INTEGRATION OF BRAND VULNERABILITY SCENARIOS

ECONOMICS AND MANAGEMENT: 2013. 18 (3)
ISSN 2029-9338 (ONLINE)
INTEGRATION OF BRAND VULNERABILITY SCENARIOS
PLANNING INTO BRAND MANAGEMENT PROCESS
Vestina Vainauskiene1, Rimgaile Vaitkiene2
1,2
Kaunas University of Technology, Lithuania
http://dx.doi.org/10.5755/j01.em.18.3.4234
Abstract
Modern brands function in the markets distinguishing in uncertainty. In the context of
uncertainty organizations face difficulties in making strategic and tactical decisions because it is
impossible to forecast future tendencies. Organizations’ decisions, external environment factors
and competitors’ actions determine brand vulnerability. Brand vulnerability is the premise for the
formation of brand risk. In the context of the later trends problematic question arises for academics
and practitioners: how to manage the brand so that the brand vulnerability would be decreased to
the minimum?
Considering the fact that scientific literature does not give the answer to this question, the
aim of the paper is to integrate the planning process of the brand vulnerability scenario into the
brand management process. In order to do the mentioned, the following objectives of the paper are
set: to present the concept and the planning process of the brand scenarios, to discuss the
opportunities of integration of the brand scenario planning process into the brand management
process.
The type of the article: Theoretical article.
Keywords: uncertainty, vulnerability, brand management, scenarios.
JEL Classification: M10, M31.
1. Introduction
The world we live in is far more complex today than it was just a few years ago because of a
feverish and fascinating process of perpetual change. New technologies bursting onto the scene,
social networks undergoing extraordinary growth and expansion, huge amounts of information
becoming available to consumers, the globalisation of the economy and the accelerated
development of the so-called emerging countries (Iglesias, Singh & Casabayo, 2011), the rise of the
shopper, markets and media fragmentation, choice economy, power of communities (Kapferer,
2008) are some of the main phenomena that are changing the image of the competitive environment
in which brands operate, which, in turn, is posing stiff challenges for brand management. The latter
tendencies form the feature of market uncertainty. The uncertainty is the key dimension
characterizing contemporary external environment (Oreja-Rodrı´guez & Yanes-Este´vez, 2007;
Ebrahimi, 2000). Further, it outlines the ambiguity of the results of different organization’s factors
performed in the contexts of unpredictable situation not possessing necessary information (Herzig
& Jimmieson, 2006; Ebrahimi, 2000; Wilson, 2009). Hence, in order to make management
decisions for a brand, organizations face difficulties while following heavily predictable future
tendencies. Inappropriate decisions, while made in case of unclear future tendencies are among the
main reasons reducing a brand. In other words, the brand, when functioning in the environments
characterized by uncertainty, has become the vulnerable asset of an organization. In a broad sense
vulnerability is defined as exposure to welfare losses (Vatsa, 2004).
To retain the value of a brand is the most important for an organization managing a brand,
since the brand equity is the essential premise determining customer loyalty to the brand. Loyal
customers ensure increasing income and strong position of the brand in the market – i.e. it forms the
brand equity for an organization. In the context of the brand management it may be stated that the
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INTEGRATION OF BRAND VULNERABILITY SCENARIOS
PLANNING INTO BRAND MANAGEMENT PROCESS
brand vulnerability is an internal feature of the brand allowing different factors to potentially
negatively influence customer loyalty for the brand (Vainauskiene & Vaitkiene: 2012; Vaitkiene &
Vainauskiene, 2010).
In the context of uncertainty, an organization shall predict factors that negatively affect
constituents of brand equity and to make proactive decisions in order to minimise the influence of
the mentioned factors to the formation of brand vulnerability. Based on the market forces that affect
the brand lifecycle, distinguished by Doyle and Stern (2006), it can be claimed that brand
vulnerability is potentially caused by the following trend-groups of external environment:
consumers, competitors and new market entrants.
