Brand Management (topic 1)
Learning objectives
- Why Brand management is core course in MSc Marketing Management (understand)
- How Brand management has evolved over time: the past, the present and the future (illustrate)
- What the essential learning will be in Brand management… and where to find them in the course
(convince).
Brand management: the past
In the past, products were commodities. This is a product where it doesn’t matter who sells it. It is all the
same to the consumer. So they were:
- Undifferentiable by seller/manufacturer
- Often sold loose (no packaging)
- The quality was highly variable (you could not tell up front; only if you knew the manufacturer)
- In competitive markets there were many manufacturers/sellers for the same commodity
Question: how do I get a buyer to prefer and buy my ‘commodity’?
Answer: differentiate your commodity from the competition and make it more attractive.
How: by branding your commodity
Branding started to show ownership. The word ‘brand’ comes from the Old Norse word ‘Brandr’,
meaning ‘to burn’. First there were marks on Chinese porcelain and pottery in Greece, Rome, and
India to show who made the goods (1300 BC). Second, cattle ranchers (veeboeren) burned symbols
onto their cows to prove ownership. Third, bakers were legally required to mark their bread to
ensure quality and accountability (1266- English bakers). Fourth, ‘the moon & the stars’ logo was
one of the first modern product brand, helping consumers recognize and trust the product (1851-
Procter & Gamble). And lastly, the first nationally branded packaged food in the U.S. sold in sealed
boxes with a name and advertising campaign, guaranteeing hygiene and consistent quality (1898-
Uneeda biscuits). Logos were used because people could not read. It was for recognition.
Brand= ‘A name, term, sign, symbol, or design, or a combination of them, intended to identify the goods
and services of one seller or a group of sellers and to differentiate them form those of competition.
➔ Why would you spend more money on a brand like Louis Vuitton? Because people use brands to
identify themselves. People want to pay for the brand. A brand is much more than just a product. A
brand creates a certain amount of meaning, reputation, preference, and so on… in the eyes of the
customer.
Brand management: the present
Changing perspectives
Historically, a brand was defined by the organization as a physical product (inside out) with tangible
attributes. The focus was on the products features. The company produced the product, and the
consumers bought it. So, if you look at the 4 levels of Levitt, the focus was more on the core product and
the tangible product.
Today, this perspective has shifted dramatically. Brands are now viewed from the customer’s point of
view and are considered a psychological product (outside in). They are the sum of what other say they
are, build on the worth of mouth, ratings and reviews. If we look at the four levels of Levitt, here it is also
about the augmented product and the total product.
,➔ Think about the Diet Coke vs. the Diet Pepsi example. One test was blind and the other identified. It
showed that brand perception and loyalty override the physical experience of the product itself.
Brand= a product, but one that adds other dimensions that differentiate it in some way from other
products designed to satisfy (the same) needs. These valued differences can be:
- Rational and tangible (such as perfect cut or the finest cotton), but are often
- Intangible, emotional and symbolic (like feelings of belonging or luxury).
➔ Cracker and Barrel updated its logo from an old, country-style design to a more modern one. This
change was not well received by customers who felt a strong connection to the original brand, which
was considered as part of the American culture.
Consumers value brands not just for their functional attributes, but also for the sensory pleasure and
potentional self-expression they may experience when buying and using the brand (psychological
benefits). They are called brand values (foundational beliefs a brand stands for and is the connection):
- Brand quality (the product is reliable and well-made)
- Brand credibility (how reliable and honest is the brand?)
- Brand likeability (how sympathetic a brand is)
- Brand authenticity (the brand feels genuine and honest)
- Brand transparency (how open the brand is about their way of working)
- Brand status (the social prestige that the brand has)
- Brand sustainability (the brand is environmentally and socially responsible)
These brand values lead to functional and psychological benefits the consumer is looking for in a brand. If
the inside out and the outside in match, you do well as a company. So, managers need more research on
those brand values that are relevant to and align with the personal values of the target audience.
The Means-End chain model is the key to understanding this. It explains how a consumers mind links a
products concrete attribute (the means) to their own personal values (ends).
1. Attributes (concrete: tangibles and abstract: intangible like fast).
2. Consequences are the benefits derived from those attributes (functional: direct/tangible benefits
and psychosocial: how the product makes you feel).
