1

Chapter No.1
1-What is Brand?
A brand is a name, term, sign, symbol or a combination of them intended toidentify the goods and
services of one seller or group of sellers and todifferentiate them from those of competition. For example,
Coke, Nestle andMicrosoft are well renowned brands. In technical speaking whenever a marketercreates a
name logo symbol he or she has created a brand.
2-Why do Brands matters?
Brands really matter for both consumer and manufacturer.
From consumer’s point of view:
 Identification of source of product
 Assignment of responsibility to product maker
 Risk reducer
 Search cost reducer
 Promise, bond, or pact with maker of product
 Symbolic device
 Signal of quality
 Brands identify the source or maker of a product and allow
consumers to assign responsibility to a particular manufacturer.From an economic perspective, brands
allow consumers to lowersearch costs for products both internally and externally.
 Consumers offer their trust and loyalty with the implicit
understanding that the brand will behave in certain ways andprovide them utility through consistent
product performance andappropriate pricing, promotion, and distribution programs andactions. Brands
can serve as symbolic devices, allowingconsumers to project their self-image.
 Certain brads are associated with being used by certain types of
people and thus reflect different values or traits. Researched have
classified products and their associated attributes into three major

categories: search goods, experience goods and credence goods.There is difficulty in assessing and
interpreting product attributesand benefits so with experience and credence goods, brands maybe
particularly important signals of quality. Brands can reduce therisk in product decisions. These risks
involve functional, physical,financial, social psychological and time risk.
From manufacturer’s point of view:
 Means of identification to simplify handling
 Means of legally protecting unique features
 Signal of quality level to satisfied customers
 Means of endowing products with unique associations
 Source of competitive advantage
 Source of financial returns
Brands help manufacturers to organize inventory and accounting records. Abrand also offers the firm
legal protection for unique features of the product. Abrand can retain intellectual property rights, giving
legal title to the brand owner.Brands can signal a certain level of quality so that satisfied buyers can
easilychoose the product again. This brand loyalty provides predictability and securityof demand for the
firm and creates barriers of entry that make it difficult for otherfirms to enter the market.
The annual list of the world’s most valuable brands, published byInterbrand andBusiness Week,
indicates that the market value of companies often consistslargely of brand equity. Research by McKinsey
& Company, a global consultingfirm, in 2000 suggested that strong, well-leveraged brands produce
higherreturns to shareholders than weaker, narrower brands. Taken together, thismeans that brands
seriously impact shareholder value, which ultimately makesbranding a CEO responsibility
Companies sometimes want to reduce the number of brands that they market.This process is known as
"Brand rationalization." Some companies tend to createmore brands and product variations within a brand
than economies of scalewould indicate. Sometimes, they will create a specific service or product brandfor
each market that they target. In the case of product branding, this may be togain retail shelf space (and
reduce the amount of shelf space allocated tocompeting brands). A company may decide to rationalize
their portfolio of brandsfrom time to time to gain production and marketing efficiency, or to rationalize
abrand portfolio as part of corporate restructuring.

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3-What are the strongest Brands?
A list of top twenty strongest brands is as follows
2005
Brand
Rank
Brand Name
Country of
ownership
2005 Brand
Value ($million)
1
Coca-Cola
U.S
67,525
2
Microsoft
U.S
59,941
3
IBM
U.S
53,376
4
GE
U.S
46,996
5
Intel
U.S
35,588
6
Nokia
Finland
26,452
7
Disney
U.S
26,441
8
Mc Donald
U.S
26,014
9
Toyota
Japan
24,837
10
Marlboro
U.S
21,189
11
Mercedes-Benz
Germany
20,006
12
Citi
U.S
19,967
13
Hewlett Packard
U.S
18,866
14
American
Express
U.S
18,559
15
Gillette
U.S
17,534
16
BMW
Germany
17,126
17
Cisco
U.S
16,592
18
Louis Vuitton
France
16,077
19
Honda
Japan
15,788
20
Samsung
S. Korea
14,956

Chapter No. 2
Customer Based Brand Equity
Customer based brand equity model is that the power of a brand lies in whatcustomers have learned, felt,
seen, and heard about the brand as a result of theirexperience over time. Customer-based brand equity is
defined as the differentialeffect that brand knowledge has on consumer response to the marketing of
thatbrand. There are three key ingredients of this definition: (1) “differential effect,”(2) “brand
knowledge,” (3) “consumer response to marketing.”
Brand Equity as a Bridge
The power of a brand lies in the minds of consumers and what they haveexperienced and learned about
the brand over time. Consumer knowledge drivesthe differences that manifest themselves in terms of
brand equity. This realizationhas important managerial implications. According to this view, brand
equityprovides marketers with a vital strategic bridge from their past to their future.Brand equity can
provide marketers with a means to interpret their pastmarketing performance and design their future
marketing programs.
Building a strong Brand
There are four steps of building a strong brand. These are as follows:
1.Ensure identification of the brand with customers and as association of the
brand in customers’ minds with a specific product class or customer need.
2.Firmly establish the totality of brand meaning in the minds of customers by
strategically linking a host of tangible and intangible brand associations
with certain properties.
3.Elicit the proper customer responses to this brand identification and brand
meaning.
4.Convert brand response to create an intense, active loyalty relationship
between customers and the brand.
These steps represent fundamental questions that customers can ask about
brands as follow:
1.Who are you? (Brand identity)
2.What are you? (Brand meaning)
3.What about you? (Brand responses)
4.What about you and me? (Brand relationship

