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Are you hoping your customers will suddenly yell out “Bingo – I’ve got it!”? Is your product naming strategy so complex that customers have no choice but to keep their own charts of each name or acronym along with a description of what the product is? Do you sell standalone products or integrated solutions? Are you a business to business services company that offers multiple products to potentially the same customer? Do you know if your brand identity is more strongly associated with the first product that you sold rather than your company name? Perhaps your company grew by acquisition and your portfolio includes legacy products that you have not integrated or renamed because you have been convinced by the members of the acquired entities that their strength lies in their brand identity and ability to continue to operate separately. Is that why you justified the acquisition in the first place, or was it to integrate their solutions into your portfolio? Unfortunately, all too often the long term strategy and broader needs of the customer seem to take a back seat to the interests of the managers inside the company. Whatever the reason that you arrived at this point, several factors need to be considered when deciding right structure for your product/service naming strategy, including: • customer needs for integration of workflow and information between products, • the degree to which your product or service addresses a unique set of needs in the market in a more-or-less standalone fashion, • your ability to retain a customer that purchased multiple related products or services, • the degree to which any of your core product offerings are under severe pricing pressure and commoditization in the marketplace. To illustrate this, let’s visit the fictitious Acme Financial Services company. They sell a collection of products that are software and information services and internet technology designed to automate the financial and accounting processes of their clients. These services are sold in a modular fashion and are all designed to work together to provide a complete accounting and financial management solution, from general ledger, to accounts receivable, accounts payable, treasury, cash management, tax, billing, budgeting and reporting. A customer may buy the Acme general ledger system, or any combination of products that meet their needs. If these different components integrate well and enable automation between processes and information and reporting, then the value and benefits of the complete set to a customer is far greater than any individual product. Recognizing this, Acme decided that the optimal relationship with a customer is one where the customer buys most or all of the Acme solution set. Acme is their provider of financial services solutions. Acme’s product naming strategy reflects this approach. They used a completely descriptive name for all of their products, each name attached to the Acme company name. Thus, Acme Financial Services became the meaningful collective name for everything they represent to the marketplace. Their accounts payable solution is called Acme Accounts Payable, general ledger is Acme General Ledger, billing is Acme Billing, and so on. In this way, the product name says exactly what it is designed to do using the language that the customer uses for that function. Most importantly, the name Acme precedes every name so that the brand awareness and equity and association with the products and services offered by the company are continually driven back to the name of the company. Their goal is to establish long term loyal and trusted relationships with customers of the Acme Financial Services company. In fact, this approach is likely to ensure that the product portfolio will evolve in a way that aligns with the evolving needs of their customers as the customer values Acme as their provider of financial services solutions. Let’s contrast this for a minute with another fictitious company called Amerfin Financial Services. Imagine that Amerfin had grown through acquisition. Their original core product was an accounting package that specialized in general ledger, accounts receivable, and accounts payable processes. These products were sold as a product suite under the brand name “Fostar”, so the Amerfin Financial Services company sold a product called “Fostar GL” for general ledger, “Fostar AP” for accounts payable, and “Fostar AR” for accounts receivable. Every one of their fifteen thousand customers had bought Fostar GL, but the other products had achieved only twenty percent penetration of that base. The general awareness and brand equity that customers had with the Amerfin company was attached to the Fostar GL product that they had been using. Their perception of the scope and capability of Amerfin was limited by that product relationship. Amerfin recognized through increased competition and price pressure that their margins were being squeezed and their product portfolio was too narrow to compete. They needed to add new revenue streams quickly. They went on an acquisition spree to add the other components, each strong market players in their own niche, and their resulting portfolio looked something like this: Fostar GL – general ledger Fostar AP – accounts payable Fostar AR – accounts receivable Tresact – treasury and cash management Upay – billing Xpend – budgeting and expense management FlashIT – reporting. The brand awareness and equity of each of these products is clearly attached to the unique branded name and singular focus of that product. The Amerfin management had been persuaded that the risk of integrating and re-branding these products would be disruptive to the established product sales and it would prevent them from realizing their potential. Amerfin went to market with this new product portfolio and cross-trained their sales people on all of the products as standalone entities with their own value propositions. So, the Amerfin sales person called on the customer who uses Fostar GL as their primary product from Amerfin. Even though they are aware of Amerfin, the name Fostar is far more relevant to them as they use and “touch” that product every day. The sales person has to try to explain to this customer what the new portfolio is, how it can benefit them, and introduce a host of new names to the customer which are, by and large, meaningless. “Hi, you know and use Fostar GL and we are very pleased to let you know we have added major new components to our product line to serve more of your needs as a more complete solutions provider. Let me tell you about our newest offerings: Tresact, UPay, Xpend, and FlashIT……”. Can’t you see the customer dozing off already, or racing to search through their chart to keep up with this jumble of product names. That’s the game called buzzword bingo. It’s as though Amerfin (sadly, many companies do this) has decided to play a game with their customers to keep them guessing about what they do, at some point yelling out “bingo!” when they finally get it. The result is nothing but confusion and the challenge of selling new solutions to customers increases with each conversation. Customers struggle to understand who they [Amerfin] are and sales people rapidly retreat to selling what they know and trust to put bread on the table in the short term. Is this really how Amerfin wanted their customers to experience their relationship with the company? What if the “Fostar” product brand name had become synonymous in the marketplace with Financial Services software and solutions? Fostar achieved a dominant market share and years of successful advertising and promotions and the strong reputation of the products for accuracy and reliability. Very few customers were even aware of the Amerfin company as their association was very strongly with the company’s product – Fostar GL. The company had even developed extensive distribution channels and created certified Fostar reseller and certified Fostar developer brand programs to further cement the brand identity of this product. In this case, Amerfin might be more prudent in deciding to use the Fostar name as its flagship brand and rename its newly acquired “Tresact, UPay, Xpend, and FlashIT” brands to conform to this name. They might also enhance their product naming strategy to augment the word Fostar with descriptive words for each solution, just as in the first example where the name Acme was the primary brand. In this case, Fostar would become the primary brand name. For example: Fostar General Ledger, Fostar Billing, Fostar Reporting, and so on. The risk of changing a name with such powerful brand recognition and equity is indeed great and the costs of developing an entirely new brand for the same set of products is equally great and risky. Is the Fostar brand extensible enough to include the new components that were acquired? If not, then the company should evaluate using Amerfin as the overall integrating brand for its product line. Whichever choice is made, the goals remain the same, that is: • to simplify the communication with your customers about what you offer to them • to simplify the selling process so your sales representatives can easily address more of your customers’ needs with products in your portfolio • to support the positioning of the company as a comprehensive solutions provider • to reinforce the brand and allow a singular brand to emerge that clarifies your purpose to the market and lowers your investment in marketing promotions and sales. Patrick Smyth is a partner with OneAccord LLC, a firm that specializes in accelerating revenue in a sustained and repeatable way for small to medium size companies. Patrick has over 25 years experience in information technology & services, business-to-business marketing leadership, and product management. His talents include aligning company and product branding & positioning, building highly effective marketing processes & teams, and customer experience management to optimize sales & marketing productivity and develop profitable, long term customer relationships. Contact: patrick.smyth@oneaccordcorp.com
Article Source: http://www.content.onlypunjab.com
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