Brand Management Report: Costa Coffee, Brand Equity Strategies

This report delves into the critical aspects of brand management within the dynamic business environment. It begins with an introduction to brand management and its significance, emphasizing its role in enhancing product value and customer loyalty. The report uses Keller's Brand Equity Model to analyze how brands are successfully managed over time. The report then transitions into a detailed case study of Costa Coffee, examining its brand portfolio strategy, including its coffee and ice blended products, and its hierarchy management of brands, such as the branded house, house of brands, and endorsed sub-brands. The report also covers strategies used for managing brand equity, like consistency in brand image, competitive analysis, brand extension, reinforcement, and revitalization. Furthermore, it explores how organizations measure and manage brand value over time. The report is structured to provide insights into effective branding practices and the application of relevant models and concepts in the real-world context of Costa Coffee and Optimum Impressions Ltd.

Brand Management

Table of Contents
INTRODUCTION...........................................................................................................................4
1.Introduction..............................................................................................................................4
2. Main Body .............................................................................................................................6
TASK 2............................................................................................................................................7
1. Costa Coffee's brand portfolio strategy...................................................................................7
2. Hierarchy management of brands within organisations portfolio...........................................8
3. Strategies used for managing the equity of the brand within Costa Coffee's portfolio...........9
TASK 3..........................................................................................................................................10
1. Strength of a brand that can be leveraged ............................................................................10
2. Weaknesses that may need attention providing some possible suggestions.........................10
3. Collaborative and partnership agreements............................................................................11
TASK 4..........................................................................................................................................11
Different types of techniques for measuring and managing brand value..................................11
REFERENCES..............................................................................................................................14

INTRODUCTION
Management of Brand is very essential for the organisations in order to compete this
complex dynamic business environment. It is a series of techniques used to increase the
perceived value of a product or a service (Arai, Ko andRoss, 2014). Effective brand management
assist the company to attract large number of customers by offering them higher quality of
products. Branding can increase loyalty of consumers towards company's offerings. The present
report is about Optimum Impressions Ltd, which is an advertising company. Report will include
article on how brands are managed successfully over time using Keller's Brand Equity Model.
Along with for the rest of the company which is considered is Costa Coffee. It is a multinational
coffee house found by Bruno Costa and Sergie Costa in 1971. It discusses brand portfolio,
extensions and leverage in context for the company. At last report will focus on how
organisations measure and manage brand value over time.
TASK 1
Article : Brand is Power
To - Board of Directors of ‘Optimum Impression Ltd’
From - Marketing manager
Date - February 16 , 2019
Subject - Brand is Power
1.Introduction
Optimum Impressions Ltd is a private limited advertising company conducting business
all over UK. Marketing director of the respective company had prepared an article which helps
company ion producing a new marketing brochure.
Brand- It is the unique product or a service offered by the company with high attractive
features, symbols or designs in order to attract customers towards its products. Brand is an
overall experience of a customer that distinguishes organisations product with those from
competitors.
Brand Equity- It is the commercial value which is derived from the consumer perception of
the brand name of a specific product or a service. In general it is the combination of brand
awareness, loyalty, associations and perceived quality among customers (BuilDe Chernatony

and Martinez, 2013).
Stages of Building a Successful Brand
Step 1- Find out Target Audience- In order to build successful brand, company has to
determine its target audience keeping in mind individual needs and desires. Managing Director
at Optimum Impressions Ltd should determine its target audience and provide them services in
order to provide them maximum satisfaction.
Step 2- Define Brand Mission- It states that company should define the mission for its brand
in order to enhance customer loyalty towards the brand. It allows customer to analyse the
reason for the existence of brand which allows company to build successful over years.
Step3- Research Competition- This stage assist the managing director to completely analyse
the overall competition in the market in order to improve their product and service. This helps
Optimum Impressions to make modifications in their product and service and helps develop
successful brand over years.
Step 4- Create Value Propositions- In this managing direction of the company should analyse
the internal and the external environment and tries to develop effective strategy which will help
in creating proper values to their brand and attracts large number of customers. Marketing
manager of the company should focus on identifying ther features which makes their brand
valuable and unique.
Step 5- Determine Brand Guidelines- In this respective company sets guidelines, rules and
regulations on the way company interacts with their target audience. Proper brand guidelines set
definite patterns for its logo, tag line and structures the brand tone (Chauhan and Pillai, 2013).
Step 6- Market the Brand- This state allows company to adopt to a effective marketing strategy
in order to increase customer awareness and promote their brand in order to maintain long term
sustainability in market.
Role of Marketing Department in creating Brand Equity
Marketing plays a very important role in creating brand equity as these marketing programs are
related to product, place, price and distribution channels. Marketing focuses on providing high
quality differentiated products and should promote their products with effective distribution
channels as way to increase brand equity for their products and service, By adopting a effective
marketing communication program, marketers have to ensure effective connection with
consumer and able to effectively communicate about brand and increase brand awareness and

image.
2. Main Body
Successful Strategy for Strengthening-
Brand Equity- In order to strengthen brand equity,innovative and qualitative products should
be offered to offer maximum satisfaction to the customers. Company should adopt effective
strategies for strengthening brand equity-
Consistency in Brand Image- Marketers of the company should focus on bringing consistency
in its brand image so that brand equity can be strengthened. Consistency in the brand should be
maintained by delivering brand message in line with the brand identity, values and strategy over
time (Da Silveira, Lages andSimões, 2013).
Competitive Analysis- This strategy focuses on identifying the competitors in market and
analysing their products. Moreover it assists the company to make modification in their
products and services and provide more innovative products to increase customer awareness
and strengthen brand equity.
Brand Extension- It is the method of developing and marketing a new product under the well
established brand name. Respective company can adopt brand extension approach in order to
market new products without promotion costs.
Brand Reinforcement- Brand reinforcement refers to maintaining of brand equity by a keeping
a good image in the minds of consumer. In order to reinforce its brands respective company
should conduct market research analysis and providing services according to customer needs.
Revitalising the brands- It is the strategic approach adopted by the respective company when
its products or services reaches the maturity stage and profits starts declining. Respective
company could revitalise its brands by renaming the product or service or by adding certain
quality features in it.
Keller Consumer based Brand Equity Model
Keller Customer Based Brand Equity Model- It is a pyramid shaped customer based brand
which helps company in strengthening brand equity and allows in effective implementation of
strategy accordingly. Respective company should use Brand equity model which is described
as follows-
Brand identity- It assists the respective company to create awareness about its product to
consumers by offering product with its unique features, designs and proper quality, it helps in

creating brand identity and differentiate it from competitors.
Brand Meaning- It is the step which communicates the meaning of brand and communicates
its meaning to customers in market place. It consists of imagery and performance of brands in
market as well as in customer's mind.
Brand Response- When the brand is made aware to the customers, i this step includes feedback
is taken by the customer regarding respective company's products and services It includes
feeling and judgement of customers regarding brand.
Brand Resonance- This step basically focuses on creating relationship among the company
and customer for achieving better objectives. Company should provide quality products to its
customers so as to maintain long term relationship (Dessart, Veloutsou andMorgan-Thomas,
2015).
CONCLUSION
Branding as a marketing tool- Branding greatly assist the company in marketing their
products or services. When the brand of the respective company full fills the needs and desires
of the individual it increases word of mouth promotion which persuades other customers to buy
the product. Branding refers to a memorable design or a logo which increases good will of the
customer and allows more customer retention. This way branding also acts as an marketing tool
for the organisation.
Evaluate how brands are managed successfully over time using application of appropriate
theories, models and concepts.
Keller Customer Based Brand Equity Model is effective for every one customers as it provide
all those necessary things which are required. This model is effective and easy to use for
customer as response which are taken from customers are positive but sometimes while taking
feedback of customer, negative review might create some unnecessary problem. So, this model
have positive as well as negative impact from companies point of view.
Appropriate and validated examples within an organisational context.
In this company, company is focusing on its brand image and trying to find how they can
expand their business activities in future. Even company haves its own meaning in brand which
makes them different from other.

