1. Lecture 1 – WHAT IS A BRAND?

2. A history of branding
Cattle branding
Greek
Civilization
Pottery
Roman
Civilization
Products
Flags & Standards
Medieval
Sales
Porcelain
Appearance of to-be
global brands
17th Century
Product marketing
Industrial
Revolution
WWW
Media proliferation
Transportation
20th Century
Corporate branding

3. What is brand equity?
• A set of assets (and liabilities) linked to a brand’s
name and symbol
– The value that a brand adds to a product or service
– Much like the concept of goodwill
• Future expectations; money
Aaker chap. 1

4. Value of a Brand
Rowntree (KitKat, After Eight & Polo Mint)
• Nestlé paid 45 bill.; 5x asset value
Kraft General Foods
• Philip Morris paid 129 bill; 4x asset value

5. Strong Brands
- Something striking??

6. Asset factors - building a brand strong
1. Commitment to quality – perceived (delivered)
quality = fastest route to consumer satisfaction
2. Awareness – promotions, ads, logo (increase
customer familiarity)
3. Fostering loyalty – even in troubled times
4. Strong and clear brand identity build upon
associations
Aaker chap. 1

7. 1. Perceived quality
• The only brand association which can drive
financial performance
– Influences total perception of the brand
• Price ↔ Quality position
– Quality is a key strategic factor for most
companies (TQM)
• Often found in mission statements
• But then what is quality??
Aaker chap. 1

8. 2. Brand awareness
• The strength of the brand’s presence in the
consumer’s mind
• Measured according to ways in which consumers
remember the brand
– recognition
– re-call
– recognition v recall?
– the ultimate awareness level = brand name
dominance
Aaker chap. 1

9. 3. Brand loyalty
• Brand value is largely created by customer
loyalty
– A brand without loyalty is vulnerable
• Loyalty has great impact on marketing costs
Aaker chap. 1

10. 4. Brand associations
• Brand equity strongly supported by
associations made by consumers
– Associations might include product attributes,
celebrity spokesperson or particular symbol
• Brand associations driven by brand identity
THUS, a key to building strong brands is to
develop and implement a brand identity
Aaker chap. 1

11. Building strong brands is doable!
Key is to:
• develop brand identity
– know what the brand stands for
• express the identity – effectively and consistently
• manage internal forces
Aaker chap. 1

12. Brand Identity
Brand identity is the driver of one of the four principal dimensions of brand equity
• Brand associations.
Brand identity:
• A unique set of brand associations that the brand
strategist aspires to create or maintain.
–
what the brand stands for and imply a promise to customers from the organisation members.
Aaker chap. 3

13. Brand Identity Traps
Limits the identity leading to ineffective and often
dysfunctional brand strategies.
1. The brand image trap
Customer > Company
2. Brand Positioning Trap
Part of Identity but not instead of
3. External perspective Trap
Identity < Why customers buy
4. Product-Attribute Fixation Trap
Most common trap
Limitations:
» Fail to differentiate
» Are easy to copy
» Assume a rational customer
» Limit brand extension strategies
» Reduce strategic flexibility
-
Relevance
+
Aaker chap. 3

14. Brand image trap
• Brand image trap: lack of efforts to go beyond
the brand image
• Brand image becomes brand identity
• Solution: provide useful and necessary
background information when developing
brand identity to improve the customer
perception
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15. Brand image vs Brand identity
Brand image
Brand identity
Is passive and looks to the past
Should be active and look to the future,
reflecting associations aspired for brand
Tends to be tactical
Should be strategic, should reflect the
business strategy to lead to sustainable
advantage
Might not be silent
Should reflect brand brand’s enduring
qualities
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16. Brand position trap
• Part of brand identity and value proposition
that is to be communicated and demonstrates
an advantage over competitive brands
• The trap occurs when the search for a brand
identity becomes a search for a brand position
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17. The external perspective trap
• The company fails to realize the role that
brand identity plays in helping the
organization understanding its basic value and
purpose
Eg: it is hard to expect the employees to make a
vision happen if they do not understand and
buy into the same vision of the company
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18. Product-attribute fixation trap
• Trap- the strategic and tactic management of the brand is
focusing only on the product attributes Wrong
• attributes are not the only relevant basis for customer
decision and competitive dynamics
A brand is more than a product
• Product attributes as the basis for brand identity have
important limitations: Fail to differentiate
Easy to copy
Assume a rational consumer
Reduce the strategic flexibility
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19. Avoiding the traps
•
To help ensure that the brand has texture and depth (and are
not caught in the identity traps), the firm should consider its
brand as:
–
–
–
–
a product
an organisation
a person
a symbol
ALL BRANDS ARE A PRODUCT
BUT
NOT ALL PRODUCTS ARE A BRAND!
Aaker chap. 3

20. The brand as a product
- Product related associations
Product related associations will almost always be an
important part of brand identity
•
Linked to brand choice decisions and use experience
The brand-as-product
•
•
•
•
•
•
Product scope
Product attributes
Quality/value
Uses
Users
Country of origin
Aaker chap. 3

21. The Brand as organisation
This perspective focuses on attributes of the
organisation rather than those of the product or service.
• Organisational attributes are more enduring and more
resistant to competitive claims than product attributes.
Organisational attributes can contribute to a value
proposition.
The brand-as-organisation
• Organisational attributes
• Local versus global
Aaker chap. 3

