Will you pay more for “brand”? (Group 18)

Ferrari and Lamborghini are famous in the world, but how many of you know about that Ferrari is one of the brands built by Fiat Chrysler Automobiles and Lamborghini is belong to Volkswagen Group. Some people may say that Ferrari from which company is no important, but we must know that products and services from the same company will have the same core value and quality.

Brand is able to let consumer to identify the company ownership or be a status symbols of product. Take Toyota Motor Corporation as an example, Toyota Motor Corporation is a famous Japanese automobile company.
It is a successful vehicle manufacturer in the world that supplies more than 170 countries. Toyota had established since 1937 and there are few brands under Toyota, such as Scion, Lexus, Daihatsu and Hino.

Lexus is a luxury car brand built by Toyota to compete in the American market. Lexus is set up by the research of American luxury- product consumer habit and lifestyles. From article that shared by CBS Money Watch about Toyota and Lexus, it shows that the brand of Lexus had resulted the Toyota brand decrease for 15% over the few months, while Lexus brand is increase for 5 %. It shows that brand able to change the view and decision making of customers.

Scion is a company younger than Lexus in the American market. It is a new brand to target the young generation. Scion is mean “descendant of” from an old French word of Germanic origin. Scion with the young generation meaning to attracted more consumer. Besides that, Scion had design the vehicle with crazy paint job and bold designs that more close to young generation’s thinking. Then, Scion had also roll out a limit amount of limited edition vehicle with limited accessories. The limited accessories include subwoofers, decals, canvas roofs and even a supercharger on some models.

Toyota used different names to sell in the different countries. A brand name is importance to a company to be globalization, so the name of the brand is better to convey brand information. In different countries, the same word will have different meaning, so the company needs to have marketing research in targeted country. Other than brand name, the logo, colour and font is important to a new brand, Brand have it own personality, it able to provide consumers holistic perception and specific information. For example, Nike is famous with “tick” logo.

Toyota using the advantages of Global brands to create new brands, because different brands different price. Although Toyota and Lexus are two different brands, but they still in a same company and their vehicle may have the same engine, same body type and similar exterior and interior design. If want to compare their different, it maybe some different in gadget or accessory, such as grill, light and ignition key. For example, 2014 Toyota highlander vs. 2014 Lexus RX and 2014 Toyota Avalon vs. 2014 Lexus ES.

Other automotive companies also built their own luxury brand vehicle too. For Instance, Cadillac General Motors got Cadillac, Ford Motor Company got Mercury, Nissan got Infiniti, and Honda got Acura. So, is it worth for us to spent more money to pick a brand?

To compare Toyota and Lexus by using brand association network, maybe we may have the brand association connections that Lexus is luxury car, performance, engine is quiet compare to Toyota, better design, name of Lexus sound better and Toyota is Japanese company, quality, value, fuel economy.

From brand association network, we able to find out the power of brand is strong. If compare between Toyota and Lexus, it may have many similar point. So, let us compare the famous brands Ferrari and Lamborghini!

(Just have to list down the first perception when you see the logo.)

Reference:

Adam Fisher, 2010, Toyota and Lexus: A Tale of Twin Brands, CBS Interactive Inc., retrieved 31 Aug 2015, <http://www.cbsnews.com/news/toyota-and-lexus-a-tale-of-twin-brands/&gt;

Consumerreports.org, 2014, 2014 Car-Brand Perception Survey, Consumer Reports, retrieved 31 Aug 2015, <http://www.consumerreports.org/cro/2014/02/2014-car-brand-perception-survey/index.htm&gt;

Lone Wolffe, 2013, Japanese Car Shopping- Toyota, Lexus, and Scion, auto-era.net, retrieved 31 Aug 2015, <http://auto-era.net/buying-a-car/japanese-car-shopping-toyota-lexus-and-scion/&gt;

BRANDS & BRANDING; GROUP 15

How does a brand keep its leadership? How does it safeguard its ‘wiiings’?

-By Monah Yeleti & Hythiem Sayed

When certain brands first appear in the market, they might be lucky and establish a personality. But what does that luck depend on?

Let us take Red bull as an example, it was first established 1987 as a premium energy drink and dominated the energy drink market, then crept in the competitors like Power Horse, Monster and Burn. So what makes Red Bull so special, that it still dominates the energy drink market in spite of the vicious competition?

“We are dedicated to upholding Red Bull standards, while maintaining the leadership position in the energy drinks category when delivering superior customer service in a  highly efficient and profitable manner. We create a culture where employees share best practices dedicating to coaching and developing our organization as an employee of choice. “

                                                    ~Mission Statement of Red Bull~

As we can clearly see Red Bull goals and objectives in their mission statement. Also, it is clearly states that it strives to achieve leadership and increase the market share relative to the competitors.

However, After penetrating into a strong growth phase, brands begin to lose some of their glory, as some consumers migrate to new competitive offerings (price, performance, quality, etc.) or new interests (attractiveness, better relatability, etc.). In such times what could a brand do to retain its customers and its image?

Red Bull is constantly innovating and injecting new meaning into the brand, so as to maintain their competitive advantage.

  

Red Bull has managed to conjure a grand image, expectations and promises of performance. It has established a strong brand through the five dimensions; its features and style (Sleek and recyclable can, use of primary colours for its easy to recollect bull logo, a catchy tagline “Red bull gives you wiiings”); its key benefits and uses ( vitalises body and mind, increases concentration); an established customer perceived brand personality (Young, enthusiastic, adventuress and masculine); the company’s value ( performance and entertainment oriented, innovative, passion); and lastly the target consumer profile (students, gym goers, athletes, professionals, travellers). Furthermore, one considers the many associations that comes to mind when we mention Red Bull; like associating its brand with an amazingly wide range of people, teams and events, As it believes in owning teams and events rather than being sponsors. Also, when it comes to socializing and nightlife, Red bull is one of the leading energy drinks, as a  mixer, it associated with Smirnoff, giving birth to the famous “Vodka Red bull” which is popular among its consumers.

Promotions and marketing plays a key role in maintaining brand leadership. Many brands are only supported with reminder communication and stale ads, which is largely a waste of money until you have continuous new points or product benefits to reveal of the brand. Red Bull, never did much of traditional marketing, even if they did, it was quirky and out of the box, with higher chances of customer retention prospect.

Apart from that, it follows a more modern communication made for young people by holding massive events frequented by young people. This allows them to accumulate latest trends and fashion to improve their marketing strategies. Another famous promotional strategy that red bull is known for, are the famous wing team members (WTM) of Red Bull, along with the Mini Cooper that is customized with the colors of the brand, young female students are seen distributing free cans in some frequented places: universities, concerts, sporting events, subway exit, etc. (I did work with Red Bull for 2 years as a WTM and therefore have firsthand Personal experience of the Red Bull culture).

A person’s attitude towards a brand may range from dislike to indifference to slight preference to strong preference to devotion. Everyone has preferred brands, but few brands have devoted fans, which red bull has managed to triumph in.

So we did a little sample survey in Deakin University and the following is the result. as observed, the repeated words are energy drink and wings, therefore a majority of the consumers related it to an energy drink and its famous punch line, it primary product benefit and punch line, which is the salience of the brand. It also shows massive brand awareness among consumers.

In terms of the customer Base Brand Equity, as mentioned below, Red Bull ensures that its consumers have the best experience, be it the extreme sports events that occur around the world or the primary product itself. Red Bull has touched hearts of many customers and changed their perspective towards the brand. Additionally, it has successfully converted some customers from having brand salience to brand Resonance, by achieving the high performance, premium brand image, positive judgments and feelings. The below figure shows Red Bull’s Customer Based Brand Equity.

In essence, Red Bull has accomplished several marketing strategies to achieve its goal and to have a sustainable competitive advantage and in being the leaders of the energy drink market. What differentiates Red Bull from others is also the varied, unique events and activities that the Brand brings to the masses.

so what do you think are the dos and don’ts that would help a Brand retain and maintain their leadership position?

References:

Hassan, J. (2013). Red bull final. [online] Slideshare.net. Available at: http://www.slideshare.net/tariqkanhar/red-bull-final [Accessed 29 Aug. 2015].

Kotler, P. (2008). FAQs Marketing Managment. Singapore: Cyan Books, pp.65-72.

The power of brand image – What do they want exactly !

Group 69 – PAWEE RUANGSIT and PIT PHUNGLOM

THE POWER OF BRAND IMAGE

What do you think about those people who hold a can of Red Bull in their hands and walk around the streets? Do they really want to drink it because they are exhausted from exercise or perhaps they simply want to express their personality? Generally speaking, we only consume energy drinks to boost our stamina or to simply keep us awake. However, the strong image of Red Bull’s energy drink also reveals about our characters’

Red bull’s energy drink was inspired from an energy drink from Thailand, and its original name called Krating Daeng with two charging bull’s logo on a glass bottle. A Two charging bull’s logo means boosting up your stamina, strength and the beverage is intended to make you become strong like a fighting bull.

http://topicstock.pantip.com/food/topicstock/2009/07/D8113647/D8113647.html

In the past, Red Bull’s energy drink was focusing only on those consumer that used a lot of physical work to do their job like; Farmer, construction worker, truck driver, fisher man etc. In 1987, Krating Daeng’s energy Drink Company has partnered with an Austrian entrepreneur to co-produce its drink formula.

