CHAPTER 7:

LEVERAGING SECONDARY BRAND

KNOWLEDGE TO BUILD BRAND EQUITY

Kevin Lane Keller

Tuck School of Business
Dartmouth College

7.1
 LEVERAGING SECONDARY BRAND KNOWLEDGE
TO BUILD BRAND EQUITY
◼ Brand equity comes through:
◼ Brand Elements
◼ Marketing program activities and product- price, distribution
◼ Marketing communication
◼ Indirect approach of building brand equity is Leveraging Secondary
Brand Knowledge.

7.2
LEVERAGING SECONDARY BRAND KNOWLEDGE TO
BUILD BRAND EQUITY

◼ Brand associations may themselves be linked to other

entities, creating secondary associations:
◼ Company (through branding strategies)
◼ Country of origin (through identification of product origin)
◼ Channels of distribution (through channels strategy)
◼ Other brands (through co-branding)
◼ Special case of co-branding is ingredient branding
◼ Characters (through licensing)
◼ Celebrity spokesperson (through endorsement advertising)
◼ Events (through sponsorship)
◼ Other third-party sources (through awards and reviews)

7.3
7.4
 Conceptualizing the Leveraging Process
◼ Linking the brand equity to some other entity- some source factor or
related person, place, or things- may create new set of associations
from the brand to the entity, as well as effecting existing brand
associations.
◼ Creation of new brand associations:
◼ Consumers may form a mental association from the brand to this
other entity and, consequently, to any or all associations,
judgments, feelings, and the like linked to that entity.
◼ Secondary brand knowledge is most likely to effect evaluation of a
new product when consumers lack either the motivation or the
ability to judge product related concerns.
◼ They may be more likely to make the purchase decision on the
basis of secondary considerations such as what they feel, think, or
know about the country from which the product came, the store in
which it is sold, or some other characteristics. 7.5
 Conceptualizing the Leveraging Process
◼ Effect of existing brand knowledge:
◼ Linking the brand to some other entity may not only create new brand
associations to the entity but also affect existing brand associations.
◼ This characterization process is called “Cognitive Consistency”-what is
true for the entity must be true for the brand.
◼ Effects on existing brand knowledge
◼ Awareness and knowledge of the entity

◼ Meaningfulness of the knowledge of the entity

◼ Transferability of the knowledge of the entity

◼ In transferring secondary knowledge the basic questions to answer:

◼ What do consumers know about the other entity?

◼ Does any of these knowledge affect what they think about when it
becomes linked or associated in some fashion with this other entity?
7.6
◼ Judgments or feelings may transfer more rapidly than more specific
associations, which are likely to seem irrelevant or be too strongly linked
to the original entity to transfer.
◼ The transferring process depends largely on the strength of the linkage
or connection in consumer’s mind between the brand and other entity. 7.7
 Conceptualizing the Leveraging Process
◼ Guidelines: Leveraging secondary brand knowledge may allow
marketers to create or reinforce an important point of difference versus
competitions, or competitive point of parity.
◼ When choosing to emphasize source factors or particular person, place,
or things, marketers should take into account consumers’ awareness as
well as how the associations, judgment, or feelings for it might be linked
to the brand or existing brand.
◼ Commonality: leveraging strategy make sense when consumer have
associations to other entity that are congruent with desire brand
associations. Example-”New Zealand Wool”
◼ Complementarity: Marketers challenge here is to ensure that less
congruent knowledge for the entity has either direct or an indirect effect
brand knowledge.

7.8
 Ways by which we can link Secondary Brand
Knowledge to the Brand
◼ Company: Branding strategy are an important determinant of the strength of
association from the brand to the company and other existing brands. Three main
branding options exist for a new product:
◼ Create a new product
◼ Adopt and modify an existing brand
◼ Combine an existing and new brand

◼ Country of Origin: the country or geographic location from which it originated

may also become linked to the brand and generate secondary associations.
◼ Many countries have become known for expertise in certain product categories or
for conveying a particular types of image.
◼ The world is becoming a “Cultural Bazar” where consumer can pick and choose
brand originating in different countries, based on beliefs about quality of certain
types of products from certain countries or the image that these brand or products
communicate.
◼ Consumer from any where of the world may choose to wear:
◼ Italian Suits, Exercise in American Athletic Shoes, Japanese MP3 player, Drive a German Car,

7.9
 Ways by which we can link Secondary Brand
Knowledge to the Brand
◼ Country of Origin:
◼ Other geographic association besides country of origin are possible, such as state,
region and cities.
◼ It is possible to create POD because consumers’ identification and belief about the
country.
◼ It is typically a legal necessity for the country of origin to appear somewhere on the
product or package.
◼ Associations to the country of origin have potential to be created at the point of
purchase and to affect brand association there.
◼ country of origin or specific geographic region is not without potential
disadvantages.
◼ Country of origin associations from both a domestic and a foreign perspective.

7.10
 Conceptualizing the Leveraging Process
◼ Channel of Distribution: channels of distribution can directly affect the
equity of the brands they sell because consumers associations linked to the retail stores
through “Image Transfer” process.
◼ Associations to product assortment, pricing and credit policy, quality of service, and so
on have their own brand images in consumer minds.
◼ Retailers create these image by the product or brand they stock and the means by
which they sell them. Ex- “If it is sold by Nordstrom, it must be good quality”.
◼ The transfer of brand image can be both positive or negative for the brand. Ex- Levi’s
Jeans.

