MGMC11H3 Chapter Notes - Chapter 1-6: Psychographic

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12 Mar 2015
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2015-02-17
Brand:
1. Brands are needed to reduce risks, simplify decision making, and set expectations invaluable.
Brand is A name, term, sign, symbol, design or combination of these, intended to identify & differentiate
one’s good or services
Something that creates awareness, reputation, even prominence in the marketplace.
It is a perceptual entity, it is something that resides in minds of people.
However, managers argue that is more than that. It is an expression of a relationship.
Brand equity = brand awareness + brand attitude
When strong companies create asset out of it, it is called Goodwill.
Brand elements – logo, symbol, tune, package designs and other characteristics.
How does a brand help consumers and businesses?
For customers: it helps identify the source, assigns responsibility on the manufacturer, reduces risks,
reduces cost for search, promise and bond with the manufacturer, symbolic device, signal of quality
When a consumer has already had experience with certain brand, he or she is likely to have formulated an
opinion with the brand and use or buy it next time.
For producers: legal property that is capable of influencing consumer behaviour, can be bought and
sold, and can provide security for future revenues. Operationally: identification purpose, simplifies handling,
for inventory and accounting records. Retains intellectual property rights: legally protecting unique features,
means of quality level source of competitive advantage, source of financial returns, a mean endowing
product with unique associations. Impressions on the minds of consumers from years of marketing
activities cannot be erased easily.
Product – Anything we can offer to a market for attention, acquisition, use or consumption that may
satisfy a motivation (toward pleasure or away from pain).
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A brand is different because it is meant to differentiate products that have the same purpose. It can create
competitive advantage through both product performances and non-product related means.
5 levels of product meaning:
Core benefit level – fundamental need that consumer satisfies by consuming that product
Generic product level – a product that consists of only those attributes that are absolutely necessary
for its functioning, no distinguishing features
Expected product level – attributes that consumers normally expect from product
Augmented product level – additional benefits and attributes that distinguish the product from
competitors
Potential product level – the transformations that a product might undergo in the future
2 major good categories:
Search goods – can visually assess the attributes (clothing, groceries)
Experience goods – cant be visually inspected, so needs usage and trial (automobile tire)
Credence goods – can rarely ever learn the product attributes (insurance coverage)
(for the last 2, more brand quality signal is more important)
The risks associated with products: functional, physical (threat to health etc.), financial (not worth the
price paid), social (embarrassment from others), time (opportunity cost from other satisfactory product)
One way to handle these risks: buy trusted brand)
Can anything be branded?
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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.
Brands play an important decision making role for consumers.
For Physical goods
B2B: Just because it is B2B, doesn’t mean that the importance of branding and reputation is low. Not all is
relied on the quality. Enterprising spirit (why), precision performance (how), and defining the future (what)
are three important aspects.
High tech goods:
Just like in consumer market it is important to segment the customers who are businesses, and use
marketing strategies and techniques.
For services:
Challenge – less tangible and quality may differ depending on the staff and people providing it
Brand symbols are important to make the vague services more concrete
For professional services: (consulting, banking, and law) the key attributes are: credibility: expertise,
trustworthiness, and likeability and long-term relationship with customers
For retailers and distributors: can create their own brand by the goods they are selling in store, allowing
people to know what to expect. Also, they can introduce their own store brands or private label brands,
which also creates image.
Online products and services:
Have to be well positioned and have to find unique qualities to satisfy customers unmet needs. (if it does
well, they can avoid marketing costs and just increase awareness with word of mouth and publicity)
Have to have unique positioning, but at the same time to have satisfactory product category aspects.
People and organizations
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