Brand-Centric Transformation

Balancing Art and Data

The Boston Consulting Group (BCG) is a global
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leading advisor on business strategy. We partner
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tage, build more capable organizations, and
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For more information, please visit www.bcg.com.
Brand-Centric
Transformation
Balancing Art and Data

Dylan Bolden, Antonella Mei-Pochtler, Rohan Sajdeh, Gaby Barrios, Erin George,
Keith Melker, and Deran Taskiran

July 2011
AT A GLANCE

Brand transformation can anchor a growth or turnaround strategy, driving custom-

er loyalty, profit, and shareholder returns. However, the strategic investment
decisions required to shape and strengthen the brand must be tackled with rigor
and discipline: debated by senior management, grounded in data-driven insights,
and embedded throughout the organization.

Grounded in Insight
A robust approach to branding synthesizes a variety of consumer insight sources—
including qualitative interviews, quantitative market research, internal financial
information, and competitive landscaping—in a systematic process.

A Four-Step Solution
On the basis of our work in brand transformation with leading companies world-
wide, we recommend a four-step methodology that quantitatively links the brand
benefit ladder to brand strategy and then translates strategy into reality.

Making it Real
Each relevant business function needs an action plan for internal execution,
converging to create an integrated brand ecosystem for the customer to experience.

2 Brand-Centric Transformation
G oogle, Apple, Nike, Louis Vuitton…just a few of the names on any list of
top global brands. These companies demonstrate without question that a
brand can drive tangible financial impact and increase value for employees,
customers, and shareholders. Of course, the inverse is also true: poorly crafted
brand-building efforts can waste precious dollars from marketing budgets already
stretched thin.

With so much at stake, brand-building cannot be left to chance—or to creative

advertising alone. The critical strategic-investment decisions required to shape and
strengthen the brand must be tackled as such: debated by the most senior execu-
tives, grounded in data-driven insights, and embedded throughout the organization.
Too often, however, brand transformation efforts falter because they lack the rigor
and discipline that are applied to other business initiatives.

On the basis of our experience with companies in a variety of consumer-facing

industries, we recommend a different approach to brand-building. Our approach
starts with in-depth consumer insight and then continues through implementation
and performance measurement. Along the way, company executives must combine
sophisticated market research with economics-based thinking and business strategy.
They must rigorously quantify every tradeoff and decision in terms of value to the
business. In the end, of course, no brand proposition is “real” until it is reflected in
everything the customer experiences: from the five senses to the emotions; from
expectations to the affirmation of the brand promise.

In developing their branding strategy, companies must move beyond qualitative

research, such as consumer interviews and focus groups. These techniques can
provide rich insight and emotional depth, but they are not conclusive. A more
robust approach synthesizes a variety of insight sources—including quantitative
market research, internal financial information, and competitive landscaping—in a
more holistic process.

Rules to Remember
Building a strong brand is not an end in itself but rather a means to an end—a
means by which a company is able to drive customer loyalty, sales, profit, and
shareholder returns. Executives looking for new avenues of growth or a turnaround
in financial performance are often wise to consider a brand transformation as one
component of their strategy. (See the sidebar “Hilton: A Brand Transformation in
Travel.”)

The Boston Consulting Group 3

 HILToN: A BrANd TrANsformATIoN
IN TrAvEL
In recent years, midsegment, full- One brand, Hilton Hotels & Resorts,
service hotel brands have faced a asked a more fundamental question:
daunting competitive threat. A so- In this changing environment, what
called focused-service segment has should we promise our guests and what
presented a new value proposition: do we need to do to deliver on that
excelling in the execution of the promise?
basics while offering complimentary
core services (such as Internet con- Hilton is one of the oldest and best-
nections and breakfast), all at a 25 to known hotel chains in the world. At
50 percent lower price. many companies, such a strong
brand heritage could become a
All full-service brands have sought to roadblock to innovation, but Hilton’s
stem the loss of guest nights to this management set a vision of stepping
disruptive segment. Most have boldly beyond that heritage. They
approached the problem operation- launched the biggest global-research
ally, tackling one or two areas to program in the company’s history to
better attract guests. One hotel brand support a robust brand-reinvention
updated its lobbies to serve as a effort.
social gathering place, while another
brand focused on its restaurants and Hilton’s insights helped the brand do
another installed public Internet the following:
stations. Despite their high costs,
these efforts served mainly as one-off • Face tough realities: the brand no
guest hooks—not holistic reinventions longer stood for luxury and
of the value proposition. glamour

But how to ensure that your brand-transformation effort will succeed? We suggest
keeping a few key rules in mind.

