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MKT510 Exam Review - Ch. 1, 2, 3.docx

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Department
Marketing
Course
MKT 510
Professor
Ida Berger
Semester
Fall

Description
Chapter 1 – Brands and Brand Management Lecture on: September 6, 2012 What is a Brand? - Brand: name, term, sign, symbol, or design, or a combination of them, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competition - Brand elements: different components of a brand that identify and differentiate it. Example: name, logo, symbol, etc. - Brands versus products: o Product: anything we can offer to a market for attention, acquisition, use, or consumption that might satisfy a need or want o We can define five levels of meaning for a product:  Core benefit level  Generic product level  Expected product level  Augmented product level: additional product attributes, benefits, or related services that distinguish the product from competitors  Potential product level: includes all the augmentations and transformations that a product might ultimately undergo in the future o A brand is more than a product, because it can have dimensions that differentiate it in some way from other products designed to satisfy the same need Why do Brands matter? - For consumers, and for manufactures: refer page 7 - Search goods: like groceries, consumers can evaluate product attributes by visual inspection - Experience goods: like tires, cannot be easily evaluated through inspection. Experience and actual product trial is necessary - Credence goods: like insurance coverage, consumers may rarely learn product attributes. Brands are an important signal of quality and other characteristics - Brands can reduce the risks in product decisions: o Functional risk: the product does not perform up to expectations o Physical risk: the product poses a threat to the physical well-being or health of the user or others o Financial risk: the product is not worth the price o Social risk: embarrassment o Psychological risk: affects the mental well-being of user o Time risk: failure of the product results in an opportunity cost of finding another satisfactory product Can everything be branded? - A brand is something that resides in the minds of consumers - The key to branding is that consumers perceive differences among brands in a product category - Commodity: a product so basic that it cannot be physically differentiated in the minds of consumers o Marketers have been able to brand what were once commodities - Physical goods, services, retailers and distributors, online products and services, people and organizations, sports, arts, and entertainment, geographic locations, ideas and causes, can all be branded Branding challenges and opportunities - Savvy customers: simply not enough for a company to be respected anymore – a company must be loved - Brand proliferation: a brand may now be identified with a number of different products with varying degrees of similarities - Media fragmentation: growth of cost, clutter, fragmentation, and technology which gives consumers the option of skipping commercials - Increased competition - Increased costs - Greater accountability Strategic brand management process - Strategic brand management: involves the design and implementation of marketing programs and activities to build, measure, and manage brand equity - Process: o Identifying and establishing brand positioning o Planning and implementing brand marketing programs  The initial choices of the brand elements or identities  The marketing activities and supporting marketing program  Other associations indirectly transferred to or leveraged by the brand o Measuring and implementing brand performance  Brand audit: comprehensive examination of a brand to assess its health, uncover its sources of equity, and suggest ways to improve and leverage that equity  Brand value chain: means to trace the value creation process for brands, to better understand the financial impact of brand marketing expenditures and investments o Growing and sustaining brand equity  Defining the branding strategy  Brand-product matrix: graphical representation of all the brands and products sold by the firm  Brand hierarchy: displays the number and nature of common and distinctive brand components across the firm’s products  Brand portfolio: set of all brands and brand lines that a particular firm offers for sale to buyers in a particular category  Managing brand equity over time  Managing brand equity over geographic boundaries, cultures, and market segments Chapter 2: Customer-Based Brand Equity Lecture on: September 13, 2012 Customer-based brand equity - The power of a brand lies in what resides in the minds of customers - Customer-based brand equity: differential effect that brand knowledge has on consumer response to the marketing of that brand - Key ingredients of this definition: o Differential effect o Brand knowledge o Consumer response to marketing Making a brand strong: brand knowledge - Associative network memory model: views memory as network of nodes and connecting links - Brand awareness: strength of the brand node or trace in memory, which we can measure as the consumer’s ability to identify the brand under different conditions - Brand image: consumers’ perceptions of a brand Sources of brand equity - Customer-based brand equity occurs when the consumer has a high level of awareness and familiarity with the brand and holds some strong, favourable, and unique brand associations in memory - Brand awareness: o Brand recognition: ability to confirm prior exposure to a brand when given the brand as a cue o Brand recall: ability to retrieve the brand from memory when given the product category, the needs fulfilled by the category, or a purchase or usage situation as a cue o Advantages of brand awareness:  Learning advantages:  Consideration advantages: when the brand is part of a consumer’s consideration set  Choice advantages:  Consumer purchase motivation  Consumer purchase ability o We can create brand awareness by increasing the familiarity of the brand through repeated exposure (for brand recognition) and forging strong associations with the appropriate product category or other relevant purchase or consumption cues (for brand recall) - Brand image: o The more deeply a person thinks about product information and relates it to existing brand knowledge, the stronger the resulting brand associations will be o Brand attributes: descriptive features that characterize a product or service o Brand benefits: personal value and meaning that consumers attach to the product/service attributes o Favorability of brand associations:  Desirability: depends on 3 factors – how relevant, how distinctive, and how believable consumers find the brand association  Deliverability: depends on – actual or potential ability of the product to perform, the current or future prospects of communicating that performance, and the sustainability of the actual and communicated performance over time Building a strong brand: the four steps of brand building 1. Ensure identification of the brand with customers and an association of the brand in customers’ minds with a specific product class or customer need 2. Firmly establish the totality of brand meaning in the minds of customers by strategically linking a host of tangible and intangible brand associations with certain properties 3. Elicit the proper customer responses to this brand meaning 4. Convert brand response to create on intense, active loyalty relationship between customers an
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