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8/9/2019 Chap02=Marcom & Brand Equity
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MARCOM CHALLENGES:MARCOM CHALLENGES:Enhancing Brand Equity,Enhancing Brand Equity,
Influencing Behaviour and BeingInfluencing Behaviour and Being
AccountableAccountable
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1. Explain the concept of brand equity from both the
companys and the customers perspectives.
2. Describe the positive outcomes that result from
enhancing brand equity.
3. Appreciate a model of brand equity from the
customers perspective.
4. Understand how marcom efforts must influencebehavior and achieve financial accountability..
Chapter Objectives
After reading this chapter you should be able to:
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Introduction:Introduction:
Framework for Marcom ProcessFramework for Marcom Process
Fundamental
Decisions
Desired
OutcomesImplementation
Decisions
Evaluation and
Corrective Action
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Basic IMC IssuesBasic IMC Issues
How to enhance
brand equity
How to affect
customer
behavior
How to justify
marcom
investments
How to
demonstrate
financial
accountability
Marketing
Communicators
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BrandBrand
BrandBrand IIs a name, term, sign, symbol, or design.s a name, term, sign, symbol, or design.
Identifies and differentiates goods and services of oneIdentifies and differentiates goods and services of one
seller or group of sellers from those of theseller or group of sellers from those of the
competition.competition.Communicates a particular set of values.
Brand EquityCan be considered either from the perspective of the
organization that owns it or from the vantage point oft or from the vantage point of
the customer.the customer.
Is valuable when consumers believe the brand canIs valuable when consumers believe the brand can
deliver on its promises.deliver on its promises.
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A FirmA Firm--Based Perspective on Brand EquityBased Perspective on Brand Equity
Higher
market share
Increased
brand loyalty
Premium
pricing
Revenue
premiums
Effects of Brand
Equity Increases
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Brand Equity IncreasesBrand Equity Increases
Revenue Premium The revenue differential between a branded item and
a corresponding private labeled item.
Revenue premium for a branded item (b) compared toa private label (pl) =
(volumeb)(priceb) (volumepl)(pricepl)
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Source:Adapted from Kevin Lane Keller, Conceptualizing, Measuring, and Managing
Customer-Based Brand Equity, Journal of Marketing57 (January 1993), 7.
A Customer-Based Brand Equity
Framework
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The Brand Awareness Pyramid
Source: David A. Aaker, Managing Brand Equity(New York: Free Press, 1991), 62.
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Forms ofBrand KnowledgeForms ofBrand Knowledge
Brand AwarenessWhether a brand name comes to mind when
consumers think about a particular product category
The ease with which the name is evoked
Brand Image The types of associations that come to the
consumers mind when contemplating a particular
brand
Top-of-Mind Awareness (TOMA)Occurs when a brand is the first brand that
consumers recall when thinking about brands in a
particular product category.
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Brand AssociationsBrand Associations
Positive
Attributes
Perceived
Benefits
Favorable
Attitude
Brand image
associations that
build brand equity
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Dimensions ofBrand PersonalitiesDimensions ofBrand Personalities
Excitement
Sincerity
RuggednessSophistication
Competence
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Ways of Enhancing Brand EquityWays of Enhancing Brand Equity
Speak-for-Itself Message-Driven Leveraging
Enhancing Brand
Equity
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Leveraging Brand Meaning from Various Sources
Source: Kevin Lane Keller, Brand Synthesis: The Multidimensionality ofBrand Knowledge,
Journal of Consumer Research 29 (March 2003), 598. By permission of the University of Chicago Press.
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Types ofBranding for LeveragingTypes ofBranding for Leveraging
CoCo--BrandingBranding
A partnership between two brandsA partnership between two brands
Ingredient BrandingIngredient Branding
Inclusion of one brand within the otherInclusion of one brand within the other
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What Benefits Result from EnhancingWhat Benefits Result from Enhancing
Brand Equity?Brand Equity?
Increased consumer loyaltyIncreased consumer loyalty
LongLong--term growth and profitability for theterm growth and profitability for the
brandbrand
Maintain brand differentiation fromMaintain brand differentiation from
competitive offeringscompetitive offerings
Insulate brand from price competitionInsulate brand from price competition
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Measuring WorldMeasuring World--Class BrandsClass Brands
Quality Salience Equity
Evaluating
World-Class Brands
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Characteristics of a WorldCharacteristics of a World--Class BrandClass Brand
Delivers benefitsconsumers want
Stays relevant
Price equals value
Good positioning
Consistency
Fits into brand portfolio
Brand helps build brandequity
Brands managers
understand what the
brand means toconsumers
Support over long run
Monitoring of the sources
of brand equity
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Interbrands Top 20 Global Brands, 2007
Source: Interbrand Report, Best Global Brands 2007, http://www.interbrand.com/best_brands_2007.asp.
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Affecting Behavior and AchievingAffecting Behavior and Achieving
Marcom AccountabilityMarcom Accountability
The Importance ofBrand Awareness
Creating brand awareness and boosting brand image
serve little positive effect unless individuals make
purchases or engage in desired behaviors
Marcoms objective is ultimately to affect sales
volume and revenue
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Measuring Marketing InvestmentMeasuring Marketing Investment
PerformancePerformance
Return on Marketing Investment (ROMI)
Measures the effect of marcom, or of its specific
elements such as advertising, in terms of whether it
generates a reasonable revenue return on themarcom investment
Why Measure Marcom Effectiveness?
Demands for greater accountability on the marketing
function To become better at marcom activities
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Measuring Marketing InvestmentMeasuring Marketing Investment
PerformancePerformance
Difficulties in Measuring MarcomDifficulties in Measuring Marcom
EffectivenessEffectiveness
Choosing an appropriate metricChoosing an appropriate metric
Gaining agreement on measuresGaining agreement on measures
Collecting accurate data for marcom assessmentCollecting accurate data for marcom assessment
Determining effects of specific marcom elementsDetermining effects of specific marcom elements
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Difficulties in Measuring MarcomDifficulties in Measuring Marcom
Effectiveness: Choosing a MetricEffectiveness: Choosing a Metric
Change in
brandawareness
Improvement
in attitudestoward
the brand
Increased
purchaseintentions
Larger salesvolume
What to Measure?
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Difficulties in Measuring MarcomDifficulties in Measuring Marcom
Effectiveness: Gaining AgreementEffectiveness: Gaining Agreement
Finance Departments
Measures of Success:
Discounted cashflows
Net present values of
investment decisions
Marketing
Departments
Measures of Success:
Measures of brand
awareness, image,
and equity
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Difficulties in Measuring MarcomDifficulties in Measuring Marcom
Effectiveness: Collecting Accurate DataEffectiveness: Collecting Accurate Data
and Calibrating Special Effectsand Calibrating Special Effects
What exact sales figures should be used to
calculate sales?
How much relative effect does each program
element have on sales volume compared to
the effect of other elements?
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Measuring Marcom EffectivenessMeasuring Marcom Effectiveness
MarketingMarketing--Mix ModelingMix ModelingEmploying econometric statistical techniques toEmploying econometric statistical techniques to
estimate the effects that elements of the marcom mixestimate the effects that elements of the marcom mix
have in driving sales volume.have in driving sales volume.
Example:Example: