Aaker on Branding. David Aaker
When brands are considered assets, the role of brand management radically changes, from tactical and reactive to strategic and visionary. A strategic brand vision linked to both the current and future business strategies and providing a guidepost for future offerings and marketing programs becomes imperative. Brand management also becomes broader, encompassing issues like strategic market insights, the stimulation of “big” innovations, growth strategies, brand portfolio strategies, and global brand strategies.
THE MARKETING ROLE IS ELEVATED
With a strategic view, the brand needs to be managed by people higher in the organization, often the top marketing professional in the business organization and his or her executive colleagues. For marketing-driven organizations, where there is marketing talent at the top, the ultimate brand champion will be a top executive, perhaps the CEO. When the brand represents the organization, as it often does in a BtoB or service firm, the CEO often is involved in bringing the brand to life because, in that case, the brand is intertwined with the organizational culture and values as well as its business strategy.
Marketing now gets a seat at the strategy table, a participant at creating and managing the business strategy. The elevation of brands and brand building as a driver of business strategy provides a point of entry for the marketing team. Once in place, marketing has much to offer to business strategy development starting with customer insights that can and should enable growth initiatives and be the basis for strategic resource allocation. Further, the very heart of business strategy is market segmentation and the customer value proposition, the prospects of which will be informed by the marketing team.
FOCUS ON BRAND EQUITY
Shifting the emphasis from tactical measures, such as short-term sales, to strategic measures of brand equity and other indicators of long-term financial performance is a monumental change. The guiding premise is that strong brands can be the basis of competitive advantage and long-term profitability going forward. A primary brand-building goal will be to build, enhance, or leverage brand equity, the major dimensions of which are—awareness, associations, and loyalty of the customer base.
• Brand awareness, an often-undervalued asset, has been shown to affect perceptions, liking, and even behavior. People like the familiar and are prepared to ascribe all sorts of positive attributes to items they find familiar. Further, brand awareness can be a signal of success, commitment, and substance, attributes that can be critical to industrial buyers of big-ticket items and consumer buyers of durables. The logic is that if a brand is recognized, there must be a reason. Finally, awareness can affect whether a brand is recalled at a key time in the purchasing process and thus among the brands the customer considers.
• Brand associations include product attributes (Crest, Volvo), design (Calvin Klein, Apple), social programs (Avon, Patagonia), quality (Lexus, Southwest Airlines), user imagery (Mercedes, Nike), product breadth (Amazon, Marriott), being global (VISA, Ford), innovation (3M, Virgin), systems solutions (IBM, Salesforce.com), brand personality (MetLife, Singapore Airlines), and symbols (Tiffany blue box, Golden Arches).… anything that connects the customer to the brand. They can be the basis for a customer relationship, purchase decision, use experience, and brand loyalty. A critical part of managing brands as assets involves determining what associations to develop, creating programs that will enhance those associations, and linking them to the brand.
• Brand loyalty is at the heart of any brand’s value because once obtained, loyalty is persistent. Customer inertia will benefit the brand that has earned loyalty. Breaking a loyalty link is difficult and expensive for a competitor. As such, one brand-building goal is to strengthen the size and intensity of each loyalty segment by making the basis of the customer relationship consistent over time and, whenever possible, rich, deep, and meaningful.
FROM BRANDS TO BRAND FAMILIES
Brand management has historically been about focusing on a single brand and country as if it was operating in isolation within the firm and the world market. That approach is a legacy of the classic P&G brand management system that can be traced to a 1931 memo with a job description for a “brand man” written by Neil McElroy, then a P&G junior marketing manager who later became CEO and then Secretary of Defense, who was struggling to manage a Camay soap brand that was overshadowed by the Ivory soap brand. The premise was that each brand was autonomous, with its own brand program, a view that is no longer strategically viable.
More and more organizations are realizing that strategic brand management has to involve a “family” of brands, managed as a portfolio. The essence of brand portfolio strategy is to make sure the brands of the organization, including subbrands, endorsers, and branded innovations, work in concert to create clarity and synergy, cooperating instead of competing. Each brand needs a well-defined role, which might actually include helping other brands. And these roles could change over time, as can the product scope, as a brand is extended both horizontally and vertically. Firms are finding ways to allocate resources over brands and markets to protect the brand stars of the future and to make sure each brand has the resources to be successful in its current and future assigned roles.
STRATEGIC ISSUES OF BRAND EXTENSIONS
When brand is viewed as an asset, the opportunity arises to leverage that asset to generate growth, an objective of most firms. It can be used as a master brand or perhaps as an endorser to support a strategic entry into another product class, providing a platform that will deliver awareness and positive associations such as perceived quality. A brand can also be leveraged vertically to support an upscale or downscale offering. However, under the “brand as asset” model the goal is not just to create a successful brand extension but to enhance the brand and the whole brand portfolio. A strategic, broader perspective is introduced.
ORGANIZATIONAL SILO ISSUES NEED TO BE ADDRESSED
Nearly all brands span different silo organizations defined by products, markets, or countries. At some firms (GE or Toshiba, for example), a brand could drive customer relationships in a thousand product markets. When brands are viewed tactically, silo autonomy appears to work as it allows those organizational units closest to the customer to adapt the brand to their needs.
However, losing control over silo brand-building creates inefficiencies, lost opportunities, and diminution of the brand. When the brand is allowed to be taken in different directions by different silos, it will become confused and weak. Further, effective and efficient brand building often requires scale and the motivation to share best practices. As a result of these issues and others, it has become clear that centralized coordination is needed across the countries and products that are using the brand to drive the business.
BRAND MANAGER AS COMMUNICATION TEAM LEADER
In the old days, the brand manager often just acted as the coordinator and scheduler of tactical communication programs. It was a simpler time, with a limited number of media levers to pull and a simpler charge: generate sales.
Brand builders now face a very different world, a world with a set of communication vehicles that are numerous, complex, and dynamic. Creating and managing an integrated communication program (IMC) is much tougher. Further, the communication task now has a charge beyond sales generation; it needs to build brand assets guided by a clear brand vision in part by strengthening brand associations and customer relationships. Not easy. And the task is made more difficult as increasingly a master brand is spread over products and countries, raising difficult budget allocation decisions.
The brand-as-asset driven communication needs to also generate understanding and buy-in inside the organization, because the brand will only deliver on the brand promise if the employees “believe” and live the brand in all the customer touchpoints. The need is thus to build the brand internally as well as externally.
WHY IS IT HARD?
Why has such a compelling concept been slow to be accepted? And why is it slow to be implemented even when accepted?