MGTC21: Chapter 1 Notes
What is a Brand?
- comes from the old Norse word brandr which means to burn
- is a “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.
- Some brand name strategies are using them for all products, individual brand names like P&G, and some
retailers create their own brand like Sam’s Club
- Product is anything we can offer to market for attention, acquisition, use or consumption that might satisfy a
need or want
- 5 levels of meaning for a product
o Core benefit level – is the fundamental need or want that consumers satisfy by consuming
o Generic product level – basic version of product containing only those atricutes necessary for function
and no distinguishing features
o Expected product level – set of attribute that buys normally expect and agree to when they purchase a
o Augmented product level – incldes additional product attributes, benefits or related services that
distinguish the product from competitors
o Potential product level – includes all the augmentations and transformations that a product might
ultimately undergo in the future
- Harvard’s Ted Levitt argued that “new competition not between stuff produced but what they add in form of
packaging, services, advertising, and other things people value
- Brand is therefore more than a product, because it can have dimensions that differentiate it in some way from
other products designed to satisfy the same need.
- Distinguish brands by
o Competitive advantages with product performance
o Through non-product related means like Coke who create a fun image
- Brands carry a number of different types of associations
Why Do Brands Matter?
o to them brands provide source or maker of product and assign responsibility to them
o take on special meaning to consumers because of past experience or marketing program
o simplicfication of their product decisions
o search cost reducer, symbolic, signal of quality, promise
o Search goods – ex. Grocery. Consumers can evaluate product by sturdiness, size, colour, design
o Experience goods – cannot be assessed so easily by inspection. Need actual product trial and experience
to learn quality, safety etc. ex. Tires
o Credence Goods – may rarely learn product attributes because of difficulty ex. Insurance converage
o Provide a number of valuable function to their firms like identification, organize inventory, legal
protection, retain intellectual property rights.
o To firms brands represent enormously valuable pieces of legal property, capable of influcencing
consumer behavior, being bought and sold, and providing the security of future earnings
o Most value of firm is in intangible assets and goodwill. As much of 70% of intangibles can be supplied by
- Can everything be branded?
o A brand is a perceptual entity rooted in reality but reflects perceptions and perhaps the idiosyncrasies of
o To brand a product it is necessary to teach consumers “who” the product is by giving a name and using
other brand elements to help identify. “a Label for the product”
o “Key to branding is that consumers perceive differences among brands in a product category” o commodity is a product so basic it cannot be physically differentiated in minds of consuemrs like soap,
beer. These products have been branded as well.
o Technology companies have struggled with branding
o Challenges in marketing services is because less tangible and likely to vary in quality depending on
particular person or people.
o Reatilaers can introduc