Report on How do Consumers Choose Brands

A report submitted for internal assessment of Brand Management

Prepared By


How do consumers choose brands?
The choice of brands depends on various factors both internal and external. 1.Demographic ² Geographic ² Psychographic 2.Social Class 3.Family Life Cycle 4.Reference Groups & Family Influences 5.Internal Factors ² Perception , Attitude, Personality These major factors influence a consumer to choose the brand. Buying Behaviour is influenced by 1.Price 2.Free- Discounts- Sale 3.Visual Appeal- Packaging 4.Bundling 5.Just noticeable difference 6.Point of difference 7.Day ² 2 ² Day Remedies 8.Features ² Benefits - Attributes 9.Umbrella Brands 10.Brand Name ² Jingles - Logo 11.Consideration Set 12.Brand Ambassdors 13.Instant Easy to use ready made 14.Health Related products

Six of Fortune's 2006 Most Admired Companies price their products as follows: 1. 2. 3. 4. 5. 6. Starbucks Southwest Airlines Fedex Dell P&G Toyota ´Highly-Expensiveµ ´Low-Pricedµ ´Highly-Expensiveµ ´Low-Pricedµ ´Highly-Expensiveµ ´Low-Pricedµ & ´Highly Expensiveµ

Toyota wants to sell cheap stuff to attract economic buyers. But, they also want to sell luxurious stuff to grab rich buyers. Toyota saw good opportunities in both. Toyota sells their trucks and cars on the lower-end under their parent brand name. For luxury cars they sell under a different brand ´Lexusµ. Now, if Toyota sells their Lexus line under the "Toyota" brand name, they'll send messed-up signals to consumers. As, people associate symbols with certain brands using their pricing structures. It is because of the pricier buyers, who are infatuated with the status a rich brand name brings. When Buyer Bill buys a rs150,000 Porsche 911 Turbo, he doesn't want his car to be associated with a rs12,000 automobile. If it does, he'll seek another brand name that will comfort him with the exclusivity he wants. If a company is targeting two different markets, they should distinguish their luxury products from the cheaper ones as much as possible

2.0.Offers & Discounts

Offering items at a sale price is a very tempting tactic. In the short term, it drives traffic and sales. What the
company loses in margin is made up in volume. This may result in a new set of problem. In reality the company is eroding their long-term margins and their long-term sales. This is especially true if the company you run a business based on quality and value versus being a low-price provider. The problem with discounts is that customers don't see the price drop the same way the company do. The moment the company discount, the customer re-calibrates the perceived value of products/services. Selling something for rs 200 today, and discounting for rs150 tells the customer that the company is making more money on the rs200 version and still making money on the rs150 version; so the rs200 version was overpriced. The new perceived value is rs150.

Starbucks Coffee used to host their Annual Brewing Sale at the stores. Each spring they would put coffee and espresso machines on sale. "Lowest Prices of the Year!" the signage declared. The customer would save between rs50 to rs200 on a brewing machine. So instead of being priced at rs250, the brewer was on sale for rs200. Instead of being rs700, the automated espresso machine would be rs500. The customer perception changes, if Starbucks could sell items for the lower price of rs200 and rs500 that must be their value. Customers stopped buying year-round and waited to buy ONLY when Starbucks had the sale. While the ring of the cash register sounded good, Starbucks made no more money in the rush of machines sold at SALE prices than they did selling them at a fixed prices all year. To counter the above mentioned problem, instead of giving away money, strategically provide add-on services or products. Instead of discounting the price of a hair cut at the salon, give away a bottle of that great shampoo that made customer·s head tingle and hair smell so great.

This accomplishes two things; 1. We don't erode the cost of the base product. 2. We have created a strategic win-win. The customer feel good for receiving something of extra value and as a business, we got the customer to try something new. The customer may start buying that shampoo on a regular basis. Discounting lowers the perceived value of your offerings, and in the long run erodes your brand. Once you start offering discounts, the only way to get that rush the next time, is to discount more. If this cycle continues, your margin is gone, your prices are bargain basement, and your brand has reduced value.

