Groups Analysis Case Submission: SAP Building a Leading Technology

Brand

PART: A
• Why didn’t SAP pay much attention to marketing and branding till 2000?
• Until 2000, SAP was :
• World’s largest enterprise SW company
• World’s 3rd Largest independent SW supplier overall-12500
customer and 25000 SW installations
• Most customers are predominantly large enterprise companies.
• Innovative product development with a product driven
organizational culture ; branding & marketing was never the focus of the
company’s culture.
• SAP almost enjoyed a monopoly , was an industry leader in the
enterprise product solutions until 2000.And so SAP was confident & didn’t feel
marketing & branding was critical to sustain the business & grow.

• What explained the good performance of the company in the initial three
decades (1972-2000)?
• Innovation products; Successful product launches every decade
-R/1 in 1972, R/2 in 1980s , R/3 in 1990s
• Reliable products that was present that all major markets
• Flexibility to support customer demands

• What are the challenges SAP is struggling with in the year 2000?  

• Competition from new Internet Vendors :

Being Product focused / internal focused, they were disconnected from the changes in
the market and missed the boat to internet /eCommerce. Was unable to adapt to
changing customer expectations

• Weak marketing & branding strategy :

• Absence of a global and consistent perspective in

communication.
• Marketing was a decentralized function organized by
country ; so different local ad campaigns resulted in inconsistent
messaging.
• SAP is mostly a back-office SW,so it was not very easy to
describe the company’s purpose ,especially to a non-tech savvy audience,
but SAP sales teams always communicated in complex technical jargons.
• Multiple variations of branding logo, and branding taglines
lead to confusion.
• Multiple websites with inconsistent content, leading
inconsistent positioning of the company
 • Essentially SAP was a product driven company, and the
challenge was to transform SAP into a market driven company.
• Perception impacting sales volume:
• Company has built a perception of being outdated.
• Mysap.com which was the new internet-based product suite
was used to replace the corporate brand to change the company’s
perception, but instead it put company’s brand equity at risk
• Non-alignment of the Organization :
• SAP regional teams were disintegrated in terms of
communication delivery and value proposition to the customers, there was
an absence of “one-template” for Sales support.
 
PART B:
• Describe the impact of Holmish’ initiatives on SAP’s performance -  sales,
profits, brand equity (p.15).
* CAGR- Growth Rate – High compared to competition
* SAP was on Business Weeks top 100 brands and delivered theme - “
The best run e-business run SAP”
* SAP posted 13 consecutive quarters of double-digit growth and
increased profitability after he used the brand promise as a focal point in
developing a vision and formed a new value engineering business team
* After brand workshop, the employees were able to define SAP as a
business organization rather than a tech organization.
* Between 2000-2005 SAP brand value rose by 46% - Ranked 36, profit
grew by 202% and its global market share became 21%.
* Growth of 255% in mid-market segment in software installation
worldwide, from 25,000 in 1999 to 88,700 in 2004
* Financial results of companies listed in NASDAQ and NYSE showed
that the companies which use SAP were 32% more profitable than those which
don’t run SAP ;deliver 28% more return on capital.

2.      Analysis the impact of Homlish' initiatives on SAP performance and list the key initiatives
in the order of their impact.

• Clearly defining SAP’s value proposition - SAP branding and message

was not coherent globally. This has created confusion in customer’s minds about the
value proposition of the company.
• SAP Global Marketing team formed based out of New York-to
build a perception of a truly global company
• Started by stopping all global advertising until a coherent strategy
was implemented.
• Improved messaging for SAPPHIRE conference : Central goal :
“SAP gets it.”

• Alignment across the organization - Internal alignment was another

challenge for an organization of this size.
 • To do this, SAP’s global marketing team developed tools which
brought global and regional marketing into alignment. Adoption was echoed by
incentivization instead of mandating changes.
• SMART- Sales & Marketing repository toolset to help deliver
consistent sales & marketing content to all field offices ; could be adapted to local
needs
• One Voice resource over SAP’s intranet for all employees
• Establishing a branding culture
• New tagline- evolving over stages, which highlighted the common
theme across customer executives (“The best run businesses run SAP”)
• New Brand architecture
• Consolidated SAPs multiple websites globally
• Consistent Global communication of new brand driven through
alignment rather than ‘command & control’- Done via multiple tools
• Branding Customer Experience
• Branding the customer experience in all touchpoints – Ex. SAP
America
• Design and usability of their products to showcase their
commitment to the brand promise and demonstrate focus on customer experience.
• New Products development was driven by market insights from
their customer, competitors, and marketing forecast.
• Redefining business objectives driven by the new branding - Big Five
marketing priorities :
• Focus on SME-Small & Medium Enterprises Segment-change the
perception that SAP is only for big companies.
• Impact : Increased worldwide market share -21% Global market
share