Learn Strategic Brand Management
Brand Equity In Question
Strategic Implications Of Branding
Brand And Business Building
From Private Labels To Store Brands
Brand Diversity: The Types Of Brands
The New Rules Of Brand Management
Brand Identity And Positioning
Launching The Brand
The Challenge Of Growth In Mature Markets
Sustaining A Brand Long Term
Adapting To The Market: Identity And Change
Growth Through Brand Extensions
Handling Name Changes And Brand Transfers
Brand Turnaround And Rejuvenation
Managing Global Brands
Financial Valuation And Accounting For Brands
This is the second version of the umbrella brand. At first glance, in formal terms, nothing distinguishes it from the previous version: the company still accepts only a single brand for the whole, and consequently imposes descriptive names for the products and services or divisions and branches. Here we find sub-brands.
In practice, however, a gulf separates these two outworkings of the umbrella brand. Here the parent brand is mistress: it provides not just a name, but a frame of reference behind which everything should align, in order eventually to become the embodiment of it, the living spokesperson. Here the brand is the surrounding framework. This is the clearest example of what we call a ‘branded house’.
The masterbrand prototype is Nivea. A Nivea product or communication can be recognised at a glance. Nivea is active in a large number of categories: moisturising creams, sunscreens, deodorants, shampoos, beauty products and make-up. Everywhere, in each of its categories, it faces specialist brands.
It counters these with products embodying its two central values, ‘love and care’. This embodiment begins with the composition of the products themselves, their harmlessness, their softness, and extends to the manner in which they are communicated. Everythings codified in a centralised manner.
The masterbrand is strong because it brings together a broad offering of products under highly differentiating common values. At Nivea, the categories are each sold under a variant of the name Nivea and a descriptor of the function or target. In this way, we have Nivea Body, Nivea Sun, Nivea Hands, Nivea Visage and so on.
Other examples of this strategy are found in B2B, where there are strong brands such as Legrand and Hager for low-voltage electrical appliances.
The encompassing umbrella architecture is also known as masterbrand. The name ‘masterbrand’ implies a guardian of the temple: a person, judge or authority capable of policing, not dissident logos but projects, innovations and even advertisements that do not fully embody the brand’s central values, since these are what dilutes its promise. The brand is only as strong as its weakest link.
The brand power conferred by this architecture, when properly implemented, is remarkable. It offers economies of scale linked to the variety of products and markets that the brand can cover while creating a brand identity (that is, a group of values that are highly differentiating and relevant in each of its markets).
Korean companies, which 20 years ago were content to imitate Japanese groups, even to their practice of the flexible umbrella brand, have acquired a strong global image by changing their brand architecture. LG has a clear brand platform that is imposed on all divisions and countries. The same is true for Samsung.
In Europe, since 2004, Philips has been attempting to become a masterbrand, a strong surrounding framework. The new managing director has installed a new ‘One brand’ motto for all the divisions of this global group. It is difficult to imagine the cultural revolution created in this company by such an apparently simple declaration. Let us consider how it will differ from the situation before 2004, as I learnt in the Netherlands on a consultancy trip:
However, one cannot build a mega-brand by balkanising it. It needs a platform (central values, core identity), and support at the highest levels of management. The products, divisions and branches must reposition themselves in order to present the central values of the brand at home and abroad. Hence a study was carried out to define the platform of the Philips brand and consider its consequences both at the level of the new products and services to be created, and at the communications level.
Source brand strategy
This is identical to the umbrella brand strategy except for one key point – the products have their own brand name. They are no longer called by one generic name such as eau de toilette or eau de parfum, but each has own name, eg Jazz, Poison, Opium, Nina, Loulou, etc. This two-tier brand structure, known as double-branding, is shown in Figure below.
Source brand or parent brand strategy
Since this strategy is often confused with the endorsing brand strategy, it is important to specify the differences at the beginning. When Nestlé puts its name on the chocolate Crunch and Galak, on the bars Yes, Nuts and Kit Kat and on Nescafé, Nesquik, etc, the corporate brand is endorsing the quality of the merchandise and acts as a maker’s mark. The Nestlé name dispels the incertitude that certain products can create.
Nestlé takes a back seat position. The product itself is the driver of the consumers’ choice; it is the hero to the extent that few customers of Crunch attribute it to Nestlé. On the contrary, when we see the Yves Saint Laurent name on a perfume such as Jazz, this name is more than a simple endorsement. Here, it is the brand name which holds sway and which accords Jazz the seal of approval and the distinction which it would not otherwise enjoy.
