Brand Management Facilitation

8/2/2019 Brand Management Facilitation

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Brand Management Facilitation


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Todays Presentation

Definition

Key terms in brand management

The brand management model Sector overview

Behavior of the model

The dissertation model Q&A


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A Brand Marks what People Think and

Feel

It is a rational and emotional formula based

on the sum of trust, relevance, and

significance that relates people to a firm, a

product, or a service throughout their life.


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Market Dynamics

Businesses and markets in which brands play

an important role are both highly complex:

They are tightly coupled: there are lots of

complex interactions, interventions based on asingle action are unlikely to prove successfulin the long term

They behave counter-intuitivelythey canbehave in the opposite manner to which oneintends


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Market Dynamics cont.

They exhibit trade-offs

They are policy resistantattempting to

influence the system in one direction will

often cause some reaction which minimizes

the impact of the original action

And they are dynamicchanges occur on

many different timescales


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Brand ManagementSome Key Terms

Brand AwarenessBrand Loyalty

Motivation

Desire to Buy Brand

Perceived Quality

SatisfactionNegative Product Image

Positive Product Quality

Brand Equity


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The Dimensions in Brand Building

Brand identity

Brand awareness

Familiarity and knowledge of the brand Consideration to evaluate the brand

Purchase

Brand loyalty (or brand equity)


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A Managers Goal must be to Build

Brand Equity

A brand can only be strong if it has a strong

supply of loyal customers

Brand equity therefore can be defined as a

measure of strength of consumers attachment

to a brand.


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Brand Equity

Source: Interbrand 1999, The World Biggest Brands

Brand Name Industry Brand Value

($US m)

Brand Value as

a % of Market

Capitalisation

Coca-Cola Beverages 83,845 59%

Microsoft Software 56,654 21%IBM Computers 43,781 28%

General Electric Diversified 33,502 10%

Ford Autos 33,197 58%

Disney Entertainment 32,275 61%

Intel Chips 30,021 21%

McDonald's Fast Food 26,231 64%AT&T Telecom 24,181 24%Marlboro Tobacco 21,048 19%


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Purpose and Goal of the Model

Brand equity is a complex system and

difficult to manage and understand.

A simulation model will be used, to identify

key leverage points to understand the

behavior of the system, thus reduce

uncertainty in decision making.


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The

Brand ManagementModel


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Brand

loyalty

Perceived quality

Satisfaction

Negative productimage

++

R

-

+/-

Quality is

Job One

Product

attractiveness

+

ranManagementA Conceptualized

Sector Overview

The BrandAwareness/Effectiveness

Sector

The BrandAwareness/Loyalty

Sector

The BrandLoyalty/Quality

Sector

Brand

Awareness

Motivation

Desire t o

choose brand

Brand

loyalty

+

+

+

+

R

It's What theCustomer Wants

RSnowball

Attractiveness of

other brands

-

-

Brand

Awareness

Competitivepressure

Effectiveness

Investment

-

+

+

B

BCompetition

Influences

Investment

Influences

+-

Knowledge+

+Knowlegeis good

R


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The Brand Awareness/Effectiveness

Sector

Brand

Awareness

Competitive

pressure

Effectiveness

Investment

-

+

+

B

BCompetition

Influences

Investment

Influences

+

-

Knowledge+

+Knowlegeis good

R


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Vensim Brand

Awareness/Effectiveness Sector

Brand

Awareness

Competitive

pressure

Decrease in

awarenessIncrease in brand

awareness

Fraction of pot ential

BA reached

Net effect of BALoyalty factor

Initial

Investment

Above-the-line

investment

Price promotion

investment

Below-the-line

investment

Public relations

investment

Wei ght onabove-the-line

investment

Weight on price

promotion investment

Weight onbelow-the-line

investment

Weight on public

relations investment

Effect from investment

in Price Promotion

Consumer

knowledge

about brandKnowledge gain

Effect on gaining

knowledge

Forgett ing rate

Forget impact

on awareness

Awareness

investment

Awareness

multiplier


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The Brand Awareness/Loyalty

Sector

Brand

Awareness

Motivation

Desire to

choose brand

Brand

loyalty

+

+

+

+

R

It's What the

Cus tomer W ants

RSnowball

Attractiveness of

oth er brands

-

-


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Vensim Brand Awareness/Loyalty

