3.

Growing and Sustaining Brand Equity

A. Designing & Implementing Branding Strategies:
• Brand Architecture
• Brand Hierarchy: Meaning of Brand Hierarchy, Building Equity at Different
Hierarchy Levels
• Cause Marketing to Build Brand Equity: Meaning of Cause Marketing,
Advantages, Green Marketing
B. Brand Extensions: Meaning, Advantages, Disadvantages, Brand Extension and Brand
Equity
C. Managing Brands over Time: Reinforcing Brands, Revatilising Brands

A. Designing & Implementing Branding Strategies

Brand Architecture

Meaning

Brand architecture is a system that organizes brands, products and services to help your
services to help your audience access and relate to the brand

Brand architecture is the structure of brands within an organization entity. It is the way in
which the brands within a company’s portfolio are related to, and differentiated from, one
another. The architecture should define the different leagues of branding within the
organization; how the corporate brand and sub-brands relate to and support each other; and
how the sub-brands reflect and reinforce the core purpose of the corporate brand to which
they belong.

Types of brand architecture

1. Monolithic/Master brand - In this approach, customers make choices based on brand
loyalty. Features and benefits matter less to the consumer than the brand promise and
persona

Example- FedEx.

2- Endorsed brand Architecture -It is characterized by marketing synergy between the

product or division, and the parent company.

Example- Nestle- Nesperesso , Nescafe , Nestea and Toyota.

3- Pluralistic brand architecture / Individual - It is characterised by a series of well known

consumer brands. It does not depend on master brand but instead on each sub-brand has
its own image.

Example- Procter&Gamble- Gillette, Tide , Oral-B.

Strategic considerations while designing the brand architecture

• Structuring a company brand portfolio can involve choosing a strategy based upon a
number of variables, including
- Business strategy
- Market trends Competitive tactics
- Sources of growth and profit.
• Often marketing mix modeling is used to help understand the role of brands in a
portfolio, and how they support or cannibalize one another.
• A strong parent brand can be leveraged across multiple sub-brands to help maximize
Return on Marketing Investment.
• Managing brand architecture to maximize shareholder value can often include using
brand valuation model techniques.

Benefits

• Allows to target the needs of specific customers.

• Ensures clarity and synergy between brands, products, and services.
• Balance between main brands and its sub brands.
• Maximize visibility in competitive marketplace.

Brand Hierarchy

Meaning

A brand hierarchy is a useful means of graphically portraying a firm’s branding strategy by

displaying the number and nature of common and distinctive brand elements across the
firm’s products, revealing their explicit ordering. It’s based on the realization that we can
brand a product in different ways depending on how many new and existing brand elements
we use and how we combine them for any one product.
For example, a Dell Inspiron 17R notebook computer consists of three different brand name
elements, “Dell,” “Inspiron,” and “17R.” Some of these may be shared by many different
products; others are limited. Dell uses its corporate name to brand many of its products, but
Inspiron designates a certain type of computer (portable), and 17R identifies a particular
model of Inspiron (designed to maximize gaming performance and entertainment and
including a 17inch screen).

There are different ways to define brand elements and levels of the hierarchy. Perhaps the
simplest representation from top to bottom might be:

1. Corporate or company brand (General Motors)

2. Family brand (Buick)

3. Individual brand (Regal)

4. Modifier (designating item or model) (GS)

5. Product description (midsize luxury sport sedan automobile)

Important Types/Levels

1. Corporate brand, umbrella brand, and family brand – Examples include Virgin Group and
Heinz. These are consumer-facing brands used across all the firm's activities, and this name is
how they are known to all their stakeholders – consumers, employees, shareholders,
partners, suppliers and other parties. These brands may also be used in conjunction with
product descriptions or sub-brands: for example Heinz Cream of Tomato Soup, or Virgin
Trains.

2. Endorsed brands, and sub-brands – For example, Nestle KitKat, Cadbury Dairy Milk, Sony
PlayStation or Polo by Ralph Lauren. These brands include a parent brand – which may be a
corporate brand, an umbrella brand, or a family brand – as an endorsement to a sub-brand
or an individual, product brand. The endorsement should add credibility to the endorsed sub-
brand in the eyes of consumers.

