11 New Strategic Brand Management by Philip Kotler   4th Edition
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11 New Strategic Brand Management by Philip Kotler 4th Edition


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Bonne Maman jam, it is difficult to offer high-
definition plasma screens at low prices. There
are simply no suppliers in the high-tech
market to deliver such products. This is why at
the end of 2005 Carrefour decided to put an
end to First Line, and retained only its lowest-
price brand, BlueSky.
It is impossible to talk about brands without
touching on the question of innovation. In
fact, the function of the national brand, the
big brand, is to supply progress through inno-
vation, change, fashion, design and so on.
This requires marketing expertise \u2013 long-term
thinking on the expressed, or latent and
unconscious, expectations of future clients.
They also have the expertise of the major
industrialists. Thus in 2006, Fleury Michon, in
accordance with its brand charter, launched
hams without preservatives, since these are
the future, even if today\u2019s customer is not
aware of it. To be a brand is to be a leader, to
look far into the client\u2019s future. Eliminating
the chemical preservatives implies replacing
them with natural preservatives: it took three
years of R&D to find bouillons to carry out the
same preservative function. Some years previ-
ously, during the mad cow crisis, Fleury
Michon was able to innovate in offering ham
steaks. It is also the brand of turkey ham, and
other unusual products.
Does the distributor\u2019s brand also innovate?
No, since it does not have the means to do
so. Its business model assumes light
marketing \u2013 in order to reduce the costs
linked to the dozens of product heads \u2013and
the fact that it follows quickly in the wake of
what is already working, that is the innova-
tions of the successful manufacturers, by
copying them to within a few details. In fact,
the product specifications of subcontractors
tasked with manufacturing a distributor\u2019s
brand product are up to 80 per cent defined
by the characteristics of the successful
product to be imitated. If Henkel invents
tablets to replace washing powder, the DOB
must then manufacture identical tablets.
According to the stores, the remaining 20 per
cent of the specifications will be a way of
providing differentiation linked to the store\u2019s
own values. However, in order to be able to
appear quickly on the shelves with an iden-
tical offer at a 30 per cent lower price, it is
necessary to economise on marketing and
R&D: the distributor\u2019s brand business model
is that of copying, of imitation taken to the
maximum.
A common riposte is that distributors\u2019
brands were the first to introduce such and
such an innovation in terms of packaging: for
example, turning shampoo bottles upside
down, in accordance with their actual
position in the bathroom. However, the distri-
bution brand, by the very construction of its
economic model, does not seek to innovate:
its price is obtained through turning the
efforts and investments of the manufacturer\u2019s
brand to its advantage, profiting from its
strong position in the relationship, which
means that the manufacturer needs the store
far more than the store needs the manufac-
turer. Upon the launch of new food, hygiene
and maintenance products, the mass distri-
bution stores today request immediate access
to the same innovation for their own brand.
The examples most often given to prove
that distributor\u2019s brands can innovate are
Reflets de France and Escapades Gourmandes
(Gourmet Escapades). We know that this revo-
lutionary concept consists of revitalising the
production of 100 regional recipes, having
them produced by SMEs in these regions, and
bringing them together under the same
brand, sold in all the Carrefour Group\u2019s stores.
From this point of view, Reflets de France is a
true brand: an innovative concept, a target, a
price positioning maintained for all products,
a strong graphic identity, a high level of taste
quality and an imaginary quality (nostalgia).
FROM PR IVATE LABELS TO STORE BRANDS 71
This example shows that, when the
distributor behaves like a true brand, it opts
for own brands, or becomes the store of the
brand and not the brand of the store. For
example, Gap, which was the exclusive seller
of Levi\u2019s, began to introduce its DOB, and
progressively ceased to sell anything but its
own store brand products. However, it was
then necessary to clearly define a brand
concept, the store becoming the place where
the brand was expressed and experienced.
Gap defined the concept as anti-fashion.
Decathlon does the same. It is symptomatic
that in order to accentuate its status as a
designer/manufacturer with its own stores,
Decathlon gave up its store brand (there are
no longer any Decathlon products) in order to
organise everything under what it called
\u2018passion\u2019 brands: that is, a portfolio of private
labels. We present below this interesting case
of a distributor becoming a designer.
Consumer relationships with
distributors\u2019 brands
Let us now look at the question (are
distributor\u2019s brands truly brands?) from the
angle of the consumers themselves. For
consumers in mature countries, distributors\u2019
brands are perceived as genuine brands, with
their attributes of awareness and image always
combined with an attractive price.
When asked the classic awareness question
(\u2018What are the yoghurt or bicycle brands that
you know, even if only by name?\u2019), consumers
name Asda or Decathlon. When asked if they
intend to buy them (general client opinion) or
buy them again (behavioural loyalty), the
scores are just as high. It is no accident that on
the majority of mass-consumption shelves,
lowest-price products and distributors\u2019 brands
hold the dominant market share. Over time,
some distributors\u2019 brands are able to achieve
the typical brand effect, as shown by Table
4.1, which looks at the United Kingdom, for
many years a leader in this field. According to
the Brandz study, the consumer\u2019s proximity to
the brand moves from a feeling of presence
(awareness, recognition) to a feeling of rele-
vance (it\u2019s for me) to the perception of
performance and a clear advantage, and ulti-
mately to a genuine affective attachment. It is
interesting to note that two distributors\u2019
brands have made it into the top 10 of English
brands studied by Brandz: Marks & Spencer
and Boots.
We might say, of course, that there is an
affective transfer from the store to its
products, a halo effect. Boots and Marks &
Spencer are highly respected and historic
stores in the United Kingdom, having created
a relationship of reciprocal trust and esteem
with their clientele over time. However, this
halo effect is precisely the lever on which the
distributor\u2019s brand is counting.
Research carried out by one of our HEC
doctoral students on the sources of
engagement with the brand, depending on
whether it is a producer\u2019s or a distributor\u2019s
brand, throws brand-new and unprecedented
light on the matter. C Terrasse (Terrasse and
Kapferer, 2006) worked on four product cate-
gories, in order to compare engagement with
the Carrefour brand with that for the big
brand in the same category. Engagement with
the brand means more than repeat purchase.
Panel data has long shown that distributor
products obtain repeat purchase rates (behav-
ioural loyalty) as high as those of the big
brands, or even higher. The same is true for
engagement: the declared levels of
engagement are high in both cases, for both
DOBs and national brands.
Table 4.1 Brand attachment: the 10 winning
brands
1. Gillette 57 7. Nescafé 39
2. BT 56 8. Heinz 39
3. Pampers 53 9. Kellogg\u2019s 39
4. Marks & Spencer 42 10. Boots 37
5. McDonald\u2019s 42 11. Colgate 32
6. BBC 40 12. Royal Mail 32
Source: Brandz (UK).
72 WHY IS BRANDING SO STRATEGIC?
Engagement \u2013 personal involvement with
the brand \u2013 measures a strong relationship
with the brand, meaning that if the brand
were not there, the client would prefer to wait
than buy an alternative. For the consumer,
there is no substitutability.