CO-BRANDING: AN OVERVIEW

Winning through partnership

Through co-branding strategy, the new entrants in retail market have successfully established their brand identity and created new consumer base

In today’s competitive market scenario, where every category has different brands offering product with similar features and price points, it’s become very challenging for a new brand to sustain in market and create a new consumer base. As a brand building alternative, most of the brands launch their new consumer products through co-branding. It is a proven concept where two or more brands merge together to become a single product.

Objective

The co-branding strategy has been used by players in every sector be it automotive or consumer durable or apparel brands or fast food giants. Many leading brands and retailers use this marketing strategy in order to attract new customers, increase the brand awareness, support the customer loyalty etc. The aim of co-branding strategy is to combine two brands in order to attract more customers and to maximize the power and prestige that each brand has to offer. The partnership helps in opening up new markets and marketing opportunities for both brands.

Different forms of co-branding

There are four different forms of co-branding. The first form is ingredient co-branding – an example could be Dell computers with Intel Processors. Next form of co-branding is same-company co-branding – a Titan watch from the house of Tata is an example of the second kind.  Joint venture co-branding is yet another form of dual branding – the case of Godrej and Procter and Gamble is example of this kind. And last is multiple-sponsor form of co-branding, where co-branding of two or more companies work together to form a strategic alliance in technology, promotions, sales, etc. The example would be the case of HCL computers with hardware alliance of HP, processor alliance of Intel and software alliance of Microsoft.

Advantages

Through co-branding both brand and consumers are benefitted. The brand gets preliminary benefit of instant brand recognition in markets where there may not be any consumer awareness (at the launching stage) or a lesser degree of consumer awareness a company desires. Other benefit is the financial advantage provided by the alliance. It results from the sharing space, which lowers operating costs, maximizes marketing dollars through joint promotions and increases marked exposure with one product carrying both brand names.  Consumers´ attitudes toward a particular brand alliance influence their subsequent attitudes towards the individual brands that comprise that alliance. 

Disadvantages

Despite all the advantages of co-branding, there are possibilities that the strategy may have negative effect on the partner brands due to co-branding. The strategy may fail if the two products have different market and are entirely different. If there is difference in visions and missions of the two companies, then also composite branding may fail. If the customers associate any adverse experience with a constituent brand, then it may damage the total brand equity. Once a brand takes position in the market, it becomes difficult to dismantle the co-brand. Also it will become a big challenge for brand to re-establish the brand identity alone.

Future of co-branding in India

As the consumer in today’s modern era are more informative, demanding and conscious about their buying behavior, the need for co-branding in retail will increase in future. Many foreign giants are venturing into Indian retail sector in strategic partnership with Indian companies – the example will include Wal-Mart, Metro, and Tesco etc. With advance technologies in modern retailing, it is now possible to know the exact information about consumer shopping habits, which further will help retailers to improve marketer knowledge and strategies. As additional market sectors become more and more difficult to penetrate for newcomers, co-branding may be preferred as a faster, cheaper and safer growth strategy.

Reliance Brands limited strategies

Reliance gives its premium brands a ‘personal' push

Reliance Brands is banking on personalised service such as ‘outside-shop' purchases and customized services to push sales of its high-end branded apparel. The company, a fully-owned subsidiary of Reliance Industries, is into high-end retailing and has exclusive sales and distribution licences for six international apparel and footwear brands.

Currently, Reliance Brands offers personalised services on two premium brands that include casual wear maker Diesel and apparel maker Zegna. Nearly 10 per cent of the total sales value in Zegna and Diesel stores are through outside-shop sales (home delivery of apparel without the customer visiting the store), company sources said.

They are adding value to the brand through the concept of personalized services. over the next few years, the company was expecting nearly 20 per cent of its revenue through outside-shop sales.

