Welcome to class of Services and Brands

byDr. Satyendra Singh

University of WinnipegCanada

Services• Product: value physical Appearance• Services (consumer/industrial): ValueProcess• Services are major of world business

– Service/total export= 30% in UK--highest – CanadaAgri, eng, insurance, r&d, mgmt. Consulting…

• Definition of Services– Intangibility

• Insurance, dry cleaning, hotel– Inseparability

• Production and consumption is simultaneous– Heterogeneity

• Individually produced, slight variation– Perishability

• Cannot be stored

Barriers to Entering International Services Markets

• Protectionism– Professional pass certification exam in local language– Recognition of foreign credentials– Restricted movement of people– Intellectual Property

• Trade-Related Intellectual Property Rights (TRIP)/GATTimplemented

• Piracy—India, China

• Data Transfer Across Borders– Individual data e.g. consumer preferences, insurance

• Cultural Barriers– Smile while serving, talking in the class, tip x% in the USA,

round fig. In EU, No tip in China! Long vacation packages for Japanese (10 days) vs. Las Vegas – 4 days

Opportunities in International Services Markets

• Insurance• ATM• Cable TV• Sports Events• Beijing Toronto International Hospital• Higher Education Demand (MBA) in India• Call Centres• After-Sales Services (SAS)

– Standard Aero– spare engine while plane under repair!– P&G train superstore mgrs – ordering cycles and shelf stocking– Firms need to be responsive– Multi-site service centre – industrial products– Include local firms to improve SAS

Brands

• Explains a product and what it stands for• Brand is a function of

– Years of advertising– Good will– Quality evaluation– Product experience– Other attributes the market associates with the product

• Soon brand value will appear as assets on balance sheet!• Increase in travel by consumers

what type of a person a brand be if it were a person?

Dimensions of Brand Personality

Brand personality

Sincerity Ruggedness

•Down-to-earth•Honest•Wholesome•Cheerful

Excitement Competence Sophistication

•Daring•Spirited•Imaginative•Up-to-date

•Reliable•Intelligent•Successful

•Upper class•Charming

•Outdoorsy•Tough

Source: J.L. Aaker, “Dimensions of Brand Personality,” Journal of the Marketing Research, August 1997, p. 352.

Perfume Personality Dimension

How to introduce personality in a perfume

Personality of the perfume?

Personality of the perfume?

Personality of the perfume?

Marketing Strategy (Personality)

some traits are more desirable than others some traits may be even undesirable your personality should match most closely with the product It is an expression of yourself Concept of Brand Personality (BP) BPs are often the basis for a long-term relationship with brand

How to measure a Brand? (42-item construct)

Brands• Brand strategy at international level important• Four Branding Strategies

– Luxury Brands– Global Brands– Multiple National Brands– Private Brands

Luxury Brands• This sector is growing in emerging markets• Differentiation• Ego satisfying products/services• Key message may Indicate

– Success, Confidence, ↑ mobility in Society

• Armani• Burberry• Ferragamo• Gucci• Hermes• Louis Vuitton

Global Brands• Same Positioning Globally!• Focus Strategy to Target Specific Customers

– Market is large– Economies of scale in marketing, production and distribution– Reduces distribution costs– Product standardization– Transportation, storage, inventory management more efficient

• Centralize the Concept• Decentralize the Execution

– Market information from local team• Top 10 brands Majority US brands, See Value in it• No Canadian Brand in Top!

– Commodity oriented– Relatively small size of firms– Attitude towards global branding is weak

Top 10 Global Brands

Source: Robert Berner and David Kiley (2005) “Global Brands,” Business Week, August 1, 2005, p. 90-91.

Canada’s Best Brands

Source: Timothy Woolstencroft and Jeannette Hanna, “Well-managed Brands is All About Creating CustomerExperiences,” Spencer Francey Peters: Media Room. July 29, 2004.

Multiple National Brands• Global Branding May Not be Possible

– Translation has obscene meaning in foreign language– It does not appeal to patriotic consumers– Local brand has more market share or awareness– Foreign country is reputed for the product (technology in Japan)– Needs adjustments for

• Type of product• Diversity• Market needs and preferences

• Country Image Effect– English Tea, French Perfume, Chinese silk, Italian leather…– Adjust brand name that sounds close to the language of the country

• Country of Origin Effect– Mandated requirement to write made in …– Country of base material – Canadian law (cloths)– Russians like foreign goods (Finland), but homegrown foods– Europeans have love-hate relationship with US products

Private Brands• Private Brands typically are not exported• Private Brands are Threat to Foreign Brands

– Formidable competitors– High margin– Receive preferential shelf space– Strong in-store promotion– Appeal to consumers– High quality as low price

• To maintain market share, global brands need to be priced competitively and provide real value to customers