www.allitebooks.com Creating Powerful Brands www.allitebooks.com This page intentionally left blank www.allitebooks.com Creating Powerful Brands Fourth Edition Leslie de Chernatony, Malcolm McDonald and Elaine Wallace AMSTERDAM BOSTON HEIDELBERG LONDON NEW YORK OXFORD PARIS SAN DIEGOSAN FRANCISCO SINGAPORE SYDNEY TOKYO Butterworth-Heinemann is an imprint of Elsevier www.allitebooks.com Butterworth-Heinemann is an Imprint of Elsevier The Boulevard, Langford Lane, Kidlington, Oxford OX5 1GB, UK 30 Corporate Drive, Suite 400, Burlington, MA 01803, USA First published 1992 Reprinted 1993, 1994, 1995, 1996, 1997 Second edition 1998 Third edition 2003 Fourth Edition 2011 Copyright Ó 2011 Leslie de Chernatony, Professor Malcolm McDonald and Elaine Wallace Published by Elsevier Ltd All rights reserved The right of Leslie de Chernatony, Professor Malcolm McDonald and Elaine Wallace to be identified as the authors of this work has been asserted in accordance with the Copyright, Designs and Patents Act 1988 No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher Permissions may be sought directly from Elsevier's Science & Technology Rights Department in Oxford, UK: phone: (+44) 1865 843830, fax: (+44) 1865 853333, e-mail: permissions@elsevier.co.uk You may also complete your request on-line via the Elsevier homepage (http://elsevier.com), by selecting ‘‘Customer Support’’ and then ‘‘Obtaining Permissions.’’ Recognizing the importance of preserving what has been written, Elsevier prints its books on acid-free paper whenever possible British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data A catalog record for this book is available from the Library of Congress ISBN: 978-1-85617-849-5 For information on all Butterworth-Heinemann publications visit our Web site at elsevierdierct.com Printed and bound in Great Britain 11 12 13 10 www.allitebooks.com Dedication This book is dedicated to my wife, Carolyn, daughter, Gemma and son, Russell, with love - Leslie de Chernatony Dedicated to all my academic colleagues who have helped me over the years, with thanks - Malcolm H.B McDonald Dedicated to Seán and Ann Wallace, with love - Elaine Wallace This page intentionally left blank Contents ABOUT THE AUTHORS xiii PREFACE xvii HOW TO USE THIS BOOK xxi ACKNOWLEDGEMENT xxv Part Foundations of Brand Management CHAPTER Why it is Crucial to Create Powerful Brands Summary Confusion about What Marketing is The Growing Importance of Intangible Assets Shareholder Valuedadding Strategies 13 What is a Product? 13 The Importance of the Brand 16 Conclusion 24 Building Successful Brands 25 Book Modus Operandi 26 CHAPTER Understanding the Branding Process 27 Summary 27 Brand Success Through Integrating Marketing Resources 27 The Concept of the Brand 29 Characteristics of Brands 34 Brands as Relationship Builders 37 Historical Evolution of Brands 39 Brand Evolution: Distributors’ Brands and Generics 43 Brand Categorisation 45 Brand Consumerisation Spectrum 53 The Value of Brands to Manufacturers, Distributors and Consumers 54 The Importance of Brand Planning 56 The Issues Influencing Brand Potential 58 Conclusions 63 vii viii Contents Marketing Action Checklist 64 Student Based Enquiry 66 Part Brand Management in Different Sectors CHAPTER How Consumers Choose Brands 71 Summary 71 Brands and the Consumer’s Buying Process 72 Extended Problem Solving 74 Dissonance Reduction 79 Limited Problem Solving 82 Tendency to Limited Problem Solving 85 Consumers’ Low Involvement with Brands 85 Consumers’ Need-States 87 Differential Brand Marketing 89 Consumers’ Perceptions of Added Values 91 Brand Information: Quality or Quantity? 96 Clues to Evaluate Brands 97 Brand Names as Informational Chunks 98 The Challenge to Branding from Perception 99 Naming Brands: Individual or Company Name? 103 A Strategic Approach to Naming Brands 106 Brand Name Alternatives Generated 107 Issues Associated with Effective Brand Names 108 The Brand as a Risk Reducer 111 Conclusions 113 Marketing Action Checklist 115 Student Based Enquiry: 117 CHAPTER How Consumer Brands Satisfy Social and Psychological Needs 123 Summary 123 Added Values Beyond Functionalism 124 Brands and Symbolism 127 Self-concept and Branding 131 Brand Values and Personality 133 Brand Personality and Relationship Building 140 The Contribution of Semiotics to Branding 143 Conclusions 147 Marketing Action Checklist 149 Student Based Enquiry: 152 Contents CHAPTER Business-to-Business Branding 155 Summary 155 Brands and Organisational Marketing 156 The Unique Characteristics of Organisational Marketing 163 Nature of Brands in Organisational Markets 166 Who Buys Brands? 167 Anticipating the Role of Buying Centre Members 169 The Organisational Buying Process 171 Brand Values in Business-to-Business Branding 174 Brands as Relationship Builders 177 Factors Influencing Brand Selection 182 Providing Organisational Buyers with Brand Information 188 The Company as a Brand 192 Varying Receptivity to Branding 196 Conclusions 197 Marketing Action Checklist 199 Student Based Enquiry: 201 CHAPTER Service Brands 205 Summary 205 New Ways of Thinking about Services 206 The Challenge of Services Branding 208 Intangibility 209 Heterogeneity 213 Inseparability of Production and Consumption 214 Perishability 216 Moving Beyond the Fast-moving Consumer Goods Model 217 The Process of Building and Sustaining Powerful Services Brands 219 Branding to make Tangible the Intangible 223 Consistent Service Brands through Staff 225 Service Brands with the Optimum Consumer Participation 229 Building Service Brand Equity 233 Conclusions 234 Marketing Action Checklist 235 Student Based Enquiry 236 CHAPTER Retailer