3. Individual product brand – For example, Procter & Gamble’s Pampers or Unilever's Dove.
The individual brands are presented to consumers, and the parent company name is given
little or no prominence. Other stakeholders, like shareholders or partners, will know the
producer by its company name.

Example of using and changing brand architecture strategy - A recent example of brand
architecture in action is the reorganization of the General Motors brand portfolio to reflect
its new strategy. Prior to bankruptcy, the company pursued a corporate-endorsed hybrid
brand architecture structure, where GM underpinned every brand. The practice of putting
the "GM Mark of Excellence" on every car, no matter what the brand, was discontinued in
August, 2009. In the run-up to the IPO, the company adopted a multiple brand corporate
invisible brand architecture structure with brands like Chevrolet, Cadillac, Buick etc without
the GM prefix.

Benefits of brand hierarchy

• Helps the company to decide on which products are to be introduced.

• Each brand attracts attention appropriately at the same time new products get
support of established brands.
• Cross-sells and Up-sells are easier.
• Customers are not confused about the offering.

Cause Marketing

Meaning

Cause marketing is defined as “A type of corporate social responsibility, in which a company’s

promotional campaign has the dual purpose of increasing profitability while bettering
society.”

In cause marketing, many a times, a for-profit organisation collaborates with a non-profit

organisation for advancing the efforts of the non-profit organisation towards a cause and the
marketing objectives of the for-profit organisation. Cause marketing leads to several benefits
including revenue generation, creating awareness and gaining support- both financial as well
as logistic from the people the communication is targeted at.

Advantages of Cause Marketing

The purpose of cause marketing is to increase exposure and awareness for both the for-profit
business and the non-profit organization. When cause marketing is effective, some of the
benefits you can expect include:

1. An increase in customer loyalty - Making a positive impact in the world can, in turn,
have a positive impact on how your brand is perceived by customers. Customers
prefer a brand which is socially responsible.
2. A boost in employee morale - For many, a company’s social and environmental
responsibility plays a factor when deciding whether to accept a job offer. Most
employees who work for a company that supports a cause express a strong sense of
loyalty and say they’re proud of their company’s values.
3. An increase in sales - Your “cause” becomes another selling point for your products
or services. An increase in sales will lead to an increase in revenue which will in turn
lead to an increased profitability of the firm.
4. Improved PR - To put it bluntly, cause marketing is good for companies because it
helps their image. Consumers want to feel good about their spending, and in the
digital age, they’re more knowledgeable about their options and the impacts of their
purchases than ever before.
 5. Trust among Stakeholders - Associating one’s organisation with a cause builds trust
and respect among the various stakeholders like suppliers, customers, shareholders
and financial institutions. This would lead to a smooth functioning of business.
6. Targets Specific Audience - Depending on the cause you partner with, different people
will be interested. For example, if you were to partner with a charity working with old
age homes, then would bring in individuals interested by that topic.
7. Competitive Advantage - We live in a very competitive marketplace. It has become
increasingly harder to stand out among the noise and cause-related marketing may be
just the edge you need.
8. Satisfies growing expectations of Customers - People care. It is important to increase
your appeal to the wide landscape of individuals and their ideals- this now includes
supporting a cause.

Examples

Tata Tea's Jaago Re - Jaago Re has been the clarion call of a lot of Tata Tea advertising
initiatives since 2009, although the object of Jaago Re, which translates from Hindi as Wake
up, has changed through the years. The very first Jaago Re campaign was a reminder to the
country’s citizenry to assert their political franchise, vote, and elect their leaders who would
be accountable to them in the process of governance. Later campaigns have spread messages
about anti-bribery, dissemination of knowledge in simplified form, and Chhoti Shuruaat (New
Beginning), for the empowerment of women.

Lifebuoy’s Help a child reach 5 - Preventable infections, usually diarrhoea and pneumonia,
kill over 1.3 million children in India every year before they reach the age of five. Many of
these infants and children are from rural and semi-rural regions and low income families,
which almost necessarily means that their mothers, who are also often their primary
caregivers, have little awareness about how the simplest little acts can prevent the infections
in the first place.

