Types of Branding

Branding is the practice of giving a specified name to a product or group of products from one seller. The specified name creates individuality in the product; hence, it can be easily distinguished or recognised in the market from the rival products.

The sole purpose of branding is to distinguish your branded products from those of competitors. A well-promoted brand name which has earned reputation in the marketis very difficult to compete with.

The term brand is broadly applied to all identifying marks such as trade names, trademarks, trade symbols, picture, design of the package, distinctive colouring or lettering with or without some attractive slogan.

The owner of a registered brand personally stands behind the branded product and offers personal guarantee for maintaining the quality and the standards of the product as per advertisement.

A brand is a term, name, sign, symbol, design, or a combination that identifies a company’s product from its competitors.

The brand mark is a symbolic or pictorial design or logo that identifies a product along with its brand name. It is also the legal way by which the owner claims exclusive access for trademark purposes.

Some of the types of branding:- 1. Experiential Branding 2. Co-Branding 3. Umbrella Branding or Corporate Branding 4. Rural Branding 5. Green Brands 6. Digital Brands 7. Luxury Brands.

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Types of Branding: Experiential Branding, Co-Branding, Umbrella Branding, Rural Branding, Green Brands, Digital and Luxury Brands

Types of Branding – Experiential Branding: Definition, Strategic Framework, Advantages, Disadvantages and Future

Definition:

Experiential branding is ‘about generating experiences for a brand using both visual and message communications and other elements like colours, ambience, superior customer service, positioning, etc., so as to create memorable experiences and increase the loyalty among the consumers’. – Dr Y. RamKishen

Brands which create experiences and leave everlasting impressions through the use of senses in the minds of the target consumers are called experiential brands.

Strategic Framework for Experiential Branding:

1. Why create experiences?

An Experiential brand differentiates itself from the clutter and builds emotional bond which leads to loyalty of the customer.

The main reason why companies or market opts for experiential branding is as follows:

i. Brands have to Create Experiences for Better Positioning:

The experiences are the ones that stay with the brand. People remember the brand with the experience that they had while contacting the brand which means all the communication, advertisements, visiting the stores or customer support, etc., are all touch points for consumer experience. For example, a Harley Davidson is not a motorcycle, it’s a multifaceted culture. Nike is not about purchasing footwear rather about victory and achievement.

ii. To Differentiate from the Clutter:

The experience that the companies are able to generate with the customers stays with them longer than any promotion they might have seen. If the consumer feels connected with the brand; it is more likely that they will be associated with it. For example, Southwest Airlines portray everyman imagery with great accessibility. Thus, it is able to connect with specific emotions, desires and lifestyles.

iii. To Affect the Subliminal Mind of the Consumers:

When the brands decide to go for experiential branding they make an impact on the senses. There by affecting the subliminal mind of the consumer. Thus, the experience generated stays with the customer for long.

For example, Starbucks Coffee offers a very distinct coffee colour pallet with coffee names having colour names like red, green and yellow at the end. All these colours transcend their stores, logo imagery, and market and they create a holistic experience for the customer.

iv. To Generate Brand Experience through Salience:

Disney Land and Disney World use the brand salience and create 262 touch points at Disney from the time you enter the Disney World. Thus, one experiences the brand in an enamored way. Disney is a service and they use POD’s (Points of difference) to establish their brand with the customer and generate a relationship with them.

v. To Repeat Customer and Spread Word of Mouth:

A repeat customer is ten times cheaper than the amount to be spent to win a new customer. And if the customer himself/herself becomes an advocate of the brand and spreads it by word of mouth then it becomes an effective advertising. Most of the hair care, skin care and spa brands resort to this type of experiential branding. For example, Asian Spa of Singapore.

2. How to create experiences?

The total customer experience depends on a lot of factors. For example, apparel brands like Levi’s, Lee, etc., work on the traditional ‘Shopper’s Journey’ concept in order to build experience in their branded environment.

The understanding about the shopper is that, he gets attracted to the store due to store front (facade and window displays) which entices him to move into the store, once inside the store he is presented with a retail story, he explores and finds out what he wants after which he is made an offer and the sale takes place.

3. Use the Five Senses or any of them:

The five senses are- touch, hear, see, smell and taste. Brands have to use either of them or a combination of these to create an experience for their customer.

i. Hear:

Based on the capability of the touch point to influence the mind of consumer through his ears:

a. Word of Mouth:

The customer might hear the word of mouth before deciding on a brand. The Indian society is highly driven through references. So someone’s experience with the brand good or bad will be narrated to another 20 people. Two interesting aspects about this touch point are firstly, it is not directly controlled by the brand and secondly, this influences consumers to try the brand/product. However, it is built through consumers’ experience.

b. Music:

Another strong touch point available with the brands for influencing the subconscious mind of the consumer is Music. Music shapes the mood of the consumer which translates to his actions in the store. For example, McDonald’s use music to make people eat faster. Similarly, music is used in almost all apparel stores to pep up the mood of the consumer and make him feel special and worth it to purchase original branded attire.

ii. See:

It is based on the capability of the touch point to influence the mind of consumer through his eyes. For a retail brand what comes to the eyes will be the store format, layout, visual merchandizing, store maintenance, etc.

For example a Reebok or Levi’s store window will have a set of mannequins wearing the entire range of clothing and footwear from the brand. Usually Facade is the element which builds consistency and visibility of the store with respect to brand and window attracts and tempts the consumer to walk-in the store.

iii. Smell:

The best way to build consistency in the sub consciousness of the consumer about the same brand stores is to build it through consistent smell. For example, Cafe Coffee Day stores are available across various sizes and layouts; however, the unique identifier is the theme colours and the aroma. The smell usually is like a persistent whiff.

iv. Touch:

The touch refers to the emotional connect which the shop staff is able to get with the shopper while interacting with him in order to sell him the merchandize. The sooner the staff is able to get pass his mind and start talking to his heart, the easier the sale becomes.

v. Taste:

The shopper develops certain expectations about the product and interaction experience with the staff. This touch point does not affect the current purchase; it affects the next purchase, because if the product or serving given to the consumer is not according to the expectations, it will create a negative impact.

4. Implement the Experience and Relate It to Brand:

The brand using the five senses or the relevant one, should implement the strategy to create a meaningful experience for the customer. For example, Manchester United Club creates an experience by playing matches in store; the ambience of the store has shades of United Club colours and other accessories and pictures of the players on the walls.

5. Experiences Generate Customer Loyalty:

Experiences create loyal customers. The customers get accustomed with the same experience and start feeling at home. There have been numerous studies over the years, proving that loyalty is characterized by an emotional and behavioural response. As the competition is increasing in the market, it is becoming more and more cluttered.

In such time connecting with the customers at a level where their loyalty can be achieved is not so easy. It can only be attained by connecting with them at a much deeper level of understanding of their needs and aspirations and showing sincerity to your customers.

It is extremely important for brands to develop emotional bonds and relationships with their consumer and that is best done through experiential marketing tactics. For example, Shopper’s Stop uses VM (Visual Merchandizing), fragrance, etc., and has been able to maintain a loyal set of customers who are the members of their club ‘first citizens’.

Advantages of Experiential Branding:

1. To Break the Clutter:

No brand can survive on transactional tactics like new menu offering, quarterly promotion, additional frequency points, and media hype. To break the clutter and make an impact on the customer’s mind about the brand, the experiential brand uses sensory branding to appeal to the senses and differentiate.

For example, consider an experience with Jet Airways. While checking in, flight stewards greet gracefully and direct us towards our seats. Water is served to the customer (to make them feel comfortable) or juices (taste) are offered according to preferences and food is served during the trip.

Whenever a Jet Airways flight takes off, fragrance of incense sticks linger within the flight (smell). Thus, a combination of touch, taste and smell make it a complete flying experience.

2. Consistency in Delivery and Experience:

Experiential brands strive for ‘holistic experiences’ that dazzle the senses, appeal to the heart, challenge the intellect, and are relevant to people’s lifestyle and relation appeal. To maintain the brand image, consistency in delivering the experience is necessary.

For example, Palace on Wheels is considered one of the top 10 train journeys in the world in terms of the quality of service they provide. They offer royal ambience, food and service as was observed in royal households of the past. Any discrepancy in the quality of the service will damage the brand -‘Palace on Wheels’.

3. To Establish an Emotional Bond:

Experiential brands deliver their own set of values and beliefs to touch emotions of their customers. Experiences do not happen by chance, they need to be planned. Pre-defined and pre-positioned sensory cues are a part of an experiential brand. These cues may be visual, aural, aroma, tactile or even taste that helps to relate a brand with an experience.

For example, Walt Disneys’ amusement park situated in Orlando, appeals to a child. The exciting rides human beings dressed as cartoons leads the visitors to the make believe world of cartoons, establishing an emotional bond by appealing to their sense of touch, vision and hearing. The park is a combination of cool tranquil colours to soothe the mind.

