IMMEDIATE RELEASE
Contact: Cheryl Kraus
Bain & Company
+1-646-562-7863
cheryl.krauss@bain.com
Bain & Company Names 'Brand Growth All-Stars'
in Landmark Analysis of 8,000 Brands
Study Finds Innovation and Advertising Potency
Increase Odds of Success; Price Discounting Often Has Opposite Effect –
Only 1-In-5 “All-Stars” From 2001 Continue to Perform
NEW YORK, NOVEMBER 15, 2006 – Based on a far-reaching performance analysis of 8,000 diverse consumer brands in 100 categories from 1997 through 2005, Bain & Company has named 17 consumer products as “Brand Growth All-Stars.”
Bain’s roster of “Brand Growth All-Stars” includes Arnold (fresh bread and rolls), Barilla (pasta), Crest (toothpaste), Edy’s (ice cream/sherbet), Honey Bunches of Oats (cold cereal), Ice Mountain (bottled water), Johnsonville (dinner sausage), L’Oreal (facial cosmetics), Marlboro (cigarettes), Maybelline (facial cosmetics), Nature’s Own (fresh bread and rolls), McCormick (gravy/sauce mixes), Neutrogena (facial cosmetics), Old Spice (deodorant), Pepperidge Farm (cookies), Rotel (tomato products) and Wheat Thins (crackers).
“A steady drumbeat of new product innovation, accompanied by substantial advertising, improved the odds of success for the “Brand Growth All-Stars” and other top-performing brands,” explained John Blasberg, head of Bain’s North American Consumer Products Practice. “Significant price discounting tended to have the opposite effect, making brand growth much more of an uphill battle.”
Bain found that brands achieving stronger growth were 41 percent more likely to innovate and surpass category averages with new product introductions. Brand leaders were also 45 percent more likely to exceed their category averages in terms of advertising. When viewed together, companies were more than 50 percent more likely to be a category leader and find themselves ranked on Bain’s “Brand Growth All-Star” list.
Significant pricing discounts, however, were not typically associated with winning brands. Growth leaders proved 31 percent less likely to cut prices. On average, the faster-growing brands discounted at least 2.3 price points less than the slower-growing brands.
Bain recommends that consumer brands seeking growth leadership closely monitor the extent of their innovation, advertising and discounting, compared to the industry averages in their product categories.
“Consumer products category leaders have struggled in maintaining their ‘Brand Growth All-Star’ status,” explained Ivan Hindshaw, Bain partner and author of the brand growth study. “Only one-in-five companies that made the ‘Brand Growth All-Star’ list in 2001 made the squad again in 2005.”
Across the wide spectrum of 8,000 brands covered in its study, Bain found essentially a level playing field where any brand could be a growth winner in its category. Size, premium or value positioning, and other category dynamics appeared to have no influence on the ability of an individual brand to achieve growth leadership.
For more information about Bain & Company’s Brand Growth Study, or to schedule an interview with John Blasberg or Ivan Hindshaw, please contact Cheryl Krauss at email: cheryl.krauss@bain.com or 646-562-7863, or Christopher Fox at email: christopher.fox@bain.com or 646-290-6103.
About the Brand Growth Study
Bain & Company’s study of brand growth leadership follows up on the global business consulting firm’s notable 2001 study of winning brands from 1997-2001. To rank as a current “Brand Growth All-Star,” a brand must have been a winner in the 2001 survey as well as in the latest analysis covering 8,000 brands in 100 categories from 2001-2005. Only 19 percent of the 1997-2001 top performers remained winners in 2001-2005.
About Bain & Company, Inc.
Bain & Company, a leading global business consulting firm, serves clients on issues of strategy, operations, technology, organization, and mergers and acquisitions. The firm was founded in 1973 on the principle that Bain & Company consultants must measure their success by their clients’ financial results. Bain & Company clients have out-performed the stock market 4 to 1. With offices in all major cities, Bain & Company has worked with over 2,700 major multinational, private equity, and other corporations across every economic sector. Additional information is available at www.bain.com .
