PROJECT REPORT

ON
BRANDING STRATEGY
&
PRODUCT DEVELOPMENT

PRODUCT
What Is a Product ?

Products can be considered . . .

Tangible – physical entity or service
Extended – tangible product plus a whole cluster of services that accompany it
Generic – the essential benefits the buyer expects to receive from the product

A product is anything that can be offered to a market to satisfy a want or need.

Products that are marketed include physical goods, services, experiences, events,
persons, places, properties, organizations, information, and ideas.

BRAND
What is Brand?

A brand represents the holistic sum of all information about a product or group of
products. This symbolic construct typically consists of a name, identifying mark,
logo, visual images or symbols, or mental concepts which distinguish the product
or service. It is useful for the marketer to think of this as a set of aligned
expectations in the mind of its stakeholders -- from its consumers, to its
distribution channels, to the people and companies who supply the products and
services.

It is a name, term, design, symbol, or any other feature that identifies one seller's
good or service as distinct from those of other sellers. The legal term for brand is
trademark. A brand may identify one item, a family of items, or all items of that
seller.

A brand is a product from a known source or organization. The name of the

organization can also serve as a brand. The brand value reflects how a product's
name, or company name, is perceived by the marketplace, whether that is a target
audience for a product or the marketplace in general (clearly these can have
different meanings and therefore different values). It is important to understand
the meaning and the value of the brand (for each target audience) in order to
develop an effective marketing mix, for each target audience.

PRODUCT DEVELOPMENT AND RELATED

BRANDING STRATEGIES
A good marketing strategy helps the product attain the market position that the
management desires. A complete statement of marketing strategy for a product
consists of seven parts:

a) Statement of objective
b) Selection of strategic alternatives
c) Selection of target customers
d) Choice of competitor targets
e) Statement of the core strategy
f) Description of supporting marketing mix.
g) Description of supporting functional programs

Hierarchy of Objectives:
Company mission/vision

Corporate Objective

Corporate Strategies

Divisional Objectives

Divisional Strategies

Product/Brand Objectives

Brand Strategies
 Program Objectives

Tactics

Branding Strategies and Product Brand Strategies go hand in hand and are based
on the company’s vision and strategic decision. The product is developed keeping
in mind the objectives, vision, mission and strategic intent of the company. And to
supplant and supplement the growth of the product, the branding strategy is
carried out accordingly.

An organization has a variety of objectives with mission or vision and ranging

from corporate to product. It’s rare that managers employ a growth objective
without some consideration of its impact on the product’s profits. One of the
important objectives set for a product is cash flow. But this is dependent on the
market share and market penetration. These requirements in turn are dependent on
the way consumer associate themselves with the product or in other words, there
is minimum noise between product identity and product image. Now, what plays
an instrumental role in the achievement of this during the product development is
the “branding strategy”.

Igor Ansoff Strategy

PRODUCTS

Present New

Market Product
Present
MARKETS

Penetration Development

New Market
Development Diversification
The output from the Ansoff product/market matrix is a series of suggested growth
strategies that set the direction for the Branding strategy with respect to the
product. And branding strategy depends on many variables which are described
below:

Market penetration

Market penetration is the name given to a growth strategy where the business
focuses on selling existing products into existing markets.

Market penetration seeks to achieve four main objectives:

• Maintain or increase the market share of current products – this can be achieved
by a combination of competitive pricing strategies, advertising, sales promotion
and perhaps more resources dedicated to personal selling

• Secure dominance of growth markets

• Restructure a mature market by driving out competitors; this would require a

much more aggressive promotional campaign, supported by a pricing strategy
designed to make the market unattractive for competitors

• Increase usage by existing customers – for example by introducing loyalty

schemes
A market penetration marketing strategy is very much about “business as usual”.
The business is focusing on markets and products it knows well. It is likely to
have good information on competitors and on customer needs. It is unlikely,
therefore, that this strategy will require much investment in new market research.

Market development

Market development is the name given to a growth strategy where the business
seeks to sell its existing products into new markets.

There are many possible ways of approaching this strategy, including:

• New geographical markets; for example exporting the product to a new country

• New product dimensions or packaging: for example

• New distribution channels

• Different pricing policies to attract different customers or create new market

segments

Product development

Product development is the name given to a growth strategy where a business

aims to introduce new products into existing markets. This strategy may require
the development of new competencies and requires the business to develop
modified products which can appeal to existing markets.

