Branding (Part - 2) - Product, Principles of Marketing | Principles of Marketing - B Com PDF Download

Product Redefinition:

What is it?
Product redefinition stands for presenting the existing product in; a changed version may be its package or its form where some qualities are maintained but product becomes more appealing. Two solid examples can be given here. Introduction of Satchet’ shampoo and gel dental cream.

Generally, lower quantity packages cost more per gram than bigger packages. In case of Satcht Shampoos, it is reverse. The reason for this is that low priced Satchets were pioneered by ‘Velvette’ and ‘Chick’.

These Satchets were procured from Small Scale packaging units where the package cost dropped down considerably. The result was that ‘Velvette’ provided the consumer with larger quantity of Shampoo at lower price than bottled one.

Hence, ‘Velvette’ gained rapidly high market share at the expense of non-satchet shampoos. ‘Chick’ followed the suit. It also gained good market. The result was H.LL’s brands namely ‘Clinic Plus’ and ‘Sun-Silk’ lost initially good market share. Soon, HLL redefined their product by giving it not only in Satchets but adding a ‘hair-conditioner’.

This satchets account for 50 percent of the total shampoo market and other 50 per cent still remains bottled. Another case is of tooth paste. Though we have even today white tooth pastes, were predominant till, 1950. In 1989, HLL introduced “Close up gel” with ad masala.

As a result market leader Colgate Dental Cream lost its ground. It was introduced on the ‘Svetal Confidence” platform than “family” platform”. With no other alternative Colgate came out with Colgate Gel whereby it gained 8 percent increase in market share.

Today, gel paste accounts for 33.33 per cent of the total tooth paste market. Those who neglected this ‘gel’ version like Promise, Babool, Forhans, Cibaca and others lost their market share. It means product redefinition takes place when the products form, shape, taste, packaging and the like change.

Category Redefinition:

What is it?
It is a case of redefining the category of products. When category gets redefined a product that was till now put to different use becomes a competitor. Take shampoos face competition from soaps which are used as hair wash say Shikakai Soap.

Further, herbal powders like ‘Raga’, ‘Meera’ and herbal shampoos like ‘Nyle’, ‘Ayur’. When shampoo came as a hair wash by using new ad theme, say ‘Clinic Plus’ made a headway and traditional hair washes faded.

Today use of shampoo is not weekly but every alternative day which has been made possible by very creative ads where a bald headed person says ‘”na” Monday ‘na’ Thursday ‘na’ Sunday”.

Category redefinition causes a completely different product to become a competitor. It causes use or user to change. It is well known fact that reinforced concrete pipes, PVC pipes are all competitors to asbestos pipes.

However, no body imagined this initially because they were operating in different ranges of diameters, length and were made of different materials. The scope of fixed and cordless telephone market is redefined by cell phones while wireless in local loop is trying to redefine the scope of the cell phone market itself.

Even Fax and Wide Area Networks (WAN) are redefining the document market which was basically the domain of courier service agencies. Thus, ‘market redefinition’ has these three aspects which together bring changes in the market that alter the terms of competition significantly.

Once we are equipped with the background material, it is now the ripe time to understand “brand success”. Brand success is the ability to retain a reasonable market share despite market redefinitions.

Professor David Arnold gives four criteria for the success of a brand.
There are:

(1) At the product level, it should deliver benefits.
(2) It should offer some intangibles besides tangible benefits.
(3) The benefits it offers must be consistent with its personality and
(4) The benefits offered must be relevant to the customer.

According to Stephen King in his book “Developing New Brands” published by Pitman Publishing Company, opines that a successful brand is one that delivers something more than function benefits.

It is worth-while to understand the other side of the story namely, brand failure Mr. High Davidson, in his article “Why Most New Consumer Brands fail” Harvard Business Review March, April, 1976 pp. 127-132 analyses brand failures in England and comes to the conclusion that most brands that fail are “me-too’s”.

A brand fails if the product displays one or more of the three features:

(1) Insignificant price or performance disadvantage
(2) Lack of difference from the existing brands
(3) A pretty old tried idea.

Mr. Rajan Chibba, in his article “Guarding against Brand Failure” published in ‘Brand Equity’ section of Economic Times of India October, 5, 1993 calculates the Delta Habit Factor to predict the success of a brand.

The Delta Habit Factor (DHF) is an Index calculated on Six Variables that measure the change of usage habits of consumers.

Therefore, according to him brand success is based on factors:

(1) Changing duration of consumption of the product.
(2) Evolving new occasions for the use of the product
(3) Changing sharing habits of the product
(4) Changing buying habits of the product
(5) Doing new things
(6) Changing the frequency of consumption of the product.

According to him the key to the success lies in the ability of change habits or usage or buying or both habits. This statement or finding goes against what is already experienced. That is a consumer will not change his habits unless sufficient and convincing reasons are provided to him or her for shifting over.

Instead, Mr. Chibba Rajan should have said that products that assist consumers functionally and psychologically are the ones that achieve success.

Let us take some four consumer products and brands and see whether they are success or failure. The four products are shampoos, talcum powders, toilet soaps and tooth pastes:

1. Shampoos:
The Indian shampoo market is of the order of Rs. 3500 million. The players in this market are HLL (HUL) with Clinic Plus and Sunsilk. Clinic plus is medicinal and Sun-silk beauty as platforms. Procter and Gamble has pentene for shining hair; HLL again introduced to overtake this Pantene namely Organics.

Palmoline launched Optima. Another variety is Lux launched by HLL as Cosmetic Shampoo. With this, <+>P&G could not keep quiet and introduced Head and Shoulder as anti-dandruff shampoo Velvette launched Rupee on Statchet.

