[PPT] Strategic Brand Management

Strategic Brand ManagementStrategic Brand Management

WELCOME!!

Soni Simpson

““Brand Team” IntroductionsBrand Team” Introductions Name Personal Demographics

– Who You Work for – What You Do All Day – Undergraduate Focus– What Degree You’re Working on

What Courses You’ve Completed/Are In

Personal Psychographics– Something Fun/Unique About Yourself– What Motivates You– Why You’re Here Tonight

Communicate your personal brand essence

and call to action In :30 please…

Course OverviewCourse Overview What Do You Think You’re Going to Learn this

Quarter?

We’re going to define and refine our thinking about brands, what they are and how to manage them

We’ll build off text, industry experts & studies, guest lecturers, real life experience and class exercises

09/10/03 AGENDA Top Brands Brand vs Product vs Company Product Levels Brand Definition Brand Relevance Power and Corporate Brands Brand Equity Brand Value Good To Great Companies/Hedgehog

Strategic Brand ManagementStrategic Brand ManagementTACTICAL Application•Brand Share•Brand Management•Brand Management Task Models•IN CLASS CASE STUDIES

•Self Positioning•Du Pont Case Study•Due Next Week


The World's 10 Most Valuable Brands - 2002

VALUE ($billions)

1 COCA-COLA 69.6

2 MICROSOFT 64.1

3 IBM 51.2

4 GE 41.3

5 INTEL 30.9

6 NOKIA 30.0

7 DISNEY 29.3

8 McDONALD'S 26.4

9 MARLBORO 24.2

10 MERCEDES 21.0Data: Interbrand Corp., J.P. Morgan Chase & Co /

Business Week AUGUST 5, 2002

Interbrand’s Assessment is of Brand Power – the fullest possible view of each brand’s strengths and potential as a marketing and financial asset.


The Top 10 Global Marketers - 2002

Ad Spending Outside US (MMs)

1 UNILEVER 2,967

2 PROCTOR & GAMBLE 2,610

3 NESTLE 1,560

4 TOYOTA 1,345

5 VOLKSWAGON 1,290

6 COCA-COLA CO. 1,176

7 FORD MOTOR CO. 1,127

8 GENERAL MOTORS 1,028

9 PSA PEUGEOT CITROEN 1,004

10 FIAT 998Data: Global Marketers (Ad Age Global, 11/01)

Ranks advertisers by estimated total measured advertising outside the US

Ad Age Fact Pack; Sept 9, 2002

Strategic Brand ManagementStrategic Brand ManagementThe Top 10 Global Marketers - 2002

Ad Spending Outside US (MMs)

1 UNILEVER 2,967

2 PROCTOR & GAMBLE 2,610

3 NESTLE 1,560

4 TOYOTA 1,345

5 VOLKSWAGON 1,290

6 COCA-COLA CO. 1,176

7 FORD MOTOR CO. 1,127

8 GENERAL MOTORS 1,028

9 PSA PEUGEOT CITROEN 1,004

10 FIAT 998Data: Global Marketers (Ad Age Global, 11/01)

Ranks advertisers by estimated total measured advertising outside the US

Ad Age Fact Pack; Sept 9, 2002


VALUE ($billions)

1 COCA-COLA 69.6

2 MICROSOFT 64.1

3 IBM 51.2

4 GE 41.3

5 INTEL 30.9

6 NOKIA 30.0

7 DISNEY 29.3

8 McDONALD'S 26.4

9 MARLBORO 24.2




The Top 10 US Mega Brands - 2002

US Ad Spending ($MM)

1 AT&T 996.6

2 Verizon 824.4

3 Chevrolet 780.4

4 Ford 655.9

5 Mc Donald’s 635.1

6 Sprint 620.4

7 Toyota 568.3

8 Sears 511.5

9 Dodge 499.2

10 Chrysler 474.4Data: Megabrands, AA July 22, 2002

Media Dollars excluding promotion & direct marketing expenses

Ad spending for CY2001


The Top 10 US Advertisers - 2002

US Ad Spending ($BIL)

1 General Motors 3.37

2 P&G 2.54

3 Ford 2.41

4 Pepsi Co 2.21

5 Pfizer 2.19

6 Daimler-Chrysler 1.99

7 AOL Time Warner 1.89

8 Philip Morris 1.82

9 Walt Disney 1.76

10 Johnson & Johnson 1.62

Data: 100 Leading National Advertisers (AA June 24, 2002)

