10/18/2013

Brand Management
MK542E
Brand Architecture

Dr. Dildar Hussain

Assistant Professor
ESC Rennes School of Business
Office No. 315
dildar.hussain@esc-rennes.fr

Chapter Overview
Overview
What brand architecture or brand structure is?
Different branding approaches
How to choose an appropriate brand strategy?
Environmental pressure on branding

Learning Objectives
Appreciate the concept of brand structure
Select an appropriate brand branding approach
Examine the growth of licensing and strategic alliances in branding
Examine brand structure in international markets

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Introduction
With more targeted marketing, it has become
More complex
Global
Dynamic

Brands are owned by other brands which, in turn,

are owned by another set of brands
Branding management, now a days, is not
all about managing single brands but managing
portfolios

From Brand Management to Brand Portfolio Management

Same company can sells products to different segments
Different products may be positioned differently
Some thoughts about brands
Branding, an important topic of interest for research
Becoming difficult to create new brands
In future, building a brand may only be possible through acquisition
Other issues include, changing brand management , takeovers, high turn-over of brand
managers

Focus on existing brands and corporate identities has increased

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Strategic Balance of Brand Portfolio Management - 1

Brand portfolios are result of a process
Brand accumulation , transition, and reduction
of brands
Organization of relationships between brands
Development of brand portfolios to gain
competitive advantage

Therefore, brand portfolio deals with both the internal and external environments
Brand portfolio influences (CIM, 2003)
R&D
Marketing resources
Cost efficiency
Growth, etc.
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Strategic Balance of Brand Portfolio Management - 2

Six ways in which portfolio management could
enhance growth
Clear prioritization of future focus by major market
Prioritization by brand and product
Concentration of expenditure on priority market,
brands and products
Operational cost saving through simplified business
Disposal of brands that dont fit
Gap filling by product development and acquisition

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Strategic Balance of Brand Portfolio Management - 3

Five step approach for
optimizing brand portfolio
Decide on brands to review
Shortlist all of the brands and analyze each others
contribution to the company (contribution)
Assess brands according to current market
performance (traction) and future prospects
(momentum)
The brands are classified along those three dimensions
(contribution, traction, momentum) to identify challenges and opportunities and
enable brands to be sorted into
Power: A brand that needs to be defended ferociously
Sleeper: A brand that with a little tracking can build into a power brand
Slider: A valuable brand that has lost momentum and needs immediate intervention
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Strategic Balance of Brand Portfolio Management - 4

Soldier: A solid brand that contributes quietly
without need for much management attention
Black hole: A brand that sucks up resources and
may or may not ever pay out
Rocket: A brand that is on its way to power-brand
status
Wallflower: A small, underappreciated brand with
loyal customers, often under prices and under marketed
Discard: A brand that should have been discontinued years ago

The objectives for individual brand are tied together into an overall plan, which will
include any changes to the roster, brand architecture and resource allocation

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Brand Hierarchy - 1
Six brand naming strategies
Corporate brand name
Company names across virtually all their product range
Shell, Kellogs , Total

House brand name

Group of companies /brands
VW group

Family brand names

Family of products
Nestle
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Brand Hierarchy - 2
Mono brands
Independent brands
Proctor & Gamble (Ariel)

Virtual Brands
Used to identify variants of products
???

Description
Used to describe a variant of a product with description
Knorr beef stock cubes

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Brand Hierarchy - 3
Monolithic structures
Organizations using one name and
one visual style

Endorsed structure
Corporate identity used in association
with name of subsidiary /brand
Corporate dominant
Mixed brands
Brand dominant

Branded identities
Totally different brand names and visual styles
Mono brands

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International Brand Structure - 1

Choices for branding in international context
Use the same brand in different countries
Leverage brand strength across boundaries
Maintain local brands to meet local customers
preferences
Choose a brand structure or architecture that
suits

Corporate-dominant structure
Product-dominant structure
Hybrid brand structure

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International Brand Structure - 2

Determinants of international brand structure
Firm-based factors
Organizational structure
Expansion strategy
Mode of expansion (acquisitions, organic growth
or strategic alliances)
The importance of corporate identity
Diversity of product lines and product divisions

Product market characteristics

Nature of the product market(s)
Whether homogeneous market or global consumers
Market integration and competitors, cultural embeddedness of product
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Environmental Pressure on Branding

From mono brands to corporate brand
Simpler and cost effective
Market complexities
Competitive pressure

From corporate brands to mono brands

Market segmentation
Differentiation to avoid cannibalization
Failure in finding synergies of corporate branding

Anti-globalization movements

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How Can Brand Licensing Boost Business?

Licensing a contractual permission to use a brand
in association with a defined product, for a defined
period of time, in a define territory
A brand owner can extend trademark or character
from its principal environment onto to products of
a completely different nature
Licensing can
Expand the product portfolio
Drive new revenue streams through licensing opportunities
Increase the brand global awareness
Inspire customer loyalty and build brand equity
Fuel valuable promotional and retail partnerships
Make the brand more lifestyle oriented

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Brand Licensing More than Product Extension

Strategic Questions
What is strategic benefit of licensing?
What are the target product categories?
How is the licensing strategy related to the brand strategy?

Resources and capabilities Questions

Does the company has experience in and negotiating and drawing licensing agreements?
What is current new product development process?
Is the company prepared to carry out the technical inspection of the licensee?
What support will the company offer to the licensee?
Does the company has resources to implement the licensing strategy?
Enforcement of copy rights ??????????

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Brand Structure / Architecture of VW Group

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Case Study
Brand Strategy Positions Products Worldwide

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Video of the Day

http://www.youtube.com/watch?v=-P-2hDG5kKk

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dildar.hussain@esc-rennes.fr

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