Brand First” Management

Journal of Marketing Management, 1996, 12, 269-280

Helena Rubinstein "Brand First" Management

u: Durneil orana j-^^ observations described in this paper are hased on working withConsultdncy, UK clients during the past decade. The approaches that have been used

were developed specifically to solve the types of issues that arediscussed below.

"Branding is the 'DNA' of competitive strategy for worlddass businesses." (Chris Macrae, Coopers & Lybrand1993).

Introduction

The discussion about the value of brands, fuelled in the 1980s by attempts to putbrands on the balance sheet, often unsuccessful, has moved in the 1990s to a debateabout whether or not brands have over-reached themselves.

Headlines such as "Brands on the Run ..." [Observer, August 1993) and "Is it theend of the road for brands?" {Media International, September 1993) are increasinglyfamiliar. The impUcation is that brands are losing share to aggressively priced ownlabel and tertiary brands, and that the trend is unassailable. Recent work firom theLeo Burnett Brand Consultancy (Brands in Decline? Dispelling the Myth, May 1994)demonstrates that far from being in dedine, the average brand has maintainedvolume share and the price differential while improving distribution.

What can management do to treat brands in such a way as to maintain their worthboth to the shareholder and to the customer?

In 1973, Stephen King wrote a seminal book called Developing New Brands. Hesuggested that multi-disciplinary project groups were needed to develop newbrands. By the time of the 1984 preface, he felt that such an approach must bebrought much closer to the " core" of marketing businesses. "If they are not, I am notsure just howr many manufacturers' flagship brands vAM survive to the 1990s'."

This paper takes King's idea a stage further. It discusses the management structureand priorities which put brands and branding at the heart of an integrated businessprocess rather than treat them as just a communications issue. In this way, it ispossible to integrate strategic intent with communications effectively and, hence,reahze key business objectives for the brand.

Wlio Owns the Brand? Who Affects the Brand? What Power does theManager Have?

The word "brand" is now so fairuliar that it is commonly heard on the lips ofconsumers and written about in the press. Yet, it is only relatively recently that

Correspondence to be addressed to: Leo Burnett Brand Consultancy, 60 Sloane Avenue, London, SW33XB,UK

270 Helena Rubinstein

people have become aware that there is a crifical difference between a product anda brand. This is not just playing with words,

"A product is something that is made in a factory; abrand is something that is bought by a customer, Aproduct can be copied by a competitor; a brand is unique,A product can be quickly outdated; a successful brand istimeless," (BCing, 1993),

This distincfion is important because it has meant, among other things, thatpeople perceive brands differently from mere products; that they are more inclinedto trust the quahty of brands; that they are prepared to pay more for the reUabOitythat this quality and trust implies. The Leo Burnett Brand Consultancy studymenfioned above found that, on average, consumers were prepared to pay 37%more for branded goods than non-branded goods,

Tim Ambler of the London Business School believes these customer perceptionsare both rafional and emotional;

"A brand is the promise of the bundle of attributes thatsomeone buys and that provides emotional safisfacfion.The attributes may be tangible or invisible, rafional oremotional,"

How this bundle of attributes is manipulated, developed and promoted affectshow the customer feels about the brand. Furthermore, how customers perceivebrands is very much in the hands of the companies who own them. The brandessence should be reflected in all aspects of the company, including producfion,management style, organization, and internal and external communications.

However, it is common to find that the issue of brands and branding are felt to bethe sole remit of the marketing department. Their role is certainly important becauseit is usually the marketing department who know most about the customer'sbehaviour and atfitudes to the market, and who control the communicafionsabout the brand. However, many other parts of the company affect the brand andhow it is delivered, and their involvement begins much earlier than thecommunicafions.

How the brand affects other parts of the organization should be considered inmuch more detail and much earlier in the process. We would argue that in order tomaintain and develop strong brands, the business of branding must begin muchearlier than it has done traditionally (after the product and only beginning w ith themarketing communications).

Branding is too important to be left to the marketing department alone. Only byapproaching branding as part of an integrated process rather than as a communica-fions add-on at the end of a product development programme, can managers ensurethat the brand remains in-line with the business objectives and strategic intent of theorganization. This approach also helps to ensure that the brand is delivered withintegrity throughout.

