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MARKETING IN TODAY’S GLOBAL
BUSINESS ENVIRONMENT
Module 3
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INFORMATION NEEDS PROBES
What decisions do you regularly make? What information do you need to make
these decisions?
What information do you regularly get?
What studies do you periodically request? What information would you want that you
are not getting now?
What are the four most helpful
improvements that could be made in thepresent marketing information system?
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INTERNAL RECORDS AND MARKETING INTELLIGENCE
Order-to-payment cycle
Sales information system
Databases, warehousing, data miningMarketing intelligence system
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DATABASE MANAGEMENT
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WHAT IS A
MARKETING INTELLIGENCE SYSTEM?
A marketing intelligence system is
a set of procedures and sources that
managers use to obtain everydayinformation about developments in
the marketing environment.
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STEPS TO QUALITY MARKETING INTELLIGENCE
Train sales force to scan for new
developments
Motivate channel members to share
intelligence
Hire external experts to collect intelligence
Network externally
Utilize a customer advisory panel
Utilize government data sources
Purchase information
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SOURCES OF COMPETITIVE INFORMATION
Independent customer goods and service
review forums
Distributor or sales agent feedback sites
Combination sites offering customer reviews
and expert opinions
Customer complaint sites
Public blogs
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NEEDS AND TRENDS
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 3-8
Fad
Trend
Megatrend
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MAJOR FORCES IN THE ENVIRONMENT
Demographic
Economic
Socio-cultural
Natural
Technological
Political-legal
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POPULATION AND DEMOGRAPHICS
Population growth
Population age mix
Ethnic markets Educational groups
Household patterns
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PERSPECTIVE ON THE GLOBAL DEMOGRAPHIC
ENVIRONMENT
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ECONOMIC ENVIRONMENT AND CONSUMER
PSYCHOLOGY
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INCOME DISTRIBUTION
Subsistence economies
Raw-material-exporting economies
Industrializing economies Industrial economies
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SOCIAL-CULTURAL ENVIRONMENT
Views of themselves
Views of others
Views of organizations Views of society
Views of nature
Views of the universe
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SOCIO-CULTURAL INFLUENCES
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NATURAL ENVIRONMENT
Shortage of raw materials
Increased energy costs
Anti-pollution pressuresGovernmental protections
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KEYS TO AVOIDING
GREEN MARKETING MYOPIA
Consumer Value Positioning
Calibration of Consumer Knowledge
Credibility of Product Claims
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CONSUMER ENVIRONMENTAL SEGMENTS
Genuine Greens
Not Me Greens
Go-with-the-Flow Greens
Dream Greens
Business First Greens
Mean Greens
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TECHNOLOGICAL ENVIRONMENT
Pace of change
Opportunities for innovation
Varying R&D budgets Increased regulation of change
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THE POLITICAL-LEGAL ENVIRONMENT
Business Legislation
Growth of Special Interest Groups
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FORECASTING AND
DEMAND MEASUREMENT
How can we measure market demand?
Potential market
Available marketTarget market
Penetrated market
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A VOCABULARY FOR
DEMAND MEASUREMENT
Market Demand
Market Forecast
Market Potential
Company Demand
Company Sales Forecast
Company Sales Potential
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ESTIMATING CURRENT DEMAND:
TOTAL MARKET POTENTIAL
Calculations
Multiple potential number of buyers by average
quantity each purchases times price Chain-ratio method
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ESTIMATING CURRENT DEMAND:
AREA MARKET POTENTIAL
Market-Buildup
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ESTIMATING CURRENT DEMAND:
AREA MARKET POTENTIAL
Multiple-Factor Index
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ESTIMATING FUTURE DEMAND
Survey of Buyers’ Intentions
Composite of Sales Force Opinions
Expert Opinion
Past-Sales Analysis
Market-Test Method
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CONSUMER BEHAVIOR
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WHAT INFLUENCES
CONSUMER BEHAVIOR?
Cultural Factors
Social Factors
Personal Factors
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WHAT IS CULTURE?
Culture is the fundamental
determinant of a person’s wants and
behaviors acquired through
socialization processes with familyand other key institutions.
