Brand Planning for HMV Company - Essay Example

BRAND PLAN FOR HMV By Location Brand Plan for HMV Introduction Brand management is of high importance to the success of a business organization. Brand management is what distinguishes product or services produced by a certain company from other despite the fact that the services of products might all be the same and meant to serve the same purpose. Brand usually represents a business organization and what they stand for. Through brand management a company can increase their competitiveness by focusing on their strengths. Brand management should also be effective in helping a business in overcoming their weakness through taking any opportunity that is availed to them by the strengths that they have and the occurrences in the business environment in which they operate. With reference to HMV, this paper aims at how a company can effectively manage their brand portfolio. The paper will begin by giving a brief description of the challenges that HMV is facing then will suggest changes in brand management that can be used in increasing the performance of the brand. Brand challenges Financial burden HMV is a global retail chain that produces products such as videos, music cassettes, gaming devices and books. There are a number of challenges that the company has been experiencing in operation of operations in the UK lately. These challenges have a direct effect on the growth and development of the company. During the fiscal years of 2008 and 2009 the company experienced a financial burden. An increase in production cost has also affected the production volume, meaning that the sales volume has to be low too (Luther 2001, p. 145). Diversification of channels was another challenge that the business organisation faced. Figure1: perfromance of HMV in comparision to other entertainment retailers Figure 2: HMV financial perfromance Overdependence on promotional prices The company also faced challenges in terms of their overdependence on promotional prices and not paying much attention to penetration strategies. Competition in this industry grew bigger and fiercer making it hard for the company to thrive. Given the fact that there were many players in the market, HMV lost some of their customers due to customer preference (King, Lannon& Baskin 2007, p. 187). There were companies who offered customers better prices, making them more attractive to customers. Figure 2: Nature of sales in the UK Lack of investment in technology HMV was also not able to cope with the technological advancement while their rivals took advantage of technological advancement. The company also lacked sufficient funds to remain competitive. As a result of their inability to cope with the changes in the market, HMV lost a big percentage of their market share. The company was also not able to effectively manage the changes that they would have made to cope with the situation that there are in. Most of their competitors offered lower prices, making them irrelevant in terms of price competition (Young2014, p. 219). The popularity of online gaming means that many people prefer playing games online as opposed to buying games from stores. This has significantly reduced the company’s sales on games. Recommended solution Brand identity Brand identity refers to the perception of customers toward a brand. It is the culture of an organization and the physical presentation that determines their brand identity. In most case, it is always seen that the brand identity of an organization is highly determined by the management strategies of an organization and the shared values. Brand identity is usually created by the ability of an organization to meet the requirements and needs of their customer. Brand identity can also be affected by inability or ability of a business organization to effectively manage their brand portfolio (Aaker 2009, p. 199). There are a number of thing that HMV can do to enhance their brand identity. For a long period of time HMV has been popular for the sale of quality DVDs. This is an aspect that the business organization should not let go. They might enforce such identity with the company’s logos. Whatever they do they should make sure that their customers can easily identify them as the retailers who avail quality music DVDs and related accessories at highly convenient prices. Brand personality Brand personality refers to the human-like characteristics that can be associated to a given brand. It has been observed that consumers have the tendency of buying products and services that they can easily associate with (Davis & Dunn 2002, p. 176). Therefore, consumers are likely to pay for a product that portrays characteristics that they have of those that portray characteristics that they adore. Looking at HMV, someone can easily notice that they are over relying on loyalty rewards on smart cards. However, this method has proved to be highly ineffective due to the fact that it has been adopted by many other business organizations, thus turning into a very common practice. HMV can be use brand personality to create a more interactive and unique way of making usre that they do not loss their customers to their competitors. For instance, they can consider easing up the buying process so that the customers can easily associate this kind of process to their busy lifestyles. Brand image Brand image refer the view that the public and customers have of a given brand. This constitutes of how the public