BRAND RESONANCE AS A STRATEGIC MARKETING TOOL Professor

BRAND RESONANCE AS A STRATEGIC MARKETING TOOL Professor Kevin Lane Keller Tuck School of Business Dartmouth College

Agenda n n Understanding Brand Resonance Managing the Four Components of Brand Resonance n n n Key concepts Case studies Summary & Discussion 2

Definition of Customer-Based Brand Equity n The differential effect that brand knowledge has on customer response to brand marketing activity n n Sources: Thoughts, feelings, images, experiences, beliefs, attitudes, experiences, etc. Outcomes: Revenue enhancements & cost savings 3

Brand Resonance n n The marketing challenge is to ensure consumers have the right types of experiences to create the right brand knowledge Brand resonance is when consumers feel that they are “in synch” with a brand Creating brand resonance involves a series of steps as part of a “branding ladder” Creating brand resonance is also characterized by a logically constructed set of brand “building blocks. ”

BRAND RESONANCE PYRAMID Stages of Brand Development 4 RELATIONSHIPS: What about you & me? 3 RESPONSE: What about you? 2 MEANING: What are you? Building Blocks Feelings 1 Positive, Accessible Reactions Points-of-Parity & Difference Performance IDENTITY: Who are you? Intense, Active Loyalty Resonance Judgments Branding Objective at Each Stage Salience Imagery Deep, Broad Brand Awareness

Brand Resonance Building Blocks: Salience n Depth and breadth of brand awareness n n Recognition and recall at purchase and consumption How easily and often the brand is thought of n In all the right places … at all the right times … in all the right ways

Brand Resonance Building Blocks: Performance & Imagery n Performance n What the brand does to meet customers' more functional needs. n n Brand performance refers to the intrinsic properties of the brand in terms of inherent product benefits. Imagery n How people think about a brand abstractly rather than what they think the brand actually physically does. n n Brand imagery is thus more extrinsic properties of the brand. Four important intangible dimensions are: n n Type of user Brand personality History & heritage Experiences

Superior Competitive Positioning n n Performance and Imagery associations should be chosen to help the brand achieve a superior competitive positioning Develop 3 -5 unique brand points-of-difference (POD’s) n n Desirable to consumer Deliverable by the company Differentiatied from competitors Establish 2 -4 shared brand points-of-parity (POP’s) n n n Negate competitor points-of-difference Overcome perceived vulnerabilities from points-of-difference Demonstrate category credentials Kevin Lane Keller, Brian Sternthal, and Alice Tybout (2002), “Three Questions You Need to Ask About Your Brand, ” Harvard Business Review , September, 80 (9), 80 -89. 8

Brand Resonance Building Blocks: Judgments & Feelings n Judgments n Consumers overall brand evaluations n n n How consumers combine performance and imagery associations to form different kinds of brand opinions Quality, satisfaction, credibility, consideration, superiority Feelings n Consumers emotional responses and reactions to the brand n n Can be mild or intense; positive or negative; or experiential or enduring in nature. Can also relate to the social currency evoked by the brand.

Dimensions of Brand Feelings Brand feelings can be divided into two broad categories: § Experiential – immediate, short-lived during purchase/consumption § Enduring – private, possibly part of day-to-day life Brands should have one, or ideally both, types of feelings Increasing level of intensity Experiential Feelings Enduring Feelings • Warm • Sense of Security (Inner-directed) • Fun • Social Approval (Outer-directed) • Exciting • Self-Respect (Actualization) Self-Respect Sense of Security Social Approval Inner-Directed Outer-Directed Higher level of values & needs

Brand Resonance Building Blocks: Resonance n The extent to which customers feel that they are “in synch” with the brand n n Intensity or depth of the psychological bond that customers have with the brand or others Level of activity engendered by this loyalty n n Repeat purchase rates The extent to which consumers seek out brand information, events, or other loyal customers

The Four Components of Brand Resonance n Behavioral Loyalty n n Attitudinal Attachment n n When customers view the brand as being something special in a broader context Active Engagement n n Customers’ repeat purchases and the amount or share of category volume attributed to the brand When customers are willing to invest personal resources on the brand – time, energy, money, etc. – beyond those resources expended during purchase or consumption of the brand Sense of Community n When customers feel a kinship or affiliation with other people associated with the brand.

BRAND RESONANCE PYRAMID Stages of Brand Development 4 RELATIONSHIPS: What about you & me? 3 RESPONSE: What about you? 2 MEANING: What are you? Building Blocks Feelings 1 Positive, Accessible Reactions Points-of-Parity & Difference Performance IDENTITY: Who are you? Intense, Active Loyalty Resonance Judgments Branding Objective at Each Stage Salience Imagery Deep, Broad Brand Awareness

Sub-Dimensions of Brand Resonance Pyramid RESONANCE LOYALTY ATTACHMENT COMMUNITY ENGAGEMENT JUDGMENTS QUALITY CREDIBILITY CONSIDERATION SUPERIORITY PERFORMANCE PRIMARY CHARACTERISTICS & SECONDARY FEATURES PRODUCT RELIABILITY, DURABILITY & SERVICEABILITY SERVICE EFFECTIVENESS, EFFICIENCY, & EMPATHY STYLE AND DESIGN PRICE FEELINGS WARMTH FUN EXCITEMENT SECURITY SOCIAL APPROVAL SELF-RESPECT IMAGERY USER PROFILES PURCHASE & USAGE SITUATIONS PERSONALITY & VALUES HISTORY, HERITAGE, & EXPERIENCES SALIENCE CATEGORY IDENTIFICATION NEEDS SATISFIED