Yves Saint Laurent is the driver of purchase, not Jazz. Jazz is another key to the door of the Yves Saint Laurent cultural universe. The problem with many brands is that they have converted from source brands to endorsing brands. Within the source brand concept, the family spirit dominates even if the offspring all have their own individual names. With the endorsing brand, however, the products are autonomous and have only the endorsing brand in common. Today, where do Nestlé, Kellogg’s or Kraft stand? What about Du Pont or Bayer, Glaxo or Merck?
The benefit from the source brand strategy lies in its ability to provide a two-tiered sense of difference and depth. It is difficult to personalise an offer or a proposition to a client without any personalised vocabulary. The parent brand offers its significance and identity, modified and enriched by the daughter brand in order to attract a specific customer segment. Ranges having ‘Christian names’ allow a brand which needs to maintain its own brand image to win over newer consumer categories and new territory.
The limits of the source brand lie in the necessity to respect the core, the spirit and the identity of the parent brand. This defines the strict boundaries not to be infringed as far as brand extension and also product communication are concerned. Only the names that are related to the parent brand’s field of activity should be associated with it. All product aids should share the same spirit. If greater freedom is sought, then the endorsing brand strategy is more suitable.
Garnier for example wanted to become a source brand and abandon its previous endorsing brand strategy. This is a delicate process for it means moving from patchwork to unity.
Creating a source brand: from patchwork to unity
Companies need to improve their efficiency on a regular basis. One way of doing this is to put an end to the natural dispersion of brands and identities, and reorganise supply under proper parent brands that fulfil more than an endorsing function. These parent brands would be a source of strong, differentiated and unique values shared by all products and subbrands, which also have their own particular personality based on their target group, product territory and specific function.
What the present work refers to as a ‘source brand’ partly corresponds to what some people have called a ‘branded house’ (as opposed to a ‘patchwork’ or ‘house of brands’). It should be remembered that, unlike the umbrella brand, the source brand is a strategy with two layers of branding.
So how does a company convert a ‘patchwork’ into a real ‘house’? The first thing it has to do is define the identity of the brand for the future. The real identity of a brand lies within the brand itself, while its future lies in its ability to adapt to the markets. It is therefore by analysing the roots and origins of the brand, its early products and performance that it is possible to isolate its core, its key values, the source of its influence and legitimacy. But this analysis must then be considered carefully within the context of the development of tomorrow’s markets and consumers.
Garnier provides a good illustration of this process. Until 2002, this internationally renowned brand was known as Laboratoires Garnier. Its task was to become the other international brand of the mass-market network, alongside l’Oréal Paris, which was positioned as a more glamorous, more expensive product within the same shelf ranges. It was a question of finding values that were positive, aspirational, internally and externally motivating, and had popular appeal since the brand had been allotted a more accessible market position.
Historically speaking, the origins of Laboratoires Garnier date from 1904, when M. Garnier first invented a herbal hair tonic. This original product already had some of the key attributes of the brand – naturalness and beauty care. Some time later, after the Second World War, a hugely successful shampoo called Moëlle Garnier not only revitalised the ‘genes’ of the brand but also boosted business. Relaunched in 1986, the brand was extended by its sub-brands – Synergie (cosmetics), Ambre Solaire (sun care), Graphic (hair care), Ultra Doux (skin care) and Lumia (hair colour).
The brand achieved international renown and established a strong position on several European markets. However, its sub-brands declined in popularity and remained regional. All except one, that is, which had already been extremely successful outside Europe and appealed to the younger generation in countries throughout the world – Fructis, the first strengthening shampoo with active fruit concentrates.
Fructis was a direct descendant of the Garnier line but with a more modern image. The real reinvention came with Fructis Style, a range of revolutionary styling products containing fruit wax and characterized by a complete range of strong, tactile sensations – the colours, consistency and aroma of fruit. With Fructis, a new generation of sensual products was born.
But to conquer the world market the brand needed a new identity that, while respecting its origins, would nevertheless make it an aspirational brand for modern young people worldwide. Fructis and especially Fructis Style would be the new prototype for the brand, while their casual and ironic tone would provide the basis for its reinvention.