"Brand First" Management 271

Branding as an Integral Business Process

What do we mean by approaching branding as part of an integrated process? Thekey quesdons to ask here are:

(1) How does everyone in the business interact with the branding process?; and(2) How do branding communicadons interact with the company's core compe-

tences and other processes?

In many corporations, there is a different understanding of the brand in differentparts of the organizadon. This may mean that different people in the company havediffering expectadons of the brand, attempt to develop the brand in different ways,communicate the brand inconsistently or in the worst cases, are unable to define thebrand at all.

Within the company, the problem visibly manifests itself by successive brand ormarketing managers feeUng the need to change the brand's direcdon and messages.Given the frequent turnover of marketing personnel, this can occur every 2 years. Ifthe brand is not "owned" by anyone in the organization nor is it commonlyunderstood, there is nothing to prevent these frequent changes of direcfion.

The overafl result of this mismanagement of the brand is that consumers becomeconfused about what the brand stands for, and are more open to the promises ofcompeting brands or private label.

Brand Flow: How the Brand Affects the Organization; How theOrganization Affects the Brand

It is worth examining how brands interact with the organization before discussingpossible ways of avoiding this confusion.

Figure 1 describes the possible points where different parts of the organizadonmay affect or be affected by the brand. The key contact points will differ accordingto the sector that the company is operating in, and according to the core competencesof different companies.

Depending on the brand definition (of which more later), different parts of thecompany can radicaUy affect the abiUty to deliver the brand promise. This is notalways something which is obvious at first sight because some departments do notrecognize the part they have to play in deUvering the brand.

At the centre of the branding construct is the company with all its attendantbrands. This indudes umbreUa brands, sub-brands, corporate brands or whatever.The finance department is close to the centre of this wheel because it is they, guidedby the Chief Execudve, who set financial targets and determine the businessobjectives.

It is TA?orth noting that the mistnanagement of the brand has been exacerbated inrecent years by the increase in the power of the finance department, and thecorresponding decline in power of the markedng department. The dual demands ofshareholder short termism and the risk of hosdle takeover have driven the CEOcloser Emd closer to the finance department.

The finance and marketing departments work in different dme frames, use


different languages and rarely, if ever, speak to each other, Chris Macrae in his bookWorld Class Brands (1991) makes the point that:

"World Qass Brands integrate core business processes ,,,involving the CEO in a balancing ad between thefinandal valuers focused on measurements of business... and added value leaders."

The finance department has a significant impad on brand development and, inparficular, on the degree to wMch investment is made in communicating the brandto consumers. Finance departments are increasingly involved in dedsions aboutcommunications spend, and often seek to reduce expenditure to meet short-termtargets, TMs has an ioamediate effect on the bottom line but, in the long-term, affectsthe brand's health. Markefing departments have been slow to develop objective ordata-driven evidence wMch demonstrates the contribution made by the brand'scommunications, and so have been unable to prevent this shift in balance ofpower.

To integrate the objectives of the finance team with the marketing prindplesneeded to develop strong brands, marketing and finance need a common language,TMs wiU be discussed in the section on defining brand assets.

When asked, many depeirtments wiU say that their activities have a minimal ornon-existent effect on the brand, when in fact their behaviour may be fundamental.

Customer facingactivities

Ckiniplaints procedureClubsAftersalesRepairs

'Coxmnuiiicationsactivity-

SponsorshipAdsDirect marketingDatabasePromotionsThemes

Sales forceRetailers/HceneeesDealersPoint of salePrice

Ejctemal Brand Flow

Figure 1. Brand flow.

Raw materialsProduct qualitySourcing

Production processWarehousingDistribution andinformation system

Packaging

K & D fanctionNPD

Intemal Brand Flow


In working recently w th a shoe retailer, the author found that there were significantproblems in living up to the intended brand aim of being able "to deEver any shoerequired by the customer within 24 hours". After conducting a thorough analysis ofthe brand flow, it was discovered that the problem lay in the warehousing anddelivery section. The scheduling of the deEvery vans wras such that loading times ofonly 2 hours were allowed. This meant that although there was a 24 hour deliverj^vans were returning half empty and causing considerable disappointment for somecustomers. In another case for a food manufacturer, the production costingdepartment was found to have a significant effect on the ability of the company todeliver the quaEty that "was required to Eve up to the brand promise. In bothcases, alignment of the department objectives with brand objectives solved theproblem.

