Surina Sayal
Marketing

World Brand Congress 2010: "Brands are one part logic, but many parts magic," says D Shivakumar

Nokia's Shivakumar shared insights on why brands die, why companies kill certain brands; and also his projection of the future of media and brands in the country.

In the second half of day two at the annual World Brand Congress 2010 in Mumbai, D Shivakumar, vice-president and managing director, mobile phone, Nokia India discussed how brands don't age, but need to be revitalized.

"Brands can age and be timeless, or age and wither away. You can take a 100-year-old brand and make it look young and fresh like a 10-year-old one, or vice versa. Age really has nothing to do with it," he said.

World Brand Congress 2010: "Brands are one part logic, but many parts magic," says D Shivakumar
He went on to cite reasons for why brands die. One of these is that brands tend to get locked into a product format and refuse to budge, for example, Dalda Ghee and Milkmaid condensed milk. The opposite of this is where brands have grown, such as Vaseline, which was originally petroleum jelly, but later extended its offering to skin-care products, taking forward its proposition of "providing skin care". Dove did the same when it expanded its product line from soaps to hair care, shampoos and conditioners, leveraging its USP of "one-fourth moisturising milk".

Another reason for the death of brands is that they tend to lose focus and try to mean too many things to too many people. For instance, Pierre Cardin was successful in the '70s, but went on to launch fragrances, jumpers, jackets, shades, pens and many other items, creating absolute confusion and resulting in the original brand losing focus.

World Brand Congress 2010: "Brands are one part logic, but many parts magic," says D Shivakumar
A third reason is that a brand does not keep pace with technology, a case in point being Kodak, which did not immediately move into digital cameras; but chose to stay put with chemical rolls, because that is where it made money.

Losing consumer connect and remaining untouched by innovation were also reasons he cited for brands meeting their end. Brands such as HMT Watches, Air India and the Ambassador car have not innovated at all; so much so that far from embracing the brand, consumers would shy away from being associated with it.

Being acquired by another company could kill a brand, as could getting on the wrong side of the law, for example, Enron Corp. Unforeseen religious issues is also a key reason why a brand could die.

Shivakumar also shed light on why companies kill brands. This usually happens if there are too many brands under one company, example being auto brands such as Saturn and Hummer.

Another reason could be overlapping brands, where the company has the money to back only one brand. Similarly, a fighter brand that has played its role could be killed, as was done with British Airways' lost cost airline, Go!. It was launched to tackle competition from Ryanair, and was then killed.

A new fad called "brand migration" is also how brands are killed. Here, companies hope loyalties will shift to another sub-brand, as was done in the case of Hamam and Lux. But this has only a 2 per cent chance of success, opined Shivakumar.

A brand could be killed after a merger or acquisition, as was done to Ganga soap after a takeover by Godrej. "Most often, it is dogmatic thinking in companies that kills brands -- where companies think, 'it's either my way or the highway'. Therefore, arrogant leadership and a company unwilling to learn and unlearn everyday spells doom."

Shivakumar went on to discuss the changes he foresees in India -- changing consumers, a changing society and changing competition. As incomes have risen, spends on food have gone down, while they have increased in communication and transportation. He thinks that spends will go up in health and education over the next few years.

"Media has changed tremendously; nowhere in the world have news channels played entertainment the way they do in India." Icons have also changed over the years too, moving beyond a handful of film and cricket stars to include many more sportspersons and youth icons.

Foreign direct investment in India has gone up from $4-5 million five years ago to $40-50 million today, a ten-fold increase. This suggests that there will be more employment opportunities. New technologies and new people will come in, and along with that, more competition from around the globe.

Thus, a brand can't afford to only aspire to be the best in the country; but must be the best in the world, where competition is on a global platform. Brands will have to maintain consistency, yet evolve to stay fresh -- logos will evolve; design and packaging has to evolve.

Shivakumar also foresees that India is going to be younger, but richer. "In 2020, the average Indian age will be 29; while in China and the US, it will be 37 and in Japan, 48. Therefore, youth is not a segment anymore; it is mainstream. A brand has to appeal to them first," said Shivakumar.

Shivakumar thinks there will be faster cycle times for products; and sensory will become bigger, such as fragrances in detergents. The total consumer experience will count, as in the case of coffee shops, where "experience" drives the category. Also, he added, India allows experiments with business models; and people should take advantage of that.

Dishing out some pointers for brands, Shivakumar pointed out, "Brands are one part logic, but many parts magic. We tend to get too rational, but we have to realise that emotions are far more important."

A brand also has to look at itself and see if it is consumer-decided or consumer-driven -- that is, not going exactly by what a brand hears from consumers, but using some intuition.

Shivakumar also questioned marketers on whether their organisations show the "DRIP (data rich, insights poor) syndrome" -- where a roomful of data can be obtained, but the right insights are not sought from this.

He concluded by saying opportunities today are huge; the chances to succeed are immense; but so are the chances to fail.

Have news to share? Write to us atnewsteam@afaqs.com