The brand can’t live on emotions alone. While emotional resonance is a pre-
requisite for brand value, it will never be the only critical element. Marketers
cannot focus solely on “the creative” (such as advertising) to forge an emotional
connection on the part of the consumer. Instead, they must firmly link the emotion-
al connection to the underlying product or service attributes and to the customer
experience.

The brand can’t be everything to everyone. Any brand-building effort involves

significant investment decisions targeted specifically to capture high-priority
consumer segments. Managers must make the tough tradeoffs required to keep the
brand on target, and reject anything that isn’t “on brand.” As an illustration, if an
edgy lingerie company could easily make and sell thermal underwear but the size
of the opportunity is relatively small and the connection to the brand’s core emo-
tional values is weak, then choosing not to pursue that opportunity is an appropri-
ate decision.

4 Brand-Centric Transformation
 • Understand the emotional governing the transformation, which
expectations of a hotel experience includes some 25 initiatives across all
customer touch points. Management
• Determine which emotional has presented the plan to its franchi-
expectations the Hilton brand sees around the world, gaining strong
could and should try to own buy-in.

• Determine which product and Culture-building efforts have been

service elements the brand critical to helping align everyone at
needed to deliver to meet these Hilton around delivering the brand
emotional expectations promise. They take advantage of the
power of social networks to get the
• Develop a plan to execute the new word out internally—for example, via
elements around the world, an online community where employ-
balancing consistency with ees share service stories, ideas, and
individual country needs best practices and participate in
surveys. “Culture cabinets” drive
• Mobilize the organization, with a brand values all the way down to the
strong call to action and data to local level, now in 76 countries and
support the changes 540 properties.

Today, Hilton has a new global brand In two or three years, Hilton expects
positioning and a coherent brand- that it will stand not for “once upon a
transformation plan. A central time” but for “relevant” and “the
program-management office is future.”

The brand is not a separate entity. The “brand” cannot be owned solely by
the marketing organization and its advertising agency partners but must instead
be embedded in the line business. To ensure buy-in and successful execution,
brand-related decisions need to be sold to the entire organization—including the
sales force, field operations, and franchisees—through systematic and consistent
internal brand-building. Brand managers are left with a tricky dilemma: how to
balance the needs of the many various constituents across the company, over both
the short and long term, without compromising the immutable tenets of the
brand.

The brand is a moving target. Because technology, consumer needs, and business
models evolve at a rapid pace, any brand must continuously adapt its current
positioning in order to remain relevant. While consumers’ emotional needs may
stay constant, the product attributes underlying them probably will not. Consider a
brand in the food category seeking to help mothers feel virtuous about feeding
their children. The product attributes required for the brand to deliver on that
emotional need might shift from “low fat” to “all natural” to “organic” as consumer
trends evolve.

The Boston Consulting Group 5

 The brand balances art and data. Making the right tradeoffs about where to
invest and where not to invest requires data from well-designed quantitative
market research and economic analysis to answer the following questions: How
large and valuable are the different market spaces that the brand might occupy?
How many consumers will respond to a particular cluster of emotional needs?
What exactly is the relative consumer preference for each specific product attribute
or experience? What is the likely profit impact of various potential brand-invest-
ment options?

Understanding the Brand Benefit Ladder

A data-driven approach to brand transformation requires that executives first
understand what drives consumer choice in the product category and then translate
that understanding into the core elements of the brand. To accomplish this, we rely
on the “brand benefit ladder,” a tool commonly used by marketers to describe how
specific product benefits layer to support one another in delivering a brand experi-
ence to the consumer. (See Exhibit 1.)

Our basic brand benefit ladder includes the following elements:

• Technical attributes include physical characteristics of a product or service, such

as the ingredients, quality level, or aesthetics.

Exhibit 1 | The Brand Benefit Ladder Rises from Technical to Functional to Emotional Benefits
Illustrative example: Starbucks coffee

Feeling
sophisticated; Indulgent; taking time for oneself—
understanding investing a few minutes and a few Feeling
good quality dollars to give oneself a treat responsible
Emotional
benefits

Better tasting A special treat;

Functional (acquired) premium Relaxing Fair, ethical
benefits

Coffee
experts
Signature Espresso-
roasting based
beverages Health
Displays “The third insurance for
Technical Premium explaining the Hot place” part-time
attributes Higher Italian
pricing bean-to-coffee Coffee employees
process breaks
Arabica names
during the Eco-friendly,
beans Unique day Music
content coffees sustainable growing;
fair trade practices

Source: Illustrative example (not based on case experience); BCG analysis.

