END TERM EXAMINATION

MBA FOURTH SEMESTER

MAY-JUNE 2014
ADVERTISING AND BRAND MANAGEMENT
MS 214

Q1 Media planning involves a trade off between reach and frequency. Discuss the
statement, and mention examples when one or the other should get more emphasis.

Ans. Media planning is the series of decisions involved in delivering the promotional
message to the prospective purchasers/users of the product or brand.

It is the process in which a number of decisions are made which may be altered or
abandoned if required. The media plan determines the best way to get the advertisers
message to the market.

Reach is the number of people covered whereas frequency is number of times one is exposed
to the media vehicle. An advertiser has often to trade off between reach and frequency.
He/she must decide whether to have the message seen or heard by more people or by fewer
people more often. Reach is necessary for creating awareness particularly in case of new
brands or products. Frequency helps consumers to remember the message.

The objective of a media plan often call for some combination of reach and frequency.
Media planners want the highest reach possible because that means more people will be
exposed to the campaign, which should lead to more brand awareness, customer loyalty,
sales, and so on. Media planners also seek high frequency if they feel that consumers will
only take action (that is, buy the product) after multiple exposures to the campaign. For
example, launching a new brand or teaching consumers about the features of a product (like
the features of a five-bladed shaving system) may take several impressions.

The goal of the media plan is to find that combination of media that enables the marketer to
communicate the message in the most effective manner to the largest number of potential
customer at the lowest cost.

Thus, reach indicates the media dispersion while frequency shows the media repetition. If a
media plan calls for a broad reach and a high frequency, then it calls for very high GRPs
(lots of ad exposures to lots of people). Achieving a very high GRP is very expensive,
however, and budget issues may preclude such a high GRP. Thus, media planners may start
with budget, then estimate the GRPs that they can afford and then either sacrifice reach to
maintain frequency or let frequency drop to one in order to maximize reach.

Effective frequency refers to the minimum number of media exposures for a communication
goal to be achieved, while effective reach is the reach (% of households) at the effective
frequency level. Media planners choose an effective frequency based on the communication
goals. Communication goals vary across the continuum from awareness, preference, attitude
change to trial, purchase and repurchase. To change brand attitude requires more exposures
(higher effective frequency) than does creating brand awareness. If the effective frequency is
set for a given communication goal, the reach at that effective frequency level will be the
effective reach.
Process of Media Planning:
Step 1 : Market Analysis
Step 2 : Establishment of media objectives
Step 3 : Media Strategy Development and Implementation
Step 4 : Evaluation and follow up

Q.2 Elaborate the different methods used for setting advertising budget of a company
supported by examples?

Ans An advertising budget reflects the importance given to the function of advertising
within a company. The budgeting process is the responsibility of the top management along
with the marketing manager.

The advertising budget is both a planning and control device. There are many managerial
functions that are performed through the process of budgeting. Managerial goals are
discussed and are synchronized with marketing and advertising objectives. This provides
a forum of communication that resolves conflicts and sets the priorities for the
communication plan of the company.
An advertising budget is a plan that sets a limitation on advertising expenditures, states
how expenditure will be allocated and controls the dispersement of expenditure over a
designated period of time.

The process of budgeting is therefore a decision making process that divides the total
appropriation under different expenses heads. For example if the total advertising budget
for launching a new product is rupees two-three crores, then deciding that 1.5crores will be
spent on the national media, is a budgeting decision.

METHODS OF SETTING THE ADVERTISING BUDGET

1. Percentage of sales method
2. Unit of sales method
3. Task and objective method
4. The competitive parity method
5. Brand history method
6. All you can afford method
7. The break even method
8. The quantitative method
9. Share of voice method

1. PERCENTAGE OF SALES METHOD:

The percentage of sales method is the most widely used widely used method of setting the
appropriation, although it has been criticized by many. The percentage is based on the past
years sales or on estimated sales for the coming year or on some combination of these two.
This is simplest method, as it requires little decision making. Many companies in India use
this method to arrive at a tentative budget appropriation. But this method suffers from a basic
drawback in that it does not take into account any specific need of the market situation.
Moreover, when past sales are used to arrive at the current years budget, the figure
may have more historical value rather than current utility. Advertising leads to sales and
the amount of advertising expenditure depends upon the sales target and therefore, when the
percentage of future sales is used the estimates are more realistic.
In conclusion one can say that this method is not appropriate as market situations change
rapidly and past sales alone are not an effective indicator of the companys communication
needs.

2. UNIT OF SALES METHOD:

The unit sales method also relates the advertising expenditure of sales. In this approach,
a percentage of the price of each unit of the item sold is allocated to advertising. Thus a soap
manufacturer might budget that a cake of soap costing Rs.6/- will have Rs.1.50 as the
advertising expenditure. Thus, if the manufacturer sells one lakh units, his expenditure on
that brand will be Rs.1.5 lakh. This approach is useful as it links the price of a brand
advertising expenditure. This approach is simple to plan and execute. However, it does not
lead to efficient marketing since past sales determine how much a firm should
spend on advertising, when in fact advertising is a tool to create sales and
expand markets. This also assumes that the advertiser is satisfied with the current rate
of growth in sales. This is rarely so, as every advertiser aims at improving the rate of growth.
In conclusion the unit of sales and percentage of sales method are not suitable to a dynamic
market situation. However they are useful guides to give direction to planners who use them
as a basis for deciding the ad budget, in combination with other methods.

