marketing project repor

8/8/2019 Marketing Project Repor

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Business summary

Our story begins way back in 1970, when we started manufacturing detergent powder ona small scale, for supplying the domestic market. Right from the start, we were very clearabout one thing-that we would never sacrifice quality for quantity. As time went by, weintroduced other detergent products. The customer goodwill generated and the favorablemarket response we received, encouraged us to branch out into other fields. In 1998, weadded dental hygienic products and comsetics to our range. We became a Public LimitedCompany in 1994. Today, We have over 700 agents and distributors, and our products areeven being exported to Russia, Ukraine, UAE and Africa. Our manufacturing facilitiescomprise a 40,000 Sq.Mt. plant involed exclusively in the manufacture of detergents (low-foam powders for indistrial use and high- foam formulations for domestic consumption),with built up area of 5900 Sq. Mt

Products Summary

Our Products are Hipolin Gold Powder, Hipolin Power Hipolin Liquid, Hipolin Super BlueCake, Hipolin Yellow Powder.


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Company ProfileBasic Information

Company Name: Hipolin Limited

Business Type: Manufacturer

Product/Service

(We Sell): Detergent PowderAddress: 4th Floor, Madhuban, EllisbridgeBrands: HipolinNumber of Employees: 101 - 500 People


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B randing ReviewThe central concern of brand building literature experienced a dramatic shift in the last decade. Branding and the role of brands, as traditionally understood, were subject toconstant review and redefinition. A traditional definition of a brand was: the name,associated with one or more items in the product line, that is used to identify the sourceof character of the item(s) (Kotler 2000, p. 396). The American Marketing Association(AMA) definition of a brand is a name, term, sign, symbol, or design, or a combinationof them, intended to identify the goods and services of one seller or group of sellers andto differentiate them from those of competitors (p. 404). Within this view, as Keller(2003a) says, technically speaking, the n, whenever a marketer creates a new name,logo, or symbol for a new product, he or she has created a brand (p. 3). He recognizes,however, that brands today are much more than that. As can be seen, according to thesedefinitions brands had a simple and clear function as identifiers.Before the shift in focus towards brand s and the brand building process, brands werejust another step in the whole process of marketing to sell products. For a long time,the brand has been treated in an off-hand fashion as a part of the product (Urde 1999,p. 119). Kotler (2000) mentions branding as a major issue in product strategy (p.404). As the brand was only part of the product, the communication strategy workedtowards exposing the brand and creating brand image. Aaker and Joachimsthaler (2000)mention that within the traditional branding model the goal was to build brand image ; atactical element that drives short-term results. Kapferer (1997) mentioned that thebrand is a sign -therefore external- whose function is to disclose the hidden qualities of the product which are inaccessible to contact (p. 28). The brand served to identifyproduct and to distinguish it from the competition. The challenge today is to create astrong and distinctive image (Kohli and Thakor 1997, p. 208).

Concerning the brand management process as related to the function of a brand as anidentifier, Aaker and Joachmisthaler (2000) discuss the traditional branding modelwhere a brand management team was responsible for creating and coordinating thebrand s management program. In this situation, the brand manager was not high in thecompany s hierarchy; his focus was the short-term financial results of single brands andsingle products in single markets. The basic objective was the coordination with themanufacturing and sales departments in order to solve any problem concerning salesand market share. With this strategy the responsibility of the brand was solely theconcern of the marketing department (Davis 2002). In general, most companies thought that focusing on the latest and greatest advertising campaign meant focusing on thebrand (Davis and Dunn 2002). The model itself was tactical and reactive rather thanstrategic and visionary (Aaker and Joachimsthaler 2000). The brand was always referredto as a series of tactics and never like strategy (Davis and Dunn 2002).Now: B rand B uilding ModelsKapferer (1997) mentions that before the 1980 s there was a different approach towardsbrands. Companies wished to buy a producer of chocolate or pasta: after 1980, theywanted to buy KitKat or Buitoni. This distinction is very important; in the first casefirms wish to buy production capacity and in the second they want to buy a place in themind of the consumer (p. 23). In other words, the shift in focus towards brands beganwhen it was understood that they were something more than mere identifiers. Brands,according to Kapferer (1997) serve eight functions shown in Table 2.1: the first two aremechanical and concern the essence of the brand: to function as a recognized symbolin order to facilitate choice and to gain time (p. 29); the next three are for reducing theperceived risk; and the final three concern the pleasure side of a brand. He adds that brands perform an economic function in the mind of the consumer, the value of thebrand comes from its ability to gain an exclusive, positive and prominent meaning in theminds of a large number of consumers (p. 25). Therefore branding and brand buildingshould focus on developing brand value.

A B rand B uilding Literature Review

Table 2.1The Functions of the B rand for the Consumer


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Function Consumer benefit Identification To be clearly seen, to make sense of the offer, to quickly identify the sought-after products.Practicality To allow savings of time and energy through identicalrepurchasing and loyalty.Guarantee To be sure of finding the same quality no matterwhere or when you buy the product or service.Optimization To be sure of buying the best product in its category, the best performer fora particular purpose. Characterization To have confirmation of your self-image or theimage that you present to others. Continuity Satisfaction brought about throughfamiliarity and intimacy with the brand that you have been consuming for years.Hedonistic Satisfaction linked to the attractiveness of the brand, to its logo, to itscommunication. Ethical Satisfaction linked to the responsible behavior of the brand in itsrelationship towards society. Adapted from Kapferer (1997) Kapferer s view of brandvalue is monetary, and includes intangible assets. Brands fail to achieve their valuecreating potential where managers pursue strategies that are not orientated tomaximizing the shareholder value (Doyle 2001a, p. 267). Four factors combine in themind of the consumer to determine the perceived value of the brand: brand awareness;the level of perceived quality compared to competitors; the level of confidence, of significance, of empathy, of liking; and the richness and attractiveness of the imagesconjured up by the brand. In Figure 2.1 the relationships between the different concepts of brand analysis, according to Kapferer (1997), are summarized.From B rand Assets to B rand EquityBrand Awareness+ Image+ Perceived quality+ Evocations

+ Familiarity, liking= Brand Assets Brand added valueperceived by customers- Costs of branding- Costs of invested capitalBrand financial value

(BRAND EQUITY) A B rand B uilding Literature Review2.1.2.1 B rand OrientationUrde (1999) presents Brand Orientation as another brand building model that focuses onbrands as strategic resources. Brand Orientation is an approach in which the processesof the organization revolve around the creation, development, and protection of brandidentity in an ongoing interaction with target customers with the aim of achievinglasting competitive advantages in the form of brands (p. 117-118). Brand orientationfocuses on developing brands in a more active and deliberate manner, starting with thebrand identity as a strategic platform. It can be said that as a consequence of thisorientation the brand becomes an unconditional response to customer needs and wants(p. 120). This should be, however, considered carefully given that what is demandedby customers at any given moment is not necessarily the same as that which willstrengthen the brand as a strategic resource (p. 121). Following this reasoning, thewants an needs of customers are not ignored, but they are not allowed to unilaterallysteer the development of the brand and determine its identity (p. 122).According to the brand orientation model, the starting point for a process of brandbuilding is to first create a clear understanding of the internal brand identity. The brandthen becomes a strategic platform that provides the framework for the satisfaction of customers wants and needs (Urde 1999, p. 129). The point of departure for a brandorientedcompany is its brand mission.

Urde s Brand Hexagon (1999), shown in Figure 2.2, integrates brand equity and brandidentity with a company s direction, strategy and identity. The right side of the modelreflects the reference function -product category and product, which are analyzedrationally-, while the left side of the model reflects the emotional function -corporate


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and brand name, which are analyzed emotionally. A brand is experienced in itsentirety (p. 126), which means that both emotions and rational thought are involved.The lower part of the model -mission and vision- reflects the company s intentionstowards the brand, while the upper part reflects the way that target consumers interpret the brand. At the center of the model lies the core process of brand meaning creation,which includes the positioning and core values.

