Branding and product positioning are some of the most vital elements of any marketing plan in the contemporary business environment. In an extensive and intense market terrain that is supported by advanced technologies, it is necessary for established firms, products or brands to maintain and position their existing brand name to improve their market share and visibility. In this perspective, the use of the current brand name and image has become a common strategy for the introduction and shielding of new products in the market. The primary reason for using branding and product positioning techniques is to capture the mind of the consumer and make sure that they can subscribe to your product (Alfredson, Stensson, & Stromberg, 2015). Positioning and branding are basically the war for the mind of the consumer and marketers will often try to own a particular market niche using various strategies including pricing, distribution offers, promotions, competitions and packaging techniques.
Branding is based on the notion that proper communication concerning an item can only occur under the optimum conditions of the right time and the right circumstances (Aisedu, 2015). Therefore, the market takes the opportunity that presents itself as a window into the mind of the consumer and brings the idea of his product to the mind of the consumer with the perfect caption line. As such, the marketer will have achieved the branding by the packaging of the product and positioning by bringing the picture of the product into the consumers mind effectively (Downs & Haynes, 1984).
Brands are directly related to several elements of an organization. These features include name, the logo and slogan of the organization (Ghegerina, 2014). The items mentioned are admitted as crucial elements of the business and changing of these elements is considered as an important event. The term rebranding involves the processes of changing name, logo and repositioning. It is seen that the process of rebranding is often fruitful, but it involves certain risks (Hampf & Lindberg-Repo, 2011). It is important for companies to understand the opportunities presented by the process of rebranding and the barriers coming in the way of the success (Festcherin & Usunier, 2012). The rebranding process should be productive and yield positive results for the organization. Taking into the account the mentioned factors the organizations need to enforce the original perception of the brand as well as it is required to be ensured that the entire rebranding process responds to corporate identity.
LIDL is a German-based global discounts supermarket chain, established in the 1930s as the Schwarz Unternehmens Treuhand KG (LIDL, 2012). Operating over 10,000 stores in Germany and across Europe, the company presents one of the largest sales entities in the European Union currently. The company has had to undergo a brand and name change over the years of continued operations as it strives to change the customer perspective of the company (Moth, 2015). The company thus gives the best example of a change in the organization, especially with regards to brand change because of the move it made in the 1970s. With the initial name meaning black market, there was a lot of negative publicity about the company something that at the time needed to change. The then owner then bought the rights to the use of LIDL from a Ludwig Lidl for 1000 Marks (Furstenburg, 2004). Furthermore, there was a time when the information from the company came from internal sources and the management often gave interviews on the course of business at the enterprise. This became a concern for the company as there were many instances when the reputation of the company could come under jeopardy because of the release of sensitive information to the public (Navarro-Bailon, 2011).
As such, the company has also developed alternative methods of dealing with negative publicity in the course of operations, so that most of the information available on the company comes from the views of external analysts (Park, Park, & Dubinsky, 2011). The company has given a proper case study of how an organization can make use of important methods of change in the marketing structures. Different areas of strategic importance including the management, expansion techniques, employment conditions for the companys marketing team and labor relations in the various countries that the firm participates in will be used to determine the diverse strategies that the company has used. This study equally uses other companies at the same level to compare and contrast the application of marketing change strategies in their different environments as compared to the LIDLs case study.
1.2. Problem Statement
Repositioning or rebranding is the name of the strategy used by the organizations to establish a new identity. The processs objective is to obtain a new and different image of the organization in the consumers mind. The activities involved in the course of the repositioning are the formation of a new name, tagline or slogan, changing the design of the operations and reaching the new customer segment. Repositioning is a commonly used practice among the companies, and the trend of rebranding or repositioning is increasing rapidly at the global level. With the increasing rebranding in the world, the question arises about the impact of the process on the brand itself.
