Brand Management Report: Brand Strategies of Coca-Cola and McDonald's

This report delves into the intricacies of brand management, using Coca-Cola and McDonald's as case studies. It begins by defining the concept of a brand, its importance, brand equity, and the key elements of a strong brand, followed by the steps to manage and develop a brand. The report then analyzes the challenges faced by Coca-Cola and McDonald's in maintaining their brand image. Furthermore, it explores the brand's portfolio strategy, management hierarchy, and techniques for measuring and managing a brand over time. The report concludes with a comprehensive overview of the Customer-Based Brand Equity (CBBE) model and its application to the success of these prominent brands, offering insights into how they have built and sustained their market presence. The report emphasizes the importance of uniqueness, quality, and effective strategies in brand development. The analysis includes the challenges and the strategies used by both companies.

BRAND MANAGEMENT
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
SECTION 1......................................................................................................................................3
Brand............................................................................................................................................3
Importance of branding................................................................................................................3
Brand equity.................................................................................................................................4
Difference between brand and the product..................................................................................4
Key elements of a strong brand...................................................................................................4
Steps to manage and develop a brand over the time....................................................................5
Challenges to developing a brand................................................................................................5
1. Challenges faced by Coca-colaCoca-Cola...............................................................................5
2. Challenges faced by Mcdonald'sMcDonald’s.........................................................................6
SECTION 2......................................................................................................................................6
The brand's portfolio strategy:.....................................................................................................6
The management hierarchy of Coca-colaCoca-Cola and Mcdonald'sMcDonald’s:....................6
Evaluation on how brands are leveraged and extended...................................................................8
Description on the technique of measuring and managing the brand over the time......................10
CONCLUSION..............................................................................................................................12
REFERENCES .............................................................................................................................13
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INTRODUCTION
The brand management is very important technique to maximize the market share and
profitability of the firm in market. It can be termed as marketing which defines brand value. It is
mainly based on customer's perception about the brand. In order to increase the value of brands,
companies need to focus on the uniqueness and the quality of the product (Kottemann, Plumeyer
and Decker, 2018). This will greatly influence value of their brands. With the help of this kind of
technique, the brand can be developed in the market and will also have good growth and
potential in the firm. The present report will cover the following activities such as brand quality
and value, critical evaluation on the brand techniques and method of the brand measurement so
that brand of the commodities can be tracked easily. By giving the particular modification in the
commodities, they are able to maximise the profitability and productivity. For this, they need to
make the portfolio strategy so that brand can be managed effectively. In addition to this, the
major consideration is to be given over the two companies like McDonald’s and Coca-Cola. This
kind of activities will be helpful in relation to have growth in the market. Brand has the specific
identity which can be helpful in relation to gain competitive advantage in market. With the help
of this kind of activities, consumers tend to attract with the brand of products.
SECTION 1
P1.Importance of branding
Brand:By using symbols, words or logo that can identify a product and also differentiates it from
others is referred to as a Brand. When it represents a firm, it is known as brand name which can
be categorised as an asset which has to be developed by time to time. For example, Coca-Cola
and McDonald’s are one of the most leading brands in the world. They are developed as per the
needs of the consumers and also designed efficiently to make their unique position in market
(Zhou and Wang, 2014).
Branding: The process of creating an image in consumers mind of a specific product, is called
branding of that product.
Importance: By branding, a Coca-Cola actually makes customers understand about themselves
who they are. Although branding is way tougher today, but it is equally important too. The
creativity of branding, the words and the elements which a company uses can highly influence
the branding. It makes the higher level trust in customers and gives a better identity to company.
By branding, each of both the companies made their presence felt to the world. In order to
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become a profitable company whether it is small or large like McDonald’s or Coca-Cola, they
have been established themselves as strong brand builder (Zhu and Chung, 2014). In today's
world, it is very challenging to stand apart from others and in order to do so, branding can be
very helpful. It is also important to give a clear idea to staff members about requirements and
needs of the customers and they will act accordingly to satisfy their needs as well as to get more
profits to the company. In addition, if a company do branding, it will create referrals about what
they are among people and will become more known publicly and also add more customers.
