CHAPTER 10 Crafting the Brand Positioning Copyright 2016
CHAPTER 10 Crafting the Brand Positioning Copyright © 2016 Pearson Education Ltd. 10 -
DEVELOPING A BRAND POSITIONING • Positioning – The act of designing a company’s offering and image to occupy a distinctive place in the minds of the target market Copyright © 2016 Pearson Education Ltd. 10 -2
DEVELOPING A BRAND POSITIONING • Answer…why the target market should buy a product or service. • A value proposition captures the way a product or service’s key benefits provide value to customers by satisfying their needs. Copyright © 2016 Pearson Education Ltd. 10 -3
VALUE PROPOSITION Copyright © 2016 Pearson Education Ltd. 10 -4
COMPÉTITIVE FRAME OF REFERENCE Identifying and analyzing competitors Copyright © 2016 Pearson Education Ltd. 10 -5
COMPETITIVE FRAME OF REFERENCE • SWOT analysis of competitors • What is each competitor seeking in the marketplace? What drives each competitor’s behavior? Copyright © 2016 Pearson Education Ltd. 10 -6
POINTS-OF-DIFFERENCE AND POINTS-OF-PARITY • Points-of-difference (PODs) – Attributes/benefits that consumers strongly associate with a brand, positively evaluate, and believe they could not find to the same extent with a competitive brand. Copyright © 2016 Pearson Education Ltd. 10 -7
• POD criteria Desirable Deliverable Differentiating Copyright © 2016 Pearson Education Ltd. 10 -8
POINTS-OF-DIFFERENCE AND POINTS-OF-PARITY • Desirable to consumer. Consumers must see the brand association as personally relevant to them. • Deliverable by the company. The product design and marketing offering must support the desired association. • Differentiating from competitors. Finally, consumers must see the brand as distinctive and superior to relevant competitors. Copyright © 2016 Pearson Education Ltd. 10 -9
POINTS-OF-DIFFERENCE AND POINTS-OF-PARITY • Points-of-parity (POPs) – Attribute/benefit associations that are not necessarily unique to the brand but may in fact be shared with other brands. Copyright © 2016 Pearson Education Ltd. 10 -10
POINTS-OF-DIFFERENCE AND POINTS-OF-PARITY • As BMW and Mercedes-Benz compete in the same premium cars market, they have the same competitive frame of references. • That being said, in order to differentiate, they had to define a brand positioning strategy by identifying the Points of Parity (POPs) and the Points of Difference (PODs). Copyright © 2016 Pearson Education Ltd. 10 -11
POINTS-OF-DIFFERENCE AND POINTS-OF-PARITY • POP forms Category Correlational Competitive Copyright © 2016 Pearson Education Ltd. 10 -12
POINTS-OF-DIFFERENCE AND POINTS-OF-PARITY • POP associations come in three basic forms: category, correlational, and competitive. • Category points-of-parity are attributes or benefits. In other words, they represent necessary—but not sufficient— conditions for brand choice. • Correlational points-of-parity are potentially negative associations that arise from the existence of positive associations for the brand. • Competitive points-of-parity are associations designed to overcome perceived weaknesses of the brand in light of competitors’ points-ofdifference. Copyright © 2016 Pearson Education Ltd. 10 -13
SUSTAINABLE COMPETITIVE ADVANTAGE Competitive advantage is a company’s ability to perform in one or more ways that competitors cannot or will not match. Copyright © 2016 Pearson Education Ltd. 10 -14
SUSTAINABLE COMPETITIVE ADVANTAGE • In general, a company that hopes to endure must be in the business of continuously inventing new advantages that can serve as the basis of points-ofdifference. Copyright © 2016 Pearson Education Ltd. 10 -15
POINTS-OF-DIFFERENCE AND POINTS-OF-PARITY • Brand mantras Communicate Simplify Inspire Copyright © 2016 Pearson Education Ltd. 10 -16
BRAND MANTRAS • A brand mantra is a three- to five-word articulation of the heart and soul of the brand is closely related to other branding concepts like “brand essence” and “core brand promise. ” three key criteria for a brand mantra: • Communicate. A good brand mantra should clarify what is unique about the brand. Copyright © 2016 Pearson Education Ltd. 10 -17
BRAND MANTRAS • Simplify- An effective brand mantra should be memorable. • Inspire- Ideally, the brand mantra should also stake out ground that is personally meaningful and relevant to as many employees as possible. Copyright © 2016 Pearson Education Ltd. 10 -18
MONITORING COMPETITION • Variables in assessing potential competitors – Share of market – Share of mind – Share of heart Copyright © 2016 Pearson Education Ltd. 10 -19
MONITORING COMPETITION In assessing potential threats from competitors, three high-level variables are useful: 1. Share of market —The competitor’s share of the target market. 2. Share of mind —The percentage of customers who named the competitor in responding to the statement “Name the first company that comes to mind in this industry. ” 3. Share of heart —The percentage of customers who named the competitor in responding to the statement “Name the company from which you would prefer to buy the product. ” Copyright © 2016 Pearson Education Ltd. 10 -20
