Omega : The Choice

Brand : Omega
Company : SMH

Brand Analysis Count : 354

Omega is a leader in the Rs 600 crore luxury watch market in India. The brand which is an aspirational brand has a long history dating back to 1848. The brand had its origin in Switzerland in 1848 when a young man named Louis Brandt started assembling high precision watches.

But it was in 1894 that Omega as a brand was created. The brand and the company went through lot of turmoils through these periods. In 1930 during the depression, the company merged with other watch makers to form SSIH. The merger was to withstand the economic turmoil at that time.

In 1980 , the brand again went in to financial crisis. SSIH then merged with another watchmaker ASUAG to form ASUAG-SSIH. Now ASUAG-SSIH is owned by a private group and the company has been renamed as SMH. SMH owns some of the iconic watch brands like Tissot, Swatch , Longines and Rado.

Omega has been very active in the Indian market for the last four years. The brand was present in the country through imports but now with the government allowing single brand retail formats for foreign brands , Omega is in full swing to tap the Indian market.

Indian market is a unique market for the watch category. I was surprised to find that the penetration of watches among Indians is abysmally low. According to reports the penetration is only 27 %. That means only 27% of Indians own a watch. The total watch industry is around Rs 2500 crores in terms of value.

The market is broadly divided into low, mass market , premium and luxury segments. 85% of the market is for watches below Rs 500.

Although the bulk of the market is at the bottom of the pyramid, the top the line watch market is growing at a rate of 25 - 30 % . Most of the growth is attributed to the economic growth witnessed by India. With new jobs and profiles taking Indians to new heights of luxury, accessories like watches gain importance in the shopping list.

Its in this context that Omega began its aggressive campaigns in India. Now most of the business and lifestyle magazine have atleast one Omega print advertisement.

Omega's marketing practice is heavily depended on Celebrity endorsements. Its a brand that has successfully used celebrities to create differentiation. Its celebrity endorsers contain the who is who of the world. Some of the celebrity who has endorsed Omega are
Cindy Crawford
George Clooney
Michelle Wie
Michael Schumacher
Nicole Kidman
Ellen Macarther
Ian Thorpe
Michael Phelps
Eugene Cernan and
our very own Abhishek Bachchan

But the most celebrated and famous brand ambassador for Omega is James Bond. I think its the first brand that has a brand ambassador in a movie character rather than the actor. Bond has been wearing Omega watches since 1995 with the movie Golden Eye. The association has been strong and Omega celebrates the launch of the Bond movies through events and special editions. In the latest Bond movie , Daniel Craig wears an Omega Seamaster Planet Ocean 600m Co-axial Chronometer with a black dial.

These brand ambassadors give a special touch of luxury to the brand. But Omega is not dependant on any of these brand ambassadors and has a personality of its own. Omega is a classic case of a brand using celebrities to its advantage.

Along with the ads, the brand is also active in connecting to the customers through events. Like any other luxury brands, Omega also sponsors sports events because sports form an important part of lifestyle.

Omega was successful because of the secondary association of its country of origin ( Switzerland). The brand has its strength in quality, brand and its heritage. What has made this brand aspirational is the consistent campaigns with a common theme. The brand is positioned as the preferred choice or the rich and famous.

Omega has a distinct advantage derived out of its heritage and strong brand equity. Since Indian consumers are well connected with the world outside, the brand's campaigns using international iconic stars works well with Indian consumers. The brand has also added a touch of local flavor by adding Abhishek Bachchan to the list.

Brand Update : Clinic All Clear

Yesterday when I visited a local shop, I noticed the new Clinic All Clear shampoo sachet. I was quite surprised by the new look of the brand. On close look, I had a feeling that the brand is silently going for a rebranding and repositioning exercise but a very discreet one.

Clinic All Clear brand is the Indian version of 'Clear ' brand which is the global brand from Unilever. By looking at the new packs and logo and the way Clinic All Clear is written on the pack, HUL is slowly rebranding Clinic All Clear as Clear.

As we know Clinic All Clear has couple of line extensions. There is Clinic Plus positioned as a family brand and also a variant for men.

Clinic All Clear is now running a new campaign featuring the brand ambassadors Bipasha and John . You can watch the new commercial at the brand's website : Clinicallclear.com.