The tool of a strategic thinking, i.e. approach of planning scenarios, is widely used in the
theory of a strategic management of an organization. According to Fink, Siebe & Kuhle (2004), the
planning of scenarios is the most common used approach in order to fight against the uncertainty.
On of the main goals of scenarios planning approaches is to develop integrated and elaborated
pictures of the future (Mietzner & Reger, 2005; Fink, Siebe & Kuhle, 2004).
Based on the above mentioned characteristics of approach for scenarios’ planning, it may be
stated that such approach is appropriate in order to foresight the vulnerability of a brand. However,
in order to adapt the methodical provisions of scenarios’ method in identifying the brand
vulnerability, it is important to conceptualise the process of planning brand vulnerability scenarios
and integrate the activities of this process into the process of brand management. Brand
vulnerability is yet a new and undeveloped topic in scientific literature. Authors begin to analyse the
types of brand risks (Logman, 2007; Martinez ir Chernatony, 2004; Esch et al.; Wilcox et al., 2008)
failing to assess the theoretical provision that the risk formation assumption is vulnerability.
Therefore, it is important to provide an integrated process of scenarios’ planning in pursuit of
methodical unity in brand vulnerability since only then a sustainability of a proactive reaction
towards the brand vulnerability will be ensured.
Objective of the research: to integrate the planning process of the brand vulnerability into the
brand management process.
Tasks of the research:
1. To discuss scenarios’ method as a tool to foresight brand vulnerability
2. To discuss the opportunities of integration of brand scenarios’ planning process into the
brand management process.
Methods of the research: systematic analysis of scientific literature and comparative analysis.
Systematic analysis of scientific publications and comparison of the key theoretical provisions
allowed to reveal the conception of brand vulnerability scenarios and to identify the basic stages of
their development, as well as to detect the opportunities to integrate the process of planning brand
vulnerability scenarios into the process of brand management.
2. Approach of planning scenarios as the tool for foresight brand vulnerability
An organization seeking to react towards the brand vulnerability proactively requires a tool
assisting to predict the future tendencies of an external environment. Despite the theoretical and
practical relevance of the problem, the mentioned tool is not provided in the scientific literature.
Meanwhile the approach for developing scenarios is successfully used within the context of the
strategic management of an organization, which assists evaluating future uncertainties and
anticipating decisions as well as strategies (Schomaker, 1995; Johnston, Gilmore & Carson, 2008;
Millet, 2003). The approach for developing scenarios could be the tool assisting to react to brand
vulnerability.
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Table 1. The concept of brand vulnerability scenarios
Authors
Scenario concept
Fahey & Randall (1998)
A projection of potential future
Piirainen, Kortelainen, Elfvengren A set of separate, logical paths of
ir Tuominen (2010)
development, which lead from the present
to a defined state in the future.
Becker (1989), Masum, Ranck &
Singer (2010)
Scenarios are plausible descriptions of
future
conditions with which the organization
could be
faced.
Schwab, Cerruti & von Reibnitz
(2003)
A scenario is an extensive and detailed
portrait of a possible future world.
Brand vulnerability
scenario concept
The brand vulnerability
scenarios are consistent
and explicated pictures of
the factors determining
the brand vulnerability,
which show how will
they determine the brand
vulnerability in future.
Porter (2004) (Ringland & Young, An internally consistent view of what the
2006)
future might turn out to be – not a forecast,
but one future outcome
Source: adapted by the authors with reference to Vainauskiene & Vaitkiene (2012)
Table 2. The brand vulnerability scenario planning process
Authors
von Reibnitz
Shwartz (Mietzner ir Reger,
2005)
Godet (1987; 2000)
Scenario planning process
1) Task analysis
2) External influence analysis
3) Projections
4) Consistency analysis
5) Scenario interpretation
6) Consequence analysis
1) Identify the focal issue or decision
2) Key forces in the local environment
3) Driving forces ranking by importance of
uncertainty
4) Selecting scenario logic’s
5) Fleshing out the scenario Implications
6) Selecting the leading indicators and signposts
1) The problem formulated
2) Key variables external-internal
3) The organization's strategic guidelines and
objectives identification of opportunities
4) Future hypotheses
5) Scenarios
Stages of the process of
Brand vulnerability
scenario planning
1. Foresight of brand
vulnerability
2. Brand vulnerability
decisions
3. Control of brand
vulnerability scenarios
Two important aspects for developing the brand vulnerability scenarios are provided in Table
1, i.e. the concept of the brand vulnerability and the process for developing brand vulnerability
scenarios. The mentioned theoretical aspects are developed based on scenarios’ developing theory.