Brand Building Blocks

To provide some structure, it is useful to think of sequentially establishing sixbrand building blocks with
customers. These brand building blocks can beassembled in terms of a brand pyramid. Each brand
building block will beexamined in the following section.
Brand Salience
Achieving the right brand identity involves creating brand salience withcustomers. It relates to the aspects
of the awareness of the brand, for examplehow often and easily the brand is evoked under various
situations? Brandawareness refers to customers’ ability to recall and recognize the brand, asreflected by
their ability to identify the brand under different conditions.
Brand Performance
Designing and delivering a product that fully satisfies consumer needs and wantsis a prerequisite for
successful marketing. To create brand loyalty and resonanceconsumer experience with the product must
at least meet. Brand performancerelates to the ways in which the product or service attempts to meet
customersmore functional needs. Customers can view the performance of products orservices in a broad
manner. Reliability refers to the consistency of performanceover time and from purchase to purchase.
Durability refers to the expectedeconomic life of the product. Serviceability refers to the ease of servicing
theproduct. Performance may also depend on sensory aspects such as how aproduct looks and feels.
Brand Imagery
Brand imagery deals with the extrinsic properties of the product including theways in which the brand
attempt to meet customer psychological needs. Brandimagery is how people think about a brand
abstractly rather than what they thinkthe brand actually does. Thus imagery refers to more intangible
aspects of thebrand.
Brand Judgments
Brand judgments focus on customers’ personal opinions and evaluation withregard to the brand. To create
a strong brand four types of brand judgmentssummary are particular important: Quality, Credibility,
Consideration andSuperiority.

Brand Feelings
Brand feelings are customers’ emotional responses and reaction with respect tobrand. Brand feelings also
relate to the social currency evoked by the brand. Thefollowing are six important types of brand-building
feelings
1.Warmth: The brand makes consumers feel a sense of calm.
2.Fun: The brand makes consumers feel amused, playful, and cheerful and
so on.
3.Excitement: The brand makes consumers feel energetic and feel that they
are experiencing with something special.
4.Security: The brand produces a feeling of safety.
5.Self-respect: The brand makes consumers feel better about themselves.
6.Social approval: The brand results in consumers having positive feeling
about the reactions of others.
Brand Resonance
Brand resonance refers to the nature of the relationship and the extent to whichcustomers feel that they
are “in sync” with the brand. Brand resonance can bebroken down into four categories
 Behavioral Loyalty
 Attitudinal Attachment
 Sense of Community
 Active Engagement
The fist dimension is behavioral loyalty in terms of repeat purchase. How oftendo customers purchase a
brand and how much do they purchase? Behavioralloyalty is necessary but not sufficient for resonance to
occur. To createresonance, there are also needs to be a strong personal attachment. Customersshould go
beyond having a positive attitude to viewing the brand as beingsomething special. Creating greater loyalty
requires deeper attitudinalattachment, which can be generated by developing marketing programs
andproducts and services that fully satisfy consumer needs.
Identification with a brand community may reflect an important socialphenomenon whereby customers
feel affiliation with other people associated withthe brand. Strong attitudinal attachment or social identity
or both are typicallynecessary, however, for active engagement with the brand to occur.

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Chapter No. 3
Identifying and Establishing Brand Positioning
Brand positioning is defined as the “act of designing the company’s offer andimage so that it occupies a
distinct and valued place in the target customer’sminds. Positioning is all about identifying the optimal
location of a brand and itscompetitors in the minds of consumers to maximize potential benefit to the
firm.According to customer based brand equity model, deciding on a positioningrequires determining a
frame of reference by identifying the target market and thenature of competition and the ideal points-of-
parity and points-of-difference brandassociation.
Target Market
A market is the set of all actual and potential buyers who have sufficientmotivation, ability and
opportunity to buy a product. Market segmentationinvolves dividing the market into distinct groups of
homogeneous consumers whohave similar needs and consumer behavior and thus require similar
marketmixes. All companies never target all of its segments. There is a criterion underwhich segments are
targeted.
 Identifiably: Can segment identification be easily determined?
 Size: Is there adequate sales potential in the segment?
 Accessibility: Are specialized distribution outlets and communication
media available to reach the segment?
 Responsiveness: How favorably will the segment respond to a tailored
marketing program?
From manufacturer perspective the model segments users of a brand is divided
into four groups based on strength of commitment from low to high, as follows:
1.Convertible: High likely to switch brands
2.Shallow: Not ready to switch, but may be considering alternatives
3.Average: Comfortable with their choice; unlikely to switch in the future
4.Entrenched: Highly loyal; unlikely to change in the foreseeable future
From customer perspective the model also classifies nonusers of a brand intofour groups based on their
openness to trying the brand from low to high, asfollows:
1.Strongly unavailable: Strongly prefer their current brand
2.Weakly unavailable: Preference lies with their current brand, although not
strongly
3.Ambivalent: As attracted to the other brand as to their current choice