This was the case with the company LIDL during its name change in the 1970s. There was a need to improve the customer imaging from one that was thought to be selling contraband goods (and thus the low prices), to a store that gives significant discounts to clients as a method of expanding and maintaining customer loyalty (Moth, 2015). Research has linked the brand name of a store to the personality that the public views the store with (Downs & Haynes, 1984). Martineau's early work on the development of the store personality describes that there are five important parts of the store conceptualization process. There is a conceptualization of the retail image (Berry, 1969), identifying the attributes of the retail image (Shiffman, Dash, & Dillon, 1977), and measuring and analyzing the store image (Williams & Dicscenca, 1976). Others include examining the relationship between buyer attitudes and retail image (Swan & Trawick, 1981), and comparing the retail image held by the management to that held by the customers (Tillman, 1967). Downs & Haynes (1984) found that there was often a disconnect between the image held by the management of the store to that held by the populace.
The reasons behind the repositioning and the strategies adopted by the companies are different from each other depend on the objectives the companies are targeting (Wang & Shaver, 2013). LIDL is an organization which is undergoing rebranding or repositioning recently. LIDL has a good brand relationship with the customers and perceptions. LIDL is grocer providing the top quality goods to the consumers present all over in Europe. The organization has 10,000 stores located across the continent. The rebranding or repositioning of LIDL will be studied in this report, and the implications of the process on the identity, brand image and brand equity will be discussed. The research will focus on the rebranding as a process of repositioning. The process of repositioning affects the way the consumers think about the brand. Therefore, the focus of the project will be to analyze the consequences arising from the process.
The purpose of this study then is to determine the different ways in which the company dealt with the disconnect between management perceptions of change and the publics perception of the change. This company gives an excellent analysis of the change as the change was international in nature while there were different audiences of change. The purpose of this research is to determine how companies can deal with strategic change in the marketing approaches and how different audiences can be persuaded to perceive the changes in a similar way as the management of the company perceives it. This is because Downs & Haynes (1984) noted that there are often the different perceptions of the strategic changes that a company makes when viewed from the managements perspective and the buyers perspective.
The purpose of the research is to focus on the process of repositioning as a method of change to the organizational marketing strategies. There several consequences arising from the process of the repositioning (Sonnier & Anslie, 2011). The research will focus on the different implications arising from the rebranding process including differentiated perspectives of the change on the different recipients of the change. The impact on the corporate identity, brand equity and the image of the brand in the consumers mind will be discussed. Furthermore, the risks that are going to be encountered in the process of change, as well as methods of overcoming those risks based on LIDL example will be reviewed.
1.4 Research Questions
In the research, the researchers will be focusing on the questions how rebranding affects the corporate identity, brand equity and perception of the brand. LIDL has recently started rebranding through repositioning, and the researchers plan to focus on the repositioning of LIDL and the results of the process for the corporation. The researches plan to explain the effects of the repositioning on the brand image, equity and identity of the organization. The following research questions are going to summarize the research and its basis:
In what ways does brand repositioning affect different aspects of the brand corporate aspects including equity, corporate identity and brand image?
What does the organization currently claim about its brand and what is the future expectation concerning the LIDL brand change?
What could the brand community value about LIDL brand in future?
1.5 Research Limitations
The research is focused on a single firm LIDL. The brand has recently experienced the repositioning and is present in Europe (Smith & Burns, 2013; Sichtmann & Diamantopoulos, 2013). The outcomes of the research are confined to the analysis of the individual firm and cannot be generalized. However, the study has utilized the compare and contrast method to include the approach that other companies have used in the course of managing marketing strategy changes through repositioning to mitigate this limitation. The effect is that there will be a diverse approach to the research, sampling other companies in the course of the study.
As mentioned earlier, the ways adopted by the organizations for repositioning are different depending upon the objectives of the exercise (Shiffman, Dash, & Dillon, 1977; Smith & Burns, 2013). It is a possibility that the strategy adopted by LIDL may differ from the strategies adopted by other organizations as the objectives of LIDL were different. Again, the compare and contrast method that will be used in this study will ensure that the company has a proper balance of the analysis of reasons behind the strategic change that the company has undertaken.
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