Branding Packaging and Labeling Chapter 31 Branding Brand
Branding, Packaging, and Labeling Chapter 31
Branding Brand – a name, term, design, or symbol that identifies a business/organization, its products, and distinguishes it from competitors Ø Used for one product, a family of related products, or all products of a company Ø Used to identify quality and reliability Ø One of company’s most important assets Ø Includes brand name, brand mark, trade name, trademark, trade characters, etc. Ø Frequently become global brands which appeal to consumers beyond cultural, political, geographic boundaries Ø
Elements of Branding Brand name (product brand) – a word, group of words, letters, or numbers representing a product or service l Usually spoken l Ex: PT Cruiser, Pepsi, Barbie, Big Mac l Should be easily pronounced, distinctive, and recognizable Ø Trade name (corporate brand) – identifies the company or a division of a corporation l Legal name that a company uses in business l Supports other brands owned by the company l Ex: Kellogg’s, Proctor & Gamble, Disney, Nike Ø
Elements of Branding Brand mark – a unique symbol, coloring, lettering, or other design element l Recognized visually, usually not spoken l Ex: Apple Computer’s apple or US Postal Service’s eagle Ø Trade character – type of brand mark with human form or characteristics l Ex: Jolly Green Giant, Tony the Tiger, Pillsbury Doughboy, Keebler Elves, etc. Ø Trademark – word, name, symbol, sound, device, or combination that has been given legal protection by the federal government; Has the ® next to it Ø Prevents other companies from using a similar element l Ex: Mc. Donald’s golden arches; NBC peacock l Granted by the US Patent and Trademark Office Ø
Importance of Branding in Product Planning Establishes an image for a product/company Ø Builds product recognition and customer loyalty Ø Ensures quality and consistency l Ex: 90% of people will pay 25% more for a GE light bulb rather than the competing brand Ø Identifies the company that manufactures the product Ø Capitalizes on brand exposure l Helps reach new target markets and extending product lines Ø
Generating Brand Names 75% of all companies introduce a new product name every year Ø Some ways to create a brand name l Computer software (checks to see if already owned) l Often generated internally by employees l Branding agencies l Over 60% of all companies do research to test new brand names before released • Brand loyalty research helps gauge effectiveness Ø
Types of Brands National brands (producer brands) – owned by national manufacturers or by companies that provide services l Generate majority of sales for most consumer product categories (70% food, 65% appliances, 80% gas, 100% automobiles) l Hershey Foods, Colgate-Palmolive, Whirlpool, Hilton, Avis Ø Private distributor brands (private brands, store brands, dealer brands, private labels) – developed and owned by wholesalers and retailers; help cultivate customer loyalty, profitable l Manufacturers name does not appear on the product l Quality and performance of national brands at lower prices l Ex: Wal-Mart’s George brand l Represents 80% of apparel sales at Target Ø Generic brands – do not carry a company identity l Packaging – description of the contents “pancake mix” l Sold in discount stores & some supermarkets Ø
Branding Strategies Brand Extension - Use the existing brand name for a new/improved product in product line l Ex: Ocean Spray added Cran. Apple, Cherry, Grape l May cause brand dilution (too many products) – brand loses strength l Costly, failure rate is high for new products Ø Brand Licensing - Legal authorization to allow another company to use its brand, brand mark, etc. l Licensing company receives a fee such as a royalty in return for authorization l Ex: NFL licenses to Visa and Pepsi Ø
Branding Strategies Mixed Brands – offer a combination of manufacturer, national, generic brands l Maintain loyalty through national brand private brands, reach several target markets l Maximize profitability by selling a private brand product without damaging national brand reputation l Ex: Michelin makes own brand private label for Sears Ø Co-Branding - Combines one or more brands in the manufacturing of a product or delivery of a service l Increase customer loyalty and sales for each brand l Ex: Pop Tarts has Smucker’s fruit filling; Starbuck’s coffee sold at Barnes & Noble, Target, Kroger Ø
Packaging Package – the physical container or wrapping for a product Ø 10% of a product’s retail price is spent on developing, designing, and producing just the package Ø
Functions of Packaging Ø Ø Ø Promote and sell the product – visually appealing l Customer reaction to a product’s package & brand name is an important factor in its success or failure in the marketplace l Mixed bundling - package complementary products together l Price bundling – two or more similar products packaged for one price Define product identity – prestige, convenience, status Provide information – directions, contents, guarantees, nutrition Meet customer needs – various sizes Ensure safe use – improve product safety l Blisterpacks – preformed plastic molds surrounding individual items arranged on a backing; avoids tampering Protect the product – protect during shipping, storage, and display, breakage, spoilage, shoplifting, etc.
Packaging Issues Aseptic Packaging l Uses a technology that keeps foods fresh without refrigeration for extended periods • Sterilizes the package and food, sealed in a sterile environment Ø Environmental Packaging l Customers willing to pay more for products that reduce waste; recyclable, safer for the environment Ø Cause Packaging l Promote social and political issues l Campbell’s soup and Yoplait yogurt – breast cancer Ø
Labeling Ø Ø Ø Label l an information tag, wrapper, seal or imprinted message that is attached to a product or its package Informs customers about a product’s contents and gives directions for use Helps customers decide if the product is right for them Protects businesses from legal liability for mishaps Types of Labels l Brand – supplies logo, does not provide much info l Descriptive – info about the product’s use, care, performance, expiration dates, warnings, etc. l Grade – states quality of the product (eggs, produce)
Labeling Laws Ø Ø Ø Fair Packaging and Labeling Act (1966) – mandatory labeling requirements and authorized the US FDA and the FTC to require packaging regulations l Product weight (metric and American) Nutrition Labeling and Education Act (1990) by FDA l protects consumers from deceptive labeling l requires nutrition info (fat, calories, etc. ), health warnings, genetically modified food info Federal Trade Commission (FTC) – monitors deceptive advertising, care labels, recycling info Care Labeling Rule (1972) – care labels must be placed in textile clothing US Department of Agriculture – monitors agricultural market, including organic foods l Country of Origin Labeling (2002) – label must be placed on all produce, nuts, meats, fish
Activity ØSelect a branded food product and identify how the package for the product fulfills one or more of the functions of packaging. ØRedesign the product packaging and labeling for the product ØEx: Kraft Miracle Whip l New bottle meets customers needs b/c it has extra large opening, plastic l The label has larger font and uses bright red font color.
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