One of these things is washing hands with soap after eating, using the lavatory, caring for sick
people, and touching animals.

Lifebuoy promoted the benefits of hand-washing and widely publicized hand hygiene
information in rural areas. For a time, Hindustan Unilever, which is the corporate that owns
the Lifebuoy brand, worked in tandem with the Swachh Bharat (or Clean India) program
spearheaded by the Modi government to broadcast a simple, compelling message - Wash
hands, save lives.

130 million people have been trained to have better hand hygiene already via the Help a child
reach 5 program, and many of these are parents of children who were at risk, but are now
protected. One in three mothers wash their hands at the right times. Diarrhoea incidence has
fallen across India from 47% to 11%.
Conclusion

In the end, cause marketing is something consumers expect now and if you are not doing it,
then your competitor probably is. SO, it is really important not to get left behind in the
moment. Cause marketing gives an opportunity to do something good for the society as well
as for the organisation at the same time.

Green Marketing

Meaning

Green Marketing means undertaking all marketing activities with the least negative and
maximum positive impact on both the physical and social environment.

The term ‘green’ is indicative of purity. Green means pure in quality and fair or just in dealing.
For example, green advertising means advertising without adverse impact on society. Green
message means matured and neutral facts, free from exaggeration or ambiguity.

Basically, green marketing concerns with three aspects:

1. Promotion of production and consummation of pure/quality products,

2. Fair and just dealing with customers and society
3. Protection of ecological environment.

Impact of Green Marketing

1. Now, people are insisting pure products – edible items, fruits, and vegetables based
on organic farming. The number of people seeking vegetarian food is on rise.
2. Reducing use of plastics and plastic-based products.
3. Increased consumption of herbal products instead of processed products.
4. Recommending use of leaves instead of plastic pieces; jute and cloth bags instead of
plastic carrying bags.
5. Increasing use of bio-fertilizers (made of agro-wastes and wormy-composed) instead
of chemical fertilizers (i.e. organic farming), and minimum use of pesticides.
6. Worldwide efforts to recycle wastes of consumer and industrial products.
7. Increased use of herbal medicines, natural therapy, and Yoga.
8. Strict provisions to protect forests, flora and fauna, protection of the rivers, lakes and
seas from pollutions.
9. Global restrictions on production and use of harmful weapons, atomic tests, etc.
Various organisations of several countries have formulated provisions for protecting
ecological balance.
10. More emphasis on social and environmental accountability of producers.

Effective Strategies of Green Marketing

1. Green Design - Oftentimes, companies resort to greenwashing because their products and
services are not green to begin with. A take-out bag with a big recycle symbol on the front
may actually be made from virgin, and not recycled, paper. A fuel-efficient car that experts
are raving about on social media may contain conflict materials. The most important green
marketing strategy is to design products and services that are green to begin with. If a product
or service is environmentally-friendly from the ground up, there is no need for greenwashing.
Fuji Xerox’s Green Wrap is an example of a product with a green design.

2. Green Positioning - A company should explicitly promote its sustainability performance—

and those of its products and services—as a key component of its business activities.
Everything a company does should reflect its sustainability values. They cannot claim to be
sustainable while engaging in unsustainable business practices such as making employees
work under sweatshop conditions. Doing so will ruin the company’s credibility with
consumers.

The Body Shop exemplifies effective green positioning. On its official website the company
identifies its values. They are against animal testing; support community fair trade; activate
self-esteem; defend human rights; and protect the planet; and The Body Shop lives up to
these values.

3. Green Pricing - A company should highlight how a green product or service can help
consumers save key resources. A car company, for instance, can promote its latest vehicle by
emphasizing how it is more fuel-efficient compared with other leading car brands. This allows
consumers to actively participate in sustainability. They become aware that their choice is
about investing in something that will allow them to save money and resources in the future,
rather than making a short-term purchase.

