Case Study: Walt Disney Internet Group Japan’s Dimo Project

Date: February 28, 2007 By Pham Thi Thuy Ha

Most important question

How should WDIG increase the awareness of the Dimo brand among i-mode users?

Key drivers

· I-mode subscribers.

· I-mode providers (NTT Docomo).

· Strategic relationship-partnership with i-mode providers.

· Strategic partners with whom WDIG work with to develop character design and contents.

Competitive advantages

· ‘Living’ set of characters that can create different histories about the existence and therefore fulfill users’ need for self-image and identity.

· In-house innovation and technology enable WDIG to keep pace with fast changing Japanese mobile markets especially i-mode technology.

· Low operating costs.

Recommended strategy for WDIG

· Choose a product branding strategy, which is to create Dimo as a non-Disney brand exclusively to the set of Disney characters and to position Dimo brand as an individual brand that is totally separated from Disney brand.

· Continue to develop the power of Dimo set of characters as living characters by adding contents and histories characters can tell.

· Strengthen strategic relationship with NTT Docomo; continue to ask it for financial support for advertising and promotion campaigns; work closely with Docomo to develop new contents for future Docomo’s new series phones.

· Position Dimo brand as ‘self-image’.

· Target teenagers and adults in their early 20s who need self-image and identity to characterize themselves.

· Distribute Dimo set of characters via i-mode providers, especially via NTT Docomo.

· Communicate the positioning via Dimo Websites, ads on magazines and newspapers for teenagers and adults, TV commercials on channels for teenagers and adults, advertisement campaigns at places where teens and adults frequently come such as teenager shops.

· Register the trademark of Dimo set of characters and license the character set to expand business.

Case Study: Just in time for the holidays

Date: January 16, 2007 By Pham Thi Thuy Ha

Problem: North Pole Workshops’ production capacity can not meet the surging demand for Timmy CDs on Christmas Eve. The management team gets stuck in mapping a solution to fulfill such demand because team members have their own solutions and they oppose the others’ solution.

Reasons:

- Weak demand forecast ability (the actual demand is 20% over the company’s assumption)

- Weak production planning ability

- No links between demand and production planning

- Do not have compelling product strategy, sales & marketing strategy, operation strategy

Suggested temporary solution:

- If the company can use current production lines of Meorwrrr or change them to produce Timmy CDs, the company should stop producing Meowrrr and produce Timmy CDs.

- If the company can not use other production lines to produce Timmy CDs, it should sell Moewrrr in the US market instead of Timmy CDs as proposed by Fiffledip.

Suggested long-term solutions:

Production strategy:

- Redesign products so that all products can share as many common components as possible. This will help the company use a production line to produce various products.

- Redesign production process to make it become flexible to produce many types of toys.

- Diversify product lines so various products can substitute each other when one product is not available on sales.

Operation strategy:

- Adopt a flexible manufacturing system such as cellular manufacturing to achieve mass customization and reduce production lead time.

- Outsource some unimportant components in the US.

- Outsource toy production with tight control over product quality to China. This will help the company fulfill surging demand in the Asian market, cut production costs and reduce pressure of over capacity.

Branding strategy:

- Create and maintain successfully a strong brand to deliver the “soul” of the company’s toys to children and make them understand the core brand values rather than a single product Timmy. A strong brand can make children feel happy with various toys from the companies and willing to buy other toys when the toy they want is not available.

Sales & marketing strategy:

- Improve demand forecast ability. The company should make demand forecast by using historical sales data and managerial judgment of the current market conditions. But the company should not make demand forecast by basing on the number of the letters received from children.

- Use letters from children as a source of information to develop new products that meet children’ preferences and predict future purchase trends

- Sell toys to the core values of the brand

- Create & develop a strong distribution channel that can sell the core brand values to children

- Use up-selling: encourage children to continuously buy upgraded toys. This strategy can motivate children to visit stores often and buy new products that bring the company greater profits.

- Use cross-selling: sell one toy to children and recommend them to buy other toys as complement toys. This strategy can encourage children to make their own collection of the company’ various toys, and create the desire to buy many types of toys.

- Urgent purchase strategy: create the feeling of urgency to buy the company’s toys when the items are available. This strategy can encourage children to buy toys around the year instead of waiting for Christmas. By doing so, the company can avoid the surge of seasonal demand and predict better future demand.