Final Assignment
Brand Management
COMSATS Institute of Information Technology Lahore
8
4.Available: Prefer the other brand but have not yet switched
Points of Parity
Points of parity are those associations that consumers view as being necessaryto be a legitimate and
credible offering within a certain product category. A pointof parity is easier to achieve than points of
difference. For example there is aminimal difference between Surf excel and Ariel washing powder.
Points of Difference
Points of difference are attributes that consumers strongly associate with a brandpositively evaluate, and
believe that they could not find to the same extent with acompetitive brand. For example whenTel
enor launch first time easy load itcreated points of difference at that time. Points of difference may
involveperformance attributes. Many top brands attempt to create a point of differenceon overall superior
quality.
Defining and Establishing Brand Values
Core Brand Values
Core brand values are those set of attributes that characterize the five to tenmost important aspects of a
brand. Core brand values can serve as the basis ofbrand positioning in terms of how they relate to points
of parity and points ofdifference. Core brand values can be identified through structured process. Thefirst
step is to create a detailed mental map of the brand. A mental mapaccurately portrays in detail all salient
brand associations and responses for aparticular target market. Mental maps must reflect the reality of
how the brand isactually perceived by consumers in terms of their beliefs, attitudes, opinions,feelings,
images and experiences.
Brand Mantras
A brand mantra is highly related to handing concepts such as brand essenceused by others. A brand
mantra is an articulation of the heart and soul of thebrand. Their purpose is to ensure that all employees
within the organization andall external marketing partners understand what the brand most fundamentally
isto represent with consumers so that they can adjust their actions accordingly.
Brand mantras are powerful devices. They can provide guidance what ad
campaigns to run, where and how the brand should be sold and so on. Brandmantras can be broken down
into three terms brand functions, descriptivemodifier and emotional modifier. The brand functions
describe the nature of theproduct. The descriptive modifier is a way to circumscribe the business
functionsterm to further clarify its nature. Finally emotional modifier provides anotherqualifier in terms
of how the brand delivers these benefits. For example Nike

brand function is performance, descriptive modifier is athletic and emotional

modifier is authentic.
Chapter No. 4
Criteria for Choosing Brand Elements
There are six criteria in choosing brand elements which are as follows:
 Memorability
 Meaningfulness
 Likeability
 Transferability
 Adaptability
 Protect ability
Memorability
A necessary condition for building brand equity is achieving a high level of brandawareness. There are
certain names, symbols, logos and visual properties thatmake a brand more attention getting and easy to
remember and thus contributeto brand equity. In other words brand name should be such which is
easilyrecalled and recognized.
Meaningfulness
Brand elements can also be chosen whose inherent meaning enhances theformation of brand associations.
Two particularly important dimension of themeaning of a brand element are the extent to which it
conveys the following:
General information about the nature of the product category In terms ofdescriptive meaning, to what
extent does the brand element suggest somethingabout the product category?
Specific information about particular attributes and benefits of the brand in termsof persuasive meaning,
to what extent does the brand element suggestsomething about the products
Likeability
Brand elements can be chosen that are rich in visual and verbal imagery andinherently fun and interesting.
In terms of first three criteria, a memorable,meaningful, and likable set of brand elements offers many
advantages. Becauseconsumers often do not examine much information in making product decisions,it is
often desirable that brand elements be easily recognized and recalled andinherently descriptive and
persuasive.

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Transferability
It is the fourth general criterion concerns the transferability of the brand elementin both a product
category and geographic sense. First, to what extent can thebrand element ad to the brand equity of new
products sharing the brandelements introduced either within the product class. Second to what extent
doesthe brand element add to brand equity across geographic boundaries and marketsegments.
Adaptability
It is the fifth general criterion concerns the adaptability of the brand element. Dueto changes in customer
values and opinions brand elements often must beupdated over time. The more adaptable and flexible the
brand element, theeasier it is to update it.
Protect ability
The final criterion concerns the Protect ability of the brand element both in legaland competitive sense.
Because suspicious persons ask sometimes detail aboutthe product before purchase. So manufacturers
must legally protect theirproducts by registered their patents.
Five B’s from the Customer Perspective:
1.Basic: There are some basic things which are required by customers.
2.Background: Customers have background when they are going to
purchase.
3.Beaut y: Packaging should be such that attract customers.
4.Belief: Customer should be belief on the brand.
5.Benefit: Customers purchase those things which give them benefit.
Five B’s from Brand Manager Perspective:
1.Brave: He should be bold in respect of taking initiatives.
2.Brilliant: He should be adept in designing better brand strategies.
3.Backing: Company should support him in sensitive situations.
4.Bridge: He is a person that creates a link between customers and
company and works as a bridge.
5.Beneficial: He should provide benefit to his company in which he is
working.
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Options and Tactics for Brand Elements
A good brand name should

 Be protected (or at least protect able) under trademark law

 Be easy to pronounce

 Be easy to remember

 Be easy to recognize

 Be easy to translate into all languages in the markets where the brand will
be used
 Attract attention
 Suggest product benefits (e.g.: Easy-Off) or suggest usage (note the
tradeoff with strong trademark protection)

 Suggest the company or product image

 Distinguish the product's positioning relative to the competition.

 Be super attractive

 Stand out among a group of other brands < like that one compared to the
others
Brand Names
The brand name is fundamentally very much important. It can be a key tosuccess in the market.
Sometimes brand name becomes so closely tied to theproduct in the minds of the consumers, however, it
is very much difficult thatbrand element for marketers to subsequently change. Consequently brandnames
are often systematically researched before being chosen

Brand Awareness
Brand awareness improved the extent to which brand names are chosen that aresimple and easy to
pronounce. To enhance brand recall, it is desirable for thebrand name to be simple and easy to pronounce.
Pronunciation also affects thewillingness of consumers to order the brand orally. Ideally, the brand
nameshould have a clear, understandable and unambiguous pronunciation andmeaning. The way a brand
is pronounced can affect its meaning.