3. TASK OBJECTIVE METHOD:

This method is gaining more popularity because it provides a more logical basis for deciding
advertising appropriation. The objective task method concentrates on the
marketing/advertising objectives that are pre-decided and ask these questions: what is
the role of advertising in obtaining these objectives? How much should we spend to
achieve these objectives?
Thus under this method a company launching a new product will decide to spend more
money as it has to create immediate awareness amongst consumers.( for example Ranbaxy
will spend more on its new product Olesan). For an existing well know brand, the company
may spend less on advertising (for example Ranbaxy will spend less to advertise its product
Garlic Pearls.)
As it is obvious in the above example, the objective task approach directs the efforts of
manufactures to think through the objective while setting the budget.
There is one problem involved in the use of this method of setting the appropriation and that
is: how does one determine just how much advertising and what type of advertising will
achieve the stated objectives. The present methods of research do not give a direct link
between advertising expenditures and achievement of the objectives.

4. THE COMPETITIVE PARITY METHOD:

This is the most controversial method and few executives admit that they use it
while preparing the budget. In this approach an advertiser bases his budget decision
primarily on the expenditures of competitors. That is they try to keep pace with their
competitors advertising budgets. This method could be useful in deciding individual brand
ad expenditures. It has the advantage of recognizing the importance of competitors
and ensure that the competitors do not increase their ad expenditure to a level that affects the
advertisers sales. But the approach has disadvantages. Firstly your objective may
be different from that of your competitors. And secondly it assumes that your
competitors are spending optimally. It also maintains the present market position rather than
bringing any positive change for the company. If you want to overtake your competitors you
may have to spend more than them and spend this money more efficiently.

5. BRAND HISTORY METHOD:

Under this method the brands product life cycle is considered while setting the budget.
Thus a brand at the introductory or pioneering stage will use more advertising
appropriation than an established brand. Brands that are facing a decline may also use
more advertising to add new life into it. For example Close Up, the toothpaste
manufactures by Hindustan Lever had a stagnating market share till recently. In 1990 it
spent Rs. 3.45 crore on television advertising with its new theme close up: a mouth
wash in tingling red and blue colours. The result was that close up has over taken Promise
and is now number two in the toothpaste market behind Colgate.

6. ALL YOU CAN AFFORD METHOD:

This approach means that the advertising budget will be decided on the basis of whatever
money is left after all other fixed and unavoidable expenses have been allocated.
This method seems to be illogical and unambitious but conservative management use
this method as it is safe and ensure that there is no overspending. New entrepreneurs have
no other option but to follow this method when they are short of funds.

7. THE BREAK EVEN METHOD:

The break even or the marginal analysis method attempts to quantify the advertising
spending level that will offer an organization the highest additional gross profits. That is the
firm continues to spend on the advertising as long as the incremental expenditure are
exceeded by the marginal revenue they generate, thus maximizing the gross profits of the
firm.

This method has an advantage because it helps in diagnosing any problem, that is when the
company is overspending or under spending. But it suffers from the disadvantage of limited
research techniques that cannot isolate the effect of advertising on marginal revenues and
gross profits. Other activities such as personal selling and sales promotions also
influence the revenue earned by a company. Moreover, it assumes that there is an
immediate effect of advertising expenditure. This is possible in direct mail advertising. In
most other advertising there is a carryover effect that is a potential consumer may be
influenced by the ad, in the month of June but may make a purchase in December.
Advertising may also attract customers who become loyal customers for several years. The
immediate purchase measures up to only a small part of the value the firm enjoys
from such continuous purchases. This drawback can be overcome by using the
experimental method.

Q3 What are the factors effecting Media Planning? Discuss them in detail to develop
media strategies.

Ans Media planning is the series of decisions involved in delivering the promotional
message to the prospective purchasers/users of the product or brand.
It is the process in which a number of decisions are made which may be altered or
abandoned if required. The media plan determines the best way to get the advertisers
message to the market.
The goal of the media plan is to find that combination of media that enables the marketer to
communicate the message in the most effective manner to the largest number of potential
customer at the lowest cost.

Factors affecting media planning:

1. Marketing Plan
a) Product Characteristics : It decides the media to be sued by the advertiser.
b) Channels of distribution : Each member of channel is a link in a distribution
network of producer to the end users of products or services.
c) Promotional Strategy : It serves three essential roles; it informs, persuades and
reminds potential customers about a company and its products.
d) Nature of advertising copy : The advertising message itself plays an important part
in making choice for the advertising media.

2. Media Plan
a) Media Characteristics : Advertising message goes to the target audience through
media to the communication channels. Hence media plays an important role.
b) Media discounts : The kind of discounts offered by the media owners.
c) Media cost efficiency : Economy in cost per audience wherein the total audience and
the total cost is taken on to account.
d) Media availability : The availability of space or time may also determine the media
choice.
e) Media objectives : The objectives are guidelines-laying out just what is required of
the plan.

