In the beginning, heaven and earth were created. Then came the strategy. This is how a “Bible of Branding” might begin, because in the world of brand development, nothing is as important as a well-thought-out strategy.
Brand Strategy – A Definition of Success in Competition
What in ancient times defined the competence of ancient Greek military leaders has today become a term that, since the 1950s, has made its way into mathematics and has also found its place in our modern and highly competitive business world. Essentially, the term remains true to its ancient essence, as it is about managing conflicts while considering all other actors. Specifically, brand strategy deals with the question of how a brand can systematically develop by considering its own business model, the identified target audience, and competitors. It thus forms the cornerstone for all further branding actions. After all, what kind of design is a graphic designer supposed to create if they don’t even know how the brand wants to position itself externally? What colors should they choose, and why?
Without a clear strategy, the brand’s added value is hard to communicate in clear messages, and others can only identify with it to a limited extent. It serves as a clear guide that plays an overarching, or at least subordinate, role in every business decision – and not just in creative business areas.
Brand Strategy and its Differences at a Glance
So, what brand strategies are there? And are all of them equally relevant in practice? Below is a brief medley of the most interesting and most commonly seen brand strategies, which, when taken together, are referred to as brand architecture.
Let’s start with the simplest: The Corporate Brand. With this strategy, every product and service of a company is launched under the same name and appears externally as absolutely identical. For the consumer, a product brand and the corporate brand (Corporate Brand) are thus one and the same. This not only makes communication during the launch much easier but also leads to a transfer of the company’s (hopefully) positive (or negative) image to every individual product line or brand. A well-known example from practice is the Swedish furniture company IKEA, which releases all of its products under one brand, globally. However, such a blessing can also become a curse if, for example, a new division with a different business model or strategic focus is launched. The resulting confusion can limit a brand in the long run, which often can only be addressed through rebranding.
By the way: If you want to learn more about rebranding, this article is particularly worth reading: Rebranding: The Art of Reinventing Yourself Without Losing Yourself
It gets a little more complex with the so-called umbrella brand strategy (also known as Branded House). Here, the sub-brand serves as the connecting point between the released products and the corporate brand itself and is particularly relevant for companies with a very broad focus. The individual sub-brands generally appear on the market under the umbrella brand’s name but are still given a small addition that underscores their individuality as a sub-brand. This can be a name addition, a modified color, or a different typeface to signal to the consumer that a product is different, but still similar. For example, in the Sparkassen Group, you will always find a red “S” representing the umbrella brand, along with an additional name, city name, or area of specialization. This strategy primarily saves resources in communication, while the sub-brand benefits from the (hopefully) positive image of its umbrella brand and thus has a higher recognition value.
Next is the so-called Blended House strategy. Through organic growth, mergers, or acquisitions, it may be more sensible to leave an established brand as it is. “Never change a running system” is the motto here, as there is no need to change something that doesn’t need changing. For the consumer, a change in the brand can quickly lead to mistrust and confusion, even if they have been buying the same product for years and nothing has changed except the name and appearance. To avoid this, especially large companies with a broad range of offerings choose this path to benefit from the previous branding work of a brand. However, if a single brand fails, this doesn’t affect the umbrella brand and does not damage the image. Long-term, though, integration under the parent brand should be aimed for, as no one likes to be adorned with someone else’s laurels.
Finally, we have the Endorsed Brand strategy. A quick look in the cereal aisle of any supermarket shows you hundreds of products to choose from, which, in fact, all belong to the same umbrella brand. Due to their completely different appearances and messages, one would never guess, unless there is a small inscription (signature) that brings the individual products and their sub-brands back into the perception of the well-known umbrella brand. The big advantage is that different sub-brands can target very different audiences and even push this specialization within their own product range, while the positive associations of the parent brand signal stability and expertise behind it.
Even though many of these strategies are often generalized and pursued by larger corporations, their underlying principles are also highly relevant for smaller companies or individual brands.
Approaches to Developing a Brand Strategy
There are various approaches to developing an individual brand strategy, but they all have one thing in common: they are a process. That means, you consider some core points that are relevant to all brands, align them with the brand you want to develop, and continuously adapt to ongoing developments. Ask yourself first, what problem does your brand solve for your consumers or where does your added value for the consumer lie?
Additionally, a clear definition of your target audience is necessary. It is nearly impossible to develop a general strategy for every target group and every market, and if it does, it will never be as successful as a specialized strategy. The question of what makes your target group unique, what special problems they have, and how exactly they are to be solved is a crucial step in building a brand strategy.
This goes hand-in-hand with a precise definition of your brand values, from which it is clear what your brand stands for, what values it represents, and which consumers it targets. Over the years, a well-defined brand value also helps to not lose sight of your values and serves as a guide when launching a product or campaign.
Similarly, but distinct, is the core brand value. This positions your brand clearly and further strengthens its identity. This can be distilled from the most important brand values and makes it much easier for consumers to understand and identify with the brand due to its simplicity.
Of utmost importance in developing an effective strategy is the question of why. It is essential to be aware of a brand’s reason for existence (Brand Purpose). Especially in today’s world, consumers are increasingly distinguishing between brands that are just trying to maximize profits or those with a deeper purpose.
Besides the question of why a brand exists, the question of what goal the product is aiming to achieve is also important. The so-called Vision Statement answers this question and thus reflects the internal self-understanding of a brand externally. However, it is important to set such a goal within a time frame, or else it becomes too vague. Achieving world peace is an honorable goal, but is probably utopian and quickly sounds like empty rhetoric.
Finally, every brand should also be aware of its mission. This concretely means what added value a consumer or customer is promised when they use the product. This goes far beyond mere practical product promises. Of course, soap should clean, like all others on the supermarket shelf. But what else does the product promise? The brand mission considers the goals of the consumer and how it brings them closer to achieving them.
With Branding Agencies to a Successful Brand Strategy
After this excursion into the world of brand strategies, it quickly becomes clear that this is one of the most important, but also most complex topics in branding. One thing is unmistakably clear: without strategy, all measures for brand development are a waste of effort and a waste of resources. Especially the complexity of the matter makes the help of professional consulting indispensable and should, if it is to lead to success, be supported by the experts of a branding agency.