6 Brand-Centric Transformation
• Functional benefits describe differences in how the product or service features
are experienced and used by the consumer.

• Emotional benefits capture the feelings inspired by the product or service.

While technical attributes and functional benefits can vary between brands, they
are not sufficient on their own to provide sustainable brand differentiation; ulti-
mately, emotional benefits are the key to creating customer loyalty, preference, and
willingness to pay.

Some brand-ladder definitions will also incorporate a range of related “layers”—

such as social or self-expressive benefits—that add greater depth to the emotional
benefits near the top of the ladder. Social benefits, which convey the relationship
between the brand and the individual, the community, and the social context, are
increasingly important in today’s interconnected world. (See the sidebar “Social
Brand Benefits.”)

soCIAL BrANd BENEfITs

Have you noticed, at gatherings of The social layer becomes particularly
top-level company executives, a new relevant in today’s interconnected
accessory displayed on the hotel world of digital media, online com-
conference table atop the ubiquitous munities, and user-generated con-
notepad and pencil? often, it is tent. The iPad is a membership card
Apple’s iPad, a product that exempli- to an exclusive club of early adopt-
fies the concept of “social” brand ers—“first users” of the latest
benefits. technology and trends. similarly,
your Whole Foods tote bag shows
Emotional benefits—how it makes off your eco-conscious credentials.
you feel—are at the core of the brand. Your pair of Manolos signals that you
But within and around the emotional shop with the best of the fashion-
layer are many other layers to explore, istas.
including benefits from self-expres-
sion (who I am and who I aspire to social brand benefits affect not just
be) to values (what I stand for and how you feel inside but also how
what matters most in my life) to others perceive you, and with whom
social (what group I am a part of you can connect. Are they on your
and how I relate to society and to brand’s benefit ladder?
others).

Every successful brand has a brand benefit ladder that is relevant, differentiated,
and fully experienced by the consumer. For example, travelers on Southwest
Airlines feel thrifty and savvy because of rock-bottom ticket prices and no-frills
service offerings delivered by high-energy employees. BMW owners feel proud to
drive a superior performance vehicle grounded in German engineering. Starbucks
customers feel indulgent when they consume the company’s high-end Arabica
coffee beans.

The Boston Consulting Group 7

 But simply using the brand ladder as a tool in brand strategy efforts doesn’t prevent
suboptimal branding decisions. Unfortunately, marketers tend to stop at the emo-
tional layer of the brand ladder and do not apply the necessary rigor in quantifying
and fully understanding the links between the technical, functional, and emotional
layers. In many cases, they also fail to use hard data to measure the value of poten-
tial brand investments and to prioritize tradeoffs. Finally, they struggle to implement
the resulting brand-ladder elements and hold the organization accountable.

Why is the implementation of a new brand strategy so difficult? In many cases, one
part of the organization owns the emotional benefits while other parts manage the
functional benefits and technical attributes. These groups may not interact very
frequently, and their key performance indicators (KPIs) are typically misaligned.
Often, each group is evaluated and compensated on the basis of technical attributes
The optimal approach that are irrelevant to, or even negatively correlated with, the emotional benefits
to brand transforma- that they are meant to support.
tion is both creative
and disciplined. It Emotional benefits are typically owned by the marketing organization and external
shapes what the advertising agencies—passionate brand gurus who may envision their role more as
company is (and is an art than a science. They may focus mainly on developing catchy messaging and
not) permitted to do. gloss over the fundamentals of the product and customer experience. What’s more,
they may fail to incorporate business metrics or opportunity sizing into their
recommendations.

Meanwhile, technical attributes and functional benefits are often controlled by an

entirely different set of company departments. Product development, pricing,
merchandising, field operations, and real estate, for example, may each oversee
different aspects of the product or service features. These departments often make
day-to-day decisions and tradeoffs independently, without considering the brand
promise. Ultimately, coordination across these teams on any holistic brand-transfor-
mation effort becomes a massive undertaking.

A Four-Step Solution
The optimal approach to brand transformation ties together the drivers of brand
choice, the brand benefit ladder, and the company strategy—and is grounded in
deep consumer insight, including both qualitative and quantitative analysis. It
conveys the product’s technical, functional, and emotional benefits in a globally
meaningful way. It ensures a consistently delivered experience using “brand driv-
ers” across all the marketing “P’s”—such as placement, promotion, and people. It
touches all parts of the organization to ensure buy-in and commitment. It is both
creative and disciplined. It shapes what the company is (and is not) permitted to
do, and can be measured and tracked over time.

