Hospitality Management Strategies©2005 Pearson Education, Inc. By R.A. NykielUpper Saddle River, N.J. 07458 Brand Strategy and Management Chapter 6

Hospitality Management Strategies ©2005 Pearson Education, Inc.By R.A. Nykiel Upper Saddle River, N.J. 07458

Brand Strategy and Management

Chapter 6


HMS - Brand Equity

“…is the net result of all the positives and negatives linked to the brand.” name symbols loyalty awareness perceived quality associations


HMS - Brand Equity (continued)

“It just does not happen…its creation, maintenance, and protection need to be actively managed and monitored.”


Brand Equity Short term tactics produce more

earnings (price promotions). Brand building activities add equity

“value” over time (image advertising).

“The challenge is to balance these activities to provide needed business while adding “value.”


Brand “Value”

Price premium the name supports Name impact on customer

preference Replacement cost of the brand Stock price Ultimately the resale value


Value of Brand Loyalty

Reduced marketing costs Create brand awareness Generates new customers Provides “base” business


Value of Brand Awareness

Top of the mind recall People like the recognizable Repetition-reinforcement-sales Brand extensions


Value of Perceived Quality

Better prices Market share Higher ROI Point of differentiation


Value of Perceived Quality

Clues to Success: Price itself (positioning) Appearance of service personnel Public spaces Other visible impression areas


Value of Brand Association

“Anything mentally linked to the brand is a brand association.”

Affect recall Point(s) of differentiation Reasons to buy Create positive attitudes and feelings Serve as a basis for trial


Value of Brand Association

Clues to Success: Overall quality ratings Technological leadership Newness Customer benefits


Brand PositioningRules

Don’t try to be something you are not. Differentiate your brand from

competitors. Provide associations that add value

and/or provide reasons to buy.

“The marketing of your brand influences how it is perceived and thus ultimately its value.”


Brand Names, Symbols, and Slogans

“Brand names, symbols, and slogans are critical to brand equity…they are assets and indicators and central to brand recognition, positioning, and associations.”


Brand Names, Symbols, and Slogans

Clues to Success: Easy to recall name Suggest positioning Support a symbol or logo Suggest desired brand associations Be easily recognizable Create positive associations and

feelings


Brand Extensions

“…are one way to exploit brand equity and extends the name.” Need to provide point of differentiation or

advantage Should “fit” the brand Should be “linkages” “Upward” extensions enhance the perception/

positioning “Downward” extensions could harm the brand


The Brand Equity Equation

CommunicationBrand

RelationshipsBrand

SupportBrand Equity


Ten Strategic Drivers of Brand Value

Creating and nourishing relationships rather than making transactions.

Focusing on stakeholders rather than just customers or shareholders.

Maintaining strategic consistency rather than independent brand messages.

Generating purposeful interactivity rather than just a mass media monologue.


Ten Strategic Drivers of Brand Value (continued)

Marketing a corporate mission rather than just product claims.

Using zero-based planning rather than tweaking last years plan.

Using cross-functional rather than departmental planning and monitoring.

Creating core competencies rather than just communication specialization and expertise.


Ten Strategic Drivers of Brand Value (continued)

Using an integrated agency rather than a traditional pull service agency.

Building and managing databases to retain customers rather than just acquiring new customers.


Value of Loyalty

To Company/Brand Buys more per

year Less costly to sell

to Less costly to

service Willing to pay

higher prices

To Customer Reduces risk Simplifies choices Saves search

time More efficient

transactions


Value of Loyalty (continued)

To Company/Brand

Provides valuable feedback

Makes referrals Convenient test

pool

To Customer Eliminates

switching costs Minimizes cost of

educating suppliers

Recognized by company


Cross and Smith’s Five Levels of Branding

Awareness. Brand is included on the customer’s menu.

Identity. Customer proudly displays the brand.

Relationship. Customers communicate with the company between purchases.

Community. Customers talk to each other.

Advocacy. Customers recommend to each other.


Stakeholders

Investors Financial Analysts Standard and

Poors Financial Press Suppliers

Customers Employees Government

Regulators Competitors Media

“All departments and employees must keep in perspective the overall corporate stakeholders and priorities…they are interlinked.”


Stakeholders (continued)

“Because brand equity is determined by the net-sum support of all stakeholders, it is important to develop and manage relationships by treating each stakeholder group as a target market with its own objectives and message strategy.”


Four Sources of Brand Messages Planned messages (marketing) Product messages (operations) Service messages (marketing and operations) Unplanned messages (situations and events)“Consistency begins with brand positioning, which is

based on core values, selling promises, and distinctive features.”


The Integration Triangle

Say

Confirm Do

Planned Messages

Unplanned Messages

Product, Service

Messages


Message Control vs. Impact

High

Low

Relative-impact

HighAbility to control/ influence

Planned

Unplanned Product Service


External Customers

“One of the psychological barriers that presents many companies from really listening is an attitude that customers don’t have anything valid to say”…”Listening is your most valuable marketing weapon.”