3. Advertising Plan
a) Competitive advertising : A medium which suits to the specific needs of the
advertiser irrespective of the medium used by the competitors.
b) Size of budget : It should be based on the potential contribution that advertising can
make to the attainment of the companys operating objectives.
c) Advertising Strategy : Identifying the consumer characteristics along with
descriptive media is required.

Process of Media Planning:

Step 1 : Market Analysis
Step 2 : Establishment of media objectives
Step 3 : Media Strategy Development and Implementation
Step 4 : Evaluation and follow up

Situation Analysis
Strategy and targets (business/brand/consumer)
Market Situation and competition analysis
Marketing and media objectives
Objectives
Definition of communication objectives
Cognitive-oriented objectives (awareness, recall)
Affective-oriented objectives (interest, brand positioning, brand development, brand
management)
Conative-oriented objectives (purchase intentions, customer loyalty)

Target Group Analysis

Target group identification: two step segmentation process
Definition of core target groups based on
- Demographic characteristics (age, gender)
- Psychographic characteristics (interests, buying habits)
- Socioeconomic characteristics (occupation, social status, income, buying power)
- Behavioural characteristics (buying behaviour, decision behaviour)

Strategic Media Planning

Campaign strategy (duration, timing, recency/burst strategy)
Media mix and budgeting
Advertising impact
Ad specials

Detail Planning/Optimization
Detail planning for each media channels
Availability
Dates of publication
Selection of time slots
Positioning within the magazine or commercial break

Purchasing
Booking (order management, production plans)
Job handling (artwork, tapes)
Rescheduling/optimization

Completion
Controlling, documentation
Invoicing

Evaluation/Controlling
Campaign performance
Planning, purchasing efficiency
Competition reporting

Negotiations/Discounts
Special conditions, performance optimization
Client-specific agreements
Q4 What do you mean by advertising effectiveness? Explain pre and post campaign
measures to evaluate effectiveness.

Ans Advertising effectiveness pertains to how well a company's advertising accomplishes

the intended. Small companies use many different statistics or metrics to measure their
advertising effectiveness. These measurements can be used for all types of advertising,
including television, radio, direct mail, Internet and even billboard advertising. A company's
advertising effectiveness usually increases over time with many messages or exposures. But
certain advertising objectives can be realized almost immediately.

Reach

One metric for advertising effectiveness is reach. This measurement pertains to the number
of people who actually saw a company's advertising. Small business owners usually know
how many people can potentially see their ads. Local television stations report the number of
viewers for certain shows. Similarly, magazines report circulation figures. But not all of
these viewers or readers notice the ads. That is why small business owners often use market
research surveys to measure reach. For example, 10 percent of a local restaurant's viewing
audience may recall seeing their latest television ad. Advertising should be designed to
attract attention, build interest and prompt action, according to the experts at "Mind Tools"
online.

Sales and Profits

One of the most important objectives of advertising is to increase sales and profits. A
profitable ad is an effective one. The best way to build sales and profits is by reaching the
right target audience. In other words, small business owners must make sure their advertising
reaches the people who are most likely to purchase their products. Companies often develop
customer profiles from warranty cards or marketing research to gather this information.
Target audience variables or demographics can include age, gender, income and education.
For example, a high-end women's clothing retailer may effectively drive sales and profits by
targeting women with higher incomes.

Brand Awareness

Brand awareness is another metric of advertising effectiveness. Brand awareness is the

percentage of people who recognize a company's brand of products. It usually takes many
years and lots of ad exposures to build high brand awareness. Television and radio are two of
the best mediums for building brand awareness. Small companies can also build their brand
awareness on the Internet by advertising in online Yellow Pages, or promoting their wares
through major search engines like Google and Yahoo.

Testing Advertising Effectiveness

Small companies can test their advertising effectiveness in several different ways. One way
is to insert certain "word flags" into the advertising messages, according to "Entrepreneur."
This may be a simple phrase or word that customers recognize and can, therefore, mention
when inquiring from an advertisement. The word flag can also be in the form of a question.
For example, a small restaurant company may prompt customers to ask, "What's the super
special of the day?" The restaurant owner can then track the number of people who ask about
the super special throughout the day. Those who use direct mail can insert codes on order
forms. For example, a mail order operator would know that order forms with the "215" code
came from a mailing on February 15.

PRE-TESTING

This refers to testing the campaign before it has run. The purpose of pretesting is to
detect weaknesses or flaws in the campaign that may result in consumer indifference or
negative response. This increases the likelihood of preparing the most effective
advertising message. All the areas of advertising like-markets, motives, messages, media,
budgets and scheduling may be tested.

It may be done to test two types of effects: communication effects and sales effects.
Pre-testing of advertising effects seeks to determine whether advertising objectives such as
awareness, recall, attitudes and opinions, beliefs about the product and intentions to buy,
have been achieved. Pretesting of sales effects seeks to determine whether a proposed
message or media plan has resulted in increased sales. This type of pretesting
identifies and isolates the influence of advertising on sales. A number of more
advanced techniques are used for pretesting both communication effects and sales
effects, both in the print and broadcast media. This brings us to the question how
campaigns should be tested.