As the Table 1 shows, most commonly used processes for developing scenarios in the scientific
literature do not possess any radically distinguishing aspects. Scenario developing processes
prepared by Swartz and Godet, as well as Reibnitz, cover four wide stages, i.e. identification of a
problem (an organization is seeking to solve by applying the approach for developing scenarios),
analysis of the external environment, development of scenarios and their linkage to the strategy of
an organization. The four distinguished stages of scenario developing were adapted to the process
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PLANNING INTO BRAND MANAGEMENT PROCESS
for developing brand vulnerability scenarios.
Based on division of stages of the scenario process made by Saurin, Ractliffe, Puybaraud
(2008) and Ractliffe, Krawczyk (2011), it can be claimed that in the first stage of brand
vulnerability scenario development, in order to foresight brand vulnerability, it is important to carry
out the analysis of the current brand equity, to identify global forces that potentially determine the
brand vulnerability, and then, to identify the trends of local markets forming in their context that
potentially determine the brand vulnerability in future. In the second stage of scenario planning, it is
recommended to identify the level of uncertainty of identified local market trends and the degree of
influence on brand vulnerability, to form brand vulnerability scenarios and review them. In the third
stage – the control of developed scenarios stage – it is important to choose the indicators that assist
at controlling the development of brand vulnerability scenarios.
It is important to notice that the scientific literature uses concepts of the scenario development
and the scenario planning (Mietzner & Reger, 2005). As Mietzner and Reger (2005) state, the
development of scenarios means speculating on uncertainties in the future, this means, to anticipate
a few different potential outcomes of future plans. The development of scenarios can also be
understood as a long-term integration of scenarios into the planning process of an organization.
Bishop, Hines and Collins (2007) highlight that the planning of scenarios is oriented towards a
finished anticipation of the future, meanwhile the result of scenario development is actual pictures
of the future. In other words, the development of scenarios is a more versatile activity, as the
development of scenarios is more oriented into development of specific stories on the future. Thus,
the latter two concepts are closely related in-between – the development of scenarios is essential
background for the planning process of [formalized] scenarios. The objective of the article binds us
to use the concept of developing brand scenarios further.
3. Opportunities of integration of brand vulnerability scenarios’ planning into
a brand management process
The objective of the strategic brand management is oriented towards the increase and
retention of the brand equity. Thus the anticipation of the brand vulnerability, in order an
organization could respond to the brand vulnerability proactively should be one of the activities for
the brand management. The tool of strategic management – the approach of scenarios – could assist
the mentioned. An organization could explicate sequential and logical pictures of the brand
environment while using the mentioned approach, also could distinguish potential factors of the
external environment, their influence to the brand vulnerability and would make correct strategic
and tactical decisions in advance, which would be oriented towards minimisation of the brand
vulnerability.
The brand management is a favourite and widely discussed subject by authors within the
scientific literature. However, it is important to highlight that many authors (Krake, 2005; Louro &
Cunha, 2001; Khan, 2009; Burman & Konig, 2010) elaborate The brand Equity Ten by Aaker
(1996) as a background for own studies, also apply in different context, in order to develop a strong
brand, moreover, the strategic brand management process by Keller (1993) and strategic brand
management and potential brand management tools presented by Kapferer (2008), in case brands
operate within the modern markets. The theory of the strategic brand management prepared by
Kapferer (2008) distinguishes within the context of classical brand management theories. This
theory does not include the process of the brand management, however, the broadness of the
strategic brand management within the modern markets is provided. The latter matrix reveals the
dimensions of depth of the brand and relationships with a customer within the perspective of time
shall be evaluated by academics and business members while managing the brand.