Ad spending for CY2001 includes advertising, promotion and direct marketing expenses

Strategic Brand ManagementStrategic Brand ManagementThe Top 10 US Mega Brands - 2002

US Ad Spending ($MM)

1 AT&T 996.6

2 Verizon 824.4

3 Chevrolet 780.4

4 Ford 655.9

5 Mc Donald’s 635.1

6 Sprint 620.4

7 Toyota 568.3

8 Sears 511.5

9 Dodge 499.2

10 Chrysler 474.4Data: Megabrands, AA July 22, 2002

Media Dollars excluding promotion & direct marketing expenses

Ad spending for CY2001

The Top 10 US Advertisers - 2002

US Ad Spending ($BIL)

1 General Motors 3.37

2 P&G 2.54

3 Ford 2.41

4 Pepsi Co 2.21

5 Pfizer 2.19

6 Daimler-Chrysler 1.99

7 AOL Time Warner 1.89

8 Philip Morris 1.82

9 Walt Disney 1.76

10 Johnson & Johnson 1.62

Data: 100 Leading National Advertisers (AA June 24, 2002)

Ad spending for CY2001 includes advertising, promotion and direct marketing expenses

What is a Product?What is a Product?Kotler’s

Five levels to a product:

Generic Product

CORE BENEFIT

Expected Product

Augmented Product

Potential Product



CORE BENEFIT

Generic Product

Expected Product

Augmented Product

Potential Product

The Fundamental Need or Want that consumers satisfy by consuming the product or service



CORE BENEFIT

Expected Product

Augmented Product

Potential Product

Generic Product

Basic Version of the product containing only those elements absolutely necessary to function. No distinguishing features.



CORE BENEFIT

Augmented Product

Potential Product

Generic Product

Expected Product

Attributes and Characteristics that buyers normally expect and agree to when they purchase a product



CORE BENEFIT

Potential Product

Generic Product

Expected Product

Augmented Product

Additional product attributes, benefits, or related services that distinguish the product from competitors



CORE BENEFIT

Generic Product

Expected Product

Augmented Product

Potential Product All the augmentations and transformations that a product might ultimately undergo in the future



Generic Product

CORE BENEFIT

Expected Product

Augmented Product

Potential Product


Generic ProductBasic Version of the product containing only those elements absolutely necessary to function. No distinguishing features.

Expected ProductAttributes and Characteristics that buyers normally expect and agree to when they purchase a product

Augmented ProductAdditional product attributes, benefits, or related services that distinguish the product from competitors

Potential ProductAll the augmentations and transformations that a product might ultimately undergo in the future

What is a Brand?What is a Brand?

Not simply a product -- anything offered to a market for attention, acquisition, use, or consumption that might satisfy a need or want.

A product can be:– Physical good– Service– Retail Store – Person– Organization– Place– Idea


Product = Commodity

A product is a produced item always possessing these characteristics:• Tangibility•Attributes and Features

Brand = “Mind Set”

The sum of all communications and experiences received by the consumer and customer resulting in a distinctive image in their “mind set” based on perceived emotional and functional benefits.

Timothy D. Ennis, Ennis Associates, Inc


Derivation– Old Norse “brandr” = to burn – branding livestock

Heritage– A means to distinguish goods from one producer vs

another. AMA (technical definition)

– “Name, term, sign, symbol, or design, or a combination of them, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competition”


AMA defines a brand vs a Brand.What does the AMA definition leave out?


Keller’s Definition:– A product, but one that adds other dimensions that

differentiate it in some way from other products designed to satisfy the same need.

Rational and tangible Symbolic, emotional and intangible

The psychological response to a brand can be as important as the physiological response.


Product = Commodity

A product is a produced item always possessing these characteristics:• Tangibility•Attributes and Features

Brand = “Mind Set”

The sum of all communications and experiences received by the consumer and customer resulting in a distinctive image in their “mind set” based on perceived emotional and functional benefits.


MANUFACTURERS ID to simplify handling or

tracing Legal protection of unique

features Signal of quality level to

satisfied customers Means of endowing

products w/unique associations

Competitive Advantage Financial Returns

CONSUMERS ID Product Source Assignment of

responsibility to maker Risk reducer Search cost reducer Promise, bond, or pact

w/make of product Symbolic Device Signal of Quality

Why Does A Brand Matter?Why Does A Brand Matter?


