Brand – Provide Value to Consumer & The Company

Value to the consumer Value to thecompany

Relationship

And

Emotional

Link

Brand

Asset

Through

Brand

Equity

Easier identification

Guide Purchase Decision

Reduced Perceived Risk

Quality Consistency Guarantee

Self- Expression AndSocial Identity

Trust & Assurance

Satisfaction AndConsumption Pleasure

Repeat Business

Aid New Product Introductions

Competitive Entry Barrier

Maintain DifferentiationAgainst Competition

Better Managed Channel PartnersPartners

Command Price Premium

Investor / Shareholder Confidence

Committed & Focused Staff

PurposePurposeOfOfTheThe

BrandBrand

VALUE CREATION

IMMORTAL BRAND

BRAND

LABEL

PRODUCT

SELF EXPRESSIVE BENEFITS

FUNCTIONAL ANDEMOTIONAL BENEFITS

FUNCTIONAL /EMOTIONAL BENEFITS

PRODUCT FEATURESPrice Differentiation Factor

EXPERIENTIAL APPROACH TO BRANDING

Physical Consumption

Application- Based Consumption

Non – Reality Consumption

Conspicuous Consumption

Risk- Free Consumption

Physiological Experience

Application Experience

Fantasy Experience

Social Experience

Well- Being Experience

BRANDING CHALLENGES

• Informed and Savvy Customers (Trust mark & Emotionalconnect)

• Brand Proliferation

• Media Fragmentation

• Sophisticated and Increased Competition.

• Decreasing Brand Loyalty.

• Growth of Private Labels.

• Increasing Trade Power

• Focus on Promotions.

• Stress on Advertising Expenditure.

• Short- Term Performance Orientation.

VIRGIN - BRAND IDENTITY

Brand Essence - Non- Conformist/ Unconventional

• Core Identity - Consistent best- of-category quality delivered with humor and flair

• Innovation - First with truly innovative, value - added features and services

• Fun & Entertainment - A fun and entertaining company

• Value for money - Value in all offerings, not just the high price option.

Extended Identity• Underdog - Innovative & creative offers to counter established firms.

• Personality - Flaunts rules, Humorous, Outrageous, Competent, Stylish.

• Symbol - CEO led perceived lifestyle approach, Virgin Script Logo.

Value Proposition• Functional Benefits - Quality Value Offering with extras delivered with style.

• Emotional Benefits- - Fun & good Times association, Attitude to serve the best.

• Self- Expressive Benefits - Be Outrageous against the norms.

• Relationship - Customers as fun companions.

Identity Vs Tagline

• Represents the identity

• Communicate & energizeinternal staff.

• Timeless/ Long timeproposition

• Relevant across markets &products.

• IBM - Magic you can trust

• Dominos- Guaranteed Delivery

• Nike - Excelling

• Represents the brand position

• Communicates with external world.

• May change / reposition.

• Confined approach.

• IBM - Solutions for a small planet

• Dominos- Hungry Kya

• Nike - Just do it

BRAND SUCCESS TRAITS Excel at Delivering benefits customers truly desire

Stay Relevant

Pricing Strategy - Customers’ perception of value.

Proper Positioning.

Brand Consistency.

Brand Portfolio and Hierarchy to be sensible.

Build Brand equity on well coordinated marketing activities.

Brand Managers awareness of what the brand means to customers.

Provide proper and sustained brand support in the long run.

Company to monitor the source of brand equity

PERCEIVED RISK

Brands reduce the Risks in Product Decisions

Functional Risk

Physical Risk

Financial Risk

Social Risk

Psychological Risk

Time Risk

CUSTOMER BASED BRAND EQUITY PYRAMID

Resonance

Judgment Feelings

Performance Imagery

Salience

Relationships(What about you & me?)

Response(What about you?)

Meaning(What are you/)

Identity(Who are you/)

BRAND SCORECARDBRAND SCORECARDYour Brand Which Means Instance

Delivers BenefitsCustomers Desire

Customer engagement Starbucks

Stays Relevant Elements of the Brand Gillette

Price based onconsumer’sperception ofbrand’s value

Product nature i.e. PremiumVs Household Staple

P&G

ProperlyPositioned

Conveys similarity with &Differences againstcompeting brands

Visa

Consistent Consistent MarketingCommunications over time

Nike

BRAND SCORECARDBRAND SCORECARDYour Brand Which Means Instance

Sensible fit inthe Brand Portfolio

Brands- Logical working Gap, Banana Republic, OldNavy.

IntegratedMarketing

Solidified Brand Identity Coke

ManagersunderstandMeanings

consumer’s differentperceptions.

Gillette

Receivesupport

Consistent investment inbrand awareness.

Samsung & LG

constantlyMonitored

brand equity managementsystem.