views and perceives all the aspects of a brand. As for the case of HMV creating a positive image will of the highest benefit to the process of making sure that they enhance the performance of their brand. This can be done strategically through activities that will ensure that the brand is repositioned (Kapferer 2008, p. 211). Brand repositioning refers to the process of changing the status of a brand in dependence to the status of the brands that it is competing with. Repositioning is in most cases affected by changing the marketing mix of a brand. When a company is repositioning they obviously want their customers to see the brand in a different way. For every business organization that decides to reposition their brand there are always performance reasons as to why they want to rebrand. As for the case of HMV the reasons as to why they would need to reposition their brand has been discussed in the above section. Brand stretching Brand stretching refers to the process through which an organization introduces new aspects to its brand. The company has been known for certain products for a number of decades. Despite the several changes that have been felt in terms of consumer preference, there has been very minimal change in the nature of types of products sold by the company services (Chattopadhyay & Laborie, 2005, p. 15). For instance, the business still sells games despite the fact that emergence of online has made this sector highly unprofitable Even having the best products in the market it not the answer to the situation at HMV if they will not be able to make sure that the products gets to target market. As seen in the challenges part, one of the challenges that the company has been facing is diversity of channels. As time goes by people have the urge to get diverse ways of acquiring products. HMV should consider investing on online stores. This will enable them to curb the increased influence of online games. This will make it easier for their products to do well in the market especially video games, whose sales have been very low as a result of the popularity of online gaming. They can also reconsider making deliveries on products bought by online customers so that customer can have some ease in accessing their products (Giehl & Lepla 2012, p. 199). Communication In the 21st century, there are a number of things that have changed in marketing communication practices. For instance, business organisations have shifted from using mass messages to using messages that target specific market segments to enhance customer relations. As a result of technological advancements, there are new ways of creating unique marketing messages that target specific market segments. There are five main promotional tools that this company can used in their marketing communication. These tools are: advertising, direct marketing, personal selling, public relations, and sales promotions. It is important for a company to be able to use a blend of these tools. However, HMV did not use a blend of these tools (Dunn 2004, p. 201). In fact, the company was observed to be relying on promotional sales. When promotional tools are properly used there is always creation of awareness which leads to knowledge. With knowledge of a certain brand consumers usually develop preference leading to acquisition. Figure 3: Summary of promotional tools Brand positioning Brand positioning is a very important part of brand communication. This is because it always communicates brand identity and the benefit that the brand has in comparison to alternative brands. HMV could consider using quality positioning which will communicate the brand’s commitment to availing products of high quality to their customers. After reviewing their prices, the company can consider using value or price positioning that will give their customers the impression that regardless of the fact that the company offers high quality products, they will not have to pay extra money to get the products (Hilicki 2005, p. 156). With the current economic status most people will not be able to fight the temptation of buying such brands as long as they are convinced that the quality is good and would have cost more elsewhere. In order for the brand positioning to be successful, the company will have to invest in making their brand image better. Brand image refers to the perception, ideas, understanding that people have regarding a given brand. For a company to be able to create a brand image that will be attractive to customers they should do a research that will help them in knowing the expectations of their customers. It will also be prudent if they checked the brand images of their competitors in order to be able to know some of the aspects that they have left out in their image (Wilson & Blumenthal 2008, p. 213). For brand imaging, a company should always focus on what is different about their brand. Brand image is not all about the logo, but the perception that the customers have of a brand, therefore, HMV should know that for their case, their image will include their customer services, how their employees treat their clients, prices of product, and the kind of services that customers get in their stores. Brand Attitude Brand Attitude is usually brought about by the kind of experience that a customer have with a brand. Negative experiences usually yield negative attitude while positive experiences bring a positive attitude. With regard to attitude, the company should make sure