Products don’t exist in a void… They are bought because consumers have

found something they relate to in them, something which they value

Brand = Credible Guarantee


Relative Brand Distinction– The more distinctive or different a brand is in

the consumers “mind set”, the stronger brand preference becomes. This is critical to keeping competition from the consumer’s consideration.

Strong Brand

Perceived by theConsumer as

Unique

Products(Commodities)

No DifferenceExcept Price

BrandName

Well KnownBut Similar

Brand

Distinctive



Relative Brand Distinction– A brand’s preference is primarily built through

differentiation and relevance– Insulate product from competition– OWN Something



BrandName


Brand

Distinctive

Strong Brand


Unique


Generic Product

CORE BENEFIT

Expected Product

Augmented Product

Potential ProductKotler’s Five Levels

of A Product




BrandName


Brand

Distinctive

Strong Brand


Unique

BRAND DISTINCTION by Timothy D. Ennis

Generic Product

CORE BENEFIT

Expected Product

Augmented Product


of A Product




BrandName


Brand

Distinctive

Strong Brand


Unique


OWN Something


What Makes the Best Brands?– Source of company wealth for generations– Improves with Age– Develop clearly defined personalities– Develop affection & loyalty of the public– Become parents to sub-brands and brand

extensionBrands = Powerful emotional tools

What Is a Brand?What Is a Brand?

Truly understood brands are the things which patrol the boundary between people and the world outside them.

A brand with an emotional difference can potentially command a premium forever.


Case Groups Definition:

Product

Service

Corporation

Brand


Corporation vs Service vs Product

vs Brand

Alternative Branding ModelsAlternative Branding Models

Company dominates Brands

Company is equal to Brands

Brands dominate the Company

American Express (cards)

BMW (Motorcycles)

Colgate (Total toothpaste)

Disney (Films)

General Electric (appliances)

IBM (Technology)

L’Oreal (Cosmetics)

Sony (Electronics)

Holiday Inn (Crowne Plaza)

Anheuser Busch = Budweiser

Campbell Soup = Godiva

Chrsyler = Jeep

Estee Lauder = Clinique

Kraft = Maxwell House

PepsiCo = Mountain Dew

Time Warner = Warner Bros

3M = Scotch Tape

Marriott = Courtyard

Skol (Am Bev)

Claridge Hotel (Savoy)

Crest (P&G)

Healthy Choice (Con-Agra)

Hidden Valley Ranch (Clorox)

Kleenix (Kimberly-Clark)

Marlboro (Philip Morris)

MCA Records (Universal Studios)

Wranlger (VF Jeans)

Kevin Clancy, Copernicus

POWER BRANDSPOWER BRANDS


VALUE ($billions)

1 COCA-COLA 69.6

2 MICROSOFT 64.1

3 IBM 51.2

4 GE 41.3

5 INTEL 30.9

6 NOKIA 30.0

7 DISNEY 29.3

8 McDONALD'S 26.4

9 MARLBORO 24.2



Interbrand’s Assessment is of Brand Power – the fullest possible view of each brand’s strengths and potential as a marketing and financial asset.

The Successful Brands

– Don’t JUST sell products

– Communicate Clear Values

– Stretch Across a Number of Products

– Attached to Consumers/ NOT Products

– Individualized Relationships


Allow Consumers to clearly identify and specify products which genuinely offer added value.

Deep respect for the way products fit into consumer’s lives = “core” of success

Consumer Relationship = Loyalty

Social Changes in their favor


RIGHT MIX = Organization Excellence + Marketing Sensitivity + Long-term Commitment

Brand Values Transcend National Cultures

Emphasize Classlessness, Service, Consistency

– Coke and Mc Donald’s demonstrate most


Assessing BRAND POWER


Interbrand

BRAND DEPTH

BRAND WEIGHT

BRAND LENGTH BRAND BREADTHPOWER

The influence or dominance that a brand has over its category or market (more than just market share)



Interbrand

BRAND WEIGHT

The stretch or extension that the brand has achieved in the past or is likely to achieve in the future (especially outside its original category)



Interbrand

BRAND LENGTH

The breadth of franchise that the brand has achieved both in terms of age spread, consumer types and international appeal



Interbrand

BRAND BREADTH



Interbrand

BRAND DEPTH

The degree of commitment that the brand has achieved among its customer base and beyond. The proximity, the intimacy and the loyalty felt for the brand.



Interbrand

BRAND DEPTH

BRAND WEIGHT


Power Brand = Master Brand? Power Brand = Master Brand?

