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MANAGING FOOD & BEVERAGE COMPANIES Small and Big 1

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MANAGING

FOOD & BEVERAGE COMPANIES

Small and

Big

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AGENDA

 

When the Size Makes the Di! erence 

Niche and Mass Markets

 

Customer Touchpoints

 

Storytelling

  Growth Strategies

 

Brand Portfolio and Brand Architecture

 

Growth and Organizational Change

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BIG OR SMALL?

Is it better to be small or big?

There is no right answer. 

It is a decision to be made.

It is a matter of mindset:

Thinking Vs. Acting:THINK BIG, ACT SMALL

Having a complete and broad view of the market and at the samtime having a strong focus on actions to implement

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BIG VERSUS SMALL

Big companies can exploit,thanks to their size, the economiesof scale. They refer to the cost

advantage that arises with theincreased volumes of production.The greater the quantity of goodsproduced is, the lower the !xedcost per-unit is, because thesecosts are shared over a larger

amount of products. This letscompanies o" er their products ata lower price.

Small companies caexploit them because osmall capacity of produ

However, they can o" er expensive products to a market that is willing to sm o n e y f o r d i  " echaracteristics, such as hsophistication. 

ECONOMIES OF SCALE

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BIG VERSUS SMALL

Big companies sense themarket, identifying the emerging

trends earlier. However, at thesame time, they are morebureucratic and this slows thedecision making process andconsequently makes it harder tograb opportunity.

Small companies are structured and this allows

to make decision faster. probably need more timidentify an opportunity, but they are more #exible grait is easier.

FLEXIBILITY

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BIG VERSUS SMALL

Big companies have morebagaining power. This allowsthem to design advantageoustrade relations and to have ane" ective presence in themarket.

BARGAINING POWER

Small companies havreduce their expectat

since the rules are made bcompanies. However, theymore adept and able to cniche markets.

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BIG VERSUS SMALL

Big companies havecheaper prices thanks to

the economies of scale.Somet imes, th is le tsconsumers think that bigcompanies o" er lowerquality products.

IMAGE

Small companies sellhigher priced goods.

This is often associatedwith a higher quality andcompetence.

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BIG VERSUS SMALL

There is no strong unique advantage in being small or big.

The real point is leveraging on one’s own di" erence.

What are company’s PoDs?

If a company is big, it should know how to leverage on its size.

If a company is small, it should leverage on the advantages of a smalle

“There Is No Preference Without a Di  ! erence.”

A company has to give customers thereason to choose it.

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AGENDA

 

When the Size Makes the Di" erence

  Niche and Mass Markets

  Customer Touchpoints

 

Storytelling

 

Growth Strategies

 

Brand Portfolio and Brand Architecture

 

Growth and Organizational Change

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MARKET AND COMPANY SIZ

An important point is the match betweenthe size of the company and the size of the market.

Every market can be segmented .

Every company can segment in a di  ! erent way .Every segment can have di  ! erent size.

What is the approach

that a company wants to have towards the market?

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MARKET SIZE CONTINUUM

NICHE

MARKET

M

MA

The market size is a continuum:

SEGMENT

SPECIALIZATION

MACRO

SEGMENTATION

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MARKET SIZE CONTINUUMNICHE MARKET:

It is a small but speci!c and well de!ned segment of the population.customers have particular and high expectations, therefore the oshould be sophisticated and customized so as to meet them.

MASS MARKET:

A company that approaches the market with a unique value proposiwithout caring about the di" erence between segments. This extremnowadays uncommon.

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MARKET SIZE CONTINUUM

SEGMENT SPECIALIZATION:

A company focused on one single segment.

MACRO SEGMENTATION:A company that divides the market in few big segments. Their valueproposition is di" erent in each segment.

Source:https://gatorgong.!les.wordpress.com/2015/01/mccafe-header.gif, http://logok.org/wp-content/uploads/2014/06/Mcdonalds-logo-old.png , http://popsop.ru/wp-content/uploads/hipp_amore_packaging.jpg

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MARKET SIZE CONTINUUM

Segmenting and o" ering di" erent value propositions can be identi!ed

Companies often exploit their brand portfolio,

allocating each of the brands for a speci!c segment.

