Building Brand Equity: Strategies and Case Studies in Marketing

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BRAND IS POWER
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List of Figures
Figure 1: House of Brands.............................................................................................................................9
Figure 2 Branded House................................................................................................................................9
Figure 3: Virgin Group Logo.......................................................................................................................10
Figure 4: Virgin Group Hierarchy...............................................................................................................11
Figure 5: Line Extension vs Brand Extension.............................................................................................13
Figure 6: Metrics of Brand equity................................................................................................................17
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Introduction
Brand is a name that distinguish the products or services of company from other companies.
Various categories of products are manufactured by a company under a brand name. In
marketing, brand equity is also known as brand value. The important factors involved in
determining brand value are customer experience and their perception towards the brand. A
positive belief of people towards a brand gives a positive impact on brand equity. To build a
successful brand it is important to create loyalty between customers. A successful brand always
has strong connection with their customers. If branding of product is done strategically, it can
impact on sales of product. A successful brand always goes through the stages of Determining
their target audience, proper brand mission, competitor research, creating value proposition,
determine brand guidelines and proper marketing.
In order to build brand equity, marketing programs play a significant part. The products to
market, their prices and delivery channels are discussed in these marketing programs. These
marketing programs holds a great importance in generating brand awareness and brand image
among people. Marketing is done in the form of advertisement.
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According to Elizabeth (2015), Branding is a crucial practice in marketing process in which the
company creates a symbol, name or design that help the company to distinguish their product
form other companies. It helps in identifying if the product or item belongs to the company or
not. Branding is not only about name or design it is also a way to create a memorable impression
on customers. It gives hope and expectation to the customer of what they can expect from the
company. Brand is representation of a business and it helps in distinguishing your company from
the competitors.
A Brand is developed from years of hard work and through means like advertising, logo,
reputation and services. All these factors help in creating a unique profile about a brand.
Branding is important as a marketing tool because it can create a huge impact on the product and
services of the company. It can change on how people perceive your brand and helps in creating
awareness among more people. To have a successful branding it is important to identify the
target market. A proper research should be conducted first to identify what a consumer really
wants from a product or service. Branding as a marketing tool helps in establishing the
credibility of product. It tries to create a loyal customer base and to connect with customers
emotionally. In other words, Branding is a way with which brands try to create a identity and
bond with their target market. (Marion, 2015)
Branding emerged as business practice because it can: -
Get Recognition: -
The reason why branding has emerged as important business practice because it is a way through
which a company get recognition among the people and their loyal consumers. When it comes to
branding, logo plays a very crucial role as it acts as a face of a company. This is why designing a
logo has an important in the initial phase of company. The logo of brand should be simple,
powerful, easy to memorable and should make an impression in first sight.
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Increase Value of Business
Branding is essential when attempting to create future business, and by providing the company
more leverage in the sector, a heavily defined brand can boost the value of a business. This
makes it a more attractive investment opportunity due to its strongly defined marketplace
position. (Elizabeth, 2015)
It helps in Generating New Customers
There will be no problem for a successful brand to free referral and mouth publicity. Strong
branding usually implies that customers have a trustfulness and favourable sense of the company
and they are likely to do business with you because they are familiar with you and trust your
product and services. They know that you wouldn’t compromise with the quality of service and
product.
Support Advertising: -
Another element of branding is advertising, and advertising policies will directly represent the
brand and its intended depiction. During advertising brands generally show the satisfaction of
large base of their loyal customers to attract new customers. When advertising fails, branding is
what that help to gain more customers.
Create Trust with Consumers: -
The business can create confidence within consumers and prospective customers through
professional appearance and well-developed branding. Nowadays, People tend to do business
with a company that is polished and professional. A proper branding can generate a positive trust
factor among people for your company, its offered product and services. (Marion, 2015)
Generate Pride and satisfaction among employee: -
Employees try to associate for a long time with a strongly established brand, they get more pride
to work in that brand. Employees feel more satisfied and enjoyable working for a strong brand
and it gives them high regard.
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According to Keller (2016), The Brand Equity is a term used in the widely marketing sector
which defines the importance of the brand, it is simply based on the concept that an proprietor of
a well-known brand can simply produce more income from brand recognition (means they can
sell the products just by the brander name), it is also based on the customer perception who
thinks products associated with well known brand names are superior in quality than lesser
known brand names.
In brand equity the customer attaches an additional value to the brand which separate it from all
the other brands competing in the market. Brand Equity implies a customer’s consciousness,
perception, trust and loyalty to the brand.
Some suggestions for extending and reinforcing a specific brand
Brand extensions are amongst the finest ways to introduce and develop the franchise of a brand
in fresh product categories. They help businesses with the techniques to get recognition value
and long acceptance among people. However, it is not so easy to move from one shop to another
as to slash the same logo on another packet.
