Ripple Effect, March 2010
Abracadabraca - magic recipes for an immortal brand?
Product managers sales directors, finance directors and managing directors often turn to marketer's and expect marketing to magically sell products, increase customer footfall and dramatically increase revenues. Brand managers can raise the awareness of a good product, breathe new life into an old campaign but brands need an environment to grow and flourish. They flourish in open competitive markets and it is here that strategic brand management is a part of a company’s strategic marketing plans. But there are no fixed formulas for their ongoing survival. Companies must figure out what works for them.
Brand stewardship can be tactical – as Toyota’s strategy in the automobile industry shows. The Toyota way involves key steps in delivering brand equity – a superior product, efficient manufacturing systems that cut waste and clear market segmenting with each of its brands – the Lexus for the upper end of the market, Yaris for the lower end with a variety of models for the mid-market range. However, as soon as the key strategy fails - lower quality product, as recent events have shown, Toyota has faced customer and media criticism and has had to withdraw products from the market. The damage to the brand is likely to be deep and long. Or it can can be as aggressive as Pepsico’s strategy was in taking on Coca-Cola's market power. In some cases brands have to take a defensive approach, as Burberry’s attempt to defend its dwindling market position and protect itself against counterfeiting of its famous Burberry checks . Cheap fakes made across the globe has cost Burberry its luxury brand status giving it a more popular yuppie appeal. Fakes have also resulted in diminished revenues for the brand.
There are methodologies that can aid brand development such as the a five stage pattern outlined by Interbrand – product development and choosing a brand name for greatest impact ; creating awareness of the product or service; ensuring product availability by controlling supply and distribution-chains; getting the price right and understanding your competitive position in the market place and finally when the ground work is done inducing a sale.
In the last stage purchase leads to loyalty and as Benson and Kinsella say – there is no sixth stage - unless the spiral downwards. The sixth stage is when a brand loses its relevance or meaning and there are two choices a brand manager can make – to rejuvenate the brand or retire the brand.
So much for strategy – and it is tempting to say successful brand development depends on solely, completely and entirely on brilliant strategy but it is a fatal mistake. You can work on a brand name, create a logo design, figure out whether you are going to be a niche market player, a market challenger or build on the strengths of being a market leader. You work on the 4Ps – price, product, place, product and promotion. You even are smart and conduct a complete situational analysis – SWOTs (Strengths-Weaknesses-Opportunities-Threats), PLESTEDs (Political-Legal-Economic-Sociological-Technological-Environmental-Demographical), all that it takes to work on a smart diagnostic of the competitive environment you will be working in. You may even have the dedicated staff and be blessed with a management team dedicated to the improvement of your brand. And use the best marketing communications package – TV ads, posters, e-marketing, direct mail, sales promotions, memorable sponsorship – communicating a sound value proposition.
But there are key elements that are out of a marketer’s control. Brands exist in the hearts and minds of consumers. Doing what is right - beyond the legal requirements, to the ethical dimension matters, marketers can monitor what consumers feel about a brand but they can not control what consumers feel. A successful brand manager should check these external factors and use internal controls to maximise benefits or decrease risks. Brand owners and guardians can not assume their brands are all-powerful. Despite fears of anti-globalization protestors, brands are not overtaking the world. Brands create preferences but don’t have the power to sell products that consumers don’t want. For example, cereal manufacturers have not been able to sell breakfast cereal into the Indian market as they simply don’t appeal to the Indian palate So there is no holy grail. No black or white magic that can keep a brand alive. Marketers have to accept life is unpredictable and brand managers will just have live with life’s little uncertainties and mange what they can, the best they can.
An integrated sales, marketing and design strategy with realistic expectations, targets and information sharing is vital to create a strong brand platform. A brand is the sum of the product, the usefulness of the product to people, the price and the purchasing power of the customer, the ability for the brand to connect emotionally to a customer, the perceptions of the customer of the corporate values of the brand owner - the reputation of the company based on its actions, commitment to social responsibility and ethics towards its employees, suppliers and not just to customers.
Ethical marketing, fair trade, responsible supply chain management have become increasingly important global issues that need to be addressed and managed - not just from a legal, compliance issue but from the perspective of winning (not controlling) the hearts and minds of consumers.
Copyright concentric circles, March 2010. All rights reserved: No part of this newsletter may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording and/or otherwise any new media, without the prior written permission of the publishers. The paper may not be lent, resold, hired out or otherwise disposed of by way of trade in any form, binding or cover other than in which it is published without the prior written consent of the publisher. The position paper has drawn upon research from a select bibliography. No part of these materials in the bibliography have been used ideologically or verbatim, unless the author/s and publishers from which these ideas have been derived have been expressly quoted. The key documentation is from the experiences and research conducted by the author, Sumi Sastri., who asserts her intellectual rights to be identified as the author of this work.
First published by concentric circles, on www.concentriccircles.biz. All rights reserved by The House of Dharbha Ltd: 2010.For second rights or reproduction of any part of this position paper, contact info@concentriccircles.biz or write to The House of Dharbha offices at 7 Raynham Road, Hammersmith, London W6 0HY.