978-0132664257 Chapter 15 Solution Manual

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Chapter 15

Closing Observations

Chapter Objectives

1. Understand the six future brand imperatives.

2. Identify the ten criteria for the brand report card.

3. Outline the seven deadly sins of brand management.

Overview

The nal chapter of the book summarizes the customer-based brand

equity framework; reviews guidelines for building, measuring, and

managing brand equity described in earlier chapters; then o’ers a

perspective on activities and attitudes that can help or hurt a brand.

A brand’s equity can be weakened by a failure to understand the full

range of associations consumers have for it, inadequate marketing

support, unwillingness to spend the time and/or money required to

build brand awareness and image, a lack of appreciation of the brand

equity concept within the corporation, or an inability to strike the

appropriate balance between maintaining consistency and

implementing change in marketing actions.

In order to maximize brand equity, rms must develop products that t

with a brand’s meaning and satisfy the needs and wants of consumers;

decide on the points of parity and points of di’erence that will result in

the best market position; provide superior delivery of benets;

maintain innovation in design, manufacturing, and marketing; be seen

as expert, trustworthy, and likable; communicate with a consistent

voice; employ a full range of complementary brand elements and

supporting marketing programs; and design and implement a brand

hierarchy and brand portfolio that establishes the optimal relationship

among the company’s o’erings.

Brand management issues related to industrial goods, high-technology

products, services, retailers, and small businesses are discussed. The

brand equity framework is compared to models developed by other

authors. The chapter and the book conclude by considering how

branding and branding principles might change over time.

Branding Brief 15-1 details the Brand Report Card. The Brand Report

Card evaluates a company’s brand management based on the

following criteria: managers understand what the brand means to

consumers; the brand is properly positioned; customers receive

superior delivery of the benets they value most; the brand takes

advantage of the full repertoire of branding and marketing activities

available to build brand equity; marketing and communications e’orts

are seamlessly integrated and the brand communicates with one voice;

the brand’s pricing strategy is based on consumer’s perceptions of

value; the brand uses appropriate imagery to support its personality;

the brand is innovative and relevant; for a multi-product, multi-brand

company, the brand hierarchy and brand portfolio are strategically

sound; the company has in place a system to monitor brand equity and

performance.

Brand Focus 15.0 considers specic applications of branding in

di’erent types of industries.

Branding Briefs

BRANDING BRIEF 15-1

THE BRAND REPORT CARD

The Brand Report Card can reveal how well a brand is being managed.

The brand is rated on a scale of 1 to 10 (1 = extremely poor; 10 =

extremely good) for each of the characteristics below:

Score

1. Managers understand what the brand means to consumers.

Have you created detailed, research-driven mental maps of your

target customers?

Have you attempted to dene a brand mantra?

Have you outlined customer-driven boundaries for brand

extensions and guidelines for marketing programs?

2. The brand is properly positioned.

Have you established category, competitive, and correlational

points-of-parity?

Have you established desirable, deliverable, and di’erentiated

points-of-di’erence?

3. Customers receive superior delivery of the bene#ts they

value most.

Have you attempted to uncover unmet consumer needs and

wants?

Do you relentlessly focus on maximizing your customers’ product

and service experiences?

4. The brand takes advantage of the full repertoire of branding

and marketing activities available to build brand equity.

Have you strategically chosen and designed your brand name,

logo, symbol, slogan packaging, signage, and other brand

elements to build brand awareness and image?

Have you implemented integrated push and pull strategies that

target intermediaries and end customers, respectively?

5. Marketing and communications e’orts are seamlessly

integrated (or as close to it as humanly possible). The brand

communicates with one voice.

Have you considered all the alternative ways to create brand

awareness and link brand associations?

Have you ensured that common meaning is contained

throughout your marketing communication program?

Have you capitalized on the unique capabilities of each

communication option?

Have you been careful to preserve important brand values in

your communications over time?