Disney

MEASURING BRANDSMEASURING BRANDS

THREE PATHS

Customer –BasedBrand Metrics

IncrementalBrand Sales

BrandedBusiness Value

AttitudinalData

Hierarchy ofEffects

TrackingStudies

Market PlacePerformance Data

Marketing MixModeling - ROI

PredictiveModeling - ROCI

BrandValuation

Discounted CashFlows

BrandScorecards

BRAND AWARENESSBRAND AWARENESS

Brand Recognition(At Point of Purchase)

Brand Recognition(At Point of Purchase)

Brand Recall(prior to Purchase)

Brand Recall(prior to Purchase)

PlusBrand Attitude

PlusBrand Attitude

Motivation TypeMotivation TypeInformational(Negative Motivation)

Transformational(Positive Motivation)

Typical Product Categories( Brands may Differ)

• Aspirin• Light Beer• Detergent• Routine Industrial Products

Typical Product Categories(Brands may Differ)

• Microwave Oven• Insurance• Home Renovations• Mew Industrial Products

Typical Product Categories( Brands may Differ)

• Candy/ Chocolates• Regular Beer• Fiction Novels

Typical Product Categories(Brand may Differ)

• Vacations• Fashion Clothing• Cars• Corporate Image

• Brand Loyal• Routinized Favorablebrand switchers

• New Category Users• Experimental or Routinized other brand switchers• Other Brand Loyals

LOWInvolvement(TrialExperienceSufficient)

HIGHInvolvement(Search &Convictionrequired prior

to purchase

DecisionType

DecisionType

BRAND VALUE CHAINBRAND VALUE CHAIN

VALUE

STAGES

- Product - Awareness - Price Premiums - Stock Price

- Communication - Association - Price Elasticities - P/E Ratio

- Trade - Attitudes - Market Share - Market Cap.

- Employee - Attachment - Expansion Success

- Other - Activity - Cost Structure

- Profitability

MULTIPLIER

- Clarity - Competitive Reactions - Market Dynamics

- Relevance - Channel Support - Growth Potential

- Distinctiveness - Customer Size & Profile - Risk Profile

- Consistency - Brand Contribution

MARKETINGPROGRAM

INVESTMENT

CUSTOMERMINDSET

MARKETPERFORMANCE

SHAREHOLDERVALUE

PROGRAMQUALITY

MARKETPLACECONDITIONS

INVESTORSENTIMENT

LEVILEVI’’SS –– BRAND ATTRIBUTE & BENEFIT ASSOCIATIONBRAND ATTRIBUTE & BENEFIT ASSOCIATION

AttributesAttributes

User ImageryUser Imagery Usage ImageryUsage Imagery

ProductProduct –– RelatedRelated BrandBrand

AttributesAttributes PersonalityPersonality

Functional BenefitsFunctional Benefits Symbolic BenefitsSymbolic Benefits

Experiential BeExperiential Benefitsnefits

Western, American, Blue Collar,Hard Working, Traditional,Strong, Rugged & Masculine

Appropriate for OutdoorWork & Casual SocialSituations.

Blue Denim, Shrink-to-fitcotton fabric, Button Fly, Twohorse patch & Red pocket tag.

Honest, contemporary,Classic, Approachable,Independent & Universal.

High- Quality, Long Lasting& Durable.

Self- Confident & Self-Assurance Feeling

Comfortable fit andRelaxed Wear

LEVILEVI’’SS501501

Benefits

BRAND HIERARCHYBRAND HIERARCHY

Nothing Else Beats It

Does it Offer Me

Something Better Than Others

Can It Deliver

Does it Offer Me Something

Do I Know About It

Measures Consumer Attitudes, Beliefs & Opinion.

Defines the Five Levels of Brand Relationship

BONDING

ADVANTAGE

PERFORMANCE

RELEVANCE

PRESENCE

PRODUCTPRODUCT -- THREE LEVELSTHREE LEVELS

Augmented Product

CoreProduct

Actual Product

Installation

Delivery

and

Credit

After-

Sales

Service

Warranty

Packaging

Quality Design

Brand

Name

Product

FeaturesCORE BENEFIT

OR

SERVICE

EXPERIENCE ECONOMYEXPERIENCE ECONOMY

Charge for the Stuff - Commodity Business.

Charge for Tangible Things – Good Business.

Charge for Activities you Perform – Service Business.

Charge for time spent by consumers with you- Experience Business.

THE IDEA IS NOT TO ‘SELL SOMETHING’, BUT TODEMONSTRATE HOW A BRAND CAN ‘ENRICH ACUSTOMER’S LIFE’.

VALUE PROPOSITIONVALUE PROPOSITION

Short

Specific ( relate to customer)

Customer’s Language

By the seat of the pants ( Use experience, Instinct orguesswork to be avoided).

VALUE PROPOSITION SHOULD :

Solve Consumer Problem.

Deliver Benefits.

Improve their situation / Impact them

Enrich lives.

VALUE PROPOSITIONVALUE PROPOSITION –– A PROMISEA PROMISE

•• PROMISEPROMISE –

– An anticipation of VALUE

– Set of Promises to target, differentiated against Competing simi lar offersbacked up by reason to believe.

