Acquisitions. Mergers. Divestments. Joint-Ventures. Partnerships. Business unit expansion. Business unit consolidation. Positioning and repositioning...
...at some stage during any one of these key corporate events the issue (or is it ‘spectre’?) of ‘brand architecture’ usually raises its head. Which strategy to pursue? Monolithic? Endorsed (heavy, or light)? Stand-alone / ‘House of brands’? What’s the optimum structure? Is that even possible? How should it be expressed, visualised and managed? What are the respective roles and positionings between the constituent entities?
In many cases, companies don’t think about their architecture needs until a
problem arises. Frequently this is driven by acquisition, when either the number of branded subsidiaries hits a certain critical mass, or there is a realisation (either via a strategic review, or new appointment) that the situation is already out of control... with brands, sub-brands, marks and identities appearing in many and varied iterations. The situation becomes even more complex with cross-country acquisitions where the added dimension of cultural ‘sensitivities’ come into play.
In the majority of situations, the challenge is less to do with creating an ‘ideal’ structure from a blank sheet of paper (unless you’re a start-up), and more about approaching it from a position of reality, where sub-brands already exist in various forms and numbers. The more difficult scenario.
So what do you need to do to extract greater value from that portfolio? How do you bring greater structure and order to a situation that, at best, can appear confusing; at worst, spiralling out of control?
The first stage is almost always to review the over-arching ‘Masterbrand’, its market positioning and proposition, ‘vision & values’, competitive strengths, image and reputation. This provides the benchmark; clarifying whether there is a need to address initially any positioning / image / identity issues at the level of the Group parent and determining how best it can support an optimum brand hierarchy.
Once completed, the specifics surrounding the portfolio and brand structure itself can be addressed. Here, the focus will usually be on:
In both instances, this type of exercise will provide the framework from which to build, or reshape, the overall group / brand structure. This can range from:
a centralised, monolithic structure, in which the Group / parent ‘Masterbrand’ is dominant and visually omnipresent... to a diversified hierarchy, where subsidiaries have their own identities and ‘freedom’.
Nor do these have to be executed in a single, defining corporate ‘event’, as it’s perfectly possible to transition from one structure to another, over time. Vodafone famously proved this with its ‘brand migration’ strategy, converting its acquired national telco brands into the main global parent identity over periods that ranged from months to several years, depending upon local circumstances.
Yet each strategy has its own specific challenges. With a ‘monolithic’, single-brand approach, while it may appear simple and cost-effective, there are many issues around converting existing brands into such a streamlined entity, as well as managing joint ventures and partner branding - as, by its very nature, it is not a ‘sharing’, nor ‘co-existing’ strategy.
This is something we had to address for Balfour Beatty: defining and creating
a comprehensive set of guidelines for the Group parent, as well as its individual Operating Company brands and complex joint ventures / co-brand relationships. The challenge was not only to define these constructs conceptually, but also create a structure that could be consistently replicated within that framework. A particular feature of which was its ability to ‘flex’ in order to accommodate differing levels and type of need.
Most recently, we’ve extended this system and been working with Group to help convert (‘transition’) a number of individually branded and named OpCo’s into the main Balfour Beatty parent entity.
In the case of diversified, or ‘branded’ groups, the challenge is not just one of creating the actual (more complex) architecture, but also establishing the optimum degree of parental endorsement and balance with the brands themselves.
Our Go-Ahead Group client is a good example, for whom we created a cohesive framework that allowed its seventeen autonomous operating companies to have freedom, whilst also fitting into a structure that established a consistent Group ‘foot-print’ that could be applied across all forms of communication.
But beyond identity structures, visual endorsements and design guidelines, the real challenge is to ‘win hearts and minds’... either to remove concerns within the acquired companies over a perceived loss of brand sovereignty, or market focus. Or at the other extreme, to limit too great a sense of independence, or the creation of ‘silo mentalities’.
Key to success is the ability to manage perceptions and prejudices (sometimes entrenched) that existing subsidiary / sub-brand owners and managers may have.
Close involvement and engagement in the evaluation of the options under consider- ation always helps; as does the sensitive communication of the evolving ‘parental’ strategy and its rationale, along with a clear articulation of the ‘reasons why’ for a particular decision... however pleasing, or painful to the incumbent manager. This is where internal and external research can be invaluable, engaging staff (and external audiences) in the process and providing qualitative and quantitative interrogation and substantiation of the various strategies under consideration.
In the final analysis there are two requirements. The first is that any architecture must provide a clear framework; although not necessarily a rigid, inflexible straitjacket that will either antagonise, or earn only tacit adherence. The second is to focus on engaging with all sub-brand ‘owners’ and management; to bring them into the process, so that full assimilation and an open commitment to the strategy is achieved.
This ultimately will ensure that the real value of the chosen architecture will be realised and the optimum model adopted. Perhaps, once again proving that old adage... that the process itself is a key part of the end solution.
It is perfectly possible to transition from one structure to another, over time