VIP ROOM FACILITY

While outside-the-shop selling remains an option, the company currently has a VIP room facility in its Diesel store in Juhu, Mumbai. The room is booked exclusively for the customer, who will not have to go around the shop. The apparel and the latest designs will be brought to the customer by company-appointed personal managers.

VIP room facilities and home delivery of apparel is available at no extra charge. International brand Louis Vuitton's New Bond Street outlet is known to offer such lounge services for its high-end customers.

MADE TO ORDER

Another of the company's strategies has been the introduction of made-to-fit tailoring. Particularly available in Zegna stores, the concept involves having designer suits tailored to the customer's measurements by Italian designers. This is a premium service available at an extra cost. Made-to-order suits are priced at least 15 per cent higher than a normal Zegna suit.

Reliance Brands has associations with Diesel, Timberland, Zegna, Paul & Shark, Quiksilver and Steve Madden. The company operates through exclusive stores for each brand. It has 20 exclusive stores, of which Paul and Shark and Zegna have four stores each, while Diesel has seven such outlets. Reliance Brands has five Timberland stores and is yet to launch the Quiksilver and Steve Madden brands in India.

Buzziest Brands of 2011

Buzziest Brands of 2011

Buzz is the excitement and interest generated towards a particular brand. It can be positive, negative or even remain neutral. Many brands use different media like TV, newspapers, social media etc. to create a buzz or do the same through innovations in products, targeting new customer and entering new geographies. And many simply use brand associations which target the masses.

Afaqs recently released its survey on Buzziest Brands of 2011, which gives pretty interesting results. Afaqs.com, one of the most visited site for all the news related to advertising, marketing, media relations and communication in India. A shortlist of 60 brands was created where 40 brands were chosen on the basis of 2.5 million searches carried out in 2010 on Afaqs. While the remaining 20 were selected by the editorial committee on the basis of the excitement being present on social media and other forms of digital media.

The top 15 buzziest brands give out a peculiar trend. There are 6 technical brands and 5 telecommunication brands. This makes one realise how important technology has become in today’s world. So let’s discuss the ones in the technical bracket first.

Facebook is currently the buzziest brand and the leader of the pack. This is followed by Blackberry who have repositioned themselves amazingly over the past year or so as the most important thing for 20 something’s.

They are followed by Tata Docomo and Micromax both of whom are becoming the darling of the advertising and communication industry. Micromax is the first Indian handset manufacturer to be in this list and is miles ahead of the declining Nokia which is at number 13. This is followed by Idea, Google, Airtel, Vodafone, Aircel, Nokia and Twitter. Idea and Nokia have gone down drastically due to the former’s poor work on the advertising front and the latter’s inability to fight with competition on all the fronts.

Though Airtel’s rebranding exercise has been a miserable flop, it has managed to rise 7 positions much to everyone’s amusement and surprise. People seem to have lost interest in Vodafone’s zoozoos while Aircel’s communication on future of mobile telephony has positioned it smartly in this segment. Interestingly Twitter has gone down drastically from its 3^rd position last year to the 14^th position this year. Looks like the initially interest has faded out.

The 4 non – techie brands in the list are Volkswagen, Cadbury, Coca – Cola and IPL in that order. All of them are surprises in a list of techie heavyweights or ones which are discussed online much more than the usual brands. But what helped them in some way or the other is the communication, advertising and marketing they created around their brands which got them the buzziest tag.

Starbucks India

Starbucks meets Tata for coffee

                              

The US-headquartered Starbucks Coffee Company is finally entering India by signing a memorandum of understanding (MoU) with Tata Coffee Ltd, a subsidiary of Tata Global Beverages (formerly Tata Tea).

To begin with, the MoU will create avenues of collaboration between the two companies for sourcing and roasting high-quality green coffee beans in Tata Coffee's Coorg facility.

In addition, Tata and Starbucks will jointly explore the development of Starbucks in retail outlets and hotels for its iconic coffee brand.

At a later stage, both Tata Coffee and Starbucks will consider jointly investing in additional facilities and roasting green coffee for export to other markets.

