A brand portfolio, especially a successful one provides companies with secure sources of revenue. But the fact remains that in times of competition even strong brand portfolios may face a reduction in their customer base.
Although a brand may hold a large portion of the market share, competition can slowly but gradually snatch away this hold. Hence a company should check whether its product range is fulfilling the demands of its target market keeping in mind the changing environments. For example a successful brand of shampoos may be catering to different people; those with dandruff problems, dry hair issues, lice infections etc. yet the organization fails to keep track of the pressures of the economy on the consumer’s pocket.
Inflation may force them to leave brand preferences and loyalties to move towards a less expensive item. Therefore not only should the product be fulfilling the customers need but also consider their affordability.
The fact remains that a large brand portfolio may not always be necessary to keep ahead of competitors. Unilever announce din 1996 that it would decrease from 1600 brands to less than 400 in four years, clearly proving the fact that large brand portfolios may lead to unnecessary costs and reduction in profits.
But this does not mean that the company should reduce itself to only one brand as many of the companies cannot do such a thing even though a strong brand can provide greater amount of efficiency. Companies should try their best to focus upon few strong brands which allows a company to target different customers or to work in different channels, providing very strong for multiple strong brands to co-exist.
Whatever the size of the portfolio is it is vital to keep the customers in hand. Communicating properly with them through great marketing campaigns, clarifying and embedding the image of their brand in the minds of the customers.
Catering to niches may be successful such as Rolls-Royce serves to a certain class only but for items of daily use it is beat to have more than a single brand to cater to maximum sectors of the society.
The main point to remember in this game is to ponder over:
- What is the purpose of your brand?
- Is it capable enough to communicate the message to the targeted audience?
- Production process should be less complicated
- Is the marketing of the product effective
- Try to be simple yet strong
- Rationalize your options
- Your brand should represent your company
- Keep an eye on your budget don’t exceed it
- The delivery should be prompt and quick!
Even though it is really hard for company to decide which of it’s brand to carry on and which one to drop but this decision is critical and should be made as early as possible. So harness yourself for tackling the competition in the market and keep your fingers crossed!