1. Sustainable Management Session 3 Product and Services – critical relationship with BRAND Ansoff matrix for development decisions Colin Love Director MSc Strategic Marketing

2. The critical relationship with product and services
What its all about !!!!!
BRAND
The critical relationship with product and services

3. Its all about Brands!!

4. European brand spectrum:
Consumers largely unaware of ownership of companies and brands:
DKNY –
Hellman’s Mayo –
Libby’s –
Jaguar –
First Boston –
L’Oreal –
Rimmel -
Rolls Royce –
Calsberg –
Harrods -

5. European brand spectrum:
Consumers largely unaware of ownership of companies and brands:
DKNY – LMVH / France
Hellman’s Mayo – Unilever / UK & Netherlands
Libby’s – Nestle - Switzerland
Jaguar – TATA / India
Santander – Santander / Spain
L‘Oreal – L Oreal / France
Rimmel – Coty / USA
Rolls Royce – BMW / Germany
Calsberg – Calsberg / Denmark
Harrods - was Mohammed Al Fayed sold to Qatar Holdings

6. European brand spectrum:
Now Global in nature
Heritage from UK / USA / Europe
English / American / roman names
Diffusion of tastes and cultures
The brand connects consumer behavior and reaction to products and services

7. Brand Valuation central to marketing
The concept of Brand:
A brand is a name, term, sign, symbol or design which identifies goods and services between sellers and consumers and differentiate them from those of the competition - Kotler
Brand has value as an intangible asset
Intellectual property
Balance sheet goodwill
Trade mark registration
A major company asset – refers to the expected future earnings generated by the companies products and services
Brand Valuation central to marketing

8. Brand versus Products:
Brands are not products
But products / services are branded
We can (and do) brand just about anything
Products / services
People
Ideas
Corporations / organisations
Industries
Countries / regions

9. Brands have specific characteristics:
Attributes – fast / smooth / sexy / aspirational
Benefits – healing / satisfying / performance
Values – corporate symbolism / customer service
Personality – consumer grouping / segmentation / stereotyping – Owner Malcolm Glazer /Tampa Bay Buccaneers

10. The most valuable brands in the world?
The concept of Brand
Brand Equity:
Consumer brand preference – high / low
Consumer brand loyalty – high / low
High ratings relate to high brand equity
Goodwill value on balance sheets
Brand degradation / damage
The most valuable brands in the world?

11. Apple the most valuable brand in the world!!!!!
Worth a staggerin +$182 Billion

12. Strong Brands – Brand Equity:
Strong brands may be described as having brand equity
Brand equity is based on:
Brand awareness
Brand image
We attempt to measure
Brand Asset valuator Model – Y&R
Differentiation – POD
Relevance – to you
Esteem - how well is the brand regarded
Knowledge – understanding of the brand
PLUS
Brand strength – growth potential
Brand stature – current power

13. Sources of Brand Equity: Brand Image
Brand image is based on :
Strength of associations
Favourability of associations
Uniqueness of associations
Heritage

14. Johnnie Walkers heritage

15. Building Brand Equity:
Opportunities and issues in the marketing mix
Product – essentially common - Global products
Price – essentially common, PPP, full transparency in Eurozone
Place – channel commonality
Key issue with PROMOTION
Language variations of all materials and formats

16. Building Brand Equity: Key promotional balance
European big brand advertising is:
Sophisticated
Culturally Stereotypical
Humorous
Story telling
Mysterious
Uses ‘hot buttons’
Has heritage
Can shock
Advertising – brand strategic, Euro centric with language overlays / strap lines
Sales Promotion – brand/sales tactical, locally produced material with local messages / prices / focus

17. NPD – decision making Product life cycle – where are we?
Assessing our current products and services
Making strategic decisions about NPD for future corporate growth
© Imperial College Business School

18. Classic Product life cycle ‘S’ curve
Origin in engineering / innovation diffusion
Classic Product life cycle ‘S’ curve

19. Product life cycle stages:
Development - NPD
Introduction
Growth
Maturity
Decline
© Imperial College Business School

20. Product life cycle stages: Development
A company develops a new product concept
Sales are zero and the activity is a company (marketing) cost
© Imperial College Business School

21. Product life cycle stages: Introduction
A period of slow sales growth and profit investment
Key focus of the marketing mix will be promotion to ‘educate / inform’ the consumer
Development of brand and product awareness
© Imperial College Business School

22. Product life cycle stages: Growth
Rapid market penetration and acceptance
Critical to address channels to the consumer – focus on place within marketing mix
International market expansion
Likely to be the phase where concept moves into profit and passes breakeven
Competitors likely to enter the market space
© Imperial College Business School

23. Product life cycle stages: Maturity
Reaching market potential or saturation
Profits peak and may be under threat by marketing mix activity required to defend product against competition
Focus of marketing mix on product and services to develop variants / extensions to maintain product differentiation
© Imperial College Business School

24. Product life cycle stages: Decline
Concept may be ‘dated’, with competition fierce
Sales and margins decline, last opportunity to extract value possibly through price discount action in marketing mix
Danger of brand / company reputation
© Imperial College Business School

25. Integrating PLC into corporate strategy
The Boston Consulting Group analysis
classifies Strategic Business Units according to growth / share of markets – directly attributable to product and services
Ansoff Matrix
Focus on product and services and market expansion opportunities
Taking existing available p&s to new markets
Developing new p&s directions
© Imperial College Business School

26. Relative Market Share – cash generation
Boston Matrix
Relative Market Share – cash generation
H L
STAR Question Mark ?
L H
Market Growth Rate – Cash Usage
CASH COW DOG

27. Overlaying BCG on the PLC? ?

28. Ansoff Matrix – extensions and development of PLC
Market penetration – using marketing mix to expand existing product sales - price and promotion
Market development – growth by identifying new market segments for existing products – can include international expansion
Product development – developing modified or new products to current market segments – product focus
Diversification – developments outside current companies products or markets – very high risk
© Imperial College Business School

29. Develop an Ansoff Matrix strategic review:
Group 1
Louis Vuitton
Group 3
Microsoft
Group 2
eBay
Group 4
Toyota
Group 5
EDF
© Imperial College Business School

30. Case study:
ISS: developing a Breakthrough Service Strategy to Drive Profit and Growth
© Imperial College Business School