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You are here: Home / Archives for Brand equity

Brand equity

Apple tops the list of the most valuable brand with an estimated brand value of 153 Billion dollars

Last Updated on April 5, 2019 by Jan Havmoeller Leave a Comment

The value of a strong brand is indisputable and often accounts for at least 50 percent of the total market valuation

While being remembered is essential, it is becoming harder every day. A strong brand stands out in a densely crowded marketplace. Translating the brand into action has become an employee mantra.  There is substantial evidence that companies whose employees understand and embrace the  brand are more successful.  What began as corporate culture under the auspices of human resources is fast becoming branding, and the marketing department runs the show.

Click Here To See Interesting Commentary From Cristiana Pearson at Millward Brown

KNOWLEDGE IS POWER – and a Great Way to Differentiate Your Business

Last Updated on April 5, 2019 by Jan Havmoeller Leave a Comment

At Kompani Group we believe in empowerment.  Whether it is our clients or our own team, we view it the same way. We always strive to arm all of our stakeholders with the best tools and the best information.  As B2B marketing evolves at break-neck speed it becomes increasingly evident that CMO’s are buying into this philosophy.  The game is not about jazzy ads, but about delivering meaningful information to the marketplace.  Our good friends at Desantis Breindel have written a spot-on white paper on this topic.  In keeping with their philosophy that “content is the gift that keeps on giving,” we are sharing it with you.

Give them a visit at www.desantisbreindel.com and follow them on Twitter

Launching a Co-driver sub brand

Last Updated on March 20, 2019 by Jan Havmoeller Leave a Comment

The economic strains are causing your end-users to trade down, resulting in that the mid-tier and premium brands are losing share to low-price rivals.

You face a classic strategic conundrum:

  • Do you tackle the threat head-on by reducing prices, knowing that will destroy profits in the short term and brand equity in the long term?
  • Or do you hold the line, hope for better times to return, and in the meantime lose customers who might never come back?

Given how unpalatable both of those alternatives are, you now must make a decision of how to combat manufacturers and distributors of lower priced and inferior products, to avoid losing additional market share and eroding margins.

There are four ways to battle your competition.

  1. Launching a true fighter brand
  2. Launching an endorsed sub-brand
  3. Launching a co-driver sub-brand or
  4. Launching a driver sub-brand

Co-driver

Definition:

The parent brand and the sub-brand act as co-drivers with roughly equal influence on consumers.

Business Handshake
Photo by rawpixel on Unsplash

Examples:

United Express (United Airlines)

The United Airlines brand provides United Express, a commuter line, with the convenience of connections to United flights and a reputation for safety. There is no cannibalization because the flights do not compete.

United Express is differentiated from its parent brand by its lower level of on-board service, its use of smaller planes, and its less formal personality.

Good News (Gillette)

Gillette Good News also illustrates a successful co-driver relationship. Gillette Good News disposable razors are a definite cut below ‘the best a man can get” that is the Gillette legacy in shaving. But disposable razors are qualitatively different from the upscale razors such as Sensor and Atra with which Gillette has long held a technological edge.

Gillette could provide a rationale for a disposable brand by being the best in the disposable category. But the Good News user’s personality – younger and more carefree than the traditionally masculine and sophisticated Gillette persona – plays a key role in distinguishing the disposable brand from the rest of the line.

Both brand names – Gillette and Good News – influence the customer’s decision to buy the product.

Kompani Group’s Approach on Data-Driven Branding

Launching an endorsed sub-brand 2/4

Last Updated on January 28, 2019 by Jan Havmoeller Leave a Comment

This is the second of 4 posts about how to combat manufactures and distributors of inferior products that are being reverse engineered and produced in China and sold at much lower prices to your existing clients. You are losing market share fast, and it is time to do something about it.

The economic strains are causing your end-users to trade down, resulting in that the mid-tier and premium brands are losing share to low-price rivals.

You face a classic strategic conundrum:

  • Do you tackle the threat head-on by reducing prices, knowing that will destroy profits in the short term and brand equity in the long term?
  • Or do you hold the line, hope for better times to return, and in the meantime lose customers who might never come back?

Given how unpalatable both of those alternatives are, you now must make a decision of how to combat manufacturers and distributors of lower priced and inferior products, to avoid losing additional market share and eroding margins.

There are four ways to battle your competition.

  1. Launching a true fighter brand
  2. Launching an endorsed sub-brand
  3. Launching a co-driver sub-brand or
  4. Launching a driver sub-brand

Option Two – Endorsed Sub-Brand

Definition:

A sub-brand is a brand with its own name that uses the name of its parent brand in some capacity to bolster equity.

In the case of downscale offerings, the role of sub-brands is to help managers differentiate new offerings from the parent brand while using the parent’s equity to influence consumers.

The idea is both to maintain the parent’s credibility and prestige regardless of how the sub-brand performs and to protect the original brand from cannibalization.

Photo by 🇨🇭 Claudio Schwarz | @purzlbaum on Unsplash

Endorser

Definition:

The parent brand acts as the endorser of the sub-brand. In this case, the sub-brand is the more dominant of the two, and drives end-users’ decisions to purchase the product as well as their perceptions of the experience of using the product.

When a company offers an endorsed sub-brand, there are three brands at work. The parent brand itself is split into two: a product brand and an organizational brand. The product brand remains as it was, a premium brand delivering a certain image and associated benefits.

The endorser strategy provides an excellent chance to minimize damage and reduce the threat of cannibalization to the parent brand. Keep in mind that all three brands need to be managed actively.

Examples:

Sabre B to C (John Deere)

  • John Deere’s foray into value lawn tractors provides a good illustration of an endorser relationship. John Deere was well known for making a lawn tractor that sold for approximately $2,000 through full-service specialty dealers.
  • Although the manufacturer was still able to command that price in the specialty market, volume retailers such as Sears and Home Depot had begun to serve a growing portion (around 30%) of that market, selling products at half John Deere’s prices.
  • So the company introduced an endorsed sub-brand for the value retailers: a low-cost tractor, Sabre from John Deere, that featured an inexpensive design and a different color and feel that John Deere’s other products

Medalist B to B (Hobart)

  • The Hobart Company, which makes an industrial-grade mixer for use in bakeries and restaurants.
  • Managers decided to create an inexpensive mixer for us in commercial and industrial kitchens to compete with offshore entries without damaging its flagship “gold standard” Hobart mixer line.
  • In 1996 the company introduced Medalist from the Hobart Company. Medalist mixers were lighter than Hobart mixers.
  • In addition, they were made with less costly materials and construction processes; and they had a color and logo distinct from those of the flagship Hobart.
  • In this example, The Hobart Company, has become an organizational brand that endorses the sub-brand, Medalist. Medalist itself is a new product brand. Thus the parent brand, Hobart, is separated from the sub-brand, Medalist, by the organizational brand, The Hobart Company.

Kompani Group’s Approach on Data-Driven Branding

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