As a Brand manager, you could have to deal with various brands that fall under the same roof, each with its own identity, positioning, and target market. This is known as a brand portfolio, and it can be an effective tool for maximizing synergies, reducing risks, and gaining market share. However, it can also present specific difficulties, such as conflicts and crises, which might undermine your reputation and brand equity. Competing brands can have beneficial and detrimental effects on a brand portfolio. How do you manage these circumstances while defending your brand portfolio? Here are some ways in which contradictory brands can affect
Affecting Brand Portfolios
- Diversification and Market Reach
Targeting various market groups, customer inclinations, and conflicting brands can aid in extending the reach of a brand portfolio. A brand portfolio can gain a larger market share and satisfy a broader range of consumer needs by providing a variety of brands with distinct positioning and target audiences. Through this diversification, we can reduce the dangers associated with relying too heavily on a single brand, which can increase market penetration.
Coca-Cola has broadened its product line to include sparkling soft drinks, water, sports drinks, and ready-to-drink coffee and tea beverages to fight the fall in soda consumption, which has helped it dodge the harshest effects. Adding new goods or services linked to or valuable additions to your current offerings is another aspect of related diversification. For instance, a car manufacturer may expand into electric automobiles, or a clothes company might expand into accessories.
- Consumer Confusion
Consistent brands within a portfolio can occasionally need clarification among consumers. Customers could need assistance comprehending the brand’s overall identity when brands within the same portfolio have competing messages, positionings, or brand values. This disarray may reduce the brand effect, weaken customer loyalty, and make developing a unified brand identity easier.
Unilever India has a large portfolio of tea brands. It has brands like Brooke Bond 3 Roses, Brooke Bond Red Label, Brooke Bond Taaza, Brooke Bond Taj Mahal, etc. Differentiating the different variants can be a source of consumer confusion. Another reason for consumer confusion remains the ‘packaging design’, if it fails to clearly communicate the differences between the variants.
- Cross-Promotion and Synergy
Competing brands might exploit cross-promotion and synergy opportunities in a brand portfolio. A portfolio can gain from shared resources, economies of scale, and increased brand visibility by proactively aligning and integrating marketing efforts across competing brands. Cross-promotion can encourage brand research and potential cross-selling opportunities by introducing consumers to the brands in the portfolio.
- Reputation and Trust
Conflicting brands can affect a portfolio’s overall significance and trust. It can damage the importance of the entire portfolio if contradictory brands within it are poorly viewed or are inconsistent in upholding their brand commitments. Building and sustaining consumer confidence is essential to overcome mistrust and secure the portfolio’s long-term performance.
Contradictory brands can help you adjust and be flexible in shifting market conditions. They can also help the portfolio react swiftly and successfully to new trends or changes in the market environment as consumer tastes change. A portfolio can maintain relevance in a changing market by being agile enough to change brand positioning or add new brands.
Over the years, Toyota has established a reputation for dependability, quality, and innovation in the car industry. The Toyota Prius and Toyota Land Cruiser, two of their most well-known and distinctive products, represent this reputation in diverse ways and have gained customers’ confidence for numerous reasons. The Prius appeals to environmentally conscious consumers looking for a dependable and sustainable driving experience, representing the brand’s dedication to environmental conscience, fuel efficiency, and safety. The Land Cruiser, on the other hand, epitomises Toyota’s tradition of toughness, off-road capabilities, and luxury, appealing to adventurers and those seeking a balance of roughness and elegance.
Toyota has earned a reputable name among customers all over the world by consistently putting a strong emphasis on quality, safety, and innovation. Whether it’s the eco-friendly efficiency of the Prius or the off-road dominance of the Land Cruiser, Toyota’s commitment to building reliable and innovative vehicles continues to win the trust and loyalty of customers globally.
- Portfolio Rationalization
Competing brands may prompt the need for portfolio rationalization, and evaluating the brand line-up could be important if contradictory brands don’t provide value or fit the portfolio’s overall strategy. Eliminating inconsistent or underperforming brands from the portfolio can help concentrate resources, promote brand coherence, and improve the competitiveness of the portfolio as a whole.
Unilever, one of the biggest manufacturers of consumer goods in the world, is renowned for its enormous and varied brand portfolio, which includes a wide range of items in many different categories. The business recently undertook brand portfolio reduction by determining its core categories and brands, assessing brand performance, simplifying packaging and communication systems, and merging and divesting existing brands.
To increase efficiency and profitability, Unilever reduced its portfolio by selecting key categories and concentrating on brands with strong growth potential. Unilever made the best use of its resources through divestitures, acquisitions, and an emphasis on brand performance, ensuring that every brand contributed to its overall success. Additionally, by reducing communication and packaging, Unilever strengthened its brand identity and improved customer familiarity.
Overall, Unilever’s brand portfolio rationalization demonstrates how a well-executed strategy can create a leaner, more focused brand portfolio, positioning the company for sustained growth and competitiveness in the ever-evolving consumer goods industry.
Managing Contradictory Brands Within A Brand Portfolio
Managing contradictory brands within a brand portfolio requires strategic planning and careful execution. Here are some key considerations and approaches.
- Clarify Brand Positioning
Identify each brand’s positioning within the portfolio and target market. Ensure each brand has a unique identity, value proposition, and personality compatible with its intended market. There will be less overlap between competing brands, which will reduce confusion.