3. Values are the personal goals or beliefs achieved (instrumental: how to achieve terminal and
terminal: what you want to achieve).
➔ Saddlemyer and Bruyneel is a fashion company that needed a new logo. The example shows that the
logo must match its desired brand values. A logo isn’t just a symbol it is a tool for communicating
specific values. Subtle logo fits brands that want to convey credibility and status. A salient
(prominent) logo fits brands that want to be conspicuous and likeable.
Product vs brand
Product= Anything that can be offered to a market for attention, acquisition, use or consumption.
Branded product= a product that has been given a name for identification purposes. It is a product with a
name but has no meaning for the customer.
Brand= a product, but one that adds other dimensions that differentiate it in some way from other
products designed to satisfy (the same) needs. Products that resonate with a person.
, Product -> branded product (physical product Branded product -> brand (psychological product
perspective) has a product give it a name. perspective) sees the brand that has a product.
▪ Tangible: can be touched ▪ Intangible: lives in the mind
▪ Can be copied ▪ Unique
▪ Can be outdated ▪ Potentially timeless
▪ Involves transactions ▪ Forms basis of connections (Cracker Barrel)
▪ Differentiation ▪ Relevance
▪ Attributes ▪ Personality
▪ Promise ▪ Relationship
▪ Static ▪ Dynamic
▪ Mass ▪ Individual
▪ Awareness ▪ Meaningfulness (meaning of the brand)
➔ Liga was founded 100 years ago. they were relevant for 60 years. The current people do not grow up
with Liga. How can Liga be made relevant again for the younger ones?
➔ We are moving to engagement.
It shows the shift from a physical object (identification) to a meaningful, psychological concept (brand
identity).
Importance
Why are brands important for consumers?
- Identification of product and source (recognize the product and who made it)
- Assignment of responsibility to product maker (by putting the brand name on the product, the
brand takes responsibility for its performance and quality)
- Risk reducer (guarantee of quality)
- Search cost reducer (saves time and effort because of the positive experiences)
- Bond/pact with maker of product (personal relationship or loyalty)
- Symbolic device (a brand can represent a certain lifestyle, status, etc.)
- Signal of quality
Why are brand important for producers?
- Means of legally protecting unique features (preventing competitors copying)
- Signal of quality level (justifies a higher price)
- Means of endowing products with unique associations (gives it a special unique meaning)
- Source of competitive advantages (barrier to entry, difficult new competitors)
- Source of financial returns (higher prices than an unbranded product)
➔ Water is just water. It’s about the brand equity (extra value a product gains simply because of its
brand name). Certain brands can generate higher prices because of the brand).
Customer based brand equity (CBBE)= (1) Differential effect that (2) brand knowledge has on (3)
consumer response to the marketing of the brand.
1. Differential effect: this means the difference in the way people react.
2. Brand knowledge: this is everything a customer has learned, felt, seen, and heard about the
brand over time. All the thoughts, feelings, images, and beliefs stored in their mind.
3. Consumer response: this is how the consumers behave when exposed to the brands marketing
e.g. buy, willing to pay more, loyalty and recommended).
Thus, CBBE is the degree to which a customer’s positive or negative thoughts about your brand cause
them to react differently to your product or marketing than they would to an unbranded or unknown
version.
➔ Learn the CBBE by heart. A brand has positive consumer-based brand equity (more value) when
consumers react more favourably to a product and the way it is marketed when the brand is identified
than when it is not (e.g. when it is attributed to a fictitiously named or unnamed version of the
product).
, While brand equity is the overall financial and market value of the brand, CBBE is the driver of that value.
CBBE focuses specifically on the consumers mind, following that the power of a brand resides in the
minds of consumers.
Brand equity= a brand is much more than a logo or a name. It is a powerful asset that Is crucial to every
marketing strategy. It stresses the importance of the role of the brand in marketing strategies. This means
that a company’s success with any marketing action (like advertising, pricing or product development) is
directly tied to the underlying strength of its brand.
- Differences in outcomes arise from “added value” because of past marketing activities for the
brand. This indicates that the differences in how consumers respond, or the financial results, are
due to the extra value that has been built up over time through the brands history,
advertisements, and overall consumer experience.