7.11
 Co-Branding
▪ Occurs when two or more existing brands are
combined into a joint product or are marketed
together in some fashion
▪ Examples:
▪ Sony Ericsson
▪ Yoplait Trix Yogurt
▪ Nestle’s Cheerios Cookie Bars

7.12
 Advantages of Co-Branding
▪ Borrow needed expertise
▪ Leverage equity you don’t have
▪ Reduce cost of product introduction
▪ Expand brand meaning into related categories
▪ Broaden meaning
▪ Increase access points
▪ Source of additional revenue

7.13
 Disadvantages of Co-Branding

▪ Loss of control
▪ Risk of brand equity dilution
▪ Negative feedback effects
▪ Lack of brand focus and clarity
▪ Organizational distractions

7.14
 Guidelines for Co-Branding
▪ There should have adequate brand awareness; strong, favorable, unique; and
positive consumer judgment and feelings.
▪ Two brand separately have sufficient brand equity.
▪ There is a logical fit between the brand: right kind of fit in values, capabilities
and goal in addition appropriate balance in brand equity.
▪ Legalizing the contract and finalizing the financial arrangement.
▪ For brand alliance marketers should ask themselves:
▪ What capabilities do we not have?
▪ What resource constrains do we face?
▪ What growth goals or revenue needs do we have?
▪ In assessing joint branding opportunities marketers should ask themselves:
▪ Is it a profitable business venture?
▪ How does it help to maintain or strengthen brand equity?
▪ Is there any possible risk of dilution of brand equity?
▪ Does it offer many extrinsic advantages such as learning opportunities? 7.15
 Ingredient Branding
▪ A special case of co-branding which creates brand equity for materials, components, or
parts that are necessarily contained within other branded products
▪ Examples:
▪ Betty Crocker baking mixes with Hershey’s chocolate syrup
▪ Intel inside
▪ From consumer perspective, branded ingredients are often signal for quality.
▪ The uniformity and predictability of ingredient brands can reduce the risk and
reassurance consumer as it become industry standard.
▪ Ingredient brand seeks cost-effective means of differentiation and seeks opportunities
for expanding their sales.
▪ Ex- Singapore Airlines

7.16
 Ingredient Branding
▪ Advantages:
▪ From the perspective of making and supplying the ingredient: benefit of branding
is creating consumer pull, generate greater sales and greater margin.
▪ There may be stable and long term supplier-buyer relationships.
▪ From the manufacturer of the host product , the benefit is leveraging the equity
from the ingredient to enhance its own brand.
▪ Disadvantages:
▪ It is not without risk
▪ The cost of supporting marketing and communication program can be higher.
▪ There is a loss of control as there is difference between suppliers and
manufacturers marketing program.
▪ Sustainability of competitive advantages may be uncertain.
▪ Guidelines:
▪ Consumers must firs perceive that the ingredient matters to the performance and
success of the product.
▪ Consumers must be convinced that not all ingredient brands are the same and that
the ingredient is superior.
7.17
 Ingredient Branding
▪ A distinctive symbol or logo must be designed to clearly signal to consumers
that the host product contains the ingredient.
▪ A coordinated push and pull program must be put in place such that
consumers understand the importance and advantages of branded ingredient.
▪ A special case of co-branding which creates brand equity for materials,
components, or parts that are necessarily contained within other branded
products
▪ Examples:
▪ Betty Crocker baking mixes with Hershey’s chocolate syrup
▪ Intel inside
▪ From consumer perspective, branded ingredients are often signal for quality.
▪ The uniformity and predictability of ingredient brands can reduce the risk and
reassurance consumer as it become industry standard.
▪ Ingredient brand seeks cost-effective means of differentiation and seeks
opportunities for expanding their sales.
▪ Ex- Singapore Airlines 7.18
 Licensing
▪ Involves contractual arrangements whereby firms can use the names,
logos, characters, and so forth of other brands for some fixed fee
▪ Examples:
▪ Entertainment (Star Wars, Jurassic Park, etc.)
▪ Television and cartoon characters (The Simpsons)
▪ Designer apparel and accessories (Calvin Klein, Pierre Cardin, etc.)

7.19
 Celebrity Endorsement
▪ Draws attention to the brand
▪ Shapes the perceptions of the brand
▪ Celebrity should have a high level of visibility
and a rich set of useful associations, judgments,
and feelings
▪ Q-Ratings to evaluate celebrities

7.20
Celebrity Endorsement: Potential Problems
▪ Celebrity endorsers can be overused by endorsing
many products that are too varied.
▪ There must be a reasonable match between the
celebrity and the product.
▪ Celebrity endorsers can get in trouble or lose
popularity.
▪ Many consumers feel that celebrities are doing the
endorsement for money and do not necessarily
believe in the endorsed brand.
▪ Celebrities may distract attention from the brand.
7.21
 Sporting, Cultural, or Other Events
◼ Sponsored events can contribute to brand equity
by becoming associated to the brand and
improving brand awareness, adding new
associations, or improving the strength,
favorability, and uniqueness of existing
associations.
◼ The main means by which an event can transfer
associations is credibility.

7.22
 Third-Party Sources
◼ Marketers can create secondary associations in a
number of different ways by linking the brand to
various third-party sources.
◼ Third-party sources can be especially credible
sources.
◼ Marketers often feature them in advertising
campaigns and selling efforts .
◼ Example: J.D. Power and Associates’ well-publicized
Customer Satisfaction Index

7.23