Objectives and Customer-Based Brand Equity
The chief marketing manager has to make objectives to find the new product’s name. They must determine how to address heavy liquor regulations that limit the promotion of alcohol. Another objective is to find a way to remain competitive by building brand equity among its customers. Developing Customer-Based Brand Equity (CBBE) for Cozy Vodka would involve use of a model with four steps which are identity, meaning, response, and relationships. According to Sürücü et al. (2019), the initial step of the CBBE approach is creating awareness by helping customers to view and recognize the product from the brand’s eyes.
The second step is communicating the product’s meaning by telling the target customers what it stands for (Sürücü et al., 2019). This involves creating a performance image of how well the product meets consumer needs. The next step is to reshape how customers think about Cozy Vodka using their responses. This could include improving the quality, product relevance to customers, and credibility (Sürücü et al., 2019). Lastly, Crown Distillers should develop a deeper bond with its customers through various ways, such as online conversations and hosting brand promotion events.
Umbrella Brand Vs. Individual Brand Name
Umbrella brand name entails giving various products one brand name. It also involves forming a positive brand equity for one brand name as opposed to many (Dube, 2019). Umbrella brand name is suitable for introducing new products to the market because it follows the psychological aspect that the new products matches the satisfaction and quality level of the existing products. Individual brand name is a name given to a product and is marketed separately from its parent brand (Dube, 2019). The aspect aids in establishing a unique identity and image of the new product and take a distinct position in the competitive market. Individual branding is appropriate for introducing new products to the market where the management lacks confidence on the existing image of their brand.
Furthermore, it is practical to take a competitive position in the market. The problem with this strategy is that it takes time to earn customer brand equity. It also requires the creation of a brand name which must be done in protection of other company brand’s images (Dube, 2019). The name must also be meaningful, rememberable, recognizable, unique, and accessible for easy development of customer equity (Dube, 2019). Cozy Vodka should adopt the umbrella branding because the product will have ready customer brand equity and will need less promotion because the reputation of other products sells it.
Effect of Strict Government Regulations
Stricter government rules can reduce the efficiency of product promotion. Governments impose more rigid rules on alcoholic drinks to control their usage to protect public health (Chung et al., 2022). These rules limit the extent to which an alcohol brand can advertise its products. In most cases, these regulations prohibit integrated marketing communications, thus reducing the chances of promoting the drinks (Chung et al., 2022). In return, the restrictions limit the chances of alcohol brands creating customer-based brand equity and sales.
Strategic Options for Growth
If Crown introduces another rum drink, they will have chosen concentric diversification while exploring another category will be a product development strategy. Crown should consider introducing another rum drink because it will have a ready and familiar market. Concentric diversification is better than product development because the Crown will not need government permission to develop a similar product (Johnson et al., 2020). It entails changing a few factors, such as flavors or the drink’s distillation process, and selling it to rum drinkers (Johnson et al., 2020). On the contrary, developing a product will need investment in research and development, acquiring the rights to produce it, and branding the product, among others.
References
Chung, A., Zorbas, C., Riesenberg, D., Sartori, A., Kennington, K., Ananthapavan, J., & Backholer, K. (2022). Policies to restrict unhealthy food and beverage advertising in outdoor spaces and on publicly owned assets: A scoping review of the literature. Obesity Reviews, 23(2), 13-386. Web.
Dube, JP. (2019). The economics of brands and branding. In B. J. Bronnenberg, JP. Dubé, & S. Moorthy (Eds.), Handbook of the economics of marketing (pp. 291-358). North-Holland.
Johnson, G., Whittington, R., Regnér, P., Angwin, D., & Scholes, K. (2020). Exploring strategy. Pearson UK.
Sürücü, Ö., Öztürk, Y., Okumus, F., & Bilgihan, A. (2019). Brand awareness, image, physical quality and employee behavior as building blocks of customer-based brand equity: Consequences in the hotel context. Journal of Hospitality and Tourism Management, 40, 114-124. Web.