•• BENEFITSBENEFITS

– Functional, Economic, Emotional.

•• DIFFERENTIATED VS ALTERNATIVE OPTIONSDIFFERENTIATED VS ALTERNATIVE OPTIONS

– Customer buys competing offer.

– Status Quo that customer does not buy at all/ defers.

– Competing with yourself ( advanced/ new version sale)

•• PROMISE EVIDENCEPROMISE EVIDENCE

– Physical

– Testimonial

– Third Party Endorsement.

PRODUCT CLASSIFICATION BASISPRODUCT CLASSIFICATION BASIS

The Nature of Consumer Buying Behavior

Consumer Goods – Frequently purchased without much deliberations, Wideavailability.

Shopping Goods – More Planned and compared.

Specialty Goods – Select Outlets, Inelastic demand with little or no comparison.

Involvement Level in Purchase Process

Low Involvement – Little deliberations, low risk perception.

High Involvement – Invest time & effort , high risk perception

Type of Benefit

Functional/ Utilitarian Benefit – Logical, Rational advantage.

Emotional Benefit – Ego Expressive need.

o Brands in same category may position product at opposite side of spectrum.

o Different customers may place same product in different classes.

PRODUCT POLICY DECISIONSPRODUCT POLICY DECISIONS

Product Attributes or Features ?

Preferred Trade-off between Product Development Costs Vs ConsumerValue delivered ?

Post successful product launch, managing ‘me- too’ products ?

Structure of its New Product Development pipeline ?

Preferred Product Mix composition ?

Product line/ Brand Extension types?

Avoid Brand Dilution ?

Product offering prune ?

Product line trade down thru cheaper version offer of current product ?

PRODUCT DECISIONSPRODUCT DECISIONS

• Product Attributes : Define prod. Benefits e.g. Quality,Features & Design.

Watches, Cars, Electronic Eqpt - Performance quality.

Test equipment, Life Saving eqpt. - Conformance quality i.e. defect free.

Cell phones, cars, computers - Features to add value & relevance.

Cars, Watches,Audio & video eqpt. - Design (Gillette, Braun)to be competitive.

• Branding : Important part of the product that adds value.

Brand sponsor options while the product is launched.

Co-branding, Line Extension & Brand Extension, Multi brands & New Brands.

• Packaging : Primary & Secondary container to protect & market the product as well.

Tetra Pack with UHT technology for juices are consistent with adverts, pricing &distribution.

• Labeling : From Simple tags to complex graphics

Identifies maker, place, date of mfr. & expiry,contents, usage methods & safety.

States unit pricing, open dating( shelf life), & nutritional labeling.

• Product Support Services : Part of the complete offer to augment the product.

Computers, Cars, Electronic Equipment need service to support the sale.

PRODUCT POLICY DECISIONSPRODUCT POLICY DECISIONS

Recognize core customer need intended to satisfy.

Whether product ideally suited to satisfy the need.

Does it need redesigning.

Create sustained competitive advantage thru augmentation.

Monitor customer satisfaction experience.

POSITIONINGPOSITIONINGPOSITIONING

MARKET

SEGMENTATION

MARKET

TARGETING

MARKET

POSITIONING

IDENTIFY SEGMENTATION BASIS

EVOLVE SEGMENT PROFILES

EVALUATE SEGMENT ATTRACTIVENESS

SELECT ONE OR MORE SEGMENTS TO ENTER

POSITIONING TO EACH TARGET SEGMENT

MARKET MIX FOR EACH TARGET SEGMENT

POSITIONING STRATEGIES• :POSITIONING BY ATTRIBUTE :

POSITIONING BY PRICE /QUALITY:

POSITIONING BASED ON USE OR APPLICATION

POSITIONING BY PRODUCT USER :

POSITIONING BY PRODUCT CLASS:

POSITIONING AGAINST COMPETITOR :

POSITIONING PREMIUM PRODUCTS• PRODUCT FEATURES

• PERFORMANCE QUALITY

• PRODUCT EXCLUSIVITY & STYLE

• PRODUCT DESIG

• SERVICE QUALITY

• PEOPLE QUALITY

• PACKAGING QUALITY

• IMAGE QUALITY

PRODUCT FAILURES

• INCORRECT POSITIONING :

• IMPROPER PRICING :

• PRODUCT DESIGN FAILURE

• UNDERESTIMATING COMPETITION

• OVERESTIMATING MARKET SIZE

• LACK OF GENUINE SUPERIORITY

• LACK OF DISTRIBUTION SUPPORT

NEW PRODUCT DEVELOPMENT DECISION PROCESSNEW PRODUCT DEVELOPMENT DECISION PROCESS

Idea

Generation

Is it worth

Considering

Idea

Screening

Idea compatibility

with objectives,

strategies &

Resources

Concept Dev.

& Testing

Good concept

that consumers

may try

Marketing

Strategy Dev.

