By P.M.Sinha

Brands will continue to be the biggest property and wealth of companies, and certainly more so in this, the 21st Century. They will continue to be vehicles for creating awareness and offering choice. What will change rapidly, however, are the levels of awareness and the dimensions of choice. The rate of acceleration will be so high that, increasingly, the past will no more be an indicator of the future. While this change can be attributed to technology, there are several other barriers-geography, affiliation, tradition, generation, and values-that will be re-defined by a voraciously communicating society. Brands will have to adapt and participate in this change. And those brands that anticipate these changes early shall profit disproportionately.

There will be an increasing convergence of organisational and brand wealth. Brand equity will emerge as the true measure of the asset-base of an organisation, and will signal a key shift from cold financials to the management of creativity and innovation. This is a people-centric transformation that will have ramifications on how the organisation of the future is to be managed.

PRODUCT PERFORMANCE TO BRAND EXPERIENCE. The most obvious shift will be the demise of the USP (Unique Selling Proposition). The USP will live, but never long enough to squeeze returns out of business propositions founded on new-age products or ideas. The emulation curve will be steeper than the traditional PLC (Product Life Cycle), thereby diminishing the value of USP-led branding. In such a context, brands will be defined less by their attributes, and more by the attitudes and lifestyles of the associated target consumer groups. There will be a shift from brand performance to the entire experience surrounding the brand.

LOWER BRAND PREMIUMS. Brand-building will need to operate over a horizon of several years. As entry costs escalate with large investments in brand-development, brand-perspectives will require careful and assiduous nurturing and maintenance. Stores will not wish to block money; and will stock between 3 and 5 viable brands in any broad product or benefit category, even in somewhat less-integrated and developing markets such as ours. Higher entry-costs and a lower sustainable brand premium will necessitate a relentless focus on costs and operational efficiencies. Manufacturing will be economies-of-scale led. And as the core skills required for brand-building and manufacturing are different, the owners of the brand and the production facility will, increasingly, be different, leading to more franchise business or co-packing arrangements.

Gone will be the days of relatively easy line extensions and variant-ing. More choice will not necessarily mean more sales. A proliferation of SKU's (Stock Keeping Units) will result in additional manufacturing and channel costs. Short-term blips in sales volumes caused by these SKUs will rarely justify these. The focus of the sales strategy will shift from price to product to value. Pricing power will, increasingly, be supplanted by brand power; and even promotions will graduate from the realms of tactical sales-boosters to become vehicles that enhance the brand image.

STRENGTHENING THE CUSTOMER CONNECT. Companies will acquire the capability to monitor sales in great detail, and in real time. This will encourage the development of meaningful, infotech-led measures of consumer behaviour. Simplistic brand-share definitions will change, and the focus will shift from numbers to value, profits, and revenue-streams. Concepts such as share of mind, share of youth trends, share of stomach, and share of lifestyle will replace simplistic demographic mapping.

The brand's connect with the consumer will take several forms. At one end of the spectrum will be the mass appeal, universal, iconic, almost cult-status brand. The other extreme would be the highly-niched brand that no one else other than the narrow target group even needs to know about. This brand-as-badge imagery shall develop as consumers see their values reflected in the brands they adopt and, in turn, embrace the values that the brand espouses.

Such initiatives are likely to lead to a convergence of brand ideologies amongst sets of brands. Co-branding, cross-promos, and other such associations will leverage the strengths of disparate companies that have strong target group commonalties. Such efforts, in tandem with the Web revolution, shall create experience communities leading to collaborative experience-sharing, thus providing an entirely new and powerful dimension to the strength of word of mouth.

As everything gets connected, especially on the Web, the consumer would have much more power to access information than that provided traditionally by advertising. The era of brands largely developed on successful advertising platforms may give way to other multi-dimensional and multi-media led approaches.

NEW TECHNIQUES, BETTER MANAGEMENT. The 21st Century is likely to become the exclusive preserve of the few strongly marketed brands that succeed in creating an intense relationship with customers. Every new management technique and philosophy will need to be justified on the basis of how it serves to improve the company's relationship with its customers. Companies and organisations will be identified by their stable of brands. All employees will need to feel passionately about the their company's brands, and be willing to assume ownership for the servicing requirements of a demanding and well-informed public. The information revolution will play a crucial role in endowing companies with an ability to strategically micro-manage the brand environment.

Speed and adaptability shall be the winning strategies. Organisations with a vision will surge forward; creating truly global brands built on the opportunities created by borderless commerce. If branding is all about making and delivering on a series of promises, organisations will need to be structured and focused around developing the capabilities required. While the intellectual and analytical capabilities of individuals will be stressed as never before, the imperatives will shift to team-performance. This will call for top-quality motivational leadership that obtains performance through inspiration-not monitoring. People, their passion, their ability to leverage each other's mind, and strength, and the combined commitment of a team will determine brand success, and the success of a company in a globalised, liberal, barrierless business environment.

P.M. Sinha is the CEO of Pepsico India

Issue Contents  Write to us   Subscriptions   Syndication 

INDIA TODAY |  INDIA TODAY PLUS | COMPUTERS TODAY
TEENS TODAY | NEWS TODAY | MUSIC TODAY | ART TODAY

© Living Media India Ltd