- Brand equity provides a common denominator for interpreting marketing strategies and
assessing the value of a brand. Brand equity acts as a single framework that helps managers
evaluate different marketing plans and determines the total financial worth of the brand.
- Value can be manifested in different ways (e.g. greater proceeds, gains, a/0 lower costs, gains.
- This value can be created in many different ways. Brand equity is complex and involves multiple
strategies and actions.
Brand management goals:
Consumer-based brand equity (CBBE)= build, sustain and leverage positive, strong, active, unique
meanings of the brand. The reasons for customers to buy my brand instead of the competitors.
Financial-based brand equity (FBBE)= to enable the brand to earn more in the short and long run. How
much is the brand worth in dollars/euros or other financial terms?
➔ In the long run the CBBC can influence the FBBE.
The key to branding is that consumers perceive relevant differences among brands in a product category/
the brand resides in the minds of consumers, so
- Give it a label (how to identify) and
- Provide meaning (what it does for you)
➔ Everything can be branded even commodities (e.g. milk or cheese).
This can be branded:
1) Physical goods
• Fast moving packaged consumers goods: almost 100% is branded (e.g. drinks/snacks)
• Business-to-business products: creating a positive image and reputation for a company
(e.g. Boeing is not branding the product features but about marketing the company’s
reliability).
• High-tech products: financial success is no longer driven by product innovation or latest
product specifications and features alone (e.g. Intel turned an unseen component, the
microchip, into a trusted brand, assuring consumers of quality and performance even it
she didn’t understand the technical specs).
2) Services
• Address potentional intangibility and variability problems
• Brand symbols to make abstract nature more concrete
3) Retailers and distributors
• Generate consumers interest, patronage and loyalty in a store and
• Learn consumers to expect certain brand and products form a store
• Like PL brands (AH and Tesco)
4) Online products and services
• Improving customer associations because unique product attributes of the brand
(convenience, price, etc.) are not enough (Google vs Googol).
5) People and organizations (e.g. Trump)
6) Sports, arts and entertainment: experience goods (Walt Disney and Pixar)
7) Geographic locations (e.g. Paris)
8) Ideas and causes (e.g. Pink Ribbon)
Learning objectives
- Why Brand management is core course in MSc Marketing Management (understand)
- How Brand management has evolved over time: the past, the present and the future (illustrate)
- What the essential learning will be in Brand management… and where to find them in the course
(convince).
Brand management: the past
In the past, products were commodities. This is a product where it doesn’t matter who sells it. It is all the
same to the consumer. So they were:
- Undifferentiable by seller/manufacturer
- Often sold loose (no packaging)
- The quality was highly variable (you could not tell up front; only if you knew the manufacturer)
- In competitive markets there were many manufacturers/sellers for the same commodity
Question: how do I get a buyer to prefer and buy my ‘commodity’?
Answer: differentiate your commodity from the competition and make it more attractive.
How: by branding your commodity
Branding started to show ownership. The word ‘brand’ comes from the Old Norse word ‘Brandr’,
meaning ‘to burn’. First there were marks on Chinese porcelain and pottery in Greece, Rome, and
India to show who made the goods (1300 BC). Second, cattle ranchers (veeboeren) burned symbols
onto their cows to prove ownership. Third, bakers were legally required to mark their bread to
ensure quality and accountability (1266- English bakers). Fourth, ‘the moon & the stars’ logo was
one of the first modern product brand, helping consumers recognize and trust the product (1851-
Procter & Gamble). And lastly, the first nationally branded packaged food in the U.S. sold in sealed
boxes with a name and advertising campaign, guaranteeing hygiene and consistent quality (1898-
Uneeda biscuits). Logos were used because people could not read. It was for recognition.
Brand= ‘A name, term, sign, symbol, or design, or a combination of them, intended to identify the goods
and services of one seller or a group of sellers and to differentiate them form those of competition.
➔ Why would you spend more money on a brand like Louis Vuitton? Because people use brands to
identify themselves. People want to pay for the brand. A brand is much more than just a product. A
brand creates a certain amount of meaning, reputation, preference, and so on… in the eyes of the
customer.
Brand management: the present
Changing perspectives
Historically, a brand was defined by the organization as a physical product (inside out) with tangible
attributes. The focus was on the products features. The company produced the product, and the
consumers bought it. So, if you look at the 4 levels of Levitt, the focus was more on the core product and
the tangible product.
