Tag: complexity

Brands and Brand Management: Conclusions on learning, planning and capabilities (2.6)

This post is part of my paper ‘The Evolving Role of Creativity in Brand Management’. You can see the other posts and the table of contents here. The previous part introduces a systems theory view of brand management.

The preceding review of brand management literature and theory leads to a range of conclusions about the context of brand management – and thus sets the stage for an analysis evolving role of creativity within the field. 

2.6.1 More, Not Less Learning 

First of all, the constructivist and systems theory based concepts introduced before should not be read as an argument for discarding analysis, strategy or marketing science. 

Complexity is no excuse for abandoning thinking. On the contrary, this perspective argues for more and a higher level of reflection, learning and theoretical abstraction about “causes of causes” (Shocker et al. 1994, p.149) regarding brands and organisations.

This can mean ‘hard’ science and generalizable laws such as double jeopardy (Sharp 2010b) or network science (Watts 2004) as well as ‘soft’ learning on an organisational level. Locating the brand and its management at the heart of organisations (Tropp 2004, p.193), this perspective joins a long tradition of brand management thinking that argues for putting the brand and learning about it at the very centre and top of the firm (Lannon & Baskin 2008). 

2.6.2 A Realistic View – Planning The Un-plannable 

Views of how consumers can be made to choose or adopt a brand have at times been oversimplified. Economists from Galbraith (1958) downwards – and indeed many marketing people—seem to have long believed that marketing or advertising can simply manipulate or persuade the consumer. Pyramidal equity models have replaced hierarchical-effects models like AIDA, Econometricians have sought to determine “drivers” of consumer choice by marketing-mix decision-models (e.g. Leeflang et al. 2000; Ehrenberg et al. 2001), but no clear empirical results in all this have yet emerged.”

(Ehrenberg et al. 2002, p.12) 

In addition, this perspective does take on a more realistic view of the control brand management can have on complex adaptive systems, with the core acknowledgment being that brand management is dealing with the paradox of planning the un-plannable and coping with what Earls called the “certainty of uncertainty” (Earls 2003, p.333).

A systems- and complexity- based model works under the premise that it is not possible to validate future developments using inductive or deductive reasoning. 

“If it is difficult to predict the effect of any activity on groups of individuals, then how much more so if the issue is the effect on the interacting individuals who make up a herd.”

(Earls 2003, p.329)

Therefore, it becomes an essential function for brand management to process environmental complexity by seeing the environment differently (Shocker et al. 1994, p.149). As introduced with the terms variety and redundancy, brand management should be expanding and narrowing down on divergent courses of action that are contingent, meaning that they might all valid.

This has implications both internally, where brand management becomes the function that produces the external context which is then seen and processed by the rest of the organisation as the environment, and externally where there might be more than strategy in action. 

As Watts and Hasker [.] suggest, place lots of bets to give yourself the best chance of starting a full forest fire – start lots of fires in lots of promising places. This challenges not only marketing practice, but our very idea of what strategy is. There is no longer one grand unified strategy, but lots of related strategies, one of which we hope takes off.

(Bentley & Earls 2008, p.22) 

The systems theory based model as introduced by Tropp neither spares a company the linear steps of strategic planning nor does it promise to successfully remove complexity (Tropp 2004, p.176) – this is not possible – it merely tries to bring learning and reflection about brand management and the environment it operates in to a higher level. 

2.6.3 Brand Management As An Organisational Capability 

Last but not least, this perspective argues for seeing brand management as a central organisational competence (Louro & Cunha 2001, p.850) and for making the actual organisational process of brand management as it is happening in the field the object of reflection for the academic discipline of brand management: 

Research on branding tends to focus on brands as assets as opposed to brand management as an organizational capability. Present knowledge about how companies de facto enact brand management processes remains limited (Barwise 1991).

(Louro & Cunha 2001, p.868) 

This is what this paper is aiming at by looking at different views, practices and theories on creativity in the context of brand management. With brands and brand management now laid out from the perspective of systems theory and the current challenges for brand management laid out as complexity, coupling and communication subsequent parts analyse the role of creativity. 

The next part focuses asks what creativity means in the context of brand management.

Barwise, P., 1991. Brand Equity, “Short-Termism”, and the Management Process. In E. Maltz & M. S. Institute, eds. Managing brand equity: Marketing Science Institute conference, November 28-30, 1990, Austin, Texas ; conference summary. Marketing Science Institute. 

Bentley, A. & Earls, M., 2008. Forget influentials, herd-like copying is how brands spread. 

Earls, M., 2003. Advertising to the herd: how understanding our true nature challenges the ways we think about advertising and market research. International Journal of Market Research, 45(3), pp.311–336. 

Ehrenberg, A., 2002. Marketing: Are you really a realist? strategy + business, 27 (Second Quarter 2002), pp.22–25. 

Ehrenberg, A., 2001. Marketing: Romantic or Realistic? Marketing Research, 13(2), pp.40–42. 