6. The brand’s pricing strategy is based on consumer

perceptions of value.

Have you estimated the added value perceived by customers?

Have you optimized price, cost, and quality to meet or exceed

consumer expectations?

7. The brand uses appropriate imagery to support its

personality.

Have you established credibility by ensuring that the brand and

the people behind it are seen as expert, trustworthy, and likable?

Have you established appropriate user and usage imagery?

Have you crafted the right brand personality?

8. The brand is innovative and relevant.

Have you invested in product and marketing improvements that

provide improved benets and better solutions for your

customers?

Have you stayed up-to-date and in touch with your customers?

9. For a multiproduct, multibrand company, the brand

architecture is strategically sound.

For the brand hierarchy, are associations at the highest levels

relevant to as many products as possible at the next lower levels,

and are brands well di’erentiated at any one level?

For the brand portfolio, do the brands maximize market coverage

while minimizing their overlap at the same time?

10. The company has in place a system to monitor brand

equity and performance.

Have you created a brand charter that denes the meaning and

equity of the brand and how it should be treated?

Do you conduct periodic brand audits to assess the health of

your brands and to set strategic direction?

Do you conduct routine tracking studies to evaluate current

marketing performance?

Do you regularly distribute brand equity reports that summarize

all brand-relevant research and information to assist marketing

decision making?

Have you assigned people within the organization the

responsibility of monitoring and preserving brand equity?

BRANDING BRIEF 15-2

REINVIGORATING BRANDING AT PROCTER & GAMBLE

Already the world’s largest consumer packaged goods company, P&G

became even larger with the $57 billion acquisition of Gillette in 2005.

After struggling brie=y at the turn of the twenty-rst century, the

company regained its reputation as the =ag-bearer of marketing

innovation and excellence.

Renewed Emphasis on R&D

In the rst decade of the twenty-rst century, one of the

fastest-growing major corporations in revenue and prot was Procter &

Gamble. Fueling its growth were successful new products such as

Swi’er mop, a battery-powered Crest Spin-Brush toothbrush, Mr. Clean

Magic Eraser, and Actonel. Many of these new products re=ected

innovation in “the core”—core markets, categories, brands,

technologies, and capabilities. To reinforce its innovation, P&G also

placed a renewed emphasis on design by appointing its rst-ever chief

design oEcer in 2001 and installing a top design oEcer in each of its

global business units. To more e’ectively grow its core, P&G also

adopted a “connect and develop” model that emphasized the pursuit

of outside innovation.

New Communication Approaches

P&G has been shifting its ad budget away from TV advertising and

toward “media-neutral” advertising, which determines media spending

without bias toward any particular medium based on precedent. In

place of big television buys, P&G has pioneered the use of less

obtrusive marketing techniques such as Vocalpoint, a word-of-mouth

marketing program that enlists 600,000 mothers, among others, to

promote its brands by giving positive testimonials, samples, and

coupons to friends and neighbors. P&G still values the power of TV ads,

but it also taps into the power of the Internet at the same time.

New Research Approaches

P&G conducts approximately 10,000 consumer research projects each

year, spending more than $100 million annually.

New Branding Philosophy

While it did launch successful new brands such as Swi’er, P&G began

pursuing a strategy with less inherent risk—leveraging existing assets

by investing in well-known “power brands.” The company now has 22

brands with more than $1 billion in annual sales and 19 with more than

$500 million. P&G went as far as resurrecting a brand and turning it

into a power brand with innovative new products. P&G often seeks to

leverage its power brands with vertical extensions into higher-margin

categories. P&G has broadened the meaning of its power brands in

more than just a product sense.

Brand Focus

BRAND FOCUS 15.0

SPECIAL APPLICATIONS

Online

Creating a brand online brings a special set of challenges. Many of the

guidelines for business-to-business, high-tech, retailing, and small

businesses identied below will apply.

Don’t forget the brand-building basics.

Create strong brand identity.

