Assignment 10.1 – BRAND INNOVATION

Tú Oanh – Hồng Ngọc – Kim Hà

BRAND INNOVATION DEFINITION

What is brand innovation?

Brand Innovation is the specific tool to leverage brand value from ideas, to exploit change as an opportunity for a

different business. It refers to not only products but also services, experiences and processes.

What is brand innovation level?

Refresh Same

benefits,

refresh the

offer

Compete New benefits in

existing offe

Breakthrough New offer, new

benefits

Example

It is about new ways of doing and seeing things as much as it is about the breakthrough idea.

BRAND INNOVATION DEFINITION

Why is brand innovation important?

Stretch the brand in

the category

Develop

brand’s USP

Discover opportunities,

competition and trends shift

Enhance consumer’s loyalty

and reach new users

Well-defined business growth and gain more profit

Creativity and Innovation

The thinking process of

popping up ideas The process of exploiting

creative ideas to meet

business needs

Creativity Innovation

KEY PRINCIPLES OF BRAND INNOVATION

What is a successful brand innovation? What is a failed brand innovation?

• Leverage the brand’s most emotional and prominent equities

• Create coherence in brand’s activities or new extension

• Develop a culture of ongoing innovation

• Get profit

• Loss of focus on brand root strength

• Lack of consistency with brand vision

• Irrelevant/ Not focus on consumers

• Out of date with the social background

Example:

Being an established breakfast leader, Kellogg’s business

includes cereal, snacks, frozen foods and emerging food.

To expand in emerging markets, Kellogg’s launched its

Kellogg’s To Go breakfast shakes, which are a logical brand

extension for their on-the-go culture.

Example:

Kodak successfully invented the first digital camera, being a tech

giant in disruptive technology. However, they didn’t take

advantage of this strength, Kodak’s primary strategy was to sell

high margin film. In the digital centuries, the company

developed inexpensive cameras as a means to an end: their

purpose was to facilitate lucrative film sales because they feared

that digital camera would impact negatively their film business.

KEY PRINCIPLES OF BRAND INNOVATION

Key principles of brand innovation

IN THE BRAND SIDE

Relevant to brand essence and brand strategy

Balance between brand’s comfort zone and breakthrough ideas

Could be measurable ⇒ focus on ROI

IN THE CONSUMER SIDE Address potential consumer’s unmet needs

Connect consumers and brand

DOs:

- Understand clearly brand architecture and identify growth areas

Anticipate or catch the trends based on cultural context

- Create process to filter brand ideas

- Tell consumers stories

DON’Ts - Too safe or too far idea

- Try to drive consumer to what they don’t really need

DOs and DON’Ts

BRAND INNOVATION PROCESS

• Opportunities

• Objectives

• Measure of

success system

• Ideas

• Product

concept

Implementation Context Idea generation Idea selection

• Formulation work

• Sensory panel

test

• Storage test

• Consumer

research test

• Packaging

development

• Product

cost/profitability

Feasibility

Post-launch Capability

• Plant

equipment

• Plant

commissioning

• Plant trials

LAUNCH Evaluation Development

Charter

gate

Contract

gate

Launch

gate

BRAND INNOVATION PROCESS

Brand innovation process Example

Ideas and concept

Feasibility

Capability

Context In 2006, only 6 millions of mobile products were sold in America, compared to 1 billion products worldwide. 2 millions of them

were used in Windows system and the rest were RIM (Blackberry) and Palm (Treo). However, mobile service suppliers in

America were so cautious to Microsoft that its plan for smartphone failed

A smartphone with radical improvement of user experience and design which set a new

dominant design for smartphone. Apple are very focused when it comes to goal setting as they

primarily focus on design, software and ease of use IPHONE

The few products have also made it possible for Apple to have only one R&D department for almost all of its product

categories. One R&D department ensures that the user experience is the same across all product categories and thereby

increases user trust. Apple’s narrow product focus in every product category has paid off since they have more efficient R&D

figures when comparing them to Nokia’s R&D figures. Apple spent 2.5 % of phone sales on phone R&D in 2010 while Nokia

spent 10.2 %.

Apple have been able to negotiate lower prices from the suppliers, get more money from the carriers and demand secrecy on

top of that.

Apple have a large base of external apps developers and apps are important since they keep customers loyal to the

smartphone vendors.

Apple have been forced by the courts to license in and license out which was mentioned in the technological portfolio

BRAND INNOVATION PROCESS

Brand innovation process Example

Post – launch evaluation

Development

Launch Launch the 1st IPhone and the next generation per year

They only introduce one smartphone per year and make a smartphone that they want to use themselves.

Introducing one universal smartphone per year is one of their main advantages, but also a brave action, as it

gives the R&D department much more time to improve their iPhones. s.

Innovation on development base: