S. Ramesh Kumar - Consumer Behaviour & Branding Concepts Readings & Cases-Pearson Education (2014)

Consumer Behaviour and Branding
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Concepts, Readings and Cases
The Indian Context
S. Ramesh Kumar
Professor of Marketing
Indian Institute of Management Bangalore
Bangalore
Chennai • Delhi • Chandigarh

This book is intended for marketing students and practitioners interested in knowing the
conceptual aspects of the fundamentals in marketing. Various brands have been cited as
examples to explain these concepts. While the brands have been shown in a positive manner,
academic interpretation of the examples linked with the concepts is not intended to support or
malign the handling of product and brand strategies. All references pertaining to public
domain information have been provided wherever appropriate, and brand advertisements
have been reproduced with due permission from the respective companies.
All brand and product names are trademarks or registered trademarks of their respective
holders. All rights with respect to those trademarks or registered trademarks are reserved by
their respective holders.
Copyright © 2009 Dorling Kindersley (India) Pvt. Ltd.

Licensees of Pearson Education in South Asia
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prior written consent.
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ISBN 9788131722367
eISBN 9789332500815
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The consumer is king (or queen) when it comes to branding. Accordingly, mar-
keters must have a keen understanding of how consumers think and feel about
brands, and shop for and use their products. Consumer Behaviour and Branding
by Professor Ramesh Kumar provides the very best, up-to-date thinking on these
critically important topics.
Kevin Lane Keller

E.B. Osborn Professor of Marketing
Tuck School of Business
The size, the heterogeneity and the diverse cultures prevalent in our vast country
present an exciting but formidable challenge for the formulation of any market-
ing strategy. Each customer segment (and there are many) expects to be offered a
unique value proposition to facilitate a bonding with the brand. Professor Ramesh
Kumar's treatise emphasizes the need for a conceptual and more importantly, a
contextual approach in the formulation of such marketing strategies. One size
does not fit all and there are different strokes for different folks. It is more of a
manual for all practicing marketing managers to understand these complexities –
a book they cannot do without.
Bhaskar Bhat
Managing Director
Titan Industries
Contents
Preface xiii
Introduction: Why Concepts Are Important in the Indian Context 3
Importance of Cultural Dimensions 5
Importance of Timing 7
Challenges in Emerging Markets 8
Challenges for Marketers 10
Options Available to Branded Offerings 11
PART I CONCEPTS IN CONSUMER BEHAVIOUR 15

Chapter 1: Linkages Between Concepts and the Indian
Marketing Reality 17
The Experiential Approach to Branding 17
Consumers and Contextual Creativity 20
Marketing Myopia as a Classic Strategy 23
Consumer Perception and Marketing Strategies 25
Branding Commodities—Conceptual Linkages 28
Price Discounting and Sales Promotion—Its Implications 32
Perceived Risk and Branding 34
The Power of Brand Associations 38
The Enigma of the Three C's—Culture, Cricket and Consumers 41
Hedonism—The Universal Marketing Appeal 44
Variety—Marketer's Dilemma or Consumer's Confusion 47
Approaches to Consumer Buying Behaviour 50
Challenges of Customer Satisfaction, Loyalty and Migration 53
Opinion Leaders as Thought Leaders 55
Conceptualizing Glamour—Celebrity Advertising as a
Branding Strategy 58
Exploring the Consumer Lifecycle 60
viii Contents
Chapter 2: The Importance of Consumer Behaviour Towards

Brand Success 65
Behavioural Dimensions of Marketing 65
Consumer Behaviour and Brand Success 70
Touch of Reality 75
The Digital Connection with Consumer Behaviour 75
Coffee and Consumers 76
Diversity and Importance of Consumer Needs in an Emerging Market 77
Consumer Behaviour and Marketing Strategy 78
Captive Consumers 78
It Is Consumer Behaviour all the Way 79
Chapter 3: Consumer Decision Making and Branding Strategies 81

Consumer Decision Making: Important Dimensions 81
Strategies of Applying Consumer Decision Making 96
Consumers, Shopping Styles and Brands 106
Touch of Reality 110
Differentiating Involvement Levels 110
Degrees of Information Search 110
Chapter 4: The Concept of Perception and Its Impact

on Marketing Strategies 113
The Concept of Brand Re-positioning 125
Developing Brand Differentiations 134
Perception and Technological Products 138
The Process of Branding Hi-tech Products 140
India's Macho Motorbike 146
Chapter 5: Learning Principles and Their Usefulness to

Branding Associations 147
The Concept of Conditioning 147
Building Relationship Programs 152
Old Brands and New Communication – Applying Learning Theories 163
Strengths of Brand Associations 164
Chapter 6: The Role of Motivation and Personality Dimensions

in Brand Associations 165
Multiplicity of Needs 166
Brand Personality and Self Concepts 178
Chapter 7: Attitudes and Their Impact on Branding Strategies 179

Linkages in Attitude Formation 179
Contents ix
Marketing Implications 180

How are Attitudes Formed 182
Role of Beliefs in Attitude Formation 183
Types of Influence on Attitude Formation 183
The Elaboration Likelihood Model (ELM) 192
Attitudes Matter in an Emerging Market 195
Caselet 197
Attitudinal Linkages to New Product Category Creation: Attitudes
and “Aftershower” 197
Chapter 8: Diffusion of Innovation: The Acceptance of

New Products and Brands 209
Defining “New” Products 209
Dimensions of Brand Diffusion 221
Why Do Brands Fail? 225
Branding the Unknown—Strategies for “Small” Brands 227
Barrier Breakers: An Application of the Concept of Diffusion of
Innovation 230
Price Matters, but It Is not the Only Factor 235
Diffusion in Emerging Markets—From Functionality to Glamour 236
Technologies, Company Strategies, Consumer Appeal and Diffusion 236
Chapter 9: The Concept of Reference Groups and Their

Implications on Branding 239
Types of Reference Groups 239
Reference Groups as a Powerful Source of Influence 241
Celebrity Usage and Their Impact 245
WOM and Perceived Risks 251
The Triad Route to Celebrities and Brand Associations 252
Chapter 10: Dimensions of Culture and Branding 253

Marketing Communication—The Ethnic Way 269
Branding Associations and Cultural Practices 273
Chapter 11: Retailing and Consumer Behaviour

Linkages to Branding 291
Dimensions of Retail Equity 305
Developing Retail Equity—Importance of the Target Segment 305
Importance of Appropriate Service 307
Retail Loyalty 310
Customized Information Search—A Futuristic Retailing Option 313
x Contents

Point of Consumption Is the “Point of Decision Making” 318
Consumer Compulsivity in the Indian Modern Retail Setting 318
Hedonism as a Retail Experience 319
Chapter 12: The E-Mode of Brand Positioning: The Need for an

Online Positioning Interface 321
Introduction 321
Different Dimensions of Brand Positioning 323
Loyalty as a Positioning Dimension 323
Positioning Framework-I 326
Positioning Framework-II 328
Positioning Framework-III 333
Other Topical Dimensions/Issues in Positioning 334
Marketing Implications: Creating a Synergy Between Off-Line
and Online Positioning 334
Framework for Synergising Online and Off-line Strategies 335
Chapter 13: Concepts of Customer Satisfaction, Loyalty

and Relationship Management 341
How Consumers Learn from Experience 342
Seeking Customers and Retaining Customers—The Concept of CRM 344
Drivers of Relationship Programs 348
Brand Loyalty as a Strategy 352
Planning Customer Relationships 355
Customer Mapping: A Practice-Oriented CRM Tool 359
Expectations Matter 367
PART II READINGS 369

Reading 1: Factors Affecting Brand Loyalty: A Study in an Emerging
Market on Fast Moving Consumer Goods 371
Reading 2: Cultural Values and Branding in an Emerging Market:

The Indian Context 393
Reading 3: Linkages Between Brand Personality and Brand Loyalty:

A Qualitative Study in an Emerging Market—The Indian
Context 423
Reading 4: Cultural Dimensions and MNC brands: A Study in

the Indian Context 451
Contents xi
Reading 5: Research Dimensions on Point of Purchase 477

Reading 6: Expansion Advertising as a Precursor to Brand Loyalty in
India 499
PART III CASES 517

Case 1: Fiery Thrills or Windy Rides: Positioning a new Brand of
Motorcycle in the Indian Context (An Emerging Market) 519
Case 2: Call of the Mass Markets: The Indian Cell Phone Industry 545
Case 3: The Importance of Experiential Marketing in Marketing

Communications 571
Bibliography 591
Name Index 597
Subject Index 602
Preface
The Indian market is referred to as an emerging market. The Indian academia

too, is emerging to compete with the evolved academia in the developed parts
of the world. This book is an attempt in the backdrop of such evolving aca-
demia. Based on the feedback received from students and faculty on my earl-
ier publications, I felt that there was a distinctive need for a reference book
that connects the conceptual field of consumer behaviour with the Indian
context, not only in terms of basic concepts but also in terms of research read-
ings and cases. Students need to appreciate the adaptations that are required
in research methodologies, especially when these students are prospective
practicing managers. I was also particular that the style and presentation of
the material appeals to the students of any management program in the coun-
try, given the diversity of students who are drawn into these programs. This
diversity is reflected, not only in the various disciplines from which students
are drawn into management programs, but also in the teaching methodolo-
gies that are followed across disciplines. The book's style and presentation
also takes into account the orientation of executive education in order to ap-
peal to the executive segment that may be interested in consumer behaviour.
Spread over three parts, the book analyses the concepts associated with
consumer behaviour, real-life topical issues, practice-oriented research read-
ings and three elaborate cases. The Touch of Reality boxes deal with issues that
are unique to the Indian context, and will help students to connect with chal-
lenges that are exclusive to the framework of emerging markets.
The first part focuses on the vital aspects of consumer behaviour and
how these concepts relate to Indian brands. The second part presents re-
search readings on topical issues concerned with emerging markets, brand
personality, brand loyalty, marketing communications, cultural values
and expansion advertising. The third part deals with three elaborate cases
drawn from the Indian context.
I hope this book will motivate students of consumer behaviour to delve into
greater depths to understand this important domain, both from the “consumers
xiv Preface
and markets” viewpoint and from the viewpoint of understanding individual

behaviours. I welcome suggestions and feedback from the readers.
Acknowledgements
I am extremely thankful to several individuals and organizations, without
whose timely support this book would have never taken shape.
I thank Professor Kevin Keller, world renowned academic in the field of
marketing and branding, of the Tuck School of Business for endorsing my
work. It requires unusual kindness and generosity to vouch for the work of a
fellow-academic in an emerging sphere, and mega brand Professor Keller has
allowed me to have a “rub off” of his academic fame in doing so. To me, such
a gesture suggests that a brand's success is even greater if humility is part of
its associations.
I am thankful to Mr Bhaskar Bhat, Managing Director, Titan Industries,
Bangalore, for the time and effort he has taken to examine my manuscript
for an endorsement. His endorsement of the work is indeed an honor to me.
I would also like to thank Mr Manoj Chakravarti, Chief Operating Officer,
Center for Corporate Governance, IIM Bangalore, for his kind support as my
interface with Mr Bhasker Bhat. I thank my sincere well-wisher, Mr A. C.
Chidanand, Group Manager, SAP, Titan Limited who kindly provided the
inputs I had requested for this book.
I am much obliged to the following managers of Titan Limited for their sup-
port: Ms Suparna Mitra, Global Marketing Head, and Ms Vandana Bhalla, Mar-
keting Manager, Titan; Ms Kalpana Rangamani, Marketing Head, Sonata; and
Ms Simeran Bhasin, Marketing Head, Fastrack & New Business.
I am grateful to the following editors of journals and business press for
providing me with the necessary permission to carry my published articles:
Mr Vinay Kamath, Editor, The Hindu Businessline; Dr Anne Foy of Westburn
Publishers (Publishing Editor of Journal of Customer Behavior and Marketing Re-
view); Dr Kartik Dave, Editor, Indian Retailing Review; Dr Jan Travers of Idea
Publishers; Dr Mathew Manimala, Editor and Mr C. Ramakrishna, Executive
Editor, South Asian Journal of Management; Dr Alvin Gilbert, Editor, Interna-
tional Journal of Management and Entrepreneurship; Mr Ben, Editor, Pitch maga-
zine; and Ms Brenda Rouse, Editor, Journal of Brand Management
I am indebted to Mr Arnab Das, Brand Manager, Marico Industries, for the
efforts and time he had devoted to put in a caselet that provides a touch of
reality to the work. I am happy to acknowledge the contribution of Ms Deepa
Rajaram, HR Manager, Marico Industries, who has provided the necessary
support. It is also worthwhile to mention the efforts of Mr Sameer Satpathy,
Head, Marketing Consumer Products, Marico Industries, towards the process-
ing of the caselet that appears in this book.
I thank M/s Hindustan Unilever Limited for its contribution that has been
enormously helpful in the preparation of this book.
Preface xv
A special word of recognition is due to the following executives for provid-

ing me with several inputs that were useful to this work: Mr G. K. Suresh, Brand
Manager, ITC; Ms Sudarshan Maiya of MTR; Dr Srikanth and Mr Antaah Sheikh
of Himalaya; Mr Chanchalapathi Das, Vice President, ISKCON Bangalore;
Dr Rajaretnam, Vice President, Research International; Ms Vyshnavi and Mr
Rajesh of JWT, Bangalore.
I acknowledge the spontaneous support provided by my former students
Mr Sooraj Bhat, Brand Manager, Madura Coats and Mr Mudhurjya Banerjee.
Some of their inputs have gone into this work.
The following persons have been associated with my progress and work at
some point in my academic career. I would not have been in a position to sus-
tain my academic pursuits, but for their steadfast support: Dr B. Ilango, Former
Vice-Chancellor of Bharathiar University, Coimbatore; Mr Goplakrishnan, Ex-
ecutive Director, Tata & Sons; Mr B. Suresh, during his tenure with Hindustan
Unilever Limited; Mr Atul Sinha during his tenure with Colgate Limited; Dr
K. R. S Murthy, Former Director of IIM Bangalore; Professor Dipak Jain of the
Kellogg School of Management; Mr Bijou Kurien, Chief Executive, Lifestyle Di-
vision, Reliance Industries; and Mr Bharat Puri, Regional Commercial Strategy
Director, Cadbury Schweppes.
Professor Pankaj Chandra, Director, IIM Bangalore, helped me with the fa-
cilities I needed to pursue this work. I am thankful to him. Ms K. P. G Rama
provided adequate support by way of secretarial assistance.
I acknowledge the cooperation and patience shown by the editors at Pearson
Education. Associate Production Editor Mr M. R. Ramesh was sincere and
involved in his interactions with me. I appreciate the efforts taken by him to
understand the subject with a view to copy-edit the text appropriately. Mr J.
Saravanan, General Manager, Marketing, was the driving force behind my asso-
ciation with Pearson and I thank him for his sustained support and motivation.
Editors Ms Anindita Pandey and Mr M. E. Sethurajan were also instrumental in
bringing the book out in its present form.
Finally (not in the order of importance), I thank my wife Amrith Ramesh,
my daughter Sahana Ramesh and my parents for supporting a mindset that
enabled me to attempt this work.
S. Ramesh Kumar
Why Concepts Are Important in
the Indian Context
The Indian context offers unique challenges to marketers. Cultural and eco-
nomic diversity, a blend of Western lifestyles and strong cultural anchoring,
and the rural/urban divide with islands of prosperity in rural areas are some
of the critical factors that need a specific-context treatment in terms of formu-
lation of marketing strategies. The affluent niche markets are as important as
the “bottom of the pyramid”—lower end markets. The unorganized markets
also pose a challenge to the branding of products and services. The following
data indicate the unique nature of the Indian context.
According to the Sample National Survey Organization, there are 58.5 mil-
lion urban households and 148.1 million rural households. The penetration
levels of various product categories in the urban households are (the figures
provided are to give the reader an idea of penetration of different product cat-
egories in an emerging market):
 Cars 4.4%
 TV 66% (41% with cable connection)
 Refrigerators 28%
 Air coolers 15%
 Personal computers 3.1% (with and without Internet connection)
 Fixed-line telephones 24%
 Mobile phone 3.3%
In the case of rural households, the following are the penetration levels of
various product categories:
 Cars 0.6%
 TV 28% (10% with cable connection)
4 Consumer Behaviour and Branding
 Personal computers 0.6%

 Fixed telephone lines 5.3%
 Mobile phones 0.9%
A conceptual approach should be adopted to find solutions to challenges

posed by the Indian context. Some of them are:
 What does value mean in any given category?
 Can there be a successful business model built-up to cater to the mass
markets?
 How should various pricing strategies be adapted to the Indian context?
 What aspects of the marketing mix elements play an important role in
brand building?
 How should marketers approach premium brands/markets?
 What kind of product-based strategies are required to succeed in the In-
dian context?
This book does not attempt to provide the solution for such questions; it
merely attempts to emphasize the need for a conceptual orientation when
strategies are formulated in a specific marketing context.
Touch of Reality
Touch of reality provides a snapshot of the Indian marketing scenario with
an indication of the challenges and complexities involved. This is likely
to motivate any one passionate in marketing to learn further about apply-
ing marketing concepts to the enigmatic Indian context.
India offers unique challenges to marketers. Upwardly mobile soft-
ware technologists with designer lifestyles form a niche market; there are
millions in the mass market who depend on non-branded offerings and
there is a huge middle class which may be buying national brands with
reference to fast-moving consumer goods categories and aspiring to own
several durable categories. In a country of about one billion people, just
about a million of computers and a million of cars are being sold in a year.
In India, there are about 6,25,000 villages (or hamlets) and about 80 per-
cent of them have a population of less than 5000. Around 75 percent of
the country's population lives in villages and the population of India is
spread out in 28 States and 7 Union Territories with diverse customs, cul-
tures and languages. The per capita income of the country hovers around
US$ 720. There are invisible children in the country—a UNICEF report
mentions that only 30 percent of the childbirths are registered in India.
Introduction 5
A number of children are employed as domestic help and child labour is

a rampant problem in the country.
Multinational brands in a number of categories, especially those
with lifestyle orientation, are predominantly consumed in urban mar-
kets while these brands continue to inspire consumers in the hinterland
of the country. This introductory note focuses on the importance of two
aspects that are vital to the Indian context—cultural dimensions and
the timing of products. The context presents challenges that are some-
times addressed by traditional concepts in marketing, and sometimes by
context-based marketing; so that the outcome benefits both the corporate
establishments and the society at large. Marketing in this complex scen-
ario with diverse consumer segments requires a complete understand-
ing of the intricacies of the context and the several dimensions of con-
sumer behaviour. Multinational corporations have joined the competitive
clutter already existing in the form of local brands. Whether it is a mass
market or a niche one, understanding the diversity of the Indian market
is a prerequisite for marketers; the marketing mix they formulate needs
to reflect the associated intricacies. According to Goldman Sachs (2003),
BRIC (Brazil, Russia, India and China) promise a tremendous growth in
economy and would be global leaders in a few decades. But GDP may
not be an indicator of global power. According to Arvind Virmani [who
worked out the Virmani Index of Power (VIP)], who had analysed several
aspects of the economy of USA, income per head, strategic military and
technological leadership are important to ensure that a country becomes a
global leader. India, according to the index developed by him, scores just
8.5 percent benchmarked against a 100 percent-rated US. A global power
requires a country to score above 20 percent, and US, Japan and China
are the countries in the global power league. Widespread poverty, niche
class of elitist consumers, fast track middle class population who have en-
hanced their lifestyle in the recent times, government policies concerning
trade, developments in the international marketing scenario and oddities
that create barriers to marketing, make marketing a unique and challen-
ging task for marketers in the Indian context.
Importance of Cultural Dimensions

India, as a market, has a unique culture; and the marketing mix elements
should take into consideration the cultural dimensions that have profound
implications on the psyche of consumers. The importance of culture can be il-
lustrated by a few examples. Multinational brands have been marketing sham-
poo brands for the past several decades, but an almost unknown brand (at
the time of its launch) called Velvette introduced shampoo in a sachet two
decades ago. About 70 to 80 percent of the shampoo category sold in the coun-
try are consumed through sachets and most multinational brands have sham-
poo offerings in sachets. High degree of price sensitivity is a strong cultural
trait in the Indian mass market. In the same category, a brand, Chik, a non-
multinational brand was the first to use a floral fragrance. Floral fragrance and
flowers form part of the culture, especially in southern markets of the country.
Women wear flowers on their hair and also use them to decorate deities. They
also use flowers for festive and auspicious occasions. Food is a category, which
has a strong cultural orientation with regard to the cultural aspects of eating.
Bread, as a category, has been present in the country for almost a century, but
its penetration level is low. Sub-cultural aspects in a specific region dictate
food preferences, and there is a significant variation on food habits and tastes
across the country. A brand called Maggi (noodles) from Nestle is probably
one of the few brands to have registered some degree of sustained receptivity
among Indian consumers during the 1980s, though noodles are not of Indian
origin. However, Maggi was positioned as a brand of snacks for children that
could be conveniently cooked in two minutes. The brand appealed to urban
consumers among whom employed couples are common. The proposition of
convenience was attractive to this section, which found the brand to be a use-
ful snack both in terms of taste and ease of preparation. Kellogg's initially po-
sitioned itself as a nutritive breakfast for children, and pitched its advertising
campaigns attacking traditional oil-soaked delicacies on the health platform.
Later, the brand stopped its attack on the traditional delicacies, perhaps re-
alizing that it was questioning a strongly-held belief about traditional food.
Kellogg's has made little headway in terms of substituting traditional breakfast
in Indian households because of both the cultural habits and the steep prices
(as compared to the traditional food made at home). General foods has its
Pilsbury wheat flour, which is packaged and advertised; but only about 8 per-
cent of the wheat flour sold is from the branded category. Consumers continue
to procure wheat flour from their neighbourhood retail outlets or take wheat
to neighborhood grinding stalls to get it ground. Consumers have a strong
belief that freshly ground flour is tasty and fresh apart from being less costlier
than branded offerings in the category. Coffee is a drink confined to the south-
ern markets and despite the category being present in the market for several
decades, India remains a tea-drinking nation (though in recent times higher
prices of coffee has added to the practice). Nestle and Cadbury, probably for
the first time in India, have introduced a liquid form of chocolate priced at less
than 5 percent of a US dollar. Liquid chocolates at this price has the advantage
of bringing chocolates within affordable range of the masses and the consumer
base gets extended. Coke and Pepsi also have low-priced, 200-ml glass bottles
that are recycled by retailers as consumers are not allowed to carry or destroy
them. Films, music and cricket are a part of the Indian culture in a number
of markets (there are specific markets where soccer is popular too) and the
present trend among markets to use celebrity endorsement is not surprising.
Some of the categories in which film/cricket celebrities are used for endorsing
brands are soaps, milk-additive drinks, cars, apparel, television, household
Introduction 7
appliances, soft drinks, regional foods, chocolates, watches, paints, shaving

creams, biscuits, washing machines and two wheelers. Santro, the brand of
car from Hyundai, has made rapid strides in the passenger car segment using
a combination of rational and celebrity appeals in its advertisements. Initially,
the brand being new to the Indian market, used a reigning celebrity to get
the attention. Then it used rational appeals to get into the consideration set of
consumers and brought back the celebrity to position itself as a lifestyle brand
after achieving success based on its functional appeal. An interesting point
is that a few celebrities find acceptance with consumers in all socioeconomic
classes and are used by diverse product categories. Celebrity usage across
product categories is quite common in the Indian context and the intensity
of such usage is on the uptrend. In-film advertising (product placement) has
been attempted by a few brands. Fanta, the orange drink (from Coke), and its
competitive brand Miranda (from Pepsi) use regional celebrities in respective
markets to advertise the brands. Fairness creams are a significant category in
the personal care segment. Fairness of the skin as an indicator of beauty is
another cultural belief, which is being used by marketers. Fair & Lovely is
a popular brand of fairness cream, which advertises regularly and its recent
commercial has a theme, using cricket as a backdrop. It shows a girl aspiring
to be a cricket commentator (a male-dominated field) and she is able to achieve
her ambition by using the brand, which helps her by bolstering her confidence.
Biscuits, not only as a snack but also as a kind of food, are a cultural habit.
Tiger, a brand of biscuit from Britannia focused on the health aspect for its
brand proposition and used a well-known cricket celebrity to target the lower
end of the biscuit category (mass market). The brand has a sizable chunk of the
lower end of the category, which was earlier dominated by the unorganized
sector. (An unorganized sector has a number of offerings catering to a small
local market usually in the range of 30–40 kilometers or less. These offerings
are not branded and are manufactured by small-scale units in small volumes).
Importance of Timing
The launch timing of a product category is a critical factor in Indian markets.
Consumers would have to be culturally and inspirationally ready to be re-
ceptive to new categories. For example, even in the ultramodern neighbour-
hoods of the country, it may be difficult to find accomplished and liberated
women smoking cigarettes. A minor segment may be smoking in clubs/pubs.
Paradoxically, there is also a small segment of women in the lower section
of the society, normally workers, who smoke a different version of tobacco
called bidis. But this segment too is very small and is present in only certain
regions of the country. Therefore, there has been only one brand called MS,
which launched its cigarettes to professional women almost a decade back,
but it was withdrawn from the market within a short period of time. These
are product categories, which could be termed as neo mindset products, which
have close linkages with cultural values. Marketing managers would have to
time these product categories taking into consideration the changes in the en-
vironment. Condoms have been in the country for almost four decades, but
it is only in the past decade that a few brands have been able to use media
campaigns highlighting the features and benefits. KS, a brand in the category
was the earliest of the brands to run a permissive campaign during 1990s in
the urban markets. This would not have been possible a few decades back,
given the cultural inhibition associated with the category. Timing the launch
of a product also involves considering the product usage and habits of con-
sumers. When Procter & Gamble introduced its compact high-end detergent
brand Ariel during the late 1980s, it advertised that a bar version is not re-
quired to clean fabrics. A majority of Indian households use detergent bars
to rub and clean clothes and there is still a widely held belief that rubbing
clothes is required to effectively clean the fabrics. Going against this belief,
without knowing if the timing is right (timing, in this context, refers to evo-
lution of consumers with regard to beliefs about a category or its usage), can
be counterproductive to brands. Ariel, later introduced its version of bars for
the lower end. Another brand of the company, Tide, also started off with de-
tergent powders, and has now introduced a bar version of the brand. Frozen
vegetables that were marketed by Hindustan Lever in the 1960s failed and
even today the market for the category is limited to a few markets. The mass
market has not reached a state when it could be receptive to the category—
affordability and taste beliefs may together contribute to the present state of
the category. Mouthwash brands have been present for a long time, but they
have a low penetration level. Category growth too, is associated with the tim-
ing of brands and product categories. Analysis shows that creating the right
timing in a changing environment has to be initiated by, probably the pioneer-
ing brand, and there are categories that have not grown, despite the environ-
mental changes being conducive to the growth of these categories. There has
been tremendous awareness about personal grooming in recent years, and des-
pite these changes, the hair cream market has not grown over several decades,
though the brand Brylcream has been in the context for several years. When
the category growth does not happen slowly over a period of time, short-term
communication or repositioning strategies may not produce much mileage for
the brand initiating such strategies. Brylcream had tried to reposition itself in
its category. Liquid detergent is another category, which perhaps belongs to
the same category of examples. Though a few brands have been in the context
for a long time, the category growth has not occurred.
The Indian context is a unique one, which requires marketers to adopt spe-
cialized marketing strategies to adapt to the complex environment.
Challenges in Emerging Markets

The art and science of the marketing discipline may have originated from the
West, but it needs to be adapted to the unique challenges of an emerging mar-
ket like India for a brand's success.
Introduction 9
The emerging market in India has distinctively different demographics and

market nuances that are significantly different from developed markets in the
West.
 India has about 15 million retail outlets.

