Analysis of Brand Management Policies and Strategies for WPP Plc

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Brand Management
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Executive summary
The report essentially seeks to establish the meaning and the concept of branding, and
how it emerged as a key component of every business organization and operational
functionality. The various elements of a successful brand strategy accompanied by
theories and frameworks have been discussed in detail, along with the different
strategies of portfolio management, brand hierarchy and management of brand equity.
Collaborations and partnering tie-ups have also been effectively studied to provide an
extensive overview and critically analyse the concept of branding in the context of an
organisation.
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Table of Contents
Executive summary..........................................................................................................2
Introduction...................................................................................................................... 4
P1 Explain the importance of branding as a marketing tool and why and how it has
emerged in business practice..........................................................................................4
Branding...........................................................................................................................4
Significance of branding...................................................................................................4
P2 Analyze the key components of a successful brand strategy for building and
managing brand equity.....................................................................................................5
Components of a successful brand strategy....................................................................5
M1 Evaluate how brands are managed successfully over time using application of
appropriate theories, models and concepts.....................................................................6
Akker’s Five Assets Model...............................................................................................6
Keller’s Brand Equity Model.............................................................................................7
M2 Apply appropriate and validated examples within an organizational context.............8
P3 Analyze different strategies of portfolio management, brand hierarchy and brand
equity management........................................................................................................10
Brand Hierarchy............................................................................................................. 10
Brand Equity...................................................................................................................10
Portfolio management....................................................................................................11
M3 Critically analyze portfolio management, brand hierarchies and brand equity using
appropriate theories, models and frameworks...............................................................11
BCG Matrix.....................................................................................................................11
Porter’s five forces......................................................................................................... 12
P4 Evaluate how brands are managed collaboratively and in partnership both at a
domestic and global level...............................................................................................15
M4 Critically evaluate the use of different techniques used to leverage and extend
brands............................................................................................................................ 15
P5 Evaluate different types of techniques for measuring and managing brand value
using specific organizational examples..........................................................................17
M5 Critically evaluate application of techniques for measuring and managing brand
value in relation to developing a strong and enduring brand..........................................18
D1 Provide a critical evaluation that is supported by justified evidence demonstrating a
comprehensive understanding of branding within an organizational context.................19
Conclusion..................................................................................................................... 21
Reference List................................................................................................................ 22
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Introduction
The report seeks to study the concept of branding and its importance in today’s age as
a core marketing tool. In the context of the given scenario, WPP Plc is a multi-million
dollar organisation with reputed brands like Ogilvy, Landor, Wunderman and so on. A
business report on brand management policies and key elements was required, which
this study seeks to address. Effective strategies along with fundamental theories and
frameworks as well as their implementations have been discussed in an extensive
manner to provide a comprehensive overview of the same. The report analyses the
various factors associated with building brand equity and leveraging it over time and
seeks to establish various principles regarding the managing and measuring on the
intrinsic value of brand overtime. Critical analyses of various strategies within the
organisational setting have also been studied and discussed in detail.
P1 Explain the importance of branding as a marketing tool and why and how it
has emerged in business practice.
Branding
Branding fundamentally is a concept whereby an organization creates a name, tag,
logo, symbol and so on in the context of its products and services in such a manner that
consumers can easily identify the product to the organization (Atwal and Williams,
2017). This allows for a distinct sense of individuality and enables a product to create
awareness within the market demographics. In today’s digital age, substitution and
availability of alternative products is substantially high, as a result of which the idea of
branding becomes absolutely essential to the successful functioning of an organization.
Branding as a concept makes the use of several tools, which include promotional
campaigns, advertising strategies, creating brand reputation through consumer
satisfaction and so on with the ultimate goal of projecting the brand in line with the
organisational objectives of the company (Ertimur and Coskuner-Balli, 2015).
Historically, brands were rarely affiliated to retails products as they were mostly sold at
brick and mortar stores as staple items in bulk. With the advent of commercialisation
and the capitalistic development of economies, brands started associating with retail
sale products in order to establish a name for the source company due to a sudden
surge in the competitive factor of markets. Post world wars, when a relative sense of
stability in the context of both economic and political factors was established,
commercialisation of products really took off as the consumer base started expanding
exponentially (Rauschnabel et. al., 2016).