TASK 2
1. Costa Coffee's brand portfolio strategy
Brand Portfolio refers to an umbrella brand in which all the brands or the brand lines of a
particular product functions to meet the needs of different market segments. Brand portfolio
strategy is adopted by the Costa Coffee in order to strengthen its brand image in coffee products.
Respective company offers different products such as Cappuccino,Latte, Flat , White Americano,
Mocha and some of the ice blended products such as Coffee cream, Mocha cream Frostino and
many more. This allows the company to promote its products as well as increase customer
awareness in order to strengthen their brand equity. Therefore, brand portfolio strategy of this
company is mainly classified into two categories – Coffee products and ice blended products
(Dinnie, 2015).
2. Hierarchy management of brands within organisations portfolio.
Hierarchy Management of brands is also known as brand architecture in which all the
brands are associated with the organisation and are different with their qualities and
characteristics with each other. Costa Coffee uses various models of brand portfolio which are as
follows-
Branded House- In this model , respective company is the brand itself. Their sub brands do not
detract from the main brand. This increases customer awareness and becomes memorable in the
minds of customer. This strategy provides maximum benefits to the company as ease in
performing business as all the competition are avoided by keeping the product offerings under
the same brand. As Costa Coffee provides many products under the same brand name it becomes
easy for the company to increase customer awareness and therefore gains high consumer loyalty
towards the product. Hence it also benefits the company to extend its product lines under the
same brand and targets more customers (Gundala and Khawaja, 2014).
House of Brands- House of brands is home to numerous brands each independent of each other
and has its own target audience. This strategy has a opportunity to meet different customers
requirements. With the help of HOB respective company can take risk as they have a strong
brand name at their back. In this model respective company can provide various products under
the well established brand name.
Management Hierarchy of Costa Coffee

Umbrella Brand- It is also known as family branding which involves marketing
practice, having the use of single brand name under the sale of two or more related products. It is
normally used by the companies with a positive brand equity. Costa coffee uses this management
hierarchy for the sale of Cappuccino, Americano Mocha costa coffee products as they both are
related to each other (Hanna and Rowley, 2013).
Endorsed sub brands- This brand subject area is made up of single and well defined
product brands. It is usually concerned with bidding a famous personality so that right approach
of promotion may lead company to raise profitability and enhance customer base of Costs Cofee
Company.
3. Strategies used for managing the equity of the brand within Costa Coffee's portfolio
It is necessary for every organisation to adopt to various strategies in order to strengthen
and manage brand equity. In this Aaker Brand Equity Model is being used by Costa Coffee
which discusses number of factors which are discussed below-
Brand Loyalty This expresses to the extent to which
customers are loyal to a brand which assists the
company in reducing marketing cost and
provides time to focus on customer needs. In
this case respective company has a strong
brand loyalty which maximises the revenue
and increases customer retention.
Brand Awareness This describes to the extent to which brand is
known to the customer and motivates them to
purchase company's products. In case of Costa
Coffee company brand has a high awareness
because of its high quality and its special
symbol has made high awareness among the
customer (Heding, Knudtzen and Bjerre,
2015).
Perceived Quality- The extent to which brand is considered to
provide quality products can be measured by

following parameters such as level of
differentiation in relation to competing
brands(Aaker Brand Equity Model. 2019).
Costa Coffee properly access customer needs
and provides products accordingly. For getting
maximum customer satisfaction respective
company has added many flavours to its
products in order to products with high quality.
Brand Associations- In this contrast it retrieves power and how
much the product is different from others in
offering high quality products. In context to
Costa Coffee it has involved in CSR activities
and set up Costa foundation in order to get
associated with coffee growing communities
around the world.
Other proprietary assets It includes proprietary assets such as trade
marks, patents and channel relationships that
give important assurance to both organisations
and consumers. Costa Coffee has made a large
investment in R&D to maximise their profits
(Hutter and et. al., 2013).
\
Critically analyse portfolio management.
Costa coffee have one of the ideal portfolio management where give detail information
about there coffee and what the main advantages of it and how company is planning to work in
upcoming days. Here, company provide various items in a single roof which decreases the
burden of customers. But sometimes this types of strategy might be negative for any organisation
because if any one of the product fails to perform at it best then it might create problem for other
similar products too.