Originally, Red Bull’s Company aimed to establish itself as an energy drink for sporty and outdoor active consumers. Red bull representatives are mostly extreme sport figures, outdoor sport celebrities with its main source of  sponsorship being many international sporting events.  The Company has been focusing on these sporting events and activities in order to establish itself as an energy drink for sporty consumers.

For those consumers who watch or participate in extreme outdoor sporting events it is easy to recognize a remarkable Red Bull’s company logo, because its brand logo appears in almost every international extreme sporting event.  Red Bull’s company has been doing intensive and active marketing strategies over the past years. This is perhaps one of the reason why consumers associate the two charging bull logo with Red Bull and  instantly recognize it.

Red bull’s company has attached itself with exciting and energetic activities for such a long time. It has become a symbol of exciting and energetic activities itself. These might be the reasons why Red Bull Company has such a huge impact on consumer minds when it comes to energy drink product.

Red Bull’s energy drink is simply a beverage that is highly caffeinated (Inquisitr, 2015) it doesn’t even in the top 8 of high caffeine contain drinks that available in the market (The daily 8, 2015). What is it about Red Bull’s energy drink that persuades people to drink it!  Perhaps, because of Red Bull’s slogan “Red Bull gives you wings”?  I am not sure that only the slogan could have such a huge impact on consumer’s mind, but because it has attached itself with exciting and energetic activities in extreme sports for such a long time till the brand logo of Red Bull’s company itself become the symbol of excitement!

My questions to you are these; does the brand image have a significant impact in consumers mind? For Red Bull’s energy drink, is it even possible that consumers buy the product just to reveal their personality and not necessary that they would like to drink it!

References

Inquisitr, 2008, ‘The phase’ ,Red Bull Settlement: Beverage doesn’t give you wings after all, retrieved 23 August 2015,<http://www.inquisitr.com/1522385/red-bull-settlement-gives-you-wings/>.

The daily eight, 2015, ‘Redline Energy drinks’ ,Top 8 Most Powerful Energy Drinks, retrieved 25 August 2015,<http://thedailyeight.com/health/top-8-most-powerful-energy-drinks/>.

Logodesignlove, 2015, ‘The following is excerpted’ ,The origins of Red Bull, retrieved 25 August 2015,<http://www.logodesignlove.com/red-bull-origins>.

Krating Deang bottle 2013 retrieved 30 Auguest 2015, <http://topicstock.pantip.com/food/topicstock/2009/07/D8113647/D8113647.html&gt;

Co- Branding: Be careful who you get into bed with… (Group 17)

In the world of Marketing there isn’t anything much more important to a company than the intrinsic profile and reputation of its brand. Legal departments spend just as many millions protecting the outward image as their colleagues in marketing spend promoting it.

For this reason the strategy of co-branding, which is taking on exciting new dimensions across a number of industries, is an interesting development within the realm of brand promotion and the launching of new products.

Co-branding refers to a marketing arrangement where two different brands join forces to create a product or service indicative of both their identities.  This approach opens up an opportunity for one brand to introduce their product or service to the devotees of another brand.

With the added benefits of sharing some marketing costs, improved market acceptance, synergies in sales ie: linked web traffic, shared real estate space and cross promotional deals the whole idea must be very attractive to Marketing execs all over the world. 

A very recent example of co-branding which occurred close to home was the ‘Project Botanicals’ pop up restaurant experience which ran for three weeks in Melbourne during July. This event saw the Bombay Sapphire Gin brand joining forces with Gary Mehigan of Masterchef fame to put on the exclusive ticketed event. Guests were treated to a number of dishes designed by the celebrity chef and cooked by his team whilst matching Bombay sapphire cocktails accompanied each course. The guys behind Bombay Sapphire also used the event to promote the launch of their new super premium offering, the Star of Bombay. This product is targeted towards connoisseurs, as it is a much more refined, not to mention stronger, spirit. By capturing a market of ‘foodies’ using the Masterchef connection, Bombay Sapphire was able to create a targeted campaign albeit it on a fairly small scale.