Based on our work in brand transformation with leading companies worldwide, we

recommend a four-step methodology that quantitatively links the brand ladder to
brand strategy and then enables the organization to translate strategy into reality.

Step One: Identify the Drivers of Brand Choice

The first stage of the process explores how consumers might choose between

8 Brand-Centric Transformation
different brands within a product category. Choice drivers are never entirely ratio-
nal. While practical matters such as price or ingredients matter, the final purchase
decision more often than not also reflects emotional positioning clusters: essentially,
collections of feelings that consumers might have when experiencing the category.
For example, the emotional positioning clusters for a particular type of retail store
might include a “relaxing escape” untroubled by the busy world outside, or a
“sensible” feeling of having made good use of one’s time and money, or a “hip and
in the know” sense of access to new trends that most people don’t have, or a
“hassle-free” confidence in always being able to find a desired item.

Choice drivers will naturally differ by occasion, location, or life stage: business
travel versus leisure travel, restaurant meals versus eating at home, clothing for
young children versus teen apparel. The category landscape is divided into a large
number of “market spaces” created by the intersection of emotional positioning
clusters with occasions, locations, and life stages. (See Exhibit 2.)

Because the consumer sits at the heart of brand-centric transformation, so does

exhaustive consumer research. Qualitative consumer research leads the way to
identifying the different drivers of choice in the product category as well as the

Exhibit 2 | Create the Map of Emotions and Market Spaces

Life stage

Gender Male Male Male Male Female Female Female Female

Age 24–44 24–44 45+ 45+ 24–44 24–44 45+ 45+
Income <$100K >$100K <$100K >$100K <$100K >$100K <$100K >$100K Total (%)
At peace 15
Sharp and focused 5
Comfortable 10
Sense of pride 10
Out
of home Splurging on me 5
Hip and in the know 5
Personally connected 10
Emotional Family friendly 3
positioning At peace 10
by occasion
Sharp and focused 0
Comfortable 0
Sense of pride 5
In
home Splurging on me 7
Hip and in the know 5
Personally connected 2
Family friendly 8
Total (%) 20 10 15 20 10 5 10 10 100

Share of total spending

on product category (%) >1.5 1.0–1.5 0.5–1.0 <0.5

Sources: Illustrative example; BCG consumer research; BCG analysis.

Note: Numbers in shaded boxes are percentages of respondents classified on the basis of their top two emotional benefits (using MaxDiff
analysis).

The Boston Consulting Group 9

entire universe of emotional positioning clusters—both current and potential.
Combining this research with other data sources, such as a detailed assessment of
the competitive landscape, executives can build a comprehensive view of all the
possible market spaces and potential brand benefits for the category. The result is a
holistic perspective of the company’s competitive brand positioning.

While the qualitative research can help define the universe, its role is primarily as
an input to inform hypotheses. The ultimate goal is to develop a very focused,
specific, and efficient large-scale quantitative survey of consumers to prove or
disprove those hypotheses. This quantitative research should then leverage multi-
ple analytical techniques to identify emotional positioning clusters overall and by
market space. (See the sidebar “Data-Driven Insight: BCG’s MindDiscovery and
More.”)

The specific methodology should be adapted to a particular company’s unique

situation, but it will typically include analytical research techniques that make it

dATA-drIvEN INsIGHT
BCG’s minddiscovery and more

our consumer-research program rational exercises, it can also build

begins with a qualitative phase, hypotheses about how functional and
seeking a comprehensive list of technical elements can deliver on an
positioning options and market emotional promise.
spaces that are owned, or could be
owned, by a particular brand. Depend- The initial qualitative exploration
ing on category dynamics, this phase arms us with a comprehensive set of
may incorporate in-context interviews, emotional, functional, and technical
in-depth one-on-one interviews, or dimensions in addition to market
focus groups. spaces. We can then evaluate these
using large-scale surveys (with sample
It could also incorporate MindDiscov- sizes of at least 1,500). Respondent
ery, a proprietary approach developed specifications and sampling methods
by BCG’s Center for Consumer Insight vary by product category.
featuring consumer workshops that
make extensive use of psychologically Our surveys typically include at least
derived projective techniques. The three core sections: sizing, prioritiza-
diversity of stimuli and forms of tion, and brand health.
expression helps alleviate many
shortcomings of traditional focus • Sizing. Questions that size poten-
groups. MindDiscovery avoids the tial emotional-positioning clusters
limits of verbal expression, lowers and market spaces can be
social barriers, maintains a spectrum anchored on consumer segments,
of views, and fosters creativity. It is usage occasions, or any key
particularly powerful for research on dimension of value in the market
emotional aspirations. However, by (such as the percentage of meals
combining creative stimuli with consumed or the number of cars

10 Brand-Centric Transformation
possible to prioritize individual attributes, highlight key relationships among
attributes and benefits, and cluster similar drivers of brand choice.

