Harvard business case

1. What are BRANDS good
for ?
HARVARD BUSINESS SCHOOL CASE

2. CHANNEL MEMBERS BRAND MANAGERSCUSTOMERS
Who are the Key Players in this case ?

3. What is the present
Situation ?

4. SITUATIONAL ANALYSIS
Brands lead to aggregation of consumers by influencing the mass
With the advent of Information revolution , 2 way communication has
been better in ensuring consumer relationship than 1 way
communication
Consumer disaggregation is more efficient & profitable than
aggregation , the traditional source of Brand power
Retailers argue that the economics of disaggregation favor them and
that they have greater credibility in assembling an assortment of
brands that makes sense for the consumer.
So ,its time for Brand managers to highlight the role of their Brands
1/4

5. SITUATIONAL ANALYSIS
So , the new era has seen a shift in focus from :
One to one communication ,
personalized marketing with the
consumers
Mass communication which
could not lead to Consumer
satisfaction of every consumer.
T
O
2/4

6. So the Channel members don’t prefer aggregation through brands
anymore ; they now insist on Market segmentation following
disaggregation.
SITUATIONAL ANALYSIS 3/4

7. So , now a question mark now hangs over their future
purpose and role of BRANDS
And the purpose of this case is to explore what the
Brand managers could do to justify the roles of their
Brands
SITUATIONAL ANALYSIS 4/4

8. As an example :
Kraft Foods has developed & launched the most elaborate disaggregate
marketing initiative in the packaged goods industry and the program’s
flagship is its quarterly personalized magazine named “food & family “.
The free magazine is an effort to build and enhance consumer
relationship

9. As an example :
Kraft Foods has developed & launched the most elaborate disaggregate
marketing initiative in the packaged goods industry and the program’s
flagship is its quarterly personalized magazine named “food & family “.
The free magazine is an effort to build and enhance consumer
relationship
But how does it explain
the phenomenon of
segmentation &
disaggregation ?

10. SEGMENTATION
The publication arrives in
consumers’ mailboxes
quarterly, only after people
who want to receive it have
registered. This way the
company has segmented the
market
DISAGGREGATION
The magazine is personalized
to the individual consumer. For
example, someone who
corresponded with the
company by e-mail may receive
a magazine in which the inside
cover page points the reader,
by name, to the relevant
sections in the publication
where answers to specific
queries may be found.

11. Highlighting the objective of the company :
Kraft foods tried to enhance its consumer
relationship and consumers’ satisfaction .They did
that successfully by the launch of the personalized
magazine .
But what about the cost spent on the program ?

12. The costs of the program are set against the
benefits of reaching Kraft’s most loyal and
profitable consumers in a targeted manner,
providing opportunities to communicate
directly with them outside of traditional media
and retail channels. And some of the costs of
publishing and distributing the magazine are
defrayed by third-party advertisers such as
Ford, Tupperware and even Campbell Soup,
which are keen to tap into such targeted
exposure for their brands.

13. This program
highlights 2 central
facts of
Disaggregation

14. 1 The locus of the consumer relationship is likely
to shift :
PRODUCT BRAND UMBRELLA BRAND
TO

15. 2 Tactical activities such as competitive reactions,
product-trial coupons and selective promotions are
implemented with targeted consumers or segments
rather than at the brand level

16. THE CHANNEL RELATIONSHIP
Retailer’s business is no longer
LOCATION BASED APPROACH

17. RELATIONSHIP BASED APPROACH
Its about adopting

18. In most of the developed countries today ,
major portion of the Brand’s marketing budgets
is spent on Retail and Retailers
But then by this , Manufacturers are basically
feeding their potential rivals
So how should they deal with this imbalance of
powers ?
RETAILER –MANUFACTURER RELATIONSHIP

19. This can be done through “Disaggregation”
Disaggregation ( the new medium ) provides them
the opportunity to influence consumer decisions that
is independent of the Retailer .
So this new medium provides manufacturers’ the
medium to know their consumer better than retailer

20. But then it’s a race as Retailers are also not
sitting idle.

21. Initially Retailers used Brands
like Coca-Cola , Tides as
medium to attract consumers
….
But gradually Brands were
unfollowed when retailers
started using Disaggregate
Consumer data .

