Master Brand Strategy and Brand Extensions: Dos and Don’ts

The companies that operate multiple brands have the option of employing a Branded house strategy (Nivea, Google etc.) or Master brand strategy in which the Master brand becomes an overarching brand that serves as an anchor point for all its products and sub-brands or House of brands (eg. P&G, Mars) in which multiple branded house strategy in which every brand is treated and communicated independently and there is no linkage whatsoever to the other brands of the same company. We also see hybrid strategy for eg. Coca Cola, Pepsi and Amazon. While there are pros and cons in both, in today’s business environment with increasing media costs, reduced time to go to market, changing consumer behavior and multiple other reasons, we need a more cohesive, consolidated approach ie. Master brand strategy and hence it is now increasingly used by most of the big companies esp. in FMCG. It is because through this strategy, brands can manage a large portfolio and bring the brand’s purpose to life. It helps to create one unified brand that connects with customers on an emotional level, so they tend to be more emotionally and lifestyle driven than product driven. We can create larger, broader campaigns that have potentially more impact because they’re speaking about bigger ideas and more aspirational thoughts.

It can function as vehicles for universal messages that positively impact every sub-brand or product under the brand by virtue of “Halo Effect”. Halo Effect is consumer’s preference for a product due to positive experiences with other products of the same brand. Dove started as a soap brand and then extended into other product categories – shampoos, conditioners, hair oil, deodorants etc. Another good example is Dettol which started as a disinfectant and later extended into other categories – soaps, handwash, sanitizers. What is common in both the examples is that both the brands have stuck to their core positioning and have not deviated from it irrespective of which category they are operating in. Dove stands for moisturizing and each of the Dove products have the same core proposition of moisturizing and care, be it soaps or shampoos or conditioners. Dettol has always operated with “Germ-kill” proposition and same flows in every product line of theirs. This approach also sets a guard rail on where all can a brand be extended. For eg. since Dettol is all about germ-kill, it will never launch a shampoo since “germ-kill” is not a benefit sought in a shampoo category. People look for benefits like shiny hair, dandruff free hair, hair fall reduction etc. in shampoos. Some other brands that have successfully extended into multiple categories are – Maggi with “Quick snacking” proposition, Garnier with “Science + Nature” proposition.

A brand extension can be vertical ie. launching variants in a particular category (for example Dove soaps are now available in many variants with different ingredients) or it can be horizontal ie., launching the brand in other categories (for example Dove shampoos, Dove conditioners). In Vertical extension, communication could either potentially support all Variants (ie Extension copy), or focus on new news (Variant copy) and therefore have a lower or No Halo between variants. In case of horizontal extension, the extent of the commonality of the benefit(s) is high and therefore have a higher potential for Halo.

So how do we maximize Halo effect? The key is to communicate the commonalities of the brand while we also need to strike a balance on what is “common” across all products and what is “new and unique” for the variant. There are five things you need to keep in mind when developing a new communication which will decide how strong Halo effect you will get:

1.      Commonalities of the brand – Should be high for large Halo effect

2.      Relevance of core benefit to other categories – Should be high for large Halo effect

3.      Discriminator - Should be common for large Halo effect

4.      Executional consistency in the advertising style - Should be common for large Halo effect

5.    Focus on any new news/innovation – Should build on core credentials for large Halo effect

It is important to convey one consistent brand philosophy. Masterbrand strategy when executed correctly can create a distinct promise, position, personality, visual and verbal system. The only challenge is that it is less product specific, less audience specific and less market specific. But I would not be much worried about it as now people don’t buy products but they buy stories, stories of how a particular product or a brand will change their lives, stories about brands who talks to them, brands who listens to them and brands that they can relate to and brands who have the same values and beliefs as them.