Branding

Why does it matter?

[mercykare]

MANAGING BRANDS: MAKING DECISIONS IN DIFFICULT SITUATIONS

For the past few years, I have taken a couple of long haul (six hours or more) flights. I would say my biggest concern on these flights is comfort (of course after safety). I'm sure a number of long-haul flyers agree with me. For airlines, comfort (or perceived comfort) is a differentiator and source of competitive advantage (this is why I'd fly JetBlue over SouthWest any day and why I'd fly Emirates over Delta for a long-haul flight). Further, some researchers (and some passengers like myself) believe that increase in comfort decreases anxiety. 

"Global Business Travelers Association found that while 84% of first-class and business fliers value safety most when choosing a carrier, 67 percent said that having a seat that fully reclines is also important.These bed-like seats on long-haul flights allow passengers to hit the ground running, instead of spending a day recovering from a sleepless flight." ~ FareCompare

"43% of passengers surveyed deem adjustable seats as a key source of comfort." ~ Airbus

So what does this mean for Singapore Airlines as it deliberates on the decision to implement lie-flat beds shortly after 9/11? Should they make the investment or save to make sure their top-line looks decent given that the number of passengers flying is declining? They should definitely invest in the lie-flat beds! Their investment will make travel more comfortable and reduce anxiety of flying for their premium customers. If premium customers are flying then economy flyers will not keep away. This is a long-term investment that may result in a decline of short-term profit but will increase premium customer retention for the long term.

Photo credit: Airbus

[mercykare]

MANAGING BRANDS: PURSUING A MULTI-BRAND STRATEGY

Photo credit: Veritas

Good wine is an aspirational good and an indicator of social status and upward mobility. Middle class consumers are willing to pay a premium for luxury (in this case i'm considering premium wine as a luxury) in a bid to get some social proof.

So what should Concha y Toro (a Chilean wine company trying to build global brand equity) do? They should focus on building their brand in the premium segments. When they have a firm hold in the premium segments and have created a name for themselves they can then develop "value brands" that taste great at a more affordable price. This strategy has been adopted by a number of global luxury brands (think Dior, Cartier and Coach). These brands are in the business of selling dreams and in recent times have developed products that cater to ultimate, aspirational and accessible luxury consumers. However, they first developed strong luxury brand equity before they could cater to the mass market. 

[mercykare]

BUILDING BRANDS: DIFFUSION & ADOPTION

What determines the diffusion of a product/ brand? Everett Rogers created a model that has five attributes that help marketers predict how well a product will do. These attributes are relative advantage(advantage over existing option), compatibility (consistency with existing values), complexity (difficulty to understand and use), trialability (ability to experiment) and observability (visibility of value).

Based on these attributes we can predict how four products created in 2001 were supposed to perform and compare the results with what actually happened.

Based on the above results, it's very clear that diffusion depends on consumers perception and understanding of a product. But other factors also affect diffusion such as culture, technology, etc. It is important for companies to research these factors before they dive fully into a product launch.

In conclusion, Rogers' model can help to predict diffusion of a product and can be used as an initial starting point for marketing research. 

[mercykare]

On Beer and Building a Brand

I'm not a beer drinker - I can't stand the taste. But most social settings I end up in are ruled by beer drinking. Most people I know drink Heineken - I don't know if it's because of its taste or image but I suspect its because of Heineken's image. My understanding is that Heineken is a beer for a sophisticated adult who knows what they want and knows how to get it. I could be wrong but I highly doubt it. Corona on the other hand is considered a fun beer more synonymous with the good times (and also that lime slice). In my opinion, both beers taste the same (I've had a sip here and there) but the difference lies in their marketing. While both sell lifestyle marketing, they sell different lifestyles. Corona sells a more temporal lifestyle of vacation and fun while heineken sells a more permanent sophisticated lifestyle (I don't see a CEO buying a Corona in a public setting). So what lifestyle would you buy? I'd definitely go for sophistication any day. 

In case you were wondering what type of beer drinker you are, here is a Buzzfeed survey to help you figure that out. I got some Belgium beer (Belgian beers usually taste better than their counterparts - and how true is the description?!)

[mercykare]

The Power of Branding

I love bags (all kinds) but I have never been the type to buy a bag just because everyone else has one. Until recently. A couple of months ago I bought a Longchamp tote bag after a friend of mine gushed about its utility and durability while still remaining fashionable (I swore I would never carry a backpack during business school). I resisted buying one for the longest time since every female seemed to be carrying one but I always wondered why the bags were so popular. After talking to my friend about the bag, I quickly realized that the bag appealed to a demographic of women that I considered myself a part of. Just by looking at my bag, colleagues, friends, networking associates and future friends could place me and hopefully feel comfortable approaching me. Now that’s the power of a brand – not only does a brand promise certain features or characteristics to the customer, it also says something about the customer.

Extrapolating this to the power tools industry (I know – tools and fashion bags don’t mix but humor me). Tools say something about the tradesmen (probably something along the lines of “I know what I am doing”). Therefore if tradesmen think B&W doesn’t show that professionalism for tradesmen then they won’t buy B&W tools despite their great quality. So what should B&D do? In my opinion, they should get a brand ambassador (someone like my friend, probably more popular and rugged and all those other characteristics of tradesmen). Someone highly regarded in the tradesmen’ industry who will show that B&W is every bit (pun unintended) as good as Makita and Milwaukee or even better.