Brand Portfolio Mgt. Presentation PDF

LANGBERG & CO.

INTEGRATED GO-TO-MARKET STRATEGIES TM

LANGBERG & CO.

Copyright Langberg & Co. 2009

Since 1989

Since 1989www.langberco.com

WHAT IS LANGBERG & CO.● A consulting and ventures firm with three areas of focus:

1. Product / Customer / Sales● Profitable customer segmentation and customer insights

● Product development or rejuvenation

● Brand portfolio management

● Channel optimization including sales force and distributor effectiveness

2. Operations / Supply Chain / Manufacturing

● Network optimization, including the number, location, and size of dist. & manufacturing

facilities ● Sourcing partnerships

● Product life cycle mgt. where products are optimally integrated into the supply chain

3. Mergers & Acquisitions – factory to consumer integrated due diligence

● A trademarked process to ensure strategy and operational integration – Avoid academic theory

● 20 years of enriching B2B and B2C companies

● Only senior level executives

LANGBERG & CO.

Since 1989


WE WORK WITH LEADERS

● Sprint

● Butler Manufacturing

● CSX

● Cook Compression

● Michelin

● American Standard

● Mannington Mills

● J&L Specialty Steel

● Hallmark

● Crayola

LANGBERG & CO.

Since 1989


BRAND PORTFOLIOWORKSHOP & FACILITATION

LANGBERG & CO.

Since 1989


Today’s Goal

Lay the foundation to objectively evaluate the need for 1, 2 or 3 brands and their value and profitability to the company’s overall brand portfolio.

LANGBERG & CO.

Since 1989


What Type of Company Are You?

DEFINITION & EVOLUTION OF “DRIVEN” COMPANIES Manufacturing Driven - 1940’s – 1970’s

Develop products and go-to-market strategies primarily based on equipment utilization

Sales Driven – 1970’s – 1990’s

Develop products and go-to-market strategies primarily based on the “voice of the sales force”

Marketing Driven – 1990’s to present

Develop products and go-to-market strategies primarily based on the “voice of the customer” and external dynamics

• Customer (properly defined and segmented)• Competition (properly defined)• Legislation• Societal environment

LANGBERG & CO.

Since 1989


Aligned & Integrated For Profitable Growth

1. Concept Formulation

2. Features & Benefits Definition

3. Target Audience Definition

4. Positioning Statement

5. Product or Service Mix

6. Distribution Channels

7. Pricing

8. Sales & Selling Processes & Disciplines

9. Customer Care Processes & Disciplines

10. Packaging

11. Graphics & Design

12. Site Selection Criteria

13. Promotional & Merchandising Programs

14. Supply Chain Management

15. Human Resources Plan

16. Management Information Systems

StrategicElements

TacticalElements

EnablingElements

Continuum Marketing; Copyright Leslie S. Langberg 1989-2009

LANGBERG & CO.

Since 1989

Aligned & Integrated For Profitable Growth

1. Concept Formulation

2. Features & Benefits Definition

3. Target Audience Definition

4. Positioning Statement

StrategicElements

Continuum Marketing; Copyright Leslie S. Langberg 1989-2009

LANGBERG & CO.

Since 1989

Structure – 3 Core Components

Target Audience Definition

The attitudinal and demo (firmo) graphic description of the primary prospect to whom the brand is intended to appeal

Frame of Reference

The category in which the brand competes; the context that gives the brand relevance to the target audience

Benefit Statement

The most compelling and motivating meaningful benefit that the brand can own (or have a first-to-market sustainability) in the hearts and minds of its target audience relative to the competition

Brand Portfolio Mgt.

Objective

Specify the roles and relationships of a company’s brands to one another ensuring they are clearly positioned and marketed to the company’s target audience(s).

Key Advantages

Avoid consumer and customer confusion

Ensure internal efficiency by preventing investment in overlapping product development and or marketing efforts

Maximize overall profitability and market share

LANGBERG & CO.

Since 1989


Types of Branding

Private Label

A brand created and owned by a reseller of a product

Co-Branding

Using established brand names of two different companies on the same product (in most cases one company licenses the other to use with its own)

Line Extension

Using a successful brand name to introduce additional items in a given product category under the same brand name

Brand Extension

Using a successful brand name to launch a new or modified product in a new category

Multibrands

Introduction of additional brands in the same category

LANGBERG & CO.

Since 1989


Line Extension

Using a successful brand name to introduce additional items in a given product category under the same brand name

Pros

Low-cost, low-risk to introduce new products

Meet consumer demand for variety

Utilize excess capacity

Command more “shelf space” from resellers

Cons

Lose its brand meaning

Cause marketplace frustration – with both resellers and consumers

Could come at the expense of other items in the line

Works best when it takes sales away from competing brands, not when it cannibalize a company’s other products

LANGBERG & CO.

