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Trust can fortify brands against recession impact

Trust can fortify brands against recession impact
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First Published: Tue, Oct 20 2009. 09 47 PM IST

Clear calibration: Simon Bolton, chief executive officer of The Brand Union, says the opportunity in India is enormous and one area where he expects the company to grow is the consumer branding segmen
Clear calibration: Simon Bolton, chief executive officer of The Brand Union, says the opportunity in India is enormous and one area where he expects the company to grow is the consumer branding segmen
Updated: Tue, Oct 20 2009. 09 47 PM IST
Mumbai: The chief executive officer of The Brand Union, Simon Bolton, says India will attract a fair share of the company’s investments over the next two-three years, being a key growth market for it. The Brand Union is one of the world’s top three brand consulting and design firms. The company, part of the global marketing and communications firm WPP Group, is present in India as Ray+Keshavan/The Brand Union. WPP Group will look to increase its 51% stake in the Indian brand consulting and design firm to 74% by 2011. Edited excerpts:
Do you plan to increase your stake in Ray+Keshavan?
Clear calibration: Simon Bolton, chief executive officer of The Brand Union, says the opportunity in India is enormous and one area where he expects the company to grow is the consumer branding segment. Ashesh Shah / Mint
There are milestones in the whole acquisition and M&A (mergers and acquisition) programme, and, yes, we will definitely want to have a stronger position in the business. We will always want Sujata Keshavan (managing director and executive creative director) to have a share of the business because ownership is something that WPP feels very strongly about. The majority position is clear (WPP owns 51% in the brand design firm which is likely to go up to 74% by early 2011, according to Keshavan) and that’s important. Everything slowed at the beginning of the year, of course, but the market is completely ripe for this business.
Is design critical only to advertising, marketing and the communication space in an organization or does it have a larger role in the company’s strategy?
When you look at conglomerates, they need enormous help in figuring out their brand architecture—how does the brand dissipate as you go into new business areas, does diversification make sense.
In India, when I first came across Kingfisher, it was just a beer brand. And you think, gosh, can a beer translate to an airline? What’s the relationship and to what degree can you stretch the brand? It’s only when you make that stretch properly does it make sense.
So, we don’t look at the world starting from a design point of view. We start with “what is the brand world we want to create”. We think of a 360 (degree) approach that goes beyond just the logo:—what are the new business areas, how do you present yourself outside, the identity on your business card and brand engagement. What one is trying to do is to get the employees to “sweat the brand”.
How do you calculate return on investment on branding and design?
Increasingly we are using the Millward Brown and WPP “BrandZ” model which does a very clear calibration of the brand’s worth based on a combination of unique research, asset value and business performance. At the corporate level, we do some degree of brand valuation. (Millward Brown is a research company under the WPP Group with expertise spanning communications assessment, media evaluation and brand performance monitoring. BrandZ is a study of brands that helps maximize the rate of return on brand investments.)
With one of our large packaging clients, we’re working on a shopping experience programme in key markets which track a change in sales depending on how often you change your packaging format and the functionality of that form. It’s definitely something that WPP will be bringing to this market. Ten years ago, it was all judgement and now there’s a validation process going on. It will only get more sophisticated as people look for the proof points on the investment you took from them.
You say that economic recession is inevitable but brand recession need not be. Could you explain?
There are economic cycles taking place in the world, but brands can fortify themselves against some of that impact. People have brands that they hold close to their hearts. So if they have 100 brands in their repertoire, they will forsake a lot of those during tough times. But some they won’t, because there is trust. For example, I will always carry my American Express card, which I’ve had for over 20 years. It is my piece of security no matter what.
On the other hand, I have changed my travel insurance firms many, many times because there are a lot of trust issues around them.
So it is about building that strong relationship with your consumer.
What is your favourite piece of work?
Some of the work we have done for Vodafone (Group Plc.) is tremendously exciting. Vodafone moved away from that period when it was just acquiring companies and trying to get its big red branding all over the place, to developing energy and sophistication into the brand. It launched a home music service. My daughter is 17, and she is now interested in Vodafone for the first time, because it has proper music downloads, it’s sponsoring some of the artistes, running rock concerts, some of them virtual, some online, some through its networking services, finding ways of releasing music earlier. So there’s a whole engagement process with a customer group it had been missing out on.
What are your plans for India?
Our development in the Indian subcontinent will be through Ray+Keshavan.
The opportunity is enormous. We will look at destination business coming into India as well as big Western consumer branding companies who are ambitious in developing a market share here.
An area we expect to grow our strength in is consumer branding—so packaging, brand manifestation work, point of sale and territory work around consumer brands will be priorities.
gouri.s@livemint.com
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First Published: Tue, Oct 20 2009. 09 47 PM IST