Branding in International Marketing Chapter I

The Brand’s Position and Dimensions

1. The Importance of the Brand

1.

The Components of the Brand

2.

The Legal Protection of Brands

4. The Relevance of Corporate Identity when Considering the Brand

1

The Brand’ s Position and Dimensions In the era of globalization the world people live in becomes more and more complex, so that the individuals need to find easier ways to guide them through this world. These days, from the point of view of the consumers, they choose the most trustworthy symbols they encounter on their way, most of the times, in order to save time. The trend that we are facing today determined marketing specialists to conceive customer-oriented strategies. Business practices focus a lot upon the satisfaction of customers. The most important means of communication between the producer and the consumer, the main type of connection for the two sides, is the brand.

1. The Importance of the Brand Surveys were made in the UK, which showed that most of the times people trust brand names more than the Police or the legal system. So, one can say that the relationship between consumers and successful brands is extremely relevant. A successful brand is a well-known product, service, person or place presented on the market in such a way that the user or buyer finds it to be relevant or unique. Brands are used both for products and services and can even be associated with people such as actors, singers or places, for example the marketing used for building up tourism attractions. Brands may belong also to the non-profit organizations, most frequently in the cases of the international ones such as the Red Cross or the Greenpeace. The success of a brand depends mostly on the clearness of its statement of intent. A clear-targeted social group and the achievement of the main purpose which is to satisfy and exceed the consumer’s needs are the main things which stand at the basis of the success of a brand. Just like a person, a brand has a character, values and a look that make it truly unique and different from others. It’s that point of difference that provides the customers of a company with a reason to choose their brand over the alternatives; and it’s the strength of the brand that will then determine the length of that relationship.

2

Consumers have needs both at the rational and the emotional level, needs which are covered by the benefits delivered by brands. Successful brands are those which have the correct balance in terms of their ability to satisfy the rational and emotional needs. As an example, the consumers of ice-cream have a variety of rational needs such as the taste, the quality, the packaging or the price. Besides these rational needs, they also seek to satisfy emotional needs such as, in the case of the icecream, the childhood nostalgia of a summer afternoon walking with their grandfather on the beach. According to all these sorts of needs, marketers must find ways in which their brand satisfies their rational and emotional needs and then develop marketing programs accordingly1 .
1

Therefore, the brand is the one which creates awareness of the product or service and which differentiates it from the other competitors. It uses names, labels, signs, symbols, designs and colors in order to identify the goods or the services of one seller and to differentiate them from those of the others’ players on the market. Coca Cola’s red-and-white bottles, Disney’s familiar script and the golden arches of McDonald’s are all elements of these popular brands, that also give them a distinctive identity. Different companies have different approaches to brands. Some focus on building a single brand- American Express or Amazon.com- while others divide their efforts between the parent company brand and the individual products2. As a process, branding is a very complex one. It stands for the creation and the development of a specific identity of a company, product, commodity, group or person. Branding is the creation and development of the identity of a product and it is the result of the work of different professionals who most of the times belong to the following categories- advertising , marketing, and public relations. Advertising helps the product to become well- known to its targeted public and the look and the attitude which are used help the defining of the brand in the public’s mind.Marketing helps to create the entity that the brand will become and public relations helps solidify the public opinion of the brand and defines it.

Advertising
1

Levine, M. (2003), A Branded World: Adventures in Public Relations and the Creation of Superbrands, New York: Wiley, p. 25. Chernatony, L. and McDonald M. (2003), Creating Powerful Brands, Heinemann, p. 22-26.

2

3

smart and easy to use. Although it has very high sales. A good advertising account executive is always involved in the birth of a brand. A new product was to be released. The new product looked different than all the other ones on the marketvery colorful. Mc Donald’s still promotes its products through well known advertising campaigns all over the world. a real change from the beige boxes in all the computer industry. as do the choice of publications in which print ads will run. People believe that the iMac was innovative marketing choices made were the correct ones. Apple increased its market share and sold millions of iMacs . Apple Computer experienced some sales difficulties. along with the other specialists. Nike is even a better example of spending large amounts of money for advertising. Advertising does not create the identity. very quickly. Television commercials emphasized the look of the computer and the ease with which it could be installed and connected to the Internet. It marketed that Apple was something new. Marketing is the one which establishes what the image of a product should be like. For example.loud music may work for a soft drink ad. something fun. What the company did was to analyze the strong points of Apple and the imam. and exciting because the 4 . The personality of the product had to be very importantloyal Apple users had to be reminded why they liked the computer in the beginning and new users had to be convinced to try something that would look different fro what that they had tried before. the programs during which the ad can be seen. Marketing executives made sure that the Imax was something innovative. As a result. The iMac campaign was successful with consumers because the market executives involved had correctly defined its demographic target. a few years ago. but it chooses how to present the identity.the imam Computer. but it won’t be good for a detergent ad. Based on the targeted audience of the product. very appropriate for the younger users.Even the most successful brands need to advertise in today’s business climate. makes a statement about the personality of the product. The way a television or print ad look is extremely important. For example the sound will change with the kind of brand being presented. marketing will determine which aspects one segment of the population will find appealing. Besides these aspects. When the brand is new it is important that the target audience is able to identify easily the brand and identify with the brand. The company is always spending millions on the appearance of celebrities in its commercials which are considered to be legendary.

Marketing determines how the product is perceived by the public and it is best and the easiest done when the product is being marketed is of high quality.The success is due to market research; through focus groups, surveys and other tools market research determines what people want. Marketing is more the art of taking what already exists and making it more attractive to the public through branding techniques. The public relations in branding has a more subtle role than the previous activities mentioned. Once marketing executives decide on the identity of the product, and once the advertising team has created a message to deliver it directly to the public, PR managers are responsible for the messages the public gets through different channels of communication. For example, in the case of iMac, Apple made sure that school systems around the country had iMac computers as soon as they were available. Quite often they made donations to the schools. This helped familiarize very young computer users with Apple’s product first. This brilliant public relations showed that Apple had strong interests in education and in helping children, positive messages transmitted to the consumer. Before bringing the brand into the newspapers, the radio programs and television programs, the public relations professionals have to analyze the brand identity. The characteristics found by the marketing team – the target, especially- will help also the public relations specialists in order to guide the message transmitted3. In conclusion, PR is the art of telling the story of a unique selling proposition, emphasizing its positive aspects; it helps create a brand, establish it and develop it. A successful brand has both a strong personality and friendliness; it seems to come along effortlessly, when in fact it is the product of endless market research studies, work and dedication.

2. The Components of the Brand

3

Levine, M. (2003), A Branded World: Adventures in Public Relations and the Creation of Superbrands, New York: Wiley, p.30-34.

5

The value of the brand is directly related to all the concepts involved in the structure of the brand, expressing the brand’s personality. The message a brand drives must be a concentrated, succinct and powerful one, so that the impact while communicating the essence of the brand through different media channels remains positive. Revitalizing the elements of a brand once in a while helps a repositioning in the marketplace and conquering a new level of brand development. Brand Components: • • • • • Brand Personality Brand Theme Brand Narrative Brand Experience Brand Name

The brand personality is the characteristic of a brand that best communicates the proposition of the brand to the chosen target of audience. The emphasis is laid not on the personality of the target audience, but on the type of personality that is most likely to draw their attention and encourage them to take initiative and buy the brand. One brand personality will appeal to a different target of audience from the other, but all of them are based on the same principles of brand proposition. The brand personality turns the brand into a character or a person, as this is the best way for the consumers to be reached at. The most frequently met vast type of experience that people have is that dealing with human relationships. This makes possible the ability of people to notice between subtle differences in brand personalities and build up loyal or non-loyal relationships with them. Most of the times brand personalities are characterized in relationship with other people, services or objects: “If brand X were a car, what kind of car would it be?”, “If brand Y were a person, what set of clothes would they wear? What would they drink? Where would they go on holiday?”. This role-play is a very helpful exercise for brand managers in order for them to understand how their brand will behave after releasing it and what is the kind of relationships it will establish with

6

different kinds of consumer groups. This type of mental model is very useful when thinking about possible crisis along the life of a brand. The model offers a set of physical, emotional and intellectual dimensions which all help to make decisions about the health and the direction of the brand. Once a brand manager is able to achieve this level of knowing the brand , it is possible to define how the brand will grow, react to negative and positive changes on the market and protect it against tactical brand attacks from competition. The Brand Theme A brand theme is the concept that unifies all the elements of the brand that can be connected. Successful brands can develop all types of dimensions inside the same brand theme. The whisky Glenfissich developed a strong brand personality whose theme is the Highlands of Scotland. This theme is very rich to build the brand personality on it, because the Scottish theme has a large variety of cultural elements that can be used. One of the themes with great impact would be the natural beauty of the Highlands- the bright colors of forests in autumn, the majesty of the snow- covered mountains in the winter, or the fresh mountain air and water that can almost be tasted and felt. Another appropriate theme is that of the craftsmen. They are involved in whisky making through a narrative of hand-made fishing flies and shooting gear; by this they show attention to detail and the patience of the maker.

The Brand Narrative The personality of a successful brand enriches in time; even if there remains a central constant brand proposition, its expression may change in time in order to remain competitive in the business environment. The brand narrative is the story that a brand personality follows until the end of its existence. Some brands rely on the narrative of their founder such as Bill Gates of Microsoft. Other brands choose fictious families or characters.

7

creating the sense of loyalty to the brand.This technique helps to have a forward or backward perspective. First of all it identifies the company or the product as being unique to the consumer. The brand name should also take into account the long term objectives of the brand and all the aspects of its personality. regardless of the tangible company assets. It should be so powerful so that it protects the product from its competitors and offers a clear position of the business in the minds of the consumers. because it places the consumer at the center of the event. The brand name has several functions. Then. Because in many cases the brand name of the company values even more than its assets. Brand Experience The perfect way to generate a successful brand personality is when all its elements combine to create a total brand experience. This experience represents a moment that only one brand can provide or fulfill. The interaction of time and space in creating this memory is very important. 8 . The secret to defining successful brand experiences is to create a story that will satisfy the consumer’s desires in his/ her every day life. It does change only in times of mergers or of acquisitions. and it should be traded. it should be easy to pronounce.backward with a nostalgic feeling and forward with an optimistic feeling. Through this process the consumer arrives at the point where he or she associates specific events in their lives with the expressions of the brand of that time. the name should be chosen with great care. so that they have all the chances to remember this experience for a long time. While all the other elements of the brand change over time. The Brand Name The most visible element of the brand is its name. in a specific time and in a specific place. it should crystallize the experience of the brand in a single word or phrase. It should be protected and used to create a legal barrier to counterfeiting. spell and it should be usable all around the world. the name does not.

The Essential Brand Book. according to some authors4. Kogan Page Ltd. Article Naming of a Brand. The most common decision is that a name should explain to the world what business the company is in or what your product does.. Virgin Airlines • • • Says "we're new at this" Public wants airlines to be experienced. When Jeff Bezos founded Amazon.An important first step when naming a business. and since it was one of the first such companies. on the product itself. (2002). A descriptive naming strategy doesn’t take into consideration the fact that sometimes. a storefront. Jeff Bezos knew that someday his company might want to sell more than just books. a thorough competitive analysis. some of the names below could not have ever seen the light of the day5. and that someday it might even have an offline. www. It actually works against you. not just online presence. so that everybody knows what the business is about. in advertisements. in a conversation. or. A naming project must take reference of the context of a clear positioning platform. Having a descriptive name is actually a counterproductive marketing move which requires an enormous amount of effort to overcome. it was billed as an "online bookstore" just like all of the above. The name will appear on a website. at its most naked. 9 . product or service is to figure out just what it is that the new name should be doing for the business. p. the whole point of marketing is to separate the product from the pack.com.allaboutbranding. The notion of describing your business in the name assumes that the name will exist at some point without contextual support. when you think about it. is impossible. If not considering all these elements. 136-143. on a business card. there was even more reason to go with a descriptive name. and an profound understanding of how names work and what they can do. in a news article or press release. causing you to fade into the background. safe and professional Investors won’t take us seriously 4 Elwood. I. 5 Manning. S. which actually turns out not to be true. indistinguishable from the bulk of your competitors. which. Intuition brings out that this will save you the time and money of explanation. (2004).

It must be consistent with the brand identity and it may evolve over time as the brand is expanded or extended. As they begin to evolve. the name of the brand. logos represent conceptual ideas and exist as business cards. When first created. and attributes that are associated with a positive emotion . Packaging is the visual representation of the brand. and symbols on proposal covers.that identifies a logo as a service offering in the mind of the 10 . the material from which the package is made and any visual image that represents the brand in the consumer’s mind.• Religious people will be offended Yahoo!! It's Mountain Dew! Yahoo! It’s a chocolate drink in a can! Nobody will take stock quotes and world news seriously from a bunch of "Yahoos" Yahoo! • • • Oracle Unreliable Only foretold death and destruction Only fools put their faith in an Oracle The Gap • • • • • • • • Means something is missing The Generation Gap is a bad thing . It includes the brand logo. but it is the presentation of the product or service that represents the brand. the type of lettering on the box.wanting to sell clothes to all generations In need of repair Incomplete Negative Packaging By packaging one doesn’t mean the box. letterhead. company values. bag or the container in which a product is sold. they can grow into the sum of the corporate vision and symbolize the value proposition. characteristics.

mtv. The color in IBM’s case symbolizes the stable . In conclusion. Color is a very important element of packaging as it relates to 11 . There has never been one official design for the MTV emblem. but its design. it proves that it isn’t necessary to follow the rules to succeed. but there’s no one to address the company Apple with “ The big rainbow”. Such as the MTV brand. A strong and communicative logo eliminates obstacles in the consumer’s mind and simplifies the way a consumer thinks of the brand. This example is very much similar to the previous one. while blue refers strictly to design elements. Immediately recognizable. it is only necessary to be true to your brand. The most immediately striking visual element of the packaging is the color. Apple doesn’t always use the rainbow colors. The IBM logo is often referred to as the Big Blue.uk This is another example of transforming the laws of branding in according to what the branding team feels its best for the company. In fact the distinctive thing about the MTV logo is that it is always different. This logo is a distinct and clear statement of the brand identity. The shape of the MTV logo – the huge outlined M with the small “TV” in the lower right corner. mainly the company logo. It is the first thing that registers in the consumer’s mind and first impressions are the most important ones in branding. In the case of Apple. the colors are less important as a design element than the colors of IBM . instead using the logo’s immediately recognizable shape to symbolize the company in many print and television advertisements and on packaging. The other thing MTV’s changing logo did was to define the attitude and the brand identity that MTV would offer its consumers. Figure 1 The MTV Logo Source: www. color and even print font can change from moment to moment. the symbol of Music television was almost impossible to avoid during the eighties and nineties.“big” is a reference to IBM’s enormous success in its marketplace. dependable technology. even if this means turning the other way around all the rules.consumer. The Apple computer logo is made up of horizontal stripes of rainbow colors. that is IBM.Very few companies in our times choose the recipe for gaining success by constantly changing the logo of their products or services. the MTV logo has never been the same twice.remains over the time the same.co. The most well-known example is the logo of MTV.

This became particularly important when the goods were traded over large distances throughout Europe and the Middle East. strong emotion. 3. They communicate confidence. and the guild set the standards of quality. New York: Wiley. During medieval times. confirmed that the goods were genuine. From the earliest Roman times. Would IBM convey the same message with a hot pink rendering of its name? Probably not. The design would be palpable.Branding. orange. M. price and protocols for the workmanship. pink and other “hot” colors are used in packaging to convey a feeling of unpredictability. yellow. competence. friendliness. p. This created a monopoly on skills for each type of goods and often in each region. A Branded World: Adventures in Public Relations and the Creation of Superbrands. 12 . 79-84. Guilds were associations of craftsmen for a specific type of manufacture. Deciding on the proper color is a job for the design consultant and marketing executives. Only members of a guild were allowed to practice. green and brown are considered “cool” colors. another form of brand emerged that reflected the nature of commerce at that time. and warmth6. makers have marked their goods with a signature mark or brand to distinguish accurately the maker of the goods. almost three-dimensional. brass work and silversmithing. these were the guild marks. and at that point the logo or packaging should be well considered and aimed specifically at expressing the brand identity in no words or less. The Legal Protection of Brands History of the Trade Mark To understand the current position of the trade mark and its value to a brand identity we can trace it is growing importance in commerce. Red. and ensured that they were easily identifiable by the largely illiterate population. Besides drawing the eye to the product or the logo. (2003). color is another means of defining the brand identity. so that the consumer would feel the possibility of reaching out and touching the sign logo. akin to a silvery. gray. It served as a guarantee of ownership in the event of piracy. Although there was a provincial connection 6 Levine. through the easily identifiable guild mark or logo. like carpentry. pottery. and a stability. Would Apple Computer or Ben & Jerry’s command the same kind of consumer loyalty with plain gray renderings of corporate logos? Blue. metallic feel. Public relations gets involved in introducing packaging or changing them.

During this period the value of the trade mark shifted from what Pickering (1998) has described as a signal to a symbol. In both cases the primary task of the brand mark was to maintain and confirm the quality of the goods to the consumer. This has now become the basis of brands equity. and the increase in availability of goods. named producer. and as such 13 . allowing them to ask for a specific product by name. The Creation of Goodwill This concept of goodwill emphasizes the pre-purchase value of a trademark in the mind of consumers. The character of this goodwill was often embodied in the producer’s name. to a powerful symbol capable of multiple meanings to the consumer.between producer and consumer. unlike the Roman example. Consumers are the ones that build the brand identity from the mass of communication materials. With economic expansion. but they have embodied a set of values that the consumer can recognize and use to help choose between variety of goods.from a simple message to the consumer from the producer. This is important because it marks a change from the expression of the brand residing with the producer. products. The reliance on local stores to package and distribute goods was reduced as companies began to make and distribute their products nationally. The formal trade mark is the protected sign of a brand. The need to package individual portions of produce emerged. or the identification of a separate asset value of a trade mark. by directly linking it with a specific. Other trade marks have abstract names. packaging and advertising messages into a single coherent brand personality. This clearly indicates that brand building is a strategic tool for profitability. This invested the brand mark with the quality of goodwill between the then distant producer and consumer. It also highlights the role of brand management in relation to the function of trade marks and other intellectual property rights. It was during the Industrial Revolution that the trademark became an effective asset of a company. and its corollary of product identification. like Kellogg’s cornflakes or Waterman’s fountain pen. a link between producer and consumer was needed to help to identify products. and investment decisions need to reflect that. The maintenance of this goodwill is crucial to the long-term goals of a business. the guild mark did allow the manipulation of local markets in favor of local goods and against external competition. The trademark was guarantee between the producer and consumer that the goods were genuine and of a specific quality. to one where the power of the brand image resides with the consumer.