Cost- effective

& affordable

marketing strategy

Business

Analysis

Products meets

the profit goal?

Product

Dev.

A technically

& commercially

Viable product

Market

Testing

Have product

Sales met

Expectations?

Commercialization

Are product sales

Meeting expectations

Send back

to product

Dev.

Modify product or

Mktg. program

NoNo Yes

Yes

CATEGORIES OF NEW PRODUCTS

New to the world products

New product lines

Additions to existing product lines

Improvements & revisions of existing products

Repositioning

Cost reductions

INNOVATION ADOPTION CHARACTERISTICS

Relative Advantage

o Superiority over existing products.

o Greater the degree, quicker the adoption.

Compatibility

o Congruence with lifestyle & Values of potential users.

Complexity

o Degree user friendliness.

o More the complexity, longer the adoption process.

Divisibility

o Trial ability on small quantity/ limited basis.

o More the options, better & earlier the adoption.

Communicability

o Benefits are observably or describable to others.

o Interest & curiosity for potential users.

MARKET TESTING

New product introduced into authentic setting.

Consumer & Dealer reaction to handling, usage & repurchase.

Valuable info on dealers, potential buyers, marketing programs &markets.

High Investment – High Risk Products with failure risk

Test Influenced by Investment cost & risk, Time pressure & researchcost.

Product creating new categories/ with novel features need test.

Modified products ( imitative) may avoid.

High value cosmetics avoid test market- Demonstrators at dept. stores.

TEST MARKETING – BUSINESS GOODS

• Expensive / New Technology Products– Alpha Testing ( Inside Org.) & Beta Testing ( Consumers)

– Beta Testing• Small numbers of test customers invited.

• Observe test consumers usage pattern.• Exposes unforeseen issues on safety/ servicing etc.• Observe customer value addition for pricing clues.• Ask for purchase intention.

• Seek test reactions, if any.

• New Industrial Products– Introduce at Trade Shows

• Buyer interests recorded.• Reaction to features and terms.• Purchase intentions & order placements.

– Distributor & Dealer Showrooms• Place adjacent to own products/ competitor products.• Valuable preference & pricing info in selling atmosphere.

• Ability to handle orders placed.• All customers not representational target market.

Value Innovating:Four Basic Questions

What factors should be reduced well below the industry standard?

What factors should be raised well beyond the industry standard?

What factors should beeliminated that the industry

has taken for granted?

What factors should becreated that the

industry has never offered?

ValueInnovation

Raise

Eliminate Create

Reduce

MARKET ENTRY TIMINGMarket entry on commercialization with three options :

First Entryo Enjoys ‘first mover’ advantage.

o Leadership position, firm up distributors & customers.

o A non- debugged product can backfire.

Parallel Entryo Coincide with competitor entry.

o Better interest & enthusiasm in the market.

Late Entryo Delay launch till competitor entry.

o Lesser education effort.

o Faults rectified.

o Ascertain true market size.

Criteria to choose rollout markets Market Potential.

Local reputation of the co.

Cost of filling pipeline.

Cost of communication media.

Competitive penetration

Influence of this area on other areas.

VALUE CREATION & DELIVERY

Customer

Segmentation

Market Selection

/ Focus

Value

Positioning

Product

Development

Service

DevelopmentPricing

Sourcing

Making

Distributing

Servicing

Sales ForceSales

PromotionAdvertising

Choose The ValueChoose The Value

Provide The ValueProvide The Value

Communicate The ValueCommunicate The Value

Strategic Marketing

Tactical Marketing

BREAKTHROUGH VS INCREMENTALBREAKTHROUGH VS INCREMENTAL

Breakthrough Incremental

- Now-to-the-world Performance Features - Improvement in existing product

- Huge advance in performance - Derivative of existing product platform

- Dramatic cost reduction - Exploits existing forms of technology

- High Risk - Lower Risk

- Expensive - Less Expensive

- Targeted to New or Existing Markets - Targeted to existing or Adjacent Markets

Marketer’s Key Responsibilities

- Envision the Market - Listen to the Existing Market

- Create Demand - Accommodate Current Demand

- Educate the Market

PRODUCT DEVELOPMENT FUNNELPRODUCT DEVELOPMENT FUNNEL

CustomerNeeds

ConceptGeneration Product Prototyping Pilot Manufacturingand Design and Testing Production Ramp Up andSelection Release

TechnologicalPossibilities

CREATING PROJECT PLANSCREATING PROJECT PLANS

PROCESS CHANGES

PRODUCT CHANGES New Core Process Next Gen Upgrade Tuning/ Incremental

New Core Product BREAKTHROUGH

Next Gen Product

PLATFORM

Addition toProduct Family

Add – ons and DERIVATIVESEnhancements

STAGESTAGE –– GATE MODELGATE MODEL

Initial Second Decision on Post- Pre- Launch Post -

Screen Screen Business Development Business ImplementationCase Review Analysis Review

G1 G2 G3 G4 G5

Ideation Preliminary Detailed Development Testing & FullInvestigation Investigation Validation Production

(Build Business Market LaunchCase)

Idea S1 S2 S3 S4 S5 PIR

PRODUCT CONCEPT GENERATION Translating Customer Needs into Product Features:

Customer vocabulary of ‘comfort’, ‘reliable’ ‘ safe’ etc.