Given that most advertising is assigned the task of achieving specific communication goals,
a number of methods have been developed for pretesting these communication effects.
These may be broadly grouped under three categories:
Opinion and attitude tests
Mechanical laboratory methods and
Projective techniques.

OPINION AND ATTITUDE TESTS

1. Direct Questioning: This is a method designed to obtain a full range of responses of

the advertising, by asking direct questions about the advertising. Based on the responses,
researchers can infer how well the advertising messages convey the key copy points.

2. Focus Groups: This is another commonly used method to pretest print ads at both
the conceptual and finished stage. It is a free- wheeling discussion conducted among
small groups of people and led by a moderator. The group may be interviewed on their
reactions to advertising concepts or finished campaigns. The advantage of this
method is that it is an inexpensive and quick way of obtaining insights into the advertising
process. Focus groups are used extensively by Indian advertisers.

3. Dummy advertising media vehicles: This is a technique that can be applied to

both print and broadcasting ads. It involves placing the test ads in a dummy vehicle,
which resembles the actual advertising medium. In case of television commercials, the
effectiveness of these may be tested by showing respondents an actual television
programme, with the test commercials placed within it. Questions are then asked to
measure the extent on which people recalled the test commercials.

4. Order-of-merit test: this is used mainly for pretesting print ads in finished form. A
group of people are shown a series of advertisements, sometimes as many as six or
seven, and asked to place them in rank order, based on some communication criterion, such
 as liking:. After all the ads have been ranked, a composite score is obtained. This score
shows which ad was ranked no.1, no.2, and so on.

5. Paired comparisons: This is used when more than six or seven ads have to be rank
ordered. Consumers are then asked to judge two ads at a time, and asked to choose which
one is better. The process continues until each advertisement has been paired with each of
the others.

6. Live Telecast tests: Here, test commercials are shown on closed-circuit or cable
television. Respondents are then interviewed on the phone to test their reactions.

7. Attitude Ratings: In an earlier section, we defined attitudes as liking or dislike

for a brand. Similarly, people may also form positive or negative attitudes towards ads. It
is possible to measure attitudes towards ads using quantitative research techniques such as
attitude rating scales.

The most commonly used type of attitude rating scale is the semantic
differential. Under this method, respondents are asked to indicate on a seven point scale,
their liking for an ad, on various dimensions.

MECHANICAL LABORATORY TESTS

These are commonly used in US and other developed countries. These include:

1. The tachistoscope: It is used to measure consumer perceptions to ads. Using this

device, the researcher can tell how long it takes for respondents to get the intended message
and how they perceive it.

This way two alternative layouts may be tested for their effectiveness.

2. The eye camera photographs the movement of peoples eyes while reading ads.

3. The psychogalvanometer is a device similar to lie-detector. It records skin

temperatures and tension resulting from reading ads. The theory behind this concept is
that the more tension an ad creates, the more successful it is likely to be.

4. The pupillometer is a device that measures a persons pupil size when exposed to
visual stimuli such as ads. The theory behind it is that the size of the pupil increases when
the person finds the ad visually interesting or emotionally appalling.

PROJECTIVE TECHNIQUES

It is a type of qualitative or motivational research adapted from clinical psychology.

It permits the respondents to direct questioning, projective techniques permits respondents to
indirectly project their views or feelings about the advertising situation. The following types
of projective techniques are used:

1. Depth interviews: Here, respondents are shown advertising material and promoted to
discuss it freely. A trained interviewer, usually a psychologist, probes the respondent
about his underlying feelings and motivations.
2. Word Association and Sentence Completion Tests: These are a little more
structured than the depth interview. Key words or sentences are used as stimuli, to
which the respondent replies by projecting his thoughts. These words and sentences
are taken from ads being tested. This way, the researcher can determine what they mean
to the consumers.

3. Thematic Apperception Tests: In this method, pictures of people in ambiguous

situations are shown to respondents. Respondents are asked to build a story around
these pictures, by projecting their opinions and feelings into the story.

The problem with using projective techniques to measure advertising

effectiveness is the expenses involved, including the cost of training interviewers to evoke
useful responses from respondents.

POST- TESTING

It is applied after the advertisement has ended to find out how far advertising has been
successful. The objective of advertising is to arouse consumer awareness, his interest, desire
and develop his attitude to the product. These are
recognition tests,
recall tests,
attitude change,
sales and recognition tests

Recognition test:

It is developed by Danial Starch. It measures the readership of printed advertisements. It is

also called the readership test. It is based on the assumption that there is a high correlation
between the reading of the advertisement and the purchase of the product. A particular
advertisement may be examined by sending the whole newspaper or magazine wherein it is
published. Afterwards readers are approached to find out whether they have read the
advertisements or not.

The percentage of readership who have seen the advertisement and remember it, who recall
seeing or reading any part of it, identifying the product and brand, and who reported reading
at least one half of the advertisement is calculated. The relationship between readers per
rupee and the median readers per rupee can be established. The advantage is that it measures
something which has been realized under normal conditions. The recognition tests show the
importance of each type of advertisement on the basis of the readership test. This is an
uncontrolled interview and suffers from the problems of uncontrolled techniques of
examination.

