Anda di halaman 1dari 45

MBA 2011-13

PRODUCT AND BRAND STRATEGIES


Dr. R.VENKATESH
ALLIANCE UNIVERSITY
MMBA
Three basic elements of the product
product attributes
product benefits
marketing support services

Characteristics of PLC and the implications for strategy
PLC and product policy
Product mix and product line
Product as a strategic variable
Life cycle of an industry
o Introduction
o Growth
o Maturity
o Decline
Emphasis on strategies, functional areas, value-
creating activities, and overall objectives varies
over the course of an industry life cycle
Adapted from Exhibit 5.8 Stages of the Industry Life Cycle
Generic
strategies
Differentiation Differentiation Differentiation Overall cost
Overall cost leadership
leadership Focus
Market
growth rate
Low Very large Low to Negative
moderate
Number of
segments
Very few Some Many Few
Intensity of
competition
Low Increasing Very intense Changing
Emphasis
on product
design
Very high High Low to Low
moderate
Stage
Introduction Growth Maturity Decline
Factor
Emphasis
on process
design
Low Low to High Low
moderate
Major
functional
area(s) of
concern
Research and Sales and Production General
Development marketing management
and finance
Overall
objective
Increase Create Defend Consolidate,
market share consumer market share maintain,
awareness demand and extend harvest, or
product life exit
cycles
Stage
Factor
Introduction Growth Maturity Decline
Products are unfamiliar to consumers
Market segments not well defined
Product features not clearly specified
Competition tends to be limited
Strategies
Develop product and get users to try it
Generate exposure so product becomes
standard
Characterized by strong increases in sales
Attractive to potential competitors
Primary key to success is to build consumer
preferences for specific brands
Strategies
Brand recognition
Differentiated products
Financial resources to support value-chain
activities
Aggregate industry demand slows
Market becomes saturated, few new adopters
Direct competition becomes predominant
Marginal competitors begin to exit
Strategies
Efficient manufacturing operations and process
engineering
Low costs (customers become price sensitive)
Industry sales and profits begin to fall
Strategic options become dependent on the
actions of rivals
Strategies
Maintaining
Exiting the market
Harvesting
Consolidation
Asset and cost surgery
Selective product and market pruning
Piecemeal productivity improvements
Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 3
A Brand is a .. A Brand is a ..
Name,
Term,
Sign,
Symbol, or
Design .
intended to
distinguish the
goods and services
from one another
Brand equity: The goodwill (equity) that an
established brand has built up over its
existence.
DREK -- differentiation, relevance (strength)
-- esteem, knowledge (stature)
Brand concept: specific meaning that brand
managers create and communicate to the
target market.
Brand concept management: the analysis,
planning, implementation, and control of a
brand concept throughout the life of the
brand.
Brand naming criteria
Commonly used research approaches
to determine brand meaning:
o Word associations
o Personifying the
brand
o Laddering up the
brand essence
Brand essence
Laddering up
o Brand bonding (through experience)
o Brand building tools
Public relations and
press releases
Sponsorships
Clubs and consumer
communities
Factory visits
Trade shows
Event marketing
Public facilities
Social cause
marketing
High value for
the money
Founders or a
celebrity personality
Mobile phone
marketing

Nikes arrangement with Michael Jordan
has provided an excellent example of a
celebrity endorsement. Can you think of
an endorsement campaign that backfired?
What did it cost the company
in the short term? What,
if any, have been the
lasting effects?
Advantages of Branding
Consumers viewpoint
1. Product quality
2. Increased shopper efficiency
3. Calls attention to new products
4. Reduces psychological risk
Sellers viewpoint
1. Handling orders, tracking down problems
2. Trademark legal protection
3. Brand loyalty
4. Reduces need for in-store contact
5. Facilitates segmentation, promotion, and pricing




Branding Challenges
o Branding Decision: To Brand or Not to Brand?
Branding Decisions
Issues in the battle of the brands: (1) how
prices are set? (2) turnover, and (3) gross
margin.
Manufacturer brands: (1) prices are set to
maximize profit for the brand and are influenced
by competitive forces, (2) they have a higher
turnover than distributor brands. (Why??)
Distributor brands: (1) prices are set to maximize
profit for the store and (2) they have a higher
gross margin than manufacturer brands.
(Why??)

Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 31
Adding An Item: Four Brand Adding An Item: Four Brand
Types Types
Product Category
Existing New
Existing Line
Extension
Brand
Extension Brand
Name
New Flanker
Brand
New
Product
Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 49
Strategies for Brand Revival Strategies for Brand Revival
Underlying cause?
Reformulate the product/package
Move the product into new foreign
or domestic markets
Discover and promote new uses
for the product
New promotion campaign/agency
Cost reduction
Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 50
Options for dropping Options for dropping
products products
Revive if justified in believing brand can
be saved
Drop promotional activities (reducing
costs) and rely on repeat purchases
(which will be more profitable as they
continue)
Contract or license to another company
for manufacturing
Sell off/dispose of brand
Dalrymple & Parsons/Marketing Management 7th edition: Chapter 7 51
Selling/ Removing a Product Selling/ Removing a Product
Involves Involves
Minimizing inconvenience to customers
and channel partners
Notify dealers in advance
Help dealers clear out old stock
Offer dealer discounts on discontinued brands
Buy back unsold merchandise
Information on replacement brands should be easily
available
Arrange to provide service and parts for recent buyers
(customer goodwill)
They cant stand out in the marketplace and they are
struggling to connect with people. Here are six reasons
why.
Michael Eisner of Disney has called the word
brand over-used, sterile, and unimaginative.
Hes right. As the brand manual grows heavier
and more detailed you know youre in trouble.
Making sure the flowers in reception conform to
the brand guidelines just shows you are looking
in the wrong direction. Consumers are who you
should be paying attention to. What matters to
them. Otherwise, youre hiding, and youre in
trouble.
There is a new anti-brand sensibility. There is
much more consumer awareness, more
consumers who understand how brands work
and, more importantly, how they are intended to
work on them! For most brands there is nowhere
left to hide. The information age means that
brands are part of the public domain. Hidden
agendas, subliminal messages, tricky moves
forget it. For most brands it is a new age of
consumer savvy.
The new consumer is better informed, more critical, less
loyal, and harder to read. The white suburban housewife
who for decades seemed to buy all the soap powder no
longer exists. She has been joined by a new population
of multi-generational, multi-ethnic, multi-national
consumers
The more brands we invent the less we notice them as
individuals. If youre not Number One or Two, you might
as well forget it. And the greater the number of brands,
the thinner the resources promoting them. You get a
treadmill of novelty, production value, incremental
change, tactical promotions, and events
The definitions, charts, diagrams, and tables. There are
too many people following the same rule book. When
everybody tries to beat differentiation in the same way
nobody gets anywhere. Formulae cant deal with human
emotion. Formulae have no imagination or empathy
The story of brands has gone from daring and inspiration
to caution and aversion to risk. Once the darling of the
bold and the brave, brands are relying on the
accumulation of past experiences rather than the
potential of future ones.
The Lovemarks of this new century will be the brands
and businesses that create genuine emotional
connections with the communities and networks they live
in. This means getting up close and personal. And no
one is going to let you get close enough to touch them
unless they respect what you do and who you are.
Love needs Respect right from the start. Without it, Love
will not last. It will fade like all passions and infatuations.
Respect is what you need when you are in for the long
haul.
Respect is one of the founding principles of Lovemarks
Lovemarks are the future beyond brands.
Lovemarks inspire loyalty beyond reason.
Lovemarks are built on Love and Respect.
Lovemarks are owned by the people who love
them - consumers not companies.
Lovemarks can be everything that people care
deeply about

Lovemarks read ROI as Return on Involvement.
Lovemarks are more than irreplaceable. They
are Irresistible
Kung Fu guys are Irreplaceable. Bruce Lee is
Irresistible - 32 years on from his death.
The classic T-shirt is Irreplaceable.
Local or global. you recognize Lovemarks
instantly.

