the management of corporate reputation

3. 20% 10% 20% 10% 20% 20%

4. What is a brand? • A company with a price advantage can be undercut. A company with a performance advantage can be outflanked. But a company with an emotional difference can potentially demand a premium forever. David Ogilvy • The most important aspects of a brand are the associations we make with the brand name, particularly the more affective (emotional) ones.

5. THE MARKETING MIX People Sales Place Product Customer Offer Price Service Promotion

6. Advertising Sales Ratio

7. Brands and Advertising

8. Today’s Brands are Corporate Brands • Multiple stakeholders: customers, employees, shareholders, the media, suppliers. • Multiple channels: Direct, Intermediaries, the Internet. • Multiple product types: Products and Services, Umbrella brands and extensions. • The Service Economy

9. People Sales Place Product Customer Offer Price Service Promotion

10. Electrical Retailers Fashion Retailers Customer Numbers Advertising Spend Advertising Spend Source: Davies (1991)

11. The Different Roles of Advertising • Advertising can create a brand image for a physical product • The customer recreates the imagery in use • Advertising can communicate a brand for a service or corporate brand • Advertising an image for a service which is not matched by the experience is a mistake

12. How Reputation is Created From Bernstein (1984)

13. The COO Effect • "Before 1918 nobody knew where a product came from. In that year Germany lost the First World War. To punish German industry and to warn the European consumer of that time, German manufacturers were obliged to put on each product they exported 'Made in Germany' labels (in English). Very soon it became a sign of quality", (Morello, 1984: p.5).

14. The COO Effect • “Generalized images created by variables such as representative products, economic and political maturity, historical events and relationships, traditions, industrialization and the degree of technological virtuosity which will have effects upon consumer attitudes additional to those emanating from the significant elements of the products.” Bannister and Saunders (1978)

15. The Industry Effect God made the wicked grocer for a mystery and sign, That men might shun the awful shops and go to inns to dine, GK Chesterton

16. Corporate v Product Branding • The case of own brands competing with national brands • Own brands have many cost advantages • They often lack cache, but not always! • They have an image for poor quality…but • Other corporate brands are seen as quality signs

17. Supply Chain Cost Structure: Margarine

18. The Theft of Image

19. Positioning Positioning is the place the product occupies in consumers’ minds relative to competing products. Positioning is the way the product is defined by consumers on important attributes.

20. Positioning (Ries and Trout) • Positioning is what is distinctive about you, what sets you apart from the rest • Positioning is not what you do to the product or service. Positioning is what you do to the mind of the prospect. You position yourself in the mind of the prospect. • Positioning requires a frame of reference, usually the competition.

21. Competitive Strategy (Porter) • Strategy is concerned with identifying how you intend to meet your corporate objectives • Competitive Strategy involves positioning a business to maximise the value of the capabilities that distinguish it from its competitors.

22. Speciality Wholemeal Wheatmeal Health White, sliced High fat breads Price

23. Fraser Principles Next M&S Debenhams Dorothy BHS Perkins River Littlewoods Etam Island New Look Top Shop C&A Evans Miss Mail order Selfridge

24. Understanding Brands: The Use of Metaphor • Metaphor is (literally) false (Roger is a lion) but our view of the target (Roger) is transformed and illuminated by the lion metaphor • Metaphor helps us to understand the complex through the medium of something more familiar

25. 3 Main Root Metaphors Brand as differentiating mark Brand as Person Brand as Asset Brands can be valued Brands can and should be protected Brands can be invested in Brands can be bought and rented Brands can be used for different businesses Brands are sources of economic power A Brand has a Personality We can have a relationship with a Brand We are loyal to Brands Brands have reputations Brands have Values A Brand is a Name A Brand is a Symbol Metaphors and Sub Metaphors for a Brand

26. Potential New Root Metaphor Brand as Role Brand as Pilot Brand as Partner Brand as Family Brand as Seducer Virgin v Nivea Brand extensions as brother etc Co-branding IBM Intel Ford Firestone Cigarette brands Cosmetics Cars Virgin Retailer as agent

27. Seeing Brands as People • Qualitative research: ‘What newspaper would the brand read? Where would it go on holiday? What car would it drive?’ • Quantitative research: On a scale from 1 to 5 with 1 meaning strongly disagree and 5 meaning strongly agree, if MBS came to life as a person how well would ‘friendly’ describe its personality?

28. Summary • Many Branding ideas can be applied to managing corporate reputation • One exception is the value of advertising