Recall Tests:

A recall test depends on the memory of the respondents. This test is applied to measure the
impression made by an advertisement on the reader's mind. It is classified into two types
aided recall and unaided recall. Some have combined the two and made it a combined recall
test.

Aided Recall: It is used to measure the reading memory of magazine advertising

impressions. It is necessary to use a large sample size for statistical reliability. The aided test
measures television advertising. The interviewer may approach the respondents over the
telephone or in person to find out something about their recall of the commercial. A radio
advertisement may be given the aided recall test followed by an unaided question. For
example: "What products have been advertised during the last two days?" Then the recall aid
is provided by asking: 'Have you heard the advertisements of brand X? The recall test may
be administered immediately or two or three days after the exposure.

Unaided Recall: Under this method, little or no aid is given. The purpose is to
measure the penetration of the advertisement. Respondents are asked whether the
advertisements included a particular picture or message. The name of the product is not
given to the audience. They have to recall it themselves. If they do remember, it is
established that there was some impact of the advertisement.

Combined Recall Tests: It includes aided as well as unaided recall tests. This test
was developed by Gallup and Robinson. Respondents are asked whether they have read the
magazine or newspaper, or listened to the radio or watched television.

The limitation of the test is the heavy cost involved in the study. It is affected by the
variation in human memory. The audience may recall because it has seen the previous
advertisements of the product.

Attitude Change

There are several techniques for the measurement of attitude change after the advertising has
ended. These techniques are as follows:
Semantic differential,
Likert scale,
Ranking techniques and
Projective technique.

(i) Semantic Differential: It is used to measure attitude in the field of marketing and
advertising research. It uses a bi-polar (opposite) adjective statement about the subject of
evaluation. The attitude is measured in the light of some objectives. The two-way scale is
used for the purpose. The neutral is mid-point, while the three points on both the sides of the
neutral point, on the same scale, provide the degree of favourable and unfavourable
characteristics.

(ii) The Likert Scale: The Likert scale is used to measure audience attitude to
advertisements. A series of statements are described to measure the attributes of the
advertisement. Only the relevant statements are used for the purpose. Each statement is
measured on a five-point scale. It is being illustrated as follows:

(iii) Ranking techniques: The preferences to several types of advertisements are ranked to
find out the place of a particular advertisement among the several advertisements. An
advertisement of one product can be measured with the advertisements of other products
taken together. This is done to find out the effectiveness of the advertisement in a
competitive atmosphere. The winner may be given rank 1 and loser is given rank 5. The
ranking is based on awareness, interest, attitude change, attractiveness, usefulness,
entertaining respect, effectiveness, etc. A sufficient number of consumers are selected for a
sample survey. The overall rank is summed up to determine the final rank of the
advertisement of the brand.
(iv) Projective Techniques: It is used to measure attitude change. Association techniques,
completion techniques, construction techniques and expressive techniques are used to
measure the change in attitude.

Sales Test

It is designed to evaluate the effects of advertising on the purchase behaviour of the

consumer. It is successfully applied to examine the consumer behaviour to advertisements of
consumption goods. Sales are effected after creating an image of and interest in, the product.
With the help of sales audit and audience response, it is possible to evaluate the effects of
advertising on sales. There are generally three types of sales tests, viz.,
Measure of past sales,
Field experiments, and
Matched samples.

(i) Measure of Past Sales: Advertising and sales are correlated by using the past sales data.
The past data on sales are diversified and their advertising expenses are correlated to
establish their relationship Sales data for the past ten years as well as the advertising
expenses are collected and tabulated to establish the correlation between the sales volume
and advertising expenses. All other factors influencing sales are also correlated with the
sales. The differences between their correlations show the importance of each individual
factor influencing sales.

(ii) Field Experiments: Field experiments may show the extent to which a particular
advertising campaign has affected sales. The whole market may be divided into test and
control areas. One treatment may be randomly administered to each area to know how a
particular factor has influenced the sales in that area. The different treatments may be used to
eliminate irrelevant variables. The results of each variable are recorded for different periods.
These figures give the total impact of advertising on sales.

(iii) Matched Samples: The respondents belonging to the same age, educational status,
occupation, sex, etc. are selected for comparison of advertising effectiveness. They are
matched in every respect but not for the test treatment. One group has seen the
advertisements and other group has not seen the advertisements. The sales of the treated
group should he higher than those of the not-treated group. This would show the difference
between the sale of the advertised products and of the non-advertised products.

Q5 What is brand positioning? Critically evaluate the positioning strategies of cellular

services companies in India.

Ans Positioning is also defined as the way by which the marketers attempt to create a
distinct impression in the customer's mind.

