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Have you ever begun working on a business and discovered numerous products/services in your portfolio? So many that it’s not clear why you’re selling some of them at all?
You are not alone.
As a consultant, I received numerous calls from clients asking for help in understanding and defining what should be in or out of their portfolios.
Defining the strategic brand architecture (a.k.a., portfolio structure) is one of the foundational exercises that all businesses should conduct.
Strategic brand architecture is different from design architecture (read more about the different types of brand architecture). Strategic brand architecture is a framework that defines the portfolio of offerings, outlining how products/services relate to and differ from each other. Properly written, it explains why each product/service exists from a both customer/consumer and business perspective.
Strategic brand architecture helps you decide which offerings do or don’t build your brand equity.
Note: Before you proceed with architecture work, you may want to establish a firm brand positioning. The architecture then outlines how you deliver that positioning. For more information on brand positioning, check out the Ultimate Guide to Writing a Brand Positioning Statement.
BRAND ARCHITECTURE 101—PORTFOLIO STRUCTURE
The strategic brand architecture is laid out in a matrix, with columns (a.k.a., pillars) for each product line/sub-brand and rows for each defining characteristic. While the starting point for writing up a pillar is often a current product line, additional pillars can be written for unmet customer needs or potential business strategies.
Well-written strategic brand architectures typically have the following seven defining characteristics as part of the matrix:
- Target Audience
- Consumer/Customer Need
- Strategic Role
- Business Opportunity
- Competitive Frame of Reference
- Technical/Point of Difference
- Product/Service Lineup
Here I’ll use Gatorade’s Endurance Carb Energy (CE) as an example to illustrate each one. This example is inferred from publicly available Gatorade brand communications.
1) TARGET AUDIENCE
The target audience is whom, specifically, the product is designed for. Who’s need does this product/service meet? Who is most likely to be compelled by this offering? If your brand has conducted segmentation research, you may choose to place in the segment name. Related article: 7 Characteristics to Define Your Marketing Target
For Gatorade Endurance CE: serious athletes competing in endurance competitions such as marathons, triathlons and long-distance races.
2) CONSUMER/CUSTOMER NEED
What need does the offering provide to the target audience? The need can be functional or emotional. Think about the problem or tension for which your product/service solves. What specific desire does the offering satisfy?
For Gatorade Endurance CE: a steady supply of muscle energy over longer periods of time.
3) STRATEGIC ROLE
The strategic role captures the essence of the business reason that the offering exists. How does the offering build equity for the brand? Examples include increasing penetration, trade-up, establishing expertise, category leadership, domain (category) expansion, target expansion, etc.
For Gatorade Endurance CE: establish technical leadership position at the highest levels of competition.
4) BUSINESS OPPORTUNITY
While the strategic role is how the offering builds brand equity, the business opportunity is what the business receives as a result. Examples include volume, revenue, profit/margins, market share, cost efficiencies, etc.
For Gatorade Endurance CE: margin enhancement.
5) COMPETITIVE FRAME OF REFERENCE
Here you’ll define the competitive set. Most brand architectures will list the literal competitive set (the specific product category you sell). Think about the brands you directly compete with as well as competitive substitutes.
Gatorade’s traditional literal competitive frame is sports drinks (hypotonic, isotonic and hypertonic beverages). In recent years, the brand has expanded its competitive set to include chews, bars and durable products. Gatorade now refers to itself as a “sports fuel company.”
In the brand architecture pillar, use the competitive frame specific to that pillar (usually a subset of the brand’s overall competitive frame).
For Gatorade Endurance CE: energy foods and beverages.
6) TECHNICAL/POINT OF DIFFERENCE
Functional support is included for each pillar. This includes key reasons to believe (RTBs) and/or technical points of difference that make your product/service superior to the competition.
For Gatorade Endurance CE: 30+ grams of carbohydrates plus B vitamins to help convert carbs into fuel that muscles can readily use.
7) PRODUCT/SERVICE LINEUP
Your last task is to slot in the actual product/service name (or image) that ties the above strategy to what your business sells in market. It can be as simple as a list of offerings, formats, or product shots.
For Gatorade Endurance CE: carb energy chew, carb energy drink.
A STRATEGIC BRAND ARCHITECTURE TEMPLATE TO GET STARTED
In totality, the strategic brand architecture makes it clear why every offering exists, and how the offerings differ from each other and competition. This helps to optimize portfolios and frame up how potential future offerings can continue to build the business. Continue to evolve the portfolio structure over time as the consumer/customer, marketplace and competitive environment changes.
To make it easy for you to get a quick start, you can download a strategic brand architecture template below that includes the Gatorade pillar example from this article. Start by filling in your current portfolio. Perhaps it will help you sharpen your strategy and identify areas for optimization.
You might also like:
- Ultimate Guide to Writing a Brand Positioning Statement
- Ultimate Guide to Writing a Creative Brief
- How 3 Established Consumer Brands Unlocked New Growth
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Kevin Namaky is CEO at the Gurulocity Brand Management Institute, a marketing education company that trains and consults for notable brand teams including Kimberly-Clark, Scotts Miracle-Gro, Bolthouse Farms and Gorilla Brands. Kevin is a featured instructor for the American Marketing Association, lectures at the IU Kelley School of business, and has been featured in Ad Age, Forbes, Fast Company and the CMO Council. Previously Kevin worked for 20 years in the corporate and agency world growing notable brands. Follow Kevin on LinkedIn.