BRAND COMMUNICATION

A STRATEGIC
MARKETING APPROACH

GROWING AND SUSTAINING BRAND EQUITY

A Firm having developed a brand, now looks at how to create,
maintain and enhance brand equity under various situations and
circumstances.
The branding strategy of a firm determines which brand elements a
firm chooses to apply across the products it offers for sale.
Branding strategy is critical because it is the means by which the firm
can help consumers understand its products and services and
organize them in their mind.
Many firms employ complex branding strategies. For example, brand
names may consist of multiple brand name elements ( Toyota Camry
V6 XLE ) and may be applied across a range of products ( Toyota cars
and trucks).
What is the best way to characterize a firms branding strategy
under such instances and what guidelines exist to choose the right
combinations of brand names and other brand elements, is the focus
of our discussion.

STRATEGIC TOOLS
The brand product matrix and the brand hierarchy help
to characterize and formulate branding strategies by defining
various relationships among brands and products.
Brand Architecture: The brand architecture, for a firm tells
marketers which brand names, logos, symbols and so forth to
apply to which new and existing products.
We often distinguish branding strategies by whether a firm is or
should be employing an umbrella corporate or family brand for
all of its products ( as a branded house, or a collection of
individual brands all with different names ( as a house of
brands).
Brand architecture defines both boundaries and complexity.
Which different products should share the same name? How
many variations of the brand name should we employ?

Contd
The role of defining branding strategies and brand architecture is two
- fold :
1. Clarify -- Brand Awareness: Improve consumer understanding and
communicate similarity and differences between individual products.
2. Motivate Brand Image: Maximize transfer of equity to/from the
brand to individual products to improve trial and repeat purchase.

The Brand Product Matrix:

To characterize the product and branding strategy of a firm, one useful
tool is the brand-product matrix. It is a graphical representation of all
the brands and products sold by the firm.
The matrix (or grid) has the brands of a firm as rows and the
corresponding products as columns.
The rows of the matrix represent brand product relationships and
capture the brand extension strategy of the firm in terms of the
number and nature of products sold under the firms different brands.

Contd.
A brand line consists of all products original as well as line and
category extensions sold under a particular brand. Thus, a brand line
is one row of the matrix.
We want to judge a potential new product extension for a brand on
how effectively it leverages existing brand equity from the parent
brand to the new product, as well as how effectively the extension, in
turn, contributes to the equity of the parent brand.
The columns of the matrix represent product brand relationships and
capture the brand portfolio strategy in terms of the number and
nature of brands to be marketed in each category.
The brand portfolio is the set of all brands and brand lines that a
particular firm offers for sale to buyers in a particular category.
A product line is a group of products within a particular category
that are closely related because they function in a similar manner, are
sold to the same customer groups, are marketed through the same
type of outlets, or fall within given price ranges.

Contd.
A product line may include different brands, or a single family
brand or individual brand that has been line extended.
A product mix (or product assortment) is the set of all product
lines and items that a particular seller makes available to buyers.
A brand mix (or brand assortment) is the set of all brand lines
that a particular seller makes available to buyers.
The BREADTH And DEPTH of a branding strategy describes the
number and nature of different products linked to the brands
sold by a firm.
The firm has to make strategic decisions about how many
different product lines it should carry ( the breadth of the product
mix), as well as how many variants to offer in each product line
( the depth of the product mix).

Contd..

The main reasons for a firm to have multiple brands in the same
category is to ensure broad market coverage. By adopting
multiple brands, the firm is able to pursue different price
segments, different channels of distribution and different
geographic boundaries.
Many firms have to introduce multiple brands because no one
brand is viewed equally favourably by all the different market
segments the firm would like to target.
Other reasons include:
- To increase shelf presence and retailer dependence in the store
- To attract consumers seeking variety who may otherwise switch
to another brand
- To increase internal competition within the firm
To yield economies of scale in advertising, sales, merchandising
and physical distribution.

Contd..
In designing the optimal brand portfolio, marketers generally need
to trade off market coverage and these other considerations with
costs and profitability.
Brand lines with poorly differentiated brands are likely to be
characterized by much cannibalization and require appropriate
pruning.
The basic principle in designing a brand portfolio is to maximize
market coverage so that no potential customers are being ignored,
but minimize brand overlap so that brands arent competing among
themselves to gain customers approval. Each brand should have a
distinct target market and positioning.
Roles of a Brand as part of a brand portfolio
Flanker: These are protective or fighter brands.
The purpose of flanker brands is to create stronger points of parity
with competitors brands so that more important ( and more
profitable) flagship brands can retain their desired positioning.