The elements surrounding the trade mark that make visible the expression of that personality are the task of brand management. Obviously. as the quality is a known quantity. This change in emphasis from the generic product. Not only did the brand mark become a symbol of goodwill. These often include visual metaphors. except the power of advertising to identify and persuade consumers that this commodity is important. The computer chip manufacturer Intel has achieved this spectacularly. slogans and other communication devices used to stimulate consumer demand. look identical to other chips and are not generally understood by consumers. creating for Intel an ideal type of commercial monopoly. separated only by their brand marks and associated personalities. There is rarely a rational basis for this demand. It also encourages new customers to try the product. 14 . advertising campaigns.often loose. This is turn enables the consumer to buy the goods without risk. This in return forces computer makers to ask for Intel chips in place of other manufacturers’ chips. this is vital in all branding to enable brand switching to take place. This is clearly the case today where the proliferation of goods is so created that there are hundreds of functionally identical types.the core of an identity or personality. considering the chips it produces are never seen. It has changes what was a commodity into a very identifiable brand that consumers will demand is inside their computer. It has also been careful to protect its trade mark against counterfeiting. the product. dry goods.to the name or brand of a specific producer’s goods created the role of advertising and marketing communications. The guarantees function is vital as it links the consumer with the producer and acts as a “brand promise” that the quality of the goods is consistent. and brand owners should maximize this benefit in the eyes of the customer. the packaging and the trade mark. It is an excellent example of a company that has maximized its trade mark potential through using advertising and protection. The brand is therefore the accumulation of all these activities. but also it changed what were universal commodities into identifiable products and brands. as the quality of the trade mark similarly deduces the risk of the first purchase. and advertising and informing the consumer of a specific product. for example. Functions of a trade mark There are two clear functions that trade mark can help achieve: a guarantee of consistency to the consumer. Intel insists on displaying its trade mark on the outside of computers for consumers to see.

since it is clearly part of the total trade dress of a brand. since the most important expression of the brand is its unique selling proposition. through brand building and advertising. in its broadest sense. The distinctive 15 . The critical factor in all these elements is that they must be distinctive if they are to be registrable for protection. Pickering (1998) suggests that the Toilet Duck pack for disinfectant probably would receive protection. The Gap’s coherency and distinctiveness are successful elements in identifying its brand proposition and have led to a strong. Consistency of the brand and trade dress will also help to build recognition and increase the chances of successful protection. The Financial Times newspaper might be said to have secured the association of a specific pink color in the public’s min. The use of a brand personality to express these qualities is crucial to differentiate one brand from a competitor. There is a great synergy of effort here for the brand manager. The distinguishing factor is whether the original brand has secured.The advertising function. The informing nature of the trade mark increases consumer awareness of a specific brand. As we have seen. and even packaging shape. This brand component is the essential element of differentiation in branding. sounds and even smells. so it pays to develop a distinctive pack. The more distinctive the trade dress. which would limit other manufacturers. The provision in both UK and US law is still that the pack shape cannot be based solely on the function of the goods. may be the combination of several elements that build up its distinctive identity: the typeface and logo of The Gap. the graphic elements of the ticketing and displays and the style of advertising. Other examples include Coca-Cola’s distinctive bottle shape. simply tells customers what the product is and what they can expect in terms of brand experience and quality. The trade dress is a retailer’s brand. the more successful the brand will be in terms of consumer identification and protection afforded in law. which often incorporates distinctive design elements that have been protected. since it is highly distinctive and yet not simple material to the carriage of liquid. However. logos. protected brand. The key element of trade dress is usually the packaging design. like The Gap clothing store. associations with a secondary meaning. these can consist of aesthetic to represent the name. Trade Dress A trade mark is expressed through the trade dress elements that build up the total protected trade mark. and this evidence helps to protect the brand during any legal proceedings.

Patented works should be marked either “patent pending (2002)” or “patent registered (2002)” depending on the point of product introduction. there is little cross-border protection. the clarity that trade mark registration brings to a case makes it far easier to prosecute in either civil or criminal law. where has been little clear protection for the trade mark. if it is to be distinctive in the market and enjoy strong legal protection. The Direct Line insurance company consistently uses a red telephone in wheels with a jingle tune to advertise its brand. the trade mark laws. and offer equal protection to both.copper and black stripes around Duracell batteries have been applied consistently. this protection is limited. The brand manager needs to formulate and maintain the trade dress. 16 . and should always be suffixed by the date. Trade mark ownership should be clearly claimed and expressed to competitors by the use of one of the following symbols: ™ Indicates that the work is a trade mark but that it is unregistered ®Indicates that the work is a trade mark and has been registered. In the UK and USA. Historically. Trade marks can refer to products as well as services. and it is still the case the onus is on the plaintiff( in this legal owner) to provide evidence against the defendant ( the counterfeiter). © 2002 Indicates that the work is copyrighted. and we will try to examine the one most relevant to brand managers. creating a secondary meaning associated only with Duracell. although later there will also be a brief look at patents and copyright where these affect brand identity. Despite recent attempts at harmonization with the Treaty of Madrid. and the Trade Mark Treaty. using the police as agents. it is not actually necessary to register trade marks to be protected under civil or common law. and it if the trade mark is registered it can be protected under criminal law. The expression of trade mark registration is also powerful deterrent for would-be counterfeiters and those attempting passing off actions. Furthermore. it is therefore vital to register trade marks in every country of distribution. Legal Definitions Intellectual property has many rights of protection under the law. and this would represent its trade dress in the mind of the consumer. However. This needs to be done by a trade mark professional who can efficiently search and check databases and advise on any specific legal issues.

This covers the United Kingdom. Greece. According to European customs authorities. Portugal. Italy . computer programs. Community Trade Marks (CTM) The introduction of the CTM has made it easier to gain protection across the whole of the European Union ( EU) through a single application and registration process. the Republic of Ireland. counterfeiting and piracy. thereby creating more predictability for European businesses. figures of pirated CDs for instance have risen by a stunning 15. Austria. Because the CTM covers all countries of the EU it 17 . Moreover. If adopted. Those sectors most affected include clothes. European customs authorities have been confronted with increasing numbers of counterfeited and pirated consumer products meant to be protected by IPR. The IPR enforcement directive also seeks to bring together all the different pieces of EU legislation currently applicable to intellectual property and other related rights. Finland. Luxembourg. Spain and Sweden. designs. etc. France. authors' rights. The grounds for challenging a CTM are the same as for a national registration. CDs. the IPR directive will bring all these areas under one set of standardized rules. software and now even pharmaceutical industries. generally the lack of distinctive visual elements or its closeness to existing trade marks. toys. the Netherlands. A CTM protects a mark for a period of 10 years from the date of filling and can be extended every 10 years indefinitely. The scope of registrable marks is the same as in the previous national registrations covered above. This resulted in a fragmented body of legislation covering a variety of issues (copyrights.). Up until now. Belgium. the EU has had a thematic approach to the protection of IPR. In recent years. Therefore any current national registrations can be allowed to lapse once a CTM is granted. food. Germany. The Commission proposal aimed primarily at tackling this phenomenon.Features of Trade Mark Directives and Trade Mark Law The draft directive on enforcement of Intellectual Property Rights (IPR) is mainly driven by the will to fight counterfeiting and piracy. the Commission hopes to lift unnecessary barriers to investment and innovation in the internal market and give new impetus to European competitiveness. Denmark. audiovisual. trade marks.300 per cent since 1999 while counterfeited food products have risen by 75 per cent between 2000 and 2001. by creating identical conditions for rights-holders across the EU.

Likelihood of Confusion 18 .is more likely to be opposed or attacked because of the increased difficulty of creating conflict-free. Time limit of trade mark registration. The first is if the trade mark becomes the generic title of a process or category through the actions of the owner rather than simply general usage. The second case for loss of registration is if the product falls into commercial disuse. where some colors have been refused registration. Once the application has been completed and accepted. distinctive marks that do not already exist. Prohibition of a Trade Mark Registration The parameters for prohibition include the following: The trade mark must not be representative of the relevant trade. although the 1994 Act has allowed some colors to be registered: the green color of the BP oil company. and not for future opportunities ( this prevents the stockpiling of trade marks as a purely preventive tactic) Some colors have been deemed as unacceptable for trade mark registration since they create an unfair monopoly owing to the limited number of colors available . The trade mark must not be deceptive or an infringement of an earlier trade mark Trade mark registration must be for currently commercial activities. In the United States the case is similar. geographical or other origin The trade mark shape cannot be that which is based on the nature of the goods or used to achieve the technical production of a product. The trade mark may not run contrary to public decency and morality. and a few distinctive colors that have obtained registration. the trade mark is valid indefinitely. for example. provided the necessary fees are paid and it does not become invalid for any other reason. kind of good or service. process. A trade mark can become invalid because of any of the points covered above and in two other important cases.

19 . They do suggest several ways in which trade marks can be improved to increase the protection available. it must be aesthetic or decorative in nature. In contrast . audio and video works. which are naturally lengthy pieces. The choice of brand name is therefore crucial to its ability to be protected in the marketplace. melodies and arrangements or other compositions. It is typically used for the protection of written work. sometimes called piracy. This is different from counterfeiting. As with trade mark protection.The principle of the likelihood of confusion in the mind of the consumer is the basis of most court judgments in trade mark cases. although in this case the difference of product category is sufficient. where there is a deliberate attempt to copy goods as though they were official.. Kogan Page Ltd. I. the distinctiveness of the trade mark is crucial. A trade mark for Sun dishwasher powder is less distinctive than it might be because it might be confused with Sun computers. In the United Kingdom. p. as each case must be assessed on its own merit in its commercial context. copyright protection only lasts for the lifetime of the originator and a subsequent term of 70 years for the originator’s estate7. the copyright work cannot be a functional item. although in many cases this does not have to be significant. the washing powder Persil is unlikely to be confused with another product because its trade mark is unique. (2002). from unauthorized copying or use. rather than short words or phrases. Copyright is best used to protect compositions.182-191. especially the name or logo. and should not be left as a minor activity. Copyright Protection Copyright registration is used to protect works of originality that are embodied in a tangible medium. Kohli and Thakor (1997) have indicated that the likelihood of confusion can be broken down into the following seven categories: • • • • • • The degree of similarity between the marks in appearance and suggestion The similarity of the products The area and manner of use The degrees of care likely to be exercised The strength of the plaintiff’s remark Actual confusion These are guidelines. The Essential Brand Book. The amount of originality is the determined factor for copyright registration. which are best protected with trade mark registration. 7 Elwood.

and hear from the CEO. Philips of the Netherlands undertook a “ customer day” in January each year. about the new task s for the year. Brand mission Every brand has a guiding mission statement that summarizes its intent to internal and external customers.3. In its troubled years. one day when almost all employees worldwide would pause together to examine best practices. trust and respect IBM: customer service to Disney: family entertainment Starbucks: quality and service. These range from the direct top-down approach of a video of the CEO. corporate days are organized around a program of internal change criteria. The brand name symbolizes these shared values in a single word. It will also mean that staff will have to be properly trained to exclude the brand in their every action. Jan Timmer. The Relevance of Corporate Identity When Considering the Brand The internal staff attitude can play a large role in the development and expression of a brand. any message from the top takes a while to become practice at the front of the business. especially in the service sectors where brand delivery is people-based. If that message is constantly changing. When strong change is required. There are several proven methods and media for delivering corporate missions to all employees. There is a strong reluctance internally to commit to a brand mission if there is an expectation that it will change soon anyway. Consistency of message is crucial in large corporations as they do no react quickly. then the internal and external customers can easily become confused and almost certainly unmotivated. This means that success may involve careful planning of employee reward and incentive schemes. Typical brand missions are: • • • • Hewlett Packard (HP): concerns. focusing on customer 20 . which is shown to all employees as part of their ongoing training. This often takes the form of an annual address to review the previous year’s results and share with everyone the new targets and direction for the future. Employee motivation can drive brand alignment.

differentiation. Structure. the quality systems and associated internal structures such as development process or TQM ( Total Quality Management). organizational structures. in “In Search of Excellence” (1985). This highlights the seven facets of a business that create a collective value system: 1. attitudes and beliefs.and tone of voice of a business culture are an important illustration of the way that a culture behaves. The choice of language. they locate the internal customer within that structure. These are the basic rules that define the business and its separate elements. Peters and Waterman. and shapes and structures the thinking and behavior of those in the culture. have crystallized these issues into a matrix that has become known as the “McKinsey seven-S framework”.market/brand maturity. rituals and conventions.benefits. These might include the management hierarchy. they also bring together and consolidate the brand culture of an organization.directive. It is a collective consciousness that shapes decision making and internal relationships between departments and internal customers. These are the shared values of a brand and they have a strong impact on the performance of the brand in the external world.a marketing led organization. Organizational structures are the tangible structuring processes of an organization that have been formalized. they are mostly intangible structuring processes. the method of rewards and benefits. Smaller versions of these can be held at a regional or local level. Strategy. mass or niche approaches 2. behavior. Rituals and conventions are the symbolic expression of the culture through events and iconic protocols. The culture of business can be explained through its constituent components: language. Behavior is the action take by internal customers that reflects the beliefs of the brand and are expressed through their activity within the organizational structures. Internal brand culture This brand mission is expressed and developed through the internal culture of the business: the behavior and practices of internal customers generates an approach to business and a specific viewpoint on the world. These can be as simple as buying a cake on a birthday or the deference shown to experienced internal customers. Beliefs and attitudes are the underlying assumptions that an organization has about the world. The language both reflects the cultural status. requesting or inspirational. tactile approaches and portfolio management issues 21 .

(2002). but its consistency of core benefit that consumers will buy into and remain loyal to. investment and market effectiveness measurement tools. p. From the moment an employee picks up the phone to the time they deliver the final invoice.a branded culture. as with any merger. Staff.motivated and brand aware internal customers. is to integrate successfully the best of both brand cultures. it requires long term management techniques and not short term tactics. The sufficient trust with the consumer is everywhere. The people who work for the company are therefore as important to the organization as your customers.238-241.. training to develop the internal language of the brand 6. Their collective impact on an organization is vital if significant and sustainable change is to be achieved8. The challenge. multiple brand personalities or a single personality around the globe including the tone of voice of the brand 5. non traditional banks to take their market share. Skills-adding value to brand proposition.266-271. while eliminating the worst of the previous brand cultures. In this age of merger and acquisition . which drives business performance and innovation. The aura or promise that a brand represents to consumers can be updated over time. customer intelligence networks. bringing the brand to life Each of the elements has a separate role to play in the building of a corporate brand culture and each must be assessed independently and collectively when corporate change is needed. I. The Essential Brand Book. 4. The combination of these creates an organization with 7. Kogan Page Ltd. The value of the internal culture of brand to a business must be clearly understood as a strategic tool and equity. Shared values.and then their delivery to that promise. it will be hard to maintain customer loyalty through consistency of message. and allowed other. Style-competitive stance .3. Strong brands provide the differentiation that helps attract and retain talented employees who then become the true advocates for the business through their understanding of and belief in your vision . The recent spate of bank mergers in the United Kingdom has exposed their weakness. 8 Elwood. brand management style. 22 . the company has the opportunity to reinforce and clarify its brand’s positive position. p. Systems-customer database management.

com. A Branded World: Adventures in Public Relations and the Creation of Superbrands. The Essential Brand Book. (2003). New York: Wiley. M. Manning. (2003). (2002). 23 . Heinemann. www. I. Kogan Page Ltd. (2004).Bibliography: Chernatony. and McDonald M. Creating Powerful Brands.allaboutbranding. Article Naming of a Brand. Elwood. L. S. Levine.

Different Brand Awareness Levels 2. Awareness.Chapter II The Influence of the Brand upon the Consumer 1.1 Establishing and Maintaining Brand Loyalty 2.Brand Awareness of the Consumer 1.2 Repeated Buying 3.1. a Quantitative tool for Evaluating the Brand 1.Rational and Emotional Dimensions of the Brand with high impact on Consumers 3.1 The Cognitive Brand Dimensions 3.2.2 The Emotional Brand Dimensions 24 .Brand Loyalty 2.

contributing to the development of their preferences(by limiting the range of other possible choices). as it helps them to make buying easier.the rational and the emotional dimensions of a brand. Consumers are obviously touched and influenced in their buying habits by the specificity of each brand. a quantitative tool for evaluating the brand Awareness is a multifunctional tool for the company that chooses to make licensing or form joint ventures.Awareness. A familiar part of the everyday environment. The theory of memory has shown that the elements referring to the brand are indeed stored. This is one of the reasons why communication policies often mainly aim to increase or maintain brand awareness. The superior levels of brand awareness develop it time what is called brand loyalty.The Influence of the Brand upon the Consumer The second chapter of the paper refers to the impact of brands upon the consumers. That is why the last part of this chapter proposes an analysis of the two main coordinates of the brand structure. The well known brand evokes durability and reliability. The marketing team should conclude after studying the market where is their product located in the consumer’s mind and in his/her buying behavior.buying one or several brands becomes a habit for a longer period of time. processes that would be a whole lot easier. as well as the strength as well as the links between its different aspects. 1.the partner company will benefit from the brand awareness. the brand becomes a point of reference for people. 25 . Managers can quantify the success of their businesses by using instruments for capturing the feedback from the consumers.Brand Awareness 1. Awareness is very useful as it shortens and over-simplifies the choice process and buyers appreciate this. The diversity of this information.1.