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2.Quality must be reflected in every company activity.
3.Quality requires total employee commitment.
4.Quality requires high quality partners.
5.Quality improvement sometimes requires quantum leaps.
6.Quality does not always does not always cost more.
7.Quality is necessary but may not be sufficient.
8.A quality drive cannot save a poor product.
Relationship Marketing
Relationship marketing attempts to provide a more holistic, personalized brandexperience to create
stronger consumer ties. Relationship marketing is based onthe premise that current customers are the key
to long term brand success. Theimportance of customer retention can be seen by some of the benefits
it provides:
 Acquire new customers can cost five times more than the costs involved in
satisfying and retaining current customers.
 The average company loses ten percent of its customers each year.
 A five percent reduction in the customer defection rate can increase profits
by twenty five percent to eighty five percent, depending on the industry.
 The customer profit rate tends to increase over the life of the retained
customer.
Loyalty Programs
Loyalty programs have become one popular means by which marketers cancreate stronger ties to
customers. There are some tips for building effectiveloyalty programs follow:

 Know your audience

 Change is good

 Listen to your best customers

 Engage people
Pricing Strategy

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The pricing strategy can dictate how consumers categorize the price of the brandand how firm set that
price. Consumers may infer the quality of a product on thebasis of its price. Many marketers have adopted
value-based pricing strategiesattempting to sell the right product at the right price to better meet
consumerwishes. From a branding perspective, it is important to understand all priceperceptions that
consumers have for a brand.
Setting Prices to Build Brand Equity
There are many different approaches to setting prices that depend on a numberof considerations. Many
firms now are employing a value-pricing approach to setprices and an everyday-low pricing approach to
determine their discount pricingpolicy over time.
Value Pricing
The objective of value pricing is to uncover the right blend of product quality,product costs, and product
prices that fully satisfies the needs and wants ofconsumers and the profit targets of the firm. Several firms
have beensuccessfully by adopting a value-pricing strategy. For instance, Wal-Mart’sslogan “we sell for
less” describes the pricing strategy that has allowed them tobecome the world’s largest retailer. In
general, an effective value-pricing strategyshould strike the proper balance among the following:

 Product design and delivery

 Product costs

 Product prices
Product Design and Delivery
The first key is the proper design and delivery of the product. Product value canbe enhanced through
many types of well-conceived and executed marketingprograms. The value pricing point out that the
concept does not mean selling theproduct at lower prices. Consumers are willing to pay premium when
theyperceive added value in products and services. Some companies actually havebeen able to increase
prices in some cases by introducing new products. Forinstance when Gillette introduced the Mach III, it
priced the cartridges at a fiftypercent premium over its then-priciest blade, despite the prevailing
deflationaryclimate. The price increase did not deter customers, and Gillette reached itshighest market
share, seventy one percent in 1962.
Product Costs
The secondary key to a successful value-pricing strategy is to lower costs as
much as possible. Meeting cost targets invariably requires additional cost

17
savings through productivity gains, outsourcing, material substitution, productreformulations, process
changes and so on. For example, by investing in efficientmanufacturing technology, Sara Lee was able to
maintain adequate margins foryears on its L’ eggs women’s hosiery with minimal price increases.
Thecombination of low prices and the strong L’eggs brand image resulted in analmost fifty percent
market share. At the same time, cost reductions cannotsacrifice quality.
Product Prices
The price suggested by estimating perceived value can often be used as astarting point in determining
actual marketplace prices, adjusting by cost andcompetitive considerations as necessary. For example,
General Motor’s Cadillacdivision has used target pricing to arrive at the price of its luxury cars.
GMmarketers determined the optimal price based on assumptions about theconsumer and then figured out
how to make the car at the right cost to ensurethe necessary profit.
Channel Strategy
The manner by which a product is sold can have a profound impact on theresulting equity and ultimate
sales success of a brand. Marketing channels aresets of interdependent organizations involved in the
process of making a productor service available for use.
Channel Design
A number of possible channel types and arrangements exist. Broadly, they canbe classified into direct and
indirect channels. Direct channels involve sellingthrough personal contacts from the company to
prospective customers by mail,phone, electronic means, in-person visits, and so forth. Indirect channels
involveselling through third party intermediaries such as agents, wholesales and retailers.
Indirect Channels
Indirect channels consist of a number of different types of intermediaries.Retailers tend to have the most
visible and direct contact with customers andtherefore have the greatest opportunity to affect brand
equity.
Push and Pull Strategies
When manufacturers regain some of their lost power by creating strong brandthrough some of the brand
building tactics, for example, by selling innovative andunique products at properly priced and advertised
that consumers demand for it.In this way consumer may ask retailers to stock and promote manufacturers
18
products. By devoting marketing efforts to the end consumer, a manufacturer issaid to employee a pull
strategy. On the other side when marketers devote theirselling efforts to the channel members by
providing direct incentives for stock tothem and sell products to the end customer. This approach is called
pushstrategy. In pull strategy marketers use advertisement and sales promotion but inpush strategy they
use trade discounts and personal selling.
Direct Channels
To gain control over the selling process and build stronger relationships withcustomers, some
manufacturers are introducing their own retail outlets, as wellas selling their product directly to customers
through various means. Thesechannels can take many forms. The most extensive form involves company-
owned stores. Hallmark, Goodyear and others have sold their own products intheir own stores for years.