"BUZZ" MARKETING • This “buzz” marketing is highly effective for spreading the word about a new product or service. • Buzz marketing is a viral marketing technique that is focused on maximizing the word-ofmouth potential of a particular campaign or product, Copyright © 2016 Pearson Education Ltd. 10 -21
CHAPTER 11 Creating Brand Equity Copyright © 2016 Pearson Education Ltd. 10 -
LEARNING OBJECTIVES 1. What is a brand, and how does branding work? 2. What is brand equity? 3. How is brand equity built? 4. How is brand equity measured? 5. How is brand equity managed? 6. What is brand architecture? 7. What is customer equity? Copyright © 2016 Pearson Education Ltd. 10 -23
HOW DOES BRANDING WORK? • American Marketing Association – A brand is “a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors” Copyright © 2016 Pearson Education Ltd. 10 -24
HOW DOES BRANDING WORK? • A brand is thus a product or service whose dimensions differentiate it in some way from other products or services designed to satisfy the same need. • These differences may be functional, rational, or tangible—related to product performance of the brand. • They may also be more symbolic, emotional, or intangible— related to what the brand represents or means in a more abstract sense. Copyright © 2016 Pearson Education Ltd. 10 -25
THE ROLE OF BRANDS • Brands’ role for consumers ü Set and fulfill expectations ü Reduce risk ü Simplify decision making ü Take on personal meaning ü Become part of identity Copyright © 2016 Pearson Education Ltd. 10 -26
THE ROLE OF BRANDS • Brands’ role for firms ü Simplify product handling üOffer legal protection ü Create brand loyalty ü Secure competitive advantage Copyright © 2016 Pearson Education Ltd. 10 -27
THE SCOPE OF BRANDING • Branding – The process of endowing products and services with the power of a brand. Copyright © 2016 Pearson Education Ltd. 10 -28
THE SCOPE OF BRANDING • It’s all about creating differences between products. • Marketers need to teach consumers “who” the product is—by giving it a name and other brand elements to identify it—as well as what the product does and why consumers should care. • Branding creates mental structures that help consumers organize their knowledge about products and services in a way that clarifies their decision making and, in the process, provides value to the firm. Copyright © 2016 Pearson Education Ltd. 10 -29
DEFINING BRAND EQUITY • Brand equity – Added value endowed to products with consumers. – Brand equity may be reflected in the way consumers think, feel, and act with respect to the brand, as well as in the prices, market share, and profitability it command. Copyright © 2016 Pearson Education Ltd. 10 -30
DEFINING BRAND EQUITY • Customer-based brand equity – when consumers react more favorably to a product – A brand has negative customer-based brand equity if consumers react less favorably to marketing activity for the brand under the same circumstances. Copyright © 2016 Pearson Education Ltd. 10 -31
DEFINING BRAND EQUITY • Brand promise – The marketer’s vision of what the brand must be and do for consumers. Copyright © 2016 Pearson Education Ltd. 10 -32
BRAND EQUITY MODELS Brand. Asset® Valuator Copyright © 2016 Pearson Education Ltd. 10 -33
BRAND EQUITY MODELS • Brand. Asset® Valuator – Energized differentiation – Relevance – Esteem – Knowledge Copyright © 2016 Pearson Education Ltd. 10 -34
BRAND EQUITY MODELS • There are four key components—or pillars—of brand equity, according to BAV (see Figure 11. 1). • Energized differentiation measures the degree to which a brand is seen as different from others as well as its pricing power. • Relevance measures the appropriateness and breadth of a brand’s appeal. Copyright © 2016 Pearson Education Ltd. 10 -35
BRAND EQUITY MODELS • Esteem measures how well the brand is regarded and respected. • Knowledge measures how aware and familiar consumers are with the brand • Energized differentiation and relevance combine to determine brand strength Copyright © 2016 Pearson Education Ltd. 10 -36
BUILDING BRAND EQUITY • Brand element choice criteria Memorable Meaningful Likable Protectable Adaptable Transferable Copyright © 2016 Pearson Education Ltd. 10 -37
INTERNAL BRANDING • Activities and processes that help inform/inspire employees about brands Choose the right moment Link internal & external marketing Bring the brand alive for employees Keep it simple Copyright © 2016 Pearson Education Ltd. 10 -38
INTERNAL BRANDING • When employees care about and believe in the brand, they’re motivated to work harder and feel greater loyalty to the firm. Some important principles for internal branding are: • Choose the right moment. Turning points are ideal opportunities to capture employees’ attention and imagination. • Link internal and external marketing. Internal and external messages must match. • Bring the brand alive for employees. Internal communications should be informative and energizing. • Keep it simple. Don’t overwhelm employees with too many details. Focus on the key brand pillars, ideally in the form of a brand mantra. Copyright © 2016 Pearson Education Ltd. 10 -39
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