Market Data Usage in Brand Management activities
Every day at work you have to make decisions. In brand management, these decisions can have a significant impact on your company’s results and brand growth. Market data served in a structured and comprehensive way will make the decision-making process easier and faster.
In this article, you can read about reasons why and ways how to make data your strongest ally in brand management.
Brand Management is of crucial importance for every company’s success. The role of brand management, as a marketing function, is to increase the perceived value of a product, service, or brand over time.
In other words, to increase customer’s willingness to pay and create a base of loyal customers with positive brand associations and images, which will be followed by strong brand awareness among the targeted population.
A successful brand manager creates brand awareness by using all 4 elements of the marketing mix, including the price, product packaging, logo, and other visual elements.
More specifically, a brand manager is aware of the following:
- What is the winning product mix for his/her brand?
- Best pricing strategies for successful brand management
- Display share importance in brand growth
- Why is channel monitoring important for brand management?
But prior to addressing each of these topics, let us cover another important part of brand management.
Word of the Day: Competition Analysis
Tracking the competition means gathering and analysing the data about the brand’s direct competitors. By doing that, the brand managers are decreasing their risk while making regular day-to-day business decisions.
Competition analysis provides you with relevant market data and helps you to make important decisions based on accurate market information.
Brand managers often have a task of regular and extensive reporting about their products, competitors, and customers. This data is then used by R&D and marketing teams in order to align the strategy to achieve better outcomes.
Still, some companies and brands nurture the opinion that focusing on their own products, services, and customers is enough for success. The belief that competition tracking is unnecessary often comes from the fact (or subjective impression?) that their product or service is unique on the market. Sometimes it can be heard that a brand is still too small to invest resources in terms of time and money in competition analysis.
In any scenario, competition analysis is a must-have step in the brand management process. It can bring you a significant advantage. If you are constantly analysing the market data, you should be able to predict your competitor’s moves. It can also help you to better understand and serve your target group of customers.
How to track the market and your competition?
- Regularly visit and analyse web sites of your competitors
- Read customers' reviews and ratings
- Use Google or other search engines to check what’s new on the market
- Visit a competitor’s shop (retail or online) and make a purchase
Every method stated above can bring you some useful information set, and there is a high probability that most of the beginners will start their business that way. The reason to do so can be a limited budget or simply an initial phase of competition tracking.
When the business starts to grow, more professional methods become a usual way to go.
Today, most market intelligence data are served through some form of specialized software, often a web-based SaaS solution, which is paid monthly and can be used directly from the browser, without the need for additional installations and/or setup.
These kinds of solutions are using the power of technology for capturing information in every moment.
By going back to the 4Ps in the marketing mix, we can say that you can gather a different kind of data about your competitors:
- Product mixes
- Pricing strategy
- Channel coverage – placement
- Promotion cycle and intensity
Check out how you can do all that at the same time by using our KLIKER market tool.
1. What is Winning Product Mix for Brand?
Product development costs may be enormous, as well as the supply chain costs for a big number of SKUs in the portfolio. Therefore, one of the key decisions a brand manager must make for his/her territory (or his/her market) is about the product mix. Every industry has its own specifics, but in general, the problems to resolve are the same:
- Do my products cover the category range (price-wise, tech specs, features) well?
- Does my product mix in this market correspond with the brand’s growth strategy?
- Do I have a direct competitor for every SKU in my competition’s portfolio?
- Is it better to include additional variants of the same product (e.g. different colours, multipackages) or spread the product mix with lower-price models or different technology/taste/shape products?
In product mix analysis it is important to be clear on product features we use to differentiate products through categories. In FMCG, for food products, it can be a share of sugar, packaging size, or simply flavours. In consumer electronics, it is often the battery size, screen size, and type or RAM size in GB.
When you analyse your category through KLIKER market, you will notice we are using a very detailed feature set. Multiple features are used to filter and classify the products, more than 20 in some cases, every one of them specified by an industry specialist for that category.
2. Best Pricing Strategies for Successful Brand Management
Pricing strategy is sometimes taken for granted in everyday decision-making process. Brand managers should be aware of different techniques and tools used in the pricing and combine them with their own understanding of the market and the company’s risk-taking ability.
There are multiple pricing strategies, with one common objective: to maximize the company’s profit. Combine this with retaining consumer premise, and you get a very difficult task that should be approached thoroughly.