Manifestation of Brand EssenceA term that USED TO apply only to

overarching family brands (Nestle)NOW applies to entire companies that rally

around a single brand identity– Focus on entire value proposition rather than a

single product’s functionality

Branding the CorporationBranding the Corporation

Brands are not just products but companies:– Ford– IBM– Sony

Why has marketing refocused efforts on the potential of corporate brands?

Cost of creating and supporting product brands has become prohibitive– $1Bil to develop a brand across US, EC, FE

Increasing retailer powerTraditional brand management not as

effective/efficientFocus moving up the value chain


Master Branding the Corporation Enhances Brand…

Clarity– Clear brand priorities

Synergy– Every exposure generates awareness

Leverage– Corporate brand in all Company strategies

Brand Relationship SpectrumBrand Relationship Spectrum

Thus, Benefits of Corporate Branding:– Every marketing dollar benefits each one of a

company’s division/products– Attracts and inspires employees, stakeholders and

business partners– Supplier and Vendor relationships deeper and

longer term– Connects up goodwill generated by operations +

adds public support/PR in crisis


Benefits of Corporate Branding:– New product launches/extensions cheaper and

quicker– Long Term strategic focus– Financial performance and value creation can be

enhanced


What Might be Some of the Difficulties?– Organizations can be extremely complex– Wide variety of audiences make consistent

proposition communication difficult– Too many businesses: Easier to build a rep &

image when one is known for one product or service


What Might be Some of the Difficulties?– Led from the top. CEOs are difficult to pin

down for day-to-day brand management– Business Directors often have finance or

operations backgrounds – not marketing


Class Examples of Master Brands

Master BrandsMaster Brands

BrandingBrandingDifferent outcomes result from the

marketing of a product or service because of its – brand name– brand element– brand identification– WHAT ELSE?

Brand EquityBrand EquityCommon Denominator to interpret the

potential effects and trade offs of various strategies and tactics

Common Denominator for assessing the value of a brand

Brand EquityBrand Equity Fundamentally, stresses the importance of the role

of the brand in marketing strategies.

Marketing effects uniquely attributed to the brand

Represents the ADDED VALUE endowed as a result of past marketing investments.

Bridge between the past and future possibilities

Brand EquityBrand EquityA set of stored values that consumers

associated with a Product/Service. These associations add value beyond the

basic product functions due to past investments in marketing the Brand.


Brand EquityBrand EquityHow can Brand Equity be created?How can Brand Equity be measured?How can Brand Equity be used to expand

business opportunities?

Brand EquityBrand Equity Brand Ingredients:

– Brand Name & heritage– Packaging (structure & graphics) & signage– Brand symbols, properties and logos– Perceived quality, reliability & convenience– Defined level of satisfaction– Meaningful (premium) price/value relationship– Purchase & usage experiences– Consumer perceptions, attitude & behaviors– Emotional associations with the product/services


BRAND GESTALT

Brand Equity Brand Equity

Physical Product

AttributesQuality

Uses

Brand Personality

LogoVisualAppearance

Country ofOrigin

User Imagery

Tangible

Benefits

Emotional

Benefits

Brand Customer

Relationship

Kevin Clancy, Copernicus modified by Soni Simpson

The Coca-Cola Brand Is…

1800’s Heritage The Real Thing

Americana Red & White Striped Can

Vanilla Coke Sold Everywhere

Authenticity Battles with Pepsi

Brand EquityBrand Equity

The Mc Donald’s Brand Is…

The Big Mac Happy Meals

French Fries Red and White Restaurants

Fun For Children Ronald Mc Donald

Golden Arches Value for Your Money


A synthesis of all elements, physical, aesthetic, rational AND emotional.

End result =

– appropriate

– differentiated

– relevant


Brand Imposing One’s Will On

The Consumer

BrandingBranding

OLDSCHOOL

THINKINGDIPLOMA

“ Pretty much everything today can be seen in relation to a love-respect axis. You can plot any relationship – with a person, with a brand – by

whether it’s based on love or based on respect. It used to be that a high respect rating would win.

But these days, a high love rating wins. If I don’t love what you’re offering me, I’m not even

interested.” - Kevin Roberts, Saatchi and Saatchi

BrandingBranding

TradeMark

BrandingBrandingLove * Mark

Trust-Mark

Those Brands which are particularly well adapted to the environment and which thus, survive and flourish.