Nike Brand Resonance Pyramid Attachment Community Engagement Rational Route Credibility Superiority Innovative Quality Stylish Fun Exciting Self-respect Empowerment Irreverence Salience – Everything Athletic Emotional Route

Starbucks Brand Resonance Pyramid Loyalty Attachment Community Engagement Rational Route Quality Credibility Consideration Superiority Quality ingredients Exotic variety Personalized service Comfortable atmosphere Warm Fun Relaxation Romantic indulgence Emotional Route Sophisticated & elegant Casual & comfortable “Third Place” Progressive & cool Salience – Highly accessible & convenient (ideally anywhere & anytime)

Brand Resonance Components n Behavioral loyalty – Customers’ repeat purchases and the amount or share of category volume attributed to the brand n n How often do customers purchase a brand? How much do they purchase? 17

Brand Resonance Components n Attitudinal attachment – When customers view the brand as being something special in a broader context n n n Do customers “love” the brand? Do they describe it as one of their favorite possessions? Do they view it as a “little pleasure” they look forward to? 18

Brand Resonance Components n Sense of community – When customers feel a kinship or affiliation with other people associated with the brand. n n Do customers interact with fellow brand users or employees or representatives of the company? Does this occur on-line and/or off-line? 19

Brand Resonance Components n Active engagement – When customers are willing to invest personal resources on the brand – time, energy, money, etc. – beyond those resources expended during purchase or consumption of the brand n n n Do customers choose to join a club centered on a brand? Do customers receive updates, exchange correspondence with other brand users or formal or informal representatives of the brand itself? Do they visit brand-related Web sites, participate in chat rooms, and so on? 20

Brand Resonance Network Company – Brand connections Consumer – Company connections Brand Consumer – Brand connections Consumer – Consumer connections

Any marketing activity can be judged by its total effect on the four dimensions of brand resonance Behavioral Loyalty Attitudinal Attachment Sense of Community Active Engagement

Achieving Resonance n First, must create foundation for resonance n n Proper salience & breadth & depth of awareness Firmly established points-of-parity & points-ofdifference Positive judgments & feelings that appeal to the head & the heart Then, must optimize four dimensions of brand resonance 23

1. Building Behavioral Loyalty n n Break down barriers at purchase & consumption Broaden customer access point n n Find appropriate new distribution outlets Elicit additional & new consumption opportunities 24

Starbucks Growth Strategy n Product development n Coffee driven n n Complements n n Bottled Frappuccino, Double. Shot, Ice Cream Starbucks Card Duetto Visa, Hear Music Choice Artist CD series, healthy breakfast items, smoothies Market development n New outlets n n Hotels, airports, airlines, book stores, department stores, corporations, etc. New markets n Almost 5, 000 coffeehouses in 93 markets outside North America (with carefully chosen partners)

2. Building Brand Attachment n Stake out emotional territory n Experiential n n Enduring n n Warm, fun or exciting Sense of security, social approval, or self-respect Celebrate uniqueness & make indispensable n n Relevance Immediacy 26

Pampers n Pampers evolved from a functional to an emotional positioning: n n n Absorbency & dry baby “Caring for Baby’s Development” Pampers changed marketing program accordingly n n Advertising etc. Web site

3. Building Brand Community n Allow, facilitate, and encourage interaction online & offline with others n n n Learn from and teach others Express and observe loyalty Give them something to talk about n n n Product or brand news Social events Marketing activities 28

Dove “Real Beauty” n n n Dove had been backed for decades by traditional advertising touting the brand’s benefit of one-quarter moisturizing cream and exhorting women to take the seven-day Dove test. A significant shift in strategy occurred for Dove in 2003 with the launch of the Real Beauty campaign, which celebrates “real women” of all shapes, sizes, ages, and colors. The multi-media campaign was thoroughly integrated. n n n Traditional TV and print ads were combined with all forms of new media, such as real -time voting for models on cell phones and tabulated displays of results on giant billboards. PR was dialed up; paid media was dialed down. The Internet was crucial for creating a dialogue with women. A website was launched and supplemented with ad videos (“Evolution” & “No Age Limit”). 29

Consumer-to-Consumer Equity Transfer Promotions Sponsorships Experiences Events Information Consumer 1 Emotions Blogs Web sites Online ads & videos Consumer 2 Bulletin boards 30

Building Brand Engagement n n Must have people read about, talk about, think about, and engage in activities with the brand Create opportunities for brand involvement 31

Jeep Jamborees & Camps n n n In addition to the hundreds of local Jeep enthusiast clubs throughout the world, Jeep owners can convene with their vehicles in wilderness areas across America as part of the company’s official Jeep Jamborees and Camp Jeep. Since the inaugural Camp Jeep in 1995, over 28, 000 people have attended the three-day sessions, where they practice off -road driving skills and meet other Jeep owners. Jeep Jamborees bring Jeep owners and their families together for two-day offroad adventures in more than 30 different locations from Spring through Autumn each year. 32

Marketing & Resonance n Any marketing activity can affect more than one dimension of resonance n n Certain categories allow for more resonance n n Interactive or multiple effects Inherently high levels of interest & activities To maximize brand resonance, increase the levels of both the intensity & activity of customer loyalty relationships 33

The Duality of Brand Resonance Intensity of Relationship Heirloom Brands Beloved Brands Heritage Brands Necessity Brands Utilitarian Brands Brand Resonance Requires Customer Intensity & Activity of Relationship

Summary n n Brand resonance can provide a useful means to maximize brand equity & customer equity Brand resonance is created by developing marketing activities that: n n Overcomes physical & mental barriers for purchase & consumption Strikes an emotional chord Is a catalyst for social connections Creates meaningful opportunities for interactions 35

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