Issues in Branding 241 Summary 241 ix This page intentionally left blank Index A AA, see Automobile Association Abercrombie & Fitch, 418 Abranding, 397 Absolut, 103, 127 Accenture, 156, 196, 412 Accounting, 20 Accounting Standards Body, 458 Action brand marketing, 347 Added values, 18, 24, 25, 28, 35, 114, 296, 399, see also Value; Value-added brands from appearance, 93, 373 from beliefs, 375 beyond functionalism, 124 business-to-business brands, 179, 372 central, 381 chain, 377, 378 clarity about, 380 coding of, 387 commodities and, 91 communicating, 355 competition copying, 387 in context of entire firm, 377 through customisation, 391 as differentiating, 380 emotional, 20, 380 equation, 390 from experience, 92, 375 expressive, 381 from extensions, 361 framework, 92 functional, 327, 380 holistic strategy for, 380 identifying, 371, 381, 400 importance of, 20f innovation and, 378 intangible, 372, 377 interpretations of, 374, 375 judged relative to competition, 374 as multi-dimensional concept, 372 noticeably different, 378 overlooked, 114 through participation, 389 perceptions of, 31, 375 personality as, 375 perspective on equity, 448 positioning as, 372 from reference group effects, 92 through relationships, 393 relevant, 378 reputation as, 375 risk and, 329, 380 service brands, 379 shareholder, 11, 12f, 13 shorthand device and, 380 from sorts of people using brand, 375 staff and, 388 symbolism, 128 taken for granted, 374 trademarks and, 380 vision and, 381 welcomed, 378 Adversarial relationship, 141 Advertising, see also Promotion anti-counterfeiting, 397 banner, 299 business-to-business, 188 class, 146 consumer created, 306 consumer mix modeling, 356 costs, 364 creativity, 356 emotions and, 341 perspective of, 45 service brand, 389 starting point for, 356 store brand, 252 symbols, 129 values, 412 Aer Lingus, 214 Affiliate marketing, 298 After Eight, 435 Agreeableness, 142 Airwick Industries, 29 Aldi, 246, 250, 325 Allied Domecq, 466 Amazon, 294, 296, 302, 310 Ambassadors, 195, 229, 341 American Airlines, 244, 386 American Express, 20, 374, 434 Anderson Consulting, 196 Anti-brand sites, 303 complainers, 295 expert, 294 opportunists, 295 symbolic haters, 295 Apple, 28, 58, 142, 184, 228, 295, 298, 306, 327, 354, 355, 361, 381, 392, 396, 428 Arranged marriage, 141 “Arthur Guinness Fund”, 335 Asda, 252 Ashford Castle, 103 ASICS, 311 ASOS.com, 311 Asset development, 20 Asset protection, 20 Aston Martin, 376 Attitude, 86, 140, see also Personality competitor, 344 471 472 Index Attributes, 454 categorisation, 102 information search by processing, 97 Audit, 58, 114, 266, 387, 414, 434, see also Evaluation brand name, 106, 110 Augmentin, 158 Aural signs, 146 Automobile Association (AA), 340, 359 Avis, 385 Awareness, 451 evaluating, 455 from extension, 361 AXA, 103 B Baileys Irish Creams, 361 Balance sheet, 7, 9f, 10f, 458 Bang & Olufsen, 337 Barex, 428 BBG, see British Brand Group Bebo, 31 Beer, 50 Beliefs, 77, 82f, see also Perceptions added values from, 375 image and, 455 Ben & Jerry's, 358, 385 Benefits brand, 330, 332 Bic, 353 Binary oppositions, 146 Black & Decker, 362, 431 Blackberry, 105 Blair Witch Project, 305 “Blue Ocean Strategy”, 385 BMW, 13, 27, 127, 129, 325, 418 Body Shop, 358, 381 Boomerang Principle, 242 Boots, 37, 244, 252 Brand Dynamics, 453 Brand Finance, 459 Brand name, 16, 450 alternatives generated, 107 audit, 106, 110 brainstorming, 108 business-to-business, 159 categorising, 104 company associations with, 104 compatibility, 109 computer-generated, 108 corporate name as, 103, 115, 159 creating new words, 109 creative, 109 criteria specified, 107 distinctive, 109 emotion and, 109 extending stored-up equity, 109 flexibility, 110 group discussions, 108 in-company competitions, 108 as informational chunks, 98 initials, 110 international validity of, 110 on internet, 300 issues associated with effective, 108 judging, 108 legal protection, 109 management inspiration, 108 marketing objectives and, 106 meaningful, 109 neglecting, 17, 18 numbers in, 105 objectives, 107 personality and, 107 positioning and, 107 responses to, 110 screening, 108 selecting, 108 simple, 108 spectrum, 94f strategic approach to, 106 strategy alternatives, 107 word association, 108 Brand Positioning Services, 413 Brand Pyramid, 166f Brand scorecards, 462 developing, 463 example, 464f users of, 463f BrandAsset Valuater, 452 Brands abandoning, 397 acquisition stage, 459 advertising perspective, 45 augmentation level, 34, 383, 400 benefits of, 31 building v buying, 364, 357 capabilities, 46 categorisation, 45 characteristics, 34 commodity v., 18 concept, 29 conspicuous, 125 as data centre, 196 definitions, 31, 166, 372 evolution of, 35, 39, 43, 296f expected level, 34, 383, 400 as functional device, 49 generic level, 34, 382, 400 images surrounding, 124 importance of, 16 information search by processing, 97 input, 30, 46 intangibility of, 8f internet reconceiving concept of, 296 levels, 34, 382f most valuable, 30t, 208 output, 30, 46 potential level, 385 pseudo, 19 as sign of ownership, 48 small firms and, 49 social amplification of benefit and, 124 as strategic devices, 322 triangle, 312 typology, 46f, 48 updating, 127 Branson, Richard, 229 Bridging, 413 British Airways, 27, 58, 143, 352 British Brand Group (BBG), 52 Broad cost brand, 337 Broad differentiation brand, 337 Brochureware, 294 Brook Street, 158 Build-a-Bear workshops, 390 Bulgari, 361 Burberry, 300, 301 Burger King, 33 Business-to-business brand purchasing, 167, 171, see also Buying center central route, 188 eight-step process, 171, 172f, 198 modified rebuy, 173 new task, 173 peripheral route, 188 providing information, 188 straight rebuy, 