Normally, I
do not post immediate sequels to my blog posts. However, the comments of my
good friend and respected colleague, Dr Ganesh Nayak on my last week’s blog
post, “Products, Brands and the Firm: The Five Immutable Laws of Branding”,
Strategy Musings, February 16, 2014 (http://cbrao2008.blogspot.in/2014/02/products-brands-and-firm-five-immutable.html)
have set me thinking on the emotional facets of branding. I believe I should
not only clarify certain aspects of the previous blog post but also benefit
from Dr Nayak’s thoughts to cover certain additional aspects through this blog
post. As readers may recall, the previous blog post postulated that six
attributes of a product or service, functionality, reliability, durability,
maintainability, affordability and differentiability, result in sustainable
branding. Dr Nayak rightly commented that important as these points are, a
brand is beyond these points.
Dr Nayak
mentions that the many of the six points are tangible which a customer can
experience in many “me too” products as well. He points out that a premium
sedan such as Nissan Teana may have all the six features to a rational mind but
the said car as a brand may not be as powerful as BMW or Mercedes is. He
follows up that a brand is more of emotions, as a result of which the customer
does not think of critically evaluating the above six points in respect of a
product under the brand; the customer takes the presence of the factors
granted. He refers to Mont Blanc pen not necessarily scoring high on all the
six factors but customers willing to spend a fortune to acquire one. Acknowledging
the meaningful insights that Dr Ganesh Nayak brings but also reviewing Dr
Nayak’s points objectively, it is clear to me that Dr Nayak’s insights point to
the need to supplement my previous blog post by developing appropriate constructs for the emotive
aspects of branding.
Emotions and
loyalty
Emotions are
strong feelings, and are characterized by positive ones such as respect, love
and attachment, and negative ones such as anger, fear and hatred. Emotions are
considered to be independent of rational thought. An emotive act or product
causes people to feel strong emotions. A strong brand, without doubt, is based
on, and is capable of, evoking strong emotions. When Nokia decided to sell its
Lumia smart phone business several people responded more emotionally than
analytically; the emotions were feelings of sadness that it marked the end of a
historic Finnish brand, rather than feelings of optimism that a new owner with
deep pockets and an emerging mobile operating system would infuse new life. The
latter was probably based on negative emotions that Microsoft could not yet make
a success of computing devices and, in addition, a concern that Microsoft
Windows would never be an OS platform that can revive and ramp up Lumia.
Clearly, future is somewhat imperfectly but popularly prejudged on the basis of
emotions rather than rational thought.
At the same
time, in spite of Nokia trailing other firms and brands in product features and
customer acceptance, millions of Nokia handsets continue to be sold globally,
the reason being brand loyalty. Loyalty, as we know, is the quality of being
faithful in support of someone or something. Like emotions, loyalty is also not
necessarily based on rational thought but at the same time has necessarily a
history of the customer benefitting from the product or service in terms of the
six factors in the past. Emotions and loyalty reinforce or erode each other contextually.
The objective of all marketing generally, and advertising specifically, is to
cause positive emotions and build brand loyalty. That said, it is to be
realized that both emotions and loyalty cannot materialize in thin air, and on
the other hand require a record of past performance based on the postulated six
factors. This blog post postulates five
immutable laws of emotive brand loyalty to deepen the understanding of these
processes.
The first
law: An emotive brand is “product plus trust”
Certain
products and firms evoke trust; a belief and an assurance that they reflect
quality, dependability, goodness, service and ethics. The trust typically
develops from a firm and its products consistently scoring well on the six
attributes. Over time, successful firms and products get branded positively, or
negatively, predominantly on a singular dimension. For example, certain firms
and groups get known for ethical conduct. Certain others get known for
consistently high quality of its products. Certain service providers get known
for their timeliness while some others get negatively branded for their erratic
schedules. Consistent delivery on product attributes leads to brand equity and sustained
brand equity leads to brand loyalty. The leading and lagging brands of the
world have their instructive lessons on compliance to this law.
The second
law: Branding is "banking of emotions"
A firm has
to provide products of quality to be a player of any standing in an industry.
