1nd Edition Bus M300 Lecture 12 Outline of Current Lecture I Why is brand important II Brand III Brand Loyalty IV Brand Extensions V Product Line Extensions Current Lecture I Why is brand important a Brand is responsible for 18 of total purchase decision b Strong vs weak brands can charge 19 higher c Stronger brands drove 9 5 points higher shareholder return II Brand a Brand is more than just advertising and marketing It s nothing less than everything one thinks when they see your logo or hear your name b Brand definition Name symbol or design used to identify the products and differentiate them from competitive offerings c Brand name the words or letters of the brands d Brand mark pictorial part of the brand e Trademark legally protected brand exclusive to the owner f Brand equity The added value to the firm the channel or the consumer with which a brand endows a product These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute i High brand equity has a high degree of preference and insistence ii In other words incremental value the brand itself produces III Brand Loyalty a Brand recognition knowledge of brand i How can a firm increase brand recognition 1 Advertising promotion trial etc 2 Goal is to get the brand in front of their eyes b Brand preference prefers one brand over another but will not demand that brand every time i How can they increase this 1 Persuade convince people you are better c Brand insistence No alternatives will suffice Few goods reach this stage i How can they increase this 1 Loyalty programs airlines Having a superior product Superior service 2 Example Some people DEMAND Coke vs Pepsi d 3 stages Recognition Preference Insistence IV Brand Extensions a High brand equity can lead to brand extensions to maximize value b Brand extension new products in different product category c Successful brand extensions i Product categories must fit ii Characteristics must fit iii What the product stands for must fit iv Quality of extension V Product Line Extensions a Product line extension PLE new products that closely resemble the firms existing product b Stay within the same category but extend product c Example MacBook pro mac air Coke Coke Zero d Why offer PLE i PLE can enhance firm growth Mature to growth ii PLE allow for more optimal uses of company resources e Differences between PLE and Brand extension i PLE Starwars sequels ii Brand extension Action figures for Starwars
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