Bombay Sapphire has a history of co-branding and collaboration since its very inception. In fact the brand itself is a testament to what can be done with great marketing. The Iconic blue bottle and the brands creator Michel Roux’s pursuit of a long lasting connection with the design world literally revived reputation of the whole gin category globally.

It was no longer the stuff your grandmother drank, gin was cool again.

In the aforementioned example, the project botanicals pop up created a massive post event spike in the sales of Bombay across Victoria. The event was such a success the concept is now being transplanted to Sydney in the coming months.

 There is of course many such examples of this strategy being utilized. Take Nike and Apple for example, very separate businesses selling separate products in a very similar market segment, but with an amazingly profitable synergy – apparently runners like to listen to music when they run. Who would have guessed that little connection would turn out to be so profitable….

The Nike / Apple team-up is a really great example of the importance of “fit” when choosing to Co-Brand. Both are very strong companies with reputations based on a quality product, products that obviously do well in the consumers mind when offered as a going concern.

And how about this for one out of the box. Carmaker Toyota is now including a mount for a GoPro action camera in their new 2016 line up of their more adventurous vehicle models. Similar thinking to Nike and Apple, similar segment of the market and attempting to Co-Brand to capture the essence of the experience this partnership can create ie extreme sports / offroad 4WDing etc. Only time will tell whether they hit the mark with this one, but I am sure the videos on Youtube will enlighten us as to how effective they have been in appealing to the segment.

 

These are examples where two companies are plying their products in the same segments and hoping the synergies will help them rattle a little bit more gold out of the consumer’s purse.

What about one of the more interesting Australian attempts at co-branding last year, with the release by Cadburys of Vegemite chocolate? Whilst financial results aren’t in, and the product is certainly no longer a regular offering on the shelves, could you honestly say this was a co-branding failure? Think about it, even American Late Night host Jimmy Fallon felt the need to comment, and I am sure many purchased it and had a go “just to see what it tastes like”. Is it possible in this case that whilst the product could be a failure, the brand exposure could be hailed a success for the companies existing products and brand??

Of course brands need to be very careful to ensure they are clear on the fit and the segment they are marketing too, but even more so, who they go to bed with in a co-branding or co marketing exercises.

For example, negative press around one partnership can have a devastating effect on the other brand through their association.

 

Remember this guy?

The nine year partnership between Nike and the Lance Armstrong ‘LiveStrong’ foundation revolutionized the way charities raise money and also sold a lot of Nike shoes and apparel along the way. After Armstrongs confession to doping aired on the Oprah Winfrey show Nike was very quick to cut ties with any link their brand had to the disgraced cyclist.

Whilst the result is evident that the longevity and reputation of the co-brand wasn’t great, the company and the foundation survived and moved on. Lance’s standing in the global community unfortunately didn’t quite make it…

So in closing, we have a number of questions to pose to the groups out there…

What are the factors in a co-branding exercise that are likely to make it more successful and are there any obvious pit falls that should be avoided?

Is the future of co-branding taking a new dimension as in the Bombay case, where the product created isn’t one of commercial substance, but of brand attraction and retention?

Can negative press of one side of the partnership greatly affect the other?

Is the saying “there is no such thing as bad publicity” true?

How much control does each side need over the message being released?

Can you extend your reach in the marketplace without upsetting your existing segments?

Appreciate your feedback! 🙂

References

https://www.marketingsherpa.com/article/case-study/bombay-sapphire-tests-online-brand

http://www.knowthis.com/1933-the-high-rate-of-new-product-failure-leads-to-more-co-branded-consumer-products

http://www.impactbnd.com/co-marketing-vs-co-branding-whats-the-difference

http://www.marketingmagazine.co.uk/article/1165917/champions-design-bombay-sapphire

How important is brand association and personality to you? Become an Expatriate and you’ll find your answer (Group 56)

Nearly two years ago to date, I was lost in a Carrefour Hypermarket in Dubai whilst trying to find staple household items such as bread, milk and eggs. The absence of familiar brands that made my product purchase decision making cycles infinitely easier made me quickly realise that I was far from home.

Apparently I was not alone in feeling a little homesick after not being able to connect with familiar brands in a foreign country.

