Brand Management Strategies: Building and Leveraging Brand Equity

Desklib provides past papers and solved assignments for students. This report analyzes brand management strategies.

Brand Management
1

Contents
Introduction................................................................................................................................4
LO1 Demonstrate an understanding of how a brand is built and managed over time...............5
P1 Explain the importance of branding as a marketing tool and why and how it has
emerged in business practice..................................................................................................5
P2 Analyse the key components of a successful brand strategy for building and managing
brand equity............................................................................................................................5
M1 Evaluate how brands are managed successfully over time using application of
appropriate theories, models and concepts.............................................................................6
M2 Apply appropriate and validated examples within an organisational context.................7
D1 Provide a critical evaluation that is supported by justified evidence demonstrating a
comprehensive understanding of branding within an organisational context........................7
LO2 Analyse how brands are organised in portfolios; how brand hierarchies are built and
managed.....................................................................................................................................8
P3 Analyse different strategies of portfolio management, brand hierarchy and brand equity
management...........................................................................................................................8
M3 Critically analyse portfolio management, brand hierarchies and brand equity using
appropriate theories, models and frameworks.......................................................................9
LO3 Evaluate how brands are leveraged/extended over time domestically and internationally
..................................................................................................................................................10
P4 Evaluate how brands are managed collaboratively and in partnership both at a domestic
and global level....................................................................................................................10
M4 Critically evaluate the use of different techniques used to leverage and extend brands.
..............................................................................................................................................10
LO4 Evaluate techniques for measuring and managing brand value over time......................12
P5 Evaluate different types of techniques for measuring and managing brand value using
specific organisational examples?........................................................................................12
M5 Critically evaluate application of techniques for measuring and managing brand value
in relation to developing a strong and enduring brand?.......................................................13
2

Conclusion................................................................................................................................14
References................................................................................................................................15
3

Introduction
The branding process of product is very important for a company. Before the introduction of
this process the company would have to decide on a number of things. Different models and
theories can be used to discuss on how branding can help for advertising. These models can
also show how to improve the branding at different levels. Portfolios and hierarchies are used
to show how the branding can be achieved. There are strategies for both portfolios and
hierarchies which should be used while branding for a products. Also what should be kept in
mind is brand equity management that would show how the brand is performing in the
market. Brand extension and leveraging is used by business when they want to extend into a
new market or start a new product into an existing market.
4

LO1 Demonstrate an understanding of how a brand is built and managed over time
P1 Explain the importance of branding as a marketing tool and why and how it has
emerged in business practice.
Branding has been used as a marketing practice in the growing business world. Branding
became noticed by some companies around the 1950’s through which these companies
started to gain goodwill. A company such as Unilever which deals in consumer goods was the
one which started to do this so it could gain advantage over its competitors. There are
different factors on why branding can be considered as marketing tool:
1. One of the main points is that the company will gain more recognition through its
brand. A logo of a company is usually its brand that helps the consumer in
recognizing what brand the product is from.
2. Branding will help create a trust between the company and the customers.
3. Branding helps in giving the company more opportunities.
4. Branding can help support the advertising process.
5. New customers are added if they start to see a product with a brand being used
everywhere (Brandingmag, 2015).
P2 Analyse the key components of a successful brand strategy for building and
managing brand equity.
Brand equity can be described as the value of a brand in the market. Good brand equity is
developed over a long period which takes proper planning of a strategy. The strategy would
help in creating a strong brand that will keep on attracting more customers and also for
creating a high reputation for the company. Here are some of the key components of band
equity that can be used for both making and managing a brand equity strategy:
 The first thing which should be seen is the brand loyalty. See how many loyal
customers are associated with that brand. If there are low customers then the brand
equity will be low and if there are high loyal customers then the brand can keep on
expanding.
 Another key component of brand equity would be that how many people are aware of
the brand.
 Brand association is what the customers think about the brand. It shows what type of
audience is associated with the brand (Beyond Brand Building, 2015).
5