The Seattle-based Starbucks , is a premier roaster and retailer of specialty coffee in the world and manages over 16,000 stores and operates in more than 50 countries. Till recently, according to industry sources, the Bharti Group was in the running to bring Starbucks to India.

This MoU is the first step in the entry of Starbucks  to India. They are focused on exploring local sourcing and roasting opportunities with the thousands of coffee farmers within the Tata ecosystem. Starbucks believe India can be an important source for coffee in the domestic market, as well as across the many regions globally where Starbucks has operations.

Don't ask for eggs, but ask for Keggs

Hatching the Keggs:

How Vinod Kapur made the faceless egg a branded, packaged item!.

Vinod Kapur, Chairman, Keggs Farm

Don't ask for eggs, but ask for Keggs.' This tagline was hatched back in the mid-1960s. But it was only 40 years later, in 2005-06, that Vinod Kapur actually began selling branded eggs. With Keggs eggs now a recognisable brand — at least in North India — Kapur's dream of making the commodity item move like a packaged and labelled FMCG product has finally come true.

Back in the 1960s, when Kapur was progressing very rapidly in his MNC job — he was already the country head of matchstick major Wimco (then owned by Swedish Match) —  his dream of entering poultry farming appeared like an idealist's whimsy. Especially considering that he knew nothing about the business and the primary motivation was that he loved eating eggs for breakfast! He and his wife would sit and talk about what they would call their business, until they came up with the name Keggs (Kapur + eggs = Keggs) and the famous tagline. The egg literally came before the chicken in Kapur's case!

Now that he sells 6-7 crore of the premium Keggs eggs annually and demand is picking up faster than he can meet supply, and the other side of his business — the rural poultry programme — has become a model case study, the 76-year-old Kapur can afford to sit back and smile proudly.

‘Happy eggs
 The Keggs eggs' attributes of high quality and trust, built painstakingly through word-of-mouth and usage. No advertising at all.  The tan-coloured eggs, which are slightly larger than the normal commercial ones, come from cage-free birds raised in humane conditions, reared on near-organic feed with no growth promoters.  “Happy birds lay happy eggs”, is Kapur's ruling motto.


Packed in batches of six in green eco-friendly boxes, the Keggs eggs are priced at Rs 50 as opposed to Rs 25 for the other eggs in the market. Each Keggs egg carries a hologram to prevent counterfeiting — necessary now, as they have spawned copy-cat products.

If a product is good — especially a food product — it will speak for itself and need no advertising,”, Chefs from the premium Four Seasons Hotel in Mumbai came knocking at his farm in Gurgaon, asking for a daily supply of Keggs eggs. Today, Keggs eggs not only reach 500 retail outlets in Delhi/NCR but have also managed to penetrate Chandigarh, Lucknow, Kolkata and Mumbai.

This year, They have peaked at 6.5 lakh eggs per month, while the demand for our eggs stands at 7 lakh .Next year, Kapur's intention is to take the production of branded eggs to 9 lakh.


Diversified business
Of course, branded eggs are only a small part of Kapur's business. From breeding to vaccines to feed, the group addresses all the niches in the poultry business.

In the last 40 years, Kapur has had to keep rejigging his business model to keep pace with the changing economic realities, from the Socialist era to liberalisation to the competitive consumption era. Along the way, he has had to take some calculated risks, especially when he changed from conventional poultry to a radically different model.


Today, Kapur's rural poultry experiment touches a million below-poverty-line families, and has aroused interest in the UN and other development circles, with the model now being replicated in Africa.

The model was simple as Kapur explains in his travels into the interiors, he found that it was the women who raised hens in villages. If only he could give them an acceptable desi-looking scavenging breed but with a far better yield! Some smart genetic engineering resulted in the dual-purpose Kuroiler breed that could produce far more meat and eggs (200 as against the 40 that the village hen used to lay) and yet survive in Indian villages in free-ranging conditions.