 Indian households have a diverse income range – 100.1 million house-
holds earn below Rs 90,000 and most of these households are below
the poverty line, 90.3 million households earn between Rs 90,000 to Rs
2,00,000, 10.8 million households earn between Rs 2,00,000 to Rs 5,00,000,
2.4 million households earn between Rs 5,00,000 and Rs 10,00,000, while
about 1.2 million households earn above Rs 10,00,000. This reflects the
diversity of the market from the subsistence level to the super luxury
levels of consumption that takes place from both branded and un-
branded offerings.
 30 percent of retail transactions (by value and 70 percent by sheer num-
bers) revolve around the Re 1 price point.
 Celebrity advertising has diffused across categories. Videocon, in an at-
tempt to drive home its brand values, launched an advertising commer-
cial with two celebrities belonging to the film industry and cricket – the
two fields that are a throbbing part of the Indian culture.
 There is a huge presence of unorganized market in India in several
categories – soft luggage, biscuits, confectionery, cassettes, personal com-
puters, tea and watches to name a few, while in certain categories there
are numerous brands in the organized market. For example in the tea
market, there are about 500 regional brands in the organized sector.
 Marico's products (that include Parachute and Saffola brands) reach
130 million consumers in 23 million homes with 70 million packs through
2.5 million outlets in India and abroad.
 Nokia, the mobile brand with a leading market share in India, would like
to be an internet service provider through mobiles with music down-
loads, e-commerce applications and entertainment options.
Beyond the glitz and glamour of advertising, several conceptual ap-

proaches provide the foundation for category development in an emerg-
ing market like India. Category development and market expansion are
pre-requisites for developing brands in a country like India where complex
diversity poses unique challenges to marketers. With the exception of a few
categories like soaps, edible oils and biscuits (even in some of these cat-
egories the percentage of branded offerings may not be very high, like in
edible oil), several categories have a low penetration level when compared
to developed markets. Despite the mobile subscriber base close to touch-
ing 500 million, there is still scope for brands to increase their penetration.
While the overall penetration of a number of categories is low, the higher
end of the market (high-priced premium markets) is registering a high
growth and several brands across categories have entered these high-end
segments. Shampoos, apparel and entertainment electronics categories are

examples.
Challenges for Marketers

While there is so much interest in the “bottom of the pyramid” for catering to
consumers at the lower end of the market in emerging economies, building
a business model to cater to these consumers is one of the major challenges
to marketers. Such a business model will have to take into consideration the
following:
 Only around 3 percent of the extra retail market in India is accounted for
by modern retailing. Different formats that exist within the emerging re-
tailing scenario is another complexity.
 Product development for the mass market. It may be recalled that during
the seventies, there were only a few major brands of shampoo (Pond's,
Sunsilk and Clinic included) and the category itself was associated with
higher-end markets. Today a large percentage (around 65 – 70%) of the
market is drawn from the small “one-serve” usage of sachets. Primarily,
this form of packaging (sachet packs) has ensured that the category is
within the reach of several million homes. Similarly, brands like Nokia
(which has introduced India-centric mobiles) are attempting to create
markets at the lower end of the market by product development. It intro-
duced a model that has a mobile, a torch light and a radio. India, though
being one of the largest music markets, has a low penetration of even
radios! (It has just about 5 percent of penetration when it comes to CDs).
The point is that the urban perception of penetration with regard to sev-
eral categories is very different from the reality associated with the over-
all penetration levels in the country.
 The presence of a huge unorganized market in the country across
several categories is something very unique to the Indian market. The
unorganized market may cater to the local market, may not have a
branded offering and may not have the functionality associated with
a branded one. Nevertheless, consumers use the product categories at
a much lower price. Cassettes, apparel, detergent powders and soaps,
mineral water, watches, moulded luggage, biscuits, edible oil, tea, foot-
wear, personal computers, toys, UPS, domestic furniture, spectacles
… (the list of categories is never-ending). This reflects the nature and
impact of the unorganized sector on the economy and lifestyle of In-
dian consumers. Most of these categories have the unorganized sector
accounting for more than 50 percent of the total category. Footwear cat-
egory, probably one of the categories with high presence in the unorgan-
ized sector is highly fragmented. Even well-known brands like Bata and
Liberty do not have the typical “leadership share” that can be associated
with the soap category. It may also be noted that in this category, several
Introduction 11
upmarket brands have gained visibility in urban markets (Nike, Adidas,

Reebok are a few brand names).
 Besides dominance of the unorganized sector, there is also the problem
of the unique manner in which distribution channels have grown in the
country. While in the developed markets, there has been a reduction in the
retail density (the number of outlets for a given number of consumers),
there has been an increase in retail density in India. There are around 12
million kirana shops (small grocery or general store that is found within
walking distance of almost every Indian family) that probably will stay in
context for several decades to come, despite the emergence of retail giants.
These stores, with an area of generally upto 600 sqft focus on selling not
only a large variety of food products, but also stock most home necessi-
ties. The unorganized sector has its distribution through millions of small
retail outlets dotting the country. Given the retail structure and the geo-
graphical presence of these outlets, large retailers (modern format) may
not be able to replace the small retail outlets. Product category diffusion of
several categories, today, depends on kirana shops. Establishing branded
alternatives to several of these categories will take time and considerable
effort on the part of the marketing mix elements. Private labels at modern
outlets, to a small extent, can wean away smaller outlets. However, it is
difficult to predict how fast these labels will diffuse through the market, as
complex supply chain issues need to be solved by manufacturers.
Options Available to Branded Offerings

There are essentially three major strategic options available for brands in sev-
eral categories. The first option is to upgrade consumers, the second one is to
increase the frequency of usage and the third is to expand the overall mar-
ket. Each of these options requires a focused approach and a well thought-out
marketing mix that will both achieve the objective and contribute to profits.
Besides, a long-term orientation is required for some of these options. For ex-
ample, changing the breakfast habits of consumers calls for a change in some
aspects of culture, and it takes time (regardless of the social class of consum-
ers). Kellogg's tried it earlier for its cereals and Quaker Oats is attempting it
currently for its oats (though both these brands are not addressing the bot-
tom of the pyramid). Grameen Bank of Bangladesh used certain cultural traits
among people to build a successful model of a bank for the poor (the bank pro-
vides small loans without security but the default rate is amazingly negative).
The toothpaste penetration is only around 40 percent and there is still around
35 percent of the market using tooth-powder. Colgate has been marketing its
tooth-powder offering for decades in India. Such a situation in a category poses
several interesting questions for the brand manager: should the company up-
grade at the lower end, continue to strengthen the present offering at the lower
end or/and strengthen its brands like Total and Sensitive at the higher end? All
these aspects are concerned with category/brand development.
The Indian experience

A very good example of the development of a brand (both at the higher end
and at the lower end) is the brand Parachute. With several innovations relating
product and brand, the brand uses a combination of marketing mix elements
that have contributed to its success.
Parachute not only branded the basic coconut oil: it also created a number
of branded offerings to different kinds of segments to expand the category. Its
communication to different kinds of segments too was different. Category de-
velopment involves development of offerings that are branded through mar-
keting mix elements. It is not just in mundane categories that expansion can
take place – in an emerging market there are also markets growing fast be-
cause of rapid lifestyle changes.
Some of the categories offer scope at the higher end of the market (at-
tracting consumers price-wise at the higher economic spectrum). If apparel
is considered, the Western wear market for women, though a small portion
of the overall market, is growing quite fast and several brands in the men's
apparel category have extended themselves to women's Western wear. These
include Park Avenue, Wills Lifestyle, Color Plus, Arrow, Allen Solly, Van
Heusen and John Players (as Miss Players). Some of these brands also have
exclusive show-rooms for this segment. Some companies also differentiate
between older and younger generations with specific differentiation with re-
gard to the offerings. Gillette introduced its Vector Plus at a lower price point
as compared to its earlier offerings to enlarge the market. Though the price
of this twin-edged blade is several times more expensive than the conven-
tional blade, some consumers may try out the offering of Gillette and may
upgrade to these blades. Even an occasional use of the twin-edged blades by
a consumer habituated to the conventional blade will result in expansion of
the market in the sub-category of twin-edged blades. It is interesting to note
the strategies of brands in certain categories where the product penetration is
insignificant. Toilet cleaners as a category, does not have a high penetration.
Tex introduced an advertising campaign comparing its offering with acid (a
normal practice in several parts of the country to clean toilets). This campaign
that is different from the conventional practice of highlighting the brand's
attributes and benefits, used the familiar practice of comparison to create cat-
egory expansion – to move consumers using acid to a branded toilet cleaner.
Brands like Parry's (sugar), Godrej (Pilsbury atta) and Unilever (Annapurna
atta) attempt to expand the branded offerings among consumers in the mar-
ket for commodities. The branded offerings form a miniscule percentage of
the total market in these categories. Gold Plus chain from Tanishq is a good
attempt to create a branded offering at the lower end of the jewellery market.
Traditionally, consumers have been buying their family jewellery through the
regular “family jeweller”. This is a part of the Indian consumer's culture and
this is the widely held practice even in urban cities (the difference between a
small town and an urban setting may be the size of and variety offered by the
shop). Gold Plus attempts to create a branded offering with a network of such
Introduction 13
jewellers. The consumer not only gets an assurance of the branded offering
(in terms of purity and dependability associated with the product), but also
has a feeling of carrying on the practice of interacting with a local jeweller.
The blend of the cultural practice and branding is a strategic move to expand
branded jewellery.
Cultural nuances, lifestyle shifts, and marketing mix stances are some of the
fundamental aspects of emerging markets: brand building needs to consider
them, not only to build brands but also to develop categories.
Concepts in
Consumer Behaviour
This section examines conceptual linkages related to the Indian marketing reality. Brands
need to address a variety of marketing issues, and behavioural and marketing concepts
enable marketers to think in a structured way. There are a few marketing issues addressed
in this section with an objective to enable the reader to appreciate the concept–practice
linkages before going through specific chapters on consumer behaviour. Practitioners in
emerging markets like India need a conceptual orientation to face the unique challenges
presented by the Indian context.
1
Linkages Between Concepts and

the Indian Marketing Reality
The Experiential Approach to Branding

Experiential marketing is becoming popular in the marketing of products and
brands. It may be interesting to note that consumers have always experienced
products and services since time immemorial and the renewed interest in the
discipline is more because of the accent on consumer behaviour intricacies.
Differentiation, whether it is with regard to products and services or with re-
gard to marketing strategies makes a difference to consumers, and experiential
marketing is one of the topical strategies that have attracted marketers and
academics all round the world. At the outset, it may be worthwhile to clarify
what is experiential marketing. In a “global” marketing context, concepts and
paradigms are often used as catchwords, but marketers should understand
such concepts not only with clarity but also with regard to their applicability
in a specific context. Adapting concepts and strategies to a context is a major
challenge to marketers.
What is experiential marketing ?

Since the advent of television in the Indian market, consumers have been
watching programs. Why is there so much of interest in cricket matches and
programs like Indian Idol that are telecast alive? Would TV viewers like to
view recorded programs instead of live ones knowing very well that the
programs are the same if they have no clue on the contents of the program
(for instance, viewers viewing a recorded one day cricket match without know-
ing in advance, who the winners were)?
While the experience of the viewers appears to be the same, most consum-
ers would prefer a live Indian Idol program because of what the latest research
stream calls as indeterminate consumption experience in which there is some
suspense and thrill on how the events unfold in a program. Besides, there may
be instances where consumers would like negative emotional experience, with

the foreknowledge that they are in for an emotionally unpleasant experience
(viewers watch tear-jerker movies and TV serials that are popular in several
regions). Typical examples from the entertainment industry have been chosen
to convey that an experience by itself has many hues and that there needs to
be a structured approach to understand them, so that they can be used in a
variety of ways. An experience has a sensory or a multi-sensory orientation
that arouses emotions, fantasy, feelings or pleasure. According to a well-known
academic (Schmidt) who pioneered the concept in recent times, the experience
cycle consists of sensing, thinking, feeling, acting and relating, and this cycle is
the experiential cycle. However there can be several interpretations and varia-
tions to this concept and one such conceptual direction is presented by the
author. Apart from viewing the concept, the approach can be made applicable
to several categories of products with a specific factor associated with the cycle
(for example, think or relate factor) influencing the marketing strategy in a
dominant manner. This direction of thinking requires the application of the
concept depending on the type of product or service. After defining what ex-
periential marketing is, the next step is to understand how the process is to be
applied to a consumer as an individual. As shown in Table 1.1, there are a few
ways that can be adopted to make use of experiential marketing.
Physiological consumption experience deals with the physical consumption of
the product (Pepsi, Cadbury or Baskin-Robbins ice cream).
Application-based consumption experience of products is the application of
products (like fairness creams, shampoos and antiseptic lotions).
Conspicuous consumption experience is more applicable to products and
brands that are used as social meanings (designer watches, branded apparels,
and passenger cars as status symbols are examples).“Social experience” leads
to psychological gratification.
Fantasy consumption experience is applicable to services like vacation pack-
ages, music, movies and fashion-show events.
“Well-being” consumption experience is associated with services like health
care and banking in which the risk of failure is likely to have a serious impli-
cation for the consumer. The idea behind these kinds of categorization is not
to be exhaustive in covering all product or service categories: it is only to pro-
vide a direction that will blend the theory with the practice of the theory on
experiential marketing. One can make out that even physiological experience
can lead to fantasy-based experience. One form of experience may always be as-
sociated with another. For instance, the “sun block” offerings from the cosmetic
brand Fair & Lovely is essentially an offering that promises to address suntan,
sunburn, premature aging and heat when the consumer experiences the ben-
efits on application (application-based consumption). It is associated with how
well satisfaction is created in the mind of the user (satisfaction that is associated
with psychological aspects). A hotel has to satisfy the consumer's need for both
physiological experience (food) and well-being experience (ambience). Market-
ers need to understand the clarity of the concept before applying it in discretion-
ary ways to suit their products, target segments and the context.
1  Linkages Between Concepts and the Indian Marketing Reality 19
Table 1.1  Experiential Marketing
Physical consumption Physiological experience

Application-based consumption Application experience
Non-reality consumption Fantasy experience
Conspicuous consumption “Social experience”
Risk-free consumption “Well-being” experience
Applying the concept of experiential marketing

Experience is always associated with some form of pleasure. Coffee, tea, ciga-
rettes, liquor, food and beverages are associated with physiological pleasure/ex-
perience. The “Thanda Coke” Mountain Dew's appeal and the “Sweet Cadbury”
clearly points out to the experience consumers are likely to have when they taste
these offerings. Advertisements for several product categories of this nature that
have conventionally relied on family, warmth or romantic appeal will do well to
use creativity with regard to portraying aspects of physiological consumption
that are unique to the brand. Red Bull's “energy as an experience” proposition
demonstrates how strong such propositions can be in terms of achieving the
competitive edge in a common-place category like soft drinks. Dettol's cultur-
ally internalized “burning, medicinal odour” can be a strong differentiator in
the category of antiseptic lotion under the application-based experience. Dove's
moisturizer-based differentiation in soaps is another example of how a brand
can stand apart in a crowded category that is associated with application based
experience. Dove's advertisements explained how the application of the brand
is different from that of ordinary soaps. As reflected at the beginning of this sec-
tion, the entertainment industry provides the psychological stimulation that get
translated as fantasy-based experience. The ambience created in the bank with
the prompt service or the ease of connectivity associated with a brand of cellular
phone makes a lasting impression on the consumer and this gets converted into
the “well-being” experience, by which the consumer is assured of an experience
without any risk. Several high-value durable categories can also be considered
under “well-being” consumption experience. A product's outcome is the funda-
mental plane on which an experience is built up in such services. Billings with
error and bad service response provided from a cellular service can never be
offset with the glamour and glitz of advertising in the long run; this is especially
true in services that can be associated with “well-being” experience.
The experiential cycle (sense—to relate aspects mentioned earlier) can be
used for each of the experiences in various combinations. There are two im-
portant conceptual implications of the categorization of these experiences—
how should the product or service be promoted/advertised and more import-
antly, how the core aspect of the product is unique to provide an experiential
platform for the brand.
Consumers and Contextual Creativity

 A consumer desperately attempts to draw money from an ATM but finds
that he has no balance.The ATM offers the consumer a loan by flashing
a message if the consumer belongs to a certain privileged segment of
the bank.
 An airline passenger enjoying a new launch of easy-listening semi-
classical music finds his screen flashing a message allowing discount for
his/her favourite music CD, if he is categorized under a privileged class
of consumers.
While there are several concepts and research streams that may be evolving in
marketing literature, a practical approach towards the application of concepts
requires the backdrop of a specific context and hence marketers will have to be
sensitive to contextual creativity. The Indian context, with its unique circum-
stances and environment, offers tremendous scope for such creativity. The vast
population at the bottom of the pyramid, changing lifestyles, cultural moorings
and the fragmented economic spectrum offer a backdrop, where contextual
creativity is almost a prerequisite. Brands that provide such kinds of creativity
are the ones, which are able to create and sustain success. A simple application
of such creativity can be associated with basic marketing elements.
Product is the most fundamental part of the marketing mix and the one
around which any kind of branding is built. Brands through positioning strat-
egies, are created as a part of the product. An innovative product that reflects
value carries a spontaneous appeal and marketers will have to innovate based
on the type of target segment. Bru's small pack of Re 1 (for perhaps half-a-
cup one-time serving of coffee) in some coffee drinking markets is a creative
move. At a time when coffee as a drink is getting costlier, avid coffee drinkers
at the lower end of the market may switch between coffee and tea. The one
rupee sachet option enables the brand to be used more frequently than when
such an offering is not available. More than the immediate numbers of sachets
such a move may sell, the fact that this brand of coffee remains in the consid-
eration set of the habitual coffee drinker conveys the impact of such a move.
Fair & Lovely's offering, for several decades, is based on the strong cultural
belief that beauty is associated with fairness: the recent adaptation of confi-
dence as a result of fairness is also a context-based one, given the aspirational
levels of this generation. The cultural context offers tremendous opportuni-
ties for marketers to adapt to the specific environment. It was the Vicco facial
cream that used the positioning stance of a wedding occasion to market the
brand some decades back. The back-to-the-nature trend is prompting sev-
eral brands like Ayush, Chandrika (from Wipro) and Vatika to launch herbal
offerings in the soap category. Timing a product, which offers value and the
appropriate psychological appeal, is also important while marketers adapt
to the changing environment. Mahindra & Mahindra's Scorpio is a good ex-
ample of creating an offering, which not only signaled tangible value but also
intangible value. Though the product's intrinsic value is the core aspect of the
offering, positioning plays an important role in defining the context in which

the product, and hence the brand is perceived. How should a brand of cereal
be positioned—as a substitute to breakfast or as a snack for teenagers or as a
food extender, which requires it to be perceived with other food items?
Timing of contextual creativity

Creativity does not require a break-through idea in practice: it requires applica-
tion of simple concepts. How should tea bags, a simple product, be positioned
in an environment in which most of the category sale comes from the institu-
tional segment. Some more brands (other than Taj, the pioneering brand) have
appeared in the market. There are several varieties of tea bags. Tea drinking
is a part of the culture in most parts of the country, but why do consumers
resist the taste? Affordability can be one reason for a number of consumers
(given the price and the quantity of tea that can be prepared from one tea bag).
In a number of product categories, lack of contextual creativity has probably
limited the diffusion of the category itself. The tea bag is one such category.
The category, ever since its launch in the market, has been associated with con-
venience and hence brands find it difficult to get into the psyche of consumers
for anything other than this aspect (variety segment is a very small segment
and it is a premium one). When the proposition of a category is not altered by
brands for a significant length of time, the proposition becomes a generic one
to the category. Hair cream is one more category that could be associated with
this situation. Brylcream was a pioneering brand and perhaps consumers did
not associate the category beyond convenience and it will be a challenge for a
new brand attempting to revive/create the category. Mouthwash is one more
category, which has low penetration and the global brand Listrine was the pi-
oneering brand. A brand of hair cream associating itself in trendy ways with
the hairstyle of the motorcycle rider, at a time when motorcycles for the urban
youth was taking off may have made the brand a part of the youth stereotype.
Importance of situation as a segmentation base

Going back to concepts, Kotler's differentiation between sector and segment
is an important distinction as it has critical implications on branding. The ex-
amples of categories discussed earlier target sectors and not segments and this
is the underlying problem, which inhibits creativity within a context. Even if
convenience is a proposition, a brand needs to build up a differentiation when
other brands are launched in the market. In contrast, by having a differentiation
factor associated with the category, the brands have been attracting sectors of
consumers—tea bags with the association of convenience has been attracting
several sectors like housewives in a hurry, bachelors, elderly people, or execu-
tives who require a quick drink. The copy-book style of segmentation (with pre-
cise definition of the segment through demographics and pyschographics) is
missing. While there is nothing wrong with this approach, this signifies prob-
ably a mass-market approach, rather than a market, based on segmentation.
(In segmentation (marketing mix elements included), each segment requires

a distinctive offering). In contrast, Titan, with its gift proposition reinforced
for the last several years, roped in sectors of consumers (like students, urban
youth, couples, children, the middle class and businessmen) and went on to ad-
dress these segments with specific offerings that were distinctive (with specific
models). The idea is not to address how a productline is to be managed but to
emphasize the importance of segmentation bases in conceptualizing contextual
creativity. Dettol soap with its “germ killing” proposition, showing consumers
in cars going through dusty roads, is a very creative manner of using occasion as
a segmentation base. Britannia's creation of several sub-brands using distinctive
product attributes is a good example of how a company in a culturally diverse
market has adapted itself through appropriate segmentation bases. Its lower
end versions are backed up by small packs enhancing the appeal of affordabil-
ity to the consumers. Chandrika soap's recent association with the “freshness
of spa” is an attempt to appeal to a certain segment of youth, a departure from
the traditional ways of positioning a herbal offering. If the growing category of
cell phones is considered, brands seem to bank more on the price of the handset
or on the charisma of film celebrities. An insightful analysis of various types of
consumers, their goals of buying the product (not just for functional purposes
and their usage patterns), will trigger worthwhile segmentation bases to be used
profitably. Bytes, introduced by Cadbury, uses the occasion of snacking in con-
trast with the “impulsive buy” occasion associated with chocolates.
Creativity with other elements of the marketing mix

In a country where there are a large number of consumers who buy loose oil
due to reasons of not being able to afford the unit cost (of a half a liter or one
liter pack), a brand introduced a vending machine that provides the required
quantity of edible oil, with a quality much superior to the offerings in the un-
organized sector (loose oil sector). Bilkul, the new chewing gum from Cad-
bury introduced a novel way of sampling the brand. The brand was sampled
with lunch boxes, which were carried by regular messengers (dabbawalahs)
to offices during lunch time. Liberty, the footwear brand's new set of “retail
revolution” outlets, stocking up more of trendy footwear for a specific seg-
ment, is an attempt to give the brand a youthful image. ITC's e-Choupal ap-
proach to reach the farmer and procure commodities for usage in its offerings,
is a good strategy in the Indian context. ITC's foray into confectionary to use
its vast network of distribution is also a context-based adaptation, using the
strengths of the company. Pricing in line with the consumer's perception of
value of an offering is one of the topical issues facing marketers. Chik's intro-
duction of 50-paise sachets during the days of sachet revolution and more re-
cently the company's pricing of its branded pickles are examples of pricing
adaptation. Parry's branded sugar positioned as a pure offering is priced at a
slight premium over the loose sugar normally available in most outlets. A con-
sumer's perception of value is backed up by the slight premium charged. The
pricing of Scorpio, and more recently the pricing of Swift from Maruti in the
passenger car market, illustrates how brands are attempting to create a value
perception in an increasingly cluttered environment.
With unlimited choices becoming the order of the day, contextual creativity
enables brands to facilitate easier decision making for consumers.
Marketing Myopia as a Classic Strategy

Theodre Levitt (who passed away recently) pioneered the concept of market-
ing myopia decades ago, and it is a very interesting observation (and realiza-
tion as well) that is relevant today, even in the digital age. This also reflects
how old concepts can contribute to marketing practice in a classic way without
becoming fads or fashion. This point is even more relevant to today's context
where the fanfare and glamour of “state-of-the-art” concepts create a feeling
that old concepts have gone down the annals of history. The idea is not to
suggest that new concepts are not relevant. In fact, the recent literature on
customer loyalty and migration open up several conceptual avenues for prac-
titioners of marketing.
The need for brands to be customer-centric