Generate strong consumer pull.

Selectively choose brand partnerships.

Maximize relationship marketing.

Industrial and Business-to-Business Products

Industrial goods and business-to-business marketing sometimes call for

di’erent branding practices.

Adopt a corporate or family branding strategy and create a

well-dened brand hierarchy.

Link non-product-related imagery associations.

Employ a full range of marketing communication options.

Leverage equity of other companies that are customers.

Segment customers carefully, and develop tailored branding and

marketing programs.

High-Tech Products

The distinguishing feature of high-tech products is that they change

rapidly over time because of innovations and R&D breakthroughs. The

short product life cycles for high-tech products have several signicant

branding implications.

Establish brand awareness and a rich brand image.

Create corporate credibility associations.

Leverage secondary associations of quality.

Avoid overbranding products.

Selectively introduce new products as new brands, and clearly

identify brand extensions.

Services

The level of sophistication in service branding has greatly increased in

recent years.

Maximize service quality by recognizing the myriad ways to

a’ect consumer service perceptions.

Employ a full range of brand elements to enhance brand recall

and signal more tangible aspects of the brand.

Create and communicate strong organizational associations.

Design communication programs that augment consumers’

service encounters and experiences.

Establish a brand hierarchy by creating distinct family brands or

individual brands as well as meaningful ingredient brands.

Retailers

Retailers and other channel intermediaries can a’ect the brand equity

of the products they sell, as well as create their own brand equity, by

establishing awareness and associations to their product assortment,

pricing and credit policy, and quality of service.

Create a brand hierarchy by branding the store as a whole, as

well as individual departments, classes of service, or any other

noteworthy aspects of the retail service or shopping experience.

Enhance manufacturer’s brand equity.

Establish brand equity at all levels of the brand hierarchy by

o’ering added value in the selection, purchase, or delivery of

product o’erings.

Create multichannel shopping experiences.

Avoid overbranding.

Small Businesses

Building brands is a challenge for small businesses because of their

limited resources and budgets. They usually do not have the luxury of

making mistakes and must design and implement marketing programs

much more carefully. Nevertheless, many entrepreneurs have built

their brands into powerhouses essentially from scratch. Because there

are usually limited resources behind a small-business brand, marketing

focus and consistency are critically important. Creativity is also

paramount for nding new ways to market ideas about products to

consumers.

Emphasize building one or two strong brands.

Focus the marketing program on one or two key associations.

Employ a well-integrated set of brand elements.

Design creative brand-building push campaigns and

consumer–involving pull campaigns that capture attention and

generate demand.

Leverage as many secondary associations as possible.

Discussion questions

1. What do you think makes a strong brand? Can you add any criteria

to the list provided?

2. Consider the deadly sins of brand management. Do you see

anything missing from the list of seven in Figure 15-8?

3. Pick one of the special applications and choose a representative

brand within that category. How well do the $ve guidelines apply?

Can you think of others not listed?

4. What do you see as the future of branding? How will the roles of

brands change? What di%erent strategies might emerge as to how

to build, measure, and manage brand equity in the coming years?

What do you see as the biggest challenges?

5. Consider the trade-o%s involved with achieving marketing balance.

Can you identify a company that has excelled in achieving balance

on various trade-o%s?

Exercises and assignments

Key take-away points

1. Brand management is an art and a science, and the purpose of the

text was to provide a number of concepts, tools, frameworks, etc.,

to help with the latter.

2. Strategic brand management includes the design and

implementation of marketing programs and activities to build,

measure, and manage brand equity.

3. Virtually all the branding concepts, tools, frameworks reviewed in

the book were relevant to any particular application. Nevertheless,

there are unique characteristics to any application that suggest

more specic guidelines.

4. The Brand Report Card or any comprehensive brand evaluation tool

is a good way to critique the brand management process.

5. The importance of branding seems unlikely to change for one

critical reason: Consumers will continue to value the functions

brands provide.