A company, a product or a brand must have positioning concept in order to survive in the
competitive marketplace. Many individuals confuse a core idea concept with a positioning
concept. A Core Idea Concept simply describes the product or service. Its purpose is merely
to determine whether the idea has any interest to the end buyer. In contrast, a Positioning
Concept attempts to sell the benefits of the product or service to a potential buyer. The
positioning concepts focus on the rational or emotional benefits that buyer will receive or
feel by using the product/service. A successful positioning concept must be developed and
qualified before a "positioning statement" can be created. The positioning concept is shared
with the target audience for feedback and optimization; the Positioning Statement (as defined
below) is a business person's articulation of the target audience qualified idea that would be
used to develop a creative brief for an agency to develop advertising or a communications
strategy.

Differentiation in the context of business is what a company can hang its hat on that no other
business can. For example, for some companies this is being the least expensive. Other
companies credit themselves with being the first or the fastest. Whatever it is a business can
use to stand out from the rest is called differentiation. Differentiation in todays over-
crowded marketplace is a business imperative, not only in terms of a companys success, but
also for its continuing survival.

Brand Positioning for Cellular Companies

Positioning and branding are closely related advertising concepts. Positioning refers to a
strategy for communicating superior benefits of your brand to targeted customers. Branding
is the process of building a distinct image for your company or products. Developing a
strong brand image helps you more effectively establish your position in the marketplace.
Companies usually focus on a particular type of positioning approach in building brand
success.

1) User
One approach to positioning your brand is to focus on a specific user, or type of customer.
Airtel uses this positioning approach in many of its ads where it targets young generation.
The company presents messages showing Har Ek Friend Zaroori Hota Hai, this ad had
impact on the minds of young generation that Airtel is for their usage and the plans were also
made keeping in mind its target customers (youngsters).

2) Benefit
Benefit positioning is common when a brand offers one or more superior benefits relative to
competition, or when a particular benefit is a major selling point to a target customer group.
Idea highlights its benefits to the customers with its ad No Ullu Banaing, which educates
the customers about the benefit of Internet on every mobile.

3) Competitive
In highly competitive industries, companies try to develop a brand by comparing their
benefits directly to those offered by competitors. All the cellular services providers have a
very close competition in terms of services whether it is GSM (Idea, Airtel, Vodafone etc) or
CDMA (Tata, Reliance).

4) Price-Driven
While branding often refers to the process of building up an image of worth in your products,
a small number of companies in most industries use a low-price approach to positioning.
MTS has very less frequency of ads and also it doesnt have any brand ambassador to
convey the message.
Q6 What do you mean by brand equity and also explain how do you measure brand
equity?

Ans Brand Equity is the sum total of all the different values people attached to the brand, or
the holistic value of the brand to its owner as a corporate asset. Brand Equity can include: the
monetary value or the amount of additional income expected from a branded product over
and above what might be expected from an identical, but unbranded product: the intangible
value associated with the product that can not be accounted for by price or features; and the
perceived quality attributed to the product independent of its physical features. A brand is
nearly worthless unless it enjoys some equity in the marketplace.

Brand Equity Models

1. Customer Based Brand Equity Model

According to this model, building a strong brand involves 4 steps:
Establishing a proper brand identity i.e., establishing the breadth and depth of
brand awareness.
Creating the appropriate brand meaning through strong, favourable and unique
brand associations.
Eliciting positive, accessible brand responses.
Forging brand relationships with the customers that are characterized by intense,
active loyalty.

Salience Dimensions:
Depth of brand awareness
- Ease of recognition & recall
- Strength & clarity of category membership
Breadth of brand awareness
- Purchase consideration
- Consumption consideration

Performance Dimensions:
Primary characteristics & supplementary features
Product reliability, durability, and serviceability
Service effectiveness, efficiency, and empathy
Style and design
Price

Imagery Dimensions:
User profiles
- Demographic & psychographic characteristics
- Actual or aspirational
- Group perceptions - popularity
Purchase & usage situations
- Type of channel, specific stores, ease of purchase
- Time (day, week, month, year, etc.), location, and context of usage
Personality & values
- Sincerity, excitement, competence, sophistication, & ruggedness
History, heritage & experiences
- Nostalgia
 - Memories

Judgement Dimensions:
Brand quality
- Value
- Satisfaction
Brand credibility
- Expertise
- Trustworthiness
- Likability
Brand consideration
- Relevance
Brand superiority
- Differentiation

Feeling Dimensions:
Warmth
Fun
Excitement
Security
Social approval
Self-respect

Resonance Dimensions:
Behavioral loyalty
Attitudinal attachment
Sense of community
Active engagement

2. Aakers Brand Equity Model

Aaker defines brand equity as the set of brand assets and liabilities linked to the brand
its name and symbols that add value to, or subtract value from, a product or service.
These assets include brand loyalty, name, awareness, perceived quality and associations.

This model can be used to get to grips with a brands equity and gain insight into the
relation between the different brand equity components and (future) performance of the
brand. It goes without saying that brand equity will rise as brand loyalty increases, brand
name awareness increases, perceived quality increases, brand associations become
stronger (and more positive), and the number of brand-related proprietary assets
increase.

1. Brand Loyalty
The extent to which people are loyal to a brand is expressed in the following
factors:
- Reduced marketing costs
- Trade leverage
- Attracting new customers
- Time to respond to competitive threats
 2. Brand Awareness
The extent to which a brand is known among the public.