Case Study: The Global Branding of Stella Artois

Executive summary

1. Ask SEED Question

Initial Question

What are we trying to achieve?

We want to develop Stella Artois as a strong global brand serving as Interbrew’s global flagship brand.

“Why”

· Global brand will be a base trend in brew industry and the beer industry will be internationalized in the next decades.

Why?

· To achieve synergies in global advertising and economies of scale to serve converging global beer market.

Why?

· To leverage low operating costs as a key competitive advantage.

Why?

· To expand globally and become a main player in the global beer market.

Why?

· To achieve sustainable growth by serving the global market.

Why?

· To be aware as a strong global brand.

The SEED Question

How to develop Stella Artois as a true global brand? (New)

How can Interbrew increase the awareness of Stella Artois as a true global brand, managing it consistently across countries? (old)

Why is the SEED Question Important?

· The question is strategic because it is a part of Interbrew’s corporate strategy to achieve sustainable growth in the future.

· The question is explicit because it states exactly what kind of brand development we are pursuing.

· The question is executable because Interbrew’s marketing forces can execute an implementation strategy to answer this question.

· The question is direct because it is a direction to achieve the goal.

· While answering this question, we can truly solve the challenge at hand. By increasing brand awareness, we can have people around the globe know about the brand. By managing brand consistency, we can successfully develop the brand as a strong brand identically perceived across countries and regions in the world.

· While answering this question, we will become a champion. If we answer this question, we will successfully develop Stella Artois as a global brand that helps Interbrew achieve the corporate strategy and leverage current and future competitive advantages.

2. Mapping Ecosystem

In the map, we consider subsidiaries, franchises and joint-ventures have the same relationships with media, press, advertising agencies, distributors and Belgian café in local countries.

Key drivers:

- Strategic relationship with franchises and joint-ventures.

- Local laws and regulations.

- Strategic outsourcing partnership with suppliers.

3. Competitive Advantages

3.1. Current competitive advantage is operation efficiency. This competitive advantage reflects:

- Economies of scale

- Production efficiency

- Capacity utilization

- Strategic outsourcing and partnership with best suppliers

Interbrew can have lower operating costs than its competitors

3.2. Future source of competitive advantage is global brand

Global brand will help Interbrew differentiate itself from its competitor. By positioning Stelle Artois as a super-premium beer, the company can charge premium price.

The current and future competitive advantages will enable Interbrew make higher profits than its competitors.

4. Objectives

- Increase brand recognition among beer drinkers in the markets where Stella Artois was launched by 10% in the next year.

- Increase brand perception as ‘sophisticated brand’ among beer drinkers in the markets where Stella Artois was launched by 10% in the next year.

- Increase brand perception as ‘premium brand’ among beer drinkers in the markets where Stella Artois was launched by 10% in the next year.

- Increase brand perception as ‘authentic brand’ among beer drinkers in the markets where Stella Artois was launched by 10% in the next year.

5. Relevant Strategic Options

6. Brand Strategy

We recommend that the 2^nd strategy is the best for the companies because this strategy can help the company answer the most important question and achieve objectives while leveraging key drivers and competitive advantages.