Example:

Johnsons& Johnsons: The brand behind Band-Aid and a line of well-known baby products,
Johnson & Johnson has created its own Environment, Health, Safety, and Sustainability
Department to fine-tune internal practices. They’ve implemented an on-the-job training
program to make sure everyone at their company is on the same page with core values and
key issues. Johnson & Johnson has set sustainability goals that include increasing product
recycling to reduce carbon emissions by 20 percent by 2020.

B. Brand Extensions
Meaning

A brand extension occurs when a firm uses an established brand name to introduce a new
product. This new product to which the brand is extended can be related or unrelated to the
existing product. For example, in India, the brand name of Maggi was extended from just
noodles to ketchup and soups as well.
Advantages of Brand Extension

Advantages of brand extension can be categorized as those that facilitate new-product

acceptance and those that provide feedback benefits to the parent brand or company as
whole.

1. Improve Brand Image: One of the advantages of a well-known and well-liked brand is
that consumers form expectations of its performance over time. They can form similar
inferences and expectations about the likely composition and performance of a brand
extension, based on what they already know about the brand itself and the extent to
which they feel this information is relevant to the new product.
2. Reduce Risk Perceived by Customers: Known brands like Johnson and Johnson, Tata
and OnePlus in India command a certain degree of reliability and security among
customers. Perceptions of corporate credibility in terms of the firm’s expertise and
trust worthiness can be valuable associations in introducing brand extensions.
3. Increase the Probability of Gaining Distribution and Trial: The potential for increased
consumer demand for a new product introduced as an extension may convince
retailers to stock and promote it.
4. Less promotional cost: From a marketing communications perspective, one obvious
advantage of introducing a new product as a brand extension is that the introductory
campaign does not have to create awareness of both the brand and the new product
but instead can concentrate on only the new product itself.
5. Avoid Cost of Developing a New Brand: Developing new brand elements is an art and
a science. To conduct the necessary consumer research and employ skilled personnel
to design high-quality brand names, logos, symbols, packages, characters, and slogans
can be quite expensive, and there is no assurance of success.
6. Allow for Packaging and Labeling Efficiencies: Similar or identical packages and labels
for extensions can result in lower production costs and, if coordinated properly, more
prominence in the retail store where they can create a “billboard” effect. For example,
Patanjali has a lot of product categories. Whenever customers move in a retail store,
they find Patanjali in most of the product categories.
7. Permit Consumer Variety-Seeking: If marketers offer a portfolio of brand variants
within a product category, consumers who need a change—because of boredom or
satiation— can switch without having to leave the brand family. A complement of line
extensions can also encourage customers to use the brand to a greater extent or in
different ways.
8. Clarify Brand Meaning: Extensions can help clarify the meaning of a brand to
consumers and define the kinds of markets in which it competes, an important first
step in the brand architecture process. Broader brand meaning often is necessary so
that firms avoid “marketing myopia” and do not mistakenly draw narrow boundaries
around their brand, either missing market opportunities or becoming vulnerable to
well-planned competitive strategies.
 9. Enhance the Parent Brand Image: One common way a brand extension affects the
parent brand image is by helping clarify its core brand values and associations. For
example, Nike has expanded from running shoes to other athletic shoes, athletic
clothing, and athletic equipment, strengthening its associations to “peak
performance” and “sports” in the process. Another type of association that successful
brand extensions may improve is consumer perceptions of the company’s credibility.
10. Bring New Customers into the Brand Franchise and Increase Market Coverage:
Extensions can benefit the parent brand by expanding market coverage, such as by
offering a product benefit whose absence may have prevented consumers from trying
the brand.
11. Permit Subsequent Extensions: One benefit of a successful extension—especially a
category extension—is that it may serve as the basis for subsequent extensions.
12. Revitalize the Brand: Sometimes brand extensions can be a means to renew interest
in and liking for the brand.