B rand HexagonUrde 1999In summary, in a brand-oriented organization, the objective is -within the framework of the brand- to create value and meaning. The brand is a strategic platform for interplaywith the target group and thus is not limited to being an unconditional response to what at any moment is demanded by customers (Urde 1999, p. 130).Additionally, in a later article, Urde (2003) mentions that the brand building process istwo-part: internal and external. He defines the internal process as that used primarily todescribe the relationship between the organization and the brand, with the internalobjective being for the organization to live its brands. Conversely, the external processis that concerned with relations between the brand and the customer, with the externalobjective of creating value and forming relationships with the customer.2.1.2.2 B rand LeadershipAaker and Joachimsthaler (2000) leave behind the traditional branding model andintroduce the brand leadership model, which emphasizes strategy as well as tactics (p.7). In this model, the brand management process acquires different characteristics: astrategic and visionary perspective; the brand manager is higher in the organization, hasa longer time job horizon, and is a strategist as well as communications team leader;

building brand equities and developing brand equity measures is the objective; and,brand structures are complex, as the focus is on multiple brands, multiple products, andTarget AudienceProduct Vision &MissionBrand nameProduct CategoryCompanynamePositioning:Core ValuesPersonality QualityCommunication2) Associations1) Awareness3) Loyaltymultiple markets. In short, brand identity and creating brand value become the driversof strategy.The brand leadership model is Aaker and Joachimsthaler s (2000) proposal for buildingstrong brands. They argue that there are four challenges, summarized in Figure 2.3, that must be addressed:1) The organizational challenge : to create structures and processes that lead tostrong brands, with strong brand leader(s) for each product, market or country.Also, to establish common vocabulary and tools, an information system that allows for sharing information, experiences and initiatives, and a brand nurturing

culture and structure. Supporting this challenge, Mc William andDumas (1997) argue that everyone on the brand team needs to understand thebrand building process, and they propose metaphors as intelligent tools totransmit the values of a firm. Doyle (2001b) adds that brand management must


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be seen as part of the total management process and not only as a specialist marketing activity.2) The brand architecture challenge : to identify brands, sub-brands, theirrelationships and roles. It is also necessary to clarify what is offered to theconsumer and to create synergies between brands; to promote the leveraging of brand assets; to understand the role of brands, sub-brands, and endorsed brandsin order to know when to extend them; and to determine the relative role of eachbrand of the portfolio. Aaker (2004a) renames brand architecture calling it instead brand portfolio strategy. He says that the brand portfolio strategyspecifies the structure of the brand portfolio and the scope, roles, andinterrelationships of the portfolio brands (p. 13). Therefore, this challengecould be renamed the brand portfolio strategy challenge.3) The brand identity and position challenge : to assign a brand identity to eachmanaged brand and to position each brand effectively to create clarity. Speak (1998) supports and adds to this stating that the brand identity challenge shouldhave a long-term focus in order to integrate the brand building process into thefabric of the organization.4) The brand building program challenge : to create communication programs andother brand building activities to develop brand identity, that help not only withthe implementation but also in the brand defining process. In short, brandbuilding must do what is necessary to change customer perceptions, reinforceattitudes, and create loyalty. One tactic to do so would be to consider alternativemedia in addition to advertising. Doyle (2001b) also adds that the brand strategymust maximize shareholder value.Figure 2.3

B rand Leadership TasksAaker and Joachimsthaler 20002.1.2.3 B rand Asset Management Davis (2002) also talks about a new way of managing brands. He argues that brands,along with people, are a company s most valuable asset. There is growing support forviewing and managing the brand as an asset and thus having the brand drive everystrategic and investment decision (Davis and Dunn 2002, p. 15). This becomes relevant given that the top three strategic goals for brand strategy nowadays are increasingcustomer loyalty, differentiating from the competition, and establishing market leadership (Davis and Dunn 2002). It is important for a company to change its state of mind in order to adopt this perspective because brand management has to report all theway to the top of the organization and has to involve every functional area (DavisB rand Architecture- Brands/sub-brands/endorsedbrands- Roles of brands/sub-brandsB randLeadershipB rand Identity/Position- Aspiration image- Positioning the brandOrganizational Structure andProcesses- Responsibility for brand strategy- Management processesB rand- B uilding Programs- Accessing multiple media- Achieving brilliance

- Integrating the communication- Measuring the results A B rand B uilding Literature Review8


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2002, p. 9). Davis (2000) defines Brand Asset Management as a balanced investment approach for building the meaning of the brand, communicating it internally andexternally, and leveraging it to increase brand profitability, brand asset value, and brandreturns over time (p. 12). Some of the shifts from traditional brand management to thisnew model are highlighted in Table 2.2.Table 2.2The Shift from Traditional B rand Asset Management Davis 2002The Brand Asset Management process, as shown in Figure 2.4, involves four phasesand eleven steps. The first phase is to develop a brand vision, which consists of a singlestep: developing the elements of a brand vision. The basic objective of this step is toclearly state what the branding efforts must do to meet corporate goals. The secondphase is to determine the company s Brand Picture by understanding consumerperceptions about the brand and of competitor brands. This phase consists of threesteps: determining the brand s image, creating the brand s contract - list of customer sperceptions of all the current promises the brand makes-, and crafting a brand-basedcustomer model -which allows for understanding how consumers act and think, andhow and why they make their purchase decisions. The third phase is to develop a brandasset management strategy, in order to determine the correct strategies for achievinggoals according to the brand vision. This phase consists of five steps: positioning thebrand, extending the brand, communicating the brand s positioning, leveraging thebrand, and pricing the brand. Finally, the fourth phase is to support a brand asset Traditional Brand Management Brand management Brand managers

RetentionOne-time transactionsCustomer satisfactionProduct-driven revenuesThree-month focusMarket share gainsMarketing manages the brandAwareness and recall metricsBrand is driven internallyBrand Asset Management Strategy Brand asset management strategyBrand champions and ambassadorsDeep loyaltyLifetime relationshipsCustomer commitment Brand-driv en revenuesThree-year focusStock price gainsAll functional areas manage thebrandSophisticated brand metricsBrand is driven externally A B rand B uilding Literature Review9management culture. This final phase consists of two steps: creating a measure of thereturn on brand investment, and establishing a brand-based culture.Figure 2.4B rand Asset Management Process

Davis 20022.1.2.4 LOGMAN ModelThe logical brand management or LOGMAN model, combines insights from Kaplanand Norton s balanced scorecard method, BCG s brand value creation method, the path


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analysis method, the gap analysis method, and the house of quality method (Logman2004). The model proposes a logical brand consistency audit by presenting thefollowing questions: Is there a logical interaction between the company s brand drivers?Phase 1- Developing a brand visionPhase 2- Determining B rand PictureStep 2Determining brand imageStep 3Creating brand contract Step 4Brand-based customer modelPhase 3- Developing a brand asset management strategyStep 5Positioning the brandStep 6Extending the brandStep 7Communicating brand s positioningStep 8Leveraging the brandStep 9Pricing the brandPhase 4- Supporting a brand management cultureStep 10

Measuring return on brand investment Step 11Establishing a brand-based cultureStep 1Elements of a brand vision A B rand B uilding Literature Review10 Are the company s brand drivers perceived by customers the way the companywants them to be? Are the company s brand drivers perceived by customers the way the customerswant them to be? Are the external brand drivers perceived by customers the way the companywants them to be? Is there logical consistency between the company s brand drivers across thedifferent customer segments addressed? Is there logical consistency between the company s brand objectives at different perspective levels? Is there logical consistency between the brand s drivers over time?According to the author, answering these questions helps to identify real problems andkey drivers for their solution, and to analyze brand policy in a specific context.2.2.3 Corporate B randingThe most recent turn in branding literature emerged in the mid-nineties. Businessesbegan shifting their focus from product brands to corporate branding (de Chernatony1999, Hatch and Schultz 2003). The corporate brand perspective supports, and could bea consequence of, the strategic view of brands. King (1991) is considered to be the first author to make a clear distinction between product and corporate brands, emphasizingthe importance of a multidisciplinary approach in order to manage them. It is after 1995when more research on corporate branding is published. Balmer and Gray s (2003)

literature review on corporate brand ing presents different visions that have beendeveloped during the years prior. They conclude that corporate brands are leading to thedevelopment of a new branch of marketing which should be known as corporate- levelmarketing


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(Balmer and Greyser 2003).Aaker (2004a) defines a corporate brand as a brand that represents an organization andreflects its heritage, values, culture, people, and strategy. Corporate branding congruent with the strategic brand vision (Schultz and Hatch 2003), dwells on developing brandsat an organizational level (Knox and Bickerton 2003) -which requires managinginteractions with multiple stakeholders (Balmer and Gray 2003, Knox and Bickerton2003, Hatch and Schultz 2003, Aaker 2004b). A corporate brand is defined primarily by A B rand B uilding Literature Review11organizational associations (Aaker 2004b), and thus can develop and leverageorganizational characteristics, as well as product and service attributes (Aaker 2004a).Urde (2003) states that corporate brands must reflect organizational values. In otherwords, an organization s core values must be the guiding light of the brand buildingprocess, both internally and externally. They must be built into the product, expressed inbehavior, and reflected in communication. Core values influence continuity,consistency and credibility in the building of a corporate brand (p. 1036).According to Balmer and Gray (2003), corporate and product brands are different interms of their composition, constituencies, maintenance, management, and disciplinaryroots. Hatch and Schultz (2003) distinguish six differences between product andcorporate branding:1) The shift in focus from product to corporation of the branding effort;2) The different exposure the organization is subject to, which makes the firm sbehavior and its interaction with society much more visible;3) The relation of the brand to all company stakeholders, not just customers;4) The requirement of organization-wide support;