Severe competition, time compression of consumers due to their changing life-
styles and the willingness of at least a cross section of consumers to spend and
be open to a new experience are forcing companies to explore various avenues
to pursue their branding and marketing strategies. In such a situation, it be-
comes worthwhile to look up old concepts with a classic appeal.
Levitt explained that a business (and hence a brand) should have a broader
definition of its business, without being myopic about its markets. He cited an
example that an organization in the railroad business is more in the transporta-
tion business. Today's Southwest Airlines was cited as an example of how the
company had identified a gap in the market that was untapped by other air-
line companies. After the success of Southwest Airlines, a host of other airline
companies have followed this business model. The basic business proposition
of an airline (Southwest Airline) competing with road transport for short haul
distances has its origin in marketing myopia. Marketing myopia can be applied
with a “solution-centric” focus. The need for a complete solution and the changes
in consumer behaviour the world over (including emerging markets like India)
have rekindled interest in the concept of marketing myopia. A relatively smaller
company has the nimbleness to create a business model around the concept as
compared to a traditional company that has been established in the market. For
example, offering a brand of washing powder is different from offering a com-
plete fabric care solution for a target segment of consumers who have different
kinds of usages for different kinds of fabrics. A family has different members—
adults, children, young, old, boys and girls who may use different clothes/
apparel for a variety of situations/occasions. Building a business model for this
specialized segment with the concept of laundering is different from a brand that
competes in the detergent market. In the Indian context, there are already signs
of marketing myopia addressing the emerging consumer segments. Godrej's
comprehensive pest control services is an example of a company that addresses
a need for the solution of pest control while having conventional branded offer-
ings like mosquito coils and other product offerings related to pest categories.
Asian Paints realized the need to involve the consumer in the comprehensive
solution required for beautifying his/her home rather than the consumer's re-
quirement for paints. It introduced a system by which the consumer can get his/
her solution for painting the home without going through the traditional process
of entrusting the work to a contractor who would, in turn, hire his personnel, se-
lect approximate colours liked by the consumer, and provide little guarantee of
the work done, bringing in the process of haggling. The consumer's effort, time,
and the money is wasted, causing frustration that gets enhanced by a bad job
(most of the times) at the end of the process. The whole process becomes a night-
mare and provides less incentive for a household to paint the home at regular
intervals. A brand, in contrast, can not only provide the solution but also an ex-
perience for the consumer. In the Indian context, with the presence of the un-
organized sector in several product categories, providing and communicating
such a solution-based experience is the contextual branding that is required as
compared to the visibility created by the conventional branding campaigns.
The focus of experience-based branding efforts

Companies should start exploring how well consumers are receptive to such
solution-based approaches. There are two broad approaches to the concept.
One is to create a model that would address cross-category competition
(like Southwest Airline competing with surface transports) in terms of price
and flexibility. The other approach is one that can be more readily applied
within a given category (like the Asian Paint's approach) offering convenience
and quality of experience. The scope of this approach is much more broadened
with the distinctive possibility of customization. Higher the customization,
higher is likely to be the interaction with the consumers resulting in relation-
ships that are based on positive experience and trust.
A simple example of making tea to suit individual tastes reflects the effective-
ness of the approach. There are various factors affecting the taste of the tea (not
just the packaged product/brand that we buy from the retail outlet). Similarly,
music is one more domain where such an approach can work in a country with
a market that is probably the second largest in the world and laced with piracy.
Today, consumers have the option to choose from music systems, ipods, walk-
man and the recent concept of World Space that offers a variety of music to a
serious consumer interested in music. Similarly, iTunes (downloads of music)
have been a major hit abroad. A single brand that offers variety in music, with
good quality in terms of reproduction and several delivery options is certain to
be patronized by a target set of consumers for a long time. This is the foundation
for the concept of life-time customer value. The challenge for established brands
is to build a business model around the “experience” that includes both the
tangible and intangible aspects of the offering (incidentally Levitt has also writ-
ten on how the tangibles and intangibles of an offering can be put together as a
market offering). Bigger the market, better will be the prospects of the feasibility
of such an approach even if the niche consumers interested in such an experi-
ence-based approach is small. The mobile phone, with a proliferation of proposi-
tions from several brands, is another category that offers scope for customization
of various segments in ways that are more distinct than differentiation based
on prepaid and postpaid services or services that several consumers may not
require. With almost a hundred million consumers in the market, understand-
ing the needs of consumers and providing the relevant experience can create
immense possibilities for customer loyalty and binding. The trend has already
caught up in beauty and personal grooming categories (Lakme). If beauty par-
lours get diffused adequately among consumers, they can simply make consum-
ers not think about individual brands associated with soaps, creams and lotions.
Consumers of the service economy want variety for change, options to suit
convenience, contemporary offerings to suit their lifestyle changes and finally
a provider who can be trusted not through tall claims but through first-hand
experience. A strategy based on marketing myopia offers all these aspects and
more – to make the offering of the company an eternal brand in the psyche of
consumers.
Consumer Perception and Marketing Strategies

Marketing managers apply the four P's of marketing (marketing mix elements,
namely the product, price, place and promotion) when they want to formu-
late strategies in a competitive environment. In the digital age that symbolizes
speed and dynamic activity, there is more pressure to apply the marketing mix
elements for short-term results. Regardless of the state-of-the-art changes that
are happening in academia and marketing practice, the classic marketing mix
elements provide a strong foundation for any competitive environment pro-
vided they are viewed from a behavioural perspective with focus on the con-
sumer's mindset. About two or three decades ago, marketers may have taken
marketing mix decisions without much emphasis on the behavioural aspects
concerned with consumers; but in today's context, such decisions may prove
to be unhealthy not only to the company but also to brand decisions. While
there are a number of good articles on branding, there are perhaps few that
reinforce the importance of the behavioural interface of the consumers when
they perceive brands and their changing strategies: this is even more vital in
an emerging market like India that throws up unique challenges.
The synergistic approach to branding

Regardless of the product category, there needs to be a conceptual approach to
branding. Before even explaining the approach, there is a need to clarify a few
aspects regarding the misconceptions about branding.
Branding
 is not just about advertising alone,
 is not just about managing events that give it a visibility,
 is not just about price discounts,
 is not just about introducing new categories under the existiing brand
name,
 is not just about logos and colour schemes and
 is not just about frequent freebies announced to attract consumers.
While short-term strategies like those mentioned above are useful to mar-
keters, they need to be integrated into a specific conceptual plan if scientific
branding principles are to be attempted. Marketing mix elements are to be
used in a systematic manner to achieve the goal of having a strong brand.
Sony, Motorola and Siemens are certainly strong brands but Dell and Intel
are stronger brands. While a number of strategies that may not directly be
related to marketing mix elements may have played a part in the success
of the brands mentioned, the basic approach to branding underscores the
importance of applying the marketing mix elements in such a way that it is
integrated into the strategic marketing plan of the company. For example,
Sony is into several diverse product categories (though related to electron-
ics), but Dell is just into personal computers (and perhaps into servers, more
recently). This strategic difference creates a difference in the application of
marketing mix elements. This is because any brand has to create and nur-
ture value and this is not created just by the marketing department, but by
the entire organization. Marketing mix elements are to be applied carefully
to the changing environment and to the changes in the value offered by the
organizations.
A comparison of some of the leading brands of today with those that existed
a few decades ago (in the respective category) will enable us to appreciate the
importance of marketing mix elements in a changing and competitive context.
(See Table 1.2)
Table 1.2  Leading brands of the past and the present—A comparison.
Brands of yesteryear Brands of today
Jawa and Yezdi in motorcycles Hero Honda,TVS
Indian Coffee House Coffee Day
Glaxo (biscuits) Britannia
HMT (watches) Titan
Binny (fabrics) Raymond
Ambassador (cars) Maruti, Santro
Kores (photocopier) Modi Xerox
Behavioural aspects associated with consumers and

marketing mix elements
The basic functional aspect is being provided by the Product. Can a brand in
a competitive environment survive only by advertising? Impulsive products
like cola and chocolates also use behavioural aspects. Himalaya, as a brand,
is a good example where the brand has used the consumer's perception on ex-
isting beliefs about alternative systems of medicine and also strengthened the
perception by its offerings and its approach, to create products that enhance
the brands functional credibility in several categories. Colgate Total uses a
product offering that is perceived to be significantly different from other
brands of toothpaste. With such a clear product differentiation the brand has
added two more P's namely Price and Promotion (the brand has a premium
pricing strategy and it also launched the “12-hour protection” campaign with
a well-known celebrity). Brand image is nothing but a perception in the psy-
che of the consumer and a consistent combination of the P's will ensure that
the brand is favourably perceived by the consumer. Titan's approach to its
brands is a clear example of how the behavioural aspects concerned with
consumers are being taken into consideration. The company has a clear dif-
ferentiation among its offerings—Titan, Fastrack, Sonata and Zylus in terms
of several elements of the marketing mix. Each brand has a clear focus on
the target segment. ITC's foray into biscuits is an interesting example of how
the company is using its massive distribution and retailing clout (Place) to
its advantage. With cigarettes not being consumed as actively as they were a
few decades ago, the company is using its retailing strengths to distribute its
biscuits. After introducing a variant in the category, the company has roped
in a popular celebrity. Biscuit is a snack item among preteens and teens, and
the celebrity holds sway over this segment. Offering variants, celebrity en-
dorsements, acceptable price and availability is the consistency of its brand
Sunfeast. Given the distribution of the company, the brand has prospects of
penetrating deeper into the hinterland. The competitive brand from ITC with
such strengths is launched at a period of time when there are several regional
brands in the category in several parts of the country. Santro and Indica
brands are relatively new to the Indian context. Their design and features
backed up by other marketing mix elements have helped these brands to win
over the consumers within a short span of time. Both these brands continue
to introduce brand variants to sustain their success. Fair & Lovely created a
host of offerings in response to competition in recent times. Herbal variants,
creams with vitamins and cream for the night to restore the skin (Perfect Ra-
diance) provide a platform on which other elements of the marketing mix can
create a significant brand image. LG and Samsung are examples in washing
machines and televisions respectively, that reflect the importance of value
of the offerings to consumers. These brands were late entrants in these cat-
egories that consisted of several well-established brands that already had a
strong equity among consumers. LG was also perhaps the first brand to cre-
ate a powerful sales structure in the rural/semi-urban markets of the country.
Companies in the cellular phone market would do well to provide specific

value addition that is relevant to the respective segments. There is an oppor-
tunity in several segments in this market for brands to develop a favourable
perception among the consumers. The diversity of usage patterns, the pres-
ence of symbolic appeal associated with the category and the innovation hap-
pening to the handsets provide creative scope for conceptual strategies.
A company can have the best of technologies and products but branding
requires an adept approach in coming to grips with the changing consumer
behaviour. Branding is a science that gets converted into an art in the psyche
of consumers: marketing mix elements provide meaningful linkages between
the two worlds.
Branding Commodities—Conceptual Linkages

The penetration level of several branded commodities has been very low con-
sidering the overall market size for such commodities. Rice, atta, sugar, anti-
septic lotion and floor-cleaning liquids are some of the categories in which
branded commodities are not penetrating in the market. In some of them like
anti-septic lotions and floor-cleaning liquids, the frequency of purchase, by it-
self, may be low. Behavioural aspects could provide some insights to marketers
to overcome the challenges posed by such categories in which branded offer-
ings are being introduced. Parry sugar, Nestlé curds and Dettol floor-cleaning
liquid are recent introductions in such commodity type of categories. The con-
cept of branding versus commodity, target segment considerations and the
concept of involvement levels of the target segment are some of the important
aspects that drive the concept of branding commodities.
Commodity versus Brand

Commodities are offerings that are priced competitively, and the branding
of these should provide value to consumers. Besides, the brands should also
use a conceptual approach towards conveying the value of such offerings.
What is interesting is that unlike the developed markets where branded of-
ferings compete with retail brands (even in the Indian context there may be
a few retail brands but organized retailing is an insignificant part of the re-
tailing), the branded commodities compete with home-made substitutes that
have a cultural flavour or with offerings in the unorganized sector in the de-
veloping markets. Therefore, the target segment selection and the meaning
of value to them is critical, as they form the foundation on which communi-
cation is built up.
There is one aspect that needs to be understood about commodities. As
stated earlier, they are competitively priced and brands create a perception
about superior performance of their product attributes as compared to un-
branded commodities. These commodities could be found in any category
in which competitive branding has not developed. Rice and sugar are ideal
examples of brands just evolving in a huge market driven by price. For ex-
ample, the branded atta market is just 2–3% of the entire market.
Target-segment-related considerations
Normally when brands get developed in a market that has been hitherto
a commodity category, either there is an advertising plan or a discount-
based trial where the brand is offered to consumers at a lower rate. Another
route is to introduce the offering in large retail outlets with a special counter.
Very rarely is there a concerted effort to formulate a marketing mix plan
taking into account the fullest potential of the target segment that may be
interested in the branded offering. A long-term approach will be to sustain
the initial purchase, and the data about target segment are vital. A brand
that is a pioneer in a given commodity category will not be interested in a
short-term orientation of approaching a target segment that may not offer
a long-term potential for the branded offering. A brand of vegetable deliv-
ered fresh to consumers (some companies have attempted branding in the
vegetable category, but without much success due to a variety of reasons)
or a brand of rice can concentrate on how chemicals are not used in the pro-
cessing of such products. This approach is likely to be useful, as environ-
mental degradation and usage of chemicals is a topical issue. But even with
this approach, the target segment issues are important. Psychographics is a
useful tool to identify the target segment and this would have far-reaching
implications on the formulation of marketing mix as it provides useful leads
to reach the target segment in a consistent manner. Dettol's example is an
interesting one. It has launched the floor-cleaning liquid and the advertising
emphasized the need to use such a brand to prevent the frequency of illness
leading to happiness within the family. While the advertising makes an ef-
fective point, there should also be an attempt by such a brand to identify a
target segment, which is health/fitness conscious. Psychographics can help
in identifying the activities (going to health clubs or buying appliances that
preserve nutrition like a special refrigerator or a water purifier that ensures
safe water protected from bacteria) or garnering opinions about hygiene
in various facets of life. It is interesting to note that this kind of segment
is quite different from consumers who may buy such a brand because it is
heavily advertised or because the brand is launched with a discount. Once
such data are procured, reaching the target and conveying the value of the
offering will take on approaches that are very different from the conven-
tional route of mass media advertising. For example, households that are
more likely to have a personal computer could be reached through a Web
site. Several creative contests can be run to get the consumers' traffic at these
Web sites. Another important aspect to be noted is that this kind of segment
will buy the brand purely because of the intrinsic benefit and are likely to
be price-insensitive (not the typical bargain hunter who goes after just deals
and where the trial of the brand is incidental). An emotional appeal is also
likely to add to the product attribute of the brand. The Dettol advertisement
mentions that it is the role of the housewife to monitor such aspects, add-
ing to the self- worth of the housewives. The emotional appeal is appropri-
ately brought in by showing the school-going boy who is unlikely to fall fre-
quently ill, with clean flooring made possible by the brand. Schooling and
studies of wards rank very high in the priority list of parents. Saffola Gold
also uses the housewife as the “protector” of her husband (an off-shoot of
a segment that believes in a healthy lifestyle with an overtone of emotion).
In the US, a company marketing caskets (coffins, a product category that
did not have brands at that time) established itself as a brand by appealing
to the emotions of consumers, asking them to give a decent “final farewell”
to their loved ones by using their brand, which was advertised with some
technical attributes. This example may be the ultimate usage of emotion in
selling a commodity but it drives home the point of how various aspects
including emotion are useful in elevating the commodity status of an offer-
ing to the brand status. The target segment also plays a role in the extent
to which emotional appeals should be used. A brand of motor oil that was
addressing the target segment of drivers of trucks suggested that as a part
of the sales promotion, a buyer could have an insurance policy with some
terms of conditions, on buying the brand. The message had a negative emo-
tional connotation as insurance, in the minds of the target segment, was dir-
ectly associated with death, a bad omen (a value associated with their way
of life). Imox, a brand of stainless steel products for household use (from
the Jindal group), was retailed through Lifestyle and Shoppers' Stop outlets
reflecting the up-market nature of the product (the brand is also available
in other selective outlets). The brand was also trying to establish itself in the
commodity category of motor oil a few years ago. Target segment psycho-
graphics, the brand's message on attributes and an appropriate emotional
overtone form the basic foundation for branding commodity.
Involvement levels and commodity branding

Commodity buying happens on just price and hence involvement levels will
have to be heightened among the target segment to ensure that they notice and
buy the brand. Involvement levels, in simple terms, means creating and nur-
turing a degree of personal relevance between the brand and the consumer. In
commodities that are fast moving consumer goods, low involvement levels are
to be harnessed to create and sustain the interest of consumers. There are three
stages in which such involvement levels occur. The first stage is the “thought
process” stage of the consumer, where the brand is associated with the beliefs
of consumers in a favourable manner. Coconut oil has been traditionally used
for centuries by consumers, and it is only in recent times that various brands
have become associated with it. The Parachute brand emphasized the aspect
of purity and substantiated it with its effective packaging and logo directly en-
tering the “thought process” stage of the consumer who has all along believed
in the goodness of coconut oil for hair. After getting itself established in the
category, it created the jasmine variant, based on the cultural value associated
with the flower. This increased the good will of the consumer since the brand
was now available in a favourite and culturally familiar variant, thus adding
to the involvement levels. This is a good example to show that a conceptual
process enables advertising to communicate the required benefit and to cre-
ate a brand in a commodity category. When the brand wanted to focus on the
urban youth segment, its advertisement mentioned that the offering can be
applied before a regular bath—in tune with the “thought process” that for the
urban lifestyle followed by the young, the “no oil” look is the “in-thing” in
personal grooming. The next stage in the involvement process is the “trial and
experience” stage where the consumer tries out the offering after “accepting”
the brand in the previous stage. The product attributes of the brand come into
play at this stage and it is important for the brand to live up to its promise.
The efforts of the previous stage will be wasted if the consumer does not ex-
perience the benefit, which differentiates the brand from commodity in spite
of the consumer paying a higher price for the offering. Reynolds pen is a good
example of how the brand won the confidence of consumers in a category
that was a commodity at the time when the brand was introduced. Ball pens
were largely sold from the unorganized sector (there were some high-end of-
ferings at the higher price segment) and they were not of good quality. Reyn-
olds charged a premium but offered a pen that had a sleek design and the one
that offered a smooth writing experience. Kohinoor basmati rice offered good
product attributes that offered a superior consumption experience to consum-
ers. The experience offered by a brand in a commodity market should be dis-
cerning to the consumer. A strong differentiator has to be built at this stage of
“trial and experience.”
The last stage is the “sustained feeling” stage in which the consumer feels
that the brand is able to sustain its branding efforts. If the brand is successful
in the first two stages, the consumer will have a positive word of mouth about
the brand. Sustaining the good feelings associated with the brand over a pe-
riod of time is the challenge to the brand that has successfully positioned itself
in the commodity category. A relationship with the consumer is built only in
this final stage and the brand has to carefully devise a relationship program
with its consumers. The database of consumers will also be useful to devise
such programs. Another strategy is to develop several productlines/variants,
which reinforce the competence of the brand. Himalaya, the company that
markets over-the-counter traditional ayurvedic products, has developed a
number of products based on scientific research over a period of time and it is
a strong brand in terms of consumers' perception of its product attributes. The
company has developed products in several categories of personal grooming/
other medication and most of them are safe enough to be sold over the counter
without the prescription of doctors. The rigour associated with the develop-
ment of products, the variety offered, and some of the products in the variety
are new to a market like India and adds on to the credibility of the brand.
Branding of commodities requires conceptual and consumer insights; such
an approach will ensure that the pioneering brand gets the best mileage for
being the forerunner in the category.
Price Discounting and Sales Promotion—Its

Implications
With the freebies and discount culture spreading widely in the Indian con-
text, brands should take into consideration the possible implications before
embarking on a discount strategy either for the long or short term. Price dis-
counting not only affects the profitability of brands but also the equity of the
concerned brand. For example, the kind of impression that would be conveyed
to consumers when two major brands of detergents cut their prices by signifi-
cant levels, is an important implication from the viewpoint of marketing.
Why discount at all?

There are many reasons as to why brands offer discounted prices and sales pro-
motions that include freebies. With competitive pricing and communications'
clutter reaching new heights during recent times, consumers seem to eternally
shop for either sales promotion buys or lowest prices. With fragmentation of
retailing, profit cut to the bones and consumers' involvement with prices, mar-
keters, especially those associated with fast-moving consumer goods, seem to
have little option but to cut prices or to offer some kind of “value addition” to
the buying spree of consumers.
 The lower-end and the middle-end consumers (in terms of household
income) are predominantly oriented towards such discounting and sales
promotion as they have tight monthly budgets. It should be noted that
not all of them even receive a monthly salary. Some may be paid weekly,
some daily and some even by the number of hours in a day. Aspiration
levels enhanced by the advertising blitzkrieg, come into play with these
kinds of segments. Branded offerings are preferred by this segment but
they may not always be in a position to afford them. It is common for the
lower segment to use offerings from the unorganized sector and these
consumers buy branded offerings at a lower frequency than their middle-
end counterparts. There may be a huge base of consumers who may be
alternating between branded offerings across product categories over
a period of time. They may try a branded tea during a week and when
money is spent on a branded fairness cream for example, in some other
week, they may balance this expenditure by using loose tea. Hence, dis-
counting and sales promotion is likely to drive such consumers towards
greater usage of branded offerings.
 Modern retailing (though accounting currently for only about 2 percent
of the total retailing market in India) has to step up footwalls of consum-
ers belonging to middleclass/upper middleclass by offering unique
bundles of sales promotion. In fact this aspect may be a compulsive rea-
son for shoppers to visit the departmental store. A consumer may plan
for “an unplanned impulse” in a departmental store known for offering
such bundled sales promotion. The consumer gets used to sales promo-
tion at the store and expects to take advantage of such a promotional as-
pect though not being clear about what is likely to be on offer when he/
she makes a visit. The consumer may not find such attractive offers in his
usual neighbourhood kirana shop that has been servicing him/her for a
long time.
 The thrill of a compulsive buyer, regardless of the socio-economic class
the consumer may belong to, lies in “striking a good deal” and a unique
sales promotion triggers the urge of such a consumer, providing him/her
the joy of shopping.
 Introductory offers with either discounts or sales promotion enables the
consumer to try out the new brand in a familiar category. A brand of
new cookies can create trials through such offers. Trial is necessary for
any new brand, and a new brand has the disadvantage of not having an
equity enjoyed by well-established brands. Sales promotion can bring
in consumers, who otherwise may not have been willing to try the new
product. Dettol's liquid handwash or a trial offer from Heinz ketchup is
likely to attract consumers who may not have even been regular users of
these categories (with penetration levels being low for these categories).
 Sales promotion creates excitement and involvement among the target
segment. Sunfeast is relatively a new brand of biscuit. Besides its strong
celebrity endorsements and distribution strengths, the brand's associ-
ation with tennis and contests for children (with the possibility of winners
being ball boys/girls at international tennis tournaments) creates tremen-
dous excitement in a mundane category.
 Rewarding the current owners of the company's brands is one of the im-
portant aspects of a sales promotion, especially with categories of dura-
bles that have a lengthy inter-purchase or replacement cycle. Maruti in the
category of cars, uses this approach. It has even extended this approach to
other brand owners who would like to convert to its Baleno model.
 A company entering the market late in durable categories can alter the
consumer preference pattern significantly with an appropriate and
powerful sales promotion/exchange offer. Akai, when it entered India, re-
alized the potential of replacement cycle in the country for television sets
and also the potential for used second-hand sets in the country. It used an
exchange scheme that literally created a market for 29-inch television sets
in the country.
 Besides value-oriented and price-sensitive consumers, cultural factors
also create an environment conducive to sales promotion not only in
India but also in most parts of the world. The Christmas season heralds
a spate of sales promotion offers in developed markets. Festivities in the
Indian context are accompanied by offers and sales promotions made as
part of the celebration, as shopping is a part of the culture during such
occasions. Consumers seem to be attracted to a variety of sales promotion
offers (for example, buying one piece of apparel and geting one free, fill-
ing up free petrol when buying a two wheeler).
Brand associations and sales promotion/price

discounting
A brand should integrate its sales promotion and price discounting schemes
into its overall branding efforts to ensure that the exercise is not counter-
productive to the long-term interests of the brand. For example, a retail outlet
repeatedly having price discounting just for the lower segment of consum-
ers may be strongly categorized by consumers as a “cheap store.” A brand
of snack food offering discounts for an extended period of time may attract
consumers only when the discount is on and not otherwise. This may lead to
the erosion of value offered by the brand. A premium brand like Samsonite or
Park Avenue may offer a promotion for a limited period, timing the offer with
a festive season to ensure that the brand equity is not affected.
A brand like Himalaya (over-the-counter herbal remedies) may offer sales
promotion on its selected products instead of on all products for a limited pe-
riod of time. Such an approach would ensure that the brand value is reinforced
and the focus of consumer perception would always be on the intrinsic value
offered by the brand.
Timing, relevance to what the brand stands for among the target segment
and how well the promotion blends with the overall brand association are
some of the prerequisites for a price-off/sales promotion offer.
Perceived Risk and Branding

Emerging markets like India are unique. Unorganized markets in several cat-
egories, low penetration of categories themselves and a huge mass of consum-
ers at the lower end of the society are some of the reasons why companies
should address perceived risks, to build strong brands that gain consumer
confidence
With consumer markets opening up with several product and service cat-
egories, one of the important considerations that requires a mix of concepts
and marketing practice is the facet of perceived risk while dealing with con-
sumer products. Perceived risk, in the psyche of consumers, poses several
interesting questions as well as challenges for the marketer. The following are
some of the questions that the marketer needs to answer if there are issues con-
cerning perceived risk:
 What kind of perceived risk is relevant to a given product category?

