conceptual analysis of brand architecture and ...€¦ · template for its brand architecture....

Brand architecture also reflects thecharacteristics of the product market.Where products are strongly culturallyembedded, local or national brands arelikely to proliferate, catering for speci-fic local preferences. On the otherhand, where customer preferences anddesired product attributes are relativelyhomogeneous worldwide, and productsshare common functions, there aregreater opportunities for global orinternational brands at the corporate orproduct divisional level.

The brand architecture helps in therevival, rentention or merger of brandsthat have low market impact and tendto cause organisational conflicts withthe strong brands of the company. Thisprocess of brand building categorically

Brand architecture may be defined asan integrated process of brand buildingthrough establishing brand relationshipsamong branding options in the com-petitive environment. The brand arch-itecture of an organisation at any timeis, in large measure, a legacy of pastmanagement decisions as well as thecompetitive realities it faces in themarketplace. The firm’s history creates‘brand baggage’. This includes strongbrands with rich traditions (like LouisVuitton) as well as the burden of weakbrands with strong traditions (Sam-sonite). Management inertia and vestedinterests within the firm often createbarriers to the pruning of weak brandsor their absorption into strong brandcategories.

� HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL. 11, NO. 3, 233–247 FEBRUARY 2004 233

RajagopalDepartment of Marketing,Business Division,Monterrey Tec University,ITESM, 222, Calle del Puente,Tlalpan, Mexico City 14380 DF,Mexico

E-mail: [email protected]

Conceptual analysis of brandarchitecture and relationshipswithin product categoriesReceived (in revised form): 4th September, 2003

RAJAGOPALholds a doctoral degree in marketing and is Professor of Marketing at Monterrey Tec University (ITESM) inMexico City. He has been associated with various national institutes including the Administrative Staff College ofIndia in senior academic positions and the University of Birmingham, where he conducted research and trainingactivities. His areas of interest include consumer behaviour, brand management and competitor analysis.

ROMULO SANCHEZobtained a PhD in marketing with economics from LUMS (Lancaster University Management School) in 1998. In1999 he joined the Department of Marketing at ITESM-Campus Ciudad de Mexico. He has also worked for IESAand Universidad Valle del Momboy in Venezuela. His areas of expertise include marketing strategy, brandportfolio management and business to business marketing.

AbstractBrands play a significant role in developing marketing strategies for specific product categories in afirm. A coherent international brand architecture is a key component of a firm’s overall marketingstrategy as it provides a structure to leverage strong brands into other markets, assimilate acquiredbrands, and rationalise the firm’s branding strategy. This paper discusses how firms can developbrand architecture, and considers the factors that contribute in shaping the architecture. Themanagerial implications for marketing management and the impact of architecture on the brandhierarchy are also analysed.

product market structure andmarket dynamics.

— To analyse the importance ofdesigning a clear and effective brandarchitecture and managing brands inorder to maintain a harmoniousbalance within this architecture.

— To emphasise the need for an an-nual audit of the firm’s brand arch-itecture and its fit with changes inthe underlying drivers, as well as anassessment of key strategic brandswithin this architecture.

REVIEW OF THE RESEARCHThere are not many studies conductedin the area of brand architecture,which is a recent offshoot of thebrand concept. A study conductedby Laforet and Saundess2 revealedthree major patterns of brand arch-itecture: corporate-dominant, product-dominant and hybrid or mixedstructures.

Within corporate-dominant brandarchitectures, brands have been largelybuilt on the basis of organisationalstanding in the market, irrespective ofthe product-mix strategies and relatedvariables that have significant impacton the brand performance in thecompetitive environment.3

Within a product-dominant arch-itecture, branding is done accordingto the AATAR model C attributes,awareness, trial, availability and repeatmodel, and technology.

The hybrid pattern of brand arch-itecture considers the organisationalimage as well as the product patternfactors to determine the brand-buildingstrategy. Such a pattern is followed bythe well-established corporate houseswith a strong brand community such asProcter & Gamble (P&G), Unilever,

determines the performance of thebrand and allows the brand manager tochoose the specific strategy position forthe brand in the market.1 The brandarchitecture can be used to rejuvenateweak or dormant brands and tolaunch new brands. The architecture ofbrands, however, also encompasses themanagement aspects of the launchedbrands in the market.