5) The temporal dimension of corporate brands includes past and future, not just present;6) The greater reach of corporate brands than product brands means that they takeon more strategic importance.Given these differences, they describe a corporate branding framework, shown in Figure2.5, which is based on three elements: strategic vision, organizational culture andcorporate image. They argue that developing the corporate brand involves articulatingand aligning these three elements, which can be achieved when an effective dialoguebetween top management, external stakeholders, and members of the organizationalculture is established. Given the fact that corporate brands concern multiplestakeholders, Knox and Bickerton (2003) suggest that this framework should beextended in order to include a fourth variable: the competitive environment of theorganization, both from the perspective of its current image and current culture. A B rand B uilding Literature Review12Figure 2.5Elements of Corporate B randingHatch and Schultz 2003Knox and Bickerton (2003) identify six conventions of corporate brand building,illustrated in Figure 2.6. They are: B rand context : understanding where the brand stands B rand construction : how the brand is positioned in accordance to customer andstakeholder value B rand confirmation : the way the brand is articulated to the rest of theorganization and all of its audiences B rand consistency : delivering clarity to all stakeholders through itscommunication channels B rand continuity : the alignment of business processes with the corporate brand

B rand conditioning : the ability to monitor and manage the brand on a continualbasisFigure 2.6The Six Conventions of Corporate B randing


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Knox and Bickerton 2003CorporateBrandingV isionCulture ImageCorporateB randingB randcontext B randconditioningB randcontinuityB randconsistencyB randconfirmationB randconstruction A B rand B uilding Literature Review13In sum, from the corporate brand vision every activity of the company should be seenthrough the lens of the brand (Schultz and Hatch 2003).2.3 B RAND EQUITY The brand equity concept has been mentioned in more than one of the previously

analyzed models. But what exactly is brand equity? Brand equity, as first defined byFarquhar (1989), is the added value with which a given brand endows a product (p.24). Apart from Farquhar s first definition of brand equity, other definitions haveappeared. According to Lassar, Mittal, and Sharma (1995), brand equity has beenexamined from a financial (Farquhar, Han, and Ijiri 1991; Simon and Sullivan 1993;Kapferer 1997, Doyle 2001b), and a customer-based perspective (Keller 1993; Shocker,Srivastava, and Rueckert 1994; Chen 2001). In other words, financial meaning from theperspective of the value of the brand to the firm, and customer-based meaning the valueof the brand for the customer which comes from a marketing decision-making context (Kim, Kim, and An 2003).Brand equity has also been defined as the enhancement in the perceived utility anddesirability a brand name confers on a product (Lassar, Mittal and Sharma 1995, p.13). High brand equity is considered to be a competitive advantage since: it implies that firms can charge a premium; there is an increase in customer demand; extending a brandbecomes easier; communication campaigns are more effective; there is better tradeleverage; margins can be greater; and the company becomes less vulnerable tocompetition (Bendixen, Bukasa, and Abratt 2003). In other words, high brand equitygenerates a differential effect , higher brand knowledge , and a larger consumerresponse (Keller 2003a), which normally leads to better brand performance, both froma financial and a customer perspective.2.3.1 Financial PerspectiveFinancial value-based techniques extract the brand equity value from the value of thefirm s other assets (Kim, Kim, and An 2003). Simon and Sullivan (1993) define brandequity as the incremental cash flows which accrue to branded products over and abovethe cash flows which would result from the sale of unbranded products (p. 29). These A B rand B uilding Literature Review14authors estimate a firm s brand equity by deriving financial market estimates from

brand-related profits. Taking the financial market value of a firm as a base, they extract the firm s brand equity from the value of the firm s other tangible and intangible assets,which results in an estimate based on the firm s future cash flows. Along the same lineof thought, Doyle (2001b) argues that brand equity is reflected by the ability of brands


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to create value by accelerating growth and enhanc ing prices. In other words, brandsfunction as an important driver of cash flow.2.3.2 Customer PerspectiveAccording to Lassar, Mittal and Sharma (1995), five dimensions configure brandequity: performance, value, social image, trustworthiness, and commitment. Aaker andJoachimsthaler (2000) define brand equity as brand assets linked to a brand s name andsymbol that add to, or subtract from, a product or service. According to them, theseassets, shown in Figure 2.7, can be grouped into four dimensions: brand awareness,perceived quality, brand associations, and brand loyalty.Figure 2.7B rand EquityAaker and Joachimsthaler 2000These dimensions have been commonly used and accepted by many researchers (Keller1993; Motameni and Shahrokhi 1998; Yoo and Donthu 2001; Bendixen, Bukasa, andAbratt 2003; Kim, Kim, and An 2003). Brand awareness affects perceptions and taste:

people like the familiar and are prepared to ascribe all sorts of good attitudes to itemsthat are familiar to them (Aaker and Joachimsthaler 2000, p. 17). Perceived qualityinfluences brand associations and affects brand profitability. Brand associations areanything that connects the consumer to the brand, including user imagery, product attributes, organizational associations, brand personality, and symbols (p. 17). Brandloyalty is at the heart of brand s value. The concept is to strengthen the size andintensity of each loyalty segment (p. 17). Any way that brand equity is considered, it Brand EquityBrandAwareness

PerceivedQualityBrandAssociationsBrandLoyalty A B rand B uilding Literature Review15can be understood as the incremental value a brand name grants a product (Srivastavaand Shocker 1991).Keller (1993) introduces the Customer-Based Brand Equity (CBBE) model, which

approaches brand equity form the perspective of the consumer -whether it be anindividual or an organization (Keller 2003a, p. 59). The model is based on the premise

that the power of a brand lies in what customers have learned, felt, seen and heardabout the brand as a result of their experiences over time (p. 59). He defines CBBE asthe differential effect that brand knowledge has on consumer response to the marketingof that brand (p. 60), which emerges from two sources: brand awareness and brandimage.According to Keller (2003a), brand awareness consists of brand recognition -the

consumer s ability to confirm prior exposure to the brand when given a brand as a cue(p. 67)- and brand recall -the consumer s ability to retrieve the brand form memorywhen given the product category, the needs fulfilled by the category, or a purchase orusage situation as cue (p. 67). On the other hand, brand image is created by marketingprograms that link strong, favorable, and unique associations to the brand in thememory (p. 70). These associations are not only controlled by the marketing program,but also through direct experience, brand information, word of mouth, assumptions of the brand itself -name, logo-, or with the brand s identification with a certain company,country, distribution channel, person, place or event.

The way to build a strong brand, according to the CBBE model, is by following foursequential steps, each one representing a fundamental question that customers ask about brands: 1) Ensuring the identification of the brand with a specific product category orneed in the customer s mind -who are you?, 2) Establishing the meaning of the brand in


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the customer s mind by strategically linking tangible and intangible brand associationswith certain properties -what are you? 3) Eliciting customer responses to the brandidentification and meaning -what about you? 4) Converting the response into an active,intense and loyal relationship between the customers and the brand -what about you andme? The CBBE model is built by sequentially establishing six brand building blockswith customers (Keller 2003a. p. 75), that can be assembled as a brand pyramid, shownin Figure 2.8. Brand salience relates to the awareness of the brand. Brand performance A B rand B uilding Literature Review16relates to the satisfaction of customers functional needs. Brand imagery relates to thesatisfaction of customers psychological needs. Brand judgments focus on customersopinions based on performance and imagery. Brand feelings are the customersemotional responses and reactions to the brand. Brand resonance is the relationship andlevel of identification of the customer with a brand.Figure 2.8Customer- B ased B rand Equity PyramidKeller 2003a2.3.3 Combined PerspectiveSome authors have linked both the financial and the customer-based perspectives of brand equity. Motameni and Shahrokhi (1998) developed a model called Global BrandEquity (GBE) that estimates brand equity and shows its sources of value. They use aninterdisciplinary approach that is able to quantify value components and apply financialtechniques. Baldauf, Cravens, and Binder (2003) state that cash flow and short-termparameters are what usually firms use as indicators of performance, without consideringbrand-based performances. In their study, they suggest using perceived quality, brand

loyalty, and brand association as measures of brand equity, and they find that firms withhigher levels of these measures have higher levels of performance. This confirms theimportance of brand equity as an indicator of performance. Dyson, Farr, and Hollis(1996), after recognizing the financial value attached to brands, propose aconsumerdrivensystem of measuring equity. They argue that economic value is created inResonanceFeelings JudgmentsSaliencePerformance Imagery1. IdentityWho are you?2. MeaningWhat are you?3. ResponseWhat about you?4. RelationshipsWhat about you and me? A B rand B uilding Literature Review17transactions which are the source of equity. Therefore, they developed a model calledthe Consumer Value Model that predicts transactions in order to bridge the gapbetween the intangible perceptions and the tangible revenues generated by a brand.2.4 OTHER CONCEPTSIn addition to the brand building models discussed above, it is worth mentioning someother relevant concepts found in literature.2.4.1 B rand IdentityPark, Jaworski and MacInnis (1986) say that brand image is the understanding

consumers derive form the total set of brand-related activities engaged by the firm (p.135). De Chernatony (1999) suggests passing from brand management to identitymanagement by placing special importance on the internal aspect of brand building. Heargues that more emphasis needs to be placed on brand identity. Identity, he mentions,