Since 1989


Brand Extension

Using a successful brand name to launch a new or modified product in a new category

Pros

Typically saves high advertising costs needed to build a new brand

Gives a new product instant recognition and faster acceptance

Cons

Unsuccessful brand extensions can de-value the core brand

The “mother” brand can lose its meaning through brand extensions that “don’t fit.”

The brand extension must have the “permission” of the marketplace to work best

LANGBERG & CO.

Since 1989


Multibrands

Introduction of additional brands in the same category

Pros

Establishes different features and appeal to different buying motives

Secures more resellers and or more shelf space

Protects the core brand by setting up flanker or fighter brands

Cons

Typically each brand secures a small share, each fighting to be profitable

Spreads the company’s resources

Brands are often developed to appease resellers, claiming exclusivity or provide a veil of “non-competing” brands

Works best when there is identifiable differentiation in features and appeal to different buying motives

LANGBERG & CO.

Since 1989


POSITIONING STATEMENTS:MUST THEY BE UNIQUE?

No. In a commodity category highlighted with relatively short-lived advantages in technological advances – virtually all of which are duplicated within a short time frame by competitors - finding a unique benefit with sustainability is difficult. Consequently, the players in the category need to compete largely on how well they:

1. Can accurately understand customer needs and desires – both rationally and emotionally driven;

2. Can align those needs and desires with their internal business functions (manufacturing, product development, marketing, etc.);

3. Can assist their respective distribution channels build a meaningful bridge to the consumer and;

4. Can tactically execute and sustain that execution against a defined strategic position.

LANGBERG & CO.

Since 1989


A MARKET LEADER

A firm that has the largest percentage total sales revenue of a market or product. Often dominates its competitors in:

Customer loyalty Distribution Coverage Image Perceived value Price Profit Promotional spending

LANGBERG & CO.

Since 1989

The cardinal rule in offensive strategy is not to attack a leader head-on with an imitative strategy

Successfully attacking a leader requires that a challenger meet three basic conditions.

ATTACKING A LEADERLANGBERG & CO.

Since 1989

1. A sustainable competitive advantage – in either cost or differentiation. Without sustainability the challenger will not sufficiently have time to close the market share gap before the leader can imitate.

2. Proximity in other activities – the challenger must have some way of partly or wholly neutralizing the leader’s other inherent

advantages. Unless challenger maintains cost proximity, the leader will typically use its cost advantage to neutralize the challenger’s differentiation. Attack on a cost advantage alone must create an acceptable amount of value the the buyer.

3. Some impediment to leader retaliation – The leader must be disinclined or constrained from protracted retaliation against the challenger or a changing marketplace.

CONDITIONS FOR ATTACKING A LEADER

LANGBERG & CO.

Since 1989

Pursue strategies and programs to strengthen and protect its position

Build total demand for its products – consumption, more usage, new users

Product innovation

Market share growth

Assess and address competitive threats – quickly!

A LEADERS MANDATELANGBERG & CO.

Since 1989

Two Key Tactics

Blocking

Countering a competitive thrust with a forceful, direct response

Covering

A replication of a competitive move, not allowing a competitor to occupy “marketing” space that might pose a danger to the ongoing success of its products

Typical Considerations

Service Distributor programs Product attributes Price Warranty New product or brand

ADDRESSING COMPETITIVE THREATSLANGBERG & CO.

Since 1989

The Value EquationLANGBERG & CO.

Since 1989

A View Incorporating Brand Equity

Value = Price (P) + Tangible Attributes (T) + Brand Equity (B)

Tangible Attributes

Product and service related features and benefits

Brand Equity

Trust, longevity in marketplace, social responsibility, consistent

performance, etc.

Undifferentiated Meaningful & Differentiated

Innovation


The Value Equation

As tangible attributes (T) and brand equity (B) decrease in value (i.e. become less differentiated), price (P) becomes the major component in the value equation.

>P = <T + <B

When price (P) and tangible attributes (T) become less differentiated, brand equity (B) becomes the major component in the value equation.

>B = <P + <T

LANGBERG & CO.

Since 1989


Attack Yourself

1. If we were starting a company and had significant VC money behind us, how would we attack AO Smith to steal share?

2. How many brands would we go-to-market with?

3. If more than one, how would we differentiate the brands and…

4. Would we offer the brands to all distributors?

LANGBERG & CO.

Since 1989


Documents

Brand Portfolio Mgt. Presentation PDF