IDEA #1 DRIP WITH EMOTION
Differentiation is beyond reason , beyond efficiency,
benefit, performance, functionality. Table stakes all!!
Fact : Emotion, intuition, long-term memories and
unconscious motivations control as much as 85% of our
decision-making process.



Consumers are saying: Youve got three
seconds to change my life or you are gone.
From Information Economy, Knowledge
Economy, Interruption Marketing (aka the Mass
Market), Permission Marketing, the Experience
Economy, the Attention Economy to the
ATTRACTION ECONOMY.

Low Respect. Low Love . Commodities, utilities, raw
material. No names with no claims. The world of
discounts, price wars, crushing competition.
High Love. Low Respect . Hero today zero tomorrow.
Fads and infatuations, promotions and competitions.
Reality shows , J Lo jeans, Paris Hilton, the President of
the US.
High Respect. Low love . Brand to bland. Where those
er words leach you dead: faster, bigger, brighter,
cheaper.
High Love and High Respect . Lovemarks. Enchanting
innovation. Irresistible appeal.

Mystery The beguiling power of the unknown.
Metaphors and dreams, symbols and stories.
The flow of past, present and future. When we
know everything, there is nothing left to delight
us.
Sensuality - Sight, sound, smell, touch and
taste are portals to the emotions. never pay a
premium for anything that doesn't excite most of
your senses.
Intimacy is knowing the consumer better than
she knows herself.
The energy field is sight, sound and motion.
Saatchi & Saatchi invented sisomo for the
Screen Age, the everywhere world beyond TV.
89% of major brands are planning to market via
mobile phones by 2008, and more than half of
brands plan to spend between 5% and 25% of
their marketing budget in the medium in the next
five years. (Airwide Solutions)


sisomo brings technology, marketing and creativity together. This
intersection is the future of advertising.
sisomo is where art meets science.
sisomo puts ideas and potent connections ahead of technology.
sisomo brings screens to life in emotional and compelling ways.
sisomo attracts consumers with engaging, compelling stories. The
story is an ancient, mysterious, timeless art. Marketers are caught
up in technology and methodology. An engaging story well told is
priceless.
sisomo inspires new formats, characters and ways for consumers
to participate on screen. Multi-layered, multi-purpose stories that
consumers can be absorbed by, play with, add to, recreate, and
spread virally.

Boundaries are collapsing. Categories are blurring. Convergence
and divergence are imploding. Entire new industries are emerging.
The Screen Age is about being a creative connector.
Creative Connectors across media, advertising, marketing, design,
entertainment, games, phones, ringtones, activations, instore TV,
sound logos, animation, sisomo packaging, you name it.
Lovemarks is about Creative Connectors inspiring loyalty beyond
reason across the family of screens.
The key connect is the Inspirational Consumer, the ones who love
your brand, get there first, tell your story and improve it for free.
Inspire and connect them!! They turn brands into Lovemarks.
Lovemarks is about lives taking over brands.
Either / Or compromises. You stay static. .And / And explodes
through to the next level of possibility.
STARBUCKs: home and work. Coffee and music and movies
APPLE: Business modelling ($1 a song) and networking (music
companies) and branding (white buds and wires)
TOYOTA : gas and electric. Short and long term. Competitive and
Open. Cost reduction and innovation.
Lovemarks build complex opposites together with equal passion so
they enhance each other and take you to a place neither dreamed
possible.
The role of business is to make the world a better place
for everyone. Its a powerful, provocative, inescapable
statement. Its plain business sense you can be
loathed, liked or loved.

Lovemarks make the consumers love you




THE END