Saturday, July 11, 2009

A quick checklist for companies looking at Umbrella Branding/ Single Brand/ Brand Integration Strategy

1. House of Brands v/s A Branded House: choose the approach
Most consumer product conglomerates, such as Procter & Gamble, Johnson & Johnson, and Colgate-Palmolive, use the “house of brands” strategy. In other words, the product has the main brand name: Listerine, Head & Shoulders, Tylenol, and so forth. Very few consumers could accurately say which brand is owned by which company.’

On the contrary companies like Samsung and Sony still put their name on everything, but iPod and Zune are the dominant brands, leaving Apple and Microsoft to a lower-level brand. This is because people can only associate one brand with a product. A ‘branded house’ approach suits the companies where product life is expected to be longer. The ‘reliability over a time’ becomes the guiding principle for brand value.

2. B2B umbrella brand promotion in consumer space creates inexplicable demand pullAccenture sells nothing to consumers. But its ‘Performance Delivered’ campaign, backed by the advertising presence of Tiger Woods, has created a positive awareness of the brand among hundreds of thousands of people who may be working for the enterprises to which Accenture consults (or is seeking to consult). And the motivational value of inviting top customers, prospects and employees to golf events involving Tiger cannot be underestimated.
Intel is the ultimate ingredient brand. Zero sales to end consumers yet Intel built a consumer demand pull for its chips that required every PC manufacturer to incorporate them and to advertise Intel Inside on their products and in their ads.

3. Brand is an idea, Branding is a mindset
While assimilating an umbrella brand, it is important to step aside for a while from the existing brand portfolio. In the B2B enterprises, the brand portfolio is usually consisting of the existing company names/legal entities. While consolidating or creating a new umbrella brand, one can choose to create/architect a totally new name which makes lot of future sense but has little connection to the existing entity names. Equally important is to create a ‘brand thinking’ mindset in the company and the stakeholder, who may be too used to thinking ‘products’, ‘technologies’ and ‘business verticals’.

4. Create a unique character, written down and passionately curetted
Al and Laura Ries, in their book The 22 Immutable Laws of Branding, say that successful brands associate a ‘target concept’ (or a core character) with their brand, and that sub brands and super brands are recipes for disaster. Witness the lack of success with brands that try to be everything to everyone: Yahoo, GM, Ford, and to a lesser extent Hyundai, Yamaha, and Mitsubishi have not established a dominant foothold in their spaces because consumers have not associated a ‘key concept’ to their brand.

Samsung believes that their brand has four essential values- First one is technology value because they are a manufacturing company. The second is the product value. The third is marketing value and the fourth one is reputation value.

5. Architect the brand to be driven by Customer Centric World (and not Technology)
Organise your portfolio in a customer-centric way — for instance, ensure that the portfolio strategy drives your R&D strategy rather than allowing R&D to determine how your company goes to market. Both AT&T and IBM saw strong business growth as a result of this shift in mentality. Vertical wise split helps internal organization but not the brand penetration and recall.

6. Create clarity of offerings through architecture
Make sure that your product/service offering is clear to both your customers and your employees. If they are not able to understand what you are offering, it is a signal that the current architecture is not working. Organic expansion of enterprises usually results into an obfuscated and overlapping view of the business offerings, which needs an overhaul at the time of rebranding.

7. Differentiate and Cater to both- Product Buyers v/s Solution Buyers
· “Product Buyers” look for specific product sets and sophisticated components and thus require a wide variety of distinct products.
• “Solutions buyers” are less expert and seek holistic business solutions that are all-inclusive and off-the shelf.
Future is about dynamic companies who can sense the consumer needs faster and can bring solutions to the table, the fastest. A brand stitched around this core thought will generate internal energy to be more efficient through the value chain.

8. With Single brand, the measurement indices related to ROI on marketing becomes more tangible
Typical engineer’s mind usually distastes the grand marketing strategies and expenditures thereof. They understand the language of ‘selling’ much better. In a growing B2B enterprise, unifying the brand brings better indices of measurement of ROI on marketing spends and consumer satisfaction thereof.

9. Use the slow-down to promote the renewed brand
Samsung invested in product innovation way back in 1997 when Asian Crisis was on. Samsung also took up the Olympic Sponsorship when the company was almost bankrupt. All this paid off.