A Market-Oriented Approach

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MARKET SIZE CONTINUUM

Danone BRAND PORTFOLIO

e.g.

Source: http://actimel.co.uk/wp-content/uploads/2014/07/Original-fat-free1.png, http://www.foodandwine.hu/wp-content/uploads/2010/07/activia-natur-3dhttp://www.danonescandinavia.com/aineistot/Render_Danonino_Erdbeer.jpg,

 Are these products

directed to thesame

customers?

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 Are these products

directed to thesamecustomers?

MARKET SIZE CONTINUUM

Bacardi BRAND PORTFOLIO

e.g.

Source: http://www.vodkaycaviar.com/120-207-thickbox/comprar-vodka-grey-goose.jpg, http://img1.!ndthebest.com/sites/default/!les/821/media/images/Aberfeldy_12_Year_Old_Single_Malt_Scotch_1182914.jpg

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VALUE PROPOSITION

CONTINUUMParallel to the market size continuum, there is the Value Proposition (

VP) Continuum, which involves standardization and personalization

STANDARDIZATIONOne single proposition for

the entire market.

PERSONALIZATIONFor each segment compa

designs a speci!c value

proposition. As an extremeach customer could have t

own value proposition.Mass Market

Niche Market

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VP CONTINUUM

Restaurant service

Source:http://venturebeat.com/wp-content/uploads/2009/02/ala_carte_menu_1798.jpg, https://barndivarestaurant.!les.wordpress.com/2012/07/prix-!xe-menu4.jpg

ChosenOptions

and

ChoosingOptions

e.g.

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VP CONTINUUM

Hello Fresh

e.g.

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VP CONTINUUM

Pepsi Spire

Pepsi Spire is a revolutionary project because it lets consumers cand mix the #avors they prefer. Before, in the soft drinks industr#avor can only be chosen by selecting the relative brand, such as for lemon, Fanta for orange, and so on.

Pepsi Spire changed this mechanism.

e.g.

Source:http://frozenemotion.com/v3/wp-content/uploads/2014/10/pepsi_cover.jpg

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(DIS)ADVANTAGES

Mass Market and Standardization: High e$ciency, lower cocommercial, production and communication synergies. However, di" erentiating means asking customers who have di" erent expectatto standardize themselves in order to be aligned with your vproposition.

Personalization: High e" ectiveness, but diversifying means modifyingfactors and so increasing the costs.

It is up to the company to decide which part of thecontinuum it would like to be in

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VP CONTINUUM

StandardizationSTARBUCKS

The format is the same everywhere

e.g.

PersonalizationSUBWAY

Create your own sand

Source: http://www.satoshikato.com/+Works/subway/DIY/Subway_DIY.jpg, http://www.solterradev.com/wordpress/wp-content/uploads/starbucks.jpg

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AGENDA

 

When the Size Makes the Di" erence

  Niche and Mass Markets

  Customer Touchpoints

 

Storytelling 

Growth Strategies

 

Brand Portfolio and Brand Architecture

  Growth and Organizational Change

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TOUCHPOINTS

Touchpoints refer to every type of contact that a company can have w

its customers (e.g. a point of sale, a product, etc..).

The value delivery process consists of designing, realizing, and managinsystem of touchpoints between the organization, its products and

brands, and its target customers.

Touchpoints can be classi!ed into:

What is the most e! ective way to reachthe target market?

Owned ;3 Earned ;3 Paid ;3

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OWNED TOUCHPOINTS

Owned touchpoints are self-explanatory, and obviously alloworganization with complete control.

Although there is no pay-for-use fee,  there are design and managecosts to consider.

The most obvious examples here are owned stores, owned sales netwcompany websites, social media accounts, etc.

! They are more a" ordable than the paid ones.Another example is sales force.