The maximum awareness level is reached when the brand is present in the mind of the buyer ( or of any other buying center number) who refers to it even outside of the purchase of the products or services concerned. since it is through knowledge of the brand name that a customer asks for one brand or another. The psychological phenomenon of memory saturation leads to powerful entrance barriers. As soon as interest in the supplier brand increases. Brand awareness. the brand hits a memory saturation threshold because a strong brand limits the memorization of others. and where. available range. This awareness level often corresponds to the case where the brand evaluated is already a company supplier.Brand Recall Recognized Brand-Brand Recognition Unknown Brand-Zero Level of Awareness Figure 1 Levels Of Brand Awareness . needs to be maintained and supported in light of the influence of other brands and their market positions. it is better known: quality of services. the information level of the customer company 26 . In fact. This is a key concept. The different levels of awareness have been identified: Well-Known Brand-Maximum level of Awareness Known Brand.correspond to associations which are linked in memory to a brand and could only be remembered if the brand has reached a high enough awareness level. which is difficult to establish . therefore. So a brand’s striking characteristics can inhibit the memorization of other brands.2 Different brand awareness levels Brand or company awareness can be defined as an individual’s level of knowledge of the company or brand in question. the most well-known brand having a great advantage. product reliability. corresponding to the brand mentioned first by the buying center member questioned. The highest degree of brand recall is top of mind . thanks to acquired experience. 1.

the brand can still evoke certain images and suggest certain values. but if he/she is reminded. variable way. does not refer directly to the brand.country of origin. -The second awareness level is when the brand is known. At this stage. etc. The corresponding measure is brand recall. Flamingo. When the customer is questioned about a product category he spontaneously refers to the brand . 9 Klein. but in a non-linear. The customer when questioned. depending on the product. which corresponds to a zero level of awareness. there is the case when the brand is not known by its potential customers. However. -The third level is when the brand is recognized.87-89. p. This knowledge has different sources from information picked up at trade shows to the ones from business publications or information passed on by friends or colleagues. 27 . Brand recognition corresponds to often limited knowledge of the brand or the company. he/she is capable of describing the product categories concerned. The corresponding measure is brand recognition. No Logo.increases. -Finally. there is not enough information to incite a customer to buy a product or service. Brand recall and recognition are always linked. even more so than a potential customer. A company that is already a customer is hungry for information about the supplier brand. The brand does not benefit from any awareness and doesn’t evoke anything for potential customers9. but among other competing brands. Naomi (2003). This type of awareness corresponds again to a relatively high level of knowledge of a product. activity field.

This may be because the brand uniquely provides the benefits they seek. but instead represents indifference on the part of many consumers. Consequently.2. This pattern of buying the same preferred brand each time a product is purchased is called brand loyalty. represents a key target segment for most firms that they should devote maximum effort to satisfying. consumers repeatedly buy a brand out of habit or routine problem solving in order to save time and effort. have long attracted the attention of marketers and consumer researchers. differentiated. but brand selection is not completely stochastic either. Sometimes.how often or what proportion of purchases are allocated to s single brand. competing brands will tend to assume relatively stable market shares as consumers tend to purchase the same brand ( or patronize the same store) time after time. however. Brand loyalty can also stem from the emotional impact the brand has on the consumer or the way the brand makes the consumer fell about 28 .1 Establishing and maintaining brand loyalty In mature markets. the construct of brand loyalty has proved to be difficult to define precisely and measure reliably. Consumers may form strong personal attachments to brands. It is obvious that virtually no consumers buy the same brand every time they purchase. which occurs when consumers buy different brands. Brand loyalty is highly valued because it facilitates segmentation based on usage and because it is cheaper to sell a product to loyal consumers than to attract non-loyalists to your brand. or its personality himself or herself. Thus brand loyalty is a matter of degree. the core loyalists. fits well into their lifestyle. reduces consumer risk and helps guarantees standards of product performances for consumers. The consumer franchise. the subject of brand loyalty and its complement. brand switching. Unfortunately. Consumers develop repeat buying patterns because they learn that particular brands are especially satisfying or they come to form personal attachments to the brands. as Coca-Cola found when the firm sought to replace Old Coke with New Coke. whether true loyalty implying a positive emotional or affective reaction to the brand or simple thoughtless habit. Repeat buying. This repeat buying pattern may appear to be true loyalty. Brand Loyalty 2. This issue has (image) matches that of the consumer.

proved so troublesome that one source details over fifty separate attempts to define and measure brand loyalty. especially as generic products sold strictly for their lower price appeared in stores. that images and reputations will decay in the face of price discounting by major retail chains who have come to dominate the distribution and merchandising of many consumer goods. ‘own’ label or ‘store’ brand of product. symbolic. many of which fail to yield similar results on the same objective purchase data. interactive. Further studies. valued added relationships. these figures had fallen to 64 and 56 percent. Such challenges will surely stimulate marketers to find new ways to build loyalty to their brands. Brand loyalty may also vary by purchase situation as consumers tend to prefer certain brands for specific occasions that they would not use at other times. however. seem to attract more loyalty from consumers than do commodity. One recent tactic for loyalty building has been termed “ frequency marketing”: to identify. FM stands for an interconnected set of programs designed to link customers with 29 . or emotional benefits such as cigarettes. through long-term . which eats into the margins of the ‘name’ brand product. This problem of conceptualizing and measuring brand loyalty is central to marketers concern for their target markets and how to retain their loyal consumers. Harper and Steers advertising agency found that 80 per cent of men and 72 per cent of women agreed: ‘I try to stick with will known brand names’. heavily discounted but supported by the ubiquity and reputation of the mass market distributor. or provide specific hedonic tastes such as coffee. This specter of the brand as commodity frightens many manufactures of branded merchandise. Moreover. respectively. In 1980however.like products such as aluminum foils or garbage bags. published figures suggesting that brand loyalty for many consumers goods held steady or actually increased a little from 1975 to 1983. and increase the yield from best Customers. In 1975 a survey by Needham. Short History of the Brand Loyalty in the USA There was some concern in the 1970s that American consumers were becoming less brand loyal than before. Even more frightening is the growth of the private label. The fact that many consumer goods are purchased for use by different household members also makes brand loyalty difficult to define and detect. maintain. Part of the reason this issue is so complicated is that the tendency to be loyal to a brand differs from one consumer to the next. Products that provide strong social. Concern is again growing that store and brand loyalty are eroding. consumers in general are more loyal to brands in some product classes than in others.

The Burger King Kids Club. In this ‘leaky bucket’ theory of other-brand users to switch. 2. and discounts with partner airlines. and other marketing mix variables to replenish the loss of these old buyers with new buyers. The picture of the market provided by aggregate purchasing data appears to show the success of these efforts as large percentages of buyers fail to purchase the same brand at each purchase. marketers must constantly use advertising. they will have unique images that consumers perceive and research measure. In the light of the difficulties observed in reliably and validly defining and 10 Randall. G. A Practical Guide to Planning your Strategy.brands by engaging them into clubs entitling members to special discounts. Branding. without some level of repeat buying. IQ. Boomer. tie-in purchases. and other privileges. a new brand will not survive the maturity phase of the product life cycle. p. 30 . The topic of repeat buying is important because. credit cards. features characters such as Snaps. newsletters. Wheels and Paws. Advertising and sales promotion are emphasized as the means to persuade consumers to switch brands or stores. This is the idea of product differentiation and brand loyalty. that consumers form positive attachments to particular brands and limit most of their purchases in a product field to a single or a very few brands. Kogan Page Ltd. for example. Free club membership entitles members to a secret code name. promotions. Although objectively there may be few differences among these brands. promotion. Kids Club Meals at Burger King restaurants offer premiums like Lickety Splits ( toys that are shaped like French fries and burgers) Teenage Mutant Ninja Turtles and Beetlejuice Figurines10. In this leaky bucket theory of consumption. Many contemporary observers stress the effects of sustained promotions on eroding brand loyalty.2 Repeated Buying The concepts of market segmentations and product positioning we have presented imply that the overall market will consist of relatively homogeneous segments to which marketers position brands using their marketing strategies. 39-45. leading consumers to become more price conscious and place less emphasis on the image of the brand itself. (2000). Most descriptions of brand loyalty and switching imply that consumers are loyal to a single brand loyalty and switching imply that consumers are loyal to a single brand in a product field and remain so unless competitive marketing efforts lure them to another brand. Jaws. a subscription to Adventure newsletter.

without being influenced by marketing speak. 211-216.measuring brand loyalty ( Jacoby and chestnut 1978 ). not a heater. he argues that repeat buying behavior is more stable than this and can be described by a mathematical model. a French avant garde designer. Kogan Page Ltd. 45-48 12 Ehrenberg. The cognitive dimension is the pure need of the consumer. In a large and methodical body of research. An alternative view of repeat buying is presented by Ehrenberg (1988). This idea has been reflected in the quote of Phillipe Starck. Research is used in these two cases too with the purpose to determine these needs of consumers.C. p. A Practical Guide to Planning your Strategy. The cognitive value of the brand is present in the case of all successful brands. A. the world wants warmth. another perspective may be more useful to managers seeking to understand repeat buying behavior11. 3. consumers form relatively stable buying habits after a new product is introduced into the market or their need for an old product makes it new to them. Branding.1 Cognitive Brand Dimensions Consumers of brands use cognitive filters in order to make the proper decision about choosing a certain brand. For many frequently purchased products. consumers go back to their old buying patterns12. (1998). it is one of the aspects that creates and retains customers. Charles Griffin. It is important to evaluate the rational or cognitive and emotional components of brands in order to understand to what consumer needs they respond to. as they strategy ceases. 3.” There are many brands which missed 11 Randall. Rational and Emotional Dimensions of the Band that Influence the Consumer Consumers have both cognitive and emotional expectations from brands in order to satisfy their cognitive and emotional needs. using significant target consumer groups. which says: “The world wants water not taps. Repeated Buying. p. (2000). and marketing efforts that cause them to ‘switch’ loyalty can only achieve short run success. That is. They cease to give a great deal of thought and energy to evaluating brands in the field. 31 . G.S. it appears that consumers form a stable propensity to purchase a brand or brands in a given product field much as a habit is developed.

If the company hadn’t understood that. There is a series of tools that makes more noticeable the difference between the secondary values of the brand and the main cognitive values of a brand. There are four cognitive dimensions that develop brands along different routes to success: • Brand weight.their cognitive value by expressing assumptions about their consumers or about the market. Without these values the brand personality would be blurred and confusing for the consumer. rather than being driven by consumer needs and desires.the dominance of a brand in a market. Taking airlines as an example the answer would be that the main purpose is to fly people. To categorize these needs they must be analyzed to separate the first-order needs from the higher emotional needs. Brand managers need to recognize first of all the purpose of their business. it might have simply created a new soap brand with a different fragrance or ph value. in order to do this they should try to list the possible needs the consumer might have surrounding the product category. The studies might discover that there may be an excellent new brand opportunity that the consumer has been waiting for. This can be achieved by making an insight in the consumer’s mind or by studying human life in order to observe human needs in order to observe the latent needs that the consumer was unaware of. but the consumer may understand what they provide as: • • • • • the vacation business the meeting business the taxi business the once-in –a –lifetime experience the glamour business Most of these are true for many consumers and it is important to identify which are the most significant to be used in building the brand proposition. The company understood that consumers wanted clear skin that resulted from soap. Ethnographic and video observation techniques can often provide these kinds of insights to problems that consumers have adapted to or learned to cope with. Once the brand manager understands in what business he is in.g. e. 32 . it is easier to express the cognitive added value through the brand personality. Microsoft. The Dove brand of soap introduced the cognitive benefit of moisturizing plus soap cleaning as a new product brand .

the appeal of the brand across consumer groups. e. or the packaging business or the breakfast business. managing their business as large-volume. Virgin. which could then be used to manage markets as well as their brand. low-margin operations. Everything it does is focused on enhancing the taste experience of eating Kellogg’s Cornflakes. 33 . This may be a new toasting process to add crispness to its rice. Coca-Cola. Brand breadth. Many Japanese companies followed this route during the 1980s. Often it is new entrants that quickly reduce the brand weight of a brand that does not continuously invest. but they cannot be used to build the brand.g.g.the loyalty of the consumer group. it is often referred to as simply the market share. It can also cause complacency in a business. Of course all of these things are important and add value to the brand in a crowded competitive market.It never forgets that it is in the taste business. Many marketing directors still specify a number one or two market share position as a critical measure of a brand’s performance. it is possible to increase R&D spend and innovation. especially if market share exceeds 40 per cent. Once a high brand weight is achieved.• • • Brand length. while slowly increasing prices and margins to accompany this growth. Disney. Apple. trade and media. e. not the rice business.g. exerting influence over smaller competitors. This often resulted in high brand weight. It can also be the total dominance that a brand exerts over the mind of consumer.the ability of a brand to diversify across business categories. Kellogg’s is continually developing new technologies to enhance the taste of its products in order to deliver improvements to the core cognitive need of a great-tasting cereal. Coco Pops . or a new type of paper for the cereal bag to retain freshness. Traditionally. Dominance in a market can be developed through maintaining a rigorous innovation program that keeps the brand at the forefront of the consumer’s mind. Brand Weight This type of brand goal relates to the dominance of a brand within its chosen market. high brand weight has always been a core goal for business. Rice Krispies. Brand power. as the market looks secure. e. but is more than this.

often unrelated in the traditional sense. T-shirts. even though they represent very different business categories that other suppliers would not dare to cross. The Disney brand expresses family entertainment in all its film productions. but. continue to purchase the brand in other categories. Alternatively. once satisfied. Each item also has a series of added value brand dimensions. Dixons the high street retailer and the Virgin group. The central cognitive need is clearly upheld in all these items. They operate a basic brand promise that can be applied to a variety of categories via a franchise with the consumer.Brand length Achieving brand length focuses on increasing the flexibility of a brand across market categories and segments. This is a clear indication of the power of a brand identity to convey messages to consumers and retain their trust. games and toys. the core benefit is reinforced by the Disney brand promise and itself reinforces the Disney-ness of the product brand expression. it could emphasize the continuing mediation of identities and the reliance of consumers on those mediated identities to make choices about their lives. Brands that achieve significant brand length do so by marking out a specific territory in the mind of the consumer and retaining that position across all their activities. but they succeed because the core brand proposition remains clear and fulfils the basic need for a large proportion of the consumer population. the police or the high street banks. Large-scale free Internet service providers have also come from the unlikely sources of NTL. The message for governments and institutions is that they must at least match these high levels of seductive media if they are to re-establish their standing and authority with the consumer. Brands achieve this by displaying a power of expertise. The thing that relates the in mind of the consumer is that they deliver the same cognitive brand promise in all their guises. a Disney soft drink . not in technology but in their understanding of the consumer’s mind. books. a Disney holiday or a Disney movie. the traditional world of banking has seen supermarket entrants Tesco and department store Marks&Spencer vying for the consumer’s financial capital. theme parks. 34 . They are the ultimate lifestyle brands that people are attracted to because they fit their needs and desires in one category. perhaps as a result of a mass faith in liberal market economics. family and finances. Whether this is a Disney baseball cap. Some of these have taken advantage of several consumers reports that highlight the fact that more people trust Sainsbury’s and Tesco than the government. In the UK.

it becomes more difficult to retain the human characteristics that first attracted a large number of consumers. This goes beyond the implicit cognitive benefits to provide an explicit emotional benefit that can be highly distinctive for particular brands. Typically. Once the corporate regulation and processes take over in a business. Obviously. must be carefully planned and executed impeccably if it is to succeed. once broken it is difficult or impossible to retrieve. like any stretch. The bond of trust with the consumer is the critical dimension to any brand proposition. Brand power is often described as customer loyalty.When a brand tries to encompass a wide range of business categories it may fail to achieve significant profitability because at one point the brand promise will not stretch far enough. Brands like Apple. Nike and the BBC all retain the strong brand power that connects the business closely with consumer in a symbiotic relationship. As this occurs. Brand power Brand power is the strength of an individual or business to influence others. It forms a dialogue that reflects a strong commitment from both sides to developing an enduring relationship. it is much more important than that”. consumers of power brands are acolytes and can be relied on to generate a formidable word-of-mouth campaign for the power brand. fashion-oriented brands are more likely to receive this kind of attention. The old adage about football can be rephrased here for power brands: “ Branding is not a matter of life and death. If there is insufficient trust projected by the brand. Each new brand extensions. but successful companies from Ben & Jerry’s ice cream to The Body Shop cosmetics chain strong brand power is the depth of emotional attachment that a brand creates with consumer. it must be to convey the trust that the consumer needs to have in a product or service to buy in the first place. in this case the consumer. 35 . but many quickly lose it as they become out of touch with their core consumer benefit. but it goes beyond that with a quasi-religious connection between the consumer and the brand. the consumer may never know just how good the product or service is. the dilution effect on the core brand and product combinations will also reduce the validity of the brand offer. Young start-up businesses often have this type of brand dimension. These companies have attained a brand fortress for themselves where they can heavily influence a usually intensely loyal customer base. If you only say one thing with a brand message.