Disadvantages of Experiential Branding:

1. Absence of an optimized match between perception and reality may shatter the brand:

Perception varies from individual to individual. The same commu­nication may be perceived differently based on the psychographic and behavioural differences. For example, if a retailer store is putting a strong perfume in their account, it can be a turn off for some consumers as they may be allergic/may not like the perfume.

2. Any inconsistency in delivering the brand promise will adversely affect the brand image:

Even in case of experiential brand, it must stick to the core brand proposition and never deviate from it. Any deviation may wear away the brand equity. As experiences are intangible measuring the quality aspect would be a huge challenge for marketers. No matter how great experiences are generated a single brand cannot satisfy the entire market. However, some brands take pains to offer what they promise as an experience.

Mc donald’s promises delivery after the order is placed in 1 minute failing which they provide one pack of French fries free. Domino’s Pizza has mastered to deliver the products at your home within 30 minutes once the order is placed.

3. Experiential Branding may not be suitable for mass only suitable for niche brand:

Experiential Branding takes a lot of effort and investment to create touch points for the customer. A mass brand cannot invest in the same way as the other premium brands. Wal-Mart is a mass brand and cannot generate the experiences like J.C. Penney or a target store in retailing.

Future of Experiential Brands:

With the advent of competition and increased awareness, brands are fighting themselves in a clutter, therefore experiential branding will be the future. Great brands like Disney, Southwest Airline (SAS), Nike, Barista, Shopper Stop, etc., have created experiences which are memorable and would be cherished by the consumers for a lifetime.

Experiential Branding is an offshoot of Experiential Marketing and it will drive the future of branding in developing countries like India, China, Vietnam, and Brazil. Experiential Branding is already popular in USA and Europe.

In the future, smart products and technology products have to survive only by providing experiences to the customer be it in convenience of usage, generating more value and gratifying the sense of the individual.

Today, the world talks about 3D laptops, smart phones with sensory functions, high end audio-video products automobiles that can think and entertainment brands like Nintendo that can create real time experiences in their gaming products. Hollywood also joined the band wagon and designed a movie Avatar using advanced Techtronic by creating animations that are generating real experiences.

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Types of Branding – Co-Branding: Meaning, Prerequisites, Strategies, Factors, Advantages and Disadvantages

Meaning of Co-Branding:

Co-branding is the practice of using multiple brand names together on a single product or service. The term can also refer to the display of multiple brand names or corporate logos on a single Website, so that people who visit the site see it as a joint enterprise.

When effectively done, co-branding provides a way for companies to combine forces so that their marketing efforts work in synergy. For example, a sachet of biscuits or powdered milk with a pack of tea could be cited as examples from the local market. This kind of co-branding has taken place in the recent past 2005 and 2006. The main source brand that leveraged biscuits and powdered milk was Lipton.

On the Internet, co-branding can provide benefits to the involved businesses by enhancing product or service exposure to consumers, marketing new products and services, and making consumers or clients aware of the core competencies of each enterprise.

Co-branding can also be used to target specific markets with advertising by means of banner ads, logos, or links in descriptive text, maximising the likelihood that potential buyers will learn of the existence of a particular company, brand, product, or service. Unilever has started selling its ice cream brand (Carte D’ or) imported from Turkey through KFC outlets in Karachi.

The company plans to roll out to other markets soon. It has chosen a channel compatible with its brand that sells by the scoop and not as packaged ice cream. Anyone walking into a KFC joint cannot ignore the ice cream.

According to Kotler, “Co-branding is the two or more well- known brands combined in an offer and each brand sponsors expect that the other brand name will strengthen the brand preference or purchase intention and hope to reach a new audience.”

Co-branding is also called brand Bundling or Brand Alliances which is occurred when two or more existing brands are combined into a joint product or are marketed together in some fashion.

Prerequisites of Co-Branding:

Conditions that contribute to the success of co-branding include:

1. Both brands are easy to identify based on their product or trademark.

2. Both brands provide different variety of items, which are considered to be the best value for the price.

3. There is enough demand for both brand products on a regional, national or international level.

4. There is a symbiotic relationship between the two brands.

5. Brands are compatible with each other.

6. Both brands should have identical personality characteristics.

7. Both brands should bring different products and/or services.

8. Brands should be aligned vertically and not horizontally.

From the consumer’s point of view both brands should be considered as united, monolithic entity and not two separate brands running, side by side.

Co-Branding Strategies:

Co-branding can take three forms:

1. Ingredient Branding:

In this form, a basic ingredient of the product is mentioned next to the actual products name. The advantages are that both brands can benefit from the symbiotic effect of combining two strong brands. For example, many desktop manufacturers use the Intel Inside’ mark along with their brand names to benefit from the image of Intel chips. None of these companies can individually make a dent in the market. United, yes, they stand tall in the market.

2. Co-Operative Branding:

It is the joint venture of two or more brands to form a new products or service, where both brands are well established in their respective segments. Each helps the other in improving the awareness of the other brand. A very good example is Jet Airways-Citibank Credit Cards. Both are leaders in their segments and have now come together to enhance their market share with their combined efforts. Customers also gain by using the facility.

When they use the Citibank credit card to book a Jet Airways ticket, they accumulate credit points, which can be exchanged later for some other service benefits like discounts in the value of tickets or gifts. Apart from offering discounts, this strategy also leads to improving the brand image and should motivate customers to become loyal to these brands.

3. Complementary Branding:

It involves the marketing of two brands together to encourage co-consumption or co-purchases, such as a bottle of Coke with McDonald’s burgers. McDonald’s thus restricts the availability of Coca-Cola’s rival, Pepsi, in its outlets ensures more exposure and visibility to Coke. Coke in combination with McDonald’s also increase the brand image of the two complementary brands.

Factors to be Considered in Co-Branding:

Owing to the benefits, one may think that co-branding is the best strategy for certain situation and falling into the trap without looking for particular factors to be considered may cause more harm than benefit.

Hence, the strategic areas that require a closer look in co-branding activities are discussed below:

1. Partner Choice:

In component co-branding, choice of the partner becomes the critical issue. The component manufacturer should necessarily consider the strategic implications and the long-term effects of such interaction. The final product manufacturer may look out for the price premiums, profits, market expansions, etc., from the alliance while the component manufacturer depends upon the consumer evaluation of the branded component, and its implication of the future sales. Both partners have to take into account the post alliance attitude of the consumer. Any mismatch could lead to damage of equity to both or any of the brands.

2. Product Pricing:

Pricing of the product is another major decision to be made. One of the reasons behind price bundling is to claim premium; but the tricky question is – what is the amount of premium that can be actually charged?

Evaluations have to be made to identify the ideal price- level where the consumer actually derives value due to the addition of the branded component. Before this, a study has to be made on whether the pay-off to the consumer is high enough to justify a price premium with the branded component. Other issues further complicate this decision like what are the price premiums when the partnering is between branded component and an unbranded one and what are the price premiums when both are branded?

3. Promotion:

Deciding the promotion mix and the ratio of exposure and spending by both the brands is the next level of decision that has to be made. This would flow from the level of involvement of the branded component in the alliance. It also derives from the equity that would flow to both the partners from exercise.

A strong branded component might result in the other partner undertaking all promotional expenditure, just to be associated with the brand. Intel is a case in point. However, when the benefits derived are mutual, a ratio of sharing expenditure has to be worked out, as in the case of Diet Coke containing NutraSweet. At the other end, the manufacturers of the branded component themselves undertake promotional expenditure on their own where MRF tyres advertises that it is the OEM for MRF , Opel Astra, Fiat Uno, etc.

4. Asymmetry in Gains and Losses:

Offering a product with branded components may not be equally beneficial. The dominant role of one branded component will affect the value of the partner; this would result in unequal gains and losses brought about by the interaction, as assessment of this will have direct implications on the choice of partners and the pricing issue.

5. Consumer Preferences and Co-Branding:

This brings us to the issue of how relevant component branding is to customer choice and preference. For a customer to make his purchase decision based on the branded component, the latter should be an important part of the final product as in the case of microprocessors or even car tyres.

This is when the seller can get away with charging price premiums, but at times the branded component is so important that the consumer is willing to consider other final products with the same branded components. This is a case of asymmetry in gains and losses when the component becomes more important than the product.

Another danger is that of building two brands of which the customer likes and prefers one brand but has negative feelings over the other. As a result, the equity could get eroded significantly. The question is, can a strong brand help to tide over the negative attitude, and may result in a change of attitude over the other.

Hence, the following questions are becoming very critical to decide the issue:

i. When does a consumer actually prefer branded components?

ii. What are the optimal pricing methods (including premium?)

iii. Post-alliance attitude towards both the brands?

Advantages of Co-Branding:

1. Convincingly Positioned – Product may be uniquely and convincingly positioned by virtue of the multiple brands involved.

2. Creating Points of Parity – Co-branding can create more compelling points of difference or points of parity, or both, for the brand than might have been otherwise feasible. As a result, co-branding can generate greater sales from the existing target market as well as open additional opportunities with new consumers and channels.

