Haier’s High-End Brand Casarte: Can Multi-Branding Work?
(7 pages of text)
In 2015, the management of Haier Group (Haier), a Chinese company that designed, developed, manufactured, marketed, and serviced home appliances, faced a dilemma. Established in 2007, Casarte, Haier’s high-end sub-brand, had sustained only a mediocre performance from 2007 to 2014, and its sales revenue had remained low. Had brand cannibalization occurred between Haier’s mid-range to high-end products and Casarte’s high-end offerings? Should Haier continue to develop Casarte, which would require more risk and investment? Or should it cut its losses and discontinue the business, which could hurt Haier’s ability to compete in the high-end market?
This case can be used in undergraduate- and graduate-level courses on marketing or strategic management. When used in strategic management courses, this case will provide students with the opportunity to do the following:
- Apply a strengths, weaknesses, opportunities, and threats analysis to comprehensively and systematically analyze the external environment and internal resources that existed when the brand was created (or as the brand developed).
- Using the Boston Consulting Group matrix, describe the brand’s performance at different stages and formulate corresponding development strategies.
- Learn to identify or estimate cannibalization between brands and products in multi-brand operations, clarifying the causes and solutions according to different types of cannibalization.
When used in marketing courses, this case will provide students with the opportunity to do the following:
- Analyze brand positioning.
- Apply strategic materials for the four Ps of marketing (price, product, promotion, and place) to understand the rationality of the combination of marketing elements.
China, Large, 2015
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