Generally Used Pricing Techniques
|Penetration pricing||for gaining market share, mostly used when entering a new market|
|Economy pricing||promotion and marketing costs are kept minimal, so the prices are low|
|Psychological pricing||using consumer’s emotional response instead of his rational one (ex. prices ending in 99 work better than on 100, putting a more expensive product next to the top seller)|
|Product line pricing||pricing a range of products with a logical increment of price|
|Pricing optional products||base product pricing is kept low, additional options are charged separately|
|Pricing of captive products||ex. toners for printers, or blade for razors – pricing needs to be set at the marginal rate where the customers still want to buy the main product, making them our permanent buyers pf the captive products in the future|
|Promotional pricing||discounts, free gifts, coupons, vouchers, bundle offers…|
|Geographic pricing||pricing depends on scarcity of the product, shipping costs, taxes and customs rates, currency rate, country’s purchasing power|
|Value pricing||reducing the price due to external factors like competition or recession, with the aim of salvaging as much customers as possible|
|Premium products pricing||increasing the price of products with a unique branding approach – the features and characteristics of these products are usually not much different from the competition, but the service and image around them is what makes them premium|
|Competition-based pricing||focus on the existing market rate for a company’s product – the choice is to price slightly below the competition, the same as the competition or slightly above your competition|
|Markup pricing||increasing the manufacturing or development cost for a certain markup (%); markup can be constant on all products or specified for each product line or category|
|Dynamic pricing||also known as surge pricing, demand pricing, or time-based pricing- a flexible pricing strategy where prices fluctuate based on market and customer demand|
|Freemium pricing||offering a basic version of the product or a service (often SaaS software) free, hoping that users will eventually pay to upgrade or access more features|
|Discount Pricing||the initial price is high, but it gets lower when the product is out of season or fashion – for products that will soon be out of the portfolio|
3. Display Share Importance in Brand Growth
Display share of a product is directly connected with the sell-out share of the same product. Retailers know that very well, so display positions in their shops have become the ‘product’ they sell to vendors and brands.
Let us put it this way – if you aim for 24% sell-out share on the market, which scenario is more likely to achieve this?
- SCENARIO 1
You have 22% of display share (meaning that 22% of all display positions in all retailer’s shops are yours) with a diversified product portfolio
- SCENARIO 2
You have 12% of display share (12% of display positions on the market) with 3 products that are meant to be top sellers
Intuitively, scenario one. The brands must include the costs of development, marketing, and display of ‘filler’ products in order to achieve the visibility high enough for desired sell-out share.
In KLIKER market you can see Display share for a selected category, on a selected market. Contact us if you want to know how.
4. Why is Channel Monitoring Important for Brand Management?
After the brand has selected products for a perfect product mix, defined which pricing strategy to use, and achieved a desirable display share, the ‘only’ job left is to monitor and manage sales channels.
Even though brand’s sales and logistics setup can be very different – completely in-house, partially outsourced through logistics partners, or completely outsourced through distributors, it is equally important to be aware of the condition in the channel:
- On stock & Out of stock coverage for every retailer
- Promotion periods and prices
- New listings of your product (new retailers)
By using KLIKER market interface, brand managers can find this information in just a few clicks.
Growth – Common Goal
Once established, a brand must continually maintain its brand image through brand management. Effective brand management increases brand awareness, measures and manage brand equity, drives a consistent brand message, identifies, and accommodates new brand products, and effectively positions the brand in the market. If we summarize all this – it ensures the brand’s growth.
Internal organisation and roles within companies may vary, but there is always a ‘brand owner’ for a designated market whose purpose is to ensure this growth. Sometimes this owner is called country manager, sometimes brand manager, but the objective remains the same – increase profits of the company by increasing one of the factors influencing it (display share, price, product mix).
What you have just read is our way of thinking about Brand management. These were our guidelines when we were creating KLIKER market (or more specifically Brand Management module as a part of KLIKER market) and they still are, as we are constantly working to improve it.
Our loyal base of customers proves that we are on the right path since worldwide brands in the consumer electronic business are regularly using KLIKER market to manage their brands.
We would like to hear what you think about this topic, so we invite you to give us your feedback. If you are interested in how KLIKER can help you do your job faster and with less risk, contact us for free consultations or for a demo.