Brand Offering: The Deep Or Wide Strategy?

Mark Di SommaAugust 25, 20144 min

A great piece in AdWeek on the failure of single-item brands is a reminder of a question that comes up a lot: whether to dive deep or go wide. Specialty vs diversity.

Both are attractive. For some brand owners, the opportunity to offer a detailed and nuanced offering within an area is the embodiment of singularity. In a complex and cluttered world, this argument goes, there’s power in being known for one thing. There was a lovely story in The New York Times International recently about Michael Vachon who was writing software until he discovered that there was a real interest in upstart American distilleries in London. Cue Maverick Drinks, catering for a renewed interest in American spirits. It’s a great story based on a growing need. So success, right?

Yes, but as the AdWeek article points out, vulnerability also. A fashionable rush on a specific item is usually followed by an equally unfashionable rush as consumers move onto whatever captures their attention next. That’s the shortfall of being a bright shiny object. At some point you fade. If you’ve expanded resources and footprint in the meantime to meet current and anticipated demand, the  sudden departure of consumers in droves quickly leaves you on the rocks. The disappearance of Crumbs was the latest in a long line-up of one-hit brands that have gone the same way.

Diversity can also look very attractive. Here, the attraction is to expand the offering into new markets in order to trade on current equity and to attract new customers. Again, the theory has its merits – capitalize on your reputation and provide your customers with more opportunities to engage with you more often. There comes a point though when brands can expand so far beyond their core business that they either mean nothing to their consumers anymore (because they’re trying to be all things to all people) or they lose sight of where they began. Starbucks, famously, lost sight of its core business of coffee in its bid to establish footprint before self-correcting.

So often, the options are presented as alternative growth strategies. Increasingly though, brands need to build both horizontal and vertical axes into their offerings. There needs to be enough depth in what they do for them to be credible in the area they most want to be known for. Depth brings opportunities for immersion, catering to those who want to explore the subtleties, opportunities and variations to what’s on offer. At the same time, the offering must be wide enough to continue to give people options. As Nancy Kruse points out in the article Starbucks, Dunkin Donuts and Krispy Kreme are all known for one thing but have successfully expanded their offerings to include a wide range of items that are now presented as natural companions.

Mapping how this multi-directional approach plays out on both plains starts with questions that should be informed by purpose, strategy and competitive advantages and measured for effectiveness against growth plans:

1. What do you most want to be known for? And how do you show that you are well-versed in this area? What do you want people to discover more about? Where can the journey take them? (the vertical journey)

2. What else could naturally accompany this? How do these accompanying products/services inform your core product? Why are they a natural “progression” of what you’re known for? How do these extensions add to how people perceive you? How do they contribute to the fulfillment of your purpose? How far should this suite of accompanying products/services extend – and where does it stop? (the horizontal journey)

In an upgrade culture, however, you cannot simply set and forget your offerings on both axis. Rather, brands must continue to evolve what they offer on both axis in an ordered and consistent way. There are ongoing questions that will assist you to do this:

What must stay?

What must we keep and continue to improve?

What should be discontinued?

What could we introduce?

Where can we go next (in terms of markets?)

That simultaneous development of brands and ideas along both axis forms the basis in my view for a sound portfolio strategy. It ensures that your brand builds on what it has and is known for and, at the same time, introduces new ideas and services that complement and add value to your reputation.

Recently Coke bought a stake in Monster, increasing its footprint in the energy drinks market. This week comes news that it will begin testing Coca Cola Life in the US to assuage  consumers’ desire for lower-calorie soft drinks. At face value, those strategies are contradictions. In reality, they are a succinct example of a seasoned brand owner testing the market in different directions to determine where it will extend its offering (into the energy drinks market) and where it will deepen (introducing another low-calorie option to its existing line-up).

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Mark Di Somma

4 comments

  • Darren Coleman

    August 27, 2014 at 11:37 am

    Interesting article and insight. Thank you for sharing. I think the lynch pin that’s potentially missing in this article is a well defined and understood brand essence. This provides clear parameters for which markets a brand can / can’t stretch and / or extend to. It distinguishes brands like Virgin from BA and Nike from Head. The latter have essences which facilitate movement into a broad range of markets without diluting their positioning. That latter don’t so they remain associated with a niche (or small number of niches) which they struggle to develop up.

    • Mark Disomma

      August 27, 2014 at 9:35 pm

      Point well made Darren – and my oversight. I completely agree with you. A powerful essence will indeed provide the very parameters required. Thanks for adding.

  • Michael Vachon

    August 27, 2014 at 3:29 pm

    Hi there,

    Thanks for mentioning the article in the New York Times. There has been a great interest in American Craft Spirits here in the UK, but I reject the notion that they might be a fad. What consumers and the drinks industry are most attracted to is not that they’re new or even different, but the craft that goes into making them and the craft spirits scene, as a whole.

    Many food and drink trends start in the US before they make their way over to the UK. Craft beer really took off in the United States 10 or so years ago and has seen an explosion in the past 2-3 years here. Gourmet food trucks, practically common place in many major US cities are only a revelation in the UK over the past 1-2 years.

    Craft spirits are increasing in popularity the US with at least one craft distillery in every state and, just as with the other trends, we’re seeing a growth in the preference for spirits made from independent producers with a real point of difference here in the UK.

    As people become more educated about what they’re consuming (and have more access to information) this trend is only set to continue.

    Cheers,

    Michael

  • Mark Disomma

    August 27, 2014 at 10:05 pm

    Michael – thanks for your response. Personally I was hugely inspired by your story. Your acuity in spotting the gap in the market, and indeed in continuing to cultivate depth in your offering, is commendable. As you point out, there is growth and depth in the craft distillery and education will drive that further. Only you can answer the “what’s next” for your brand and how you will build on your story – which I’m sure you have. My statement about vulnerability was directed at brands that have achieved initial success and have not thought about how they will develop further going forward, that over-commit themselves because they read too much into initial reactions or that spread themselves too thin in a bid to dragnet their sector. Clearly you have a pipeline, a viewpoint, focus and great passion. Best wishes for your endeavours. Bring on a more craft-conscious world …

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