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MIDTERM 1: Chapter 1 - 7

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Ryerson University
MKT 510
Marla Spergel

Midterm 1 Review: Chapter 1, 2, 3, 4, 5, 6, 7 Chapter 1 What is a brand? Vs product? -word brand is derived from the word brandr which means to burn -according to American Marketing Association (AMA) brand is a name, symbol, term, sign, symbol, design or combination of them which is intended to identify the goods and services -when a marker has created a new name, logo, symbol for a new product they have created a brand -brand creates awareness, reputation, prominence and so on -AMAs definition is different than the industry; AMA believes the key to create a brand is to choose a name, logo, symbol, package design etc (these components are actually brand elements) Example: companies like GE and Samsung use their name for essentially all their products whereas some manufacturers assign new products different brand names, for instance Procter & Gamble has Tide, Pampers, Pantene etc -brands are based on people (Estee Lauder cosmetics) -brands are named on places (British Airways) -brands are named on animals (Mustang, Dove soap) -brands also have an others category which has Apple computers, Shell gasoline, Carnation milk -some brand names use words to inherent the product meaning (DieHard batteries, Beautyrest mattresses) -some brand names are made up which include prefix/suffixes to make it sound scientific (Intel, Lexus automobiles) -brand elements such as logos, symbols can also be based on people, place, things etc which gives the brand and marketer many choices -product is anything that can be offered to market for attention, acquisition, use, consumption which will stratify need or want -product can be physical (cereal, tennis racquet, car) -product can be a service (airline, bank, insurance company) -product can be a retail outlet (department store, specialty store, supermarket) -product can be a person (political figure, entertainer, athlete) -product can be organization (non profit, trade organization) -product can be a place (city, state, country) -product can be an idea (political or social cause) Five Levels of Meaning for a Product: (1) The core benefit level is the fundamental need or want that consumers satisfy by consuming the product or service (2) The generic product level is a basic version of the product containing only those attributes or characteristics absolutely necessary for its functioning but with no distinguishing features. This is basically a stripped-down, no-frills version of the product that adequately performs the product function. (3) The expected product level is a set of attributes or characteristics that buyers normally expect and agree to when they purchase a product. (4) The augmented product level includes additional product attributes, benefits, or related services that distinguish the product from competitors. (5) The potential product level includes all the augmentations and transformations that a product might ultimately undergo in the future. -brand is more than a product because it has dimensions that differentiate it in some ways from more than a product which is designed to satisfy the same need differences can be rational & tangible; can be related to product performance of brand can be symbolic, emotional & intangible; related to what brand represents -some brands create competitive advantage with product performance Example: Gillette has been a leader in their product category for decades due to continual innovation -some brands create competitive advantage through non-product- related means Example: Coca-Cola has been the leader in their product category for decades by understanding consumer motivations and desires and creating relevant/appealing images for their product 4 Steps in the Strategic Brand Management Process: -involves the design and implementation of marketing programs and activities to build, measure and manage brand equity -consists of 4 parts: (1) Identifying and establishing brand positioning: -starts with a clear understanding of what brand is and how it should be positioned with respect to competitors -potential benefit to the firm is maximized -convince consumers of the advantages or point of difference a brand has over competitors (establishing points of parity) -positioning also specifics the appropriate brand association and brand mantra (statement that is frequently repeated) -mental map is a visual depiction of the different types of associations liked to athe brand in the minds of consumers -core band associations are the subsets of associations (attributes and benefits) that best characterize the brand -brand mantra is a short 3-5 word expression of the most important aspects of a brand and its core brand association -heart and soul of the brand include are core brand associations, points of parity, points of difference, and brand mantra (2) Planning and Implementing Brand Marketing Programs: -building brand equity requires creating a brand that consumers are aware of which has a strong and unique brand association -depends on 3 factors: Initial choice of the brand elements or identities making up how the brand and how they are mixed/matched Marketing activities, supporting marketing program and the way the brand is integrated into them Associations indirectly transferred to by the brand as a result of linking it to some other entity (3) Measuring and Interpreting Brand Performance: -task of determining a brands positioning often benefits from a brand audit -brand audit is a comprehensive examination of a brand to assess its health, uncover its source of equity and suggest ways to improve and leverage the equity -once marketers have determined the brand positioning strategy, they are ready to put into place the actual marketing program to create, strength or maintain brand associations -brand value chain is a means to trace the value creation process for brands, to better understand the financial impact of brand marketing expenditures and investments -in order for managers to successfully design and implement a brand equity measurement system which is a set of research procedures designed to provide timely, accurate and actionable information for marketers (4) Growing and Sustaining Brand Equity: -managing brand equity means managing brands within the context of other brands as well as over many categories, over time and across many market segments Branding Challenges and Opportunities (1) Savy Customers: -consumers & business have become more experienced with marketing, more knowledgeable about how it works and more demanding -media market pays increased attention to companies marketing actions and motivation -consumer information and support exists in the form of consumer guides, web sites, influential blogs etc -firms conduct annual surveys, and have found that consumer expectation of what they want from brands is around 13% higher than what they think brands will deliver for them -one commentator said that the dollars that were spent on advertising in the 1950s are still paying off, it was so cheap to get a large share of voice; it would be impossible now, people are more likely not to believe what they see on tv -another marketer believes that what consumers want from products and services and brands have changed Brands now need to create trustmarks a name, symbol that emotionally bits a company with the desire and aspiration of its customers -everything today can be seen related to love-respect, these days high love ratings win; if I dont love what you are offering, I am not even interested -love and emotional connection to the brand is critical (2) Brand Proliferation: -important as new brands and product rise in line and brand extension -a brand name can now be identified with a number of different products with similarity -marketers of brands such as Coke, Dove, Nivea have added new products under their brand umbrella -there are very few single (mono) product brands around now (3) Media Fragmentation: -another change is the fragmentation of traditional advertising media and the emergence of interactive and nontraditional media, promotion and other communication alternatives Cost: price of network TV has increased dramatically in many countries Clutter: commercial breaks on TV have become more crowded since advertisers chose to advertise with a 10-15 second spot (before it used to be 30-60 seconds) Fragmentation: growth of independent stations and cable channels has resulted in a dramatic erosion of the network share
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