Exchange Culture in india
As Indian's we hold a lot of value for the 'old', maybe it is also culturally driven where we have been asked to respect 'old' rather than look for new. Though this is changing very fast especially among the younger generation of consumers, but it will take a lot of time before we actually catch up with our western counter parts Most of us have an uncle who would proudly show of his old watch, " I have been using this watch for the last 30 years , this was gifted to me when I was in class 10" . This is a nightmare come true for a marketer, if every consumer were to use his watch for eternity then...... Similarly most housewives collect the used containers of flour, ghee ,,, which she would clean and use it to store cereals , and other items in the kitchen and so on till it is sold to the scrap dealer .

3.0.Visual Appeal Packing
How packaging helps to establish the Cadbury brand identity

Design is very important in all areas of life. Consumers are becoming more design conscious and expect a box of chocolates to look as good as it tastes!

Cadbury has always been at the forefront of packaging design and brand development and recognizes only too well the importance of this in retaining its leading position in its marketplace. Consumers can continue to observe its ongoing investment in innovative packaging design with each new product launch and each new change made to the packaging of existing design.

The role of Cadbury·s packaging

Cadbury·s packaging must be able to perform both a functional and marketing role:
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On a functional level the pack must be structurally sound to protect the product Quality in distribution and storage conditions. At a marketing level, however, it should be attractive to look at and handle, communicating to consumers the essence of the Cadbury brand identity.

Colors and Designs

Research continues to show that consumers will purchase what they "want" far more rapidly than what they "need". Most of us will admit to having, at some point, delayed purchasing something that we needed, so that we could buy something that we "wanted" today. Visual appeal can, and does, play a significant role in creating a desire to purchase a product or service today.

Packing ² Easy to store & Easy to Use
If it is packaged attractively then the consumer will not worry about the cost!

If it is a business to consumer product and especially a fast moving consumer good or a snack or a soft drink, packaging has got to do something with the way consumer sees it. There are some seeds of perception that are planted into the consumers mind when the idea of packaging evolves for these kinds of products. Let say for example there is a new lime fresh perfume, what should the bottle or the packaging look like? The tagline is lemony lime fresh and the bottle is a deep purple colour. The very first look of this combination puts a doubt in the consumer's mind that is looking for a fresh scented perfume, that this might not be the one. On the other hand if it were in a lime green colour bottle, people automatically associate it with the freshness.


Microsoft Corporation dominates about 90% of the operating system market with Windows, the most popular operating system in the computer industry. Also, Microsoft controls 75% of the market ´productivity application softwareµ including word processors, spread sheets, and databases. Microsoft used a clever strategy to bundle all the PC productive software namely, Word, Excel, Power Point and Access as a suite called ´Officeµ. The price of the office is less than half of the prices of different component separately. In this way, Microsoft stole the market share from Lotus and Word Perfect and as a matter of fact , this strategy has made Microsoft a big dominant firm in the software market.

5.0.Features Benefits & Attributes
Associating a product with an attribute, a product feature or a consumer feature. Sometimes a product can be positioned in terms of two or more attributes simultaneously. The price/ quality attribute dimension is commonly used for positioning the products. A common approach is setting the brand apart from competitors on the basis of the specific characteristics or benefits offered. Sometimes a product may be positioned on more than one product benefit. Marketers attempt to identify salient attributes (those that are important to consumers and are the basis for making a purchase decision) Consider the example of Ariel that offers a specific benefit of cleaning even the dirtiest of clothes because of the micro cleaning system in the product.

Colgate offers benefits of preventing cavity and fresh breath.


Promise, Balsara·s toothpaste,

could break Colgate·s stronghold by being the first to claim that it contained clove, which differentiated it from the leader.


Nirma offered the benefit of low

price over Hindustan Lever·s Surf to become a success.

Maruti Suzuki offers benefits of maximum fuel efficiency and safety over its competitors. This strategy helped it to get 60% of the Indian automobile market.
Sony ² Technology & Quaity

7.0.Just Noticeable Difference
Just Noticeable Difference is the minimal apparent difference between two products as observed by the consumer. Otherwise we can say -"The just noticeable difference (JND) is the smallest difference in intensity between two stimuli that a person can detect."
Psychological concept applied to consumers' purchasing patterns that holds that consumers are more likely to purchase products based on the perceived differences between products than they are to purchase based on the attributes of one product or another. In marketing there are two valuable concepts to follow. However, they sometimes use indiscernible stimuli that are just below a consumer·s threshold so as to influence him. This is called subliminal message.

