You can easily become confused walking around a Marks & Spencer store. There is a dizzying array of barely distinguishable brands, sub-brands, endorsed brands, non-endorsed brands, logos and product descriptors. It is a world of symbols without meaning.
Take womenswear: there’s the Limited Collection, the Classic Collection and Per Una for younger women. Head for the lingerie department and brands such as Truly You, Wild Hearts, Salon Rose, MW and Cerise pop out. Just how one differs from the other is not easy to discern. You can choose between the M&S Sport bra, which is placed next to the M&S View From sports bra. Both claim to be ideal for aerobics, squash and running.
Ripping the soul out of brands
Choosing a pair of men’s shoes, you can select from the Autograph range, the Sp collection or the Blue Harbour brand – with only minor differences in style between them. There are even extensions of sub-brands, such as Blue Harbour Vintage for younger men and Per Una Dué for teenage girls. It was all so much easier when every item bore the St Michael brand name.
The proliferation of sub-brands within M&S is the subject of a review by chief executive Stuart Rose, and there is much speculation about which ones will get the boot and which will be retained (MW last week). More news is expected at the November 9 financial results presentation.
But the problem of over-branding is not confined to M&S. The world is becoming mired in a thick treacle of sub-brands such as MS Windows; endorsed brands including George at Asda and The Lion King by Disney; stand-alone brands, for instance Autograph; and channel brands, such as Levi’s mass-market jeans for sale through retailers like Wal-Mart. The effect is that monolithic brands, such as M&S or IBM, are being shattered.
Some marketers argue that the original aim of brands – to give products distinct identities – has backfired and today they tend to confuse rather than clarify. “There are far too many brands that are really products dressed up as brands,” says David Taylor, managing partner of brand consultancy The Brand Gym. “They are brand wannabees and they confuse consumers, retailers and the brand owners themselves,” he adds. He believes that the pruning of brand portfolios needs to be carried to new levels and that the overcrowded “brandosphere” must have a radical spring clean.
Companies are frantically chopping off the hydra heads, but they keep growing back. Unilever, for instance, has been shrinking its portfolio from 1,600 brands to 400 top performers, and Procter & Gamble has been through a similar process. But both are sprouting new sub-brands from these top performers, and their portfolios will need constant reviewing to ensure they stay manageable.
However, Alex Baldock, a senior manager at brand consultancy Prophet, says it is simplistic to say all companies should cut their brand portfolios as a matter of course. “Many companies have too many brands and that is the result of weak brand management in the past. There are too many people authorised to create new brands without anyone in the organisation overlooking the whole business. You end up with a house of brands that doesn’t fit together well,” he says.
Flex the brand muscle
A book by Prophet vice-chairman David A Aaker, called Brand Portfolio Strategy, sets out to show how to build a successful portfolio. Companies need clear rules on when to add brand extensions rather than allowing managers to decide as they go along. Each extension must play a predetermined and specific role rather than just being new product development for the sake of it.
Resources should be allocated to brand extensions according to the role they play in the portfolio, not on the basis of the sales and profits they produce, says Aaker, and he argues that rather than developing ad hoc sub-brands, a brand platform is needed “with a vision of the ultimate future of the brand, a set of associations that can travel and a planned program of extensions”.
A brand attempting to rebuild its platform is Sainsbury’s, whose new boss Justin King this week unveils a strategy that will refocus the retailer’s efforts on its core food offer. It is understood he will announce a cut-back of non-food items that he believes have distracted from the main platform of “good food costs less”.
Aaker cites Disney as a brand that has successfully pushed into a host of new areas such as theme parks, film and character licensing, and stores without distracting from its brand values, but rather adding to them. The creation of Disneyland enabled the characters and films to be brought to life. A range of sub-brands and endorsed brands have fed back into the master brand – what Aaker calls “brand energisers” that are designed to enhance the Disney name. But he accepts that imitating Disney is not easy, since its success comes from a heritage and culture established in the early days of film, in particular a “fanatical concern for detail in the cartoons and theme parks.”
The importance of play
There are other examples of master brands that successfully sprout off-shoots without strangling themselves. The National Lottery’s strategy of launching a range of games beyond the main Saturday draw has boosted sales and is essential to maintaining interest in the lottery. It is pushing channel extensions such as Web play to help build sales, and has just announced the launch of an SMS service for choosing numbers by text message (MW last week). As with Disney, it is the power of the parent brand and the degree to which the off-shoots support the main proposition that determine the success of the extension strategy.
Striking the right balance between parent brand and sub-brands is one of the toughest calls in management these days. Tesco has segmented its own-label products by offering Tesco Value and Tesco Finest. It is a testament to the strength of the brand that it can stretch easily across these two extremes of price and quality. In contrast to Sainsbury’s, Tesco’s brand strength has permitted it to expand more successfully into non-food areas.
By contrast, HSBC has opted for a unified brand across its thousands of branches in dozens of countries. It promotes one set of values across the world, with the exception of First Direct in the UK. Meanwhile, HBOS maintains a portfolio strategy of operating separate standalone brands.
Paul Gordon, joint managing director of agency CCHM:ping, believes that in financial services, it is probably more efficient to run portfolios of brands rather than going down the master brand route. While it is usually assumed that having a master brand is cheaper because you only need one set of marketing messages, agencies and back-office marketing roles, Gordon says: “The master brand route is in fact incredibly expensive: you have to spend a lot of money to maintain it. If you are upmarket, mass-market and a host of things in-between, you have to spend heavily to maintain brand awareness in all those areas. If you segment your brands, you can spend a little less on each one.”
All dressed up
At M&S, many observers see the proliferation of sub-brands as an indication of the company’s lack of faith in the parent brand’s ability to attract different groups. “It has to persuade people to buy M&S, but is disguising the problem with sub-brands,” says Evolution Securities retail analyst Nick Bubb.
A source believes the sub-brand review will reprieve Autograph; Blue Harbour, aimed at men over 35; Per Una; Limited Collection and St Michael. But other sub-brands, such as menswear range Sp “for dads who want to be lads” and sports range View From, along with some of the lingerie sub-brands, could be axed.
In need of support
Verdict Research chairman Richard Hyman says: “I think View From is pretty good and well made, but it is presented in store with no value added – to see how good it is you have to examine it with a microscope. The sales support is non-existent.” He believes M&S and other retailers need sub-brands to target specific groups that could otherwise be easily picked off by specialist retailers, but he thinks success is all down to how well they are executed.
Part of the problem for all widely extended brands is finding money to back their off-shoots. M&S seems to have suffered from this, giving its sub-brands only lukewarm support, and while the ranges may be good in themselves, they are weak extensions because little work has been done to explain their differentiation. M&S seems to be practising brand subterfuge – disguising the weaknesses of the parent with more and more extensions. For instance, because M&S is unattractive to young people, it has created a sub-brand to appeal them. In effect, M&S has become the brand that dare not speak its name.
An extension strategy can only really work when the parent brand is strong enough to support it. Extending a brand merely to escape its flaws creates a world crowded with empty gestures.