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SUBCULTURES
Nationalities
Religions
Racial groups
Geographic regions
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FAST FACTS ABOUT
AMERICAN CULTURE
The average American:
chews 300 sticks of gum a year
goes to the movies 9 times a year
takes 4 trips per year
attends a sporting event 7 times each
year
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SOCIAL CLASSES
Upper uppers
Lower uppers
Upper middles
Middle
Working
Upper lowers
Lower lowers
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SOCIAL FACTORS
Reference groups
Family
Social roles
Statuses
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REFERENCE GROUPS
Membership groups
Primary groups
Secondary groups
Aspirational groups
Disassociative groups
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FAMILY DISTINCTIONS
AFFECTING BUYING DECISIONS
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PERSONAL FACTORS
Age
Life cycle stage
Occupation
Wealth
Personality
Values
Lifestyle
Self-concept
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AGE AND STAGE OF LIFECYCLE
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OCCUPATION AND ECONOMIC CIRCUMSTANCES
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PERSONALITY
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BRAND PERSONALITY
Sincerity
Excitement
Competence
Sophistication
Ruggedness
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LOHAS (LIFESTYLES OF HEALTH AND
SUSTAINABILITY) MARKET SEGMENTS
Sustainable Economy
Healthy Lifestyles
Ecological Lifestyles
Alternative Health Care
Personal Development
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MODEL OF CONSUMER BEHAVIOR
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MOTIVATION
Freud’s
Theory
Behavior
is guided by
subconscious
motivations
Maslow’s
Hierarchy
of Needs
Behavior
is driven by
lowest,
unmet need
Herzberg’s
Two-Factor
Theory
Behavior is
guided by
motivating
and hygienefactors
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MASLOW’S HIERARCHY
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PERCEPTION
Selective attention
Selective retention
Selective distortion
Subliminal perception
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LEARNING
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EMOTIONS
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MEMORY
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STATE FARM MENTAL MAP
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CONSUMER BUYING PROCESS
Problem Recognition
Information Search
Evaluation of alternatives
Purchase Decision
Postpurchase Behavior
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SOURCES OF INFORMATION
CommercialPersonal
Public Experiential
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SUCCESSIVE SETS IN DECISION MAKING
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A CONSUMER’S BRAND BELIEFS ABOUT LAPTOP
COMPUTERS
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NON-COMPENSATORY MODELS OF CHOICE
Conjunctive
Lexicographic
Elimination-by-aspects
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PERCEIVED RISK
Functional
Physical
Financial
Social
Psychological
Time
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HOW CUSTOMERS USE OR DISPOSE OF
PRODUCTS
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LOW-INVOLVEMENT DECISION MAKING
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DECISION HEURISTICS
Availability
Representativeness
Anchoring and adjustment
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FRAMING
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MENTAL ACCOUNTING
Consumers tend to…
Segregate gains
Integrate losses Integrate smaller losses with larger gains
Segregate small gains from large losses
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WHAT IS ORGANIZATIONAL BUYING?
Organizational buying refers to the
decision-making process by which
formal organizations establish the
need for purchased products andservices, and identify, evaluate, and
choose among alternative brands and
suppliers.
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TOP MARKETING CHALLENGES
Understanding customer needs in new ways; Identifying new opportunities for growth;
Improving value management techniques
Calculating better marketing performance and
accountability metrics; Competing and growing in global markets
Countering the threat of product and service
commoditization
Convincing C-level executives to embrace themarketing concept
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CHARACTERISTICS OF BUSINESS MARKETS
Fewer buyers
Close supplier-
customer
relationships Professional
purchasing
Many buying
influences
Multiple sales calls
Derived demand
Inelastic demand
Fluctuating demand
Geographically
concentrated buyers
Direct purchasing
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BUYING SITUATION
Straight Rebuy
Modified Rebuy
New Task
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SYSTEMS BUYING AND SELLING
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OF CONCERN TO MARKETERS
Who are the major decision participants?
What decisions do they influence?
What is their level of influence?
What evaluation criteria do they use?
