MANAGING BRAND EQUITY-2

Why is managing brand equity important over time?

Changing marketing environment (external

forces)
Shifts in consumer behaviour

Competitive strategies
Govt. regulations

Internal forces
Changes in strategic focus of the company.

STEPS FOR MANAGING BRANDS OVER TIME

a. Reinforcing brands
b. Revitalising brands
c. Adjusting brand portfolio

REINFORCING BRANDS

Reinforcing brands
Brand equity is reinforced by marketing actions that consistently
convey the MEANING of the brand to consumers in terms of
BRAND AWARENESS and BRAND IMAGE.
Reinforced marketing actions, along with product development,
branding strategies etc. also help in keeping the brand meaning in
terms of products, benefits and needs as well as in terms of
product differentiation intact.

Reinforcing depends on nature of the

brand associations
Product related performance associations
Product innovations are critical. Slide 72
Change in product may not be drastic, as brand meaning may be
associated with the product characteristics. Slide 73
Non-product related imagery associations
Relevance in user and usage imagery is critical. Slide 73
Potentially easier to change through major advertising campaigns
(no product innovation may be involved). Slide 74
Too frequent repositioning can blur the image of the brand and
confuse or even alienate the consumers.

Reinforcing of brands can be through

1. Maintaining brand consistency
2. Protecting sources of brand equity
3. Fortifying or Leveraging

4. Fine-tuning the marketing support program.

1. Maintaining brand consistency

Consistency of marketing support is essential
for maintaining strength and favorability of the
brand.
Shrinking R&D and communication budgets
may risk the brand becoming out-of-date,
irrelevant or even forgotten.
Consistency to be shown in brand
positioning.
Consistency doesnt mean no changes at all.

Tactics may change, but strategic positioning of

brand should not change.
Prices may go up or down, product features may
be added or deleted, brand extensions added or
withdrawn, ad campaigns may change .
Key elements of the marketing program and
brand meaning should be retained and
preserved

2. Protecting sources of brand equity

While looking at potentially powerful sources of brand equity, preserve
and defend the existing sources.
Unless there is some change with either consumers, competitors or the
company that makes the strategic positioning of the brand less powerful,
successful positioning should not be deviated from.
Key brand associations should not be altered.
E.g. Maggis new introductions.

3. Fortifying versus Leveraging

There is always a trade off between fortifying a brand and leveraging the
benefits of the brand to financial gains.
Fortifying means ways of increasing brand equity and furthering the brand
image through continuous marketing and advertising efforts.

On the other hand, capitalizing on existing brand equity to reap accruing

benefits in terms of cost savings (reduced communication expenditure) and
revenue opportunities (seeking increasingly higher premium and introducing
brand extensions.)

REVITALISING BRANDS

Increase quantity
of Consumption

Expand
depth/breadth of
awareness and
usage of Brand
Refresh old
sources of BE

Increase
frequency of
Consumption

BRAND
REVITALISING
STRATEGIS
Create new
sources of BE
Improve strength,
favorability, and
uniqueness of Brand
Associations

Bolster fading
associations

New
opportunities
New and different
ways of use

Retain vulnerable
Customers
Recapture lost
Customers

Neutralize
negative

Create new
associations

Identify neglected
segments

Attract new
Customers

Reverse Fortunes of Brands

Recapture lost sources of

Equity

Identify and establish new

sources of Brand Equity

Steps to Reverse Fortunes of

Brand
Revolutionaryor
Evolutionarychanges?
Revisit the basic values of
the brands
Determine current status of
sources of Brand Equity
Ascertain effectiveness of
key brand associations
Decisions on repositioning

Repositioning(RI)
Marketing Program (B2B)

Back 2 Basics
Continuum

Marketing Program
Failures
Insufficient Consumers
Less Damaging
Enforce positive
Associations

Reinvention

Positioning Failures
Sufficient but
dissatisfied Consumers
Extremely damaging
Difficult to overcome
negative associations

Approaches to Revitalisation
1. Expanding Brand Awareness

2. Improving Brand Image

3. Entering New Markets

1. Expanding Brand Awareness

Expand Breadth Increased
Usage
Quantity
Difficult to change
Function of particular beliefs
Exception Impulse
Consumption (availability)
Frequency
New opportunities
New Ways

1a. New usage Opportunities

Appropriateness &
Advantages of using
brands in new situations
Reminders to use brands
in those situations
Improving Top of the
mind awareness.
Functional Fixedness avoidance in non
traditional situations
Associated with special
occasions only.