22. The brand as person
• This perspective suggests a richer and more interesting brand
identity than one based on product attributes.
• It can help create a self-expressive benefit.
• Brand personality can be the basis of a relationship
between the customer and the brand
The brand-as-person
• Brand personality
• Brand-customer relationships
Aaker chap. 3

23. The brand as symbol
A strong symbol can provide cohesion and structure to
an identity and make it much easier to gain recognition
and recall.
A strong symbol can be the cornerstone of a brand
strategy. Sometimes it can also represent the essence
of the brand.
The brand-as-symbol
• Visual
imagery/metaphors
• Brand heritage
Aaker chap. 3

24. The identity structure
Consists of core identity and extended identity
Core identity - The central, timeless essence of the brand
•
Contains the associations that are most likely to remain constant as the
brand travels to new markets and products.
•
•
Mc Donald’s: value offering, quality, service, cleanliness, user
Nike: product trust, user, performance, enhancing lives
Aaker chap. 3

25. The identity structure
Extended identity
•
Includes brand identity elements, organised into cohesive and meaningful
groupings that provide texture and completeness (the mental network,
figure 3.9).
– E.g. brand personality is often part of the extended identity.
– Mc’ Donalds sub brands(Mc Cofee), logo , characters , convenience
– Nike personality, logo, sub brands, slogans(?) endorsers
Aaker chap. 3

26. Working with multiple brand identities
• In some cases a brand identity is so persuasive
and universal that it will work in all markets
(Coca Cola)
– In most cases a brand identity will need to be adapted to different market or product
contexts
• When multiple identities are needed, the goal
is to have a common set of associations, some
of which will be the core identity. Different
elements can be emphasised in each market.
Aaker chap. 3

27. Formulating a value proposition
There are 3 elements to consider in the statement:
• Functional benefits
Product attributes
• Emotional benefits
Gives the customer a positive feeling
?
• Self-expressive benefits
communicate his or her
Gives the customer a way to
own self-image
The role of price is ALWAYS important.

28. Providing a value proposition
The brand identity needs to provide a
value proposition to the customer.
•
Leading to a brand-customer relationship and drive purchase decisions.
Luxury
Food
Auto
Services
Brand
Intangibles
Financial
Tangibles
IT
Pharma
Cemicals
0%
20%
Interbrand 2006
40%
60%
80%
100%
Aaker chap. 3

29. A Brand-customer relationship
A brand-customer relationship can be based on:
1. The value proposition
2. The brand identity
– many brand-customer relationships emerge when the brand is considered as
an organisation or person rather than a product.
Aaker chap. 3

30. First impressions count
How long time..
To…
500 millisec. Conscious reaction will be remembered
110
100 m sprinters reaction to start pistol
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Notice visual signal and decide fight, flee or stay

31. • Brand image= how the brand is now percived
• Brand identity=how strategists want the
brand to be perceived
• Brand position=that part of the brand identity
and value proposition that needs to be
actively communicated to the targeted
audiences
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32. The brand has to be lived

33. … so the brand perception is not just
good products or clever marketing:
It’s everything we say, everything we do!

34. Why is it hard to build strong brands?
Pressure to
compete on price
Short-term pressures
Proliferation of competitors
Pressure to
invest elsewhere
Fragmenting
markets and media
Complexity
Bias against innovation
Complex brand
strategies and relationships
Bias towards
changing strategies
Aaker chap. 1

35. Creating awareness
• Establishing recall and recognition is vital
• The challenge is to break through the clutter
and create awareness (recall and recognition)
Aaker chap. 1

36. Creating perceptions of quality
• A claim of quality must always be based on substance and knowledge

Creating quality is not enough – the company must
create perceptions of quality
↔

Companies must work to maintain/deliver quality
Present perception based on previous experience (good
and bad)

Aaker chap. 1

37. Brand loyalty
• Brand value is largely created by customer
loyalty
• A brand without loyalty is vulnerable
• Loyalty has great impact on marketing costs
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38. Enhancing loyalty
•
Develop or strengthen customers’ relations with the brand
•
Segmentation
– Non-customers, price switchers, passively loyal, fence sitters and committed
– Ladder
•
Brand awareness, perceived quality and clear brand identity can help
enhance loyalty, but also loyalty programmes (increasingly popular)
Aaker chap. 1

39. Today, brands are abundant and we live in an over-communicated
noisy world

40. Brand identity TRAPS
2. The brand position trap
– A brand position is the part of the brand identity and value
proposition that is to be actively communicated to the target
audiences and that demonstrates an advantage over competing
brands.
– The brand position trap occurs when the search for a brand identity
becomes a search for a brand position.
• Broad < Narrow = less activity guidance
3. The external perspective trap
– The firms fail to realize the role that a brand identity can play in
helping an organisation understand its basic values and purpose.
– Identity < Why customer buy the product
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41. 4. The product-attribute fixation trap
•
•
•
The most common trap.
The trap occurs when the strategic and tactical management of the brand
is focused solely on product attributes
A brand is more than a product. The failure to distinguish between a
product and a brand creates the product-attribute fixation trap.
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42. Dove Real Beauty Sketches
• http://www.youtube.com/watch?
v=litXW91UauE women
• http://www.youtube.com/watch?
v=ChY9DoEtE-4 men
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