Kill a brand, keep a customer.

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Most brands don't make much money. Year after year, businesses generate 80% to 90% of their profits from less than 20% of their brands. Yet most companies tend to ignore loss-making brands, unaware of the hidden costs they incur. That's because executives believe it's easy to erase a brand; they have only to stop investing in it, they assume, and it will die a natural death. But they're wrong. When companies drop brands clumsily, they antagonize loyal customers: Research shows that seven times out of eight, when firms merge two brands, the market share of the new brand never reaches the combined share of the two original ones. It doesn't have to be that way. Smart companies use a four-step process to kill brands methodically. First, CEOs make the case for rationalization by getting groups of senior executives to conduct joint audits of the brand portfolio. These audits make the need to prune brands apparent throughout the organization. In the next stage, executives need to decide how many brands will be retained, which they do either by setting broad parameters that all brands must meet or by identifying the brands they need in order to cater to all the customer segments in their markets. Third, executives must dispose of the brands they've decided to drop, deciding in each case whether it is appropriate to merge, sell, milk, or just eliminate the brand outright. Finally, it's critical that executives invest the resources they've freed to grow the brands they've retained. Done right, dropping brands will result in a company poised for new growth from the source where it's likely to be found--its profitable brands.

CitationsShowing 10 of 12 papers
  • Open Access Icon
  • Research Article
  • Cite Count Icon 15
  • 10.1016/j.cstp.2018.12.008
Review of Airline-within-Airline strategy: Case studies of the Singapore Airlines Group and Qantas Group
  • Dec 18, 2018
  • Case Studies on Transport Policy
  • Christopher Raynes + 1 more

Review of Airline-within-Airline strategy: Case studies of the Singapore Airlines Group and Qantas Group

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  • Cite Count Icon 5
  • 10.1109/emr.2021.3101112
Product Deletion Decisions for Adjusting Supply Chain Strategy: A Case Study From the Food Industry
  • Sep 1, 2021
  • IEEE Engineering Management Review
  • Seyedehfatemeh Golrizgashti + 2 more

Supply chains are formed around the products they accommodate; timely adjustment of the products portfolio is essential for the supply chain's competitiveness. Product management decisions can be used as an operational strategic tool to adjust supply chain performance and strategy, i.e., through removing burdensome products, rollover, or revitalizing them. Despite the instrumental role of product deletion decisions, limited attention has been directed toward this operations management topic. This article introduces the product deletion score for the periodic and proactive product appraisal for possible revitalization and deletion decisions. For this purpose, a multimethod multicriteria decision-making framework is developed to provide a systematic approach for the strategic assessment of products. Given the depth and width of the product portfolios in the food industry and the complexities involved in their supply chain, a case study from this sector is conducted to inform other industry situations. Exploring the case-specific decision factors pertinent to this sector, we showed that product deletion decisions can be applied as a managerial instrument for adjusting the competitive and operational aspects of the supply chains.

  • Open Access Icon
  • Research Article
  • 10.17265/1537-1514/2013.01.008
The Role of Branding in SMEs: Different Perspective on the Market
  • Jan 28, 2013
  • China-USA Business Review
  • Franc Vidic + 1 more

This paper examines the role of branding among Slovenian small and medium sized enterprises (SMEs) and attitude of entrepreneurs to branding strategy. The term “branding” is usually dominated by big global businesses which operate on world mostly consumer markets and build their competitive strategies on powerful branding. Also in academic research literature and textbook, efficient brands are frequently mentioned, particularly in connection with large global companies. However, also SME nurture their own specific approach to branding development although these processes may not be on a conscious level of thinking. Many SMEs are facing dilemmas connected with investing money, time, and energy to change the established practice, and to undertake a strategic approach to brand management. Based on extensive literature survey and researchers’ own experience, a questionnaire was developed to measure the branding development attitude of SMEs. A random sample of companies with at least five employees with the purpose of eliminate micro businesses for which the issue of branding may not be that relevant enabled a level of significance which allows generalization of results. By using descriptive statistics and cluster analysis, we were able to determine the use and position of brand management within the strategic orientation context of researched companies. An important result of the study is the classification system of SMEs, with regard to their market position and future perspective. The participating companies were categorized into the following four groups (clusters): (1) ignorant, (2) users, (3) low-cost producers, and (4) differentiation producers. The ignorant are predominantly micro businesses serving only local markets with no ambition for any growth. The users are businesses of early growth which may not be entirely aware of the potential of branding which is consistent to their generic strategy which may not be refined yet. The low-cost producers and differentiation producers already utilize branding to backup their chosen core strategic orientation. While the first two groups tend to be more passive, the last two groups pursue more proactive strategic orientation. The main finding of the paper is therefore an empirical confirmation of the theoretical stand that branding should not be a sole-standing business function but merely embedded into the core generic strategy which a company is following.

  • Book Chapter
  • Cite Count Icon 17
  • 10.4337/9781849806046.00016
Branding and Firm Value
  • Feb 12, 2011
  • Shuba Srinivasan + 2 more

Many organizations have found that the value to business operations and financial performance created by the marketing function has become very important. The need to demonstrate this importance has also become clear. Top managers are constantly challenging marketers to document marketing’s contribution to the bottom-line and link marketing investments and assets to metrics that matter to them. This Handbook relates marketing actions to various types of risk and return metrics that are typically used in the domain of finance. It provides current knowledge of this marketing-finance interface in a single, authoritative volume and brings together new cutting-edge research by established marketing scholars on a range of topics in the area.

