How to formulate a brand strategy?

Brand has become one of the strategic factors in corporate competition. Formulating a clear brand development strategy will help companies gain a competitive advantage in an involutionary business environment. However, many companies do not have strategic guidance in brand management and are busy following or imitating brand marketing actions, spending manpower, material resources, financial resources and time, but the brand fails to establish brand competitiveness.

Why does this situation occur?

The most fundamental thing is that the brand does not have a development plan, and the reason behind the lack of a development plan is the lack of a development strategy.

Therefore, in the current and future business environment, companies urgently need to formulate brand strategies to guide the long-term development of the brand. This article will provide a theoretical tool model for formulating brand strategies - the brand strategy tetralogy, to help companies formulate effective brand strategies. (The brand strategy quadruple theory is our latest thinking on brand strategy, enriching the original strategic triangle model.)

Before introducing the model in detail, we must first define the concept of "brand strategy". Because this word has some basic meaning in our minds, we need to clarify the original meaning of this word. (This part is more logical, you can skip it and go directly to the theoretical content)

Defining brand strategy

There are currently many schools of thought regarding brand strategy, and each school has different opinions. The most notable of these is to elevate one's own tools or methods to the brand strategy dimension in order to define the brand strategy.

The thinking logic of this definition is bottom-up, leading from one point to brand strategy, without truly looking at brand strategy from a strategic perspective.

There are problems with the origin and path of thinking, so the brand strategy extended from this idea is bound to be one-sided and subjectively magnifies the impact of local tactical points.

Strategy, of course, is a holistic view, from top to bottom, looking at the overall map and the overall situation.

Therefore, we must first define the brand strategy. The first thing to be clear about is to determine the basic logic of strategic thinking.

It is necessary to think from top to bottom and then verify from bottom to top to form a logical closed loop.

Based on this closed-loop logic, let us define the brand strategy.

Brand strategy is the path and results of thinking from a global perspective.

The path and results of thinking are composed of some key elements, which must play a decisive role in brand development.

Which elements play a decisive role in the development of a brand?

This is the core of the brand strategy quadruple theory discussed in this article.

By continuously reducing the various forces that influence the brand, we will eventually refine the key factors that influence the brand strategy into four key elements.

They are: brand development positioning, brand core value, brand association, and brand portfolio architecture. It is called the four-component model of brand strategy.

Taozhi-Brand Strategy Four-Element Model

These four elements have a significant impact on brand development and are the key to establishing brand competitive advantage.

Let's explain them one by one:

The first element: brand development positioning

What is brand development positioning?

Here we need to distinguish the concept of positioning. The earliest domestic positioning comes from Ries and Trout (for more information, please read this article - A Brief History of Positioning). The main idea is mental positioning. In the early years, this concept was mainly used in advertising communication.

Now people have different understandings of positioning, including product positioning, price positioning, crowd positioning and so on.

It is observed that in the current business environment, people's understanding of positioning is still more about describing what the company or brand does and explaining where they want to go. For example, we say that Alibaba is positioned as a b2b platform that provides a full range of services to b-side enterprises.

Currently, many companies understand positioning in this way, which leads to confusion of concepts.

Mental positioning and the positioning mentioned later are completely different things.

While we are assisting enterprises in their development, what they really need is development positioning.

Development positioning: Specify the direction for the company's development, use matrices or measurable analysis tools to analyze market opportunities, and thus position the company's development over a longer period of time.

This is an urgent need for enterprises in the increasingly complex business environment now and in the future.

Therefore, this concept is named brand development positioning. The core is to position the long-term development direction of the enterprise, including business choices, market segments, market opportunities, market share and growth, and enterprise resource cost matching.

This element is the root of brand management. Only with a clear business and development direction can all subsequent brand actions be carried out.

Therefore, when we analyze a brand, we can first analyze the brand development positioning.

The second element: brand core value

What are the core values ​​of a brand?

Here is a quick explanation. For more details, please read this article (Establishing Brand Core Value Identification).

The core value of a brand is the real competitive barrier that a brand has from a brand perspective. It is the core value of a brand.

A company is a business entity that delivers value to customers/consumers and earns profits from them.