Step Two: Select the Market Space and Emotional Positioning

Clusters to Target
With a full understanding of the universe established, the next step involves
selecting the market spaces that are most attractive and feasible for the brand to
target and own. The goal is to identify specific opportunities that are financially
attractive and also available to capture. Ideally, these are “white spaces” (not
already owned by any existing brand) or are adjacent to where the company’s
brand currently plays. (See Exhibit 3.)

To achieve this goal, the company must know how consumers of its existing
brand—and of the product category more broadly—are arrayed relative to the
market spaces and how the spaces compare in size. In describing the spaces, there
may be many relevant considerations: who the specific customers are, where they

purchased in the past year). We current state of a company’s

then calibrate the results to brand to other brands in the
external market data in order to product category by examining
evaluate the financial value of the category-wide brand associations
spaces for the brand. with each element of the brand
ladder. We can see how well (or
• Prioritization. The heart of the poorly) positioned a brand is for a
survey, this lengthy section particular emotional-positioning
explores consumer expectations cluster or market space, and
across the brand ladder. We find identify open-space opportunities
maximum difference scaling or areas of vulnerability to
(maxdiff ) to be the optimal tool competitive threats.
for prioritizing emotional and
functional benefits. It allows for Post-survey analysis leverages a series
paired comparisons between all of statistical tools. For example,
attributes tested and thus uncov- finding emotional-positioning clusters
ers critical tradeoffs. for example, requires hierarchical Bayes analysis
auto buyers may trade off “being for maxdiff scores, reduced by factor
worry free” against having the analysis. Brand association is ex-
newest trendy car. Additional tech- plored through a modified chi-square
niques (such as Kano modeling, test. Establishing links between
traditional Likert scales, or con- emotional, functional, and technical
cept testing) can complement the statements may involve correlation
analysis of technical attributes. analysis, t-tests, and regressions, or it
may require more “black box”
• Brand Health. This section of the methods such as structural equation
survey is designed to compare the modeling and driver analysis.

The Boston Consulting Group 11

Exhibit 3 | Evaluate Investment Decisions and Actions from the Brand's Starting Point
Map of brand association (consumer perception), indexed share of wallet (consumer behavior), and market size

Share opportunities Strengths

• Leverage brand association to build share • Protect and strengthen position
High

Personally connected Sharp and focused

Sense of
accomplishment
Concept Hip and in the know
brand
association1 Heavy investment required Vulnerabilities
• Build association only if attractive • Preserve share by strengthening association
• Concede to competitors if negatively
correlated with leadership space

Family friendly
At peace Splurging on me
Low
Comfortable
Low High
2
Share of wallet
Represents market size
Source: Illustrative example; BCG analysis.
1
The extent to which consumers report that they associate your brand with a potential positioning concept (based on market research).
2
Indexed share of consumer wallet (purchases, visits, spending) relative to the competition.

live, and what their usage occasions are. Market sizing is critical, in terms of not
only the customer base but also dollars. For example, an emotional positioning
cluster centered on “smart and practical” might appeal to a large number of
customers who spend sparingly, while “local community” might appeal to a smaller
number of customers who spend liberally. Once again, this step is heavily driven by
analytics. Large-scale quantitative survey results determine the size of each market
space and then identify which spaces enhance one another and which do not.

Size is not the only factor in selecting the right market space; it is also important to
know where your brand has a competitive advantage. Researchers can ask consum-
ers to assess which brands and companies are currently winning in each market
space and to pinpoint spaces in which the company’s brand is strongest today. This
can be more complex than it sounds, especially if various divisions of your compa-
ny—or markets in which you operate—have different starting points.

For example, while crafting a new “umbrella” brand positioning, senior managers
at a global airline alliance realized that in their particular case they needed to
develop functional, emotional, and social brand benefits that were not just relevant
but also realistic. They had to mirror the capabilities of all the partnering airlines,
so that any shared brand promise could be implemented across the entire alli-
ance—while at the same time fully building on the uniqueness of the individual
airlines. The decision by the airline alliance to consider the delivery constraints

12 Brand-Centric Transformation
early in the brand transformation process also proved to be critically important to
successful execution over time.