For e.g. If an unbranded detergent cost 5 percent less that consumer is regular brand, the consumer ma not notice the difference. However, if the same unbranded product costs less than 30 percent less than he is definitely going to notice the difference.
Weber·s Law states that the stronger the stimulus, The greater the change required for the stimulus to be seen as different. The most important application of this law is in price. One critical implication is that the higher the original price of an item, the greater the markdown required to increase sales. For e.g. If price of a Mercedes Benz S class is reduced by 25000/-, it will not have any impact on sales because the basic price is in several Lakhs that a difference of Rs25000/- may not be noticeable for consumers. On the other hand a price reduction of even Rs5000/- for a Maruti 800 is

seen to push sales substantially because of its low original price. Another example, if the price of a car is increased by Rs.1000/-/- it would probably not be noticed i.e., the increment would fall below the J.N.D. it may take an increase of Rs.5000/-/- or more before a differential in price would be noticed. However even an one rupee increase in oil price would be noticed very quickly because it is a significant percentage of the initial amount So an additional level of stimuli equivalent to the J.N.D. must be added for the majority of people to perceive a difference between resulting stimulus and the initial stimulus.

8.0.Cathy Name ² Mantra ² Jingles
A brand is a name, term, sign, symbol or design or a combination of theory intended to identify the goods and services of one seller or group of sellers and to differentiate them form those of competitors. Brand identifies the seller or maker. A brand is essentially a seller's promise to deliver a specific set of features, benefit and services consistent to the buyers. A tagline is one of the most cost effective ways to express the value of a brand. The advertisers of the past knew the art of the tagline and spent time, money, and research in developing a short and easy way to communicate a brand message. Eg., Big Bazaar : ´Isse sasta aura cha kani nahinµ

Now a days, brand managers are using the taglines effectively to redefine the brand abbreviations. LG the name born out of the abbreviation of Lucky Goldstar is now associating its tagline ´Life·s Goodµ with the letters LG. HP uses the tagline ´Hit Printµ in its recent ad campaign for its print business.

Brands and memorable jingle!

Even today, with multiple interactive avenues in advertising, role of jingle is unquestionable.. Though jingles started for radio advertising, they still form an important part of marketing mix even in age of online gaming. Jingle of Parachute oil ² ´Pyaar mein« Gorgeous Hamesha·µ was not just aired on TV and radio, was hosted on their website, on portals, on

YouTube and hosted as ringtones across many sites. On Reliance Mobile World, this jingle was deployed under the Romantic Hits category. I have heard my friends listen to this time an again on their laptop! As a country, we not only love pleasant and soothing tunes, but even voices of our actors and actresses, and any brand that uses a famous celebrity voice to promote its products has met with success. Amitabh Bachhan, Naseeruddhin Shah and others have been famous not only for acting, but even for amazing voice quality! Jingles which were melody based, with the brand name mentioned multiple times increased brand recall and became a synonym for the industry. Am linking some amazing, old and new jingles with their Brands«do add links for others incase you find them. These brands are best remembered for their music! Enjoy!!!

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Britanni Hamara Bajaj Nirma Airtel Titan watches Vicco Tumeric cream Frooti

9.0.Point Of Parity & Point of Difference
Points of Difference & Points of Parity Point of difference (POD) is a term used for an outcome of product differentiation. In business economics, differentiation is seen as an important strategic move for companies to make. Because of an overwhelming variety of products and services on the market, those that stand out in some manner are better noticed by consumers. There are various (positive and negative) ways of being different compared to competitors in the same market. Differentiation is the term given to the positive way in which a company's product differs from its competitors. Points of difference (PODs) describe the individual factors of differentiation.

