Brand Update : Philips To Acquire Preethi

The famous Preethi brand of small appliances is going to get a new high profile owner. The Dutch consumer durable giant Philips has agreed to acquire the assets of this homegrown brand.This move came as a huge surprise and  I never thought that Preethi could be a candidate for acquisition. Preethi brand was founded in 1978  and the  owners - M/s Maya Appliances has carefully nurtured this brand. 

The brand developed its mixer range quite beautifully and through careful product development and meaningful advertisement campaigns. The brand had constantly adopted the positioning based on durability and reliability which was communicated through the tagline " I Guarantee ".

Now once the acquisition is over, it will be interesting to see how the brand will fit into Philips' overall branding strategy.There are chances that Philips will use Preethi as a sub-brand with endorsement from Philips. 

It is also interesting to see how the brand image of Preethi will change with the endorsement from Philips. Suddenly the homegrown image of Preethi will vanish.

Through this acquisition, Philips will gain huge market in the mixer grinder segment. Philips will also get instant sales and service network of Preethi ( even though Philips has its own robust distribution network).More than that, Philips will get that vital market knowledge that Preethi had acquired over these years.According to news reports, after the acquisition, the company will be run by existing promoters. It will be interesting to see how this acquisition will turn up for this nice brand.

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Preethi 

Brand Update : Perk Struggles To Find Right Positioning

Perk which went in for a massive brand repositioning exercise last year is now struggling hard to find the right positioning. The brand which created ripples in the market with its perky campaign with Priety Zinta, is now searching for a positioning that makes sense.

Perk and Kit Kat created much sensation during the late 1990's with both brands trying to outsmart each other with smart campaigns. But soon the market turned cold towards this wafer based chocolate brands and the wafer chocolate category never grew as expected.

In 2010 , Perk went for a major repositioning/ rebranding exercise where the entire product properties and brand elements were changed. Perk began advertising focusing on its glucose content. The brand also changed the tagline to " Sapnoan se race kar le". The theme was more emotional and the brand was trying to ladder up to a higher level concept of " reaching out to dreams".

Now within 8 months of the rebranding, Perk was again forced to change its positioning. The brand chucked its attempted laddering and crash-landed to a very rustic and " funny stuff". The brand retains its focus on Glucose content but the execution strategy has been drastically altered. The brand now has the tagline " Perk Ghao , Glucose Chadao" roughly translated to " Eat Perk and Inject Glucose". Just see the drastic shift the brand made from its earlier positioning of " Chasing dreams".

Watch the ad here : Tired Son ad

There is no point in commenting on the individual merit of this ad,

I have a strong feeling that the brand has lost its way. For the past few years, Perk has been struggling to find a strong positioning. Earlier , the brand ran a few commercials featuring a young guy lost in an island and the tagline was " Take it Lightly". Now the positioning is miles apart from the past campaigns.

The basic marketing theory demands that positioning be consistent and significant/meaningful. Most marketers try to make the positioning meaningful but does not think that positioning should be consistent. While a positioning based on glucose content is meaningful for a consumer , the lack of consistency in the positioning of Perk makes the message less sticky or worth remembering. Such frequent drastic changes in positioning will do more harm for the brand in a long-term perspective.
What Perk needs to do is to do some soul search to find the right brand manthra. Once that is found then resist all temptations to deviate from the core manthra.

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Perk

Brand Update : Flipkart Goes for Rebranding

Is three years too short for a rebranding exercise ?? Flipkart thinks that it is not. The brand which started off as a no-nonsense online bookstore has transformed itself in many ways within a short span of three years. May be in digital marketing world, three years may be equivalent to three decades.

Flipkart made its major change in the business model in 2010 when it included movies and mobiles in its offerings. The brand shed its image of a bookstore and moved into an online store. Now in the beginning of 2011, the brand has made significant change in the logo and other brand elements such

as color scheme and website design. The new logo now carries the brand name and an emblem too.

Simplicity and minimalism which was the trademark of Flipkart logo has been compromised for this rebranding exercise.

But why do a brand which is just three years old do a drastic rebranding exercise ? Has the old brand elements became stale ? or is it a change for the heck of it ?According to a report in plugged.in , Flipkart is going to launch more products in the consumer electronics space and the current rebranding is aimed at that.