Step Three: Identify the Brand Ladder Requirements to Win

Now it’s time to build the brand benefit ladder, starting with the market space and
the critical emotional benefits and then centering every other element of the
ladder on that starting point. To effectively target the chosen emotional benefits,
executives must link each one to the corresponding functional benefits or technical
attributes that will make it real for the consumer. Research and analytics can
help establish these links with quantitative precision rather than instinct and
guesswork.

This round of analysis quantifies the importance of each functional benefit to

delivering the emotional benefits, and identifies the role of each technical attribute
in driving the functional benefits. Links across the ladder match each benefit
precisely.

Armed with a prioritized list of technical attributes and functional benefits, along
with key tradeoffs, executives can compare the list to their current product or
service offering—and will likely find critical gaps. A competitive view is also a
critical factor in building the full brand ladder, because efforts to address these gaps
may run straight up against a competitor’s superior offering and capabilities. In
Europe, for example, Audi’s Quattro four-wheel drive system so thoroughly defines
that space that there is little room for other carmakers to claim similar territory.

Next, executives must make final brand-investment decisions. On the basis of the
detailed analytics undertaken in the previous stages, executives can demonstrate
the financial value of delivering each layer of the brand ladder. (See Exhibit 4.) As a
result, guidelines on how much to spend on brand reinvention, and when to stop
spending, are much clearer.

Step Four: Develop the Brand Execution Strategy and Playbook

This final step of the program centers on aligning the organization (as it is config-
ured today) around the new brand. Senior executives must translate the brand
positioning into something that can be communicated, digested, understood, and Each relevant func-
acted on by all employees at all times. Each relevant function of the organization tion of the organiza-
needs an action plan for internal execution, converging to create the integrated tion needs an action
brand ecosystem for the customer to experience. plan for internal
execution, converging
With a detailed definition of the target market space and brand ladder elements in to create the integrat-
hand, company executives may now develop an adaptive framework to manage ed brand ecosystem
and align the entire business, connecting the brand ladder to the overall strategy. for the customer to
They must define everything from brand essence (the heart and soul of the brand) to experience.
brand pillars (themes that group the key attributes of the brand ladder) to brand
drivers (individual technical attributes required to execute the brand through the
day-to-day operations of the business).

The output of this stage is a detailed implementation plan across the whole organi-
zation—from marketing to operations. (See the sidebar “Brand Drivers in the

The Boston Consulting Group 13

 Exhibit 4 | Owning the Entire Brand Benefit Ladder Delivers Greater
Financial Upside
Expected improvement in brand opinion and price premium
1
Level of ownership of brand benefits

Current state 36

+13 +$2
Full ownership of
technical attributes 49

+25 +$8
Full ownership of
74
functional benefits
+26 +$17
Full ownership of
100
emotional benefits
0 20 40 60 80 100
2
Favorable brand opinion (%)

Expected cumulative price premium per unit of product

Sources: Illustrative example; BCG analysis.
1
Proportion of consumers who associate the brand with the specific benefit, such as quality, convenience, or
affordability.
2
Proportion of consumers who say that this is their preferred brand.

Driver’s Seat.”) The operational plans ensure that each and every customer-facing
decision is aligned with the new brand positioning. Best practice here is to apply
the brand framework to each of the “P’s,” going well beyond the narrowly defined
four P’s of marketing—product (design and innovation), price, placement (distribu-
tion), and promotion (advertising, discount strategy, and public relations)—to the
extended marketing-mix P’s, which include people (from store associates to call-
center staff ) and processes (such as sales and service approaches).

In conjunction with advertising and public-relations agencies, marketing executives

should develop communication plans that align consumer advertising programs
with the new emotional benefits and brand positioning. Talented creative agencies
add tremendous value in bringing alive the insights of the brand ladder with
carefully selected words and imagery. Importantly, the creative-development efforts
should take place near the end, rather than at the beginning, of the brand transfor-
mation effort.

Equally important, external communication alone is not sufficient to drive brand

transformation. Executives must also convey a thorough understanding of the new
positioning within the company, so that the brand essence can help align all inter-
nal and frontline functions around a unified vision of the brand. When a company
has established effective “brand mirroring,” each employee experiences and
describes the brand in exactly the same way that the customer does.