So, when delivering value to clients and consumers, it is inevitable that they will be imitated and copied by peers. What should we do at this time? Establish brand core value identification.

Products can be imitated, brand identity can be imitated, brand communication content can be imitated... but the core value of a brand is an element that competitors can never imitate.

Apple’s core value is not iPhone or Mac, but innovation and uniqueness.

The core value of Starbucks is not a cup of coffee or the mermaid logo, but providing a third space for leisure, small gatherings and atmosphere.

Disney’s core value is not its IPs, but to continuously bring happiness and beauty to the world and people.

These great brands have unparalleled brand competitive barriers, and their core values ​​are the brand's stabilizer.

After determining the brand development positioning, the next thing to think about is what value the brand should convey to users and what the core value of your brand is.

This value needs to be achieved over a long period of time. It is not just a slogan, but it must eventually be imprinted in the hearts of consumers.

The third element: brand association

Brand association is first and foremost based on the core value of the brand.

Brands use a series of scattered associations to convey and enrich core values.

Brand associations are the mental associations that consumers have with a brand, and these associations exist in the minds of consumers.

A powerful brand association is an interwoven network of associations that work together to form a tight information complex that is deeply engraved in the minds of target customers and can be filtered through decades.

Brand associations include: core values, brand vision, brand language, product packaging, brand reputation, brand spokesperson, overall perceived impression of the brand, brand awareness, brand founder, etc.

Regarding brand association, Ake has an in-depth analysis of it in Brand Assets. Friends who are interested can read it in detail.

In this paper, its impact on brand development as a strategic element is mainly discussed.

Why is brand association a strategic factor?

On the one hand, it is because the above elements do have a great impact on brand development; on the other hand, when we evaluate brand value, virtual assets are greater than physical assets, and many components of virtual assets come from brand associations.

Therefore, whether from the perspective of development or the accumulation of asset valuation, brand association is very important!

The fourth element: brand portfolio architecture

The combination and structure of a brand helps the brand to maximize its value and gain profits through the construction and utilization of brand assets.

Brand portfolios and structures are more commonly used in group companies. Brand managers need to manage group brands and branch brands, and use the assets of existing brands to extend and shrink the business scope.

When we determine the brand development positioning, we determine the general direction of brand development.

When the core value of a brand is determined, it also determines what value the brand will convey through its products and services.

When brand associations are determined, the brand value forms detailed touchpoints to reach consumers and customers and deliver value.

The brand portfolio architecture is the implementation of the first three elements. What value will it deliver in which businesses? What associations to shape and use? Is business development and development positioning on the same track? How to extend business scope based on strong brand assets, and then better utilize brand assets to form a dynamic brand management strategy?

At present, most of the brand combination methods on the market are summarized based on the current situation, forming roughly four combination architecture models: single brand architecture, main and sub-brand architecture, endorsement brand architecture, and independent sub-brand architecture.

Summarizing from phenomena is an inductive method, which can only provide us with a reference. When making brand decisions, it is more of a deductive logic, which means that we need to deduce and think for ourselves about how to combine the structure to make the brand develop better. We cannot simply apply cases.

Regarding brand architecture, I will give a detailed explanation in one or two articles in the subsequent brand series articles.

So why is brand portfolio architecture one of the elements of brand strategy?

Also, because this decision is a strategic one, when the group brand has a complex business portfolio and a large number of brands, it is easy to have unclear management authority, irregular use of brand assets, and brand confusion...

Sorting out the relationship between business and brand, and the relationship between brand value and brand association will help the overall brand group to be more collaborative, clarify organizational management, and make overall resource utilization more efficient, thereby becoming more competitive in sustainable development.

This completes the explanation of the core elements of the four-element theory of brand strategy. This is also my latest thought on brand thinking, and I hope to contribute a powerful method tool to brand development.

Companies can tentatively use this model to analyze their own brands. The 4-element theory is a strategic framework. Each element has detailed analysis points. Of course, you can also contact us to help you with more in-depth analysis and insights to see where the problems in brand development lie and how to solve them. Help brands build long-term competitive advantages.

Author: Jia Tao Jia Tao

Source: Jia Tao Jia Tao