•Attached to Consumers•Deep respect

for the way products fit into Consumer’s lives

= “Core” of Success

Brand EquityBrand EquityA set of stored values that consumers

associated with a Product/Service. These associations add value beyond the

basic product functions due to past investments in marketing the Brand.


Brand Value BreakdownBrand Value Breakdown

0

20

40

60

80

100

120

Coca-Cola

J&J P&G Unilever Amazon

INTANGIBLE &Goodwill

Net TANGIBLEAssets

$US Billions

Measurable Financial Value

Legal Systems recognize brand value

– Most countries now recognize intellectual property is REAL property w/rights of ownership

Trademarks, Patents, Designs, Copyright

Consumer Value

Brand ValueBrand Value

Brand Value Brand Value Multiple values for a brand Communicated through every medium from shelf to

advertising to editorial to word-of-mouth. Coca-cola

– Bottle shape– Can color– Logo type face– Taste– Youthful messages – FORMULA

Are Brand Values Equal?


Three Tiers of Brand Value– Functional Values– Expressive Values– Central Values

Interbrand; The World’s Greatest Brands.

Central

Expressive

Functional

Brand Value Corresponding to Brand Value Corresponding to Brand Hierarchy PyramidBrand Hierarchy Pyramid


Functional Values: – Govern product performance

Coke refreshes its drinker Volvo gives its driver a safe ride IBM PC provides quick computing

– Don’t differentiate products Pepsi refreshes Mercedes is as safe as Volvo Apple is as quick as IBM

– Brand Owner’s “bright ideas” can be instantly copied in every continent



Expressive Values: – Say less about the product & more about the

consumer– Reflect and enhance the consumer’s sense of

him/herself– Provide a key source of brand differentiation

Marlboro’s - masculine values Armani’s - status and fashionable values Apple - creative and human values



Central Values: – Most Enduring– Right to the Core of the Consumer’s Belief System– At their purest = embodied in religious, national or

political persuasions– Comparable power = embody mass movements or

cultural trends 1960’s Coke “I Like to teach the world to sing” Today= Nike “Just Do It”, Richard Branson’s Irreverent

Virgin



Central

Expressive

Functional

Very meaningful in differentiating our Brand but very difficult to deliver consistently to our consumers

Easy to deliver and explain to consumers but also easy to imitate


Central

Expressive

Functional



Beliefs & Core

Values

Benefits

Features & Attributes


Hierarchy : Timothy D. Ennis, Ennis Associates, Inc

Brand Value: Brand Value: Brand Hierarchy PyramidBrand Hierarchy Pyramid

Beliefs & Core

Values

Benefits


The emotional beliefs and values that consumers feel are being addressed by our brand (CENTRAL)

The functional and emotional benefits that our product/services provides to the consumer (EXPRESSIVE)

Product/Service features and/or attributes that must be addressed (FUNCTIONAL)



Mc Cormick: The Taste You Trust


CENTRAL VALUE

Beliefs and Core Values

EXPRESSIVE

Benefits

FUNCTIONAL


I take pleasure in

how the family enjoys

the meals I prepare

Brand I Trust / Taste You Trust

Part of making food my way

Makes a meal/dish an eating pleasure Makes prepared meals taste better

Brings out the best in foods

Let me adjust to make it my own * Can be used with any dish * Adds flavor, Spicy * For everyday use * Has a lot of

products I use * Easy to find when shopping *

Largest variety of spices, extracts, dry seasonings, and mixes

Brand Hierarchy Pyramid vs Brand Hierarchy Pyramid vs Product LevelProduct Level

Beliefs & Core

Values

Benefits




Generic Product

CORE BENEFIT

Expected Product

Augmented Product

Potential Product

Brand Value Brand Value

OK…Values are Essential…BUT

Are they enough?

What is missing??

Brand Value Brand Value

Values Need to be Harnessed & HonedThe Force

– Brand Builder’s Vision– Big Idea– Conviction

Brand Vision Brand Vision

To build successful brands while your competitors turn their brands into commodities start with a five-step process

Kevin Clancy, Copernicus, Counter Intuitive

Brand BuildingBrand Building

Kevin Clancy Copernicus’s 5 Step Process

InspirationalVision

Transform-ational

Strategy

Model-BasedMarketingPlanning

ObsessiveImplement-

ation

DiagnosticMetrics



Brand Vision LIFTS the Brand above the mundane and functional

Appeals to Expressive and Central VALUES

Process creates a bond with the consumer, and hopefully, long-term loyalty


The First thing you need to do is create a marketing vision to rally your forces.

