Page 343 - Marketing Management

320 PART 4 BUILDING STRONG BRANDS

ensure consumers would continue to pay their premium prices. Ads for Bounty claimed it was more
absorbent than a “bargain brand”of paper towels; headlines in print ads for Olay Professional Pro-X’s
Intensive Wrinkle Protocol proclaimed, “As Effective at Wrinkle Reduction as What the Doctor
Prescribed. At Half the Price.” 82

Fine-tune Brand and Product Offerings

Marketers must ensure they have the right products to sell to the right consumers in the right places
and times. They can review product portfolios and brand architecture to confirm that brands and
sub-brands are clearly differentiated,targeted,and supported based on their prospects.Luxury brands
can benefit from lower-priced brands or sub-brands in their portfolios. Take Armani as an example.

Armani Armani differentiates its product line into three tiers distinct in style, luxury,
Armani customization, and price. In the most expensive, Tier I, it sells Giorgio Armani and Giorgio

Armani Privé, custom-made couture products that sell for thousands of dollars. In Tier II, it
offers Emporio Armani—young, modern, more affordable styles—and Armani jeans that
convey technology and ecology. In lower-priced Tier III are more youthful and street-savvy
translations of Armani style,A|X Armani Exchange, sold at retail locations in cities and suburban malls.The
brand architecture has been carefully devised so each extension lives up to the core promise of the Armani
brand without diluting the parent’s image. But clear differentiation also exists, minimizing consumer
confusion and brand cannibalization. In tough economic times, the lower end picks up the selling slack and
helps maintain profitability.
Because different brands or sub-brands appeal to different economic segments, those that target
the lower end of the socioeconomic spectrum may be particularly important during a recession.
Value-driven companies such as McDonald’s, Walmart, Costco, Aldi, Dell, E*TRADE, Southwest
Airlines, and IKEA are likely to benefit most. Spam, the oft-maligned gelatinous 12-ounce rectan-
gle of spiced ham and pork, found its sales soaring during the recession. Affordably priced and re-
quiring no refrigeration, Spam is, its maker Hormel claims,“like meat with a pause button.” 83
Bad times also are an opportunity to prune brands or products with diminished prospects. In the
recession following the 9/11 tragedy, Procter & Gamble divested many stagnant brands such as Comet
cleanser, Folgers coffee, Jif peanut butter, and Crisco oil and shortening, to concentrate on higher-
growth opportunities with much success.

Summary

1. A market leader has the largest market share in the rele- 5. As important as a competitive orientation is in
vant product market. To remain dominant, the leader today’s global markets, companies should not overdo
looks for ways to expand total market demand and at- the emphasis on competitors. They should maintain
tempts to protect and perhaps increase its current share. a good balance of consumer and competitor monitoring.
2. A market challenger attacks the market leader and 6. Because economic conditions change and competitive
other competitors in an aggressive bid for more market activity varies, companies normally must reformulate
share. There are five types of general attack; chal- their marketing strategy several times during a product’s
lengers must also choose specific attack strategies. life cycle. Technologies, product forms, and brands also
3. A market follower is a runner-up firm willing to maintain exhibit life cycles with distinct stages. The life cycle
its market share and not rock the boat. It can play the stages are usually introduction, growth, maturity, and
role of counterfeiter, cloner, imitator, or adapter. decline. Most products today are in the maturity stage.
4. A market nicher serves small market segments not 7. Each product life cycle stage calls for different marketing
being served by larger firms. The key to nichemanship strategies. The introduction is marked by slow growth
is specialization. Nichers develop offerings to fully meet and minimal profits. If successful, the product enters a
a certain group of customers’ needs, commanding a growth stage marked by rapid sales growth and increas-
premium price in the process. ing profits. There follows a maturity stage in which sales