 Assalamu alaikum khawafatuhu, Huzrat. Wasim Hassan welcomes you to the virtual University of Pakistan. We are getting into lecture 44 of brand management, MKT 624. The area that we are discussing here is brand planning. Brand planning has the three distinct steps that I started talking about in the previous lecture. I was done with the first fund which relates corporate strategy and brands, which is all about the treatment that the brands must get at the top most level of the corporations. I was talking about the second part of the planning process when the time ran out. That particular part is the brand planning itself. Market analysis is the topic within that area that I was talking about and under that subject. It is the drivers of change that were at hand in the previous lecture. So let us continue from where I left. There are different forces of change and the dominant forces which cause changes in your market makeup and the competitive adjustments are the ones I started talking about in the previous lecture. The two dominant forces that I talked about were the change in the long-term growth of the industry, meaning an upward change or a downward change. The second dominant force which really affects companies is the change in use of the product, meaning who your customers are and what is the change in the use, meaning the way they use the product. What is it that really causes that change? Meaning if we have a dominant driving force under that force, what really is it that becomes the driver? The third dominant force which really forces companies to bring about changes in their competitive behavior, the reason I call competitive behavior or competitive adjustments because we all are part of the market and we all are the players within the market and since we are pitted against one another, we are competitive in nature. So whatever moves that we undertake are known as competitive moves. So let us look at the competitive adjustments which are caused by these dominant forces. Product innovation is another dominant force which brings about changes and this is a dominant force which is basically created by the manufacturers. What happens is that there are industries in which the manufacturers are so innovative because of the market pressures, meaning the competitive pressures and because of the technical expertise they have at their disposal that they keep on innovating their products at a ferocious pace and because of that what happens is the markets grow faster, industry grows faster and the level of differentiation gets wider and wider and because of these factors the net result is that the perception of the consumer gets reformed. So when you are part of an industry which is growing fast, I mean the market is growing and the manufacturers also are growing and you happen to be one of the suppliers to one of those manufacturers, you have got to take into consideration all the competitive adjustments in relation to your own posture. This is just a hypothetical situation. You also could be one of the manufacturers that are part of the group causing that force which is translating into so many changes within the industry. The factor means that you have got to be mindful and very sensitive to all the changes and the dominant forces which have the potential to bring any changes that may require adjustments on your part. Another dominant force that we should talk about is the market innovations. Market innovations take place in the form of a newer kind of delivery and marketing people get into creative methods of distribution only to improve their costs and improve the relationship between the product and the customers and to make the product more customer friendly, so to say. And when that happens it really changes the whole landscape of the market. If you think that something of that sort is taking place within the market that you are a part of, you have got to take that into very serious consideration. If you think that somebody has been very ingenious and the actions on the part of that particular manufacturer have not really translated into heavy impacts then you may ignore it for the time being but any competitive adjustments which you think they should be brought about have to be brought about in response to the changes which are taking place in the market. Be very alert all the time. Another dominant force that you must consider during your planning process is the entry or exit of firms. You are part of an industry which is peaceful in the sense that it is steady in its growth and the number of players is well established and all of a sudden what happens is a foreign company with a lot of resource that enters your market and creates the first of all ripples which get translated into something really drastic and very cataclysmic. When that happens it really affects the cost structures and the marketing structures within that particular market because in most of the cases big companies have the potential to bring costs down and that is the one thing which really makes them big. In that situation you have got to study your market and the moves on part of your the competitors very carefully because all the competitive adjustments that are to be made are going to form the basis of your future movements and therefore any major impacts have to be taken into very serious considerations. So by the same token if due to certain reasons one player or a couple of players within the market are exiting due to the very pressing the dominant forces and they just cannot sustain themselves. Again you have got to make certain competitive adjustments. You may also have to face the burnt of the situation just like they have faced or that may provide you with the kind of an opportunity to fill the gap whatever gap that is it could be kind of a narrow dwindling gap because of the declining market in that situation but whatever the situation may be if you think you can capitalize on that situation you have got to make the competitive adjustments accordingly and craft your strategic moves or the executions accordingly. Another example could be that of a manufacturer from a different category altogether meaning a manufacturer who is operating in a different category but is very resourceful and tempted by the growth of your market he decides to become a part of that and having a lot of brand power in his original market he jumps into yours causing a lot of changes. You have got to take into those drivers into consideration if the intrigue of this kind of resourceful player really changes the rules of the game. The strengths that you have have got to be exploited the weaknesses that you may have have got to be eradicated and so on and so forth. The strategic process has got to be considered accordingly. Another