21
coupons, premiums, refunds and rebates, contests and sweepstakes, bonuspacks and price-offs. Sampling
is seen as a means of creating strong relevantbrand associations.
Event Marketing and Sponsorship
Event marketing refers to public sponsorship of events. Event sponsorshipprovides a different kind of
communication option for marketers. Marketers reporta number of reasons whey they sponsor events
•
To identify with a particular target market
•
To increase awareness of the company
•
To create consumer perceptions of key brand image associations
•
To enhance corporate image dimensions
•
To create experiences and evoke feelings
•
To express commitment to the community
•
To entertain key clients
•
To permit merchandising opportunities
Public Relations and Publicity
Public relations and publicity relate to a variety of programs and are designed topromote a company‘s
image and its products. Publicity refers to non-personalcommunications such as press releases, media
interviews, press conferences,feature articles, newsletters, photographs, films and tapes. Public relations
mayalso involve such things as annual reports, fund-raising and membership drives,lobbying, special
event management, and public affairs.
There are three steps for designing an ad. It is also known as3M:
1.Model: A person who works as an ambassador of a product and convey
its benefits to target consumers.
2.Message: The objective of an ad which a company is intended to deliver
to target customers.
3.Masses: The target customers/market for whom an ad is designed.
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Developing Integrated Marketing Communication Programs
Matching Communication Options
There are many ways to create integrated marketing communication programs.In assessing the collective
impact of an IMC program, the goal is to create themost effective and efficient communication program
possible. Toward that goal,six relevant criteria can be identified:
1. Coverage
2. Contribution
3. Commonality
4. Complementary
5. Versatility
6. Cost
Coverage
Coverage relates to the proportion of the audience that is reached by eachcommunication option
employed, as well as how much overlap exists amongcommunication options. The unique aspect of
coverage relates to the inherentcommunication ability of a marketing communication option, as suggested
by thesecond criterion. To what extent that there is some overlap in communicationoptions.
Contribution
Contribution relates to the inherent ability of a marketing communication to createthe desired response
and communication effects from consumer in the absenceof exposure to any other communication option.
In other words, contributionrelates to the main effects of marketing communication option on the
targetaudience.
Commonality
Marketing communication program should be coordinated to create a consistent
and cohesive brand image in which brand association share content and

23
meaning. Commonality means each and every communication option which a
marketers use should convey a common associations about the product.
Complementary
Complementary relates to the extent to which different associations and linkagesare emphasized across
communication options. For instance, research showsthat promotion can be more effective when
combined with advertising.
Versatility
Versatility refers to the extent that a marketing communication option is robustand effective for different
groups of consumers. There are two types of versatility:communication and consumer. The ability of a
marketing communication to workat two levels effectively communicating to consumers who have or
have not seenother communications is critically important.
Cost
Finally evaluating the each communication option is also very much critical for amarketer. The cost of
each communication option varies in the market. Now theproblem is which communication option should
be chosen and which is best.Communication options vary in terms of their breadth and depth of coverage.
Toselect one communication option the marketer has to trade off the other.
26
 Growth potential: What are the growth potential for the brand and the
industry in which it operates?
 Risk profile: what is the risk profile for the brand? How vulnerable is the
brand likely to be to those facilitating and inhibiting factors?
 Brand contribution: How important is the brand as part of the firm’s
brand portfolio and all the brands it has?
Shareholder Value
Based on all available current and forecasted information about a brand as wellas many other
considerations, the financial marketplace then formulates opinionsand makes various assessments that
have direct financial implications for thebrand value. Three particularly important indicators are the stock
price, the priceearnings multiple, and overall market capitalization for the firm.
Designing Brand Tracking Studies
Tracking studies involve collection of information from customers on a routinebasis over time. Tracking
studies are a means of applying the brand value chainto understand where, how much, and in what ways
brand value is being created,thus offering invaluable information about how well a positioning has
beenachieved. Tracking studies play an important function for managers to facilitatetheir day to day
decision making. Tracking studies provide valuable diagnosticinsights into the collective effects of a host
of marketing activities on thecustomer mindset, marketing outcomes, and perhaps even shareholder value.
What to Track
This section provides some general guidelines for tracking. The tracking study isnecessary to customize
tracking surveys to address the specific issues faced bythe brand.
Product Brand Tracking
Tracking an individual branded product involves measuring brand awareness andimage for the particular
brand. Awareness measures should move from moregeneral to more specific questions. A range o more
general to more specificmeasures be employed in brand tracking surveys to measure brand
image,especially in terms of specific perceptions and evaluations. It is also important tomeasure all
association that may distinguish competing brands. Brandassociations should include all potential sources
of brand equity. At the sametime it is also important to track more general, higher level judgments,
feelings,and other outcome related measures.
When and Where to Track

