Brand Management Report: Volkswagen Group Case Study

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BRAND MANAGEMENT

Table of Contents
INTRODUCTION..............................................................................................................3
TASK 1 BUILDING AND MANAGING BRAND OVER TIME............................................4
IMPORTANCE OF BRANDING AS A MARKETING TOOL AND ITS EMERGENCE IN
THE MARKET.............................................................................................................. 4
KEY COMPONENTS RELATED TO SUCCESSFUL BRANDING STRATEGY FOR
MANAGING AND BUILDING BRAND EQUITY............................................................7
TASK 2 BRAND HIERARCHY AND PORTFOLIO MANAGEMENT..............................13
DIFFERENT STRATEGIES OF PORTFOLIO MANAGEMET, BRAND HIERARCHY &
BRAND EQUITY MANAGEMENT..............................................................................13
TASK 3 BRAND EXTENSION AND LEVERAGE...........................................................21
EVALUATE HOW BRANDS ARE MANAGED COLLABORATIVELY & IN
PARTNERSHIP BOTH AT DOMESTIC & GLOBAL LEVEL.......................................21
TASK 4 MEASURING AND MANAGING BRAND VALUE.............................................25
DIFFERENT TECHNIQUES FOR MANAGING AND MEASURING BRAND VALUE 25
CONCLUSION............................................................................................................... 28
REFERENCES...............................................................................................................29
Figure 1: Components of Brand Equity............................................................................8
Figure 2: CBBE Model................................................................................................... 11
Figure 3: Branded House Strategy of Google................................................................16
Figure 4: House of Brand Strategy of P&G....................................................................17
Figure 5: Brand Portfolio Strategy..................................................................................18
Figure 6: Armani's brand portfolio..................................................................................19
Figure 7: Cash cow brand of Gillette..............................................................................19

Figure 8: Low entry level brand of Hero MotoCorp........................................................20
Figure 9: High end prestige brand of TATA....................................................................20
Figure 10: Brand hierarchy of Volkswagen....................................................................21
Figure 11: Brand hierarchy of P&G................................................................................22
Figure 12: CBBE Model................................................................................................. 23
Figure 13: Leveraging brand equity................................................................................25

INTRODUCTION
The process of planning and analyzing on how a brand is perceived in the competitive
market is known as brand management. Promoting positive relation with the current
market is essential to promote a particular brand. The main purpose of this assignment
is to provide proper understanding of brand management. The report will explain
numerous techniques that are useful to maximize brand value while throw some useful
real world examples that make more understanding of how to achieve effective brand
management. The first part will explain the importance of branding in the business with
analyzing the various brand strategies to build a successful brand over time. Further, it
will explain various strategies of brand hierarchy, portfolio management and equity
management by using useful frameworks. The later discussion will be on analyzing how
brands are extended internationally & domestically. At last, the report will provide
effective techniques of managing & measuring the brand.
The report will provided understanding of brand with respect to a world’s largest
automotive manufacturing company i.e. Volkswagen Group founded in 1937 at Berlin,
Germany. The company deals in large number of products from automobiles to turbo
machinery and its products are served all over the world. The company is known for its
large range of product portfolio and a good branding image (Tasci, 2018).

TASK 1
P1
INTRODUCTION
BRAND IS POWER
A Brand refers to a mark, logo, symbol or name of a company that is used by the
companies in order to differentiate their products uniqueness from other companies.
These elements can create a brand identity by getting combined. Also, when a brand is
legally protected, it refers to a trademark. Company’s brand is very essential to build a
position in the market (Rosenbaum-Elliott et al., 2015). It helps in gaining customer trust
and value on the products while helps in understanding the behaviour of competitors in
the market (Tasci, 2018). Thus, it is recognized that a brand is a most valuable asset for
any organization.
Volkswagen Group deals in manufacturing vehicles and its corresponding brands such
as Audi AG, Automobili Lamborghini, Bentley Motors, Volkswagen Commercial
Vehicles, Volkswagen Passenger Cars, Bugatti Automobiles and many more (Tasci,
2018). Also, Volkswagen purchased Rolls-Royce in 1998 and obtained right to use its
trademark on automobiles. Therefore it is considered as a Company with effective
brand value.
IMPORTANCE OF BRANDING
Branding refers to a tactical and strategical tool that helps an organization to gain
competitive advantage in the market. It is also a promotional tool that is used by the
company to promote its product in the marketplace (de Oliveira et al., 2015). A
marketing practice in which an organization creates a symbol of its identification is
referred as Branding.
Volkswagen uses the practice of Branding to shape its brand actively. Volkswagen
needs to identify the customer wants and needs so as to shape its brand as

