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Brand Management

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Brand Management (MKT624)
VU
Lesson 6
STRATEGIC BRAND MANAGEMENT
Mission
A mission statement speaks of the present form of business, the products it is dealing in, the
customers it is serving, and the areas in which it is operating etc. In other words, a mission is all
about achievement of present objectives.
It also talks of the commitments and values that are needed to let the company achieve its
objectives. It does not speak beyond that. But, the process of strategic management does not
stop there. It makes it imperative that managers see beyond the mission, or the present, to
determine a long-term direction that the company must take for tomorrow. Nothing is static.
The dynamism of the market necessitates that managers must see the impact of:
·  changing technologies
·  changing lifestyles
·  changing needs of customers
·  changing benchmarks of quality, and
·  changing competition and overall conditions
They have to make some fundamental choices about where they want to take the company and
how that evolution and transformation will take place. Such choices form their vision of the
company and supplement present company mission with factors like
·  future business makeup
·  product line, and
·  customer base
These factors form the foundation for brands and branding. They are closely intertwined and
lead you to form the right branding strategies. It is from that point of view that brand managers
must understand the subtleties of the vision and the mission of the company.
In case a company's mission statement talks not only about its present, but also future, then the
mission merges into the strategic vision and we can say the mission is future-oriented. Mostly
company mission statements are more concerned about their present business than their future
one.
The conceptual distinction between vision and mission, therefore, remains relevant. A clear
vision of future business and strategic direction is a prerequisite to strategic leadership. It steers
the whole company toward the desired destination.
Nothing could direct the company better toward that destination than having good strategic
leadership. And, nothing could give brand managers better insights into developing brands that
really fit into the strategic vision of the top management.
Setting Objectives
After vision and mission are in place, the next step is converting those statements into specific
objectives. Performance of all managers is measured by the level of achievement of those
objectives.
Any organization setting itself ambitious and bold objectives become aggressive in its pursuits.
Ambitious and bold should not be misinterpreted as unrealistic. Organizational capabilities
must be considered before setting realistic objectives.
Targets
Toward achievement of objectives, all managers across the company must get targets
that can be measured. Targets broken into divisions, departments, and then units
develop a result oriented work culture. It improves work performance with no confusion
about who is supposed to do what and who is stepping on whose toes!
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Brand Management (MKT624)
VU
The collective achievement of targets helps the company to achieve its mission and
assure fulfilling its vision.
Types of Objectives
Following are the two major types of objectives set in a typical organization1
·  Financial Objectives
·  Strategic Objectives
Financial Objectives deal with
·  Revenue growth
·  Earnings growth
·  Return on investment
·  Dividend growth
·  Share value appreciation, and
·  Positive cash flow etc.
Strategic objectives deal with
·  Winning greater market share
·  Overtaking competitors on quality
·  Staging innovations
·  Cutting costs
·  Creating and sustaining technological leadership, and
·  Capturing growth opportunities etc.
Both financial and strategic objectives are set in short and long term basis. The job of managers
is to achieve both in order to improve competitive strength of the company. While short range
objectives keep the managers involved in accomplishing the mission, long range objectives
prompt them to think what to do next to achieve company's vision.
Crafting a Strategy
Strategy is crafted in compatibility with the stated objectives. Objectives are the "ends" and
strategy is the "means" to achieve those ends. Strategy deals with "whether to" and "how to"
areas of the management process and seeks answers to the following kind of "whether to" and
"how to" questions.
·  Whether to concentrate on one business or diversify?
·  Whether to serve a large number of customers or operate in a niche?
·  Whether to have a narrow product line or a wide one?
·  Whether to achieve competitive advantage through lower costs, better quality, or unique
features?
·  How to respond to competitive pressures?
·  How to respond to changing preferences?
·  How big a geographic market should be?
·  How to grow the organization in the long run?
The "whether to" and "how to" aspects relate to branding strategies as much as they do to
overall business. If you come to think of it, many of the questions fall within the area of brand
management.
Implementing Strategy
The fundamental is to assure "what are and should be" the means at management's disposal to
achieve what is envisaged. Implementation is all about what must be done to achieve the
desired performance goals by putting strategy at work.