The key points of difference of a company are synonymous with its unique selling proposition (USP), and are critical in defining its competitive advantage and branding strategy. They must be attributes or benefits that consumers strongly, uniquely, and positively associate with the company's brand; and not with any competing brand. Once points of difference have been clearly communicated to consumers, the company and its brand are set apart from its competitors. Brand loyalty depends upon the ability of the company to establish and maintain clarity of communication with the consumer regarding their brand; and to maintain and expand the points of difference that defines the brand.
Points-of-parity (POP) are driven by the needs of category membership to create category of POPs and the necessity of negating competitors· Points of Difference (POD) to create competitive POPs. In choosing pointsof-difference, two important considerations are that consumers find the POD desirable and that the firm has the capabilities to deliver on the POD. There are three key consumer desirability criteria for PODs, 1.Relevance: Target consumers must find the POD personally relevant and important. The Westin Stamford hotel in Singapore advertised that it was the world·s tallest hotel, but a hotel·s height is not important to many tourists. 2.Distinctiveness: Target consumers must find the POD distinctive and superior. When entering a category where there are established brands, the challenge is to find a viable basis for differentiation. Splenda sugar substitute

overtook Equal and Sweet ¶n Low to become the leader in its category in 2003 by differentiating itself on its authenticity as a product derived from sugar, without any of the associated drawbacks.
3.Believability: Target consumers must find the POD believable and credible. A brand must offer a compelling reason for choosing it over the other options. Mountain Dew may argue that it is more energizing than other soft drinks and support this claim by noting that it has a higher level of caffeine. Chanel No. 5 perfume may claim to be the quintessential elegant French perfume and support this claim by noting the long association between Chanel and haute coutre. There are three key deliverability criteria. 1.Feasibility: 2.Communicability: 3.Sustainability:

Marketers must decide at which level (s) to anchor the brand·s points²ofdifferences. At the lowest level are brand attributes, at the next level are the brand·s benefits, and at the top are the brand·s values. Thus marketers of Dove soap can talk about its attribute of one-quarter cleansing cream; or its benefit of softer skin; or its value, being more attractive. Attributes are typically the least desirable level to position. First, the buyer is more interested in benefits. Second, competitors can easily copy attributes. Third, the current attributes may become less desirable. Research has shown, however, that brands can sometimes be successfully differentiated on seemingly irrelevant attributes if consumers infer the proper benefit. Procter & Gamble differentiates its Folger·s instant coffee by its ´flaked coffee crystals, ´created through a ´unique patented process. In reality, the shape of the coffee particles is irrelevant because the crystals immediately dissolve in the hot water. Saying that a brand of coffee is ´mountain grown is irrelevant because most coffee is mountain grown.

Family branding is a marketing strategy that involves selling several related products under one brand name. Family branding is also known as umbrella branding. It contrasts with individual product branding, in which each product in a portfolio is given a unique brand name and identity.

There are often economies of scope associated with family branding since several products can be efficiently promoted with a single advertisement or campaign. Family branding facilitates new product introductions by evoking a familiar brand name, which can lead to trial purchase, product acceptance, or other advantages.

Family branding imposes on the brand owner a greater burden to maintain consistent quality. If the quality of one product in the brand family is compromised, it could impact on the reputation of all the others. For this reason family branding is generally limited to product lines that consist of products of similar quality.

Airtel Limited

Branding is the in-thing today as anything goes branded, from salt, to eggs even chicken are packed on cellophane with manufacturer's or distributors name or label. Generics products are unbranded, plainly packaged, less expensive versions of common products such as paper, towels, spaghetti, salt etc. which were offered at lower quality or standard and price at as much as 20% to 40% lower than advertised brand. This lower price is made possible by lower quality ingredients, lower cost labelling and packaging and minimal advertising Branding helps the segment markets. The seller can offer the same generic product in different brand names e.g Procter & Gamble sells a simple detergent in eight different brands each formulated differently and aimed at specific benefit seeking segments.


11.Consideration Set

Consideration set is the subset of brands that consumers evaluate when making a purchase decision. A consumer has a limited information processing abilities and limits the comparison to a subset of brands that is termed as consideration set. In the frequent purchased product category such as groceries, consumers mostly face information overload and may engage in strategies to minimize the cost of information search (utility comparison or cost-benefit trade-off). Also, frequent purchased products are characterized by frequent price promotion of varying depths of discounts; a consumer faces significant uncertainty about the prices of brands. Consumers may limit their attention and evaluation to a subset of available brands to simplify the purchase decision.