- Segment the Target Audience:
Identify and comprehend the many groups that comprise the target audience. Choose the opposing brands that cater to particular constituencies and adjust your marketing and communication efforts accordingly. This segmentation strategy enables targeted communications and helps prevent message dilution or conflict throughout the portfolio.
Segmenting the target audience is an essential marketing tactic that enables businesses to customize their marketing messages, product offers, and distribution tactics, resulting in more effective resource usage and higher customer involvement.
Auto manufacturers divide their target market into subgroups based on demographics like age, income, employment, and family size. Geographical elements such as climate, topography, and urban vs. rural settings are frequently considered.
Effective marketing demands an understanding of consumers’ attitudes, interests, and lifestyles. While some automakers appeal to ecologically sensitive people by selling hybrid or electric vehicles, others target thrill-seekers with rugged and fast SUVs.
In contrast, soft drink firms divide their customer base according to factors including age, gender, income, and stage of the family life cycle. Different geographic areas may have diverse tastes for flavours and ingredients in the soft drink business. Soft drink companies frequently market to people based on their beliefs and way of life. Brands like Red Bull, for instance, may appeal to active and adventurous folks looking for an energy boost, whereas natural and organic soda brands cater to health-conscious consumers.
Market segmentation is a valuable tool for identifying and serving particular customer groups in the automobile and soft drink sectors. These sectors may create and promote goods that connect with customers personally by knowing their target audience’s varied requirements, tastes, and behaviours.
- Maintain Consistency in Core Brand Values
Even though opposing brands may have diverse positioning, upholding consistency in the portfolio’s core brand values is crucial. Even though the individual brands may have various qualities, the character across the portfolio of brands produces a cohesive look and increases consumer trust.
The same company, Bru, a well-known coffee brand in India, sells both Bru Instant and Roasted Ground Coffee, two different coffee products. Bru has effectively kept its fundamental brand values consistent throughout both product lines, despite the variations in preparation and flavour.
A testimony to Bru’s proactive brand management is its dedication to consistency in essential brand values throughout its Instant and Roasted ground coffee products. While remaining loyal to its brand idea, Bru can serve various coffee lovers by emphasizing quality, flavour, accessibility, innovation, and brand image.
Consistency doesn’t mean offering identical products but upholding the values and promises defining the brand. Bru showcases how a brand can evolve and adapt to changing market dynamics while remaining committed to its essence, building lasting customer loyalty and trust.
- Separate Marketing and Communication Channels
Consider using various marketing and communication channels for opposing brands. By utilizing this strategy, it is made sure that each brand gets a special place to convey its narrative without producing any misunderstanding or dilution. Maintaining clarity and enabling customized marketing plans for each brand are two benefits of separating the media.
- Cross-Promote Shrewdly
While looking for inconsistencies, locate strategic opportunities for portfolio-wide cross-promotion and synergy. Promote comparable features or goods from competing brands to raise awareness and encourage interaction. However, watch out that the positioning and messaging don’t conflict with or mislead customers.
- Monitor and Manage Consumer Perception
Keep a close eye on consumer opinions and perceptions of each brand in the portfolio. Be aware of how people feel about the brands alone and together. To preserve a positive brand portfolio image, immediately deal with contradictions or unfavourable opinions and change brand tactics.
- Assess Portfolio Rationalization
- Regularly assess the effectiveness and utility of competing brands across the portfolio.
- Analyze whether the advantages of retaining competing brands exceed the potential disadvantages.
- Consider rationalizing the portfolio by eliminating or repositioning a competing brand if it fails to support the broader portfolio strategy or causes confusion.
- Leverage Brand Architecture:
Use a strong brand architecture plan to direct the portfolio’s hierarchy and relationships between opposing brands. Ascertain whether a branded house, a house of brands, or a hybrid strategy best serves the particular contradicting brands. Clarifying relationships and bolstering portfolio coherence are achieved with a clear brand architecture.
By applying these strategies, brand portfolio leaders can effectively navigate the challenges of overseeing and supervising contradictory brands. Balancing the distinct identities of each brand while maintaining a unified portfolio will improve market positioning, customer perception, and overall brand performance and implementation.
One of the biggest hotel chains in the world, Marriott International, is a shining example of how to use brand architecture to build a potent and unified brand portfolio. Marriott, which has several hotel brands under its wing, has adopted a well-structured brand architectural plan to cater to various consumer groups and satisfy multiple travel requirements.
By utilizing this carefully thought-out brand design, Marriott International successfully responds to many client demands while upholding uniform standards for quality and service throughout its portfolio. The corporate brand of Marriott International inspires confidence and dependability, while the authorized and individual brands provide distinctive experiences catered to various visitor demographics.
Marriott’s brand architectural strategy has enabled the corporation to grow its worldwide reach while ensuring that each hotel brand it manages has its positioning and personality. By catering to various consumer tastes and building strong brand loyalty throughout its portfolio, this unified approach to brand design has improved the overall Marriott brand and allowed the firm to become a leader in the global hospitality sector.
Conclusion
In summary, contradictory brands can impact brand portfolios in various ways, ranging from diversification and market reach to potential consumer confusion and reputation challenges. Effectively managing contradictory brands requires careful positioning, strategic alignment, and a clear understanding of the target audience’s preferences, and brand portfolio leaders can effectively navigate the challenges of overseeing and supervising contradictory brands. Balancing the distinct identities of each brand while maintaining a unified portfolio will improve market positioning, customer perception, and overall brand performance and implementation.
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