Building a successful global beer brand – part 6
Having illustrated the perils of failing to create a unique proposition with your brand, Kos Apostolatos, David Atkinson and Joseph Poore from management consultancy firm Marakon, examine the third step to success.
Step 3: Make space for your brand by repositioning your portfolio and build a detailed strategic plan
We discovered that companies that build global brands are able to reposition their portfolios effectively to foster new growth.
This involves being clear on the value proposition of each brand, understanding where your global brand fits in the local portfolio and then creating a clear space in the consumers mind for it by repositioning existing brands.
Harbin, a brewer in the northeast of China, was acquired by AB InBev in 2004. It had an extensive portfolio of local and regional brands, and through Harbin’s distribution network, AB InBev planned to launch its own brands, including Budweiser and Beck’s.
Before launching, the AB InBev team conducted a simple consumer mapping analysis. Out of Harbin’s portfolio of approximately 100 brands, 30 were found to be unnecessary or overlapping and easily substitutable with different brands in the portfolio.
These were generally money-losing brands and were either removed or their SKUs consolidated, and a clear space was created for both Beck’s and Bud in the brewer’s portfolio.
The topic of portfolio rationalisation has always been a taboo in the industry. We have seen select brewers like AB InBev pursue this strategy with great effect, but the complexity of brand portfolios and consumer preferences in some markets implies higher execution risk, so it is not for all companies.
We expect this to change slowly as the push toward global brands and hiring consumer goods talent in beer companies continues.
Building a strategic plan for your brand
Having reflected on where to position your brand within your portfolio, it is critical to go through a detailed exercise of strategic planning for your brand.
This exercise needs to cover the following key points:
- Definition of winning: what is the brand ambition, what are the objectives and key milestones over time
- Where to win: elaboration of accessible headroom in key target markets and channels
- How to win: reiteration of consumer positioning and unique value proposition (e.g. who is the consumer, role, functional/emotional benefits of the brand to the consumer, brand personality), key components of the business model and how they may vary across key markets (e.g. marketing mix strategy: communication, activation, innovation, pricing, route-to-market strategy, etc.)
- Exercise 3: Create space for your new brand by repositioning your portfolio.
- Build a local consumer map with the same axis as your global consumer map.
- Place your global brand onto your local consumer map.
- Reposition the local brands that are currently overlapping with your global brand.
- Place your competitor brands onto the consumer map and assess the overlap; do you need to change your strategy to take share from your competitors?
- Develop the strategic plan for your brand.