change meaning the driving force that really changes the market and necessitates the competitive adjustments is the change of lifestyle. Let's take the example of the anti-smoking campaign all over the world and you will know what this really means. This driver of change has really got to be brought about the drastic adjustments within the strategic movements of all those manufacturers who are dealing within the smoke market. Let us talk about another example in relation to our lifestyle. When we talk of things like the high level of salt and sugar and chemical additives, customers have become so sensitive to all these things because of the health concerns that the manufacturers really have to bring about changes into the positioning of their brands. While talking about the positioning and the change in positioning let me draw your attention toward the factor which really stands out when we talk of positioning, the factor of what it is not. You will recall it is because of that factor that the manufacturers start talking about no added sugar, they start talking about no additives at all or this product does not contain a high level of salt so on and so forth. So these are the social concerns which you people have to address through the inner core of your brands and then communicate with your customers accordingly. And it is this driving force which really forces people like you to bring about changes in your positionings and this is not a small force. This really has a lot of serious repercussions. Look at the increased level of interest that people are having in physical fitness. That has given rise to so many different markets, the markets relating to exercise machines and the markets related to the mountain bikes for example. So when you are a part of those markets you have to think about the competitive adjustments which you should bring about in relation to your channels just to give you one example. What is important about this driver is or the driving forces that you should be able to develop a relationship between the changing social concerns and the changing trends that are caused by these social concerns and then be in a position to capitalize on those. Quick responders always seem to be the winners because they know when to take advantage of the changing concerns. So with the help of examples that I have given you you should be very clear about the dominance of this particular driving force. Having talked about the driving forces or the drivers of change, let us now talk about the link that we should establish between the driving forces and strategy. There is a very close link between the two because the strategy has to be driven by the driving forces, the prevalent in the marketplace and a strategy that has got to be a reflection of all those forces which shape up the market. Unless the managers can really assess the changes to which the driving forces are causing within their markets, they cannot really have an insight for the immediate future and the immediate future is like a period from one year to three years. They will not be in a position to plan well for that future unless they know what is the impact of those driving forces. So in other words, the managers have got to identify those forces in the first place and in the second place they must look into the implications that those forces have for their businesses and then relate the two in order to make their brands a success. The ones managers could have identified those driving forces, the next question which comes to their mind is or the next step which they have to undertake is about those factors which become very critical or which become key factors to bringing about those changes. So in other words, what we are talking about is in the first place the driving forces and the drivers which are causing change and then we are now going to talk about those factors which are very critical for the companies to make adjustments in order to respond to those changes. These critical factors are known as critical success factors. These are also known as key success factors. So the terminologies mean just about the same thing. What are these key success factors given in any setup? We have to learn those. Key success factors are those strategic elements like the product attributes, financial resources, human resources, your competencies and your competitive capabilities and other outcomes which really make a difference between a profit situation and a loss situation. These are the key success factors which really enable you to respond to the changes and when you respond to those changes, you respond to those changes with the help of your human resource, with the help of your financial resource and the competitive capabilities and there are so many other related factors which enable you to sustain your business. Businesses have to pay a lot of attention to all those factors in order to succeed financially and competitively in the marketplace. As a matter of fact, if a business can answer three basic questions about the industry, the answers will lead the companies to assess its capabilities in terms of all those key factors which the company needs to have in place to respond to the driving forces. Answers to these questions in other words are going to draw a relationship between the factors of success and the driving forces which are to be addressed in order to stay competitive because you can stay competitive only if you respond to the changes caused by those driving forces and you have to have certain key success factors to be able to do that. The first question is on what basis customers can choose between the different brands or different sellers? This sounds like a very familiar question and this may also sound like a very basic question which you ask in so many different contexts but here you see that you've got to ask this question in order really to ascertain whether or not you really have the basic capabilities in terms of your competitiveness, in terms of your resourcefulness, meaning human resource and financial resource and in terms of all those strategic factors that you have to have in place to succeed in the market financially and compatatively like I said. A very important question to answer. The second question which you must ask about the key success factors is what is it that a seller has to do to remain very competitive? Meaning what are the resources and competitive capabilities that really make someone very competitive? The third question is what is it that a seller has to do to sustain that competitive advantage? So the way to ask the question number two that addresses your competitiveness through resources meaning the human resource and financial resource and your other strengths that really give you a lot of