I am totally confused with their business model right now. Flipkart may have tasted success in their mobile + movies vertical and this may have given confidence for a full fledged transformation from a bookstore to an online store. The next logical step would be to change the landing page for the site. The landing page is still the bookstore and it will be matter of time that flipkart will change the landing page by including other product categories.

So another brand has moved from a simple solution provider to a metamediary solving many problems. I will miss the minimalism and the focus and the simplicity. It may be that an e-commerce site cannot survive on books alone. However, this change of Flipkart opens up an opportunity for a simple online bookstore.

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Flipkart

Marketing Strategy : Branding Basics for Small Business

In most of the marketing literature, branding strategies are usually skewed towards large businesses. The nature of these strategies also demands heavy and sustained investment in brand promotion and brand equity development. Often such high decibel brand promotion strategies create an impression that branding is a game for large players.

One of the fundamental question before any marketer is whether to brand or not brand. Although marketing literature suggests that there is an option for no-branding, for all practical purposes a firm cannot escape branding. No-Branding decision is where the firm chose to sell its offerings as generic products or commodities. But even in such a scenario, the firms which are marketing such generic products are distinguished by their company name which should be considered as a brand.

For example if you are a salt manufacturer supplying to retail outlets, although you are not selling branded salt, your company name will act as a brand for your customer ( retailer). Even though such firms are not into selling branded products, they have a corporate brand. Through their sales personnel and transactions, these firms are already building their corporate brand.

One of the most important advantages of branding is that brands help to identify and distinguish the seller. Even when selling commodities, the buyer needs to identify the seller and developing a corporate brand helps in getting repeat business from the customer.

Commit to Branding

The first step in creating an effective brand is a conscious decision to invest in branding the business. Whether it is a corporate name or an individual brand name, the decision to invest in branding will bring in a big difference. Branding is much more than putting a label in the cover of the product. Branding is a long term strategy which involves development of a brand vision and creation of brand personality.

Branding need not be expensive

Investing in branding is not about the money set aside for brand promotion but the level of involvement of marketers in developing the brand consciously. Small and medium enterprises have the constraint of limited marketing budget which forces them to overlook the importance of branding their products/business. But when we look at the long term perspective, taking baby steps now will go a long way in establishing a powerful brand in the future.

Big brands are built over a period of time. It is possible for small enterprises to build powerful brand through a consistent investment in smart branding practices. It is advisable to set aside a small percentage of revenue for the purpose of brand development alone. Consider this budget as a Systematic Brand Investment Plan rather than an expense.

Develop and protect the brand elements

Once a decision is made to build a brand, the next step is to develop powerful brand elements.

Brand elements include name, logo, symbols, mascots, color schemes, taglines etc. These brand elements should be prominently displayed in every communication that goes out from the firm be it visiting cards, gifts, brochures etc.

The next logical step is to protect the vital brand elements like Brand Name, Logo, etc. This is very important to prevent plagiarism and to challenge the rip-offs and copy cats.

Explore promotional opportunities

The fragmentation of media is in fact a big blessing for small brands. The proliferation of media has given lot of low cost promotional opportunities for small brands. The competition among the media has kept the advertising rates low especially for second –rung media. Small brands can make use of regional media options in a much more effective way than large brands operating in a national scale. Local newspapers, radio stations, cable TV channels offer excellent cost-effective vehicles for small brand promotions.

Brand promotions through these low cost media may not give a substantial ROI or a significant impact in sales in the short-term. In the long term, such small media exposure will increase the visibility of the brand and benefits will start accruing.

Corporate brands which operate in a business to business environment should explore their brand promotions in a different manner. For business brands, sales professionals are the biggest promoters of the brand. It is important for small businesses to ensure that the sales force is communicating the right kind of message to the customer. Business brands should try to communicate their brand message through every possible contact opportunities.

Every business has some communication materials like brochures, pamphlets etc and these materials offer some amount of information about the company and products. When endeavoring to brand development, these materials are of immense value. These materials should communicate the core Brand Manthra to the consumers. It is commonly observed that these communication materials are only used as a product catalogue rather than a branding tool.

It is a myth that brand building is expensive. Brands are built over time and through consistent systematic investment. The new highly connected environment has opened up many cost effective promotional platforms which can be used by small business to build their brands.

Originally Published in Adclubbombay.com

Nicorette : For Every Cigarette, There is Nicorette

Brand : Nicorette

Company : Johnson & Johnson

Brand Analysis Count : 470

Nicorette is a unique brand. The brand is world's best selling smoking cessation brand. Nicorette was recently launched in India by Johnson & Johnson . Nicorette is now launched its chewing gum product-line in India.