The brand flow analysis approach offers a systematic way of understanding wherethese "bottle necks" occur.

The brand flow is divided into two channels:(1) The internal brand flow. That is, aspects of the brand which are not seen by theconsumer or end user but can affect the consumers' view of it. For example, if thebrand claims to be the best quality product in the sector or that it only uses organicmaterials, the sourcing of raw materials wiE play a significant part in thedevelopment of the brand's values. If there is a requirement to reduce the cost ofthose same raw materials, it will be necessary to consider the effect the change mayhave on customer perceptions of the brand and on their wilEngness to continue topay for quality. The Body Shop is a good example of an organization where brandperceptions are driven to a large extent by the type, quaEty and sourcing of the rawmaterials.

The production process, warehousing and distribution system can also be critical.If the basic premise of the brand is one of rapid deEvery, it is critical that those partsof the organization are capable of continuing to deEver the brand promise. BothMcDonalds and Federal Express are examples of sustained delivery of brandpromise.

Research and development and new product development can also play a keyrole. For example, if a coffee creamer is defined as a brand which enhances the tasteof your coffee, it seems likely that new product development wiE be in the directionof coffee-related products and not for other types of beverage. These dedsions have,of course, to be balanced against the opportunities available in other markets, but ifit seems that the new product is incompatible with the current brand, it may beworth considering launching it under a different brand name.

As other parts of an organization are likely to influence the brand, it is importantthat a brand flow chart is drawn up for each brand organization so that the keycontributers can be identified.(2) External brand flow processes tend to be those activities which the customer seesdirectly or which are customer fadng, and are the foundation for consumerpercepfions of the brand.

The retaE, sales force and point of sale aspect is undoubtedly one of the mostimportant brand infiuences. The power of the retailer is affecting the manufacturer'sability to decide terms, and it is on the shelves where the consumer sees the branddilemma most obviously. They see it not only in terms of price but also with respectto messages on pack. Here the most obvious problems occur w hen a brand's


messages are not integrated so that the messages at point of sale or on pack aredifferent from those in other channels.

The sales force itself gives out strong messages about the brand, at both the retailand consumer level. A classic example of poor brand integration occurs in theautomobile market where all too frequently one finds that the message about thebrand delivered by the dealers is very different from that in other communications,espedally advertising. One problem here is that many car dealers operate underfranchise and have not always been treated as part of the brand. However, thiscannot be the only explanation because McDonalds and The Body Shop operatesimilar systems and suffer far less brand fragmentation.

AU forms of customer facing acti-vity must reflect the brand. This would seem tobe an obvious statement but it is not always the case. Until recently, the customerfacing activities of British Telecom (BT) were poorly perceived by their customers.Enquiries were slow to be dealt with, BT customer service teams could not give exacttimes when engineers would come to repair phones, and the repairs were sometimesleft for days. British Telecom's determination to improve this aspect of customerservice has contributed greatly to the improved perceptions of the company as awhole.

Other examples of customer facing activities that affect brand perceptions are theway complaints are dealt with or the level of aftersales service. In someorganizations, it is this part of the brand that is most important because it is wherecustomers gain direct brand experience.

Communications are often the most visible aspect of branding. Though thiselement of brand building is often thought to have most influence on people'sperceptions of the brand, in reality it comes at the end of the branding process. If allother elements of the brand have been integrated as described above, thecommunication messages wiU be easier to define, easier to keep consistent and moreeffident.

The importance of integrated communications in maintaining healthy brands hasbeen referred to throughout this paper. The point is that it is important to considercommunications in the broadest sense, including all available channels such assponsorship, database marketing etc. as well as traditional advertising.

Brand management organization has not yet been mentioned, although it is in oneof the inner circles of the brand flow process. The type of brand organization shouldreflect the needs of the brand itself.

