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BRAND MANAGEMENT XIBMS EXAM ANSWER | XIBMS MBA EXAM ANSWER SHEETS PROVID...
Brand
Management
N. B.: 1) Attempt all Four
case studies
2) All questions carry equal marks.
CASE-1.
DAIKIN AIRCONDITIONER
Circia 2001: A flashback to the US$ 4 million air-conditioner industry in India.
The new leaders in the Indian cooling market were the charismatic and international LG, Samsung and the all-American Carrier. The homegrown warriors (Voltas and Blue Star), with more than thirty years of local expertise, were attempting a spirited comeback. Not to forget the villains of the drama were the unorganized and unbranded sector with nearly 25% of the market.
The Government of India, with its adverse taxation policies (an excise duty of 32% and an import duty of 35%) nearly doubled the cost of any branded air-conditioner. And the ubiquitous Rain Gods that lashed the country, naturally mitigating the summer heat, ate away the potential sales.
In this action packed drama entered the Japanese novice, Daikin a premium split air conditioner. It was internationally known as a flawless, well-engineered product but it was unheard of, unproved and untried in India.
An additional factor that had to be kept in mind was the considerable price premium at which Daikin was pegged (more than 25%); this too in a market traditionally known for its frugality, and where for the most part, an air conditioner itself was a luxury. And here was a brand, which was not only marketing a “luxury” product but had the temerity to price it even higher than other brands, making the task of rationalizing the purchase so much more difficult for the consumer.
The challenge, therefore, was not only to create the consumer’s preference for this 12th brand of air-conditioner in the country, but also to actually cajole as much as 25% premium (over the rest of the category) out of him.
QUESTION: To
address this challenge, should it flash the “I am International” tag and hope
that this had enough appeal to lure him?
A number of big global brands like Ray-Ban, Kellogg’s and KFC had tried
this route without much success! Or, should it follow the International Daikin
doctrine of endorsement and say, “Daikin cools the Sony Headquarters” or
“Daikin cools the G8 summit”—a proposition that cued in the superiority of the
product drawback in both the routes was that the Indian consumer might just
turn around and say—“So what’s in it for me?”
So what should this first time campaign for a
new product launch do?
CASE STUDY-2
A SLIPPERY PROBLEM.
Let us return to the premium toilet soap market in India. Suppose research has discovered an emerging cluster of consumers—young, modern, well-to-do—who believe that a bath soap should have good-for-skin qualities, who even think well of traditional herbs like Neem, but would accept it only with much more pronounced cosmetic benefits in terms of perfume, lather, colour, shape, and packaging. Recall our discussion on Margo in the previous chapter.
Is it possible for a ‘dressed-up’ Margo to aim for the new position?
Can Margo make the jump from where it is (that is, the way it is perceived now) so as to occupy the preferred position of this new cluster? Would the present physical characteristics of Margo—dark-green colour, strong Neem perfume, squat shape—permit the brand to match the ideal point of this new cluster merely on the basis of some superficial feature-changes like new packaging and brilliant advertising?
QUESTION: If the brand manager were to make the gamble of trying to position Margo—with some physical changes—both for his present target segment and the new one, how successful would he be? On the other hand, suppose he decided to make radical changes to Margo, so as to greatly enhancing its cosmetic values, how would that affect his present loyal segment of users? Should he pause and recall that old saying---“Beware of greed and grow fat”? Would it be better to consider a new product altogether? A product whose physical features are specifically designed to fit the new position, and whose concept can be stated as:
A highly emollient
soap. Floral perfume with topnote of
Neem:
‘The creamy
Neem’. The benefit of pure, age-old neem
goodness without the drab looks of average neem soaps.
CASE STUDY-3
MOTORCYCLES
Another group os students set out to assess the fit between the images of motorcycles and the sled-concepts of their owners.
First, the student researchers made a fairly extensive study of the literature. They decided to replicate ( on a modest scale) the methodology developed by Naresh Malhotra to measure self-concepts, product-concepts and person-concepts. Since Malhotra’s study(in the USA) involved automobiles, his scaling method seemed to them to be appropriate.
Using, with minor modifications, the 15 scale items developed by Malhotra, the IIMC students administered a questionnaire to 40 owners of 100 cc motorcycles: 15 were owners of Hero-Honda; 15 of Escorts-Yamaha; and the remaining 10 of TVS-Suzuki. All the respondents were within 18-40 years of age, well-educated, urban and middle class males.
There were questions also on the perceived physical attributes and functional benefits of the three machines.
When the findings were put on graphs, it appeared that Escorts-Yamaha showed the closest fit between brand image and self-concept ot the owners. The students were conscious of the limitations of their survey, including the small sample size and other problems of methodology. But even if their findings are regarded as a pilot study and merely indicative, they may provoke the search for more data. We have reported here in summary, this is what they found regarding the brands, the brand personalities and self-concepts of the owners.
The TVS Suzuki advertisements has positioned itself by attributes which are similar to those claimed by Hero-Honda and it has positioned itself directly against the latter. Thus, TVS-Suzuki is apparently talking to a segment whose self-concept has moved it towards Hero-Honda. The battle is one of degree—‘more’ economical, ‘greater’ cost-saving.
QUESTION: Would it be
better for TVS-Suzuki to position itself on the strength of a unique
personality—one that is distinct from the somewhat flamboyant, vain personality
of Escorts-Yamaha and also distinct from the thrifty, almost parsimonious
character of Hero-Honda?
CASE-4
HIGH RISK GAME
But beware!
According to an Ernst and Young survey in 1998, fully 72% of brand extensions flop. The explanation seems to be that the extension did not add anything new or better to attract consumers. As the Harvard Business Review had pointed out, extensions are more a sign of the marketer’s desperation than inventiveness.
QUESTION: If you have
a promising product idea should it carry the mother brand’s name or a new one?