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  • Author: Katarína Janoskova x
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Linear Model for Brand Portfolio Optimization

Abstract

Research purpose. The aim of the paper is to create a model that allows building an optimal brand portfolio, allowing an organisation to achieve its goals. The created model is based on the bivalent programming theory. A mathematical model of optimum brand portfolio is created based on linear programming with restricting conditions being the maximum acceptable risk level and budget. The basic types of resources and basic types of relations between brands are explained, which are part of the process of brand portfolio optimization.

Design / Methodology / Approach. Knowledge and many years of experience of mainly economic disciplines were used for the selection of characteristics for brand portfolio specified in this article. Our assumptions were based mainly on project portfolio management, operational analysis and linear programming as well as tools and methods of graph theory.

Findings. Brand portfolio management such as creating, planning, organising and then maintaining a successful brand is a costly and long-term process involving effective marketing strategies and decisions. The prerequisite for brand portfolio creation is deciding on the number and type of brands. A properly constructed brand portfolio is a prerequisite for achieving business goals.

Originality / Value / Practical implications. Brand portfolio optimisation requires sufficient attention; however, rather than the selection of the highest number of brands, it should be based on compilation of a set, according to pre-defined priorities, which would provide the best possible means to meet the company’s goals for the current limitations. It should be implemented upon objective rules (in our case maximum allowable risk level and available budget). Frequent changes in the brand portfolio structure are not beneficial since they reduce the ability for the company to achieve its targets and represent excessive use of resources. In addition, qualitative brand characteristics have to be respected in the brand portfolio management, but this was not covered in our research.

Open access
Proposal for Brand’s Communication Strategy Developed on Customer Segmentation Based on Psychological Factors and Decision-Making Speed in Purchasing: Case of the Automotive Industry

Abstract

Customers are key in the brand-building process. Many times, this term is applied very broadly, especially in segmentation and planning. Knowing the customer buying behaviour and customer decision-making process is important for brands, especially today, when customers are informed much better and get information over the Internet faster. In this paper, we present theory that deals with the purchasing behaviour of customers and emphasize the analysis of the sales cycle of the individual phases in the current conditions, when segmentation based on socio-demographic data is not enough. It is much better to define the psychological factors, which influence the customer and motivate him to buy in combination with the buyer’s decision-making speed. Thus, the article discusses the basic four types of customers according to the major research work carried out by Eisenberg brothers. Based on this analysis, we can determine the percentage of individual customers. The article offers a survey that was conducted to find the most important factors in the decision-making process when buying a car. In addition to the criteria, we also asked our respondents about the importance of these factors. We have used the multiple criteria decision analysis as it is one of the methods of complex evaluation and it minimizes the degree of subjectivity in choosing a suitable variant. Based on our survey, we have used analysis to estimate trends that brands operate in automotive sector could use to communicate in order to address the type of customer that belongs to their target audience. The primary aim of the paper is to prove that there is a growing trend of humanistic customers through study about their preferences and criteria during the decision-making process that leads them to buy a new car. Moreover, we determinate communication strategies for all four types of customers based on theory provided by Eisenbergs.

Open access