Lannon, J. & Baskin, M., 2008. A Master Class in Brand Planning: The Timeless Works of Stephen King, Wiley. 

Louro, M.J. & Cunha, P.V., 2001. Brand management paradigms. Journal of Marketing Management, 17(7), pp.849–875. 

Grots, A. & Pratschke, M., 2009. Design Thinking – Kreativität als Methode. Marketing Review St. Gallen, 26(2), pp.18–23. 

Sharp, B., 2010b. How Brands Grow: What Marketers Don’t Know, Oxford University Press. 

Shocker, A.D., Srivastava, R.K. & Ruekert, R.W., 1994. Challenges and opportunities facing brand management: an introduction to the special issue. Journal of Marketing Research, 31(2), pp.149–158.

Tropp, J., 2004. Markenmanagement: Der Brand Management Navigator. Markenführung im Kommunikationszeitalter, VS Verlag.

Watts, D.J., 2004. Six Degrees: The Science of a Connected Age Reprint., W W Norton & Co. 

A Systems Theory-based Brand Management Model (2.5)

This post is part of my paper ‘The Evolving Role of Creativity in Brand Management’. You can see the table of contents here. The previous part was about the (enduring?) challenges facing brand management.

As Grots & Pratsche (2009, p.18) point out, many of the challenges in today’s economy are too complex to be mastered by a single genious, a single department or a single company. Organisations always had to process and transform the complexity of their environment to survive and they continuously have to reconfigure and transform their coping strategies to keep up with what is happening around them.

To implement that thought in brand management theory and to provide a higher level of abstraction, Tropp (2004, p.170) integrates the aforementioned conceptualizations of brands, environmental challenges and management into a systems theory based model of brand management that is seen in Figure 3.

Systemic Brand Management Model (translated from Tropp 2004, p.170)
Figure 3: Systemic Brand Management Model (translated from Tropp 2004, p.170) 

In this model, the management of a brand itself is included and three major management dimensions are identified (Tropp 2004, p.168): 

  • Brand potential, which asks if brand management has the ability and potential to learn and use systemic thinking and acting,
  • Brand relationship, which measures whether a brand builds and nurtures relationships between customers and a company. 
  • Brand experience, which asks whether a brand has the preconditions to intervene in 

the cognitive system of consumers. 

In addition, three ‘philosophical’ pillars are suggested for brand management (Tropp 2004, p.176f). These pillars are reflexivity, complexity and holistic thinking.

Reflexivity means that brand management is – first of all – self management, in line with management and organisational theory that sees organisations as a communication system. In that sense, brand management is to a high degree self-organisation and self-referential.

Complexity means that the function of brand management in organisations is to vary and transform environmental complexity. To make this happen, brand management has to apply measures to increase complexity (variety) and to reduce complexity (redundancy). Variety is used to come up with new options, futures and possibilities – to produce ‘unpredictable outputs’, redundancy is used to reproduce the already known.

Holistic thinking aims at understanding the relationships, patterns and properties of and within systems instead of focusing linearity and analytical reduction and consequently argues for a circular view of causes and effects and for a more probabilistic planning.

—

The next part pulls together the conclusions from the current brand management paradigms, the challenges facing brand management and a systems theory view of brand management.

—

Grots, A. & Pratschke, M., 2009. Design Thinking – Kreativität als Methode. Marketing Review St. Gallen, 26(2), pp.18–23. 

Tropp, J., 2004. Markenmanagement: Der Brand Management Navigator. Markenführung im Kommunikationszeitalter, VS Verlag.

Responding to Brand Management’s Challenges (2.4.4)

This post is part of my paper ‘The Evolving Role of Creativity in Brand Management’. You can see the other posts and the table of contents here.

“Brands are made, not born. The process of their construction is complex. From a manufacturer’s point of view there is a reduced form, “stimulus-response” style simplicity to it:
(1) the manufacturer takes actions (e.g., the marketing mix) and that leads to
(2) customer mental responses towards the brand (perceptions, beliefs, attitudes, and so on). These perceptions (and the resulting willingness to pay) in turn lead to
(3) customer behavior in the product market (e.g., sales), which in turn generates
(4) financial value in general and stock market and market capitalization in particular.
This framework or value chain is a useful basic conceptualization. Still, it obscures some important complexities.” (Keller & Lehmann 2006, p.752) 

As the review of contemporary challenges for brand management tried to argue, predominant brand management practice does not reflect on environmental complexity. What most concepts, models and recipes still have in common is that they use a more or less simplistic perspective on the management of systems (Tropp 2004, p.130). They perceive brands as ‘trivial machines’. This means that by giving an order in the form of information, a system will react in a way so that certain goals will be reached. Metaphorically, managers thus become engineers, dealing with the control of a closed system, simply adjusting the given input based on feedback from the system and thus reaching their objectives.