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is about ethos, aims and values that present a sense of individuality differentiating thebrand (p. 165). He conceptualizes the brand s identity in terms of vision and culture,which drive positioning, personality, and any other subsequent relationships. In thissense, employees and staff members vision and culture affect the brand buildingprocess. He therefore argues that more attention should be placed on internal aspects of branding, such as the role staff plays in shaping a brand s values.2.4.2 B uilding Services B randsIn a subsequent article, a particular perspective for building services brands is suggestedby de Chernatony and Segal-Horn (2001). Given the unique characteristics of services -intangibility, inseparability of production and consumption, heterogeneity of quality,and perishability-, delivery of the services brand is about the experience of thecustomer at the interface with the service provider (p. 648). Therefore, the authorsargue, it is not correct to use the classical branding models for the service sector, giventhat the staff plays an important role in services branding, influencing brand qualityand brand values through interactions they have with consumers (p. 665). Underwood,Bond, and Baer (2001) contribute to the discussion about building service brands byusing the sports marketplace as an example. They provide a conceptual foundation for A B rand B uilding Literature Review18understanding the role of social identity in the services brand building process. Theyidentify four characteristics of the sports environment and propose that brands can bestrengthened by fostering group experiences, establishing a unique history or traditions,initiating rituals, and designing a physical facility where the brand identity and anexperience can be shared.2.4.3 B rand Personality

Aaker (1997) develops the concept of brand personality, or the set of humancharacteristics associated with a brand (p. 347). She creates a reliable, valid, andgeneralizable brand personality measurement scale based on an extensive datacollection involving ratings of 114 personality traits on 37 brands in various product categories by over 600 individuals (Keller 2003a p. 447). In her resulting framework,shown in Figure 2.9, five dimensions are distinguished -the big five - that help toexplain the symbolic and self-expressive functions of a brand: sincerity, competence,excitement, sophistication, and ruggedness.Figure 2.9 A B rand Personality Framework Aaker 19972.4.4 B rands as a RelationshipFournier (1998) suggests that a brand can be viewed as a relationship partner. One wayto achieve this is by understanding the ways in which brands are animated, humanized,or somehow personalized (p. 344). She mentions three brand animating processes:through the spirit of a past or present other, by using brand-person associations, andthrough a complete anthropomorphization of the brand. Brand relationships happen at Brand PersonalitySincerity Excitement Competence Sophistication Ruggedness

Down-to-earth Honest Wholesome Cheerful Daring Spirited Imaginative Up-to-date Reliable

Intelligent Successful Upper class Charming


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Outdoorsy Tough

A B rand B uilding Literature Review19the level of consumers lived experiences (p. 360). These relationships offer meaningsto the consumer, some being functional and utilitarian, while others are psychological oremotional.2.4.5 B rand OriginThakor and Kohli (1996) argue that in addition to the traditional concepts identified asbrand equity influencers, brand origin must also be considered. They define brandorigin as the place, region or country to which the brand is perceived to belong by itscustomers (p. 27). Brand origin can be more or less salient for some brands or others,and therefore, the use of origin cues should be subtle and implicit when the brandconcept relies more on symbolism, while more explicit when the brand concept reliesmore on features. In a later article, Thakor and Lavack (2003) state that even moreimportant than the brand origin itself is the perceived brand origin as a source of brandappeal. In their study the authors show that country of corporate ownership is a strongdeterminant of brand origin perceptions furthermore, country of perceived corporateownership may also be a stronger influence than actual country of corporate ownership(p. 403). It is similarly important that less concern be given to the place where brandsmanufacture their products, and more to the place where people perceive the brand scountry of origin to be.2.4.6 B rand CommunitiesBrand communities (Muniz and O Guinn 2001; Mc Alexander, Schouten, and Koenig2002) is another concept found in literature that can strengthen brand equity, while also

reinforcing the social nature of brands. Brand communities carry out important functions on behalf of the brand, such as sharing information, perpetuating the historyand culture of the brand, and providing assistance. They provide social structure to therelationship between marketer and consumer (Muniz and O Guinn 2001, p. 427).Muniz and O Guinn (1991) define a brand community as a specialized, nongeographicallybound community, based on a structured set of relationships amongadmirers or a brand (p. 412). According to their research, brand communities sharethree core characteristics: the existence of a consciousness of a kind, the presence of shared rituals, and a sense of moral responsibility between members. A B rand B uilding Literature Review202.4.7 Experiential B randingSchmitt s (1999) experiential marketing concept also adds to the traditional view of thebranding concept. He explicitly states how the brand as an identifier has evolved tobecome a provider of experiences. The experiential marketing approach views brands asan integrated holistic experience, which is possible to create through nurturing sensory,affective and creative relations, as well as associating a lifestyle with the brand.2.4.8 B rand StewardshipBrand Stewardship, as Speak (1998) defines it, is the leadership of and theaccountability for the long-term well-being of the organizational brand equities (p. 33).A brand that develops a stewardship process - meaning that it engages an executiveleadership in articulating a vision for key market relationships, imbues the brandbuilding process to the whole marketing process, and obtains the compromise of thewhole organization to transmit the brand promises through every action taken- willgenerally obtain brand- loyal customers.2.4.9 Emotional B randingGob (2001) believes that the emotiona l aspect of brands is what makes a key differencefor consumers. He argues that people are interested in buying emotional experiences,

and he calls the brands that are able to create an emotional bond with their clientsemotional brands. According to him, emotional brands share a set of common valuesthat make them highly sought. These values are: a great corporate culture focused on people,


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a communication style and philosophy that stands out, and an emotional hook that draws consumers to their promise.2.4.10 Citizen B randsExtending his ideas, Gob (2002) says that today consumers do not want to beromanced by brands, but want to establish multifaceted, holistic relationships withthem. People s emotional bond with brands is influenced by knowing if brands behavewell and are actively involved in making the world a better place. A B rand B uilding Literature Reviewneighbors. Therefore, he introduces the concept of citizen brands which exist in firmsthat take into consideration the impact on people, both internally and externally, of every decision they make. In other words, a citizen brand is a socially responsiblebrand.2.4.11 CSRFinally, corporate social responsibility (CSR) must be mentioned as another concept that is influencing the development of brands nowadays, especially corporate brands.Both branding and CSR have become crucially important now that the organizationshave recognized how these strategies can add or detract from their value (Blumenthaland Bergstrom 2003). Criticism of business is more far-reaching than ever before due tohigher expectations of businesses today (Smith 2003). As Smith and Alcorn (1991)mention, corporations have integrated marketing strategy and social responsibility, andthis integrated strategy has been labeled cause marketing. Because corporations alreadyinvest in both branding and philanthropy, the rationale for integrating branding and CSRderives from the synergies created when both strategies merge (Blumenthal andBergstrom 2003).CSR literature is ample and it is not the subject of this thesis to analyze it. However, it

is necessary to establish how closely related is brand building towards social values tothis concept. CSR refers to the obligations of the firm towards society (Smith 2003). It also refers to the consideration of and response to issues beyond the narrow economic,technical, and legal requirements a firm has in order to accomplish social benefits alongwith traditional economic gains (Husted 2003). An example of a CSR governancestructure is a collaborative scheme, which involves a partnership between the firm andan organization in which the firm transfers resources to the organization in order tocarry out CSR activities jointly (Husted 2003). This same structure is necessary toimplement the brand building towards social values model that is described in thefollowing sections.CSR can be defined in terms of legitimate ethics or from an instrumentalist perspectivewhere corporate image is the prime concern (McAdam and Leonard 2003). Brandbuilding towards social values relates to CSR in both ways. A B rand B uilding Literature ReviewGiven that brand building is strategic, and according to strategy the brand must reflect thevalues of a firm, the corporate responsibility values projected by a brand must belegitimate. If not, the risk of being perceived as dishonest or untrustworthy creates a lack of congruence that can negatively affect brand image. While corporate image is not theprime concern here, as just explained, it is an important element in the branding process.Blumenthal and Bergstrom (2003) expose four key reasons for integrating CSR underthe umbrella of the brand which are: recognizing the magnitude of the brand promise;maintaining customer loyalty; maximizing investment that would be placed in CSRregardless of the brand; and avoiding conflict with shareholders. In other words,

branded CSR turns philanthropy from implicit delivery of the promise to an explicit one (p. 337). This becomes everyday more important as the public wants to knowwhat, where, and how much brands are giving back to society.

