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Brand Management Class Notes- Nov 29

Brand Management Class Notes- Nov 29 - Brand Management...

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Brand Management Class Notes- Nov 29 Introduction Your reputation for innovation really drives perception of leadership. We looked at how various companies do that, and one is to find something in the history of your company that speaks to innovation. One company that leverages perception is IBM, and one company that lost out by not doing that was Kodak, because many of us think that many of us do not think that Kodak does not know much about photography. Why was Intel seen as a leader? In many cases, A&E chips are functionally equivalent to Intel ones, yet Intel has a 50% higher price margin, and the bottom line is that Intel as the much larger company, can spend more on advertising and also because of its leadership, Intel is always in the news. This happens week after week, so we are left with the perception that they are the leaders in technology. PR is much more influential than advertising in shaping perception of leadership. It is also much cheaper. Now, to wrap up the leadership section is two other mini cases. Volvo The first of our mini cases is Volvo. I think you all agree with me that Volvo is seen as the leader in automotive safety. How do you think that Volvo has built up this reputation? They had a real history of safety and innovation which led them to a safe product. In a certain ad campaign, they showed their history of innovation and safety. I was shocked to discover that the front bumper of the car, something so basic, is something that Volvo invented in 1915. That was about 100 years ago, so it is a reality, they do build safer cars. They used consistent messaging, they talked about the reality. It’s not something that they hid, like Kodak. This was the very first print ad that Volvo ran in North America, they highlighted safety in here. In 68, they start incorporating safety into their ads. 75, they talked about crash dummy testing. They did really well in these crash tests. 84, you see the safety cage where you see Volvo crash test results. To this day, 2010, 34 years later, they’ve been talking about safety. They always leverage their history of safety and innovation in their PR, they are very clever in how they generate it. In 1999, they were launching a new car in the Auto show, so showed a …. At the auto show. Naturally, all the media came and covered this. And every time Volvo launches a new car, which is pretty much every year, the media coverage views of the new car, the first sentence invariable is all the new safety features that this car has. This is not a company that says “you know. Safety was important 50 years ago. It’s time to move on.” They are using this as a foundation to build on, it keeps coming up. If you want to be seen as the leader, you want to be seen as number one. That communication needs to single minded… all of us in this room connect safety and Volvo, because they consistently talk about it. The downside to consistency is that if everyone thinks you are safe, they are afraid that it is all you are. This is the box that Volvo is in, and what would you do if you were Volvo’s owner and you
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