Author: Manoj Kothari, Founder Director and Principal Strategist at Onio Design Pvt. Ltd., Pune, India


Friday, July 10, 2009

Lessons from slow-down and Trends for Innovation 2010-2011

IMF projects India as the next boom place as the recession seems to be closing shop now on. While the new government in India is upbeat and heading for 9% growth, IMF has been moderate in the response and pegs it at 5.4%. The new budget just presented, focuses decidedly on infrastructure development and boosting rural economy. 55% of India’s FMCG consumption is in rural areas and 60% of population lives in the rural areas. Whatever strength Indian economy has shown till now is thanks to the robust banking system and the unwavering rural economy. There are some lessons hidden in the entire episode of slow-down that we are passing by. As a trend reader, it would be worth a look for deciding the future course of strategy for any organisation keen on India.

1. What worked till now, will not work!
Time for applying the formula is over. Swings in the economy, has never been so frantic and severe in pitch earlier. All that is learnt through case-studies is going to be useless. Time for mindless collaborations, copycat proliferations, riding on established brands and taking the consumer for granted is over. It is going to be the time of entrepreneurs and cautious adventurers. Being ‘visionary’and ‘pragmatic’ are not mutually exclusive anymore.

2. What is costly, will have to have a damn good reason for it!
Brand alone will not sell a product. Superficial motifs and bloated ego mongering products and services will have to come to terms with a wiser world. It started becoming clear even before the recession set in, when companies were looking for ‘real differentiators’ through design rather than from a propped up branding campaign. But signals now are loud and clear in the favour of the same.

3. There is wisdom in ancient wisdom!
Grandma says, “Simple Living, High thinking” is the best policy. We never heard. India was never ‘styling friendly’ as a culture. We believed in ‘inner substance’ all the way. ‘Life beyond material life’ has always been the motto. Somewhere in the whole consumerism zeal, we started losing that. Slow down will act as a corrective booster and will bring back this thought big time.

4. Small living
Another rejoinder to the wisdom from the ancient- Small Living is all about Ver 2.0 of bottom of the pyramid. The sachet revolution really brought forth the power of numbers in India. Propelled by the new economic reality, from Nano cars to Nano housing, a lot more is going to go small. New luxury would be ‘Compact , Efficient and Earth-friendly’, and not ‘Big, Indulging and Phantasmagoric’.

5. Only naked electric wire is untouchable!
As the government pushes more and more reforms, mobility and communication for all, borders of mind will be overpowered by the borderless mind. Brackets that worked in the yesteryears, in terms of caste, regionalism and insipid culture, will be replaced by rationale and inclusivity.

6. Longevity, the new virtue!
Use, Use, Reuse is the new mantra that will supersede the hollow calls of ‘sustainability’. Recycling consumes a lot of energy. Reuse is easy. It is immediate. It puts creative energies to use. It saves money. What else could a consumer want? Companies need to make products that last long…very long. Warranty has to go, Guarantee has to come in.

7. Don’t design for ‘avatars’, it is the ‘attitude’ back in vouge
Booming economy and downloadable ‘skins’ made consumers believe that they are a part of the global ‘personality orgy’. It is time to give it a break at look at the basic ‘attitudes’; the DNA of individual consumers. ‘Sporty’ is for sportsmen, and ‘feminine’ is for females. Don’t mix the things that don’t.

8. DIY (DO IT YOURSELF) is equally for India
It eluded India till now. IKEA back-tracked for different reasons, one of them could have been also a possible impression that ‘Indians don’t like to do things themselves’. It is time now. Time to wash own utensils and iron the clothes. Superfluous luxury has to give way to healthy practices of self-help. Host of products and services are waiting to tap this arena.

9. Twittering gives way to Meeting
Social Networks were good for a pass time and as a date with the new technology. Inside became outside in the years of Social Networking; almost a voyeuristic utopia.
Is this phenomenon only going to head straight in the same alley, or take a turn? Well, more rationale is going to dawn in the conversations and probably the “Meetups” would help getting ‘real’ about networking. Blog and not Tweets, evolving into a natural community, would be one of the great tools for the next version of social networking.

10. Culture Farming
Cocooning is a global phenomenon. Too much exposure, tires. People recede into ‘familiar’ or ‘loneliness’. A society pushed into modernity and consumption too fast, has its backlash coming. People want to hold on to something in the torrent. Culture and traditions would be rediscovered. Forgotten rituals would be back with a modernist zing. However, this time the cocooning would give way to full-fledged organized farming of ‘culture’. They are selling tickets online to the next event of ‘Karwa-chouth’ Workshop for First timers; any takers?