Stretching Brands

An Expert's View about Reaching the Consumer in Australia

Posted on: 19 Apr 2010


Two separate but linked things that occured recently raised in my mind the value of branding in the international marketplace. The first was the issue of single-desk marketing which, through the Australian Wheat Board, has been high on the press agenda lately. The second was listening to Sir Richard Branson talking about branding at the launch of the new Virgin Money product, Virgin Home Loans.


There has never been any doubt in the minds of those involved in overseas marketing that branding is a critical factor in the success of a product. But what many people don’t understand is how many of the strong brands first came into existence, and how through their own power they have been leveraged across a wide range of categories, sometimes way beyond their original incarnation, and why in some instances other products never experience that power of branding.


Over the last three months, a lot of negative things have been said about single-desk selling, but it’s not difficult to see how these often statutory bodies have left a legacy of valuable international brands. This is very apparent in New Zealand where the Dairy Board and its grower and producer members created a raft of cheese, milk, and other dairy-based product names which are known the world over and have created strong brand loyalty, with brands like Mainland, Anchor and Ferndale. And in New Zealand it’s not just dairy products that have benefited from this form of marketing.


The Kiwifruit Board’s ZESPRE brand, and the Apple and Pear Board’s ENZA apples are both strong international brands. In South Africa too, well respected and highly marketed brands like CAPE and OUTSPAN have emerged from similar structures. In Israel the partly government-owned Agrexo has created CARMEL, a well-known brand in Europe in the horticulture sector. While many of these bodies have been restructured and in some cases incorporated, the brands continue to flourish and build market share.


Category Brands

Obviously not all brands come from one-desk operations, and to be fair Australia has created some powerful international examples like Speedo and Arnotts, although many have been sold to international players. While there are exceptions to the rule, Australians, despite government funding of ‘joint action groups’ and the like, seem to lack the ability to work together to create a cooperative brand under which to market their products around the world. Other countries, whether forced by statutory bodies or not, have created powerful industry-based brands like the Washington Apple and Mainland Cheese, and use those brands to continue to build the franchise. And, of course, when you own the brand you possess the ability to leverage the business into a wider range of categories like CAPE and OUTSPAN have very successfully done.


It’s in this field of brand leverage that the Virgin Home Loans launch caught my attention. For years people have argued brands have strong limitations in their ability to succeed in categories beyond their original incarnation. But is the limitation related to the product or the audience, or both? Although the Virign event was launching home loans, the same brand has recently been applied to superannuation and credit cards and, as everyone knows, stands for air travel and music. In South Africa it also stands for physical fitness through a range of Virgin Active gymnasiums.


While not wanting to get into the argument of how far a brand can be leveraged, the Virgin case suggests that once a sound brand has been created, opportunity exists to spread it wider. In the case of Australians doing business overseas, in categories where critical mass can be created through co-operation with other Australians, investment in a category brand is certainly an alternative worth exploring. You never know, you might end up with an airline!

* Ian Murray is executive director of the Australian Institute of Export




Posted: 19 April 2010

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