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STAGES IN THE BUYING PROCESS: BUYPHASES
Problem recognitionGeneral need description
Product specification
Supplier search Proposal solicitation
Supplier selection
Order-routine specification Performance review
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BUYGRID FRAMEWORK
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FORMS OF ELECTRONIC MARKETPLACES
Catalog sites
Vertical markets
Pure play auction sites
Spot markets
Private exchanges
Barter markets Buying alliances
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AN EXAMPLE OF VENDOR ANALYSIS
METHODS FOR RESEARCHING
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METHODS FOR RESEARCHING
CUSTOMER VALUE
Internal engineeringassessment
Field value-in-use
assessment Focus-group value
assessment
Direct survey
questions
Conjoint analysis
Benchmarks
Compositional
approach Importance ratings
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ORDER ROUTINE SPECIFICATION
Stockless purchase plans
Vendor-managed inventory
Continuous replenishment
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CATEGORIES OF BUYER-SELLER RELATIONSHIPS
Basic buying and
selling
Bare bones Contractual transaction
Customer supply
Cooperative systems
Collaborative
Mutually adaptive
Customer is king
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INSTITUTIONAL MARKETS
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EFFECTIVE TARGETING REQUIRES…
Identify and profile distinct groups of buyerswho differ in their needs and preferences
Select one or more market segments to enter
Establish and communicate the distinctive
benefits of the market offering
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WHAT IS A MARKET SEGMENT?
A market segment consists
of a group of customers who
share a similar set ofneeds and wants.
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SEGMENTING CONSUMER MARKETS
Geographic
Demographic
Psychographic
Behavioral
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GEOGRAPHIC SEGMENTATION
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CLARITAS’ PRIZM
Education and affluence
Family life cycle
Urbanization
Race and ethnicity
Mobility
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DEMOGRAPHIC SEGMENTATION
Age and life cycle
Life stage
Gender
Income
Generation
Social classRace and Culture
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AGE AND LIFECYCLE STAGE
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GENDER AND INCOME
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RACE AND CULTURE
PSYCHOGRAPHIC SEGMENTATION
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PSYCHOGRAPHIC SEGMENTATION
AND THE VALS FRAMEWORK
BEHAVIORAL SEGMENTATION BASED ON NEEDS
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BEHAVIORAL SEGMENTATION BASED ON NEEDS
AND BENEFITS
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BEHAVIORAL SEGMENTATION: BEHAVIORAL
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BEHAVIORAL SEGMENTATION: BEHAVIORAL
VARIABLES
Occasions
Benefits
User StatusUsage Rate
Buyer-Readiness
Loyalty Status
Attitude
EXAMPLE OF A BRAND FUNNEL
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EXAMPLE OF A BRAND FUNNEL
LOYALTY STATUS
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LOYALTY STATUS
Hard-core
Split loyals
Shifting loyals
Switchers
BEHAVIORAL SEGMENTATION BREAKDOWN
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BEHAVIORAL SEGMENTATION BREAKDOWN
SEGMENTING FOR BUSINESS MARKETS
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SEGMENTING FOR BUSINESS MARKETS
Demographic
Operating variable
Purchasing approaches
Situational factors
Personal characteristics
STEPS IN SEGMENTATION PROCESS
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STEPS IN SEGMENTATION PROCESS
Need-based segmentation
Segment identification
Segment attractiveness
Segment profitability
Segment positioning
Segment acid testMarket mix strategy
EFFECTIVE SEGMENTATION CRITERIA
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EFFECTIVE SEGMENTATION CRITERIA
Measurable
Substantial
Accessible
Differentiable
Actionable
PORTER’S 5 FORCES MODEL
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PORTER’S 5 FORCES MODEL
Threat of Rivalry
Threat of SupplierBargaining Power
Threat of BuyerBargaining Power
Threat of
New Entrants
Threat of
Substitutes
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STEPS IN STRATEGIC BRAND MANAGEMENT
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STEPS IN STRATEGIC BRAND MANAGEMENT
Identifying and establishing brand
positioning
Planning and implementing brand
marketing
Measuring and interpreting brand
performance
Growing and sustaining brand value
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THE ROLE OF BRANDS
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THE ROLE OF BRANDS
Identify the maker Simplify product handling
Organize accounting
Offer legal protection
THE ROLE OF BRANDS
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THE ROLE OF BRANDS
Signify qualityCreate barriers to entry
Serve as a competitive advantage
Secure price premium
WHAT IS BRANDING?
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WHAT IS BRANDING?
Branding is endowing
products and services with the
power of the brand.
WHAT IS BRAND EQUITY?
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WHAT IS BRAND EQUITY?
Brand equity is the added valueendowed on products and services,
which may be reflected in the way
consumers, think, feel, and act withrespect to the brand.