Brand architecture inevitably reflectsprevious management directives. Inthe first place, the firm’s administra-tive heritage and, in particular, itsorganisational structure, establish thetemplate for its brand architecture.Secondly, the firm’s international ex-pansion strategy and notably the modeof expansion — through mergers, ac-quisitions or natural growth — interms of its market share and howbrand structure evolves over time, arethe principal areas addressed by thebrand architecture process. Entry intostrategic alliances in order to broadenthe geographic scope of the firm’soperations will result in a need tobuild the branding strategies of thepartners. The importance of corporateidentity and the diversity of the firm’sproduct lines and product divisionswill also impact the range and numberof brands.

This paper discusses the conceptualissues of brand architecture and theimpact of brand architecture on thepositioning of the brand in competitivemarkets. The paper has the followingobjectives:

— To examine the current perspec-tives on branding and brand arch-itecture.

— To discuss the alternative brandstructures and the underlyingdrivers, ie firm characteristics,

234 � HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL. 11, NO. 3, 233–247 FEBRUARY 2004

RAJAGOPAL AND SANCHEZ

local products. These companies alsovary in the extent to which they havea clearly articulated international brandarchitecture to guide this evolution.Some, for example, specify thedifferent levels at which brands areto be used, the interrelation be-tween brands at different levels, thegeographic scope of each brand and theproduct lines on which a brand is to beused, while others have few or noguidelines concerning internationalbranding.

INTERNATIONAL PERSPECTIVES OFBRAND ARCHITECTUREAnother factor impacting the firm’sbrand architecture is the degree ofproduct market integration. This canbe viewed not only in terms ofwhether the same customers arepresent in the markets of differentcountries or regions and have similarpurchasing needs and interests world-wide, but also whether the samecompetitors are present in thesemarkets.5 Where markets are fullyintegrated and the same competitorscompete in these markets worldwide,as in aerospace, the use of global brandshelps to provide competitive differen-tiation on a global basis. Theintegration of markets and, inparticular, the growth of regional andglobal media also encourages a movetowards international brands in order toobtain cost efficiencies and reinforcebrand strength. Advances in globalcommunication technology and theinternationalisation of retailing furtherfacilitate the growth of internationalbranding and stimulate a shift towardsinternational brands. Retailing hasfurther facilitated and stimulated thedevelopment of manufacturer brands.

Braun (Germany) and Phillips (Hol-land).

There is, however, considerablevariation even within a given typeof structure, depending, to a largeextent, on the firm’s administrativeheritage and international expansionstrategy, as well as the degree ofcommonality among product lines orproduct businesses. In addition, thesestructures are continually evolving inresponse to the changing configurationof markets or as a result of thefirm’s expansion strategy.4 Corporate-dominant architectures tend to be themost common among firms with arelatively limited range of products orproduct divisions, or with a clearlydefined target market, such as Shell,Kellogg’s, Nike, Benetton, and so on.Product-dominant architectures, on theother hand, are typically found amongfirms such as Akzo Nobel with mul-tiple national or local brands, or firmssuch as P&G or Mars that haveexpanded internationally by leveraging‘power’ brands. The most common arehybrid or mixed structures, consistingof a mix of global corporate, regionaland national product-level brands, cor-porate endorsement of product brandsor different structures for differentproduct divisions.

Both corporate- and product-dominant structures are evolvingtowards hybrid structures. Firms withcorporate-dominant structures are ad-ding brands at other levels, forexample, the house or product level, todifferentiate between product divi-sions. Product-dominant structuresmay be described with referenceto the multiple brands that aremoving towards greater integration orco-ordination across the marketsthrough corporate endorsement of


CONCEPTUAL ANALYSIS OF BRAND ARCHITECTURE AND RELATIONSHIPS WITHIN PRODUCT CATEGORIES

municative or rich environments suchas the internet accentuate the driftbetween owner and user brandmeanings, and this increases theimportance of understanding the formsof linkage between brand meanings.

BRAND ARCHITECTUREThe brand architecture is the organis-ing structure of the brand portfolio thatspecifies brand roles and the na-ture of relationships between brands.The conventional strategies of brandarchitecture have been developed toreference to equity charter, leveragesand brand profitability. Contemporarytheories, however, state that brandarchitecture is based on the efficacy ofthe attributes, derived advantages andbrand system emerging in relation tothe buying power of the customer.

The first step in establishing a brandequity management system is to definethe brand equity in a document —the brand charter — which providesrelevant guidelines for the market-ing managers. Such a documentationstrategy requires defining the firm’sview on the significance of the equityconcept, and describing key brands interms of the associated products ornames and the manner by which theyhave been branded and marketed.