Source: http://www.bytez.nl/wp-content/uploads/2014/05/DSC_1136.jpg, http://www.gourmetsleuth.com/images/default-source/dictionary/triscuit-crackers.jpg?sfvrsn=4

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EARNED TOUCHPOINTS

Earned touchpoints are beyond the organization’s control and are f

by third parties (experts and consumers, among others). Here coregarding the organization and its products and/or brands is delibecause it is considered interesting and captivating. Some exampleexpert reviews, word of mouth among consumers, “retweets” and “shon social media, and etc.

! They are not paid but are in#uenced by the company.

! They have a great potential: since they are not directly managed bcompany, consumers perceive them as more credible and reliable.

Source: http://www.mdimsolutions.com/wp-content/uploads/2014/08/socialpic.jpg

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PAID TOUCHPOINTS

Paid (or bought ) touchpoints are touchpoints that the organizationfor a limited period of time.

Examples are ad space on a television channel, a newspaper, or asite (e.g. banners), or independent stores used to distribute products

! They are expensive and not a" ordable for some small companies means that speci!c audiences cannot be reached.

Additional examples of this type of TP are: Sponsorship  and PrPlacement

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PAID TOUCHPOINTS 

Product Placement: The purpose

incorporation of a brand into anentertainment vehicle.

Source: https://esulli6.!les.wordpress.com/2013/05/ted10.jpg

Sponsorship: Involves an agreement betweentwo organizations that gives one (the sponsor) theright to publicly associate its name and its logowith the other (the sponsee) in exchange for some

form of payment, either monetary or in-kind.

UNCONVENTIAL

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UNCONVENTIAL

COMMUNICATION

It is a hot communication means that many small companies use beclets companies reach a big audience in a non-costly way.

Two examples are:

Guerrilla Marketing !   This refers to low-budget, unconventional advactivities (gra$ti, sticker bombing, #ash mobs, micro-events, grassroots ma

and so on). These initiatives are done in a clearly delineated time and place (wwhere ‘guerrilla’ comes from) and have a high impact on the public.

Viral Marketing !  The digital evolution of PR is all about viral marketing , alsoword-of-mouth or buzz marketing . The aim here is to create content that conwill voluntarily share on via social networks (hence the term word-of-

triggering a self-replicating viral process and creating a “buzz.”

UNCONVENTIAL

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UNCONVENTIAL

COMMUNICATIONe.g.

Source: http://cdn.creativeguerrillamarketing.com/wp-content/uploads/HLIC/39927eef9a2a35c2c04815c1cc47a4a2.jpg, https://c2.static#ickr.com/8/7358/9263891670_a415d29f84_b.jpg, https://upload.wikimedia.org/wikipedia/en/5/5a/MC-Lager-4c_.jpg, http://www.candywarehouse.com/assets/item/large/Anthon_Berg_logo_new1.jpg

B F d I i

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“With TRND, companies understand how powerful consumers are.”Ma

Partner & Global Collaborative Marketi

BeFood Interviews:

Designing a Word of Mouth Campaign

INTEGRATED MARKETING

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INTEGRATED MARKETING

COMMUNICATION

An organization can exploit numerous touchpoints to deliver contenmessages regarding its value propositions, but touchpoints are only a

part of a marketing communication.

E" ective communication calls for the careful planning and integratcontent and media, so that the messages that reach the target aud

are homogeneous and productive.

With respect to marketing communication decisions, these fall intomacro-areas:

What content should be

delivered

What touchpoints are

used as delivery vehicles

INTEGRATED MARKETING

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INTEGRATED MARKETING

COMMUNICATION

There are several stages that, together, make the communication p

Identifying target

audience 

Settingcommunicat

ionobjectives 

Designingcontent 

Selectingtouch

points/media 

Releasingthe

campaign 

Mere

Companies have to design

a touchpoint system that is consistent with their size.

Creativity has a big role in communicating company message and balance the lower budget of small companies.

