“Catching the Wave”: Brand Management in Times of Social Change

24 Jan 2011|Added Value

On the 26th of November 2010, our colleagues at Icon Added Value held the 18th annual Congress in Nuremburg, Germany. The topics covered at this year’s event provided inspiration for attendees on many of the key areas of strategic brand management and development.

The range of presentations was broad: Commerzbank brought to the stage one of the most exiting financial sector brand-stories of the past year, while Thomas Cook provided insight into the challenges of the tourism sector after the financial crisis and amidst radical social change.

In addition, Homann presented thinking on best practice in successful brand expansion in the highly competitive delicatessen market. And Christoph Prox, Icon Added Value’s CEO, offered a look into brand management in 2020 and the influence of new media on brand development.

The only downside for the 370 or so participants was that Dr Frank Schirrmacher, key note speaker and author of the highly successful book, Payback, fell victim to the Eurowings strike – which left him stranded in Berlin and unable to present.  But the always engaging compare, TV anchorman, Jan Hofer, kept the audience entertained and facilitated robust and interesting Q&A sessions following each talk.

The 18th Annual Icon Added Value Congress:
Here is an overview of what was on offer this year.  For more information on these, and previous Congress presentations, contact Anne-Kathrin Kirchhof.

Uwe Hellmann

One Name. One Icon. One Bank. – The New Commerzbank Brand
At the end of 2008 Germany saw the merger of two traditional financial brands, Dresdner Bank and Commerzbank. The resulting Commerzbank brand manages to combines the best of both under a new proposition. Uwe Hellmann, Director of Brand Management for the new brand, shared insight into how the merger was orchestrated and how both brands managed to integrate into one.

The circumstances surrounding the merger were difficult said Hellmann; the financial crisis was at its peak. Security and trust, rather than high returns, were becoming increasingly important for bank clients. In addition, the Commerzbank profile was not strong among consumers. In response, and in collaboration with Icon Added Value, the new Commerzbank developed its strategic positioning as “Hausbank for Germany” (household bank of Germany). Partnership and Performance were identified as being central to the new brand, communicated in a new slogan “Achieving more together”.

The look for the brand was also revised; the new logo combined the iconic Dresdner Bank band with the yellow colour of Commerzbank.  And the team developed a communications campaign to further develop the positioning.

Success followed shortly: soon after initiating the campaign, awareness of Commerzbank increased and the brand gained sympathy and trust among consumers.

Hellmann concluded his presentation with the opinion that a strong team is critical to this kind of brand integration and gave a nod to the team that developed from the merger of the two banks.

Jürgen Breitinger

Vitamins for Healthy Brands in Financial Services
Jürgen Breitinger, Managing Director of Icon Added Value, used the analogy of vitamin therapy to talk about how financial services brands could improve their value in a rapidly changing marketplace.

Beginning with Vitamin A, Breitinger talked about financial services brands having the opportunity to create a new, modern staging for engaging with consumers: post the crisis, they can really differentiate themselves with qualities like partnership, care and equality. These qualities are particularly relevant to consumers and are mostly likely to generate preference.

Breitinger moved on to Vitamin B: the trend in financial services is towards less loyalty from consumers, largely because advances in technology enable consumers to be far more fluid in choosing financial services. For financial service providers it is more and more important to define the right point in time to connect with consumers, to improve the response to a differentiated brand promise.  Studies have shown that while the messaging and channel might be right, financial service communication (whether marketing or sales) is not connecting with consumers.  In addition, sales are more often than not now “self-initiated” by the consumers rather than coming from the sales department.  The challenge for financial services brands will be to respond to this far more flexible and dynamic sales environment.

The section Vitamin C explored the need for more expressive brands.  While more generic qualities play an important part in a healthy financial services brand, a “strong brand character” can provide the right inspiration to connect with consumers and really set a brand apart.

Breitinger’s summarised his point of view by saying that financial service providers will be well-equipped for today’s market conditions if they are established at the right time and at the right place, with a credible message and clear character.

Gisela Sökeland

Thomas Cook: “Market Potential and Brand Segmentation”
In her presentation, Gisela Sökeland, member of the supervisory board of Thomas Cook AG, illustrated the challenges in developing brands in the travel industry.  Existing social, political, economical and technical factors have influenced supply, as well as demand within the tourism sector, and have initiated a change in the market.

Future social trends, such as the “Generation 50+” – which shows that by 2030 almost every second German will be over 50 years old – means that the individual profile of consumers in this target group, in terms of occupation, health and attitude to life, will have a direct impact on their holiday choices.