The common thread in the rural model and the high-end premium branded model he created, is that he found a gap and stepped neatly into it.


The Kensington Golden variant — again a breed that Kapur's company created — gets a diet of maize, spinach and lots of greens. The result: it lays 250 eggs during its cycle that are not only larger than normal eggs but have a rich golden yolk.

Kapur innovated on the distribution model as well. Typically, eggs move the commodity cycle route — they are sold to middle-men who, in turn, sell to retailers and by the time it reaches the shops, they are 10 days old.

At the Kegg farms no egg is stored for more than three days and if eggs go unsold in the shops for 10 days, they take them back. “You can't get fresher eggs than that,” 



Riding on the popularity of his Keggs brandhe is building a foods division. The long-range plan is to move beyond eggs.  I have some ideas and will only launch products that are very exceptional and fall into the consumption pattern of existing consumers.

Finally, how does Kapur himself likes his eggs? “I am a fried egg man or like it boiled the classic four-and-a-half minutes,” he says.

Brand Stereotypes

When stereotypes are welcome:
How brand associations create strong buying propositions for a product..



Brand stereotypes can create strong propositions. They create differentiation that may be difficult to dislodge by late entrants to a product category if the brand is nurtured well.

Of brand associations: The Lifebuoy, Lux and Pears brands have introduced product improvements in terms of their ‘germ killing' abilities to enhance and sustain the appeal of their stereotypes over time. The Santoor brand, on the other hand, tries to build on the positive associations of a turmeric-and-sandal offering. The Big Bazaar brand (top, right) has developed the stereotype of a middle-class, budget-oriented and value-based offering, just as Titan (above, right) has come to be associated with gifting.

Stereotypes in commonplace parlance are more associated with run-of-the-mill images. In the context of consumer behaviour, it is associated with meanings and pictures that are carried by consumers in their psyche.

Bru — does it suggest filter coffee? (One of the recent visuals in a TV commercial shows a filter that is used to make coffee in the traditional way and the brand has had a strong association with filter coffee.)

Titan — does it suggest gifting?

Private label black-coloured bathroom cleaner — does it suggest that a dark colour is associated with killing odour?

LG and Samsung, late entrants in several consumer durables categories in India, have not projected their country of origin as part of the stereotype associations of their brands. These are examples of how the principle of stereotypes can be applied to brands.

How do brand stereotypes help?

Brand stereotypes can create strong propositions. They create differentiation that may be difficult to dislodge by late entrants to a product category if the brand is nurtured well. Let us even consider the local sweet shops and not just the megabrands.

Grand Sweets in Chennai and Haldiram's in Kolkata are strong brands backed by stereotypes that have been associated with the unique taste of these offerings.

Big Bazaar, besides its huge stock-keeping units and variety, is also associated with the stereotype of middle-class, budget-oriented and value-based offerings. In reality, there may be several retailers in a city or several offerings that may be of value to consumers but the development of stereotypes helps brands stay entrenched in the minds of consumers.

An entrepreneur offering house repair services needs to build up a stereotype that would get latched to his target segment. This is more important in an emerging market where several categories are characterised by the unorganised sector.

For instance, the footwear market and the household furniture market are characterised by several manufacturers, some of them delivering high value and several delivering below par offerings.

There are a few branded offerings, normally in the higher ranges, providing even small manufacturers a clear opportunity to develop unique stereotypes in their respective territories.

The fewer the branded offerings, more the scope for the development of stereotypes. Even branded offerings, after they taste success, need to build or nurture the stereotypes they may have got associated with or built over a period of time.

HMT had advertised itself as the “timekeeper to the nation” much before branded offerings or Titan entered the market. Mysore sandalwood, that was almost a legendary offering (with a cross-section of consumers using the offering for six decades), got associated with very positive qualities much before the entry of the Santoor brand that has a turmeric-and-sandal offering (and built up a stereotype of an authentic, traditional, sandalwood application for healthy skin).