3. Perceived Quality
The extent to which a brand is considered to provide good quality products can be
measured on the basis of the following five criteria:

- The quality offered by the product/brand is a reason to buy it.

- Level of differentiation/position in relation to competing brands
- Price
- Availability in different sales channels.
- The number of line/brand extentions.

4. Brand Association
Associations triggered by a brand can be assessed on the basis of the 5 following
indicators:

- The extent to which a brand name is able to retrieve associations from the
consumers brain.
- The extent to which association contribute to brand differentiation in relation
to the competition.
- The extent to which brand associations play a role in the buying process.
- The extent to which brand associations create positive attitude/feelings.
- The number of brand extensions in the market.

5. Other proprietary assets

Examples are patents and intellectual property rights, relations with trade partners,
and airlines landing slots (the more proprietary rights a brand has accumulated, the
greater the brands competitive edge in those fields)

3. Brand Asset Valuator

Brand Vitality
Differentiation Differentiation is the ability for a brand to stand apart from its
competitors. A brand should be as unique as possible. Brand health is built and
maintained by offering a set of differentiating promises to consumers and
delivering those promises to leverage value.
Relevance Relevance is the actual and perceived importance of the brand to a
large consumer market segment. This gauges the personal appropriateness of a
brand to consumers and is strongly tied to household penetration (the percentage
of households that purchase the brand).

Brand Stature
Esteem Esteem is the perceived quality and consumer perceptions about the
growing or declining popularity of a brand. Does the brand keep its promises? The
consumers response to a marketers brand-building activity is driven by his
perception of two factors: quality and popularity, both of which vary by country
and culture
Knowledge Knowledge is the extent of the consumers awareness of the brand
and understanding of its identity. The awareness levels about the brand and what it
 stands for shows the intimacy that consumers share with the brand. True
knowledge of the brand comes through brand-building.

Q7 Some of the companies in India have undertaken a process of corporate rebranding

like Airtel. Why would a company invest millions of rupees in creating a symbol or sign
which is ambiguous and mean little to an average mind? Explain using the identity
perspective.

Ans
The mission of a companys logo is to portray the values and goals of the company.
These should be clearly established before venturing out to find a logo designer.
The company should be clear about the message it wants its brand to convey so that the
logo can clearly reflect that message. Strong association between the brand and the logo
is must.
Logo should reflect professionalism and growth no matter how small the company is.
If the company is designing logo in-house to save money be sure to market-test the
efforts.
Make sure that the logo selected is not dated but can be used effectively year after year.
Keep in mind it is how consumers will recognize the company.

Confident branding and a strong branding strategy uses design to communicate a message
that attracts the target audience that the company wants to attract - a message that creates
confidence in the brand while differentiating between the company and its competitors. Does
the logo fulfill this mission? If the answer is no it may be time to consider strengthening the
brand strategy and looking at a new logo to re-position the company.

Purpose
Corporate logos are intended to be the "face" of a company: They are graphical displays of a
company's unique identity, and through colors and fonts and images they provide essential
information about a company that allows customers to identify with the company's core
brand. Logos are also a shorthand way of referring to the company in advertising and
marketing materials; they also provide an anchor point for the various fonts, colors and
design choices in all other business marketing materials.

Design Principles
Good logos should be unique and comprehensible to potential customers. Although there are
myriad choices for color, visual elements and typography, in general a logo should help
convey some information about the company, or be designed in a way that gives some sense
of meaning about the company or its industry. For example, cutting-edge firms and tech
companies tend to have angular logos to convey speed, while service-oriented firms have
rounded logos to provide a sense of service and trust.

Brand Identity
Logos are the chief visual component of a company's overall brand identity. The logo
appears on stationery, websites, business cards and advertising. For that reason, a well-
designed logo can contribute to business success, while a substandard logo can imply
amateurishness and turn off potential customers. However, a logo should cohere well with
other aspects of a company's visual presentation: No logo, however well designed, can look
good when surrounded by contradictory graphical elements or inconsistent fonts. This is why
a logo is the basic unit of a larger brand identity that includes company fonts, colors and
document-design guidelines.
Return on Investment
As consumers grow to know, like and trust a specific brand, they are more likely to respond
positively to successive encounters with a logo--potentially leading to increased sales or
improved mind share within the target market. In addition, a well-designed logo implies a
degree of professionalism and competence that could help steer potential new clients toward
selecting the business rather than a competitor with no or substandard logos.

Q8 Answer any three out of the following:

Ans

a) Brand Pyramid
A brand is a name, term, sign, symbol or design, or a combination of these, that is
intended to identify the goods and services of one business or group of businesses and to
differentiate them from those of competitors.

A model of brand pyramid is suitable for analyzing and understanding the concepts of
brand identity.

The pyramid model consists of three tiers. The fundamental and upper part of the brand
pyramid is the brand core, which remains fairly fixed over time.

The middle tier of the pyramid is called the brand style. It articulates the brand core in
terms of the culture it conveys, its personality and its self-image.

