Brands are critical to markets, while customers are critical to brands. Hence, companies should design customer-centric brands and offer value-based brand services to customers to gain high brand equity and brand value. Companies continuously innovate brands to offer competitive differentiation against rival brands in the marketplace, in order to provide value enhancement on brands to the customers. Success of a brand strategy is based on innovation and competitive differentiation that stays for the long term. Most emerging companies need to brand an innovation and position it competitively in the marketplace. Brands can make all the difference in the market if they are managed properly against competing brands. Brands should reveal value, exhibit image, build personality, and enhance brand equity in the market. A brand is an integral part of a coherent strategy, supported by actively managed and adequately governed brand-building programs.
If you ask consumers what comes to mind when they hear the name of a big brand such as BMW or Gucci, they will reply with a list of attributes which go far beyond the physical, tangible aspects of product and delivery. But the one word that brings all these things together in people’s mind is value. Time and again, research has shown that the real driving force behind market leadership is perceived value, not price, nor inherent product attributes. As long as a brand offers the customers a superior perceived value, good market performance follows, which makes consistency a highly important feature of brand behavior. Hence, it may be stated that consumers cultivate relationships with brands in convergence with social values and culture.
Brand Incubation
Brands are also successful because people prefer them over unbranded products. In addition to the psychological factors already mentioned, brands give consumers the means whereby they can make choices and judgments. Based on these experiences, customers can then rely on chosen brands to guarantee standards of quality and service, which reduces the risk of failure in purchase. Today’s world is characterized by complex technology, and this can be extremely confusing to the people who are not technology minded. Brands can play an important role by providing simplicity and reassurance and offering a quick, clear guide to a variety of competitive products. It may be stated that animism is another process mechanism that directly explains the specific ways in which the vitality of the brand can be realized.1 Over time, personalities of the spokespersons are transmitted to the brand. Obviously, this aspect is not in control of marketers and the brand personality is indirectly created by all the elements of the marketing mix.
Companies with flagship brands follow an outside-in approach to manage brands in the competitive marketplace. Brands are built and communicated to create clear awareness among customers, and are supported by the required set of management skills. Toyota has built the Lexus brand of luxury car meeting the expectation of technological perfection by managing quality processes. Building a customer-centric brand demands that managers balance business skills with brand quality and competitive advantages. The outside-in approach helps companies nurture reputation and for high-quality brands to gain a customer’s trust and deliver a company’s promises. Companies with robust brand leadership attributes drive managers toward setting sustainable brand management strategies and designing brands to serve the marketplace. Companies also engage brands to serve customers and meet their expectations. Most companies learn lessons over the performance of previous brands, and make efforts to build new brands by analyzing the feedback of customers and observations of the employees of the company and other market players. In the process of building strong brands, companies invest in brand management programs that attract potential customers, and sustain in the marketplace among competing brands. It is necessary to track the performance of brands over the long term.2
Many consumer goods companies build brands through big-box discount retailers, and position them through short-term price promotions in the mass consumer segments. Companies manage consumer brands with price-sensitive strategies to sustain long-term market challenges. To enhance the value of consumer brands and profitability, corporate managers consider long-term measures, and use them to make smarter marketing decisions. Many factors affect the sustainability of brands in the market. Besides brand personality, image, attributes of brands, trust, and responsiveness of the brand; the legal validity of a brand has become a major risk in the contemporary age. Genericide refers to a situation where brands lose their legal protections because their original name has become the generic term and no commercial brand name has been given to it. Such brand risk emerges for a new category of products in the market where the generic brand first helped to create its image. The Genericide effect of brands in the pharmaceutical industry has been responsible for the outgrowth of Generic Interchange brands with low price attributes of various pharmaceutical products in the regional markets.