Roles of Brands
Many firms are introducing discount brands as flankers to
better compete with store brands and private labels and protect
their higher priced companions.
While designing flanker brands, firms must be careful. The
flankers should not be so attractive that they take sales away
from their higher priced companion brands. On the other hand,
they should NOT be designed so cheaply that they reflect poorly
on these other brands.
Cash Cows: Some brands may be retained despite dwindling
sales because they still manage to hold on to a sufficient
number of customers and maintain their profitability with
virtually no marketing support.
Low end Entry Level or High-end Prestige Brands: Many
brands introduce line extensions or brand variants in a certain
product category that vary in price and quality.

Brand Hierarchy
A brand hierarchy is a useful means of graphically portraying a
firms branding strategy by displaying the number and nature
of common and distinctive brand elements across the firms
products, revealing the explicit ordering of brand elements.
The highest level of the hierarchy technically always consists of
one brand the corporate or company brand.
At the next lower level, a family brand is used in more than
one product category but is not necessarily the name of the
firm. (eg. Tropicana and Lays)
An individual brand is a brand restricted to essentially one
product category, although it may be used for several different
product types within that category.
A modifier is a means to designate a specific item or model
type or a particular version or configuration of the product.

Designing a Branding Strategy

Corporate objectives, consumer behaviour or competitive activity may

sometimes dictate significant deviations in branding strategy and the way
the brand hierarchy is organized for different products or different markets.
Thus the brand hierarchy may not be symmetric. Brand elements may
receive more or less emphasis, or not be present at all, depending on the
particular products and markets.
Brand elements at each level of the hierarchy may contribute to brand
equity through their ability to create awareness as well as foster strong,
favorable and unique brand associations and positive responses.
Therefore, the challenge in setting up the brand hierarchy and arriving at a
branding strategy is to:
(1) design the proper brand hierarchy with the right number and nature of
brand elements to use at each level, and
(2) design the optimal supporting marketing program to create the desired
amount of brand awareness and type of brand associations at each level.

Contd..

Specifically the marketers must decide:

1. The number of levels of the hierarchy to use in general
2. The desired brand awareness and image at each level
3. Combinations of brand elements from different levels of the
hierarchy, if any, for any one particular product.
4. How any one brand element is linked, if at all, to multiple products.
The practice of combining an existing brand with a new brand is called
sub-branding because the subordinate brand is a means of modifying
the superordinate brand.
For example, ThinkPad was a sub-brand to the IBM name, and T42 was
a second-level sub-brand to further modify the meaning of the product.
A sub-brand, or hybrid-branding strategy can also allow for the creation
of specific brand beliefs.

Contd.
The principle of simplicity is based on the need to provide
the right amount of branding information to consumers.
The principle of relevance is based on the advantages of
efficiency and economy.
The principle of differentiation is based on the disadvantages
of redundancy. Marketers should distinguish brands at the
same level as much as possible.
The principle of prominence states that the relative
prominence of the brand elements determines which
element or elements become the primary one(s) and which
become the secondary one(s).
The principle of commonality states that the more common
brand elements products share, the stronger the linkages
between the products.

Developing a Brand Architecture

In developing the optimal brand strategies, marketers must first

define the relevant customer segments.
Second, marketers must have well-defined brand positioning and
equity in terms of points of parity and points of difference.
The brand mantra can be crucial to help establish product
boundaries or brand guard rails.
Following are guidelines for developing brand architecture:
1. Adopt a strong customer focus.
2. Avoid over-branding.
3. Establish rules and conventions and be disciplined.
4. Create broad, robust brand platforms.
5. Selectively employ sub-brands as a means of complementing and
strengthening brands.
6. Selectively extend brands to establish new brand equity and
enhance existing brand equity.

NEW PRODUCTS AND BRAND

EXTENSIONS

When a firm introduces a new product, it has three choices for

branding it:
1. It can develop a new brand, individually chosen for the new
product.
2. It can apply, in some way, one of its existing brands.
3. It can use a combination of a new brand and an existing brand.
A brand extension occurs when a firm uses an established brand
name to introduce a new product.
When a new brand is combined with an existing brand, the brand
extension can also be a sub-brand.
An existing brand that gives birth to a brand extension is the parent
brand.
If the parent brand is already associated with multiple brands
through brand extensions, then it may also be called a family brand.