The traditional structure is now undergoing dramatic change. A study by theBoston Consulting Group found that 90% of American consumer goods firmssurveyed claimed that they had restructured their marketing departments. Unileverhave abolished the job of marketing director and have pulled together the sales andmarketing functions. Fillsbury have puled together multi-disciplinary teams eachgathered around product groups with the stated aim to make everyone, not justmarketing, "the champion of the brand".

It seems that after 20 years, Stephen King's ideas are only now coming tofruition.

The Glue of Branding: Brand Essence

If everyone in the organization is to be "the champion of the brand", it is essential


that everyone in the organization who affects the brand has a common under-standing and can equally define and explain the brand, both internally andexternally. Everyone should be able to answer the following questions — What doesthe brand stand for? How competifive is the brand in its category? What is its rolein the portfolio? How weU is the brand understood?

What Do we Mean hy Brand Essence?

The Essence of a brand is the definifion of the main and distinctive characteristicsthat make that brand unique, and represents the source of brand power. BrandEssence is the enduring, competitive position of the brand expressed in a uniqueway.

Brand Essence should not be confused with brand image or brand values. Rather,it is the combinafion of funcfion, performance differences, image and source ofauthority that combine together to give a brand its unique worth.

Brand Essence analysis™ (Figure 2) enables companies to deconstruct and, ifneeds be, reconstruct the elements that make up strong brands. In this way, theimportant intangible brand assets can be idenfified and used. The essence elementsare shown in Figure 2. Information to explain the brand may already exist within thecompany and these elements can be measured against the compefifion. If therequired data is unavailable, it may be necessary to set up a survey to coUeci it. Thisprocess can also be used when designing a new brand.

The usefulness of this approach is that it identifies both strengths and weaknesses

Functions Image/Personality

What is it?

What is it for?

What does it do?

How do peoplefeel about it?

Do they hke it?

Do they respect it?

User imagery?

What does thecompany stand for?

How is itdifferent?

What are itsaims?

PerformanceDifferences

Figure 2. Deconstructed Brand Essence.

Source ofAuthority


in the brand, and gives guidance as to how the Essence elements can be re-aUgned.Strong Brand Essences are apparent when there is a link between each quadrant andwhere there is a degree of darity. Weak Essences tend to be found where theimpression about what the brand does or is for are confused, where there are fewreal performance differences apparent, where there is a poor image or no personaUty,and where the source of authority is resented, disliked or not trusted.

This process is best done by those people in the organizadon who are going toaffect the brand and will be responsible for deUvering it. If a muld-disdpBnaryproduct group exists, it should be this group which is responsible for defining thebrand's assets. Where a change of brand direcdon is required, the CEO and theexecutive board should be responsible.

When defining the Essence, it is important to remember that it is not anadverdsing slogan we are looking for, nor is it a description vtfhich wiU change withevery communicadon. The Essence should be a long-term positioning whichchanges rarely and it is more like a mission statement for a brand.

For this reason, brands which have strong Brand Essences tend to be those whichhave identified constimer needs which the brand satisfies and has sought to ownthem. These needs are called "core category modvators".

Volvo is an exanaple of a brand which has a pardcularly strong Brand Essence.Wherever one goes in the world, people wiU tell you that Volvo cars are a l about"safety". This is re-inforced at all levels throtigh the product design, via thedealerships and in commtmicadons. The motivadon of safety is only one of manypossible modvadons in the car market, but is very powerful for that group ofconsumers who find it appeaUng.

Essence analysis'™ can be used as a guide for dedding many of the acti'vities in anorganizadon as it can act as the "mission statement for the brand". A worldwideclothes manufacturer has used it to help them in developing their product range; arestatirant chain has used it to help in ensuring that the brand is clearly understoodby staff during a period of rapid expansion; and a sporis shoe manufacturer hasused it to focus and differendate communications.

There are many possible appUcations but the main ones are Usted below:

(1) To dedde the meaning of a brand both for the company and the consumer;(2) To maintain the integrity of the brand at aU points of deUvery and

formuladon;(3) To help to define the organizadon required to deUver the brand;(4) To be the engine for new product development ideas;(5) To drive the communicadon and adverdsing briefs; and(6) To brief new personnel both inside and outside the company as to the meaning

of the brand.