Analyzing the responses, companies should develop their brand management teams and strategies, and engage consumers in the brand-building process. Such an explorative brand development and management approach would reveal new opportunities to reinvent brand management processes. The right management strategy creates long-lasting advantage for the brand when it moves to the market and takes over the competition as a challenge.3 Corporate branding strategy is based on the image of the firm and its products in the marketplace. Corporate branding can play a critical role in building a company’s brand portfolio. It can help differentiate the branding, support brand-mix, facilitate brand management, build credibility, and provide customer awareness through effective brand communication. Successful management of the corporate brand requires the firm to address a number of challenges including maintaining its relevance to the company’s strategy, and demonstrating its benefits to consumers.4
Brand Launch
Brands have grown wild by the early twenty-first century in the global markets due to bi-directional dynamics of companies from international to regional markets and vice versa. Most brands grown in global markets have been modified in their attributes and deliverables, and reassigned to suit the consumer preferences in varied destinations. Digital marketing technology has made brands more vulnerable to substitution today due to the viral effects of experience sharing by the consumers. However, digital technology has tightened control over brand messages through digital channels and social networks. Mergers and acquisitions have further added the risk of overlapping brands and their associated business values with the consumers within the brand portfolios. The relationships between brands and their customers have now become more open-ended as online discussions extend the brand experience after purchase. Multinational customer-centric companies manage their brand portfolios considering the following strategies to stay sustainable in the marketplace:
Making brands distinctive: | Companies develop strategies to deliver relevant, distinctive, and credible value to customers. They offer benefits and experiences of brands and differentiate them through superior positioning relative to competitors. Such strategies are also used in repositioning established brands to meet customer needs effectively. |
Optimizing brand portfolios and new designs: | Companies launch new brands and sub-brands continuously to compete with their rivals and serve the changing preferences of consumers, which endangers the roles and relationships of brand assets within a portfolio. Such trends in branding pose major challenges to companies in consolidating brands, reducing value-based complexity, and brand-overlap. Brand designs should incorporate the 4As comprising attributes, availability, affordability, and adaptability. |
Delivering the brand promise at all touchpoints: | Consumer-centric companies make greater efforts to deliver the brand promise at all touchpoints with the customer, both online and physical deliveries. The current business and the modern multichannel environment drive companies to co-create the brand value and deliver a consistent brand experience, and collaborate effectively with the consumers in implementing brand strategies. |
Supporting consumer decisions: | Companies should be able to develop branding capabilities to guide consumers in making pro-brand decisions in response to the brand strategies of the company. |
Companies in the competitive marketplace analytically measure their brand power and map current brand positions. Brand performance is commonly measured by the company in reference to the volume of sales stimulated by the effect of individual brand tactics within the brand portfolio. Skill needs to be acquired in positioning the brand against the competitors’ brands, and the brand-line mapping is an important planning exercise to perform this task. Such an effort is also beneficial in identifying market segments according to the customer preferences. Table 1.1 presents the different components of the brand-line analysis and task involved thereof.
Table 1.1
Brand-launch analysis: Task and approaches
Analysis components | Task | Approach |
|---|---|---|
Sales and profit | Identifying vulnerable items on brand line | Quantitative and time-series data on variables |
Market profile | Brand positioning | Competitive brand profiles analysis—physical & monetary |
Line length | Optimal length comprising a number of items | Analysis of stretching and filling options |
Stretching | Moving the brands to premium or mass customer segments | Downward/upward stretching |
Filling | Adding new/missing items | Lowering the brand price or new launching |
Featuring | Increasing brand attractiveness and volume of sales to push brand share | Customer orientation to be made at high end of line with a matching price |
Pruning | Repositioning the slow-moving brands to optimize the brand line | Cost-effective decision-making, eliminating low-sales items |
Rearranging portfolio | Brand diversification and new brand line | Market-segmentation, demand analysis and pricing strategies |
The brand-line length in a company may be required to stretch downward or otherwise to optimize the line length. In other words, it is the responsibility of the brand-line manager to establish a positive correlation between the number of items and the sale-profit targets of the company. The brand line should not be constant. It has to be extended over time, systematically in two ways: by stretching and filling. The line can be stretched either downward, or upward, or both ways depending upon the range of competitors and the brand lines simultaneously existing in the market. The downward stretch results in selling the upper end brands initially at cheaper rates on the brand line. This strategy has to be used very carefully, as losses may pile up through a volume of out-fashioned stock. However, the item image largely depends on the brand name. The upward stretching of the brand line is risk averse. Such an approach allows selling the brand-line items at a high price, as the managers are attracted by higher growth rates and profit margins. However, there always remains a threat of price ‘fall-out’ from the higher end competitors, and of introducing a substitute at a lower price from lower-end competitors. Finally, the sales personnel of the company and distributors have to manage the crisis. The company, at the stage of ‘maturity’ of its growth cycle, may use both the upward and downward stretching of the brand line in different market segments. Adding new items or missing items on the sales stream of the market can also stretch the brand line. The featuring of the brand-line items indicates that a few of them have been selected and are being set at a high price and sales target. It may be observed that during Christmas, all consumer goods and durables are sold at relatively higher prices as the sales managers motivate the customers to buy the goods locate...