3. Reduce the Cost of Product Introduction – Co-branding can reduce the cost of product introduction because two well-known images are combined, accelerating potential adoption.

4. Means to Learn about Consumer – Co-branding also may be a valuable means to learn about consumers and how other companies approach them. In poorly differentiated categories especially, co-branding may be an important means of creating a distinctive product.

5. Other Advantages –

In this view marketing era, companies prefer their brands to collaborate with other brands to achieve the following benefits:

i. Line extensions succeed by capitalizing on a partner’s brand equity;

ii. Brand extension success rates are maximised in the new market when co-branded with the reputed brand that has established in that market;

iii. Usage extension may happen due to component co- branding;

iv. Image reinforcement may take place due to co- branding;

v. The corporations are sharing the cost of loyalty programs; hence, the promotional costs to the companies are coming down;

vi. Co-branding signals a trade marketing operation; and

vii. Capitalizing on the synergies among a number of brands is yet another advantage of co-branding.

Disadvantages of Co-Branding:

1. Risk and Lack of Control – The risks and lack of control that arise from becoming aligned with another brand in the minds of consumers.

2. High Consumer Expectations – Consumer expectations about the level of involvement and commitment with co-brands are likely to be high.

3. Possible Negative Impact on Brand – Unsatisfactory performance could have negative impacts for the brands involved. If the other brand is one that has entered into a number of co-branding arrangements, there also may be a risk of overexposure that would dilute the transfer of any association.

4. Lack of Focus – It may also result in distraction and a lack of focus on existing brands.

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Types of Branding – Umbrella Branding or Corporate Branding: Definition, Strategic Framework, Advantages, Disadvantages and Future

Branding strategies deal with creating unique, differentiated identities and position for the product or services in the competitive marketplace. Corporate branding further ads up to address additional issues related to stakeholders of the company to create a strong brand image. Thus, corporate branding strategies require a very high involvement from the senior management of the company.

Often, a brand is expanded over a variety of related or unrelated product categories. These are called brand extensions. If a common name is expanded over all these product categories, then such a name is called a corporate or an umbrella brand.

Umbrella branding was first started by Japanese Company like Mitsubishi, Yamaha, Sony, Panasonic, Toshiba, etc., and was gradually favoured by Korean Companies like Samsung, LG, and Hyundai. Samsung uses its names on all its products ranging from Samsung tablet, to Samsung mobile, laptops, refrigerators and LCD’s.

An overarching brand name extended across categories of products is called family or umbrella brand, it is in sharp contrast with individual brand in which portfolio of each product is given separate name. It need not be necessarily name of the company or corporation itself.

For example:

a. Canon markets cameras, photocopying machines and office equipments all under its own name.

b. Yamaha sells not only motorbikes, but also pianos and guitars.

c. Mitsubishi group is into banks, cars and domestic appliances with the same corporate brand name.

d. Palmolive is a brand name for household products (dishwashing liquids) and hygiene products (soaps, shampoos and also shaving cream for men). These are all Umbrella Brands.

By investing in a single brand name, companies try to achieve economies of scale in advertising and brand building. Thus, by this logic investing in a single brand name proves to be cost effective. Companies try to use the same brand name for different offerings that they have and get the brand leverage on all its products. Hence, umbrella branding works out to be an economical strategy.

Corporate Branding:

Initially companies went on with corporate branding as they did not have too many portfolio brands with them. However, as the population increased new markets came into existence, some companies branched out and established brands under different names whereas the others enchased on the Brand Equity they created and sold the brands under a single name.

The corporate Branding rest on the following three pillars:

i. Trust:

Some brands get famous depending upon the number of years they have been in the market; the consumers gradually create trust on these brands, provided they maintain consistency in the quality. Harvard University branched out from Harvard Law College to Harvard Business School on shear trust and reliability.

It was the first B-School in the world to launch case study learning in management practice as Harvard was already using cases in their Law College.

ii. Brand Recall:

Corporate Brands are easily remembered more than the individual brands in some sectors. Entertainment brands like Universal Studios, MGM, Columbia Tri star and Walt Disney Company use more of their names, and their emblems prominently appear before the start of the movies.

iii. Builds Goodwill:

Some of the corporate brands have served generations, transferring goodwill from the grandmother to the grand-daughter. The brands have become household names and enjoy the goodwill of not only the consumers but also all their stakeholders. Corporate brands encash on this factor and build a host of offerings to various segments.

For example, Barclay’s bank enjoys the goodwill as one of the earliest banks that was established in London or UK. Even today the rich and famous siblings of the family members do banking with Barclays.

Umbrella branding also called Corporate Branding is a brand communication strategy used by established organizations which have a future vision of unrelated diversification growth. And also for the brands which enjoy the legacy of their founders most of the luxury brands like Kelvin Klein, Prada, Tommy Hilfiger, and Lactose enjoy the goodwill of their founders and have successfully used the branding as the signature for multiple brands that they manufacture.

For example, CK started off with jeans and today is dealing in perfumes, leather wallets, watches, etc. Even Tommy Hilfiger has diversified into many lifestyle products under the same name. Corporate Branding is to leverage the assets both tangible and intangible that the brand has created over time and pass it on to the new product offerings from the company.

Definition of Umbrella Branding:

Umbrella branding is ‘the art and practice of selling several products under the same brand name of the company also called as Corporate Branding. The strategy is to reduce the cost and increase revenues and also to create multiple touch points so as to generate incremental value to all the stakeholders’. – Dr Y. RamKishen

Why umbrella brands are preferred?

There are a lot of scenarios where umbrella branding is preferred over individual branding.

Some of the situations are described below:

1. Umbrella branding is used to enter into a new market:

Umbrella branding is an excellent strategy for companies which want to foray into new markets. As the brand awareness, associations and the brand reputation already enjoy the goodwill of the target group the new products inherit these innate qualities from the brand pull when they get on the Umbrella Branding platform. For example, Tata Group making a foray into the Financial sector, i.e. Tata Capital.

2. Umbrella branding may even make sense in the current marketing environment characterized by information overload and brand proliferation:

The brand and the media scene have become cluttered to the extent that most consumers suffer from excessive bombardment of information. In such a situation, registering a brand in a consumer’s mind may be impossible. Brand building awareness is also difficult in such a case.

Therefore, in this case umbrella branding makes sense because the existing brand already enjoys awareness and image advantage over new brands. The product can get this association and awareness simply by putting umbrella on it.

Tata is an old brand. It has been primarily into the old economy business like steel, cement, trucks, etc. The brand association with time and age lose relevance in current times. When Tata launched Tata Indica, it signified Tata’s foray into a new field. When the new product shares the umbrella brand name, it automatically sends a feedback. The result, the umbrella acquires new associations. This results in a new, contemporary, up-to-date, modern image. In this way a brand rejuvenates itself.

Strategic Framework for Umbrella Branding:

Umbrella Branding is done to achieve certain objectives. We will study about the objectives the company is trying to achieve using umbrella branding strategy. The various objectives are – Top of the mind recall, increase brand equity, ease to identify and helps in cross selling.

1. Why use umbrella branding?

It gives the advantage of TOMA, (Top of the Mind Awareness). It helps in cost cutting by slashing the advertising budgets as the brand invests in only one brand. The brand becomes easy to identify when the customers see the brand repetitively. The umbrella branding also helps in cross selling as the brand develops trust in the consumers.

So they are willing to try other products from the brand basket. Samsung is a brand name with various lines of business and thus, it enjoys cross selling and equity of the brand is also high. It featured in the top 50 brands with high brand value and equity across the World.

2. When is umbrella branding used?

The company will decide when to implement the Umbrella Branding Strategy in its branding strategies. Sometimes, the organisations, implement them after a long number of years, after gaining popularity in the market.

Given below are a few strategies of the timing of the umbrella branding strategy:

a. The brand is in mature stage of the PLC (Product Life Cycle).

b. High Brand Recall.

c. High Customer Loyalty.

d. Referrals/Brand Advocacy.

3. Select the Best Fit Strategy:

The company will select the best fit that suits its strategy based on the environment, its people and sometimes, the market structure also. The company will plan a judicious mix of the strategy, so as to avoid confusion or wastage of its resources.

i. Endorsed Brand:

The endorsed brand is a hybrid of corporate brand and product brand strategy. Though the product brand is more significant in the communications; the corporate brand is still present to pass on the brand’s generic associations to the product brand. For example, Maggi in its advertisements signifies that it is from Nestle. This strategy turns out to be less expensive as the trust is maintained from the corporate brand.

ii. Select Brands:

The company will select which brands should be selected to go for the Umbrella Branding. Some of the criteria are- brand popularity, brand recall, market share of the brand, etc. Given below is the example of the famous brand of Amul, which was selected by the Co-operative GCMMF (Gujarat Milk Marketing Federation)

iii. Single Brand:

In this strategy, the company will select only one of its main brands to go for extensions, and this is called as the Single Brand Extension. For example, Biersdorf of Germany made an extension of only one of their brands-Nivea. There are many consumers think that Nivea itself is a company.