 What are the perceived risks associated with new concept products?
 Can perceived risk vary according to the target segment?
Product category and perceived risk

The basic fact is that consumer durable categories will be associated with greater
perceived risk than fast-moving consumer goods because of the price factor
involved. But there could also be factors beyond the price-related risk, which
deals with the value (in terms of functionality) associated with the product.
A hair colourant has a social risk associated with it. There is apprehension in the
mind of a consumer about whether the promise of colour and its impact on his/
her appearance will result in proper social approval. The image and self-esteem
of the consumer are associated with the product category. It is in this context that
the brand name provides reassurance to the consumer on the outcome of prod-
uct consumption. A computer institute that advertises its courses has to address
the placement risk associated with the outcome of going through the course.
Such risks increase if the service advertised is something with which consumers
are not familiar. A few institutes that advertise their air hostess courses make
a mention (of the placement potential of their courses to reassure the candi-
dates) about the positive outcome of the course. Hospitals brand themselves
to address the perceived psychological risk of patients. Such brand building
(not necessarily through advertising) is helpful, especially when consumers do
not have much expertise in the given service/product category. Even in a fa-
miliar product category, a well-known brand can help the marketer to establish
confidence in the mind of the consumer when the brand has a new offering
about which consumers have no prior idea. Citizen's Ecodrive watch is a good
example. Being a new concept in watches consumers perceived risk would have
been far more greater without the familiar brand name. When consumers have
a perceived risk about safety (physiological risk), branding is vital. It will be
interesting to note that in a category like talcum powder for babies, Johnson &
Johnson has been having the stranglehold over the market for several decades.
Though the sub-category is a niche market that commands a premium, several
other brands (including Pond's) have not been successful in the Indian context.
The target segment consisting of “mother as the consumer” is unwilling to try
out any other option when the brand has been perceived to be safe for several
decades. A well-known brand of medicine usually taken for fever was found to
be inadequate on several medical parameters by a reputed product-testing as-
sociation. But in reality, several consumers were likely to stock the well-known
brand of medicine because it has been perceived as the “best” by doctors and
consumers for the last several years. Glaxo, at one point, was producing two
brands of milk substitute for infants—one in Glaxo's name and the other with
some other brand name. Consumers bought Glaxo in large numbers in prefer-
ence to the other brand because of the aura of assurance presented by the brand.
Branded offerings, in several categories of products, offer value but in certain
“sensitive” categories where consumers strongly perceive usage/performance/
other risks, brand names also offer an intangible value, which is reassurance
about the ability of the brand to tide over the perceived risk.
Value-based perceived risk is something that is part of the normal buying
process, and it has a focus on the tangible aspects of the offering from the view
point of the consumer. The other kinds of risks are more associated with the
intangible but positive power of branding, wherever the product category is
appropriate.
New concept products

There is a difference between products with which consumers are familiar and
those that are new to consumers. The fundamental aspect is that if these new
offerings are substitutes to the existing offerings, then these offerings solve
a problem that is not addressed by the current offerings in the market. For
example, ATM is a new offering and to a great extent substitutes the service
at the banks if money withdrawal is considered. The consumer can withdraw
money any time from several locations. To analyse the perceived risk associ-
ated with such an offering the target segment has to be taken into consider-
ation. The upwardly mobile, who are engaged in high-paying jobs and those
who have a compressed time schedule during office hours will perhaps have
little perceived risk as against retired pensioners who also need to draw money
frequently to manage their expenses. Fear of the machine not working, appre-
hensions about getting used to the operation and more than anything else,
not having human contact as in a bank are likely to discourage such segments
from making use of the machine.
Diffusing durable categories

If a product like a dish washing machine is considered, even the urban seg-
ment similar to the one that is receptive to ATM is likely to be resistant to the
product due to several reasons. Though such a machine is a poor substitute
to the manual labour normally employed at homes, it offers several other
advantages over such a substitute. It can be used anytime and it does not
depend on the time during which manual help is available. The first risk is
value risk. Would it offer as much value as indicated by the initial price of
the machine? Another risk is about the performance of the machine. Would
it perform as dependably as manual help? Usage risk is another kind of risk.
Would it be easier to use, or will using the machine be complicated? With
these kinds of risks, it is usually a small percentage of consumers, classified
as innovators, who try such a product. How could an unknown brand tackle
such risks? Selling the concept and carefully locating the target segment is
vital because the word of mouth about new products is crucial during the
initial phases of launch. The washing machine market, though a limited one,
has grown in urban markets over the years. This product was completely
a new offering when it was introduced a few decades ago. In contrast, the
vacumizer (a product introduced by Real Value Company to preserve food
in its original flavour) did not take off at all. When such new offerings are
introduced, it is imperative to find out how the product is likely to be useful
to the maximum extent to a specific segment. This requires careful analysis
of several segments. A dish washing machine is likely to be useful to a high
double-income family, which has a busy lifestyle both on working days and
on weekends. It resides in posh residential areas where manual help is dif-
ficult to hire or unsafe because of security reasons. The family requires the
dishes/utensils to be washed at short notice, and also uses a variety of uten-
sils ranging from the traditional ones to microwave-compatible ones. Being
in the higher income bracket, such a segment will also be price insensitive
provided the product offering is a good one. Due to the demands that need to
be met with regard to dishwashing, this segment is likely to perceive a better
value in a dishwasher than a typical higher-middle-class family that lives in a
neighbourhood, where employing hired help for such household purposes is
almost part of the culture. Performance risk and value risk (based on both the
result of using the machine and dependability of the machine) are the ones to
be addressed if such a segment is to be approached for marketing the prod-
uct. Product demonstration during the presale phase is a good way to start
the marketing effort after the target segment is identified. Door-to-door sell-
ing is one of the methods but given the time pressure of the segment and the
need for privacy, this method may not be the best alternative. Besides, adopt-
ing this method for an unknown brand may not be a value adding approach
as consumers may be even less willing to entertain a sales person when he is
associated with an unknown brand. The brand should demonstrate at high-
end outlets visited by the target segment for making their purchases, though
for different categories of products. This is a situation where an unconven-
tional approach to retailing is likely to work to the benefit of the brand. Fol-
lowing up on the leads generated through demonstration and ensuring com-
plete satisfaction with the brand—right from usage aspects for best results
to post-care service for the product is likely to be effective in spreading good
word of mouth. The higher-end segment, today, is exposed to several kinds
of information and the conventional advertising with the claims of the brand
may not be as effective as the convincing word of mouth, perhaps from a
neighbour or a colleague at work.
The innovators (in this case, consumers who initially try out the product)
have to be given extra attention as they may be opinion leaders—consumers
who are approached by other prospective consumers with regard to the new
product offering. What is to be remembered by marketers is that value of a
product new to the market is defined by the target segment and it could be
the convenience, saving of time or anything that will enable them to make the
quality of life better, given their lifestyle pressures. The value may not just stop
with performance or functionality, viewed in the traditional sense.
Intention to buy matters

There may also be consumers who may try out the product during the dem-
onstration stage or follow-up stage but who may not buy the offering. These
consumers offer a rich source of information concerning the reasons for re-
sistance associated with the new offering. A consumer may not purchase
the offering because he/she may feel like waiting till the offering gathers
ground among a significant number of consumers. In an emerging market

like India, given the low penetration levels of even products with which
consumers are familiar, the intention to buy is a strong factor in favour of
the brand. Consumers who have a strong intention to buy but who may not
like to be innovators have to be approached in a different manner. They may
perhaps like to interact with satisfied consumers: they may have to be con-
vinced about the seriousness of the brand through specific information on
manufacturing or the support infrastructure created by the company. There
may be another segment that has been experiencing bad word of mouth
not about the brand but about the category itself, and the company should
attempt to create the intention to buy in the minds of such consumers.
For example, introduction of electronics in several products/devices like
cars, washing machines and electric cookers initially created apprehensions
among consumers. When Kinetic Honda introduced the initial version of
its scooter (which incidentally was not the first offering in the scooter cat-
egory), there were apprehensions about its suitability for Indian roads and
the company sponsored an event associated with a rally to the Himalayas to
build the brand's credibility.
Addressing perceived risk depending on the needs of a specific segment
requires in-depth information about the segment and it also requires a well-
planned approach. Direct marketing and selling can be a part of the approach
after the intention to buy the new offering has been established in the mind
of the prospective consumer. Perceived risk is an area where the conventional
marketing mix elements could be used in an unconventional manner: chang-
ing environment demands a creativity of that kind.
The Power of Brand Associations

Consumers connect not with products but with brands. They form powerful
linkages with brands, sometimes to the extent of simply selecting a brand that
is familiar to them. Brand associations can be extremely useful to marketers in
several aspects.
Red Label is a tea that has been in the country for several decades. Lux and
Liril are also brands that have been around for decades. How have the brand
associations of these brands changed over a period of time? In recent times Lux
has launched several variants and Red Label has introduced its herbal variant.
How should brand associations be managed when variants are introduced?
How should advertising campaigns be managed to ensure that carefully de-
veloped brand associations are not contradicted by the new associations cre-
ated by contemporary advertising campaigns? These questions are becoming
more relevant to the Indian context. Well-established brands compete with
several new brands in a variety of categories and the established brands seem
to be losing their stronghold. Long-term brand associations matter to a brand,
especially after it registers success and hence, managing these associations is a
vital part of managing a brand.
Importance of brand associations

Brand associations have strong linkages with consumer perception. A con-
sumer attaches a meaning to a brand based on the brand communication.
The Fasttrack brand of watch may be associated with a young, urban and
hip association. Dove may be associated with a sensual and delicate moistur-
izer bar rather than an ordinary soap. The two-wheeler bike Pleasure may
be associated with a modern vehicle for young women through its celeb-
rity-based advertisements and the type of retail outlets the vehicle is sold
through.
While a brand has to update its offering to remain competitive in the mar-
ket, it has to ensure that the associations created over a period of time do not
clash with the original association of the brand. This is as much a challenge to
the marketer as creating and sustaining the brand value reflected through the
intrinsic offering of the brand.
There are two aspects to this challenge of brand association—one, to cre-
ate brand imagery or association that would support the original association
and two, to create an association that would reflect the changes with regard
to the value of the brand. These changes are brought in by the brand to make
its offerings appropriate to the changes needed by consumers. For example,
the Ujala brand of liquid blue (used for whitening clothes) created a clear as-
sociation for the brand though it was not the pioneer in the category. Robin
Blue was the pioneer in the category. Britannia's Tiger biscuit created a healthy
association (using celebrity advertisements too) in a category where such an
association was activated or sustained by brand names. Such associations be-
came very relevant to the target segment (lower end of consumers in terms of
income and lifestyle levels) as this segment consumed the offering as a part
of the eating culture. Tea with some biscuits, is almost a staple breakfast for
several individuals at the lower end, and a branded offering that reinforced
nutrition and energy was very relevant to the culture. This is an example of
creating a brand association that is very relevant to the target segment. A sec-
ond example that illustrates the use of brand associations to capture the dy-
namic changes a brand undergoes over a period of time is the case of Hero
Honda motorcycles. The brand created the CD 100 model when it entered the
Indian market during the mid-eighties and positioned the bike as “Fill it. Shut
it. Forget it.” clearly emphasizing its economy proposition (that was almost
double the mileage compared to competitive brands at that time). The com-
pany has introduced several models after this in a span of about twenty years
with several features and benefits but has taken care to ensure that the brand
associations are contemporary and clear enough to differentiate the different
models. It has used the concept of sub-branding (introducing sub-brands to
the mother brand Hero Honda). The mother brand provides the assurance and
credibility associated with the original meaning while the sub-brand provides
the contemporary meaning. Honda SS, Honda Passion, Honda Splendor and
Honda Shine are some of these examples. While it may not be always neces-
sary to make use of the sub-brand to make the brand contemporary, they are
useful if used in a judicious manner (too many sub-brands within a short time
may confuse the consumer in terms of associations and differentiation).
New brands and brand associations

Brand associations matter when new brands are launched, especially in new
categories or new concept products (in a given market). Kelloggs entered India
and created awareness about cornflakes. The brand's initial campaigns high-
lighted how traditional eating habits were not very nutritious and how the
brand's cornflakes can be had as breakfast as a nutritive option. Culture is a
very strong factor associated with consumer groups and any brand should be
careful about how culture is addressed in its communication campaigns. Eat-
ing is a part of the culture and further Kellogg's cornflakes were far more ex-
pensive than the regular breakfast that most people have in their daily life. This
could be compared with the launch campaign of Quaker oats in India. Oats is
also not a part of the eating habits of people. The advertisement for Quaker
oats highlights its protein content, fiber content, its naturalness and subtly
mentions that it can be had for breakfast to provide energy. The advertisement
also mentions that the product is available at a price of Rs 25. Both the brands
have followed different approaches towards creating brand associations. When
such new product categories are being introduced especially in a culture that is
unfamiliar with these product categories, brands should develop and nurture
brand associations that will be useful to them over the long term. A brand in
this situation has to develop an association acceptable to the target segment,
enlarge the market and also ensure that the association is nurtured with strong
differentiation from competitive brands that may follow suit. Maggi noodles
developed a “2-minute quick snack” association when it was launched, though
noodles was not a part of the Indian eating culture. Lipton iced tea is develop-
ing a strong youth association as the target segment is exposed to western ways
of lifestyle and is likely to be more receptive to the new concept than to the con-
ventional segments for tea. Parachute's approach to brand associations is an
example of how the brand is able to create successful associations in a category
that is very traditional. Its variants have a clear association that is relevant to
the respective target segment. Its hair cream has created the “after bath” associ-
ation. The category of hair cream is several decades old and the brand has been
able to trigger strong associations that have appealed to the target segment. Its
variant Sampoorna has a traditional, herbal association.
Importance of brand associations for pioneering

brands
Iodex, Horlicks, Cadbury's, 5 star, Lifebuoy, Cinthol, Close up and HMT
watches are some of the well-known brands that had or still have a dominant
presence in the respective category. The challenge of maintaining an effective
brand association is quite complex for such pioneering brands. On the one
hand they need to develop new kinds of offerings, and on the other they have
to maintain associations when competition is creating newer associations
from the view point of the consumers. One vital decision to be made is on
the impact of different brand names (or maintaining the same brand name
for a number of variants). Sunsilk brand of shampoo has created the benefit
association (cool, shining or such benefits) across variants rather than using
different brand names or sub-brands. The company also has Clinic All Clear
with an association that is distinctively different from Sunsilk. Lifebuoy, after
its re-launch, has created distinctive associations for its variants using the in-
gredients of the soap.
Consumer perceptions, clarity of differentiation and meaningful innova-
tive associations that can be sustained over a period of time are some of the
important considerations that need to be taken into account when a brand cre-
ates its associations.
The Enigma of the Three C's—Culture, Cricket

and Consumers
The drums of destiny, like in several facets of life, uprooted the dreams of
several millions of Indians in the recent World Cup. If the mass hysteria ex-
pressed at the outcome of Indian cricket was unprecedented, marketers are
shocked at the mystery of their well-planned “brand-cricket” associations
going awry. While the current setting is perfect for several academic case
studies, it may be worthwhile to discuss the practical implications of such a
fall out on marketers.
The beginnings
There are three aspects to be considered before the approach towards planning
“brand-cricket” associations are discussed––the past context in which cricket
celebrities were used, the changes in consumer behaviour and the present day
context in which celebrities are used. Cricket celebrity usage probably dates
back to more than three decades on the timeline. Kapil Dev's “Palmolive ka
jawab nahin” for Palmolive shaving cream (those were the days when gel
and brushless creams were not available) was the most memorable as echoing
throughout the country's cinema halls. Sunil Gavaskar also endorsed the same
brand. Andy Roberts of the West Indies appeared for Erasmic blades. After the
TV era began during the early eighties, cricket celebrities cast a mystic spell
on consumers/masses, one that stays irreversible till date (post World Cup?).
The mindset of people has always been tuned towards the sensual aspect
of any sport from the time of the coliseums of Rome to that of the picturesque
cricket fields of England. The hedonic pleasure-oriented appeal of any sport
coupled with the glamour of celebrities and consumerism created a new iden-
tity for the consumer across socio-economic classes.
Consumer behaviour and sports celebrities

Cricket, as well as the celebrities associated with the game have become a part
of the Indian culture. Several countries all over the world have some sport or
the other as a part of their culture – as reflected from the cult-like following
of the fans of Manchester United to the soccer violence being witnessed fre-
quently in those countries where the sport is a rage. Cricket, as a game, has a
long history of being a part of the Indian culture with regional celebrities hog-
ging the limelight at a local level rather than at the national or international
level, as currently observed. M. J. Gopalan of Madras, Hazare and Vinod
Mankad of Bombay were stalwarts of the game who had probably ignited the
celebrity status for the players of the game long ago. More than the celebrities,
the game was a part of millions of households (though the number may be in-
significant as compared to the present day numbers). The game's appeal had
the nuances of the game as its essence.
Television technology and the need for entertainment in an increasingly
high-pressure commercial world brought in millions of viewers to the game,
more as a means of hedonic entertainment pleasure than as a hedonic pleas-
ure resulting from being a connoisseur of the game. This difference is prob-
ably important in tracking the passion and rage associated with celebrities of
the cricket field, which exists in the present-day context. Cricketers were ele-
vated to celebrity status probably during the eighties, especially through the
diffusion of TV channels throughout the country much before the satellite TVs
appeared on the scene. Cinthol with Imran Khan and several advertisements
endorsed by Sunil Gavaskar (from suiting to television brand) were just the
beginning of such celebrity ads. The celebrity status of cricketers amplified
by the multi-sensory experiences involving good visuals and jingles brought
in millions of viewers “overnight.” Cricket celebrities became icons, and en-
dorsement of brands by such celebrities became the order of the day.
While the practice of following the personal life of celebrities may have
been there since time immemorial, television sets made this habit almost an
aspiration among the youth. Mega brands, as a next logical step, started using
mega events like the World Cup as a context to strongly link their brands with
the event. There were also product variants like Pepsi Blue (and Pepsi Gold
for the recent World Cup) to add to the sensory experience, with consumers
associating the consumption experience with the event (either consciously or
unconsciously). Fair & Lovely creatively linked the changing culture (of the
confident, urban consuming class woman aspiring for a career) with cricket by
roping in a cricket celebrity. The historical aspect of the culture associated with
cricket was given a contemporary angle with the aspiring woman becoming a
successful cricket commentator (a field dominated traditionally by men).
Today's context
In the present-day context, there have been several strategies by brands to cap-
ture the attention of consumers during mega-events like the World Cup.
The passion is so much towards the game today that a cross-section of

consumers buy/update their television sets during the mega-events, and
brands specially run promotional offers during the season. The promotional
offers may not just be limited to discounts but may extend to provide free
tickets to the venue of the event. Celebrities from the cricket field are also
used with brands to influence the purchase process of consumers. A recent
addition to the typically “considered decision-making” categories that use
cricket celebrities is real estate. The charisma of cricket celebrities is useful
to attract consumers across age groups and categories. It is just not that only
during mega-events cricket celebrities need to be used by brands. Jam spread
is a low penetration category and a brand used a cricket celebrity.
Although a low-cost product, such a strategy like the one mentioned above
will enable the brand to achieve trial rates. This is essential to enlarge the base
of consumers for the category, even assuming that a small cross-section stays
with the brand/category. TVS Vector positioned itself on a number of attri-
butes/benefits topped up by a celebrity. The same celebrity, Sachin, endorsed
Colgate Total's “12-hour germ free” proposition. The basic approach in using
cricket (or other celebrities) is to plan how well the celebrity association (with
or without the mega-event) fits in with the brand's overall communication
strategy. Integrated marketing communication (IMC) that aims to provide a
consistent set of associations for the brand over a period of time is a useful
concept for a brand when marketers plan celebrity/mega-event associations.
Planning mega-event associations for the brand

 Objectives of the attempted association with the mega event should be
clear. Is it to create brand awareness, brand excitement or to sell a con-
cept that requires the consumer to experience the benefits of a brand? In
such a case, should sales promotion should be a part of the mega event
association plan? (Like for example, a private brand of dish antenna with
a set-up box)
 What is the extent of celebrity usage? Pre-event or post event? Is it just to
capture the attention of consumers or to provide a personality association
to the brand? For instance, a consistent, cool-headed and non-pretentious
batsman can add a “reliable, friendly and confident” personality to a
brand.
 Choosing the game/sport is equally important. One day cricket, with all
its vagaries and unpredictability, may not be appropriate for a new brand
attempting to create sports association. The costs of failure/risks are too
high for the brand. An established brand can certainly take some rude
shocks.
 Target audience considerations are also important. While a brand of fair-
ness cream for young girls can associate itself with cricket with a well
planned theme, it is doubtful if the brand would want to associate with
an event like World Cup, despite the fact that female anchors are getting
popular. Opportunities with regard to qualitative effectiveness as well as

metrics are important in choosing the mega-event.
The quirk of enigma associated with mega-events can be greatly reduced
by basic uncomplicated conceptual thinking, reminding us of the power of
simplicity in a complicated world.
Hedonism—The Universal Marketing Appeal

Experiential marketing is currently a very topical issue among marketers. This
concept has a strong linkage with the concept of hedonism found in marketing
literature about three decades back. Multi-sensory consumption of both prod-
ucts (cola) and services (entertainment), fantasy appeals and emotional aspects
of consumption are all associated with hedonism. In today's context, almost all
consumption in developed markets like the U.S. and Europe is highly orien-
tated towards hedonism, from the design of passenger cars to the enjoyment
of gourmet and entertainment. Understanding the importance of hedonism
will enable marketers to design and position their offerings. Hedonism is one
of the most powerful appeals as it is concerned with the sensual gratification
of the sensory organs. In today's context, hedonism is concerned with how the
products can appeal to the sensory aspects of consumer experience with or
without the functional/benefits proposition.
Hedonism at work
Multi-sensory experiences involve visual appeals, audio appeals, touch, taste
and the sense of smell. In almost every product category, there is scope to
improve the sensory aspects and marketers strive to enhance the sensory ap-
peals to make them an important proposition, even in categories where the
functional proposition (leading to benefits) is strong. Jewellery has been trad-
itionally associated with visual appeal (symbolic benefit of enhancing one's
self-image) but perfumed jewellery adds another sensory dimension to the
category. Pencil holders (separate pieces that can be inserted into any pen-
cil) enhances the grip and contributes to the feel of the user. i Pod's design
makes it one of the most successful products in consumer electronics. Dis-
posable plastic knives create a user experience, different from the traditional
one. Dove, the moisturizer soap can be associated with an experience different
from that of ordinary soaps. The emergence of improved personal care prod-
ucts has not only added to the benefits associated with them; they are also en-
hancing the consumption experience. Gillette's Sensor Excel and Mach3 have
been created with several millions of dollars to deliver the ultimate shaving
experience. Tide detergent's fragrance adds to the feel and smell of clothes.
Miata, the car from Mazda designed some of its parts to ensure a “feel good”
factor when the consumer uses it. Axe deodorant effectively uses the sensual
appeal of the brand. Colgate's variant with crystals is an example of taste as
a focus in toothpaste, going beyond the benefits normally associated with the
category. The feel factor can also be used by a brand of washing machine if it is
able to offer a good proposition in this factor. Toyota's Lexus became a global
brand by offering the sensual experience associated with Mercedes at a lesser
price. Dettol's burning sensation itself may be a preferred benefit by consum-
ers who may associate the sensation with its effectiveness. It is not unusual to
find consumers preferring “hot” creams to get rid of aches and pains. Several
brands convey this experience to consumers. Centre Fresh candy used the
taste aspect as its proposition.
Applying hedonism to products and services

There are three categories of products/services from the viewpoint of hedon-
ism: 1) Products that completely depend on sensual gratification; 2) Products
that have been traditionally associated with benefits; 3) Products that depend
on hedonism as a competitive differentiator.
Services and hedonism: Services have boomed in the recent times and un-
like products, hedonism has appeared rather radically and not in stages. Each
category needs to be analyzed from the viewpoint of consumer needs, seg-
ments and, more importantly, how brands would price these offerings. In a
marketing world that is increasingly moving towards lack of substantial dif-
ferentiation, it is important to use hedonism in a conceptual manner.
Products that completely depend on hedonism

Soft-drinks, biscuits, chocolates, fast foods and snacks completely depend on
hedonism associated with the taste-buds. “Country of origin” effects are quite
useful in such categories. There is already an existing image in the minds of the
consumers, and brands use them to further their proposition. French cham-
pagne and Swiss chocolates are examples. Bru Coffee's initial association with
South Indian filter coffee is an Indian example. Ethnic cuisine served in metro-
cities (Chettinad) explains the demand for these restaurants among consumers.
Brands that create a “first mover” association using such an approach stand to
make an initial impact on consumers. The delivery of hedonism should match
the expectation of consumers. When brands cannot make use of “origin” ef-
fects, a variation can be tried wherever applicable. In a highly competitive
market of chocolates, several offerings make use of “home-made” association
suggesting a different consumption experience. In certain foreign markets
some chocolates are priced over well-known brands. Another approach is to
create a unique offering that creates a totally different experience, which is
new to the category. Red Bull (energy proposition) and Gatorade (recharging
drink for sports persons) command premium prices. Ferro Rocher, the Italian
chocolate brand (available in some of the modern retail outlets) has its offer-
ings in the form of a ball (unusual for a chocolate) besides having a unique
blend of ingredients that melt softly in the mouth.
Products that have been traditionally dependent on benefits

Detergent powders is a category that has been completely dependent on
benefits for several decades. Ariel has “Spring wash” and Tide has “Jasmine”
fragrances that appeal to hedonism. Consumers, apart from requiring clean
well-washed clothes, may feel better with fragrant clothes.
Retailers of optical frames emphasize the “feel light” factor (especially with the
higher end ones) when traditionally durability and fit were important benefits.
In developed markets, a number of leading car manufacturers try to make the
interiors feel better and a few brands even spray a special fragrance when the
cars are sold. The feel factor has always been important in apparel, but with
major advances in technology, the feel factor has almost become the propos-
ition in a number of higher end offerings from well-known brands. In enter-
tainment electronics, as in products ranging from Sony's plasma TV and i Pod
to MP3 players, visual appeal plays as vital a role as product design, given the
symbolic value and perhaps the self gratification derived from such aesthetics.
Slim watches from Titan satisfy both the feel factor and visual appeal. Visual
appeal has always been a feature in consumer durable categories but in the
recent times, it has almost become a proposition, given the commoditization
of products with almost all brands offering the same set of features/benefits.
Onida's Ultra Slim, LG Art air-conditioners and Carrier's changeable grill air-
conditioners are some examples. The consumer may be more attracted to such
visual appeals, especially in durable categories that have a social signaling
value. Power House, the mini audio-system from Philips during the eighties is
a good example of how a brand used the visual appeal besides the price factor.
While higher-end product categories (like durables) rely quite significantly on
hedonism as a strong differentiator, hedonism is also getting into consumables
like detergents and soaps.
The marketing implication of hedonism with regard to products is interest-
ing. While both the lower and higher segments in a category may be interested
in hedonism, it may be worthwhile for marketers to find out 1) what is the level
at which hedonism appeals to consumers and 2) if consumers will be prepared
to pay for such hedonism. The first aspect is concerned with a concept called
“just noticeable difference” by which a brand will be able to know the point at
which consumers will notice a quality–in this case hedonism. For example, pro-
viding benefits like fragrance in detergents or even moisturizer soaps involves
adding such attributes and marketers need to find out at what point consumers
really notice and enjoy the experience. This can vary from segment to segment
and research studies are required to obtain insights. The second aspect is con-
cerned with how much consumers are going to pay for the hedonism. This is
important, given the proliferation of product variants and hence costs to the
brand. Such research also enables a brand to focus on a pricing policy.
Services and hedonism