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Significance of branding
It is almost impossible for a company to survive today without a structured and well
founded branding and marketing strategy. The concept of branding in today’s context
has developed massively, and some of its significances are as follows:
 Trust factor: The primary idea of a brand is to generate a sense of trustworthiness
among consumers towards the product or service in question. Several factors like
the quality of a product and the utility provided also play major parts in establishing
the consumer’s confidence in a product and subsequently, the organisation behind
the product (Qian, 2014).
 Business value: Branding also allows an organisation to grow and increase its
business value massively. This is achieved by leveraging the trust factor and the
acceptability of a brand among consumers and scaling the operations to further
increase profit margins and revenue generation.
 Potential customers: A firmly established brand has an easier time attracting new
consumers as it already has a general sense of acceptability among consumers, and
consumers trust other consumers more than anyone else. A good product that is
easily identifiable and adds value to a consumer’s life will automatically receive a lot
more interest than any other standard product within a market (Zhang, 2015).
 Employee satisfaction: An organisation with a strong brand presence can
automatically translate that into a higher degree of employee satisfaction and
workplace motivation, mostly due to the positive outlook of consumers towards the
organization and the product.
P2 Analyze the key components of a successful brand strategy for building and
managing brand equity.
Components of a successful brand strategy
Every organisation in its approach to branding typically tries to maintain a very
organised and structured strategy in order to ensure efficiency and maximum consumer
acceptability, all of which eventually translates into a larger turnover and higher sales
figures. Most brand strategies can be broken down into six key elements, which are
enlisted below and are as follows:
 Specific target audience: The specific targeted audience in the context of branding
and advertising is very important, as it identifies the key consumers who in all
likelihood will buy the product or the service. Organisations that sell directly to
businesses as opposed to consumers have a larger scope in this regard, where as
those selling directly to consumers can identify target audience with strategic market
research policies and implementations
 Brand message: Every must carry a unique and a distinctly identifiable message
that consumers can relate to in order to gauge the intrinsic value offered by the
product or the service.
 Outlook towards the brand: The consumer’s outlook towards the brand and its
policies is a key factor in determining the present situation as well as the future
scope of the organization at large. Maintaining a positive outlook is very essential, as
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it is a key factor when it comes to the long term, sustainable growth of any
organization.
 Brand ideals: The brand must specifically resonate with the company’s
organizational values and principles and the factors behind its business decisions
and policies. The outlook must be clearly established and a certain degree of
synergy between the two is very important.
 Brand projection: The personality or the outward appeal of a brand is also very
important. Factors like the appeal of the logo, how easily it retains itself among
consumers; the essence and the nature of the brand and so on are key factors in
determining whether or not a brand can be successfully grown and expanded to
push the goals and objectives of the organization at large (Cooper et. al., 2015).
 Position of the brand: The position of a brand is another crucial element within
every successful brand strategy. IT comprises of various factors comprising of who
the prospective buyers are, its competing forces, advantages over these competing
forces as well as a statement of guarantee on behalf of the organization (Balmer,
2017). Simply put, brand positioning fundamentally refers to the position a brand
commands within the minds of the consensus in any given scenario.
M1 Evaluate how brands are managed successfully over time using application of
appropriate theories, models and concepts.
Over the years, several theories have been formulated by thinkers to streamline the
organizational approach towards branding and advertising. However, two key theories
have been widely regarded as the primary theories in this context, and they are the
Akker’s Five Assets Model and Keller’s Brand Equity Model.
Akker’s Five Assets Model
Akker’s Five Assets model was formulated by David Aaker where he ascertained a set
number of components within any brand under any organization that could be classified
as the brand’s inherent assets. These five assets were typically the concepts of brand
loyalty, awareness, associations, perception of quality and the proprietary assets.
