Sm Business Model

Designing, developing and achieving successful brands are perhaps the most difficult tasks a marketing professional will ever incur. The importance in building brands includes the answer to the question that a brand manager shall implement - “Know Before You Start” - at every moment. The challenge of developing a brand model for SMEs is easier to observe at all the opportunities that arise and to “filter effectively” all the different approaches and factors that affect the brand equity. In most articles the challenges are not presented from the perspective of SMEs, therefore some of them will be more important than others for this purpose. These challenges (or obstacles) are mentioned in this paragraph to have insight about them and to give

Aaker (1996) describe eight factors that make the brand building process hard to implement successfully. For a brand there are many pitfalls that have to watch out for. These factors are described further below.

Pressures to compete on price
In today’s economy strong retailers are leading for price competition on many products. For the consumers it feels like an industry norm. Aaker (1996) claims that private-label brands are very limited to low-quality and low-price products a decade ago. Nowadays, retailers became continent for this and beside the so-called price brands at the same time they created a private-label brands to reclaim higher price (i.e. Monoprix and “Monoprix gourmand”). The difference is that now the costs can be divided over hundreds of products that increase even more pressure on prices.

Proliferation of competitors
This factor points to the face of increasing numbers of competitors. An increase in the numbers of competitors leads to decrease in possibilities to communicate a unique identity. This forces companies to position their brands more narrowly and target a smaller market. Further, new and desperate competitors get more motivated to take more risky approaches or to copy what has been successful in the past. This trend can result in a destabilization of competitive

The brand most often suffers more than the company gains from their effort to diversify and the overall outcome is negative.

Pressures for short-term results
The aim to make fast results, instead of working with a long term focus is a major factor when it comes to being competitive in branding according to Aaker (1996). As a result of the search for short term results brand-building programs is often sacrificed.

When learning the trace of a brand model for SMEs it is important not to look only at opportunities, approaches and challenges of building a brand. It is important to look at it from the perspective of SMEs. The next section will therefore present some guidelines on how branding could be dealt with within SMEs. These guidelines from (Lassen, Kunde, & Gioia, 2008) are presented to get an insight on what recommendations on branding the existing literature gives to SMEs and to be able to draw from them when developing the brand model for