Sunday, February 26, 2012

Brand Update : Will Airlines' Failure Affect Kingfisher's Brand's Equity ?

The much hyped and celebrated Kingfisher airlines is in big trouble. UB group decided to extend its beer brand to airlines and executed the branding in perfect style. The beer brand and the airline brands gelled with each other in terms of positioning and brand attributes. The airlines further reinforced the fun and exciting attribute of the parent beer brand.
Kingfisher Airlines failure is  the failure of its business model. The business tried to grow too fast burning its cash in the process. Now the brand has been criticized by the same media which once sang its glory as the poster boy of extravaganza and customer delight.
Now Kingfisher as a brand is facing its worst PR nightmare. The Airlines failed to honor its schedules resulting in a series of cancellations which led to customers getting stranded. Whatever equity that the brand had built-up seems to be gone down the drain.
So the interesting question is whether the whole issue of Kingfisher Airlines will affect its parent brand " Kingfisher beer " ? Often in marketing classes, we used to talk about the negative effect of a brand extensions failure on the parent brand. Will the same apply to the beer brand ? 

Branding literature suggest that the failure of a brand extension will affect the parent brand only if there is a strong perceived fit or similarity between the extension and the parent brand.The damage to the parent brand is more if the extension is in the similar category. In the case of Kingfisher, the similarity is only in the positioning and the categories are poles apart - one is beverage and other is a service. Another instance of the damage to parent brand occurs when there is similarity in the customer groups that use the extension. Generally literature suggests that parent brands are not much affected by the extensions' failures. ( Reference : Brands and Branding  : Research and future implications, Lehmann & Keller,2006, Marketing Science)

So it can be safely argued that the equity of Kingfisher beer will not be much affected by airline's failure. Further , the absence of competition, the ban on advertising will help the beer brand and competitors cannot take advantage of the current issue.
The extension - Kingfisher Airlines is going to have a tough time getting back the credibility of the consumers if it survives the current crisis. Consumers have a short memory and Kingfisher Airlines can find solace in that.

Related brand
Kingfisher : The King of Good Times