The new ad reveals the new positioning of the brand. The brand has moved from ' No Dandruff ' to " Soft and Silky Hair " which is a major change in its positioning.

Does it mean that the brand has discarded its core positioning of being an anti-dandruff shampoo ? The faq in the website say that the brand retains its core positioning of no-dandruff but is adding additional benefits of soft and silky hair . In line with the global positioning, the brand now have Vita-Ace that fortify the hair against hair fall .

I think that Clinic All Clear wants to expand the user base to a larger audience . That may be the reason for diluting the anti-dandruff plank.

HUL is also trying to distance Clinic Plus from Clinic All Clear. Clinic is now a standalone brand with the positioning of a Health shampoo.

I think that over a period of time, Clinic All Clear will be rebranded as Clear Shampoo . Right now the typology is such that "Clear " is made prominent and " All Clear " is in a small font size. It may be a precursor to the rebranding.
HUL has been grappling with the problem of too many line extensions and brands and is finding it difficult to get the right positioning for their brands.

Related Brand
Clinic All Clear

Your views are important. Please feel free to comment on the marketing practices of this brand.

Consumer Insight # 6 : Do You Have a Plan B

Last weekend I took my family to a pilgrimage to the famous temple of Guruvayur . I booked the rooms at a decent hotel and was glad that we got rooms during the rush season. We landed at the hotel and greeted by the service staff and all went well in the beginning.

But in the evening the lift ( elevator) of the hotel stopped functioning. We reached the hotel after the tiring visit to the temple only to find that the elevator will not be functional for atleast one hour ( that's what the service staff told us). Our room were at the 4 th floor . I sat there looking perplexed since my old parents and my 4 year old child were to climb all the four floors.

There were also another family at the lobby looking equally worried since they had booked rooms for relatives who were to arrive at the hotel to attend their daughter's wedding . They looked hapless having to ask their guests to climb the stairs to the 4 th and 5 th floors.

The hotel staffs were looking equally helpless and the only action they performed was to ask their guests to climb the stairs.

At the end, we had to climb the stairs and hit the bed with all the exhaustion . We hoped that next day things will be taken care of. But in the morning , I found that still the elevator is not functioning. To much of the dismay, the room service told us that breakfast will be served only at the restaurant in the ground-floor.

This really blew my temper and I had to release all my anger on the reception staff. Then to my surprise, they offered us the Service Lift !!!! Infact the hotel had another lift that is used by the housecleaning department ( commonly known as service lift ) which was working.

They could have offered this to the customers immediately when the main lift stopped working. It could have made all the guests happy but the hotel failed to use it.

The issue here is two fold . The hotel did not have a plan B. They had one elevator and there are always a chance that these kind of problems can arise at any point of time. So in the service delivery process, the management had to forsee these kind of exigencies. If there was a plan B, then the service lift could have been made available on the spot.

Secondly the front office staff was not given enough empowerment to act during such kind of issues. The service script should be prepared in such a manner that the staff could make such kind of decisions to help the customers.

As of now, the hotels in Guruvayur can afford to make such kind of poor customer service since the demand far exceeds the supply . But tide always turns.

Brand Update : Sony Vaio

After the highly popular campaign for Sony Vaio CR range of notebooks ( All Eyes on You ! ) , Vaio has launched a new series of executive laptop Viao Z series. The new series is launched with a new theme " Break the Code ".

Watch the TVC here : Break the Code

Vaio Z is a premium executive notebook with lot of features that makes the product different from the competition. The brand boasts of
Cylinder Form
Isolated Keyboard
Carbon Fibre body
Clear Tough LCD
Light Weight etc

The current campaign is an international campaign imported directly to India although with a minor cosmetic change.
The campaign message is that all laptops are the same so break the code by getting the new Vaio Z.

The campaign for Vaio CR was popular because the visuals and the song was found attractive by the TG. The success of CR range prompted many laptop manufacturers to look at aesthetics and design as a differentiator.
The new campaign is also clutter breaking with a nice song and visuals. The lyrics goes something like this
I am not you and you are not me
I look around and all I see is me
Change the code, break the code
Take the new road

Lyrics Courtesy : Gandalf

The new series is premium priced with a price range of Rs 85000 - Rs 1,25,000.