The Value of the Intangible Assets: Brand Essence and Consumer BrandEquity

There is Uttle point in going through such a rigorous process tmless it translatesthrough to better sales and higher profits. Can we say how much a brand's profitsare due to added value? Do we know what value the customer puts on thebrand?


Brands have proved notoriously difficult to value. There has been much disputeabout the advisability of putting brands on the balance sheet. The elements wMchhave been considered in accountancy-led brand valuations have sought to put avalue on the strength of different elements such as market leadersMp, stabiEty of thebrand, market prospects, internafional potential, adaptation of the brand, brandsupport and investment, and legal protection (see Interbrand approach and alsoBarrett and Bertolotti 1992).

The difficulty of tMs approach is that many scores given to these attributes are, bytheir very nature, subjective and thus not amenable to the precision that is requiredby the financial community.

Nowhere in these deEberafions is the consumer taken into account. To theconsumer, the brand has a value that justifies its price. It is possible to detect tMsvalue. Using research measures, one can separate out the effects of price anddistribution and measure it. This value is called "Consumer Brand Equity" (seeBroadbent 1992). It is a measure of the worth of the brand to the consumer conveyedas a single measurement.

The prindple itself is straightforward (although the mathematics are morecomplex!); brands with Mgh consumer brand equity are those wMch can either:

(1) SeU a given volume at a price premium; or(2) Sell a greater volume at a given price.

Figure 3 shows A has a Mgher consum.er brand equity than B, and C has a Mgherconsumer brand equity than C,

There is evidence to show that this Consumer Brand Equity decays when thebrand is not supported and grows when investment is made in the brand. This wasevident in a recent study of the wMte spirits market in the UK, w here it was foundthat the consumer brand equity of a leading brand suffered a severe drop in 1993,The commuMcafion spend had been cut, price had been reduced and, surprisingly,there was no equivalent increase in volume share. The foUowing year, the

•3

I

110 116 120

Relative Price

125 130

Figure 3. Relative price versus volume sales.


Table 1. Advertising: sales ratio

Own Label Share Advertising: Sales Ratio (

Top 10 fields 1-4Bottom 10 fields 7-3

communication spend w as re-introduced, the share grew, price returned to previouslevels and the consumer brand equity increased as weE.

These sorts of analyses have proved very useful when asking the difficult question"Has my brand been doing better or worse than the competitors?", as it is possibleto look at the performance of the whole category over time in a simple and focusedway.

Those brands with high consumer brand equity tend to be those which have aclear Brand Essence and which have been supported consistently. Stephan Buck(1994) noted in an analysis of fmcg brands versus own label that those brands whichhad continued to invest in advertising had a much lower level of own labelencroachment and were able to sustain a higher price premium.

If the value of the brand is to be recognized throughout the company, and if themarketeers are to be able to justify their claims for advertising support to the financedepartment, it is essential that measures of this nature are developed.

Consumer Brand Equity is just one tool that enables explanation of the value ofthe brand, and it is a more objective and accountable way of defending brandbudgets than the rule of thumb or estimations offen used.

Who Takes Responsibility for the Brand?

This returns to a theme mentioned at the beginning of this paper. Who reaEy ownsthe bremd and who is responsible for its well-being and continued development? Ifwe are to follow the prindples of treafing branding as an integrated businessprocess, the responsibility for the brand has to be among all those who can havesome effect on it. Unless this happens, the brand mission wiE not be adhered to.

Ultimately, the real owner of the brand wiU be the CEO who has to set the brandobjectives, dedde how best to invest in it, when to expand it into other categories orgeographies and so on.

It is, however, rare for the assumptions and expectations about brands to be madeexplicit. A statement of intent is required — a sort of brand charter which willpermit the key elements about the brand to be written down and their effects on theorganization made clear. There are many examples of how this impredsion canmanifest itself.

We have seen examples where the brand marketing team for a spedfic brand havenot been clear whether the main objective for the brand as set by headquarters wasto increase volume or to increase profit. It is common to find situations where therehas never been a decision as to how the brand should relate to the parent companybrand name. Is it a subtle endorsement or is it a more important brandingumbreEa?