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Tracking studies in general depends upon the frequency of product purchase andon consumer behavior
and marketing activity in the product category. One usefultracking approach for monitoring brand
associations involves continuous trackingstudies in which information is collected on continuous basis
over time. When thebrand has more stable associations, tracking can be conducted on a lessfrequent basis.
How to Interpret Tracking Studies
Tracking measures must be reliable and sensitive as possible. One problem withmany traditional
measures is that they do not change much over time. In this waythey reflect the fact. Marketers must
identify the real value drivers for a brand thatis, those tangible and intangible points of difference that
influence and determineconsumers’ product and brand choices.
Establishing a Brand Equity Management System
A brand equity management system is a set of organizational processesdesigned to improve the
understanding and use of the brand equity conceptwithin a firm. Three major steps an organization should
take to implement abrand equity management system: creating brand equity charters, assemblingbrand
equity reports, and defining brand equity responsibilities.
Brand Equity Charter
The brand equity charter provides relevant guidelines to marketing managerswithin the company as well
as key marketing partners outside the company. Thisdocument should do the following:
 Define the firm’s view of the brand equity concept and explain why it is
important
 Describe the scope of key brands in terms of associated products and the
manner by which they have branded and marketed.
 Specify what the actual and desired equity is for brand at all relevant
levels of the brand hierarchy at both the corporate level and at the
individual product level.
 Explain how brand equity is measured in terms of the tracking study and
the resulting brand equity report.
 Suggest how brand equity should be managed in terms of some general
strategic guidelines.
 Specify the proper treatment of the brand in terms of trademark usage,
packaging and communication.
 Outline how marketing programs should be devised in terms of some
specific tactical guidelines.

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Brand equity charter may not change from year to year. As new products areintroduced, brand programs
are changed, and other marketing initiatives takeplace.
Brand Equity Reports
Brand equity report is distributed to management on a regular basis. The brandequity report should
provide descriptive information as to what is happening witha brand as well as diagnostic why it is
happening. One section of the reportshould summarize consumers’ perceptions of key attributes,
preferences andreported behavior as revealed by the tracking study. Another section of the reportshould
include more descriptive market level information such as the following:
 Product shipments and movement through channels of distribution
 Relevant cost breakdowns
 Price and discount schedules where appropriate
 Sales and market share information broken down by relevant factors.
 Profitassessments
Brand equity is an intangible asset that depends on associations made by the
consumer. There are at least three perspectives from which to view brand equity
Financial - One way to measure brand equity is to determine the price premium
that a brand commands over a generic product. For example, if consumers arewilling to pay $100 more
for a branded television over the same unbrandedtelevision, this premium provides important information
about the value of thebrand. However, expenses such as promotional costs must be taken into
accountwhen using this method to measure brand equity.
Brand extensions - A successful brand can be used as a platform to launch
related products. The benefits of brand extensions are the leveraging of existingbrand awareness thus
reducing advertising expenditures, and a lower risk fromthe perspective of the consumer. Furthermore,
appropriate brand extensions canenhance the core brand. However, the value of brand extensions is more
difficultto quantify than are direct financial measures of brand equity.
Consumer-based - A strong brand increases the consumer's attitude strength
toward the product associated with the brand. Attitude strength is built byexperience with a product. This
importance of actual experience by the customerimplies that trial samples are more effective than
advertising in the early stagesof building a strong brand. The consumer's awareness and associations lead
toperceived quality, inferred attributes, and eventually, brand loyalty
Brand Equity Responsibilities

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To develop a brand equity management system that will maximize long termbrand equity organizational
responsibilities and process with respect to the brandmust be clearly defined. This section considers
internal issues related toassigning responsibilities and duties for properly managing brand equity.
Theremust be a chief brand officer in every organization who reports directly to thechief executive officer
of the company and who protect the brand –the way itlooks and feels. The chief brand officer recognizes
that the brand is the sum totalof everything a company does. He should not only help to build the brand
butalso plans, anticipates, researches, probes, listens, and informs.

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Chapter No. 10
Comparative Methods
Comparative methods involve experiments that examine consumer attitudes andbehaviors toward a brand
directly estimate the benefits arising from having a highlevel of awareness and strong, favorable, and
unique brand associations. Thereare two types of comparative methods.
 Brand-based Comparative Approach
 Marketing-based Comparative Approach
Brand-based Comparative Approach
Brand-based comparative approaches examine consumer response based onchanges in brand
identification. These measurement approaches typicallyemploy experiments in which one group of
consumers responds to questionsabout the product in its marketing program when it is attributed to the
brand andother groups respond to question asked about the same brand. Comparing theresponses of the
two groups provide some useful insights into the equity of thebrand. Consumer responses may be based
on beliefs, attitudes, intentions, andactual behavior.
Marketing-based Comparative Approach
Marketing-based comparative approaches hold the brand fixed and examineconsumer response based on
changes in the marketing program. Marketing-based comparative approaches can be applied in other
ways. Consumerresponds to different advertising strategies and executions.
Holistic Methods
Holistic methods attempt to place an overall value on the brand in either abstractutility term. Thus holistic
methods attempt to net out various considerations todetermine the unique contribution of the brand. The
residual approach attemptsto examine the value of the brand by subtracting consumer’s preferences for
thebrand based on physical product attributes alone from their overall brandpreferences. The valuation
approach attempts to place a financial value on brandequity for accounting purposes, mergers and
acquisitions.

