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How price promotion can be applied without damaging
brand equity
Ding LingGroup 8
Outline
Introduction
- Brand equity
- Price promotion Problem Solution Implication Evaluation List of references
Introduction Brand equity
Definition
“Brand equity is a set of assets andliabilities linked to a brand'sname and symbol that adds to (orsubtracts from) the value providedby a product or service to a firm.”
Source: Aaker, 1991; Aaker, 2012
Perceived quality
Brand loyalty
Brand association
Brand awareness
Other brand’s private property
Brand equity
Introduction
Price promotion
Outline
Source:Aaker (1991)
Perceived quality
Brand association
Price promotion Brand equity
Nonmonetary promotion
Advertising campaigns
Thesis Statement
How price promotion can be applied without damaging brand equity by combining the non-monetary promotion and advertising campaigns.
Problem The negative effect of frequent price promotion to
perceived quality and brand association
Source:Buil, I., de Chernatony, L. and Mart\'\inez, E. (2013). Examining the role of advertising and sales promotions in brand equity creation.
price promotion
Non-monetary promotion
Perceived quality
Brand association
1st Solution
Non-monetary promotion
-- Definition (Yi and Yoo, 2011)
Promotional strategy
Hedonic benefits
-- Different from price promotion
2nd Solution
Advertising campaigns
--Definition (Kotler, 2012)
paid form of non-personal presentation
promotion of ideas, goods and services
--Different channels
Implication of Non-monetary promotion
Positive
--customers may receive the high-quality perception
--enhance brand equity
Negative
--enterprises could spend large budget on free gifts and free samples etc.
Implication of Advertising campaigns
positive --influence consumer behaviours in a large extent
--deepen the impression of products or services
negative --further investment
--less originality
Evaluation
the overall relationship between frequent price promotion and brand equity is negative
The most effective practice: nonmonetary promotions
The alternative possible solution: advertising
campaigns
As long as non-monetary promotion and advertising campaigns are implemented appropriately, price promotion can be applied along with the combination of two solutions without damaging brand equity
List of references
Aaker, D. (1991). Managing brand equity. 1st ed. New York: Free Press. Buil, I., de Chernatony, L. and Mart\'\inez, E. (2013). Examining the role
of advertising and sales promotions in brand equity creation. Journal of Business Research, 66(1), pp.115--122.
Keller, K. (2008). Strategic brand management: building, measuring, and managing brand equity. 3rd ed.
Kotler, P., Keller, K., Brady, M., Goodman, M. and Hansen, T. (2012). Marketing management. 2nd ed. Pearson Education.
Villarejo-Ramos, A. and S\'anchez-Franco, M. (2005). The impact of marketing communication and price promotion on brand equity. The Journal of Brand Management, 12(6), pp.431--444.
Yi, Y. and Yoo, J. (2011). The long-term effects of sales promotions on brand attitude across monetary and non-monetary promotions. Psychology \& Marketing, 28(9), pp.879--896
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