Disadvantages of Brand Extension

1. Loss of reliability: Brand extension in unrelated markets may lead to loss of reliability
if a brand name is extended too far. An organization must research the product
categories in which the established brand name will work.
2. Damage of core idea of the brand: is a risk that the new product may generate
implications that damage the image of the core/original brand.
3. Less awareness and less trials: There are chances of less awareness and trial because
the management may not provide enough investment for the introduction of new
product assuming that the spin-off effects from the original brand name will
compensate.
4. Superiority of the competitors: the brand extensions have no advantage over
competitive brands in the new category, then it will fail.

Instances of brand extension failures

1. New Coke - Coca Cola has forgotten what the core brand was meant to stand for. It thought
that taste was the only factor that consumer cared about. It was wrong. The time and money
spent on research on new Coca Cola could not evaluate the deep emotional attachment to
the original Coca- Cola.

2. Rasna Ltd. - Is among the famous soft drink companies in India. But when it tried to move
away from its niche, it hasn’t had much success. When it experimented with fizzy fruit drink
“Oranjolt”, the brand bombed even before it could take off. Oranjolt was a fruit drink in which
carbonates were used as preservative. It didn’t work out because it was out of
synchronization with retail practices. Oranjolt need to be refrigerated and it also faced quality
problems. It has a shelf life of three-four weeks, while other soft- drinks assured life of five
months.
Brand Extensions and Brand Equity

An extension’s ultimate success will depend on its ability to both achieve some of its own
brand equity in the new category and contribute to the equity of the parent brand.

The success of a brand extension activity needs to be assessed on two levels –

• Contribution of the parent brand to the new i.e. the extended brand and
• Contribution to the brand equity of the parent brand

Contribution of the parent brand

Initially, whether we can create a positive image for an extension will depend on three
consumer-related factors:

1. How salient parent brand associations are in the minds of consumers in the
extension context; that is, what information comes to mind about the parent
brand when consumers think of the proposed extension, and the strength of those
associations.
2. How favourable any inferred associations are in the extension context; that is,
whether this information suggests the type of product or service the brand
extension would be, and whether consumers view these associations as good or
bad in the extension context.
3. How unique any inferred associations are in the extension category; that is, how
these perceptions compare with those about competitors.

Contribution to Parent Brand Equity

To contribute to parent brand equity, an extension must strengthen or add favourable and
unique associations to the parent brand and not diminish the strength, favourability, or
uniqueness of any existing associations. The effects of an extension on consumer brand
knowledge will depend on four factors:

1. How compelling the evidence is about the corresponding attribute or benefit

association in the extension context—that is, how attention-getting and unambiguous
or easily interpretable the information is. Strong evidence is attention-getting and
unambiguous. Weak evidence may be ignored or discounted.
2. How relevant or diagnostic the extension evidence is for the attribute or benefit for
the parent brand, that is, how much consumers see evidence on product performance
or imagery in one category as predictive of product performance or imagery for the
brand in other categories. Evidence will affect parent brand evaluations only if
consumers feel extension performance is indicative of the parent brand in some way.
3. How consistent the extension evidence is with the corresponding parent brand
associations. Consistent extension evidence is less likely to change the evaluation of
 existing parent brand associations. Inconsistent extension evidence creates the
potential for change, with the direction and extent of change depending on the
relative strength and favourability of the evidence. Note, however, that consumers
may discount or ignore highly inconsistent extension evidence if they don’t view it as
relevant.
4. How strongly existing attribute or benefit associations are held in consumer memory
for the parent brand, that is, how easy an association might be to change.

Example

Nivea - For example, Nivea became a leader in the skin cream category by creating strong
points- of-difference on the benefits of “gentle,” “mild,” “caring,” and “protective,” which
consumer’s value in many categories. Through skilful product development and
marketing, the Nivea brand was successfully expanded across a wide variety of skin care
and personal care product categories. When it leveraged its brand equity into categories
such as deodorants, shampoos, and cosmetics, Nivea found it necessary to establish
category points-of-parity before it could promote its points-of-difference. These were of
little value unless consumers believed its deodorant was strong enough, its shampoo
would produce beautiful enough hair, and its cosmetics would be colourful enough. Once
points-of-parity were established, Nivea’s core brand associations could be introduced as
compelling points-of-difference.