TASK 3
1. Strength of a brand that can be leveraged
Brand extension.-It defines as the stretching of the marketing strategies by which a new
product launches in the market with more perceived value and help in maximizing profit for the
company. The company deals on many products which has the same tag line as a brand that is
Costa Coffee products. Hot chocolate, special drinks, tea, cold drinks etc.
Line Extension- It occurs when company introduces additional items in the same product
category under the same brand name with new flavour, colours and ingredients.
Basis LINE EXTENSION BRAND EXTENSION
Definition It defines as the launching of a
new item from the same
product but differ by its
colour, forms, taste and
flavour.
It defines as the marketing of a
different product with the
same brand name and creates
a new perceived value in the
market.
Example Tea for all tastes, including
English breakfast, earl grey,
peppermint, camomile and
green tea.
Hot chocolate, special drinks,
tea, cold drinks
Brand leveraging is a strategy for using power of existing brand for supporting entry of
organization in totally new product which is related to category. Respective company has very
strong position in the UK market, it deals in the various type of products under same brand.
In present context it has been analysed that Ristretto which is one of the leading branded product
of Costa Coffee in all over the world has some of its strengths which are discussed below-
Strength of Costa Coffee

 Good taste with more preference and achieve the second largest chain of coffee brand in
the world.
 Leader of the coffee brand in the UK and covers the whole market share of its brand
value in the market.
 Spread across thirty one countries and have 2,401 stores which has 2121 UK restaurants.
 Taste better and made-up as the first preference in the UK by giving them more unique
varieties of it.
2. Weaknesses that may need attention providing some possible suggestions
Their are some identified weaknesses that has been observed of Ristretto Coffee is -
 Health conscious people who doesn't consumers because of the high range of caffeine
which will greatly impact their health.
 Prices of the products are high comparative to customers expectations which affects the
profitability of the company.
 Respective brand doesn't target younger generations al over the UK which also has a
negative impact on company.
 Lack of customer awareness about the product decreases profitability of the company.
Suggestions to overcome weaknesses
 Respective brand should provide Diet Coffee or coffee with a minimum range of caffeine
so as to target health conscious people.
 Customer's are increasingly demanding coffee with green beans, company should
produce the same in order to maximise satisfaction to its customers.
 With the help of proper advertisement channels company should promote company's
products and increase customer awareness (Hwang and Kandampully, 2012).
3. Collaborative and partnership agreements
Collaboration is the agreement between two or more brands in which parties agrees to
share data, ideas and knowledge in order to improve their profits. Collaborative and Partnership
agreements of Costa Coffee are as follows-
Vodafone and Costa to collaborate with a loyalty program. Both the companies has collaborated
to develop an app where customer can discover people in their local area who have similar
interest and are willing to exchange knowledge. Costa offering Vodafone customers the ability to
redeem their earned talk time and have a real conversion face to face in their cafes with a free