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Brand Management (MKT624)
VU
Proficient execution consists of the following key aspects
·  Building an organization and developing a culture of motivating people by instituting
reward systems.
·  Developing budgets and steering resources into strategy critical areas of success.
·  Installing information and operating systems.
Evaluating Performance
What has been set as objectives and targets have got to be evaluated to see if management is
really moving along the path it envisioned for itself! Movement identical with the planned path
is generally not possible. If performance is above par, then it is not bad. If not, then the
following questions have to be considered:
·  Change of strategic direction
·  Business to be redefined
·  Vision changed; narrowed or broadened or revised altogether
·  Performance standards to be lowered or raised
It is clear that all the above considerations relate modifications and adjustments in the strategic
frame work.
The Brand Vision
An understanding of the strategic management process makes it amply clear that a company
cannot carve its future path without accounting for its brand(s). Brands lay the foundation for
fulfillment of the vision and they also serve as the keystones for sustaining that fulfillment.
If brands help the company achieve its strategic and financial goals, then a brand vision must
flow out of the company vision. The overall vision must specify the way the management looks
at the brand future in the long run.
Brand future refers to
·
markets and market segments to be served
·
quality improvements to be achieved
·
envisioned changes to be met
·
investments to be made, and any other factors that address brand movement in times to
come
The Brand Mission
Clarity of vision leads management to state the mission, that is
·  What customers the company serves?
·  Why it serves?
·  What geographical areas it serves?
·  What benefits it provides?
·  What kind of results it envisages to achieve:
o Sales
o Profits
o Market share
Values
Values are a set of virtues employees should share. Those are described as2
·  integrity
·  trust
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Brand Management (MKT624)
VU
·  honesty
·  commitment to quality, and teamwork etc
The vision and the mission for the brand are embedded in the values a company has and
cherishes. The conduct of a company in relation to the market and all stakeholders is a
reflection of the values the company harbors. You must have heard about Japanese work ethics
having deep roots into the Japanese cultural values. All their businesses, therefore, are an
evidence of those values in the form of good quality products.
It has been observed that companies that explicitly state their vision, mission, and values to
uphold what they want to achieve in the short and the long run are successful in
·  Having high market shares
·  Good profitability
·  Good level of leadership
And, hence, succeed in fulfilling their mission and vision.
Why brand vision?
Scot Davis makes a statement that not many companies go by the process of having a vision2.
Such companies are committed to brands but leave much to be desired, he maintains.
Subsequently, they keep changing strategies, as desperate moves, from time to time with the
result that the brand never gets the desired support.
Lack of proper support could be
·  Less market investment
·  Less manufacturing investment
·  Less human resource investment
The net result is that the company cannot fulfill what could have been the right vision and
mission, a sure indication that it is not upholding what should have been the right values. You
may like to relate this with brand future discussed above and then develop linkages between the
two.
Summary
Vision relates the future; mission is all about the present. The strategic management process
starts with a company having a vision about where it wants to reach in foreseeable future. The
vision is then transferred into the mission of the company, which essentially is the company's
ability to reach for the immediate goals relating the present and immediate short-term period.
Strategies are the game plans companies need to have to defend themselves against the ever-
present hostile competition. The defensive mechanism is translated in terms of different
strategies to accomplish the mission and lay ground for fulfillment of the vision. It needs to be
clarified that offensive strategies, at times, provide the companies with the best defense, lest
you misunderstand that strategies are always defensive.
The company vision leads to brand vision and mission. Coupled with good values on part of all
employees, companies move to accomplish their missions and fulfill their visions.
Since brand vision rolls out of the overall company vision, it is of high significance to learn
how it happens and why there are tremendous consistencies between the two.
