International brands and their
management
The World’s top 20 brands
-Interbrand 2006 (click on the link and find out more)
1. Coca-Cola
11. Citigroup
2. Microsoft
12. Marlboro
3. IBM
13. Hewlett-Packard
4. GE
14. American Express
5. Intel
15. BMW
6. Nokia
16. Gillette
7. Toyota
17. Louis Vuitton
8. Disney
18. Cisco
9. McDonald’s
19. Honda
10 Mercedes-Benz
20. Samsung
What are brands?
- visual identities
•
•
•
•
Name
Symbol
Packaging
Strap-line
• E.g ‘Oil of Ulay’ in UK became ‘Oil of Olay’, its
global name
• E.g ‘Marathon’ became ‘Snickers’
What are brands?
-legal property
• In UK we have The Trade Marks Act
(1944)
• European registration can be obtained
thro’ the EU
• International registration can be
obtained thro’ the Madrid Protocol (29
nations only)
• Excludes U.S.A., New Zealand and Australia
The conventional brand model*
• A brand is a product or service made
distinctive by its positioning and its
personality
• Note there is no distinction between
product and service
*Hankinson and Cowking, 1993
Positioning*
• Defines the brand’s point of reference
with respect to the competitive set.
*Hankinson and Cowking, 1993
Personality*
• A unique combination of functional and
symbolic attributes
*Hankinson and Cowking, 1993
Personality*
• Functional attributes:
• Tangible attributes, intrinsic to the product
• For example:
Duracell's products are designed to give you maximum power.
Whatever your power needs, it will last longer with Duracell
*Hankinson and Cowking, 1993
Personality*
• Symbolic attributes
• Intangible attributes, extrinsic to the
product
• For example:
All about Virgin
,
Want to find out how Virgin happened, why we do things differently or what Richard Branson
gets up to in his spare time? Click below to find out everything you ever wanted to know about
Virgin.
*Hankinson and Cowking, 1993
Has this brand got a functional or
symbolic personality?
The branding objective:
The brand - consumer fit
The consumer
The brand
• Physical needs
• Functional attributes
• Psychological needs
• Symbolic values
• A notional budget
• Price positioning
Hankinson and Cowking, 1993
International brand strategies:
-Multi-domestic branding
• To retain local brand loyalty
• Companies which have grown by
acquisition
• E.g.
• 65% of Heinz products do not carry the
Heinz label
• Declining strategy
International brand strategies:
- Corporate brand endorsement
• Typical of growth through acquisition
• E.g.
• Nestle endorses Polo, Buitoni, Herta
(sausages)
• Brands in different markets
• Also as a positioning strategy
• Renault endorses Clio, Laguna, Espace
• Cars for different market segments
International brand strategies
- Monolithic corporate brands
• E.g.
•
•
•
•
IBM
BMW ( with the recent exception of the Mini)
Cathay Pacific
Japanese companies:
• Yamaha
• Mitsubishi
• Honda
• All the top 20 brands are corporate brands
International brand strategies
- Low profile monolithic corporate brands
• Brands aimed at stock markets
• E.g.
• General Motors makes Chevrolet,
Vauxhall, Opel
• Louis Vuitton owns Hennessy, Moet,
Dior, De Beers?
Why corporate brands?
• Maximises brand exposure
• Builds recognition
• Offers all the benefits of brand
stretching...
What does brand stretching do?
• Transfers existing brand knowledge to new
products/services
• Existing brand knowledge
• reduces the consumer’s risk
• reduces distributors’ risks
• reduces launch costs
• Builds brand exposure further
• Enhance sales of other products?
The management of corporate brands*
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•
•
•
Leadership
Culture
Identity
Image
* Hatch and Schultz, 2003
Brand strategy matrix
Product formulation
Standardised
Adapted
Fully Global
Product adaptive
•Coke
•Nike
•Shell
•McDonald’s
Proposition adaptive
Fully adaptive
•Gordon’s Gin
•Nescafe
Factors favouring fully global brands
Dahhringer and Cunliffe 1986
• The use of universal symbols to override
cultural differences
• E.g. Coke uses children/youth
• E.g. McDonald’s uses golden arches
• Regional appeals to a similar culture
• Social segments open to received culture
• Brands with generic national personalities:
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•
•
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Marlboro (American)
Chanel No. 5 (French)
Buitoni (Italian)
Walker’s (Scottish)
Fully global branding does not mean
global advertising
• Different executions can lead to the
same proposition
• E.g. Bacardi (no.1 spirit brand) tailors its
advertising to local markets:
• In Europe it is about sun. sea and sand
• In the U.S. its about health awareness and
diet-consciousness
Characteristics of strong international
brands (Young and Rubicam Brand Power survey)
• Weight (dominance)
• In terms of market share
• Innovation
• Clear brand focus
• Length (stretch)
• Ability to extend into new product markets
• Breadth (brand franchise)
• Demographic and cultural spread
• International appeal
• Depth (commitment)
• Having an intimate relationship with customers
(e.g. ‘cult status’)
• Brand loyalty