Brand management at the strategic level, especially in multi-brand organizations, is a key issue that requires precise planning and management of the brand portfolio. Let’s discuss this in detail, starting from the basics, through technical aspects, to specific examples from the practice of giants such as Unilever and Procter & Gamble.
Introduction to brand management in multi-brand organizations
What is brand architecture?
Brand architecture is a structure that defines the relationship between the various brands in a company’s portfolio. It defines how brands are related to each other, how they are positioned in the market, and how they work together to avoid cannibalization and maximize synergy.
Key brand architecture models:
- House of Brands (House of Brands):
- Each brand operates independently, with its own identity and strategy.
- Example: Procter & Gamble (P&G) – brands such as Tide, Pampers, Gillette operate independently.
- Branded House (Branded House):
- All products and services are subordinated to one main brand.
- Example: Google – all services (Google Search, Google Maps, YouTube) are under the Google brand.
- Hybrid Model:
- A combination of the two models above, where some brands operate independently and others are subordinate to the main brand.
- Example: Unilever – brands such as Dove and Axe operate independently, but are supported by the Unilever corporate brand.
Challenges in brand portfolio management:
- Cannibalization: the risk that one brand takes market share away from another brand in the same portfolio.
- Synergy: The ability to leverage shared resources and competencies to strengthen all brands in the portfolio.
- Consistency: Maintain a consistent corporate brand identity and values.
Brand portfolio management strategies
1. market segmentation and targeting
- Identification of market segments:
- Segmenting the market based on demographics, behavior, needs.
- Example: Unilever segments the market based on consumer needs – Dove brand for skin care, Axe brand for young men.
- Targeting:
- Each brand targets a different market segment to avoid cannibalization.
- Example: P&G’s Tide brand is aimed at families, while the Ariel brand is aimed at those seeking advanced laundry solutions.
2. brand positioning
- Unique Value Proposition (UVP):
- Each brand should have a unique value proposition that differentiates it from other brands in the portfolio.
- Example: Unilever – the Ben & Jerry’s brand is positioned as premium, while the Magnum brand is aimed at a wider audience.
- Differentiation:
- Differentiating brands in terms of price, quality, functionality.
- Example: P&G – the Gillette brand is positioned as premium, while the Bic brand is positioned as economy.
3. resource and competency management
- Shared resources:
- Use of shared resources, such as distribution, research and development, marketing.
- Example: Unilever uses a common distribution network for all its brands.
- Competencies:
- Developing competencies that can be used by different brands.
- Example: P&G is developing product innovation competencies that are used by various brands.
4. communication and branding
- Consistent communication:
- Maintaining consistent corporate brand communication while allowing each brand to be individualized.
- Example: Unilever is promoting its brands as part of a larger mission of “Making Sustainable Living Commonplace.”
- Branding:
- Create a strong brand identity for each brand in the portfolio.
- Example: P&G – the Pampers brand is associated with baby care, and the Olay brand with skin care.
Examples from practice: Unilever and Procter & Gamble
Case Study 1: Unilever
- Brand Portfolio:
- Unilever manages more than 400 brands, including Dove, Axe, Ben & Jerry’s, Magnum.
- Strategy:
- Market segmentation: Each brand targets a different market segment.
- Positioning: a unique value proposition for each brand.
- Shared resources: Leverage a common distribution network and R&D competencies.
- Communication: promoting brands as part of the larger mission of “Making Sustainable Living Commonplace.”
- Results:
- Avoiding cannibalization and maximizing synergies between brands.
- Strong market position and consumer loyalty.
Case Study 2: Procter & Gamble (P&G).
- Brand Portfolio:
- P&G manages brands such as Tide, Pampers, Gillette, Olay.
- Strategy:
- Market segmentation: Each brand targets a different market segment.
- Positioning: differentiate brands by price, quality, functionality.
- Shared resources: Leverage shared competencies in product innovation.
- Communication: consistent corporate brand communication, while allowing each brand to be individual.
- Results:
- Avoiding cannibalization and maximizing synergies between brands.
- Strong market position and consumer loyalty.
Summary
Brand management at the strategic level in multi-brand organizations requires precise planning and management of the brand portfolio. Key strategies include market segmentation, brand positioning, resource and competency management, and consistent communications. Examples from the practice of companies such as Unilever and Procter & Gamble show how a brand portfolio can be effectively managed to avoid cannibalization and maximize synergies.
