CONSUMER BEHAVIOUR vis-à-vis BRAND LOYALTY BIBLIOGRAPHY KOTLER AND kELLER (158,290,261) MARKETING RESEARCH(Gilbert and Dawn) (110) www.brandimage.com Wikipedia.com www.aolresearch.com B R A N D L O Y A L T Y BRANDING A brand is a name, term, design symbol or any other feature that identifies a seller’s product from a competitive product. Brand Names -Verbal part of the brand Brand Marks a symbol, design or distinctive coloring or lettering. Ex. A brand name written in a distinctive way (Logo) Benefits of Branding BUYERS Identify products via Brand Recognition Shopping efficiency is facilitated - Search time ( ) - Association of quality level ( ) - Perceived risk decrease ( ) - Facilitates repeat purchasing ( Benefits of Branding SELLERS Identify products via Brand Differentiation Selling efficiency is facilitated - New product introduction/Acceptance - Promotion of product (awareness) - Brand loyalty is assisted - Pricing at a premium - Legal protection Most Valuable Global Brands Brands Brand value Coca Cola $ 36 Billion Marlboro $ 33 Billion Nescafe $ 11 Billion Kodak $ 10 Billion Microsoft $ 9.8 Billion Budweiser $ 9.7 Billion Kellogg's $ 9.3 Billion Motorola $ 9.2 Billion Gillette $ 8.2 Billion Bacardi $ 7.1 Billion Source: Financial World What is Loyalty? The consumer is loyal to you is s/he frequently buys your product Desired Behaviour Loyal Behaviour Low High Commitment/desired behaviour The actively loyal customer High Potentially Actively Loyal Loyal is the only (long Emotional Behaviour Behaviour term) profitable bonding customer Passively Loyal Low Behaviour Low High Desired Behaviour Extend the relationship from Product to Brand High Depth of Involvement reflects moving from a narrow relationship with an individual product to Low High broad usage of the Desired Behaviour full range of products marketed under the brand Co-Branding Two companies join to create a new product carrying both their brands. Co-Branding Examples: Pizza Hut & Pepsi McCains cake and KFC Cereal box with other thing inside Pizza Pizza and Blockbuster video rental & Chocolate bar BRAND LOYALTY Brand Loyalty is the consumer's conscious or unconscious decision, expressed through intention or behavior, to repurchase a brand continually. It occurs because the consumer perceives that the brand offers the right product features, image, or level of quality at the right price. BRAND LOYALTY CRIRTERIA 1. Past Experience 2. Price Price + Quality 3. Quality =Value 4. Recommendations by others 5. Brand popularity Brand loyalty FACTS As perceived risk increases, the preference for branded products increases Tends to increase with age Higher among heavy users Decreases as inter-purchase time increases Challenges of brand loyalty How should loyalty be created and sustained ? Are there different approaches for fast moving consumer goods and durable categories? How should retail networks be used to build loyalty at the retail outlet level? How should loyalty programmes be floated so that they are profitable to companies too unlike several programmes which do not get much value for the brand? IMPORTANCE VARIETY HIGHER SALES VOLUME (COMPETITIVE U.S. MARKET) PREMIUM PRICING RETAIN RATHER THAN SEEK How to? FAVOURABLE BRAND ATTITUDES TO BE DEVELOPED DEVELOP AN UNBEATABLE PRODUCT THESE HABBITS MUST BE REINFORCED. CONSUMERS REMINDED OF THE VALUE OF THEIR PURCHASE ENCOURAGE REPEATED PURCHASING ADVERTISING BEFORE AND AFTER SALE (eg.TRAVEL) SERVICE 80:20 RULE TREAT THEM BEST LATEST TREND Mercedes Example. Having long been at the top of the heap, Mercedes has crashed in the last ten years, tumbling from first to 28th place on a list of 35 car companies in a reliability survey conducted by J.D. Power, a market research firm. Mercedes is losing the loyalty game because of the declining quality and reliability of its cars. "Even German taxi drivers no longer hail a Mercedes," reports the Financial Times, noting that the company’s reputation has been tarnished because the vehicles simply aren’t dependable any more. THANK YOU QUESTIONS???