Revisión de la literatura

A strong brand is a valuable asset and its management should include proper positioning along with visual presentation of the brand image through the trade mark and trade dress. A trade dress of the brand is its nomenclature symbol style and colours put together on the product package. The trade dress of the brand needs to be registered to protect imitations.

Brand equity consists of the strength of the brand along with the brand presentation strategy and its association with the user groups and is largely reflected in the market behaviour comprising market share, price, perceived quality, distribution efficiency, and consumer loyalty and promotion strategy. Brand leveraging may be defined as an exercise using an existing brand mane to enter a new product category. Brand leveraging is potentially very attractive. It makes use of the existing consumer awareness, good will and loyalty. Such exercise of brand positioning is cost effective and reflects greater emphasis on brand. The

22 See details in Chapter III under Product

23 Tauber, Edward M: Brand Leverage: Strategy for Growth in a Cost-control World, Journal of Advertising Research, August-September, 1998.

Procter and Gamble adopted a brand leveraging strategy in the introduction of its sanitary hygiene product Always. The P&G adopted similar strategy for introducing the liquid detergent Tide as a new category of product. In order to implement an effective brand strategy it is necessary to identify an appropriate category of branding. Multinational companies in a competitive environment adopt the following brand strategies:

• Specific product branding

• Product line branding

• Corporate branding

• Combination branding

• Private branding

The brand leveraging strategy of a company may be adapted through extending the product line category. The new product line can be formed by stretching it to cater the mass or class market consumers. Sometime the companies prefer to form a new product line instead of stretching the existing product line vertically or horizontally. The co-branding or brand hiring strategies also provide brand leverage which may give opportunities for more franchising and better sales promotion of the products and services. Whenever a new product line of the company it should be decided whether to create a new brand name or use an existing name.

Mary Kay Inc. operates on the Go-Give philosophy²⁴ and has built its brand value on personality traits of consumers and employees. All you send into the lives of others does come back into your own. All Consultants and Sales Directors share experience and guidance with new team members until each reaches her potential. When illness or emergency keeps someone from a scheduled skin-care class, it is not unusual to have a some help from others. "In business for yourself but not alone," is a Mary Kay Ash philosophy that guides the independent sales force. Mary Kay skin care is taught, not sold.

Rather than approach customers with "dollar signs in their eyes," Consultants operate with the goal of helping women achieve positive self-image and of leaving the customer feeling better about herself. Mary Kay Ash said, "Ours is a business where selling results from a truly one-on-one personal relationship." According to Mary Kay, a career is not considered an end in itself, but a means to an end; to personal fulfillment, family comfort and harmony; to a balanced life; to self-expression. Hence the business philosophy of Mary Kay Inc. has been centered on the religion that reveals “God is first, family second and third is the career.” Hence, relevance and excellence of the brand has grown on human sensitivity and brand has been architected on non-competitive grounds.

National brands are identified as long standing brands in the competitive markets having wide spread distribution over the spatial and temporal market segments. The national brands are not very sensitive to the price gaps and the private labels. When a firm markets another brand in the existing category and protects its market positioning, the product is defined as flanker brand. The flanker brand is also known as fighting brand. Such brand has low investment on advertising and the product is offered on cost price. The American Express

24 For details on the corporate philosophy of Mary K ay Ash see Hilary Weston : Mary Kay Cosmetics-Sales Force Incentives, Harvard Business School, Harvard, October 1999 (Ref 9-190-103)

sells its premium priced products as green, gold and platinum credit cards and the card named as Optima was brought to the market by the company as a fighting brand. Such brands outwit the competing brands in a cost effective way. Private brands are more sensitive to the personal income and most of the retail stores set such brands for selling their grocery and consumer goods. The store based private labels or brands offer a number of advantages with high margins.

Roche is a pharmaceutical research, technology and market-driven company, whose unique portfolio of products and services creates superior value for the customers. The products of the company are delivered through its affiliates located all over the world.