The topic on hedonism will not be complete without the discussion on ser-
vices. Services, by their nature (intangibles, cannot be owned and sometimes
as in the case of medical field, the consumers may not even understand the at-
tributes but only realize the benefits), lend themselves amenable to hedonism.
Depending on the services offered, from the ambience and visual signals to
emphasize the quality of the offering (state-of-the-art machines) to the multi-
sensory experience of socializing in Coffee Day or Barista, a variety of hedonic
measures can be thought of as appropriate to the service and target market.
The socializing experience in a restaurant or a holiday resort, as a whole, can
be branded and marketed with a plan that has hedonism as the focus.
Until the time when consumers reach higher levels of spiritual accomplish-
ment (meaning control of senses as per a school of thought on the subject),
brands will have a hey day competing with one another, to draw the consumer
deeper into lifestyles of hedonism. And pleasure has infinite variants.
Variety—Marketer's Dilemma or Consumer's

Confusion
The following situation reflects the reality in the category of branded tea.
Brand A and Brand B from the same company offer the same proposi-
tion on the package but Brand A is priced Rs 3 more for a particular quantity.
This simple illustration raises a host of conceptual questions on product-line
management:
 Are the brands meant for the same geographical market? If so, why are
they found together on the shelves of a modern retail outlet (and perhaps
in kirana stores too)?
 Is the offering the same though the brands are different? If so, how would
the consumers differentiate between them? If not, why is there a lack of
differentiation?
 Are both the brands so powerful that each would have its own loyal tar-
get segment though the offering is the same and the proposition is also
the same?
 What would be the implications on the consumer's psyche if he/she rec-
ognizes the fact that the offering is the same from both these brands but
one is priced higher?
 How would the retailer handle a consumer who raises this query of the
same proposition at different prices?
 How should both the brands be promoted? Or, should only one be ac-
tively promoted?
 If one or both the brands have developed their unique brand association
over a period of time (assuming that consumers are familiar with both the
brands, or at least one of the brands), how should the brand manage its
past brand association and imagery?
 What would be the implications for the company's product line with regard
to the category when it offers several brands (other than the two brands
mentioned) in terms of consumer choice and product-line profitability?
These are some of the vital questions concerned with managing a product-
line. The greater the consumer's choice offered by a company in a given
product-line, more is the complexity associated with its management. The
concept of power brands, which is a current topic among the practitioners
of marketing has strong linkages with the management of product-lines of a
company. Product-line differentiation has important implications for manag-
ing brands in a specific category. The major issues include target segment se-
lection, brand associations, retail interface (stock-keeping units and demand
management), profitability associated, extending existing brands, introducing
new brands and re-launching brands. Managing consumer choice and differ-
entiating the offerings are the inherent challenges and all the associated issues
stem from these challenges.
Product category and the evolution of variety

In almost any category variety evolves over a period of time when the basic
product is well accepted by consumers (including niche offerings, which are
of premium quality). This, to a great extent, is true both in fast-moving con-
sumer goods and durable categories. After digital watches were introduced
almost three decades back, there is so much of variety toady. For a company
like Titan, which has an extensive product-line, the challenge is to not only
introduce various models in line with changing preferences of consumers—
it has to also manage its supply chain and distribution and ensure optimum
profitability at all times. Britannia's success was based on variety stock keep-
ing units and managing several variants in its product-line. In the category of
cars, too, initially, there was just the basic (currently mini) segment and over a
period of time compact, semi-luxury and luxury segments have emerged and
each of these segments have variants. Lifebuoy and Pears soap, after several
decades, decided to have variants to adapt to consumer preferences. Portable
music systems that had a few models of two-in-one (transistors cum tape re-
corders) two decades ago have fragmented into walkman, i-pods and discman
portables. Nokia that has a commanding share in the Indian market has a wide
variety of offerings from the lower end to a few models costing more than
a lakh of rupees. As reflected by some of these examples, a company has to
necessarily introduce new offerings to stay in business whenever technology
levels change in the market. A company has to monitor both technology and
trends in consumer preferences to introduce variety. Sometimes, technological
advancement can lead to the opening up of variety leading to market expan-
sion. The varieties of shampoo that can be sampled (including some higher
end variants) in sachets today, is an example of how market size gets expanded
when the offerings are brought within the affordability limits of a larger target
segment.
Importance of differentiation
When a company is interested in many segments and multiple offerings
for the consumer, a clear differentiation is required. There has to be a clear
focus on marketing mix elements associated with the various offerings in the
product-line. This is essential as a product-line addresses different wants of
different segments that have the same need. Colgate addresses the same need
of “brushing/cleaning” the teeth but the wants are expressed by different tar-
get segments differently and hence, a variety of offerings like Total, Herbal
and other variants. This is one of the reasons why brands are created in the
product-line. The following are certain fundamental decisions that need to be
taken when offerings in a product-line are addressed.
 Is the product benefit different and do consumers understand the brands'
proposition towards the respective segment? For example, Colgate Total
offers several benefits associated with oral care as compared to Colgate
Herbal that is clearly positioned towards a segment that believes in herbal
attributes and taste. Parachute's Sampoorna (herbal) coconut oil is differ-
ent from its Jasmine variant and the differentiation is obvious. There may
be a few categories like soft drinks and beer where the differentiation is
largely driven by imagery created through advertising, though the taste
experience may also be used as a strong differentiator. But besides these
categories, a brand should ensure strong functional or benefit differenti-
ation wherever possible as it provides clarity to consumers. For instance,
the whitening proposition of a detergent brand (Rin) is differentiated
from the stain-removing proposition of another brand of the company
(Surf). Lux soap has a contemporary image and functional differentiation
has been achieved with several variants (fragrances) of the brand.
 Can distribution make a difference with regard to the consumer's percep-
tion? Retail outlets like brands that have image associations, and differen-
tiation with regard to a product-line can be achieved through distribution
strategies. For example, if a brand that is into soaps launches an expen-
sive gel variant, selective distribution of the variant may add to the aura
of exclusiveness that the brand is attempting to create. World Space music
that provides continuous music service in different languages is not dis-
tributed in all retail outlets that deal with CDs. The same brand perhaps
can have a different mass market brand that can be sold in regular retail
outlets. Raymond, the brand of fabric, is available in many multi-brand
outlets, but the exclusive outlets of the brand all over the urban markets
with its complete range of higher end offerings provides and sustains
the image of the brand. Peter England and Louis Philippe brands from
Madura Coats have clear cut channel arrangements (including exclusive
shops for each of these brands) to signal differentiation.
 Issues on positioning clarity: Hero Honda entered the Indian context
about two decades back with its four stroke engines in bikes and still
has a commanding market share in the category. Its initial positioning
on fuel economy “Fill it. Shut it. Forget it.” conveyed the positioning of
the brand when it introduced its CD 100 model. The brand, since then
has used “functional feature sub-branding-focused positioning combin-
ation” effectively to convey the differentiation of its varied offerings in
the product-line. Sunfeast biscuits from ITC used a film celebrity to de-
velop the brand's imagery and for its Fitkit, it chose a cricket celebrity,
as the offering was launched on the health platform. Hindustan Lever
has clearly used positioning strategies to differentiate among its various
shampoo brands, namely the Clinic variants (there is also a differenti-
ation among the variants of this brand), Sunsilk, Lakme and Dove. Pos-
itioning clarity is required either through functional benefits or psycho-
logical benefits.
Complexities of consumer choice and variety will continue to haunt mar-

keters, and what they do to avoid dilemma and confusion depends on every
aspect of productline management.
Approaches to Consumer Buying Behaviour

Marketers need to understand the approaches that consumers apply to pur-
chases—from the glamour and variety-ridden fast-moving consumer goods to
the utility and symbolism-orientated durable categories.
Coke, the brand name with which millions are familiar and the one that has
been evaluated as the brand with the highest brand equity (in the inter-brand
Businessweek rankings) for several years is a low involvement brand! – a cat-
egory and a brand with which consumers do not process extensive informa-
tion or spend several weeks (like the purchase of a durable category/brand)
in their purchase efforts. Fast moving durable goods have a daily association
with consumers, poor or rich. They are promoted predominantly by glam-
our; a number of multinational corporations have been involved in marketing
them for years and they also account for a significant market-share among the
rural Indian market. Marketers need to understand the psyche of consumers
in order to sustain their interest in their respective brands. On the other hand,
consumers spend significant time in retail outlets to decide about their well
thought out durable categories. Both these situations of decision making call
for different approaches from the marketing viewpoint.
Consumer psyche and fast-moving consumer goods

Consumers associated with the decision making on fast-moving consumer
goods may choose to have limited information either because they are variety
seeking or because of enhanced offerings. Though consumers may be loyal in
these categories, it is highly probable that the consumers are loyal to more than
one brand. They may try out variety and buy one brand to which there is dom-
inant loyalty. There are also situations when the consumer buys impulsively
after being exposed to limited information search in those categories like ice-
creams, soft drinks, chocolates, perfumes and deodorants.
Low involvement product categories have what can be called as a variety
seeking “repertoire of loyalty.” One may perhaps (extending this to soaps too)
try different soaps and settle down to a loyalty that has a base of more than
one brand. This, in fact, is the changing contemporary aspect of loyalty that
is being researched today. If deodorants are considered, they are low involve-
ment products that may interest the consumer, to a limited extent. There may
be some information search through the mass media or at the point of pur-
chase.
A consumer who is using, or perhaps even the prospective first time user
may take a look at an advertisement or the brand itself at a point of purchase
(retail environment) and go through the information provided. Consumers re-
quire variety in these situations and may require variants of brands. Talcum
powders, deodorants, soaps, biscuits, chocolates, cereals, soups, toothpastes
and cooking flavours have brands that have variety. There is a need for brands
to launch variety and also keep the excitement high through advertising com-
munication. For example, in tune with the fitness and dieting trends, Kellogg's
has launched a “K variant” for the segment that is conscious of weight-related
issues.
In some categories like masala/spices, there is also an ethnic/cultural taste
slant and this is one of the reasons why organized brands like Mother's Re-
cipe and Everest do not have a commanding national share. Price, of-course,
is one aspect in which local labels (different from private in the bookish sense)
drive to be in the shelf. But, surprisingly, local brands have also been found
to be priced higher in similar categories. Noodles made by three manufactur-
ers have three prices and the difference is significant. The approach that is
necessary for branding, in such categories, is to develop a strong brand (not
just by advertising) by blending quality and taste according to regional pref-
erences, advertise it with a cultural overtone and introduce more of variety.
This means that a brand should have a different approach in each region
(some brands of tea adopt this strategy).
Touch of the digital media

The online advertising interface and mobile phones have created one more
dimension to the limited decision making process, wherever it is appropriate.
Brands have started using them when they are appropriate to the respective
segment. A deodorant like Axe brand targets urban youth with motivation
towards a glamorous lifestyle. It has a significant market share in India. The
commercials are fantasy-based that may also appeal to the limited decision
making psyche of the target segment. “Axe Effect,” “Axe Pulse,” “Axe Click”
and “Axe Vice” are commercials of the brand with different themes mixing
glamour and humor. Besides TV campaigns, the brand also uses SMS contests
and axeclick.com and axeeffect.com Web sites. Low involvement product cat-
egories are driven by excitement/variety/impulsive behaviour or a mixture
of several of these aspects. The functional benefit is generally backed up by

symbolic aspects of belongingness, group togetherness, status or other self-
concept appeals. Parry sugar that is attempting to build a brand in a negligible
branded sugar market used the metaphor of “innocence” to drive home its
proposition of purity. The advertisement showed an innocent young girl tell-
ing the telephone caller that her mother has asked her to tell her (the caller)
that she is not at home. While only research can reflect the sale of the brand
from such campaigns, it is evident that consumers become aware of the offer-
ings and its proposition with limited information search.
Brands/features/retail stores – consumer psyche and

durable categories
Retail store traffic (footwalls) are important for all categories, especially for
durables, in the Indian context as consumers believe in “touch-feel-buy” pro-
cess. It is not uncommon to find in semi-urban areas, families “embarking” on
a journey to the nearest town to buy durables. In the urban areas too, consum-
ers like to visit stores, compare brands, prices, features and then put together
the WOM they may have received earlier to make the final choice. The re-
tailer's say is quite powerful in semi-urban and rural markets. The discount
provided by the retailer also plays an important role in the decision to buy a
brand from the respective retailer. Consumers, in the process, ascertain not just
information about the brands: they also gather information about the retailer
in the case of extensive decision making while buying durables. Category kill-
ers (dealing with a wide variety of a specific category) like well known retail
outlets are attractive to many consumers as they not only show case many
brands but also provide huge discounts (Big Bazaar). As most of these retailers
deal with many categories, they are variants of typical category killers.
Retail service is a key factor in extensive decision making during the infor-
mation seeking phase of consumers. It is important for store personnel to un-
derstand the needs of the consumer and educate him/her on the fit between
the offering and the needs. There may be a tendency on the store personnel
in most shops to recommend an offering that provides the maximum profits
to the retailer. This is a short term approach and can create dissatisfaction
among consumers. With the range of products available in several categories
like TVs, micro-waves, mobiles, refrigerators and air-conditioners, the con-
sumers may not be able to pick the right offering: in fact the present variety/
number of brands may confuse him/her. This is a practical aspect that makes
specific decision-making rules, in theory, ineffective. This is also a situation
that creates an opportunity for the retailer to build the retail equity. Whirlpool,
in developed markets, has outlets where consumers can try the products be-
fore buying them. The sales personnel are trained to convey the highest prod-
uct knowledge and its applications to consumers. A retailer should build the
equity of the store; this helps when the market becomes competitive and the
retailer, through the trust earned, can launch private labels even in durable
categories.
Consumer decision making, and how marketers adapt their approaches to
this decision making process is a basic foundation for brand success.
Challenges of Customer Satisfaction, Loyalty

and Migration
Customer retention, and in the recent times managing customer migration,
has been a topical issue the world over. Understanding the psyche of consum-
ers and adapting to their needs form a significant part of customer retention
strategies – a radical shift from the strategies of yesteryear when customer sat-
isfaction was always linked to overt functionality-based outcomes.
Companies are today grappling with the realities of customer satisfaction,
loyalty and management of customer migration, trying out both strategic
initiatives and operational methods to ensure customer retention. Customer
Relationship Management (CRM) is one such measure. There are streams of
research that suggest that a vast majority of companies that have invested in
CRM have not got much ahead with regard to customer retention. Making the
challenges more complex is the fact that even satisfied customers may not buy
the same brand again and consumers may have a repertoire of brands to buy
from, even if they are loyal to a set of brands. The scenario can be observed
and analyzed in the airline and credit card industry where consumers seem to
exhibit brand loyalty towards more than one brand. The efforts of a company
to sustain consumers through programs like frequent flier get thrown out of
gear as consumers use such programs across brands in a given period of time.
Marketers need to get into the nuances of consumer behaviour, so that they
may be able to address problems associated with customer loyalty and migra-
tion in an effective manner.
Why do consumers defect? How brands can address

the associated problems?
Consumer defection may be associated with different reasons depending on
the category of the product. One primary reason is dissatisfaction with the
brand. There may be three reasons for a consumer to be dissatisfied with his/
her current brand. Functional aspects, symbolic aspects and experiential as-
pects are primary reasons that are responsible for consumer defection. Inter-
estingly these aspects are not mutually exclusive and that probably explains
why a consumer who has expressed a high degree of satisfaction on the func-
tional plane (as normally reflected in opinion surveys) may not buy the brand
again to reflect brand loyalty. It may be appropriate to discuss this thought on
defection with regard to various examples drawn from different categories.
Satisfaction varies across products/services and

target segments
Television, as a category, is experiencing the replacement cycle in the country
to a great extent – a significant share of the market is made of consumers who
are replacing their television sets. A consumer who has been satisfied with
his/her TV set may like to choose a different brand of TV with probably bet-
ter looks or features during the replacement cycle. With price-feature combin-
ation being dynamic in the industry with several brands competing with one
another, dissatisfaction is more at the latent level than at the overt level for a
consumer who buys a new brand (and not the brand he/she has been using)
during the replacement cycle.
Hence a brand of TV not only needs to provide effective after-sale service
and deliver a good product: it has to also ensure updated products and other
value added services to come to terms with the changing needs of consumers.
A TV brand introducing “on-call” movies, for instance, in an urban market
where a family is under time pressure is likely to offer value that is satisfy-
ing in terms of the list of movies offered, time convenience, the cost saved in
buying a DVD player, and efforts and rentals related to the renting of movie
albums.
The process is a dynamic one in which the brand has to address the con-
sumers' context and combine products and services in an appropriate manner
rather than only fine tuning after sales service to very high levels that reflect a
traditional approach towards satisfaction and consumer retention.
Changing consumer needs
Consumer satisfaction Brand offerings
Figure 1.1  Link between consumer needs and brand offerings.
Figure 1.1 shows how consumer satisfaction/retention is linked with how well
the brand is able to adapt itself to the changing needs of consumers.
The symbolic aspect of satisfaction has to be delivered on a different
plane.
Development of brand associations and brand personality is the challenge to
marketers on the symbolic plane of managing brands. Of course, brand offer-
ings too, should support such associations. Harley Davidson's motorcycles
reflect how such symbolism can create a cult brand through a group of in-
volved consumers who unite together to show case such a binding with the
group. This is an extreme example of symbolism-based loyalty, but it under-
lines the importance of building up symbolism to ensure loyalty. Owners of
the group strongly relate to one another, organize group gatherings and ex-
hibit a strong sense of belongingness. At a more moderate level, associations
of Louis Philippe and Park Avenue apparel, premium-ness associated with
higher-end cars and the signaling value of high-tech gadgets like iPod are
examples of how symbolism can drive loyalty. As stated earlier, it should be
noted that symbolism can be sustained if backed up by appropriate product
offering strategies. Onida's “Owner's pride, neighbor's envy” created a high
degree of symbolism during the eighties and any brand in this advantageous
situation should be in a position to sustain such symbolism with innovative
offerings and appropriate symbolism in communication. Power House from
Philips, the mid-range music system introduced several years back, also cre-
ated powerful symbolism.
Experiential aspects are relevant to hedonistic products and services.
Britannia's success in the recent years reflects its approach towards under-
standing the experiential aspects of how consumers enjoy biscuits and the
launch of appropriate offerings. It should be noted that in such fast-moving
product categories, variety is the key towards sustaining. There are two as-
pects to variety – the same consumer trying different offerings, and variety
being offered to different cross sections of consumers because they prefer the
experience associated with the variants. Lux (with its variants), Rasna's offer-
ings, Cadbury's offerings, Lay's offerings, Colgate's variants in toothpastes,
brands of tea offered by Tata, variants of Parachute hair oil and the offerings
from Sunsilk shampoo are some of the examples on how variety is important
to marketers. The challenge for marketers is to obtain insights on what is rele-
vant to consumers and how the product-line (reflecting variety) is to be bal-
anced from the viewpoint of profitability. Research has shown that too much
of variety can make a dent into profits apart from confusing consumers—that
is counter productive to brand loyalty.
Brand loyalty is not just repeat purchase: it is repeat purchase with com-
mitment associated with the brand. There are three prerequisites for this – the
first one is gaining consumer insights to balance the offerings as appropriate,
the second is the organization's internal ability to adapt itself to the changing
needs of consumers, while brand association is the final aspect. These pre-
requisites provide a link to the consumers to identify themselves with the
offerings. Without such a long term approach, the utility of “contemporary”
strategies would only result in cosmetic and short-term results.
Opinion Leaders as Thought Leaders

Whether it is Britney Spear's latest album “Blackout” or the connoisseur's
Corum watch, opinion leadership matters to brands.
In this era of thought leaders and thoughtless indulgences (meaning
pleasure-seeking indulgences without much decision making processes), opin-
ion leadership may well be one of the much sought-after marketing strategies.
While the concept of opinion leader is decades old, its resurgence in the digital
marketing scenario has created a growing interest among marketers. Besides,

marketers have also started using several variants of the original concept.
Why is opinion leadership topical?

The proliferation of brands, clutter of brand communication, emergence of
sub-cultures and a shift from mass media (especially for brands not addressing
the mass market) are some of the reasons why opinion leadership is becoming
a high priority strategy for brands. Buzz or word of mouth, consumer refer-
rals and viral marketing (word of mouth through digital media) are some of
the strategies strongly linked to opinion leadership. With consumer awareness
and consumer confusion on the rise (awareness due to exposure to informa-
tion and confusion due to exposure to brand claims and advertising clutter),
consumers require an information source that has credibility. Opinion leader-
ship provides the credibility that reinforces the confidence of consumers to-
wards brands. Opinion leadership involves the informal communication of a
consumer (leader) to another consumer (opinion seeker). This communication
which is of informal nature can be with regard to product and service cat-
egories, retail outlets and features and benefits associated with brands. Opin-
ion leaders, though traditionally considered as consumers providing market-
ing related information to fellow consumers, can in today's context, double up
as trend-setters in categories like fashion, music, entertainment and symbolic
categories like watches and mobile phones. This is because the underlying
consumer behaviour related to opinion leadership provides a perception to the
information received by the opinion seeker in a variety of product categories.
The following examples reflect the popularity and power of opinion lead-
ership in India in several product categories growing steadily in terms of mar-
ket growth in the recent times.
 Louis Philippe versus Arrow, Van Heusen and Park Avenue (branded
apparel).
 Samsung versus LG, Philips or Sony (TV).
 Cannon versus Sony, Kodak or Pentax (digital cameras).
 A Swatch watch as an impulsive buy (for a trendy urban consumer,
simply because it was suggested by a friend to be a fashion accessory in
the Indian market, where it is priced in the range of around US$100 as
against its cheapest version abroad in the price range of US$10–$20).
 Motorola's colourful mobile sets at around Rs. 4000 as a symbol of fun
and fashion.
Psyche of opinion leadership

There are several cues in an environment like advertisements and personal
sources of information. Consumers get used to advertisements and obtain word
of mouth opinion on brands and product categories from opinion leaders who
may be from their circle of friends or acquaintances. A consumer associates sig-
nificant degree of credibility to an opinion leader when the former thinks of the
latter as a consumer who has the knowledge and expertise/experience about
a specific category of product. This credibility works with the brand's commu-
nication on its features and benefits, and the consumer chooses the brand that
fits into his requirement with the combination of information provided by the
brand's advertisements and also with the aura of credibility obtained from the
opinion leader. In most cases, the consumer chooses the opinion leader from
among his circle of information providers (for the respective category). The
opinion leader for one category may be the opinion seeker in another category.
The credibility associated with the opinion leader conditions the opinion of the
consumer towards a specific brand. The higher the perceived risk associated
with the category, more will be the impact of the opinion leader with regard
to the purchase of the product or brand in that category. In certain categories
like fashion or entertainment services (music and movies), the opinion leader
may not only be an innovator (first to have tried out the product or service):
he/she may also be the trend setter. The mobile downloads of Sivaji's songs
or the popularity of Om Shanti Om or the demand for Dev Anand's Jewel Thief
hat almost four decades back may well be the influence of opinion leaders
on social involvement, who had spread the trend among his/her followers.
A fashion/entertainment product depends to a great extent on millions of such
opinion leaders as the fashion/fad cycle is likely to be of a short duration.
While opinion leadership involves word of mouth, the opinion that pro-
vides brand referral based on usage is appropriate for high involvement prod-
uct categories where there is a lot of search effort on the part of the opinion
seeker. There is recent published research in the academic field to reflect that
heavy buyers of a brand may not provide the maximum brand referrals and
marketers would do well to probe the word of mouth based on brand usage
among various segments of consumers who buy the brand. In a category like
retail banking or telecom services/mobile services where millions of consum-
ers may be associated with the brand, opinion leadership measurement may
provide valuable insights. Besides, when new product offerings are intro-
duced (for example the futuristic TV in a mobile), the “innovator” segment
(consumers who try the service or the product within a short period after it is
launched) may consist of opinion leaders who may want to spread the word of
mouth about the new innovation/offering. Such opinion leaders are important
from the viewpoint of the brand and marketers need to plan out a promotional
scheme to motivate such consumers.
With the proliferation of digital media, and given the fact that major users
of digital media are young consumers, a brand has the opportunity of using
the Web to create opinion leadership through word of mouth, especially when
it comes to entertainment and fashion brands. Red Bull, (a soft drink with the
energy proposition) that registers billions of dollars of sale every year, grew
into a major brand in several countries of the world. The brand used word of
mouth and unconventional promotion aimed at triggering word of mouth by
opinion leaders in the segment. Fun, adventure and quirkiness is the brand
personality and its Web site (www.redbull.com) reinforces this with the back-
drop of adventure sports, music juke box (music on demand) and other events
that reinforce enjoyment. The strong linkages of hedonism (consumption ex-
perience involving the ingredients that produce energy), the various events
that are a part of enjoyment in the lifestyle of the younger generation, the
country-specific customization of the Web site to accommodate a diversity of
cultural pleasures and the resultant word of mouth generated by groups of
youngsters, make the brand highly experiential and group oriented.
Thought leadership in marketing involves innovative thinking that is
meaningful to the brand; a conceptual approach towards creating thought
leaders among consumers, will add value to marketing strategies.
Conceptualizing Glamour—Celebrity Advertising

as a Branding Strategy
Celebrity advertising is an attention-getting technique that is extensively used
in India. This article delves on the consumer–brand–celebrity linkages.
The Indian marketing scenario is unique in several aspects and this in-
cludes the usage of celebrities in marketing brands. In the period 2003–07,
celebrity endorsements on the television channel went up six times. Celeb-
rity advertising has its roots in the concept of reference groups. Consumers
develop a lifestyle and attitude based on the influence of celebrities. While
celebrity advertising in the yesteryear attracted attention (Lux is a brand that
has been using celebrities drawn from films for a number of years), today's
challenge in celebrity association deals with a host of factors. A brand needs to
plan and execute celebrity association to achieve a specific and focused object-
ive that may differ from one brand to another. Celebrity usage by the maker of
a bulb may be to raise the awareness level of the brand, and the one used by
a watch may be to connect with a target segment that has a specific lifestyle.
Another brand of milk-additive drink may be using a celebrity to develop a
brand personality that adds to long-term brand associations. Taj tea, after mak-
ing use of a celebrity from the field of music, has shifted to a reigning celebrity
from films to make the brand contemporary.
Type of product category

