Marketing II Session 2 10 03 2015

Marketing II / Session 2 10. 03. 2015 Martin Samek martin. samek@lbs. ac. at

Brand Lauder Business School Marketing II/ Session 1 2

Why BRANDS? (1) v. Brands might have value above and beyond the benefits of the product itself. v. Brands are a portfolio of qualities associated with the name. v. Brands are a visual manifestations. (Logo, shape, font, etc. ) v. Brands trigger associations. 3 Lauder Business School Marketing II / Session 2

Why BRANDS? (2) For the customer: v Brands convey information v Brands signal consistent quality v Brands confer status v Brands reduce customer risk v Brands make purchasing decisions easier. 4 Lauder Business School Marketing II / Session 2

Why BRANDS? (3) For the company: v Brands enhance loyalty v Brands allow charging of premium prices v Brands inoculate the company from some competitive action v Brands assist in segmentation, targeting and positioning v Brands encourage channel partners’ support 5 Lauder Business School Marketing II / Session 2

Brand Name conveys information (? ): 6 Lauder Business School Marketing II / Session 2

Logos and Color vcreate familiarity vsupport the brand name vlet customers draw associations vpick up the company’s positioning v… 7 Lauder Business School Marketing II / Session 2

Brand associations Hierarchy of brand associations: 1) Product attributes 2) Product benefits 3) Emotional benefits 8 Lauder Business School Marketing II / Session 2

Brand personality Aaker (1997) 9 Lauder Business School Marketing II / Session 2

Branding Strategies Umbrella Brands 10 Lauder Business School Marketing II / Session 2

Branding Strategies House of Brands 11 Lauder Business School Marketing II / Session 2

12 Lauder Business School Marketing II / Session 2

Branding Strategies Co-branding Breitling & Bentley Adidas & Goretex 13 Lauder Business School Marketing II / Session 2

Branding Strategies Luxury Brands: What is luxury? A definition “The state of great comfort and extravagant living: he lived a life of luxury” “An inessential, desirable item that is expensive or difficult to obtain: luxuries like raspberry vinegar and state-of-the-art CD players he considers bananas a luxury” (Oxford Dictionaries, 2015) 14 Lauder Business School Marketing II / Session 2

Branding Strategies Luxury Brands: What is luxury? A definition “The state of great comfort and extravagant living: he lived a life of luxury” “An inessential, desirable item that is expensive or difficult to obtain: luxuries like raspberry vinegar and state-of-the-art CD players he considers bananas a luxury” (Oxford Dictionaries, 2015) “Luxury brands are regarded as images in the minds of consumers that comprise associations about a high level of price, quality, aesthetics, rarity, extraordinariness and a high degree of non-functional associations. ” (Heine, K. , 2012) Lauder Business School Marketing II / Session 2 15

Store Brands or Generic Brands Less expensive “me-too” product offering under a retailer’s own store or generic brand. Advantages for the customer: v. Brands convey information v Lower prices compared to branded products v Brands signal consistent quality v Brands reduce customer risk v Brands make purchasing decisions easier Advantages for the company: v Less entities in the value chain v Reduced expenses in R&D, package design, promotion v Ability to compete with discounter chains v… 16 Lauder Business School Marketing II / Session 2