Brand Management

Consumer-goods companies which seek to use the marketing planning and control systems described in this book generally make use of the management system called ‘brand management’ to ensure that such activities are efficiently carried out. While the title of brand manager — also referred to as a product manager — may not conjure up any precise idea of its activities and responsibilities, the role is so central to the systems about to be described that it is essential to remove any uncertainties which may surround the concept, showing clearly what it is, and how it may be incorporated into the marketing function of the business organisation.

While some business organisations may be indifferent, and even hostile, to the needs of long-term strategic planning, the great majority of such organisations consider it axiomatic that they require short-term operational plans.

The areas of marketing policy to be reviewed in the compilation of a product plan will vary considerably from organisation to organisation and, within any one organisation, from market to market, or from brand to brand:

In marketing textbooks the term product strategy is widely used to refer to that strategy developed by an organisation to determine the mix of products it wishes to make available in the market-place. This is not the sense in which the term is used here. In our context the term is used to define the strategy employed in the marketing of one particular product, without necessarily any reference to other products within the product mix of the organisation. As used here, product strategy refers to the organisation’s fundamental marketing premises on which past and present policies have been based for that particular product.

The scale and range of promotional activity in which consumer-goods companies are involved most clearly differentiate such organisations from those selling to industry and the government. In particular, those consumer-goods companies selling branded, frequently purchased and relatively inexpensive domestic products may well be operating with a marketing promotional budget which accounts for over 10 per cent of total sales revenue — excluding the cost of running the sales and market-research functions. Some of these organisations may even run at a promotional budget above 15 per cent of sales revenue. In so far as such figures reflect the average of expenditure across all their products, and that some of their products will inevitably attract very much smaller percentages of expenditure — those that are aged or dying, at the end of their life-cycle — there are numerous products in the High Street shops with promotional expenditures in excess of 20 per cent of their sales revenue. This is especially evident during the launch period (say the first two years) of a major new product introduction into those medium-sized but highly competitive markets where the ‘cost of entry’ is high relative to the ultimate rewards of success.

By the provision of his promotional programme the product manager has already put into the hands of the sales force a considerable weaponry with which they can expect to fight their battles over the year to come. As such the programme is an important part of the sales policy he has planned for his product.

Dominating all his thinking, determining the breadth and scope of his plans for marketing activity, shaping all of his product recommendations, the revenue account for the product will ultimately decide the validity of the product manager’s product plans. In presenting his recommendations to the company — first to his immediate superior and ultimately to the governing individual or body of the organisation — the product manager may expect to find that, however bored and indifferent they may be to the details of his recommendations, close attention and much interest will be paid to the product’s forecasted revenue account,⁵ the final and most meaningful measure of product planning.

There is an ever-present trap encountered in the process of planning: the pitfall of laying down generalised, vague and largely unmeasurable targets as the end-benefit of the planning process. The unwary product manager may show great skill in establishing problem-areas in the marketing of his product, display considerable ingenuity and flair in the provision of a creative solution which is likely to resolve the problems he has uncovered, and then complete the process with a statement of intention such as ‘This plan is intended to strengthen the product’s distribution among independent grocers’ or The new advertising strategy will increase consumer awareness of the product’s major performance benefits.’ These objectives are worthy, well-intentioned and have a ring to them calculated to bring confidence and hope to the organisation for whom the plans are being written. However, their vagueness is likely to raise unachievable hopes and, thus, possible disappointment. If the product manager then succeeds in increasing the distribution of his product among independent grocers, it will cause it to move from one level to a higher level.

Up to this point in the examination of the product plan the impression has no doubt been given that it is the exclusive work of the product manager: he alone masterminding all of the detailed plans, heroically emerging from his seclusion to announce to the world brilliant solutions to unsolvable problems.

The product or brand manager system of marketing planning and control came into existence in industry primarily as a result of the realisation that the maximisation of potential revenue and profits for each product was not going to be achieved until one individual within the organisation was delegated planning and controlling responsibility for each individual product, brand or market category.

In an organisation which has learnt to value the benefits that accrue to it from the adoption of a full marketing orientation, the marketing and the manufacturing functions will be in accord over the paramount necessity for product always to be available to meet sales orders. While the agreement is genuine, there nevertheless exists quite logical grounds for a clash of interests between the two functions which makes the guarantee of product delivery less easy to achieve in practice:

Once the annual marketing plan has received official approval, the sales force is in receipt of a forecast of unit sales which it will need to achieve over the twelve months that follow.

The marketing planner should have a profound understanding of the financial objectives of the company, and of the financial objectives of the products for whose marketing plans he is responsible.

The ultimate means by which the business organisation achieves its aims — of growth, development, profitability and the security and happiness of all the stakeholders in the organisation — is through its ability to persuade customers to buy and rebuy the products which it has for sale.