22. As an Example
Company used its Loyalty Card to personalize
consumer’s shopping experience .

23. Case of a company
In 2001 P&G launched its consumer
information-based marketing initiative
under the banner “Golden Households
Its objective was to get the understanding of
Segmented market

24. The ISSUE was : That the Consumer data obtained
through this covered only a small segment of
Consumer behavior .
So they had to merge their information with
that of Tesco’s
P&G’s U.K. launch of its Physique hair-care
brand was executed exclusively through Tesco
channels

25. In 1931, P&G pioneered an
organizational innovation, the
brand manager, as a means of
focusing the firm’s resources on
key market opportunities

26. The Brand management organizations
Now entrenched Brand-management
organizations are proving to be an impediment
to the adoption of consumer-level
disaggregation initiatives.

27. BRAND MANAGEMENT AT
KRAFT :
At Kraft, the information-based marketing program
is treated as an add-on to existing channels for
reaching the consumer. The brand manager can
choose to put money in this program or to continue
using only traditional media. Brand managers
continue to be concerned with the marketing and
sales of their brand rather than the profitability of
the entire portfolio of brands. The focus of
marketing efforts remains the brands, not the
consumers

28. But………..
Brand Management systems were designed
for an era of mass marketing and are not well
suited to making good use of the tidal wave of
valuable consumer information that is now
available
Like , in case of an automobile industry , it has
been difficult to track consumer segment
information while pulling Brand Information
from the management systems has been a
much easier game .

29. A Consumer
So the new focus point
should now be consumers
rather than Brands

30. But the change cannot
happen overnight
To understand the nature of the changes
required, managers must recognize the need for
changes in any new structure

31. 1.Relationship-building entity and
mechanism.
2. Targeted communications that can
exert a tactical influence on consumer
behavior.
3. Obtaining expertise in new-product
and brand development so that the
portfolio of product brands can be
continually rejuvenated.
Need for 3 Elements in the new structure

32. Other changes in the new structure
1. Required in the measures they use to gauge
success.
2. Required in incentives & awards used to motivate
people.
3. The way they deploy resources t the market.
4. The manner in which the teams co-ordinate the
market opportunities.

33. The Value Propositions of Brands
Brands were initially confined to Packaged Goods

34. But now they are everywhere
In service sector In B2B sector

36. Brands have the power of
appealing to the mass
strongly

37. But what about the Question of Brand’s Future
purpose and Role ?
Initially Disaggregate marketing was just an add-on but now
it has become a completely different way of doing business
Major advances in
Information Technology has
made it much easier for
businesses for doing one to
one communication with
the consumers and
adopting Disaggregate
marketing

38. So , what are then BRANDS good for in this new
environment ?
Brands are an excellent means of developing and
communicating a differentiated value proposition in
the market
1

39. A manufacturer’s umbrella brand might even
rightfully aspire to the ultimate prize — a relationship
with the customer.
2

40. UMBRELLA BRANDING

41. Features of Umbrella Branding
1. Umbrella Branding makes different product lines easily
identifiable by the consumer by grouping them under one
brand name.
2. Umbrella branding generates savings in brand
development and marketing costs over time and can create
advertising efficiencies.
3. It is the branding strategy that gives the probability of a
brand extension for every possible quality of profile.

42. So it is on this task companies
should focus their attention on , in
this new era of Disaggregation.

43. TAKE AWAY FROM THE CASE
Can we generalize the merger of Umbrella
Branding with Consumer Disaggregation in
every market Scenarios , by the Brand Managers
?

44. "These slides were created by Jalaj Garg(IIT-
Guwahati), as part of an internship done under the
guidance of Prof. Sameer Mathur
(www.IIMInternship.com)"