INNOTOOLS IP Course Suceava, 10 April 2008 Branding strategies in the forestry sector Davide Pettenella University of P

1. INNOTOOLS IP Course Suceava, 10 April 2008 Branding strategies in the forestry sector Davide Pettenella University of Padova - Italy

2. Outline Introduction: 3 innovation types Definitions: brand, brand name, logo Brand management Branding by SMEs The use of forest and wood images for branding Final remarks

3. Introduction 3 types of innovations in product development: • Absolute new products/services • Incremental innovations • Subjective differentiation

4. Very low Relatively high A. Absolute new products/services For wood products: • Rough material • Semi-finished products • Final products potentials for innovation

5. Laminated Veneer Lumber Pellets

6. Absolute innovations in forest services are more common Art in the forest: Arte Sella in Italy (www.artesella.it)

7. “Ecological” burial/funeral http://www.memorialecosystems.com/ http://www.promessa.se

8. In Iceland: • A lady (employed in a Bank) attended a course on wood working techniques organised in a forest area • Playing with some pieces of hornbeam for testing her competences she invented this object • Some friends liked the object as a Christmas present • She started to sell it in a small local shop Now (after 2 years): • 13 Euro • 5 minutes for making and painting one • She is employed part time in the bank • She earns 2500 Euro/month

9. Which lessons learned? • Absolute innovation: casual, not easily replicable • Patentable high individual profit, no positive impact on the local community • Non-patentable (very common in the forest sector): no stable sources of income (imitation)

10. B. Incremental innovations: improved products and services Some examples of products: • Charcoal with aromatic herbs • Chestnut flour with pine seeds and raisins to prepare, following a traditional recipe, the typical cake castagnaccio in Italy

11. Forest school Outdoor school

12. Key role in incremental innovations: adding to the normal products some special services • Sorting and grading system • Kiln drying • Packaging • Certification and (eco)labelling • Branding • …  Differentiation (Daria’s presentation)

13. Example of calibration system and sorting of marrons and chestnuts: calibration through number of fruits in 1 kg of nuts (http://www.conerpo.com)

14. Standardization and packaging of Christmas trees http://www.kollnitzer-tannenhof.com

15. Products’quality or performances Origins – typical products LCA, EU Ecolabel Organic farming IFOAM, EU rules SFM & COC FSC, PEFC Fairtrade Transfair Certification and labelling : of products Certification: of processes Quality Systems ISO 9000 Environmental Management Systems ISO 14001, EMAS Health & Safety OHSAS 18001 Social Accountability SA8000, AA1000, …

16. Examples of certified products: Christmas trees certified by FSC in Switzerland (WWF 2005)

17. C. Subjective differentiation Not a new product or an improved product or services, but an old product that is presented and perceived as a new one = Essential role of promotion • branding

18. A powerful instrument! • Absolute and incremental innovations without promotion (branding) are often unsuccessful (example: Red Bull) Developed in 1981 by a Thai businessman, sold as Krating Daeng by a pharmaceutical company; target market: truck drivers, farmers and construction workers Bought by the Austrian Dietrich Mateschitz (director of a German toothpaste company); sold in 1987 in Europe for a slightly different target, it became the 1st energy drink in the world

19. A powerful instrument! • Absolute and incremental innovations without promotion (branding) are often unsuccessful (example: Red Bull) • With branding (and the information associated to a brand) you can sell a product or a service based on one concept or on its opposite

20. “soft like the perfume of the oak” (?!) Promotion based not on real facts, but on subjective perceptions/believes

21. 1. Definitions • From a supply side: A brand is a name, term, design, symbol, or other feature that distinguishes products and services from competitive offerings (American Marketing Association) • From a demand side: a brand represents the consumers' experience with an organization, product, or service (The Chartered Institute of Marketing)

22. Brand: brand name and logo Brand name = a written or spoken linguistic elements of a brand. Normally a brand name has a trademark registration which allows to protect proprietary rights UPM-Kymmene Logois the graphic element associated to a brand; it may be a symbol, a word or a combination of them

23. Brand, brand name and logo Companies normally associate a brand to a slogan And sometimes to a mascot, a jingles or a reference product

24. Brand name Logo Slogan A reference product IKEA “IKEAfurniture, more than life”

25. Consumers’ loyalty 2. Brand management • The role of branding in the marketing mix: the 4 Ps of P. Kotler: • Product • Price • Promotion (advertising) • Place Products attributes Products prices a brand associated with a product or service should have certain qualities or characteristics that make it special or unique into the consciousness of consumers.