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Chapter No. 11
The Brand Product Matrix
The brand product matrix is a geographical representation of all the brands andproducts sold by the firm.
The rows of the matrix represent brand productrelationships and capture the brand extension strategy of
the firm in terms of thenumber and nature of products sold under the firm’s brands. A brand lineconsists
of all products original as well as line and category extensions soldunder a particular brand. The columns
of the matrix represent product brandrelationships and capture the brand portfolio strategy in terms of the
number andnature o brands to be marketed in each category. The brand portfolio is the set ofall brands
and brand lines that a particular firm offers for sale to buyers in aparticular category.
Breadth of a Branding Strategy
The breadth of a branding strategy concerns the number and nature of differentproducts linked to the
brands sold by a firm. There are some steps which can beused to measure include aggregate market
factors, category factors, andenvironmental factors.
Aggregate Market Factors
Aggregate market factors include the market size, market growth, stage in
product life cycle, sales cycle, seasonality and profits.
Category Factors
Category factor is considered attractive if it is the case that the threat of newentrants is low due to the
barriers of entry from economies of scale, bargainingpower of buyers is low e.g. when the product bought
is a small percentage ofbuyers costs, current category rivalry is low when there are few competitors infast
growing markets and few close product substitutes exist in the eyes ofconsumers and the market is
operating at near capacity.
Environmental Factors
External forces unrelated to the product’s customers and competitors that affectmarketing strategies. A
host of technological, political, economic, regulatory, andsocial factors will affect the future prospects of
a category and should be forecasted.

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Depth of a Branding Strategy
The depth of a branding strategy concerns the number and nature of differentbrands marketed in the
product class sold by a firm. For example Procter &Gamble is widely recognized as popularizing the
practice. P&G becameproponents of multiple brands after recognizing that introducing its new
detergentbrand as an alternative to its already successful tide detergent resulted in highercombined
product category sales.
Brand Hierarchy
A brand hierarchy is a means of summarizing the branding strategy by displayingthe number and nature
of common and distinctive brand elements across thefirm’s products. A brand hierarchy is a useful means
of graphically portraying afirm’s branding strategy. The highest level of the hierarchy technically
alwaysinvolves one brand the corporate brand. For some firms the corporate brand isvirtually the only
brand used e.g. as with General Motors and Hewlett-Packard.At the next lower level, a family brand is
defined as a brand that is used in morethan one product category but is not necessarily the name of the
company itself.An individual brand is defined as a brand that has been restricted to essentiallyone product
category, although it may be used for several different product typeswithin the category. For example
General Motor is a corporate brand, underGeneral Motor Chevrolet, Pontiac, Oldsmobile, Buick, Cadillac
and GMC arefamily brands. Under these brands there are an individual brands like Alero,regal, cutlass,
sun fire etc.
Corporate brand equity is the differential response byconsumers, customers,employees, other firms or any
relevant constituency to the words, actions,communications, products or services provided by an
identified corporate brandentity.
Corporate Image
Corporate image plays very much important role in any brand strategy. There are
some important corporate image associations which are as follows:
Common Product Attributes, Benefits
A high quality corporate image association involves the creation of consumerperceptions that a company
makes products of the highest quality. A number ofdifferent organizations rate products and companies
on the basis of quality. Aninnovative corporate image association involves the creation of
consumerperceptions of a company as developing new and unique marketing programs,especially with
respect to product introductions. Being innovative is seen in partas being modern and up to date investing
in research and developing employingthe most advanced manufacturing capabilities and introducing the
newest

product features. Perceived innovativeness is also a key competitive weapon and

priority for firms in other countries.
People and Relationships
Corporate image associations may reflect characteristics of the employees of thecompany. Thus a
customer focused corporate image association involves thecreation of consumer perceptions of a
company as being responsive to andcaring about its customers. A company seen as customer focused is
likely to bedescribed as listening to customers and having their best interests in mind.
Values and Programs
Corporate image associations may reflect values and programs of the companythat do not always directly
relate to the products they sell. Firms can runcorporate image ad campaign as a means to describe to
consumers, employees,and others the philosophy and actions of the company with respect
toorganizational, social and political issues.
Corporate Credibility
Corporate credibility depends upon three factors:
1.Corporate expertise: The extent to which a company is seen as able to
competently make and sell its products or services.
2.Corporate trustworthiness: The extent to which a company is seen as
motivated to be honest, dependable and sensitive to customer needs.
3.Corporate likeability: The extent to which a company is seen as likable,
attractive, prestigious, dynamic and so forth.
Designing a Branding Strategy
Before designing a branding strategy if a firm does not identify its weaknesses inthe research, might be it
has negative effect on customers. When a firm’s productcannot satisfy the needs of the consumers they
never purchase it again and as aresult they have negative relationship with the product and in future might
be theynever purchase of any product of that company on the basis of previous experience.
Combining Brand Elements from Different Levels
If multiple brand elements from different levels of the brand hierarchy are
combined to brand new products, it is necessary to decide how much emphasis

should be given to each brand element. For example if a sub-brand strategy isadopted, how much
prominence should individual brands be given at theexpense of the corporate brand? There are many
different ways to connect abrand element to multiple products. The principle of commonality states that
themore common brand elements shared by products, the stronger the linkagesbetween the products. The
simplest way to link products is to use the brandelement as is across the different products involved. For
example, a commonprefix of a brand name may be adapted to different products. Hewlett-
Packardcapitalized on its highly successful Laser Jet computer printers to introduce anumber of new
products using the “Jet” prefix, for example, the DeskJet, PaintJet, Think Jet, and Office Jet printers.
Corporate Image Campaigns
To maximize the probability of success, however, the objective of a corporateimage campaigns must be
clearly defined and results must be carefullymeasured against these objectives. A number of different
objectives are possiblein a corporate brand campaigns.