What role has the brand in the portfolio? What role has it in the category? Manycompanies are realizing that they cary no longer afford to structure brands in ways


Table 2. Some Brand Charter elements

Brand essence analysis To definine the future direction and vision for the brand; howconsumers, customers and management should view the brand in thefuture.

Brand identity system The key symbols and codes of branding—how the brand is recognizedby customers, consumers and managers and how to optimize them.

Brand flow analysis How all departments contribute to delivering the brand consistentlythroughout the organization.

Masterbriefing of integrated A major gap in many companies. Ensures that communications are notcommunications fragmented and reflect the brand's essence.

Bland accountability and The balance of the quality/value relationship, appropriate long-termbudgeting brand budgets; measures of brand performance.

Brand architecture The connections between segmentations of the brand's territory; howcorporate brand and sub-brands help each other; an aid to portfoliodecision making.

which compete over the same positioning, not simply because it confuses thecustomer but also because of the extraordinary costs this incurs.

If these important questions can be agreed, they can form the basis of a "brief"about the brand, "which will set out a framework on every dimension ctnd aspect ofthe branding process for that particular brand in that particular organization. Thiswill be called the "Brand Charter".

Brand Chartering

As mentioned, a brand charter could form the basis for a common understanding ofthe core brands in a corporate portfolio, it need not be a lengthy document butshould be a short overview on everything that everyone, from the CEO to a """liorbusiness team, needs to know to have an up-to-date appredation of the bi jigprocess.

Brand Chartering™ looks at how the brand is integrated into the organization. Itensures a focus and vision for the entire organization and helps the brand ownerunderstand the strengths and weaknesses in the current branding process and howbest to translate them into a competitive advantage. It widens the' meaning of"branding" beyond just communications and design.

It is a method whereby companies can pass on or share brand know-how acrossthe business team, and the output of the chartering process is, in essence, a blueprintfor the future health of the brand which every contributor in the company canunderstand and interact with. Each charter will be different depending on theorganization, but the critical areas to be defined are shown in Table 2.

The benefits of the chartering process are not only that it makes explidt theassumptions about brands which are not often spelled out, but it also identifies thesources of the brand power. It seeks to identify the consumer opportunities from thepoint of view of "what is now possible" not "what have we done before".

The brand charter is a practical tool which can have a variety of uses. Clearly it canbe:

(1) Fart of redefining the mission for the brand (essence development), but it canalso be used;

280 Hdern Rubinstein

(2) To imderstand and define who is in control of the branding process;(3) To sell in new ideas across the management hierarchy;(4) As a record of the way the brand has operated over time;(5) To look at portfolio priorifies; and(6) As a front end to convenfional brand plans.

The process of developing a brand charter is one which needs to be undertaken byall those people who will affect the brand, but is more likely to indude input acrossthe managem.ent structure from the CEO downwards.

And Finally ...

The basic premise of this paper is that brands and branding are stiH crifical assets formany companies, and that despite the pessimism shown in the press, brands havea healthy future and can still hold their own.

However, the old ways of managing brands are inadequate to futty realize theassets that lie •within. New w ays need to be found which recognize branding as aprocess that is integrated into the business and understood with clarity by all whowork on it. It is not that marketing is dying, rather that we wiU all have to bemarketers in the future.

It •will no longer be suffident to treat branding as designing a new logo or idenfity,or writing a newr advertisement. Branding is something that world class companieswin pracfice throughout the organization.

Acknowledgements

Leo Burnett Brand Consultancy o wns the copyright to this paper.

References

Broadbent, S. (1992), "Using Data Better", Admap, January, pp,48-54.King, S. (1993), "Developing New Brands", /WT, 1973,Macrae, C, (1991), World Class Brands, Addison-Wesley,Rubinstein, H. (1993), Building Strong Brands Through Communications, Leo Bumett

ThinkPiece.Buck, S. (1994), "Growing Competition between Grocers & the Effects on fmcg

Brands", AGB, May,Broadbent, S. (1994), "Diversity in Categories, Brands & Strategies", Journal of Brand

Management, 1, May, pp.9-18.Murphy, J. (1990), Brand Valuation, Hutchinson.Barrett and Bertolotti (1992), Brand Evaluation, Arthur Andersen,

Brand First” Management

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