P2. components of successful brand strategy
Brand equity: Brand equity means how a company has established itself by its brand or product.
It is the ability of a particular brand that keep customers attract and retain their interest in it. It
can be called as a marketing term which defines the value of a brand. It is based on customer's
perception about the brand. It can be categorised in two parts, if people think of it as a high
quality, it is considered 'positive brand equity', on the flip side if they consider it to be a low
quality, it’s been called 'negative brand equity' (Lilleker, 2015). In order to get more of the
positive brand equity, McDonald’s and Coca-Cola transfer the equity to the line extensions. It
helps them to improve their stock price too. Although, these companies have already a positive
brand equity, both Coca-Cola and McDonald’s have been increased the prices of their products
to gain more profits for the company and for maintaining it, they are also focusing on the brands
to make positive equity for them. For example, the value of brand equity of Coca- Cola is
estimated at $81.6 billion in 2013 which is far more than other soft drink brands.
Difference between brand and the product
There are some basic differences of the brands and products of a company. Companies
make the products while after the perception which is made by their customers, the products
become brands. The product can be replaced by brands but brands can't be replaced. Products are
referred for what they can do for customers whereas brand creates attachment for it among
customers. For example, Coca-Cola sells beverage as a product, but In spite of the arrival of new
companies with new beverages, it became a very popular and world known brand over the time
by perceptions of the consumers about it (Napoli and et. al. 2014). Same can be said for
McDonald’s also which is a leading food brand that sells burgers, sandwiches according to the
customer's need and also maintains the hygiene level of the food. It also became world famous
brand. This was the major difference between brands and products.
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Strong and weak brands: Strong brand means the reputation or the visibility of as a brand in
market. If the image of a brand is very good, then it is called strong brand. On the other hand if
its image is poor among market and customers then it will be called weak brand. For instance,
Coca- Cola can bee categorized in strong brand. Because, it has managed to retain its market
over the years and also it has managed to be on top among other beverages companies. It earned
the trust and brand value to remain that strong till now.
Key elements of a strong brand
 Both Coca-Cola and McDonald’s have strong brand values.
 In order to get this much success, other companies should follow their strategies to
increase their brand values.
 The purpose for which the brand has been made, need to be very clear.
 The companies need to target the large number of customers who are likely to buy their
products.
 In order to increase brand value, companies need to focus on uniqueness and quality of
the product. This will greatly influence the value of their brands.
 The brand needs to contain a very attractive and concise tag line with it. It will help to
understand about what the brand delivers (Peppard and Ward, 2016). These tag lines have
to be short, powerful, easy to understand and most importantly, different from other
competitors.
 For example, Coca-Cola has the tag line- “Open happiness” and so the McDonald’s- “i'm
lovin' it”.
Steps to manage and develop a brand over the time
There are various strategies to develop a brand over a period. In order to do that, the
companies Coca-Cola and McDonald’s have differentiated the brands properly to grow in a
period. They know what type of clients they are targeting. They are not diverse, instead they are
narrower to get faster growth. Also, the companies are required to determine the position of their
brand that. They need to be aware of making their brand stand out from other ones, so that they
can get popularity among all other brands. Also, a company should do enough market research
before doing any efforts. Though, both Coca-Cola and McDonald’s are one of the biggest brands
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in the world but still, they also need to do more efforts to maintain their position as other brands
like KFC, Sprite, Mountain Dew etc. are their tough competitors (Huang and Sarigöllü, 2014).
CBBE model of The brand development
This model is known as CBBE model, which is “Customer Based Brand Equity”. By the
time, customers had become the main priority for Coca-Cola and the McDonald’s. In order to do
so, they made their customer happier and started gaining more profits. The CBBE model makes
the companies enable to create brand equity which is essential to develop brands according to the
needs of the customers and then implement the strategies (Zhou and Wang, 2014). These are the
levels of CBBE model:
11 Identity of the brand: - It is the customer's way to look up at the brands and how they
differentiate them. It is required when the customers are not aware of what the brand is.
This is the most important step of the brand development. It is the base to make the brand
stronger. Big companies like Coca-Cola and McDonald’s spend millions to advertise
their brands and create brand equity and so is brand development(Zhu and Chung, 2014).