M1 Evaluate how brands are managed successfully over time using application of
appropriate theories, models and concepts.
Keller’s brand equity model can be used to manage a brand. A brand is mostly managed and
measured through its equity. The company needs to know what the customers think about the
brand.
(Marketing91, 2018.)
The first thing what customers see is which company is the brand associated with and how is
the reputation of the company. The second part of the pyramid shows what type of image is
present in the customer’s mind of the brand or the company. In the third part the customer
uses the product and then makes a perception about the other products the company produces.
At the top of the pyramid is when the customer becomes fully loyal for the brand. This a hard
stage in which many companies fail to reach.
The theory of brand loyalty is similar to the model as it shows the psychology of the
customer that they have toward the brand. The customer can have various attachments with
the brand being emotional or interactive.
6

M2 Apply appropriate and validated examples within an organisational context.
By using Keller’s brand equity model, Unilever’s branding can be discussed. The first stage
in the model is describing who the company is. Unilever is a consumer goods company that
deals with in a variety of brands. Each of these brands would directly be linked with Unilever
whether the brand’s performance is good or is very low. The second stage in the pyramid is
that how the customer perceives the brand. This includes whether the brands that are
produced by Unilever are performing well and how does the customer think of the company.
This is necessary as if the brand has a good image then the company would plan on
expanding its business. Unilever has a number of brands in different markets which show that
the company has a loyal customer base. The third part in the pyramid is how the customers
judge the brands. If the brands are judged well then their sale will be high and Unilever will
benefit. The last stage in the pyramid is of being recognized worldwide. Unilever is known
everywhere in the world as it has join ventures as well as subsidiaries across the whole world.
It is very tough for companies to reach this stage as they need to be recognised by every other
person.
D1 Provide a critical evaluation that is supported by justified evidence demonstrating a
comprehensive understanding of branding within an organisational context.
Unilever is a consumer goods business with its branches spread across the world. It has many
brands associated with it. One of the steps taken by Unilever is to do a research on the brand.
It does a concept testing to see how the brand will perform in the market. It takes surveys
from consumers and based on the feedbacks makes adjustments to its brands. Then it is
communicated by storytelling which is Unilever’s most used technique of communication. At
last the keep on monitoring the brand and see how it is performing in the market.
7

LO2 Analyse how brands are organised in portfolios; how brand hierarchies are built
and managed
P3 Analyse different strategies of portfolio management, brand hierarchy and brand
equity management.
There are different brand portfolio management strategies which can be used for betterment
of the brand.
 House of brands: in this strategy a company has many brands that are associated with
it. These brands cannot remove themselves form the parent company. The must be
associated with the parent company at all times. Also the parent company cannot
disregard a brand if it is not preforming well. An example of house of brands is
Google because it has sub brands like Gmail, Google Drive, calendar etc. that are
present with Google.
 Top-Down Model: this is when companies analyse the market to see which sector and
industry is doing well in the economy.
 The bottom up approach ignores the market and the focus is based on how strong the
company is financially.
 In passive portfolio management the whole focus is on the market and how it is
performing at that time. Also is this portfolio money is put on big and expensive
stocks that may or may not provide high returns in the future. This strategy is risky as
it is not know that the company will make a profit each time (Portfolio Management,
2019).
Management of brand equity also requires a lot of strategies that can keep it on the high side.
 The foremost thing would be maintaining a brand image so that the customers can
find it easy to pick out the companies brand.
 If a brand is strong then it needs to expand into other domestic as well as international
markets so the brand can create awareness.
 The use of social media has been increasing day by day. Companies should focus on
marketing their brand on these social media platforms.
Hierarchy strategies are also necessary for brand management:
 Umbrella branding is when there are many products that are sold under one
company’s name. This type of branding is also known as family branding as the
8