In her article titled ‘Using brands to overcome culture shock’ (2012), Dr. Eliane Karsaklian finds that “the negative attitudes and feelings of an inescapable loss of country differences created by the vision of same brands and same advertising everywhere in tourists and other ephemeral travellers, are positive to expatriates who look for stability and familiarity when freshly arrived in the host country.” (Karsaklian, 2012)

Dr. Karsaklian further elaborates, stating that “global brands are precious helpers, by providing practical and emotional safety by reconstituting memories of situations from the homeland”, and that “living abroad, expatriates seem likely to stick to their values by buying brands that convey those same values.”

In a study conducted on expatriate shopping behaviour in the Netherlands, expats were asked about products from their home country that were unavailable in regular Dutch stores. The majority indicated that there are indeed specific products that they miss: mainly foods, clothing, books and media, and personal care products.” (G.J. Wijnen, 2012)

Expatriate consumer behaviour highlights the significance of brand association and personality development in any marketing strategy, be it global or localised.

Brand association is described as the intangible cognitive and emotional associations that the company helps the customer connect to its brand, whereas brand personalities capture information specific to the brand, as well as holistic perceptions about the brand and company position in the marketplace (Iacobucci, 2013, pp79).

Brand association and personality could also be described in terms of a relationship between the consumer and a brand. Keller (2012) uses the term ‘brand resonance’ to characterise the nature of consumer-brand relationships. Brand resonance is “the extent to which a person feels that he or she resonates or connects with a brand and feels ‘in sync’ with it.” It is measured in terms of intensity (depth of psychological bond) and activity (frequency of purchases and use).

An example of a company that every expatriate has taken refuge in (due to their firm understanding of the importance of brand association and personality) is McDonalds. One of the aims of McDonalds is to create a standardised set of products that taste the same, regardless of what country you find yourself in (C. Vignali, 2001). The company ensures consistent quality across its vast network, through the establishment of tight supplier specifications, as well as global quality assurance teams and a regimented staff training program (C. Vignali, 2001).

“When I arrived in the airport, I felt as the only fish in the ocean, because I didn’t know anyone. Then, there was an ad for Heineken beer and I went to a bar to drink it with some Lay’s chips while seeing ads for cars and watches at the bar’s TV, and was wondering in which McDonald’s I would have dinner that evening.” (Karsaklian, 2012, pp 11)

In summary, the common expatriate experience of looking for stability and familiarity in brands when freshly arrived in the host country shows us the true potential and importance of brand associations and personalities. Every company should aim to market its produce so that the effect of removing it from consumers would have a real and deeply felt impact.

Do you have your own expatriate experience relating to the importance of brand association and personality? We’d love to hear about them.

References

D. Iacobucci, Marketing Management (MM), South Western, Cengage Learning, 4^th Edition, 2014, Ch 6 – 8

K.L. Keller, Understanding the richness of brand relationships: Research dialogue on brands as international agents, Journal of Consumer Psychology 22, 2012, pp 186 – 190

E. Karsaklian, Using brands to overcome culture shock, Australian and New Zealand Academy of Marketing Management (ANZAM), 2012, accessed through http://www.anzam.org/wp-content/uploads/pdf-manager/222_ANZAM-2012-041.PDF

C. Vignali, McDonalds: “think global, act local” – the right marketing mix, British Food Journal, 2001, Vol 103, pp 97 – 111.

Why new product –Tesla success in automotive market? (Group 85)

                                                                                                                                                                 Group 85

 Yihui Yang 214448823

Jiajun Ma 210025743

Innovation / Technology

Tesla is a famous electric car brand in US. It emerged in the automobile market in the recent years and you may have seen the massive advertisements about it from the media. Tesla has received enormous attention from the public, and the share price of this brand has risen about 600% since 2013.

The main reason why people have so much interest in Tesla is not only because the value of its stock, but also they make great cars.

Tesla Model S has become a technology marvel because it presents the world’s first premium electric sedan in 2012.

In 2013 Car of the year competition, it received a 5-star safety rating, which was their best result ever.

Today, the Model S 85D can travel around 270 miles (432km) and it can accelerate to 60 mph (97km/h) in only 3.2 seconds.

Another high-performance car type, Tesla Roadster, has a max range of 300 miles.  This is a huge step in making electric vehicles in practical. Normally 265 miles is the range of a typical gasoline car before refilling and by reaching that level, Tesla has made a big achievement.

Tesla says the 60-kwh battery provides a range of up to 232 miles and the 85-kwh battery provides up to 300 miles . Here are some examples for recharging times: With a single onboard charger plugged into a standard 110-volt outlet, Tesla says you will get 5 miles of range for every hour of charging. From zero to 300 miles would take about 52 hours at that rate. With a single charger connected to a 240-volt outlet, which Tesla recommends, the pace speeds up to 31 miles of range for each hour of charging, and a full 300-mile charge takes less than 9.5 hours

In the future, the factory of Tesla expect to supply 500,000 Tesla cars per year and Tesla will decrease the manufacturing cost so that it can have a competitive advantage in price and attract more customers.