Preliminary Specifications may be modified..

Assign metrics for ‘Q F D’ to co-relate among attributes.

What is a Concept Concept Positioning Statement to answer ‘Who’. ‘What’ and “How’.

Positioning.= Differentiation ( What +How) + Segmentation ( For Whom)

Text, Drawings & Models about the performance & Technical features.

Configuration, how will it serve customers, who they are, its meaning tocustomers.

Concept Description as – Speed, Size, Horsepower etc.

Product Integrity Extent to which the totality of the product achieves the balance ( Basic

functions, esthetics, semantics, reliability, & economy) and att racts andsatisfies customers.

Product Architecture product changes e.g. upgrade, add- ons, wear and tear, replacing.

Varieties desired

Performance Levels to be achieved

PROTYPINGPROTYPING

Types of Tests Performed on Prototypes:

– Technical Performance Evaluation ( Engineering)

– Esthetic features ( Marketing & Industrial Designers)

Overall Objectives :

Test the feasibility of a concept

Physical / Analytical modeling.

Arrangement & fitment of parts, cost factors, motor sounds, insulations.

Customer feedback assimilation

User comfort, sturdiness, packing.

Communicate an Idea ( company, suppliers, distributors etc)

Management commitment for investment.

Pilot Production and LaunchPilot Production and Launch

Pilot Production :

Test readiness to ship including assembly, test, operational procedures..

Molds, machines etc to support any anticipated need levels.

Establishment of basic processes of manufacture.

Ramp Up :

Develop capability to produce volumes e.g. first year.

Manufacturing, design, suppliers, shipping etc involved.

Launch :

Target segment, positioning, product & service combination, distributionexecuted for the right customer at the right time and right price.

MARKETERMARKETER’’S ROLES ROLE -- PRODUCT DEVPRODUCT DEV

Market Size and probability of acceptance in specific segments.

Reaching these segments – Existing Channel Capability & Cost .

Identifying specific customer requirement & How rapidly they change

Price Range acceptability to the market.

Competition profiling.

Articulation of the value proposition of the new product.

Answers entered into Business Analysis & Revenue - Cost Projections.

MATCHING DEVELOPMENT PROCESS WITH PRODUCTMATCHING DEVELOPMENT PROCESS WITH PRODUCTTYPETYPE

Crash MostProgram Challenging

High

Speed at WhichMarket Windowis Closing(Opportunity Cost)

Low 100 % Right

Low High

Degree of TechnicalInnovation Required( Development Risk)

NEW PRODUCT TYPES

MismatchMismatch

BreakthroughBreakthrough IncrementalIncremental

MismatchMismatch

Breakthrough

Incremental Breakth

rough

Incr

ementa

l

Supplier’s Perception Custom

er’sperc

eption

PRICING STRATEGY - PRODUCT MIX

1 PRODUCT LINE PRICING:

2 OPTIONAL -PRODUCT PRICING :

3 CAPTIVE -PRODUCT PRICING :

4 BYPRODUCT PRICING :

5 PRODUCT BUNDLE PRICING :

STRATEGIES TO ADJUST PRICE

1 DISCOUNT & ALLOWANCE PRICING

2 SEGMENT PRICING

3 PSYCHOLOGICAL PRICING

4 PROMOTIONAL PRICING

NEW PRODUCT PRICING

A IMITATIVE NEW PRODUCT ( Quality & Price Conscious Buyer

Category)

High PRICE Low

High

Premium Good Value

QUALITY

Over Charging Economy

Low

PRICE ALTERATIONS

1 PRICE CUTS :

2 PRICE INCREASES

3 BUYER REACTIONS

4 COMPETITOR REACTION

5. REACTION TO COMPETITOR PRICE CHANGES

PRICE CHANGE METHODS

To reduce customer sensitivity to price:

• OFFER QUALITY PERCEPTION

• OFFER LINE EXTENSIONS

• UNBUNDLING

• OPPORTUNITY PRICING

• REPOSITIONING

• DISCOUNT REDUCTIONS

VALUE - PRICING THERMOMETER

Optimal Pricing Perceived Value at Upper end.

Influenced by TEV by mktg. mix & substitute products.

COGS at Lower end.