Every company can communicate

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AGENDA

 

When the Size Makes the Di" erence

  Niche and Mass Markets

 

Customer Touchpoints

  Storytelling

 

Growth Strategies

 

Brand Portfolio and Brand Architecture

  Growth and Organizational Change

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STORYTELLING

The content of the message is as important as the medium that is use

communicate to the company’s target market.

Storytelling is di" erent from the classical communication messag

Today most of the markets are so crowded that saying that a compaproduct is better than the competitors’ is not enough.

You must be able to catch customers’ attention and preferenc

Today there is the need of telling a story.

Storytelling is creating a narrative that makes the brand more humanbrings it closer to the target customers.

THE STORY

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THE STORYThe features of a story are:

Relevance: a story is not a story in itself, it should be perceived as reby consumers and it should be di" erent when compared with compones.

Intimacy: a story should be able to create empathy between the targ

the product. Intimacy creates a bond, so it is fundamental for the cusrelationship.

Continuity: a story should last and should be nurtured overtimeshould be renovated overtime to stay alive.

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STORYTELLING

Storytelling is about the message that the brand conveys overtim

e.g.

The valueslisted and

showed in thecommercials

make the brandhuman.

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BRANDLOVE

The story makes a brand more human and this lets consumers fe

emotions towards brands that are similar to ones felt towards hum

“Brand love” is the ambition that brands should have when they tell a

A brand love is a brand present in consumers’ everyday life.

Typical consequences of brand love are:

intention to pay premium price brand loyalty positive word-of-

“Brand love is an emotional and passionate relationship present

between a satis " ed consumer and a brand”  " Carroll and Ahuvia (20

AG A

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AGENDA

 

When the Size Makes the Di" erence

  Niche and Mass Markets

 

Customer Touchpoints

 

Storytelling

  Growth Strategies

 

Brand Portfolio and Brand Architecture

  Growth and Organizational Change

THE GROWTH PATH

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THE GROWTH PATH

All companies at birth are small.It can take months, years, or centuries to grow.

How is it possible to identify and catch the opportunities in order grow?

How do you design a growth path?

BeFood Interviews:

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Start small, get bigger

“Our growth went through three main stages: the learning period, thegrowth in Italy, and the agricultural and international age.”

Fed

BeFood Interviews:

GROWTH STRATEGIES

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GROWTH STRATEGIES

A market can be compared to a pie and

the company position is one slice of that pie.

Market share

New market

Marketpotential gap

Potentialmarket

Currentmarket

GROWTH STRATEGIES

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GROWTH STRATEGIES

There are three di" 

erent strategic options:

1. Growing within the current market

2. Activating a potential market

3. Creating a new market

GROWTH STRATEGIES

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GROWTH STRATEGIES

Increasing one’s own slice, taking away competitors’ portion. To do tcompany has to o" er a unique value proposition.

Thinking out of the current market. A company has to think abou

market in terms of volume:

To increase the volume, companies can leverage on one of these tfactors. Some examples of strategies are: converting non-pro

category- customers (that feel the desire) into customers, innovatinoccasion of usage, increasing the quantity bought.

Customers x occasions of usage x quantity per time

1. GROWING WITHIN THE CURRENT MARKET

2. ACTIVATING A POTENTIAL MARKET

GROWTH STRATEGIES

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GROWTH STRATEGIES

Converting non-customers into customers: There are people that dfeel the need or the desire of having a given product. This is often thewhen they think that there is not a valuable value proposition thasatisfy their expectations.

A company has to decide among these three optionsor opt for a combination of the three.

3. CREATING A NEW MARKET

GROWTH STRATEGIES

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GROWTH STRATEGIES

They are really di" erent in terms of risks:

Potential market:change the habits,p e r c e p t i o n s ,c a t e g o r i z a t i o ns y s t e m s o fcustomers.It needs a higher levelof innovation.

N e w m a r ktransform peopcustomers.I n n o v a t i orequired at thelevel but also acustomer level.I t is the risoption.

Current market: acompany knows itstarget market and itscompetences.Risks are !nancialand of innovation.

