Product & Service
Strategies
Branding
• Creating, maintaining, protecting, and enhancing products
and services.
• A brand is a name, term, sign, symbol, or design, or a
combination of these, that identifies the maker or seller of a
product or service.
Branding
The AMA definition of a brand:
“A name, term, sign, symbol, or design, or a combination of
these, intended to identify the goods or services of one seller
or group of sellers and to differentiate them from the
competition.”
Branding
Brand represents the consumer’s perceptions and feelings about a
product and its performance. It is the company’s promise to
deliver a specific set of features, benefits, services, and
experiences consistently to the buyers
Branding
Mobil is the world's leading
synthetic motor oil brand. It is
recommended by name by more
auto manufacturers than any other
motor oil brand in the world.
9-4
Branding
• Advantages to buyers:
Product identification
Product quality
• Advantages to sellers:
Basis for product’s quality story
Provides legal protection
Helps to segment markets
Brand Equity
The positive differential effect that knowing the brand name has on
customer response to the product or service.
How much more are you willing to pay for the brand of
your choice?
One study found that customers are willing to
20% more for the brand of their choice relative
to its nearest competitor. Tide & Heinz lovers
will pay a 100% premium. Loyal Coke drinkers
will pay a 50% premium.
Brand Equity
Brands with strong equity have many competitive advantages:
High consumer awareness
Strong brand loyalty
Helps when introducing new products
Less susceptible to price competition
Basis for strong, profitable customer relationships
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Major Brand Strategy Decisions
Brand Brand Brand Brand
positioning name sponsorship development
selections
Brand Positioning
Can position brands at any of three levels:
Product attributes – Dove soap ¼ cleansing cream
Competitors can easily copy attributes
Product benefits – Dove soap benefit of softer skin
Volvo (safety), Nike (performance), FedEx (overnight),
Lexus (quality)
Beliefs and values (Emotion) - Dove soap softer skin will
make you more attractive
Brand Name Selection
Desirable qualities for a brand name include:
1. It should suggest product’s benefits and qualities
Craftsman – America’s most trusted tool brand
2. It should be easy to pronounce, recognize, and remember
Tide, Crest
3. It should be distinctive
Kodak
4. It should be extendable
Amazon.com (started as bookseller but expanded to
other products)
5. It should translate easily into foreign languages
6. It should be capable of registration and legal protection
Brand Sponsorship
• Manufacturer’s brands - Sony Bravia HDTV or Kellogg’s Frosted
Flakes
• Private brands (store brands) - Sears created Craftsman
• Licensed brands - Character names: Scooby-Doo, Donald Duck
• Co-branding - Nike and Apple co-branded the Nike-iPod Sport
Kit, which lets runners link their Nike shoes with their iPods to track
and enhance running performance in real time.
Brand Development
• Line Extension: introduction of additional items in a given product line
under the same brand name (e.g., new flavors, forms, colors,
ingredients, or package sizes).
• Coke has more than 16 varieties. In zero calorie versions alone, coke
comes in three sub brands- Diet coke, Diet coke with splenda & Coca-
Cola zero. In flavored and free versions- Diet cherry coke, Diet coke
with lemon etc.
Brand Development
• Brand Extension: using a successful brand name to launch a new or
modified product in a new product category. A company using brand
extension hopes to leverage its existing customer base and brand
loyalty to increase its profits with a new product offering.
• Starbucks coffee company creating Starbucks ice cream, to be sold not
at Starbucks retail stores but in grocery stores. The ice cream flavors
were based on the flavors of frappucinos Starbucks sold in its coffee
shops.
Brand Development
• For brand extension to be successful, there usually must be some
logical association between the original product and the new one. A
weak or nonexistent association can result in brand dilution. Also, if a
brand extension is unsuccessful, it can harm the parent brand.
e.g. Heinz pet food – bad idea
Brand Development
• Multibranding: The marketing of more than two or more brands,
belonging to the same or related category, by a company is called
multi-branding. In this case, the brands are mostly substitutes of each
other.
• Hindustan Unilever Ltd (HUL) has a number of bathing soap brands,
for example Breeze, Dove, Hamam, Lifebuoy, Lux, etc. This is an
example of multi branding since there are many soap brands under
the category of bathing soaps under the umbrella of HUL.
Brand Development
• New Brands: developed based on belief that the power of its existing
brand is waning and a new brand name is needed. Also used for
products in new product category.
Brand Development
Product Category
Existing New
Existing Line Brand
Extension
Brand Name
Extension
New
Multibrands New
Brands
Thank You
