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    Module 6

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    1) An aspirational brand is one that defines not just the product but the person who buys and uses it. For consumers in Europe and the USA, brands like Rolex, Harley Davidson, and BMW are seen as aspirational. 2) Power brands have the most pulling power and growth potential. Companies focus resources and advertising on these brands and phase out underperforming brands. 3) In the low-technology FMCG market, entry barriers are low and product differentiation is also low, limiting opportunities for innovation. Smaller players use low pricing, effective distribution systems, and localized media to target local markets and gain market share from bigger players.

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    Module 6

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    79 views4 pages
    1) An aspirational brand is one that defines not just the product but the person who buys and uses it. For consumers in Europe and the USA, brands like Rolex, Harley Davidson, and BMW are seen as aspirational. 2) Power brands have the most pulling power and growth potential. Companies focus resources and advertising on these brands and phase out underperforming brands. 3) In the low-technology FMCG market, entry barriers are low and product differentiation is also low, limiting opportunities for innovation. Smaller players use low pricing, effective distribution systems, and localized media to target local markets and gain market share from bigger players.

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    1) An aspirational brand is one that defines not just the product but the person who buys and uses it. For consumers in Europe and the USA, brands like Rolex, Harley Davidson, and BMW are seen as aspirational. 2) Power brands have the most pulling power and growth potential. Companies focus resources and advertising on these brands and phase out underperforming brands. 3) In the low-technology FMCG market, entry barriers are low and product differentiation is also low, limiting opportunities for innovation. Smaller players use low pricing, effective distribution systems, and localized media to target local markets and gain market share from bigger players.

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    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    79 views4 pages

    Module 6

    Uploaded by

    welcome2jungle
    1) An aspirational brand is one that defines not just the product but the person who buys and uses it. For consumers in Europe and the USA, brands like Rolex, Harley Davidson, and BMW are seen as aspirational. 2) Power brands have the most pulling power and growth potential. Companies focus resources and advertising on these brands and phase out underperforming brands. 3) In the low-technology FMCG market, entry barriers are low and product differentiation is also low, limiting opportunities for innovation. Smaller players use low pricing, effective distribution systems, and localized media to target local markets and gain market share from bigger players.

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    MODULE 6

    Aspirational Brands

    An aspirational brand is a brand which not only defines the product. It also
    defines the person who owns buys and uses that brand. For consumers in Europe or
    the USA, Rolex, Harley Davidson, Moët & Chandon and BMW are probably
    aspirational brands. Nescafé,Walmart and Ford may have many loyal customers
    but they are aspirational brands which define the owner.For consumer in india

    Power Brands

    Power brands include those brands which have the maximum pulling power
    and growth potential. These brands become the pampered child and beget all the
    attention in terms of promotion and advertising. All the other underperformers are
    left to languish, to be ultimately phased out. The logic is simple, focus your
    resource and attention to the few in hand and ?get rid of the brands that are going
    nowhere and draining funds from the brands with high potential.

    CHARACTERISTICS:

    Low technology market

    Most of the FMCG companies are operating in a low technology market.


    This makes the entry barrier quite low. This also results in low product
    differentiation. Thus product innovation doesn?t offer that kind of opportunity to
    strengthen the hold over the market.

    1 Dual “C”, BIMM 07-09


    Pricing

    most of the small players banking on the factor of low pricing to gain
    foothold over the market, bigger players have little hope of adopting this strategy
    due to higher overheads. On the contrary smaller players have an edge over the
    biggies and have been in fact using this very ploy to grab their market share e.g.
    the onslaught of the Nirmas on the Levers in the 80?s with a low cost business
    model.

    Distribution

    On this front too, the giants are losing out. Availability can be ensured
    through a cost effective wholesale channel. With the smaller players looking at a
    smaller market, it doesn?t cost much to create an effective distribution system.
    Also lower overheads offer a greater freedom on the pricing arena. This enables
    them to push the product more forcefully by offering higher margins to the trade.

    Localized media option

    With the fragmentation of the media, more options are available to target the
    local Market. These options are being used by the smaller players to create local
    brand awareness at a cheaper cost. Once the critical mass is achieved, these players
    can spread their focus to a wider area.

    Increase in competition spawned rampant promotion Shift to promotion


    from theme advertisements was the most cost effective way to lure the customers,
    loyal to the other popular brand. This also made the products more prices
    competitive. However for the established players this was a costly game adding to
    the strain of the already decreasing margins. These tactics also resulted in thinning

    2 Dual “C”, BIMM 07-09


    brand loyalties. With the slow growth in the FMCG sector there is a kind of zero-
    sum game: any gain by the competitor is at the other?s expense. Thus cost and
    competition acts as drivers.

    The fragmented media, the high advertising cost and competitive pressures
    from regional branded players, leave little options for the larger player but to
    leverage its scale. This is crucial in a crowded market where 3000 advertisements
    are seen on television every month and where the number of SKUs stocked by
    retailers has gone up by about 40% in last three years.

    The benefits of rationalizing the portfolio are two-fold: one, it enables a


    company to refocus the marketing budget into brands where the money invested
    yields a greater value. And two, you save in terms of the opportunity cost when the
    sales and promotional efforts are withdrawn from weaker brands.

    Strategy

    Focus on the few: Brands are identified based on the criteria such as absolute size,
    brand equity, brand relevance, competitive strength and potential for growth and
    full support in form of financial and human resources. Thus optimization of
    resources is of paramount importance.

    Extend the brand to include new products: If the growth of the core brand is
    ensured, it becomes viable for extension. More of the other products and even
    services can be introduced whose line of application enjoys a synergy with the
    positioning sustained by the core brand. The concept is akin to that of umbrella
    branding. E.g. extension of Lifebuoy to talcum and that of Fair& Lovely skin
    creams in soaps.

    3 Dual “C”, BIMM 07-09


    Migrate potentials: If the non-power brand is of significant size and has the core
    proposition of a power brand, migrate it into the power brand. E.g. Coco Care into
    Nihar.

    Exit from lackluster brands: Brands with no future will be gradually phased out.
    Business which is not aligned with the core portfolio and which would require
    greater investment may be hived off. E.g. Non-FMCG business may be hived off
    by FMCG groups.

    Cult Brands: - A cult brand will have loyal customers,they all form a
    group(people having same interests).cult branders aren't just selling a product or a
    service; they are selling the opportunity to fulfil their customers' passions, dreams,
    and aspirations.

    BRAND IDENTITY:

    An identity that communicates beyond the product, so that you can leverage that
    name to other things, and it has some of the same meaning.

    Customers value some of the most powerful brands in the world primarily for
    their "cultural value": They provide imaginative resources that people use to build
    their identities.

    "The most powerful brands are those that are able to traverse disruptive
    cultural shifts. Many brands falter when disruptions hit. The most impressive
    brands are those that are able to use disruptions as a platform to enhance the
    delivery of cultural value."

    4 Dual “C”, BIMM 07-09

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