 Build awareness of the company and the nature of its business

 Create favorable attitude and perception of company credibility

 Link beliefs that can be leveraged by product specific marketing

 Make a favorable impression on the financial community

 Motivate present employees and attract better recruits

 Influence public opinion on issues

New Products and Brand Extensions
For any company new products and brand extensions are vital and play verymuch important role in the
growth of the company. It entirely depends on thesituation and the time where they should be induction of
a new brand or to extentthe existing brand. When a company introduces a new product, it has three
mainchoices as to how to brand it:
1.It can develop a new brand, individually chosen for the new product.
2.It can apply, in some way, one of its existing brands.
3.It can use a combination of a new brand with an existing brand.
Managing Multiple Brands
 Different companies have opted for different brand strategies for
multiple products. These strategies are:
 Single brand identity - a separate brand for each product. For
example, in laundry detergents Procter & Gamble offers uniquely
positioned brands such as Tide, Cheer, Bold, etc.
 Umbrella - all products under the same brand. For example, Sony
offers many different product categories under its brand.
  Multi-brand categories - Different brands for different product
categories. Campbell Soup Company uses Campbell's for soups,
Pepperidge Farm for baked goods, and V8 for juices.
 Family of names - Different brands having a common name stem.
Nestle uses Nescafe, Nesquik, and Nestea for beverages.
A brand extension is when a firm uses an established brand name to introduce
a new product. An existing brand that gives birth to a brand extension is referred
to as the parent brand. There are seven general strategies for establishing a
category extension:
1.Introduce the same product in a different for. For example, Haleeb Dairy
Queen
2.Introduce products that contain the brand’s distinctive taste, ingredient, or
component. For example, Cornetto Ice Cream
3.Introduce companion products for the brand. For example, McDonald
offers free Pepsi with its fast food.
4.Introduce product that relevant to the customer franchise of the brand. For
example, Mobilink Black berry.
5.Introduce products that capitalize on the firm’s perceived expertise. For
example, Sony TV

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6.Introduce products that reflect the brand’s distinctive benefit, attribute. For
example, Safeguard.
7.Introduce products that capitalize on the distinctive image or prestige of
the brand. For example, Coca Cola
Advantages of Brand Extensions
There are different advantages of brand extension for a company. Some of them
are as follows:
What is a brand extension?It’s simply a
manner of leveraging the success and popularityof an existing brand name to support the launchof a new
product.For example,Nike started out
selling shoes and later extended the brand intodifferent types of
shoes (i.e., line extensions) and different product categories likeclothing (i.e., category extensions).As a
businessperson and marketer, it’simportant to understand the reasons why extending your brand can help
yourcompany.
Kellogg on Branding includes a great chapter about brand extensions from
which I extracted the following top 5 reasons to extend brand:
1) Brand extensions can reduce the costs and risks associated withlaunching a new product.Since the brand
name is already known and(hopefully) popular, using that brand name on a new product
 (particularlywhen it’s in the same line as the original product) immediatelycommunicates the same level
of awareness and perception.
2)Brand extensions typically garner more shelf space than unknown newproduct brands.Simply stated,
retailers are more likely to stock a newproduct with a known brand name on it.Again, it’s less risky, and
afamiliar brand comes with ready-made awareness and perceptions.
3) Brand extensions may require a lower advertising investment.Consumers are already aware of the brand
name, so advertising to createbrand awareness and recognition is not necessary.Instead, advertisingdollars
can be invested in more targeted messaging.
4)Brand extensions can boost the parent brand by creating increasedinterest in the brand as a whole and
possibly growing the brand’scustomer base across the board.
5) Brand extensions reduce a company’s dependency on one product
which could become less popular in the future
Facilitate New Product Acceptance
 Improve brand image

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 Reduce risk perceived by customers
 Increase the probability of gaining distribution and trial
 Increase efficiency of promotional expenditures
 Reduce cost of introductory and follow up marketing programs
 Avoid cost of developing a new brand
 Allow for packaging and labeling efficiencies
 Permit consumer variety seeking
Provide Feedback Benefits to the Parent Brand and Company
 Clarify brand meaning
 Enhance the parent brand image
 Bring new customers into brand franchise and increase market coverage
 Revitalize the brand
 Permit subsequent extensions
Disadvantages of Brand Extensions
 Can confuse customers
 Can encounter retailer resistance
 Can fail and hurt parent brand image
 Can succeed but cannibalize sales of parent brand
 Can succeed but diminish identification with any one category
 Can succeed but hurt the image of parent brand
 Can dilute brand meaning
 Can cause the company to forgo the chance to develop a new brand.
Evaluating Brand Extension Opportunities
1. Define actual and desired consumer knowledge about the brand.
2. Identify possible extension of brand on the basis of parent brand
associations and overall similarity.
3. Evaluate the potential of extension brand to create equity according to the
three factor model:

Salience of parent brand associations

Favorability of inferred extension associations

Uniqueness of inferred extension associations
4. Evaluate extension feedback effects according to the four factor model:

How compelling the extension evidence is

How relevant the extension evidence is

How consistent the extension evidence is

How strong the extension evidence is

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5. Consider possible competitive advantages as perceived by consumers
and possible reactions initiated by consumers.
6. Design marketing campaign to launch extension
7. Evaluate extension success and effects on parent brand equity