Objective Value

Marketing Efforts

Perceived Value

Substitute Consumer’s Incentive to BuyPricing =( Perceived Value- Price)

Product Price

Firm’s Incentive to Sell=( Price – COGS)

Cost of Goods Sold

Rupee 0

PORTER’S GENERIC STRATEGIES

Competitive Advantage - Are Products differentiated in any way or merely costbasis

Competitive Scope – Does the co. target a wide / narrow market

CO

MP

ET

ITIV

ES

CO

PE

Na

rro

wB

roa

dCOMPETITIVE ADVANTAGE

Low Cost Higher Cost

Overall Cost

LeadershipDifferentiation

Cost

Focus

Differentiation

Focus

Competitive Advantage – (Cost or Differentiation Advantage )

BOWMAN’S CLOCK

• Option one - low price/low added value

– likely to be segment specific

• Option two - low price

– risk of price war and low margins / need to be a 'cost leader '.

• Option three - Hybrid

– low cost base and reinvestment in low price and differentiation

• Option four – Differentiation

– (a) without a price premium• perceived added value by user, yielding market share benefits

– (b) with a price premium• perceived added value sufficient to bear price premium

• Option five - focused differentiation

– perceived added value to a 'particular segment' warranting a pre mium price

• Option six - increased price/standard

– higher margins if competitors do not value follow/risk of losing market share.

• Option seven - increased price/low values

– only feasible in a monopoly situation

• Option eight - low value/standard price

– loss of market share

PRICE POLICY - INFLATION

Systematic Discounting

Promote Multi Unit Buying

Improve Efficiency

Pass on Costs when justified

Detest Trimming Marketing Spends

CONSUMER REACTIONS- INFALTION

Down Trade : Shift to regular petrol.

Bulk Buy: Stock up select product at current prices.

Watch Fine Print : Detailed check for quantity/ weight.

Package size alterations.

More Demanding : Negotiate hard deals .

Substitution: Trading in petrol vehicle for a diesel.

LEGAL / ETHICAL ISSUES

Differential Pricing: Better only when value added. Not seeking advantage by unfair means.

High pricing of life saving drugs.

Pricing to Undermine Competition :

Predatory Pricing :

Price Fixing:

Price Maintenance:

Pricing Principles be subjected to ethical review and an informedlegal review within company prior to implementation.

MEASURING BRAND PERSONALITYMEASURING BRAND PERSONALITYMEASURING BRAND PERSONALITY

oo COMPETENCECOMPETENCEo Reliable : Hardworking, Secure, Efficient, Trustworthy,

Careful.

o Intelligent : Technical, Corporate, Serious.

o Successful : Leader, Confident, Influential.

oo SOPHISTICATIONSOPHISTICATIONo Upper Class : Glamorous, Good- Looking, Pretentious,

Sophisticated.

o Charming: Feminine, Smooth, Sexy, Gentle.

oo RUGGEDNESSRUGGEDNESSo Outdoorsy : Masculine, Western, Active, Athletic.

o Tough : Rugged, Strong, No-Nonsense.

MEASURING BRAND PERSONALITYMEASURING BRAND PERSONALITYMEASURING BRAND PERSONALITY

oo SINCERITYSINCERITY

o Down –to-Earth : Family Oriented, Small Town,Conventional, Blue Collar.

o Honest : sincere, Real, Ethical, Thoughtful, Caring.

o Wholesome : Original, Genuine, Ageless, Classic, Old-Fashioned.

o Cheerful : Sentimental, Friendly, Warm, Happy.

oo EXCITEMENTEXCITEMENT

o Daring : Trendy, Exciting, Off- Beat, Flashy, Provocative.

o Spirited : Cool, Young, Lively, Outgoing, Adventurous.

o Imaginative : Unique, Humorous, Surprising, Artistic, Fun,

o Up-To-Date : Independent, Contemporary, Innovative,Aggresive.

DIMENSIONS – BRAND IDENTITYDIMENSIONSDIMENSIONS –– BRAND IDENTITYBRAND IDENTITY

BRAND ASA PRODUCT

BRAND ASAN ORGANIZATION

BRAND ASA SYMBOL

BRAND ASA PERSON

- Product Scope- Product attributes- Quality/ Value- Uses- Users- Country of Origin

- OrganizationalAttributes.Innovation,.Trustworthy.Genuine customer

concern- Local Vs Global

-Visual Imageryand Metaphors

-Brand Heritage

- Personality

- BrandRelationships

BRAND IDENTITY

APPROACHESAPPROACHES -- DEVELOP BRAND PERSONALITYDEVELOP BRAND PERSONALITY

◊◊ SELFSELF-- EXPRESSIONEXPRESSION

◊◊ RELATIONSHIPRELATIONSHIP

◊◊ FUNCTIONAL BENEFITFUNCTIONAL BENEFIT

BRAND IDENTITY PRISMBRAND IDENTITY PRISM –– SIX FACESSIX FACES

∆ PHYSIQUE - The Basis of the brand.

( Philips is Technology & Reliability , ICICI is Trust)

∆ PERSONALITY – What happens when brand becomes a person.

( Macho Marlboro, Strong Ambuja)

∆ CULTURE - Organizational Symbols, Country of Origin & Values

( Balsara & Dabur for Traditional Remedies, Germany forPrecision Engineering, Japan for Consumer electronics)

∆ RELATIONSHIP – Handshake between brand & consumer.

