"If this business were to be split up, I would be glad to take the brands, trademarks and goodwill and you could have all the bricks and mortar - and I would fare better than you."
(John Stuart, former Chairman of Quaker Oats Ltd)
This quotation quickly makes us aware that brands are valuable assets among three types of sources of earnings: tangible assets, brands, and intangible assets. By reading the business press, you are no doubt aware of the financial value of brands. This was famously demonstrated by Nestle's purchase of Rowntree for 2.5 billion pounds. Even though Rowntree's tangible net assets were worth only about 300 million pounds, the potential earnings from its brands such as KitKat, Polo and After Eight Mints made the company far more valuable.
Because of consumers' increasing sophistication and ever-demanding expectations, that which is regarded as added value today will tomorrow be taken for granted. For example, the problems experienced in the late 1990s by the British retailer Marks & Spencer, historically a strong brand, were largely attributed to a loss of customer focus. Thus, a dynamic approach is needed when strategically building and sustaining brands. There is a systematic process involved in developing and strengthening brands.
The process starts with the brand vision stage, which is concerned with putting down markers about the desired future for the brand. First, the values that underpin the brand. Second, the future environment, Third, the purpose for the brand, i.e. how the world will become a better place as a consequence of the brand.
The brand vision then needs translating into stretching, but realistic brand objectives. Ultimately, these need to give your staff a clear target to aim for and they should be able to provide some idea of what the brand needs to achieve.
The brand audit stage encourages managers to audit the five key forces: the corporation, distributors, consumers, competitors and the macro-environment (social, technological, economic, environmental and political). The purpose of this stage is to identify the critical forces which may facilitate the brand's route towards its vision and identify where it will be facing its greatest challenges.
Out of brand audit process ideas will began to emerge about what the brand might be and the shape it will need to take to meet the promise. At the brand essence stage the management team works to identify the central attributes that will distinguish the brand. Through a process known as 'laddering' the rational benefits, emotional rewards, values and personality characterizing the brand are subsequently defined.
The implementation of the desired brand essence then needs to be addressed at the brand resourcing stage. At this stage, issues such as naming the brand, appropriate communication vehicles, quality and long-term relationship building need clarifying.
On a regular basis brand evaluation is needed to monitor brand performance against the brand objectives. Depending on the monitored results, appropriate actions can be taken.
Even though this flow process has been described from the perspective of developing a new brand, it is also suitable for sustaining existing brands. With existing brands the challenge is to keep them refreshed and relevant for a changing environment. We will help you with either of these two assignments.