Is brand Kingfisher in trouble?

By Ashwini Gangal , afaqs!, Mumbai | In Marketing | December 08, 2011
How will the controversy around Kingfisher Airlines impact the larger brand Kingfisher and its parent brand the UB Group? afaqs! fetches some answers.

Kingfisher Airlines has been in the news lately due to a host of business-related problems. Revenue and business problems aside, the negative coverage must have affected the brand as well - in this case, multiple products are at stake.

The brand 'Kingfisher' has primarily been a beer brand which was later extended to the airline sector. In fact, Kingfisher in the last few years, has turned out to be the flagship brand for the UB (United Breweries) Group. Truly, brand extensions certainly have its advantages, but there can be some adversities, too. So, how has this affected both the brand Kingfisher and the parent brand UB?

Broadly speaking, two schools of thought exist on the matter. One feels that the business problems that the airline is facing will have little or no rub-off on the UB Group, or on any of its other product lines. After all, the imagery and perceptions associated with each brand/product are all very different.

The other school of thought is of the opinion that the problems faced by the airline will indeed sabotage the image of the larger Kingfisher brand, particularly the liquor business, and ultimately, the parent brand UB. After all, it's all one family and the negative halo effect will encompass one and all.

afaqs! explores both perspectives.

Brand Kingfisher is safe

According to Kiran Khalap, co-founder, Chlorophyll, the parent brand UB is immune to the issues that plague the airline brand. "The UB Group is well-protected from Kingfisher Airlines' problems," he says.

Elaborating on that, Khalap says, "I think, the UB Group is fairly opaque, and the link between Kingfisher and the UB Group is not very strong, and the common man is not exposed to it. There is a lot of padding between the two, so the heat from Kingfisher Airlines will not touch the parent brand."

But, will not brand Kingfisher be adversely affected? Brand Kingfisher, Khalap feels, is led by the beer part of the business, not the airline. "It has the most skilful use of sonic branding in a predominantly 'oral' country like India - it has used the tune (Oh la la la la Ole O...) very well to create greater and greater brand memorability (recall) and recognition. Thus, Kingfisher, the beer brand will not be affected by Kingfisher, the airline brand," elaborates Khalap.

According to Minakshi Achan, co-founder, Salt Brand Solutions, there has been some impact on the Kingfisher imagery. "Certainly, an interruption in the service of Kingfisher Red has thrown passengers into a tizzy and has earned it a certain reputation in recent times which just has to be managed," she says.

Having said that, she is quick to add, "But, I don't think the beer brand is affected at all. It's a different line of business, and has a large and loyal consumer base. Not just that, it's been India's best-selling beer for years, long before Kingfisher extended its franchise to the airline," she says. She also sees no adverse impact on the parent brand UB as it has a wide portfolio of successful brands which are market leaders.

Digressing from the subject, Achan goes on to explain that Kingfisher Airlines has inadvertently brought the ailments and pressures of the airline sector as a whole, in the limelight. Most airlines have the same problems and are debt-ridden; the problems aren't confined to Kingfisher, she argues.

Arvind Sharma, chief executive officer and chairperson, Leo Burnett India, is optimistic. "I don't think the difficulties the airline is facing will have much of an impact on the Kingfisher brand. There is no beer in the market that's as big as Kingfisher. Moreover, the airline has already done the beer brand a lot of good -- it has given the brand a stature that no other beer brand has in the country," he reasons.

Sharma feels that Kingfisher's airline business -- something that probably began as an image building exercise for the beer brand -- went on to become a business in its own right and though riddled with problems, will bounce back. About the UB Group, while admitting that potential employees may worry about joining the company, on the whole, the impact on the mother brand will be very marginal as the airline's problems are a negative minor in the larger scheme of things.

'King of Good Times' no more?

On the other end of the opinion-spectrum is Jitender Dabas. The senior vice-president and head, planning, McCann Erickson, opines that apart from beer, since Kingfisher is now also a big service brand, it is built on intangibles.

Overall, the brand DNA of Kingfisher is about a 'king-like' feeling and according to the brand promise of Kingfisher, you will 'have a good time'. This is a promise that is delivered through everything that Kingfisher has successfully done -- its beer, airlines, F1 team and even the calendars.

But this promise is rooted in hedonism - that is, the opulence and richness that the brand and its owner (Vijay Mallya) reflect. "As a consumer, I trust the band to give me good time because it has the money and riches to do that. So the fact that they don't have the money to run their business shakes the very foundation of this promise," he says.

"Will the consumer trust a 'cash-strapped' brand to give them a 'good time'? I don't think so," he exclaims, "If the problems last for long it will certainly have an impact on the brand."

He goes on to say that while the individual liquor brands in the UB portfolio will not be affected directly, as a brand, the UB Group draws its equity from the 'owner source', namely, Mallya. "Whatever happens to Kingfisher reflects on the owner, and in turn, comes back to reflect on the parent group," he says.

Ultimately, regardless of which school of thought is actually right, from a brand point of view, it's about whether the authorities can pull off some convincing image repair. Khalap predicts, "Public memory is short. If the Kingfisher team gets its act together, they will be able to bounce back and ride on the equity of the airline brand once again."

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