BRAND VISION:Consensus among management, Vision Statement of a Fast Food Company, Glossary of terms

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Brand Management (MKT624)

Lesson 7

BRAND VISION

Purpose of brand vision

To earn the right level of profitability, you have to leverage your brand rightly. It is here that

we start treating brand as an asset and manage that asset by having a vision.

Vision fulfills three basic purposes1

· Consensus among management

· Commits company to research

· Mandates telling all stakeholders

Consensus among management: A bottom-up approach, it extracts understanding and

consensus from management about brand's contribution. All concerned with the brand give

their input regarding brand's potential and an effort is made to have all of them committed

to the respective tasks they are to perform toward brand's contribution.

Brand vision brings management to a platform from where they all have to agree what level

of growth the brand will generate to fulfill company's objectives. It is not a function limited

to the boundaries of marketing management; it is an objective for total management to

agree on one point brand's reason for being (why it exists?) and its potential toward

profitability.

The question of why the brand exists entails detailed discussion on many exciting areas of

marketing, which will be touched upon from time to time in their proper perspective

throughout the course. What it essentially means is the "fulfillment of a particular need" of

customers. Identifying the right need and then committing yourselves to fulfill that with the

right product takes you on the journey of starting with a vision to complete development of

the brand.

Commits Company to research: Consensus leads management to initiate research on so

many vital research projects. Because of the commitment, no one wants to make decisions

without any solid basis. The tendency to make assumptions on the ground that we know the

market well and therefore there is no need for research should be avoided. Only research

provides the company with grounds like:

o Customer attitudes and usage

o Brand attributes to maintain and change

o Segmental changes; multi-segment brands

o Geographical changes; new categories etc.

The list is not exhaustive. It can be much longer depending on the needs of the company at

any given point in time.

Knowing customers' attitudes offers insights into product build-up, service requirements,

and any other fulfillment of customers' requirements. Maintaining or changing product

attributes relate responding to changing needs, preferences, and competitive pressures that

exist and the ones that are anticipated.

You can also determine the differences among different offerings of the brand as perceived

by your consumers in different segments of the market. You can make decisions about

which segments are more attractive and which are less attractive. That may also take you

into what geographic areas to be emphasized more in relation to strength of different

offerings. Brand strength may lead the management to start considering introducing its

brand across categories. What is it that took Nestle from milk to yogurt to juices to

chocolates? This is a good example of going across categories.

Brand Management (MKT624)

Management can either stick to its vision and plans or change it according to the findings of

market research. As you go along the learning path you will realize that almost at every step

you can undertake a research project. Research does not have to be tedious, cumbersome,

and expensive. Small and simple research designs can lead you to verify your hypotheses as

the need emerges.

Mandates telling all stakeholders: Since vision is well thought-through and shared by all

in the company, it mandates that management tell all stakeholders to know and share it as

well. Sharing the vision means that stakeholders will also know the objectives that are a

reflection of the vision.

The present day's competitive pressures have made the day-to-day management very fast

paced and, hence, prone to dynamic changes and adjustments. Information on past

performance, recent trends, and research findings present a strong case for the brand plan

and vision. Having support from all stakeholders toward your brand objectives makes the

job of management less difficult. It also keeps the blame game and finger pointing from

taking place if things go wrong. Going right strengthens management's confidence.

Let us now try to develop hypothetical vision and mission statements of a fast food

company that is planning to enter the category of fast food. The exercise is intended to take

you through a case that offers an opportunity of developing a practical understanding of the

concepts.

After you feel comfortable with the learning process, you may like to develop similar

statements of any business you may envision yourself handling or heading.

Vision Statement of a Fast Food Company

"The company will enter the fast food category by introducing a range of quality

sandwiches with brand name XYZ; the sandwiches will have health-food-appeal for lunch

time in particular and anytime later in general. It will price the entries within the consumer

friendly range to optimize the number of customers, who are professionals within the age

bracket of 20-50 years. It will attempt to reach its potential customers at their door step and

always stay close to where they are".