Brand LoyaltyB rand loyalty is the ultimate goal a company sets for a branded product. Inpreviousarticles, the defi nition and importance of branded were discussed, as well as necessarysteps needed to brand a product. This article focuses on brand loyalty, its importance to acompanyand steps necessary to convert to and maintain brand loyalty.


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W hat is B rand Loyalty?Brand loyalty is a consumer s preference to buy a particular brand in a product category.It occurs because consumers perceive that the brand offers the right product features,images or level of quality at the right price. This perception becomes the foundation for anew buying habit. Basically, consumers initially will make a trial purchase of the brandand,after satisfaction, tend to form habits and continue purchasing the same brand becausethe product is safe and familiar.Brand loyalists have the following mindset:

I am committed to this brand. I am willing to pay a higher price for this brand over other brands. I will recommend this brand to others.

W hy is B rand Loyalty Important to the B ottom Line?There are three main reasons why brand loyalty is important: Higher Sales Volume Theaverage United Statescompany loses half of its customers every five years, equating to a 13 percent annual lossof customers. This statistic illustrates the challenges companies face when trying to growin competitive environments. Achieving even 1percent annual growth requires increasingsales to customers customers, both existing and new, by 14 percent. Reducing customerloss can dramatically improve business growth and brand loyalty, which leads toconsistent and even greater sales since the same brand is purchased repeatedly.

Premium Pricing Ability Studies show that as brand loyalty increases, consumers areless sensitive to price changes. Generally, they are willing to pay more for their preferredbrand because they perceive some unique value in the brand that other alternatives donot provide. Additionally, brand loyalists buy less frequently on cents-off deals; thesepromotions only subsidize planned purchases.

Retain Rather than Seek Brand loyalists are willing to search for their favorite brandand are less sensitive to competitive promotions. The result is lower costs for advertising,marketing and distribution. Specific call, it costs four to six times as much to attract a newcustomer as it does to retain an old one.W hat is the Process to Create and Maintain B rand Loyalty?Favorable brand attitudes are the determinants of brand loyalty consumers must likethe product in order to develop loyalty to it. To convert occasional purchasers into brandloyalists, habits must be reinforced. Consumers must be reminded of the value of theirpurchase and encouraged to continue purchasing the product in the future.To encouragerepeat purchases, advertisement before and after the sale is critical. In addition tocreating awareness and promoting initial purchases, advertising shapes and reinforcesconsumer attitudes so these attitudes mature into beliefs, which need to be reinforceduntil they develop into loyalty. For example, the most avid readers of a travel ad are thosewho just returned from the destination.

THE ELONGATING TAIL OF B RAND COMMUNICATIONAn approach to brand-building incorporating long tail economics

byMohammed Iqbal,

When you can dramatically lower the costs of connecting supply and demand,it changes not just the numbers, but the entire nature of the market.

Chris Anderson, The Long Tail Ever since Chris Anderson first wrote about the long tail in a feature for WIRED magazinein October 2004, the term has found application in myriads of fields. A simple long tail ofsearch will yield a depth of results that can only be explained by the very term itself.There s mention of the long tail of scientific research, long tail of tags, long tail of softwaredemand, long tail of TV, long tail of popularity, long tail of legal scholarship, long tail of

camps, long tail of programming languages, long tail of the blogosphere, long tail of innovation, long tail of choice, long tail of video games, long tail of the flat world, long tailof street entrepreneurs There s even a mention of the long tail of alcohol distribution!And I was still only into the third page of Google results. However, the long arm of the long


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tail still hasn t yet found its way to some not-so-remote corners of the universe. The longtail of brands (not to be confused with the long tail of advertising, which is covered byChris Anderson in the subsequent book he wrote) is very sparse and anorexic, at least asfar as Google results go. Only four mentions show up. And the long tail of brand-buildingor branding the process of creating, honing, nurturing and shepherding aproduct/service from the wilderness of anonymity to the city square of instant recognition, recall and familiarity is conspicuous by its absence. In fact, brand experts goabout their business as if it has been inoculated against the long tail epidemic. Almost allof them, it seems, are keen to keep sailing in the direction their ships have been plough ingall these years and at least one guru insists on pushing the envelope further into short head territory. In a celebrated speech at Cannes last year, Lord Maurice Saatchi unveiledhis agency s thinking on building brands in the future. Mixing psychology with the Bible,his answer to the perils of brand-building in the internet era is simple push deeper,harder and farther than we have done all these years.Owning a clear, unique, single-minded proposition wasn t enough. To succeed in a worldof message fragmentation, media fragmentation, continuous partial attention (CPA), andnon-existent day-after-recalls (DAR), one has to hone the brand positioning relentlessly,until only one word yes, one measly word - remained. Two words were one word toomany, as Lord Saatchi reminded those pleading for lenience. For Brand America it was

Freedom. For Coca-Cola it s Refreshing. For Sony, it may be Feel. For HP,it s Invent. The challenge was to find the word and not forsake it, ever. Having beenanointed, The Word will guide the brand s future its every move as a company, and not just its advertising and communication.According to Lord Saatchi, One Word Equity as this new approach was christened willgive advertising the kiss of life it so direly needs. For it was no less than advertising s

funeral he had come to attend at Cannes, before being called upon to give it the CPRroutine.Of simplicity and complexityThe reaction to Lord Saatchi s speech was mixed. One half of the advertising world bredon the scarcity of media and the consequent need to be pithy and single-minded in what one is saying applauded slavishly. To them, this spartan future world seemed just what the doctor had ordered. They could now go home and continue to do the same thingsthey were used to doing only working on it much harder and burning more of themidnight oil. The boisterous half most of whom seemed to be voicing their opinion onthe blogosphere differed. The really picky ones seemed to note that it took two thousandand five words to explain One Word Equity. In fact, One Word Equity itself was two wordstoo long. Most of the considered reaction was an unequivocal rejection of thedisingenuous and un-layered simplicity a One Word Equity exercise leaves behind.Simplifying was one thing, simplicity was another. And in this world, though no one couldquite define why, simplicity was no longer desirable. One had to be simple and yet not eschew complexity a task that s easier said than done. Russell Davies, plannerprovocateur and ex-world wide planning head of Nike, wrote on his blog (thoughnot directly in response to Lord Saatchi s speech) : What people actually want is stuff with some complexity, some meat, some richness. Stuff that has depth, humour, tension,drama etc etc. Not stuff that's distilled to a simple essence or refined to a single compellingtruth. No-one ever came out of a movie and said "I really liked that. It was really clear."Clarity is important to our research methodologies, not to our consumers.Judging by the reaction to this post and by the Mexican wave of blog posts and commentscriticizing One Word Equity, it was obvious this idea of brand polyphony (as Russell callsit) was infectious and appealing. It s appealing because we ourselves as consumers seek it.We find fault in movie-characters for being too uni-dimensional. We say people areuninteresting (or boring) if their range of interests or conversations are too narrow.In The Long Tail, Chris Anderson states an essential truth we all know and take for

granted - Everyone s taste departs from the mainstream somewhere.But what traditional brand-building with its single minded and simple (and sometimessimplistic) brand idea does is ignore that reality and reduces to the lowest commondenominator all our individual relationships with one brand. There s only one view of a


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brand you can have the one that it has so painstakingly assembled for itself. All otherprobable ideas about the brand are deemed to be incompatible with this one andshouldn t be entertained.W ill the twain ever meet?So, is there some way of reconciling this need to be simple in our communication and stillnot be perceived as a simpleton? Is there a brand-building model that can give us layered,nuanced and intriguing brands that are more than just skin deep and one word thin?The answers to these questions overlap with the answer to the larger question (and theright one) I believe we should be asking in a world populated by Lord Saatchi s digitalnatives, digital immigrants and everyone else.