accordingly, therefore branding helps Volkswagen in order to build deeper relation &
bond with the customers that ultimately results in gaining customer loyalty & trust while
maintaining position in the competitive market (Uggla, 2015).
BRAND EQUITY
A marketing practice that is used to describe the brand value is known as Brand
Equity. It can be only identified by the consumer experiences and perceptions with the
brand. If a customer is happy with the brand and thinks highly about it, then it has
positive brand equity and therefore company becomes able to charge high rates for the
products. The activities which are performed by the marketer highly affect the program
of brand equity (Tasci, 2018). Also, the tangible & intangible advantages to the
customer help a company to set the brand name for the products & services (de Oliveira
et al., 2015).
A globally renowned brand Volkswagen attracts the customers due to its quality of
brand. Brand Equity of Volkswagen can be determined by the services it provides to the
consumers (Steenkamp, 2017). The company’s popular & top brand is Volkswagen
Passenger Cars that was more appreciated by the UK customers and the number of
sold units of car model was 95,892 units in the year 2018. Also, a biggest achievement
of Volkswagen is its fully automated car that was most appreciated by the Europe
customers (de Oliveira et al., 2015).
DIFFERENCE BETWEEN BRAND AND PRODUCT
A product is a commodity that is produced by the business in order to make sales in the
market where brand is used to differentiate the products from others. A customer need
a product but wishes to get a brand. A company’s brand cannot be copied by other
company as it has its unique identity (de Oliveira et al., 2015). A brand is helpful for the
customer to make the best choice of the products.
COMPARISON BETWEEN PAST AND PRESENT BRANDING
Simson and Sullivan are the first authors who introduced the concept of branding in
1990s. according to them branding has three main features- firstly it is treated as an

important asset for any organization, secondly used as a forward looking perspective
and it changes the value of the company when new information arrived at market place.
In the past era, no one had well explained the relationship between marketing and
branding but it makes a huge change in 21st century. Also, today we use the concept of
brand equity to measure the value of brand and branding is now included in the
relationship theory (Steenkamp, 2017). Along with this, CSR concept has also been
more popular in the 21st century.
The following components are useful in managing brand effectively to gain competitive
advantage
Target Market
It is necessary for the company to plan effective strategy in order to determine the
customer requirements and wants. Volkswagen stands out as a leading brand to meet
the basic needs of its customer base (Steenkamp, 2017).
Identify Brand Mission
Volkswagen has the major focus of delivering its products with innovation and creativity
that creates a positive brand image in the customer’s mind. Also, its brand have set
standard in design, quality & technology and proves it by introducing safe &
environmentally sound vehicles to compete in tough market (Uggla, 2015).
Market Research
The very significant component in brand building process is the market research, which
turns out to be very essential for Volkswagen as it helps in determining competitive
strategy and therefore creates a differentiated product from its competitors (Steenkamp,
2017).
Marketing Brand
In concern with the brand promotion, Volkswagen requires to plan effective marketing
strategy (Uggla, 2015). It includes promoting through social media and integrating the
product in different market place.

BODY
P2
COMPONENTS OF STRONG BRAND
In order to build and enhance brand equity, it requires integrating the principles of the
business. A product will only consider as a strongest brand when it don’t affect the
environmental conditions and grow sustainably (Rosenbaum-Elliott et al., 2015). The
following elements are related to the successful branding strategy to manage brand at
Volkswagen.
Figure 1: Components of Brand Equity
Source: (Rosenbaum-Elliott et al., 2015)

Customer focus
As customers are an important asset to any business, it is necessary to keep focus on
them regarding their wants & needs (Uggla, 2015). Volkswagen has to put emphasize
on the current taste of the customer so that it brings a good image of the brand in the
market.
Credibility
This requires building faith & trust within customer by making proper commitment of
providing services of best quality. Volkswagen resulted in delivering best services to its
customer by adopting latest technologies as per the changing needs of consumers
(Rosenbaum-Elliott et al., 2015).
Uniqueness
If the product is easily available anywhere than it is not considered as brand, a brand
consists of its unique proposition value that differ it from the competitors. Volkswagen
stands out to be an effective brand with focused differentiation (Atwal and Williams,
2017).
Consistency
A company must maintain the consistency in delivering the brand with highest quality.
Volkswagen must adopt consistency that will help to deliver its brand in the international
market.
Simplicity
A brand must be simple and clear in order to place easy understandability of every
prospect (Rosenbaum-Elliott et al., 2015).
Authenticity
If a product is being original and genuine than it is of high value and acts as a key
element for all of its customers (Atwal and Williams, 2017).

Promise fulfillment
In order to make stability in the international market, Volkswagen requires maintaining
its promised services while building deeper relationship with its customers. This may
help in enhancing the brand equity all over the world.

CBBE MODEL
In order to build strong brand image of the products, the effective CBBE model of brand
equity is applied. Kevin Lane Keller introduced this model by defining “strategic brand
management” that is created to make a brand successful. Volkswagen applied CBBE
Model for its parent brand for the high performance and excellent finish (Keller et al.,
2011). The model involves identifying the depth of current brand while maintaining the
brand image positively. It helps in blocking salience features with high performance of
the brand.
Figure 2: CBBE Model
Source: (Keller et al., 2011)
Brand Extension
The stage at which customer services & needs are developed is called Brand
Extension. Volkswagen adopted the strategy of extension with respect to its automotive
vehicles (Heding et al., 2015). The company introduces automatic vehicles in order to
drive its growth in the competitive market.

Brand Reinforcement & Revitalization
All the company wants that their product stays in the competitive market for the long
term; therefore Volkswagen uses the strategy of Reinforcing & Revitalizing in order to
bring innovation in their product design while ensuring the brand equity management.
This may provide Volkswagen benefits for the long term (Atwal and Williams, 2017).
BRANDING ELEMENTS AND CHALLENGES
Memorability
Most of the brand elements of Volkswagen is memorized and recognized such as
Lamborghini and Audi (Carrick and Soares, 2018).
Meaningful
No brand should be meaningless, there always should be a meaning attached behind
the value of the brand (Heding et al., 2015). Volkswagen focuses on clear brand
positioning by improvement in efficiency.