Page 3: Corporate brand
Akzo Nobel serves both large industrial markets, such as the oil and aerospace industries and local consumer markets, such as chemists or DIY stores. Branding for such an organisation is therefore much more complex than, say, for McDonalds, with its standardised operations and retailing outlets wholly focused on the consumer market. The vital question is how to create a corporate brand that effectively represents and supports the diversity within the organisation. Akzo Nobel is a diverse multicultural organisation for a number of reasons.
- operates in a wide range of geographical locations with different cultures and ways of doing things
- operates in a wide range of markets, each with their own pattern and way of doing things e.g. there is usually a major difference between business units which concentrate on production and technology and those with more of an emphasis on marketing
- has developed over the years from a range of mergers. This has involved bringing together a large number of business units each with its own history and culture.
Akzo Nobel has opted for a decentralised organisation that is business-unit driven, allowing individual units to focus directly on their specific markets. This then raises the question: 'Why is a corporate identity or a corporate branding policy important?' As far as the public is concerned, what have pharmaceuticals to do with coatings or fibres? Moreover, as chemical products are sold ‘business to business’, the final consumers are not generally aware of their existence.
A balancing act
On the one hand, it is necessary to encourage diversity and on the other, it is important to create a unifying quality corporate brand. One current approach to branding is to create a number of categories as shown in the illustration, involving combinations of corporate and product branding.
- A single identity i.e. the corporate brand only. This applies to some industrial markets for chemicals, coatings and fibres, where the image of the corporate brand determines the reputation of the product and there is, therefore, no need for a specific product brand.
- A single identity plus product brand. This also applies to certain industrial markets for chemicals, coatings and fibres. In these markets, specific product brands are required because of high added value and/or the need for positioning in relation to other brands.
- An endorsed brand identity. This mainly applies to non-industrial markets for coatings where the product brand is the dominating factor and where some kind of endorsement with the corporate brand is applied.
- A pure branded identity. i.e. product brand identity only. This applies to pharmaceutical product lines and some activities of coatings, where no reference is made to corporate brand in product presentation or packaging. However, the corporate brand is used for such areas as stationery, buildings etc. In practice, there is a ‘grey area’ or fifth category which lies somewhere between the four categories outlined above.