By Ashish Mishra
“There is a set of Indian brands that will power its way into any ranking due to the sheer strength of the financials. These are the large organizations that are doing well as businesses. They have created brands based on their scale, capabilities, and sustained performance leading up to trust. These are brands that find themselves among the top brands in spite of a relatively lower focus on brand building.”
Fundamental Strategic Shifts for Indian Brands
With the growth era of a few decades, the recent slowdown notwithstanding, an encouraging number of Indian businesses have become global businesses. But none have become a global brand as of yet. Perhaps it is time to revisit our approach to branding.
Branding is not something that's to be done by designers or experts based on their intuition or experience. To satisfy the sensibilities of the boss or his wife. To look better than the competition. To sound cerebral in presentations. To be more creative in communication. Branding is not even only about the end consumer, or just about new identity, clever philosophy, and logic for all of it to come together in communication.
A brand has to evolve from a pool of all stakeholders, their needs, aspirations, shaped by insights and designed to evoke favorable reactions, to be relevant even in the environment of the future. As we begin our journey to correct the scenario of underleveraged Indian brands, we need to start looking at branding through a universally evolved perspective. Because brands can be local or global, but branding always has to be universal.
Before “Globalization of Brands” comes “Universalization of Branding.”
From Identification to Differentiation and Value
If you think of building or creating a brand, then it's often putting brick on brick, splattering cement, and raising an edifice to your specifications and needs. Beautiful though it might be for the present, it will require modifications and reconstruction to keep up with the future.
A better way to approach branding would be to see it as mining of hidden riches, unlocking buried value, or unleashing dormant potential. Simply put, branding is like tapping ground water or oil through wells, understanding the abundance and maximizing it through a brand. It is all about knowing precisely where and how to dig for it, and one of the more credible ways of doing it is through the science of Brand value. The diagnostics enabled though Brand valuation logically clarifies the areas of higher role of brand alongside key demand drivers as well as the relevant levers of brand strength in a competitive context. It thus helps strategic creation as well as continuation of demand.
At Interbrand we define a brand as a living business asset, which if managed well across all touchpoints, creates identification, differentiation, and economic value. As a nascent branding market, we have seen brands operate at the first level—that of identification, which is why branding in our market typically meant identity. However, after the exuberance of growth and market focus on the demand side, it is imperative that we now start leveraging brands for differentiation and value.
From Explosive Growth to Cathartic Slowdown, and Recognition of Brands as a Strategic Tool
Recognizing brand as a versatile strategic tool for business is a fundamental shift in thinking that Indian brands are beginning to make. This is in part driven by the lagged economic slowdown we have experienced in recent times. While the stupendous growth era of the last decade saw businesses expanding, adding brands, extending them, and launching new ones, the recent years have ushered in a period of assessment and organization for many. With the maturing of both the market as well as the demographic youthfulness, and the opportunities of newer models enabled by digital and the accountability of social media; the economy is in the process of a catharsis in many ways. Brands are slowly emerging as a strategic tool to navigate this catharsis.
It’s not surprising that a fair section of brands and sectors in the BIB top 30 are the ones who have begun to use this approach, albeit intuitively. Strategic branding is being deployed to realize global ambitions, to focus diversified businesses, to organize portfolios, to develop strategic engagement and experience, to create and manage brand-benefiting conversations, and to create relevance in this new social era. These form the new pivots of transformation or ‘Universalization of Branding’ in India, and are indeed positive trends.
From Global Businesses to Global Brands
There is a set of Indian brands that will power its way into any ranking due to the sheer strength of the financials. These are the large organizations that are doing well as businesses. They have created brands based on their scale, capabilities, and sustained performance leading up to trust. These are brands that find themselves among the top brands, in spite of a relatively lower focus on brand building. The question really is: could the same brands have done a lot better if they had shown a higher clarity and commitment towards investing and building their brands? Two specific observations may help understand this better:
1. As mentioned at the beginning, among this lot of Indian companies there are the ones that have done well and emerged as sizeable global businesses. A fair number of them also found themselves in the Fortune 500 rankings. So they clearly are global businesses. But can any of them be counted as a global brand?
2. If we look at the neighborhood of brands, alongside these mighty ones we also find much smaller businesses in terms of revenue or enterprise value. With such disparity in the business and brand values, are there instances of underleveraged brands?
From Diversified Businesses to Focused Masterbrands
Indian businesses that are large conglomerates today are characterized by highly diversified businesses. These businesses grew organically and somewhat unplanned as a response to the disparate opportunities over a period spanning decades. Most are still influenced by dynastic ownerships. While the achievements and successes of these businesses are beyond question, they often present particular challenges in terms of brand management.
The very success of these diversified businesses ultimately creates a complex and challenging environment for brand building and brand accelerating parts of the portfolios is not considered. The investment in the brand is through the higher revenue-generating businesses which, given the value-driven markets, are usually lower in the value chain. The lack of strategic brand building for these potentially powerful master brands worsens due to structural constraints. While business units have dedicated custodians of BU brands, the custodianship of the bigger asset, the master brand, is typically diffused.
Fortunately now, there are an increasing number of such conglomerates that are realizing the opportunity of using strategic branding for creating cohesion, efficiency, and value through organized portfolio architectures under strong master brands.
From Fads to Strategic—the Advent of the Post Digital Era
Mention the word “digital” and many marketers are immediately on their guard. Much of this caution comes from fear, or a belief that they don’t fully understand digital. In Interbrand’s 2011 marketplace survey, we found that 32 percent of brand professionals did not feel they had the ability to use digital applications and social media effectively.
In large part, this is due to the perception that digital is a toolkit for executing marketing campaigns. Seen through that lens, it is obviously a scary proposition for professionals not trained in digital tool development.
Digital is no longer a mere tool — it has become both an experience and a behavior, woven into the daily lives of consumers. Business and brands have never seen such a significant shift—encompassing changing business models, shortening value chains, and rich, interwoven brand experiences…to mention but a few. But at its heart, the digital revolution and the post-digital world that we now inhabit has always been about people and behavior. Understand people, understand their behavior; and the business and brand opportunities quickly present themselves.
Nowadays, it is impossible to develop an appropriate brand strategy without digital interactions having an intrinsic role. Digital has a key role to play in driving consumer choice, commanding premiums, and building loyalty—the primary ingredients of brand valuation and building brand value. A brand strategy that doesn’t take into account the changes brought about by the post-digital world is simply not fit for purpose in 2013 and beyond.
From Emperor’s New Clothes to World Changing Brands
To address the pent-up need for modernization, some Indian brands have attempted to course-correct themselves. Their recourse was rebranding. Not surprisingly, in the “new to branding” market of India, makeovers emerged as the latest marketing fashion. But embracing the new became a fad, not so much for its own good but more to dissociate oneself from the past.
But the opportunity for Indian brands is much greater. When the shape of national demography changes within a decade from “Bottom of the Pyramid” to “Middle of a Diamond,” millions of youthful aspirations bloom and society’s attitude and behavior changes. And along with those changes comes the opportunity for brands to anticipate the new needs and transform desire, involve stakeholders with a living and flexing expression, and evolve with the changing world. That’s the secret for creating world-changing brands.
Brands will increasingly be about opinions, partnerships, communities, and heart. Brand building would be less controlled and would be a function of being able to trigger and manage conversations around a brand and its advocacy. World-changing brands warrant resonant products, people, and behavior, as well as environments and internal and external communications.
Without that, the act of just changing clothes may only be cosmetic at best.