The Big Idea: a strong brand is one of the most important economic moats a company can build. Building a brand is not easy but, if done well, can pay dividends for many years.
Intro
- A brand is much like a reputation.
- A strong brand will reshape perception.
- Cash: Executives are pressured to focus on short-term financial results, however, brand building is a long-term project.
- Consistency: Brands are built at every touchpoint with the customer.
- Clutter: A strong brand needs to be focused and unique to stand out from the clutter.
1. Brand Positioning
- Develop a formal brand positioning statement to guide internal marketing managers.
- Once a brand is well-established, it is difficult to change.
- Who is this brand for?
- What does it help the customer accomplish?
- How is it different from the alternatives?
2. Designing Brands
- Begin with a strong brand concept.
- Incorporate specific cues into the design.
- The best technique for evaluation of brand design is to expose the design briefly and then ask consumers what they remember.
3. Brand Meaning
- A strong brand is differentiated from the competition in a meaningful way. Consumers are willing to pay a premium and to repeat purchases over time.
- Effective brand management involves the discovery, creation, and constant revision of stories.
- Brands can promote and proclaim brand affiliation (Harley Davidson, Apple.)
- Conduct a brand meaning audit to track and guide brand management efforts.
- Brand stewards must become astute meaning managers.
4. Competitive Brand Strategies
- The pioneer who creates, then dominates, a category enjoys a significant advantage for years and, sometimes, decades.
- Late entrants have three broad competitive strategies: fast-follower, differentiation, and innovation.
5. Brand Extensions
- A familiar brand name signals trust which can persuade consumers to try a new product launched with the brand name.
- The brand extension must make sense.
- Too many brand extensions can confuse consumers.
- Sub-brands are sometimes a better choice. Eg., Sony Walkman, where Sony is the parent brand and Walkman is the sub-brand.
6. Brand Portfolio Strategy
- Brands are a long-term asset.
- A company with many brands has two broad strategies: house of brands or branded house.
- House of brands: Proctor and Gamble, the brands are kept distinct and little effort is made to market the parent company to the consumer.
- Branded house: Apple, the parent company has a strong brand and the sub-brands are natural extensions of the parent brand.
7. Building Brands Through Effective Advertising
- Advertising should reflect the consumer’s aspirations.
- Advertising should resonate with prior beliefs, not try to change them.
- Advertising should resonate with existing goals.
- Some advertising strategies: hard sell (Visa and “we’re everywhere you want to be”), big idea (Delta stands for convenience because of X, Y, Z), story grammar (follow a character from problem to solution.)
- Keys: selecting the right media and the right timing.
8. Relationship Branding and CRM
- CRM can be used to build a personal connection with the brand.
- First, subsegment the market.
- Second, personalize the touch points to improve the customer experience.
- Segmentation methods: monetary value, sociodemographics, purchase behaviors.
- Cluster analysis is a statistical method used to find natural groups.
- Well-defined rewards (loyalty club benefits) generally work better than discretionary rewards (complimentary upgrades).
9. Brand Strategy for Business Markets
- Managing business brands presents unique challenges.
- The foundation of branding is positioning.
- A positioning statement declares who that target customer is, what you offer, and why it’s customers should prefer your offering.
- Brand equity is determined by the associations that are established in the customer’s mind with your brand.
- The brand associations can be functional (easy to use, high quality, affordable) or they can emotional (exciting, fun, trustworthy, exclusive.)
10. Services Branding
- A brand name is a promise made to the customer.
- Customers are either delighted, satisfied, or disgruntled.
- In contrast to goods, services are generally more intangible, complex, variable in their delivery, process-dependent.
- For services, the front-line employee (the primary touch point) is the brand.
- Since the front-line employee is the brand, marketing the brand internally is critical.
- Front-line employees must view their role as partners. Treat employees like part of the brand.
- Using self-service technology can reduce variation in customer experience. Service machines make remaining human employees even more valuable.
- Since the company is the brand, be careful to control communications of the company identity (from sponsored events to ethics to social media.)
- To manage and improve the customer experience, map all the touch points.
- Service blueprinting is a mapping of all the touch points with the customer.
- The blueprint will help identify bottlenecks, ensure consistency, and reveal opportunities to distinguish the brand from competitors.
- Ex. Mayo Clinic “patientfirst”.
- Be careful when selecting partners because they become an extension of the brand, for better or worse.
11. Branding in Technology Markets
- There has been a cultural bias in technology towards engineering and features and against branding.