What are the changes being wrought upon the business of brand-building by thisrelentless shift towards long tail economics? The answer is nothing short of cataclysmicand will represent a departure from everything advertising and brand-building has stoodfor until now. But before we embark on that journey, here s a brief summary of the longtail and its terminology. A short summary of the long tailThe original WIRED article introducing the long tail paraphrased the essential thinkingbehind it in a terse, and instructive, sub-head Forget squeezing millions from a fewmega-hits at the top of the charts. The future of entertainment is in the millions of nichemarkets at the shallow end of the bitstream. It is common knowledge that when you plot all the products (in a company or a supermarket or the universe) on the x-axis andcorresponding revenues on the y-axis, you get what is called a Pareto distribution curve.More commonly recognizable as the 80/20 principle, this law suggests that a majority of the sales come from a very few products.

F igure 1. Pareto distribution curve illustrating the 80/20 principle .The black part of thecurve are the hits the 20% that bring in80% of the profits. The white portion of the curve represents the hitherto ignored long tail of the market.This sort of distribution is easily accessible and verifiable by experience it is a truththat s been sprinkled with great generosity all around us. A tiny percentage of our clientsdo indeed give us most of our business. About 20% of words in the English language doform the basis for 80% of our conversation. Small concentrated areas of land in a countryare likely to be home to a majority of its population. And so on. In real and measurableterms, the distribution is more 80/10 that it doesn t add to 100 doesn t matter becausethey are percentages of different things. This Law of the Vital Few is so ubiquitous, in fact,that we take it for granted that that s how the world is and is meant to be. In particular,the 80/20 principle is the dominating force that has shaped our understanding of businessand popular culture - and how we expect to experience both. Take the pre-online musicindustry as an example. Only a handful of music albums released every yearwere hits they made it to the Top 40 countdown, to store shelves, to TV and radio playtimes and the written (and unwritten) annals of pop culture. These were the hits that raked in the money the rest were destined to obscurity and a bad-rep as money-losersand failures.Recognizing this and with their own 80/10 and scarcity principles to deal with, the retailbusinesses where we buy our music, primarily stocked only the hits. With limited andexpensive shelf space to compete for, a mainstream hit album stood more of a chance of earning its keep than a niche album. Further, a hit album was the breadwinner not just foritself but also for the albums expected to be hits.Because no matter how carefully one screened what makes it to the shelves, some of theseprojectionsinvariably turned out to be wrong.So what happens to the remaining 80% of the albums recorded every year? Very few

make money of anysort and are destined to be the dark matter of our culture around, but invisible both tothe eyes of commerce and discerning taste.


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7But things have changed with the arrival of online retailers like Amazon, Rhapsody andiTunes. WhileWal-mart can stock only 4,500 unique albums (amounting to 25,000 songs) on its shelves,Rhapsody storesas many as 1.5 million unique song tracks on its servers.And if you think that the majority (the tail) of these songs simply exist with no takers, youwill besurprised. A vast majority of the songs on Rhapsody even up to a staggering 900,000 andbeyond havebeen streamed or bought at least once. And as you trek upslope of the tail, many moretimes.While these sales individually can t rival the mega-hits the songs that sell by the millions

theircombined sales amount to a significant addition to revenues. In fact, as Rhapsody andother online retailersbuild up their collection further, the revenues from this long tail can even match therevenues from the short

hit-driven head of the curve.The reason why Rhapsody can pull this off is because, unlike a real world retailer, theydon t have to dealwith a scarcity of shelf space. With virtually unlimited shelf space and an almost negligiblerental on it,Rhapsody can treat all its tracks as equal the mega-hits, the hits, the near misses, and theones that will

only sell in ones and twos.The phenomenon of the long tail was first put into practice at Amazon s online book business. And now it has found application across industries. Rhapsody and iTunes in music; Netflix in movies;E-bay, andAmazon s own Marketplace programme, in retaling; Google in advertising (through itsAdSense andAdWords programmes), etc.Misconceptions and misnomersOne of the most common misconceptions about the long tail is that it requires the Internet as a preconditionfor it to work. It s true that the Internet has given rise to the most visible and celebratedexamples(ironically, the hits) of the long tail phenomenon. But its existence (or involvement) isn t anecessarycondition for the working of a long tail.In his book, Chris Anderson begins the narrating the history of the long tail with Sears andRoebuck andhow in 1906 they revolutionized shopping with their mail-order catalog business. Fromtheir giganticwarehouses in Chicago they could stock and deliver over 200,000 items, compared to themere couple of thousand at the nearest general store. And what s more, their efficiencies meant that people could buy themat as much as 50 per cent lesser, even after shipping.8Mail order catalogs were the long tail of general stores and so were the supermarkets that emerged soon

after. Correspondence courses and degrees were the long tail of college education beforeonline educationtook over. Credit cards are the long tail of the money lending industry.


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In fact, as Chris Anderson mentions, The story of the Long Tail is really about theeconomics of abundance what happens when the bottlenecks that stand between supply and demandin our culture start to disappear and everything becomes available to everyone.This process of easing of bottlenecks is gradual and wherever supply and demand aremaking light of thehurdles (with or without the help of the Internet), there s a long tail blooming.The second misconception about the long tail is that it s an absolute term that in a givenmarket there sone concrete, well-defined and addressable block that responds to the name of long tail.The truth is that the long tail is a relative term and the long tail is in fact made up of hundreds of longtails, each with heads of their own. And no matter where you are on the curve there s along tail waiting tobe unearthed further down the tail.In that sense, time and technological progress are the twin engines that gradually dissolvethe barriers tosupply and demand until a time when we ll simply have culture unfiltered by economicscarcity.In my opinion, one reason why these misconceptions exist is because of the name. ChrisAnderson pickedup the name from statistics curves with characteristics of these power law distributionsare called longtaileddistributions. Chris merely turned it into a proper noun and the long tail was born.

I think a better-serving name would have been the elongating tail an adverb + nounpairing capturingnot just its present tail state but also suggesting the permanence of movement inherent init.With this name, the birth of the internet would have just been an incident (albeit asignificant one) in thehistory of the elongating tail. A history that dates back to the times when man first startedgathering at marketplaces for barter and trade, instead of settling for whatever his neighbour couldoffer.The long tail hits a bottleneck We began this journey together wondering why there has been no application of long tailthinking in brandbuilding.There are a few good reasons why.9One, the current discussions of the long tail (in the book written by Chris Anderson and inthe media) havelargely concentrated on the most visible instances of distribution and demand-and-supplybottlenecks. Theretail and entertainment industries with their accessible examples have rooted much of the long-tail debatein the marketplaces we recognize and understand books, music, movies, second-handbooks, etcTwo, examples of the application of long tail thinking in advertising are the twinapproaches taken byGoogle. With its AdWords programme, Google is tapping not the mega-advertisers but advertisers of anysort and size even you and me. For as little as one US cent, any one of us can place an

onlineadvertisement on a site anywhere in the world.Google s AdSense programme on the other hand is democratizing media. You don t have tobe a media


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conglomerate to make money by displaying ads - a simple humble blog will do. All youhave to do is signup with Google AdSense, and revenue from your blog could also be featuring on your taxreturns.In my humble opinion, these two early examples have stunted further thinking about longtail applicationsin advertising and brand building. But that is the peril of mistaking the long tail to be anabsolute andsingular term. The world around us is an overlapping series of thousands of long tails some of which havebeen discovered and exploited, but a majority of which are yet to be discovered.And finally, most of the principles of brand-building were formulated at a time when massmedia with itshit-driven economics was at its prime. Its purveyors took the scarcity of media and limitedexposure timefor granted for they couldn t even fathom a world of media abundance and audiencefragmentation.Built on the foundation of scarcity and how to deal with it, these principles have nowbecome ingrainedinto our thinking and practice. So much so that we don t see the scarcity and distributionbottlenecks as aproblem mostly we don t even realize there are there.As an industry we are also accustomed to the idea of repetition as a device of persuasion.So when we are offered abundant choices in distribution channels and bandwidth, ourconditioned response is to repeat the same message (optimized for a 15 second slot) many

times over. After all, the more number of times the consumer gets tolisten/see/read/experience a message, the more strongly he will associate it with thebrand, right?Lord Saatchi s One Word Equity is the worst of these excesses (think of the irony of it.) Byreducing the carrier package to just one word, it ostensibly reduces errors intransmission. But what it also does is effectively multiply the available bandwidthmanifold think one word passing through a distribution channel optimized for the 25words in a 15 second commercial or a press ad. The result? An effective multiplication of the media budget and more mind-numbing repetition. An early example of long tailthinking in brand-building is a model named Tran media planning pioneered by a Londonplanner, Faris Yakob. Recognizing that different media don t have to repeat the samemessage endlessly, Faris recommends using different media to tell different parts of thestory. These individual mosaics of the brand story will then be assembled by the consumerin his mind, thereby allowing a riche

r, layered and interesting story to be communicated. As Faris points out, the advertisingfor Matrix (the movie) implemented this thinking.Transmedia planning elongates the tail of brands by using the increased channelbandwidth available to populate it with more than one message. But it stills refuses to

forego the single minded brand proposition, which is the overarching brand story it attempts to narrate. And you can t go very much further down the tail, if you insist onpeddling one product only.Long live the single-minded brand proposition