“Where there is no vision, the people perish.”

Proverbs 29:18


“Something supposedly seen by other than normal sight”

“The ability to see something not actually visible”

“A force or power of imagination”“The experience of having a revelation”“Something supernaturally revealed as to a

prophet”


MUST BE:

Exciting, even inspirational, to all of your stakeholders: customers and prospective customers, managers and employees, analysts, reporters – everyone.



MUST BE:

So big, so bold and so audicious that expressing it – never mind executing it – has a transformational effect. You start to become what you want to be. The dream and the reality fuse. Kevin Clancy, Copernicus, Counter Intuitive

i.e. YOU NEED A BIG HAIRY VISION

Brand Vision ChecklistBrand Vision Checklist Inspirational & uplifting; it moves people Exciting; it gets the blood pumping Aspirational; it is barely attainable Readable; it is clearly communicated Unique/special/different Very specific, not general Connotes superiority or domination Bold and brash; it oozes with confidence Causes people to want to invest in/work for the company or

buy the company’s products Transformational, revolutionary, not evolutionary


Let’s review some published vision statements

Assign them a college grade from 0 to 100.



A beverage company

“We exist to create value for our shareholders on a long-term basis by building a business that enhances the company’s trademarks.”


Grade = 63


A beverage experience company

“To have bigger brand awareness then

Coca-Cola.”

David Sutton, Zyman Marketing

Big Hairy Audacious Goal


A motorcycle company

“Yamaha Wo Tsubusa!”



A motorcycle company

“We will crush, squash, slaughter Yamaha!”


Grade = 85


A technology company

“To eclipse IBM as the #1 technology company in the world.”


Grade = 91


A gasoline company

“We will become the dominant brand in the service station industry and beyond – with the friendliest, fastest, cleanest stations everywhere – one of the most admired brands on the planet.”


Grade = 96

VISION to ASSET LEVERAGEVISION to ASSET LEVERAGE

Tellis and Golder five factors and rationale as the keys to enduring brand leadership

Gerard Tellis & Peter Golder “First to Market, First to Fail? Real Causes of Enduring Market Lendership” MIT Sloan Management Review, 1/1/96

Vision of the Mass Market

Managerial Persistence

Financial Commit-

ment

Relentless Innovation

Asset Leverage

Brand BuildingBrand Building

Kevin Clancy Copernicus’s 5 Step Process

InspirationalVision

Transform-ational

Strategy

Model-BasedMarketingPlanning

ObsessiveImplement-

ation

DiagnosticMetrics



MUST BE:

So big, so bold and so audicious that expressing it – never mind executing it – has a transformational effect. You start to become what you want to be. The dream and the reality fuse. Kevin Clancy, Copernicus, Counter Intuitive


Generic Product

CORE BENEFIT

Expected Product

Augmented Product


of A Product




BrandName


Brand

Distinctive

Strong Brand


Unique


OWN Something



Interbrand

BRAND DEPTH

BRAND WEIGHT


The stretch or extension that the brand has achieved in the past or is likely to achieve in the future (especially outside its original category)



Interbrand

BRAND LENGTH

POWER COMPANIESPOWER COMPANIES


VALUE ($billions)

1 COCA-COLA 69.6

2 MICROSOFT 64.1

3 IBM 51.2

4 GE 41.3

5 INTEL 30.9

6 NOKIA 30.0

7 DISNEY 29.3

8 McDONALD'S 26.4

9 MARLBORO 24.2

10 MERCEDES 21.0

Data: Interbrand Corp., J.P. Morgan Chase & Co /


GOOD – TO –GREAT CASES

Results T +15 yr*

1 Abbott 3.98x

2 Circuit City 18.5x

3 Fannie Mae 7.56x

4 Gillette 7.39x

5 Kimberly-Clark 3.42x

6 Kroger 4.17x

7 Nucor 5.16x

8 Philip Morris 7.06x

9 Pitney Bowes 7.16x

10 Walgreens 7.34x

11 Wells Fargo 3.99x

Data: Ratio of cumulative stock retruns relative to the general stock market

Jim Collins, Good To Great


HEDGEHOG ConceptThe Essential Strategic Difference between

the Good-to-Great companies:– Founded their strategies on deep understanding

along three key dimensions– Translated that understanding into a simple,

crystalline concept that guided all their efforts





What are you deeply Passionate About

What you Can be The Best in the World at

What Drives Your Economic Engine

A Hedgehog Concept:

•Is not a goal to be the best,

•not a strategy to be the best,

•not an intention to be the best

•not a plan to be the best

•It is AN UNDERSTANDING of what you CAN be the best at.





