|An optimal brand architecture can be created through the evaluation of six critical brand characteristics.
Most companies own multiple brands, and while this has undoubted advantages, there are also pitfalls that come with the territory. The use of metrics to help measure, manage and model brand architecture outcomes can be a valuable tool in optimising the use of brand portfolios.
It is increasingly common for companies to own portfolios of brands, even in the same category. This approach has the obvious advantages of increasing market share, maximising appeal to consumers, enhancing bargaining power with retailers and blocking potential positioning to competitors.
However, there are also a number of problems that come with portfolios – in particular, cannibalisation of your own sales, complexities in production, ensuring discrete positionings and allocating marketing investment.
The key issue out of all this, whatever the starting point, is to identify the future brand architecture scenario that delivers the most value to the client's business. It is very rare that the number of brands owned by a company remains static -either it increases (brand divergence) or it decreases (brand convergence).
The most common question asked by marketers is: "Do I introduce a new brand?" While launching a new brand is exciting from a marketing perspective, it may not be the right answer for the business.
Brand divergence is most often seen in higher-growth, less mature categories, where new brands hold the promise of capturing growth and attracting specific consumer segments. Typical examples abound in restaurants and food-based pubs, hotels and airlines.
A highly successful British regional brewer, Greene King, has a portfolio of retail businesses including Loch Fyne restaurants, Old English Inns, Hungry Horse pubs and Hardy's House pubs, which are intended to suit different going out occasions, different consumer segments, and different price points.
An increasingly common question is: how do I move from many to fewer brands?
But it remains a problem... wherein novelty and variety are key to retaining consumer loyalty, and it is virtually impossible to build a market-leading share without a large portfolio of brands.
||Equally, there are the famous cases of 'less is more'.
To answer these complex, yet perennial questions, there are a number of approaches that can be invoked to help, which involve six hard and fast metrics.
1. BRAND STRENGTH
2. BRAND FIT
3. BRAND STRETCH
4. BRAND INVESTMENT
5. BRAND POSITIONING
6. BRAND FINANCIAL PERFORMANCE
The employment of some or all of the above metrics enables clients to determine predictive metrics around future-facing brand architectures, and thus identify the optimal solution.
The final choice rests on the strategic direction - for instance, whether it is to defend a market or expand it, and the degree of risk that is acceptable in order to achieve a given opportunity.
In addition, it depends partly on what competitor reactions are likely to be.
In any event, when it comes to the vexed question of creating an optimal brand architecture, there are plenty of predictive metrics that can be used to help with finding that elusive right answer.