Views

A Purpose-Bred Roadmap

Having followed their businesses for long, will the Indian Brands learn to lead their businesses?

Making the business case for building global brands

Historically businesses led brands. There was a business strategy to begin with, a business model followed by functional strategies – HR, sourcing, manufacturing, R&D, distribution, sales, marketing and so on. Somewhere within marketing as communication and alongside Brand. Investments were made to set up and run the functions and also into marcom including brand. The latter naturally being a luxury considered and afforded by businesses that could indulge in it and had the progressiveness and patience to experiment.

Brand was seen as an overhead. An expression side element left to the marketing department and contributed to by creative and media agents. People who enthusiastically extolled its virtues but could never prove its value. Indeed, for anything to be of consequence in business, its materiality needs to be clear and measurable. Since no one could achieve the analytical depth for isolating and measuring the economic impact of brands, it was always convenient to keep it with the subjective softer aspects of business like advertising and design.

At Interbrand, we have strived fiercely all around the world to dispel this paradigm. To take the brand out of the confining preserve of marketing and to place it in the center of the organization. This we believe creates business value at four levels – structural optimization, internal & external engagement, demand generation, premium & sustenance, online & offline experience.

  1. Value creation through structural optimization

One invests to set up and manage the various functional aspects of the business anyway. Wouldn’t simple principles of synergy and cohesion make it more efficient if we could somehow integrate the functional strategies though an organizing principle? And what would be better than using the Brand itself as organising principle?

That’s the first way in which Brands create business value.

  1. Value creation through internal & external engagement

There are two kinds of organizations – business driven and purpose driven. The very act of leveraging brand as the central organizing principle creates a fundamental shift for the organization – a shift from being purely business driven to purpose driven.

Employee Engagement Employee Loyalty Customer satisfaction Employee Productivity Quality of customer experience Customer loyalty Revenue/Profit Growth

The purposefulness of the organization then becomes the premise for a stronger employee engagement. McKinsey’s Service Profit Chain model describes the rationale behind it succinctly. Organizations with stronger internal engagement have been conclusively proven to deliver superior financial fundamentals.

  1. Value creation through demand generation, premium & sustenance

The third way through which brands create business value is the basis of brand definition itself. Any business will do well by way of three simple factors – demand generation, demand sustenance and ability to charge premium.

So how does a brand centric approach at organizations help do this? The demand generation in any business or category as also its premium is a function of how strongly does the business own the important drivers influencing the purchase. The sustenance of demand is decided by the strength of the brand internally and externally.

This is the basic approach employed for strategic positioning and definition for the best global brands.

  1. Value creation through portfolio organization and management

How do we decide on the number of products or categories a brand can straddle? Many Indian organizations today have organically grown into a proliferated portfolio situation. For most, the new product or service opportunities over a period of time either found the same brand cover or a new name. Neither was there a destination envisaged strategically basis nor was there a long term naming system to ensure an organization of the rapid additions to the spectrum.

This understandably dilutes the impact of the brand by confusing the orientation and the ownership of a sharp demand driver as well as weakening many brand strength factors like clarity, focused innovations, authenticity, consistency and understanding.

By a brand centric portfolio management, it is possible to build a portfolio bottom up via the synergies in the demand drivers across the categories. This helps clearly decide on the extendability of the brand and the real need for additional primary and secondary brands. This also ensures that the brand strength does not get compromised but instead gets reinforced through the portfolio.

  1. Value creation through online and offline experience

From structural to premiumized demand generation and sustenance to portfolio organization, we have seen the central and undisputed role of brand in creating both common sensical and measurable business value. Finally let’s conclude with the value creation role of brand at the expression and experience stage.

Experience is a sum total of all the touch points that the business has across its stakeholders, both internal and external, offline and online.

And the touch points of experience are not limited to communication alone as majority in the Indian market tend to believe. The touch points include product and service experiences, the beahvior of staff, the channel experience and digital, internal and external communications.

portfolio with a synergistic brands themselves?

A large number of these touch points across Indian businesses do not follow a converged theme. Wouldn’t it be efficient and productive if there was one? Again, can there be a better basis for effecting this convergence than

If we open up our minds beyond the business and financial processes at one end or communication levers at the other, we will see the vast opportunities that connect the two in between. Unfortunately the practitioners of these two ends of the spectrum prefer to keep it disjointed to hide their inabilities to straddle them.

“Investing in your brand is not just a nice ‘extra.’ Brand change can deliver significant returns, boosting both perception and your bottom line—but it has to be done right.”

How Interbrand approaches business case development

By consulting with experts who have the strategic and analytical capabilities to deliver maximum business impact plus the insight, talent, and diverse range of skills required to make the business case and then execute a winning creative strategy, organizations can leverage the power of their brands to deliver real business impact.

Hope we can do that for the Best Indian Brands.

Contributors

Managing Director, India