( Colgate – Dependability, Saffola – Safety)

∆ REFLECTION – Consumer perception of what the brand stands for.

( Coke reflects youthful values for both young & old)

∆ SELF- IMAGE - What the consumer thinks of himself.

( Benz owner – Elite with the best car, Tractor EmulsionPaint - Upper Class Look )

BRAND POSITIONING - CHECKLISTBRAND POSITIONINGBRAND POSITIONING -- CHECKLISTCHECKLIST

• Relevant?

• Believable?

• Ahead of trend?

• Defensible?

• Deliverable?

BRAND ARCHITECTURE

BrandArchitecture

Brand Portfolio• All Brands• All Sub-brands

Product – MarketContext Roles

• Endorser/ Sub- brands• Benefit Brands• Co – Brands• Driver Roles

Portfolio Roles• Strategic Brands• Linchpin Brands• Silver Bullets• Cash Cow Brands

Brand PortfolioStructure

• Brand Groupings• Brand Hierarchy Trees• Brand Range

Portfolio Graphics• Logo• Visual Presentation

Powerful Optimal Allocation of Synergy in creating Visibility, Clarity of Leveraged Platforms forBrands Brand Building Resources Association & Efficiency Offerings Brand Assets future growth options

BRAND VALUE PYRAMID

Most Meaningfuland most difficultto imitate.Hardest todeliver

Easiest to deliver,but least meaningfuland most easilyimitated

The Emotional,Spiritual& CulturalValues beingAddressed

The Functional orEmotional Benefitsprovided tocustomers

Features orProcesses thatmust bedemonstrated tocustomers.

BELIEFSAND

VALUES

BENEFITS

FEATURES AND ATTRIBUTES

PRINCIPLES TO DEVELOP BRAND PROMISEPRINCIPLES TO DEVELOP BRAND PROMISE

• Understand the Promise from the customerperspective

• Translation of Promises into Standards

• Fulfill good promises or risk brand damage

• Mend bad promises instantly

LEVERAGING THE BRANDLEVERAGING THE BRAND

LEVERAGINGLEVERAGING

THE BRANDTHE BRAND

Line Brand Vertical Stretch Co- brandingExtensions Extensions of the brand Marketing venture

In the existing In a different In the existing with another brand

product class product class product class

Create a Stretching Stretching

Range brand Up Down

BRAND HIERARCHYBRAND HIERARCHY –– COLGATE ORAL CARE PRODUCTSCOLGATE ORAL CARE PRODUCTS

COLGATECOLGATECOLGATE

COLGATETOOTHPASTE

COLGATETOOTHBRUSH

COLGATEDENTAL FLOSS

PLUS

COLGATEMOUTHWASH

COLGATEFLUORIDETABLETS

COLORCHANGE

YOUTHCLASSICPRECISION

DIAMONDHEAD

‘THE WILDONES’

BRAND EXTENSION - ADVANTAGESBRAND EXTENSION - ADVANTAGES

• Brand image improvement.

• Reduces customer risk perception

• Increases probability of gaining distribution and trial.

• Increases efficiency of promotional expenditure.

• Reduces introduction costs.

• Reduces developmental cost of new brand.

• Packaging and labeling efficiencies.

• Consumer variety options.

CUSTOMER EVALUATION OF EXTENSIONSCUSTOMER EVALUATION OF EXTENSIONSCUSTOMER EVALUATION OF EXTENSIONS

• Parent brand awareness & positive associationin memory.

• Positive associations evoked thru theextensions

• Negative associations not transferred

• Negative associations not created by theextension

LINE EXTENSIONLINE EXTENSION

◊ EXPANDS USER BASE :

◊ PROVIDES VARIETY :

◊ ENERGIZES A BRAND :

◊ INHIBIT COMPETITION :

◊ MANAGE TRUE INNOVATION :

LINE EXTENSIONSLINE EXTENSIONSLINE EXTENSIONS• Customer Segmentation

• Consumer Desires

• Pricing Breadth

• Excess Capacity

• Short – Term gains

• Competitive Intensity

• Trade Pressure

LINE EXTENSIONS - ISSUESLINE EXTENSIONSLINE EXTENSIONS -- ISSUESISSUES

• Weakens Line Strength

• Weaken Brand Loyalty

• Stagnant Category Demand

• Trade Relations Weaken

• Increased Costs

EXTENSION EVALUATION BASISEXTENSION EVALUATION BASISBrand

Concept Resources

Fit

EXTENSIONEXTENSION

Relevance Sustainable

Advantage

Customer Competition

Needs

CO - BRANDINGCO - BRANDING

•• Usage extensionUsage extension

•• Ingredient CoIngredient Co-- BrandingBranding

•• Image ReinforcementImage Reinforcement

•• Composite Brands or Bundling of BrandsComposite Brands or Bundling of Brands

•• Sales PromotionsSales Promotions

•• New product LaunchesNew product Launches

BRAND STRATEGY DIMENSIONSBRAND STRATEGY DIMENSIONSBRAND STRATEGY DIMENSIONS

CUSTOMER ANALYSISCUSTOMER ANALYSIS

• Trends• Motivation• Segments• Unmet Needs

COMPETITOR ANALYSISCOMPETITOR ANALYSIS

• Brand Image• Strengths• Weaknesses

SELF ANALYSISSELF ANALYSIS

• Existing Brand Image• Brand Heritage• Strengths/ Weaknesses• Brand Soul• Links to Other Brands.