Additionally, the increasing number of singles and holiday singles – which require a diversification in holiday entertainment – will also have to be considered.  All of this must be taken into account by tour operators, who need to understand the market in all its complexity.

Sökeland noted too that sales channels are also changing; the online environment is fast becoming the channel of choice for both gathering information and for bookings.

Dynamic and same-day reservation systems pose another challenge for travel agents. The market segmentation has shown that the tourism market spans across the functional and emotional needs of the client. The detailed description of client groups, as well as the identification of how brands make consumers feel, made it possible for Thomas Cook AG to define and prioritise segments of the brand’s target groups.

Sökeland’s conclusion: with a strong market segmentation, Thomas Cook and Neckermann Travel have been able to gain the edge in the market.  The differentiation between the two brands has further been optimised, particularly in terms of recommendations regarding product and brand value positioning.

In addition, core target groups have been identified and target-specific marketing efforts created, which will be essential in building future market share.

Dr Hildegard Keller-Kern talks to Jan Hofer

Impulses for Growth through Market Mapping
Dr Hildegard Keller-Kern, Icon Added Value Management Board Member, shared her point of view on market segmentation.

As a result of the financial crisis, consumers are experiencing a sense of uncertainty.  Their expectations of businesses have changed to become more demanding, particularly in the field Corporate Social Responsibility (CSR).  And if people’s attitudes change, they make decisions accordingly; specifically in terms of consumption and brands – which means markets tend to change.

Changes bring opportunity for growth and Keller-Kern suggests that it is time to take advantage of these new opportunities.  To look at people, brands and markets with ”fresh eyes” and to identify the potential for growth and how this could contribute to the Brand Portfolio Management, Brand Positioning and Innovation areas of a business.

However, different segments of the market react differently and uniform segmentation approaches often fall short. Keller-Kern said it is vital to look at the markets in brand-specific terms, and to segment according to the most important decision-making criteria. A clear and comprehensible segmentation has a much better chance of finding its way into the daily routine of marketing- and sales-teams and thus are more likely to be implemented successfully.

Martin Thörner

HOOOMANNOMANN – Lighting up Brands. How to Develop the Delicacies Market
According to Martin Thörner, Managing Director at Homann, the Homann brand is the market leader of delicatessen salads. Originally a margarine brand, Homann launched a completely new concept that began with ready-made potato salads in the 1950s, and developed into a market leading success-story thought the broadening of its range.

The market of delicatessen salads was still fragmented in 1995; there were no real brands and trade brands did not have faith in the niche. Homann succeeded in building its market share and image with the help of promotions, a new packaging system and numerous other innovations.

In addition, trade brands started to get involved and market volume increased significantly. Homann reacted early and took over the production from some discount traders.

A further engine of growth was the use of Homann’s classic communication which used nationally recognised comedienne, Barbara Schöneberger to provide testimonials in TV advertisements.  Consumers responded well to the endorsement, and brand awareness increased.

In 2010, the acquisition of Homann’s strongest competitor, Nadler, was finalised, signaling continued future growth for the brand. Thörner confidently predicts that Homann will continue to shape the market in the future.

Christoph Prox

Brand Management 2020
Christoph Prox, Icon Added Value CEO, opened his presentation with a short film reflecting on the last ten years of internet usage and the rise of Web 2.0.

The piece was supported with some interesting new media statistics – particularly looking at social networks – clearly illustrating the omnipresence of new media.

Prox suggested that the future will be characterised by digital diversity. The changing use of media will also change the perceptions of brands. A new kind of interaction and communication between consumers and brands mean that companies have lost some of their control over brand management.

Prox’s view is that new media will hold different relevance for different industries and sees two dimensions as being significant to how brands engage in the new environment: Involvement and Explanation. Depending on the characteristics, he recommended two strategies: “Help & Engage” or “Stand out & Connect”.

He noted, however, that it is still critical in all cases to provide people with relevant benefits. Regardless of industry or size of the company, these five measures were proposed for brands engaging online:

  1. Establish a response team.
  2. Make sure your rate of impact fits the new world – but don’t become action heroes.
  3. Live your brand within the company.
  4. Use the innovative power of the Internet.
  5. Develop branding strategies for your Point of Sales.

Prox’s full presentation can be obtained at no cost from info@icon-added-value.com

Press contact:
Anne-Kathrin Kirchhof
Head of Corporate Communications
anne-kathrin.kirchhof@icon-added-value.com

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