The event hosted on 14 August featured a panel comprised of Rajeev Batra, Sebastian S. Kresge professor of marketing and director of Yaffe Center for Persuasive Communication; Ramesh Thomas, president and chief knowledge officer, Equitor Value Advisory; and Ravi Dhariwal, CEO - publishing, Bennett Coleman and Company.
The session was opened by Kiran Khalap, founder, Chlorophyll. At a time when 90 per cent of new brands die within five years of being created, he credited ‘rapid innovation as response to change’ as the reason for why Chlorophyll had survived.
Anand Halve, co-founder, Chlorophyll, introduced the panellists and provided a background to the subject of discussion.
He stated, “In times gone by, there was a clear difference between product brands and corporate brands. Product brands were the entities that the customer dealt with. Corporate brand was the entity that stock analysts and investors dealt with. But as the world grows more transparent and the customer becomes aware of the corporate entity and investors become aware of what the product is doing, the walls between corporate and product brands begin to break down. When this happens it is important to understand what is at the core that defines this entity itself and that becomes a guiding principle for everything a company does. This implies that brand management is far too important to be left to brand managers.”
Corporate brand versus the product brand
Halve, who moderated the discussion, invited Rajeev Batra to shed light on the context.
Batra responded, “With the transparency that we have on web with social media and so on, people now know so much more about brands that companies and brands need to be as honest as possible. Given the role of employer branding, you need to build a strong corporate brand. In most businesses, it is important to obtain and retain the finest talent and for those purposes you need a very strong corporate brand.”
He added, “Having spoken to people at Mahindra very recently, (I found that) the employees are very genuinely enthused with the idea of ‘Rise’. Having said that, there are situations where corporate branding is more important but there are also situations where it is less important.”
Batra went on to list instances where it made sense to invest in corporate branding:
1. When it helps in cross-selling
2. When product category or culture or target segment is one where perceived risk of purchase and failure is high, consumers look for constant reassurance of a trusted corporate brand
3. Culture and knowledge:
a. Industry has been for decades emphasising on the corporate brand in advertising in Japan or Korea or China, because in those cultures people look to the corporate brand for reassurance
b. If the consumer is knowledgeable regarding a product they don’t need the corporate brand as much; but if one is less knowledgeable one needs the corporate brand for reassurance
4. When a consumer segment cares so much about a certain social issue, they make brand choices based on how a company acts on that issue
5. When what the corporate brand stands for or what it means will help expand into a new product category
6. When corporate reputation on honesty, authenticity and so on is relevant to the main business category
7. When the product itself is ‘terrific’ but there are other challenges (example, Target’s credit payment system not being trustworthy)
He went on to list instances where he would not endorse ‘moving money from product brand to corporate brand’:
1. When there are multiple consumer segments with different needs, one needs product brands
2. Danger of giving the corporate brand a meaning which is too broad, too abstract, too bland – with no real impact on purchase decisions
3.Meaning being less relevant and motivating to a specific product category
4. Danger that the corporate brand position is simply ‘not acceptable’
‘The Times Group’ brand
Halve went on to quiz Dhariwal on Bennett Coleman being less familiar and/or known when in comparison to The Times Group or even The Times of India, and how that plays out for the media brand.
Dhariwal said, “Bennett Coleman doesn’t have consumer value whereas The Times of India clearly has customer and consumer value. The Times of India stands for something to a reader and when we realised some years ago that The Times of India is what we are known for we started thinking about creating a parent or umbrella entity which was distinct from Bennett Coleman.”
“The Times of India stands for India, it stands for everything you want to know about India, as we say – ‘A day in the life of India’. We searched for a parent entity and we hit upon The Times Group. Times Group has come to have a better connect with our readers and advertisers,” he added.
Dhariwal cautioned that the process doesn’t stop at creating a parent entity. A brand or company needs to figure out what it stands for, he said, adding that Bennett Coleman figured that the first thing it stands for is ‘trustworthiness and credibility’.
