Recently, we posted about Brand Architecture as a part of our Brand Dictionary series, which explores the basic elements of branding. In this entry we do a deep dive to help you understand the complexities of this subject.
Brand Architecture is one of the most complex topics we discuss in our industry, which is why we often find it is misunderstood and underutilized. While terms like Masterbrand, Branded House, and House of Brands are now becoming more well-known ideas, these terms only make up one part of the Brand Architecture story.
Before we go deeper let’s first remind ourselves of a few basics.
- Brand Architecture: Structures that communicate the relationship between an organization and all its entities, products, and services and how they should be organized. Brand Architecture is comprised of Portfolio Architecture and Organizing Principle.
o Portfolio Architecture: The relationship of offerings to one another and to the Enterprise Brand, ranging from multiple, distinct brands (Diversified or House of Brands) to a unified, consistent portfolio (Masterbrand or Branded House).
o Organizing Principle: The most effective way to group brand offerings based on how customers interact with the company (outside-in perspective); the story the organization wants to tell.
Many companies often only invest in clarifying their portfolio architecture in order to determine how many brands they should have and how they ought to relate to one another. Let us be clear, this is a critical component, as streamlining and simplifying your portfolio creates efficiencies and focuses resources (because each brand requires significant resources to develop and maintain). This component also helps with equity transfer by determining the optimal linkages between entity and product brands. However, this is only half the battle―companies that stop here are missing out on a major aspect of Brand Architecture: the Organizing Principle.
Companies inherently adopt some underdeveloped form of an Organizing Principle because they need to put a website together that organizes and presents their products and services. This approach fails to create a highly visible and impactful strategy that can differentiate the organization, reinforce the brand story, and drive tangible business results. So, how do you avoid this misstep?
1. Think outside-in
The number one most common issue we see is when an organization takes an inside-out approach, such as organizing products and services by business units or using internal language. A strong Organizing Principle is driven by the way your audiences wish to engage with you. Taking a customer perspective will not only resonate more externally, but will also help break down internal silos and encourage cross-selling. Additionally, it will help audiences better understand the breadth and depth of the portfolio.
2. Unexpected approaches can help build your brand
Many companies default to predictable Organizing Principles. For example, organizing by a product type (highly functional) that fails to differentiate a brand or say anything unique. Instead, start with core elements―mission or brand positioning―to determine how you can organize your portfolio to support that story. Appropriate strategies vary by industry, but some less traditional examples include organizing your products and services by persona, market trends, life events, or customer challenges.
3. Web architecture is not Brand Architecture
The easiest way to think about and explain an Organizing Principle is through a website structure because they are organized in categories an end user clicks on to find what they are searching for. However, while your Organizing Principle should inform your web architecture, it should also guide your other forms of communication like print, digital, and experiential. Which means you should not let how people navigate your website dictate your Organizing Principle.
4. Your organizational structure does not need to match your Brand Architecture… kind of
Most agencies will tell clients that organizational structure does not need to reflect the Brand Architecture because it is simply an external presentation of your offerings. This isn’t actually fully true though. Yes, reorganizing your portfolio in a new and unique way does not require a company to completely change org charts. However, in order to truly deliver on your strategy it does require a new way of thinking and, perhaps, a shift of a few resources. For example, if you are currently going to market by business unit and re-organize by market or industry, it would make sense to elevate several leaders to represent those markets to help drive change internally, as well as train service representatives to be able to speak to customers from a market standpoint.
Thinking about Brand Architecture in this holistic manner―both through Portfolio Architecture and Organizing Principle―can result in many significant benefits:
- Expands and/or clarifies perceptions of breadth and depth of the organization
- Help audiences more easily find what they are looking for
- Facilitates cross-selling and deepens customer relationships
- Creates marketing efficiencies and cost savings
- Provides a platform for future growth and investment
- Rallies the organization behind common goals (helps break down silos)
When looking at these many benefits it is easy to see how a strong, comprehensive Brand Architecture strategy can drive growth and improve the bottom line.
For more information on Brand Architecture, Organizing Principle, and Portfolio Architecture please visit our website.