- Technology firms need to learn from the CPG firms.
12. Building a Brand-Driven Organization
- The strongest, most resilient brands have a strong internal company culture that upholds the brand promises.
- A strong brand leads to customer loyalty, which leads to lower marketing costs, more repeat purchases, and a higher customer lifetime value.
- A strong brand leads to a higher willingness to pay, which leads to more revenue per customer, and a higher customer lifetime value.
- A strong company culture motivates employees, reduces employee turnover, and lower operating costs.
- A strong company culture motivates employees, which improves touch points with the customer, which leads to a strong brand.
- The touch point wheel consists of interactions during pre-purchase, purchase, and post-purchase.
- At companies with a strong brand, CEO is the lead brand builder. But all leaders must build the brand in their departments or business units.
- Form an executive brand council (EBC).
- To communicate the brand to the employees, segment them like you would segment customers. Then customize the message and the delivery for each employee segment.
- 1. Make the Brand Relevant to Employees. (What does this mean for me?)
- 2. Make the Brand Accessible to Employees. (What is our brand, more specifically?)
- 3. Reinforce the Brand Continuously to Employee. (What is our brand, again?)
- 4. Make Brand Education Part of New Employee Training
- 5. Reward On-Brand Behaviors (What’s in it for me?)
- 6. Hire Based on Brand Fit
- What gets measured gets managed. Set up employee-focused brand metrics. Surveys, suggestion boxes, focus groups.
- Common pitfalls: relying on broadcast instead of conversation, not allocating sufficient resources, being seduced by sexy but shallow tactics, and relying too much on technology.
13. Measuring Brand Value
- What gets measured gets managed.
- Book: Managing Brand Equity (1991) by David Aaker
- 1. Customer-centric metrics: qualitative and quantitative measurements of consumer awareness/attitudes, eg. BrandDynamics model
- 2. Sales-centric metrics: marketing mix modeling (measure ROI via statistical analysis), predictive modeling (customer most likely to respond, Customer Brand Value)
- 3. Company-valuation-centric metrics: specialists determind brand valuation using accounting and finance principles, for M&A or brand management via scorecards
14. Using Positioning to Build a Mega-brand
- 1999, NetZero invested remaining capital to position itself against AOL and MSN as “Defenders of the Free World.”
- The campaign was a big success, NetZero launched premium extensions, and NetZero eventually became United Online.
- 1. Start with a tangible point of difference that resonates with consumers.
- 2. Create the impression that you’re bigger than you are.
- 3. Be nimble in responding to changes in the marketplace, but be true to your brand.
15. Marketing Leverage in the Frame of Reference
- Do not underestimate the impact of the right frame of reference.
- 1. Broaden the frame of reference: BMW is not a sports car, it’s the ultimate driving machine; DeBeers is not in the diamond business, it’s in the gift business
- 2. Compare your offering to the gold standard even if it’s not your primary competitor: it’s not delivery, it’s Digiorno; Visa positioned itself as better than Amex even though its primary competitor was Mastercard
- 3. I am what I’m not: it’s not TV, it’s HBO
16. Finding the Right Brand Name
- If your brand name is distinctive and memorable, it can make the difference in winning.
- Your name must be memorable and ownable.
- Be careful of descriptive names, fad-ish names, or names that define a product or benefit too narrowly.
- The brand and its name should convey a personality.
- Eg. Mrs. Dash
17. Building Global Brands
- The ideal strategy is to complement global standardization with local customization.
- Consumers have high expectations of global brands, so it’s best to focus on superior benefits.
- The brand essence should stay consistent globally, with a little bit of flex for local tastes.
- Local changes include: sizing, pricing, distribution.
- Eg. Philadelphia Cream Cheese
18. Branding and Organizational Culture
- Strong brands in healthcare begin with a strong internal culture.
- Begin with a clear mission and value statement.
- If your brand is tied to your employees, they must buy into the mission and purpose of your organization.
- Eg. Northwest Memorial Healthcare.
19. Branding and the Organization
- 1. Match the brand to the internal culture and reality.
- 2. Involve senior management in the branding process.
- 3. Manage the brand actively with marketing professionals.
- There is an advantage to scale in building a brand, but there is also an advantage to small size in maintaining a strong company culture and strong core values.
20. Internal Branding
- Don’t forget your employees when communicating the brand.
- Employees can be powerful brand ambassadors.
- Good internal branding can motivate employees to provide exceptional service.