The second step in establishingsuccessful brand equity management isto integrate the results of the periodicalbrand track survey. The mapping of themarket information on the criticalindicators of the key brands can also bea guiding tool for the brand arch-itecture and for developing the brandvalue chain.11 While creating the brandstrategy, it is important to understandthat the preliminary definition of thebrand equity is not the same for

As retailers move across internationalborders they provide an effectivechannel for international brands but, atthe same time, their power increases.Consequently, manufacturers need todevelop strong brands with highmarket shares in multiple countries inorder to obtain adequate retail space forthese brands and minimise slottingallowances.6

A final factor underlying the powerof international brands is increasedconsumer mobility. While global mediaprovide passive exposure to brands,increasing international travel andmovement of customers across nationalboundaries provides active exposure tobrands in different countries.7 Aware-ness of the availability of an interna-tional brand and its high visibility inmultiple countries enhances its value toconsumers, and provides reassurance ofits strength and reliability. Increasedexposure to and familiarity with newand diverse products, and the lifestylesand cultures in which they areembedded, also generates greater recep-tivity to products of foreign origin orthose perceived as ‘international’ ratherthan domestic.

The way in which consumersperceive brands is a key deter-minant of long-term business-con-sumer relationships.8 The term ‘brand’has been shown to comprise meaningsdrawn from two distinct sources: firstthe brand identity as codified andcommunicated by the brand originator,and secondly the brand meaningsdrawn from the users or consumerenvironment.9 This division of mean-ing between originator and consumerhas a number of implications, not leastthe potential for ‘drift’ betweenorganisationally determined meaningand user-perceived meaning.10 Com-



endorsed brands. The categories ofbrands play significant roles in theprocess of brand architecture for acompany by:

— creating coherence and effective-ness

— allowing brands to stretch across theproducts and markets

— stimulating the purchase decisionsby brand drivers

— targeting market niches and benefitpositioning.

Sub-brands and endorsed brands canplay a key role in creating a coherentand effective brand architecture. Thesub-brands and endorsed brands al-low brands to stretch across productsand markets, address conflicting brandstrategy needs, conserve brand-build-ing resources in part by leveragingexisting brand equity, protect brandsfrom being diluted by over-stretching,and signal that an offering is new anddifferent.

The brand relationship spectrum, assuggested by Figure 1, is related to thedriver role that brands play. The role ofthe driver reflects the degree to whicha brand drives the purchase decisionand experience of consumers on theusage of the product. A branded houseuses a single master brand to span a setof offerings that operate with onlydescriptive sub-brands. The house-of-brands strategy, in contrast, involvesan independent set of stand-alonebrands, each maximising the impacton a market. The house-of-brandsstrategy, however, clearly positionsbrands on functional benefits and todominate niche segments. Targetingniche markets with functional benefitpositions is the main reason for using ahouse-of-brands strategy.

company-named brands. In cases ofcompany-owned brands, the brandbecomes the principal spokespersonfor the company, and often thatworks as the pivot of the brandarchitecture process in the domesticand internationally segmented markets.Jean-Noel Kapferer12 proposed themodel of hierarchy of brands in 1992with six levels of brands includ-ing product brands, line brands andumbrella brands. This model forms anew development in the managementof brands and was developed withextraordinary insight by Kapferer.13

Later, in 1996, David Aaker con-structed an innovative framework forillustrating brand systems, and charac-terised brand roles as drivers, endorsersand fighter brands, and silver bullets.14

In an attempt to further improve theconcept of brand architecture, the con-cept of brand portfolio strategies hasbeen discussed. It is believed that brandportfolio strategies will help in search-ing for the efficient frontier for thebrand set — the boundary where brandmanagers can maximise their returnsfor any level of portfolio risk. Thebrand portfolio is not restricted to thebrands owned by the company. Thebrand portfolio, on the contrary, in-cludes every brand that affects theconsumers’ decision to buy. Not everybrand the company owns should be inthe portfolio.15 It is necessary to makesuch a distinction in developing thebrand architecture approach for over-coming any conflicts in defining therole and level of brands.

The following discusses a powerfulbrand architecture tool, the brandrelationship spectrum, as shown inFigure 1. It is intended to help brandarchitecture strategists to employ, withinsight and subtlety, sub-brands and



— It represents distinct product andmarket segments.

— Endorsed brands operate independ-ently of the mother brands in themarket.

In the house-of-brands strategy, thebrands are independent. Endorsedbrands are still independent, but theyare also endorsed by another brand,usually an organisational brand. Anendorsement by an established brandprovides credibility and substance tothe offering and usually plays only aminor driver role. The token endorseris one of the variants of the endorserstrategy. In this approach, usually amaster brand is involved in severalproduct-market contexts that aresubstantially less prominent than theendorsed brand. The token endorser

A shadow endorser brand is notconnected visibly to the endorsedbrand, but many consumers knowabout the link. This sub-category inthe house-of-brands strategy providessome of the advantages of having aknown organisation backing the brand,while minimising any association con-tamination. The fact that the brands arenot visibly linked makes a statementabout each brand, even when the linkis discovered. It communicates that theorganisation realises that the shadow-endorsed brand represents a totallydifferent product and market segment.The principal attributes of the endorsedbrand may be delineated as follows:

— It incorporates the shadow brands.— It generates indirect market impact

with mother brands.