13.Brand Ambassadors
Advertising is always keen to take the less risky route of Brand Ambassadors to endorse. These ambassadors would differentiate and influence the brand. Product categories and numbers are even on the rise and differentiation has become tough, for marketers. Believable rarity and ambassadors are one easy way to achieve it. Most of the Researches reveal that customers are more likely to buy products and services, which are endorsed by the celebrities than those with out them. But for differentiation to be successful there must be an element of differentiation. The effectiveness of differentiation is not maximized, unless the selected brand ambassador stands above the rest in the minds of the customer and offers a significant point of difference form his or her peers. These people attract the attention and provide instant recognition to the brand. They posses some qualities, which are considered to be dynamic, for this reason celebrities have to be used imaginatively and cautiously. Even celebrities make commodities look smart and elegant. The increase in the product sales and brand image would certainly depend on the credibility and image of the brand endorser. Brands ride on the celebrity appeal, credibility and get some of the positive image transferred to it. No doubt Credibility of the ambassador is the most important aspect in that would influence the success of the campaign.

Attractiveness of the celebrity would help the brand by having a positive impact on the customer evaluation of the product. Even there are cases where endorsers may not make any impact at all. Brand uniqueness is the most important positive feature to a company or organization and is the face of a company. If Brand positioning is done correctly it can propel the business to new heights. Thus, positioning a brand is very important in terms of gaining people·s confidence and winning the brand race. For this brand ambassadors are of great help in positioning a brand.

13.Day to day Remedies

OTC Market in India
Over-the-counter (OTC) drugs are medicines that may be sold without a prescription, in contrast to prescription drugs. These items can be found on the shelves of grocery/ cosmetic stores and bought like any other packaged product in some countries or in others may be bought "over the counter" from the pharmacy, while prescription drugs are sold at a pharmacy counter.

Moov -Iodex

There are different categories under OTC, out of which here is a list of categories which have spent maximum in brand building through on TV are as follows: 1. Rubs/ Balm - Moov, Iodex, Himani Fast Relief, Emami Mentho Plus, Amrujanjan Joint Ache Cream 2. Analgesic/ Cold Tablet - Dcold, Stopache, Crocin, Disprin 3. Digestives - Eno, Hajmola, Pudin Hara, Dabur Hingoli 4. Medicated Skin Treatment - Itch Guard, Krack, Ringguard, Clearasil 5. Cough Lozenges - Strepsils, Halls 6. Vitamin/ Tonic/ Heath Suppliments - Horlicks, Complan, Boost, Chawanprash - Dabur, Sona Chandi, Himalaya, Calcium Sandoz, Jeevanprash 7. Antiseptic Cream/ Liquids - Borosoft, Boroplus, Dettol 8.'Cipla I-Pill' a new brand was the most advertised brand on TV during JanuarySeptember 2007.



A variety of societal factors are driving consumers to increasingly seek out unique and differentiated products that fit their lifestyle. Consumers purchase of green or sustainable organic products are not just motivated by the produces themselves but by the values they represent. We can change non-organic consumers minds to make them believe that organic products are better in different ways-for the taste, health or the environment and demonstrate that people who are important to them, whether it¶s people who are related or not, such as celebrities, if they buy and consume organic product, then we might be able to move these consumers into the organic market.


Multi grain bread ² atta ² biscuit

Sugar free

Horlicks Lite

Women·s Horlicks

15.Instant ² Fast to cook Good to eat !
Instant Food/meals is one of the fastest growing segments with the changing lifestyles and growing number of nuclear families, which actually reflects the buoyant growth expected in the coming future. The complexities of urban life have greatly encouraged the emergence of the class of foods called Ready-to-eat (RTE) and Ready-tocook (RTC). Foods that fall in the rapidly expanding RTE category include p r e - c o o k e d non-vegetarian and vegetarian preparations, microwavable meals, frozen nonvegetarian and vegetarian foods. However, while the development of the segment has made regional favourites, such as Chettinad Chicken and available to consumers across the country.

Maggie Instant & Pasta

Kitchen of india & MTR

Kissan sauces/jam