Brand Management_2

New Perspective of Marketing:

• Digitalization and connectivity
• Disintermediation and re-intermediation
• Customization and Customerization
• Industry Convergence

How Business practices are changing:

Old Economy New Economy
Organize by product Units Organize customer segment
Look at Financial scorecard Look also at Marketing scorecard
Focus on Profitable transaction Focus on CLTV
Focus on Shareholder Focus on Stakeholder
Brand Building thro’ advertising Brand Building thro’ Marketing
Focus on Customer acquisition Focus on Customer retention
No CSM Measure CS and retention rate
Over promise, under deliver Under promise, over deliver



New Perspective of Marketing

A) Personalizing Marketing
(i) Experiential Marketing
(ii) Premise - Sense, feel, think, act and relate – Bernd Schmitt

B) Radical Marketing
Premise -
(i) CEO is marketing head
(ii) Marketing Dept is flat and small
(iii) Get out of Head Office
(iv) Hire passionate missionaries
(v) Be true to brand
(vi) Love and respect your Customer – Sam Hill

C) One to One Marketing
From Transaction based Marketing to Relationship based Marketing
(i) Focus on Individual consumers through consumer databases
“We single out consumers”
(ii) Respond to consumer dialogue via interactivity
“The consumer talks to us”
(iii) Customize products and services
“ We make something unique for him”

D) Permission Marketing
The practice of Marketing to the consumers only after gaining their express permission


Steps to effective permission marketing:
(i) Offer the prospect an incentive to volunteer
(ii)Teach the consumer about the product or service
(iii) Offer additional incentive to guarantee that the volunteer maintains the permission

E) 3D Marketing – McKinsey Consulting


It communicates 3 types of benefits:
1. Functional Benefits – Product, performance attributes, Value; quality etc.
2. Process Benefits – Ease of information, broad product selection,
automated product replenishment, convenient transactions
3. Relationship benefits – Value based on personalized service;
information sharing; value exchange


F) Relationship Marketing

FEW FACTS
• Acquiring new customer can cost 5 times more than retaining it
• On an average company losses 10 % of its customer every year (exception is Retail)
• 5% reduction in the customer defection rate can increase profits to 25 to 85 %

Mass Customization
• The premise is to make products to fit the customer’s exact specification
• It requires digital age technology
• Customer can communicate their preferences directly to the company
• Has sophisticated production line
• Dell Computer, Levi’s jeans, My Design - Barbie

After Marketing
• The activity occurs after the purchase is completed
• Creates better brand equity
• This technique can be used were the Company is very confident about the performance
• The product has long lasting Customer resonance

The Activities involve
1. Create information file
2. Analyze customer feedback
3. Conduct CS survey
4. Formulate & mange communication program
5. Host special customer events or program
6. Identify and reclaim lost customers.

Loyalty Program
• Can create strong ties with customer
• It is frequency marketing
• It is defined as identifying, maintaining and increasing the yield from a firm’s best customers through long-term, interactive, value-added relationships
• Most effective in Retail & Aviation

Effectiveness tips
1. Know your customer
2. Change in goods / merchandise
3. Listen to your best customer
4. Engage and respect them
5. Enhance their purchase by rewards or loyalty points



Brand Extensions

Advantages of Brand Extension
• Facilitate new Product acceptance
• Improve brand image
• Reduce risk received by customers
• Increase the probability of gaining distribution and trail
• Increase efficiency of promotional expenditures
• Reduce costs of introductory and follow-up marketing program
• Avoid cost of development a new brand
• Allow for packaging and labeling efficiencies
• Permit consumer variety seeking
• Provide feedback benefits to the Parent Brand and Company
• Clarify brand meaning
• Enhance the parent brand image
• Bring new customers into brand franchise and increase market coverage
• Revitalize the brand
• Permit subsequent extensions

Disadvantages of Brand Extension
• Can confuse or frustrate consumers
• Can encounter retailer resistance
• Can fail and hurt parent brand image
• Can succeed but cannibalize sales of parent brand
• Can succeed but diminish identification with any one category
• Can succeed but hurt the image of parent brand
• Can dilute brand meaning.