3 Franchise brand system: Organisations such as Benetton and Burger
King are franchise operations. Benetton, it contracts out parts of its
manufacturing activities. Key skills relating to core aspects of the
brand’s quality, such as pattern cutting and dying operations are how-
ever kept in-house. Warehousing is also kept inside the company oper-
ations and is an area were considerable investment has been made to
allow fast distribution around the globe. The retail outlet are mainly
franchise operations. Although these retail outlets are one of the most
visible aspects of the brand this is not a core area of competence owned
by the organisation. Key competencies lie in the areas of product design,
brand development, management of key areas of production and distri-
bution, supplier and retail franchise management.
4 Manufacturers private label brand system: Some companies concentrate on
manufacturing products to be sold under a retailer’s own label such as
Marks & Spencer. These companies have no control over branding or
the retail outlets instead they create their competitive position through
highly efficient manufacturing skills, customer service and new prod-
uct development abilities. There are examples of organisations, such as
Weetabix, producing both their own branded products and goods for
retailer’s own brands.
Optimising the assets and competencies available to an organisation is
obviously a crucial step in creating appropriate operational systems to
support a brand.
■ Brand name strategy
The operational structure an organisation develops is not the only area of
strategic decision making associated with brand management. An organ-
isation also has to decide its policy for naming brands across all its prod-
ucts and services. Branding decisions for any new products can then be
taken within this framework. The focal point of decisions on branding
strategy is about the emphasis the organisation wishes to place on creat-
ing a distinctive offering in the market against the weight it wishes to
place on the origin of the product or service (see Figure 9.12).
Between the extremes offered by these two approaches lie several options
available to an organisation when considering an overall brand strategy:
● Corporate brand: Organisations following this approach, use one cor-
porate name across all its products. Heinz would be a classic example
of this unified approach. Individual products merely carry a descriptive
name under the corporate umbrella Heinz brand, hence Heinz Baked
Beans, Heinz Cream of Mushroom Soup, Heinz Tomato Ketchup.
Linking the individual products together creates a strong overall image.
It also gives the opportunity to create economies of scale to be developed
in marketing communication and possibly distribution. The clear danger
is that if there is a problem with an individual product the reputation of
Targeting, positioning and brand strategy 201