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Brands, many lives?By Martin Payne One
of the issues facing brands today and in the future is the apparent shortening
of the “product life cycle.” While many brands continue to lead their
markets after many years, others have short life cycles and are frequently
designed with this in mind. Brands either live or die. They can innovate and
evolve or they can be designed for a short life. Through the Loop’s Brand
Positive™ research programme has uncovered some of the reasons why life cycle
theory should now be revisited to ascertain how brands are being developed for
short lives. Strong
brands remain strong Numerous
studies have shown that many brands that were leading the market years ago are
still in that position. To a large extent it has been proved difficult for a
challenging brand to overtake them. This means that they have the ability to
extend the life cycle or, possibly, the effective marketing of these brands has
meant that the life cycle, in its purest form, does not exist. The brand must
remain relevant in an ever-changing marketing environment. It must continue to
provide consumer value. Market
leaders have an in-built advantage that makes it easier for them to survive than
number two or three brands. For example, some of the factors that tend to favour
leading brands are as follows:
Moreover,
these brands have been highly active in ensuring that their lifecycle is
continually renewed. Nescafé, for example, has maintained its position as the
UK’s leading instant coffee brand through frequent updating. This has extended
the brand beyond the core Nescafé coffee into variants such as Espresso and
Cappuccino as well as different bean types and, most recently, an organic
variant. However, while the brand remains modern and relevant, the core brand
values do not change and this is the key to its endurance. The
constantly-changing brand The
alternative way to retain a brand’s freshness is to keep changing it. This may
be more relevant in a marketplace which is experiencing rapid change and the
brand can reflect and exploit this by exhibiting new traits. This could also be
a method of attracting the consumer’s attention. In the impulse confectionery
market in the UK, the three major manufacturers Mars, Cadbury and Nestlé have
launched “limited edition” brands. These have the effect of bringing
interest to the category. Gerber Foods is recognising the seasonal nature of
fruit through its Spring 2000 UK launch of Ocean Spray Cranberry Seasons. This
new product has a seasonal life and is replaced with the change of seasons. Target
market issues A
product or service may have a series of short life cycles. This may occur where
the product or service is used for a short time only and the target market
itself is constantly changing. For example, baby foods manufacturers gain and
lose consumers all the time. This means that there are always opportunities with
new consumers and “established” buyers move out of the market. In this case,
there cannot be one life cycle but a whole series. Other areas that are
time-dependent include toys. Look at the longevity of brands such as Barbie that
has been a best-selling toy for generations of girls. Globalisation
and rapid communications shorten time cycles Outside
factors that impact on a brand mean that it can often be advantageous to look
outside the home country for areas of development. This works two ways and
cross-border marketing means a much greater level of competition. The
Internet has been a significant inflection point here as it enables the rapid
dissemination of ideas and development of products around the globe. In effect,
it acts to shorten the life cycle in many categories. High profile dot.com
failures will not just be the result of instable business models or poor
management but could also relate to the fact that simple ideas based on open
technology standards can be easily copied. The
dynamics of innovation Innovation
is, by its very nature, only short term. To be innovative, a company or brand
must strive for constant leading-edge development, thereby ensuring that it
remains ahead of its competition or develops new categories that it can exploit
before the competition reaches parity. At this stage, the genuinely innovative
company must be launching version 2.0 or moving into the next market. This is
all the more apparent in fast-moving markets or in sectors where there is
intense competition. However,
the fast pace of development may frequently mean that the product or service
development encounters problems that lead the launch date to be postponed. While
this itself may not be an issue, there is a potential for consumer confusion, or
even negative publicity, as the communications programme may already be
underway. A recent example here is the launch of its Internet banking arm
Intelligent Finance by the Halifax bank where advertisements had to be taken in
the press to explain that there were technical problems with the service and,
even more recently, Barclays announcement of security flaws in its on-line
banking. While
early publicity may be necessary in this type of environment, cynically to
ensure that consumers wait for the product or service rather than opting for a
competitor, there is the danger of launching a product or service that does not
yet exist or does not function correctly. Any ensuring publicity could be viewed
as a necessary risk. Nevertheless,
innovation is crucial. To put it simply, it is more effective to make your own
product obsolete before your competition does. It is important to be developing
future versions of a product or service so that the product lifecycle is
restarted and competitors are always playing catch-up. More
lessons from the information technology sector As
marketing moves away from mass marketing towards customisation and, ultimately
personalisation, the life cycle may help to address different target markets in
turn. This theory is popularised in Geoffrey Moore’s series of best-selling
books on IT marketing but there is no reason why this strategy cannot be applied
to other categories. Geoffrey Moore’s “bowling alley” approach refers to
picking off different market segments, one at a time. All the time, this
continues to build critical mass for the product and focuses marketing
resources. It helps the product shift from early adopter to early majority
status and move away from “the chasm.” This may be achieved by the
recognition that the life cycle varies for each different group of consumers.
Product development and marketing communications can thus be organised to suit
the target segments. Summary The
current and future brand marketing environment is being becoming more
competitive and the pace of change is accelerating. One approach to harness this
for the company or brand’s benefit is to revisit life cycle theory and
undertake development on a short-term basis. This could include the recognition
of different product life cycles for different consumers or different target
segments. There is no shame at all in launching a product or service that can be
copied by competitors but continual updating is vital to always stay one step
ahead. The product launch date could be viewed as the start of the
development process not the culmination. Through
the Loop’s Brand Positive™ Knowledge Development Programme has recognised
that identification and application of life cycle theory is becoming a key to
future marketing development. This feeds into a range of solutions such as
Horizon™, Blackjack™ and Bedrock™ that can be offered to clients to
address brand evolution issues. These impact across different time scales
through short, medium and long-term. Pool, Autumn 2000 |
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