Figure 1 Brand architecture map

Brand architecture constituents

Maximisingmarket impact

Avoid incompatibilitiesBreakthrough advantagesPowerful product name

Minimising channel conflict

Positioning onfunctional benefits

Niche market

Independentnot connected

with mother brand

Different product andmarket segment

Parent brand backing

Shadowendorser

House of brands

Strong endorsement tostress total business

support from the mother brand

Reassurance andcredibility from the

mother brand

Nominal and strongendorsements

Stress on attributesLink with mother brandUse value linked name

Associatedname

Brand endorsement

Total brand-product mixintegrates brand performance

incorporating sub-brands

Branded house

Brand relationship

Stretching of mother brandapplication associationBreakthrough new names

Co-drivers

Auxiliary brandsSub-brands category


performing more than an endorser role— for example, customers are buyingand using both Gillette and Mach3;one does not markedly dominate theother. In a branded-house strategy, amaster brand moves from being aprimary driver to a dominant driverrole across multiple offerings. Thesub-brand goes from having a modestdriver role to being a descriptor withlittle or no driver role. Table 1 showsthe brand architecture properties atdifferent levels. The above attributesof the constituents of the brandarchitecture reveal that the optimummarket impact can be obtained withindependent brands. The shadow en-dorsement and strong endorsement ofthe brands have greater impact on thebrand architecture and are determinedby the various attributes of the con-stituents of the brand architecture.

At one end of the spectrum, in-ternational expansion and consumerneeds for reassurance about productquality and reliability result in ashift towards corporate endorsement of

can be indicated by a logo such as theGE light bulb. The role of the tokenendorser is to provide some reassuranceand credibility while still allowing theendorsed brands maximum freedom tocreate their own associations. Anotherendorsement variant is a linked brandname, where a name with commonelements creates a family of brandswith an implicit or implied endor-ser. McDonald’s, for example, hasMcPotato. A linked name provides thebenefits of a separate name withouthaving to establish a second name fromscratch and link it to a master brand.Sub-brands are brands connected to amother brand and augment or modifythe associations of that mother brand.

The mother brand is the primaryframe of reference, which is stretchedby sub-brands that add attribute as-sociations, application associations, asignal of breakthrough newness and abrand personality. When both themother brand and the sub-brand havemajor driver roles, it is considered aco-driver situation. The master brand is


Table I Market impact and brand hierarchy

Independent House of Auxiliary brand, not brands Brand endorsement types brandsconnectedwith mother Shadow Associated

Constituents and attributes brand endorser Nominal Strong name

Maximising market impact High Average Low High High AveragePositioning on functional benefits High High Average High Average HighNiche market High High Average High High HighDifferent product and market segment Average High High High High HighParent brand backing Indirect and Indirect and Indirect and Direct and Direct and Direct and

low high low high high highStrong endorsement from mother brand Absent High Average High High HighResources and credibility from mother brand Indirect High Average High High HighStress on attributes High High High High High HighStretching from mother brand Absent High Low High Average AverageApplication association High High High High High HighBreakthrough names Occasional Occasional Occasional Regular Regular RegularCo-drivers Absent Always Occasional Always Always Occasional


example, has launched an ice-creamline as well as a soft drink under theMars brand name. Cadbury’s Milk Traybrand has been extended to desserts,leveraging the brand’s association withcreaminess. Strong international brandsoften have high visibility and are primecandidates for brand extensions, espe-cially for entry into new and emergingmarkets such as Eastern Europe orChina. In some cases, a well-knownbrand name is used on a product linewhich is marketed under another brandname elsewhere. For example, Danoneuses the Danone name to marketbiscuits in Eastern Europe, in order toleverage customer familiarity with thename. Similarly, Nestle’s Maggi brand,used on sauces and seasonings, hadhigh recognition in Eastern Europe andso was extended to frozen foods ratherthan the Findus brand used elsewherein Europe.