that their products are of the highest quality possible. The kind of services that the customers are subjected to should also be made as good as possible. The company should also invest in public relations and sustainable operations. Brand atributes When articulating the benefits of the brand to their customers, HMV should make sure that they take consideration of the attributes of the brand, the characteristics, and emotional components of the brand. Attributes are the objective components of a brand that makes it able to satisfy the needs of customers in a way that the other brands are not able to. Characteristics are those suggestive claims that relate to the nature of the product. Emotional attachment to a brand is very important for brand communication. With proper research, a company can be able to know the best way through which they can create the emotional attraction to a certain brand. A common way through which companies do this is by using celebrity endorsement (Middleton, 2013, p. 186). As a result of such endorsements, people who adore the celebrity used for the brand communication will always be emotionally attached to the product even if there are cheaper or even better alternatives in the market. If the products are of affordable prices and high quality, then the brand will have an extra advantage if they choose to use celebrity endorsement. The only challenge will be that such involvements can prove to be costly, especially for a company such as HMV, which has been having some financial crisis over the past few years. Brand audit brand finance According to the loyalty measures of the company, it was observed that the Price Premium of the brand was very low. Many of the customers had the belief that the company could do better in terms of prices. Many of the customers also believed that the company had not done much to market their products. As a result of the prices and nature of marketing strategies it was discovered that the level of loyalty of the brand’s customers was very low. The perception of the public regarding the quality of products sold by HMV is that much of their company sells products of high quality. However, it should be noticed that the company has gradually lost its popularity over the past years due to poor management, which led to poor pricing policies and laxity in adoption of new and advanced technologies (Temporal 2010, p. 172). Many of their competitors have been reviewing their prices and adopting new technologies. The brand personality of HMV can also be said to be a big let down. Most of the people associate the brand to higher prices, which means that people who want to go for the most affordable option usually avoid the brand. Lack of investment in promotional program has also affected HMV’s brand awareness. Despite the fact that it has been in existence for decades, there are brands that came to existence later that are more popular as compared to them (Lowitt 2011, p. 202). Their market share has also been reducing at an alarming rate. Much of this is attributed to the fact that the company has been unable to adapt to the changes in the environment in which they operate. As a result the company has become less competitive and less appealing to customers. They would have done much to improve their status, but their financial situation is making it even harder for them to do so. Conclusion HMV is a company that has not been doing well. There are some of their problems that are caused by internal factors while others are external factors. The good thing about the external factors is that the company can have influence over them. Examples of internal factors that have been discussed herein include poor management, pricing strategies, and promotional programs. However, external factors such as consumer preference, new market entrants, and emergence of alternatives to some products such as online games can be out of their control. However, the plan that have been given herein can enable them to take charge of the internal factors that have been affecting their operations while at the same time influencing some of the external factors such as consumer preference and availability of alternatives Bibliography Aaker, DA 2009, Managing brand equity, Simon and Schuster. Chasser, A. H., & Wolfe, J. C. (2013).Brand rewired connecting branding, creativity, and intellectual property strategy. Hoboken, N.J., Wiley.http://rbdigital.oneclickdigital.com. Chattopadhyay, A &Laborie, JL 2005, “Managing brand experience: The market contact audit” Journal of Advertising Research, 45(01), 9-16. Davis, SM & Dunn, M 2002, Building the brand-driven business.San Francisco. Dunn, D 2004, Branding: the 6 easy steps,Cameron Street Press, [Oakland Calif.]. 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Middleton, S 2013,Build a brand in 30 days with simonmiddleton, the brand strategy guru,Capstone Pub, Chichester, UK.http://rbdigital.oneclickdigital.com. Temporal, P 2010,Advanced brand management managing brands in a changing world,John Wiley & Sons (Asia), Singapore.http://public.eblib.com/choice/publicfullrecord.aspx?p=822435. Wilson, JS & Blumenthal, I 2008,Managing brand you seven steps to creating your most successful self, AMACOM/American Management Association, New York.http://www.books24x7.com/marc.asp?bookid=33323. Young, A 2014,Brand media strategy: integrated communications planning in the digital era. Read More

 

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