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Category: Brand Strategy

Brand Strategy

Brand Portfolio Strategy Explored

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Brand Portfolio Strategy

Why do some companies maintain multiple brands within the same category even though it is more expensive to do so? 

  • The brands appeal to different market segments and have different positions in the market
  • One brand is an upscale or premium brand
  • One brand is a no frills brand targeted at price conscious consumers
  • The additional brand uses an older formulation or technology and may be sold as a “cash cow”
  • The second brand could draw on the core brand’s quality and service perceptions without being that brand. This is useful with market segments that are more price conscious but that still appreciate high quality and service levels.
  • The additional brand is created to establish a higher reference price in the category (often increasing the perceived value of the core brand)
  • One is a “flanker” brand, designed specifically to compete directly with other brands in the category, while protecting the company’s flagship brand from direct competition
  • One or more brands are created to reduce or eliminate channel conflict issues
  • The new brand may be a way to take a company’s products [and, in some cases, a variation of the core brand] out to new channels or customers without alienating current customers
  • Some brands are created to meet specific retailers’ needs within the category
  • The additional brands may be created as “private label” brands for specific retailers
  • The additional brand may allow the company to acquire more shelf space
  • The company can use the additional brand to experiment within new channels without affecting the core brand(s)
  • The company maintains multiple brands to encourage vigorous competition between brand managers
  • To create more perceived variety at retail without giving sales up to the competition
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Brand Strategy

Brand Strategy And Customer Memory

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Brand Strategy And Memory

Paul Marsden’s piece on “Thinking Fast and Slow” raised some great marketing implications from Daniel Kahneman’s work that are well worth reading.

I loved the thinking about experiences versus memories, and the observation that our “remembered self” is the one that matters because that’s what motivates us. In the piece, Marsden discusses Kahneman’s theory of “fast thinking”, which is the non-logical thinking that powers consumer decision making. It reminded me of some notes I made some time back while re-reading Malcom Gladwell’s Blink.

This was the question I scribbled in the margin. “If blink is the phenomenon of knowing before you know – then what is your brand’s blinkpoint?” In other words, what is the subconcious association you want consumers to have the next moment they encounter your brand before they even recognize how the brand makes them feel? What will they know before they even know it’s the brand?

Gladwell fans will also get the reference to “tipping point” in this blinkpoint idea because that associative memory of a brand and its meaning is something that I’d like to suggest accumulates and accelerates over time. The memories we have of a brand reach a critical point where, from then on, they drive the experiences we anticipate.

But if buyers have a bad experience, three things happen:


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Brand Strategy

Brands And The Power Of Joy

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Brand Strategy And Joy

From a marketer’s point of view, numbers don’t drive recessions. They may start them. They may justify them. But they don’t actually make them happen. What drives recession in a consumer economy is very much the same thing that drives boom: emotion. When enough people believe in it, it will happen – and that’s because there will be enough people acting in a recessive way for the mindset to become embedded, and for the behaviors to seem logical, sensible, responsible, unavoidable.

Commoditization works in much the same way. As something becomes more commonplace, as the standards rise and the costs of production fall, the expectations that all the products are the same also increases and people become more motivated to look for the cheapest option. It makes sense. It’s the obvious thing to do.

As consumers, the less we enjoy something, the less it surprises us or motivates us, the less that it elates us, the less we are happy to pay. The more people who feel less, the greater the loss of value (because then the effect shifts from being individually-sensed to being collectively endorsed)

We can monitor that fall-off in value now to a high degree of granularity. Data and algorithms drive so much of how brands do business today. Businesses take comfort in that because it delivers patterns and predictability. But it also brings with it a shift in emphasis. More and more brands find themselves focusing on what the numbers are doing. And that’s a dangerous reference point for a marketer – because the focus moves away from the human drivers of why people buy (and what generates value) towards the non-human drivers of what is being bought (and what most companies value themselves). In time, customers become an expression of the numbers, not the other way around.

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Brand Strategy

10 Brand Keys For Persuasion And Change

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Brand Strategy and Persuasion

So often it seems to me brand owners hope to bring about change rather than planning to bring about change. They see persuasion as an awareness issue rather than as a behavioral issue – often because they regard their product as the obvious choice that somehow, miraculously will spark a “road to Damascus” moment as soon as consumers encounter it. To that end, they pad out their media schedules with as much presence as their budgets can muster and throw huge amounts of energy and disarming levels of resource into whatever is trending on social media.

So I was very interested in an article on willpower in the NZ Listener recently that refers to key elements that persuade us to behave differently. It includes some great thinking from David Thomason and the planners at Draft FCB who, like more and more of us in the marketing sector, are looking to the behavioral sciences for clues on ways to shape brands and the behaviors that make brands gel for people.

The article quotes psychologist Robert Cialdini who decades ago listed 6 key factors that persuade us to make lasting changes:

1. Reciprocity – actions we take based on direct or indirect mutual gain

2. Commitment that can then be carried out consistently – habits, once formed, rapidly become addictive

3. Social “proof” – the power of the crowd to compel the individual

4. Authority – following the bidding of those we perceive as strong, respected or in a leadership role

5. Liking – we’re drawn to, and much more easily persuaded by, people and brands we are inclined towards emotionally

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Brand Strategy

Brand Building With A Better Offer

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My friend and colleague Erik du Plessis once observed to me that “survival of the fittest” was really a misnomer and that it should be “death of the least fit.” As he noted, the lion gets up every morning knowing that it just needs to be faster than the slowest buck, and the buck wakes up knowing it just needs to be faster than the slowest in its herd.

His comments are entirely relevant to the analysis presented by Chemi in Bloomberg Businessweek. Companies and brands do not need to be the best in their industry to survive, they simply need not to be the worst. However, another factor not considered by Chemi’s analysis was price. If a brand wants to command a price premium it needs to offer a better than average experience and be seen as different in a good way.

If all the companies in a product or service category are viewed badly by consumers, then it may not matter if they are dissatisfied with their current choice since they have no obvious alternative. Lacking alternatives they simple have to tough it out, getting more disgruntled and resentful the longer the poor experience continues. Particularly where service contracts or annual fees are involved, people will have limited opportunities to switch and prior experience of changing provider may prove painful and futile. Of course, from the company viewpoint it is a great business model to have customers who feel trapped and feel they have nowhere to go. You can squeeze as much profit out of them as possible… until, that is, someone comes up with a better offer.

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