competitive capability in the market. The third question addresses your ability to maintain and sustain those capabilities and you answer the question in a way which tells you what is it that it takes to maintain those abilities because maintaining the competitive advantage is something which is going to give you strength in the market. Keep in mind that key success factors are the industry related. Meaning those are the ones which could be taken advantage of by the industry as a whole or by those players who really are very sensitive to those factors. Meaning those players who are sensitive in terms of responding to the driving forces of change. And let me explain this concept with the help of an example. You are part of an industry which is huge and which is voluminous. High volumes are being sold by all the major competitors. It is an industry which is characterized by economies of scale because you cannot achieve good profitability unless you go for very high volumes and unless you really can achieve those economies of scale because everybody is going for volumes. Maybe you are selling something which is consumer consumable and the selling price of which is not very high. So in this situation the kind of strategy that you should craft you should be clear about that by now. Do you think a strategy that deals with a niche market is going to work here? No, not at all. You have got to come up with a strategy which deals with very high volumes and therefore deals with the channels which are compatible with selling high volumes and deals with a level of communication which you require in order to reach your customers. If you come up with a strategy which looks beautiful in terms of the words and in terms of its statement but really is based on something which should belong to a very small specialized kind of market then it is going to be at odds with the market because you are a part of. So by the same token I give you another example of the market which is very highly specialized and you are a part of that. Just think for a while that you are a producer producing high fashion garments. Now when you are doing that a strategy that deals with very high volume basic garments like t-shirts is really going to be at odds with a strategy that you really need in this kind of a situation. This is a situation in which you have to have a strategy that deals with something very special and while taking care of that strategy you have to think of very special stuff in terms of selection of colors at the start of every season or in terms of the fashion design which is very basic to the segment that you are dealing with and not something in a way that deals with run of the mill with the products. So the strategy that you have to have here in this situation has to stem from the specialized nature of the segment that you are dealing with. That may have its repercussions in terms of channels. Well as a matter of fact it certainly will have and it must have. You might start thinking in terms of having your own stores because it is with the help of a company owned stores that you really can bring the positioning of your brand to life. You are going to have the same brand name for your stores. You are going to go for a compatible decor of the store and thereby creating an overall aura and ambience which is very compatible with the positioning of the brand and hence not being dependent on chain stores or those supermarkets that sell everybody else's brands. So just look at the implications of the strategy in which you must be aware of in relation to the key success factors and in relation to the responses you have to have to the driving forces. The example of having the right kind of human resource explains it all. So if you are devoid of certain resources which are not really in line with your strategic thinking there is going to be a gap between the positioning of the product and your actual capabilities. So being very good managers you have got to make sure that everything falls in line. Make no mistake about one fact that you are not the only one player within the industry. You have other players, meaning other competitors and it all depends who is quicker in responding to the changes before others. Meaning who is the one who really can muster these success factors and then be in a position to respond to all those changes. And knowing that there is a very close relationship between these factors and the driving forces I would again draw your attention toward the fact that the key success factors are industry related and because of that nature those factors are not the property or are not the monopoly of one particular player or one particular marketing company. So those players that are in a position to more quickly identify the key success factors in comparison with their competitors are always better off. They are the players who are very sensitive to the changes that are taking place in the key success factors because of the changes in the driving forces. So in other words the driving forces could also change from time to time and whenever a change within the driving forces take place that also leads towards a change in the key success factors. It is not that a set of key success factors applying to our situation today is going to also work say three years down the line that may not be the case. Let me explain this with the help of an example. Global economic changes serving as an important driver may bring one industry into your country and hence could make it very important for you to look for certain key success factors. What has happened is all of a sudden that there is a lot of demand pressure in terms of making that particular product or those products which are now going to be manufactured in your country. Like I said earlier this has taken place because of the global supply chain which keeps making so many different countries as to the part of the overall links within the globalized mechanism of purchasing the different branded products destined for one particular market. So what happens is that the pressure in one particular country builds up and then so many manufacturers jump into the arena and when that happens the problem of human resource comes in. So you are looking at the human resource or the lack of it as one of the key success factors in relation to your industry. You think to yourself that in order to be successful in this particular industry given the fact that we have all of the resources meaning financial resource and the technological resource and of course the orders which are going to be offered to us because we are going to be part of the overall global supply chain, orders will keep coming. We only have to execute those and for that the most important or the most critical success factor