Professional Documents
Culture Documents
to Brand Rationalization
Dhanashree Borse
Roshni Shewakramani
Sourav Saraf
Vipul Sharma
Introduction
Shift in how value of firms is determined
Tangible assets (factories, inventories) -> Intangible
assets (competencies, customer base, distribution,
employees, brands)
HUL- manufacturing company -> brand marketing group
Branding- the differentiator, helps escape the
commodity magnet, greater sales, price premiums
Brands can be bought or built
Large brand portfolios- top some percentage of brands
generate the maximum sales and profits for the
company
Brand portfolio rationalization becomes important
Brand Proliferation- A costly affair
Managing mammoth brand portfolios presents the following
problems:
Insufficient Differentiation: Leads to cannibalization and duplication
of efforts
Inefficiency: Large brand portfolio -> lower sales volume for
individual brands.
Inadequate resources -> product platform sharing -> increased efficiency
but lowered perception of product variety. E.g. Volkswagen beetle and Audi
TT
Minimum amount required for marketing and advertisng a brand has
increased manifold
Lower market power weaker brands vs private labels. It has
triggered brand consolidation
Management Complexity: Tensions between marginal brands and
country managers. Focus on internal allocation than fighting
competitors
Brand Rationalization: Challenges
Retaining market share , sales volume and
customers of the doomed brands
To stem this- two brands are often merged instead of
deleting one. Only one out of 8 such attempts succeed
Failures:
Kal Kan and Crave -> Whiskas -> Kal Kan
Hilton and UK based Stakis -> Hilton.