AGENDA

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AGENDA

 

When the Size Makes the Di" erence

 

Niche and Mass Markets

 

Customer Touchpoints

 

Storytelling

 

Growth Strategies

  Brand Portfolio and Brand Architecture

  Growth and Organizational Change

BRANDS

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BRANDSUsually at birth the company and brand have the same name.

This is the so-called “Parent” or “Master” brand, that is the brand identi!es all the products of a company.

When companies grow, one single brand can be not enough. Indeedbrand evokes speci"c associations that are known by the speci"

target segment. Since di" erent segments have di" erent expectatio

having di" erent brands let companies to match the each one desir

BRAND PORTFOLIO is a combination of brands that the company sinto a market.

How do you manage several brands ina unique brand portfolio?

BRAND ARCHITECTURE

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BRAND ARCHITECTURE

Brand architecture is a model that helps de!ning:

the ROLE of each individual brand within the portfolio

the RELATION among brands

! the RELATIONSHIP between the brand and the customer segme

BRAND ROLES

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BRAND ROLESBrands can have di" erent roles:

- STRATEGIC: Brands that ensure the future of the company, these braare typically growing and appreciated by the customers.

- IMAGE: Brands with such a high quality and image, that they are ablespread them over the entire portfolio.

- ENTRY LEVEL: their objectives is to cover the bottom part of the marand satisfy that group of consumers that is not sensitive in terms of vapropositions and search for low price products.

- FLANKER: their main objective is to take away market space fromcompetitors.

BRAND ROLES

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BRAND ROLES

The performance measures are associated with roles and are spec

for each type of brand:

#$%&' $()*+ !  ,*$-($.%&/* .*%+0$*.*&1+

<;=>;:?!, ?%$8&0@ <'-+4@ A'%/+& <0'%+

!A>?: !"'1+

:B;=C D:E:D <'-+4 .( &+%"4 $F E$-9"+4

GD>BH:= A'%/+& <0'%+

BRAND RELATIONS

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BRAND RELATIONS

Companies should be able to di" erentiate their brands in order to av

internal  cannibalization.

The brand relations can be de!ned through branding strategies:

House of BrandStrategy

EndorsementStrategy

Sub-BrandStrategy

Branded HouseStrategy

BRAND RELATIONS

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BRAND RELATIONS

House of Brands

Here the organization owns several brands and manages eachseparately, without making their shared origins public.The point of this strategy is to maximize e" ectiveness by attempting to bpositioning for each brand in every single market segment, sacre$ciency.Each brand has its own brand elements, communication strategy, manateam, and other speci!c costs.

BRAND RELATIONSe.g.

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BRAND RELATIONS

House of Brands

Source: https://upload.wikimedia.org/wikipedia/en/f/f9/Twix-Wrapper-Small.jpg, http://img.21food.com/20110609/product/1305767013015.jpg, https://dogindeed.com/media/catalog/product/p/e/ped1_1.jpg

e.g.

BRAND RELATIONS

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BRAND RELATIONSBranded House Strategy

With this strategy, a master brand is used for all the organization’s prand each one is distinguished only by its name.

The aim of the Branded House strategy is to maximize e$ciency, excommunicative synergies generated by communication based on abrand that have positive repercussions For all of its products.

Speci!

cally, this strategy makes it possible to utilize the same elements for all the products, reinforcing awareness and facmemorization. The organization can also keep tight control over imageimage revolves around the master brand.

However, e#ciency here goes to the detriment of e! ectiveness: if thmarket segments that di" er widely in expectations, the closer the b

connected to a single segment and the less appropriate the other sewill consider it.

BRAND RELATIONSe.g.