is the availability of the right staff in terms of management and also in terms of labour. And this is what really happened to the apparel industry of our country. All of a sudden when the demand pressure built up and we were supposed to be making so many quality of battle for the buyers in the western markets the weed and shot of the human resource and the manufacturers were really running around like a scared rabbit looking for the right human resource which was very scarce. So this is one example of the key success factor which pops up as a result of a driving force which is the global supply chain. This is one example. So to summarise this I can say that the managers have got to stick to the very sensitive to all the key success factors which they must be able to identify and then capitalise on those. Let's take a look at a long list of the key success factors which a company should consider before making its or while making its strategic moves. Let me also make it very clear at the beginning of this list that the key success factors which are real keys to the success of a company mostly are never more than a couple in number it could be just one factor or it could be like two factors it is not that you really have to have a dozen factors in order to succeed. There are many things which are given and which are very basic and which have to be taken into account while you operate within one particular market but then there are certain changes which really make it important for you to look for those factors which have to enable you to respond to those changes. Back to the list, let's see what that is. It could be the low cost production efficiency. So in other words you can say that in order to be successful in our industry we have got to achieve the low cost of production otherwise there is no way that we can sell our product and still make certain profits. So obviously this has to be a company which has to be an industry with very high volumes. The second factor could be quality of production you are operating in a market which really requires very high quality and it is a key success factor. In other words if you cannot really come up with a meaningful level of differentiation supported by the relevant quality you cannot succeed. So this is a success factor. Another one is the access to the adequate supply of flavor access to the adequate supply of managers these are the very important factors and I just gave you one example in relation to global supply chain. Other factors could be like owning your own stores and owning your channels so to say past customer service could be a key success factor. Attractive styling and packaging could be a key success factor. You might talk about this factor because you know that your market in relation to your product is so much conscious of the styling because you are dealing with fashion for example you are dealing with certain packaged products in which styling again is very important so you may take this into consideration. I mean you must take that into consideration. Another key success factor could be perpetual advertising. Why do you think certain manufacturers could get into advertising and remain into the advertising the whole year because it is one of the key success factors. Huge volumes and a lot of competition a lot of entrance within the market and therefore a vital need to stay ahead of others and you tell your colleagues who are not from the marketing area listen this really is one of the key success factors if we do not do that we cannot make our customers retain the message and hence make it 100% sure that the next time they will go for the action desired on their part. So there could be so many the different key success factors of which a few that I have talked about but because of the positive of time the objective is that you've got to be very sensitive to all the changes which are taking place in the market and you've got to identify the drivers which are causing those changes and then you've got to identify and capitalize on all those factors which you think are the key to attaining success in the light of the changes that are taking place. So much for the market analysis and we get on to the third step of the second phase which is the planning process and this step is brand analysis. You get into a comprehensive brand analysis while you are working with your planning for the brand. The brand analysis starts with the brand model and that is something which really does not need a lot of discussion because the planning process starts with an understanding on part of the top management about the brand essence and the brand model and therefore it has to with the trickle down in terms of the understanding and then in terms of the strategy making and strategy execution. You've got to be very correct in terms of the model and thereby meaning about the essence and the values which your brand is going to offer and you must talk about that. So in other words the personality and the imagery and the brand identity that you are trying to create must be recognizable instantaneously. This basically is the prime objective of the brand analysis and therefore you've got to talk about the essence and the values in a little more detail. You talk about all the dimensions but you talk about those dimensions in relation to the capabilities of execution. You also talk about the communication media which is going to be put together preferably in a very integrated form. You recall the importance of the communication and the integration of all the tools that you have at your disposal and you've got to make sure that the message which you are going to create has got to be very coherent all along the campaign. So these are the kind of elements that you must take into consideration when you are analyzing your brand and you have started your analysis with the brand model. That is what I talked about. You must be very clear about the positioning of your brand and this again is something that goes without saying because this is something around all the strategies of the marketing process and rather other processes revolve. The brand's essence, the core values, the identity and the personality and the imagery and all other strategic considerations have to stem from the positioning of the product. So unless you are clear about the positioning you are not going to get into the areas of segmentation and differentiation in the right most way. As a matter of fact, I am talking about the importance of positioning here because while you analyze your brand you have to come up with a statement of strategy that talks about the level of differentiation in which your brand is going to offer to your customers and with the help of that differentiation you are going to occupy