174 Business-to-business brands adaptation, 180 added value in, 158, 179 advertising, 188 Index alternative comparison level, 180 atmosphere, 178 branding receptive, 197 commitment, 180 cooperation, 180 delivery, 186 differentiation, 184 emotions and, 156, 185, 199 environment and, 178 equity, 161, 194 functional components of, 182, 185 highly tangible, 197 interaction process, 177 interdependence/power, 180 life-cycle, 184 lower cost and, 164 lower prices and, 164 low-interest, 194 loyalty, 164 mutual goals, 180 names, 159 nature of, 166 nonretrievable investments, 180 organisation, 178 partner purpose and, 180 partner search/selection and, 180 performance, 179, 180 price, 184 price premiums and, 183 product type, 183 rational dimension and, 33, 165, 182, 199 relationship building and, 177 reliability, 179 reputation and, 181 risk and, 165, 187 segmentation and, 164 selection factors, 182 selling to different industries, 183 service, 179 setting boundaries in, 180 shared technology, 180 social bonds and, 180 structural bonds, 180 time involvement and, 164 trust, 180 value and, 181 value chain and, 163 values and, 174, 175 varying receptivity to, 174 Business-to-business marketing, 156 importance of brands in, 159 people involved in, 163 unique characteristics of, 163 Buying center, 167, 182, 198, 263 anticipating role of, 169 buyers, 170 deciders, 170 gatekeepers, 170 group dynamics, 171 influencers, 169 membership, 168 monitoring, 168 perceptions, 191 process, 263 users, 161 C Cadbury, 257 Cannibalism, 274 Canon, 326, 339, 359 Capital, cost of, 11 Carphone Warehouse, 106 Carrefour, 44, 246, 253 Categorisation, 53, see also Efficient Consumer Response (ECR) attributes, 102 brand name, 104 brands, 45 consumer, 281, 348 learning and, 102 need-states and, 281 Category management, 272, 283, 285, see also Efficient Consumer Response (ECR) Category Captain, 274 category review, 276 to concentrate on business processes, 274 defining, 273 evaluation, 277 implementation of, 277 improving profits, 275 improving satisfaction, 275 merchandise planning, 276 optimising assortments, 275 optimising new product introductions, 275 optimising promotions, 275 personnel/image and, 275 point of sale quality and, 275 problems in, 277 process, 276f to target consumers, 276 traditional approach v., 273t using information in, 275 Caterpillar Corporation, 187, 372 Cattle farming, 39 Chanel, 247, 431, 460 ChemStation, 392 Childhood friendship, 141 Children, targeting, 274 Cirque du Soleil, 386 Citibank, 329 Clark, Kimberley, 429 Clifton, Rita, 11 Closure, 103 Club Med, 224, 230 Coca-Cola, 16, 33, 130, 159, 257, 258, 273, 304, 333, 448, 460, 462 Coherence, 312 Colgate, 414, 434 Collaboration, 281 Commercial sign, 143 Commodity, 259, 330, 332 added values and, 91 brand v., 18 service brands and, 223 slide, 17 Competition, 52, 62 added values judged relative to, 374 attitude, 344 benchmarking against, 333 copying, 252, 340, 381, 387, 428 data on, 345 evaluating, 344 grouping, 344 history and, 344 minimal differences in, 85 perceptions of, 343, 344 positioning, 385 protecting against inferior, 430 response, 63, 343, 358, 364 service brands and orientation on, 340 switching between, 177 value chain of, 336 Competitive advantage, 209, 363, 460 capitalising on, 336 consistency and, 338 consumer focus and, 209 473 474 Index Competitive advantage (Continued ) core competencies and, 339 corporate identity and, 193 developing, 323 drive for results and, 209 emotions and, 341 emulating, 338 focusing, 336 identifying sources of, 333 integration and, 339 knowledge and, 307 management and, 218 reinforcing, 336, 339 scope of, 336 service and, 343 service brands and, 209, 340 sustaining, 337 systems thinking and, 339 teamwork and, 339 technology and, 209, 338 vision and, 209 Computers, 35 Conscientiousness, 142 Constitutive utility, 322 Consumerisation spectrum, 53, 54f Consumers, 54, 61, see also Efficient Consumer Response; Perceptions apathetic, 348, 346 appreciation of service brands, 234 associations with successful brands, 353 benefits, 14 buying process, 72 categories, 276, 281, 348 category management targeting, 276 competitive advantage and focus on, 209 confidence, 124 consumer contact, 215, 297 as co-producer, 207, 214, 230, 235, 305, 306 decision processes, 74f doubter, 348 economist's view of, 72 functional capacities focusing on, 49 interviews, 350, 436 involvement of, 72, 85, 114 job of, 230 loyalist, 348 misbehavior, 232, 235 mix modeling, 356 motivation and financial service brands, 218 response perspective on equity, 448 risk dimensions and, 113 risk types and, 113t satisfaction, 35 segmentation, 90 service brands and orientation on, 340 shift to shopper loyalty from loyalty of, 283 store brands and behavior of, 248 store brands targeting specific segment of, 248 swinger, 348 talking to v listening to, 308 tracking lost, 90 value, value perspective, 426 Contrast pairs, 146 Control, 358 Converse, 35 Co-op Bank, 297 Cooperative Bank, 59, 104 Cordiant, 460 Core competencies, 339 Corporate brand, 192 network role related perceptions of, 192 offering related perceptions of, 192 personal contacts related perceptions of, 192 purpose of, 192 Corporate identity, 193 advantages of, 195, 196 Communication Station, 194 competitive advantage and, 193 Creativity Station, 194 Critical Triplet Station, 194 Head Station, 193 Human Power Station, 194 limitations, 196 six station model, 193, 194f, 195, 199 Strategy Station, 193 supporting resources for, 193 Cost-driven brands, 324, 363 creativity and, 326 profit margin, 324 quality of, 325 risk, 326 strategy, 326 value-added brands with characteristics of, 330 Counterfeit