Macro environment

Tesla’s electric sedan is a new successful type of car, which is affected by the changing of macro environment. The mainstream culture starts to change, with an increase in environmental consciousness, attitudes and emphasis on green products. The demand of Tesla is affected by these changes, and also how the company operates. Tesla cars produce zero emissions, which can meet the requirements of the changing environment.

Meanwhile, an important reason why Model S is so popular is because its acceleration is faster than most sedan cars, which have the same prices, and yet produces no carbon emission. Besides, Tesla’s zero emission Model S and the expensive price gives the affluent buyer an opportunity to this exclusiveness.

From the aspect of natural resource, traditional products of automobile industry have an over-reliance on oil resources. There is no doubt that the oil demand is influenced by the dramatic decrease of oil production and the US government is pushing stricter legislation within the industry because of environment pollution. As a consequence, the cost of petroleum products will rise. The above natural factors will influence the future prospects of Tesla Motors. The future trends will promote new technologies and influence energy policies with the environment in mind and re-thinking mobility.

Market position

Tesla are different to other luxury car brands, many of luxury brands sales promotion based on the quality of their engine, and engine performance is one thing that makes them special and desirable. Tesla focuses on replace the engine power by technology from petrol to electronic. This strategy lead them into an Electronic Vehicle Market.

Lack of competition

Tesla is the only company selling production volumes of a high-end, high-range electric vehicle.   The reason behind this is that, all most all automotive company get their revenue from fuel cars. If they started releasing production of high-end. High-range electric cars, it would be a threat to their fuel cars and affect their market position.

Moreover, there is some Electronic Vehicle in the market, such as i8, i3,BMW 5 series, XC90, Smart fortwo,. But they are not competitor for Tesla, because EVs could classify into hybrid vehicles short range electric vehicles and long-range electric vehilces, these cars are very different in how they use electric batteries, compare those cars to Tesla would give a false result to automotive market.

Sales promotion

Tesla is different to other automotive company, not only from design, also from the sales, it sales does not involved any dealers, which means no 4s 3s store, the way of evaluate information of the car is online website, the website provide you the kiosk stores in malls with Tesla staff, if people want to buy, they place a refundable deposit online. Tesla online website provide all the needs for buyer and customers, u could make appointment for test drive, apply car problem, even battery recharge place. The website replace the traditional 4s store, Tesla is selling cars the same way Apple selling their products.

Question:

Could you provide other factors that why Tesla is so popular?

Any question you would like know about Tesla?

Electronic car is a new product for automotive market, would you think one day in the future that electronic car going to replace fuel cars? Why or Why not?

Reference

Paul J. D’Arcy, 2015, ‘Tesla Model S: The Disruptive Marketing of an Electric Car’, Journal of Science of Revenue, vol. 22, No. 1

Abugail Phillios. 2014. 7 reasons why Tesla has succeeded where others have failed. [ONLINE] Available at: http://www.manufacturingglobal.com/leadership/186/7-reasons-why-Tesla-has-succeeded-where-others-have-failed. [Accessed 28 August 15]

Rick Popely . 2013. How Quickly Does the Tesla Model S’ Battery Charge?. [ONLINE] Available at: https://www.cars.com/articles/2013/11/how-quickly-does-the-tesla-model-s-battery-charge/. [Accessed 28 August 15]

How Do Global Brands Create Value

Why do some customers prefer to buy a global brand to local brands? A study into perceived brand globalness suggests three pathways that influence likelihood of brand purchase (Steenkamp 2003)

Global brands can suggest better quality, can give an impression of prestige and can connect consumers through the idea of global consumer culture which instill a sense of belonging. In some cases consumers look at global brands as symbols of cultural ideals.

‘Global brands make you feel part of something bigger…’

For brands to be considered global, at least 30% of their revenue must come from other countries. Going global is not as simple as just expanding to another country geographically but entails rethinking strategies and redefining how value is created.

Guinness is a classic example of a brand that has revised its strategy to cross cultural markets. In Australia the brand uses its Irish heritage with over 200 years of brewing tradition, while in the Caribbean its translation of inner strength is more focused on reinforcing masculinity.

Three further examples of successful brands that went global are Red Bull, Duncan Donuts and Havaiana.