1a. New usage opportunities contd

Retain premium brand
association
Consumer perception of usage
differs from the reality of
their usage.

Event
Replacement cycles

Performance
Consumers educated about
the merits of regular and
increased usage.

1b. Identifying new & completely

different ways to use the brand

New and different usage

application
Only new ad campaigns
not enough
New uses may arise from
new packaging
Egs Milkmaid, Amul
Cheese, McDonalds

Repositioning

2. Improving Brand Image

Changes in Brand
Awareness not sufficient
A new Marketing Program
Old positive associations
to bolstered
New positive associations
to be created
Negative associations to be
neutralized

Changing Brand Elements

Repositioning

Repositioning

Establishing more compelling

points of difference
Remind consumers of virtues of
brands that have been taken for
granted
Nostalgia and heritage
Establish a point of parity on key
image dimension
Negative product-related
associations due to changes in
consumer tastes

Changing brand elements

Modification of Brand
name
Other Brand Elements
Packaging, logos etc.
Moderate and
evolutionary in nature
Preserve salient aspects of
Brand elements
E.g.: Adidas, Federal
Express, GE

3. Entering New Markets

Reach out to new
Customer groups
Johnson and Johnson: Baby Soap,
Baby Shampoo

Reach out to decision

making segment instead of
the users
Women as decision makers
for mens products
Tapping the female
segment of the market

New market segments

based on cultural
dimensions
Retaining existing
Customers and Regaining
Lost Customers

ADJUSTMENTS TO BRAND
PORTFOLIO

Approaches adjustment to brand

portfolio
1. Migration Strategy

2. Acquiring new customers

3. Retiring Brands

1. Migration Strategy
Entry-Level Brands
Critical in bringing new
customers
Logical ordering
Hierarchical structure
in consumers mind.
E.g. BMW with 3,5,7
Series

2. Acquiring New Customers

To make up for loss of existing
customers
Important to attract younger
customers
Challenge Making Brand seem
relevant to customers
Each generation has a different
attitude from its preceding
generation
Strategies to encompass both
new and old customers

a. Multiple Marketing Program

Separate advertising
campaigns and
communication programs
for each segment
Blurring of images due to
media overlap

b. Brand Extensions and SubBranding

New technology, features

and attributes
Needs of new customers
or changing needs of
existing customers

c. New Distribution Outlets

Making products more

available

3. Retiring Brands
Options
1.
Marketing Support (Orphan
Brand)

2.

Reduce no. of product types

Almost no advertising and
promotional expenditure

Consolidation

3.

Stronger Brand HLL POWER

BRANDS
Cut Costs
Focus marketing Efforts

Discontinue product

Spin off Orphan Brands after a

cut off of low sales
Sell Orphan Brands
Fade away or discontinue
consciously. E.g. - Citra

Abandonment Decisions for

Retiring Brands
Markets prospects
Rate and type of decline
Segments of enduring demand
Reasons for decline

Competitive intensity
CA of Competitors
Willingness to exit
Brand Loyalty of Customers and Price pressures

Brand Strength

Strong Associations
Market share and position in the market
CA w.r.t. key Segments
Brands fit in the Strategic Thrust
Exit Barriers

MANAGING BRANDS OVER

GEOGRAPHIC BOUNDARIES
AND MARKET SEGMENTS

Rationale For Going Abroad

1. Slow growth and increased competition in
domestic markets
2. Overseas growth and profit
3. Economies of scale
4. Diversify risk
5. Global mobility of customers

Advantages Of Global Marketing

Economies of Scale
Lower Marketing Costs
Power and Scope
Consistency in Brand Image
Leverage good ideas quickly and efficiently
Uniform marketing practices

Disadvantages
Differences in consumer needs, wants and
usage patterns
Differences in consumer response to 4 Ps
Differences in brand and product
development and competitive environment
Differences in legal environment
Differences in marketing institutions
Differences in administrative procedures

Global Branding Decisions

1.
2.
3.
4.