brands, 395, 400 advertising, 397 benefits of, 395 deceptive/non-deceptive, 397 defining, 395 as epidemic, 396 global market for, 395 internet and, 396 negative consequences of, 395, 397 preventing, 396 reasons for purchasing, 397 responses to, 397 Courtship, 141 Courvoisier, 466 Creativity advertising, 356 brand name, 109 cost-driven brands and, 326 service brand, 212 CRM, see Customer relationship management Culture differences, 59, 341 extension and, 362 internal, 341 matching, 58 symbols and, 130 value and, 379 Customer relationship management (CRM), 244 Customisation adaptive, 392 added values through, 391 approaches to, 392f collaborative, 392 cosmetic, 393 transparent, 392 D Data mining, 244 De Chernatony - McWilliam Brand Planning Matrix, 418 strategies from, 421 Death, 322, see also Failure implications, 432 managerial responsibility for, 431 Dell, 103, 301, 302, 311, 327 Dell, Michael, 103 Index Delta Airlines, 227 Dependency, 141 interdependence, 271 mutual, 271 DHL, 230 Diageo, 253 Differential marketing, 89 business-to-business, 184 Differentiating, 39, 41, 48, 49, 49f, 74, 80, 125, 372, 377, 382, 383 as added value, 380 feature, 251 financial service brands, 218 price, 451 profit, 89 quality, 251 rewards on internet, 301 service brands, 221, 233 store brands and, 251 value-added brands, 329 Dimensions, 415 Discounters, 250 Disney, 45, 208, 226, 296, 336, 343, 352, 381 Dissonance reduction, 79, 80f Distribution data, 458 Distribution performance, 175, 176t Distributors, 43, 54, 56, 60 “Doctor Who”, 374 Dolce and Gabbana, 300 Domestos, 91 Dominance, 456 retailers, 284 social communities, 306 Dove, 33, 352 Drugs, 124 Dunnes Stores, 399 Duracell, 45, 385 Dynamic scenario analysis, 465 E Earning split approach, 462 easyJet, 325 eBay, 224, 307, 309 E-commerce, 22, 23, 293 information search and, 95 Economic substitution analysis, 461 Economic use valuation method, 461 Economies of scale, 343, 349 ECR., see Efficient Consumer Response Efficient Consumer Response (ECR), 277, 283, 285 advantages of, 279 collaboration and, 281 evolution of, 278 implementation of, 280, 283 key elements in, 277 maximising category development with, 281 measuring success of, 282 principles of, 280 relationships in, 278 scorecard, 282f, 282, 282, 285 trust and, 281 value of, 279 Egan, John, 349 Eircell, 106 Eli Lilly, 156 E-marketing, 293 Emotional values, 31, 41, 125, 139, 296, 415 as added value, 20, 380 advertising and, 341 brand name and, 109 business-to-business brands and, 199, 156, 185 competitive advantage and, 341 contagion, 215 equity and, 311 evaluation, 453 labour, 215 packaging and, 341 positioning, 127 service brands and, 215, 233 values, 139 Encyclopedia Britannica, 14 Engagement, 244 Enslavement, 141 Environment, 36 analysing, 323 business-to-business brands and, 178 macro, 63 profitable brands capitalising on, 351 symbols and, 130 value and, 379 Equity, 312 brand name extending stored-up, 109 business-to-business brands, 197, 161 causal nature of, 454f challenges, 448 consumer response perspective, 448 defining, 448 elements of, 310 emotional connection and, 311 evaluation, 454 evolution of, 450f financial effect of, 448f, 448 financial perspective, 448 growing, 447 internet and, 311 interpretations of, 448 leveraging off historical, 449 monitoring sources of, 353, 454 order fulfillment and, 311 responsive service nature and, 311 service brand, 233 tracking, 450 trust and, 311 value-added perspective, 448 Esteem, 452 Evaluation, 35, 456, see also Value assumptions, 459 attractiveness, 265, 266 awareness, 455 category management, 277 clues, 97 competition, 344 components, 413, 414 emotional components, 453 equity, 454 estimations, 459 financial, 458, 461 functional components, 453 historic costs, 461 image, 455 leadership, 457 loyalty, 457 organisational associations, 456 personality, 456 perspectives, 460 power, 267t price and, 35 purchase, 82f, 78, 82 quality, 417, 418, 456 service brands, 215 strength, 265, 266, 257 surrogate attributes and, 97 Evian, 415 Expectancy-value model, 72 Experience, 33 Experiential brands, 418 475 476 Index Extension, 55, 322, 358, 452 awareness from, 361 benefits from, 361 brand associations from, 361 through companion product, 359 culture and, 362 damage from, 362 through designer status, 359 disasters from, 362 through distinctive taste/ component, 359 encouraging trial purchase, 361 through expertise, 359 forward spillover, 358 image and, 359 name confusion from, 361 negative associations from, 361 no added value from, 361 quality associations from, 361 quality deterioration from, 362 reciprocal spillover, 358 risk and, 359 through same franchise, 359 through same product in different form, 359 strategy, 359 types, 359 unacceptable, 363 undesirable associations from, 362 through unique benefit/attribute/ feature, 359 through values, 412 weaknesses from, 361 Extroversion, 142 F Facebook, 227, 392 Failure, 3, 427, see also Death Familiarity, 452 FAQ, see Frequently Asked Questions Fashion, 300 Fast moving consumer goods (FMCG), 205 adapting, 218 success and, 248 Federal Express, 228, 230, 323, 343 Financial bonds, 37 Financial perspective, 426 equity, 448 Financial Reporting Standard 10, 458 Financial service brands, 209, 217 consumer motivation and, 218 differentiation, 218 online, 218 product benefit, 218 product definition, 218 strength, 218 trust and, 218 Fire fighting, 57 First Direct, 128, 232 Flash mob, 305 Fling, 141 FMCG, see Fast moving consumer goods Focus cost brand, 337 Focus differentiation brand, 337 Ford, 271, 346, 385, 459 The Four Seasons, 333 Frequently Asked Questions (FAQ), 310 Functional communication, 41 Functional components, 