company and its brands act like a family meaning that the brands cannot detach
themselves from the company.
 Individual branding is when a new brand is created and it is not connected or
associated with any of the other brands that are present with the company.
M3 Critically analyse portfolio management, brand hierarchies and brand equity using
appropriate theories, models and frameworks.
Portfolio Management Theory.
Dow Theory purposed by Charles Dow show how the market is performing. It sees the past
share market and does proper analysis of it so the future trends can be predicted. It also sees
the day to day market trends so that it can properly manage its brand portfolio. Dow also gave
the Random Walk Theory in which the stock exchange is studied carefully and critical
analysis is done on the price movements.
Another theory which is used in portfolio management is modern portfolio theory. Harry
Markowitz gave a theory that sees the securities that a company holds and then decides the
portfolio. It uses statistical data in arraign the securities of the company. It makes sure that
the portfolio is efficient and makes the highest amount of return with minimal risks involved.
Brand Hierarchy Theory.
Hierarchy-of-effects theory is a model in which a model is designed so that advertising of the
product can be done effectively. This theory helps in creating brand awareness for the
product and the company. The theory contains different stages:
 The first stage is when the customer is informed about the product
 The second stage consists of what the customer presumes about the products.
Whether they have any complaints regarding the product or any improvements they
want added to the brand.
 The third stage is when the company starts to advertise their brand according to the
feedback from the customers (Builtvisible, 2018).
Brand Equity Model.
Keller’s brand equity model also known as the customer based equity model is the most one
referred to while discussing brand equity. This equity model helps in creating awareness for
the brand and also creates a loyal customer base for the brand. The other thing that is
provided by this model is it will keep the brand consistent in the market. By maintaining
consistency the brand will start to get more customers and also its awareness would increase.
9

10

LO3 Evaluate how brands are leveraged/extended over time domestically and
internationally
P4 Evaluate how brands are managed collaboratively and in partnership both at a
domestic and global level.
In a partnership a brand serves both the companies. If the brand performs good then both the
companies would benefit and if the brand is not good then the image of both the companies
fall. The way for a brand to work properly in the economy is if both the companies work
together. They should choose on common goals so that the brand which is created can
achieve these goals. When creating a brand if one of the partners is creating the brand then
they should be encouraged. This encouragement would be a motivation so that the company
can create a good brand that will bring profits to both of the companies. Both of the
companies would need to help each other out in filling the weaknesses that are present. This
would help in a way so that the brand created does not face any issues or risks. In a joint
venture the brand should be managed in the same because deciding on similar goals would
see if the brand will gain profit in the market. Also the ways that the goals should be achieved
should be discussed so that they can be achieved in a similar manner that both the companies
agree on. Both of the companies should decide on the strategies and techniques that will be
used to the brand so that no issues occur when the brand does not perform well (Forbes,
2018).
M4 Critically evaluate the use of different techniques used to leverage and extend
brands.
There are techniques which a company can use to leverage and extend its brand. Here are
some techniques that can be used by a business to leverage its brand. The first strategy would
be to make the product quality better than the rest of the companies so that the brand gains
more popularity. The best way to do this would be to figure out which market can the brand
be leveraged in is to do a thorough analysis of each market and then enter it. The technique
can be to understand what the customer wants. Create a targeted audience in which the
product is to be introduced and also first try it on an audience to see if the product will be a
success or not. Make sure to ask an expert to find out whether the company should use
leveraging to extend its brand. Another risky technique would be to introduce the brand with
11

the help of a brand that is already present in the market. This is known as brand
appropriation. This is considered to be a risk as if the new brand does not work it will hurt the
image of the original brand that was used to help it out (BrandaNew, 2016).
Brand extension can be done through a various techniques which can either benefit the
company or make its value go down. One technique would be to form a joint venture, by
doing this the brand would be introduced into another market and would create a new image
for itself and the company. Another technique would be to launch a new or existing product
into a new market. This will be an extension as the brand would be entering into a new
market. Brand licensing can be used as it will give the company to enter into new markets.
The easiest way to extend the brand would be through line extension. This means introducing
new products in the same existing ones rather than creating a new market for new products.
Brand leveraging and extension is a risky process and should be implemented with proper
care and also with proper techniques (Women On Business, 2018).
12