Harman Pushes Brand Synergy In Marketing Campaign

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STAMFORD, CONN. — Harman International has launched a major marketing campaign that it expects to boost sales of its consumer, professional and OEM automotive products.

The campaign will promote that its 15 audio and automotive infotainment brands belong to a single company with more than $3 billion in annual revenues.

Harman is boosting its worldwide consumer-brand marketing budget by 45 percent beginning July 1 following a year of austerity budgets. The budget includes its Harman Consumer and Harman High Performance AV groups as well as OEM autosound.

Harman’s new “corporate identity architecture” will “transfer brand loyalty and trust” from one brand to another, encouraging purchasers of one consumer, pro-audio or OEM autosound/infotainment brand to buy other Harman brands, chairman/CEO Dinesh Paliwal told TWICE.

“Our brand synergy has never really been exploited,” he explained. “We are a house of brands, and our strength is our legendary brands,” which include such consumer brands as AKG, JBL, Harman/ Kardon, Infinity, Lexicon, Mark Levinson and Revel.”

Paliwal added, “By strengthening the association among these brands under one high-profile umbrella, we will demonstrate the Harman passion for innovation and financial strength are the unifying factors for value-added audio and infotainment solutions of virtually any scale.”

The new strategy accompanies a change in Harman’s brand identity. Harman International is shortening its name to Harman and adopting a new logo. “We need a crisp name to resonate with our loyal fans and with the younger generation,” Paliwal explained. The new logo features the word Harman appearing on a steel-blue field, replacing a stylized orange “H” in use since 1980.

Harman also adopted the tagline “Where Sound Matters” to celebrate almost 60 years in the audio industry, beginning with the launch of the Harman Kardon brand by Dr. Sidney Harman and Bernard Kardon.

Harman will “put a heavy foot on the gas pedal” in the coming months to promote its house-of-brands strategy, Paliwal told TWICE. The efforts starts today with full-page ads appearing last Thursday’s Financial Times, The New York Times and Wall Street Journal. A four-page wraparound appearing on the May issue of Fortune will follow.

Consumer product packaging, literature and advertising will begin appearing “almost instantly” touting the association, including the integration of the “by Harman” tag with all brand logos. The company will also use its multiyear deal as an official partner with the Grammy Awards to promote its brand family, as will new JBL and Harman Kardon Facebook pages and the Web sites of individual brands.

Automaker ads that promote sound systems carrying a Harman brand will also tout the Harman association, Paliwal said. Automakers “want us to promote the Harman umbrella of brands to consumers,” he added. “The automotive business is our biggest business for branded audio,” he noted.

In boosting the consumer-brand marketing budget, Harman will launch a “communications campaign to support major product launches,” said Eric Plaskonos, brand management and marketing service VP for Harman’s consumer brands worldwide.

The announcements accompanied the release of a third-quarter financial report showing Harman operated in the black for the third consecutive quarter following several quarters of major losses.

Harman has a stronger bottom line to support the marketing budget. Worldwide net sales grew 42 percent in the fiscal third quarter to $848 million and by 14 percent for the first nine months to $2.54 billion. Net income hit $18 million in the third quarter, compared with a year-ago loss of $69 million, and net income for the nine-month period hit $25 million, compared with a year-ago loss of $427 million.

The only division to post a third-quarter operating loss was the consumer division, which lost $1 million for the quarter but posted a $6 million operating profit for the nine-month period. The thirdquarter loss was down from the year-ago $8 million loss, and the $6 million ninemonth operating profit contrasts with a year-ago loss of $35 million.

Consumer sales were up 18 percent in the quarter to $81 million and up 2 percent for the nine months to $292 million.


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