As is clear from the statement, the company's business model will be based on three

fundamental factors of

· High quality

· Affordability

· Accessibility

The basic objective of this statement is to emphasize the point that vision relates the future.

The statement talks about the nature of the product and how it envisions entering the

category with consumer-friendly pricing within the target market. (The statement is a little

longer than the usual vision statements. It is designed to basically enhance your ability to

develop one independently).

We shall be referring to the implications of this statement frequently to see that every thing

said in the statement has a meaning in terms of brand management. The figures 10 - 12

exhibit the translation of consumer-friendly pricing as it fits into the market gap that will

allow the company to optimize its sales.

We can sum up the components of this statement into the following:

o It explains the overall goal of the brand

o It defines the target market

o It underlines the need to have differentiated sandwiches

o It makes it easy to translate the above three components into financial goals

Brand Management (MKT624)

If you think that XYZ has to create more than one sandwich with different taste profiles in

order for its customers to have choice, then your thinking is practical. If you think that XYZ

should deliver sandwiches at the doorstep of its customers, then your understanding is

correct. And, if you think that XYZ by saying "close to where its customers are" should

also create its own restaurants, then your vision is comprehensive about the future business

make-up. Should you also think that the statement will have implications in terms of

specialist personnel to operate restaurants; your vision is then absolute and totally inclusive

about the nature of business.

Mission being the business at hand, the statement will look like the following:

Mission statement of XYZ

"XYZ's mission is to develop a team of delivery personnel conversant with the job of

delivering food with high efficiency and low operational costs. Part of its mission is also to

simultaneously develop fast food outlets with appealing but economy-driven architectural

features, from where it can serve its customers through highly-trained and motivated crew."

We are assuming that XYZ has in place all requirements fulfilled for the right human

resource for sandwich making and purchasing on daily basis of the requisite supplies.

Sustaining the operations through excellent systems and procedures are part of the

development process.

Brand Value Statement

"XYZ professes integrity of character, conscientiousness of work ethics, quality

consciousness, and mastery of skills as its basic values."

To have the quality of sandwiches as envisioned by XYZ, it is important to have the staff

inculcate the declared values. It should take special training sessions and periodic refresher

meetings to renew company's commitment to the professed values.

Brand Management (MKT624)

Figure 10 above

Figure 11 below

Brand Management (MKT624)

Figure 12

The three figures show a grid representing on the x-axis five segments of price and on y-axis

three levels of quality. The intersection of the price line and the quality line represents one

particular price-quality index that basically defines one particular segment. You can have as

many price lines as you may deem representing the actual market situation.

XYZ makes an entry in "mid-high market segment 4" (figure 10) and later plans to enter with

different offerings into "mid-market segment 3" (figure 11) and "high-market segment 5"

(figure 12) later on. The strategic moves are a translation of the vision the company developed

for itself. Workings on the moves as are evident from the figures are all about company's

mission and strategies that flow out of the vision and mission.

Key point

Vision generally represents a time frame of 5 to 10 years. Once translated into mission, it stays

intact for a couple of years or more. It is said that a mission statement should not be changed

before two to three years approximately.

Brand Management (MKT624)

Glossary of terms:

Contribution: Contribution margin is the gross proceeds after deducting the direct variable

costs a company incurs on making a product. The higher the contribution, the greater the

potential the brand has to lift the business toward the breakeven point.

Brand attributes: Features of the brand that characterizes brand's personality.

Offerings: An introduction of a product, or a product; generally, it is used owing to brand

extensions. If a brand has more than one extension, for example regular yogurt and the one

with higher calcium, then the brand has two offerings.

Stakeholders: All those individuals and entities that have stakes in the business. They may not

be shareholders, but they are affected by the performance of the company in one way or the

other, for example banks and suppliers of raw materials.

Business model: The strategic frame work on which rests business' strategic moves.

Bibliography:

1. Scot M. Davis: "Brand Asset Management Driving Profitable Growth through Your

Brands"; Jossey-Bass, A Wiley Imprint (38-39)

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