For this, they arrange big campaigns and advertisements to get big profits.11 Meaning of the brand: - Once the customer is aware about the brand by first level, they
want to know more and more about the products they offer and want to find the
reliability, the customer service etc. which can be achieved by two things that are
performance of the brands and image of that brand. Companies like Coca-Cola and
McDonald’s now become the most trusted and loved brands because of their performance
and their image in market.
1. Challenges faced by Coca-Cola
Brands are to be considered as the long term assets but the marketing and sales
professionals treat them as a short term asset which is the biggest challenge for Coca-Cola
because even if it might become the biggest brand in the world in a very short period of time, but
now, it has become less popular, for not being treated as a long term asset.
Also, the challenge is to be in game consistently, that is, it needs to work consistently
towards maintaining its brand value and growth. This is because by the time, competition has
been increased drastically.
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2. Challenges faced by McDonald’s
The image of food of McDonald’s is being damaged because of using low quality
ingredients. They have slow services and inclined towards inaccurate orders (Ugend and da
Silva, 2014). Also, the rising prices are also lowering its brand value because same items are
being provided by other brands also in less price and this is affecting the sales of McDonald’s.
Moreover, staying in current trends has become a challenge in today's world which is also a
threat for McDonald’s.
SECTION 2
The brand's portfolio strategy:
In order to do this, the brand role has to be very well defined. For the companies Coca-
Cola and McDonald’s, each brand has to be managed actively to play its role correctly. The
resources which these companies are providing are need to be based on the roles and not on
profits along with sales which they are getting currently. They need to identify the main brands
that will play a major role for success of the companies in the future or it can be said that they
have to identify the products which will drive the success of these two companies to the next
level. They need to understand how the new offerings and the sub- brands will get them the
profits and how to endorse them apart from the main brands (Napoli and et.al., 2014). The
companies Coca-Cola and McDonald’s are need to be focused on the new business strategy
which will specify the growth of product-market. These firms are required to make
discriminator of brands. They need to organise technologies, services and ingredients to get a
meaningful differentiation. Furthermore, they can connect with a more powerful corporate brand
in order to get strategic brand portfolio. They can also do reduction of their brand portfolio on
time when it is required.
Brand reinforcement:It means how the company or organization maintains the brand equity by
retaining its brand alive in the new as well as existing customers. This can be done by brand
awareness and brand image.
Brand revitalization: It is a marketing strategy which is adopted at the time when the brand is
falling by the time in market in the terms of its life and profits which are made by company
through it.
Strategies on brand reinforcement and brand revitalization:
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For brand reinforcement:- In order to do brand reinforcement, the company needs to maintain
its market reputation by the time. For this, companies can make the brands consistent among
customers and this will improve the perception of the customers about that brand. They should
also need to work on the uniqueness of the brand. For example Coca Cola:- “Open happiness”.
For brand revitalization:- For a company it is very important to know about their managerial or
marketing actions which can be result in brand revitalization. In order to achieve this, it is
important to redefine it with its brand essence. It can also be achieved by changing brand
elements so that consumers get to know that the brand has got a new meaning. For example, Mc
Donald's:- “m lovin' it”.
management hierarchy of Coca-Cola and McDonald’s:
The brand's nature is intangible and it is treated to be an asset to any product. Brand
management hierarchy is about finding growth and performance of the company. Coca-Cola and
McDonald’s come with the logos and colours with text associated with them for the good
management of their brands (Lilleker, 2015). By means of brand hierarchy, both the companies
summarise their brand strategy by knowing the nature of their common and distinct brands and
by displaying their numbers. It also includes branding of individuals or can be called multi-
branding. This will give each product a new image. Both Coca-Cola and McDonald’s have
simple logo(s) that gives freshness and uniqueness to their brands.
The brand Hierarchy of Mcdonald’s and Coco-cola are very effective they are running their
business oppression with the help of the effective structure so that they able to enhance the firm
profitability and the productivity. The function can be perform in the effective manner if there si
support of the efficient leader and managers. In this the Mcdonald’s is using the tall structure
beacuise it is more helpful in relation to achieve the thing in the more professional manner. This
kidn of the activities are helpful in order to attend the various objective of the firm.