coffee for them and for their friend. Costa Coffee in collaborating with Kraft Brew UK
partnership and have developed Tassimo machines and Costa cappuccino are now going to be
available in Costs stores. Costa when collaborating with Buzz Feed on UK and European has
allow employees to engage on Facebook pages and therefore assist in attraction and retention of
customers.
Critically evaluate the use of different techniques used to leverage and extend brands.
As Costa coffee is one of the largest chain in the world where it has the physical presence
in around 31 countries. This company can expand their business only if they continue to show
their brand image with good taste. These are the things which makes company different from
other but they must keep in mind regarding their business policies as single mistake can change
the structure of business in future. So, Costa coffee must perform according to their strength to
obtain better result.
TASK 4
Different types of techniques for measuring and managing brand value
Brand Value- It is the technique used by the company in order to recognise and measure value of
brand in market. It is the marketing strategy in which investing into new brand and managing the
reputation of brand goes simultaneously. It is the financial worth which is directly linked with
the product that the company is offering. In order to increase brand value respective company
can offer quality products at reasonable price. Company has adopted various techniques for
measuring and managing brand value (Jugenheimer, Sheehan and Kelley, 2015).
Cost based Brand Valuation- It is ascertained by adding all the individual cost which is
included in creation of brands adding all the assets and liabilities. Respective company can use
this technique to measure value of brand by estimating its actual cost.
Brand Awareness- It is the process of creating awareness in the customers mind with the help of
various promotion tools. This assist the respective company to create a good image of products
in the minds of customer. Brand awareness includes brand recognisation and recall. If the
respective brand is highly aware among customers it assist them to make repeated purchase.
Tactics for measuring brand awareness

Surveys- Respective company can take feedback from its employees regarding the
product awareness and the benefits they get out of it. This assists the company to measure their
brand awareness.
Website Traffic- By analysing website traffic on organisations website and also with the
help of google analytics tracks and URL and book marks it assists the company to gather
important insights (Kapferer, 2012).
Market share- It is defined as the percentage of the total sales in market earned by respective
company within a definite time period. Market share can be calculated by dividing total market
share by total sales. Costa has a leading market share of 39% in UK as it is the largest coffee
chain in United Kingdom. Along with Costa is leading Starbucks by 25% of market share. In
order to enhance its market share e-commerce websites has played a major role (Rauschnabel
and et. al., 2016).
Consumer Attitudes- It is the combination of customer's feelings, beliefs and behavioural
attitudes towards the product of the company. Variety of customers have different attitudes
towards the product or service. Company should provide products according to customer needs
and wants. Their are different methods to measure consumer attitudes such as Structured and non
structured measurement techniques-
Structured Methods- This involves the formal structure or procedure of questioning the
customer regarding the company;s offerings as to know their attitudes towards the product.
Unstructured Methods- In this method it consist of in-depth interviews and focus
groups which is informal in nature and measures consumer attitude through pictorial techniques.
Purchasing Intent- It is the probability or the chances in which consumers will purchase products
or service is called as purchasing intent. Their are varied reasons which influences customers to
buy product. Techniques used by respective company in measuring and managing purchasing
intent-
Predictive Modelling Technique- With the help of various statistical models it enables the
company to predict the forecast outcomes as well as provides idea to the company to analyse
purchasing intention of consumers.\
Critically evaluate application of techniques for measuring and managing brand value in
relation to developing a strong and enduring brand.

In recent time company is performing really well to expand their business. To justify the
image of Costa coffee they are doing different survey just to know what their customers what
from them and what are the additional needs. Market share and consumers attitude is also
helping them to measure the accurate data. Also, the positive attitude of consumers is helping
them to perform well in future increase the profit ratio in future.
CONCLUSION
From the above report it has been analysed that brand Management plays a crucial role in
strengthening brand equity for the organisation. With the help of CBBE model it assist the
company to strengthen and increase their brand equity. Company should identify the leverage-
able strengths of the brand and identify the weakness so as to improve the weaker areas and
allows organisation to maximise their profits. It also discusses various techniques and tactics for
measuring and managing brand value so as to increase their profit and capture larger market
share.
Brand leveraging is a strategy for using power of existing brand for supporting entry of
organization in totally new product which is related to category. L'Oreal has very strong position
in the UK market, it deals in the various type of cosmetics

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Online
Aaker Brand Equity Model. 2019. [Online]. Available
through.<https://www.marketing91.com/aaker-brand-equity-model/>.

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