Strategic Options

	1. Sophistication	2. Self-image	3. Individuality
Product	- Very high quality of the beer - Super premium beer	- Very high quality of the beer - Super premium beer	- Very high quality of the beer - Super premium beer
Support	- Noble tradition of European brewing - Feeling of self-esteem and sophistication	- Noble tradition of European brewing - Feeling of self-image, sophistication and identity	- Noble tradition of European brewing - Feeling of individuality, sophistication and selectivity
Positioning	Modern, sophisticated yet accessible drinking experience	Modern, sophisticated yet accessible drinking experience that reflects self-image and identity	Modern, sophisticated yet accessible drinking experience that reflects individuality and worth
Target	Males between 21 to 45 years of age, live in urban cities and are premium lager beer drinkers	Males and females between 21 to 45 years of age, live in urban cities and are premium lager beer drinkers	Males and females between 21 to 45 years of age, live in urban cities and are premium lager beer drinkers
Distribution	- Execution by local managers - Local distribution channel - Points of sales: department stores, retailers, sellers, bars, restaurants, hotels - Places: only potential markets (cities that pass 4 criterion screen)	- Execution by local managers - Local distribution channel - Points of sales: department stores, retailers, sellers, bars, restaurants, hotels - Places: only potential markets (cities that pass 4 criterion screen)	- Execution by local managers - Local distribution channel - Points of sales: department stores, retailers, sellers, bars, restaurants, hotels - Places: only potential markets (cities that pass 4 criterion screen)
Communication	- Execution by local managers - Prestigious outdoor advertising - Sponsorship to high-ends celebrity events - Selective TV commercials - Print ads on magazines and newspapers targeted to the targeted audience	- Execution by local managers - Prestigious outdoor advertising - Sponsorship to high-ends celebrity events - Selective TV commercials - Print ads on magazines and newspapers targeted to the targeted audience - Online advertising - POS, sales promotions - Packaging - PR	- Execution by local managers - Prestigious outdoor advertising - Sponsorship to high-ends celebrity events - Sponsorship to cinema events - Selective TV commercials - Print ads on magazines and newspapers targeted to the targeted audience - Online advertising - Advertising in cinema - POS, sales promotions - Packaging - PR
Legal	- Register the brand name in local countries or regions where the brand is sold - Get legal approvals for advertising campaigns, PR and other marketing activities	- Register the brand name in local countries or regions where the brand is sold Get legal approvals for advertising campaigns, PR and other marketing activities	- Register the brand name in local countries or regions where the brand is sold Get legal approvals for advertising campaigns, PR and other marketing activities
Map structure	- Centralized control over marketing programs by headquarters. - Have a single global ad campaign	- Both centralized and decentralized control over marketing programs. - The corporate marketing group at headquarters is in charge of identifying priority markets, developing core positioning and providing guidelines for local execution. The group decides what elements of marketing programs should be standardized and what should be customized to fit local culture and regulations. - Local marketing or sales managers are in charge of developing and executing advertising campaigns and measuring results. - The group and local managers work closely to balance global and local control	- Both centralized and decentralized control over marketing programs. - The corporate marketing group at headquarters is in charge of identifying priority markets, developing core positioning and providing guidelines for local execution. The group decides what elements of marketing programs should be standardized and what should be customized to fit local culture and regulations. - Local marketing or sales managers are in charge of developing and executing advertising campaigns and measuring results. - The group and local managers work closely to balance global and local control

Case: BRAND EXTENTION AT REAL MADRID

Executive summary

Real Madrid (RM) has been worldwide-known as one of the best soccer club in the world. However, RM has experienced negative profits in recent years due to changes in the soccer environment. To achieve sustainable growth, RM needs to extent its brand worldwide in order to gain profits. To do so, RM needs to set up a new channel of communications and partnership-relationship with retailers, broadcasters and franchisees who are key drivers in enabling RM’s brand extension around the world.

1. Ask SEED Question

Initial Question

What are we trying to achieve?

We want to extent Real Madrid brand worldwide to gain profits.

“Why”

· To have stable profit growth in the future independently from field performance.

Why?

· To counter the stagnation of revenue growth from traditional channels (broadcasters, sponsors, match day).

Why?

· To sustain the profitability of the club in the long term.

Well, that’s obvious!

The SEED Question

How can Real Madrid gain profits while extending its brand worldwide?

(How Real Madrid can have the best profitability through expanding it brand worldwide).

Why is the SEED Question Important?

· The question is strategic because it is a part of the implementation plan to achieve RM’ new vision and mission

· The question is explicit because it states exactly what kind of brand development we are pursuing.

· The question is executable because RM’ marketing forces can execute an implementation strategy to answer this question.

· The question is because it addresses the declining profit problem that RM is facing.

· While answering this question, we can truly solve the challenge at hand. By extending the brand worldwide, RM can have stable and increasing incomes by selling contents and merchandise and therefore achieve sustainable profitability.

· While answering this question, we will become a champion. When the brand is extended, RM will have stable income sources, therefore RM will not totally depend on incomes from traditional channels which are depending on the team’s performance. By answering this question, RM will become the champion in the soccer business field.

2. Mapping Ecosystem

Ecosystem

2.1. External factors

Law: RM has to follow the regulations in the business environment and the institutional rules framework of UEFA and FIFA without being able to influence them.