137, 381, 383, 413, 414, 415, 417, 438, 439 added values, 327, 380 added values beyond, 124 advantage, 125 of business-to-business brands, 182, 185 evaluation, 453 focusing on consumers, 49 Functionality, 419 high representationality and high, 421 high representationality and low, 422 low representationality and high, 422 G GAP, 432 General Electric, 460 General Motors, 103, 326 Generics, 34, 43, 253, 382, 400 price of, 44 promotion of, 253 quality of, 253 weakening profits, 253 Geo brands, 412 Gestetner, 14 Gillette, 6, 12, 17, 434 GlaxoSmithKline, 159, 411 Gold, 143 Golf, 129 Goodyear, Mary, 53 Google, 29, 53, 208, 228, 232, 294, 358, 377, 462 Gordon, Wendy, 88 Grand Metropolitan, 17 Green & Black, 36, 91 Green Shield Stamps, 244 Greenwashing, 158 Grimes, Herbert, 449 Guarantees, 39 The Guardian, 130 Gucci, 397 Guinness, 124, 334f Guinness, Arthur, 335 H Halifax, 415 Halifaxshoppingextra.co.uk, 308 Hanson, Doughty, 449 Harlem Globetrotters, 435, 436 Harley Davidson, 127, 142, 304 Harley Owners Group (HOG), 124, 127, 304 Harrods, 241 Harrods' Food Hall, 327 Haus of Gaga, 434 HBO, 418 Head and Shoulders, 432 “Hedgehog Concept”, 354 Heinz, 257, 339 Heritage brand, 335 Hermés, 419 Hertz, 385 Heuber, Max, 359 Highland Spring, 448 Hilton, 91 Hitachi, 460 H&M, 242, 247 HMV, 224 HOG, see Harley Owners Group Holiday booking, 21f, 22f, 23, 23f, 24f Honda, 385 Hoover, 434 Hovis, 37, 434, 449 Howard Johnson, 357 Human Resources function, 412 I IBM, 14, 20, 372 ICI, 429 Identity, 408, see also Corporate identity Index iDNation, 306 IKEA, 230, 242, 247, 338, 339, 389, 390, 408 iLounge, 396 Image, 124, 193, 387, see also Attitude; Personality associations, 455 belief ratings, 455 category management and, 275 evaluation, 455 extension and, 359 projective techniques for measuring, 455 qualitative techniques for measuring, 455 reinforcing, 439 service brand, 363, 389, 388 value, 379 value-added brands, 327 Imperial Group, 359 Infomediaries, 307 Information encoding, 98 Information search, 56, 76, 77 extent of, 93 external, 94, 95 internet, 95, 298, 300 by processing attributes, 97 by processing brands, 97 quality v quantity, 96 reasons for limited, 96 risk and, 95 selectivity and, 99 Information structure, 146 ING, 218 Innovation, 378, 428, 429 added values and, 378 source of, 429 Institute of Grocery Distribution, 30 Insurance, 14 Intangibility, 6, 8f added values and, 372, 377 breakdown, made tangible, 223, 234 selected economies and, 8f service brands, 209, 223, 234 Intel, 158 Interbrand, 381, 459 Interflora, 129 Intermarche, 246 Internal/external process perspective, 426 Internet, 22, 254, 293, see also Social communities; Web 2.0 acquisitions, 358 brand evolution on, 296 brand name, 300 challenges and, 307 communication and, 304 comparison shopping, 308 cost savings, 295 counterfeits and, 396 differential rewards on, 301 download speed, 298, 300 enacting promises on, 299f equity and, 311 evolving role of, 303 financial service brands and, 218 information search, 95, 298, 300 international markets and, 309 linked sites, 298 luxury fashion labels on, 300 migrating to, 300 navigation, 301 as opportunity, 303 personal support, 302 physical delivery and, 302 pricing and, 309 reconceiving concept of brand, 296 returns and, 302 service, 310 shifting power, 307 site appearance, 300 speech equality, 294 as threat, 303 transparency, 303 Internet Explorer, 450 IS10668, 459 J Jacobs Suchard, 29 Jaffa Cakes, 376 Jaguar, 349, 459 Jif, 361 Jimmy Choo, 35 Jobs, Steve, 354 Johnson & Johnson, 29, 59, 380 K Karen Millen Ltd, 399 Kelkoo.co.uk, 308 Kellogg's, 52, 103, 273, 283, 344, 395, 435 KFC, 214 Kinship, 141 Kleenex, 429 Knowledge, 455 competitive advantage and, 207 Kotler, Phillip, Kraft, 17, 359 L Lagerfeld, Karl, 247 Laker, Freddie, 10 Launch, 424, 450, 451 challenges to, 410f risk, 425 Leadership, 422 Learning curve, 343, 349 Lee, Spike, 33 Legal protection, 39, 41, 52, see also Trademarks added values and, 380 brand name, 109 Lego, 430 Levi Strauss, 127, 361, 396 Levitt, Theodore, 14 Lidl, 246, 250, 325, 376 Life cycle business-to-business brands, 184 decline phase management, 431 financial implications during, 433 growth phase management, 430 managing over, 424 maturity phase management, 431 Linguistic signs, 146 Loctite, 191 L'Oreal, 358 Lotus, 327 Louis Vuitton, 300, 396, 397 Loyalty, 13, 37, 78, 88, 89, 348, 409, 427, 451 business-to-business brands and, 164 demand and, 89 evaluation, 457 programs, 244, 246 reputation and, 341 shift from consumer loyalty to shopper, 283 store brand, 244 Lucozade, 411 M MacRumors, 355 Manchester United, 37 477 478 Index Manufacturers, 54 balance of power between retailers and, 269, 285 invitation to become store label supplier, 258 offensive strategy, 264 portfolio, 265 quality of, 261t, 261 responses to retailers, 255 store brands v., 258f, 284, 267 strong, 258f weakening of, 256f Market share, 346, 458 components, 347 store brands, 250 strategic meaning of, 347f strength and, 343 Marketing, see also specific marketing types action checklist, 64, 115, 149, 199, 235, 285, 312, 364, 401, 440, 467 brand name and, 106 components, confusion, definitions, 6, foundation, 15 Integrating resources, 27 mix modeling, 464 process, relationship, 37 store brands, 241 Marketing map, needs-based, 17f product-based, 16f summary, 5f Marketing Science Institute, 448 Marks & Spencer, 145, 252, 255, 270, 271, 327 “Marlborough Friday,”, 35 Mars, 257, 258, 395, 429, 457 Maxwell Housedrip, 129 M&C Saatchi, 460 McDonalds, 208, 228, 324, 343, 361 McDougal, Rank Hovis, 29 McKinsey, 228 Memory, 93, 94, see also Recall time and, 101 Mercedes, 103, 184, 352, 419 Metro, 246 Michelob, 352 Microsoft, 