Extending your brand by optimizing your customer relationship
中兴面试
Scott Davis Managing Partner,Prophet,Chicago,Illinois,USA
Cathy Halligan Director,Prophet,San Francisco,California,USA
Keywords Brands,Relationship marketing,Customer care
Abstract Notes that the role of brand as more than just a marketing communications icon is increasingly obvious to leading business.Brand drives nearly two-thirds of customer purchas and impacts nearly every function area of the business.It stands to reason,then,that extending the equity of the brand will fuel growth while allowing the business to outpace competitors.This article examines the positioning considerations that will enhance the effectiveness of brand extensions.What is crucial as part of the underlying strategy is consideration of the organization's brand customer relationship and how extensions rve to broaden it.It requires combining a strategic viewof the entire organization's business drivers with principles and models from traditional and retail marketing to define newtools that
w ill make more of its total customer ba.
The Martha Stewart brand,synonymous with the notion ofraising the quality ofliving in and around the home,drives diver and complementary publishing,television,branded merchandi and retail business.
The largest lection ofMartha Stewart branded merchandi ±over 3,000products ±can be found exclusively at Kmart in the USA and Zellers in Canada.Far fewer products,1,200,are featured in the company's retail business:its catalog,Martha by Mail ,and the Internet The largest gment ofits business,reprenting over 60percent ofthe revenue ba,is publishing:magazines,books,the syndicated askMartha newspaper columns appearing in 225US and Canadian publications weekly,and the radio show,broadcast on 285stations in the USA,covering 93percent ofthe total US market.
我喜欢一个人
The business are diver,but the Martha Stewart brand is the key ast optimizing the value ofthe f ranchi.
Martha Stewart Omnicom (MSO)is one in an emerging category of companies characterized by multiple customer contact points,complex product,rvice and content offerings,and multi-layered ad
vertising and margin-bad revenue structures.The companies require new practices in how they develop and manage their most strategic asts ±their brand and their customer ba.
Martha Stewart's success has largely been due to the understanding that growing the value the brand reprents involves more than extending
the The rearch register for this journal is available /rearchregisters The current issue and full text archive of this journal is available /0736-3761.htm
Prophet is a strategic professional rvices firm with offices in San Francisco,New York and Chicago and is part ofthe Catenas network.
Exclusive to Kmart Emerging category of companies An executive summary for managers and executive readers can be found at the end of this article
brand through the addition ofproducts and rvices or through maximizing the multitude ofdelivery ch
annels through which a brand can be built.It understands that,implicit in successfully extending the brand,are the underlying associations it creates,maintains or grows,all ofwhich imply a promi to customers from the organization as a whole.
But could Martha Stewart be doing more to extend its brand by better optimizing its customer relationships across the distinct delivery channels ±and other customer touch points ±through a more holistic approach?It quite possibly could,by adding another tool to its arnal,which we at Prophet call customer relationship optimization (CRO).
Why extend your brand?First,however,consider a briefoverview ofthe entire proposition ofbrand extensions.
The best companies managing brands today recognize that brand,and what it reprents,drives almost two-thirds ofmost customer purchas,impacting nearly every functional area within the organization.
This translates into what Prophet calls the brand-customer relationship.Building and prerving this relationship is a crucial strategic motivator among tho leading corporations that understand brand;this is,in fact,a true ast ofthe total business and not merely a marketing communications ico
n.And stewardship ofthe brand is the underlying rationale behind their decision-making process ±including the analysis that should go into brand extensions.
Brand extensions ±or extending the equity ofyour brand ±are crucial to both fuel growth and outpace competitors.The brand has been accepted and proven in the marketplace through existing products and rvices.New offerings are stamped with instant credibility and a built-in endorment from the underlying brand.
However,David Aaker,author of11books on brand and considered by many as the modern-day ``father''of brand,cautions in his book Brand Leadership (Free Press):
When a product is tied cloly to a product class,its potential to extend is limited ...Brands that have credibility in intangible associations ±such as weight control (Weight Watchers),healthy eating (Healthy Choice)...±are more able to extend to new categories becau tho intangibles work in a wide variety ofcontexts.
Extensions should support brand positioning Extensions are even more powerful when linked back to the customer relationship and how it has been ud as a basis for your brand positioning.This means ensuring that the extension builds off one or more of the following positioning components:
.It extends your target market.Gillette's Sensor for Women leveraged the definition of the business Gillette is in and its brand benefit of the ``clean shave,''effectively extending its target market from only men to all adults who shave.
.It extends your business definition.In launching IBM Consulting,IBM changed the definition of the business it was in from ``technology-bad''to ``technology-bad solutions.''
灰姑娘英文故事Optimizing customer relationships Brand-customer relationship Positioning components
.It extends your point of difference.By introducing the benefit of ``guaranteed videos in stock,''Blockbuster has grown its points of differentiation.So has Federal Express by establishing a new drop-off time for packages of midnight in some locations.
有时候有时候造句
.
It extends the entire positioning.This usually occurs when a business is trying to enter a new market for the first time with a brand who strengths are recognized beyond its current target market and current definition of the positioning.The introduction of Caterpillar Footwear extended Caterpillar's reputation and brand strength from the heavy equipment market.This can be risky,but done right,it all
我和老师的故事ows a company to diversify its range of branded products and take a true portfolio approach to managing its brand.Deepening ±and optimizing ±the customer relationship Clearly,the proposition ofextending a brand and its equity is cloly tied with the customer relationship now and as,ideally,you would like it to develop.Defining and acting on that relationship is more problematic today than ever before.Evolving business models involve multiple customer touch points,an increasingly complex range ofproducts,rvices and content,and multi-layered advertising,commission and margin-bad revenue structures.The demand new practices not merely in managing,but in optimizing the customer relationship.