Deciding which markets to enter

Deciding how to enter the market
Deciding on the marketing program
Deciding on marketing organisation

Selecting Global Markets

Economic Environment
Stage of development
Standard of living
Per capita income
Distribution of wealth
Currency stability
Exchange rates

Cultural Environment
Language
Lifestyle
Values
Norms and customs
Ethics
Taboos

International Marketing and Promotional Decisions

Demographic Environment
Size of population
Number of households
Household size
Age distribution
Occupation distribution
Education level
Employment rate
Income levels

Political/Legal Environment
Government policies
Laws and regulations
Political stability
Nationalism

Global Customer Based Brand Equity

Creating Brand Salience
Crafting Brand Image
Eliciting Brand Response
Cultivating resonance

Building Global Customer Based

Brand Equity
1.

Understand similarities and differences in the global

branding landscapes
2. No shortcuts
3. Establish Marketing Infrastructure
4. Integrated Marketing Communication
5. Brand Partnership
6. Balance Standardization & Customization
7. Local and global control
8. Establish operable guidelines
9. Global BEMS
10. Brand Elements

1. Understand similarities and differences in

the global branding landscapes
Developed &
Developing Markets
Landscape of Global
Brands

2. Sustained activity in Brand

Management
Continuous activities
Greater focus on R&D
Product Life Cycle
critical to brands
growth

3. Establish Marketing Infrastructure

Blend push and pull
strategies to build
brand equity
Infrastructure
constraints. Ex. Nestle
in China

4. Integrated Marketing Communication

Establish awareness
and key points of
parity. Ex. Kelloggs
Positioning same but
creative strategies may
differ. Ex. Dove
Easily available media
options: cable and
satellite; niche
magazines

5. Brand Partnership
Alternative ways of entry:
1.
2.
3.

Exporting existing brands

(geographic extension)
Acquiring brands (Brand
Acquisition)
Brand alliance

Trade off between key criteria:

speed, control and
investment.

Heinekens Sequential Strategy

Export to build brand
awareness
License to local brewer to
expand volume
Take equity stake or forge a
joint venture (piggyback sales
of high priced Heineken
brand with established local
brand)
Heinekens takeover of DB
Breweries in New Zealand
successful

6. Balance Standardization &

Customization
Standardization versus
Customization
- Globally standardized items:
advanced, functional, reliable
and low priced.
Ex.: McDonalds: Ronald McDonald
appears worldwide but the food and
marketing is localized.
Standardization and
Customization:

Standardized marketing:
LOreal: Because Im Worth It.

Customized marketing:

Tide in Russia positioned as economy

brand. (Little specific knowledge in
Russia)

Factors favoring standardization

1.
2.
3.
4.
5.
6.

7.

Common customer needs

Global customers and channels
Favorable trade policies and common regulations
Compatible technical standards
Transferable marketing skills
Essential criteria for development of global brand:
- positioning and branding applied globally
- technology which can be applied globally
- capabilities for local implementation
Key considerations in implementation
- market development and competitive environment at similar stages
in both countries
- consumer target markets should be alike

Supporting Marketing Programs Product

Only certain products
marketed similarly. Ex.
Pampers disposable diapers
Conduct research in local
markets
Product differences
sometimes not justified. Ex.
Palmolive soap
Sell both global and local
brands. Ex. Coke sells
Thums-Up in India

Price
Consumer perceptions of
value, willingness to pay,
elasticity to price change
Pressures for international
price alignment: Gray
imports
Price Corridor takes in
account differences in
countries and alignment
pressures

7. Local & Global Control

Decisions on
Centralization or
Decentralization
Nature of products and
its linkage to local
culture
Strategically easier to
define but difficult to
implement

8. Operable Guidelines
BRAND
MANAGEMENT
GUIDELINES

9. Global BEMS
Brand Asset Valuator

Interbrand Method

10. Brand Elements

Geographical
Transferability: Verbal
(name translation) vs.
Non-Verbal (logo,
color translation)
Ex.: Mars changed the
name of its third largest
UK brand Marathon to
Snickers which was
used in the rest of
Europe

Brand Equity Across Other Market

Segments

Regional Market
Segments

Ex. Campbell soups- Factors:

splintering of mass markets,
pockets of sales strengths,
focused targeting.