This may seem ideal. gender and age filters. There are not many brands that are clever enough to satisfy across these target group without diluting their brand is perceived to be a appropriate for one target group. your brand and the consumer target group. but in a c competitive environment they also need to retain distinctiveness for their proposition. These include financial. A brand that has successfully generated powerful propositions as well as wide consumer franchise is Coca-Cola. The result is a brand that is inoffensive to most people. while offering an inclusive attitude towards all consumer groups. Kodak. class and other socio-economic dimensions create a huge diversity of needs and expectations. Strategic cognitive filters To help understand what kind of unmet core need the business fulfils. the world’s most recognized brand name. especially when the age. Free market economies encourage and enable brands to be successful based on the 36 . The cognitive financial filter In the westernized world it is not surprising that one of the most basic brand dimensions is a financial filter. rather than inclusive for other groups. these are simply examples. retailing and service industries need huge consumer to be viable. it is possible to clarify the brand proposition.Brand breadth Another strategic dimension for a brand is to develop a consumer franchise that spans the widest possible range of consumer groups. it is worth understanding some of the filters that brands express to consumers. The problem is that try to attract as many people as possible the message must be inclusive and this often results in a bland message. There are many more filters that can be used. since it maximizes the selling opportunity to as many people as possible. By examining the core unmet need through these cognitive filters. but fails actually to attract anyone. Visa and Microsoft have also achieved this kind of brand breadth. large businesses in consumer electronics. depending on the nature of the market. drunk by small children in developing countries and CEOs in the world’s capitals. McDonald’s. sex. but it is difficult to achieve. Their success is due to retaining a distinctive propositions compared with their competitors. Clearly.

because that bandwidth increases as the price decreases. or risk being undervalued in the marketplace. whether coverage is across the whole market or simply a small niche. The brand may be a bargain own label. This structuring usually takes place as bands of prices that follow each other up the financial scale. The brand manager needs to know which competitors fall above and below them in order to make tactical use of the brand proposition. Brands at the bottom of the band may be considered to offer similar benefits but at a slightly lower price and therefore better value. They use prices as a key guide to which part of the market they fit into. or a premium top of the line product or service. sometimes overlapping. The result of choosing one of these categories will dictate a large proportion of the attracted consumer group. Brands at the top of the band may be considered to offer better quality but at an inflated price. and vice versa. Most brands use sub-brands or brand extensions to increase the bandwidth of their business revenues. The Giorgio Armani brand occupies the luxury end of the clothing market and it carefully uses a financial filter to define its target consumers. The Cognitive Gender Filter An important question to be answered is : What gender is the brand proposition? It could be masculine. This is the fundamental advantage of a strong band: an ability to generate extra revenue above that of competitors and the production/ distribution costs. or a mid-priced value pack. There is also the Emporio Armani brand. Brand managers can use the financial filter to decrease or increase the bandwidth pf potential consumers. the point of purchase . It can also be used to reflect a known majority market . or reposition a brand into a new market. The gender filter of a brand is often associated with the 37 .price that the consumer is willing to pay for the brand (a price above any notional commodity price). Still lower on the financial scale are the Armani Exchange and Armani Jeans brands that cater to the mass market. The market can always be sub divided into many financial segments. feminine or universal. For consumers. the financial filter is not fixed over time but only at a single moment in time. when economic capital (cash) is exchanged for brand capital (identity). and it acts as a starting point for a brand manager who is trying to reposition the brand. which tailors itself to a lower financial target. The chosen price should therefore best represent that enhanced proposition. This structuring of the market helps consumers to filter out the choices that are unavailable or undesirable for them.

The My First Sony uses sophisticated images to sell both to the young themselves and to their parents. The products have a youthful design and the quality is identical to the products for adults. The latest tendencies show that using ‘grey’ targets instead of white and black ones is more and more common. the sub-brand of Sony is the quintessential baby brand and it has encouraged many brands such as Gap Kids. The gender filter helps consumers to structure their choices when they come to purchase these goods. because if the brand lets consumers down they might never use that product again. The use of trans-gender branding has been obvious for the past years. 38 . The Renault Twingo was targeted at young people. where CK One led the field of fashion brands to propose dual-use fragrances. The Cognitive Age Filter Many brands want to target specific age groups and this will require appropriate brand personalities. As a consequence. but many brands can have a brand gender unrelated to these. promising a lifetime of loyalty. There are many examples of brands that have deliberately tried to filter consumers on the basis of age. after that finding out that their true consumer is typically from a different age category. By this means Sony draws a significant advantage because it captures the consumer early. but it was bought by different types of users of varying ages.gender-related nature of the goods or services. My First Sony. They were all attracted by its interesting styling. By using a high degree of quality Sony creates a powerful barrier against inferior brands. young consumers treat the Sony quality as the first standard by which all other products are judged. The car company Renault and the company Nescafe have a feminine bias that can be used to filter target consumers.

Maslow’s Hierarchy of Needs Abraham Maslow, the behaviorist, developed a useful framework for understanding the needs of the human needs in terms of cognitive and emotional requirements. The simplicity of the pyramid generates an immediate understanding of the needs of the consumers, from the core psychological needs to the higher needs of self actualization.

Self Actualized

Preference Relativity Stability Basic Elements

Figure 2 Maslow’s Hierarchy of Need The lowest layer contains psychological needs: shelter, food, water, etc. The second layer contains the safety needs: the need for financial security, family stability, trust and predictability. The third layer contains group needs: the need for love, group belonging, family relationships. The highest layer contains the self-actualization needs: the need to be who we can be, the need to be as good as we can be. The first two layers represent cognitive needs, while the remaining three are largely emotional needs. Maslow suggested that people tend to fulfill their needs systematically, starting with the basic physiological needs and then progressing up the hierarchy towards the highest layer. It means that the branding team needs to be aware of the different stages of development of distinct markets and consumer groups in those markets13.

3.2 The Emotional Brand Dimensions
13

Elwood, I. (2002), The Essential Brand Book, Kogan Page Ltd., p.148-159

39

It is difficult to analyze quantitatively the emotional dimension of a brand, but they could be revealed through qualitative research approaches. Analysts have found a matrix of four emotional elements of a brand. These are ideological pleasure, psychological pleasure, sociological pleasure and cultural pleasure. The Pleasure Dimension This approach to emotive satisfiers focuses directly on consumer needs. It considers the need of consumers to hold different values at different times and in different contexts. The pleasure approach of branding seeks to maximize the benefits and expresses the consumer satisfaction of a brand. It is also important to think that brands can also be a potential displeasure or source of dissatisfaction to consumers. The branding team should avoid communicating displeasure to target audiences. For example if a brand disappoints consumers, the branding team should act so as to retain somehow consumer loyalty. Identification of potential brand displeasure characteristics is a useful weapon in the context of competitive analysis of brands. The four pleasures or four satisfiers of branding are: Ideological pleasures, belief systems. Psychological pleasure, task achievement. Sociological pleasure Cultural pleasure, iconic satisfaction.

ideological

psychological

Figure3 Emotional Dimensions
sociological
Cultural

These four pleasures form the framework to understand the characteristics of emotional attractions for consumers. The branding team needs to define the focus of a brands personality.

40

Ideological brand pleasure Brand ideology refers to the highest level of consumers’ values. They are the most difficult to change because they represent beliefs that the consumer may have held for a long time on the basis of their education. This category could be an advantage to a business and help to build a significant segment of loyal customers. In the context of brands, the ideological pleasure relates directly to the meaning that a brand has and the idea that it embodies. The most common ideological pleasures are: -religion, patriotism, morality, aesthetics, ecology; while the most known ideological displeasures for the common consumer are: immorality, ugliness, fears, racism. 3.2.1 Ideological pleasures as surprised in the car and cosmetics industries Patriotism The country of origin of a brand may have deep connotations for the consumer. These can be ideological brand satisfiers when they align with the consumer’s ideology. German automobile companies such as Mercedes- Benz, BMW and Volkswagen-Audi they all used their national heritage in the in their company brand identities. Consumers can recognize German characteristics such as precision, quality and reliability; these characteristics are projected over the cars produced by the German factories. This connection between national values and certain brands have proven itself very successful so far. Automobile manufacturers in Italy are expected to join in their cars the style, the energy and flair that characterize the Italians. However the consumers must also accept that the Italian heritage has a connotation of being temperamental and also unreliable. In the end consumers think which of these brand dimension are more appropriate to their needs, so decision is made very often based on an impression of a nationality rather than any specific facts about the brand they are interested in. Brands do not always need to come from a specific country to benefit from a connotation associated with that country. The brand name and its visual promotional materials can suggest a particular origin. Haagen-Dazs is a prime example of the use of borrowed heritage. It is a company set up by two American companies that produce luxury ice cream. They used this brand name in order to

41

2. It promotes recycling the containers and it does not test its products on animals. it uses specific techniques to express this side of the brand. Using this name implies the idea of tradition. 3. which the American firm actually owns. Psychological brand pleasure Psychological brand pleasure refers to the personal achievement gained from a brand personality. There is a resistance to eco brands because they often seem quite aggressive and may even alienate certain consumers. failure or defeat. The company helps the development of small businesses of farmers in some developing countries. These consumers pamper themselves without a guilty conscience.2. Using the environmental issue as a central dimension of a brand’s personality can attract consumers who have similar beliefs. Brands that maximize the psychological benefits are more often found in domains such as personal care or the home environment. Branding executions are often in natural materials and colors. They rarely wish to be lectured in a moral or ethical tone by companies to which they have paid money. Ecology The environment and the ecology are significant contemporary issues and therefore they can be used as important brand personality trait for certain brands. 42 . The Body Shop is an excellent example of a brand that has differentiated itself by its environmental beliefs. Environmental concern can be equally a brand dissatisfier for the target group for the target group for luxurious products. This is related directly to the performance image of a brand because it could have a satisfying effect due to its sense of triumph or victory. Companies that have a strong environmental position may appear too boring or politically correct for some consumers. On the other hand psychological brand displeasure can involve a sense of boredom.suggest a Scandinavian or Nordic atmosphere. Using simple shaped jars for creams emphasizes utility over hedonism. it is very experienced and has a lot of knowledge about the freezing process.

In the case of an overstatement of what a brand stands for. Everybody has seen at least once the TV commercials in which a dentist was advising the viewers to use Colgate or the doctor recommending Anitra for keeping the hygiene of the bathroom. low interest. Consumers often appreciate this kind of independent advice as a method of distinguishing between brands. as it addresses customers on a level of psychological brand pleasure. technology and performance . low success..Psychological brand pleasure can be changed more easily than the ideological beliefs and often changes as the consumer develops knowledge of that category. Brands often use forms of endorsement to confirm their performance and superiority. a . if not even bored with this series of superlatives. The use of power. failure.Examples from man personal care and the home environment domain Gillette’s campaigns for attracting customers has always associated the brand with the ultimate performance. as both gain the 43 . The customers must decide whether they need or desire the best for themselves and suggests that the only way to achieve this is with Gillette. This often occurs between hardware and software manufacturers. Authority can be claimed through accreditation by a professional or by an institutional organization. Branding on performance has been a key weapon in many categories. or they may simply use connotations of professionalism such as actors wearing a white laboratory coat to connote scientific or research knowledge. They may also be presented in advertisements with actual professionals such as doctors. Gillette’s use of ultimate performance challenges other producers to generate a more powerful superlative for their own brand. it all engages with the male psychological need for aggression and competition. mental stimulation. lack of enjoyment. especially when targeting male customers. These statements of quality are often present as approval stamps or signatures of accreditation on the packaging or on the promotional material. but in a certain moment it is possible that the consumers will feel almost. performance. The headline “The best a man can get” is difficult to ignore. Psychological displeasures may be: boredom. scientists. consumers may no longer believe or accept the claims of the brand. Potential psychological pleasures are: personal satisfaction. achievement. All these could provide independent evaluation that can be separated from the manufacturer’s own claims of performance. A different route to endorsements is using a common image of two companies recognized as experts in their fields.

Using the appeal to all the human senses helps to creating a unforgettable brand experience. The psychological benefit gained by the consumer that a particular detergent was made for a particular washing machine is very convincing. Engineers working in the Honda campaign have invested in the leather smell that reinforces consumer perception of quality.benefit from cost saving on marketing campaigns. For example soft powder companies often collaborate with a particular washing machine manufacturer in order to get mutual sustaining. It is known that the Mazda MX-5 engineers listened to classic English sports cars before tuning their new engine. 44 . Enjoyment of the five senses Psychological brand pleasure can be gained by offering the consumer a feeling of total enjoyment. People have a very strong sense recognition and recall different types of sensations most of the times. It has literally defined itself as the fizz company. b. Color psychology can be at times effectively used to revitalize the traits of a brand personality. Sound. Consumer electronic companies have also started adding subtle fragrances to their plastic moldings. This can be achieved by stimulating the five senses and is very helpful when talking about services. must be distinguished from noise. trying to develop a company-specific brand fragrance that the consumer will recognize and appreciate. In the car industry sound has always been associated with the perception of performance. Schweppes has built its brand personality around the refreshing fizz of opening a bottle of its carbonated drink. Visual images are usually the starting point for branding: color in particular can have an enormous impact on consumer perceptions. all other drinks companies are then usually defined against this in consumer perceptions. Language and text can also play an important role in developing and fulfilling consumer expectations. which is not a wanted accessory for a product. which is created and defined. The tone of the language is as crucial as the message it is transmitted. campaigns try to exploit this kind of human potential. When the measures taken match very well the consumer expectations the post –purchase satisfaction is the highest. They do not have to worry about cannibalizing each other’ s market share as they are complementary products.

performance and reliability of a product and the brand. It is extremely shallow to suggest that a badge can define one’s character. However.2. the group members interact with each other on the basis that they have something in common. What your clothes say about one person has been transformed into the philosophy “you are what you wear”. The thickness and texture of a corporate brochure suggests quality most of the times. 45 . they can exclude you from that group. 3. for instance. as it is part of human nature to form groups and sub-groups. There is also little consumer awareness of a definitive and usable scale to classify different tastes. Sociological Brand Pleasure Sociological brand pleasure is derived from the satisfaction that customers get from group association and recognition.Taste is used naturally mainly in food and drink branding. Wearing visibly branded clothes offers a recognizable statement of values that can be understood easily by others.3. The physical design of a branded product can have a significant impact on consumer perceptions of the contents. Developing a distinctive McDonald’s essence to all its food and drinks is a priority in markets that have strong competition of apparently identical products. or else. The physical evidence of a brand can also help define its personality. once a consumer finds a brand taste that he or she enjoys. It is a real challenge for cola companies to brand tastes. Companies producing cola beverages made blind taste tests which very often lead to unclear conclusions. the consumer loyalty develops on solid ground. but many research studies have shown that most people relate to such symbolism. The use of brands has particularly helped groups to define membership and their social territory. Branded clothes. are clearly used to include yourself in a specific social group. This type of brand pleasure is based on understanding a group’s identity and has the purpose of satisfying the need of socialization. Sociological brand displeasure relates to the exclusion of people from a specific group because of the brands they use or do not use. Consumers can communicate real or identities to which they aspire towards the members of their group. However sociological brand pleasure changes as it depends on fashion and trends which change quite often. Sociological brand pleasure is very important for consumers as an expression of status.

The Polo name and logo suggest a leisure activity of the upper classes. It is a badge of membership to Ralph Lauren’s aristocratic club. Equally. They also suggest a form of upper class lifestyle intended to be very inspiring. the sociological discomfort from being visibly excluded from a group is strong. retail. fear. While this is not necessarily a good thing. love. 46 . The potential sociological displeasures are: loneliness. Consumers wearing heavily branded clothes are publicly affirming their commitment to that brand.Potential sociological pleasures: friendship. The brand logo is there to be recognized by fellow consumers or friends.com The Polo brand draws on themes that imply feelings of nostalgia most of the times. Using such explicit branding as a logo on the outside of a polo shirt indicates its strong social function in forming brand personality. Figure 4 The Polo Logo Source: www. For example. The sociological value gained from belonging to a chosen group is strong. group identity forming. isolation. belonging. This form of membership has increasingly been used in the fashion industry to capture and retain target groups. Examples from the fashion and car industries Fashion brands generally rely on group identity characteristics and therefore offer sociological brand pleasure. but it is presented as being available to a wider audience. anonymity. It has developed a total brand experience implying equally the product. not having the correct brand of training shoe can be embarrassing for teenagers and adults alike. offering a brand experience that is casual .polo. evidently it generates a huge aspirational market for such brands. customer service and advertising materials. Members can easily recognize each other on the street and accept that they are more likely to have similar values than those not wearing the same brand. so branded clothes have become a distinctive device for consumer groups. yet classic. The Ralph Lauren Polo brand has been particularly successful in defining a specific niche group of customers.

Lexus still positions the brand personality based on the psychological gratification of actual driving and value. This underestimates the need for exclusivity and status as a visible and tangible benefit. Owing a Mercedes or Porsche. says more about who you are than how you drive.com Customers were reluctant to buy and be seen in a car with such a negative social brand personality. It is a ell-built. when they have become old or established they can be easily overtaken by newer. as derived by Mercedes owners. When they are trendy they can enjoy huge sales and success. The car brand Lexus has similar performance. Many companies in the fashion industry try to avoid this by developing diffusion ranges This allows the same company to sell almost the same clothes under a different brand that is fresher than the previous one. but offer small distinctive differences in the consumer’s perceptions. However.2. in a recent J D power car survey the Skoda has performed brilliantly in cognitive tests. Double RL brand and the Polo Jeans co brand. They are classic status symbols that gain most of their value in the public context. The car industry also uses forms of sociological branding to develop distinctive brand personalities. feature or qualities to the Mercedes.skoda-auto. at least in the UK.The danger for sociological pleasure brands is that they may become not trendy.4. The development of the sociological brand pleasure that owners gain is crucial to their success. But it cannot achieve the public or sociological status the Mercedes enjoys. Figure 5 The Skoda Logo Source: www.Cultural brand pleasure 47 . for example. Chaps Brand. The Skoda brand of car suffered from the sociological brand displeasure associated with its car brand. But the biggest task for the brand was to develop its sociological personality. 3. well-featured and good-value car. you can buy blue jeans from Ralph Lauren Polo Brand. Only then would customer acceptance be high enough for new customers to try out the Skoda experience and be proud to be seen in its cars. For example. trendier brands. not its psychological personality. All are parts of the Ralph Lauren company.