ADVANTAGES OF STRONG BRANDS
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ADVANTAGES OF STRONG BRANDS
Improvedperceptions of
product
performance
Greater loyalty
Less vulnerability to
competitive
marketing actions Less vulnerability to
crises
Larger margins More inelastic
consumer response
Greater tradecooperation
Increased marketingcommunicationseffectiveness
Possible licensingopportunities
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WHAT IS A BRAND PROMISE?
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WHAT IS A BRAND PROMISE?
A brand promise is the marketer’s vision ofwhat the brand must be and do for
consumers.
BRAND EQUITY MODELS
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BRAND EQUITY MODELS
Brand Asset Valuator (BAV)
Brandz
Brand Resonance
BAV MODEL
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BAV MODEL
UNIVERSE OF BRAND PERFORMANCE
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UNIVERSE OF BRAND PERFORMANCE
BRAND DYNAMICS PYRAMID
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BRAND DYNAMICS PYRAMID
BRAND RESONANCE PYRAMID
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BRAND RESONANCE PYRAMID
BRAND BUILDING BLOCKS
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BRAND BUILDING BLOCKS
MASTERCARD CREATED AN
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EMOTIONAL BOND TO ITS BRAND
DRIVERS OF BRAND EQUITY
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DRIVERS OF BRAND EQUITY
BRAND ELEMENTS
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BRAND ELEMENTS
Brand names Slogans
Characters
Symbols Logos
URLs
BRAND ELEMENT CHOICE CRITERIA
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BRAND ELEMENT CHOICE CRITERIA
Memorable
Meaningful
Likeable
Transferable
Adaptable
Protectable
SLOGANS
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SLOGANS
Like a good neighbor,State Farm is there
Just do it
Nothing runs like aDeere
Save 15% or more in
15 minutes or less
We try harder We’ll pick you up
Nextel – Done
Zoom Zoom I’m lovin’ it
Innovation at work
This Bud’s for you Always low prices
SECONDARY SOURCES OF BRAND KNOWLEDGE
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SECONDARY SOURCES OF BRAND KNOWLEDGE
INTERNAL BRANDING
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INTERNAL BRANDING
Choose the right moment Link internal and external marketing
Bring the brand alive for employees
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MEASURING BRAND EQUITY
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MEASURING BRAND EQUITY
Brand audits Brand tracking
Brand valuation
THE 10 MOST VALUABLE BRANDS
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DEVISING A BRANDING STRATEGY
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Develop new brand elements Apply existing brand elements
Use a combination of old and new
BRANDING TERMS
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Brand line
Brand mix
Brand extension Sub-brand
Parent brand
Family brand
Line extension
Category extension
Branded variants Licensed product
REASONS FOR BRAND PORTFOLIOS
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BRAND ROLES IN A BRAND PORTFOLIO
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FlankersCash cows
Low-end, entry-level
High-end prestige
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VALUE PROPOSITIONS
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Perdue ChickenMore tender golden chicken at a moderate
premium price
Domino’s A good hot pizza, delivered to your door within
30 minutes of ordering, at a moderate price
COMPETITIVE FRAME OF REFERENCE
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CUSTOMER RATINGS OF COMPETITORS
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DEFINING ASSOCIATIONS
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Points-of-difference
Attributes or benefits
consumers strongly
associate with a
brand, positivelyevaluate, and believe
they could not find to
the same extent with a
competitive brand
Points-of-parity Associations that are
not necessarily unique
to the brand but may
be shared with otherbrands
POINT-OF-DIFFERENCE CRITERIA
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Desirable
Deliverable
Differentiating
POP VERSUS POD
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PERCEPTUAL MAP: CURRENT PERCEPTIONS
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PERCEPTUAL MAP: POSSIBILITIES
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DESIGNING A BRAND MANTRA
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Communicate
Simplify
Inspire
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CONVEYING CATEGORY MEMBERSHIP
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Announcing category benefitsComparing to exemplars
Relying on the product descriptor
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DIFFERENTIATION STRATEGIES
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MEANS OF DIFFERENTIATION
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Employee
Channel
Image
Services
EMOTIONAL BRANDING
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Strong culture
Communication style
Emotional hook
MARKET SHARE, MIND SHARE,
AND HEART SHARE
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AND HEART SHARE
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