C. Managing Brands over Time

Reinforcing Brands

The Brand Reinforcement majorly focuses on maintaining the Brand Equity by keeping the
brand alive among both the existing and new customers. This can be done through
consistently conveying the meaning of brand in terms of:

- Brand Awareness - What are the products under the brand? What are its core
benefits and how it satisfies the demand?
- Brand Image - How is the brand different from other brands? How it enables a
customer to make a strong, unique and favorable association in their minds?
• Brand reinforcement includes regular monitoring of a product at all the levels of product
life cycle ( viz. Introduction Stage, Growth Stage, Maturity Stage and Decline Stage) to
keep a check on the changes in the tastes and preferences of customers.
• The marketers adopt this strategy to remind customers about the brand and its long-
lasting benefits. In order to keep the brand in the minds of the customer, several
innovations, researches, and creative marketing programs are made in line with the
changing marketing trends.
Apart from innovation and research the brand reinforcement can be done through various
marketing programs such as:

1. Advertising is one of the most common and easy tool of brand reinforcement. By
showing the ads frequently on TV, Internet, Bulletins, Billboard, Radio, etc. can make
the brand deep-rooted in the minds of the customer.
2. Exhibition provides a vital platform to the brands where the product with any new
feature can be demonstrated to the customer. Products seen in real gives an
experience to the customer, and some image gets created in their minds.
3. Event and Sponsorship act as an aide to the brand reinforcement. The companies
sponsor big events like sports, political rallies, education, award functions, etc. with
the objective of reminding the customer about their product and creating the positive
image in the minds of new prospects.
4. Showroom layout also plays a vital role in strengthening the brand image in the minds
of the customer. The way the brands are placed in the retail outlets or stores reminds
the customer about the product and also influences new users through its appeal.
5. Promotion is the most frequently used tool of brand reinforcement. Several
companies adopt this strategy wherein some special offers, freebies, discounts, gift
packs, etc. are given along with the product. This is done with the intention to retain
the existing customers and attract new customers simultaneously.

An example of reinforcement advertising is the “surround session”, introduced by the online

unit of the New York Times. This model emphasises on the interaction between advertisers
and audiences. In such a session, an advertiser has all or most of the advertisements on each
page for a surfer’s entire site visit. As the surfer moves from one page to another, the same
advertiser is represented in various ad placements. This allows for reinforcement of the
advertiser’s message.

Thus, each firm tries to maintain its brand position in the minds of all the prospective
customers such that the life of the product gets extended and remain in the race of
competition.

Brand revitalisation

The marketing strategy employed when a brand has reached maturity and profits begin to
decline. Approaches to revitalisation may include one or all of market expansion, product
modification or brand repositioning.

A brand revitalisation programme involves approaches to reclaim lost avenues of brand

equity. It also seeks to identify and establish new sources of brand equity. Examining changes
in the marketing environment, competitors' strategies, consumer behaviour, evolutions of
cultures and many other factors can help determine brand erosion and aid brand
development.
The following is a framework of strategy that is used to revitalize a brand

Examples

The VW Beetle

The Volkswagen Beetle was selling successfully in the 1970s, with more than 15 million
models sold, but that popularity was short-lived. Only a few years later, the Beetle fell off the
market and remained silent for decades. But after a resurgence of “retro” 1970s fashion
trends and subsequent nostalgia, Volkswagen decided to redesign the model for a new
audience. Combining the old model’s quirks and charm with new appeals, the company was
able to revitalize Beetle sales, and the VW Beetle rose to popularity yet again.

Apple.
No list of brand comebacks would be complete with what is, arguably, the best brand
comeback story of all time. As you may or may not know already, Apple was enjoying some
breakout success throughout the late 1970s and early 1980s with the rise in popularity of the
Apple II and Apple III computers. Due to creative differences, co-founder Steve Jobs was
forced out of the company in the mid-1980s, and the brand began to fade into obsolescence.
All that changed when Jobs came back to the company in 1997, leading a massive rebranding
campaign that turned Apple into the minimalistic, futuristic tech juggernaut we’ve all come
to embrace.

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