For example. The 3 M company. These brands have become a verb or a noun in common usage. Its use of higher cultural values such as associations with the 007 James Bond identity and the use of space age technology help establish the brand personality. Rolex did not invent the wristwatch. for example. e. Potential cultural pleasures and displeasures: Pleasure: -icons -intellectual category leaders -spiritual category leaders -cult identity status Displeasure: . or “ I need an aspirin” Consumers talk about these brands in place of a specific brand that they actually own or desire. Examples of these are Hoover.lack of charisma .ambiguity Idea in practice. They have often invented the technology or have been crucial in implementing it in a new form in marketplace. the Post-it note and Aspirin.followers . 48 . invented and developed the Post –it note. but it has become an icon for the ultimate watch. including examples from the television and airline industries Cultural brand pleasure is often highest among the founders of a product or service category. their brand name has become the category name. Brands that can achieve this kind of cult status enjoy the rewards of a formidable world of mouth marketing campaign. as a generic term. Cultural pleasure brands are often the spiritual or intellectual category leaders. Brands that maximize the use of cultural value are often the spiritual leaders in a business category.g. Competitors have since introduced similar versions but everyone still asks for and refers to simply Post-it notes.Cultural brand pleasure works on the holistic ambience and position of a brand.” To Hoover the room”.spectators .

These brands can be seen as followers. Brands can also become the intellectual leader of a category by developing the cultural pleasure of their brand identity.The Barbour jacket has achieved a high form of cultural brand pleasure in its brand identity. It was the early provider of loyalty cards for customers. Brands may express cultural displeasure and are more open to risks of customers change than those with a strong cultural dimension. In this sense Barbour has become the icon for the category. This requires more than any single product improvement. Manchester United has a strong merchandising approach that covers a large range of goods. at a time when most retailers thought they would be just a passing fad. Tesco has built up a strong loyalty system that gathers information and reorganizes product rangers based on that information. and can best be achieved over time. The UK football team Manchester United has successfully become a cultural brand personality. which coincides with the pay-per-view digital era. It was one the first football clubs to float on the stock market. These brands must concentrate on offering superior prices or service to overcome the 49 . MUTV. rather than any specific price or food offers. When customers do buy the cultural pleasure brand. Customers ask for a Barbour weatherproof . Tesco has continuously shown the lead in developing the highly competitive supermarket business. It has decided to take its broadcasting future into its own hands by launching its own TV channel.. event actually buy an alternative brand. as they usually lack ideas or innovation. but it is Manchester United’s ability to develop as a brand business that is particularly significant. The consumer translates this as a brand interested in the long –term future of him or her as consumer and the category itself. Brands that develop the category as Manchester united has will always be seen as strong because they offer cultural pleasure to the consumer through their leadership. The chain of continuous improvement helps establish the brand as the one that has all the ideas. To gain cultural leadership brands need to define their position as the most innovative in developing the category as whole. The team’s football performance is excellent. the depth of loyalty for the brand is likely to be highest. It is also the first help to build the brand personality of Manchester united as one of the cultural brands of the past 10 years. The TV channel helps build up a total brand experience by matching the games with merchandising interviews and in-depth analysis. It has also introduced clothing ranges to its stores and is the process of developing in-store takeaway convenience food outlets for pizzas and curries. and has been the most financially successfully while many others have failed. It is the combination of high equality service and the process of continuos innovation that leads consumers to respect Tesco as the category leader.

Kogan Page Ltd. In today’s increasingly competitive global markets that agility is being tested to the limits. Coca-Cola’14. Kogan Page Ltd. Kogan Page Ltd. p. The Essential Brand Book. Brands that are slow or uncertain of their own future are unlikely to offer customers strong cultural value.. (1998). Ehrenberg. even though in taste test Pepsi Cola is at least as popular as Coca-Cola.S. The Essential Brand Book. This form of intelligent leadership requires an organization to be agile and confident. A. 50 . 14 Elwood. Pepsi Cola has always struggled to compete wit Coca Cola in the soft drinks market. I. Bibliography: Elwood. (1992). I. This is because Pepsi Cola lacks the essential cultural pleasure that drinkers perceive when they buy and drink ’ the real thing. J. (2002). Charles Griffin.glow of the culturally appealing brands. 174-189. Strategic and Brand Management. Repeated Buying. Kapferer. (2002). Brands that can offer the customers a strong leadership value are more likely to remain competitive.N. For example.C.

com www.ralphlauren. Branding. G.Klein. A Practical Guide to Planning your Strategy. www.com Chapter III Managing the International Brand 51 . Kogan Page Ltd.skoda-auto. Flamingo. Naomi (2003). (2000). No Logo. Randall.

1.1. Brand Planning 2. Observation suggests that this is true for only a few companies. Brand Planning Corporate Strategy and Brands Strong brands are already central to the survival of some companies and are becoming so for others – whether they realize it or not. Branding must be at the center of the board’s corporate strategy. Brand Consolidation 3. not many of them seeing branding as a board.sighted decisions being made that weaken brands. Levels of Branding Decision and Branding Strategies 3. 52 .level concern. There are still too many short.

135-137. The Market Analysis 15 Randall. If promoting individual brands the success may appear later on and companies will find it very hard to support these kind of brands. otherwise there is no chance of widespread common understanding The architecture is the framework in which each brand fits. Market Analysis Brand Planning Brand Analysis Figure 1 The structure of brand planning a. international and local brands: the board must decide which brands can succeed at global level. A Practical Guide to Planning your Strategy. 53 . G. as only the board can guarantee the support and commitment that this requires. these structures make good sense. with associated design of logo and house styles Umbrella and pillar brands: for companies operating on a global or regional scale and having many brands. p. Planning a brand involves first of all a market analysis and then a brand analysis of the future or the already existing brand15. Global. The most large firms have a corporate identity . Kogan Page Ltd. the board must be sure that they are communicated to the whole organization. Every staff member whose work makes any contribution to the delivery of the brand must understand the message from the board as good as possible.. Branding.The top management must agree : • • • The branding model they are using The brand architecture for the company The definition of brand essence for each brand The model must be defined and communicated throughout the company as a basic standard. Decisions at corporate level include: Company brand: the role of the company in the branding process. regional. After stating clearly these directions. (2000).

Honda has achieved world domination in small combustion engines by defining its market as all applications using such motors. In brand planning the manager needs to look at everything from the consumer’s point of view. is not competing in the whole car market. if any? In mature or maturing markets. 54 . for each brand bought.from lawnmowers to generators. Segments What segments exist. Even the most senior managers ought to be exposed to real consumers regularly. but not necessarily to the user of the product or service. where it fits into their lives. One way of defining the market is by asking consumers to state. Buyers and users The marketing management needs to know everything they can about their customers. More difficult-but more important. a sensitive grasp of the segments that either exist already or can be created is fundamental to successful branding. what problems are they using it to solve and what other products or services is related to. what.Market Definition This is the first phase of the brand planning process. The ability to spot the growth of a segment is very important. The brand strength can carry across these various applications. is crucial to brand planning. The other aspect to consider is the brand’s served market. The measurement of brand share and the identification of competitors are both affected by the definition . too much brand research concentrates on attributes that are important to the manufacturer. and what new segments may be emerging.is to foresee how the segmentation will develop over the years. why. when and where? The focus should be on the product in use. including the definition of the market. Basic questions such as: who. what they used it for and when. A profound understanding of how people use the brand. The served market may be wider than the initial market as well as narrower. Such understanding may be based at least partly on qualitative data. on the other hand. and should always be founded on personal experience. Morgan .

as is identifying possible new competitors. this process not assuming necessarily leading the market. new competitors are certainly intending to enter many markets. all the competitors use the same methods and come up with the same results. but on competitors.market competition and a deep understanding of buyers and users.Renault saw the emergence of a niche for a new sort of family car. Quantitative research can measure certain aspects of a brand and in some cases even all the aspects regarding the brand. In the market research area. On the other hand. this process must involve market research as well as internal discussion. too.Renault Espace lead for a long time its segment in Europe. market research can be over-used. Another perspective point shows that relying on consumer research means reacting quite modestly. An important Western player will always be preoccupied to know what the Japanese. the Koreans or the Chinese are planning. After analyzing the market outputs of the analysis should be emphasized in order to begin a draft for planning the brand. in the increasingly business international world. Positioning size. b . 55 .Brand Analysis In the case of a new brand or for a reappraisal of an existing one. or how they really view an existing brand as opposed to how the producer would like the consumers to see the brand. Creativity and innovation will produce the real difference between brands. partly influenced by new laws across several countries on child safety. The purpose of the research at this stage is introducing a “reality check” to see how consumers respond to a concept. Competitors Marketers today need both a focus on the consumers. trend. The danger is that they design all similar brands. Predicting the future moves of your competitor is vital. The outputs are both qualitative and quantitative.

The demands of operational efficiency. relative to competitor brands. but also sporting characteristics. BMW is the car not only with status. in a way that points out key differences. Heinz and many others. there are Perrier. the channel of distribution considerations and competition must be planned carefully and be very balanced. A further challenge is to find a name that is narrow enough to be meaningful without limiting later extension. In services. O course it is preferable that the brand has an important position on the international market.From its popularization in 1970’s. whose design gives instant recognition. Volvo has always positioned itself as the car that is above all. positioning has been an influential idea in branding. the coherence imposed by American Express on its diverse output it is highly appreciated. Many companies use a “positioning statement” in their brand planning. focused whole. The Brand Planning The brand plan should bring together all the elements emphasized in a brand analysis and in the market analysis into a coherent. Packaging For some brands the package is a crucial part of a brand’s identity. The concept refers to placing a brand in the mind of the consumer by the company. their right size in according with the needs of the target market. safe. The main question should imply the mix of products. their right flavors. Apart from the well known CocaCola and Marlboro. Name The goal is to find a name that expresses the brand essence and is memorable and represents an advantage for the product. Lynx. Price 56 .

If it is well used it can introduce excitement and keep the brand in the news. like many others will certainly be copied by many others. Procter and Gamble have adopted a strategy of “everyday low price” to their customers . but be adapted to its local positioning. This causes problems with distributors in the target country and the situation may be also complicated by national or supranational laws or regulations as in the case of pharmaceuticals. Promotion needs to be integrated into the total brand strategy. its price in each country should reflect the overall pricing strategy. It is a signal to the market of the quality and value of the brand and as such it cannot be changed easily. pricing is a strategic decision. with Britain always seeming to be the most expensive-it is said to be known as “Treasure Island” among car manufacturers. although many brand plans will be confined to a single market. Such situations can be dealt with only by offering individual solutions in accordance with each specific situation. A too great discrepancy in pricing will only encourage parallel importers to source the brand from cheap countries to supply high-price markets. International pricing is also an issue. Variations in the retail price of cars in Europe have received considerable publicity. Advertising and Promotion Solid advertising support is essential for successful brands. Competitors The brand plan should explicitly state what competitive actions and reactions are expected and what the firm will do about them. 57 . as many examples have shown. cutting out expensive promotions that can disrupt production flows and confuse consumers.Inside the brand planning process. This provides opportunities to make higher margins in some countries. Sensible brand owners will try to balance the desire to increase margins with the need to offer their consumers value for money. Many plan omit this and managers sometimes seem surprised by competitors reactions. where competition is less stiff or the general price level is higher. Even retailers may have to use advertising in order to change consumers’ perceptions or reposition themselves. This initiative. otherwise it can ruin the brand’s image. They must be thought about and carefully planned in advance. When the brand is sold in many markets.

The next figure shows an outline of the decision-making process in branding. 3. such as sales . The control measures should reflect the objectives the plan aims to achieve. new brand launches . increase in brand preference scores or level customer approval ratings to be achieved..Branding Levels and Branding Strategies There are four levels of branding decisions: (1)branding versus no brand strategy. p. Kogan Page Ltd. market share.Control and Evaluation The last phase of the brand planning should contain control measures so that timely the feedback received after implementing certain measures will signal if results are the expected ones. Generic (brandless) product 16 Randall. G. as long as it covers the main directions of the brand and it coordinates the main processes that sustain its evolution on local and international markets. and the costs of doing so built into the budget 16. A Practical Guide to Planning your Strategy. (2000). (2)private brand versus manufacturer’s brand . not necessarily a very complex one. (3) single brand versus multiple brands and (4) global brands versus local brands.Brands need a planning process. 137.2. 58 . These must be easily measured . Branding.

salt. but that does not mean that every kind of product should be branded. Branding is not a cost-free measure due to the added costs associated with marking.g. As such. cement . These costs are especially relevant in the case of commodities (e.Branding Decisions Private Label Single brand Multiple brand Branded product Single market Manufacturer’s own brand Multiple market Global b Decision Branding versus No brand Local b Figure 2 Levels Of Branding Most products are branded. labeling. 59 . diamonds and other products). Commodities are unbranded or undifferentiated products which are sold by grade and not by brand. packaging and legal procedures. there is no uniqueness.

when applied transforms a commodity into a product (Chiquita Bananas. awareness. not necessarily the best quality or the greatest quantity. is determined by the so. as perceived by the consumers. As an example. differentiation. their brands on products made by US companies. Even though it may seem logical for a distributor to carry the manufacturer’s well-known brand. for example. clarity and carat weight. Branding. psychological or real or imaginary. In general.physical. Nike’s unique designs allowed the company to differentiate its brand from others and to become the top-rated brand among serious joggers. the following prerequisites should be met: Quality and quantity consistency. Dole Pineapples). Distributors in the world of international business include trading companies . Private Brand versus Manufacturer’s Brand Branding used to promote sales or move products needs a further branding decision: whether the manufacturer should use its own brand or a distributor’s brand on its product. From a positive point of view. as evidenced by Matsushita’s purchases of major appliances from White. consumer confidence and brand loyalty.called the four C’s. The value of a diamond.cut. a firm must still find out whether it is worthwhile to brand the product. Probably branding is undesirable because brand promotion is ineffective in a practical sense and adds unnecessary expenses to operations costs. Although branding provides the manufacturer with some insulation from price competition. the value added being given by the certain product attributes. promotion. many distributors often insist on their own private brands for several reasons. First. 60 .other than grade differential. importers and retailers among others. A product is a value-added commodity . The unbranded product is thus vulnerable to any price movement or price cutting. The basic problem with the commodity or unbranded product is that its demand is strictly a function of price. that may be used to distinguish the offerings of one supplier with those of another. resulting in lower production costs along with lower marketing and legal costs. and not by brand. a distributor may be able to create a unique product by bundling or unbundling product attributes and then adjusting the price to reflect the proper value. color. the no brand product allows flexibility in quality and quantity control. Branding makes premium pricing possible because of better identification.

It is believed that private-label products now account for one third of supermarket sales in the United Kingdom and a quarter in France. Second. moving it ahead of Unilever’s Persil and just behind Procter and Gamble’s Ariel which is the market leader. Here in Romania. but not all. Ricoh’s facsimile machines are sold under AT&T’s well-known name. but maintaining brand loyalty and bargaining power without any adverse effect on sales. Carrefour started since 2004 introducing this kind of practice in its stores in Bucharest and Brasov. the retailer J. at least to the distributor. a French retail giant. Third. there are no promotional expenses associated with private branding. By using a private brand. If a firm has any problem with the supplier. it has the flexibility of switching to another supplier to make the identical product. 61 . To remain in business and retain sales to the distributor. Sainsbury PLC has a private brand that is able to win 30 percent of the detergent market. since the distributor can always switch suppliers. Perhaps the most important reason for a distributors insistence on a private brand is due to brand loyalty. In the UK. sells some 3000 in-house products at prices about 15 percent lower than national brands. First. the manufacturer may as well be cannibalized by one of those private brands made by the manufacturer. a manufacturer may judge that the sales of its own product are going to suffer to a greater or lesser degree by various private brands. thus making a strategy suitable for a unknown brand.Carrefour. the manufacturer must compete on the basis of price. In spite of the lower prices paid by the distributor and ultimately by its customers. the manufacturer’s product becomes a commodity. the ease in gaining market entry and dealer’s acceptance may allow a larger market share overall while contributing to offset fixed costs. Distributors can convert fixed production costs into variable costs by buying products made by others. There are a number of reasons why the strategy of private branding is not necessarily bad for the manufacturer. Suzuki cars are sold in the USA under the GM Sprint brand name. In that case. The lower price may also be attributed to the distributor’s refusal to pay for manufacturer’s variable costs . There are also reasons why private branding is not good for the manufacturer. the distributor is still able to command a higher gross margin and than what a manufacturer’s brand usually offers. bargaining power and price.

introduced new products. it has the most to lose . it loses control over how its products should be promoted. If desired. Clearly. But if the manufacturer has superior strength. and appreciation of what constitutes retail image. then the latter may have to use the former’ s brand on the product. if not better than the established manufactured brands. the key factors that have contributed to the evolution of retail brands within British grocery retailing. are changing the basis and use of retail powering the distribution channel. Heinz does make private-label merchandise in the USA. Some branding and manufacturing strategies illustrate the potential benefits and problems of private branding.this fact may become crucial if the distributor does not do a good job in promoting the product. both options can be employed together. launched big capital spending programs and increased advertising. their retail brands are regarded by consumers as being as good as.its brand or a private brand. it can afford to put its own brand on the product and insist that the distributor accept that brand as part of the product. Private branding and manufacturer’s branding is not necessarily an either/or proposition : a compromise may often be reached to ensure mutual coexistence. Heinz makes products only under its own brand because. but most people do not realize that Michelin also produces tires for Sears and Venture. British grocery retailers have successfully managed these factors. as the largest supplier of canned foods there . the manufacturer can be easily be bypassed. The popularity of private brands varies from country to country . Heinz has held down prices. where consumer recognition for its brand is greater than in any other country in the world. for instance. By putting their brands on the products made by outside suppliers. The manufacturer’s dilemma is best illustrated by Heinz’s experience in the United Kingdom. In the UK . Whereas Campbell Soup and Nestle ’s Crosse and Blackwell make some products under private labels. 62 . To preserve its long-term market leadership at the expense of short-term earnings . Its choice depends in part on its bargaining power. the manufacturer has two basic alternatives. As a result. Michelin. Its logic is that the slow growth of US private labeling does not pose a serious threat as it does in the United Kingdom. If the distributor is prominent and the manufacturer itself is unknown and anxious to penetrate a market. Furthermore. centralization of the management activities. where private brands account for 10 percent of US sales. the brand owners are able to take care of the gap in their product lines quickly and economically while solving their inventory problems.By not having its own identity. is world renowned for its own brand.

