Written summary of lesson 7, Consumer Behaviour (Prof De Langhe). All lesson information, slides, graphs...
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Written summary of session 7, Consumer Behaviour (Prof De Langhe). All information from the l...
Session 7 (17 Nov): Customer-based brand equity – part 3
Laddering = ‘brand has laddered up’: connecting this specific bundle of attributes to higher-
order benefits (experiential, social, emotional, symbolic….)
→ strong brands/brands that are valuable: have laddered up from the specific attributes that
they’re offering to those higher-order attributes
→ Strong brands have built associations with higher-order benefits in consumer’s minds
= Laddering
Examples of laddering:
- Fiat: product-related attribute = color of the car
- New Coke: Coca-Cola launched new taste
the new coke violated the higher order benefits and triggered the major backlash
→ laddering is a critical part of branding
Renova:
= Portuguese manufacture of toilet paper
Two types of consumers:
1. The retailers (competitor)
Need to convince the shop to carry your product
2. The end-consumer
Buys and uses the product
→ influencing these two types of consumers requires different strategies!
Product category is boring….
, In Portugal: Renova is quite large
Western Europe: very small player
Worldwide: even smaller
→ company is wedged by two types of competitors
1. Private labels (huismerk):
Consumer + competitor at the same time
2. Multinational players
The power of retailers:
- Only trademark that recurs throughout the store (in different places in the store)
- They have control over competitive landscape and point of sale
o Guaranteed good shelf placement
- In a zero-sum world, increasing sales for manufacture brand implies decreasing sales
for private label
o Customer = competitor
→ private labels are increasingly powerful!
Renova is a small company that is trying to compete on the one hand with the big
multinationals and on the other hand with retailers:
1. Reduce price and directly
compete with private labels
2. Collaborate with retailers and
produce products for them
3. Keep on innovating
What do you think they should be doing?
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