branding panel slides - milken...
TRANSCRIPT
BrandingKeeping Your Company On Top
• Convenient, Modern Store Facilities
• High Quality Perishables
• Unique Private Label
• New Departments
• New Services
Growth of Safeway SELECTNumber of SELECT SKU’s
2002200120001999199819971996199519941993
1400
1200
1000
800
600
400
200
0
Number
147275
352
710770
902
1040
11511256 1265
Safeway The Clear Leader In Service
First Place (0-20% Lead)
Less Than First Place
Commanding Lead(> 20% Lead)
*As Of Third Quarter 2002
DIVISIONA JB C D E F G H I K
Greet
Anticipate
Take
Thank
Sample
Carry Out
Parting
Checkout
OOS
Adjust Pricing
• Lower Regular Retails On Certain Items
• Remain Promotional
• Narrow Gap With Discounters Over Time
“The primary focus of the brand message must be on
how special you are, not how cheap you are.”
-Larry LightExecutive Vice-President ofMcDonald’s Corporation
More than 50% of customers are willing to try a new product from a preferred brand because
of an implied endorsement.
Scott DavisBrand Asset Management
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Survey – “I Currently Avoid U.S. Products and Services”
U.K.Germany
JapanItaly
FranceCanada
RussiaSpain
30
25
20
15
10
5
0
Percent
Using a scale from 1-10 with 10 being “full agreement”, the percentage of people who marked 7-10.
Advertising Icons of the Century
1989The Energizer Bunny
1890
1900
1920
1930
1940
1950
1960
1970
1980
1893Aunt Jemima 1939
Elsie
1921Betty Crocker
1928The Green Giant
1955The Marlboro Man
1965The Pillsbury Doughboy
1963Ronald McDonald
1990
2000
1898The Michelin Man
1951Tony the Tiger
Financialsoundness Social
responsibility
Employee talent
Use of corporate assetsLong-term
investment value
Quality ofproducts/services
Innovation
Quality of management
Key Attributes of Reputation
The Changing Role of the Brand
“Reputation, reputation, reputation! O! I have lost my reputation. I have lost the immortal part of myself and what remains is bestial.”
William Shakespeare
“A good name is better than riches.”Cervantes, Don Quixote
The Changing Role of the Brand
• Why do customers defect?– 1% Death– 3% Move– 5% Influence of friends– 9% Lured away by competition– 14% Dissatisfaction with the product– 68% Turned away by attitude of indifference
on the part of the company employee
The World’s Most Valuable Brands2002
Brand Value $Billions
30.9Intel
41.3GE
51.2IBM
64.1Microsoft
69.6Coca Cola
Fortune’s Most Admired Companies20021985
Hewlett-Packard
3M
Dow Jones
Coca-Cola
IBM
General Electric
Dell Computer
Berkshire Hathaway
Southwest Airlines
Wal-Mart
Goodwill - the Origin of Brand Valuation
Goodwill as % of price paidVendorAcquirer
66%VerkadeUnited Biscuits
75%TreborCadbury Schweppes
88%PillsburyGrand Met
83%RowntreeNestle
Intangible Assets are Increasingly Important
Ratio of Goodwill and Intangibles to
Total Assets
61%Kraft Foods
65%Comcast
78%Viacom
84%Clear Channel Communications
84%AOL Time Warner
The Value of BrandsTotal Return to Shareholders Relative to Industry
130 Companies
Weak Brands
Strong Brands
Diversified Brands
Focused Brands
+0.9%
+5.0%
-3.1%
+1.9%
Brand Leverage
Future Leverage Potential
Historical Leverage
Gap
Schwab Kodak
Nike
Levi’sSprint AT&T
Wal-Mart
IBM
AmericanExpress
GE DisneyIncreasing diversification
Increasing diversification
Increasing Brand Value
+12%Starbucks+12%Dell+13%Harley-Davidson+16%Nivea+30%Samsung
2001 to 2002Change