304, 358 Mini, 306 Minolta, 425 Möet & Chandon, 129 Momentum design, 354, 355f execution, 354, 355f success requiring, 354 Monetary Brand Valuation, 459 Motivational needs, 383 Myth, 144 diagram, 144 signs, 143 N National University of Ireland Galway, 301 Need-states, 87, 114 dictating category definitions, 281 Negative advocacy, 33 Negative Double Jeopardy, 394 Nescafé, 129, 333, 435 Nespresso System, 429 Nestlé, 29, 257, 429, 458 Netto, 325 Neuroticism, 142 New York Times, 428 Nike, 59, 103, 306, 339, 351, 374, 380, 418, 426 Nintendo Wii, 37 Nissan, 385 Nokia, 33 Non-verbal statements, 124 Nordstrom, 228 North Face, 128 Novex, 158 Nurofen, 385 Nutella, 304, 305 O O2, 227 Obama, Barack, 147 Olay, 430 Omega, 129 Openness, 142 Operational effectiveness, 337 Oral B, 359 Organisational associations, 456 Organisational marketing, see Business-to-business brands P Pampryl, 428 Panasonic, 337 Pantene, 274 Paris Miki, 392 Parry, Michael, Participation added values through, 389 optimizing, 229 service brands and, 229, 389 in social communities, 305 Passive brand marketing, 347 PayPal, 224, 302 Pepsi-Cola, 16, 257, 448 Perceptions, 20, 46, 99 of added values, 91, 375 buying center, 191 of competition, 343, 344 of corporate brand, 192 defense, 101 organisation, 101 process, 29 of quality, 350, 439, 456 of risk, 111, 115 selectivity, 96, 100 of value, 352, 428, 451, 456 of values, 408 vigilance, 101 Performance, 175f, 176t attachment and, 424 business-to-business brands, 179, 180 comparative advantage and, 424 comprehension and, 424 determining, 424 distribution, 175, 176t history and, 424 interpersonal relatedness and, 424 preference and, 424 product, 175, 176t quality, 417 risk, 112 support services, 175f, 176t Pernod Ricard, 428, 466 Perrier, 415 Persil, 33, 362, 359 Personality, 92, 133, 140, 148, 387, 415, 437 as added value, 375 brand name and, 107 competence, 92 evaluation, 456 excitement, 92 influences on, 137 Index positioning, 385 relationship and, 142 ruggedness, 92 sincerity, 92 sophistication, 92 Peters, Tom, Philip Morris, 17 Philips, 361 Pierre Cardin, 361 Pilsbury, 97 PIMS database, see Profit Impact of Market Strategies database Pioneers, 427 Planning, 56 Polaroid, 434 Polycell, 431 Porsche, 327 Porter, Michael, 465 Portfolio manufacturers, 265 successful brands and hierarchy of, 352 Positioning, 414, 437, 450 as added value, 372 aural signs and, 146 binary oppositions and, 146 brand name and, 107 communication codes and, 146 competitor, 385 contrast pairs and, 146 decoding, 146 emotional, 127 end user, 385 implied situation and, 146 information structure and, 146 linguistic signs and, 146 personality, 385 refining, 86 service and, 343 service brands, 221 specific attribute, 385 store brands, 251 successful brands and, 352 textual structure and, 146 total, 324 use, 385 using discriminating factors, 383 visual emphasis and, 146 visual signs and, 146 Post-it, 450 Potential, 34 influences on, 58 level, 385 Power balance between manufacturers and retailers, 269, 285 business-to-business branding and, 180 coercive basis for, 270 continuum, 270f evaluation, 267t expert, 270 internet shifting, 307 legitimate, 270 referent, 270 retailer, 60, 61t, 271 reward, 271 supplier, 271 Power brands, 332, 333 Prada, 419 Premier Inn, 325 Price premiums, 457 business-to-business brands and, 183 legal restrictions, 457 Pricerunner.co.uk, 309 Pricescan.com, 309 Pricing international markets and, 309 internet and, 309 on perceptions of value, 352 Problem recognition, 82f, 76, 82 Problem solving extended, 74 limited, 82f, 82, 85 routine, 76f, 78f Procter & Gamble, 6, 7t, 12, 17, 272, 274, 278, 280, 281, 344, 353 Product, 13 based market map, 16f business-to-business, 183 category management optimising, 275 central role of, 13 extension through companion, 359 extension through same, 359 financial service brand benefit, 218 financial service brand defining, 218 management, 13 marketing map based on, 16f performance, 175, 176 as problem solver, 14 store brands specifications, 252 surround, 15, 16, 20 Productivity brand, 332, 333 Profit Impact of Market Strategies database (PIMS database), 25, 346, 349 Profit matrix, 90f Profitable brands, 349, 364 capitalising on environment, 351 confidence in, 350 factors impacting, 351 as leaders, 349 quality of, 350 Promises, 33, 408 on internet, 299f site appearance and, 300 Promotion, 21, 35, 80, 83, 355 category management optimising, 275 generics, 253 service brand, 212 Prosumer, 390, 391 Prozac, 159 Psychological components, 413, 414 Publishers, 15 Purchase, 82f, 77, see also Businessto-business brand purchasing; Buying center alternative evaluation, 82 evaluation, 82f, 78 Extension encouraging trial, 361 low involvement, 83 regular, 83 Pyrotenaz, 158 Q Quaker Oats Ltd, 459 Quality aesthetics, 417 assessing, 350 associations from extension, 361 assurance, 417 business-to-business brands, 179 category management and, 275 conformance to specification, 417 of cost-driven brands, 325 deterioration from extension, 362 differentiating, 251 durability, 417 empathy, 417 evaluating, 417, 418, 456 features, 417 of generics, 253 479 480 Index Quality (Continued ) Information search and, 96 manufacturers, 261, 261t perceived v actual, 350 perception of, 350, 439, 456 performance, 417 profit and, 436 of profitable brands, 350 reliability, 417 reputation, 417 responsiveness, 417 service brand, 417 serviceability, 417 store brand, 251 tangible, 417 Quinn, Senator Fergal, 242 R Radiohead, 295 Rational component, 297, 415, see also Functional components business-to-business brands and, 33, 165, 182, 199 Ray-Ban, 381 Recall, 455 Reckitt & Colman, 29 Reclamation, 397 Recognition, 