Ch. 3 Branding Strategy and Consumer Behaviour

opportunities matrix

diversification

new products, new markets

• product line extensions

• eg. arm and hammer toothpaste, carpet cleaner

market development

existing products, new markets

• new uses

• eg. arm and hammer baking soda deodorizes fridges, sinks, and freezers

product development

new products, existing markets

• product improvements

• eg. variations on a theme, arm and hammer baking soda for cakes vs cookies vs breads

market penetration

existing products, existing markets

• sales promotions

diffusion of innovations

the rate at which a new product spreads or is adopted across the marketplace

the rate is influenced by

• relative advantage of the new product

• compatibility with consumers lifestyles

• complexity

• observability

• perceived risk

• trialability

pioneering brand advantage

the first brands to enter a new market often enjoy a long term preference advantage over copycat brands

product life cycle

introduction stage

focus on innovators / innovators try product

• create awareness

• induce trial

• advertise

• promote

growth stage

snowball effect, focus on early adopters

• build market share

• stimulate WOM

• new segments

• brand extensions

maturity stage

when maximum adoption happens, focus on early majority

• control costs

• production efficiency

• monitor competition

decline stage

category attrition, focus on late majority

• harvest

• rejuvenate

strategies for extending the product life cycle

• does the product have a new or extended use?

• is the product category “under-advertised”?

• is there a broader target market?

• can you cut price and build volume and profit?

• is there a social trend ot exploit?

• can you expand distribution channels?

brand

• the names, terms, designs, symbols, or other features that identify a good/service

• provides a way to differentiate the product offering

• triggers strong associations stored in consumers memories

brand resonance

refers to a consumers intense and actively loyal relationship with a brand

• leads to high purchase frequencies and volumes, feelings of attachment, feelings of brand community or kinship with other users of the brand, and active engagement like joining clubs associated with the brand

brand equity

• the value of a brand above and beyond its measurable attributes

• the positive differential effect that knowing the brand name has on customer response to the product or service

• can be measured by comparing consumers evaluation of the same product with and without the brand name attached

brand awareness

familiar with brand and what it stands for; have an opinon or attitude about the brand

perceived value

benefit to cost relationship compared to competition

brand loyalty

measured by consumers repeat purchases

brand associations

mental links that consumers make between a brand and its key product attributes

building a strong brand

• establish strong brand identity (distinction)

• build strong brand meaning (knowledge)

• foster strong brand responses (positive feelings)

brand resonance pyramid

measures to determine the value of a brand

• brand strength (brand vitality) - differentiation x relevance

• brand stature (esteem x knowledge)

brand strength

differentiation x relevance

• differentiation: is the brand perceived as different from other brands?

• relevance: are the differentiated benefits relevant to consumers

brand stature

esteem x knowledge

• esteem: is the brand highly regarded (respected) and liked

• knowledge: are consumers knowledgeable about the brand and its benefits? does it have a clear consistent image?

brand equity chart

warmth competence model

product line management

how to deliver value

• one product or many?

• one brand or many?

product line breadth

how many different products a firm should offer

cannibalization

when the sales of one product take sales away from another product in the same product line

• more likely to occur when consumers are brand loyal vs attribute loyal

brand loyal

consumers have a strong preference for a brand and so are more likely to continue o buy products within a brand

attribute loyal

consumers have a strong preference for a particular attribute and are more likely to switch brands in search of that attribute

acquisition strategies (managing continued growth)

strategies that attract new customers

retention strategies (managing continued growth)

strategies that retain current customers