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In The Long Tail, Chris Anderson writes that the hit-driven media and entertainment culture of the second half of the twentieth century can be defined by these characteri

A desperate search for one-size-fits-all products Trying to predict demand Pulling misses off the market Limited choice

For anyone who has ever worked in advertising, the above should definitely sound veryfamiliar. Try replacing products with brand ideas and have a look at it again.We seldom think of the brand ideas and advertising we create as something we sell but that indeed is what we do. Consumers pay for it with their time and attention, and whenthe price or the benefit is not what they are seeking, they tune it out. We have a no saleand the gigantic universal spam counter registers yet another click. In creating andpeddling our wares we also use the very same devices and tricks that the media andentertainment industry have perfected in the last century. We use pre-filtering asmechanism to predict and decide what will have mass appeal. We choose betweenalternatives only allowing one brand idea at a time to make it the expensive shelf space . We pull off air any brand idea that doesn t connect with all of our identifiedconsumers even if it has its own small niche of buyers. Whether we realize it or not, wehave been dancing forever to the tunes of shelf-space scarcity and distributionbottlenecks. While all the while believing self-righteously that the single-minded brandproposition is the only right way to build a brand in any situation. Even in current times of abundance abundant shelf space (for brand ideas), abundant distribution (in mediachannels and bandwidth) and abundant choice (of brand propositions tailor-made foreach of your niche audiences.) So what s the option?Chris Anderson summaries what to do, not just for the world of brands but for anyone

staring at a long tail wild west. In scarce markets, you ve got to guess at what will sell. Inabundant markets, you can simply throw everything out there and see what happens,letting the market sort it all out. And here he s elaborating further. The more abundant the storage and distribution, the less discriminating you have to be in how you use it.In short, the application of the first principles of long tail thinking to brand-building yieldsan essentialtruth one more in harmony with the way the world works than with the artificialconstruct of advertisingand brand building.There s nothing sacrosanct about the single-minded brand proposition. In fact, in marketsof abundance it isthe wrong strategy to follow. In these markets, it makes sense to make available in themarket every singleproposition your brand can and should stand for.The long tail of brand buildingIn effect, the communication for every brand represents an individual market in whichdifferent messagesfor that brand compete for consumer attention and time. Largely due to the scarcity andexpense of media,contemporary brand-building models advocate pre-filtering what goes on the limited andexpensive shelf space of media.To ensure maximum bang for our buck, traditional brand-building models also advocatefocusing on onlyone brand idea called the single-minded brand proposition. Which made in sense intimes of mass mediadominance, given the economics of the situation. If you couldn t speak much or if it wastoo expensive to

speak, do speak about one thing only. And just ensure that it gets across.12F ig 2. Truncated brand communication curve.


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Traditional brand-building advocates artificially truncating the curve at the head to makethe economics work.Since everything especially the entire advertising budget rode on it, arriving at thecorrect brandproposition was a task of infinite magnitude. Some brands spend millions on researchand on employingthe best professionals to ensure that as many people consume what s on offer by payingwith their timeand attention. In short, the advertising agency s task was to engineer a hit a task madeinfinitely moredifficult because there is only one product to get it right and there is no way to hedge one sbets.But what of the other equally viable brand ideas for the same brand? They probably can t end up as hitsand attract audiences by the millions, but they too can have their own niche audiences numbering in thethousands, hundreds, tens or even ones and twos. But the harsh economics of a hit-drivenworld mean that there s no place for them.On the other hand, a healthy and complete long tail of brand-building would look something like this.F igure 3. A healthy and complete long tail of the brand. The primary proposition stills drawsthe hits.B ut abundant shelf-space and low distribution costs enable the brand to connect with every niche idea

with its own set of loyal consumers.The task of the advertising agency here is to generate all the myriad communicationmessages with whichpeople could relate to a brand and create communication for them all. (They will definitelyneed to help topull this off, but we ll come to that in a little while.)13Of course, the streamlined and aerodynamic economics of mass media would still meanthat one brandproposition may have to lead the overall communication. But no longer should it beallowed to dominate allthe communication for the brand.The fragmentation and abundance of media has now helped lower the barriers toconnecting the supply anddemand of more brand messages theoretically of all possible brand messages.For eg, Volvo s primary brand proposition could continue to be safety. But if there repeople out there whorelate to it as a stylish car, you can create communication tailor-made for them.Simultaneously, anotherbunch of people might actually like a Volvo for its European-ness. No longer will they haveto ignore that connection and only seek safety in Volvos.As Chris Anderson puts it, Long tail businesses treat consumers as individuals, offeringmasscustomization as an alternative to mass market fare.Elongating the long tail for your brandIn theory, the long tail can extend up to infinity incorporating every possiblecommunication message for a

brand. In practice, there are considerations of cost and the brand communication curvewill have to bearbitrarily truncated at some point.


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But unlike traditional brand-building models, the truncation doesn t have to happen at thehead of thecurve. The tail can stretch much further from where it currently ends; and as technologyfinds more ways tolower distribution costs, the further it can be elongated.According to Chris Anderson, two imperatives summarize the secret to creating a thrivinglong tailbusiness. They are :1. Make everything available2. Help me find it.Here are some practical and simple steps that translate the above two rules to make yourbrandcommunication long tail a thriving marketplace of messages.1. Seek help in populating the curveNo matter how deep-pocketed a brand is, populating the entire long tail curve withcustomized messagesacross the spectrum can be the shortest and quickest way to bankruptcy.14So, it is imperative that one seeks help from other quarters preferably those who arewilling to work forpleasure and not for money. And as some brands like Apple have already discovered, thesefruitful sourcescan be your brand s fans amateur enthusiasts who are likely to embrace the idea of giving legitimacy andform to their word-of-mouth recommendations.

Chevy recently ran a contest in North America for consumers to create their owncommercials for ChevyTahoe, their most profitable model. An online micro-site provided participants all the rawvideo footagerequired participants could mix and match the material and assemble a commercial totheir own script. Infour weeks, the contest attracted more than 30,000 entries far more than can have beendone by a paidteam of experts, no matter how large.In the past few months, similar contests have become very popular the latest being theone for DoveBeauty Soap, where the winner of such a contest was aired during the Oscars broadcast.The emphasis of such tactics has been engaging the consumer rather than simply pushing a product.While it will tacticallybe necessary to choose a winner and reward her, the real value of these contests is theteeming mass of strategies, ideas and executions they create in a flash.Of course, only a minute percentage of these entries are even half-decent and thetemptation to pre-filterthem and present just a few can be overpowering.But in a long tail world, the real opportunity is not in pre-filtering what s available but inmakingeverything available to everybody. And providing the aggregated audience the tools tosort out what s goodfrom what s not (like Flickr does for photos with its folksonomy, for eg.)In its short lifespan, user generated content/advertising has already attracted its ownlegion of skeptics. A

common complaint against it is that people enter these contests only to show off to theirfamily andrelatives and there s no lasting merit in what they create. While that is essentially true,Wikipedia and the