All brand contact points need to be monitored and measured.


External Customers (continued)

All marketing (media) should focus on: increasing and/or creating awareness qualifying prospects generating trial motivating repeat business motivating multiple unit/ brand

purchases re-acquiring those who have defected


Menu Media and Relationships

Brand relationships

Awareness Response Dialogue

Mass media

Interactive Media

Addressable Media


Perception

Image of the brand (company/ place)

Self (customer) image when experiencing the brand


Become a Brand Equity

TEAM


Brand Identity

“Unique set of brand associations which represent what the brand stands for and implies a promise to customers…”

by generating a “value” proposition by indicating benefits by eliciting emotion


Brand Identity Perspectives and DimensionsPerspectiveBrand as a product

Brand as an organizationBrand as a person

Brand as a symbol

Dimensions scope attributes quality/ value users organizational attributes personality customer relationships visual imagery metaphors prestige


Why is it Hard to Build Brands?

1. Pressure to compete on price 2. Proliferation

of Competitors

3. Fragmenting Markets &

Media

4. Complex Brand Strategies & Relationships

8. Short-Term Pressures

7. Pressure to Invest Elsewhere

6. Bias Against Information

5. Bias Towards Changing Strategies

Building Brands


Brand Identity Traps

Brand Image Trap

External Perspective

Trap

Brand Position Trap

Product-Attribute

Fixation Trap

BRAND IDENTITY

TRAPS


Brand Position

Brand Image Brand Identity Brand Position

How the brand is now perceived

How strategists want the brand to be perceived

The part of the brand identity and value proposition to be actively communicated to a target audience


A Brand is More Than a Product

PRODUCT Scope

Attributes Quality

Uses

Organizational Associations

Brand Personality

Country of Origin

User Imagery

Self-Expressive Benefits

Symbols

Brand-Customer Relationships

Emotional Benefits

BRAND


Brand Position

Subset of Identity/ Value Proposition

•Core Identity

•Points of Leverage

•Key BenefitsBRAND

POSITION

Target Audience

•Primary

•Secondary

Actively Communicate

•Augment the Image

•Reinforce the Image

•Diffuse the Image

Create Advantage

•Points of Superiority

•Points of Parity


How Brand Identity and Position Creates Value

Provide Extension Options

Improves Brand Memorability

Guides and Enhances Brand Strategy

Provides Meaning and Focus to the

Organization

Brand Identity &

Position

The Bottom Line-provides a value proposition, credibility to other brands, and basis of relationship.


Brand RolesEndorser

Driver

Silver Bullets

Branded Benefits

•Features

•Components

•Service Programs

Strategic Brands

Sub-brand Roles

•Describe Offerings

•Structure & clarity offerings

•Augment brand identity

•Exploit market opportunities

•Support extensions

BRAND ROLES


Silver Bullets

A “branded benefit” that is employed as a vehicle for changing, supporting, or enhancing the brand image of the parent brand (company). Provide extra resource

allocations (i.e., advertising, PR, etc.)

Equity/Sales Relationship

10 9 8 7 6 5 4

40

35

30

25

20

15

10

5

0

% Using

Brand

Perceived Quality

Hospitality Management Strategies ©2005 Pearson Education, Inc.

By R.A. Nykiel Upper Saddle River, N.J. 07458


The Brand Equity Ten

Loyalty Measures1. Price premium2. Satisfaction/ loyalty

Perceived Quality/ Leadership Measures

3. Perceived quality4. Leadership/ popularity


The Brand Equity Ten (continued)

Associations/ Differentiation Measures

5. Perceived value6. Brand personality7. Organizational associations


The Brand Equity Ten (continued)

Awareness Measures8. Brand awareness

Market Behavior Measures9. Market share10.Market price and distribution

coverage


Ten Guidelines for Building Strong Brands

Brand identity Value proposition Brand position Execution (Communications

Program) Consistency over time


Ten Guidelines for Building Strong Brands (continued)

Brand system Brand leverage Tracking brand equity

(awareness, perceived quality) Brand responsibility (someone/

team in charge) Invest in brands (up & down

times)


Steps to Developing a Strong Brand Choose a brand positioning for the

product/service. Choose a specific positioning for

the product/service. Choose a value positioning for the

product/service. Develop a total value proposition

for the product/service.


Steps to Building the Brand

Choose a brand name. Develop rich associations and

promises for the brand name. Manage all customers’ brand

contacts so they meet or exceed the customers expectations associated with the brand (perception positioning).


Brand Name Desireabilities Suggests something about the

products/services benefits. Suggests something about the

products/services qualities. Easy to pronounce, recognize, and

remember. Not carry poor meanings in other

languages.


Brand Associations

Attributes Benefits Values (company) Personality Users


Brand Building Tools

“Owned” word association Slogans Colors Symbols and logos Stories and legends

Documents

Hospitality Management Strategies©2005 Pearson Education, Inc. By R.A. NykielUpper Saddle River, N.J. 07458 Brand Strategy and Management Chapter 6