All laptop manufacturers are faced with the issue of commoditization. So there is a heavy reliance on brand as a source of differentiation. Vaio has to a certain extend has been able to resist the commoditization .

Interestingly the tagline for Vaio is " Closer to You " . But I haven't seen any ad highlighting the positioning of the core brand Vaio. Previous campaigns of Vaio also did not have this tagline.

Related Brand
Sony Vaio

Brand Update : Medimix

In my earlier post on Medimix, I had commented that this brand has fallen into the trap of sales promotion. A recent sales promotion campaign further reinforced my take on this brand's marketing practice.

The advertisement for this sales promotion goes like this :

In a household setting, suddenly the electricity went off. The homemaker then asks for Medimix to light the candle. The husband is confused and asks how can you light a candle with Medimix. Then came the answer " Now get a Medimix Matchbox free with every Medimix soap ".

Frankly I was as confused as the husband character in the story. Medimix Matchbox ?

Then I frantically searched to check whether the company had diversified into making matchboxes. Then it would have been one of the most outrageous brand extensions ever. But thankfully the company had not yet diversified into making matchboxes.

Now the question is whether it is a wrong strategy of giving matchboxes free with soap. I guess it may not be.

But what happens here is that the matchbox is branded as Medimix and the tvc give more focus to " Medimix Matchbox " and even have a tagline for the matchbox.

Its okay to have Medimix logo in the matchbox but to brand it as Medimix Matchbox is nothing but suicide.

So an ordinary consumer will feel that Medimix has launched matchboxes ? Then what does it mean to Medimix brand ?

Its true that in the current scenario, a brand cannot notch up volumes without sales promotions . But it has to be remembered that sales/consumer promotion is a tactical strategy. In the rush to show impressive volumes marketers mess up the brand by focusing only on consumer promotions.

Is Medimix a soap or a matchbox ?


Related Brand
Medimix

Brand Update : India Post

Its more than two years since I posted the critical analysis of India Post. I had criticized about the wastage of immense potential of a service which had unmatched distribution reach across the length and breadth of India.

In 2008, Indian Government had decided to restructure the entire postal department. The restructuring exercise is called Project Arrow. The project aims to make India Post a logistics giant by leveraging the core strengths of the institution. The restructuring is being done in consultation with Mckinsey.

As a part of the restructuring exercise, the institution has redefined its business. According to Professor Theodore Levitt, Every business should ask this fundamental question : What Business are You In ? The answer to this question can throw up lot of opportunities for growth. Narrowly defining the business can create Marketing Myopia which may wipe out the business in the long run.

From just a postal institution , the department has reframed its business to be in the logistics service rather than just a postal service. The move is a significant step in broadening the scope of services that could be handled by this giant.

It is important to reinvent the business definition since the postal service is facing competition which could make its business irrelevant. The e-mail and the rise of affordable private courier services has taken away a significant chunk of profitable business of this institution. Since it is a government department, India Post could'nt change fast to accommodate the changing environment.

In line with the restructuring exercise, the department has also rebranded India Post by launching a new logo. The rebranding was done by O&M.

The new logo retains the signature red color but has made significant changes to the logo. The new logo sports a yellow color which signifies happiness , hope and joy. Red stands for passion. The wings from the old logo has been retained with some modification. The new look brand take Passion, Power and Commitment as the core brand values.

According to the press reports, 50 post offices will be refurbished to make it a new-look hi-fi post offices in the first phase of Project Arrow. The number will be scaled up to 500 post offices in the near future. The new post-offices will be technologically enabled to provide faster service to the customers. A lot of new products have also being created for meeting the new demands of the customer.

It gives me joy to see that the brand has slowly waking up to the new realities. I was surprised to find that India Post was losing almost Rs 1300 crore every year on its operations. This is despite the fact that India Post handles 10 crore Money orders and 17 crore savings accounts with deposits over Rs 5,40,000 crores. The deparment has 1,55,000 post offices out of which 89% is in the rural areas. India Post is the largest postal service in the world.

The government hopes that with this restructuring, India Post will be able to make profits rather than bleed the exchequer .

Related Post
India Post