According to Interbrand’s annual study, the value of the top 100 global brands was more than $1.25 trillion dollars in 2011. Even in these days when we are used to ever larger financial figures being casually tossed around that is still a huge number. As Wharton marketing professor, Barbara Kahn, says ‘if a brand is a company’s most valuable asset, how do you manage it?’
More importantly notes Kahn ‘how do you use it as a mechanism for growth, leveraging the brand as part of the company’s growth strategy?’ Kahn is clear that while brand is a mechanism for growth, ‘the issues of managing it are strategic ones before they are execution ones’. Meaning that while implementing advertising and social media campaigns may be where the customers see the brand activity, the real work has to come before that in identifying what the brand can accomplish and, just as critically, what the brand cannot do.
‘Coca-Cola is the world’s most valuable brand, worth $71 billion, but it is actually limited as a brand. It will extend comfortably to Diet Coke and Zero but it doesn’t work with orange juice for instance. The idea of OJ being twinned with the brown fizzy stuff is not appealing – so the firm only uses its company name to support its other products, its Minute Maid orange juice is discreetly branded as being made by the Coca-Cola Company.’ This is an approach famously used by Proctor and Gamble, where they have built up a ‘House of Brands’, with their products having their own standalone branding – who knows that Pampers nappies/diapers, Duracell batteries, Eukanuba pet food or Fairy Liquid all are owned by the same corporation?
Using brands to leverage growth opportunities is a fine art and Kahn emphasises that it is really important to understand ‘how far you can stretch a brand’. The new ‘Brand Leadership’ program Kahn is leading this June at Wharton will help participants measure their brands and scope out what they can do with them. The program will do this through the use of peer-to-peer brand audits employing qualitative and quantitative evaluations. The ‘House of Brands-Branded House’ spectrum is a framework that can assist managers to plot where their brands lie and so what strategic growth opportunities are available to them. ‘It is not an either/or alternative’ says Kahn. The Marriott group maintains its high-end Ritz Carlton and Renaissance brands separately from the Marriott brand, but it also runs the JW Marriott hotels as the Marriott branded high-end offering. In between it uses endorsed brands, such as Courtyard by Marriott and Springfield Suites by Marriott to underline these brands’ Marriott connections.
Kahn explains that it is important that there is a synergy between the product and the parent brand – both have to benefit from the association, she cites the damage done to Miller High Life beer by the launch of Miller Lite, where the impression of the ‘lite’ characteristic got transferred back to the original with adverse impact.
Today Kahn acknowledges that managing brands is much more complex than previously as the channels to promote them to consumers have multiplied and it is important that all the channels work together to ‘keep the brand experience consistent’. The advent of social media and its rapid growth and development has made this task ever more challenging. While no-one can have all the answers to understanding this ‘omni-channel’ approach to brand promotion as it is changing all the time, Kahn, as Director of Wharton’s Retail Research Center, says that they have a huge number of examples to draw on as they follow a very wide range of sectors and channels and so are able to see emerging patterns and processes earlier than others. This allows them to quickly leverage this knowledge into the learning they can offer at the school.