The Product Life Cycle and Related Decisions

STAGES
Introduction Growth Maturity Decline

Sales
Volume

Should the Should the

Should the product strategy
product be product be
introduced be changed deleted

Each stage in a product life cycle calls for a different kind of strategy. The points
below throw light on the relevance of various factors during the four stages
introduction, growth, maturity and decline.
Introduction Stage of the PLC

Summary of Characteristics, Objectives, & Strategies

Sales Low sales

Costs High cost per customer

Profits Negative

Marketing Objectives Create product awareness

and trial
Product Strategy Offer a basic product

Price Strategy Use cost-plus

Distribution Strategy Build selective distribution

Advertising Strategy Build product awareness among early

adopters and dealers

As we can see in the introduction stage, the product strategy is to offer the basic
product using cost plus aspect. The strategy for distribution is selective and the
company aims to build product awareness among early adopters and dealers for
the product to get well registered with the targeted segment.
 Growth Stage of the PLC

Summary of Characteristics, Objectives, & Strategies

Sales Rapidly rising sales

Costs Average cost per customer

Profits Rising profits

Marketing Objectives Maximize market share

Product Strategy Offer product extensions, service, warranty

Price Strategy Price to penetrate market

Distribution Strategy Build intensive distribution

Advertising Strategy Build awareness and interest in the

mass market

In the growth stage, the product strategy is to offer product extensions, service and
warranty to reward existing customers. Similarly the price is such that it helps the
product penetrate deeper into the market and establish itself. The advertising
people aim at building awareness and interest mass market.
Maturity Stage of the PLC

Summary of Characteristics, Objectives, & Strategies

Sales Peak sales

Costs Low cost per customer

Profits High profits

Marketing Objectives Maximize profit while defending

market share
Product Strategy Diversify brand and models

Price Strategy Price to match or best competitors

Distribution Strategy Build more intensive distribution

Advertising Strategy Stress brand differences and benefits

The idea here is brand and model diversification. The company tries to match its
competitors in terms of price. The distribution is made more and more intensive.
The advertising department stresses brand differences and benefits to make its
products stand out in the market. This is also a stage where the company can make
maximum profit out of its product.
Decline Stage of the PLC

Summary of Characteristics, Objectives, & Strategies

Sales Declining sales

Costs Low cost per customer

Profits Declining profits

Marketing obj Reduce expenditure and milk the brand

Product Strategy Phase out weak items

Price Strategy Cut price

Distribution Strategy Go selective: phase out unprofitable

outlets
Advertising Strategy Reduce to level needed to retain
hard-core loyal customers

During the decline phase, the company gradually phases out the weak items and
cuts price. Distribution too is selective. The company gets rid of all unprofitable
outlets and focuses on the remaining profitable ones to generate whatever income
it can. The company, through advertising, comes down to the level which is
needed to retain hard core loyal customers.
 WHY BRANDING STRATEGY IN PRODUCT
DEVELOPMENT?

 Provides a framework for properly selecting markets and product ideas and
targeting the customer accordingly
 Customers and potential customers are identified
 Map company position against competitors in various dimensions to
provide insights and help develop strategy
 Work with the executive team to assess markets, competition, competitive
strengths, and product lines and design the communication accordingly and
use integrated communication.

Dimensions of Branding Strategy

Product Positioning

The idea of 'positioning' a product or service emerged in the early 1970's when
Al Ries and Jack Trout wrote a series of articles called 'The Positioning Era'
for Advertising Age.

“….positioning is not what you do to a product. Positioning is what you do to

the mind of the prospect. That is, you position the product in the mind of the
prospect.”

Placing a brand in the market where it will have a favorable reception

compared to competing products. It is the act of designing the company’s
offering and image to occupy a distinctive place in the target market’s mind.

"Positioning is the attempt to control the public's perception of a product or

service as it relates to competitive products."

Generic Positioning Strategies

 Our product is unique

 e.g. Raffles Hotel (oldest hotel); Westin Hotel (tallest hotel)
 Our product is different
 Listerine (kills germs)
 Amex Blue credit card (6-month rate of 15.9% vs the market rate of
24%)
  Our product is similar

Approaches to Positioning

 By attributes
 e.g. Singapore Airlines (first class comfort)
 By benefits
 e.g. Citibank Credit Card (7/24 availability)
 By price/quality e.g. Proton
 By usage or application e.g.100Plus (fluid replenishment in sports)
 By users e.g. Johnson Baby Shampoo; J&J Affinity Shampoo (hair
conditioner for women)
 By product class
 e.g. Camay soap (with bath oils—not just soap)
 By competitors e.g. Avis against Hertz