The base layer of the pyramid comprises the brand themes. These themes indicate ho the
brand currently communicates e.g., through its advertising, press releases, and
packaging. Brand themes include the physique of the brand (e.e., colour, logo,
packaging), its reflection (e.g., type of spokesperson used to advertise the brand) and the
relationship expressed (e.g., glamour, prestige). Brand themes are more flexible than the
brand style and brand core, and will change easier with fashion, style or technology.

b) 3Cs of positioning

Brand Positioning is the act of designing the companys offer so that it occupies a
distinct and value placed in the mind of the target customers.

It is the process of promoting buyers to form a particular mental impression of

companys product relative to its competitors.

3Cs
Be Crystal Clear.
Be Consumer- Based:
o Be relevant and credible to the consumer.
o Write in consumer language and from consumer view point.
Be Competitive:
o Be distinctive
o Focus on building brand elements into powerful discriminator
o Be persuasive
o Be sustainable
c) Aaker model of brand equity

Aaker defines brand equity as the set of brand assets and liabilities linked to the brand
its name and symbols that add value to, or subtract value from, a product or service.

These assets include brand loyalty, name, awareness, perceived quality and associations.

This model can be used to get to grips with a brands equity and gain insight into the
relation between the different brand equity components and (future) performance of the
brand. It goes without saying that brand equity will rise as brand loyalty increases, brand
name awareness increases, perceived quality increases, brand associations become
stronger (and more positive), and the number of brand-related proprietary assets increase.

6. Brand Loyalty
The extent to which people are loyal to a brand is expressed in the following factors:
- Reduced marketing costs
- Trade leverage
- Attracting new customers
- Time to respond to competitive threats

7. Brand Awareness
The extent to which a brand is known among the public.

8. Perceived Quality
The extent to which a brand is considered to provide good quality products can be
measured on the basis of the following five criteria:
- The quality offered by the product/brand is a reason to buy it.
- Level of differentiation/position in relation to competing brands
- Price
- Availability in different sales channels.
- The number of line/brand extentions.

9. Brand Association
Associations triggered by a brand can be assessed on the basis of the 5 following
indicators:
- The extent to which a brand name is able to retrieve associations from the consumers
brain.
- The extent to which association contribute to brand differentiation in relation to the
competition.
- The extent to which brand associations play a role in the buying process.
- The extent to which brand associations create positive attitude/feelings.
- The number of brand extensions in the market.

d) DAGMAR
D - Define
A - Advertising
G - Goals for
M - Measurin
A - Advertising
R - Results
 DAGMAR model was developed by Russell Colley (1961) for setting advertising
objectives and measuring the results.

Objectives:
Target Audience
Bench and Degree of change sought
Concrete, Measurable Tasks
Specified Time Period

DAGMAR model suggests that the ultimate objective of advertising must carry a
consumer through 4 levels of understanding:
Unawareness to awareness
The consumer must first be aware of a brand or company
Comprehension
He or she must have a comprehension of what the product is and its benefits.
Conviction
He or she must arrive at the mental disposition or conviction to buys the brand.
Action
Finally, he or she actually buy that product.

Advantages
Define advertising objectives and measuring the results.
Unawareness to awareness.
Easy to understand

e) Branding Strategies
The essence of developing a brand strategy is the foundation of communication that
builds authentic relationships between you and your audience

It is by defining the brand strategy that allows a person to utilize marketing, advertising,
public relations and social media to consistently and accurately reinforce the character.

The goal is to stimulate an engaging conversation that allows us to change perception,

diagnose expectations and bring clarity to the dialogue.

12 brand strategy principles believed to be the key to achieve business success.

1. Define your brand
It starts with your authenticity , the core purpose, vision, mission, position, values and
character. Focus on what you do best and then communicated your inimitable strengths
through consistency.
2. Your brand is your business model
Supports and challenge your business model to maximize the potential within your
brand.
3. Consistency, consistency, consistency
Consistency in the business is the key to differentiate.
4. Start from the Inside out
Everyone in the company can tell about what they see, think and feel about the brand.
Thats the story one should bring to the customers as well, drive impact beyond just the
walls of marketing.
5. Connect on the emotional level
A brand is not a name, logo, website, ad campaigns or PR, those are only the tools not
the brand. A brand is a desirable idea manifested in products, services, people, places and
experiences.
6. Empower brand champions
Award those that love your brand to help drive the message, facility activities so they can
be part of the process.
7. Stay relevant and flexible
A well managed brand is always making adjustments. Branding is a process, not a race,
not an event so expect to constantly tweak your message and refresh your image.
8. Align tactics with strategy
Convey the brand message on the most appropriate media platform with specific
campaign objectives.
9. Measure the effectiveness
Focus on the ROI (return on investment) is the key to measure the effectiveness of your
strategies.
10. Cultivate your community
Community is a powerful and effective platform on which to engage customers and
create loyalty towards the brand.
In an active community, members feel a need to connect with each other in the context of
the brands consumption.
11. Keep your enemies closer
Even if you have the most innovative, highly desirable product, you can expect new
competitors with a superior value proposition to enter your market down the road.
12. Practice brand strategy thinking
Its always easier to execute tactics than coming up with a strategy because it implies the
possibility of failure.