Impulsive categories need a different approach as compared to categories that
convey a social appeal. For example, the cola category uses celebrities to have
associations of excitement, glamour and fun. A brand of car, too, may employ
celebrities to convey a kind of fun but the latter convey a specific lifestyle
that has an affordability level and an aspirational tag to appeal to the target
segment (Example: Santro, positioned as a “Sunshine” car with celebrities).
Flyte, Pleasure and Scooty Pep are two-wheelers that use celebrities who
may appeal to young urban women. Cadbury that started positioning itself
to adults almost a decade back uses a popular celebrity to appeal to this seg-
ment through humorous situations. The well-known Parker pen brand used
a popular celebrity to appeal to the target segment. Amitabh is a celebrity
used across product categories to appeal to diverse sets of consumers. It is the
charisma that transfers the favourable celebrity association to the respective
brand. There is a fundamental difference between using celebrities in low in-
volvement categories and high involvement categories. A low involvement
category is one in which the search effort on the part of the consumer is low,
consequences of buying the product category/brand is low and the perceived
risk also is low. Consumers are willing to experiment with the brand and try
out variety. Soaps, soft drinks, confectionery and biscuits are few categories
that fall into such a categorization. In this context, the attitude towards the
advertisement is important to convey the “feel good” factor. This does not
mean that the product attributes are not important. Sunfeast brand offers a
distinctive taste differentiation besides, providing the feel good factor with
the celebrity endorsement. The brand enters the psyche of consumers through
this “feel good” factor.
In the case of high involvement products like television, air-conditioners,
cars, two wheelers and real estate (one real estate company had used Dravid),
the involvement levels are high. Consumers sift through various kinds of in-
formation, compare attributes and benefits, give tremendous importance to
“word of mouth” communication and most consumers shop extensively to
find the right brand. In the present day context of glamour-based lifestyles,
there may be a small segment (indulgent one in this context), that may buy
a durable brand simply because it is endorsed by a celebrity. The objective
of such a consumer is to create a “social buzz”, to be the cynosure in his/her
own social circle. Mobile phones that signify trendy lifestyle statements belong
to this category. It is also interesting to note that such segments, though may
be influenced by celebrities, also get attracted by the state-of-the-art features
found in those brands. Such consumers may not use all the features but along
with celebrity association, these features add on to the novelty of the buzz
factor (meaning triggering word of mouth from the user of such a brand). In
this case, the attitude towards the brand (more because of novelty value) and
the attitude towards the advertisement due to the association of celebrities
are both important. The brands catering to such a segment should bring in a
novelty appeal and excitement as frequently as possible and these brands may
become associated with fashion brands (like i-phones). Raaga, from Titan, may
be associated with such propositions. Similarly BPL dealing with consumer
durable categories had used a popular celebrity. A majority of consumers buy-
ing durable categories go through several aspects of high involvement pur-
chasing behaviour and for this segment the attitude towards the brand with
functional utility aspects are extremely important. Such an attitude is the cen-
tral aspect of purchasing behaviour. But an aura of credibility may be brought
in by choosing the right kind of celebrity who may appeal to the target seg-
ment. The charismatic meaning associated with the celebrity is important.
Brand differentiation
Titan has an interesting strategy of using different celebrities to differentiate
across its watch product-line offerings. It has a trendy and very urban celeb-
rity for Fastrack, a cricket celebrity for Sonata, a female celebrity for Raaga
and a popular celebrity for its Titan range. This strategy conveys the positive
associations associated with the celebrity to the respective brand. The watch
is a personal accessory and is generally associated with social appeal. Each
of the celebrities chosen carry a set of distinctive associations and differenti-
ation takes effect at the celebrity level, and this is backed up by appropriate
designs, collections and price points. Gillette uses a set of celebrities drawn
from cricket, soccer, tennis and snooker (from different nationalities) and the
brand has an international presence. Celebrities drawn from cricket have en-
dorsed Boost, associating the brand with success in sports through energy.
Differentiation through celebrities needs to be done at the benefit level or at
the level of lifestyle associations and sometimes through both. The imagery
associated with such advertisements need to convey the meanings clearly.
Santro's TV advertisement (the original and the one for i10) carries both kinds
of associations.
Usage of glamour through celebrities is an active strategy in the Indian
context. It may be interesting to study if so many variations of celebrity adver-
tising (both across categories and in terms of the type of celebrities) have been
used in any other developed market. Conceptual clarity will add more value
to the glamour of celebrities.
Exploring the Consumer Lifecycle

Marketers have realized the importance of psychographics in consumer be-
haviour in analyzing the mindset and lifestyles of consumers. Age as a seg-
mentation criteria, is not any thing new to marketers but the implications of
this criteria to the present-day context needs to be revisited.
India may have a low per capita income and low penetration levels with
regard to several categories of products and services but scores over several
developed markets in terms of its demographics connected to the youth popu-
lation with about 40 percent being below 21 years. The age longevity too has
improved in the recent times with the 65-plus population on the increase. There
is also the segment of children, especially in the urban markets, for products
ranging from apparel to watches. While the actual percentage of the Indian
consumers with discretionary income in these segments may be low, they form
sizable numbers in terms of market. These segments require not just a different
approach towards marketing communications – they also require new product
offerings that need to be developed. There is also the challenge of developing
a line of products/services that will ensure customer loyalty in this era of cus-
tomer migration.
Adaptability and brands

There were several brands in the past that were extremely successful before
liberalization but have declined after lifestyle changes gripped the Indian
consumers. There are a number of reasons for the disappearance/decline of
these brands but one of the important lessons imparted by these brands for the
successful brands of today is the need for “ongoing” products and services to
adapt themselves to the changes in segments and also produce new offerings
for the emerging segments. A marketer of plain conventional shaving cream
during the seventies should have moved quickly into brushless creams and
gels for the emerging segments. Marico is a good example of a brand that is
catering to the emerging lifestyles without losing track of its conventional seg-
ments. The brand kick-started the hair cream category (that has been in the
Indian mindset for several decades but not developed systematically) for the
urban youth but also caters to the traditional markets that uses hair oil. It has
several offerings that blend the goodness of coconut oil with changing life-
style needs. After getting attention on its hair cream offering “After Shower”, it
has introduced herbal variants of the brand, making the sub-category contem-
porary with offerings that deliver benefits that are anchored in tradition. The
brand is able to straddle the youth segment and also the conventional older
segment with appropriate offerings. Raymond's – an exclusive brand for men
all along – has launched children's apparel. Several categories like food, foot-
wear, furniture, snacks, cosmetics and apparel to name a few, offer extensive
scope for introducing offerings for the elderly. For example, a consumer would
have grown up with Cadbury's through his youth and may long for a chocolate
in his present condition as a 55-plus diabetic. The option is a foreign offering
that may be expensive. A brand that has a strong goodwill developed among
consumers through a period of time should be able to use the goodwill through
the age-cycle of its consumer base. Cadbury's recently introduced a variant for
diabetics. Product development efforts, coupled with appropriate marketing
communication that reinforces a brand's values, will be a useful strategy for
brands that use the concept of age-cycle. There is also a need to research the
trends and the gaps that may emerge as a consumer base ages. For example,
the 50-plus women of today may have used a well known brand of cosmetic
during their youth but may require an affordable offering to take care of their
cosmetic needs that are significantly different in their current situation. Cur-
rently, there are a few brands that address the higher end of the cosmetic mar-
ket. There is a huge potential for the middle-end cosmetic market, if tracking
studies are done about the usage patterns of cosmetics about two decades back.
Seamless transition and brands

The most important implication of the age-cycle concept of segmentation is
the possibility of a seamless transfer of a consumer base when they transit
from one role to another over a period of time. The “transition point” captured
with specific needs and highlighted with clarity will ensure that consumers
will perceive a brand as genuinely caring and have a lasting relationship with
it. If the mobile market is considered, a slew of services and offerings is being
advertised for several segments and an average consumer fails to understand
how certain services are relevant to his/her needs. Besides being drawn by
symbolic/emotional appeals, the consumer is likely to develop an inappropri-
ate “value for money” perception, with the feeling that greater the features/
range of services, more will be the value.
Teens in colleges have a need to communicate with friends and there may
be a generic need for fun and entertainment, but transition from college to
jobs/higher studies brings in different perspectives with regard to mobile
phone usage. While the fun element continues to some extent, the focus shifts
on how the services from the mobile will be useful for different kinds of profes-
sions. This is the point at which the brand has to research and innovate to offer
appropriate services that are relevant to the individual, than offering a string
of standardized entertainment or other services. When the same consumer
has children below five years he/she requires a different kind of service. With
teenage children, the consumer searching for different kinds of information
needs a different kind of service content. Nuclear families with both the hus-
band and wife working require distinctive service content. The relationship
between brand appeal and the transit of customers across the age-cycle can be
represented as in Figure 1.2.
The interest in product categories too, will be different from the view point
of advertisements and promotions that are heard through the mobile service.
A contest involving a SUV is unlikely to appeal to a mobile user who has
retired. The concept of permission marketing (that uses the receptivity of a
consumer to receive information about a service or product), can be applied
effectively along with the age-cycle concept while advertising through the
digital media.
Needs in a given age-slot Transition situation with age Major

aspects of transition How the product/service can be useful to
the consumer Construction of symbloic brand appeal.
Figure 1.2  Age-cycle and consumers.
Brand symbolism still holds good

One of the challenges for a brand is to stay relevant to the original segment
of buyers as they age. Should the brand appeal to the loyal age-old consum-
ers? If so, would the brand imagery hold good for the emerging segment of
youth, with even new offerings? What about categories that have the cohort
effect?
Cohort effect is the effect of growing up at a particular point in time.

Music and films are examples that illustrate the cohort effect relevant to aging
consumers. Beetles of the sixties make headlines in London with a new launch
and closer home, millions of Rafi's and Kishore's cassettes/discs find their des-
tination in the nostalgia experienced by consumers who grew up in such a
culture.
Brand associations, brand symbolism and usage of new brands are some
of the challenges that marketers may face in attempting to put the age-cycle
concept into use.
In a marketing environment that creates several complexities for the brand
managers, age-cycle concept will offer a firm direction for brands that believe
in concepts other than a mere fanciful advertising blitzkrieg.
2
The Importance of Consumer

Behaviour Towards Brand Success
Behavioural Dimensions of Marketing

Marketing has been developed as a discipline only in the past few decades
in India. In today's world of competitive offerings, diversity of consumer
preferences and proliferation of brands, consumer behaviour has become ex-
tremely important for marketing decisions, be it marketing mix elements, seg-
mentation changes or exploring new dimensions in consumer behaviour in a
changing environment. Several interesting trends can be expected in the new
millennium. Leisure and luxury markets have boomed in recent times. Sham-
poos and creams, which only the elite could afford a decade back are today
marketed in sachets across the country. Westernization has impacted the selec-
tion of product categories and brands. Jeans and the brands that exist in this
category are an example of this impact. Even in such a category, an innovative
marketer has come up with an ethnic brand (Ruf and Tuf) by applying the
principles of consumer behaviour. Psychographic and lifestyle changes have
given rise to new eating habits (fast foods, eat-outs and food socials). A section
of consumers may eat while driving. This trend, called grazing, has fast caught
up in the developed world. In turn, this may give rise to products like refriger-
ated glove compartments and cup holders in cars and, perhaps, yoghurts in
tubes. Consumer behaviour provides the “behavioural fit” to marketing mix
elements that need to be changed from time to time by marketers.
Consumer behaviour deals with the psychological process of decision mak-
ing by consumers in a social context, which also exerts group pressures on
them. A consumer buying a brand of two-wheeler, for example, is motivated
by the need to own the category and the particular brand (based on functional
and emotional benefits), and buy the brand from an outlet. This buying behav-
iour involves several psychological factors. These factors govern the individ-
ual thinking process (like motivation, personality, perception and attitude),
Consumer
behaviour
Marketing mix
Psychological Consumer elements for the
factors decision making target segment (in a
given environment)
Group factors
Figure 2.1  A Snapshot of Consumer Behaviour
steps involved in buying (decision making process), interaction of the con-

sumer with several groups like friends, family and colleagues (group-oriented
concepts) and selection of the brand and outlet depending on the price, fea-
tures and emotional appeal (marketing mix elements in a given environment).
Consumer behaviour links these four aspects to enable a marketer to formu-
late marketing strategies. The basic elements of consumer behaviour – what
the consumer buys, how he/she buys, when and where he/she buys and how
much he/she buys – is understood by the interaction of different factors asso-
ciated with consumer behaviour as shown in Figure 2.1.
Psychological Factors
These factors deal with the psychological processes that are built into the in-
dividual consumer's system. The important aspect to be noted with regard to
these psychological factors is that these factors are interlinked, resulting in
behaviour. For example, though perceptions and attitudes are conceptually
different in terms of their applications in a marketing context, attitudes also
contain a perceptual component. The body of consumer behaviour views them
distinctively to focus on specific applications. This is done to provide concep-
tual clarity to students of consumer behaviour. For example, in a product cat-
egory like soap or tea, perception may be important, as positioning a brand
indicates the differentiated advantage/proposition associated with the brand.
In a product like the dish-washer, attitudinal models may be important, as the
objective of a marketer will create an attitude towards the product, where, inci-
dentally, perception may also be equally important if too many brands enter the
market to create a demand for the product. Personality concepts are important
among psychological factors because they pack a brand with emotional appeal
to the appropriate target segment of consumers. In most categories, consumers
don't just look for functional benefits. They also seek symbolic gains. Symbolic
2  The Importance of Consumer Behaviour Towards Brand Success 67
benefits are those, which consumers perceive as beyond the functional qualities
of a brand. These may be emotional in nature (Tihar—where making a gift to
someone you love is the emotion), may revolve around self-concepts (Louis
Philippe), be associated with group appeals (Pepsi), or with human traits
(adventurous and rugged Marlboro) or even with status (Mont Blanc pens).
The personality of the brand (which is formulated with the personality or
reference group principles) may be reflected through brand imagery. Brand
imagery is strongly associated with perception. As stated earlier, this also
illustrates the fact that psychological factors are interlinked.
Learning is a concept that deals with the strength of associations and the
impact of a stimulus on consumer response in a given situation. A stimulus is
any information input to any of the sensory organs (an advertisement visual
is an input to the eye, and the accompanying jingle an input to the ear). The
strength of associations is used extensively in crafting the advertisement to
create the desired feeling for the brand being advertised. Concepts of learning
are also useful in exploring brand loyalty—an area of interest to marketers,
given the cost of acquiring new consumers.
Consumer Decision Making

Consumer decision making is about the sequence of steps involved in the de-
cision making process and distinguishes the products in terms of the level of
involvement – low or high – needed to make a purchase decision. Consumer
decision making is helpful for the marketer to focus on a specific stage of the
process. Even an established brand of mixer, Sumeet, will have to maintain a
“top-of-the-mind” recall through constant advertising (to maintain visibility
of the brand) and continue with its demonstration (which it has for a number
of years) at a retail outlet. Demonstration at retail outlets is important because
when a consumer enters the stage of “evaluation of alternatives”, he/she is
faced with a barrage of options, local brands included.
The post-purchase phase of the decision making process is essential for
marketers to ensure that consumers are satisfied after the purchase. Another
complex, but interesting aspect of this phase is how consumers reconcile to (or
are satisfied with) the brand they have purchased when they are faced with
similar or equally attractive propositions of competing brands. LG refrigerator
offers to preserve the nutrients of the foods stored in it, and BPL's Converter
offers the option of converting the freezer into storage space in the refrigerator.
Competing brands tend to impact consumer psyche a lot more in the post-
purchase phase.
Group Concepts
The concept of reference groups plays an important role in marketing com-
munications. Celebrity advertising has been used widely in recent times.
Testimonial advertisements and endorsements is another area of interest
to marketers. Colgate, Coke, Pepsi, Lux, Boost, Samsung and Grasim are
some of the brands that have used celebrity advertising. Word of mouth is
another powerful group concept. There are a number of conceptual aspects
that marketers need to consider before finalising on celebrity advertisements.
The clutter of advertisements in a category, the characteristics of the celeb-
rity, the target segment and the objectives of using a celebrity are some of
the important considerations while applying group concepts of celebrity
advertisements.
Importance of MAO
Consumer behaviour involves the study of individual thinking processes
like perception, attitude, learning aspects and personality. It also involves
group concepts like group behaviour, reference groups and socialisation
within a cultural context. While several aspects of consumer behaviour and
its linkages provide a framework for its study, the motivation, ability and
opportunity (MAO) concerned with the consumer provide a fundamental
and important foundation for strategies formulated by studying consumer
behaviour.
Motivation is the drive that activates a consumer to accomplishing
a goal.
A consumer who wants entertainment may listen to a CD, go for movies,
or watch TV. It is important to note that the motivation will depend on per-
sonal relevance, self-concept or his/her involvement with a specific situation/
product category. A consumer buying a soft drink may be motivated by a need
to quench his/her thirst. But just wanting a drink may express low involve-
ment in this situation vis-à-vis the same consumer buying a TV. Involvement
levels are likely to be more significant when a consumer selects apparel in tune
with his/her status. It should be noted that engaging in goal-related behav-
iour is different from achieving the goal itself. Motivation creates goal-related
behaviours but there are other dimensions that help accomplish the goal.
A consumer may want to be fit and have the motivation and ability (intel-
ligence, knowledge and money) to select and become a member of a fitness
club. But the accomplishment of the goal will also depend on the opportunity
he/she has. This may simply depend on the availability of time to execute or
stick to the fitness club schedule.
MAO presents a number of important dimensions that cannot be ignored
by the marketer. For example, even for a brand of soap (which figures in a
low-involvement situation), opportunity with regard to factors like distrac-
tion and repetition of the advertising message may have to be considered
when the promotional strategy is formulated. A premium brand of soap,
which targets an upper-crust consumer, may prefer to advertise on FM if it
finds out that this segment tunes into this channel while driving to work
or back home. This strategy will provide an opportunity to the marketer to
avoid the distraction caused to the consumer by other advertisements on
TV (which may be many in number) and also cash in on the brand's unique
strategy of advertising on FM. This will provide an opportunity to “reach”

the consumer a number of times more (repetition also influences information
processing) to carry the brand message. Besides, the consumer may also be
“time-compressed” (pressurised for time) because of his/her busy schedule
and may spend very little time watching TV. A direct marketing company
may offer 24-hour ordering if it targets nuclear families in urban areas where
both husband and wife go out to work. MAO provides several interesting
combinations that marketers can explore before they formulate marketing
mix strategies.
Consumer Behaviour and Brand Success

There may be a need to analyse consumer behaviour strategies in combination
with the marketing mix elements of specific brands to obtain insights into the
success or failure of a brand. This kind of analysis may involve more than
one concept of consumer behaviour and cover a combination of concepts.
These concepts, which explain a brand's success, may vary from one prod-
uct category to another, given the nature and intensity of competition in each
product category. Marketers will benefit if they understand the linkages across
concepts in a given product/market situation. This kind of analysis will result
in the following advantages:
(a) A marketer can formulate brand strategy after considering a number of

concepts associated with the competitive situation.
(b) A pioneering brand will have followed a specific strategy for success,
and it will have to combine a few strategies to sustain the success
achieved.
(c) A follower brand will be interested in identifying the “gaps” in the strat-
egies made by the pioneering brand and a combination of concepts are
likely to be helpful.
(d) In a number of consumer product categories (both FMCG and durables),
advertising or marketing communication (positioning strategies in par-
ticular) is given much importance in the formulation of a brand's strat-
egy. While this may be critical, marketers will also have to be aware of
the fact that other elements of the marketing mix are equally important.
In a competitive environment, positioning will have to be strongly sup-
ported by the other elements of the marketing mix.
(e) A combination of concepts in analysing a brand's success or failure can
also help the in viewing brand differentiation in terms of the total offer-
ings of the company in the respective product category. For example, in
the category of beverages, tea is an important product-line for Hindustan
Lever Limited. While Red Label may use the functional attribute of vita-
mins to enhance the brand perception among consumers, Lipton's iced
lemon tea may have to use certain strategies to create an attitude among
the target segment. A-1 may be another brand targeted towards the lower
end of the tea market, positioned on the aspiration of the masses. While
brand personality may be important for all the brands in the product-
line, Red Label already has a personality cultivated over a period of
time and repositioning the brand is the critical strategy. Lipton's iced
lemon tea has to focus on creating an attitude and A-1 has to sustain the
brand personality already created by an advertising campaign. The three
brands in the product-line require a focus on different concepts while for-
mulating strategies, and these strategies will be primarily instrumental in
creating brand differentiation with regard to the product-line.
Here we attempt to link a brand's strategies with an appropriate combination
of consumer behaviour concepts with a view to provide conceptual linkages
that may be of interest to marketing managers:
The Indian context has a number of product categories that are dominated
by (or where there is a significant share of) the unorganized sector. Biscuit is
a category which has a high share of the unorganized market. A major part of
consumption occurs at the lower end of the market (in terms of price points).
The unorganized market consists of several local brands (catering to local-
ised markets in terms of geographical regions) and a number of unbranded
offerings from bakeries. Here was a distinct and definite need for a brand that
could offer value at an appropriate price point (competing in the unorganized
market). There was a need for a brand to convey the value proposition through
an effective advertising campaign reassuring the consumers about the quality
of the product. Britannia introduced Tiger for the lower-end market by making
use of its huge network of retailing. They created a campaign that conveyed
the value perception among the target consumers. The value was not just in
terms of the price point, it was also in terms of how crisp and nutritive the of-
fering was. Britannia's association also enhanced brand perception among the
target segment. There was a past stimulus (Britannia brand), then a stimulus
from the present (Tiger brand to signify the new offering) and also an effective
communication strategy, which reinforced the positioning of the brand––high
value (as compared to rival offerings in the unorganized market) at a relatively
lower price point. The figure was the Tiger brand and the ground, the various
positive associations around Britannia. The retail network (in the semi-urban
and rural areas, apart from the urban areas) conveyed the affordability aspects
by associating itself with the brand (as against some offerings of the company,
which are urban-centric). The overall brand perception was created through a
combination of elements associated with the market mix (See Table 2.1)
Table 2.1  Value proposition of Tiger brand of biscuits.
Brand: Tiger
Product/Category: Biscuits
Concepts involved: Perception, culture, diffusion of innovation
Consumption of biscuits (probably even as a breakfast item) is a familiar

practice in India. It is a part of the eating culture of the country. Britannia, by
providing an offering that was affordable for the masses provided values and
reinforced the cultural practice. The value would have created a favourable
perception among the target segment, which would have compared the offer-
ing with the ones from the unorganized sector. This was made possible in a
category in which the diffusion was high, but there was a “gap” (in terms of
value) at the lower end of the market. The characteristic of diffusion, namely,
relative advantage in terms of value, was instrumental in making Tiger a suc-
cess.
Marketing Mix and Consumer Behaviour—Critical

Linkages
The computer company––Dell––is known for its online ordering proposition.
HP is not known for it though it is an equally well-known brand. Frooti may
have a higher recall than a number of other tetra-pack drink brands. 29” TV
segment in India may be only five percent of the total market but may be ex-
periencing a significant growth. LG, a brand of durables (refrigerators, micro-
waves, TVs), is known for its innovative features. Successful brands establish
critical linkages across marketing mix elements. This is critical in a competi-
tive environment, especially when product differentiation may not provide
a long-term advantage. A brand known for its innovative features will soon
have competition from “follower” brands and, hence, may have to create as-
sociations that revolve around its strength. This will place the brand “on top”
of consumers' minds and create a preference even when the others follow the
leader with regard to the core offering.
Importance of Marketing Mix