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other UGM successes have already proven that reputation can be a powerful motivator if harnessed right.2. Time is a natural elongating-agent of a brand communication market Every single brand message used by a brand in the past is, by default, a resident of thelong tail of thebrand. Its glory days over, it has given way on the shelf to the current brand proposition of the day but it still exists, forgotten and archived.Making these brand messages simultaneously available in secondary media could be thequickest and most cost-effective way to elongate the brand communication curve. The longer the brand hasbeen in existence,15the longer the tail can potentially be. In effect, one is using the advertising funds utilized inthe past topopulate the curve today.For eg. one of the most popular IBM campaigns of all-time is Solutions for a small planet a campaignthat broke and was active in the mid-1990s (but one that is still fondly rememberedtoday.) As of now, thecampaign is history, gathering virtual dust even though it can still tug a few hearts andconsumers.Making this available probably as a microsite hosting the commercials and theassociated work willgive another gateway for contemporary consumers to discover and engage with the IBM

brand. Theseconsumers probably will number only in the hundreds or thousands compared to themillions who relateand engage with their current mass media campaign (What makes you special?) But theycome at anincremental cost of almost zero.And add these consumers with those that relate to the other campaigns that IBM has runover the last fewyears (including my personal favorite, The world s helpdesk ) and you have a market that can rival the hitsof the current main brand proposition. All at no cost at all.3. Recognise that ones and twos can add up to quite a fewIn The Long Tail, Chris Anderson writes To think that basically everything you put out there findsdemand is just odd. The reason it s odd is that we don t typically think in terms of one unit per quarter.When we think about traditional retail, we think about what s going to sell a lot.The economics of the long tail are very different from those of traditional hit-driveneconomics. Long tail markets leverage the abysmally low cost of shelf-space anddistribution to convert what were unprofitable customers, products and markets intoprofitable ones. These audiences of ones and twos (very often more than that) areconsumers who would have been lost to your advertising either because they don t relateto your current projected brand proposition or because it was too mass-market a fare forthem. By reducing the cost associated with customized communication with theseconsumers, the long tail effectively multiplies the potential audience for thecommunication of your brand. So what s an effective long tail strategy to adopt whilebuilding a brand? Recognizing the power of these niche audiences, the best strategy toadopt is to chart out all the niche audiences the brand potentially has and address each

one of them with the most cost-effective media mix and with their own tailor-madebrand message.In fact, in more mature long tail markets each niche market of the brand will have its ownclosed loop of communication tightly knit teams that live and breathe the idea in close


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conjunction with their audience, thereby incorporating feedback mechanisms into thevery process of creation. Then the brand and the niche audience will move in tandem,locked together not unlike a pair of salsa partners on the dance floor. And for a lucky (orcanny) brand manager, these closed loop communication teams can actually be prosumerbrand enthusiasts thereby eliminating the need for an advertising budget.4. Employ recommendation and word-of-mouth for your brand-building effortsWhile there has been great focus on generating word-of-mouth for brands, I believe therehas been insufficient understanding or desire to do the same for the brand messagesthemselves. (A notable exception is the Crispin, Porter & Bogusky school of brand-buildingthat has thrived on creating ever expanding ripples of word-of-mouth around theiradvertising.) The most powerful effects of the long tail were first noticed when Amazon srecommendation filters pointed consumers to books that they might like calculatedbased on the behavior of other shoppers like them. With recommendation filters,consumers found books they were interested in and Amazon sold more books from thetail of the curve. The stuff in the long tail is useful only if it can find its way to yourconsuming audience. While pre-filtering tries to predict demand (a process not without itsown risks), recommendations and other post-filters amplify already existing behavior.Because the filters identify an existing pattern in behavior among the consumers of youradvertising (as distinct from the consumers of the brand), they are more likely to find asympathetic audience fit. Consumers of your advertising are also likely to respond torecommendations like these, because they understand that other consumer experiencesform the basis for them. And as we already know, consumers are much more likely to findother people s words more useful because they are perceived as not having a hiddenagenda. Recommendations also give the consumers of a brand s advertising a familiarplace to start and work their way through the maze of messages. Without

recommendation filters and the hits at the head of the curve, a long tail market risks beingtoo much noise and very littlesignal.Recommendations filters and behavior aggregators the tools to amplify thesecondary word of mouth around the brand messages themselves are also a convenient vehicle to create buzz around the brand itself. They effectively reduce the work aconsumer has to do from trying to explain why they like something to merely saying,

follow this link and have a look at this video.5. Don t try and predict. Measure and respond instead. It s a legacy of our hit-driveneconomy that we are continually engaged in trying to predict the likely success of ourchosen brand message being a hit. To this end, inordinate amounts of money and energyare spent. Often, all in vain. The opportunity a long tail market offers is to do away withthese expensive means of predicting demand. In a long tail brand communication, allpossible brand messages are simultaneously available in the market. Technology andmedia may not have grown sophisticated enough today to measure and analyses everysingle variable in consumption patterns, inclinations and tastes of an entire market in realtime. But there s lots more data available today in real time than was the case some timeago. Armed with this real-time data, all one needs to do then is to continually adjust andrespond in quick time, tweaking the messages or shuffling them around from thesidelines into centre-stage, if one is garnering significant hits and showing the potential tobecome a mass-media hit. The role of an advertising agency in this case shifts from being agatekeeper who decides on limited data and gut-feel which brand message will be asuccess. It becomes that of an active agent investing in the communication market of aparticular brand. Keeping a keen eye on the market and how a suite of messages arefaring, the agency keeps altering its portfolio of messages to ensure maximum returns forits clients.6. When you have infinite choice, context is more important than content For too longadvertisers and communicators have focused only on what they are saying and not enough on who they are speaking to and where the conversation is happening. And even

when they do so, they have almost always painted the picture with broad and all-encompassing brushstrokes. The economics of mass-media and a hit-driven industryensured that our individual differences were ignored and our collective similarities wereaddressed to. This gave rise to the artificial construct of popular culture where the


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conventional is critically enjoyed and the truly new is criticized with aversion. But asChris Anderson notes, Everyone of us no matter how mainstream we might think weare actually goes super-niche in some part of our lives.A plethora of brand messages and the corresponding post-filters to navigate them enablesour consumers to seek and find the message that best suits them in the current context they are in. The very same consumers will return to consume and relate to a different brand message, when the context changes either with time or with being in a different situation. The contextual effects of the long tail effectively ensure that consumer s buyingpatterns needn t always be rounded off to the nearest million.7. Build negative databases of your brand communication Negative databases are anexciting new field in information theory. They are finding application in securingcryptographic messages to building computer immune systems mimicking those of ourown. Unlike normal databases, negative databases keep track of characteristics that don t define something rather than those that define them. For eg., a negative database of a dogwill contain entries like wings , beak ,

feathers , etc essentially all characteristics the dog doesn t have.In a long tail communication market, while all messages are theoretically possible not allare practically compatible. Association with one sometimes means disassociation withanother its antonym. For eg., if Volvo stands for safety, it cannot then stand for

dangerous to drive. But it can be thrilling to drive .Traditional brand building ideas didn t distinguish between the latter two messages. If Volvo stood for safety, it didn t stand for anything else. Effectively the rest of the messageswere confined to the negative database bin without a thought. In a long tailcommunication market, the need will be to carefully create and fashion a negativedatabase of messages a minute subset of all possible messages that cannot work for the

brand.It is this negative database that ll guide you and help you identify which messages cannot and should not populate your brand communication curve.8. Trade control for influence.In the 1980s, when NASA was contemplating sending robot aircraft to the far reaches of the solar system, a group of scientists thought of a novel approach which they detailed in apaper called 'Fast, cheap and out of control : A robot invasion of the solar system'Traditional spacecraft are big, complex and are explicitly designed to be controlled by us.These design parameters result in an exponential increase in their cost, complexity andweight; and correspondingly decrease dramatically the probability of the success of themission.Instead, the new method proposed by this group of scientists was to send miniature botsin the hundreds or thousands. They would be cheap to make and launch. And since wedon't have to rely on only one to succeed dramatically well - they don't need to be built inwith fail-proof security and reliability (the real reason why they cost so much and take solong to build.) The Faustian bargain here is of relinquishing control. The bots would be ontheir own, only bothering to send back whatever they discover.There s lesson for advertising and brand-building in there. Traditional brand-building islike those lumbering robot crafts complicated and expensive, because we burden it withour do-or-do expectations of success. And with our overpowering need to control it and itsevery interaction and consequence. In my opinion, the future of advertising and brand-building will also be 'fast, cheap and out of control.'Unlike our tried and trusted mass media advertising that we can take off air , future mediavehicles will not come with an off switch. When we pay very little to run them, we areactually relinquishing our control over when, where, and how they will run. Effectivelythey are on their own. Examples of these persistent advertising vehicles are viral videosincreasingly hosted on publicly shared sites, podcasting, in-game advertising, on-linevirtual worlds, blogs, social networking sites, etc. These new media vehicles work in a

paradigm very different from the tried and tested ways of slow, expensive and in controladvertising. What all these media vehicles (and the ones to come) will do is embed ourbrand messages into the very fabric of our collective lives making them searchable ,

findable and experience-able for eternity. Your brand could have made a clean-cut with


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