  • Research Article
  • Cite Count Icon 8
  • 10.2501/jar-55-2-146-161
The Brand in the Boardroom
  • Jun 1, 2015
  • Journal of Advertising Research
  • Joanna Seddon

ABSTRACT Brand valuation began in the 1980s as a financial tool used to separate out the value of brands from goodwill for accounting purposes. It since has become the provenance of firms that create a single point-in-time number for a brand9s value, often using dubious methodology. This study proposes to morph brand valuation into a transparent, accessible tool that can guide and inform every aspect of brand building and provide the financial underpinning for the many decisions that propel business growth. It also should empower marketing leaders to claim their rightful place in the boardroom as managers of the brand asset.

  • Book Chapter
  • Cite Count Icon 3
  • 10.1007/978-3-8349-7134-0_14
Interne Markenführung im Kontext von Mergers & Acquisitions
  • Jan 1, 2012
  • Franz-Rudolf Esch + 1 more

Mergers & Acquisitions (M&A) beherrschen das wirtschaftliche Geschehen im 21. Jahrhundert. Allein im Jahr 2004 wurden weltweit 30.000 Akquisitionen im Wert von 1.900 Mrd. US-$ abgewickelt, was in etwa einer Transaktion alle 18 Minuten entspricht (vgl. Cartwright/Schoenberg 2006, S. 1). Ambitionierte Plane fur fiktive Synergien und finanzielle Ersparnisse durch M&A beflugeln dabei die Fantasie der TopManager, vorrangig am Shareholder Value orientierter Unternehmen. Die Erfolgsbilanz von Unternehmenszusammenschlussen ist dagegen eher ernuchternd. Nur knapp 40 Prozent der Ubernahmen erfullen tatsachlich die Erwartungen oder ubertreffen diese (vgl. Ernst&Young 2006, S. 19). Doch vielfach wird ubersehen, dass die Wertsteigerung bei M&A nicht allein auf Kostensenkungen beruht, sondern einer nachhaltigen Wertschopfung bedingt (vgl. Kruger 2004, S. 59). Aufgrund dieses Tatbestandes kommt insbesondere den wichtigsten immateriellen Wertschopfern, wie Marken und Mitarbeitern, und deren nachhaltige Integration im Rahmen von M&A eine erfolgskritische Rolle zu. Eine optimale Voraussetzung hierfur bieten markenorientierte Unternehmungen, da sie branchenubergreifend hohere Wertschopfungspotenziale erzielen als der Branchendurchschnitt, die Kundenloyalitat wahrend M&A aufrechterhalten und die Mitarbeiter durch die Marke binden konnen.

  • Research Article
  • 10.7318/kjfc/2014.29.6.593
외식기업의 브랜드 다각화가 수익성에 미치는 영향에 관한 연구
  • Dec 30, 2014
  • Journal of The Korean Society of Food Culture
  • Ha-Na Min + 2 more

Brands play a critical role as a core asset and the primary driver for corporate growth because of their power of identity and influence on customers’ perceptions in restaurant industry. However, in spite of diverse and dynamically changing recent brand portfolio strategies of restaurants, a study on the effect of brand diversification on financial performance has been rarely conducted in the restaurant industry context. Considering competing viewpoints regarding diversification’s influence on financial performance, the purpose of this study is, therefore, to examine the effect of brand diversification on firm performance of restaurants. The results indicated that brand diversification is positive effect to profitability. Brand diversification seems to be attractive and might be a reasonable growth strategy to expand market power by satisfying diverse consumer needs. Therefore, restaurant managers should be consider in implementing brand diversification strategy especially in dynamically changing trend of brand diversification in the current restaurant industry.

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  • Research Article
  • Cite Count Icon 2
  • 10.5209/rev_cese.2014.v24.48609
Nuevas dimensiones y problemáticas en el ámbito de la creación y gestión de marcas
  • May 8, 2015
  • Cuadernos de Estudios Empresariales
  • Julio Cerviño + 1 more

This paper analyses the brand as a driver of business competitiveness and sustainable source of competitive advantage. From a holistic perspective, and after addressing the literature about branding, the newest and most current issues regarding brand management are discussed. Specifically, the different functional areas of the company are discussed to deal with the growing problem of «dormant brands», the parameterization of the legal concept of «brand awareness», the brand dilution generated by third parties, the relation between brand equity and international competitiveness, and finally, the issue of valuing brands as well as how the ISO 10668 may drive brand valuation.

  • Research Article
  • Cite Count Icon 32
  • 10.1016/j.jcps.2009.03.004
Consumer responses to brand elimination: An attributional perspective
  • May 6, 2009
  • Journal of Consumer Psychology
  • Huifang Mao + 2 more

Consumer responses to brand elimination: An attributional perspective

  • Research Article
  • 10.1109/icisem.2013.12
Empirical Analysis of the Relationship between Brand Marketing Strategies and Marketing Performance of Agricultural Science and Technology Enterprises
  • Aug 16, 2013
  • Deshui Yu + 2 more

The theoretical relationship model of brand marketing strategies and marketing performance of agricultural science & technology enterprises is constructed and research hypothesis is proposed with theoretical research method. It is proved four brand marketing Strategies combinations of agricultural science & technology enterprises have positive effect on marketing performance by the empirical analysis. That helps enterprises to select suitable brand marketing strategy and enhance strategy application by strategy combinations with different dimensions so as to promote the marketing performance.

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