Today, this perspective has shifted dramatically. Brands are now viewed from the customer’s point of
view and are considered a psychological product (outside in). They are the sum of what other say they
are, build on the worth of mouth, ratings and reviews. If we look at the four levels of Levitt, here it is also
about the augmented product and the total product.
,➔ Think about the Diet Coke vs. the Diet Pepsi example. One test was blind and the other identified. It
showed that brand perception and loyalty override the physical experience of the product itself.
Brand= a product, but one that adds other dimensions that differentiate it in some way from other
products designed to satisfy (the same) needs. These valued differences can be:
- Rational and tangible (such as perfect cut or the finest cotton), but are often
- Intangible, emotional and symbolic (like feelings of belonging or luxury).
➔ Cracker and Barrel updated its logo from an old, country-style design to a more modern one. This
change was not well received by customers who felt a strong connection to the original brand, which
was considered as part of the American culture.
Consumers value brands not just for their functional attributes, but also for the sensory pleasure and
potentional self-expression they may experience when buying and using the brand (psychological
benefits). They are called brand values (foundational beliefs a brand stands for and is the connection):
- Brand quality (the product is reliable and well-made)
- Brand credibility (how reliable and honest is the brand?)
- Brand likeability (how sympathetic a brand is)
- Brand authenticity (the brand feels genuine and honest)
- Brand transparency (how open the brand is about their way of working)
- Brand status (the social prestige that the brand has)
- Brand sustainability (the brand is environmentally and socially responsible)
These brand values lead to functional and psychological benefits the consumer is looking for in a brand. If
the inside out and the outside in match, you do well as a company. So, managers need more research on
those brand values that are relevant to and align with the personal values of the target audience.
The Means-End chain model is the key to understanding this. It explains how a consumers mind links a
products concrete attribute (the means) to their own personal values (ends).
1. Attributes (concrete: tangibles and abstract: intangible like fast).
2. Consequences are the benefits derived from those attributes (functional: direct/tangible benefits
and psychosocial: how the product makes you feel).
3. Values are the personal goals or beliefs achieved (instrumental: how to achieve terminal and
terminal: what you want to achieve).
➔ Saddlemyer and Bruyneel is a fashion company that needed a new logo. The example shows that the
logo must match its desired brand values. A logo isn’t just a symbol it is a tool for communicating
specific values. Subtle logo fits brands that want to convey credibility and status. A salient
(prominent) logo fits brands that want to be conspicuous and likeable.
Product vs brand
Product= Anything that can be offered to a market for attention, acquisition, use or consumption.
Branded product= a product that has been given a name for identification purposes. It is a product with a
name but has no meaning for the customer.
Brand= a product, but one that adds other dimensions that differentiate it in some way from other
products designed to satisfy (the same) needs. Products that resonate with a person.
, Product -> branded product (physical product Branded product -> brand (psychological product
perspective) has a product give it a name. perspective) sees the brand that has a product.
▪ Tangible: can be touched ▪ Intangible: lives in the mind
▪ Can be copied ▪ Unique
▪ Can be outdated ▪ Potentially timeless
▪ Involves transactions ▪ Forms basis of connections (Cracker Barrel)
▪ Differentiation ▪ Relevance
▪ Attributes ▪ Personality
▪ Promise ▪ Relationship
▪ Static ▪ Dynamic
▪ Mass ▪ Individual
▪ Awareness ▪ Meaningfulness (meaning of the brand)
➔ Liga was founded 100 years ago. they were relevant for 60 years. The current people do not grow up
with Liga. How can Liga be made relevant again for the younger ones?
➔ We are moving to engagement.
It shows the shift from a physical object (identification) to a meaningful, psychological concept (brand
identity).
Importance
Why are brands important for consumers?
- Identification of product and source (recognize the product and who made it)
- Assignment of responsibility to product maker (by putting the brand name on the product, the
brand takes responsibility for its performance and quality)
- Risk reducer (guarantee of quality)
- Search cost reducer (saves time and effort because of the positive experiences)
- Bond/pact with maker of product (personal relationship or loyalty)
- Symbolic device (a brand can represent a certain lifestyle, status, etc.)