StrategicBrand Analysis

LEVERAGES OF BRAND PROFITABILITYLEVERAGES OF BRAND PROFITABILITYCORPORATE RESOURCES

INVESTMENTS MARKETING INVESTMENTS DISTRIBUTION INVESTMENTS

Productivity, R&DKnow How & Patents

Forecasting Changes ofConsumer Values & Lifestyle

Proximity, Availability andCommunications

Level of Objective QualityCost of Quality

Brand Relevance andAdaptation to Present Market

Brand Awareness, Image,Liking & Familiarity

COMPETITION• Other Brands• DOB’s• Hard Discount

MARKET• Involvement• Price sensitivity• Buying Criteria

PERCEIVED VALUEVIS- À- VIS COMPETITION

SUSTAINABLE PRICEPREMIUM LEVEL

INCREMENTALATTRACTION & ROYALTY

COST ADVANTAGE DUETO MARKET LEADERSHIP

EXTENDED BRAND EQUITY BEYOND IT’S MARKET

ORGANIZATIONAL ASSOCIATIONORGANIZATIONAL ASSOCIATION

THE ORGANIZATION• Culture/ Values• People• Programs• Assets /Skills• Visibility

ORGANIZATIONAL ASSOCIATIONS- Environmentally Sensitive - Concern for Customers- Community Orientation - Presence / Success- Perceived Quality - Local Vs Global- Innovative

VALUE PROPOSITIONOR

CUSTOMERRELATIONSHIP

CREDIBILITY• Expert• Trustworthy• Likeable

INTERNAL CULTURE• Clarity• Buy – In

BRAND HIERARCHY - TERMSBRAND HIERARCHYBRAND HIERARCHY -- TERMSTERMS

Range Brands

Product Line Brand

Umbrella Brand

Source Brand

Endorser Brand

BRAND HIERARCHY- TERMSBRAND HIERARCHYBRAND HIERARCHY-- TERMSTERMS

Family Brand

Sub Brands

Modifier

Flanker Brand

Product Features/ Services

HIERARCHY GUIDELINESHIERARCHY GUIDELINESHIERARCHY GUIDELINES

•• Principle of SimplicityPrinciple of Simplicity :

•• Principle of RelevancePrinciple of Relevance :

•• Principle of DifferentiationPrinciple of Differentiation

•• Principle of ProminencePrinciple of Prominence

•• Principle of CommonalityPrinciple of Commonality

BRAND ROLESBRAND ROLESBRAND ROLES

BRANDROLES

BRANDROLES

ENDORSERENDORSERENDORSER STRATEGICBRANDS

STRATEGICSTRATEGICBRANDSBRANDS

DRIVERDRIVERDRIVER

SILVERBULLETS

SILVERSILVERBULLETSBULLETS

BRANDED BENEFITS

• Features• Components• Service Programs

BRANDED BENEFITSBRANDED BENEFITS

• Features• Components• Service Programs

SUB BRAND ROLES

• Describe Offerings• Structure & Clarify Offerings• Augment/ Modify Brand ID• Exploit Mkt Opportunities• Support Extensions

SUB BRAND ROLESSUB BRAND ROLES

• Describe Offerings• Structure & Clarify Offerings• Augment/ Modify Brand ID• Exploit Mkt Opportunities• Support Extensions

SUBSUB -- BRANDSBRANDS

Distinguishes part of the product line with the brand system

Supports the parent brand identity, and adds value thru :

• DESCRIBE OFFERINGS

• STRUCTURE & CLASSIFY OPTIONS

• AUGMENT / MODIFY IDENTITY THRU ASSOCIATIONCHANGE

• EXPLOIT MARKET OPPORTUNITIES

• SUPPORTS VERTICAL & HORIZONTAL EXTENSION

STRETCHING DOWNSTRETCHING DOWN -- CHALLENGESCHALLENGES

Protect perceived quality associations.

Unfavorable information influences perception.

• Sub Brands: Insulate parent brand even withlower quality

• Price Lowering: Price oriented competition &retail power

BRANDBRAND–– STRETCHING DOWNSTRETCHING DOWN

• Preference for low- cost brand with quality and features.

• Lesser versions as options.

• Challenge – Accommodate downscale versions not weaken

the brand.

New Competitors and Static Market

Emerging Retail Scenario

Technological Changes