3. Response for the brands:-
On this level, companies get to know what types of the responses are coming from the
customers. If the brand meets their expectations, the customer feels happy and tends to buy more
and if it goes beyond the expectations, it creates a very positive word-of-mouth among people by
which the companies get huge profits (Huang and Sarigöllü, 2014). Coca-Cola and McDonald’s
did the same as they created a huge amount of positive word-of-mouth in a very short period.
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11 Response- this is the step in which the image of the brand is need to be identified in the
eyes of the person. In this the company need to understand the feeling of the customer so
that they are able to earn large amount of the profitability and the productivity.11 Relation- this is the last step and it is the most typical part of the brand equity
management. In order to make the better relation with the customers the firm need to get
ensure the overall working of the business so that they are able to deal with the function
of the management in effectively manner.
4. Resonance of brand:-
This means a strong relationship between the brand and the customers. It is the level in
which the brand connects with the customers on psychological and social level. The brands
Coca-Cola and McDonald’s fall under this category (Jugend and da Silva, 2014). Very few
brands can come this far. Both Coca-Cola and McDonald’s are the best examples of the CBBE
model. At this level, the customer is not the only one who connects with the brand but by the
strong word-of-mouth of the product, various customers connect to one another as well. When a
brand reaches at this level, it creates loyalty, regularity and a level of trust among the customers
for the brand. This drastically increases the rate of purchase and gives maximum profits to the
company.
Overall, this model can give the clear idea to the company where they stand in market and
how they can increase their level to reach at the highest in this model. It actually provides the
ways to build the equity of their brands. Although, it is very tough to cross each of its levels by
moving into it. This is because it demands lots of efforts, market research, good knowledge and
skills to reach at the top level of the CBBE model (Napoli and et. al. 2014).
Evaluation on how brands are leveraged and extended.
Brand leveraging is the strategy which is helpful in relation to take entry into new market.
The leverage means to earn the potential gain from the market. In order to gain the competitive
advantage, they use to gain the maximum market share. The brand is the specific identify which
will be helpful in relation to gain the competitive advantage in the market. With the help of this
kind of the activities the consumer can attract with the brand of the products. This kind of the
strategy will be helpful in order to get success in market (Kottemann, Plumeyer and Decker,
2018). This kind of the factor will be helpful in order to gain the competitive advantage in the
market which will be helpful to have succeed position in the market to have growth of the firm.
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In this way, instead of establishing a new entire brand and the product, the firm need to make
promotional awareness and effective distribution in order to get success of the product. By
bringing the product variants, they need to use specific tools so that they are able to make their
product successful in the market. The brand leveraging is very helpful in order to expand a
product in the market so that their product can capture long share in the market. Coca-Cola is
using the brand leveraging product in relation introduce their goods in the market. This is really
very important in relation to get the profitability of the products because it creates the sense of
familiarity with the customers which will be helpful in order to carry positive brand
characteristics and can develop product in the market. The customer with favourable brand
opinion will convince them to try new product which is going to introduce in the market because
they believe in the quality which is added with tag line of brand. The brand is the specific
identify which will be helpful in relation to gain the competitive advantage in the market. With
the help of this kind of the activities the consumer can attract with the brand of the products.
On the other hand, McDonal’s is using the leverage method in relation to introduce new
commodities in the market. With the help of this kind of system, they are able to get success over
new a commodity which is coming in market with the new addition in taste so that customer will
take the product. The main aim behind adopting the brand leverage techniques is to take the
advantage which gives power to brand commands rather than building new brand in the market
so that there is no need to invest huge capital to introduce commodities in the market. There are
three techniques given in relation to brand leveraging which are as follows-
Brand stretching- with the help of this, the firm can have an opportunity in relation to
enhance the value of the product in the market. This can be done with the help of existing brand
name of the commodity in the market. With the help of this, they can add value to the segments
as well. The reason behind involving in the brand stretching is as-
1. With the help of this, existing market can be stretched out.
2. They can have more opportunity to get enough publicity in the market which can add
value to the brand in an effective manner.