This perspective promotes a “primacy of planning” (Tropp 2004, p.132) and puts analysis and strategy at the beginning of a linear and controllable process. Management theory, from this perspective, believes that brands can be easily manipulated by using the right levers, following a linear path that leads to guaranteed success if only the instructions are followed carefully. This perspective on brand management may be understood as “brand engineering” and is visible in such words as the German “Markentechnik” that brings with it an almost almighty claim to brand building success. 

If, however, as argued before, the multidimensional knowledge about brands is shaped by the experiences and social interactions of consumers and if this happens in an increasingly unpredictable landscape, then brand management is ill-advised to adhere to this perspective. 

With a failure rate at the introduction of new brands of between 50 and 95% (Buchholz & Wördemann 1998, p.20 qtd. in Tropp 2004, p.144) and in light of the over-boarding complexity of companies’ environments, the empirical regularity today is closer to failure (Ehrenberg 2002; Ehrenberg 2001) than success. This, in turn, raises doubts if these failures are a consequence of not obeying to the how-to’s of positioning, branding or even advertising execution or if it is the underlying paradigm of a linear and logically deductible outcome and “how-to” literature that might be flawed (Tropp 2004, p.144). 

—

Buchholz, A. & Wördemann, W., 1998. Was Siegermarken anders machen, Econ. 

Ehrenberg, A., 2001. Marketing: Romantic or Realistic? Marketing Research, 13(2), pp.40–42.

Ehrenberg, A., 2002. Marketing: Are you really a realist? strategy + business, 27(Second Quarter 2002), pp.22–25. 

Keller, K.L. & Lehmann, D.R., 2006. Brands and branding: Research findings and future priorities. Marketing Science, 25(6), p.740. 

Tropp, J., 2004. Markenmanagement: Der Brand Management Navigator. Markenführung im Kommunikationszeitalter, VS Verlag.

Challenges for Brand Management: Complexity (2.4.1)

This post is part of my paper ‘The Evolving Role of Creativity in Brand Management’. You can see the other posts and the table of contents here.

While in the past three global CEO studies, conducted by IBM, coping with change was the most pressing challenge, complexity took the lead in 2010, as seen in Figure 2.

“CEOs told us they operate in a world that is substantially more volatile, uncertain and complex. Many shared the view that incremental changes are no longer sufficient in a world that is operating in fundamentally different ways.“ (IBM 2010, p.8)

IBM Complexity

Figure 2: Organisations and complexity (IBM 2010, p.15)

Complexity is the most important concept in systems theory, as it is the reason why systems form in the first place. While the term is present in different approaches to systems theory,  Luhmann’s theory of social systems popularized it, stating

“we will call an interconnected collection of elements complex when, because of imminent constraints in the elements’ connective capacity, it is no longer possible at any moment to connect every element with every other element […] Complexity in this sense means being forced to select; being forced to select means contingency; and contingency means risk.” (Luhmann 1995, p.25)

A system can never reach the same level of complexity as its environments and therefore has to counter-balance this inferiority with selection-strategies, reducing external complexities (Tropp 2004, p.57). This necessarily selective reduction of relations between elements (e.g. information) is called contingency and brings with it the necessary risk to select different possible combinations of elements. However, with every selections come different other – not selected – possibilities that would be possible as well.What sounds arbitrarily complicating in the first place, does make sense in light of the unrelated and relatively arbitrary list of trends, drivers and perspectives that are present in brand management and marketing textbooks. To illustrate the concept of complexity in this context, it can be said that branding theory does not have an appropriate selection strategy (theory) that is able to reduce the environmental complexity (challenges) to a level that would allow for sensible systematization.

Complexity is a theoretical concept that is not able to explain the myriad of trends and environmental challenges, but the fact that companies will – in the future – have to accept unprecedented complexity as a permanent trait of their environment (Rose & Zuckerman 2009, p.13) and to acknowledge that “it’s no longer possible to observe and predict enough to map out courses of action that guarantee desired outcomes” (Andjelic 2010).

This has some important implications for strategic planning and strategic thinking that will be introduced at a later point.

—

Andjelic, A., 2010. the problem of strategy. i [love] marketing. Available at: http://anaandjelic.typepad.com/i_love_marketing/2010/07/the-problem-of-strategy-1.html [Accessed January 4, 2011].

IBM, 2010. Capitalizing on Complexity. Insights from the 2010 IBM Global CEO Study. Available at: http://www-935.ibm.com/services/us/ceo/ceostudy2010/index.html.

Luhmann, N., 1995. Social systems, Stanford University Press.

Rose, J. & Zuckerman, N., 2009. Can You Reach the Masses Without Mass Media? Available at: https://www.bcgperspectives.com/content/articles/cmos_dilemma/ [Accessed February 4, 2011].

Tropp, J., 2004. Markenmanagement: Der Brand Management Navigator. Markenführung im Kommunikationszeitalter, VS Verlag.