Single Brands vs. once used together in the public mind.However. which is sold at the upper-medium price range in better stores. Multiple brands are suitable when a company wants to trade either up or down because both moves have a tendency to hurt the company’s main business. There are four recognized branding strategies. the brand is assured of receiving full attention for maximum impact. the company traded up with the Lassale name. Consequently. for different market segments. Citizen. Casio is perceived as a manufacturer of low-priced watches and calculators and its name affects its attempt to trade up to personal computers and electronic musical instruments. with the gold plated Lassale line and the karat-gold Jean Lassale line. Seiko strategy is to deliberately divorce names. has more than 50% of the Swiss watch industry. However. Tissot and Calvin Klein. to appeal to a more affluent segment. Hattori Seiko is well known for its Seiko brand . but they are produced in the USA and the Western Europe and they are sold only through jewelers and department stores. a specific brand is designed for a specific market segment. in its attempt to capture the new youth and multiplewatch owners’ market. trading down without creating a new brand will hurt the prestige of the existing brand. Well informed customers may not find a good reason to pay extra for these brands. Swatch Group Ltd. If a company has a reputation for quality. The watch industry provides a good illustration for the practice of using multiple brands in a single market. Likewise. this strategy will make product differentiation more difficult. Lassale watches have Seiko mechanisms. 63 . Multiple Brands When a single brand is marketed by the manufacturer. Swatch owns a number of well-known brands that include Omega. traded down to include a new brand called Vega. The following three kinds of branding strategies are created in order to be suitable for multiple brands. a company may choose to market several brands within a single market based on the assumption that the market is heterogeneous and thus it must be segmented. Longines. By the same assumption. mass-produced products. trading up without creating a new brand is hampered by the image of the existing products. if a company is known for its low-priced.

Ariel and Omo. it tends to be associated with status and prestige. by definition. Second. with different weights. Local Brands vs. The international marketer must then consider whether to use only one brand name worldwide. A Euro-brand is a slight modification of this approach. The company decided after that study. while reducing advertising costs because only one brand is promoted. Kellogg’s and Cadbury’s. The second category represents another type of branding strategy and it is the individual brand name strategy. Romania including. with an emphasis on the search for intermarket similarities rather than differences. Global Brands When the manufacturer decides to put its own name on the product. For a brand to be global or worldwide it must. using no reference to the corporate name. colors. food and household goods. for a single market. Kellogg’s Frosties. Bata Ltd. flavors and pack sizes. Michael brand for clothing. for example Kellogg’s Healthwise. Individual brand names are used with individual products in a particular market. Coca Cola is a global brand in the sense that it has been successful in maintaining similar perceptions across countries and cultures. to become the official sponsor of World Cup soccer in 64 . making debatable whether a global brand is a practical solution. a Canadian marketer and shoe retailer in ninety-three countries.Corporate umbrella branding is used by firms such as Heinz. The corporate name is used as the lead name for all their products. However. Family umbrella names are used to cover a range of products in a variety of markets. most other brands do not enjoy this kind of consistency. The possibility of having to modify the trademark cannot be dismissed. or different brands for different markets or countries. the problem does not end there if the manufacturer is an international marketer. First.. For example Marks and Spencer use their St. since it is a single product. it achieves maximum market impact overall. A worldwide brand has several advantages. Procter & Gamble and Unilever use individual brand names such as Daz. Range branding is used for a range of products with a particular link in a specific market such as Lean Cuisine for low-calorie foods. A single worldwide brand is also known as an universal or global brand. have a commonly understood set of characteristics and benefits in all of the markets where it is promoted. Kellogg’s Corn Flakes. found out in its research that its consumers generally believed Bata to be a local brand.

The queen of mega brands is Nivea. not helping the development of local competitive capacity. There would be no sense in creating multiple brands for such international products as American Express credit card. Finally. It must be marketed under the same name in at least three different product categories in three or more regions. has been gradually standardizing packaging and product formulas. a company would be wise to extend the brand name to other products in the product line Global Consumer Culture Positioning (GCCP) is a tool that suggests one pathway through which a brand may be perceived by consumers as “global”. Such resentment may 65 . Shell gasoline. a worldwide brand is a good approach when a product has a good reputation or is known for quality. Based on these criteria.order to enhance Bata’s international stature. A mega brand must be available in at least fifteen out of fifty countries that account for 95% of the global economic output. GCCP is an instrument that associates a brand with a widely understood and recognized set of symbols which constitute an emerging global consumer culture. More recently. Time magazine and so on. In contrast. The use of multiple brands is a very common practice. packages and formulas that will appeal to local tastes. In such cases. resulting in no benefit derived from research and development for local economies. developing countries resent international brands because the brand’s goodwill is created by an advertising budget that is much greater that research and development costs . Third. a brand owned by the German consumer products group Beiersdorf. In the case of Unilever. its fabric softener is sold in ten European countries under seven names. wrinkle lotion and bath foam. First. Due to decentralization. after-shave. For Bata and others it is easier to achieve worldwide exposure for one brand than it is for multiple local brands. This skin-care brand is a huge success and the brand has been extended to at least nineteen product categories-shampoos. In addition. the multinational firm allows country managers to choose names. the mega brands are dominated by the highly extendable personal care and cosmetics manufacturers and by food and drinks manufacturers. the company. a worldwide brand provides a convenient identification and international travelers can easily recognize the product. local consumers are forced to pay higher prices for advertising. ACNielsen’ s Global Mega Brand Franchises report uses a number of criteria to identify mega brands. There are several reasons for using local brands. while keeping local brand names. Coca Cola does not have this power of extendability.

In such 66 . Second. This approach is sometimes mistaken for a single-brand approach when in fact a new brand is created. Third. not by designed but by necessity. Antitrust problems can also dictate this strategy. The eight and perhaps most compelling reason for creating new local brands is because local firms may have already used the names that multinational firms have been using elsewhere. Translation may also make a brand more meaningful. Gillette. it should consider local brands. Then. multiple brands may have to be used. worked with Playtex to create different appropriate names for Playtex’s brassieres in different languages. consumers avoid buying a certain brand when it is difficult to pronounce. after acquiring Braun A. By considering foreign tastes and preferences.G.explain why India’s ministries. which had little success. Close up ( toothpaste) was translated as Klai-Chid ( literally meaning “ very close”) in Thailand. Renault would have been foolish to abandon the AMC (American Motors) name after a costly acquisition. The result was Wow in England and Traumbugel ( dream of wire) in Germany. Sixth. when the manufacturer is unable to ensure uniform product quality across countries. Seventh. Thus Renault 9. One problem is the restrictions placed on the usage of certain words. rejected Pepsi’s 35% Pepsi-owned joint venture. Diet Coke in countries that restrict the use of the word diet becomes Coke Light. not to mention money. Sometimes. Chrysler subsequently bought AMC from Renault. one reason being AMCs coveted Jeep trademark. the translation retained the meaning and the logo of the brand as well as the package design. an international advertising agency. had to sign a consent decree not to use the name in the US market until 1985. for example. Pepsi introduced a non-cola under the Patio name in America but under the Mirinda elsewhere due to the unpleasant connotation of patio in Spanish. which otherwise would be needed to build the recognition for a new. a German firm. due to legal complications. Grey. a local brand can avoid a negative connotation. some MNCs acquire local brands for quick market penetration in order to save time. responding to domestic soft drink producers‘ pressures. a local brand is more easily understood and more meaningful for local consumers. became AMC Alliance in the USA. when an existing brand is difficult to pronounce. unknown brand in local markets. a company achieves a better marketing impact. a new brand may be desirable. Fifth. The decree forced Braun to create the Eltron brand. because they want to avoid the embarrassment of a wrong pronunciation.

although the McDonald’s logo is one of the most recognizable in the world. Budejovicky Budvar Narodni Podnik. Anheuser-Busch bought the American rights to the Budweiser name and recipe from the brewer of Budweiser in Czechoslovakia. In an interesting case. however. Each strategy has its merits and serves its own useful functions. a brand standardization is a common strategy. instead of buying a locally produced product or one from an authorized distributor/importer. for example. a local retailer can buy exactly the same brand from wholesalers in countries where prices are significantly lower. holds the rights in Europe. 67 . perhaps the only market in the world which receives this special treatment. This is where managerial judgment comes in. considers consumer responses to a particular brand mix. France and several European countries. Interestingly. Price control is also one reason for the growth of the so-called gray marketers. As mentioned above. The most well-known logo in Quebec is J’M. Operating from the town of Ceske Budejovice.a case. are another story. Companies tend to brand globally but advertise locally. especially in EU countries where products are supposed to be able to move freely. A manufacturer will have a hard time prohibiting importation of gray market goods. known as Budweis before World War I. The southern half of Europe uses mainly oil for cooking rather than margarine. but Anheuser-Busch has to use the Busch name in France and the corporate name in other parts of Europe. the Czech brewer. where Sure is Procter Gamble’s deodorant trademark. Courts have ruled that both companies have the right to sell in the United Kingdom. Parallel trading can be minimized by having different national brands rather than only a worldwide brand. Food products. to buy the right to use the name from a local business can prove expensive. Thus. McDonald’s has changed its advertising logo for Quebec. This problem is especially acute in countries with inflationary pressures. this brewer claims exclusive rights to the Budweiser name in the United Kingdom. Ninth. It uses an international brand for such products as detergents and personal products because common factors among countries outweigh any differences. The strategy of using a worldwide brand is thus not superior ( or inferior) to using multiple local brands. Unilever. Food markets are much more complex due to the variations in needs and responses to different products. Unilever markets Sure antiperspirant in the United Kingdom but had to test market the product under the Trust name in the USA. a local brand may have to be introduced due to price control. This is a play on “ j’aime” which means “ I love” in French. as the phenomenon contributes to price variations among countries for the same product.

companies have three translation methods to consider : phonetic ( i. Markets are actually different Market shows different preferences. Strategic and Brand Management. 68 . Soup is lightweight precursor to the main dish in Great Britain but can almost be a meal by itself in Germany. when compared to British home makers.really understand them.e. When the phonetic naming method is used. The effectiveness of translation depends on the emphasis of the original English name and the translation method used previously for brand names within the same category.e. it is an additional argument for treating each local market as unique. and even if some of this is due to past government action. semantic ( i.white fats. Under such circumstances of preferential variations. Kogan Page Ltd. (1992). p.e. and only they – in the local country. are more interested in health and diet products. brand name evaluations are more favorable for names that emphasize an English word than for those names that emphasize a Chinese word17. by meaning). by sound ). or butter. by sound and meaning). Pasta is seen as old17 Kapferer. Arguments against globalization Those who oppose global branding base their arguments on fundamental marketing principles: it is the job of marketing people to be sensitive to their customers and consumers. J. German home makers. When creating local brand names in the multilingual international market.N.210-224.. The French more than the Dutch consider butter to be an appropriate cooking medium. the potential for local brands is greatly enhanced. and phonosemantic ( i.

. This seems a convincing argument. but it is not clear how many companies actually work that way. but rather trendy in many other countries.but their current situation may still vary widely. Local markets have different histories and structures The development of particular product markets will have different histories in every country. it will end up with a compromisesomething bland that offends no one but delights no one either. a standardized strategy makes no sense. Branding.fashioned in Italy.usually because of the actions of the major multinationals. If a company tries to take all these differences into account. goes the argument. There must be some sensible compromise between taking all national preferences into account and ignoring them completely. is thought to be intimately bound up with local culture. Examples of products that are free of such associations are consumer electronics: we use a VCR in the same way regardless of our nationality and background. 126-130. In such circumstances. The brand share of even a leading global brand will vary across countries. Culture-bound and culture free Products are said to be the culture-bound if their use is intricately tied up with some aspect of the country’s culture. Brands designed internationally are the lowest common denominator. There may. G. p. The biscuit market shows quite different patterns in different countries. on the other hand. and indeed at first sight local markets for good products do vary hugely18. Kogan Page Ltd. Food. (2000). for example. be a very strong local competitor with an entrenched position. A Practical Guide to Planning your Strategy. 69 . 18 Randall. They may be converging.

do enjoy economies of scale and are culture-free. so global brands are feasible. 127. we must look at the evidence of Coca-Cola and McDonald’s. as in figure 1. VCRs. Yet. 70 .HIGH ECONOMIES OF SCALE LOW VCR FOOD High Low Cultural grounding Figure 3 Types of Brands Source: Randall. If the culture variable is combined with the availability of economies of scale. Branding. it is however difficult to establish global food brands. A Practical Guide to Planning your Strategy. however. What is more difficult is to predict the dynamics of change: how quickly will convergence happen. both global brands. G. and what effect will the activities of global brand marketers have. Kogan Page Ltd. p.. How it has gone in a particular case will need to be determined by analysis. (2000). we see that food has low economies of scale and is culture-bound.

as do Japanese consumers products such as electronics and cameras. Arguments for a Global Strategy19 Going global is always going to be expensive and difficult.advertising agencies. For many service firms whose clients are international. and consumers are buying into a small piece of the American way of life. but for others their country of origin is significant.Country of origin We have been talking of global brands as if they were stateless. 71 . Any firm that wants to serve the biggest 19 Randall. Kogan Page Ltd. p. Perhaps some are. if they are known to b international. luxury brands from France.a global network is becoming a necessity. 124-126. is the real challenge in the future for aspiring global brands.Coke. Some brands seem local. A Practical Guide to Planning your Strategy. the reasons are various. For example. many famous global brands. Many people in Britain will have thought of Ford. consultants.could only be American. McDonald’s’ Levi’s. but seems a prize worth aiming for. Marlboro. G. Vauxhall or Hoover as British. to have the authority of internationally acceptable brands while appearing local enough to be “ what we want here”. Italian fashion brands such as Gucci would be less powerful if they came from England. accountants. (2000). This. say some. thought they are all American in origin or by takeover. have a unique cachet that comes from their origin. Branding.. both haute couture and drinks such as cognac and champagne. Their “American-ness’ is an essential part of their appeal. German cars and industrial engineering products gain an additional value from their origin. Likewise.

Procter and Gamble found that. some successful brands were not introduced into major European markets for up to 12 years after their initial launch. Competition The fact that competitors are going global is undoubtedly a challenge. The first mover advantage may also be lost. Firms risk being left behind. leaving the firm playing catch-up in too many important countries. A firm may have to compete on a global scale. Economies of scale 72 . Profit opportunities If successful brands cannot be transferred rapidly to as many markets as possible. Making this judgment demands a high degree of objectivity. profit opportunities are foregone. caught in a cycle of increasing threats and decreasing opportunities. without central control. and the commitment to maintain the advantage against imitation and attack. either to defend its domestic market against global competitors with scale advantages or to take advantage of new opportunities in new markets before competitors establish themselves. or to develop alliances with other firms to provide global reach. facing only decline. How do they know they will succeed? Sustainable competitive advantage The firm must be absolutely clear that the brand has some differentiating advantage over the competition it is likely to meet in all its markets. But going global is also risky.clients has been forced to set up local offices around the world. these are all very real pressures. Strategically.

but the lowest-commondenominator danger must be avoided. but the total brand must be taught through. often consistent ones. the segment does not have to be the same size everywhere. that is. Exactly where this should be will depend on the market.The production cost function is not always linear.must be developed. In a global. mix. 73 . cost do not necessarily fall steadily at the same rate as volume increases. multiproduct firm. point of difference.and unfortunately failures that have apparently done everything Develop the brand strategy in one place The total shape of the strategy – essence. The drivers may be technological or market led. they must be kept in mind. and it makes sense to use that to advantage. where it ought to have most knowledge and understanding. costs will be at a level that allows the company to compete with rivals. It must be clear that when the planned. There will always be counterexamples of successful brands that have followed different rules. that may not apply to all product fields. where costs rise steeply in the short term as production is raised to a new level. and there are two other criteria. This does not mean that consumers in the global market place should be ignored. The first is the location of the expertise: some country teams are better than others in certain product fields. This needs to be done with a concrete set of consumers in mind. Going from a multi-country to a global operation is impossible without radical changes in the organization. positioning.or desiredlevel of international sales is reached. Frequently it is the company’s home market. target segments. As it was noted above. but it must be big enough to support the brand in enough markets. identity. and it seems to work best if it is done in one specific place. The First Steps There is of course no magic formula for developing a global brand. There are likely to be steps. values. but evidence suggests that some approaches offer better chances of success than others do.

which means “does not go” in Spanish. as we have seen. that are: 1.is intimately bound up with that. that is. adaptations should be accepted only on the most compelling evidence.a short. The only absolute barriers are those that cannot realistically be overcome in an acceptable time-scale. Only the brand essence and expression are fundamental.• Check against all important target markets The brand strategy must be checked for major negatives in the markets that will account for the majority of sales. Have no negative connotations in any language 3. If an ideal brand name is four letters long.which should state how the brand essence is to be communicated to the target audience. The days when George Eastman could invent “ Kodak”. for example: • • • • Consumer taste that is likely to resist short-term change Entrenched local opposition that will fight back strongly against the most determined attack Government regulation that cannot be altered Lack of existing suitable distribution channels Check elements of the marketing mix for major markets All elements of the marketing mix should be checked. Words or even phrases that can be translated may be a better 74 . though the advertising strategy.and take it all over the world. • Choose a suitable name The name is central to many brands. against the need for unavoidable adaptations. Pronounceable in all languages 2. Are at least not inconsistent with the brand essence There are many examples of names that turn out to have unfortunate meanings in some other languages: the most printable is the Vauxhall/ Opel Nova.The best a man can get. meaningless name. if one best strategy has been developed. memorable. may be over. again in the major markets. but it is becoming ever more difficult to find suitable global names. then there are very few words left that are suitable. minor variations in the physical product need not detract from a consistent brand proposition. Truly global brands such as Gillette Sensor have a global advertising platform. The brand essence is the key. Are memorable 4. On the argument rehearsed above.