3. With the help of this, they are able to cope up with the competition in the market.
Line extension- with the help of this they can add product formulation to the commodities in
order to reach out the customer in the market. Line extension keeps focusing over the minor
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modification in the product (Marquardt and et.al., 2017). Through this kind of innovation, they
are able to bring competitive advantage in the market.
Brand extension- This is very helpful in order to introduce product in the market with the
established brand name.teh product brand which is extended can be related or unrelated to the
existing brand name. This kind of system will be helpful in relation to bring popularity in the
market. Through the given strategy, the customer would likely to accept these commodities in
the market. This approach will be helpful in order to get success in market.
With the help of the extension they are able to make more publicity of the existing brand in the
market. This will be more helpful for both the firms like McDonald’s and Coca-Cola rather than
using the brand name and having efforts to make it popular. These kinds of the method will b e
helpful in relation to give more identical approach to the customers so that they are able to
capture long term share and profitability from the market (Pappu and Quester, 2017). The diet
Pepsi has been introduced in the market so that firm can have good customer approach. They can
give major focus over the taste of the products so that firm can Able to take effective action in
order to gain the sustainability in the market. With the help of this kind of the technique the
Coco-cola and McDonald’s did the same, as they created a huge amount of positive word of
mouth in a very short period.
Description on the technique of measuring and managing brand over time.
It is very important to measuring the brand in the market in order to know its position and
rivalries so that if there is any obstacle than firm is able to cope up with it. This kind of the
system will be helpful in order to generate more opportunities in the market (Rosenbaum-Elliott
Percy and Pervan, 2015). the various kind of the brand measurement techniques are given such
are as-
1. Market share- This is one of the potential factor which will be helpful in order to know
about current status of the firm in market. Both the firms like Coca-Cola and McDonald’s
are capturing the great amount of the market share. This kind of technique will be
supportive in order to grow size of market (Pappu and Quester, 2017). This kind of teh
factor will be helpful in relation to introduce the market with unique product under the
same brand.
2. Customer feedback- This is one of the most important technique in order to get the
valuable feedback from the customer. In this, they need to give the feedback to the
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customer in relation to identify the loop falls in the commodities available in the market.
By knowing the customer opinion, they are able to find out the variation which can
enhance the value of customer in the market. By analysing the effective evaluation they
can able to bring improvement in quality of the commodities (Christodoulides, Cadogan
and Veloutsou, 2015).
3. Purchasing intent- with the help of this kind of the factor they are able to know the kind
of the products are customer needs to desire for in relation to make the good approach to
commodities in the market. With the help of this kind of strategy, the firm is able to
develop strong brand image in the market. By developing product in the manner which
can satisfy the need of the customer, than this kind of the technique can bring the strong
and identical position of the product and the brand image in the market can be enhanced.
The companies Coca-Cola and McDonald’s are need to be focused on the new business
strategy which will specify the growth of product-market. The companies are required to
make a differentiator of brands.
4. Brand equity audit- with the help of this the firm can able to set the audit function which
will be helpful in order to knowing any loop falls (Ross and Hajjat, 2016). This is need to
be done in the timely manner by scrutinizing the whole things in the manner. The audit is
need to help in order to find out the essential things which is need to be changed with the
help of there can be enhancement in the profitability and productivity of the firm. The
McDonald’s and Coca-Cola is using is going to launch the new product in this way they
need to take brand equity audit in relation to find out the quality of the product. If they
are satisfied with all the things than they will allow to introduce product in the market
with the using of same brand (Kottemann, Plumeyer and Decker, 2018). These kinds of
feature are attracting in order to gain the attraction of the customers.
5. Brand tracking- this kind of the function is helpful in order to know the status so that
things can went in the well manner. The quality of the product need to be tracked so that
thing can be better and firm can operate its function in the better and effective manner.
The customer with favourable brand opinion will convince them to try new product
which is going to introduce in the market because they believe in the quality which is
added with tag line of brand (Buil, Martínez and de Chernatony, 2013). This kind of the
feature attracts the customer in order to purchase the product. This will be helpful in
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