 Brand loyalty refers to how often a consumer would engage in transactions with
a particular brand to fulfill a specific need or desire. The factor of loyalty was
generally determined by a strong price point, leveraging trade, pooling in new
customers and the time it took the brand or the product to respond to a directly
competing force (Dessart et. al., 2015).
 Brand awareness refers to how aware the consumers are about the existence of
a brand or a product. These typically comprised of familiarity, substantiality and
the considerations a consumer makes prior to a purchase (Huang and Sarigöllü,
2014).
 Perceived quality refers to how the consumers perceive the brand or what they
think of it. This included the quality of the product itself, position of the brand,
price, and degree of availability and presence of extensions as well (Wallace et.
al., 2014).
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 Brand associations refer to extent of recognition of a product or service within a
certain sector. Association with the brand generally includes the brand’s ability to
project information, attitudes and generate transactions (Penumaka et. al., 2017).
 Proprietary assets are also a key factor and include the various intellectual
assets of the organization. These include patents, trademarks, copyrights,
operational secrets that add value to the product and so on.
Figure 1: Aaker’s Five Assets Model
(Source: Fetscherin and Heinrich, 2014)
Keller’s Brand Equity Model
The Brand equity model was formulated by Kevin Lane Keller on the foundations that
the intrinsic power or value of a brand rests largely on the consumer’s perceptions and
outlook towards the brand. The model is often referred to as the Customer based brand
equity model and typically comprises of four key elements – brand identity, brand
meaning, brand responses and the brand relationships:
 Brand identity refers to how easily a consumer can identify or recognize a brand
and subsequently the organization.
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 Brand meaning is essentially an extending factor of brand associations are typically
in visual contexts or functional contexts.
 Brand responses are essentially the cumulative factor of the consumers’ judgments
and feelings in respect of the brand and the product. These responses are usually
based on the values of quality, credibility, purchasing consideration, competitive
advantage and the emotional reactions of the consumers at large.
 Brand Relationships refers to the degree of internalized identification a consumer
holds with a brand and a product. Brand relationships are typically founded on the
basis of loyalty and retention factors, community-driven approach and the
engagement of the brand with the consumers in general.
Figure 2: Keller’s Brand Equity Model
(Source: Richard et. al., 2015)
M2 Apply appropriate and validated examples within an organizational context.
The concept between the Keller’s Brand Equity Model and Akker’s Five Assets Model
are very co-related and similar in nature. The organization of WPP Plc, and specifically
the brand of Ogilvy today is a household name that almost every individual can
recognize and identify with.
The brand identity or loyalty concept has been laid great emphasis upon by the brand of
Ogilvy. With dedicated teams and a standard quality of work spanning over four
decades, consumers can now identify with the brand in an instant (Fetscherin and
Heinrich, 2014).
The brand extension has been another major part that Ogilvy has focused upon. From
collaborations with some of the biggest names in the media industry to association with
other massive media agencies, the WPP group has garnered a rather positive image all
factors considered.
Ogilvy being large a media and advertising agency has clearly established their hold
within the market by years of excellent work in all media forms, be it conventional like
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print, audiovisual, television and so on or in today’s digital age through social media and
content marketing.
The brand responses towards Ogilvy have been very positive in its overview, and this
can be attributed to its effective marketing strategies, scale of operations and
maintenance of quality.
The relationships between the brand and the consumer bases in the case of Ogilvy has
also been convincing in nature. Ogilvy, functioning under the WPP group, has managed
the advertising aspects of some of the biggest names in almost all industries and
sectors. There is an inherent sense of trustworthiness in regard to Ogilvy as a brand
and this has reflected largely in their revenue figures as well as the mere scale of
operations.
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P3 Analyze different strategies of portfolio management, brand hierarchy and
brand equity management.
Brand Hierarchy
A brand hierarchy essentially refers to the cumulative summary of the branding strategy
by classifying the count and the type of similar and unique elements that exist across an
organization’s offered products. This establishes the branding relationships that already
exist among the products and is useful to obtain statistical data regarding the same. Any
form of hierarchy has a certain chain of flow, and brand hierarchy is no different. Upon
observing the flow from the top to the bottom level, typically four sectors can be
distinguished:
Corporate brand – These are the mother brands or the star brands, commanding a
heavy market share
Range brand – These generally comprise of the sub brands under the corporate brand.