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BRAND RELATIONSg

Source:https://pbs.twimg.com/pro!le_images/1308982125/logo1.jpg, https://upload.wikimedia.org/wikipedia/en/thumb/4/42/CostaLogo.svg/1024px-CostaLogo.svg.png, https://upload.wikimedia.org/wikipedia/en/thumb/d/d3/Starbucks_Corporation_Logo_2011.svg/1017px-Starbucks_Corporation_Logo_2011.svg.png

Branded House Strategy

BRAND RELATIONS

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BRAND RELATIONS

Sub-Brand Strategy

The main focus on the  parent  brand. Here a master brand is used sub-brand (which occupies a less prevalent position). By implementistrategy the organization seeks to build a strong image for the pbrand that can be transferred to each sub-brand, every onspeci!cities that render its image more attractive for its target segmen

The sub-brand strategy is e! ective  when the di" erences besegments are not so dramatic as to call for ad hoc brand positioning,the same time not so negligible as to be covered with a single brand.

The association between the parent brand and the sub-brands conveyed by the structure of brand elements that encompasses c

di" 

erences for each sub-brand.

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BRAND RELATIONS

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BRAND RELATIONS

Endorsement strategy

Main focus is on the individual  brand.

Here too the master brand is used with another brand, but the actually predominates over the former. This means that the master serves as an endorser, presenter, and certi!er of quality of the sebrand.

The organization’s e" 

orts center on building a strong image foendorsed brand, with positive associations also linked to the mbrand.

So an endorsement strategy is e" ective when the organization wanserve segments that necessitate ad hoc brand positioning, where a brand or a sub-brand is not e" ective enough.

BRAND RELATIONSe.g.

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BRAND RELATIONS

Endorsement strategy

Source: http://www.h3dwallpapers.com/wp-content/uploads/2014/08/Nestle_logo.jpg, https://upload.wikimedia.org/wikipedia/commons/4/48/Nespresso.p

BeFood Interviews:

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Managing Huge Brand Portfolios

“Bulding a winning portfolio means positioning our brands accordinglyconsumers needs and occasions of usage.”

FlorMarketing D

BRAND RELATIONS

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BRAND RELATIONS

The two in-between strategies are the most used in the F&B industry s

they let companies combine the advantages of the two extremes.

Having two levels of brands – Master and individual – allows a companbe able to communicate, at the same time:

the speci"city of the value proposition (individual)-  the strenght that there is behind (master)

It is a matter of FOCUS:

what brands does the company want to highlight?

AGENDA

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AGENDA

  When the Size Makes the Di" erence

  Niche and Mass Markets

  Customer Touchpoints

 

Storytelling

  Growth Strategies

  Brand Portfolio and Brand Architecture

 

Growth and Organizational Change

GROWTH

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G O

The growth of a company involves positive aspects such as the growth

sales and of the market share and the advantage on competitors.

However, the growth of the company requires organizational chang

Growth has an impact on three levels:

Culture Structure Processes

CULTURE

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Organizational culture: a set of shared beliefs and actions typicall

shared among the members of the organization.

Culture can be very di" erent between small companies, where everythis informal, and big companies, whose members almost do not know e

other.

Very often small companies tend to be focused on the product.

When they grow, they become market oriented.

STRUCTURE

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Structure: how roles are de!ned within the organization

and what are the responsabilities.

In small companies, almost everyone can do everything and positionseasier to switch; the roles allocation is not strict.

In big companies, roles should be well de!ned in order to not losee$ciency.

Fundamental for big companies and company whose objective is becobig, is having a well de!ned structure with clearly de!ned roles that

support all the company actions and strategies.

PROCESSES

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Processes: the procedures that regulate the activities that a compan

implements in a market such as communication processes, trainingprocesses ,salary-compensation processes, career de!nition process

In growing companies these procedures are fundamental to indicate hthe tasks should be completed and to ensure that competence mee

performance.

The growth within the market should be parallel to a growth within tcompany.

LINK  

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Bacardi 

HelloFresh 

PepsiSpire 

Anthon Berg 

Molson Canadian 

Guinness 

Guinness II 

NatGeo MegaFactories - Heineken 

Trnd 

Heineken 

Grom 

Triscuit 

Pinterest board 

ADDITIONAL LINKS ON

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GROWTH STRATEGIES

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UNCONVENTIAL COMMUNICATIO

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UNCONVENTIAL COMMUNICATIO