A Hedgehog Concept

“Focusing solely on what you can potentially do better than any other organization is the only path to greatness.”

…Equally important they know what they cannot be best at.

…It is an understandingJim Collins, Good To Great

BHAG





A Hedgehog Concept

“Good to Great Companies know they should only do those things that they can get passionate about.”

“They asked the right questions.”


BHAG





BHAG


BIG HAIRY VISIONS & GOALS

• Bad BHAGs set with bravado,

• Good BHAGS set with understanding

BrandingBranding

How do we measure one brand’s performance vs another brand?

BrandingBranding Brand Share of Market:

– Measuring a brand’s percent of sales in a market– Can be measured nationally, regionally and at retailers – Data captured via

Scanner data (IRI, Nielsen)Industry trends Annual reports

BrandingBranding

Measuring Brand Share of MarketUnit $$ Unit $$Sales Sales Share Share

National 120 $270 100% 100%Brand A 5 15 4.2% 5.6% Brand B 15 15 12.5% 5.6%Brand C 3 7 2.5% 2.6%

BrandingBranding

Measuring Brand Share of MarketBrand Sales

Category Sales = Brand Share

BrandingBranding

Are ALL Brands Created Equally?How Does Brand Usage Compare to Category or Competitive Usage?Are Brands Equally Strong in Different Regions?Measuring Brand DevelopmentUsing Brand Share Metrics

Brand ManagementBrand Management

As much ART as SCIENCEAs much SCIENCE as ARTAchieved by combo of

– Specialist talent– Long term vision– Analytic wizardry

What is Brand Management?What is Brand Management?

Entrepreneurs are building brands (Ben & Jerry’s, Yahoo…)

Creating a whole new brand– Riskiest– Most lucrative

Six to Seven of Ten brands launched fail


Majority of Brand Builders main task – take existing brand legacy– adapt brands to suit the requirements of more

sophisticated consumers.

What is Brand Management?What is Brand Management? Components of Main Brand Builders task

– Embrace the increasing possibilities for communicating brand values

– Acknowledge growing financial pressures on brands to make a return.

– Issue: Agencies are communicators..some given responsibility to modify core brand values…brand owners may run into difficulties with this later..


Marketing as Brand Management’s responsibility is to build long-term profitable growth for the company’s brands.


To accomplish this, marketing must:– Deliver sustained value to consumers– Enhance brand equity by keeping their brands

relevant, fresh and contemporary– Build consumer loyalty towards their brand

What is a Brand Management?What is a Brand Management?

Brand Building Begins By– Understanding & anticipating the needs and

desires of the consumer– Understanding the key attributes of the

product(s)

Our Mission is to DISCOVER (rather than Invent) the brand’s CORE VALUES and abide by them.


Brand = Primitive God– If we keep it’s laws – And pay regularly the tributes due

(mainly advertising), fortune will smile on us – otherwise, disaster.


“You have to maintain and replenish a brand over time or it will die”

Brand Vision and EssenceBrand Vision and Essence

BRAND = Mindset

EQUITY = Roots

ESSENCE = Brand’s Soul

VISION = Brand’s DNA


Functional Excellence in Support of the Brand

Primary Source of Differentiation

• Product/service innovation and communication

Purpose of the Brand

• Create or reinforce product distinctiveness

Firmwide Leadership in Stewarding the Brand

Primary Source of Differentiation

• Customer experience, in addition to innovation and communication

Purpose of the Brand

• Provide clear set of values along which to align all enterprise activities and investments

Corporate Executive Board

What is Brand Management?What is Brand Management?Functional Excellence in Support of the Brand

Marketers Responsibilities

• Deduce customer interests from market research data

• Develop and refine brand strategy

• Control advertising and promotion planning and execution

•Develop new line extensions



• Generate customer insight from all points of customer contact

•Develop & Refine brand values, and translate into expectations for each function and role

•Influence customer experience across all touch-points, from communication through transaction and service

•Leverage brand into new, relevant industries, marketplaces or customer segments


What is Brand Management?What is Brand Management?Functional Excellence in Support of the Brand


• Defend marketing budget

•Base decisions primarily on marketing judgement

•Determine success through intermediate measures (awareness, recall, brand equity)

