Working the Product Life Cycle as Portfolio Strategy — Special Hartbeat Exec Report
As the market share of legacy food/beverage brands continues to decline in the U.S., industry leaders are beginning to acknowledge a long-ignored truth: their companies’ portfolios are stacked high with older, legacy brands that operate fundamentally differently in modern food culture than younger, entrepreneurial upstarts. Portfolios with younger brands, especially premium brands, require a dual-mode strategic mindset that acknowledges where each brand lives in the product life cycle.
But how do these younger brands perform differently? What kind of value can they offer established firms? How do marketers need to think about their playbook differently when managing younger brands? And how do they contribute to the overall portfolio mix of forward-leaning companies?
In this issue of Hartbeat Exec, we will explore these questions by looking at the product life cycle from two parallel lenses: the hierarchy of demand drivers in each life cycle stage and the market performance of product lines operating within each stage. In the end, we see that today’s C-suite leadership faces a complex world where multiple growth strategies, with very different tactical playbooks, will be required to maximize growth.
The Q1 2016 issue of Hartbeat EXEC continues The Hartman Group’s thinking on the curious role of brand in the product life cycle. It offers a different take on portfolio analytics, one that acknowledges the critical role of early-stage and mid-stage growth brands in the long-term health of food and beverage companies. Click here to download a free copy: HBE Portfolio Strategy
The Curious Role of Brand in the Product Life Cycle
“What are some important emerging brands affecting my category?” This is a question that executives occasionally ask us in initial conversations. The wording of the question is revealing, because it implies, as most of us often do, that a brand somehow defines the product. The modern discipline of brand management encourages this view by organizing firms into brand teams designed to manage a strongly branded portfolio.
The larger the revenue is and/or the more market share dominant the brand is, the more that brand begins to overshadow product in the culture of decision making. Elaborate brand architectures get built on top of the product portfolio, especially if it is operating in a heavily commoditized category. And in planning meetings, for virtually every business decision contemplated, someone raises their hand and asks: How would it affect the brand?
The privileging of brand talk over product talk continues to encourage a grand forgetting in the modern packaged foods industry, a forgetting of what actually caused many, if not all, of today’s market-share-leading legacy brands to get where they are today. While marketing and branding play an important role in the growth of any consumer-facing business, it is very easy, in retrospect, to ascribe an unfair share of credit for a food product’s eventual success to its brand. After all, how many successful yet formerly niche lines of business in the food world have ever had lousy branding?
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