The corporatisation of consumer brands

With easy access to information, there’s some blurring of lines that placed corporate brands in the hands of stakeholders and consumer brands in the hands of consumers.

Which vaccine did you get? If your response was AstraZeneca, and not Covishield, we rest our case. Not surprisingly, in these COVID times, perhaps, some of the most often mentioned brands are Pfizer, Moderna, or Bharat Biotech. Brands that we, as consumers, hardly ever mentioned before.

Now one might argue that in these times, a heightened need for trust is driving this relative prominence of the corporate brand in the health and hygiene category. But the shift we see is a larger one, across categories. And multi-brand organisations have been responding to it, by both strengthening their corporate brands as well as integrating it better with their consumer brands.

So, what’s changed? A lot. From changing consumer preferences to faster digital adoption.

The rise of the informed, conscious consumer

Insights we got from a recent Brand Usage and Attitude study for a sanitiser brand, revealed a surprisingly high level of awareness and a strong influence of the company brand in the consumer buying decision.

Whether it is squinting to read the fine print on a product pack in-store, clicking on the recently added ‘Store’ tab on Amazon, or researching consumer brands online, the consumers are focused on not just what they are buying, but also whom they are buying from.

With easy access to information, there’s definitely some blurring of the erstwhile clear lines that placed corporate brands in the hands of stakeholders and consumer brands in the hands of consumers (or customers, in case of B2B). Today’s consumer is far better informed on companies, their brands, policies and practices. The way the recent Nestle-Maggi controversy played out in media, amplifying the corporate-consumer brand relationship in consumer’s minds, is a good case in point.

The case for better integration strengthens further with the growing importance consumers and employees place in company values and brand purpose; more effectively integrated at the corporate brand level. A 2020 report by Capgemini concluded that “90 per cent of Indian consumers will purchase products and services from companies that give back to society during the current health crises”. While, the crises may have accelerated this shift, the shift to values based purchasing is a long-term one.

The recent spate of high profile rebrandings by Pfizer, Reckitt, General Motors, Volkswagen, AB InBev, among many others, reflect this. Summarising the intent behind the Reckitt rebranding, Jo Osborn, VP internal communication and corporate brand, said, “From Dettol to Lysol, Nurofen to Durex and Finish to Vanish, we sell more than 20 million of our trusted products to people every day, yet there is less recognition of the company behind those brands. Our new Reckitt identity will better enable us to communicate our corporate purpose to the world, and to do so in a way that is powerful, consistent and impactful.”

Digitally-driven brand integrations

The first wave of digital transformation sent a lot of companies on a buying spree, acquiring capabilities to secure their digital futures. Others chose to organically build their digital businesses. Through the last decade, the focus of these companies has been largely on internal capability building, leaving the branding side of the digital business largely untouched or independent. In the process, they have created a web of overlapping portfolio’s internally, and an under leveraged brand architecture externally.

We are in the throes of digital transformation 2.0, as organisations focus on unlocking the true market and customer value of these acquired or home-grown digital capabilities.

In just the last one year, we have engaged with more organisations, from B2B to CPG and education to media, wanting to build future-ready brand portfolios and architectures. In the process, transferring must have ‘digital’ reputations to the corporate brand, while infusing the acquired brands with the larger organisations’ stature, culture and values.

Schneider Electric and Accenture are two organisations that have been on a buying spree over the last decade. Both organisations follow a two-level brand hierarchy.

At the first level is, organising related brands, products or services under a corporate brand extension such as Schneider Ecostruxure or Accenture Interactive. And, at the second level, they follow a corporate brand endorser relationship with retained individual brands. For example, APC by Schneider, or Droga 5 - a part of Accenture Interactive.

From ‘platform’ integration to brand integration

When Disney acquired the STAR portfolio, it rebranded the video streaming service as Disney+ Hotstar, driving higher subscription, distribution, content and marketing efficiencies at a global scale under the Disney brand.

The rise of ‘platforms’ makes a stronger case for a unified portfolio under a corporate or umbrella brand, delivering better margins, higher cross sell and marketing efficiencies. We are loosely using the word ‘platforms’ here to include websites, e-commerce sites, streaming services, service or product aggregators, apps, etc.

In 2019, when Amazon added the Amazon Store feature, it was a boon to both businesses and consumers, driving portfolio efficiencies on one end, while enabling better consumer research on the other.

For technology companies, where the rate of product obsolescence is high, the case for better integration is even stronger, as brand lifecycles get shorter and new brands are launched at a faster rate. A stronger association with an umbrella brand provides more leverage to foster a long-term relationship with the consumer in an evolving product-brand space.

In conclusion, we agree that brand portfolio and architecture decisions are, perhaps, some of the most complex decisions in marketing strategy. There are many merits to separating the corporate and product brands, especially where company portfolios are highly diversified, or where consumer brands are strong and have ‘stretch’. The case for strengthening the corporate brand and a closer corporate-product brand relationship is only getting stronger!

(The author is Managing Partner, BrandStory Consult, a brand strategy and content marketing consultancy)