Supporting the Right Brands

Viewpoint by Joseph Gelman, Partner

The most common driver of brand proliferation is the company structure, meaning, a business unit equals a brand. Although this is not the ideal scenario, it is a  reality we find in many organizations, big and small.  

Having a brand means power, a headcount to support it, an advertising budget, and a sense of belonging and identification with an emotional asset.  When we analyze a portfolio, we find that it is not worth it to have too many brands, as they begin to cross over the existing business unit structure and create cloudiness in the eyes of consumers.

Instead, companies must create a long-term strategy for their portfolio that is driven by customer-insights and creates brand platforms with long-term growth potential.  This not only eliminates waste and inefficiencies to build fewer, stronger brands with less overlap, but better manages linkages among brands to enhance credibility.  

Optimizing a portfolio may create organizational challenges as you move away from the "business-unit-as-brand" structure.  Ultimately, however, in works in favor of serving the customer and creating a streamlined portfolio that generates value for the business.