The CRO perspective requires a more holistic and enterpri-level understanding ofthe brand as the amalgamation ofall customer experiences,and a strategy for managing multi-faceted relationships.Further,it requires a clear understanding ofthe value the customer wants to derive f rom the enterpri ±and the value the enterpri derives from the customer.
Apply this perspective to MSO.Each business gment and delivery channel has a distinct and parate revenue structure and customer ba.Licensing fees drive branded merchandi.The retail business is a gross margin-bad business.The largest business,media,is an advertising model.
Assume that there are a finite number of targeted outbound contacts/marketing impressions to which the consumer could cost-effectively be pushed.Does MSO ``spend''tho contacts with a primary ``call to action''to visit the Martha Stewart collection at Kmart,to ``touch and feel''its branded merchandi?Does it spend them to drive consumers to its Web site?Or with a primary call to action to subscribe to Martha Stewart Living?Or to watch the television show,to maximize viewership and thereby advertising revenue?
Most likely the targeted contact and content strategy involves a combination ofthe approaches.But how are the decisions made?
Tools pushing the strategy Traditional direct marketing tools rely on the customer databa populated with purcha and non-purcha interactions,and appended data,anchored in a comprehensive,consolidated customer record.In this situation,it is not enough to u key variables such as recency,frequency,monetary (RFM)value ud in gmentation driven by transaction behavior.
Applying CRO principles would combine a strategic view ofthe entire organization's business drivers with principles and models from traditional and retail marketing,defining new tools to make more of its total customer ba ±and effectively help extend the brand.
Extending a brand Contact and content strategy
Thus,the are the questions MSO's strategists could be asking:
.What is the value to the enterpri ofeach customer interaction (touch point)?What is the hard revenue MSO realizes when a consumer purchas a branded product at Kmart?Bad on analysis/rearch,when a customer has a Kmart transaction history,how does it compare to tho who do not?An innovative technique might need to be deployed to directly capture the Kmart transaction in the MSO customer databa.One might also look at the revenue potential ofa customer who has purchad through Martha Stewart by mail,and has subscribed to Martha Stewart Living.How does this customer's revenue potential compare with that ofone who has both of the transactions,but also has a purcha ?
.What customer actions best drive value in the enterpri?Traditional direct marketing maximizes transactional value (respon rate and average order)for each promotion/offer.A holistic view rves better here.Ifa subscriber to Martha Stewart Living delivered more value over time to the franchi,would not one want to aggressively market subscriptions to Martha Stewart Living,even ifthe ``transaction''has a lower immediate value than a $100purcha online?
淡然一笑.
What customer action would best strengthen the brand-customer relationship?Martha Stewart would analyze its data to understand key trigger activities after which a deeper relationship with the customer is realized.For example,a customer need should be recognized when an address change is registered with Martha Stewart Living.Given the organization's range of offerings,now would be the time to draw on the content and merchandi most relevant to the consumer at this life event ±moving ±to cement a long-lasting customer relationship.
李师道
.
What company action is most likely to lead to the desired customer action?Respon testing is the tool to deploy.Given the customer's trigger activities,and the desired activities that add value to the enterpri,contact,content,offer and vehicle are tested to learn what drives the optimal business result.Using the earlier example,ifa Martha Stewart Living subscriber drives the most value in the enterpri,and the trigger event is his or her registering on the Web site,should an outbound call be made?A subscription offer be mailed?An e-mail be nt?Or a copy ofthe catalog with a subscription blow-in card be mailed?Does a promotion need to be offered to increa conversion rate?Does the increa in conversion rate pay for the cost of promotion?The are the questions that would be answered during respon testing.MSO would now know its customer model,the desired customer a
ctions to deliver value to the franchi,the actions that best strengthen the relationship with the brand,and have tested contact,content,offer and vehicle activities.The organization could now put in place strategies that optimize and leverage the customer ba ±and extend the brand ±across the entire franchi,not solely divisions within it.
Conclusion The evolution ofnew and increasingly complex business models has incread the challenge to organizations to consider the brand-customer relationship in a new light.In order to better leverage and extend the value of the brand,this means a careful examination of what it reprents and how it is reprented throughout the organization as a whole ±and using strategies and tools that go beyond yesterday's approaches.&
Hard revenue Key trigger activities Customer model
Executive summary and implications for managers and executives Building customer relationships into the brand Davis and Halligan in prenting Prophet's customer relationship optimization (CRO)model identify a ries of issues for marketers that derve more attention and certainly need greater understanding.The central issues arising are:.When and how to extend or expand the brand ±widening the target market;±shifting the business definition;±
reinforcing differentiation;±changing the brand positioning.
.Recognising that brand equity derives from the customer ±customer relationships are central to successful brand marketing;±customers reach us through multiple channels;
±
aiming at an optimal customer relationship..Moving from transactional to lifetime marketing
±第一次演讲
RFM (or RFV)models are inadequate tools for relationship management;±
total value of a customer is the significant measure;±
non-purcha respons can strengthen the brand bringing longer-term returns;±marketing action should focus on achieving the best respon from individual relationships over time.
.How do we model the way in which customers respond to our branded messages?
±
databa modelling needs to move on from traditional tools;±
strategies must reflect relationships rather than transactions;±
generic brand offers are stronger and more flexible than ``mono-product''brands;±brand management is a corporate responsibility not just a sub-t of sales and marketing.
(A pre Âcis of the article ``Extending your brand by optimizing your customer relationship''.Supplied by Marketing Consultants for Emerald.)
This summary has been provided to allow managers and executives a rapid appreciation of the content of this article.Tho with a particular interest in the topic covered may then read the article in toto to take advantage of the more comprehensive description of the rearch undertaken and its results to get the full benefit of the material prent