How to do this? One travel company created a community website for its internal
staff, where the global brand head could communicate his perspective on the

14 Brand-Centric Transformation
 BrANd drIvErs IN THE drIvEr’s sEAT
A European carmaker was proud of its reaching the final destination
history of success and its brand depended on the next phase: translat-
heritage, but the company had begun ing the new brand-value proposition
underperforming in the market. into specific execution steps. The
Brand equity metrics—such as the management team analyzed all
percent of consumers “considering” brand drivers and customer touch
purchase—showed some deteriora- points in the context of internal data
tion in consumer perception of the and external best practices. They
brand. Determined to improve, the identified the key drivers of a unique
company embarked on a journey to customer experience, which were
recapture the brand’s emotional then executed not just in marketing
appeal and increase market share. communications but also across the
various functions of the company.
The initial stages of the journey were
aimed at defining a new brand-value To align the organization around the
proposition. Managers undertook a new brand, one critical element was
detailed audit of the brand’s current the development of a brand book. This
positioning, gathered qualitative book explained all the elements of
insights, and quantitatively validated the new brand personality, such as
the positioning options before the brand promise and the core
selecting and refining a winning attributes at each step of the brand
concept. ladder. It defined the strategic brand
objectives and described the influence
At this point, the team had defined an of the new brand on communication.
emotionally relevant brand identity
and carved out the client’s differentia- Today, the company has successfully
tion against core competitors. The implemented its brand repositioning
customer-driven and fact-based and is enjoying the results: an
approach convinced senior managers improvement in brand consideration
(some of whom had previously viewed of approximately 5 percentage points
branding as a “soft” topic) to support and an increase in market share of
a new strategy. more than 1 percentage point.

brand and employees could share their own brand stories. The site design took its
cues from the world of social media—part Facebook and Twitter, part YouTube,
and part e-learning. At each of the company’s locations around the world, senior
management nominated one person to be the steward for culture (and to facilitate
and oversee use of the website). The website has achieved impressive participation
rates, boosting employee engagement and facilitating change management.

In this final stage, executives should also develop an organizational plan that aligns
brand standards around the brand pillars, which are then strictly enforced across
every function. Training programs and compensation schemes may need to be
overhauled accordingly. For example, one specialty retailer sought to shift its brand
to a more sophisticated, upscale positioning. Changes in the products, packaging,

The Boston Consulting Group 15

 and signage in the stores were a good start—but real change required that the
company also educate the store associates to become advisors and product special-
ists with a much more technical knowledge of the category.

A brand-centric transformation program can improve all aspects of brand delivery—

from strategy, repositioning, and execution to organization and capabilities. In
BCG’s holistic approach to brand value creation, companies must also track brand
impact—measuring brand equity, valuing the brand, and building brand reporting
systems. Such systems should capture and track internal and external KPIs that
enable executives to show how brand metrics are directly tied to the financial
performance of the company and to demonstrate the brand’s relationship to
company valuation. We recommend designing a highly targeted set of metrics and
KPIs aligned with the brand essence and pillars. Management can then review a
focused brand scorecard to manage performance along those KPIs and not become
overwhelmed by a laundry list of issues. (See Exhibit 5.)

It goes without saying that to accomplish all of the above, the branding organiza-
tion must have senior-level leadership and commitment, as well as the underlying
capabilities to successfully execute any ambitious transformation program.

Brand-Centric Transformation at Work

We have seen our approach successfully applied in a range of consumer-facing
businesses, from travel to automotive to retail to consumer packaged goods. Compa-

Exhibit 5 | A Brand Scorecard Helps Track Progress over Time

Track key customer metrics ...then identify how customer metrics

annually and versus peers... link to performance for each brand driver

Peer
Year 1 Year 2 group
score score score
Brand
Loyalty 14 16 17 promise
1 Brand
driver 1
Purchase 17 17 20 On-time delivery
Brand equity
• Loyalty Brand
Brand
Preference 23 22 32 • Purchase promise driver 2
• Preference 2 Best-in-class
• Consideration customer Friendliness
Consideration 55 55 52 • Awareness service
Brand
Brand driver 3
Awareness 86 88 80 promise Responsiveness
3

Relative performance
Positive Neutral Negative

Sources: Illustrative example; BCG analysis.

Note: Brand equity scores are derived from annual brand awareness and usage surveys tracking consumer responses to brands and competition;
brand promise and driver performance would be derived from internal company sources.