Marketing mix elements form the foundation of any marketing strategy. The
mix establishes the strategy of the brand in a systematic and structured man-
ner. It helps the marketer to establish linkages with the focused target seg-
ment. Decades back, companies may have attempted third-degree marketing,
which is “placing” the brand in the market and, later, fine-tuning the market-
ing mix elements (if demanded by the situation) to suit the needs of the tar-
get segment. Pre-liberalisation, in India, there was practically no competition
and few brands dominated the market (in several product categories). This,
in fact, encouraged marketers to practice third-degree marketing (even with-
out the need to either clearly define the market or to fine-tune marketing mix
elements). Today, even brands that have been in the market for several de-
cades make a planned attempt to construct a strategy by carefully identifying
the scope for providing a competitive marketing mix. Amrutanjan has used a
number of marketing mix elements to become competitive in the recent times,
with several product variants for different market segments. Iodex is another
brand that has contemporarised its marketing mix elements. Though Maruti
has been in the Indian market only since early eighties, it has been forced to
strategise variously so that it stays at the top. So, it has launched new models
and sub-brands, and provided several services, which, today, include trading
used cars and expanding its distribution. Marketing mix elements are import-
ant not only in their combination but also in the timing of such combinations.
Kores was a well-known brand in the category of copiers; Rajdoot had consid-
erable amount of brand equity even during the eighties; HMT was the time-
keeper to the nation before digital watches entered the country. Zodiac was
probably the earliest readymade shirt brand for men. In a number of these
cases, the timing of the marketing mix elements would have played a greater
role in sustaining the brand equity, which was created because they were the
pioneers in their respective areas. Interestingly, timing, in this case should not
mean being ahead of consumers' needs. Gestetner introduced digital copiers
in a market where digital copiers form an insignificant share. While Eveready
may offer alkaline (longer life) batteries, the marketing mix has to carefully
take into consideration that over 90 percent of the Indian market still buys
conventional batteries. A number of tyre companies may offer radial prod-
ucts, but the market is yet to convert itself in a significant way. Merlin came
out with home-theatre systems in the mid-eighties when consumers were just
getting used to two-in-ones (mass market) and televisions. Even today home-
theatres have a limited market. While a brand could develop a product offer-
ing to cater to a small niche market (Dove moisturiser bar or even the plasma
television sets that cost a couple of lakhs), it has to have a conscious marketing
mix plan that takes into consideration the realities of the market.
Need to Prioritise Marketing Mix Elements In a competitive

situation, a firm has to prioritise marketing mix elements. This does not mean
concentrating only on a few elements and ignoring the others. Prioritising
emphasises the need to recognise that some elements may be important than
the others at a given point of time. When Samsung entered the Indian market,
it offered the state-of-the-art product-line. But the priority was to develop a
brand with such associations (promotion) and also to develop a distribution
channel. Whirlpool, the fastest growing refrigerator brand in India, prioritised
product offerings adapted to local consumers (through marketing research).
This enabled the brand to come out with offerings which were in tune with
the needs of consumers. Heinz, the globally-known ketchup brand, entered
India where Kissan and Maggi are well-established brands. Though Heinz
may have had a superior product in terms of its attributes, there was a need to
create brand awareness and link the attributes to the name of the brand.
Advertising through a well-planned positioning strategy is required to
bring a product within the “consideration set” of consumers. It should be
noted that the penetration of the category (ketchup) is low at 2–3 percent. The
Heinz advertising campaign said the brand is synonymous with ketchup (in a
market where consumers were unfamiliar with the brand). Besides, the brand
followed an up-market skimming strategy of pricing the offering higher than

competition. While advertising may have been prioritised by the brand as a
pre-requisite for its “start-up” strategy, the brand had probably assumed that
consumers in India were familiar with the brand and would associate it with
the category. (This could be true with regard to other markets in the world.)
Further, pegging the product at a higher price (in a country where the need is
to sell the concept and create a market) need not have been a priority. A lower-
priced variant introduced with an innovative recipe, drawn from traditional
cooking styles, could have made a better impact on consumers. The brand
later introduced a sales promotion drive, which was followed even by the
strongly-entrenched brands in the category. The priority of the brand should
have been to position its low-priced variant with a view to trying the brand
and expanding the market. Kellogg's, another global brand in the category
of foods, created trials for its cornflakes initially when it entered the Indian
market but was unable to sustain repeat purchase because of its high prices
(almost 100 percent over the existing competitive brands).
Prioritisation of marketing mix elements starts from the clarity associated
with the definition of the target segment. If a brand of cereal is to be a niche
brand (which is a small cross-section of consumers in India), it should have a
marketing mix priority that is very different from the one required to market
the brand to middle-class consumers (to make them substitute their regular
breakfast with cereals. This is far from easy, as eating is a part of the culture
of any country. A niche brand could prioritise premium pricing and a high
visibility advertising campaign emphasising its global associations. A mass
market brand (however global it is) has to prioritise low-unit price in a country
like India. Perhaps, there can be some logic for a global brand to even be the
loss leader (with a low price) in India until such time as when strong loyalty is
established. Such an approach will enable the brand to increase the share of the
consumer besides expanding the market. This can be a workable strategy, es-
pecially for a brand entering the food category as experience all over the world
shows that such brands take decades to become a part of “consumer habit”.
Marketing Mix Priorities and Synchronisation Titan, which holds

a significant share of the organized quartz watch market, has been able to
plan the marketing mix priority and also synchronise the linkages between
different marketing mix elements. The brand may currently be working
towards stabilising profitability but the company is approaching the market
mix elements in a methodical way. The unorganized sector in the quartz
watch market is larger than the organized sector and the brand's progress has
been due to the carefully orchestrated marketing mix. As discussed earlier,
prioritisation of marketing mix elements (a combination of them) should lead
to synchronisation as demanded by the situation. The basic decision of Titan
during the mid-eighties was to be only in the quartz watch market (which is
a product decision). The initial campaigns of the brand created awareness by
stating Titan to be as good as any foreign watch. Then, it made an emotional
appeal by coming up with the popular Titan jingle. Simultaneously, the brand
transformed the experience of buying a watch into a pleasurable one by

offering the right ambience and comfort. This it did, by placing its products in
exclusive Titan outlets. Several variants were created at different price points
for various segments and, perhaps, the initial problems in differentiation
between various models was overcome by the effective application of sub-
brands (Bandhan, Nebula, Dash, Fastrack etc). The brand also developed
an effective retail network with its presence in multi-brand outlets. All the
efforts on count of marketing mix have put Titan well within the “top-of-the-
mind” recall of most Indian consumers contemplating purchasing a watch.
The approach of Titan could be compared with that of Citizen in the Indian
market. Citizen had an excellent brand equity known for its quality. It may,
in fact, still have this association. The brand could have effectively made use
of marketing mix elements in the Indian context, given the fact that a major
chunk of watches purchased in the country is priced below a thousand rupees.
Sony in televisions, Reebok in footwear, Ray Ban in sun glasses and Mer-
cedes in cars are some brands that entered India with a tremendous degree of
equity and a well-planned marketing mix could adapt effectively to the local
context.
Unorganized Markets and Marketing Mix Elements (FMCG ) India

is, probably, one of the very few markets in which brands need to compete with
the unorganized sector (biscuits, pens, detergents, footwear, dish-washing
powders, traditional snacks, tea, edible oil and commodities, to name a few
product categories). The most important aspect of marketing mix in most of
these categories is the quality of the product and the price at which it is offered
to low-end consumers. An equally important element is promotion—a high-
visibility campaign that creates awareness about the brand. A-1 tea, Vendee
edible oil (loose, branded oil offered through vending machines), Vim, Lakhani
in footwear, Tiger in biscuits, Haldiram's and MTR in snacks and Nirma in
detergents are some examples that have demonstrated the usefulness of the
approach.
Tiger, from Britannia, is a very good example of a brand providing value
to the low-end market (a major chunk of the market is present here in terms of
value). Biscuits form a part of the food culture. Here was Tiger whose biscuits
not only effectively competed with the other offerings from the unorganized
sector but also did so at an affordable price. The brand also created awareness
through memorable campaigns.
Marketing mix is equally important in international marketing. It even
influences the manner in which a brand's associations are formed in the con-
sumer psyche. Mont Blanc's products (known more for its classy pens) are
premium products the world over. But Citibank is associated differently in
different international markets (a mass-market bank in the US and a premium
bank offering banking services in Asian markets). Marketing mix elements
are largely responsible for these kinds of associations. These elements have to
be dynamic in a digital environment as well as within the capabilities of an
organisation.
Touch of Reality
The Digital Connection with Consumer Behaviour
While traditional concepts of consumer behaviour hold good even in to-
day's context and environment, it is important to recognize the emergence
of a powerful media that has an impact on how consumers perceive a
brand and its message. YouTube is an example of how user-generated con-
tent can exponentially catch up on the Internet among millions of con-
sumer within a matter of short time. Toyota's second least expensive car
Corolla is targeting youngsters who are digital natives immersed in user
generated media like YouTube. The brand spent US$ 4 million on its You-
Tube campaign. It offered monetary prizes to the best user-generated com-
edy. Users of online media comment on advertising, generate their own
advertisements, participate in contests and network with other users/pro-
spective users of the brand. Word of mouth or buzz (negative or positive)
is very much real and brands need to carefully weigh their options before
committing themselves to online media. General Motors is planning to
spend US$ 3 million on online media and one-one marketing in the next
three years (53 percent of Americans were expected to have watched vid-
eos online in 2008). Johnson & Johnson's anti-aging lotion Aveeno built
a video around a well-known British artist and the video was watched
by 1.2 million people on multiple video-channels. Closer home, Sunsilk
attempted “gang of girls” Web site to bring together the target segment.
Mouthshut.com offers advice on several product categories and brands
from opinions of consumers/critics. Red Bull's Web site is a reflection of
the brand's unique positioning to back up the “energy” proposition of its
soft drink offering. The Web site's association with adventure sports and
youth-oriented culture strongly connects with the target segment, besides
blending in with its integrated marketing communication elements.
Coffee and Consumers

Café Coffee Day has a number of outlets in several cities in India. While
it attracts youngsters (teenagers account for 25 percent of its customers,
38 percent are from the age group of 20–24 years and 29 percent from
the age group of 25–29 years), it also attracts some percentage of older
people who may feel young at heart (cognitive age). It has a strong as-
sociation with the “coffee experience” rather than just the taste of coffee
(conditioning based on associations). Experiential marketing is associ-
ated with different sensory organs and hedonism (or pleasure seeking)
is associated with consumption of a product for intrinsic enjoyment.
The coffee (taste), socializing (hedonism in fun and frolic with a group
of friends) and the ambience (appeal to the aesthetic aspect of the in-
dividual) combine to make the experience worthwhile to be repeated
by loyal consumers (loyalty because of instrumental conditioning that
happens because of positive reward association with the product/ser-
vice offering). The chain follows a cluster approach (locating several
outlets in a specific geographical area to ensure it acts as an entry bar-
rier to competitors who may want to enter the same geographical area)
not only because of its supply chain advantages but also because of the
existing need (recognition of a gap between the desired state and the ac-
tual state (consumer's need for such an outlet to relax) among consum-
ers to visit such outlets in a specific geographical area. The need may be
slightly different for different segments of consumers. Some may relax,
some may hold serious professional discussion and some may spend a
quiet time with just their laptops (for which the outlet has wi-fi facili-
ties in some outlets). The chain has about 100 outlets in Delhi. Given
the fact that coffee consumption is part of the South Indian's culture
while tea is more a part of the culture of North India, the outlets serve
cultural delicacies inviting consumers to try the coffee in an effort to
woo the consumers to the outlets (cultural aspects are useful across cat-
egories and the brand had made good use of these factors). The brand
also has sales promotional tie-up with brands like Airtel and Levi's that
also have strong youth associations (the affective part of attitude gets
strengthened when such associations evoke specific feelings). Custom-
ers feel that Café Coffee day is the place they frequent more after their
home/workplace or college (a very positive affective component).
Diversity and Importance of Consumer Needs

in an Emerging Market
Raymond, iPod, Nike, Tag Heur, Fair&Lovely, Nokia and SRK (Shah
Rukh Khan) are brands that appeal to thousands of consumers. Parachute
hair oil and Tiger biscuits, too, have an appeal among tens of thousands
of consumers. The government's ration shop serving rice and commod-
ities, also appeals to millions of consumers. The diversity of need can be
appreciated in an emerging market like India where star hotels lack the
capacity to accommodate consumers during the peak season and where
30 percent of the population consumes food that has lower than 70 per-
cent of the caloric value required for a day. The segment of health care in
the country compares with the best in the world attracting and promoting
medical tourism, while every three seconds a child dies due to malnutri-
tion. Needs and wants are shaped by the psyche of consumers, disposable
income and the “environment” that is unique to each consumer. Segment-

ing, targeting and positioning are basics to uncover a group of consumers
who have some degree of commonality with regard to a need. A company
has to ensure that its offerings are in tune with the target segment's needs.
Consumer behaviour provides insights to marketers to enable them to de-
cide on the match between the needs of the target segments and the wants
provided by companies in the form of product or service categories/
brands. The marketing strategy of a company requires consumer insights
to produce and offer the brand with appropriate marketing mix elements.
The low priced sachets/packets of Chik shampoo and Tiger biscuits are
examples of associating the needs with wants of consumers at the lower
end of the socio-economic spectrum. Given the diversity of consumers in
India with several regions/tastes/cultural aspects, and the demographics
and psychographics of consumers, consumer behaviour plays an import-
ant role in providing inputs to marketing strategy.
Consumer Behaviour and Marketing Strategy

While the behavioural aspects concerned with marketing are dealt with
in this book, consumer behaviour is only one of the inputs to successful
marketing strategy. The history of the brand, the nature of the category,
the kind of competition, the number of product categories the company is
in, its infrastructure with regard to manufacturing and the capabilities of
the competitors to swiftly address changing consumer needs are some of
the other vital aspects that are inputs to a brand's success. Many a time, a
good brand of the yesteryear may struggle to make profits in the present-
day context even after successfully launching a brand. Sony has built up
a reputation for quality the world over and has launched a number of
successful products including the Play Station, a computer-based gaming
device. But its Play Station 3 has made losses of around US$ 3 billion in
the last three years and Sony's TV division too, has not been impressive
from the view point of profits. Microsoft's Xbox and Nintendo are brands
that compete intensely in this category with Sony. The chairman, Howard
Stinger, has said that his priority is to make a turnaround to make gam-
ing and TV division profitable. Applying consumer insights to marketing
mix elements is vital from the learner's viewpoint.
Captive Consumers
Airports have become popular places for retailing and advertising brands.
About 14 million passengers went through Mumbai airport, in the year
between April 2006–April 2007 and an IMRB study has shown that they
spend considerable amount of their time in pre- and post-departures.
Seventy-five percent of the passengers pay attention to advertising inside

the airport. Forty-two percent of the passengers buy something at the
stores or restaurants located at airports.
Café Coffee Day has footfalls between 1800–2200 a day and it is pres-
ent in a number of airports. There are fashion brands retailed at the air-
ports. The “captive consumers” at airports hold several possibilities. Im-
pulsive buying for brands ranging from chocolates to fashion apparel
can take place in such places if the point of purchase material is appro-
priate. Strengthening brand associations is another possibility. A brand
of mobile phone advertised for youth (like Yuva phones from Motorola)
can conduct frequent events among youth to strengthen its brand asso-
ciation. Given the waiting time of passengers, new concepts can be mar-
keted through kiosks or brochures or “in-airport” stalls. A new form of
fast food for diabetes (that is also expensive) can be effectively retailed
and a kiosk can be used to provide awareness about the health benefits
of the offering. Whether it is developing a perception or attitude creation
about a new brand, airports can be made use of for effective overall in-
tegrated marketing communication. Airports also have the advantage
of capturing the attention of consumers at the higher end of the socio-
economic bracket and lend themselves amenable for premium brands.
It Is Consumer Behaviour all the Way

Massey Fergusson is a tractor brand and it has a very interesting approach
towards marketing tractors to farmers in the hinterland. It positioned itself
as a “tensionless” tractor with TV commercials that draw upon the local
culture (using the concept of culture which is important in any emerging
market) of arbitrating quarrels through educated persons or through el-
ders. This is a tradition that is common in some parts of South India, and
even today minor matters are settled through such a process. One of the
TV commercials showed a young and educated man attempting to amic-
ably dispose off property dispute between two brothers (such issues are
quite common in semi-urban and rural areas), and the commercial ends
with the “tension-free” tagline of the brand. There is comparison between
the tensionless manner in which disputes are resolved and the propos-
ition of the brand. The brand also sponsored a popular “Listener's choice”
program in one of the regional TV channels. The program show-cased
farmers who were satisfied with the tractor and also showed movie songs
associated with the favorite actor of the respective farmer who was inter-
viewed in the sponsored program. There were farmer consumers across
age groups and some of them requested songs from movies of yesteryear
(usage of emotion associated with nostalgia, which is not very common
among advertisements). The emotion was also appropriate. In between
the song sequences, the farmers highlighted the benefits of the brand of
tractor (developing cognitive beliefs associated with the brand). There is
also a sense of identity provided to the satisfied farmers who may have
felt important when they were interviewed as part of a program watched
by thousands of viewers (identity is a strong emotional benefit for the
segment, especially when most advertisements focus on urban segments
and visuals). These aspects possibly can promote the viewership among
target segment consumers through the word of mouth (important for any
consumer durable purchase). Prospective consumers would also feel like
collecting information on the brand (triggering of a need).
3
Consumer Decision Making

and Branding Strategies
While a number of psychological variables are useful in understanding the

consumers' psyche, it is worthwhile to probe into some specific aspects of con-
sumer decision making (CDM) in order to formulate marketing strategies.
Consumer decision making enables marketers to visualise a broad framework
of stages and apply psychological or/and group variables to a specific prod-
uct/market/brand situation. The process of decision making can provide sev-
eral trigger points at a conceptual level, especially when a brand wants to pos-
ition itself in a crowded product category or enter a “new-concept” product
category or reposition itself.
Consumer Decision Making: Important

Dimensions
 What kind of approach (strategy) should a brand have when it enters a
crowded category with which consumers are familiar (soaps, shampoos,
two-wheelers, etc)?
 How should a brand promote a “new-concept” product and how are the
stages in the CDM framework useful?
 What strategies, other than advertising, may be useful in the specific
stages of consumer decision making?
 How can celebrities be used at different stages in the decision making
process?
 What are the different kinds of decision making consumers indulge in?
 What are the specific differences in CDM between FMCG products and
durables?
 Can needs be differentiated based on what a brand offers?

 Do consumers have different kinds of “sets” from which they select
brands?
 What kind of strategies can a brand use when consumers search for
information?
 How do consumers use evaluative criteria to take a decision across
brands?
 What kinds of factors influence the selection of retail outlets when a con-
sumer decides to buy a product?
These dimensions are strongly linked with one another and also play a
significant role in CDM. They focus the attention of any marketer in consumer
product categories towards how consumers perceive a category, a brand and
their own needs.
The Basic Model of CDM

Figure 3.1 shows the several stages involved in consumer decision making.
It is useful to understand the basic model of CDM and its implications for
marketers before studying its detailed aspects. Whenever marketers introduce
a new product category with a new concept, they have to do concept selling at
the need stage. This is the stage where the actual and desired states of the con-
sumer are examined. Ceasefire, the mini fire-extinguisher kick-started a wave
of demand for the product among households (The brand does not retain its
hold over the market for a variety of reasons but the objective here is to reflect
on how the brand used an approach to market a new concept). It marketed the
concept using primary advertising. Though the concept of fire-extinguisher,
by itself, was not new to the market, the concept in its mini version was new.
It triggered off a perception of being very different from the huge, unwieldy
ones one saw in cinema halls. The primary advertising (with fear overtones)
said different kinds of fires required different kinds of extinguishing gases and
Ceasefire was “the” answer to the need. Concept-selling discusses product
benefits and how these can solve the existing problem of consumers or help
them reach a “desired state”. While primary advertising concentrates more on
product benefits to create a market for the product, secondary advertising dis-
cusses the brand. In case a pioneering brand brings in a new-concept product,
Need Information Evaluation of Purchase Post-

search alternatives purchase
Figure 3.1  Stages in Consumer Decision making

3  Consumer Decision Making and Branding Strategies 83
secondary advertising has to supplement primary advertising to ensure that

the brand gets the competitive advantage of having marketed the concept.
Titan may not be a pioneering brand in quartz watches. But it is currently lead-
ing because of its brand-building efforts.
Which Stage to Target

While the need stage is important for new-concept products, there may be a
number of categories where most consumers may be in the purchase stage.
Hence, this stage is important for those product categories. For example, con-
sumers who are in the purchase stage in the category of soaps (in most mar-
kets in the country) may not get too involved with information search or the
evaluation stage, given that it is a low-involvement category. They may try a
variant or a new brand that they have seen on TV or at a retail outlet. An ex-
isting brand may perhaps bring in a variant (Hindustan Lever came up with
Lifebuoy Active at a competitive price to ensure Lifebuoy loyalists did not
pick up a competitive brand during the purchase cycle) or re-launch the brand
(Margo) to ensure that most consumers stay with it. Hamam's herbal variant
in soaps and Colgate's herbal variant in toothpastes are examples of retaining
consumers at the purchase stage with brand equity and loyalty.
Strategy for Durables

A different approach may be required to use the basic CDM model in the cat-
egory of durables. The stage of information search (for categories with which
consumers are familiar) is important for new brands, especially for those which
provide value or provide new features. LG and Samsung in televisions, and
LG refrigerators, used the print media extensively to highlight the new fea-
tures offered in their brands. This is one of the reasons for their above-average
performance in terms of the brand growth. This stage is also important for
categories like the microwave oven and electric cooker for which brands may
have created a need in the last decade in niche markets. The stage of informa-
tion search provides the consumers with specific benefits and pulls them to-
wards the purchase stage. It may be a good idea for a microwave oven or elec-
tric cooker brand to use the information-search stage with the purchase stage.
The latter occurs when consumers are pulled to retail outlets through the infor-
mation a brand provides. Demonstration of the brand is vital at the purchase
stage as this provides a heightened motivation to a consumer to purchase the
brand. Some of them may also be impressed by the brand and stack it away
in their memory for later reference. Evaluation of alternatives in such cases
also happens along with the purchase stage when consumers may want to ob-
serve and evaluate brands based on their perception of brand benefits, price,
service and the demonstration at the retail outlet for “new-concept” products.
It may be a conceptual error to take the consumer to the purchase stage by of-
fering the new-concept product as a freebie along with another product priced
much higher than the new-concept product. For example, if a brand of electric
cooker is offered free with a refrigerator when the consumer is not even clear
about the product, the following can take place:
 Due to the high visibility campaign which is run to highlight sales pro-
motion, prospective consumers (for the new-concept product) may think
that the latter has failed in the market and, hence, is being advertised as a
freebie and/or
 The consumer may not use the new-concept product as he does not have
adequate knowledge either about the benefits or about the usage of the
product
It must be emphasised at this stage that for any new-concept product

to succeed (especially durables), positive word of mouth is required at the
post-purchase stage (which succeeds the purchase stage) in CDM. A satis-
fied consumer of a brand of microwave oven can be an opinion leader in the
prospective target segments (a housewife in a residential area). This kind of
opinion leadership has a tremendous credibility. Another important aspect
of new-to-the-market durables is the after-sales service in the post-purchase
stage. A company would do well to allocate an exclusive team to follow up
with consumers who are about six months into the product. The team should
make periodic visits/phone calls to these consumers to familiarise them with
brand usage, features and benefits. A period of six months is recommended
as a “usage warm-up” time. This is long-term investment for a brand though
it may lead to higher overheads in the short run. A happy buyer (within the
usage warm-up period) is likely to be a profuse advocate of the brand.
Applying CDM—New and Familiar Products

Information search and purchase stages also hold a lot of potential for multi-
level companies––a form of direct selling––like Tupperware or Oriflamme.
Given the nature of personal selling in the marketing of these companies, the
CDM model can be very useful (See Figure 3.2 (i)). Tupperware markets kit-
chen containers that carry a premium price and a lifetime warranty. Oriflamme
markets high-end herbal cosmetics. While cosmetics may be luxury items, per-
sonal selling gives an opportunity to the consumer to interact with the sales
personnel on several dimensions of the product, resulting finally in healthy
skin-care. In the case of Tupperware containers, the information stage offers
an opportunity to the sales personnel to convert it into purchase stage (trial of
the product). The personnel can emphasise the value delivered by such pre-
mium containers at a higher price-point. They can compare the product with
the usual containers the consumer is already using (a large chunk of the mar-
ket in the unorganized sector, which may not offer the quality associated with
an international brand) in terms of durability, air-tight characteristics and aes-
thetic appeal. Though the price is at a premium, the value perceived by the
consumer may motivate him/her to try the brand or choose from the several
variants of the company.
Need/Information Search Purchase
Usage of media—TV to Demonstration at the

create awareness and retail outlets
newspapers/ magazines
for detailed information
Evaluation of alternative brands

(done by the consumer at the
purchase stage)
Figure 3.2(i)  New Concept Product
Akai's Approach Providing value at the start of information search can

also take the shape of a high-visibility campaign for conventional durables
like TVs and refrigerators. Akai had phenomenal success (even though the
period of success was limited due to a variety of reasons) in the category of
colour television when the brand entered the Indian context. The “value” was
the exchange scheme the brand offered by taking into consideration the scope
and potential of second-hand TVs. There was a huge potential for such TVs
in semi-urban markets where people wanted to replace their sets. Akai suc-
cessfully used the “need” aspect of these segments along with a high visi-
bility campaign to capture a sizeable chunk of the market in a short time. It
should also be noted that the brand ran campaigns that reassured consumers
about the quality of the components used in the brand. This insured the brand
against any post-purchase dissonance (See Figure 3.2 (ii)).
Semi-urban Need Value

markets second-hand
TV Need Information
on
Urban Replacement promotion
markets TV
Quality of
Components
Post-purchase Purchase at
dissonance the retail
prevented outlet
Figure 3.2(ii)  Familiar Product: Akai's Approach.

CDM and Celebrity Usage

Santro, the car brand, is an interesting case of celebrity usage in the context of
CDM. As the brand was new to the Indian context, it used a celebrity to get
into the “attention span” (which can be associated with the information search
stage) of consumers. The brand ran a campaign which explained the prob-
lems associated with cars, and how Santro was built to address these prob-
lems. The next was an advertising campaign comparing Santro with Matiz
and Zen––close competitive brands. These strategies associated with the infor-
mation search stage reduced the perceived risk among consumers (since the
brand was new in India, perceived risks had to be addressed) and a number
of them bought the brand. The excellent service provided by the company
(in the perception of consumers) led to a positive post-purchase feeling. This,
then resulted in a positive word of mouth (see Figure 3.3).
Santro’s approach (durable)
Unknown Celebrity Attention Interest

brand in the brand
Good Positive Purchase

word of experience
mouth
Figure 3.3  Celebrity Usage: Santro’s Approach
Impulsive Purchase and CDM

Soft-drinks, chocolates, branded blades, biscuits and ice-creams are products
that fall under the impulsive-buy category. The need reflected at the begin-
ning of the CDM model is associated with an urge to buy the brand disre-
garding the consequences of purchase. (Impulsive buying is treated in a sep-
arate section.) This need can be triggered off by attractive display or brand
packaging or POP material. Gillette (blades), in a number of markets in the
world, attempts to trigger off impulsive buying with an attractive display at
the point of purchase. Consumers (a significant number of them), in a num-
ber of markets, buy more blades than what may be currently required and
keep them in stock, probably due to the impulse triggered by the brand. When
such purchase takes place, the consumer may move directly from the need
stage to the purchase stage. A large retail outlet like Food World may be inter-
ested in researching the impulse profile of its consumers across product cat-
egories to take decisions on display arrangements. The “impulse profile” of
consumers may vary in terms of psychographics and demographics. Hence,
it should be obtained for different kinds of segments. Normally, impulse prod-

ucts are low-cost items unless the target segment is at the upper end of the so-
cial strata and is willing to splurge on expensive items as a result of impulse.
Substitutability of Products
The need stage has assumed significance in the current day competitive con-
text when brands may compete in related product categories (“related” in
terms of the needs of consumers). The competitive aspect of some categories
may be indirect and of some others, direct. For example, ice-cream may com-
pete with soft drink, mithai or snacks and this can happen in an indirect man-
ner. Though substitutability does not occur in the real sense of the word, the
consumer prioritises his/her need before making the purchase. There is a pos-
sibility that he/she may even postpone purchase of other priority items. On
the other hand, such a thing may not happen at all in the case of durables.
Running a high-visibility campaign for both the product category and the
brand can help a marketer to “place” these on top of the consumer's priority
list (in FMCG categories). Walls ice-cream adopted this approach and created
interest in the category by having a number of price points in the category. In
the case of durables, the brand can be prioritised by offering value/benefit,
which is of interest to the target segment. In entertainment products, TV is a
highly prioritised product in both urban and rural markets.
Another interesting product category is that of branded mineral water.
A sizeable chunk of the market is in the unorganized sector, with Bisleri as the
market leader. Aqua Fina from Pepsi and Kinley from Coke are brands of min-
eral water, which target the youth and have been launched on lifestyle pos-
itioning. Nestle and Britannia are other companies attempting to build brands
in the category. The reasons why soft drinks and mineral water are consumed
are thirst, group activity and fun. In fact, soft drinks, in the recent times, are
more associated with fun than thirst. Each category is likely to substitute the
other, depending on the positioning. For example, if the fun element is asso-
ciated with the positioning of a brand of mineral water, it may be perceived
as a substitute for soft drinks (aerated or others), not just during summer but
through the year. Bisleri may have to increase its retail availability to match
that of Pepsi and Coke if it aspires to be a substitute for colas/soft drinks.
The need and purchase stages (during which the positioning strategies of
brands are likely to work) are important for building brands.
Types of Consumer Decision Making

There can be different degrees of CDM depending on the unit cost of the prod-
uct, involvement levels of consumers with regard to categories, effort involved
and the importance attached to the purchase. At the outset, there is a need to
differentiate between purchase involvement and product involvement before
taking up the different kinds of CDM. Purchase involvement is the interest
in purchase process triggered off by a need to consider a particular purchase.
This kind of involvement is short term and may involve an individual or a

family. Product involvement is enduring and consumers may be involved with
a brand (Colgate, for example) or with the product category of toothpastes.
A high degree of involvement with a brand may form the basis of brand loy-
alty and a loyal consumer may prefer the brand without much information on
it or evaluation. Purchase involvement and product involvement may have
several implications for marketers. For example, a situation can be highlighted
to create purchase involvement and brand attributes can be focussed on to cre-
ate brand involvement. A new kind of offering from the LIC of India can high-
light the need for the offering (purchase involvement) and also underscore the
benefits of the brand (brand involvement).
Habitual CDM This kind of CDM involves no decision making at all.