that position into the minds of your customers and that happens to be the prime, prime objective. So much for positioning in the context of the brand analysis and the rest you all know. The next step while you analyze your brand is objectives. This is an area which really deals with the numbers. You've got to talk about the numbers which you are out to achieve and you talk about the planned period like year one, year two, year three and projections in terms of the sales forecasts that you agree with the salespeople and that you envisage achieving at the end of the period. You also talk about your competition in this very context because you do take into account the volumes which are enjoyed by if not all of the players at least the major players do take into consideration their market shares, respective market shares and compare those with yours the way it looks like at the end of the planned period. You also talk about the growth factor of the industry and the market in other words like how many percent the market has been going over the past seven years meaning what have been the trends of the growth and on the basis of that you make your extrapolations and based on that you end up with certain numbers relating to your market share and high market share with the why high and low market share, why low and so on and so forth but the area primarily relates numbers. After you have taken into consideration your numbers the next step is the development of the brand's picture it is not that I am talking about all these elements over and over again this is an effort on my part to take you through the planning process as it is going to take place while you are on it what is the brand's picture the brand's picture is in the context of the planning process the combination of the creative elements like the brand's vision the brand's promise the brand's contract here while you go through the planning process you can't put down in writing in a very well structured way what the picture is and what are the set of the promises you are planning to deliver to your customers and based on those promises what is the contract which comes into being and the basic objective is to elaborate all these strategic elements in relation to the picture and contract and to make sure there are no gaps whatever you plan is very consistent because if you come up with something very consistent you are going to only legitimize the planning process and the brand's position so to say so the fact is if you are talking about a set of promises that can be delivered you are making sure that you can deliver the contract and when you see yourself in that kind of a situation you are only legitimizing the brand's position and that basically is the objective of this step of the planning process and then is the products and its variance you have got to talk about the product and all the sizes you are going to introduce you also have to talk about who, what, where factors because if you are selling biscuits you know there is a pack which is meant for the party time and there is a pack or small sachet which is meant for any time what is really meant by the product and its variance the importance of this step also is highlighted when you start talking about getting into the various other segments meaning when you relate your product with the kind of extensions that you may have to bring about at the future point in time which of course is the part of the plan then this really becomes highlighted and you will agree with me you have got to talk about the small pack which you do not really have as part of the portfolio at the moment but you think it must be brought about and introduced on the market you have to talk of that variant right now and take that into the planning process all the considerations must center around the brand promise and the contract and hence the positioning so this is something which I am highlighting again and again meaning the need for you to be very consistent in terms of the brand's vision the brand's positioning and the promise and the contract because wherever you get an answer to yourself not in line with what you are doing you are getting into inconsistencies and you are getting into your planning process which really is not in line with the overall strategic motives the next step in the brand analysis is naming there are different and divergent views on naming a product there are marketing experts who think there is not much in a name and in favor of this argument they cite so many names which really do not mean much you look around and you will find to yourselves that there are so many powerful names really do not reflect the positioning of the brand so in other words the other camp is a proponent of the reflection of your brand's positioning in other words you have to have a name which really expresses the inner core of the product and in doing so what you have to keep in mind is that the name should not be too broad that it really loses the essence of the brand of the brand's positioning and then at the same time it should not be too narrow that it starts depriving you of the possibilities of the brand extension you should be having a name which maintains the balance between being close to the positioning and at the same time not being too much away from the positioning the next step is the packaging through packaging you are going to highlight the personality of the brand now packaging has not to be mistaken for the brand's personality it is an outward expression of the personality which is based on the inner core and so on and so forth what is important is that we have to consider the utility and usefulness of this tool that we have at our hand while creating the package you must not overdo it and at the same time you must not come up with a package about which your customers might say well much is left to be desired you have to maintain a balance depending upon the quality of the brand quality being very relative you have got to decide the kind of segment that you are a part of and the pricing point which you have defined for that particular product you should come up with a compatible quality do not overdo it at the same time do not underdo it so that is the basic lesson of the packaging with this the time seems to be running out and I shall continue my next and last lecture with the discussion on the brand analysis and after having been done with the brand analysis I shall be done with the second phase of the planning process which in itself is known as the planning process and then get on to the final phase which is the brand plan which is the template which you are going to use as an outline for any new introduction or any reappraisal of an existing brand Allah Hafiz, until that time, thank you very much