Brands

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Brands

• .and the creation of value

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Themes

• British Brands Group
• Brands and value
• Brands and own label
• Value creation

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The British Brands Group
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• Brand manufacturers exclusively
• Only brand-focused organisation
• Cross-sectoral
• Formed in 1994
• UK arm of European Brands Association (AIM)

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Audiences

• Ministers, MPs and advisers
• Civil servants - DTI, Patent Office
• Competition authorities
• Consumer Groups
• Journalists

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Brands and value
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McDonalds
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If Coca-Cola were to lose all of its
production-related assets in a disaster, the
company would survive. By contrast, if all
consumers were to have a sudden lapse of memory
and forget everything related to Coca-Cola the
company would go out of business. Coca-Cola
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Superbrands
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Superbrands
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Financial Times
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It only takes one bad experience over the
telephone to destroy millions of dollars of
advertising Bob Ayling former CEO, British
Airways
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Express, 2004
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Brand Finance
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Illustrative
Brand Finance
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Brands and own label
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TNS
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The scope of todays retail brand

• Food
• Clothing
• Electrical goods
• Entertainment
• Banking
• Mobile phones
• Internet access
• Pharmacy
• Petrol
• Holidays
• Gas and electricity
• Legal services

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Own label ranges

• Now
• Economy
• Regular
• Taste the Difference
• Be Good to Yourself
• Organic
• Oriental
• Italian
• Blue Parrrot Café
• PerformProtect
• Freefrom
• Activenaturals

• Then
• Private Label

TNS
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• availability
• price
• rate of sale
• communication
• promotions
• advance knowledge of key plans

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TNS
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Max Factor Lipstick L'Oreal Plenitude Paradontax
Toothpaste Douwe Egberts Coffee Cheese Argentine
Beef Play Boy Ariel Color washing
powder Baccardi Breezer Red Bull Oral B brushes
Duracell batteries Marlboro cigarettes Postage
stamps Telephone cards Pampers Mobile Phones HP
printer cartridges
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Toiletries Value Share by Manufacturer
-5.1
3.9
2.9
IRI
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of businesses with significant new products
PIMS
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Low
High
Innovation efficiency factor
Share of total sales generated by new
products/share of total sales spent on RD
Arthur D Little, 2005
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Overall liking
BRI 2005
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Value creation
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Pricing in 200 categories May 03 to June 04
2003
2004
IRI
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• Always
• Anadin
• Anchor
• Aquafresh
• Ariel
• Birds Eye
• Bold
• CDM
• Carex
• Cif
• CDC
• Comfort
• Daz
• Domestos
• Dove
• Frosties

• Persil
• Whiskas
• Fairy
• Felix
• Flash
• Flora
• Galaxy
• Gillette Series
• Goodfellas
• Head Shoulders
• Heinz Ketchup
• HP Sauce
• Huggies
• Hula Hoops
• ICBINB
• Imperial Leather

• Impulse
• Corn Flakes
• Huggies
• Lenor
• Lil-Lets
• Lurpak
• Lynx
• Macleans
• Magnum
• Mullerlight
• Nescafe
• Homewheat
• Penguin
• Kit Kat
• Nurofen
• Oil of Olay
• PG Tips

• Pampers
• Pot Noodle
• Pringles
• Radox
• Right Guard
• Robinsons
• Sensodyne
• Soft Gentle
• Solpadeine
• Sure
• Tampax
• Tetley
• Vaseline ICL
• Walkers
• Quavers
• Weetabix

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1998 Price 193.25
2004 Price 175.38 9.6 less 17.87 less
IRI
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Importance of price to the consumerOnly 4 in UK
identified price as the issue
Eurobarometer 2003
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Factors influencing choice of where to shop
of households
ACNielsen
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Annual increase in input pricesFeb 2004 to Feb
2005
Office for National Satistics
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Lack of investment in innovation Eroding
consumption can be linked to eroding investment
in innovation
Eurostat
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The consumer basket FMCG spend increasing but
losing share of household consumption
Eurostat
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Do you see more focus on price than ever before?
ECR Euroope
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What do you consider the most important measure
today?
ECR Euroope
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What do you consider the most important measure
today?
ECR Euroope
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How satisfactory is the current negotiating model?
ECR Euroope
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How often do you share data with your partners?
ECR Euroope
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How focused on the consumer is the current
negotiating model?
ECR Euroope
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How long is our current business model
sustainable for?
ECR Euroope
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The results

• 85 agree the current business model cannot last
  more than 10 years
• 91 see focus on price as a major issue for the
  industry
• 12 use shopper satisfaction as primary success
  measure (42 felt it should be)

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The challenge from ECR Europe

• To drive sustainable sales / value growth
• Go back to basics understand shopper and
  consumer needs
• Collaborate on joint business plans to influence
  ALL value creation drivers
• Provide genuine innovations beyond price that
  improve the shopping experience and the product
  offering

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Themes

• The brand is everything - in peoples minds
• Mind space is the driver of value
• Current economic pressures are unsustainable
• A need to re-focus - on joint value creation

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• British Brands Group
• 8 Henrietta Place, London W1G 0NB
• info_at_britishbrandsgroup.org.uk
• www.britishbrandsgroup.org.uk