Sobhagya Consultancy & Marketing Services-India

SECRETS OF BUILDING GREAT BRANDS

Published in Siddhant-A Journal of Decision making (RCMA, Bhubaneshwar) Oct-Dec 2014 Issue

 There was a time when ‘Dalda’ (Hindustan Vanaspati Ltd, now HUL) was synonymous for Vegetable Ghee (Hydrogenated Oil) sold inIndia. Similarly ‘Sintex’ a well known plastic water storage tank brand became synonymous with product or ‘Surf’ synonymous with Detergent washing powder. Several examples can be quoted. The underlying principle here is pioneering brands and the brand leaders. These brands not only popularised new products in market but maintained leadership and quality acceptable to customer. The latter can be assured through consistent delivery and standardisation of processes

Introduction:

The future of companies lies in building world class brands that can face challenge from international brand invasion in Indian markets as well as open up for them, global markets. The brands often reflect accumulated intellectual property-Unique product ideas, processes, patents, copyrights and state of the art technology, superior data acquisition and processing capability and not the least, tremendous  customer goodwill acquired by company over the years.

Brand is not merely a logo or design but it carries with it history/story, associations, images, feelings, experience, promises and of course expectations of consumers. In today’s competitive and crowded marketing challenges, brand is major support to create value in marketing. Without strong brand marketing team can hardly adjust to gruelling task of reaching out to customer and catch her attention.

“Admittedly, building winning brands is not an easy task. Successful global brands have been steadfast in nourishing their consumer franchise through ongoing innovation and remaining well ahead on the learning curve. Therefore, the challenge of building brands in competition with such established players is no mean task.....” said, YC Deveshwar, Chairman, ITC Ltd in 103^rd AGM, July 2014 address.

Brand is Identity of product that reflects trust and emotions in mind of customer- Many brands over the years have become synonymous to a product or product line (Example SKF, Surf). Brand reflects a great product and a great product is one in which customer sees superior value, year after year after year (Example, Cadbury). Hence branding is not two year phenomenon. A great idea or design may click with consumers for a short while but can’t last long, if not built around value.

If we take example of Surf (Surf Excel) it has faced rough weather due to low-end mass supplied Indian Nirma brand and high end Ariel of P&G both driving HUL to the corner who fought back valiantly to defend the brand.

“McDonald’s, once a byword for good service, has been ranked the worst company for customer satisfaction in America for nearly a decade – below even health insurers and banks.” The Economist wrote on April 10, 2003. Brands that lose direction often do so because they depart from their core values. IBM is another example of a great brand going down and then bouncing back.

“Continually search out what makes the brand unique. Customer preferences, competitive frameworks and market conditions are incredibly dynamic. Renewing and refreshing the brand to ensure continuing relevance, differentiation and credibility are the most strategic tasks. Brand managers must determine what cannot change and what must change”-says, Interbrand.

Brand is a continuum of successfully adapting to changes in business environment, technology and preferences of consumers shaped by changing lifestyles, awareness and standards of living, further complicated by globalisation of information and resources. Hence, brands have to fight battles throughout their existence, trying to remain relevant and at top (examples TV,Mobilehandsets and Computer manufacturers’ brands)

Either you got to be a major player as a generalist in any industry (Example Wal-Mart) or a niche market player with super specialisation( A leather Goods store) or else you are in the ditch, as observed under ‘Rule of 3’ studies (Uslay, et.al. 2010). In such market arrangement strong Brand helps a company remain afloat and at the top

Brand cannot be separated from Product and vice versa. Imagine sipping a cola drink blind folded and trying to identifying the brand and specific taste of drink. Not really easy. Some brands get into blood of consumers like Coca cola brand has become a part of American culture.

However, some brands transcend the product and become free entity like Polo (Ralph Lauren) or Calvin Klein. But such phenomenon called Brand extension is quite difficult breaking out from product line or at best product category. Even generalised slogans and tag lines don’t take brand anywhere unless these reflect some striking quality of product, like, ‘Utterly Butterly Amul’ by leading cooperative Producer of dairy products in India.

Advertising can only make the target consumers aware of product and its key attributes that consumers may hopefully value. But brand can only be built by first creating a clear brand promise (Say, 30 kilometres per litre by a petrol car) and then delivering that promise for customer satisfaction in both product and after sales support. Secondly, this experience has to be repeated and consistent. There is a specific zone of tolerance for each product/Brand where minor defects in product, delivery or service can be allowed by customer, for example, take-off of a flight up to 5 minutes beyond scheduled time of departure. The companies that deliver inconsistent quality or delay deliveries often can never build a great brand.

A brand cannot be built in short time unless it relates to a disruptive or innovative product concept that is launched by a company and quickly accepted by consumers as Industry standard in near monopolistic situation( I-pod, for example). The company gains this advantage as there is not much competition in market and it remains leader for some period. I-pod instantly appealed to young music lovers.

A brand can be built over time only with usage, quality and satisfaction delivered to consumers, repeatedly. A brand reflects perceptible value and emotional connect with potential customers. Brand is built only with consistent positive brand experience.

In management Institutes inIndia, for example, several private sector colleges have cropped up. Every year they spend millions of rupees on admissions advertisements in media but fail to attract students since these advertisements can create only awareness about admissions and not the desire (A high elaboration process). Hence they manage to attract those students who are rejected by their choice Institutes and not those who come to them because it was their choice Institute. Hence in effect most private Institutes are low rated by students right at entry stage not high rated as entrepreneurs tend to believe. They come unwillingly to participate in learning process. It is major challenge. When the student counters bad service the frustration is complete and image is severely damaged. In a few years the market reputation becomes negative and students simply disappear. To justify their failure, the managements of new institutes call it a shakeout.

While building a brand, customer view is to be considered. What are the attributes that target segment of these customers value? In this example of Institutes given above, most students prefer to enrol in state university campuses. Why? They see big value there in terms of low fees and the appreciation they receive for being at campus and not affiliated institute. Admission at campus shows the student is one of top rankers in entrance tests. So there is tremendous value to customer in University campus course. No amount of strategies, advertisements will work to divert students from university campus unless placement is guaranteed like in case of IIMs.

One way to judge if it is a great brand is by the market share it commands and the price premium a customer is willing to give. If a brand does not command at least 15% market share (however, this does not apply to personalised services like hospitals and IIMs mentioned above, as these always have small capacity) and 5% or more price premium to a generic/non-branded product, it is not a Great brand in opinion of the author. A brand cannot survive on its own unless it operates in market through adequate supply capacity. A brand that is not available in market has no value.