Mastering Brand Strategy
Does your organisation have multiple brands to manage? Sometimes customers can have a stronger connection to a product level brand than an organisation brand. This can have implications for leveraging customer value and costs over time. The most common question I get asked is whether this is a problem?
It can become a problem if your master brand is going to be used to present new branded products and services to this customer segment i.e it becomes an "umbrella brand". This can catch some organisations out if they have no long term brand strategy in place. The key is to ask the questions early on and plan for extendibility of the brand. Try and factor in the introduction of new brands if this is in the pipeline.
For example, suppose Company A introduces software as a service "product A" to a group of customers. In one case Company A communicates predominantly as "Product A" because this brand is designed to fit this group of customers perfectly. An alternative case, is that over time Company A develops new products and services. If Company A had developed its brand equity from the start it will be much easier to leverage this position to sell Product B when the time comes.
You need to consider how your portfolio of brands will grow over time. Will this be managed through extension of an existing brand, or the introduction of new brands moving forward? Your overarching brand identity is key to success. If your intention is to leverage this customer group and interact at a master brand level or new product brand then you need to have a communication strategy that includes both brands. This strategy will include how and when each brand is used, whether they are used together or in isolation.
Understanding your brand identity and its value proposition carefully will help you to decide if your brand can be leveraged for particular products and services as they are introduced. Changing meaning is difficult once an existing brand has become established. The more distinctive each customer group’s character is the more likely you may consider more distinctive brands to satisfy them.
If your product brand is extendable in its own right then it may evolve to become a master brand capable of spawning a set of sub brands. For example, consider the New Zealand company, Xero. Its flagship accounting as a service product of the same name "Xero", provides the core functionality for small businesses to easily manage their accounting needs online. Already many third parties are leveraging this platform to offer these customers extended modules and other functionality. Xero has extended into payroll and I am sure more is on its way. Over time the brand "Xero" will change in meaning from an online accounting solution to an online small business suite of solutions. In action you could imagine that the word "Xero" individuates the brand, provides personality, meaning and identity. The category descriptor such as "Payroll", "HR", and “CRM" becomes the describer and sub brand. So we end up with Xero CRM. In this case the brand architecture is what started as a company/product brand evolves to become a brand platform.
I have seen companies who have cut off valuable relationships with customers because they have overdeveloped product brands and under developed umbrella brands. This problem comes about because no one recognised that the master brand would ultimately become an umbrella brand in the first place. Asking the tough questions now and holding brand managers accountable is key if your master brand is going to make it on the front line.
Consider your brand elasticity. The All Blacks brand for example no longer is used for one team but rather a group of teams at the highest level from New Zealand. This conflicts with the value proposition of a high performance, legendary team because these other teams lose more often than the original All Blacks. Is this an issue? In the short term no, because people still realise that the original All Blacks are one team. In the long term yes, because the brand equity in the All Blacks brand will be stretched and eroded over time because the new brand values conflict with the old. It cannot occupy two places in the minds of consumers at once so something has to give.
Ultimately we need to be building brand equity at the master in addition to the product level if we intend to operate outside of the product level in the future. Apple for example, achieved long-term success with its clear brand architecture. It clearly and carefully builds brand equity and intimacy with customers at a master brand level by introducing products that consumers love.
How you execute your brand strategy will depend on specific circumstances and the media being used. A distinctive brand portfolio can lower risk and insulate the master brand from mistakes and business failure. The downside when every brand is distinctive is that no one shares and leverages a common brand equity. The upside being flexibility. When one brand fails or needs to be moved on it feels as if it exists in its own right and can be moved or eliminated without affecting the whole. Bear in mind that the more distinctive brands you have, the more cost you will need to consider to maintain them. Reaching customers takes time and effort. This alone can encourage business managers to do more with a single master brand.
Managing multiple brands? Let me know if you would like some help planning your brand identity...Hayden BreeseCEO & Relationships