As Aaker (1996) states, in order to develop a strong brand the recommendations shall reflect
the brand equity measuring system firstly. Thus the recommendations of the recent author on
developing a strong brand are provided as the brand equity measuring system, but not as the brand
management process. As it was mentioned above, Kapferer (2008) also does not provide a specific
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PLANNING INTO BRAND MANAGEMENT PROCESS
brand management process. Meanwhile the objective of this article is to discuss the integration of
planning the brand vulnerability scenarios into the brand management process. In order to
implement the objective of this article, the classical strategic brand management process prepared
by Keller (2003), covering four stages, is most optimal: identify and establish brand positioning and
values, plan and implement the brand marketing programs, measure and interpret brand
performance, growing and sustaining brand equity.
Stages of the brand
management process
Activities of the
brand management process
Stages of the process of
Brand vulnerability scenario
planning
Identify and Establish
Brand Positioning and Values
Mental maps
Competitive frame of references
Points of parity and differences
Core brand values
Brand mantra
Foresight of Brand Vulnerability
Plan and Implement
Brand Marketing Programs
Mixing and matching of brand elements
Integrating brand marketing activities
Leverage secondary associations
Brand Vulnerability Decisions
Measure and Interpret
Brand Performance
Brand value chain
Brand audits
Brand tracking
Brand equity management system
Control of Brand Vulnerability
Scenarios
Grow and Sustain
Brand Equity
Brand-product matrix
Brand portfolios and hierarchies
Brand expansion strategies
Brand reinforcement and revitalization
Figure 1. Integration of the brand vulnerability scenarios planning
into the brand management process
By mean of positioning, during the first stage an organisation develops a set of abstract
associations, characterising a brand and seeks a customer to realise positive information on a brand
by comparing it with the appropriate brands of competitors. During the stage of plan and
implementing the brand marketing programs organization forms knowledge of customers on a
brand. This is the summation of a descriptive and evaluative information related to a brand, existing
in the memory of a customer, which formation depends on the initial choices for the brand elements
or identities making up the brand, the marketing activities and supporting marketing programs and
the manner by which the brand is integrated into them, other associations indirectly transferred to
the brand by linking it to some other entity (e.g., the company, country of origin, channel of
distribution, or another brand) (Keller, 2003). Thus, during the first and the second stages of the
brand management, a single constituent of a brand is developed, i.e. knowledge of customers on a
brand. As it was mentioned above, the brand equity is a solid system. According to Aaker’s (1996)
brand value system, it can be claimed that other brand value constituents – brand awareness,
perceived quality, brand loyalty – form based on the consumer’s knowledge of a brand. A brand
may become as a vulnerable asset of an organization only when one or other constituents of a
brand shall be affected in a way that a loyalty of customers towards a brand would not develop and
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(or) reduce on its basis. During such stages, in addition to other activities, it is essential to
integrate the approach of planning scenarios in order to anticipate factors of the external
environment, which may alter positive, strong and unique associations of customers towards a
brand and to describe solution methods of such problem in scenarios. In the first and the second
stages of the process of brand management, it is important while creating the brand value not only
to assess the current situation, but also possible uncertainties in future that may influence the brand
vulnerability through at least one of the brand value constituents. After predicting the future
uncertainties, it is important to work the pictures of their development and negative effect on the
brand equity, and make proactive decisions that neutralise that negative effect.
In order to measure the efficiency of the marketing programs during the measure and the
Interpret Brand Performance an organization shall measure and interpret the activity of a brand
within a market. Keller (2003) highlights two tools for measuring brand activities: brand value
chain and brand equity measurement system. The brand value chain is means to trace the value
creation process for brands to better understand the financial impact of the brand marketing
expenditures and investments. The brand value chain assumes that brand value creation process
starts when the company invests in any marketing program by targeting its actual or potential
customers.
A profitable brand management system requires successfully designing and implementing the
brand equity measurement system which consists of set of research procedures designed to provide
timely, accurate, and actionable information for marketers so that they can make the best possible
tactical decisions in the short run and strategic decision for the long run.