Red Bull, an Austrian company, went global through a great marketing strategy by hosting extreme sports events all over the world. Red Bull Indianapolis Grand Prix, Red Bull Air Race (UK), Red Bull Soap Box Race in Jordan.

Duncan Donuts went global and with over 3,000 stores in over 30 countries they diversified their menu option to suit the tastes of their global customers, offering Grapefruit Coolatta’s in Korea and Choco Nut donuts in Thailand

Havaianas went global repositioning from a cheap flip flop with functional value into a fashion brand offering social value through determination, resilience and consistency.

Do you think global brands gain a competitive advantage and increase the likelihood of purchase? What implications arise from becoming a global brand? While there are perceptions of higher quality and a ‘global culture’, are there higher expectations for social responsibility?

References

Steenkamp, J, Batra, R, Alden, D 2003, ‘How Perceived Globalness Creates Brand Value’, Journal of International Business  Studies, vol. 34, No. 1

Iacobucci, D (2014) Marketing Management (MM),4^th Edition, South-Western Cengage Learning, Mason

https://hbr.org/2004/09/how-global-brands-compete

Group 155 – Under Armour (Blog 2)

Thanks to everyone who’s shared their views on our blog, gives us more topics to think about along with a whole lot of different perspectives. Some points of view mention that the entire targeting strategy implemented was maybe just an accident. Well, even if this was the case, UA has done a fabulous job in expanding their product line and range. From starting off with their “DryFit” performance enhancing gear, today UA has expanded to getting into a variety of sports. Going a step ahead, they now even have a product rage for niche markets like military and tactical, hunting and tough mudder. UA since the very beginning, has followed a very unconventional promotional strategy. Did anyone notice the apparel used by Dwayne Johnson, more popularly known as “The Rock” in all the Fast and Furious movies?

If you have a closer look you would notice that he exclusively wears only UA apparel. Digging further into this, we found that there is no contractual agreement between him and the brand.

Dwayne Johnson made his WWF debut in the year 1996, where he was quick to become the crowd’s favorite. Making his way into movies from 2001, Dwayne has established himself as an action hero with movies like Hercules (2014) and San Andreas (2015) riding on his “sizable” shoulders. Former football player, actor, wrestler, health and fitness freak – That’s an impressive profile to choose to endorse your brand, that too in a very subtle manner. Think of the various, very specific market segments that are influenced seeing that logo on his t-shirt.

Another big step that the brand took was to venture into the world’s most watched league (Barclays premier league) partnering with Tottenham Hotspur (12^th most supported team worldwide). This was UA’s largest individual team deal. With 11 million Tottenham supporters and 4 other premier league teams in London, Under Armour made a hefty presence in the United Kingdom that resonated world over.

Speaking of increasing their target market, we leave you with their “Protect this house” campaign, which more importantly, also targets the women.

Look forward to getting some interesting thoughts!

On Goods and Services (Group 18)

Goods VS Services

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The good or services the organization provides society. products that are sold, traded or otherwise provided to consumers or other companies can be classified as either goods, which are tangible, or services, which are intangible.Also, most countries measure their economies on the production and consumption of both physical goods and intangible services. Some companies provide both goods and services, and others provide only one or the other.

What is Goods?

Goods mean that  items that can be seen and touched, such as books, pens, salt, shoes, hats, and folders.Also,other goods are more long-term in nature and might last for many years or even decades. Furniture, dishware and houses are examples of durable goods that are intended to be used for extended periods of time.

What is Services?

Services are intangible products – those that cannot be seen or touched such as that are provided to consumers or other companies. A physician provides healthcare to patients. Communications companies provide services such as Internet access, television programming and the ability to make local or long-distance telephone calls. Other companies provide services such as lawn care, plumbing, home repair, business consulting or transportation.

On the qualities,First,Experience qualities definition aspects of a service such as courtesy, attention, satisfaction that can be evaluated only after purchase and consumption. Secondly,Credence qualities definition aspects of services that cannot be evaluated by a consumer even after ‘consumption’ but have perceived value. For example, legal or medical advice. Finally,search qualities definition aspects of may be evaluated prior to purchase. For example, consumer know the competitive offerings e.g. clothes how they look, feel, the price and how they feel to other clothes.

In my blog, I will focus on the different between goods and services in the qualities. Goods is homogeneous, once produced the quality is uniform across all line of products. They can be separated from the seller/ provider and not dependant on the source for its delivery to the purchaser. Services cannot be separated the service provider and heterogeneous.

