UCSD MGT 100 Week 08
An idea that shifts preference
Brands reside in consumers’ minds
JP Morgan purchased behaviorally-targeted display ads on 400,000 distinct domains in 2017
Reports found ads next to hate speech and terrorism
JPM narrowed ad buys to 5,000 domains and 1,000 “human-checked” YouTube channels
- Brand safety concerns: YouTube (2017), Facebook (2020), Twitter (2022)
- Some brand safety consultants "shame" brands based on ad buys
- Public "shaming" is a related brand safety issue; different audience
- Brands can ignore, curate or seek out political associations
Credibility
Rapid communication
Personality & Self-expression
Gestalt
Names and graphics
What is the value proposition?
Express shared identities: UC San Diego, San Diego Padres
Personify seller attributes, eg Jordan Brand, Kylie Cosmetics
Common brand “personalities”
Best practice: Match brand personality to
We can pay a celebrity brand \(\$W\) to sponsor our phone. Market research indicates sponsorship will increase phone brand utility from \(\hat\beta\) to \(\hat\beta'\). Should we do it?
Let \(\pi_0=q_j(p_j-c)\) be current contribution assuming optimal pricing
Let \(q'_j(p_j)=N \hat{s}'_j(p_j)\) be celebrity-sponsored demand
Calculate \(\pi_1=q'_j(p_j)(p_j-c)\)
Find new optimal price \(p'_j\) for demand \(q'_j(p_j)\)
Calculate \(\pi_2=q'_j(p'_j)(p'_j-c)\) ; associate with celebrity if \(\pi_2-\pi_0>W\)
Discuss: What if celebrity’s threat point is to associate with a competitor?
Discuss: What if celebrity association persists multiple years?
Discuss: What if 20% chance a celebrity scandal reduces \(\hat\beta'\) to \(\hat\beta''\lt\hat\beta\)?
Revenue Premium as an Outcome Measure of Brand Equity (JM 2003)
Advertising and brand attitudes: Evidence from 575 brands over five years (QME 2019)
Consumer Misinformation and the Brand Premium: A Private Label Blind Taste Test (MkSc 2020)