4. Check Feasibility:

After the decision for the type of brand is made, the company will check the feasibility of the Project.

There are broadly two methods for this, which are as follows:

a. Market Research

b. Brand Equity and Valuation

After, carefully studying both the parameters, the company will decide which one of these strategies would be included or sometimes, a mix of both.

5. Implement the Strategy:

The feasibility study is the base for implementing the strategy. It builds confidence among the team and finally the strategy is implemented in a phase manner in certain markets to check the customer’s response else it can also be launched nationwide in one go. The companies go for bang on style for communication for various, stakeholders internal (Employees) and External (Shareholders, Institutional Investors, etc.) to be aware of the changes that are taking place in the particular brand.

Advantages of Umbrella Branding:

1. Saving Cost on Advertising:

Umbrella branding helps to make advertising easy for companies. It helps as they only have to invest in a single name and build it into a brand. Consider the case of Asian Paints, it had many sub-brands, and there was a reduction of media weights when each entity was advertised separately.

Then, the company shifted to a brand-centric portfolio which involved a change of logo, product names, packaging and advertising. This led to a positive response from the industry and helped Asian Paints get economies of scale in advertising.

2. The New Brand can Instantly Connect with the Target Audience:

Any new launch of a brand from the Umbrella Branding context can instantly create a customer connect as the parent brand is already famous and it would help in transferring the goodwill to the new brands on the stable. For example, Virgin Mobile easily connected with people in European markets after Virgin Atlantic challenged British Airways dominance in the markets and this move generated a lot of goodwill among the loyal Virgin customers.

3. Loyal Customers Would Endorse the Other Brands from the Same Company:

If the Umbrella Brand can create successful brand loyalty with its users the users may endorse the other products of the same brand. For example, when Nivea wanted to enter men’s market it just had to launch Nivea men’s series which got the benefit of its already existing brand reputation and made its place in the market.

Also HSBC’s customers endorse the credit cards, Mutual funds, life insurance, commodities trading, etc., from the same brand as it is easy for them to manage with a single bank.

4. The Same Channels of Distribution can be Used:

One product can piggy back on the other’s distribution channel. The dealers/distributors and other trade partners will be ready to carry the other products of the brand if the previous experience is good. The Onida television dealers carried stocks when Onida entered into air conditioners.

Disadvantages of Umbrella Branding:

1. Setback in One Product Category may Influence Other Products:

Brands build trust in the customers, and they are assured of certain deliverables communicated by the brand. A wrong encounter can break trust and customer may not be ready to try any other product from the same brand name. For example, Amul launched Pizza which bombed in the market place, and it affected the whole brand and finally, the organization had to withdraw it from the market.

2. The Umbrella Brand Strategy may not Work across the Various Portfolios of Brands:

These brands are difficult to stretch vertically- For example, Maruti Suzuki’s attempt to go to the premium segment by launching Kizashi failed desperately. This is because Maruti made its mark in the lower price segment and the brand is perceived as a low cost economy brand. Kizashi which was priced around 18 lakhs on road, made it difficult for the customers to associate with the high price and it did not sell.

3. Erodes the Brand Image and Leads to Dilution:

Umbrella brand needs to be focused. It must stand for the same values across the category or range of products, and have the same emotional link because products are not insulated from one another. So if a product is included in umbrella which has different values than parent brand then there is a danger of diluting brand’s image.

Future of Umbrella Branding:

Umbrella Branding with the advent of organized retailing, has gained wide popularity. Retailers do not feel the need to develop many brands for various categories because it is the loyalty towards their store name which draws and retains the customers. Hence, it is the retail store name which will be the brand for various product categories and not individual names for each.

The customers prefer these brands over that of manufacturers due to the fact that they address their functional needs well. In near future the high cost of media and advertising, and greater ad clutter and media fragmentation will make it impossible to create newer brand names. Umbrella branding can lead to the path of success if the brands can differentiate what they represent to the customers.

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Types of Branding – Rural Branding: Meaning, Elements, Significance, Strategic Framework and Future

Meaning of Rural Branding:

Rural markets are no more the traditional and rigid systems of cultural values as portrayed in the past. Today’s villages boast of a strong network of digital communication with the largest number of mobile users and internet users and are accepting change like never before.

Armed with 720 million people, 6,38,667 villages; India boasts of one of the largest rural markets in the world. Increasing disposable incomes with the help of the government schemes like MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) and JRY (Jawaharlal Rural Yojana) and agricultural income not being taxed, the rural incomes are showing a significant rise in the last decade. Added to this, the media explosion and changing lifestyles is paving way for the rural consumers to splash on the brands.

The increased brand awareness and multiple brands to choose from is changing the dynamics of this market place and thereby forcing the corporate to take rural markets seriously as opposed to their previous strategy of dumping failed urban products in the rural markets.

Smart companies are shaping their rural marketing strategies by customizing exclusive products for these markets like LG’s Sampoorna, Philips Solar lantern, Tata Swach water purifier, etc., by embarking on the reverse engineering and disruptive technologies to target this market.

Rural Branding poses significant challenges when compared to urban branding as most of the rural consumers are still illiterate, the focus of the brand communication is on the visual impact and less on the message execution.

Rural branding is mostly handled by advertising agencies which specialize in rural communication like O&M’s outreach; Lowe’s linter land , McCann Erickson rural, Sampark, Starcom’s Expanse, etc., or rural marketing consultancies like Mart, Madison or Rural marketing research agencies like IMRB, etc.

The major focus in rural branding communication strategies would be on the budget of 70% on visual communication and 30% on message communication strategies.

Elements of Rural Branding:

The following are important tools in the rural branding communication:

1. Visual Communication:

i. Emblems:

They are the corporate identity for a brand. Strong Emblems are an easy recognition for any brand launch from that particular company, for example, Tata group is now launching Nano in rural markets and focusing more on the Tata emblem, as the Tata emblem is already famous for their other products like trucks, salt, water purifiers and galvanized steel sheets. Some more examples of Emblems would be the LIC, SBI which have strong presence in rural markets.

ii. Logos:

Logos are symbolic identities for a particular brand of the company. Thumps Up has a strong Logo, although the brand is from Coca Cola Company. The rural consumers ask for Thumps Up by folding their palms just like Thumps up Logo and Sarpanch’s face on Mahindra’s tractor.

iii. Mnemonics:

They are symbols which do not have any relevance for the brand. They play a significant role in the sale of some products in the rural markets. The added advantage for the marketer is that it creates an excellent brand recall in the mind of the consumer. Ever ready batteries score more on Visual impact than Novino batteries from Panasonic by enhancing the Cat symbol in their promotional activities. It was known as ‘The billiwala cell’.

iv. Packaging Design:

Packaging the ‘Silent Salesman’ in marketing plays a significant role in the product placement at the retail both in Modern trade and Mom and pop stores (kirana shops). Parle wanted to launch Frooti in rural areas but, instead of following the traditional packaging design the company opted for triangle shaped tetra pack and offered two packs for Rs. 5.

Sometimes packaging designs can enhance the product usage and also repeat sales as witnessed in the sachet of shampoo. Chick shampoo pioneered by launching a smaller SKU (Stock Keeping Unit) for 50 paisa only.

v. Brand Characters:

Brand characters are add on visual symbols to create more impact for a brand in rural markets brands like Asian Paints, Amul butter, tiger biscuits from Britannia are using characters to build signi­ficant brand identity for their brands.

vi. Colours:

Another important medium for Visual Enhancement is a usage of colours in brand communication. Rural consumers by nature like more bright colours than sober colours. Brands like lifebuoy, Asian paints Utsav, tractors in red colour and consumer durables in Black colour.

2. Message Communication:

It is usually coupled with Visual Communication provides a broader picture and more clarity about the product to the consumer.

The following are few components of message communication:

a. Punchline:

They provide an excellent top of the mind awareness. A single line communication can build a huge market for a particular brand. It is astonishing to see that rural consumers prefer punch lines more in English than vernacular languages. For example, Raymond, ‘The complete man’; The Loot, ‘The Great Steals on big brands’, Tata Nano, ‘Khushion ki Chaabi’.

b. Body Copy:

It provides additional information about a brand and is sometimes useful in pushing the brand in the market. Mahindra launched max as a taxi and provided lot of information about space and mileage as their target group were the taxi drivers. M&M also highlighted a lot of information about Scorpio in their body copy on the 4 by 4 all-terrain drives.

c. Headline:

Head lines are synonymous with the brand’s positioning. They are mostly used at the time of the launch of the brand, to attack competition or shield from competition and also for brand recall. These days mostly brands are using headlines along with the social message to build brands in the rural markets. ‘What an idea Sir ji’ from Idea cellular is a classic example.