Nicorette has an interesting history. The brand is born in Sweden in 1967.

During that time, Swedish Royal Navy was facing an issue where their crew in submarines where increasingly becoming short-tempered because of the smoking ban inside submarines. Scientists discovered Nicorette while searching for an option to reduced the nicotine dependency of these marines.

Nicorette launched in the chewing gum form in India is a therapeutic nicotine-based gum which reduced the craving for nicotine among smokers. The gum when chewed releases nicotine in small quantities thus discouraging smokers from having cigarettes. The product has created a new system of Nicotine Replacement Therapy and has been claiming impressive record in helping people quit smoking.

The Indian market is especially lucrative for this brand by its sheer size. There are more than 275 million tobacco users in India. 24% of Indian males smoke and the use of tobacco in other forms like chewing tobacco is more widespread. This large size of cigarette users also results in large number of health issues and inturn large number of people who want to quit smoking. The demarketing of cigarettes by government and NGOs also increase the number of wannabe quitters.

Nicorette provides an infrastructure and a support system for those who wants to quit smoking. Rather it offers a pain-less way of quitting smoking by reducing the nicotine craving. The chewing of the gum releases just enough nicotine to satisfy the craving and over a period of time the user can reduce the intake of the quantity of gum also.

Nicorette is now availabe in two packs. The 4g pack is aimed at heavy smokers and is available on doctor's prescription and the 2g pack is available over-the -counter. The brand is currently running a TVC and ads in digital media positioning itself as an effective solution for quitting smoking.

Nicorette has adopted the tagline " Doubles Your Chances of Quitting Smoking ". The ads are catchy and the product makes sense for a person who genuinely wants to quit smoking. The ad shows a smoker wanting to quit smoking but the cigarette pack sticking to his hands ( symbolic of the nicotine addiction) despite his efforts to release it.

Nicorette launch also signals the arrival of new product categories into the Indian market. These products were existing in other developed countries for many years but the marketers felt that Indian market is not ready for such products. Now global players are becoming more confident of bring in their innovative offbeat products to India.

Marketing Strategy : Basics of Customer Service

Last day, my colleague got simultaneous service calls from 3 branches of a reputed car service firm. The call was made three days after he had given his car for service in one of the firms. Customer services failures like this is rampant in almost all sectors, which often make us wonder whether firms have forgot to understand the basics of customer service. While selling products or handling complaints, it is surprising to see a lack of basic customer service skills like empathy, responsiveness or responsibility.

Customer service is no rocket science. It does not take loads of customer data or complex CRM algorithms to provide exceptional customer service. What a firm need is the ability to understand customer’s needs and develop a human process to assist the customers in realizing their needs through the firm’s offering.

One of the fundamental requisite of customer service excellence is to treat customer service as an important strategic marketing tool. When a firm considers customer service as a marketing mix element; investment, involvement and control will be more focused. The task of ‘putting customers first’ will be considered a priority at the highest level.

In 1940s, Johnson & Johnson framed its famous credo, under the leadership of Chairman Robert Wood Johnson. The Credo made a very bold statement that “We believe that our first responsibility is towards doctors, nurses and patients, to mothers and fathers and all others who use our products and services”. The credo made the company imbibe a customer oriented culture which is now considered as a core competence. When the importance of customer service is impressed upon by the highest level of management, it becomes a culture rather than a peripheral activity of a division.

Customers always look for a single unified contact point at the company for all their requirements. Often it is the sales/marketing department that acts as the unified contact point. Although the unified contact point is supposed to facilitate two-way communication, in practice the contact is more skewed towards selling products rather than providing customer service. The management has to be careful that the contact point is given sufficient authority to fulfil the customer requirements.

The quality of customer service will come to test when customers have real issues or complaints. How well a firm approaches the complaints is the true determinant of the effectiveness of the customer service initiative. More often, consumers get stuck with their complaints because the contact point may not have the authority to initiate any corrective actions or solutions.

Customers may also have limited access to the higher levels of management. It is in this situation that firms should develop a system of escalation with regard to complaint redress. The process should have definite timelines which automatically triggers escalation of unresolved complaints to the next level of management. For example, if a complaint is unresolved (for whatever reasons) for more than 30 days, it will automatically get moved to the next level of the management hierarchy. The advantage of such a system is that over a period of time, the firm will be able to have virtually no unresolved complaints.

