by: Idris Mootee

This is a
model I developed in the mid 1990's to help companies understand how a
particular brand should be positioned and its relation to the company's overall
strategy. I was helping many senior ad agencies' executives/planner from New
York to Tokyo to use this to understand their clients' branding issues. This
was based on my extensive study of US and European companies and their brands
in different categories.

This model
enables companies to look at their corporate strategies, portfolio of brands
and products in a meaningful way. I have not revisited this since this was
published some ten years ago. I thought you would find this interesting.


The analogy is that all brands basically evolve through four stages.
Most of them start as a Product Brand, and then some are transformed into a Service Brand.
Over years of brand building effort and market presence they gradually become
either a Category Brand,
which is defined as having leading market share within a category; or a Personality Brand, which establishes a
strong brand personality that consumers identify with; or an Experience Brand, which goes beyond
traditional service and product excellence with a strong sense of
uniqueness.

Idris_mootee_brand_life_cycle_model

Procter & Gamble is not particularly well known among consumers,
while its brands--Ariel, Tide, Pampers,
Always, Pantene are all very well known brands within their respective
categories. Another type of brand is an Ingredient
Brand
, which is actually a co-brand since it co-exists together
with others who might be responsible for physically manufacturing products or
delivering of the service. 

Ingredient Brands usually serve the purpose of providing additional
trust or confidence and often signify the use of an exclusive or proprietary
technology. Examples include Lycra, Polartec, Gortex, Windows, Intel, Dolby and
Oracle etc. This is the exact opposite of product brands. By contrast, the
technology products communicate at the level of the company whose credibility
and expertise have turned its name into a brand is stressed. The most
successful case is likely Intel. If you buy an IBM computer today (already a
powerful brand name), you will find two other co-brands: Windows and Intel.
Twenty years ago we would not have envisioned the operation system and chip
supplier would put their brand side by side with IBM. Today, however, they are
top household names.

Ingredient Brands are not new. Only the term is. It existed hundred of
years ago in the form of country brand. Remember all those "Made in
Germany" and "Made in Japan" labels, symbolizing quality and
sound engineering. The chemical and pharmaceutical industries have also become
skilled in using the Ingredients Brand. When Du Pont differentiates its
elasthane it becomes a symbol of quality. Without the Lycra label, consumers
might believe that this fabric was a lower quality material. Lycra gave Du
Point so much market power that the whole industry paid premium prices for this
material. Du Pont actually made Lycra fashionable; how often have you heard of
a chemical company who provides the material that has an impact of fashion
trend.

After being extremely successful these brands
become cash generating trademarks. They will then sometimes be moved up one
level and become a
Corporate Brand (the brand name
becomes the corporation) or a
Global Brand, expanding
geographically to become a global dominant leader. These different stances
illustrate the major strategic choices required by each corporation, namely the
optimum level at which a brand should be positioned to capture and create
shareholder value. Companies sometimes can successfully move brands to
different strategic levels and become the overall brand if that brand is very
successful.

Sometimes a brand needs to move from one
category and become a brand of multi-categories. This is particularly common in
fast moving consumer goods. In choosing a branding level you position against
future competition to enjoy the best competitive advantage vis-à-vis channel partners
and consumers. This is always the key consideration governing the choice of
level.

These categorizations are not mutually
exclusive. A brand can be both a global brand and a personality brand (Virgin)
or a global brand and an ingredient brand (Intel). The model suggests that the
ultimate goal for all companies is to have a global brand. A strong global
brand is a powerful weapon. These days, it is an indispensable one, as the
economy challenges our faith in brands to deliver a profit. All studies suggested
the most valuable brands are all global.

Original Post: http://mootee.typepad.com/innovation_playground/2007/09/understanding-t.html

Leave a Comment