The growing prevalence of cor-porate endorsement and brand exten-sions, coupled with a focus on buildinga limited number of strong brands ininternational markets, has led firms todevelop procedures to manage andmonitor key strategic brands. A keyobjective is to maintain their identityand value in international markets.Two important aspects need to beconsidered:

1. The consistency of brand position-ing in different countries and acrossproduct lines.

2. The value and/or risks of brandextensions in international markets.Widely different approaches havebeen adopted for managing strategicbrands in international markets andassigning custody for them. Typi-cally these vary depending on theorganisational structure of the firm

product brands. This helps to forge aglobal corporate identity for the firmand gathers its products under a globalumbrella, thus generating potential costsavings through promotion of theglobal corporate brand rather thanmultiple independent product brands.At the same time, endorsement by thecorporate brand provides reassurancefor the customer of a reliable corporateimage and enhances visibility. Theadvantages of the corporate endorse-ment of the product brands include:

— building umbrella brands— establishing global corporate iden-

tity— developing customer confidence— monitoring key strategic brands— enhancing the brand value in the

new segments.

Corporate endorsement of product-level brands is increasingly used as amechanism to integrate the brandstructure across country markets,providing a unifying element acrossproduct offerings. For example, Cad-bury uses the Cadbury name on all itsconfectionery products, in conjunctionwith product brands such as DairyMilk, Whisper and so on. Equally, ahouse brand is sometimes used on aproduct worldwide. For example, AkzoNobel places the Sikkens name on allits paint products. At the other end ofthe spectrum, rising media costs,coupled with the importance ofbuilding high visibility and the need toobtain cost economies, create pressuresto extend strong brands across productlines and country borders. Increasingly,new products and variants are launchedunder existing brand names to takeadvantage of the brand names’ strengthand consumer awareness. Mars, for



considered desirable that the corepositioning should be maintained, al-though execution may vary. Theextent to which some deviation ispermitted typically varies considerablyfrom company to company, and fromone product business to another. Thebrand custodian is also often respon-sible for authorising or providing anopinion on brand extensions. Animportant issue with brand extensionsis to avoid over-extension or stretchingof the brand and dilution of its equityand image. Criteria for sanctioningbrand extensions vary considerablydepending largely on the firm’s or-ganisational structure, the diversityof its product lines and businesses,and management philosophy. Often, aproposed extension has to be consistentwith the core brand’s positioning andreinforce or sustain the existing brandconcept. For example, extension of aconfectionery brand to ice cream ordessert should emphasise the same coreattributes. In many cases, proposedextensions of strategic brands are alsorequired to have market potential.Procedures for resolving conflicts inrelation to brand extensions also varyconsiderably depending on custody-management principles and the firm’sorganisational structure.

BRAND RELATIONSHIPThe authors’ proposition is that a four-quadrant matrix is the simplest way ofillustrating the types of relationshipinvolved, and the linkage between thebrands, which is either strong or weak.The factor defining the linkage be-tween the brands is the nature of thebusiness relationship — whether it isclose or distant. The close brands arethose owned by the company and

and the desired degree of control,and range from having no ex-plicit custody strategy to highlycentralised tight control by cor-porate headquarters.

The firms with strong country manage-ment also operate in the productmarkets where brands are not importantand purchase signals may have noexplicit custody strategy. Attention islargely centred around trademark issuesand prority is given to their infringe-ment in different markets. In caseswhere product markets are becomingmore integrated and the aim is toimprove brand harmonisation acrosscountries, specific brand positioningmay be negotiated between corporateheadquarters and country managers.This approach may, however, besomewhat cumbersome where there aremultiple brands to manage. An ap-proach that appears to be becomingincreasingly popular is to appoint abrand champion. The brand championis typically given responsibility forbuilding and managing the brandworldwide. This includes monitoringthe consistency of the brand positioningin international markets, as well asauthorising use of the brand on otherproducts or other product businesses.The brand champion can either be asenior manager at corporate head-quarters, a country manager or productdevelopment group. For example, alead country or one with major marketshare for the brand can be givenresponsibility for the brand.

In examining consistency in brandpositioning in the competitive marketenvironment, there is often recognitionthat some adjustment to local marketconditions will be needed, especiallyfor mature brands. Typically, it is



market. Transaction I is characterisedby strong brand linkage and closebusiness relationships. In this casestrong formal control is exerted, oftenthrough ownership. Interaction is oftensupervisory in nature. The supervisoryand advisory form of relationship (II) ischaracterised by strong brand linkageand distant business relationships. Herecontrol is informal and weaker thanwhen the business relationship is close.Interaction is often advisory, forexample, a manufacturer’s provision ofa merchandising service to a retailer.The interactive and cooperative brandenvironment (quadrant III of thematrix) may be explained in terms ofweak brand linkage and close businessrelationships. In this category thecontrol is strong — either formal orinformal — but the linkage betweenthe brands is weak. Interactionbetween the businesses is cooperative,for example, joint management semi-nars and information sharing. A weak

the distant brands are either shadow-endorsed or independent brands thatare not connected with the motherbrands.

Brand linkage is defined as thelinkage made by customers betweenthe brands involved. The consumers’attitudes towards brands contributesignificantly to the brand relationshipof the products and services of thehouse of brands. The relationship ofbrands may be assessed within thecompany or with the co-brands. Figure2 shows the pattern of brand relation-ships in the business and competitiveenvironment. The brand linkage maybe understood as brand scale inreference to the performance of thebrands of the own company or theco-brands of any alliance.

The brand interaction may bedefined as the preferences andattributes of the brands across thecategories that exist in the company orthose that are easily available in the


Figure 2 Business relationship matrix

Brand interaction

High

Low

Close/own brands Distant/endorsed brands

Marketshare

Transaction

I

Supervisory

advisory

II

Interactionco-operative

III

Marketinteraction

IV


because people prefer them to ordi-nary products. In addition to thepsychological factors already men-tioned, brands give consumers themeans whereby they can make choicesand judgments. Based on these ex-periences, customers can rely onchosen brands to guarantee standardsof quality and service, which reducesthe risk of failure in purchasing.Today’s world is characterised by morecomplex technology, and this can beextremely confusing to the peoplewho are not technology minded.Brands can play an important role hereby providing simplicity and reas-surance to the uninitiated, offering aquick, clear guide to a variety ofcompetitive products and helpingconsumers reach better and quickerdecisions.

BRAND ARCHITECTURE — THEPRODUCT LIFE CYCLE APPROACHThe branding strategy is also developedin accordance with the life cycle of theproducts and services. Many largecompanies consider different brandingstrategies at different levels of theproduct life cycle — introduction,growth, maturity and decline. Thecompanies develop the brand in theintroductory stage with the objectiveof establishing the market position onthe basis of quality, price, applicationand consumer preference. It is neces-sary to invest more in promotion of thebrand at this stage to build awarenessand create the pull effect with thedistribution channels and consumers.Effective brand building is necessary tointroduce the product in the distribu-tion network at the skimming price.

Figure 3 shows the product life cycleapproach to brand management, which

brand linkage and distant businessrelationships are shown in quadrant IVof the matrix. In this case the controland interaction are according to marketconditions. Such interaction tends tobe transactional, for example, sales callsby employees of one business toanother, and alliances.

Brands influence consumers’ deci-sions to buy in any of the ways shownin Figure 2, or through combinations ofthem, sometimes with tremendous per-suasive appeal. The Marlboro brandpersonality is a good example of howa company understands and combinesthe physical and emotional elementsthat appeal to certain customers wholive or would love to live a certainlifestyle. Products such as gold creditcards, watches or prestige items helppeople to express themselves to othersby demonstrating that they are differentand have achieved something. They actas extensions of the personality, so itreally is ‘all in the mind’, and the key tobrand management and development isa clear understanding of what benefitsthe customer is looking for. Ask con-sumers what comes to mind when theyhear the name of a big brand such asBMW or Gucci and they will replywith a list of attributes that go farbeyond the physical, tangible aspectsof product and delivery. If there isone word that brings all these thingstogether in people’s minds, however,it is value. Time and again, researchshows that the real driving force behindmarket leadership is perceived value —not price or inherent product attributes.So long as the customers perceive thatthe brand offers superior value, goodmarket performance will follow, whichcontributes to brand behaviour throughits features and consistency of buying.

Branded products are also successful



and price need to be developed accord-ingly by adjusting the product features,improving communication, providingcomprehensive distribution and offer-ing good price deals to the channels. Atthe stage of decline, the brand needs tobe redesigned with a view to preparingthe product for re-entering the market.The value added features of the productneed to be improved and the productmay need to be relaunched. Simul-taneously, consumer awareness needs tobe generated. The distributors of theproduct may need to be reorientatedtowards the competitive advantages. Atthe same time, efforts have to be madeto clear the stocks of the old productwell before the redesigned version ofthe product is formally launched in themarket.

considers the factors of the marketingmix. In the second stage of the productlife cycle, which emphasises growth ofthe product in the given market en-vironment, the brand needs to bereinforced with a focus on expandingthe consumer segment. In the process,the weaknesses of the product from thepoint of view of the preferences ofconsumers and distributors need to beidentified. Accordingly the strategies tobe built to provide comprehensiveinformation on products and serv-ices strengthen the channel relation-ship and competitive pricing. Duringthe maturity stage of the product,repositioning of the brand is needed,with the objective of securing newmarket segments. The marketing mixstrategies for product, promotion, place


Figure 3 Brand management: The product life cycle approach

Strategy

options

Brand

development

Brand

reinforcement

Brand

reposition

Brand

redesigning

Objectives

Establish

market

position

Expand target

market

Secure new

market

segments

Prepare for

re-entry

ProductAssure high

qualityIdentfy weakness

Adjust

features

Modify weak

features

PromotionBuild brand

awareness

Provide

information

Communicate

new features

Educate on

re-entry features

Distribution

Build

distribution

network

Strengthen

channel

relationship

Deliver all

versions

Smoothen re-entry

problems

PricingSkimming or

penetration

Challenge

competition

Use good

price deals

Reduce price to

clear stocks

Product lifecycle

Introduction Growth Maturity Decline

Product life cycle approach

Brand strategies

Life cycle

Marketingmix


the underlying market dynamics. Ifthe underlying market dynamicsor product market structure havechanged, then the brand’s position inthe overall architecture needs to bemodified accordingly. With thesepreliminaries conducted, the auditshould culminate in a face-to-facemeeting of key participants, includingthe brand custodian, to establishguidelines for the coming year.

The strategic audit begins in thesecond phase as a top-down auditconducted on multiple levels. First,logical groupings of strategic brandsneed to be assessed in terms of theircompliance with established guidelines.Once this has been accomplished,senior management needs to evaluatethe overall structure of the interna-tional brand architecture to determinethe fit with established guidelinesat different levels across multiplecountries. Again, a key factor here ishow the underlying drivers of brandarchitecture have changed. In additionto market dynamics and the productmarket structure, an important con-sideration is how the firm itself hasevolved, particularly with respect toacquisitions or market expansioninitiatives. If the end result of thestrategic audit is that the firm’s brandarchitecture no longer fits underlyingdrivers, steps should be taken to revisethe firm’s architecture so that it reflectsthe new realities of the marketplace.

MANAGERIAL IMPLICATIONSThe product markets continue tochange rapidly.16 As markets evolve,firms need to consider how to modifytheir brand architecture and look foropportunities to reduce the number ofbrands and improve efficiency, as well

BRAND ARCHITECTURE AUDITBrand architecture is not a staticframework, but one that needs tobe monitored and modified con-tinually. The mechanisms establishedfor brand custody help to ensure thatan individual brand is managed ina consistent fashion across multiplecountries. Given the dynamic nature ofinternational markets, however, and thechanging competitive realities, thestructure must be reviewed, at leastannually. A brand architecture auditshould be performed to ensure com-pliance with established procedures andto determine whether the structure ofthe architecture should be changed.This needs to take place on two levels.First, the degree to which individualstrategic brands have adhered toestablished guidelines needs to beassessed. Secondly, the entire portfolioof brands has to be examined in termsof whether the overall brand arch-itecture requires modification.

The compliance audit may be definedas a bottom-up audit of the individualbrands that allows an assessment ofhow well each functions as part of theoverall brand architecture of the firm.The key steps of this phase are:

1. Collection of information that es-tablishes how the brand has beenused in each country where it ismarketed.

2. Assessment of deviations from itsestablished position in the structureand reasons for these.

3. Evaluation of the brand’s perfor-mance.

Deviations are particularly diagnostic.They may suggest poor management ofthe brand globally or, more im-portantly, fundamental changes in



The value of corporate brand en-dorsement across different products andproduct lines, and at lower levels of thebrand hierarchy, also needs to be as-sessed. Use of corporate brand endorse-ment, either as a name identifier orlogo, identifies the product with thecompany, and provides reassurance forthe customer. In international markets,corporate brand endorsement acts asan integrating force, unifying differentbrand identities across national bound-aries. At the same time, corporate en-dorsement of a highly diverse range ofproduct lines can result in dilution ofimage. Equally, negative effects or as-sociations can harm and have long-lasting effects across multiple productlines. Thus both aspects need to beweighed in determining the role ofcorporate brand endorsement in brandarchitecture.

In the view of the authors, a strongand associated name of the brandendorsement would be helpful inpenetrating the new and extendedproduct brands in the market. Thepresence of co-drivers would alsoprovide an added impact on theendorsed brands where competition isintense. Independent brands may beable to make a high impact in nichemarkets by stressing the brand’s at-tributes and advantages compared withclosely competing brands. The con-ceptual synthesis of work on thedynamics of brand relationships, withreference to new business environ-ments, proposes a taxonomy for abetter understanding of the relation-ships and linkages between brands. Theinternet has also been considered as aneffective medium for building brandrelationships. It will be of criticalimportance for future researchers andpractitioners to understand the increas-

as to harmonise brand strategy acrossproduct lines and country markets. Afocus on a limited number of strategicbrands in international markets enablesthe firm to consolidate and strengthenits position and enhance brand power.Effective management of internationalbrand architecture in the light ofchanging market conditions and thefirm’s market expansion is, however,crucial to maintaining its position andstrengthening key strategic brands ininternational markets.