16 Brand-Centric Transformation
nies with poor brand performance, companies facing disruptive transformation in
their industry, and companies forced to make tradeoffs because of high capital-
investment requirements can all benefit from our model of brand transformation.
(See the sidebar “Does Your Organization Need Brand-Centric Transformation?”)

The approach is flexible and can be tailored across industry sectors to a particular
company’s situation and needs, subject to a few core principles that must remain
constant:

• Balance the creative and the analytical by aligning and sequencing qualitative
and quantitative research.

doEs Your orGANIzATIoN NEEd BrANd-

CENTrIC TrANsformATIoN?
If your company’s situation matches ...a brand-centric transformation
any of the scenarios below,... effort may be effective for you.

1. If your industry is experiencing a …this approach may help your

disruptive transformation, such as company identify unique “white
new technologies, high levels of space” (unoccupied) positions for
competition, or significant your brand that are protected from
innovation,… turbulence and attack.
2. If your brand is in a mature cat- …this approach is likely to be very
egory (or a new category analo- applicable, because consumers are
gous to a mature category),… inclined to build emotional connec-
tions in familiar categories.
3. If your brand is performing poorly …this approach can provide
with consumers and in need of a differentiated positioning and guide
turnaround,… tighter messaging.
4. If you provide a complex product …this approach can help prioritize
or service, with multiple customer product attributes at each touch
touch points and offerings,… point to ensure a consistent delivery
of the brand experience.
5. If your business is capital inten- …this approach will provide specific
sive, with high spending require- tradeoffs and priorities to guide
ments,… more accurate investment decisions.
6. If your senior management ….this approach is more likely to
makes decisions on the basis of work well because it relies on heavy
rigorous analysis and is commit- quantitative analysis (although it
ted and open to change,… may conflict with marketers’
anecdotal data or “gut feel”).
7. If your company has attempted to …this approach may address some
reposition the brand before with of the shortcomings that hampered
little success,… previous efforts.

The Boston Consulting Group 17

• Focus on the entire brand ladder—technical, functional, and emotional benefits,
and social benefits as applicable.

• Use robust data and rigorous analysis to make tradeoffs among technical
product attributes on the basis of the selected market space.

• Link the quantitative brand ladder directly to the development of the brand
strategy and execution plan.

• Develop consumer-facing, emotional imagery and messaging at the right

time—after the facts have been laid out and the strategy has been developed.

• Touch all parts of the organization, in both strategy development and the
implementation phase.

M any of the concepts described here—from the brand benefit ladder to the
marketing P’s—are already well known to brand managers. When taken as a
whole, however, our approach addresses common shortcomings in traditional
brand-transformation efforts. Fundamentally, it is anchored in the emotional
elements that can drive price premiums and competitive advantage. But rather
than stopping at the emotional layer of the brand ladder, our approach ensures
tight and quantified links between every layer. Rather than relying on gut feel, it
rigorously establishes the financial value of every investment tradeoff. And rather
than consigning the brand to a marketing silo, it weaves the brand into the very
fabric of the organization, thereby bringing the brand to life.

In today’s marketing landscape, the basics of brand management may seem obso-
lete compared with the latest digital tools and trends. But some things never go out
of style. Company executives must reject complacency, rethink old ways of tackling
brand issues, and apply a new, more disciplined approach. The result will be a
brand-centric transformation that goes well beyond messaging and “the creative”
to strengthen every aspect of the business.

18 Brand-Centric Transformation
About the Authors
Dylan Bolden is a partner and managing director in the dallas office of The Boston Consulting
Group. You may contact him by e-mail at [email protected].

Antonella Mei-Pochtler is a senior partner and managing director in the firm’s vienna office. You
may contact her by e-mail at [email protected].

Rohan Sajdeh is a partner and managing director in BCG’s Chicago office. You may contact him
by e-mail at [email protected].

Gaby Barrios is a consultant in the firm’s Boston office and an expert in BCG’s Center for Con-
sumer Insight. You may contact her by e-mail at [email protected].

Erin George is a principal in BCG’s dallas office. You may contact her by e-mail at george.erin@
bcg.com.

Keith Melker is a principal in the firm’s dallas office. You may contact him by e-mail at
[email protected].

Deran Taskiran is a principal in BCG’s Istanbul office. You may contact her by e-mail at
[email protected].

Acknowledgments
The authors would like to acknowledge the valuable contributions of Lars Blinda and manfred
Dederl. Megan Findley, Kim Friedman, and Janice Willett provided writing, editorial, and production
support.

For Further Contact

If you would like to discuss this report, please contact one of the authors.

The Boston Consulting Group 19

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