Are burgeoning brand portfolios becoming difficult to manage? Is maintaining and strengthening individual positioning platforms for portfolio brands increasingly becoming a challenge? Some of the recent trends in brand architecture seem to be hinting towards the same.
Let’s stop and reflect on a few recent decisions on brand architecture management taken by global brands. Coke embarked on a “one brand” marketing strategy in 2015 and continued its implementation in 2016 through the “Taste the feeling” global campaign. Coke’s justification for embarking on this strategy was that it wanted all its brands to have a single unified positioning. Furthermore, it has been positioned as a move away from the brand per se and towards the product (Coke Life, Coke Zero, Diet Coke, Cherry Coke).
There have been some other notable movements towards single brand architecture recently. Moving away from the world of beverages, we enter the world of enterprise software. In January 2016, SAP CMO Maggie Chan Jones announced that all SAP brands would have a corporate brand endorsement (SAP Ariba, SAP Fieldglass, SAP Hybris, etc.).
Coming back to FMCG, very recently, Hershey announced that it is making a strategic move towards a master brand or corporate brand strategy. Similar and different to Coke’s strategy in equal ways, Hershey is going to move away from all product focused advertising (previously completely unrelated) and focus on strong storytelling in its campaigns.
This need for simplification was long overdue. Have you ever felt a sense of bewilderment standing in the front of a supermarket aisle that has multiple shelves dedicated to shampoos or cookies or crisps? Rate of variant / sub-brand introductions in some consumer goods categories over the years have been like a gravy train running out of control. Clear spaces of opportunities were never identified, and product launches were driven by the sheer thirst to find that 1% additional revenue through the introduction of confusing brand names, equally confusing acronyms for ingredients and misleading or irrelevant positioning. The trigger for Coke to embark on a global shift in strategy were studies that highlighted that consumers do not have any clear understanding of differences in Coke’s portfolio brands.
In addition to the need for simplification in the eyes of the consumers, corporate brand endorsement (where it is strong) can alleviate the need for each and every portfolio brand to have a unique identity and positioning. The Coke and Hershey strategies are based on this principle. It is challenging to develop and maintain unique positioning platforms from multiple angles – creative complexity, costs, challenges of implementation, cultural / language / societal nuances in global markets and the whole external partners ecosystem.
Consider the following examples – According to Hershey’s website, it owns 85 brands under different categories. Many of these 85 brands are sub-brands or variants of a single brand. Coke sells 14 variants of cola in the United States (e.g. Coca-Cola Black Cherry Vanilla, Coca-Cola Cherry Zero, Coca-Cola Life, Coca-Cola Zero, Coca-Cola Zero Caffeine-Free…)
These kind of proliferating brand portfolios are all too common in global organizations. Every small consumer trend or fad leads to a product or variant introduction into the category. Each introduction increases the challenges around product positioning, portfolio optimization, channel strategies, pricing and distribution and marketing / communication planning. All these factors combined shout out the need for “simplification”.
The need for simplification is also driven by the rapidly evolving consumer landscape. If we consider the following facts, it becomes evident that a consumer’s attention span is increasingly becoming more and more fleeting:
- In the current digital lifestyle, our attention spans have shortened from 12 seconds to 8 seconds in a decade, which is shorter than that of a goldfish (Source: research conducted by Microsoft)
- We look at our phones 150 times in a day (Source: Inc.com)
- 57% of consumers actively ignore brands that bombard them with useless information (Source: thedrum.com)
- Average number of products in a supermarket = 35,372; Number of products bought by an average shopper in a year = 260 (Source: Catalina Marketing)
- Tesco (a major UK supermarket chain) plans to offload 30% of the 90,000 different products it stocks from its shelves (number of air freshener variants = 228; number of tomato ketchup variants = 28) (Source: theguardian.com)
The above facts exemplify two trends – consumers are struggling with extremely low attention spans, and they are doing their best to remove confusion and complexity when they have to make choices. Simplifying positioning to focus on the master brand resonates well with current consumer trends.
In addition to unified positioning, one-brand strategies also simplify positioning strategies across the whole brand portfolio. It is a much more efficient process to focus on developing equity through the “taste the feeling” positioning, rather than strengthening product level equity through disparate positioning. It leads to fragmented and diluted marketing and communication strategies, a set of confused creative briefs, a perplexed media and creative agency ecosystem and a wide array of media vehicles to choose from.
The debate around how Diet Coke and Coke Zero fit into Coke’s one-brand strategy is an interesting one. Regardless of the outcome of the debate or the actual sales of the two brands under the new strategy, it is relevant to highlight the closeness in the positioning and the claims of the two brands. This is a typical example of the closeness in positioning between brands that makes portfolio management a difficult exercise.
As brand proliferation increases and consumer attention span decreases, brands will increasingly find it difficult to identify and own unique positioning platforms. In addition to “unique”, “compelling” will emerge as a key differentiator in successful brand positioning. One-brand strategies try to address this critical objective at the top – the master brand. It is akin to going back to a “brand’s roots” or its legacy, which is where a core, strong and focused positioning existed before proliferation and fragmentation diluted its impact.