What were the consequences for Garnier? In order to be attractive and accessible to young people in countries throughout the world, the brand had to change its name from Laboratoires Garnier and simply become known as Garnier. It was no longer a scientific or a French brand, it was accessible and international. Furthermore its brand contract, its values, were now written in English.
How does Garnier define its aims? ‘Garnier believes in beauty through nature. Scientifically developed and enriched with selected natural ingredients, our products help you look healthy and feel good every day.’ This contract is outlined in six core values:
Apart from modifying the name, a new logo was created in green, orange and red, the colours of fruit but also traffic lights
From this it can be seen that the source brand is a structure that restructures all its parts. Many groups use this type of brand architecture to give greater impact to their diverse product ranges by making them converge on a common image. For example, all Danone products and brands now focus on health, the core value of the source brand, in the knowledge that there are seven types of health, and therefore seven different ways of presenting it. Danone has also changed its status from an ‘endorsing brand’ to a ‘source brand’.
The six branding strategies presented here are models, typical cases of branding. In reality, companies adopt mixed configurations where the same brand can be, according to the product, range, umbrella, parent or endorsing brand. For example, l’Oréal is a range brand of lipsticks. It is a source brand for Studio, Elsève or Plénitude.
The hybrid character of the usage of the brand l’Oréal and the strategies adopted reflect its willingness to adapt to the decision-making processes of consumers in different sub-markets (hair care products, perfumes or cosmetics) or according to thedistribution channels (ie self-service or specialist stores).
In certain cases, l’Oréal guarantees reliability and technical capacity. In others, it wants to achieve recognition (ie in cosmetics) and therefore needs to place itself to the forefront. And finally, in still other cases, l’Oréal has to be invisible – either to avoid being associated with a low-price segment or to avoid hurting one of its prestige products. Nevertheless, many hybrid situations result out of the series of small decisions that are taken as and when a new product is launched. Due to the lack of an overall plan for a brand’s relationship with its products, a number of non-coherent branding decisions often exist side by side.
3M provides an interesting example of the accumulation of separate branding policies, with as many as five denominational stages (quintuple branding). This is shown in Figure below. 3M is a company focused on high-tech research into industrial and domestic applications of adhesives. This covers a vast area which includes glues, obviously, but also films, cassettes, medical plasters, transparencies and overhead projector products, etc.
The 3M name is synonymous with seriousness, power and heavy R&D. But this also leaves an image of coldness. Thus, to humanise the contact with the general buyer, the umbrella brand Scotch was created. Video cassettes, glue sticks and sellotape are all branded Scotch directly. But for the scouring pads, on the other hand, a line brand called Scotch-Brite was created.
To counter the challenge of a rival product from Spontex (who simply call them scouring pads) Scotch replaced the generic name by a particular name, the ‘Raccoon’ (just like the Volkswagen Beetle). This differentiated its product and explained its advantages in a unique manner and gave it a closer and more friendly image.
A case of brand proliferation and dilution of identity
The ‘Raccoon’ itself has been expanded into many versions – green, blue, red – depending on its shape and use. For its general consumer products, such as sponges and glues, 3M was used as an endorsing brand with a signature in small print. Curiously enough, 3M is scarcely in evidence on Scotch cassettes.
Is this to distinguish better from the video cassettes marked clearly and exclusively 3M and targeted at professional use? In fact, while 3M provides a guarantee of good performance and an endorsing brand for general consumer products, it serves as an umbrella brand for professional products: all the power and significance of the 3M name is reflected in products such as cameras, overhead projectors and dental cement (coming from the 3M health division).
Post-it, the famous ‘adhesive notes that serve as a memory tool or a message carrier’, is also signed 3M. In order to patent this invention in a better way and to define it in a better manner than the long description used above, that it be given a proper name was to be expected.
Thus, depending on the level of professional end-use that a product has, or the need for an up-to-date image of excellence and performance, it is either signed 3M in a prominent manner or even perhaps exclusively. If not, 3M is present through the brand Scotch. Perhaps this is why the sellotape, Scotch Magic, used the name 3M only as a recall tool.
On the other hand, aerosol glue for communication professionals bears the Scotch name in small print and 3M in large letters. There are also differentiated product advertisements for the ‘Raccoon’, general-use sellotape, Scotch cassettes and Post-it. Beyond the endorsing brand, there are no common codes of expression which appear independent in form and intent.
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