Yet, some firms and their products gain a higher level of customer trust within
an industry. This may be considered firm level aggregate branding. Once a firm
achieves collective superiority in all of its products, occasional or isolated setbacks
are taken in stride. For example, Toyota, the world’s leading manufacturer of
automobiles had, two years ago, a series of product recalls in one of the most
stringent markets of the world. Yet, the company could tide over the crisis
rather comfortably, and even achieve higher sales in the year after. Apart from
an unassailable reputation of quality, a humbled and focused response to
addressing the quality concerns protected the Toyota brand. Branding is like a
savings bank of emotions for the firm. The larger the account, the more secure
is its future.
The third
law: Firm branding is portable, product brand extendable
Firms which
are fortunate to develop brands tend to be anxious to leverage the success of
brands to drive success of new products. While doing so, firms tend to fritter
away the opportunity by an inadequate appreciation of scope and limits for
brand reformatting. As a principle, product branding can be extended in a
product family but not portable across products. Any attempted portability
across product lines could be suboptimal compared to develop distinctive
line-specific brands. For example, Samsung could extend its Galaxy brand to all
its smart phones but its porting to a camera lineup was not as successful. On
the other hand, a firm which has high firm level brand equity can port its
equity into new product lines. Conglomerates and firms with high brand equity are
well positioned to achieve this. New firms of Tata and Reliance groups as well
as new product lines of electronic giants are indicative of this.
The fourth
law: Low cost is never a high price for branding
Theories of
marketing teach us that features with underlay of technology and overlay of
luxury come with a price. Premium products demand higher price. That said,
price competitiveness of a product, the other five attributes remaining the
same, buys brand loyalty. A customer who prefers a Mercedes SUV to a Toyota
Innova (also an SUV) typically has such preferences based more on the
reputation of Mercedes as a luxury brand even if it is pricey. That said, the
same customer who prefers the Mercedes SUV may not prefer a Land Rover SUV,
despite Land Rover being better SUV brand because of the much higher price tag
that a Land Rover has (Rs 2.5 crore versus Rs 1 crore of Mercedes). The
practical application of the six attributes of functionality, reliability,
durability, maintainability, affordability and differentiability varies from
customer to customer based on the nature of the customer, the social and
economic demographics and the product itself. Apart from the customer’s own
preferences the overall social infrastructure influences brand acceptability.
The fifth
law: Brand loyalty takes the vision of the viewer
Brand
loyalty takes many forms. The reasons why a product, firm or brand commands
loyalty varies from customer to customer. For someone who understands the
entire spectrum of automobile industry, Toyota could be the most favored brand
for its innovative accomplishments in manufacturing management, and not
necessarily because of the quality of any particular model. For someone who
understands aseptic practices, a hospital that has state-of-the-art aseptic
practices could command respect while for many others the association of
topnotch medical consultants could be the decider. It is for this reason that
some brands, “super-brand” themselves to ensure higher brand loyalty. While
Aquafina and Kenley mineral (pure) water brands command brand loyalty for
purity, Evion and Himalayan evoke further connect with the emphasis on bottling
at source of Alpines or Himalayas as the case may be.
Emotional
connect
The relationship
between a seller (the firm) and a buyer (the customer) is neither a selling
relationship nor a purchasing relationship; it is one of human relationship. In
an organization, for example, people may deliver on performance and may get rewarded in terms
of compensation, and teams may share bonuses amongst the members; however,
unless there is an emotional connect or an empathetic rapport amongst the team
members, the team may not be reaching the fullest potential. Even though a sales
transaction between a seller and a buyer may be a onetime occurrence (or even a
periodic occurrence in respect of retail transactions), the multi-factorial emotional
feel of getting to know a brand, exercising a reasoned choice, being sold with
care, actually experiencing the functionality and after-sales service care, and
having options to upgrade to next generation products all add up to building
the emotional connect around a product, firm and brand.
Wise
companies, therefore, do not consider their responsibility fulfilled with
delivery to the retail chain; they pursue a diligent and caring connect till
the point of contact with the customer, at the time of potential sale and
thereafter. While a firm cannot be present at all points of contact, the firm
would choose associates and partners who are aligned with its own emotional
code of connectivity. The emotive brand loyalty of a firm and its products is
probably the most important determinant of sustainability in a hyper-competitive
market. The emotive brand loyalty does, however, gets built on the foundations
of the six fundamentals that characterize a product or service to the customer:
functionality, reliability, durability, maintainability, affordability and
differentiability.
Posted by Dr CB Rao on February 23, 2014