Another key point is perishability of services and the non perishability of goods. Goods will have a long storage life and are mostly non perishable. Whereas services are delivered at that moment and do not have a long life or cannot be stored for repeat use.

Finally,goods and services are provider interaction becomes part of the service. For instance, in a restaurant, food refers to goods while the service is the waiters offering, the ambience, the setting of tables amongst others.

Summary:
1. Goods are tangible, and transferable while the services are intangible and non transferable.
2. Goods are separable, and non ‘“ perishable while services are inseparable.
3. Goods are homogeneous while services are heterogeneous.

References

Dr.Arie Karniel 2011, Managing the dynamics of new product development processes, Available from: https://books.google.com.au/booksid=Ux14684RdLYC&pg=PA234&lpg PA234&dq=Karniel%2BReich%2BPLM&hl=zhCN#v=onepage&q=Karniel%2BReich%2BPLM&f=false

Group 198 New Products

NEW PRODUCTS – EVOLUTION OR SIMPLY MIND BOGGLING

What do you think, how practical is an 8-wheeled car?

Eliica 640HP Eight-Wheeled Electric Car Review – YouTube

How about these products?  

       

       

        

Why do companies strive to develop new products?

Companies endeavour to ensure their survival and sustainability whilst seeking growth. According to the lifecycle theory, all things must end, and therefore, the demand for products may decline overtime due to a number of factors including:

• Market saturation
• Intense competition
• Changing customer expectation
• Accelerating technological change
• Demanding customers
• Technical diversity
• Capacity utilization
• Corporate pride

The case against introducing New Products, not limited to:

• Risk – the odds against success
• High Odds of Failure
• High Cost of Failure
• ‘Cannibalization’ of existing business.

Previously, companies followed a typical sequential approach to developing new products, and this involved progressing from a well-defined and highly structured phase to another, starting with the concept development phase through to final production. During the product development process, groups of individual phases worked in isolation of each other, i.e. Silo Effect – each group focussed on completing the tasks assigned to them, with minimum communication and interaction with the groups from the other product development phases.

Companies are faced with an increasing challenge of appealing to a more educated, well informed and discerning customers. Satisfying customers, delivering on their expectations and retaining them are essential for the success, stability and growth of companies.

Agility and flexibility are essential in today’s fast-paced and highly competitive world of new product development. However, companies have realised that the old, sequential approach to developing new product will no longer work, and it takes more than high quality, low cost and differentiation to achieve success in today’s competitive market.

Based on the above, various companies have changed their approach and moved to a team or “Rugby” approach, where the product development process is identified by a multidisciplinary team interaction, it has no predefined sequence, and rather, it allows for unsystematic progression in one of the product development stages and iterative experimentation.

Figure 1 shows the two types of new product development process.

a. Sequential Approach

b. Rugby Approach

Furthermore, to ensure the success of a new product and achieve customer satisfaction, companies engage customers in the product development process towards the final phases of the process “top-down” approach. Typical to engineering, pharmaceutical, financial and high-tech companies.

The LEGO group product development process provides a good example of how to efficiently design and produce new products. In 2004, the company streamlined its new product development process, by allowing the designers to engage non-creative staff and the marketing team who had good knowledge of kids’ preferences from market research. In addition, the company moved from the “closed” to “open” innovation mode, which involved engaging innovative members from the community, including children aged between 6 to 12 years, who can modify, develop or contribute to new designs.

The last two decades have seen many changes in the business environment including:

• Quick development of new technologies
• Globalization and increased international competition
• Continuing mergers, acquisitions, and strategic alliances
• Changes in values, expectations, and behaviour of the population
• Increased government and public scrutiny of business decisions

Due to the ongoing changes in the business environment, can marketing research through ‘crowdsourcing’ for example, improve the product development process? What new concepts and tools are required to help management improve the probability of successful new product development? What are the risks such as ethnical awareness or brand identity? Are all industries the same, why?

https://www-07.ibm.com/services/pdf/ibv_npsd_1.pdf

https://hbr.org/1986/01/the-new-new-product-development-game

http://eds.b.ebscohost.com.ezproxy-b.deakin.edu.au/eds/pdfviewer/pdfviewer?sid=698cdb08-9edd-4b7c-b4be-52ecdfe28988%40sessionmgr114&vid=5&hid=111

http://www.businessweek.com/printer/articles/53476-how-lego-revived-its-brand

http://www.dailymail.co.uk/home/moslive/article-1234465/When-Lego-lost-head–toy-story-got-happy-ending.html