The first, short-term strategy is to build on existing clients.

Customer relationship management (CRM),

database management and relationship .It is necessary to get still closer to the consumer, one’s own
consumers, who may be faced with too much choice. Seducing new customers seems too costly
(Reichheld, 1996). The second one is to carry out more research. What needs, or lacks of satisfaction or
untapped uses can be better met?

Growth through existing customers

1. Building volume per capita: Brand management over time is the permanent pursuit of growth.
One way of achieving this is to move from a pattern of low-volume use to a pattern of
potentially higher-volume use. To do this, the brand needed to create an association with
parties (a consumption situation which has a galvanising effect on volume). The brand created a
micro-marketing plan specifically for this purpose, ‘The Jack Daniel’s occasion’.
2. Building volume by addressing the barriers to consumption: In the task of growing volume
through higher consumption per capita, identification of what blocks consumption is not always
obvious. Research is needed. One way to do it is to segment the clientele according to the
strategic matrix shown

3.
For instance, in Europe households in this cell consume 70 per cent by volume of Coke Light, but only 48
per cent by volume of Coke. These two figures highlight how a single innovative product can release the
barriers that prevent people from consuming more.

4. Growth through new uses and situations: It is understandable that brands should seek to grow
by breaking into high-growth-rate consumption situations in which their attributes give them a
high degree of relevance. Such a movement often requires the launch of a new product or line
extension.
5. Growth through trading up
6. A classic growth strategy is trading up. Customers may wish to receive an upgraded service or
product from the brand. Gift packs and ‘special series’ capitalise on collectors’ motivations.
Larger formats have a built-in attractiveness too.
Line extensions: necessity and limits
 Multiplication of formats and sizes (typical in cars but also in soft drinks).
 Multiplication of the variety of tastes and flavours.
 Multiplication of the type of ingredients (for example Coca-Cola with or without sugar, with or
without caffeine, types of motors in the Ford Escort).
 Multiplication of generic forms for medicine. l Multiplication of physical forms such as Ariel in
powder, liquid or micro formula.
 Multiplication of product add-ons under the same name, corresponding to a same consumer
need in what is called line extension. Thus, Basic Homme by Vichy comprises a line of toiletries
including shaving foam, soothing and energising balm, deodorant, and shower gel.
 Multiplication of versions having a specific application. Shampoo brands multiply endlessly, with
varieties suited to different types of hair and scalp condition.

Range extension naturally follows the logic of marketing and of even finer segmentation to better adapt
the offer to the specific needs of consumers, needs that never stop evolving

Quelch and Kenny (1994) recommend four immediate actions for better management of range
extensions: l Improve the cost accounting system to be able to catch the additional costs incurred by a
new variety all along the value chain. This enables the real profitability of each one to be assessed. l
Allocate resources more to high-margin products than to extensions that only appeal to occasional
buyers. l Make sure that each salesperson can sum up in a few words the role of each product within the
range. l Implement a new philosophy where product withdrawals are not only accepted but encouraged.
Some companies only launch an extension after having cancelled 226 CREATING AND SUSTAINING
BRAND EQUITY another with a low turnover. This withdrawal does not have to be brutal, but can be
done gradually so that clients turn to other products within the range.

Growth through innovation

Creating desire in saturated markets

These are innovations that create a new value curve by suppressing some benefits and boosting others,
at an unprecedented level. RyanAir and Nespresso are classic examples.

A source of competitive advantage

Only innovation can slacken pressure on costs: it generates desire and a temporary monopoly. However,
modern competition is all about non-durable but constantly repeated advantages, and sometimes
allows new segments to be opened in which the innovating firm becomes the market standard. This fact
is important for mass retailers.

What mass retailers want

Mass retailers are on the lookout for innovations that create value rather than just move market share
from one brand to another. They expect the creation of new categories or segments that will dynamise
sales and margins.

Innovation brand oxygen

The virtuous cycle of innovation

What managerial conclusions can be drawn from the above points? As Figure 9.3 shows, the brand can
be managed in two ways. Brand management is thus a balance between preservation, renewal,
extension and growth of the prototype on the one hand, and on the other the creation of new products
and services to capture new circumstances of use and new customers, and to open new segments. The
first part maintains, feeds and consolidates the brand base, while the second opens bridgeheads into
the future, carrying what will tomorrow become the brand’s new prototype.

The effect of innovation on sales

Innovation reframes the brand’s image and feeds it with the new tangible and intangible attributes
brought by this innovation.
Disrupting markets through value innovation
The goal of all brands is to look for value innovations, an unprecedented bundle of attributes
that shifts the preference function of consumers

Managing fragmented markets

Nike’s success can be explained the same way (Bedbury, 2002). It offers an increasingly broad
array of niche products (a sign of mass customisation), thereby creating relationships with
subsets of the market, with fragments. Being more involved with a product tailored to them,
customers are ready to pay more. Nike now produces a number of collections even for a single
sport. Also to maintain the thrill, product life cycles have been shortened from one year to three
months. As a whole, all these examples demonstrate the need for greater innovation in all
aspects of the marketing mix, from product, channel and store to communication to match the
fragmentation of demand.

Growth through internationalisation

The brand succeeded in growing its sales in value through three strategic actions: l Permanent
innovations in the format, packaging and handling of the packs. All these apparently tiny
improvements gain significance when one has to shop for water. l Systematic repositionings of
the brand, from generic health and nature to equilibrium and now to the concept of eternal
youth, while remaining within the brand’s identity. l Extending the brand. As early as 1962, Evian
was a pioneer in brand extension. In response to hospital requests it introduced a spray to
vaporise water on the faces of patients and babies.