Strategic Marketing: Planning and Control, Third Edition

Alternative options for the structure/ownership of key capabilities necessary to support successful

brands

Type of brand Finance Brand Product Production Distribution Retailing

marketing system development development

Manufacturers

own brand system

Retailers own

brand system

Franchise brand

system

Manufacturers

private label

brand system

Organisations have tended to use one of four main options in structur-

ing their operations to gain access to the assets and competencies they

require:

1 Manufacturers brand system: Companies such as Kellogg only produce

products under their own brand name. Kellogg owns the majority of

the business operations except for the retail outlets selling the product.

In some areas third party distribution systems may be utilised.

2 Retailers own brand system: Retailers such as The Gap or Marks & Spencer

only supply goods carrying their retail brand name. Manufacturers

under contract to the retailer carry out production. Often distribution is

contracted out. Product development is sometimes undertaken by a

third party, such as a design agency, but more frequently it is a shared

activity with the retailer taking an active role.

200 Strategic Marketing: Planning and Control

Shaded boxes represent areas of the business fully or partly handled by a third party

Figure 9.11
Alternative options for the structure/ownership of key capabilities necessary to support
successful brands (Source: Adapted from Davidson, 1997)