Definition:

Rural Branding ‘is the art and science of communicating a brand in the rural markets through the effective use of visual and message communication in order to position the brands and increase their recall in the minds of the consumer so as to create value for both the consumer and the company’. – Dr Y. RamKishen

Significance of Rural Branding:

1. Rural branding is based more on volume:

The rural markets is all about volume, the major chunk of the rural consumer values the quantity more than value, for example, if we look at some of the brands like Parle-G and Nirma, they sold huge volumes on the basis of quantity of their packs more than the value they delivered.

2. More purchasing power means more incremental returns:

With the purchasing power of the rural consumer increasing, it means that now they can spend on consumer durables and other products that were earlier thought of as luxury but now are seen as a commodity. Thus, big players like Sony, LG, and Samsung all base their strategies on rural markets. As they know the affordability for these products is there so consumer durable brands are making their products available in these markets.

3. Rural consumers are getting brand conscious:

As branding has done its part, the rural consumers are more brand conscious than ever. It makes it even more easy to associate with these brands as more and more celebrities are coming from rural background, there is a strong connect that the rural consumer feels when they see these celebs coming from rural areas; endorsing some brands, for example, if we take the example of Mahindra Singh Dhoni, he is promoting many brand.

Now when he advertises for fashion bazaar there is immediately an image that is build up in the mind of the rural consumer and as they try to emulate him and thus, connect with the brand in a much better way. Also, with the onslaught of realty shows, any normal person can be a star by getting on these shows. Rural branding is taking a new form like when we talk about Lux, it changed its tagline only to rope in more customers.

4. Rural markets are huge untapped markets:

More sales growth is visible in the rural areas. Nokia has been betting big time on the rural markets, it launched Nokia 1100 for the rural consumer to penetrate the market and now it has also launched some high range sets in the rural markets only after the success off its first 1100 handset.

Idea, Aircel, Airtel, are telecom majors are targeting the rural consumer in its communication. This signifies that even the telecom majors have understood that they need to increase their consumer base. The rural markets will be the real drivers for the growth in future for any company that wants to succeeds in the country.

5. Brands have to talk in the language of rural people:

Asian paints launched Utsav, a word that means festival in almost all parts of the country and it was especially for the rural consumer to upgrade them from using choona and giving them a value proposition that they understand. Onida launched its television igo; the television set sold and became successful as they had understood the way to talk to the rural consumer. For the rural consumer more non-conventional media like puppetry shows, soap theatre, video on wheels, etc., are used to succeed in these markets.

Strategic Framework for Rural Branding:

The rural markets are different from their urban counterparts thus; a different approach to the market is required to convert into sales.

Given below is a strategic framework for rural markets:

1. Brand Vision:

It is a company’s perspective for what the brand stands for and how do they want the brand to be perceived. Brand vision is something that the company lives day in and day out. A brand vision is an aspirational statement of brand or corporate intent. The vision reflects what the brand aspires to be and guides the brands path towards the future. The brand vision is what makes employees in the company deliver, even when the founder of the company is no longer with them.

The brand vision determines what the product would be; the product passes through three stages:

i. The seedling stage

ii. The sapling stage

iii. The harvest stage

i. The Seedling Stage:

This is the stage where the product is like a new born child. Here the product is in its infancy stage, thus, there are a lot of uncertainties and a certain amount of vulnerability is there, in terms of low sales, lack of demand and low profits. This stage corresponds to the introduction stage in the product life cycle.

The customers have to be induced to try the product, thus, advertising expenses are very high in this phase. Advertising in this part is informative in nature and the main goal here is to induce trail purchase. The length of this phase depends upon consumer acceptance and other variables. For example, Tata Engineering has launched an extended version of the Sumo for rural markets with the brand name Spacio.

This stage works to create Brand Awareness and Brand Familiarity, this refers to the proportion of consumers who know about a brand and recognize the brand’s existence and are able to associate it with the correct product or service. Creating brand awareness is one of the key steps in promoting a product.

As the consumers start recognizing a brand the trial purchase is more likely to happen which in turn generates sales for a company.

ii. The Sapling Stage:

This is the stage where the product has gained substantial visibility and its sales are shooting up. Eventually, with the emergence of new competitors, even the markets grow. This corresponds to the growth stage in the PLC. Here pricing and availability of the product is very crucial for success.

Pricing is more competition oriented and companies cannot dictate terms to the customer. For example, Samsung in the wake of growing competition from the likes of LG, BPL and Videocon has allocated separate budgets for each brand especially in the rural markets.

The company has planned specially designed CTV’s for the rural markets in the 14-inch and 20-inch categories, semi-automatic washing machines and direct cool refrigerator range. This is the stage where the advertising is persuasive as now the customer is already aware of the product and the challenge is to make the product a preferred choice of the consumer.

The advertising here is persuasive and it intends to create a brand identity and brand image. The brand identity is the promise that the brand makes to the consumer through the communication it displays. It may consist of attributes, features, performance, benefits, quality, service support and the values that the brand possesses.

The other aim is at creating brand image; this has more to do with the consumer’s perception of the brand. It is usually evoked by asking consumers the first words/images that come to the mind when a certain brand is mentioned. It consists of the imagery the brand builds in the minds of the consumer and many times reflects the person’s self-image or the aspirations of the person which as a whole induces the person to the brand.

If the brand identity and the brand image are consistent and positive in the consumer’s mind it will result in brand preference. As the brand preference is created customers will look for the brand and make a conscious choice to select the brand over other competing brands.

iii. The Harvest Stage:

This is the stage that corresponds to the mature stage in the PLC. This stage signifies a saturation point in terms of demand with heightened supply from several competing sources. The sales volumes have not declined here but the profits start declining due to the increase of expenditure to fight competition.

For example, ITC, which is an exports agricultural commodity is in its maturity stage, discovered a way to bypass the age- old mandi system and buy directly from farmers. It also offers the prices that ITC hopes to buy it. The aim of the advertising is reinforcing the brand in the consumer’s mind.

The brand personality is the set of human characteristics that can be associated with a brand. It allows for customer self- expression, provides point of differentiation and represents attributes but, transforms into relationship relevant constructs. The last stage is of brand relationship, for example, Google has formed a relation with its customers with the help of Orkut.

Meaning of Counterfeits:

As the brands grow, so do the imitators and copiers. A major chunk of the revenue loss occurs due to the spurious brands that have flooded the market place. A report by A.C. Neilson showed that in the Indian markets the FMCG segment alone incurs a loss of Rs. 1,800 crore because of counterfeits in the markets. So, either you will see a ‘like’ instead of Nike and ‘Luma’ instead of Puma.

Though this is just one form of the disease; it eats up in the profits and brand image that brand managers strive so hard to create. For ‘The Economist’ these products are forged, copied or imitated without the knowledge of the original manufacturer and without having the right to perpetrate with the purpose of deceiving.

There are many examples of products that have been plagued by these spurious brands the list includes over-the counter drugs, clothing, credit cards, watches, pace makers, and machine and automobile replacement parts. Thus, we will now discuss the strategies to counter these spurious brands.

Strategic Framework to Counter Counterfeits:

The companies will first try to identify what kind of counterfeits they are facing an issue with. In this framework there are various possible ways that can be practiced to eliminate and reduce the effect of spurious brands.

1. Research to Find out Counterfeits or Spurious Brands:

There should be a proper research done in the market till the retailer level to find out infiltrations of such kind of brands flooded in the market. This research should be carried out in rural areas as the chances of duplicates increase there and the chances of them being caught are also less due to lack of awareness in the villagers.

An ORG-MARG retail audit found that for every 100 strips of genuine Action 500, there were 54 lookalikes. P&G got 55 Injunctions against as many manufacturers. Vicks Vaporub and inhaler had about 20 clones. In fact, after one massive raid in Madhya Pradesh for spurious Vicks products, the company used the services of an elephant to destroy the counterfeit catch.

2. Identification of Counterfeits or Spurious Brands:

Identification of spurious brands can be done as they mostly are found in three forms:

a. Lookalike

b. Spell Alike

c. Duplicates

Studies show that the government loses around Rs. 600 crores on account of unauthorized manufactures.

a. Lookalike:

The price of a lookalike is 10-15% lower than that of the established brand. They may be of acceptable quality. They lookalike sports colour schemes that resemble that of popular brands, but the names are totally different. It becomes easier to disguise the rural customer as they mostly have colour or a picture description with them of a brand.

For example, they will recognize lifebuoy as Lal wala sabun. Thus for a look alike a red colour will lead the customer to buy it thinking that it is Lifebuoy. A major reason for these lookalike intrusions succeeding is that around 59% of the rural population is literate as compared to 80.3% in urban area. Lookalike offer higher margins to the retailers as compared to the established brands.

b. Spell Alike:

These are more dubious than the look alike. The packaging is similar to that of an established brand, thus the name on the pack would be a ‘Viggo’ instead of ‘Vicco’ or a ‘Pomes’ instead of ‘Ponds’. The intention of the spell alike brands is to fool the customer by having the same MRP printed on the packaging.