455 Red Bull, 411 Red Crescent, 130 Red Cross, 130, 376 Reference brand, 158 Relationships, 37, 140, 148, 437, see also Customer relationship management added values through, 393 adversarial, 141 business-to-business brand, 177 casual friendship, 141 close friendship, 141 committed partnership, 141 compartmentalised friendship, 141 in Efficient Consumer Response, 278 episodes, 393, 394 good, 142 long-term, 394f marketing, 37 marriage of convenience, 141 personality and, 142 rebound, 141 reputation and, 341 secret affair, 141 in social communities, 304 as strategic alliance, 271 types, 140 Relevance, 452 Renault, 385 Repeat buying behaviour, 374 Representational needs, 438, 439 Representationality, 419 high functionality and high, 421 high functionality and low, 422 low functionality and high, 422 low functionality and low, 422 Reputation as added value, 375 as barrier against competitor copying, 340 business-to-business brands and, 181 defining, 340 improving, 351 loyalty and, 341 quality, 417 relationships and, 341 Resale price maintenance, 254 Retailers, 43, see also Store brands attractiveness, 265, 266 balance of power between manufacturers and, 269, 285 dominance of, 284 efficiency of, 254 increasing power of, 254 manufacturers response to, 255 multiple, 255f power, 60, 61t, 271 primary, 266 prioritising investment through different, 264 selecting store label suppliers, 262 support for store brand, 250 Revitalising, 434, 439 systematic approach for, 435 Revlon, Charles, 129 Revlon Inc., 129 RHM, 17 Risk, 10, 111 added values and, 380 added-values and, 329 business/financial, 10f business-to-business brands and, 165, 185, 187 career advancement and, 169 consequences, 111 consumers' views on dimensions of, 113t consumers' views on types of, 113t cost-driven brand, 326 extension and, 359 financial, 112 growth and, 13 information search and, 95 launch, 425 objective, 111 perceptions, 111, 115 performance, 112 personal information and, 187 psychological, 112 reducing, 11, 51 return and, 11f, 13 social, 112 strategies, 187 time, 112 uncertainty, 111 Rituals, 129 in online social communities, 303 Rochdale Pioneers, 244 Roddick, Anita, 358 Rolex, 362, 397 Rollercoaster.ie, 308 Rolls Royce, 103 Rowntree, 29, 458 Royalty relief approach, 461 Ryanair, 223, 325 S Saab, 359 Saatchi, Maurice, 460 Saatchi & Saatchi, 460 Sainsburys, 248, 252, 254 Sales support, Salience, 86 Samsung, 337 Santander, 415 Saturn, 142 Saxa, 382 Schweppes, 434 SCR, see Share of Category Requirement Segment perspective, 426 Selection, 61 Selective attention, 100 Selective comprehension, 100 Selective exposure, 100 Selective retention, 101 Index Self-concept, 131, 148 actual, 131, 132 appropriate, 132 debate, 132 forming, 131 ideal, 131, 132 situational, 132, 133f undesired, 132 Selfridges, 241 Semiotics, 143, 148 Seroxat, 159 Service brands, see also Financial service brands; Service recovery; Staff abstract, 211 added value in, 379 advertising, 389 annual statement, 212 appearance, 227 assurance, 227 augmented service offering, 388f, 388 basic service package, 387, 388 building/sustaining powerful, 219 challenges, 208 cog wheel, 219, 220f commodities and, 223 communication system, 388 competitive advantage and, 209, 340 competitor orientation of, 340 considering feasibility of, 220 consumer appreciation of, 234 consumer co-creation of, 214, 235 consumer orientation of, 340 consumer-consumer contact and 215 creativity of, 212 credence qualities, 211, 212f cues, 211 defining, 220 demonstrations, 212 design, 224 determining own fame, 233 differentiating, 221, 233 emotions and, 215, 233 empathy, 227 ensuring internal commitment, 221 equity, 233 evaluation, 215 experience qualities, 211, 212f foundational premises, 206 growth, 223 heterogeneity of, 213 history, 340 identifying external opportunities, 219 identifying internal capabilities, 220 image of, 350, 388, 389 indirect exchange, 206 inseparability of production and consumption, 214 intangibility of, 209, 233, 234 internalising, 234 market testing, 221 moods and, 215 new ways of thinking about, 206 operationalisation, 221 optimizing participation, 229 participation and, 389 perishability of, 216 physical elements of, 223 positioning, 221 promotions, 212 pure, 208, 209 quality, 417 reliability, 227 responsiveness, 227 search qualities, 211, 212, 212f service concept, 387 structural organisational resources, 221 successful, 221 trust and, 212, 223 value, 207 waiting time and, 216 Service recovery, 226 accountability, 226 fairness, 226 learning, 227 paradox, 226 promptness, 226 7-Eleven, 224 S&H Pink Stamps, 244 Share of Category Requirement (SCR), 457 Share of voice (SOV), 356 Shaw, George Bernard, 429 Shelf allocation models, 277 automating, 277 Shields, Aaron, 59 Shorthand device, 39, 41, 52 added values and, 380 Signaling, 397 Sinclair Spectrum, 322 Singapore Airlines, 355 Sketchers, 128 Skoda, 28, 362 Smith, Richard "Stoney,", 449 Snap-on Tools, 323 Social bonds, 37 business-to-business brands and, 180 Social communities, 303 characteristics of, 303 consciousness of, 303 dominating, 306 host, 306, 307 moral responsibilities, 304 participation in, 305 relationships in, 304 rituals, 303 submitting in, 306 Socio-cultural sign, 143 Sony, 59, 333, 337, 425 Southwest Airlines, 427 SOV, see Share of voice Staff, 208, 213, 214, 234 added value and, 388 adopting values, 412 compromising, 225 consistency of, 225 heroism, 225 recruitment of, 228 retaining best, 229 saboteurs, 227, 234 support systems, 229 training, 228 Starbucks, 33, 233, 418 Stock Exchange, 11 Store brands, 242, 247, 283, 284 advertising campaigns, 252 basic market conditions and, 241 building engagement, 