Affiliates or regional representations are direct link to the customers and local markets of the company. Roche Diagnostics integrates its own know-how with that of selected partners from a wide range of specialized areas. With this objective in mind, Roche Diagnostic’s strategic alliances and collaborative partnerships are aimed at combining potential with an innovative and ambitious approach. Best known examples of successful and long lasting partnerships are the global alliances with Hitachi (since 1978) for clinical chemistry and immunoassay systems, with Sysmex (since 1998) for hematology systems and with Stago (since 1973) in selected countries for coagulation systems. Roche Centralized Diagnostics (formerly Roche Laboratory Systems) directs its products and services at private labs, laboratory associations and central hospital laboratories, offering high-performance analysis systems to measure hundreds of different parameters in clinical specimens as well as programs to optimize lab processes, from sample down to result management. In cooperation with its partners Hitachi, Sysmex and Stago, Roche Centralized Diagnostics offers a full line of solutions for laboratories of all workloads. Roche Centralized Diagnostics’ ultimate goal is to improve patients’ health through the application of modern laboratory diagnostics as an integrated part of health management systems. In another alliance, Roche-Syntex Mexico is engaged in selling the diagnostic reagents and equipments to the government and private clinics. The company also provides the diagnostic equipments to these health institutions and hospitals on lease. The business environment of the diagnostic market in Mexico is highly competitive and distributor oriented. The laboratory diagnostics-supplier base in Mexico is confined to the selected suppliers dominating 80% of the total market²⁵.

Branding strategy is also developed in accordance to the life cycle performance of the products and services. Many large companies consider different branding strategies at different levels of product life cycle - introductory, growth, mature and decline. Companies develop the brand in the introductory stage with an objective to establish the market position on the basis of quality, price, and application and consumer preference. Bbrand promotion needs more investment at this stage to build awareness and pull effect with the distribution channels and consumers. Effective brand building is necessary to introduce the product in the distribution network at the skimming price. In the second stage of the product life cycle which emphasizes growth of the product in the given market environment, the brand needs to be reinforced with a focus on expanding the consumer segment. In the process, the weaknesses of the product from the point of view preferences of consumers and distributors need to be identified.

25 Rajagopal (2003), Sales Force Re-organization for Maintaining Profitable Growth: A Case of Roche Diagnostics Mexico (A), Discussion case, ITESM, Mexico City Campus, 1-19

The rise in consumer health awareness is driving innovation in the global cosmetics and toiletries industry over the last five years, consumer health awareness has increased significantly around the world due to a growing focus on health issues in the media and an increasing investment in health initiatives on the part of governments, according to the research from Euromonitor International. While it is clear that increasing consumer concerns for health and wellness have obvious repercussions for markets such as packaged food and Over-The-Counter (OTC) healthcare, the study has also found that it has become an increasingly influential factor in the cosmetics and toiletries market. Things went a step further last year when L’Oréal and Procter & Gamble forged joint ventures with Nestlé and Pharmavite respectively to expand into OTC dietary supplements, encouraged by trends indicating that consumers are increasingly keen to co-ordinate health regimens with beauty practices. The Nestlé/L’Oréal joint venture heralded the launch of Innéov Fermeté (an anti-ageing formula), while Procter & Gamble and Pharmavite jointly launched Olay Vitamins.

More recently roles were reversed somewhat as Healthspan, a Guernsey-based mail order vitamin supplier for the UK market, launched a dedicated range of make-up and skin care products which target women aged between 45 and 60. The research shows that the trend is widespread in the US market, as US consumers are becoming increasingly convinced that beauty starts with "wellness". Retailers are increasingly linking their beauty lines to non-beauty products, positioning health products, like vitamins, in close proximity to cosmetics.

Manufacturers are introducing cosmetic lines in OTC segment, like Sally Hansen’s Healing Beauty Fast and Flawless make-up line, with products featuring anti-wrinkling and acne-fighting ingredients. The market is clearly strong for cosmetics and toiletries products that associate themselves with wellness, with many lines now routinely infused with vitamins and increasingly with natural and herbal extracts²⁶.

The maturity stage of the product requires repositioning of the brand with an objective to secure the new market segments. Marketing-mix strategies pertaining to product, promotion, place and price need to be developed accordingly by adjusting the product features, improve communication, comprehensive distribution and offering good price deals to the channels. At the stage of decline, the brand needs to be redesigned with a view to prepare the product for re-entering in the market. The physical and applied properties of the product need to be improved and re-launched with better consumer awareness approaches at the point of purchase and demonstration levels. The distributors of the product may be reoriented towards the competitive advantages. Simultaneously, the efforts have to be made to clear the stocks of the old product well before the redesigned version of the product is formally launched in the market. There is considerable evidence of the shortening of the product and brand life cycle.

To some extent, this is a factor of the intense competition in the marketplace which means that new products have to prove themselves very quickly or delete. It has been observed that the launch of products that is promoted as limited editions and is designed for a short shelf life. This is particularly important in the impulse market where new product development and associated promotional activity are crucial in driving visibility at point-of-sale. Short life-cycle products will also require quick payback. Successful brands of this sort will make profits and then disappear or be quickly updated and reinvented.

26Leonie Tait : Increasing interest in health and wellness drives innovation in cosmetics and toiletries, Euromonitor International, 11 January 2005. Web site: www.euromonitor.com