How price promotion can be applied without damaging

How price promotion can be applied without damaging brand equity Ding Ling Group 8

Outline o Introduction - Brand equity - Price promotion o Problem o Solution o Implication o Evaluation o List of references

Introduction o Brand equity Definition “Brand equity is a set of assets and liabilities linked to a brand's name and symbol that adds to (or subtracts from) the value provided by a product or service to a firm. ” Perceived quality Brand loyalty Brand equity Brand association Brand awareness Other brand’s private property Source: Aaker, 1991; Aaker, 2012

Introduction Price promotion Outline Nonmonetary promotion Perceived quality Brand equity Price promotion Brand association Source: Aaker (1991) Advertising campaigns

Thesis Statement o How price promotion can be applied without damaging brand equity by combining the non-monetary promotion and advertising campaigns.

Problem o The negative effect of frequent price promotion to perceived quality and brand association price promotion Non-monetary promotion Perceived quality Brand association Source: Buil, I. , de Chernatony, L. and Mart'inez, E. (2013). Examining the role of advertising and sales promotions in brand equity creation.

1 st Solution o Non-monetary promotion -- Definition (Yi and Yoo, 2011) Promotional strategy Hedonic benefits -- Different from price promotion

2 nd Solution o Advertising campaigns --Definition (Kotler, 2012) paid form of non-personal presentation promotion of ideas, goods and services --Different channels

Implication of Non-monetary promotion o Positive --customers may receive the high-quality perception --enhance brand equity Negative --enterprises could spend large budget on free gifts and free samples etc.

Implication of Advertising campaigns o positive --influence consumer behaviours in a large extent --deepen the impression of products or services o negative --further investment --less originality

Evaluation o the overall relationship between frequent price promotion and brand equity is negative o The most effective practice: nonmonetary promotions o The alternative possible solution: advertising campaigns

o As long as non-monetary promotion and advertising campaigns are implemented appropriately, price promotion can be applied along with the combination of two solutions without damaging brand equity

List of references o o o Aaker, D. (1991). Managing brand equity. 1 st ed. New York: Free Press. Buil, I. , de Chernatony, L. and Mart'inez, E. (2013). Examining the role of advertising and sales promotions in brand equity creation. Journal of Business Research, 66(1), pp. 115 --122. Keller, K. (2008). Strategic brand management: building, measuring, and managing brand equity. 3 rd ed. Kotler, P. , Keller, K. , Brady, M. , Goodman, M. and Hansen, T. (2012). Marketing management. 2 nd ed. Pearson Education. Villarejo-Ramos, A. and S'anchez-Franco, M. (2005). The impact of marketing communication and price promotion on brand equity. The Journal of Brand Management, 12(6), pp. 431 --444. Yi, Y. and Yoo, J. (2011). The long-term effects of sales promotions on brand attitude across monetary and non-monetary promotions. Psychology & Marketing, 28(9), pp. 879 --896

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