During the current brand management stage, in order to receive information required to the
brand management in a short-term and long-term perspectives Keller (2003) suggests using such
methods as the brand value chain, the brand audits, the brand tracking and the brand equity
management system. However, the provided methods do not anticipate factors arising in the future
and potentially causing the brand vulnerability as well as not indicate how an organization should
act then. Thus, in this stage of brand management, along with evaluation activities of brand
operation, it is important to identify which of the scenarios are active at present and make planned
decisions, i.e. control the scenarios.
The last stage of the brand management is intended for Grow and Sustain of Brand Equity. As
Keller (2003) states, even a brand occupies leader position, maintenance of a brand and its
development are the activities requiring a lot of efforts among the organizations. Thus, Keller
(2003) highlights three basic brand management fields:
1) Defining the Branding Strategy. The branding strategy of organization provides with the
most important guidelines, as to which brand elements an organisation choose to apply across the
products it offers. Two main tools in defining the corporate branding strategy are the brand-product
matrix (is a graphical representation of all the brands and products sold by the organisation) and the
brand hierarchy (reveals an explicit ordering of brands by displaying the number and nature of
common and distinctive brand components across the organisation‘s products).
2) Managing Brand Equity over Time. Effective brand management requires taking a longterm view of marketing decisions. A long-term perspective of brand management recognize that any
changes in the supporting marketing programs for a brand may, by changing consumer knowledge,
affect the success of future marketing programs. Additionally, a long-term view results in proactive
strategies designed to maintain and enhance customer-based brand equity over time in the face of
external changes in the marketing environment and internal changes in a organization’s marketing
goals and programs (Keller, 2003).
3) Managing Brand Equity over Geographic Boundaries, Cultures, and Market Segments. As
Keller (2003) states, an important consideration in managing brand equity is recognizing and
accounting for different types of consumers in developing branding and marketing programs.
Broadening of brand equity across market segments it is critical that equity is built by careful
positioning, design and implementation of marketing programs that reflect the specific knowledge
and behaviours of those market segments. Therefore, the aim of the last stage of cyclic brand
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management is solutions for further brand development in order to preserve the brand value and
growth. When integrating the scenario approach into earlier stages of brand management and on
the basis of this approach, predicting the factors influencing the brand vulnerability and making
proactive decisions, growth of the brand value and its preservation in the context of uncertainty is
possible.
Brand operation in an uncertain medium causes a tendency that preservation of brand value in
long-term view is impossible without foresight of future external trends in the medium. Integration
of future approach – the scenario planning – into the process of brand management in order to
foresight external trends of the environment that cause the brand vulnerability, will allow making
right, proactive decisions for brand development, and in such way, to ensure the brand
sustainability.
4. Discussion
Scenarios of the brand vulnerability are the sequential and explicated pictures of the factors
having influence on the brand vulnerability, indicating how they will influence the brand
vulnerability in the future. In order to anticipate the brand vulnerability, an organization should plan
scenarios, while applying the approach of scenarios, in the following sequence: 1) anticipate brand
vulnerability; 2) to develop the brand vulnerability scenarios based on the defined external factors;
3) to anticipate control system for scenarios.
Integration of scenario approach into the process of brand management allows to foresight the
future uncertainties of external environment on practical level and make proactive decisions that
minimise the brand vulnerability in future. Meanwhile, on theoretical level, added only topics on
brand vulnerability that have been recently started to be developed.
When assessing the brand operation, it is also important to use the control system of brand
vulnerability scenarios which allows detecting early signs of scenario development. When
employing the scenario planning approach in the first three stages of brand management,
organisation will ensure the brand value sustainability in a long-term view.
In further research, it is important to validate the conceptual integrated process of brand
management and scenario planning. In order to continue developing the conceptual process of brand
vulnerability scenario planning and to see more opportunities of scenario approach integration into
the process of brand management, it is important to arrange the decomposition of factors causing
the brand vulnerability.
This research was funded by a grant (No. MIP-102/2012) from the Research Council of
Lithuania.
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