Brand Architecture

• Multiple, unrelated brands



• Champion shareholder value

• Base decisions on marketing judgement supported by comprehensive customer database and/or modeling of all key inputs and outputs

•Determine success using a dashboard of selected intermediate and bottom-line measures

Brand Architecture

• Single brand or few, interrelated brands


Functional Excellence in Support of the Brand

Locus of Brand Ownership

• Brand Managers


Locus of Brand Ownership

• Chief Marketing Officer



Brand Management is reliant on entire corporation and agency teams

In Operationalizing the brand, the highest priority is to enlist the support of each member of the team


Innovative AnalystsArcheologistsSociologistsPoliticians

General ManagersTemplar Knights of Equity

EvangelistsBrand Stewards

Brand Champions

Parallel Path Strategic Growth Model

(Soni’s Standard Operating Procedure)


Guiding Focused Strategic GrowthGuiding Focused Strategic GrowthParallel Path ProcessParallel Path Process

PATH 2:We’ve got a

Business to Run

PATH 1:Strategic Plan for Long Term

Explosive Growth

$$

BuildingBrands

NOT Growing Products

Interview ALL key internal players, all vendors, & buyers/brokers

Review & analyze business and consumer trends Read all research

on-hand & obtained

Path 1: Strat Plan for High Growth


#1 Full Business Immersion#1

Path 1: Strat Plan for High Growth


Brand Essence/Consumer Insight#2

Vision >>Objectives >>Strategies#3

Full Business Immersion#1

SET STRATEGIC PLAN#5

Full Team Brainstormings#4

Short Term: Running The Business

ASK & Listen

Focus on Immediate Business Issues Ensure All

Priorities & Deadlines are met


Work Current Plan#1

Work Current Plan#1

Path 2: ST Running The Business


Facts vs Folklore#2

Full Team Brainstormings#4

Strat & Tactic Successes/Failures#3

ADJUST SHORT TERM PLAN#5

Work Current PlanFull Business Immersion

Facts vs FolkloreBrand Essence/Consumer Insight

#1

#2

Strat & Tactic Successes/FailuresVision >>Objectives >>Strategies

ADJUST SHORT TERM PLAN

#3

Full Team Brainstorm

SET STRATEGIC PLAN

#4

#5

Path 1: Strat Plan for High Growth Path 2: ST Running The Business


$$

Work Current PlanFull Business Immersion

Facts vs FolkloreBrand Essence/Consumer Insight

#1

#2

Strat & Tactic Successes/FailuresVision >>Objectives >>Strategies

ADJUST SHORT TERM PLAN

#3

Full Team Brainstorm

SET STRATEGIC PLAN

#4

#5

Path 1: Strat Plan for High Growth Path 2: ST Running The Business


$$

BuildingBrands

NOT Growing Products


In Class Exercises: Self Positioning

Case Study

Product and Brand Hierarchy Exercise


SELF POSITIONINGDevelop your own personal positioning statement to share with your group this week. Have your group provide you feedback this week.Define your target audience in the process: what they need to know and why? What makes you unique and why?Have in writing to turn in and share next week.


Five Levels to a Product:

Generic Product

CORE BENEFIT

Expected Product

Augmented Product

Potential Product


Generic ProductBasic Version of the product containing only those elements absolutely necessary to function. No distinguishing features.

Expected ProductAttributes and Characteristics that buyers normally expect and agree to when they purchase a product

Augmented ProductAdditional product attributes, benefits, or related services that distinguish the product from competitors

Potential ProductAdditional Product attributes, benefits, or related services that distinguish the product from competitors

PRODUCT LEVELPRODUCT LEVEL

LEVEL Television or Juice Drink

BRAND Name/Positioning

Potential Product

Augmented Product

Expected Product

Generic Product

Core Benefit


Beliefs & Core

Values

Benefits


The emotional beliefs and values that consumers feel are being addressed by our brand (CENTRAL)

The functional and emotional benefits that our product/services provides to the consumer (EXPRESSIVE)

Product/Service features and/or attributes that must be addressed (FUNCTIONAL)



BRAND HIERARCHYBRAND HIERARCHYLEVEL Television or Juice Drink

BRAND Name/Positioning

Central

Beliefs and Core Values

Expressive

Benefits

Functional

Features and Attributes


Did your output change with the Brand Hierarchy vs the Product Level approach?What about the Consumer?How did you create this brand without the Consumer Insights?What about your BHV?

Documents

[PPT] Strategic Brand Management