Media: RM has to be aware of the media’s influence in presenting a positive image and utilize it to achieve more visibility.

Market: RM needs to take into account market structure and conditions in different geographical regions where it extends its business.

2.2. Individual components

· Strategic partners: Sponsors and players are the strategic partners of RM because they bring RM incomes.

· Players’ sponsors: Sponsors bring incomes to the players, half of which are shared with RM.

· Real Madrid: RM’s management is the heart of the Ecosystem map. The management needs to utilize the other individual components in the map to extend RM’s brand in order to increase profits.

· Competitors: The competitors in the map include RM’s competitors in the field such as other soccer clubs and business competitors.

· Retailers: Retailers are RM’s distributors.

· Franchisees: Franchisees pay royalties to RM for using its assets such as logo and contents for business purposes.

· Broadcasting: The broadcasters show the club’s games to soccer fans all over the world.

· Customers: Customers are people or organizations who buy products/services from RM or RM’s franchisees.

2.3. Linkages and flows in the map

· RM and Sponsors: Money flows from sponsors to RM in exchange for advertising rights from RM.

· RM and Players: The most significant flow between the two in this case is the flow of money: RM pays the players for their services and the players give half of their advertising incomes to RM.

· Players and their Sponsors: The players have their individual sponsors who pay them for the right to use their image for advertising purpose.

· RM and Retailers: RM grants the retailers the rights to sell its products.

· RM and Franchisees: RM grants the franchisees the rights to use its assets such as logo and contents.

· RM and Broadcasting: RM grants the broadcasters the rights to air its games.

· Retailers and Customers: This is buying-selling relationship.

· Franchisees and Customers: This is buying-selling relationship.

· Broadcasting and Customers: The customers pay for the entertainment they get by watching the team’s games.

· Competitors and Broadcasting, Franchisees and Retailers: Competitors provide the broadcasting, franchisees and retailers money and information.

2.4. Evolution of the Ecosystem

Past

The main income sources were from gate receipts and broadcasting, which highly depend on RM’s performance in matches. While the incomes from gate receipts and broadcasting increased slowly, the expenses surged due to sharp increase in salaries paid to the players and quick augment in costs of buying the best players. When revenues were less than expenses, RM experienced negative profits in many years.

Present

To achieve sustainable growth in the future, RM needs to have stable independent revenue sources that are independent from its performance in the field. Given stagnant increase in traditional revenue streams, RM needs to leverage its brand into the global market to gain more revenues. The best way to leverage the brand is to extent the brand worldwide.

Futurur

If RM were unable to extent its brand worldwide to gain profits, it would continue to have losses and therefore unable to have the best players. If RM did not have the best players, its performance in games would not be better and therefore RM would not be able to gain championships. If RM lost games continuously, incomes from traditional sources would decrease. Therefore, RM would face deeper losses.

3. Key Drivers

From the Ecosystem Map, the Key Drivers are Retailers, Franchisees and Broadcasters through which RM can reach customers and extent the brand. The key drivers are the enablers for RM to extent successfully its brand.

4. Situation Summary

Real Madrid has been expanding its brand globally in the past few years. It has been increasing revenues from stable income sources such as merchandising by entering various international markets. The challenge in front of the club’s management is how to take the next step and extend its brand worldwide in a profitable manner.

In the case assignment we are asked to recommend the best strategy for the club to implement in order to answer the SEED question. However, we are not able to propose a strategy at this point because we need to follow the necessary steps to reach the conclusions. Still, if we were to provide basic guidelines, we recommend the following, hereby our situation summary.

1. In order to achieve its goal the club management needs to reach more customers.

2. In the end, the club needs to think of how to reach more visibility and extend its merchandise to new markets. Working within the framework of the ecosystem map and focusing on the key drivers and the SEED question, we will be able to pinpoint the right approach to increasing profitability in the long run and extending the Real Madrid brand worldwide.

3. We have identified three main channels for that, namely retailers, franchisees, and broadcasting. The connection of these channels with the customers and how Real Madrid will be able to utilize them is crucial for the success of the club in extending its brand worldwide in a profitable manner. If Real Madrid fails to utilize these channels, then other clubs, namely RM’s competitors, will do and the club will suffer losses.