However, the shopkeepers would reduce the prices if the customers bargain. Most of the spell alikes have a vague manufacturer’s address on the packaging which is impossible to locate.

c. Duplicates:

The next type of brands is called Duplicates. These products carry the genuine name and address of the company. However, the product inside is spurious. Sometimes, the used packs are re-filled with spurious products and are sold as the real things. These are very difficult to be identified as duplicates. Mostly, the soft drinks in India face the problems of duplicates. As the rural customer is illiterate, the chances of him getting duped are high.

3. Develop the Strategy to Counter Spurious Brands:

There are various strategies to counterfeit the spurious brands:

i. Setting Up the Company’s Task Force:

Company can set up an alert task force to curb the menace of duplicate manufacturers, offer incentives to informers. For example, Coca Cola has been conducting raids against such manufacturers. Recently Marico also set up a task force to combat the duplicates for their flagship brand Parachute.

ii. Redesigning Packaging:

Packaging has to constantly upgrade itself in order to avoid counterfeit which replicate the original product. Some brands keep on changing the shape and colour. For example, Bisleri has around 30 duplicates in the market and now has changed from blue to green and re-named it as mountain water.

iii. Enhancing Rural Distribution:

One of the most important tasks of the marketing department is reach of the product to the market. Sometimes enhancing distribution and increasing the presence in rural markets can ward off competition mostly in the spurious brands, as all the duplicates cannot have pan India presence.

In this way the distribution as well as the reach will help tackling the spurious brands. For example, Parle-G changed their packaging from wax paper to plastic and also enhanced more touch points to increase their presence in rural markets.

iv. Giving Better Margins:

As a known fact the margins given by the established brands to the retailers are very low as compared to what they get by selling counterfeits. In some cases the margins can be as high as 300%, which is a huge amount. Thus, if companies give more margins to their retailers they will be more willing to keep only the established brands.

4. Curtailing Counterfeits to Enhance Value and Improve Sales:

The companies can make the retailers aware of the perils these spurious brands can cause, apart from the economic loses that they bring to the company’s front and also on the nation due to tax evasion. They can cause physical damage and harm the person using such products.

It was found that some of spurious manufacturer’s pick up used cotton of the hospitals that is dirty, blood and pus filled and then they clean that and beach that cotton and sell ear buds. It is found that if a person uses such ear buds he can go deaf or get a viral infection called Herpes Zoster Octicus, so, such products should be avoided.

It has also been found that the counterfeits come in the smallest size packaging. Thus, countering spurious brands will benefit not just the brand, its consumers and the entire nation.

Future of Rural Branding:

Rural consumers are copying their urban cousins and getting more aspirational there by resulting in increased brand awareness, upgrading to lifestyle products, trying out a new and innovative products.

With direct to home penetration and increased usage of mobiles, rural consumers are getting the latest updates and accordingly adopting the practices in their lives. Brands in rural areas are gaining dominance and are generating more revenues in giving better returns to the corporate. Some brands are also entering in to the digital space in their brand building, for example, rural naukri.com.

Wipro started its first rural call centre, ITC’s E-Choupal, Haryali stores, Adar, Kissan Kendras from Tata Group, Tata Gold Plus, all such examples show that there is a lot of scope for brands to grow and develop products tailored for the rural consumer. Thus, more and more innovation helping rural people will be successful.

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Types of Branding – Green Brands: Strategic Framework, Advantages and Disadvantages

Green brands are ‘brands which are environmental friendly brands where the entire set up of manufacturing, logistics, marketing and other activities will all be designed to minimize the environmental damage’. – Ms Nalini Dutta

Strategic Framework for Green Brands:

The brands can go green by various ways either they can ‘Recycle’, ‘Reuse’ or ‘Renew’. In the wake of increasing competition companies are forced to adopt the green philosophy. Brands can launch a green product that is environment friendly. They can go for Green pricing which means that companies may promote electronic transactions with the consumers.

They may also go for Green place like Wal-Mart adopted the idea to make its entire supply chain green. Other companies adopt the G-SCM, i.e. Green supply chain management. The fourth ‘P’ of Promotion can also be implemented by doing online promotional activities using digital brands. Companies go for Green Branding for a lot many reasons.

First reason is to make it act as a Differentiator; this is done to create a niche for the company like Tata’s have launched green batteries, Citizen has launched eco-drive watch which are without any cell. Second reason can be for Goodwill generation. It helps in building reputation for the firm. Nokia’s recycle effort is for earning goodwill for the company, IBM’s ‘save the planet’ initiative was for this reason only.

Then there is Emotional selling. This is to create consumer connect; this happens only if the consumer is already sold to the idea of green brands. Handmade papers are successful only because of the awareness in the consumer. Micromax launched a battery which can last for 31 days thus, again an effort to go green.

And the last reason is to Block Competition which leads to a better market share. As more and more consumers become conscious of green brands they will sell more so being the first player in this segment will give a first mover’s advantage. If it is implemented successfully it will add to the incremental value of the brand. Thus, will lead to brand equity and will increase the return on investment of the brands.

Advantages of Green Brands:

1. Tackle Competition:

Brands are going for green products as the consumer is becoming more and more environment conscious. Thus, the consumer prefers brands which are more responsible towards environmental damage. All the big companies are vying for the consumer priority and wallet. Toyota Prius, Honda Civic, Honda Accord, etc., are all the cars in this segment.

2. Goodwill:

Companies take green initiatives to increase their goodwill in the eyes of the consumer. For example, Nokia takes the initiative of calling the customers to return their cell phones which are old and destroyed and not in use; and it takes the responsibility of recycling these cell phones so that they can prevent the environmental loss that happens. Thus, it creates a positive brand image in the minds of the consumer and they see the brand as socially responsible.

3. Satisfy the NGO Pressures:

Many NGOs are actively working for environment like Green Peace organization. These NGOs put a lot of pressure on the companies to comply with the environment regulations. As they actively file writs and petitions against the companies that are causing harm to the environment.

4. Builds Customer Loyalty:

Customer rewards the brand for being responsible socially and environmentally. Philips is a brand that has continuously upgraded itself and its products to meet the changing needs of the consumer. It launched the CFL tubes, that consume less electricity and now it has launched a television with leds. Thus, it enjoys customer loyalty.

5. Customer Benefits:

Green products are environmentally good and are a value for money for the customers as well. Like the Reva car is a value for money product for the customers.

Disadvantages of Green Brands:

1. Green Washing:

Some corporate mislead the public by claiming that their brands are green but, in reality it’s the other way round. A normal product is shown as a green product/brand and is hammered into the head of the consumers. This is called as green washing.

2. Expensive Proposition:

Green brands are usually a very expensive proposition. It is because the technology is new and expensive so the products also become costly. Simply a CFL tube costs almost thrice as a normal tube. Toyota Prius costs Rs. 30 lakh.

3. Lack of Consumer Awareness:

Green brands are a new concept and thus, very few customers are aware of it. The economically strong customers are the only ones that are aware of this concept. Education at the lower income groups is still not there which means majority of the population is not aware of what are green brands what are the products who do less damage to the environment. So even if green brands are given to them it might fail their logic to spend more on such a brand rather than a normal brand which will be cheaper.

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Types of Branding – Digital Brands: Definition, Types, Advantages, Disadvantages and Future

The advent of 21st century is shaping the market dynamics in the whole world. Internet connectivity, mobile penetration and social networking sites are paving a way into the digital communication era and forcing the countries into a global village.

Information communication technology (ICT) will be the proven tool to run the government (e- governance), community marketing (facebook, twitter, etc.) ecosystem marketing, sharing of marketing needs through collaborative efforts using internet) E-Commerce had redefined the B2B marketing and the vendor management has converted to global procurement practices.

It is astonishing to note that the R&D for I-pod is done in South Korea, manufacturing in China and the consumer is in India. M-Commerce (mobile – commerce) will be a highly integrated tool.

As India boasts of 600 million mobile users which is hungry to grow in the one billion populations’ banking transactions, booking tickets sharing of information, weather reports in rural markets will all be under the purview of the mobiles. Brands are also about experiences rather than merely products.

V-Commerce (virtual commerce) will generate experiences on the computer by using advanced graphics on multimedia. Without visiting a mall/retail store, a shopper would have hands on retail experience by browsing a virtual store in 3-D imaging; this would not only save the cost but, also generate virtual retail experience for the shopper.

Digital brands will shape the future of marketing. They can be websites, portals knowledge kiosks, web marketing, search engines networking sites, etc. These brands use minimal mainstream advertising and solely depend on number of hits on their website and build by WOMM (word of mouth marketing) for instance, Orkut sends an invite then the person receives an email on his/her Google/yahoo or any other mail account. Thus a new interface has been created between him and the digital world.

The social networking sites will be increasing their usage in the business circle very fast in the years to come. It might so happen that updating your status on Facebook or twitter will not only be allowed in office hours but, will also be expected, i.e. to say it might become a business protocol.

Thus much of inter-office communication might happen through these sites and not through e-mails in the future. Some of the companies like TCS are already using some social networking system that augments e-mails. Another company Mind-Tree also uses a social networking site for inter­office communication.