Another basic requirement for exceptional customer service is the human factor. Having highly motivated employees give a special meaning to the word – customer service. An example of extra-ordinary customer service was displayed in the Taj Hotel during the terrorist attack of 26/11. The entire world was thoroughly moved by the dedication of the Taj hotel staff who risked their lives to keep the guests safe from terrorists. These kinds of extra-ordinary actions can result only from a highly motivated and committed team.

While customer service needs to have a human touch, it is important for firms to back the human factor with robust processes. Processes help the firms to have a consistent level of customer service by taking care of the variability factor. Firms must build some amount of flexibility in the processes because one cannot anticipate all kinds of customer requirements and problems.

Companies should also be taking an effort to practice permission marketing while attempting to cross-sell to the customers. Permission marketing is a term coined by the marketing guru Seth Godin to denote the practice of getting prior permission of customers before attempting to sell.

Companies taking customer service seriously should understand that it cannot offer everything to every customer. It takes lot of courage and effort to identify the customer segment that the firm opt to serve. Once that profitable segment is identified, firms should not shy away from providing the best possible customer service to them.

Originally Published in Adclubbombay.com

Teflon : Life Runs a Little Smoother With Teflon

Brand : Teflon

Company : DuPont

Brand Analysis Count : 469

Teflon is a pioneer in ingredient branding . Infact this is a brand which popularized the concept of ingredient branding even before Intel's classic Intel Inside branding story. The story of Teflon is a classic and interesting story on Ingredient Branding.

Ingredient branding is a special case of co-branding where the marketer brands components or ingredients contained within other branded products.

Teflon is DuPont's brand of a chemical compound known as Polytetrafluroethylene. Teflon is a high molecular weight compound containing carbon and fluorine. The invention of this compound was made at DuPont's research center by Dr Roy Plunkett in 1938. Dr Roy was working on a experiment on refrigerants when he accidentally discovered a compound which was inert to almost all chemicals. Rather than discarding this compound, Dr Roy and his assistants tested it and Teflon was born. ( Source here)

In 1954, a French engineer named Marc Gregoire created the first non-stick Teflon coated pan (source )

Now Teflon is a powerful brand with a global brand recall of over 98 %. The brand has almost become generic name for properties like non-stickiness , anti-corrosive applications. As a consumer we use this brand in the automobile , clothing and in our kitchens.

The growth of Teflon from a chemical compound to a powerful ingredient brand was not by chance but because of a very well executed branding strategy.

The first factor behind the huge success of Teflon was the product itself. Teflon ( compound) is patented by DuPont. Hence the brand is protected against any competitive threat. Competitors had to find a way to either circumvent the patent or discover a substitute. Although there are substitutes for Teflon, this patent created a huge entry barrier for potential competitors.

The branding strategy adopted by Teflon was at three different levels.

At the consumer level , the ingredient brand has to convince the customer about the brand's promise and utility. At this level, the ingredient brand has to promote itself to the consumers through various brand campaigns. For example , Teflon is currently running a branding campaign for its Teflon Fabric Protector product.

At the manufacturer level, the ingredient brand has to convince the other manufacturers to co-brand with itself in the promotions. This is the most difficult task. The host marketer should be convinced about the ingredient brand's value and the value that it will bring to the host brand.

For example , Asian Paints had a branding campaign with Teflon Surface Protector featuring Saif Ali Khan ( Watch the ad here)

There is one more task which the brand has to do -It has to reinforce the ingredient brand's image as an expert in its field. At this level, the brand acts as endorser to the host brand where the consumer is assured that the host brand will perform better because of the presence of the ingredient brand.

Teflon became a huge brand because it was successful in establishing itself at these three levels. At the consumer level, the brand was able to create awareness and also establish confidence. At the manufacturer level, the brand was able to associate itself with a large number of established brands. At the endorser level, the brand became so strong that consumers began to prefer Teflon endorsed products over other products.

Teflon is now engaging consumers at different categories. The brand now has presence in surface protection, fabric protection, automobile segment etc. Along with that , the brand has its presence in industrial application market also.

Teflon is an interesting marketing lesson for all of us. DuPont has proven its marketing acumen by establishing strong ingredient brands like Teflon, Lycra etc. These success stories will inspire many marketers to view branding as a serious strategic tool .