Other Demographic
And Cultural Segments
(Differences in attitudes
and behavior)

THANK YOU

COURSE RECAP
3 QUIZZES: 20
7 CASES: 20
1 MIDTERM: 30
1 END TERM: 30

INTRODUCTION
BRAND, BRANDING, BRAND
MANAGEMENT
TYPES OF BRANDS NAMES
HISTORICAL ORIGIN OF BRANDING
BRAND EQUITY
CUSTOMER BASED BRAND EQUITY

BUILDING BRAND EQUITY

CASES: LEVIS DOCKERS
INTEL
STARBUCKS

CUSTOMER BASED BRAND

EQUITY
BRAND KNOWLEDGE
DIFFERENTIAL EFFECT
CUSTOMER RESPONSE TO
MARKETING

BRAND KNOWLEDGE
BRAND AWARENESS
BRAND RECALL
BRAND RECOGNITION

BRAND IMAGE
STRENGTH
RELEVANCE
CONSISTENCY

FAVOURABILITY
DESIRABLE
DELIVERABLE

UNIQUENESS
POD
POP

DIFFERENTIAL EFFECT
PRIMARY BRAND ELEMENTS
BRAND ELEMENT CHOICE CRITERIA

MEMORABILITY
MEANINGFULNESS
TRANSFERABILITY
ADAPTABILITY
PROTECTABILITY

SECONDARY BRAND ASSOCIATION

MARKETING PROGRAM TO SUPPORT
ASSOCIATIONS

MEASURING BRAND
EQUITY
CASES: CMPB
B&J

BRAND VALUE CHAIN &

BEMS
MARKETING PROGRAM INVESTMENT
PROGRAM QUALITY (MULTIPLIER)

CUSTOMER MINDSET
MARKET PLACE CONDITION (MULTIPLIER)

MARKETING ENVIRONMENT
INVESTOR SENTIMENT (MULTIPLIER)

STAKEHOLDERS

METHODS TO MEASURE
PRICE
PRICE PREMIUM
PRICE PREMIUM AT EQUALISATION
PRICE PREMIUM AT INDIFFERENCE

COST

HISTORICAL COST
REPLACEMENT COST
DCF METHOD
BRAND CONTRIBUTION
INTERBRAND METHOD
MARKET VALUE METHOD

CUSTOMER
BRAND KNOWLEDGE
BLIND TEST
ATTRIBUTE BASED

MANAGING BRAND
EQUITY
CASES: NIVEA
NIKE

BRAND PRODUCT MATRIX

BRAND BREADTH STRATEGY
BRAND DEPTH STRATEGY

BRAND HIERARCHY

CORPORATE
FAMILY
INDIVIDUAL
MODIFIER

BRANDING STRATEGY
BRAND HIERARCHY
SUB-BRANDING & BRAND EXTENSIONS
DECISIONS
GRAY & SMELTZER BRAND PRODUCT
RELATIONSHIP
PRINCIPLES OF BRANDING

SIMPLICITY
RELEVANCE
PROMINENCE
DIFFERENTIATION
COMMONALITY

MANAGING BRANDS OVER

TIME

REINFORCING BRANDS

REVITALISING BRANDS

Maintaining brand consistency

Protecting sources of brand equity
Fortifying or Leveraging
Fine-tuning the marketing support program.
Expanding Brand Awareness
Improving Brand Image
Entering New Markets

ADJUSTING BRAND PORTFOLIO

Migration Strategy
Acquiring new customers
Retiring Brands

THANK YOU

BACK Slide 6

BACK Slide 6

BACK Slide 6

BACK Slide 6

HLL POWER BRANDS

Surf

Clinic

Modern

Rin

Sunsilk

Knorr

Wheel

Nihar

Kwality Walls

Vim

Fair & Lovely

Brooke Bond

Lux

Ponds

Taj Mahal

Pears

Lakme

A1

Breeze

Pepsodent

3 Roses

Lifebuoy

Closeup

Lipton Taaza

Liril

Kissan

Bru

Rexona

Annapurna

Dalda
BACK Retiring Brands