IP rights strategy in practice: Arla Foods
For many years Arla Foods has dealt with IP rights, in particular trademarks, and the company is very aware of how important trademarks are to its success. Recently Arla adopted a new five-year company strategy in which brands and trademarks play a prominent role. In this context, Zacco/Eneretten interviewed Jakob Balling, Arla’s IP specialist.
What are the main points in your new strategy?
We have just launched a new ARLA brand and the new strategy means that Arla will have fewer and stronger brands. In future, Arla will focus on three global brands: ARLA, LURPAK and CASTELLO.
In addition, we have chosen a new international slogan, "Closer to nature", which will pervade all products, product development and marketing efforts. Naturalness is Arla’s new global direction and value position; therefore, at all levels of the organisation, "Closer to nature" will be incorporated into every activity. The slogan means that we are using natural ingredients in products and working towards removing any non-natural ingredients from products. "Closer to nature" is what Arla stands for.
What has made you change brands?
Previously we used a green logo as the company logo, a red logo across product categories and the ARLA cow in Sweden, which could be confusing.
We wished to create one overall global bland, and our choice of the green logo is in tune with the "Closer to nature" slogan.
A focus on three brands – why and how?
Thanks to mergers and acquisitions, Arla has many brands and for many years we have had a product brand strategy. This has meant that we have invested in too many marks in too many markets. We have realised that our ARLA brand is not sufficiently known on the global market compared to our corresponding investments. It is our view that collecting more products under, for example, the ARLA brand may have a synergistic effect on other Arla products and on the whole company. It is important to us that we have brands that are successful internationally, so our three strong brands need to be global.
Product names such as KÆRGÅRDEN will gradually become sub-brands of the ARLA brand. On the packaging, the size of the sub-brand logos will be reduced over time and the ARLA brand will increase in importance.
Thus, all products will fall under the ARLA, LURPAK or CASTELLO brands. The ARLA brand will be the largest from a pure production point of view and will accommodate all types of product. LURPAK is intended for butter products and blends, and CASTELLO is for first-grade cheeses.
Is it also a part of the strategy to downplay the efforts on certain markets?
We have decided to prioritise some markets as we have realised that we cannot have all product categories on all international markets. In this context we have identified the markets where it pays to make certain types of investment. Therefore, our new strategy includes expanding what we see as the home markets (ie, Denmark, Sweden, Finland and the United Kingdom) to include Germany and Poland.
Does your strategy mean that we cannot expect new products?
No - the opposite, in fact. We must also be more innovative and create more new products. The focus on innovation will be considerably increased. Over the past two years Arla has marketed about 250 new products a year. The new strategy is expected to result in an even higher annual output of new Arla products.
However, the innovation process must also use the "Closer to nature" slogan. The use of the concept involves a new challenge since new products may be more expensive to manufacture using purely natural ingredients. However, we have made a clear choice – using natural ingredients even though products may become slightly more expensive as a result. We believe that this is what consumers want.
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