some at niches.3Brand consolidation Frequently. some perhaps as fighting brands. Such clarity will help reduce unnecessary and wasteful overlap and should sharpen the focus of each brand. for example. The other gain from such an exercise is clarifying the exact function and objective of each brand. though it is probably also worth trying an existing name even if at first sight it causes problems. Dove soap was launched in many countries.which can then be spread to other new sub-brands as they are launched. Some. and turned out not to be.” From the Elida Institute”.bet. positioned against the own label.which seemed hardly appropriate. For example. low price. But local managers felt that this was not a barrier. Unilever is using the “ Elida Institute” as an umbrella for hair care brands and the “ Pond Institute” for skin care. like “ From Laboratories Garnier” is a tag line in each brand advertisement that will gradually establish the pillar brand and its values. Despite the advantages offered by the multiple-brand strategy.low cost. it is either by accident or lack of coordination that multiple local brands result. • Select countries for launch and roll-out Either way. may be destined to be global brands. but the company was aware that the world in Italian means “where”. the cumulative effect should be greater than totally separate brand spending. it may be desirable to consolidate multiple brands under one brand when the number of labels reaches the point of being cumbersome or confusing. Some will be aimed at the number on or two spot. other regional or local. National Bank Americard used to issue cards around the world twenty-two names 75 . 3.

the process is complex and extremely costly on an international scale. and food products under numerous names. soap ( Dove. Its Eterna brand. When a marketer wants to change brands or consolidate them under one brand in order to unify all marketing efforts. such a change is fraught with pitfalls and. will suffer the same fate. production. a top selling toiler tissue in England. if not well planned and executed. this portfolio of 1600 brands. In this situation.before consolidating them all under the Visa umbrella. Elizabeth Arden. Unilever markets a vast array of beauty. and other related issues. New York: Wiley. Lever 2000. Q-tips. p. Some of the its well-known brands include: ice cream ( Breyer’s Good Humor). Aim). evolutionary process in preparing its European brands fir 1992. Even Andrex. and that brand was eventually sold to another company. thus diluting or destroying the goodwill that has been earned. Its packagedesign unification involves having the Nestle name appear along with the local brand. M. Caress. AssuaghSSIH weeded out all but its most prominent watch brands. As in the case of Scott Paper Co. complicating communication for the company. 169-171. Elizabeth Taylor ). fragrances ( Calvin Klein. communications. global branding would allow Scott to use common advertising messages internationally saving costs. Another kind of problem presents when a brand is well known but the corporate name is not. In addition. the company felt that the Scott name. Although a unified brand across frontiers provides cost savings by eliminating duplication of design and artwork. for example. was never marketed in the USA. Another way of consolidating the brand franchise is simply to drop weak brands. Pond’s). hair care ( Suave. Lifebuoy). However. and personal care ( Vaseline.Unilever has decided to focus mainly on some 400 brands while eliminating up to 75 percent of its products20. So. can cause more problems that it solves. Nestle uses a gradual. has proven to be unmanageable. So the company has been phasing out local brand names in its eighty national markets. (2003). it is probably easier to change the 20 Levine. oral care ( Close-Up. should command respect all over the world. Pepsodent. A Branded World: Adventures in Public Relations and the Creation of Superbrands. home-care. Thermasilk). 76 . although well recognized. just like Coca-Cola. distribution. Brand consolidation on a global scale is a strategy that has been debated. The Nestle name will be gradually enlarged over a period of four or five years until it replaces the local brand names entirely.

was risky because it followed an opposite route. p. Some critics questioned the move because the change cost Nissan $ 150 million. however. (2002). The strategy is even riskier for fashion products because fashion comes and goes. Firestone is a prime example of how a brand could damage the same corporate name due the accidents caused by its tires. 77 . years of good-will gained from the Datsun name would be lost. Brand consolidation is never an easy process. It is debatable whether the corporate name and the product’s name should even be he same. Kogan Page Ltd. The decades-old Amoco torch has been replaced by a new. 21 Elwood. especially when well-known brands have to be replaced. When the name is the same. Nissan’s name change. To minimize this problem. I. The remodeling of all 19. BP Amoco has rebranded Amoco gas station to erase the Amoco name from all 9000 stations in the USA. The Essential Brand Book. is a relatively safe strategy and should work well if a firm has good quality control and the reputation of its nonfashion products has withstood the test of time. Its initial TV commercials and print advertisements emphasized that Datsun was a product of Nissan21. Furthermore. lower-case BP logo and go eighteen-point green and yellow sun.5 billion over four years.000 BP stations worldwide is expected to cost up to $4. since the images of the corporation and the product are so intertwined. Olympus and Amoco. Nissan’s half-hearted entry into the US market led to the use of the Datsun name to avoid embarrassment in case the effort failed.corporate name to fit the better-known brand name. Because of BP’s acquisition of Amoco. the company was also unhappy that the proud corporate name was not as widely recognized as its Datsun brand.217-231. The company decide to institute a worldwide brand by phasing out Datsun and phasing in Nissan. Aprica. in comparison. Using the same name. which enjoyed an 85 percent recognition rate in the USA ( compared to 10 to 15 percent for Nissan). a brand that performs poorly or gains notoriety through bad publicity hurts the corporate image as well. However. both Nissan and Datsun names appeared together at first. a strategy used by Sony. The 1725 recently acquired Arco stations are keeping the Arco name.

Kapferer. J. (2002). 78 . (1992). Kogan Page Ltd. Kogan Page Ltd. The Essential Brand Book.Bibliography: Elwood. I. Strategic and Brand Management.N.

Kogan Page Ltd.Levine. Randall. A Practical Guide to Planning your Strategy. (2000). New York: Wiley. M. A Branded World: Adventures in Public Relations and the Creation of Superbrands. Branding. The Global Brand 79 . (2003). Chapter IV Vodafone. G.

International Presence Vodafone Group Plc provides an extensive range of mobile telecommunications services. 80 . The case for a single brand 4.The strategic context 3.1.1. International Presence 2.

The Group’s mobile subsidiaries operate under the brand name ‘Vodafone’. The Company had a total market capitalization of approximately £93. the United States and the Far East through the Company’s subsidiary undertakings. the Group has also entered into arrangements with network operators in countries where the Group does not hold an equity stake. as a first stage22. In the United States the Group’s associated undertaking operates as Verizon Wireless. the United Kingdom. Under the terms of these Partner Network Agreements. Based on ownership interests at 31 March 2005. During the last two financial years. there were approximately 431. the Company. At 31 March 2005.com 23 81 .8 million total venture customers In addition.7 billion at 12 November 2004. the Company has Partner Networks in a further 14 countries23. The company’s ordinary shares are listed on the London Stock Exchange and the company’s American Depositary Shares (‘ADSs’) are listed on the New York Stock Exchange. the Group and its partner networks co-operate in the development and marketing of global services under dual brand logos.vodafone.including voice and data communications.8 million registered customers calculated on a proportionate basis in accordance with the Company’s percentage interest in its ventures. had approximately 154.vodafone. Summary of Group mobile telecommunications businesses at 31 March 2005 Country by 22 Percentage Venture Venture Registered Registered Names of ownership customers customer proportionat prepaid www. with a significant presence in Continental Europe. associated undertakings and investments. associated undertakings and investments. through its subsidiary undertakings. and is the world’s largest mobile telecommunications company.com www.

9 Portugal Sweden Belgium Kenya France(7) Poland Romania South Africa(8) Total Americas United States(9) 44.region (1) (3) (2) growth (4) e customers (000s) 27.280 15.9 50.8 100.360 5. 3 Go Mobile KPN Mobile.735 1. MTN Orange.0 Switzerland 25. O2.472 648 2. Sunrise. T-Mobile TIM.011 1.952 167 3.0 43.8 100.0 45.586 1.324 52 92 61 E-Plus.1 35.793 3. Wind.0 35.010 5.443 1.454 53 97 85 66 76 72 90 56 78 38 60 98 45 53 65 87 36 64 Amena. 3 BASE (KPN).087 993 48. 82 . 3 Other EMEA Spain Albania Egypt Greece Hungary Ireland Malta 100.072 3. Tele2 Netherlands 99. Cosmorom.971 87.023 15. TIM Pannon GSM.004 1. Tele2.0 99.9 19. 3 Orange.541 4. ERA Orange.293 2.0 100.4 100.0 76. T-Mobile Meteor.136 4. T-Mobile.789 3.996 1.452 17 20.073 879 7. Telfort Optimus. Mobistar (Orange) Kencell(12) Bouygues.0 11.1 99.586 1.173 5 National operators(10): Cingular Wireless. Q-Telecom.6 99. Orange.646 18 23 44 9 21 5 4 11 10 7 (1) 64 11 28 37 59 3 22 11.0 100.969 7. TMN SpringMobil.0 25. TMobile.735 1. Orange Centertel. O2.223 17. Telia.324 competitor (5) network operators (6) (000s) (%) 9 6 9 (%) Germany Italy UK 100. O2. Telefónica Móviles AMC MobiNil Cosmote.541 1.223 22.0 27.952 167 3.502 15. Zapp Cell C.513 15.482 3.472 649 4.0 100.

891 76 6.Nextel(11). United States – Verizon Wireless. Romania – Connex. Fiji – Vodafone.692 2.692 431.994 26. Ownership interests have been rounded to the nearest tenth of one percent.7 100. Switzerland – Swisscom Mobile. TMobile Asia Pacific Japan Australia New Zealand Fiji China(13) Total Group Total 97.041 2. in territories where 83 .891 155 213. Telstra. Poland – Plus GSM. 3 Telecom.0 100.NTT DoCoMo. France – SFR. Kenya – Safaricom.731 1. South Africa – Vodacom.874 233. China – China Mobile. Orange. Sprint PCS(11).3 15. China Telecom.0 3.731 1.com (1) All controlled networks operate under the Vodafone brand. (2) All ownership percentages are stated as at 31 March 2005 and exclude options.838 11 69 78 93 72 68 61 au.384 154. TelstraClear China Netcom. Networks in which the Company does not have a controlling interest operate under the following brands: Belgium – Proximus.vodafone.0 49. Tu-ka Optus. China Unicom Figure1 Summary of Group mobile telecommunications businesses at 31 March 2005 Sourcewww. (3) A mobile customer is defined as a subscriber identify module (“SIM”) or. warrants or other rights or obligations of the Group to increase or decrease ownership in any venture as detailed in “Operating and Financial Review and Prospects – Liquidity and Capital Resources – Option agreements” and also exclude the conditional agreements to acquire controlling stakes in MobiFon and Oskar as detailed in “Business Overview – History and Development of the Company”.839 1 10 18 36 42 38 27 14.

customer growth in the financial year includes 2. but are not limited to. Hence. in addition to the national operators shown. In the United States.645.emergency response applications in vehicles).000 venture customers which had previously been excluded from the Group’s customer base. (6) Table excludes MVNOs and other competitors who do not operate a mobile telecommunications network. the Group’s associate in France had subsidiaries in La Réunion and La Mayotte. However. asset and equipment tracking and mobile payment / billing functionality (for example. Hence. (4) Venture customer growth is for the twelve month period to 31 March 2005 (5) Prepaid customer percentages are calculated on a venture basis. Customers in these subsidiaries have been included in the Group’s customer figures since September 2004. there are several regional and numerous local operators. At 31 March 2005.6% at 31 March 2005.000 customers in respect of these subsidiaries. 84 . Telemetric applications include. (10) This is not a full list of US network operators. a unique mobile telephone number which has access to the network for any purpose (including data only usage) except telemetric applications. customer growth in the financial year includes 515.000 customers in respect of these subsidiaries. this proportionate ownership will vary slightly from period to period depending on the underlying mix of net additions across each of these networks. the Group’s proportionate customers included 226. In the absence of acquired interests. (7) At 31 March 2005.SIMs do not exist. the Group’s proportionate customers included 594. (8) At 31 March 2005. Mozambique and Tanzania. Lesotho. the Group’s associate in South Africa had subsidiaries in the Democratic Republic of the Congo.0%. vending machines and meter readings) and include voice enabled customers whose usage is limited to a central service operation(for example.000 venture customers which had previously been excluded from the Group’s customer base. the Group’s proportionate customer base has been adjusted for Verizon Wireless’s proportionate ownership of its customer base across all its network interests of approximately 98. At 31 March 2005. Customers in these subsidiaries have been included in the Group’s customer figures since September 2004. (9) The Group’s ownership interest in Verizon Wireless is 45.

Sprint PCS and Nextel announced their intention to merge. everything we do furthers our desire to create mobile connections for individuals.831.000 venture customers from the acquisition of Chinese provincial network operators in the year.vodafone. results and the world around us24. more than 50% of the cash they have generated. they intend to expand this share purchase programme further. Our commitment to this industry is underlined by our company values. businesses and communities. buying back shares worth £3 billion and returning.Provide superior shareholder returns The continued strength in their financial performance enables them to increase returns to their shareholders on an ongoing basis.vodafone.The strategic context According to Arun Serin.(11) On 15 December 2004. our people. through their dividends and their share purchases. Our Vision is to be the world’s mobile communications leader and we’re delighted by the prospects for the future of our industry. (13) Customer growth in the financial year in China includes 26. (12) The Kenyan Government has awarded a third license but the operator had not commenced service at 24 May 2005. the present Chief Executive of Vodafone: “At Vodafone.com 85 . 24 25 www. In the next 12 months.2.com www. 4. During 2004 they have done this through increasing their dividends and their share purchase programme. This merger is subject to US regulatory approval.” The success of Vodafone’s effort requires a commitment to deliver on their six strategic goals25: 1. which state that everything we do is driven by our passion for customers.

Operating in 28 markets puts them in an enviable position to leverage their global scale and scope. acquisition and scale decisions. Vodafone has done a great job of building brand awareness as they have moved towards a single global brand. they want people to understand that the Vodafone name represents great service. where they are aiming to attract even higher market share.Delight their customers Vodafone has rededicated themselves to delighting their customers because they believe this is the foundation for their continued success. Key to delighting the customers is the ability to deliver superior voice and data services according to differing customer needs.By delivering on their goals and conducting rigorous economic and financial analyses before making pricing. They recognize that every customer interaction provides another opportunity to win loyalty and that’s why they continue to raise standards on the quality of customer care in the call centers and their stores and the quality of the networks. they demonstrate the discipline to always act in the best interests of their shareholders. 4. They are using this advantage to deliver exceptional 3G-based services. 2.Leverage global scale and scope Another unique advantage for Vodafone is the expansive global footprint. Throughout the past few years. great value and great innovation. 3. Beyond brand awareness. In the productivity areas they are 86 . Another competitive advantage is their leadership position on cost and time to market. They continue to build productive strategic relationships in the mobile environment.Expand market boundaries Expanding the market boundaries is another priority for Vodafone. When Vodafone becomes synonymous with these attributes they will achieve brand preference and expect to see their market share climb as a result.

if they make sense both strategically and financially. 26 Gilmore. notably in Australia and some minority stakes in other markets. 6. they have recently taken a big step forward in the music arena through the agreement with Sony Music. But there were signs that this was changing and the marketing team commissioned a strategic review to assess the international market26. 139. However. opportunities to expand geographically will continue to present themselves and. They are working hard to make sure their employees have the right skills and knowledge to anticipate their customers’ needs.Build the best global Vodafone team As the business expands and the environment around Vodafone evolves. 5. recruit and retain the people that will lead them into this new world. They are committed to the highest standards of business integrity and governance. Be a responsible business As a large. Warriors on the High Wire. In their changing industry. There were relationships with overseas cellular phone operators in order to provide access for Vodafone’s customers in those countries. 87 . Their businesses around the world are important to the infrastructure of the economies and societies they serve and they take our broader corporate responsibilities very seriously. (2001). In 1997 Vodafone was already established as the market leader in the UK and had some presence overseas. they intend to give them serious consideration. Being a responsible business is about the way they manage their impact on society. multinational company Vodafone inevitably raises expectations amongst all their stakeholders. the environment and the economy. it is crucial for them to develop. In the content areas. Harper Colling Business. F. in general the global market for mobile telephony was organized on largely national lines ( like the fixed-wire market). p.working with Microsoft and other IT companies.

would be extended with the third generation of mobile phone licenses so that the company could envisage world service provision with new applications and products. The new technical standards would also enable a whole range of new non-voice services for both businesses and the individual. particularly in the data field.were ambitious to grow beyond their national boundaries. which are generally the most profitable. This would extend the advantage of international roaming which was already available through GSM. this phenomenon was only happening in the US in 2004. invest in research and development. it was known that such licenses would not be cheap. the process of international standardization. In addition. it was clear that demand for mobile communications showed no signs of slowing and had made a breakthrough in popular culture. they were able to use their buying power to reduce the cost of equipment purchase and in R&D there was a huge amount of duplicated 88 . These two capabilities when combined with a global presence. Vodafone sensed a changing marketplace in which there would be only a few really successful global players. would enable a globally competent and capable operator to differentiate their services for the corporate user. In procurement. in order to maintain customer loyalty and to recruit new customers. The next generation mobile phone licenses were not far away and this would provide them and others with a potential means of entry. It had changed the way people conducted their lives and was a highly desired service. maintain their infrastructure and continue with appropriate investment in marketing. which had already occurred with global systems for mobile communication (GSM). In Europe. particularly in procurement and in research and development. This included the potential for making a reality of Internet access and other data services for wireless users. The team identified significant synergies in this changed scenario. In some ways. as well as optimizing their position with the higher spending and increasingly internationally mobile consumer market. who would require access to capital markets and strong on-going cash flow in order to be able to purchase the new licenses. Although Vodafone did not know at that time that they would largely follow the UK model of an auction. The company’s strategic analysis also showed that the major fixed-wire telecom companiesmany fairly recently privatized.From a technical standpoint. speed and capacity of the technical standards for the new generation services would satisfy the demand for the new generation services would be substituted for fixed line capacity for consumers. the spectrum. which would give advantage to the global player.