This was followed by Beauty Cosmetics Chick brand on similar lines. Nyle herbal shampoo and Meera herbal powder another powder was Raaga. Against the Nyle herbal shampoo came Ayur. Other players are Lakme of Lakme Ltd., Ponds of Ponds Ltd. Ultra Doux by Gamier Laboratories. In addition we have Shikakai Soap of Godraj.

The successful brands are Ayur, Clinic Plus, Nyle, Meera, Organics, Pantene, Sunsilk; the failures, are, Click, Halo, Lakme, Batmoline, Ponds, Raga, Ultra Doux and Velvette.

2. Talcum Powders:
The talcum powder market of India is about 20,000 tonnes in size and growing slowly. The players are Ponds Dream flower Talk, Haven’s Garden popular in UP and Bihar and sold in large quantities because of lower prices.

Santoor’s Talk—speaks of ‘Daylong Freshness” Cinthol of Godrej Liril of HLL Zee—as south based and Yardley—Bond Cosmetics a premium brand. Others are premium by JK Helene Curtis and Denim is HLL.

Success or failure rating is done on the basis of positioning, packaging, and printing. The successful brands are cinthol, gental of T.N. is a success, Heavens garden, Liril, Dream Flower, Ponds Magic, Zee, the failures are Exotica, Sandalwood, Santoor, Yardley. About Denim, it takes time to say whether it is success or a future.

3. Toilet Soaps:
The size of toilet soap market is about 4.5 lakh tons where 200 brands are there. The national brands manufactured by three companies namely, HLL, Godrej, Tata Oil Mills Company (TOMCO) of Tata TOMCO has been taken over by HLL.

Godrej has alliance with Procter and Gamble. It is impossible to speak of all 200 brands of all companies. Let us take brands of three HLL, TOMCO and Godrej. Rest all are put in other brands.

HLL brands are Lifeboy, Lux and Rexona, Liril. Other brands are Pears and Breeze. TOMCO brands are Hamam, OK bath, Moti, Ria, Jai, Godrej brands are Cinthol, Cinthol Ultimate, Ganga Evita, Fresca, Vigil Limelite, Crowning Glory, Marvel, Coming to other brands Nirma Beauty of Nirma Chemical Works, Santoor of Wipro Consumer Products.

Mysore Sandal of Karnatak Soaps and Detergents Ltd., Margo of Culcutta Chemical Works, Dettol by Reckett and Coleman Ltd., Palmolive by Colgate Palmolive. We must make a special mention of Calcutta Chemical Works’ Aramusk man’s soap, HLL’s Le sancy long-lasting.

Based on positioning, printing these brands are classed successful or failures. Successful brands are Cinthol, Dettol, Hamam, Jai, Lifebuoy, Lifebuoy Plus, Liril, Lux, Lux international, Margo Mysore Sandals, Nirma Beauty, Pears, Rexona, Santoor; the failure brands are Aramusk, Breeze, Camay, Crowing Glory, Ganga, Le Sancy, Nirma bath, OK bath, Palmolive, Ponds, Protex, and others.

4. Tooth Pastes:
The size of tooth paste market is 55,000 tons. The players are Colgate HLL, Geoffrey Manners, Balsara Hygiene Products Vicco Laboratories—TOMCO, Ponds, Latest Nirma Chemical Works and Anchor Brands of Colgate are white creams, Colgate Gel, Calciguard, Total.

Hindustan Lever Limited products are close up. Signals Pepsodent, Gel Versions Balsalras brands are Promise and Babool, Prize Geoffrey Manners Forehans, Viccos-Vicco- Vajradanti. TOMCOS Efferent, Ponds of India Ponds, anchor is a diversification of electrical unit.

The success or failure is based on market growth rate, pricing, positioning and packing. The successful brands are close up, Colgate Dental Cream, Colgate Gel, Pepsodent; Babool and Miswak can do well.

The failures are Cibaca, Forhans, Nirma, Ponds, Prize, Promise, Promise JFK (Just for Kids) failed, Signal, Vajradanti and Anchor is are get to make debut.

Brand Equity:

What is Brand Equity?

Several attempts have been made to define the phrase ‘brand equity’. It has different connotations when different people use it. That is ‘brand equity’ as a concept is differently defined from different point of view.

So one can ask many questions as he thinks fit. Is a brand equity the price at which a brand can be sold by an organisation to another? In that sense, it becomes a purchase consideration.

Is it the price of a brand?

Under study when all brands in the market are forced to have equal share?

What measures brand equity?

Is it the awareness or the buying intention or a brand loyalty?

There is no our answer to this. The best thing is to the experts or consultants in the field.

“Brand Equity” refers to “a set of assets and liabilities linked to brand, its name and symbol that add to or subtract from the value provided by the product or service to a firm and or that firm’s competitions” as clearly defined by Professor David A.

Aaker in his article “Managing the Brand Equity Capitalizing on the Value of Brand Name” Free Press 1991-p. 15. In other words, brand equity provides (or negatively subtracted value to a firm in the form of price premium or trade leverage or competitive advantage.

The following chart clears the concept of “Brand Equity”:

 

The brand’s assets can be categorized into the five groups as listed by Professor David. A. Aakar namely:

(1) Brand loyalty
(2) Brand name awareness
(3) Brands perceived quality
(4) Brand association in addition to the perceived quality and
(5) Other proprietary brand assets like patents, trades marks, channel relationships.

Accordingly, Arthur Anderson Consultants developed an elaborate methodology to define the phrase ‘brand equity’. Based on their way of approach, the definitions of brand equity are COST based, PRICE based and CONSUMER based. The following is the chart that projects the concept of Brand Equity bases.


 It will not be out of place if one has the knowledge of each method for, it helps in having perfect knowledge of ‘Brand Equity”.