Brand Equity of Maggi Essay Example

In conclusion, the conventional pyramid marketing models have led to a diffusion of accountabilities and increased specialization of managers in specific aspects of the brand. To address this, Danone Group has streamlined its corporate structure from four layers to three, assigning roles such as a brand marketer, who handles overall brand management, a brand marketing manager, and a marketing director tasked with coordination and specifically handling 'mega-brands'.

The end of dispersal:

In the context of a brand's modern internal surroundings, the concept of brand equity signifies the importance of managing this equity's value. The crucial term here is 'capitalization', but it appears challenging to capitalize on multiple brands simultaneously, unless the business is a robust multinational. Consequently, most organizations shrink their brand portfolios and concentrate solely on a single or a few brands. Fundamentally, brand portfolios are frequently overstocked, owing more to successive buyouts rather than comprehensive planning of each brand's responsibility towards its consumers. This trend is more accentuated in the industrial sector as numerous companies expanded via acquisitions; they now face the task of managing a plethora of local brands, product or product-line brands, and corporate brands, along with an assortment of issues for which they were not ready.

The practice of reducing brand portfolios has led to few brands encapsulating a wider array of products. For products that lose their original brand, they need to be reallocated to existing ones. For instance, the Danone brand now includes more than 100 different product lines. This has necessitated the creation of intermediary brands for specific product lines to structure Danone's comprehensive product range, e.g., Taillefine tailored to waist-conscious

consumers, Charles Gervais aimed at gourmet adults, id catering to children and Bio for the health-aware population. Each of these product line brands targets a distinct market segment and is positioned to include several sub-brands of its own. At Danone, they no longer focus on individual product brands.

Danone's complete array of products is systematically arranged, both internally and across different product line brands. Each product line establishes its individual brand image goal but they all uphold two significant aspects of Danone's identity - closeness and health. Similarly, the Nestle Company chose to focus on a small selection of primary brands, which serve as the originating brand for an extensive variety of products and sub-brands.

The End of new brand proliferation:

The focus on capitalization has effectively curbed the growth of new brand and product names which previously was a disadvantage for all major conglomerates. Indeed, any project lead with the responsibility of introducing a new product is often inclined to assign it a unique name, its own brand identity. This holds particularly true in the industrial sector where bestowing names is essentially the only path for both the manager and the fresh product to instantly secure widespread recognition.

The days are gone when corporations, inspired by the conventional Procterian concept of product branding, would secure large numbers of brand names for their emerging products. Such an approach turned out not only costly but also inefficient, as majority of these names, while officially classified as brands, carried no significance to consumers. It would have been more prudent to only preserve the most recognizable names and convert them into umbrella brands.

This is the sole method to leverage.

After encountering a recurring issue, Nestle took the initiative to establish a dedicated branch for brand management at their main office in Vevey, Switzerland. This department was exclusively assigned the task of developing new brands globally. This innovative strategy yielded significant results. In 1991 alone, Nestle rolled out nearly 101 new products all over the world, despite creating only five new brands. As a result, 96 new products were launched under the protection or with the backing of existing brands. For instance, the Nesquik brand was used to introduce chocolate-flavored cereals because of its alignment with the product's intent - offering mothers a strategy to encourage their children to consume milk.

To avoid being seen as an arbitrary controller or suppressor, 3M dispersed a manual across the globe and internally, outlining the market situations where the establishment of new brands would be permitted, as well as the most common conditions under which inventions must carry one of three name choices - the generic one combined with the 3M brand name or the specific name inside an existing product line brand. This approach facilitated the internalization of some key management ideologies. It's for this reason that demands for new brands within 3M reduced from 244 in 1981 to 70 in 1991.

In the given year, only four brands got approved, in comparison to 73 in 1989, indicating how 3M's all-embracing international and global identity has made it impossible to develop local brands. The sole exception to this rule is when a new primary need emerges, like in the instance of Post it. The development of new

subsidiaries such as Scotch's "magic" can only be considered if using the main brand name (Scotch, as an example) doesn't provide enough product differentiation.

Building Brands with innovations:

From afar, these principles may appear to constrain the creative force. Once you delve deeper, however, they are found to be the linchpin in revamping established brands, boosting their value, and expanding their global influence. Brands can only flourish by continually evolving and if the new offerings contribute substantially to their overall sales.

By proving their aptitude to advertise new products meeting modern demands and fulfilling fresh necessities, brands display their current relevance. However, most often, product managers opt for introducing innovative products under their newly created brand name. This practice hinders the existing brands from basking in the modern appeal brought about by new product releases. This was evident when Nestle+ managers decided to brand their new instant mashed potatoes as Mousline, instead of incorporating it under their mega-brand Maggi. This not only tarnished the image of Maggi but also made it look slightly dated.