Page 266 - Marketing Management

CREATING BRAND EQUITY | CHAPTER 9 243

expected and the difficulty and expense of creating similar brands from scratch. Wall Street
believes strong brands result in better earnings and profit performance for firms, which, in
turn, create greater value for shareholders. 11

The Scope of Branding
How do you “brand” a product? Although firms provide the impetus to brand creation through
marketing programs and other activities, ultimately a brand resides in the minds of consumers. It is
a perceptual entity rooted in reality but reflecting the perceptions and idiosyncrasies of consumers.
Branding is endowing products and services with the power of a brand. It’s all about creating
differences between products. Marketers need to teach consumers “who” the product is—by
giving it a name and other brand elements to identify it—as well as what the product does and
why consumers should care. Branding creates mental structures that help consumers organize
their knowledge about products and services in a way that clarifies their decision making and, in
the process, provides value to the firm.
For branding strategies to be successful and brand value to be created, consumers must be con-
vinced there are meaningful differences among brands in the product or service category. Brand
differences often relate to attributes or benefits of the product itself. Gillette, Merck, and 3M have
led their product categories for decades, due in part to continual innovation. Other brands create
competitive advantages through nonproduct-related means. Gucci, Chanel, and Louis Vuitton have
become category leaders by understanding consumer motivations and desires and creating relevant
and appealing images around their products.
Marketers can apply branding virtually anywhere a consumer has a choice. It’s possible to brand a
physical good (Ford Flex automobile, or Lipitor cholesterol medication), a service (Singapore Airlines
or Blue Cross and Blue Shield medical insurance), a store (Nordstrom or Foot Locker), a person (ac-
tress Angelina Jolie or tennis player Roger Federer), a place (the city of Sydney or country of Spain), an
organization (U2 or American Automobile Association), or an idea (abortion rights or free trade). 12

Shaun White Action sports legend Shaun White survived three open-heart
surgeries before he was a year old, and later survived midair collisions and dramatic falls
in competition on his way to becoming a champion skateboarder and an Olympic gold
medalist in snowboarding. The two-sport legend was
signed by gear and apparel maker Burton when he was
only 7 years old. His likeability, authenticity, and shrewd business in-
sights have made him one of the most influential endorsers in the
$150 billion youth market. Burton’s White Collection of high-priced
technical winter outerwear is one of the company’s hottest sellers; HP
has used White to market its laptops and flat-panel TV’s (which also
showcase his Shaun White Snowboarding video game created by
Ubisoft); a White-designed signature goggle has become Oakley’s
biggest seller; Target’s Shaun White 4 Target collection focuses on
street wear and skateboarding for a mass market; and long-time spon-
sor Red Bull even filmed White’s snowboarding trip to Japan and re-
leased the video on MTV and as a retail DVD. 13

An action-sports hero, Shaun
Defining Brand Equity White is one of the most
Brand equity is the added value endowed on products and services. It may be reflected in the way successful product endorsers for
consumers think, feel, and act with respect to the brand, as well as in the prices, market share, and the lucrative youth market, and
profitability the brand commands. 14 a brand in his own right.
15
Marketers and researchers use various perspectives to study brand equity. Customer-based ap-
proaches view it from the perspective of the consumer—either an individual or an organization—
and recognize that the power of a brand lies in what customers have seen, read, heard, learned,
thought, and felt about the brand over time. 16