Customer - Centered Brand Management

Presented By:Ishant Mahajan

Sunil Goyal
Sarthak Gupta Rishi Bhatia Sarvesh Malhotra Abhinav Juneja

WHAT DO THESE THINGS HAVE IN COMMON?

The golden arches, the Nike swoosh, and an apple icon?

What is a brand ?

Nissan Micra versus Renault Pulse

WHAT IS A BRAND ?
Brand is a consumers perception about the product that gives a unique identity to the companys products and

create emotional associations with consumers.

Al and Laura rise in The 22 immutable laws of branding says: Branding presells the product or service to the user it is

simply more efficient way to sell things.

Coke vs. Pepsi

In 'blind' taste tests, people prefer the taste of Pepsi over the taste of Coke. However, if the test is not 'blind' and the tasters know which beverage is which, they prefer the taste of Coke over Pepsi! That is the emotional power of a brand. The Coca-Cola to brand has the an power actually change

individual's taste!

A set of product perceptions by the consumer.

WHAT A BRAND MEANS TO COMMON PERSON ?

It is a personality developed over time.

A brand signifies a relationship with the customer. It is the companys most valuable asset. Its also the main
differentiator, the best defense against price competition, and the key to customer loyalty.

Competitors can copy your features and benefits, but

they cant steal your brand.

Its a promise.

Oldsmobile
American car brand launched earlier than any other in
existence today

1988 ad campaign featuring the slogan, "This is not your

father's Oidsmobile.

1990, ad campaign a new generation of olds. 2000, Oldsmobile's market share had sputtered to 1.6%,
from 6.9% in 1985. And in December 2000, General Motors announced that the Oldsmobile brand would be phased out.

IT'S OK, I'M WITH THE BRAND

Courtesy of songwriter and performer George Clinton.

Clinton in the 1970s sought the attention of two different segments of record buyers-mainstream listeners, who liked vocal soul music with horns, and progressive listeners, who liked harder-edged funk.

He made 2 different band names:

Parliament, when the music was aimed at popular tastes. Funkadelic, when it was edgier.

Both bands were very successful, even though some

Parliament fans would never listen to Funkadelic and vice versa

ECONOMIES OF SCALE
Shift to narrower and more numerous brands is difficult for
even the most astute marketers to accept.

Unilever, for example, fought against market

fragmentation by instituting a brand consolidation program in 1999. Its management eliminated hundreds of brands in search of economies of scale.

Among the discarded were such successful brands as

Elizabeth Arden cosmetics and the Diversey cleaning and hygiene business.

Five years later, Unilever's sales have stagnated, while

primary competitor Procter & Gamble, with its niche branding strategy, has enjoyed healthy gains.

CUSTOMER EQUITY IS THE POINT

Companies geared today to
aggrandising their brand assuming Sales will follow.

Firms to be successful over time, should maximize Customer Lifetime Value

Companies must focus on Customer

Equity rather than Brand Equity.

Our Attitude should be that Brands

come & go but Customers must remain.

THE VALUE OF A BRAND DEPENDS ON THE CUSTOMER

Brand Value of a Brand is highly individualized. Most Marketing Managers measure Brand Equity with a
summary metric of brand strength.

A perfect example of Flaw of Averages.

Assigning an Average value to Brand Equity is Dangerous. Managers believe that Brand Value is Intrinsic.

PUT YOUR BRANDS IN THEIR PLACE

IF U ACCEPT THAT THE GOAL OF MANAGEMENT IS TO GROW CUSTOMER EQUITY, NOT BRAND VALUE, THEN YOU WILL LIKELY T MANAGE YOUR BRANDS IN A DIFFERENT WAY.
There are seven directives that go against the grain of current practice, They are:

1.

Make brand decisions subservient to decisions about customer relationship.

Strengthening the role of customer segment manager.
Assigning managers to specific customers.

2.

Build brands around customer segments, not the other way around.
Focus on the needs and requirements of a particular customer segment.

3. Make your brand as narrow as possible.

The purpose of a brand here is to satisfy a small customer segment as it is economically feasible.

4. Plan brand extensions based on customer needs,

not component similarities.

It works well when customers are similar.

5. Develop the capability and the mind-set to hand off customers to other brands in the company.

Future profits are driven not by repeat purchases of particular product but by customers purchases across all brands.

6. Take no heroic measures.

If brand managers control the resources they will persist too long with a brand that has lost its punch. Retiring ineffective brands is easier to do if the marketing resources of the firm are controlled by customer segment managers.

7. Change how you measure brand equity.

Brand Equity is defined as the overall strength of the brand in the market place and its value to the company that owns it. Brand equity varies from customer to customer. The focus should be on :

Brand awareness (advertisement in terms of recognition & recall)

Attitude towards the brand

Brand ethics

BRAND EQUITY IN SCHEME OF THINGS

Brand managers have long struggled to find the right
formula for measuring brand equity.

To measure brand equity, First, we must put it in the context

of customer equity. Second, we must recognize that it varies by individual.

Let's start with the bottom line, which is customer equity, the
sum of the lifetime values of the firm's customers.

As we know, a customer's lifetime value is driven by choices,

and those choices are driven by three considerations i.e.

I. Quality, II. Price, III. Convenience

 Once the relative importance of brand equity is established,

the next challenge is to figure out what drives brand equity in

a particular company.

These drivers include elements like consumers awareness of

the brand, their attitudes toward the brand, and their perceptions of the company's ethics and corporate citizenship.

The final step is to statistically link the customer equity drivers

to customer lifetime value-at the level of the individual
customer.

How Big to Brand?

When the company's mindsets change to consumers Then the question arises

HOW BIG SHOULD THE BRAND BE?

 Customers taste and preferences changes from time to

time

Customers as a individual has unique taste and desires

Customers
loot at brands to provide safety. Buying a

popular brands not only increases the customers trust

that the offering will perform but also contributes to the customer social needs

Like in the magazine industry ,first there was only general

magazines but nowadays there is a separate magazine for each thing like life, health and fitness.

Overcome your blind spot

 People learning to drive quickly realize that they have a

vulnerable area where there vision is hindered

In same way for many organizations, brand is one

those blind spots

Marketing Executives must begin looking at the

problem of brand management more deliberately and from customer from point of view.

In customer centered organization, brands are

important, but its not all

Therefore companies cant be structured, staffed and

motivated to grow brand.

First Step

Develop a competent cadre of customer segment managers

Second step Hand them the purse strings

Third Step

Track and reward their progress using reliable metrics for customer and brand equity