26. Brands as communication tools • A brand may communicate 4 elements; taking a Mercedes car as an example: • Attributes: “long lasting”, “prestigious, “expensive” • Advantages: “I will have not to buy a new car for five year if I am travelling in Romania”, “when I meet my clients they perceive me as a well-off partner” • Values: high performances, safety, prestige • Personality: “if this brand were a person, it will be a middle age, wealthy businessman” (= target market)

27. A good brand name should: • be legally protectable (Coca Cola ) • be easy to pronounce (Sveaskog ) • be easy to remember be and easy to recognize (Sony ) • attract attention (Ferrari ) • suggest product benefits or suggest usage (Nike ) • distinguish the product's positioning relative to the competition (Bic )

28. Types of brands/branding

29. Mercatone Uno retail company: an economy brand

30. Types of brands/branding

32. Types of brands/branding

34. Types of brands/branding

35. “Private” brands • With the emergence of strong retailers, the retailer's own branded product (“private brands”) emerged as a major factor in the marketplace. • Where the retailer has a particularly strong identity (such as IKEA, Marks & Spencer, Home Depot, …) this private brand may be able to dominate those companies which are not otherwise strongly branded.

36. Brand recognition A brand which is widely known in the marketplace acquires brand recognition. When brand recognition builds up to a point where a brand enjoys a critical mass of positive sentiment in the marketplace, it is said to have achieved brand franchise. One goal in brand recognition is the identification of a brand without the name of the company present

37. NikeCBSNBCBell Chanel In the wood-value chain the brands with a large international recognition are those of the retail sector

38. Best global brands= large concentration in few countries

39. 3. Branding by SMEs Branding a small business is essentially the same thing as a larger corporation, the only difference being that small businesses usually have a smaller market and have less impacts than larger brands. The real difference is in the potential in funding communication activities

40. Branding by SMEs • Co-branding: when two or more brands work together to market their products

41. Co-branding and Cause-related marketing: a type of marketing involving the cooperative efforts of a "for profit" business and a non-profit organization for mutual benefit.

42. Branding by SMEs • Co-branding: when two or more brands work together to market their products • Brand licensing: when a company sells the rights to use a brand name to another company for use on a non-competing product or in another geographical area

43. The “ecological panel” by the Saviola Group (a particleboard made totally from recycled final used wood products)

44. Branding by SMEs • Co-branding: when two or more brands work together to market their products • Brand licensing: when a company sells the rights to use a brand name to another company for use on a non-competing product or in another geographical area • Collective brand (umbrella mark): an homogeneous cluster of companies make use of a common brand

45. Development of a common brand A common brand may be based on: • Quality standard • A common territory • A region • A country: national brand • A common business • A common objective • Developed by: • Public institutions • Private organization • Partnership

46. Brands (ecolabels) defined by public institutions • EU Ecolabel • EMAS Registration of industrial sites • Environmental Product Declaration

47. Normally voluntary brands, but starting from 2007 compulsory CE mark on wood used in construction in the EU

48.  Common standards: well-managed forests Examples of collective brands defined by private organisations

49. “Vero Legno” brand A collective brand to inform consumers on the real components of the final product (no use of plastic or melanine sheet, but “true wood” veneer sheets) http://www.verolegno.it/

50. MÖBELFAKTA A reference system for furniture quality determination. The Möbelfakta system has existed in Sweden since the 1970’s but development from 1995-97 has improved its content and appearance as well as adapting it to modern requirements and test methods