“We realised we need to shape the parent based on what the child is. We figured out that we want to be absolutely neutral. We leave each of our editors to determine what line to take. So you would find that while The Times of India goes on talking about peace with Pakistan, on the same day Arnab (Goswami) is hammering away at Nawaz Sharif and Pakistan. That is the only way to build credibility. We have a very federal system whereby we are very careful in what editors we select and we give them total independence. We give our editors total freedom and tell them to not break the law and to not secede from the union. In whatever we do, we are going to ultimately serve our consumers. Creating a parent has allowed us to define our values beyond just The Times of India. It has helped us create a path for ourselves, which I think would not have been possible if we had remained Bennett Coleman,” Dhariwal explained.
Drawing from brand equity
Tata, the corporate brand, lends its equity to plenty of product categories it is present in. The degrees with which these categories draw upon the equity varies. Setting this context, Halve brought into the discussion Ramesh Thomas, who has led strategic valuation of the Tata brand in the past.
Thomas explained the basic concept at work whenever one tries to draw from a brand’s corporate identity. He said, “It will be good to have a working definition of when the brand becomes an asset. It is when it can enable demand on the supply side or the customer side. On the supply side you can actually get better vendors or faster capital which creates value. On the demand side, it brings in customers quicker at a better rate. So on both sides, you can have value coming from an asset which generates demand faster.”
To build a corporate brand
Batra noted that the starting point to creating a brand is to clearly define what the brand wants to be known for. He substantiated, “If it is the quality of decency and paying on time then it’s the actual act of paying on time that will help your brand. In case of B2B companies, they are trying to build a reputation for innovation. Advertising for this is through creating thought leadership by co-branding, creating white papers, holding seminars and events and so on. Companies like IBM and Intel are trying to build up their reputation for innovation. The (conventional) ad budget is a small part of it.”
Halve asked Dhariwal about the role that non-advertising events play in creating and/or building the Times Group brand.
Dhariwal responded, “Sometimes, we believe that we need to create news and we do that by hosting events such as the Bombay Times party or the media awards; these are just occasions whereby we celebrate our consumers so I wouldn’t pay too much emphasis on them. There are other things that we do that create substance and are relevant. For example, the Lead India initiative through which we tried to bring in a sense of political awakening within the public. We also realised that readers have an innate need to give back to society. Hence, Teach India was initiated. The program that I’m personally proud of is Aman Ki Asha which was during the aftermath of 9/11. We felt that changed attitudes on both sides. Sometimes we owe it to our customers to engage with them and sometimes we need to define the agenda.”
Innovation, social media and leveraging equity
On the need felt by brands to always include ‘innovation’ as part of their strategy and its role with the corporate brand, Thomas noted that one of the most powerful aspects of corporate branding is the ‘ability to incubate’.
“When businesses want to get into new spaces, we find that the ability of the corporate brand to support that - either by way of raising capital or getting in to new geographies or finding new business partners or creating distribution. Anything that will incubate a business is very largely engendered by the business of the corporate brand. It may not sound very glamorous, but your entry ticket into having innovation is the fact that you have a strong corporate brand.”
Batra addressed a concern raised by one of the audience members regarding the importance attributed to social media in helping create a brand image. He said, “The broader conversation is the recognition that it is all forms of conversations that shape a brand. The brand in someone’s mind is shaped by different kinds of communications, part of which is social media, traditional media and so on. But the product is always at the centre.”
Thomas added, “Social media interrogates the substance of the provider. The moment that interrogation is ‘out there’, corporate reputation becomes almost as important as product reputation.”
For Indian brands trying to enter a new market in a foreign land, Batra offered a word of advice: “The number one challenge if you’re a company from India or China is the reputation for poor quality. You gain by linking your brand to some other brand with a higher quality reputation. So when you are the weaker entity, you have to build on the image or equity of another and only later think about running an event yourself.”