The brand architecture should in-corporate all the firm’s existing brands,whether developed internally or ac-quired. It should provide a frameworkfor consolidation in order to reduce thenumber of brands and strengthen therole of individual brands. Brands thatare acquired need to be merged intothe existing structure, especially wherethese brands occupy similar marketpositions to those of existing brands.Equally, when the same or similarproducts are sold under different brandnames or have different positioning ineach market, ways to harmonise theseshould be examined. Another impor-tant element of brand architecture is itsconsistency relative to the number anddiversity of products and product lineswithin the company. The extent towhich brand names serve to differen-tiate product lines needs to be deter-mined, or alternatively, a commonidentity needs to be established acrossdifferent products. Establishment ofstrong and distinctive brand images fordifferent product lines helps to establishtheir separate identities and diversifythe risk of negative associations (forexample, between food and chemicals).Conversely, use of a common brandname consolidates efforts and canproduce synergies.



Marketing, Vol. 4, pp. 93–110.(6) Barwise, P. and Robertson, T. (1992)

‘Brand portfolios’, European ManagementJournal, Vol. 10, No. 3, September,pp. 277–285.

(7) Alden, D., Steenkamp, J.-B. E. M. andBatra, R. (1999) ‘Brand positioning throughadvertising in Asia, North America andEurope: The role of global consumerculture’, Journal of Marketing, Vol. 63,pp. 75–87.

(8) Fournier, S. (1998) ‘Consumers and theirbrands: Developing relationship theory inconsumer research’, Journal of ConsumerResearch, Vol. 24, pp. 343–373.

(9) Jevons, C. and Gabbott, M. (2000) ‘Trust,brand equity and brand reality in internetbusiness relationships: An interdisciplinaryapproach’, Journal of Marketing Management,Vol. 16, No. 6, pp. 619–634.

(10) de Chernatony, L. and dall’Olmo Riley, F.(1997) ‘Brand consultants’ perspectives onthe concept of ‘‘the brand’’ ’, Marketing andResearch Today, Vol. 25, pp. 45–52.

(11) Keller, K. L. (2003) ‘Strategic BrandManagement — Building, Measuring andManaging Brand Equity’, Prentice Hall, NJ,pp. 409–411.

(12) Kapferer, J.-N. (2000) ‘Strategic BrandManagement’, 2nd edn, Kogan Press,London, UK, pp. 125–140.

(13) Ibid.(14) Aaker, D. (1996) ‘Building Strong Brands’,

The Free Press, New York, NY.(15) Hill, S. and Lederer, C. (2001) ‘The Infinite

Asset — Managing Brands to Build NewValue’, Harvard Business School Press,Boston, MA, pp. 6–9.

(16) Craig, C. S. and Douglas, S. P. (1996)‘Responding to the challenges of globalmarkets: Change, complexity, competitionand conscience’, Columbia Journal of WorldBusiness, Vol. 31, pp. 6–18.

ingly complex variety of factors under-lying and influencing the linkagesbetween brands. Future work will needto concentrate on the operationalimplications of the taxonomy proposedhere. Research could be carried out toassess brand personality using the brandrating method to obtain quantitativemeasures.

In the future, manufacturing com-panies may have to exercise severaloptions over brand sponsorship. Theirproduct may be launched in the marketas the brand of the manufacturer whichis also known as a national brand, adistributor brand (as happens in thecase of edible oils, sugar, processedgrains and many products which needrepacking), or a licensed brand name.

References(1) Aaker, D. and Keller, K. (1990) ‘Consumer

evaluations of brand extensions’, Journal ofMarketing, Vol. 54, No. 1, pp. 27–33.

(2) Laforet, S. and Saunders, J. (1994)‘Managing brand portfolios: How theleaders do it’, Journal of Advertising Research,September/October, pp. 64–76.

(3) Ibid.(4) Sheinin, D. (2000) ‘The effects of

experience with brand extensions on parentbrand knowledge’, Journal of BusinessResearch, Vol. 49, pp. 47–55.

(5) Douglas, S. P. and Craig, C. S. (1996)‘Global portfolio planning and marketinterconnectedness’, Journal of International



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