Bibliography:
1. Thompson Strickland: "Strategic Management - Concepts and Cases"; McGraw Hill (37)
2. Scot M. Davis: "Brand Asset Management ­ Driving Profitable Growth through Your
Brands"; Jossey-Bass, A Wiley Imprint (38)
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Table of Contents:
  1. UNDERSTANDING BRANDS – INTRODUCTION:Functions of Brand Management, Sales forecast, Brand plan
  2. INTRODUCTION:Brand Value and Power, Generate Profits and Build Brand Equity
  3. BRAND MANIFESTATIONS/ FUNDAMENTALS:Brand identity, Communication, Differentiation
  4. BRAND MANIFESTATIONS/ FUNDAMENTALS:Layers/levels of brands, Commitment of top management
  5. BRAND CHALLENGES:Consumer Revolt, Media Cost and Fragmentation, Vision
  6. STRATEGIC BRAND MANAGEMENT:Setting Objectives, Crafting a Strategy, The Brand Mission
  7. BRAND VISION:Consensus among management, Vision Statement of a Fast Food Company, Glossary of terms
  8. BUILDING BRAND VISION:Seek senior management’s input, Determine the financial contribution gap
  9. BUILDING BRAND VISION:Collect industry data and create a brand vision starter, BRAND PICTURE,
  10. BRAND PICTURE:Brand Value Pyramid, Importance of being at pinnacle, From pinnacle to bottom
  11. BRAND PERSONA:Need-based segmentation research, Personality traits through research
  12. BRAND CONTRACT:The need to stay contemporary, Summary
  13. BRAND CONTRACT:How to create a brand contract?, Brand contract principles, Understand customers’ perspective
  14. BRAND CONTRACT:Translate into standards, Fulfill Good Promises, Uncover Bad Promises
  15. BRAND BASED CUSTOMER MODEL:Identify your competitors, Compare your brand with competition
  16. BRAND BASED CUSTOMER MODEL:POSITIONING, Product era, Image Era, An important factor
  17. POSITIONING:Strong Positioning, Understanding of components through an example
  18. POSITIONING:Clarity about target market, Clarity about point of difference
  19. POSITIONING – GUIDING PRINCIPLES:Uniqueness, Credibility, Fit
  20. POSITIONING – GUIDING PRINCIPLES:Communicating the actual positioning, Evaluation criteria, Coining the message
  21. BRAND EXTENSION:Leveraging, Leveraging, Line Extension in detail, Positive side of line extension
  22. LINE EXTENSION:Reaction to negative side of extensions, Immediate actions for better managing line extensions
  23. BRAND EXTENSION/ DIVERSIFICATION:Why extend/diversify the brand,
  24. POSITIONING – THE BASE OF EXTENSION:Extending your target market, Consistency with brand vision
  25. DEVELOPING THE MODEL OF BRAND EXTENSION:Limitations, Multi-brand portfolio, The question of portfolio size
  26. BRAND PORTFOLIO:Segment variance, Constraints, Developing the model – multi-brand portfolio
  27. BRAND ARCHITECTURE:Branding strategies, Drawbacks of the product brand strategy, The umbrella brand strategy
  28. BRAND ARCHITECTURE:Source brand strategy, Endorsing brand strategy, What strategy to choose?
  29. CHANNELS OF DISTRIBUTION:Components of channel performance, Value thru product benefits
  30. CREATING VALUE:Value thru cost-efficiency, Members’ relationship with brand, Power defined
  31. CO BRANDING:Bundling, Forms of communications, Advertising and Promotions
  32. CUSTOMER RESPONSE HIERARCHY:Brand-based strategy, Methods of appropriations
  33. ADVERTISING:Developing advertising, Major responsibilities
  34. ADVERTISING:Message Frequency and Customer Awareness, Message Reinforcement
  35. SALES PROMOTIONS:Involvement of sales staff, Effects of promotions, Duration should be short
  36. OTHER COMMUNICATION TOOLS:Public relations, Event marketing, Foundations of one-to-one relationship
  37. PRICING:Strong umbrella lets you charge premium, Factors that drive loyalty
  38. PRICING:Market-based pricing, Cost-based pricing
  39. RETURN ON BRAND INVESTMENT – ROBI:Brand dynamics, On the relevance dimension
  40. BRAND DYNAMICS:On the dimension of knowledge, The importance of measures
  41. BRAND – BASED ORGANIZATION:Benefits, Not just marketing but whole culture, Tools to effective communication
  42. SERVICE BRANDS:The difference, Hard side of service selling, Solutions
  43. BRAND PLANNING:Corporate strategy and brands, Brand chartering, Brand planning process
  44. BRAND PLANNING PROCESS:Driver for change (continued), Brand analysis
  45. BRAND PLAN:Objectives, Need, Source of volume, Media strategy, Management strategy