- Signal of quality
Why are brand important for producers?
- Means of legally protecting unique features (preventing competitors copying)
- Signal of quality level (justifies a higher price)
- Means of endowing products with unique associations (gives it a special unique meaning)
- Source of competitive advantages (barrier to entry, difficult new competitors)
- Source of financial returns (higher prices than an unbranded product)
➔ Water is just water. It’s about the brand equity (extra value a product gains simply because of its
brand name). Certain brands can generate higher prices because of the brand).
Customer based brand equity (CBBE)= (1) Differential effect that (2) brand knowledge has on (3)
consumer response to the marketing of the brand.
1. Differential effect: this means the difference in the way people react.
2. Brand knowledge: this is everything a customer has learned, felt, seen, and heard about the
brand over time. All the thoughts, feelings, images, and beliefs stored in their mind.
3. Consumer response: this is how the consumers behave when exposed to the brands marketing
e.g. buy, willing to pay more, loyalty and recommended).
Thus, CBBE is the degree to which a customer’s positive or negative thoughts about your brand cause
them to react differently to your product or marketing than they would to an unbranded or unknown
version.
➔ Learn the CBBE by heart. A brand has positive consumer-based brand equity (more value) when
consumers react more favourably to a product and the way it is marketed when the brand is identified
than when it is not (e.g. when it is attributed to a fictitiously named or unnamed version of the
product).
, While brand equity is the overall financial and market value of the brand, CBBE is the driver of that value.
CBBE focuses specifically on the consumers mind, following that the power of a brand resides in the
minds of consumers.
Brand equity= a brand is much more than a logo or a name. It is a powerful asset that Is crucial to every
marketing strategy. It stresses the importance of the role of the brand in marketing strategies. This means
that a company’s success with any marketing action (like advertising, pricing or product development) is
directly tied to the underlying strength of its brand.
- Differences in outcomes arise from “added value” because of past marketing activities for the
brand. This indicates that the differences in how consumers respond, or the financial results, are
due to the extra value that has been built up over time through the brands history,
advertisements, and overall consumer experience.
- Brand equity provides a common denominator for interpreting marketing strategies and
assessing the value of a brand. Brand equity acts as a single framework that helps managers
evaluate different marketing plans and determines the total financial worth of the brand.
- Value can be manifested in different ways (e.g. greater proceeds, gains, a/0 lower costs, gains.
- This value can be created in many different ways. Brand equity is complex and involves multiple
strategies and actions.
Brand management goals:
Consumer-based brand equity (CBBE)= build, sustain and leverage positive, strong, active, unique
meanings of the brand. The reasons for customers to buy my brand instead of the competitors.
Financial-based brand equity (FBBE)= to enable the brand to earn more in the short and long run. How
much is the brand worth in dollars/euros or other financial terms?
➔ In the long run the CBBC can influence the FBBE.
The key to branding is that consumers perceive relevant differences among brands in a product category/
the brand resides in the minds of consumers, so
- Give it a label (how to identify) and
- Provide meaning (what it does for you)
➔ Everything can be branded even commodities (e.g. milk or cheese).
This can be branded:
1) Physical goods
• Fast moving packaged consumers goods: almost 100% is branded (e.g. drinks/snacks)
• Business-to-business products: creating a positive image and reputation for a company
(e.g. Boeing is not branding the product features but about marketing the company’s
reliability).
• High-tech products: financial success is no longer driven by product innovation or latest
product specifications and features alone (e.g. Intel turned an unseen component, the
microchip, into a trusted brand, assuring consumers of quality and performance even it
she didn’t understand the technical specs).
2) Services
• Address potentional intangibility and variability problems
• Brand symbols to make abstract nature more concrete
3) Retailers and distributors
• Generate consumers interest, patronage and loyalty in a store and
• Learn consumers to expect certain brand and products form a store
• Like PL brands (AH and Tesco)
4) Online products and services
• Improving customer associations because unique product attributes of the brand
(convenience, price, etc.) are not enough (Google vs Googol).
5) People and organizations (e.g. Trump)
6) Sports, arts and entertainment: experience goods (Walt Disney and Pixar)
7) Geographic locations (e.g. Paris)
8) Ideas and causes (e.g. Pink Ribbon)