This enabled Vodafone to gain control in places like Netherlands and Greece. embarked upon a three-way growth strategy. Mannesmann had been a partner with AirTouch for some years and the two companies had shareholding in mobile phone companies elsewhere in Europe. but more importantly their work 27 Gilmore. Finally. The first acquisition was AirTouch. This was an agreed deal. their partners were not in cellular phones as a core business. To achieve their ambition to become a global player. Mobifon. through investment both in their marketing capability with their own retail outlets and in non-specialist multiple retailers. to become a true global player there were needed major moves and this is the strategic context of the two large acquisitions undertaken by Vodafone in the period of less than a year. which they knew would take time to develop and eventually provide sustained growth and enhance margins as Vodafone moved up the value chain. They had to do something and not allow the European infrastructure to be taken over by a competitor. a major UK competitor with some presence in other markets. including the Romanian player. although there was stiff competition from Bell Atlantic and the wireless interests of GTE to create the leading operator in the US with over 23 million customers. which interests in both fixed-wire and cellular phones. they decided to accelerate growth in their existing markets. Hutchinson Whampoa. the owner of Orange. a single digital technical standard and a presence in forty-nine out of the fifty markets. through the active promotion of prepay products aimed at the customer.effort in developing and introducing new services.p-140. they started working on non-voice services. Warriors on the High Wire. a significant cellular phone operator on the West coast of the US with the added benefit of a number of stakes in mobile phone companies in Europe. but recognized that this area would require much more detailed work before they could be accurately quantified. they evaluated a number of options. (2001). Soon after the completion of this transaction. Harper Colling Business. they aimed to become a global business so that they could optimize services to customers and differentiate themselves from regional and national players. First. Secondly. a German conglomerate. Vodafone therefore. More importantly. They also consolidated and developed their brand identity in each of all their territories. They identified some possible synergies in marketing.141 89 . In some cases. However. F. sold its shareholders to Mannesmann. They were also successful in bidding for new licenses in countries such as Egypt and in making individual country acquisitions such as in New Zealand27. but were hoping to enjoy a good investment return when they exited.

primarily due to market structure. Across Europe. Usually. This had led to a market structure where the old PT business was the safe. where the old state-run PT was hugely inefficient. governments had allowed their own post office telecom (PT) to be either the first or joint first cellular phone company. The battle for Mannesmann had left some bruised egos. but still. 90 . who have been invaluable in managing the brand repositioning project. This happened in Italy. had an outstanding brand image with a reputation of service and innovation. Vodafone needed a more detailed appraisal. I. these similarities were substantial and fundamental. The company that Vodafone owned. leading to high penetration of mobile phones and a very weak brand image for its own cellular phone brand. every country management team is anxious to point out the unique features of their market of their business. with a similar 28 Elwood. steady company and the Vodafone brand was seen as the “challenger” brand offering perceptions of modernity. 238-241. The Essential Brand Book. Springpoint was helpful in focusing everyone on the similarities between countries. in the US and in a number of other markets. Omnitel. different product mixes and different histories. p. not the differences. All had different names. freedom and innovation.. The enlarged group had subsidiaries in all the major countries in Europe. and ultimately their shareholders. when multinational research is undertaken. (2002). different profiles. Most of Vodafone’s companies also had strong brand images. In fact. where there were some concerns that the British-based company was about to endanger their brand heritage and positioning. They undertook a major research program in all Vodafone’s major markets to understand the existing brand franchise and positioning in each market. Kogan Page Ltd. the confidence to move on with the first contested bid in German history28 The groundwork for a branding strategy As it was mentioned earlier. Vodafone immediately approached brand consultants Springpoint.on synergies gave them. to assist them in this work. there was some initial work on the possible marketing synergies from the enlarged business. particularly in Germany.

new services being introduced. in the UK. since they would be responsible for implementing their strategy. Harper Colling Business. our local management were fiercely proud of their local brands. In many cases they had been there from the beginning. As one manager of Vodafone said: “ We changed the shape of this industry…we made a huge number of innovations in marketing. The bruises of the battle for Mannesman left some degree of suspicion of the corporate management and their intentions.vocabulary. products. At the same time. Perhaps more importantly. In a number of countries they described their battle with the established giant PT company as “David versus Goliath”. p. 143-144. services. We made it possible for everybody to buy a cell phone. Vodafone’s home market. It was also clear.” 29 Gilmore. so there were no weak links. Some quotations surprised in any environment today bring this to life: “I couldn’t cope without it”. And the people in the company are proud of that and proud of working for the company29. this was for reasons of history and in part because Vodafone had deliberately built a strong franchise in the corporate segment of the market where they found. as the challenger brands. with Orange and One-2-One. new payment methods and new entrants. technology. takeovers and alliances as part of everyday life. They also saw change as a constant feature of their market. They had seen massive innovation in terms of physical products. “I don’t know how I ever managed before”. it was also apparent that the mobile phone had become for most users an indispensable part of their everyday lifestyle: it was something that they could not do without. that. because mobile telephony is a new young market. historically. Many saw mergers. This was a significant moment in the development of the brand. All the brands in Vodafone’s portfolio were number one or two in their respective markets. which wasn’t possible when the market was dominated by a state owned giant. authoritative brand. 91 . Here again they found some degree of similarity. (2001). had a very different structure since BT had only entered the market as a minority partner in a joint venture and Vodafone was seen by many as the safe. as might be expected. F. the more recent entrants. so a change of ownership was but another change they had to manage. Warriors on the High Wire. greater brand loyalty and higher usage. Vodafone needed to consider very carefully how to go forward. In part. although less powerfully expressed. consumers expected change. joining a small risky venture in its early days and having consequently a feeling of parental responsibility for the baby they had nurtured. They explored attitudes of our management in each country as well as the consumer.

Vodafone clearly had some very similar brand positioning around Europe and so they were not trying to unite totally different brand franchises. there was no overwhelming desire for local name changes. although they did not agree with it. There were some concerns that the entrepreneurial spirit and the vigor of the organization could be lost in a multinational giant. They had worked hard and invested money in developing a local brand equity and saw no point in “throwing this away”.Vodafone’s managers could see the advantage for stronger links between the companies although preferably without making any change to the brand name. More importantly.the opportunity and freedom to communicate whenever and wherever you want. There was a perceived risk of losing customers and significant part of the personnel in the local teams. so why not focus on achieving those and why risk the change? A part of managers understood this attitude.3. they looked hard at the future development of the market and attitudes of consumers. transfer of best practices. So Vodafone had a starting point for developing a European strategy at least. but without a clear consensus of where to go. The introduction of WAP technology began to change this: it would no longer be just voice communications for the majority and date communication for some business users. They saw enormous benefits coming from the new links with Vodafone: they immediately identified advantages from combined purchasing power. And all the companies had a strong customer ethos and prided themselves on their dynamism. These benefits do not fundamentally differ from Milan to Malmo or Manchester to Malaga.The case for a single brand As one might expect from the attitudes of local managers expressed above. All the other synergy benefits did not require common branding. Of course. there would be higher usage in countries with poor fixed line networks and a different product mix between business and consumer and between pay as you go and conventional billing. service. efficiency and innovation. representation of regulatory authorities. 4. but it would 92 . It is clear that the core benefits of mobile phones are universal. but the basic benefit is the same. the creation of global products and services and the development of their and their colleagues careers.

travel a great deal and see the current roaming capability as a highly desirable benefit. Vodafone had already taken the decision to form a joint venture with the giant French media company Vivendi for the entertainment content of their core Internet offer. the emotional benefit. they judged that greater local tailoring would be required and that it would have been better to provide this themselves. They also judged that over time they would have the resources and imagination to develop new services for their customers to provide on-going justification for their claims. new and better services. p. 93 . Vodafone therefore came to the conclusion that they could provide some real substation to the brand positioning which fitted their brand profile and their customers’ needs.would prices increase. There is some feeling there that they are not good Europeans and will only speak English.more innovation. 145-147. which it was believed that Vodafone could legitimately own. trustworthiness. By contrast in Southern Europe. would local services reduced to a lowest common denominator. In northern Europe. Thus. A key product advantage would be Vodafone’s ability to offer identical services with identical numbers anywhere in the world30. flexibility and sensitivity to other cultures as well as more advanced technology. Warriors on the High Wire. where the profile of the bid battle meant that everyone had heard about it. Overall there is an 30 Gilmore.but there were some lingering concerns. is not ideal since not all features are available and sometimes they need different numbers for access. One key factor in evaluating this was the attitude of consumers themselves to a single brand: most of the attitudes were positive. They judged that the quality of this offer would be greatly enhanced by more resources and a larger customer base if Vodafone went ahead alone. was the offer of a richer and more fulfilling life. You only have to watch a business flight disembark at any airport to have vivid empirical evidence of this. Vodafone itself was largely unknown except Germany. Britishness implies reliability. but are not considered to be as technically advanced as German companies. would local customer service deteriorate? One critical factor was that users of mobile phones. For other input. However roaming as currently configured.provide totally mobile access to Internet content and to transactions on the Net. (2001). They also explored attitudes to the British/ English provenance of Vodafone. punctuality. notably their sport and business offer on the internet. Harper Colling Business. and particularly heavy users. British companies are seen as more likely to be sensitive to local culture than others might be. F.

and successfully. Vodafone’ s relationship with Manchester United has a global dimension and there may also be opportunities for major international sport sponsorship in the future. This meant that there was likely to be at least one international rival with the advantage of a single brand name and positioning. Finally. Vodafone do not expect the mass of the European customers to receive much coverage of the English cricket squad or even of the Derby. it is a very limiting perspective on the modern marketing mix. the competition authorities in Brussels imposed a condition for their approval of our acquisition of Mannesmann that Vodafone must divest its shareholding in Orange. Clearly. Chris Gent. The process of acquiring both AitTouch and Mannesman. international marketing was largely about shared advertising and certainly satellite television and the Net make this an important factor. It is much easier to consider this with a single brand. one of the most widely followed football clubs in the world. In doing so. a trade sale could deliver an advantage of speed and equivalent if not superior value. However. but latterly with sponsorship of Manchester United. They eventually sold Orange to France Telecom for 31 billion pounds.acceptance of the existence of multinational companies in the modern world and the feeling that mobile telecommunications was an industry in which one would expect multinationals to exist. Vodafone was a name on every investors lips. amongst both professional and private investors. The company believes it is right that they seek to reinforce this by maintaining the link between the corporate brand and its key operating constituents.initially of cricket and horseracing. felt that we would not risk compromise for Vodafone in the light of such competition. if they could achieve the right price. Vodafone has moved to being the largest company by capitalization in the UK and one of the top five in the world. in sponsorship. Vodafone eventually concluded that . 94 . The company sees sponsorship as a means of both maintaining brand awareness through continuous media coverage or our corporate identity and building our relationship with our business customers and suppliers through high-quality corporate entertainment. had given Vodafone a huge profile in the investment community. While they initially considered a flotation. On the other hand. As a result. they recognized that they were creating a bigger competitor and that the enlarged entity would move forward rapidly with the Orange name. The chief executive back then. Vodafone in the UK has invested heavily. Historically. There were a number of other important factors which questioned Vodafone’ s decision.

generation of new products and services. As Vodafone brand positioning developed.Implementing a single brand Vodafone therefore reached the conclusion that they should move forward with a single global brand. At the same time they put in place structures and mechanisms to stimulate the realization of some of the benefits of the enlarged Group. the sums involved were sufficiently large to prevent any serious discussion of maintaining the status quo. the act of compressing many months of work and a huge volume of market research might make this sound a clear-cut decision: while it was clearly my preference and that of my colleagues in corporate management’ we believed it wrong to impose it unilaterally. Inevitably.cross-fertilization of ideas. Warriors on the High Wire. (2001). They wanted to tap into the local entrepreneurial spirit and creativity. Harper Colling Business. The decision was also made that the brand should be Vodafone. since Vodafone was well established in the UK and a number of other markets. career development and opportunities for other markets. it seemed wasteful to invest in creating and promoting a new brand name in the absence of any significant negative elements and with some positive factors mentioned above31. The company operates in an international. 95 . In any event. Consumers have an instinctive grasp of the benefits of scale in technology. They set up a steering group with representatives from a number of different countries and the corporate center. However. Vodafone consumers are highly mobile and use their products all over the world for both business and leisure purposes. There remained the challenging of how to transfer the equity from the local brands to the global brand. Further work on the potential synergies in marketing revealed that significant savings could be achieved. F. 149. technology-based market and perceptions of technology brands are enhanced if they are believed to be multinational. Even if these were not delivered completely. exchange of best practice.without the need for a costly central bureaucracy to control everything.p. They were aiming for an organizational structure that would facilitate local execution within an agreed framework in a timely fashion. particularly in developing the final brand positioning and the design architecture of the transitional approach. accounting for over 20 percent of revenues. Again they used Springpoint to assist them. they consciously sought to take some common values that exist across all the brands in out portfolio and some values that are salient only in some 31 Gilmore. Vodafone clearly had to advise a transition strategy since they could not build Rome/Vodafone in a day.

Surveys carried out indicate the recognition and acceptance of the Vodafone brand in Greece currently stands at more than 81%. of course the corporate headquarters is based there. a fact that has contributed to the re-branding of PanafonVodafone to Vodafone at this point in time. Vodafone in the future must seen as a true global brand. Panafon-Vodafone.A and is the name under which Panafon shares will continue to be listed on the Stock Exchanges. 32 Gilmore. The change in brand name to Vodafone signals a new era for the company which has played a leading role in every aspect of the development of mobile telecommunications services in Greece since the beginning of its operations. businesses and communities to be more connected in a mobile world. they wanted to avoid falling into the trap of imposing a British brand based on our British values. Vodafone Group has a presence in 28 countries and provides mobile services to more than 95. 150-151.enriching customers’ lives. Vodafone Group’s mission as a company is governed by its vision to be the world’s mobile communications leader . Warriors on the High Wire. However the legal name for the time being still remains Panafon S. a continual reminder that they are building a global. The brand will need to capture the hearts and minds of their customers and our employees. from the original name Panafon. announces it will change its brand name to Vodafone effective from today. helping individuals. Harper Colling Business. but as a truly inspirational brand still has great growth potential and we plan to stay at the forefront of these developments32. 96 . Vodafone Group aims to make Vodafone one of the world’s most recognizable brands. They must not seen as an everyday commodity. p. yet clearly in touch with local cultures in the markets it operates. with no home territory. F.countries. and is in line with Vodafone Group’s world-wide strategy to bring controlled subsidiaries under the Vodafone brand umbrella. This change in brand name to Vodafone is taking place one year after the adoption of the double brand name. not a British brand. The re-branding to Panafon-Vodafone gradually introduced the Vodafone brand into both the Greek market and consumer’s conscience. Vodafone have deliberately set up our headquarters of the European marketing operation in Dusseldorf. the leading provider of mobile telecommunications in Greece.6 million customers.” Panafon -Vodafone. although Vodafone is strongest in the UK and. In particular. (2001).

Panafon-Vodafone’s customers have already benefited significantly from the participation in the Vodafone Group family from global products offering (Eurocall. Mr. I feel proud of the achievements to date and I am confident we will continue to lead mobile telecommunications in Greece33. The Greek mobile telecommunications market Mr. passion for results and passion for the world around us.com 34 97 . They see this in two ways: As fulfilling.vodafone. As empowering.” The core positioning is that Vodafone enables people to get more out of life. The change of brand name to Vodafone taking place today constitutes a token of the unambiguous success of our strategic moves and choices so far and at the same time marks a new beginning for the business.vodafone.hu www. Panafon was Vodafone Group’s first major investment outside the United Kingdom. Panafon has participated actively in the formation of Vodafone Group’s global strategy.The Vodafone vision is augmented with four principles: passion for customers.opening up more possibilities so you can do more that of what you want. CEO of Vodafone (in Greece). Koronias continued: “As we move towards the new generation of technologies that connect mobile phones to the Internet. as well as high quality of services. George Koronias. VHS). Since the beginning of its operations. Our active participation in a major global mobile telecommunication’s company provides Vodafone in Greece the opportunity to become even more competitive and to continue to play the leading role in developments within Greek mobile telecommunications market. offered through the Vodafone shops. said: “This is the beginning of a new era for the company. the presence of Vodafone in our country will be even more evident. passion for employees. Speaking about the change in the brand name of Panafon-Vodafone to Vodafone. Vodafone supports this with a number of important underlying core values34: Dependability Empathy 33 www.giving you control so you can live your life the way you want to and connect with the communities that are important to customers.

However we recognized that the brand identity itself is only one part of the equation: elements such as new product development and continuity of service as well as other internal and external communication will all be crucial to the transfer of equity. along with some local freedom to decide on the right framework for the presentation of the two brand identities. Somewhat unusually. The company still has places in the world where it would like to be but they are confident about their capability to make Vodafone a powerful global consumer brand with high levels of awareness and strong emotional values in a short amount of tim 98 .8 million customers. Vodafone established the principle that.Can-do attitude Innovation Joie de vivre There was a clear need for migration strategy in order to transfer the undoubted equity in the local brands to Vodafone in a timely and effective way. Now Vodafone has operations in twenty-eight countries. serving 154. the local brand will be dominant with Vodafone as a lower level endorsement. during the transition phase. across five continents. This will require an interim dual-branding phase with the local brand and Vodafone appearing together for anything from six months to two years.

99 .

Sign up to vote on this title
UsefulNot useful