Sector

Motivation

Attrac tiveness to

choose other brands

Brand

Loyalty

Increase in brand

loyalty

Pressure on

loyalty

Effect on brand

choice

Investment effects onbrand loyalty

Desire to buy

brand

Increase in desire

Factors to

increase desire

Loosing interest


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Vensim Brand Loyalty/Quality

Sector

Perceived

Product

QualityPressure on

PQ

PQ net

increase

Negative product

image

Satisfaction

PQ multipliers

Relative delivery

delay

Product

Attractiveness

Effect of price on

attractiveness

Effect of quality on

attractiveness

Effect of delivery delay

on attractiveness

Actual product

quality

Relative

Price

Price

Acceptable price

Delivery delay

Acceptable

delivery delay


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The Brand

Loyalty/Quality Sector

Brand

loyalty

Perceived quality

Satisfaction

Negat ive product

image

++

R

-

+/-

Quality is

Job One

Product

attractiveness

+


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The Bottom Line: Brand Equity

Brand Equi ty


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Model Behavior

Base Run100 Awareness

100 Loy alty

100 desire

1 Quality

0 Awareness

0 Loy alty

0 desire

0.4 Quality

0 6 12 18 24 30 36 42 48

Time (M onth)

Brand Awareness : base Awareness

Brand Loyalty : base Loyalty

Desire to buy brand : base desire

Perceived Product Quality : base Quality

Investment: 70ATL: 0.7BTL: 0.1PP: 0.1PR: 0.1


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100 Awareness

100 Loy alty

100 desire

0.8 Quality

0 Awareness

0 Loy alty

0 desire

0.4 Quality

0 6 12 18 24 30 36 42 48

Time (Month)

Brand Awareness : base2 Awareness

Brand Loyalty : base2 Loyalty

Desire to buy brand : base2 desire

Perceived Product Quality : base2 Quality

Model Behavior

Investment: 35ATL: 0.7BTL: 0.15PP: 0.05

PR: 0.1


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Weakness of the Model

Does not consider people in the system

Missing link to capture growth and decline of

market share

Key leverage point: investment rather than

consumers


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The new Approach: Brand Equity

as Resource System

Loyal Customers 0 3 6 9 12

Inflow

Outflow


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Objectives

To gain insides in how to control a desired

level of loyal customers, thus support resource

allocation decisions of a firm

To test and compare alternative strategies to

improve the management of brand equity


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What is the contribution to the body of

knowledge?

Theory:

By creating a generic model to investigate the

effect of resource allocation which influences

the brand equity of a firm

Praxis:

Providing recommendations for improvingbrand strategies


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Causal Loop Diagram

Competitive

pressure Brand awareness

Familiarity &

knowledge of thebrand

Consideration to

evaluate brand

Desire to buy

brand

Purchase

Brand loyals

Investment

+

Evaluat ion of

alternatives

+

+

+

+

-

+

+

+

+

Word of mouth

+

+

+

Att ractiveness of

products

Perceived quality

of brand

+

+

+

-

Quality Price

R2

R1

R5

B1

R3-

R4

Effect from invstment

Competitor

determins choice

Awareness from

Investment

Word of mouth effect

Effect from price

value relation

Investment contro l


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Stock and Flow Structure

Unaware Aware Familiarity &

Knowledge

ConsiderationDesire to buyLoyalty

Potentials Becoming aware Gaining knowledge

Attractiveness

Purchase Evaluation

Potential

customers

Population

Investment

Word of mouth

Relevance (advantage

over competitor)

Evaluation of

alternatives

Attractiveness of

other brands

Price sensitivity

Satisfaction rate in

categoryAttr activeness of

product

Preceived quality

Ownership

experience

Loosing awareness

Loosing interest


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R

Documents

Brand Management Facilitation