Competing Brands

 Company competes with its own brand

 Multiple brands overall sales has higher market share than one brand
 Cannibalism can occur
 New brand is improved product
 Old brand dies
 e.g. Gillette Atra, Sensor, Mach 3 after new brand is established

Private label

 Product manufactured under another firm’s brand name

 House brands owned by wholesaler or retailer

Strategic Branding in Product Development

A Brand is more than just a product name: a brand is a covenant with the
consumer. It must convey a series of expectations, a certain predictability which
we call "Brand Character."
Developing a brand strategy can be one of the most difficult steps in the marketing
plan process. It's often the element that causes most businesses the biggest
challenge, but it's a vital step in creating the company identity.
Your brand identity will be repeatedly communicated, in multiple ways with
frequency and consistency throughout the life of your business.
To begin the development of your brands strategy you must have an understanding
of these four marketing components:
• Primary Target Customer and/or Client
• Competition
• Product and Service Mix
• Unique Selling Proposition
By identifying these components of your marketing plan you have created the
basis for crafting your brand strategy. An effective branding process will create a
unique identity that differentiates you from the competition. That is why it's often
deemed as the heart of a competitive strategy.

The Delphi Process:

This process of branding a product was outlined by Jacques Chevron in 1985. Our
branding approach is based on a 4 step process:
• Determine the Brand's character
• Organize for character consistency
• Develop a brand strategy
• Implement the strategy
Products may change, advertising can evolve, but brand character must remain
steady for a long period of time to have a chance to be recognized. For this reason
it is essential that the brand's character be rooted in the values and beliefs of the
corporation and of its long term players.

The objective of this first step is to discover the perennial temperament and
character traits that will provide continuity to the brand and to elaborate a Brand
Character Statement that will embody what the brand stands for.

Writing a Brand Character Statement is more art than science, includes more
shades of gray than black and white, and owes more to the compromises of
diplomacy.
This step is also essential to the success of the project: There needs to be a
procedure to ensure that the brand's character is understood and respected around
the world by anyone who speaks for the brand.

This is accomplished by the institution of a well publicized review and approval

process which will verify that the brand's messages consistently conform to the
brand's character statement. This process is led by a senior corporate officer who
acts as the "Brand Parent." The Brand Parent will also have the overall
responsibility for explaining what the Brand Character Statement is and for
training people on its use.

The Brand Parent should preferably not be the senior marketing executive: It is
important that his role be separate from that of reviewing the brand's strategies and
tactics.

This is a very difficult position. While we look at the institution of a Brand

Character Statement as an instrument of guidance which defines parameters of
freedom, one should expect some resentment from local executives and their
advertising agencies. The Brand Parent must be apt at, and prepared for playing
this role of diplomatic enforcement.
During this step, the Brand Parent begins to play his role of apostle of the Brand
Character: He should organize several regional conferences to explain the role and
the purpose of brand character, and train local marketing staff on its use and on the
review and approval procedure to ensure it is respected.

Part of the training and of the selling process consists of helping the local
marketing staff do a local brand character evaluation and determine the gap that
exists between the intended global character and local reality. They will then be
asked to develop a strategy to bring the local character more in line with the one in
the Brand Character Statement.

Management strategies
It is important that the implementation of the Brand Strategy be thought through
from the beginning of the process. Ways to measure the progress made in
establishing Brand Character should be agreed to from the onset
Incentives should be given for reaching the goals agreed to before starting, etc.
 CONCLUSION
In an increasingly competitive world market, a key component of a healthy
product line is often the brand that accompanies it. As valuable assets of a
business organisation, they realistically demand the same level of attention as the
equipment in a factory or the money placed in lucrative investments. While
branding programmes are industry and product specific, the basic steps necessary
to sustain underlying marks demonstrate some consistency.

An overall brand strategy should only be implemented with full recognition that
the brand may traverse numerous different product lines and geographic regions.
Effective brand management strategies also necessitate emphasis on ensuring
consistency between the brand licensing strategy and the enterprise’s overall
business goals. Efforts should be undertaken to ensure that the brand reflects
positively on the company, does not detract from other product lines and remains
profitable with other parts of company.

Companies should be active – and not static –when undertaking efforts to integrate
the brand strategy into product development and launch activities. A clear and
proactive strategy is likely to generate the most reward. Business organisations
must respect the brands that support products and services as dynamic assets
worthy of attention from top management. While the priorities may shift among
the foregoing recommendations from time to time, they all play a role in
developing sand sustaining a successful strategy.