Individual brand – Individual brands are sole organizations with a single brand under
their name.
Modifier brand – These brands modify and alter the products of other brands after a
preliminary purchase to add their unique value to the existing product or service.
Brand Equity
Brand equity refers to the intrinsic value offered by a product to the consumer, which in
turn determines the economic standpoint of the brand at large. It is also established by
the equilibrium between the brand awareness and the marketing of the brand in
general, which provide a comprehensive overview of the organizational strategies in
general (Lin, 2015). The notion of brand equity comes into exercise during a
transaction, whereby a consumer has an assortment of choices of the same product,
but identifies and holds a positive outlook towards one brand or product in particular.
Several strategies are used in the context of brand equity:
Emotional identification: This is where the consumers can identify with a brand due a
very specific and targeted emotional factor, like motherhood or childbirth or a birthday
and so on.
Utilitarian identification: In these scenarios, consumers are satisfied with the utility
offered by one brand as compared to its competing forces and choose it over them. This
is the most effective approach as it is largely organic by essence (Schallehn et. al.,
2014).
Associative identification: This is where one brand or an organization might seek to
gain positive press by associating itself with another larger, more reputed brand.
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Portfolio management
Portfolio management in the context of brands refers the strategies implemented by
brands to ensure a sustainable rate of growth and tends to be a key component within
the branding strategy of any organization (Richard et. al., 2015). Marketing theories
typically offer two kinds of portfolio models:
The house of brands fundamentally means that a company has several products and
subsequently individual brands spread across several categories. This diversifies the
risk of failure largely, and creates a sort of cushion to fall back upon in unfavorable
circumstances.
The branded property model is the exact opposite, whereby the same branding is
used across market segments and varying categories. Most organizations, however, do
not stick to any individual model but employ a mix between the two in order to achieve
optimum results.
Portfolio management occurs primarily within two approaches:
Active management policy where by principles is adhered to in order to project the
markets, time and beat them precisely. Active management policies usually go by a top-
down approach or a bottom-up approach.
Passive management policies rely wholly on the markets with the inherent belief that
markets are not controlled and can’t be projected with cent percent accuracy. These
mostly rely on the theories of conservatism and efficient markets.
M3 Critically analyze portfolio management, brand hierarchies and brand equity
using appropriate theories, models and frameworks
Several strategies and model theories are implemented by organizations to achieve
desired results. In the context of brand equity and portfolio management, two key
models have been globally recognized and have seen heavy usage and reference in the
recent years – the BCG matrix and Porter’s five forces.
BCG Matrix
The BCG Matrix is essentially a tool developed by the Boston Consulting Group that
establishes the overall strategic emplacement of a brand or a product within an
organization based on the metrics of the growth rate within the specific industry and the
competitive standpoint of the product or the brand. Four quadrants are determined
subsequently and they are dogs, cash cows, stars and question marks.
Dogs are secondary products that do not have high cash returns and are typically not
worth developing or investing in, at least in the short term. Mitigation measures typically
include liquidation, elimination and modification (Shah, 2015).
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Cash cows refer to the most successful products within a brand and often see
sustained and prolonged degrees of investment in general. These products influence
steady sales figures and revenue generation and are generally maintained by the
organizations to supplement the star products.
Star products refer to the most identifiable products of the company and usually
convert into cash cows in the long run. They along with cash cows supply the
organization with a positive cash flow and naturally are the most closely monitored
operations within an organization.
Question marks are generally loss-making products and require large amounts of
negative investments to survive and sustain. Question marks often convert into dogs
over a period of time and organizations must consider whether they are worth
developing further or pooling cash into.
Figure 3: The BCG Matrix
(Source: Shah, 2015)
Porter’s five forces
The five forces model was formulated by Michael Porter in 1979 and is one of the most
widely acknowledged models to study a brand or an organization’s intrinsic value within
the context of portfolio management. Porter essentially categorized five different
elements upon which the value of a brand or an organization stands – competing
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