Definition:

Digital Branding is ‘a process where the brands make their presence felt using digital platforms like websites, networking sites, portals, search engines, it would also include brands which leverage internet, so as to generate a meaningful picture and brand experience in the minds of the consumer’. – Dr Y. RamKishen

From the above mentioned definition it can thus be inferred that:

1. Digital brands are also called online brands.

2. Digital brands are available in different options.

3. A physical brand can also leverage internet for creating top of the mind awareness (TOMA).

Types of Digital Brands:

1. Online Communication:

The following are the 3 types of online communication:

i. Email and Chat:

Gmail, Yahoo, Rediff all these sites offer e-mail service to its registered users absolutely free. We can also use the Yahoo messenger or Gtalk to Chat. Gmail had 146 million users as of July 2009 (Wikipedia).

ii. Blogs and Forums:

There are various websites where you can create your own blog. We have various products which have their blog like I-pod has its own blog. Cadbury’s chocolate Bournville has a blog where various stories are uploaded constantly to hold the audience of the blog and get their reviews and comments instantly.

There are various forums like pagalguy where MBA aspirants can type and have their queries answered. The information they receive is not just about colleges but also about a lot of other things. About important dates, students also post their interviews for others to read and benefit from it.

iii. Social Networking Sites:

Orkut, Facebook, Twitter, there will be very few among us who will not be registered on one or more of these or some other social networking sites. Social networking sites are the next biggest way for a company to activate a brand or advertise with a certainly of being noticed.

2. Classifieds:

We have job portals like Naukri, Indeed, Monster, and Fundoojobs, etc. These classifieds get the registered user, notified of the available opportunities.

3. Games and Entertainment:

We have various entertainment sites and online gaming sites. If we take the example of Zapak. It is an online gaming site and thus, a completely digital brand with the product offered and consumed online in most of the cases. Then there are various entertainment sites like Ibibo, You Tube, etc.

4. News and Information:

Websites are also a mean of unlimited information and news. Huge amount of information is available on the internet. These days, people watch live budget and live cricket matches on the internet.

5. Online Services:

There are various service providers on the internet like online railway booking, web portals like make My Trip.com, and Yatra.com etc. are running successfully today.

6. Online Shopping:

Today we can buy birthday cards, cakes, laptops, books and many more things on the internet. Amazon(dot)com became very successful as web portal selling books. Though it has no outlets, but still you can search any book on their website and buy it from there.

Advantages of Digital Brands:

1. Content:

There is a huge amount of content that can be available on the internet. For many of us searching for any sort of information the only source trusted and sought at the first instance is Google. The availability of information on the net is huge. Sites like Wikipedia, Google search, etc., are the top names where the information is searched.

2. Convenience:

Without moving out in the scorching heat of the summer we can order from pizzas to books online. Amazon has started Amazon kindle. We can check out for availability for railway tickets, book your tickets, cancel your journey, etc. There are various portals that do this work like make my trip, etc.

3. Custom Made Information:

Companies have started blogs for their brands. On the internet we can also have information specific like Harley Davidson. We can look for information about specific cars and have 3D view of the same. There is information just about the way you want it and in the quantity you command.

4. Clarity:

Digital brands provide more clarity in terms of content, product knowledge availability, etc., for example, if a customer wants to buy a HP printer he can visit the website of HP, find out the features of the product and also know about the price and the availability of the product.

In this way the customer has a sense of clarity on the product or brand, he is willing to purchase. Search engines like Google and Bing, Web portals like SIAM provide precise information to the end user of the product thereby enhancing his clarity in the decision making process. Internet is a self-mentor and can guide you as best as one can. The sites are connected to one another. Search engines, trade portals like society of Indian automobile manufacturer’s (SIAM) are connected to other websites.

5. Comparison:

The portal compares not just prices but also feature of a product. This gives the customer a feel that he is shopping intelligently and thus, he makes a sound choice. Also he can check for the reviews of other users before ordering for the same.

6. Compatible:

Digital brands are eco-friendly. The future lies in an office where all the systems are related with each other through internet and intranet, as Bill Gates describes a paperless office in his book Business@the Speed of Thought.

Disadvantages of Digital Brands:

1. No Feel and Touch of the Product:

Indian consumer also wants to buy experience with the product. Thus many products can never be successful in India if physical distribution and retail outlets are not developed in the country. For example, Dell which is selling computers online had to create a retail presence to succeed in India. Now they have stores in other parts of the world.

2. Life of Digital Brands is Very Less:

The product life cycle of the digital brands is very less as compared to life cycle of physical product. Whenever there is a new technology in the market it is adopted very fast by the competitors. Even a new idea of a service grows very fast. For, example, if we take the example of Naukri(dot)com, it started and soon the competition followed with monsterjob(dot)com, fundoodatajobs(dot)com, indeed(dot)com, etc.

3. Not Reliable:

Hacking has always been a problem for doing business transactions on the internet. The reputed banks like SBI and ICICI have their phishing sites, which take your information and give it to the hacker and thus, he is able to transfer funds from your account. Cases of net thefts have been reported frequently, though companies are coming up with solutions for these problems like virtual keyboards on their sites but, it will still take a long time till it can feed confidence into the minds of the Indian consumer.

Future of Digital Brands:

Brands will take the convergence platform where they interface between internet, mobiles and television and will provide a host of information about the brands, and will make life simpler, entertaining, and a rich source of information.

Digital brands will shape the way the world will progress by providing real time data of weather forecast, navigation maps like Nokia is giving free navigation maps service launched by the name OVI maps to its handset users. GPRS and RFID are helping in the tracking of logistics movement. Brands would provide a 360 interface to the consumer and would talk to them in the way they want to be communicated. The future seems to be bright for digital branding.

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Types of Branding – Luxury Brands: Introduction, Dimensions, Model, Challenges and Opportunities

Introduction to Luxury Brands:

LUXURY is no stranger to India. The maharajas and princes have led a life of opulence. But, the only way to be associated with it was to be lucky enough to have it in one’s heritage. Luxury then was associated with hunting, polo, and other activities of the rich. It was an unwritten rule that the “Aspirants” cannot climb up to the “Globals” segment.

The Princes operated in a different league altogether. The era of the self-made millionaire was yet to arrive. An achiever of the 1970s could only get away with a good foam mattress — no Omega, Rolex or BMWs!

It was in the 1980s that luxury brands saw themselves into upper class homes through small things and symbols, and also through “aunties and uncles” having brought a gift from their first trip abroad. The concept of luxury as a reward for achievement gained acceptance, though royalty and the aristocracy continued to remain the benchmark of the elite.

The real change came in the 1990s when more people started making good money. What contributed to this shift? India opened up to the world. The liberalization process brought more than high economic growth rates. It showed the people what was possible. In the process, it has altered mindsets.

The IT revolution, and the consequent demand for Indian brainpower, has created a whole new breed of wealthy global Indians. At the other end, an increasingly open economy has created new business opportunities, which has resulted in a slew of new, extremely successful first generation businessmen.

In marketing parlance, luxury is nothing but “the art of pampering a consumer’s senses and ego overtly”. The latter part becomes very important in developing countries like India, where the new rich want to announce their arrival and the old rich want to separate themselves from the new.

Luxury brands are the ones whose ratio of functional utility to price is low while that of intangible utility, to price is high. Luxury brands have often been associated with the core competencies of creativity, exclusivity, craftsmanship, precision, high quality, innovation, and premium pricing.

These product attributes give the consumers the satisfaction of not only owning expensive items but also the extra-added psychological benefits like esteem, prestige, and a sense of a high status that reminds them of the fact that they belong to an exclusive group of only a select few.

Dimensions of Luxury Brands:

There are five key luxury dimensions that must be established or monitored for creating a lasting luxury brand. It is expected that different sets of consumers would have different perceptions of the level of luxury for the same brands, and that the overall luxury level of a brand would integrate these perceptions from different perspectives.

i. Perceived Conspicuousness:

The consumption of luxury brands may be important to individuals in search of social representation and position. This means that social status associated with a brand is an important factor in conspicuous consumption.

Furthermore, consumers who perceive price as a proxy for quality often perceive high price as an indicator of luxury. Hence, the measure of conspicuousness includes items such as ‘extremely expensive’, or for wealthy that tap into perceptions of price and social status associated with the brand.

ii. Perceived Uniqueness:

Scarcity or limited supply of products enhances consumers’ preferences for a brand. Uniqueness is sought to enhance one’s self-image and social image by adhering to one’s personal taste, or breaking the rules or avoiding similar consumption. The uniqueness dimension is based on the assumptions that perceptions of exclusivity and rarity enhance the desire for a brand, and that this desirability is increased when the brand is also perceived as expensive.

iii. Perceived Extended Self:

Consumers may use luxury brands to classify or distinguish themselves in relation to relevant others, but they may also try to integrate the symbolic meaning into their own identity. Social referencing and the construction of one’s self appears to be determinant in luxury consumption. The possession of luxury brands may be more appreciated by consumers who are highly materialistic and susceptible to interpersonal influence.

iv. Perceived Hedonism:

Luxury seekers are considered hedonistic consumers when they are looking for personal rewards and fulfillment acquired through the purchase and consumption of products, which are evaluated for their subjective emotional benefits and intrinsically pleasing properties, rather than functional benefits.

v. Perceived Quality:

It is expected that luxury brands offer superior product qualities and performance compared with non – luxury brands. Consumers influenced by the quality dimension of luxury may perceive that luxury brands have superior characteristics compared with the non-luxury brands. These characteristics may include but are not restricted to- technology, engineering, design, sophistication, and craftsmanship.