Few well known strategies that a brand can use to become successful as a brand. These
principles will help in a proper approach as a brand extension. (Cifci, et. al., 2016)
1. Changing the Form
It is often as easy as altering the form of an current item to start a good brand development. You
can modify the shipping procedure, the conservation technique or the retail positioning of your
brand. When Starbucks launched prepared to drink beverages in 1996, which allow customers to
grab their coffee from any public place like gas station or grocery store. They found a treasure of
$705 million untouched market and soon became giant. (Sood & Keller, 2012)
2. Leverage Customer Base
It is important for business to have and maintain good relationship with their loyal customers and
it now a no secret in brand extension. You may need to focus on your key client base to expand
your brand if your brand does not have a particular element or benefit. This is solely based on the
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credibility and relationship you have established with the customers. Nickelodeon has played out
its reputation as a kid's resort in Orlando with families. (Hitesh Bhasin, 2019)
3. Leverage Celebrity value
Several brands use the name of a well-known renowned person to increase their revenues. People
admire their stars and try to become as like them by following what they do and suggest. A
celebrity can be easily portrayed as an expert of product or service, if it is managing money or
as beauty product expert. Endorsements from celebrities can help brands to gain more customers
in market as well as to enter in new category of market.
4. Using value of established products
This approach is simply based on leveraging the image of your well stablished product categories
in your brand use it to produce another category of products. The accepted products of your
brand will act as a catalyst for your new product. (Sood & Keller, 2012)
5. Selling related products
According to Chiambaretto (2016, )Products like bread and butter go hand in hand and people
usually buy them in together. Regardless of what category you are in at the moment, your brand
likely already combines something with your clients. Try to pair your parent product with other
products to create a brand extension. Just like Colgate who toothbrushes with their primary
product toothpaste.
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According to Uggla (2015), The brand portfolio of a company encompasses the collection of
brands and brand lines that comes under the hold of one company. Unlike small businesses who
operates with just one shop and works under single brand, big companies can have dozens of
separate brands in their portfolios who target different groups of people.
Often, each of these brands has its own separate trademarks and operates as an individual
business entity. However, for marketing purposes, a brand portfolio is used to group them all
together. Brand portfolios are also used to lessen consumer confusion in regard to who owns
particular brands.
It is important to implement brand portfolio strategy, to achieve long term success for a company
who have multiple brands under its umbrella. Multi-brand companies should consider all the
internal and external competitors before developing their strategy.
In marketing there are only two brand portfolio models, the House of brands and branded
property. The House of Brands model pertains a portfolio in which different brands are
established for different categories of product. This model is used by most significant consumer
goods firms. The benefit of this model is that the failure of each one of them has little effect on
the other because brands are distinct and highly related in their segment. (Denyse, 2014)
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Figure 1: House of Brands
The model of Branded House utilizes a brand in all categories of its product. The one of the
famous companies which utilize this model is Virgin who has airline, train, space companies
under their belt. This model is advantageous because positive image of one category benefits the
all the other categories.
Figure 2 Branded House
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The most prevalent type of brand design is a Branded House. Big famous brand like Virgin
follow this model in its branding, it has smaller sub-brands who operates under its name, few of
them are Virgin vacations, virgin care, Virgin holidays, virgin trains, virgin Atlantic etc.
Virgin focuses on core sectors where customers have high foot fall. These core sectors are
divided into different categories of Travel, Media, Music, Finance, Entertainment, Health &
Wellness. All these categories come under one name which is “Virgin”. (Pisano & Corsi, 2012)
Figure 3: Virgin Group Logo
The creative approach of the Virgin Company to extend its brand enables it to diversify its
service without losing customer loyalty or visibility – which is why the company has rapidly
become one of the world's most renowned companies.
Taking into account each company as specific product or service entity department, they show
departmentalization. In departmentalization they divide the departments on the basis of the
product or service. For example, the brand Virgin Records is specially designed for music
records and labels. Virgin Trains for trains and Virgin Care for Health care. Since the company
has so many departments, the whole organisation has hybrid structure. It enables the Virgin
Group to adjust well with the cultural, socia, economic and other forces in its expanding region
readily. As stated, the companies inside the Virgin Group function as individual organisations.
They consider their companies not as a hierarchy but a family. You can do your own business,
but the companies assist each other, and alternatives to issues often come from within the Group.
Hence, Virgin is group who share same values, interest and goals.
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Virgin Group Hierarchy
Figure 4: Virgin Group Hierarchy
In order to identify your product, there are numerous features and characteristics. All of the place
you assert in the marketplace, your single sales point and how clients view your business
contribute to your reputation generally. Your corporate architecture is one of the fundamental
construction blocks for brand approach. Virgin follow simple brand house architecture and every
brand of it comes under a single company. This approach of architecting the brands can also be
referred as logo-linked as the branding is coherent across all business sections. Virgin takes the
advantage of its name to promote these sub-brands and to gain customer loyalty and trust. This
enables Virgin to readily stretch its services and facilities without losing customer loyalty.
(Pisano & Corsi, 2012)
Virgin Brand Equity
When clients respond favourably to their goods, Virgin gain a differential advantage and a strong
customer base brand equity. Its market strategy and activities can attract attention in a variety of
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ways. It always aim to explore a new market allow customers to come out from the hold
of dominant industry leaders. Virgin operates in an entirely distinct product spectrum than its
rivals. They primarily target young audience market and offer value for money in exchange of
their product. In Virgin Atlantic they started bathroom services at the arrival of airport for their
business class clients. This small step has helped the company to gain brand awareness and
customer satisfaction at a negligible cost. There are five strategies for managing the brand equity
of Virgin. (Zarantonello & Schmitt, 2013)
1) Having true understanding of your business and the way of you doing it.
2) Being totally cleared about the proposition, purpose and positioning.
3) By having rich and special brand identity.
4) Be generous with your customers and provide them rich experience with your service.
5) Focusing on the people and their culture.
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