Brand Strategy of Philips Case Study

This case study analyzes the brand strategy of Philips, focusing on its brand architecture, potential, and hierarchy. It discusses the company's evolution in branding, the challenges faced, and the strategies implemented to enhance brand recognition and consumer engagement. The study highlights the importance of simplicity in branding and how Philips repositioned itself in the market to achieve success.

Running head: CASE STUDY
Brand Strategy of Philips
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Introduction
Philips, the big name in the technology sector is a Dutch company whose sole
concentration lies on electronics, healthcare, and lighting. Founded in Eindhoven by Gerard
Philips, it is one of the largest electronic companies in the world. With more than 100 thousand
employees across 60 countries worldwide, it is also one of the largest producers of lighting
products in the world (Merchant and Rose 2013). Brand management and planning is the
analysis of how the brand is anticipated in the market. In this report, brand management of
Philips will be discussed along with an overview on how different strategies of branding are
followed by the origination to accomplish sales goals.
Brand Architecture Strategy
The strategy is an out- inside approach to organize the brand offerings of the
company. The brand is made on the structure. From the point of view of internal structure, it has
been pointed out that the brands existing services and products are in the mode of interplay with
one another. The point of view is creating criteria through the help of the extension that can be

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perceived. Externally, this process combines within the development of the framework, which
can be perceived (Rosethorn 2016).
An unrefined brand architectural strategy of Philips, which is much before the year 1995,
led to the failing of recognizing the products’ breadth by the customers. Higher costs, which
involved marketing and branding resources, are also affecting the brand image of the company
(Hillenbrand et al 2013). Philips with its brand name “One Philips” failed to attract many
customers due to the problem in the internal communication. By taking a profitable amount of
time in order to maintain proper sophisticated structure, the upcoming risks could be mitigated.
The optimization of the expenditure is a way to allow the company’s brand to enjoy a new brand
awareness and a struggle to improve the image of the brand. Likewise, Philips also realized to
clarify and redefine its brand image. This resulted to the end of “One Philips” and the beginning
of the era of “Sense and Simplicity” and then again reinterpreting into “innovation and you”.
Accordingly, Philips had also streamlined the various divisions of the product into the three
parts: consumer products, lighting and healthcare. There are types of Brand Architectural
Structures, which include house of brands and branded house. Philips features Branded house
structures, which contains the services, and products that bear the brand name of the organization
in order to motivate communication value and purchases.
Brand Potential
It includes the vision of the brand which incorporates the view of the
management’s potential based on long- term which is influenced by the improvements of the
firm and has the ability to give recognition to the possible and current brand of the future. The
Brand boundaries are the way to identify the products and the brand who should offer the

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different benefits and also the needs which should satisfy the customers (Buil et al 2013). The
brand positioning refers to the reference based on competitive frame, point of differences,
priority and the mantra of brand. It has been accordingly claimed that Philips is a reputed and
prestigious brand. The efforts should be made to make its brand potential to make the products
for tomorrow. The Brand boundaries of the Philips offer products which give different benefits
such as mixer, tube lights, bulbs and other electronic gadgets are being used and also other
appliances with innovative methods to make the brand of the company famous. Repositioning of
Philips represented a correct example about how the branding should be. Philip breaks the
description of the product from the confusing jargon and then to the bare essentials, further
making clearer and easy to apprehend by any customers. In most of the cases, their product line
does not surpass more than one line text. In order to give importance to the name of the brand, an
Advisory board has been created whose function is to give the perspectives of outside which
encompass the continued efforts, which are targeted towards their promises. Philips focused on
the portfolios of Brand, which incorporates mainly the way to attract the customers and to
enhance the internal competition within the firm. Second, to attract the particular segment of the
market, which is still not covered by other competitors as the market is new to capture.
Brand Hierarchy
A brand Hierarchy is a way to summarize the strategy of branding, by displaying a
number of elements of the brand (KALININA 2014). All the brands are having a small
beginning like Philip, who includes the descriptor of the product, level of modifier, brand level
of an individual, family brand level and then comes the company brand level. It follows the level
of individual and modifier brand level. Philips, in the beginning faced problems in terms of what
is the number of levels that a brand must use and to allocate some of the specific types of

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products under the umbrella of one brand (Som and Blanckaert 2015; Duin, Ortt and Aarts
2014).
Conclusion
The branding of a product acts as an ambassador of the product. Great products can be
unsuccessful due to wrong brand management strategy. Philips needed a brand repositioning
because of its complex approach to marketing and thus, the change in the tagline and new
marketing strategy, regarding branding helped the organization to gain the position they are in
today. It is understood by branding promotion of Philips, that simplicity is the need of the hour.
The complex and complicated subject can overshadow a brand. It is necessary to know and
understand the need and communication capacity of the consumer, to provide a positive brand
valuation to the consumer. Due to its strong branding promotion, the organization has been able
to change itself from being an endorsing brand to a monolithic brand. Company’s future
endeavors and plans to incorporating into greater Philips brand have empowered it to come up
with the tagline “sense and simplicity”.

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Reference
Buil, I., De Chernatony, L. and Martínez, E., 2013. Examining the role of advertising and sales
promotions in brand equity creation. Journal of Business Research, 66(1), pp.115-122.
Chao, P. and Jo, M.S., 2015. The impact of brand, attribute strength and country-of-origin on
product evaluation: A web survey. In Proceedings of the 2000 Academy of Marketing Science
(AMS) Annual Conference (pp. 186-191). Springer, Cham.
Duin, P.A., Ortt, J.R. and Aarts, W., 2014. Contextual Innovation Management Using a Stage‐
Gate Platform: The Case of Philips Shaving and Beauty. Journal of Product Innovation
Management, 31(3), pp.489-500.
Hillenbrand, P., Alcauter, S., Cervantes, J. and Barrios, F., 2013. Better branding: brand names
can influence consumer choice. Journal of Product & Brand Management, 22(4), pp.300-308.
KALININA, M., 2014. Capturing meaning through Brand value and Green
marketing. Управленческие науки, (1), pp.52-58.
Merchant, A. and Rose, G.M., 2013. Effects of advertising-evoked vicarious nostalgia on brand
heritage. Journal of Business Research, 66(12), pp.2619-2625.
Rosethorn, H., 2016. The employer brand: Keeping faith with the deal. CRC Press.
Som, A. and Blanckaert, C., 2015. The Road To Luxury: The Evolution, Markets and Strategies
of Luxury Brand Management. John Wiley & Sons.

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