It was further identified that there are certain factors, which support or reduce the luxury dimension. E.g. – Mercedes-Benz and Porsche had very similar scores for quality and uniqueness, but conspicuousness was much higher for Mercedes, which contributed to make the Mercedes a brand more luxurious than Porsche.

From a market positioning point of view, if a manager of a luxury brand witnessed declining brand luxury, the specific weakening dimension could be identified. Thus, taking remedial actions such as changing the advertising message, stressing the luxury attributes, or emphasizing the benefits of the brand over competing brands could be undertaken.

For example – if the luxury image of a car maker was slowly decreasing due to an increasing number of dealers (i.e., weakening uniqueness), then appeals emphasizing the limited numbers of cars available or informing the consumer about the precious components used in making the car, would be appropriate to reinforce the overall luxury image.

Model for Building Luxury Brands:

The model represents a framework of the various stages that a “Product” passes through to be finally called as a “Luxury Brand”.

A commodity with little differentiation is termed as a product and when the product is credited with various dimensions such as image, quality, uniqueness and conspicuousness, it gets converted into a brand.

A brand which aspires to be classified as luxury brand has to undertake strategic below- the-line and above-the-line marketing activities. Seventy per cent of marketing activities for luxury brands include below the line activities such as word of mouth, special events organized for esteemed customers covering prominent social events and socialites, and also some amount of undercover marketing.

With the inclusion of strategic marketing activities, a brand finally falls into the “luxury brand” category.

Challenges for Luxury Brands:

i. The Ideal Location – Not Yet Arrived:

Though, the luxury brands are keen and have every reason to enter India, the main question faced is “where should they be located?” Brands such as Jimmy Choo, Chanel and Christian Dior have found their place in 5 star luxury hotels like The Taj Mahal Hotel in Mumbai and The Trident Hotel, Mumbai.

However, hotels are hardly the ideal space to shop for luxury brands, as they lack the space, variety and atmosphere that a luxury shopping experience warrants. The concept of luxury high streets and luxury malls is yet to catch on in India.

ii. We are at Lesser Price, in More Variety Abroad:

One of the major roadblocks for these brands is that they are available at a lesser price and also in greater variety abroad. The prices are much less abroad as in India, they carry import duty, currently at 35% and in the case of luxury watches, and it is as high as 50%. Italian fashion house Ermenegildo Zegna says India’s luxury market is at least 10-15 years behind China’s, and primarily due to a higher duty structure.

Joseph Wan, Group Chief Executive for Harvey Nichols, the London-based retailer, says India’s recent economic growth and indications that New Delhi is prepared to liberalize its markets are encouraging, but adds that prime real estate in Indian cities is too expensive and that tariffs are prohibitively steep. “Harvey Nichols caters to the top 3% of the population, and that 3% are very well-traveled,” says Wan.

“If my Dolce & Gabbana in India has to be more expensive because of import duties, how can I do any business? You just can’t”. Also India’s existing FDI policy, which limits the foreign ownership in ventures, has discouraged a number of luxury brands from establishing a significant presence in the country.

iii. The Long Wait:

Another challenge for a brand in this category is to sustain its exclusivity and pricing in the long run. And that is the reason why we do not have our own genuine high end brand. Often, brands start at a premium, but quickly trickle down to cater the general public. The temptation to give in to lower prices is way too high. Patience and commitment are the two essential factors for a brand to create its own niche market.

iv. The Indian Market is “Different”:

Although, the craze for luxury brands is catching up in India & China, the luxury market in India is driven by a different set of rules.

Players in this field are now feeling the need to modify and customize their products before catering to the Indian elites. For instance, both Audi and Sweden based Volvo have made their cars tougher and more suitable for the Indian roads. “Veze” from Versace has plans to roll out something exclusive for the Indian market. Also, Louis Vuitton has not launched its ready to wear yet in India, as the CEO, Yves Carcelle feels that Indian women still prefer wearing saris to parties.

v. Counterfeit Goods:

One of the major threats that luxury brands face now is that of counterfeiting practices. According to the International Anti-Counterfeiting Coalition (IACC), the global counterfeit traffic now stands as a nerve-wrecking $600 billion industry, representing 7-9% of all global trade and the Indian market with a vast consumer base, high aspirational levels and price sensitivity hold the key.

Recently, the Mumbai police recovered duplicate accessories worth Rs. 1.5 crores of brands ranging from Mont Blanc, Cartier and Chanel to Piaget and Rolex. Market watchers confirm that highly popular and advertised brands are the most likely victims of counterfeiting because of their demand and the aspirational tag attached to them. The bigger the brand the more the chances of its being picked up by counterfeiters to copy, fake, and sell.

Counterfeits are available at a very low price and connect the consumers remotely to the original brand. E.g. – Counterfeits of GUCCI, Mont Blanc, POLICE, etc. are available as cheap as Rs. 200 at Fashion Street in Mumbai.

Opportunities for Luxury Brands:

i. Media Exposure:

The significant increase of media exposure is helping to instill and forge positive brand images. Zenith Optimedia reports that advertising expenditures in India increased from US$1.1 billion in 1996 to US $4.7 billion in 2006. Forecasts suggest spending on advertising will exceed $7 billion in 2009. Increased product knowledge and brand awareness are translating into greater consumer confidence – an important catalyst for luxury consumption in a fast-emerging market.

ii. Increasing Number of “Indian Globals”:

McKinsey forecasts that the Indian middle class (defined as those with disposable incomes from 200 thousand to 1 million rupees a year) will increase from approximately 5% to 41% of the population, and will become the world’s fifth largest consumer market by 2025. Indeed, the desire for international brands is also driving consumption abroad. According to a study by Visit London, Indian visitors to London spent more than Japanese tourists.

Merrill Lynch and CapGemini’s World Wealth Report 2008 says India, China, and Brazil had the highest High Net-worth Individual (HNI) growth at the country level. Not just that, in 2007, India actually led the world in HNI population growth at 22.7 per cent, exceeding gains of 20.5 per cent in 2006.

iii. Market Regulation:

Although high import duties on luxury goods continue to prevail, India’s policy of liberalization and deregulation has improved its image as an attractive destination for foreign investment. Foreign companies that sell products under a single brand, such as Ermenegildo Zegna, have recently been allowed to acquire up to 51% in Indian joint ventures. The introduction of market reforms is winning over the long-term commitment of foreign investors.

iv. Looking beyond the Obvious:

Luxury brands in India need to look beyond South Delhi and South Mumbai. There are about 16 lakh homes in India that annually spend at least Rs 4 lakh on premium and luxury products and services. Alongside, there is another emerging India, of 400 million upper middle class, with rising disposable incomes and big aspirations. But are luxury brands missing the opportunity? The answer may be ‘NO’ as a luxury brand like Swarovski is planning to have its boutiques in cities like Surat, and Ahmedabad to tap this market.

With a whole new lot there waiting to be tapped, experts believe that the dynamics of Indian luxury market are set to change. Where it may be early for the luxury brands to set up retail space in small rich towns, direct mailers, and relationship building might be the need of the hour.

In India, the expatriate population is on the rise, thus giving one more reason for the luxury brands to come and stay here.

v. Emerging Retail Avenues:

New retailing opportunities are also quietly revolutionizing the format of luxury retailing. Luxury boutiques were traditionally confined to the secure but often inaccessible surroundings of exclusive hotels. The shopping mall boom is set to democratize luxury consumption.

With pioneering of projects such as the opening of the Delhi luxury-goods mall Emporio and UB City, Bangalore, shoppers will not only be overwhelmed by over 70 international high-end brands, but will also be immersed in a pleasurable and memorable shopping experience.

Also, with the increasing number of world travelers and air passengers, there will be an increase in duty free shops at airports. Luxury brands can look at this retail option to reach out to their audience.

vi. Increasing Number of Indians Making Trips Abroad:

According to industry estimates, the number of travelers visiting foreign stores is poised to touch 12 million by the end of this year, about 2 million higher than that in the last year. Indians who travel abroad are generally top of the pyramid and have high disposable incomes.

Interestingly, the PATA (Pacific Asia Travel Association) – Visa 2006-2007 report estimates that outbound travel from India in 2010 will be around 16 million. The figures show that people would be more acquainted with the brands after making trips abroad, and thus, this will be beneficial to the luxury brands.

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