A framework for brand revitalization through an upscale line extension
Shantini Munthree and Geoff Bick
University of the Witwatersrand, Wits, South Africa, and
Russell Abratt
Nova Southeastern University, Fort Lauderdale, Florida, USA and University of the Witwatersrand, Johannesburg, South Africa
Abstract
Purpose – The objective of the paper is to provide an understanding of how large organisations develop line extensions of their brands and to present guidelines for management when considering an upscale line extension.
Design/methodology/approach – A qualitative research technique was used in this study. It involved case study research in the beverage industry, where 11 senior marketers were interviewed in depth.
Findings –
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Two strategies to revitalise a brand are:
1 to reposition the brand; and
2 to introduce line extensions that follow business and market shifts (either downscale value segments or upscale premium segments) (Aaker, 1997; Blasberg and
Vishwanath, 2003).
The current issue and full text archive of this journal is available at www.emeraldinsight.com/1061-0421.htm Journal of Product & Brand Management
15/3 (2006) 157–167 q Emerald Group Publishing Limited [ISSN 1061-0421]
[DOI 10.1108/10610420610668595]
157
Extending a brand
There are three types of relationships between a core brand and its line extension (Aaker, 1997). One scenario is when the core brand acts as an endorser of the line extension (Aaker,
1997). An example here is Mentadent P Herbal as the dominant line extension that is endorsed by Mentadent P, the core brand. In the second scenario, the core brand and line extension are co-drivers that exert equal influence on the consumer, such as VW Passat or VW Golf. In the third scenario the core brand is a driver, and the line extension acts as the descriptor – “a word or phrase that tells the consumers that the company is offering a slight variation to the product they have come to know” (Aaker, 1997 p. 138). An example here is “Coke” as the core brand and “Vanilla” as the descriptor in Coke Vanilla.
Upscale brand extensions
A study by Silverstein and Fiske
Catherine, W., Tat Pui, L. and Henrik, U. (2011) The Roles of Branding for a Brand Entering
Brand competitors and the diversity of choice that is available to consumers, puts brands under pressure to offer high quality products and service, excellent value and a wide availability (Clifton et al., 2009). Brands must differentiate themselves from the competition and create an unforgettable impression.
In determining whether or not a brand extension will be successful, corporations and marketing strategists must attempt to build strong correlations between the existing brand and/or product line. A strong pairing or high-fit brand extension immediately associates a new line or extension with currently held views of consumers. The more dissimilar a new product
First of all, a strong brand can be seen as the condition for organisations to expand products, offer more service, and introduce new products (Chernatony and McDonald, 2003). Secondly, a strong brand can lead to growth marketing communication effectiveness (Keller, 2009). ‘To build a strong brand, the right knowledge structures must exist in the minds of actual or prospective customers so that they respond positively to marketing activities and programs in these different ways.’(Keller, 2003, p. 140) Furthermore, Kay (2005) asserted that the strong brand can be seen as a resource of management, which make brand extension easier and useful to build distribution network. Companies are not treated by the intermediaries (Chernatony and McDonald, 2003). Moreover, companies are comparatively easier to change price if they have strong brands. As Henderson, et al (2003) said, a strong brand can allow for premium pricing even still remain loyalty customers, which help companies to survive in the intensive competitive market.
In today’s world there are constant changes that are difficult to keep up. People struggle for this reason as well on daily basis. This type of issues has come to the attention of the management from different companies around the world, the competitive environment and government policies have affected many other industries as well. Consequently, they feel that similar changes may be applicable in their food and beverage industry. There are new companies entering to the market which have to overcome some issues such as mergers, globalization, the price set up, and the sustainability of profits. It is
For brands to remain in today’s market place, they need to offer a more competitive added value in their products to cope with this shift of power from the brand to the consumer. (Toffler, 1980)
The economic base over the past fifty years has undergone a major shift from being production centric to consumption centric as consumers have made a transition from the sphere of rationality to the realm of desire and wants. This shift has contributed significantly towards the birth of an economy driven by people, making it resoundingly lucid that customers are now in the seat of power, compelling industries to treat ‘customers as king’ by offering them their desired products at the demanded place and time. In such markets where industries are producing homogenous products and competing against each other to satisfy the needs of ever demanding customers, branding plays an imperative role (Lafferty B,2001). It is branding that provides companies the competitive advantage by contributing towards image creation, creating differentiation and customer recognition thereby highlighting that branding in present day is paramount (Shipley D; Howard P ,1993)
A marketing audit is not unlike a financial audit in that it helps the organisations to examine progress or lack of process towards the goals.
Brand recognition and strategy was a struggle during the first year. Global Imports purchased market judgment to gauge how well the products were selling, and to see if they were meeting consumer needs. Unfortunately, we had to rebrand the workhorse and innovators product line, as they did not sell very well during the first year. However, as the second year approached we found that in comparison to the other competition that was meeting product needs for workhorse and innovators we could boost sales and revenue. Even though we rebranded, we found that introducing another product would also increase sales and possibly increase sales in other areas as well. As an end result the workhorse and innovators brands actually did become profitable. Whereas, the diverse line cost more money to produce than anticipated. Furthermore, then one thing that hurt the firm in the last stages was the firm did not purchase the market judgment to
A brand serves to add dimensions to a product to differentiate it in some way from other products designed to satisfy the same needs. The strength of brands is measured by the price differential that consumers are willing to pay over other products in the same category (Keller, 2012). For many young people, it is not buying a pair of jeans, but buying GAP or Tommy Hilfiger or Levis. As per the article in Business Week (Wechsler, 1997, p. 64) this “barrages of brand names offers the irresistible promise of instant cool.”
Priority of internal growth, sustained by innovation, quality and controlled distribution. Guarantee brands’ autonomy in accordance with their own indentity. Share skills and experiences of each brand and implement synergies. Set up and develop teams of excellence.
This consulting paper aims to focus on the challenges of Procter & Gamble in the area of brand management. The topic of brand management is an important aspect of multi-national companies like Procter & Gamble especially in the area of consumer goods. The tasks being encountered by consumer goods companies like Procter & Gamble present the highly complicated business environment characterized by increased global competition, the need to diversify products, and the pressure to reduce cost while maintaining brand quality (Haas, McGurk, and Mihas, “A new world for brand managers”). These business elements are important indicators that must be addressed by Procter & Gamble in order to maintain their market edge and competitiveness especially in an immensely globalized economy and great competition in the area of consumer goods. The paper’s objective is to identify the various possible issues and challenges that can impact Procter & Gamble’s marketing efficiency specifically in the area of brand management.
You have to continue with what you believe in and strongly. Big brands are subject to large layers of bureaucracy, which prevents them from being flexible in meeting the needs of customers continuously. This class of decision-makers can be the hardest for you, Also don't repeat the same message in the same way over and over again, so be creative in communicating the message in different ways and a sudden decision-making.
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