Topic 1 - Brand Management
Brand: name, term, sign, symbol, or design (or combination of them) intended to identify the goods
and services of one seller or group of sellers and to differentiate them from those of competition
→ Practice: a brand creates an amount of meaning, reputation, preference, etc. in the eyes of the customer
→ Louis Vuitton: communicates external value, signals perceived quality (intrinsic)
‘’Brands connected to products vs Brands’’ ‘’University vs TIlburg University, Laptop vs Apple
Laptop’’ → Products vs Brands
Product: anything that can be offered to a market for attention, acquisition, use, or consumption
that might satisfy a need or want (Kotler)
Four product levels (Levitt)
1. Core product: product as it is (pointer, pointer functionalities (different pages, laser, shape,
color)
2. Tangible product: includes core product (car, but Mercedes car), everything that you can
experiences with the senses you have
3. Augmented product: includes tangible aspects and core product; warranties, additional
services (selling the car, warranty of 7 years/100,000 km)
4. Total product: includes all three above levels; added value from the eyes of the customer
(where organization and customer meet)/customer’s benefits from buying the product
Brand management perspectives
→ Physical product: brand from the organizations’ POV (captures the core product)
→ Psychological product: brand from the customers’ POV (benefits for the customer based on the physical
product)
Inside-out (product-oriented) vs Outside-in
branding perspective
Physical vs Non-physical value of a brand
Exam question: Make a connection between Levitt’s theorizing on products, psychological vs
physical product perspective, inside-out vs outside-in
→ Inside-out perspective is the product (first three of Levitt’s)
→ Psychological perspective deals with outer layer, what the customer has made of it (outside-in
perspective)
Taste (intrinsic product) is not most important aspect in buying beverages → Coca Cola’s brand
value is much higher than Pepsi’s
,Product Brand
Tangible (can be touched by the customer) Intangible (lives in customer’s mind)
Can be copied Unique
Can be outdated Potentially timeless
Involves transactions Forms basis of connections
Brand: a product, but one that adds other dimensions that differentiate it in some way from other
products designed to satisfy the same need
→ Valued differences:
→ Rational and tangible
→ Symbolic, emotional and intangible
Products → Brands
Differentiation → Relevance
Attributes → Personality
Promise → Relationship
Static → Dynamic
Mass → Individual
Awareness → Meaningfulness
Customer value: difference between what a customer gets from a product, and what he or she
needs to give to get (lens of the consumer)
→ Best service, Status, Less risk, Convenience, Time efficient, Authenticity, Bargain, Social belonging
Value proposition: promise of value to be delivered and acknowledged, and a belief from the
customer that value will be appealed and experienced (lens of the organization)
→ Can apply to an entire organization, or parts of it, customer accounts, products/services, or brands
Customer benefits
→ Functional benefits (efficiency, excellence)
→ Social benefits: (status, esteem)
→ Altruistic benefits (ethics, spirituality)
→ Emotional benefits (feelings, aesthetic)
AirBNB
→ Gains: benefits (cheap)
→ Pains : worries/costs (not knowing the kind of room)
→ Gain creators
→ Pain relievers (hassle with all the money going in and out, coverage guarantee)
Brand importance for consumers
→ Identification of source of the product
→ Assignment of responsibility to product maker
→ Risk reducer (different kinds of risk)
,→ Search cost reducer (heuristic, short-cut)
→ Bond/pact with maker of product (brand communities)
→ Symbolic device
→ Signal of quality
Dove campaign
→ Using models to elicit aspiration
Brand functions
→ Symbol: values, brand emotions, brand identity, image of users
→ Buying behavior: simplification (identification, repetition), safety (functional, social), risk reduction (trust,
service)
→ Relationship: community, support, psychological proximity, attachment, commitment
→ Product representation: functional, social, epistemological, aesthetic, hedonic, conditional, holistic
Brand importance for producers
→ Means of identification to simplify handling or tracing
→ Means of legally protecting unique features
→ Signal of quality level (Samsonite)
→ Means of endowing products with unique associations
→ Source of competitive advantage (barriers of entry)
→ Source of financial returns
Key to branding is that consumers perceive differences among brands in a product category / the
brand resides in the minds of consumers, so give a label (how to identify) and provide meaning
(what it does).
What can be branded:
1. Physical goods:
→ Fast moving packaged consumer goods: almost 100% of products are branded
→ Business-to-business products: creating a positive image and reputation for a company as a
whole (Boeing)
→ High-tech products: financial success no longer driven by product innovation or latest product
specifications and features alone (Intel)
2. Services:
→ Address potential intangibility and variability problem
→ Brand symbols to make abstract nature more concrete
3. Retailers and distributors: generate consumer interest, patronage and loyalty in a store and
consumers learn to expect certain brands and products from a store
→ Private label brands (AH, Tesco)
4. Online products and services: improving customer services because unique aspects of the
brand (convenience, price) are not enough (Google)
5. People and organizations (Elon Musk)
6. Sports, arts, and entertainment (experience goods (Walt Disney, Pixar))
7. Geographic locations ( Swedish furniture)
8. Ideas and causes
, Brand failures: some marketers failed to take into account the changing market conditions and
continued to operate with a business as usual attitude or were inappropriate in their response
Future of Brand Management
Brand challenges and opportunities
1. Savvy customers: difficulties in persuading more experienced customers with traditional
communications (to be ‘’respected’’ is not enough)
2. Brand proliferation: more complex brand families and portfolios, few ‘’mono’’ product
brands (should not destroy the parent brand)
3. Media fragmentation: (what are causes?)
→ Firms spend more on non-traditional and new forms of communication (interactive, electronic
media)
→ Increase expenditures on promotion, decrease expenditures on advertising (effectiveness; ad
agencies facing big problems nowadays)
4. Increased costs
→ New product introductions
→ Existing product support
5. Increased competition: more difficult to differentiate
→ Demand-side: mature markets
→ Supply-side: brand extensions/deregulation/globalization low-priced competitors (growth of
private labels and increasing trade power)
6. Greater accountability
→ Short-term performance orientation
→ Increasing job turnover
Customer-based brand equity (CBBE): differential effect that brand knowledge has on consumer
response to the marketing of that brand
→ A brand has positive customer-based brand equity when customers react more favorably (WTP) to a
product and the way it is marketed when the brand is identified than when it is not (when it is attributed to a
fictitiously named or unnamed version of the product)
Brand equity concept: stresses importance of the role of a brand in marketing strategies
→ Differences in outcomes arise from added value as a result of past marketing activities for the brand
→ This value can be created in many different ways
→ Brand equity provides common denominator for interpreting marketing strategies and assessing value of
a brand
→ Value can be manifested in different ways (greater proceeds and/or lower costs)
Brand management goals:
→ Consumer-based brand equity: build, sustain, and leverage positive, strong, active and unique meanings
of the brand
→ Financial-based brand equity: enable the brand to earn more in the short and long run