244 competitive strategy, 241 consumer behavior and, 248 copy-cat, 252 covering overheads, 260 defending against, 268 differentiation, 251 economic cycles and, 248 elite, 246 feature differentiation, 251 financial results and, 241 increasing profits, 261 internationalisation of, 246 481 482 Index Store brands (Continued ) lifestyle, 284 loyalty to, 244 manufacturer brands v., 258f, 267, 284 market share, 250 market structure, 241 optimizing, 251 package design, 252 positioning, 251 price gap, 269 product specification, 252 profit of, 268 providing basis for growth, 260 quality differentiation, 251 rating, 242 retailer support for, 250 sample of, 248t targeting specific consumer segments, 248 as upstream integration, 247 Store label supplier considerations for assessing, 262 economics of, 258 fear and becoming, 268 financial viability of, 268 horizontal integration of, 263 internal integration of, 263 manufactures invited to become, 258 motivation for, 259 production levels, 259 retailers selecting, 262 strengths of becoming, 268 vertical integration of, 263 weaknesses of becoming, 268 Strand, 100 Strategic perspective, 36 Strategic planning, Strategic Planning Institute, 436 Strategy determination, Strategy development, 58 Strength of becoming store label supplier, 268 evaluation, 265, 266, 457 financial service brand, 218 market share and, 345 Structural bonds, 37 business-to-business brands and, 180 Structural brands, 45 Stuart, John, 459 Successful brands, 19, 25, 308, 438 characterising, 351 consistency of, 352 consumer associations with, 353 coordinating support, 352 criteria, 31t defining, 158 delivering welcomed benefits, 322, 351 fast moving consumer goods and, 248 internal hindrances to, 57 long term support, 353 measurements by, 353 momentum of, 354 monitoring equity sources, 353 portfolio hierarchy, 352 positioning of, 352 pricing on perceptions of value, 352 recruitment of, 353 service brands as, 221 staying relevant, 352 store brand as, 248 Superquinn, 227, 242 Support services performance, 175f, 176t Sustainability, 374 Sutherland, Alec, 306 Swatch, 457 Symbol brands, 43, 50 Symbolic utility, 322 Symbolism, 50, 147, 127, 415 added values of, 128 advertising and, 129 as communication devices, 129, 130 culture and, 130 cyclical process of, 127 environment and, 130 influences on, 128 packaging and, 129 ritual and, 129 social settings and, 129 visual representations and, 128 T Tactical implementation, Taste tests, 93t, 448 TelePresence, 158 Tesco, 19, 43, 227, 244, 246, 247, 248, 252, 253 Textual structure, 146 Thomas Cook, 22 Thompson, Diane, Tiffany & Co., 127 Timex, 362 Ting Hsin International Group, 246 T-Mobile, 305 Topshop, 247 Toyota, 352 Trademarks, 39, 52, see also Legal protection added values and, 380 Travelodge, 325 Travelsupermarket.com, 308 Tribes, 341 Triumph, 322 Trust business-to-business brands and, 180 Efficient Consumer Response and, 281 equity and, 311 financial service brands and, 218 service brands and, 212, 223 TWA, 322 Twitter, 233 Tylenol, 460 Tyler, Richard, 227 U UEFA Champion's League, 130 Unilever, 257, 344, 352, 356, 358 Usage, 61 Utilitarian sign, 143 V Value, 456, see also Added values business-to-business brands and, 181 conceptions of, 375, 376 consumer, consumer perspective, 426 creation cycle, 376, 377f, 377 cultural, 379 environmental, 379 exchange, 379 image, 379 long term, 351 perceptions, 428, 451, 456 pricing on perceptions of, 352 service brand, 207 social, 379 use, 379 Index Value chain, 59, 355f, 363, 377 added, 377, 378 business-to-business brands and, 163 competition, 336 disadvantage of, 336 managers and, 336 stages, 333 Value proposition deliver, determine, Value-added brands, 324, 327, 363, see also Added values with cost-driven characteristics, 330 differentiation of, 329 functional excellence of, 327 image, 327 price, 327 risks, 329 Values, 133, 408, 438 advertising, 412 artifacts to illustrate, 412 behaving in-line with, 412 business-to-business brands and, 174, 175f choice and, 139f clarity of, 412 components, 174 conditional, 139 consistency of, 411 convenience, 144 critical, 144 cutting back on investments and, 413 defining, 135 diversionary, 144 epistemic, 139 extensions through, 412 internalising, 412 maintaining, 409 perception of, 408 related to organisation, 408 social, 139 “speaking,”, 408 staff adoption of, 412 statement, 409, 411 summarising, 408 utopian, 144 Vandalism, 57 Viral marketing, 305 Virgin, 10, 54, 223, 229, 380 Vision, 56 added values and, 381 competitive advantage and, 209 Visual emphasis, 146 Visual signs, 146 Vitality, 452 Vodaphone, 106 Volkswagen, 28, 362, 426 Voluntary brands, 43 W Waiting time, 216 entertaining during, 216 establishing first-come first-served rule to deal with, 217 explaining, 217 information during, 217 reassurance during, 217 starting process during, 217 Wal-Mart, 223, 246, 247, 278 Web 2.0, 303 WeddingGuideUK.com, 308 Weetabix, 104 Weight Watchers, 297 Whirlpool, 361 X Xbox Live, 304 Xero, 158 Xerox, 326 Y Yahoo!, 294 YouTube, 33, 305, 306, 425 Yves Saint Laurent, 103 Z Zantac, 191 483 This page intentionally left blank .. .Creating Powerful Brands www.allitebooks.com This page intentionally left blank www.allitebooks.com Creating Powerful Brands Fourth Edition Leslie de Chernatony,... the Brands Battle How Powerful Brands Beat Competitors 321 Summary 321 Contents Brands as Strategic Devices 322 Cost-driven or Value-added Brands? 324 Value-added Brands. .. Building Successful Brands 25 How brands encapsulate the value -creating capabilities of an organisation 25 Book Modus Operandi 26 Further Reading 26 Creating Powerful Brands DOI: 10.1016/B978-1-85617-849-5.10001-7