Brand stereotypes take definite shape over a period of time to ensure that the brand stays differentiated.

Product improvement sustains appeal

But brands also need to bring in attribute /product improvements that enhance and sustain the appeal of the stereotypes over time (Lifebuoy, Lux and Pears are good examples). Unilever has interestingly used three stereotypes to address the “germ killing” proposition and the three stereotypes are associated with three well-known brands.

Lifebuoy, with its macho associations of yesteryear, was more a rural soap with the proposition of germ killing action. Its urban repositioning used the same stereotype with changes in the offering and packaging and by moving it closer to the family. The germ killing action was advertised for its Total variant with the ‘mother-son' association. Associations have been added but the basic stereotype is the same, that of “germ-killing action”.

Hamam in the latest TV commercial indicates rashes caused by external exposure (may be perceived by the consumers as germs), but has created a stereotype of “traditional family usage”.

The visual shows not just the mother but the grandparents speculating about the rashes.

Pears, the brand with the “young and innocent” stereotype of yesteryear, has a germ shield variant. The TV visual of the brand (in recent times) shows the “mother-daughter” association.

In all the three cases, the past associations/brand's proposition have been preserved but the stereotypes have been used for differentiated imagery. (Pears introduced a “germ kill” variant.)

There may be other aspects such as price and target segment that may be involved in the strategy of these brands which have complemented such strategies.

Stereotype concepts can contribute to brand associations — whether new or old — if used with qualitative research on consumer associations.

Brand Quest

HI FRIENDS,  here the answers for the yesterday Brand Quest.

• 'Now Everyone Can Fly' is which low-cost carrier's baseline?

          Air Asia ('Now Everyone Can Fly' is its baseline)

• EMPTY MARK-I
  Unscramble the above for the name of a travel company.

          MakeMyTrip (EMPTY MARK-I unscrambled)

• Identify this chipmaker.

 Microsoft Lync

• Which Dutch car brand featured in Sharon Stone-starrer Basic Instinct 2, is all set to foray into India?

           Spyker (The Dutch car brand is eyeing India)

• Who's this?

Sashi Ruia, Chairman, Essar Group

• '... Runs Deep' is the marketing theme of which auto brand? The missing word is a nickname!

             Chevrolet; the missing word is 'Chevy'

            ('Chevy Runs Deep' is its new marketing theme)

• Which Indian group acquired English Premier League club Blackburn Rovers recently?

          Venkateshwara Hatcheries (It acquired Blackburn Rovers Football Club)

• Which Japanese strategist developed the concept of an 'M-shape society'?

          Kenichi Ohmae (He developed the concept of an 'M-shape society')

Harry Potter

The magic of Harry Potter!!

What makes Harry Potter one of the biggest brands of our age?.

Harry Potter has become one of the biggest fictional brands of our generation. Ever since the first Potter book was published in 1997, over 400 million copies have sold, making it one of the bestsellers of all time. The first Harry Potter movie ranks amongst the top 10 grossers of Hollywood, and the first six movies have earned an astounding $5.7 billion. Brand Harry Potter commands levels of recognition and buzz that most consumer brands would die to achieve. What explains this magic, and what learnings does it hold for us? Here are seven lessons from Brand Harry Potter.

• THE BRAND HARRY POTTER IS BASED ON A POWERFUL HUMAN INSIGHT.
• THE BRAND ENGAGES US SPLENDIDLY.
• THE BRAND IS SUFFUSED WITH EVOCATIVE SYMBOLS AND RITUALS.
• THE BRAND HAS CREATED ITS OWN LEGENDS.
• THE BRAND HAS DEVELOPED A DAZZLING ARRAY OF TOUCH POINTS.
• THE BRAND HAS LEVERAGED NEW-AGE MEDIA VERY SMARTLY.

"As you contemplate the seventh lesson, don't forget to enjoy the seventh Harry Potter movie."