Brand Extensions

Companies make brand extensions in the hope that the extensions

will be able to ride on the equity of the successful brands, and that
the new brand will stand in its own right in the course of time.

Brand extensions fall into two categories:

A) Line Extension: Marketers apply the parent brand to a new
product that targets a new market segment within a product
category the parent brand currently serves.
A line extension often adds a different flavour or ingredient variety,
a different form or size, or a different application for the brand.
E.g: Head and Shoulders Dry Scalp or Anti Dandruff Shampoo.
B) Category Extension: Marketers apply the parent brand to enter a
different product category from the one it currently serves.
E.g: Havells adding Home appliances to its electrical products
range.

A few successful Examples

1. Lifebuoy has a number of extensions like Lifebuoy Plus,

Lifebuoy Liquid and Lifebuoy Gold.
2. Amul initially launched milk powder. It had several
category extensions such as butter, cheese, cheese spread
etc, and finally added ice cream, curd etc to its portfolio.

An example of the extreme success of brand extensions is

that of Classic Milds, a brand extension of the premium
cigarette of ITC Ltd.

It became such a success that it cannibalized the sales of

its own mother brand. Today Classic Milds enjoys a much
higher market share than Classic which has been relegated
to the number two slot.

Advantages of Extensions

1. Facilitates New Product Acceptance

2. Improves brand Image
3. Reduces Risk Perceived by Customers
4. Increases the probability of gaining distribution and trial
5. Reduces costs of Introductory and follow-up Marketing
Programs
6. Avoid Cost of Developing a New Brand
7. Allow for Packaging and Labeling Efficiencies
8. Enhance the Parent Brand Image
9. Brings new customers into the brand franchise and
increase market coverage.
10. Revitalize the brand
11. Permit subsequent extensions.

Disadvantages

1. Can
2. Can
3. Can
4. Can
5. Can
6. Can
7. Can
8. Can
brand

When extending a brand, a marketer should be extremely

cautious that it does not go against the generic brand position,
which is at the core or the heart of the brands image and equity.

confuse or frustrate consumers

encounter retailer resistance
fail and thereby hurt parent brand image
succeed but cannibalize sales of parent brand
succeed but diminish identification with any one category
succeed but hurt the image of parent brand
dilute brand meaning
cause the company to forgo the chance to develop a new

Evaluating Brand Extension

Opportunities
1. Define Actual and Desired Consumer Knowledge about the brand:

In order to uncover extension opportunities for a brand, the first step is to

discover the brand itself.

The core of the brand is the knowledge network that exists in peoples mind.
Brand is a central node to which various other nodes tend to be connected
with varying degrees of strengths.
It is critical for marketers to fully understand the depth and breadth of
awareness of the parent brand, and the strength , favorability and
uniqueness of its associations.
Exploring the brand involves seeking answers to the following questions both
qualitatively and quantitatively:
- What is a brands awareness level?
- What are its recall and recognition levels?

Contd

2. Identify Possible Extension Candidates

The objective is to identify product categories that might
seem to fit with the brand image in the minds of the
customers.

What
What
What
What
What
What
What

are the different attributes associated with a brand?

benefit associations are connected with a brand?
are a brands personality associations?
are the symbols associated with the brand?
are a brands user associations?
is the perceived essence of the brand?
is the brands philosophy?

Contd..

3. Evaluate the Potential of the Extension candidate

to create equity.
This is done according to the three-factor model:
* Salience of parent brand associations
* Favorability of inferred extension associations
* Uniqueness of inferred extension associations
4. Evaluate extension candidate feedback effects
according to the four-factor model:
* How compelling the extension evidence is
*How relevant the extension evidence is
* How consistent the extension evidence is
* How strong the extension evidence is

Contd..
5. Consider possible competitive advantages as perceived by
consumers and possible reactions initiated by competitors.
6. Design marketing campaign to launch extension.
7. Evaluate extension success and effects on parent brand equity.
Conclusion:
Marketers have to tread a fine line between leveraging a brand
through extensions on the one hand and ensuring it does lead to
brand dilution on the other.
Extensions involve transfer of parent brand associations to the
extensions.
The nature of the parent brand is a crucial determinant of extension
success.
Hence, before embarking on an extension program, a brands
extendibility must be judged.