The consumer buys his/her preferred brand whenever a need arises and the
evaluation of the brand may take place only when it fails to perform as ex-
pected. This kind of CDM happens only when there is very low involvement
with the purchase (involvement levels and decision making have been treated
separately). In such situations, even the alternative of not buying the product
may not arise. A consumer who has run out of toothpaste may buy the same
brand. There can be two types of decisions under habitual (also referred to as
nominal decision making) decision making – brand loyal and repeat purchase
decisions. Repeat purchase decisions (without loyalty) are the ones that the
consumer makes without staying committed to the brand. This may be out of
sheer inertia or non-availability of other brands or alternatives. There is an-
other situation in which consumers may buy a brand sans commitment. A con-
sumer may keep buying a brand of detergent until another brand challenges
the logic of buying the former.
Limited CDM This CDM exists between habitual or nominal CDM and
extended CDM. The difference between habitual and limited CDM is that
the consumer may search for limited information before taking the decision.
A consumer who has run out of tea may compare brand prices or sales promo-
tion offers. He/she may want to try a new brand and hence, may get informa-
tion on the quality of tea leaves brands use or even consider the newness of an
offering. In limited CDM, there may be internal search (memory) as also lim-
ited external search. Normally, limited CDM also occurs in low-involvement
conditions. In both nominal and limited CDM post-purchase dissonance is
highly improbable.
Extended CDM This kind of CDM reflects a high level of purchase in-
volvement. An extensive memory search or an external search results in com-
plex decision making with a number of alternatives/choices open to the con-
sumer. There is likely to be dissonance after purchase on the correctness of
the decision. (This aspect of cognitive dissonance has been dealt with separ-
ately.) Extended or complex CDM is likely to occur when the unit cost of the
product is high and when there is a great deal of involvement as stated earlier.
Products like cars, PCs, homes and televisions are categories that are likely to
go through this kind of decision making. There are also certain products/ser-
vices that are likely to receive significant emotional inputs in the CDM process
and they may be as important as the cognitive information associated with
the evaluation of high-involvement products. For example, health resorts/
holiday packages are being heavily advertised. Besides the financial aspects
and information about specific locations, decision making draws heavily on
the importance the consumer places on the experience which he/she is likely
to have, moments of happiness he/she can gather, or how important are the
memories for the consumer and how well does the family, if involved, per-
ceive the experience.
The three types of CDMs discussed above are summerised in the follow-
ing Figure 3.4. Marketers can, through primary research, find out the degree
of involvement (even in durable products), dissonance-inducing aspects (post
purchase), how a specific brand addresses the dissonance (with its unique of-
ferings as against competition) and how specific marketing mix elements can
be fine-tuned to the expectations of consumers. For example, a washing ma-
chine or a refrigerator brand claiming low consumption of electricity should
be in a position to demonstrate its claim under regular operating conditions. In
the absence of this exercise, dissonance is likely to set in, especially in a com-
petitive positioning context.
Brands and CDM

It would be of interest for marketers to examine how consumers decide to buy
a brand. This has a number of implications on brand positioning, introducing
trial offers or examining what kind of objectives advertising should address
with regard to a given brand. Should the advertising enhance brand awareness
Type Products Consequences Di ssonance Degree of

involved of CDM involvement/
effort in CDM
Nominal Low-cost Low Nil Low

items
Limited Low-cost Low Nil Low

items
Extensive High-cost High High High

items
Figure 3.4  A Comparison of CDM Types

so that consumers consider it or should it mention and highlight brand benefits

so that consumers use the information in the final phase of decision making?
It will also be useful for marketers to find out about consumer-readiness with
regard to purchasing the product category so that it can be appropriately used
for communication strategies. For example, an answer to what kind and how
many consumers use a hair dye currently and how many are prepared to try it
can provide useful information. Further research into the category and aware-
ness levels of brands (old brands under the category line–Godrej, and new
brands like L' Oreal) will also be useful. At the next level of product differen-
tiation, it may be worthwhile to find out how many consumers are willing to
try out a brand that can be used to colour as well. As it is obvious, awareness
of the category, brand, benefits, perception of benefits and intention to buy the
category/brand are critical when specific stages of brand consideration are
thrashed out for formulating strategy.
The “brand set” CDM process (to be used along with the basic CDM model
and types of CDM) is shown in Figure 3.5.
The consumer for any product category progresses from “total number
of brands” to “choice set” (impact of different stages may vary from FMCG
products to durables). The “total number of brands” refers to the total num-
ber of brands in a category available in the market (200 in mineral water, for
example). “Awareness set” refers to the set of brands the consumer is aware
of in a specific category. Ray Ban launched a campaign to enhance the aware-
ness levels of the target segment during its entry stage into the Indian market.
“Consideration set” is a set of brands a consumer is likely to consider based on
his/her criteria and “choice set” is the set of brands from which the consumer
takes the final decision on buying a specific brand.
While product/market situations and the USP of a brand and other details
from primary research data are to be considered (as stated earlier) before the
brand can finalise its strategies using the “brand set” model, there is growing
research evidence to show that point-of-purchase (POP) material at retail out-
lets is useful in influencing the purchase decision of the consumer. This means
that in certain categories (especially FMCGs), POP material can take a brand
into the “choice set” stage at the point of purchase (retail outlets). In certain
categories of durables, information on new features can place a new brand in
Total Number Awareness Consideration

of Brands Set Set
Choice
Set
Figure 3.5  “Brand Set” CDM Process

the “choice set” of consumers (see Figure 3.6). This is advantageous to brands
in durables that are high-involvement purchases where there can be a number
of established brands strongly placed in the “awareness” or “consideration
set”. For example, there were a number of well-known/established brands
in the refrigerator and TV markets when LG entered these product categories
in India – Godrej, BPL, Videocon, Akai, Whirlpool, Kelvinator and Voltas to
name a few. But LG's success can be attributed to its positioning based on its
novel features in these categories, which placed the brand in the “choice set”
stage of CDM model.
LG's TV had the golden eye feature (“wrinkle-free”, easy viewing) and its re-
frigerators came with the “nutrition-preservation” feature when most competi-
tive brands were positioning themselves on traditional propositions. It should
be noted that the “choice set” connected with LG in this situation, is relevant to
those consumers who were looking for novel features in their TVs or refrigera-
tors. In the TV category, LG appealed more to the replacement (CTV) segments.
The following are the important aspects about this CDM model:
1. It provides directions for a new brand to make an impact on consumer
psyche.
2. With appropriate strategies, it may be possible to eliminate stages or at
least ensure a short period of transition across stages in the “brand set”.
3. There is a need to use specific strategies (communication as well as other
aspects of marketing mix elements) to take the consumer quickly to the
“choice set” stage. For example, Gillette ran a campaign in India for a
shaving gel (a niche market) by associating this version with shaving
brushes. (Shaving brushes are part of the shaving for a majority of con-
sumers even though gel can be used without a brush). Besides, the brand
also came out with special packages that could get the attention of con-
sumers in the retail environment.
The “brand set” model provides creative scope for marketers to consider
moving a brand from one stage to the other depending on the changes in needs
and psychographics of consumers and competitive offerings. It can be used as
a tool in a dynamic environment.
New Not Awareness Trial Choice

brand radically Set Set
differentiated
Unique Awareness Choice

Dimensions Set Set
Figure 3.6  Branding and “Choice Set”

CDM and Upgrading the Consumer—A Continuous

Process
A number of FMCG companies have product-line offerings at various price
points. Though these prices points are oriented towards different target seg-
ments, these companies will also be interested in ensuring that the consumer
upgrades from one offering to the other. Upgrading the consumer also ensures
that he/she does not leave the brand and try or become loyal to a competitive
brand. For example, there are consumers who use ash to clean their teeth, who
need to be upgraded first to a toothpowder and then to an entry-level tooth-
paste. It may be difficult to upgrade consumers from the basic entry level of
the brand to its “highest” offering in a product category, but there has to be a
plan to at least upgrade him/her to a few price points over a period of time.
This may involve a number of elements associated with the marketing mix.
Colgate has a toothpowder at the lowest price point followed by a number
of offerings at higher price points – Colgate Dental Cream (CDC) at the next
level; Colgate Herbal between the CDC variant and Colgate Gel. It also has
Sensitive Care (to compete with HLL's Mentadent), which has a strong thera-
peutic proposition.
The toothpaste market shows two basic segments in terms of consumer
response. One, the traditional toothpaste oriented towards functional benefits
like cavity prevention, strengthening of gums and fresh breath. Two, the cos-
metic segment or the gel segment has been positioned for the youth (Close-up
and Colgate Gel) on the lifestyle platform. A brand like Colgate Total, which
is at the top of the price points, may be able to attract both the segments (func-
tional as well as upgrades from the gel version who may want to revert to a
functional toothpaste with superior benefits). Incidentally, Colgate Total (with
its 12-hour protection) also used a celebrity with charisma and appeal for the
youth. Colgate Total was initially launched during the mid-eighties with the
premium pricing strategy. The brand was re-launched during the nineties with
the celebrity and it is positioned as a brand with a number of functional ben-
efits and an “all-in-one” proposition. ITC's Vivel Soap is another example of an
FMCG product backed by celebrities (See Plate 1).
Getting the consumer to use an updated version of the brand involves ap-
plying strategies that have an impact on some stages of the CDM model, as
shown in Figure 3.7.
Brand building is a continuous process, which has the objective of retaining
and upgrading consumers.
Information Search and CDM

Consumers increase their effort on information search in varying degrees.
Some make an extra effort to probe and explore the information about product
categories/brands while some others go through sources other than advertise-
ments, such as positive word of mouth. Information search may be internal or
memory-based. It may be external, in which the consumer scans the environment
Lowest Price Point

Colgate Toothpowder
Binaca Some stages
Colgate Herbal of CDM
Strategies
CDC
required on • Need
Sensitive Care
all variants • Information
Total
search
Highest Price Point
• Alternatives
• B rand • Purchase
visibility
• Clear communi-
cation of benefits
• Trial offers
• Retail display
Brand Building
Figure 3.7  CDM and Upgrading the Consumer over Brand Offerings
to offer inputs to the CDM process. Information search, takes effort, time and
money. There are benefits of information search, which include selection of a
brand that has a better value or higher quality or one that reassures the consumer
against his/her perceived risks associated with the purchase.
Nature of Information Search

Whenever a consumer feels a need, one has to scan the memory to determine if
a satisfactory solution can be found and if there are any alternatives to that so-
lution. A consumer who is hungry can think of a fast-food restaurant, a brand
of fast food or even prepare a meal himself/herself. The consumer may also
consider the type of food and associated costs. This is internal search. If he/she
cannot hit a solution, he/she may undertake external search. (The same con-
sumer may also want information about eateries when he/she is in a new city.)
A number of decisions that consumers take with regard to low-involvement
products are likely to be based on internal search. External decision making
may include the following aspects:
 Opinions and attitudes of friends, relatives or opinion leaders.
 Information provided by promotional aspects associated with the brand
like advertising, personal selling or brochures.
 Direct product trials (two-wheelers or cars).
There is another type of “ongoing” information search, which consumers
undertake without a specific problem. For example, there may be consumers
who are “crazy” about motorcycles. They may or may not own the vehicle but
may be interested in any information on motorcycles. These consumers are in-
volved in an “ongoing search” with regard to this product category. This kind
of information search occurs both because of the pleasure involved in seeking
information and also because such information may be useful later.
This information search may be extremely useful to marketers. It may be
worthwhile to identify a set of consumers who may not want to buy the prod-
uct at a given point in time but are interested in the category due to their high
level of involvement. A brand that is able to build a relationship with such con-
sumers stands to gain when the consumer is actually ready to buy the prod-
uct category. There is a great possibility of consumers considering a brand
with which they are not only familiar but have also had some interaction. TVS
Scooty did just that through an online promotional method involving the tar-
get segment (youth) and collected valuable information in a short period of
time. Establishing contact and nurturing the established relationship through
specific media and promotional methods appropriate to the “ongoing search”
segment is extremely useful to the brand, especially when the category has
competition.
Types of Information Sought CDM requires following the types of

information alternatives available, criteria for evaluating the alternatives and
the performance of each alternative. A consumer is likely to search for infor-
mation until he/she is satisfied that he/she has these types of information.
Different brands with different USPs form the basic information with regard
to the alternatives available. Normally, in a number of consumer product
categories, consumers perceive and interpret this kind information through
the positioning strategies of brands. For example, Lux can be positioned as
an entry-level soap; Sunsilk for involved hair care; Clinic Plus, a therapeutic
shampoo for the family and Clinic All-Clear for the youth. In fact, the per-
ception of consumers of the probable outcome of using the brand (getting rid
of dandruff or having bouncy, glamorous, attractive hair) is also an outcome
of the positioning strategy of the brand. The positioning should be such that
consumers identify themselves with it and perceive the benefits of the brand.
A brand of toothpaste that was launched a few decades back, had fast-spread-
ing action as its USP and consumers were not able to identify themselves with
the benefit. Clear-cut positioning of benefits (functional or emotional) helps
the brand to influence the evaluative criteria that consumers (target segment)
may formulate through external search. The toothpaste gel, with its cosmetic
white teeth and lifestyle positioning, has appealed to the youth and created a
new criterion in the category. Consumers also have what is called “inert set”
of brands or “back-up” brands about which they may accept information.
This brand/s may be bounty if their (consumer's) preferred brand is not
available. A consumer who has made up his/her mind to buy Colgate Total
based on the “multiple benefits” criteria may choose Aqua Fresh if the former
is not available. This happens because consumers may be tuned to informa-
tion that is close to their evaluative criteria. This can also happen in durables
but branding plays a vital role because of the high degree of perceived risk in
high-involvement products.
The expectation on the performance of the brand depends on four aspects:
market characteristics, brand characteristics, consumer characteristics and
situational characteristics. Market characteristics include available alterna-
tives, how well the product category has been accepted, (diffusion of innov-
ation—this has an influence on reducing the perceived risk and/or making
the product category a necessity, for example, gas stoves) and availability of
information through advertising or sales personnel, independent sources or
through personal sources. Brand characteristics depend on brand differenti-
ation and the value perceived (the benefits perceived also dependent on this).
Consumer characteristics depend on learning and experience, social status,
age in the life cycle, perceived risk, familiarity with the product and the level
of involvement with the product category. Situational characteristics include
availability of time, whether the product is for personal use or a gift, physical
and mental energy to gather information and affordability to buy the brand.
The outcome in terms of performance is complex and based on several factors
associated with the types of information sought. This, in turn, depends on a
set of characteristics.
The influencing factors (types of characteristics) have significant implica-
tions for marketers. A microwave oven, for example, may not be perceived as a
high-priority durable item in households where one of the spouses does not go
out to work. An online grocery store is likely to attract the attention of a busy,
young and aspiring couple who is pursuing an active career. The search for
information on brands like BMW and Mercedes may be important for niche
consumers who may be actively involved in deciding on the type of car to buy,
not so much for its utility as for its status. The kind of information search by
this niche will be quite different from those who may also learn about this in-
formation without intending to buy the brands.
Perceived risk, as a consumer characteristic, can provide several dimensions
in which marketers approach and provide information to a target segment
(especially in durables). For example, there may be a brand in electric cars,
which wants to launch itself in India. The information search involved with
regard to the perceived risks of the consumer can open up several strategies
associated with the marketing mix elements planned for the launch. This can
be shown as follows:
Perceived risks about, and information search for an electric car brand
Risk factor Implications for the brand

Social risk Will the appeal of an electric car be comparable with that of a tradi-
tional one? (in terms of status)
Financial risk If the brand is going to cost as much as a regular car at its entry
level, will it provide value? Is buying the brand an experiment?
Performance risk Will this new type of car perform as well as a traditional car with
which the consumer is familiar?
Operational risk Will consumers be comfortable driving and getting used to the op-
erations of the electric car when they have all along driven the con-
ventional car?
Financial operational and performance risks may be associated with the perceived benefits
of the brand and can be addressed as “value risk”.
It may be worthwhile for marketers to obtain primary information from

prospective consumers on the types of perceived risks associated with a prod-
uct category or a brand introducing a new feature not associated with the cat-
egory. For example, if a brand in air-conditioners (like LG) advertises a feature
that provides “clean air”, there may be certain perceived risks associated with
the feature like after sales service because of the complexity of the product, the
value provided by the feature or even certain apprehensions about the process
through which the brand gives such a benefit.
Strategies of Applying Consumer Decision Making
(a) Maintenance Strategy

This strategy is quite applicable to regular FMCG products like soaps, tooth-
pastes, tea, coffee, biscuits and soft drinks. The brand is in a situation where it is
bought regularly (or habitually) and it has to ensure that the commitment levels
of consumers are sustained. Sustaining this favourable or habitual behaviour
may involve for a brand, product development, launching variants, ensuring
that advertising keeps the brand on top of the consumer's mind and avoiding
stock-out situations in distribution channels. The last one is as important as
the others because in a competitive situation, especially in low-involvement
categories, consumers are likely to try another brand in case their favourite
brand is not available at retail outlets. Point of purchase is important to ensure
that the consumer is further motivated to buy the brand. Colgate, Close-up,
Surf, Horlicks, Britannia, Lux and Red Label are some of the brands that have
employed this strategy. Red Label launched its brand with vitamins; Britannia
offers a number of variants; and Pepsodent introduced a two-in-one toothpaste
(gel with the usual white toothpaste). The objective of such a strategy is to en-
sure that consumers do not leave the brand. Iodex, Vicco, Amrutanjan, Robin
Blue (whitener) and Promise are brands that were extremely popular a few
decades back. If these brands had pre-empted their competitors with updated
offerings, they would have kept their hold over the respective market.
( b) Disrupt Strategy
When a brand is not a part of the habitual buying pattern or not in the “con-
sideration set”, there is a need for the brand to disrupt the existing decision
making pattern. This is difficult because the consumer may not seek exter-
nal information (under nominal decision making). Free samples and cou-
pons are ways to break the habitual decision making of consumers oriented
towards a competitive brand. This strategy can be very useful for brands that
are new to the market and have to compete with a number of established
brands in the categories. A significant and a relevant brand benefit can also
be useful to break habitual decision making. Fair & Lovely is strongly associ-
ated with fairness creams. The brand is being used by a large consumer base.
A new brand—Fairever (with the addition of saffron) was able to capture a
sizeable “trial share” when it was launched in the market. There have been
several brands like Ovaltine, Ragimalt and Drinking Chocolate in the last sev-
eral years in the category of malted drinks. But Horlicks continues to dominate
the market. Competitive brands in this category could have built up an effect-
ive disruptive strategy. A herbal shampoo would do well to sample the new
brand, especially in specific geographical areas where national brands may
experience weak loyalty. Anchor toothpaste ran sales promotional schemes in
semi-urban areas where category loyalty was not as strong as it is in urban
areas. Good retail brands offer excellent scope to disrupt FMCG purchases as-
sociated with the leading brands with which consumers have been familiar for
decades. Penetration pricing with advertising visibility during the time when
consumers “downtrade” may be a very effective disrupt strategy. Low prices,
especially with no-frill services, have succeeded as disruptive strategies in the
airline services sector all over the world – Southwest Airlines, being a globally
known example. Penetration pricing backed up by good brand equity can also
be an effective strategy in the fast foods category. The pizza market in India is
dominated by MNC brands and Amul's entry with a penetration pricing pol-
icy (almost 60–70 percent below that of the existing brands) may be effective in
weaning away at least a section of consumers already consuming the product. A
value based on a higher price point may also be a good strategy. Reynolds was
introduced at a higher price point but consumers accepted the brand because
of the superior benefits associated with it. Disrupt strategy can also be effect-
ive in retailing. The success of Food World network of retail stores reflect the
manner in which consumers can be disrupted from approaching their regular
grocery stores in the neighbourhood. (It is to be noted that even today almost
97 percent of retail purchases are made in neighbourhood stores in the coun-
try.) The ambience, the width of merchandise, stock-keeping units (SKUs) and
the value offered in terms of sales promotion across categories are some of the
factors that may have worked well as a disruptive strategy for Food World.
The value (in terms of quantity and price) has been made a disruptive strategy
in the cola category by both Pepsi and Coke.
In a number of FMCG categories, close competitors keep resorting to both
maintenance and disrupt strategies, especially when there is a need to achieve
market share. Bisleri introduced a number of SKUs with a view to increase its
market share in the category of mineral water, in which the unorganized mar-
ket accounts for almost half the market.
(c) Capture Strategy

Limited CDM is an area in which consumers look out for very little exter-
nal search and they may purchase the brand again (unless it is not available).
A brand which is currently being used by consumers should ensure that it

captures a large share of the consumer's purchases (large because despite the
limited nature of decision making, consumers may try other brands in cat-
egories like soaps and toothpastes). The evoked set has to have the brand on
top of the consumer's mind. There may also be a need to introduce a number
of SKUs to ensure that consumers do not leave the brand (Close-up, Fair &
Lovely, Surf Excel and almost all the leading brands in the shampoo category
are examples). This is important in the Indian context because the unit price is
of vital significance and consumers may buy different brands for different oc-
casions. The dominant brand should ensure it increases the consumer's share
of purchases. In-store information (discussed later in the chapter) may be a
useful strategy. This may be a prerequisite for leading brands. The in-store
merchandising adopted by brands like Bournvita, Colgate, and Kit Kat in su-
permarkets is likely to influence purchase decisions when the consumers are
present at the retail outlet. Brand loyalty assumes a lot of significance in the
capture strategy. There may also be infrequently purchased items like antisep-
tic lotions and air-fresheners. A leading brand like Dettol or Lizol (in branded
floor-cleaning category) should ensure that it develops the market, builds the
brand and captures a large number of consumers as the market for the cat-
egory evolves. For example, in a largely unorganized market for floor-cleaning
products (household care), Domex and Lizol have built the brands and are at-
tempting to expand the market. If a leading brand in a category, which is yet
to evolve into a mass market, does not take the lead, late entrants may make
a dent into the market share of the pioneering brand as the market evolves.
Vim, in the dish-washer category, held its own for several decades. But it was
forced to come out with variants and promotional campaigns in the recent
times because of the growing presence of regional brands like Sabeena and
Shine-it. Vim launched the major “Vim Challenge” campaign to ensure that
it sustained its pioneering lead. Capture strategy also emphasises the need to
introduce a downward stretch in a product-line, especially if a company is a
market leader. HLL, a leader in the detergents market, was forced to introduce
Wheel because of Nirma's onslaught at the lower end. Monitoring the envir-
onment and developing the product-line as the market evolves, is an import-
ant strategy. Colgate launched its gel version several years after a competitive
brand Close-up was launched in the market to attract the youth segment.
(d) Intercept Strategy

When the consumer is in the limited CDM mode and the brand does not exist in
the evoked set, a marketer has to intercept to ensure that the brand gets into the
(evoked) set. Sales promotion is one way of getting there and ensuring brand
trial, but the brand should not get into the sales-promotion trap. Else, the brand is
likely to get into the evoked set only when there is a sales promotion announced.
New brands can use intercept strategy by getting consumer attention through
strong positioning strategy, even in a limited CDM situation. Aquafresh's tooth-
brush positioned itself strongly on attributes or benefits; Promise toothbrush
positioned itself on its angled design and Tropicana positioned itself on health
premises as “pure juice” – these are examples of intercept strategy. Another inter-
cept strategy can be to reposition competition (though sometimes there is a risk
of using positioning against established beliefs). Savlon, the antiseptic brand,
repositioned its competitor Dettol by positioning itself as an odour-free brand
sans the sting when applied on cuts. Adding new benefits in a competitive situ-
ation can also be an intercept strategy. Fair Glow, a fairness soap launched by
Godrej, combines the benefits of soap and fairness cream. Intercept strategies
can work even in commodities. A brand free-flowing of salt or a brand of wheat
flour offerings are examples. Intercept strategy can be useful for new brands to
establish themselves in a given category.
(e) Preference Strategy

As CDM involves extensive information collection, there are the situational
possibilities that can make use of this strategy:
1. When the intention to buy the brand is high (as it is already in the evoked
set of brands)
2. When the consumer has already bought the brand and wants to consider
replacement of the product.
There is evidence to show that the intention to buy may not be a strong indi-
cator of the final purchase, though a number of studies in India are conducted
in this dimension. However, intention to buy indicates brand awareness and
even a preference for one. The gap between the intention to buy and the actual
purchase can be traced to the point of purchase or retail outlet (especially for
durables). The retailer's recommendation carries weight in the Indian context.
A brand should ensure that the retailer commends a brand only if it fits into
the “need structure” of the consumer. This is in the interest of both the brand
and the retailer. Retailers have to be trained in this aspect.
A durable national brand may have around 5,000 to 6,000 retail outlets in
which it is offered and a majority of these are likely to be multi-brand outlets.
It is essential for a brand to ensure that the retailer recommends an offering as
per the needs of the consumer and the one that may be updated in terms of fea-
tures. A consumer desiring a “no-frills” TV will develop dissonance towards
the brand and the retailer if he/she is pressurised into buying an expensive TV.
The preference strategy should ensure that the brand is viewed positively even
after it is bought. Another possibility of a change in the intention to buy may
be due to the word of mouth (on a competitive brand) obtained from a per-
sonal source. A marketer may not be able to counter this directly but it is useful
to have primary research on the decision making process of consumers who
have already bought a specific brand. Researching can be sourced from past
information on how the consumer knew about the brand he/she purchased,
the various brands that were considered, the gap (if any) between intention to
buy and the final purchase and the various personal sources he/she used for
information search. This research can enable a marketer to get inputs for pref-
erence strategies.
Preference strategy may also be associated with the existing brand the con-
sumer is using at a point in time. Companies like BPL, Videocon or Whirlpool
may want to know how the preference strategy can be a part of the cus-
tomer-relationship program. These are brands that exist in several categories.
A brand, which a customer had bought (in any category), goes beyond the
evoked set of brands and creates an “experience” for the customer. The relation-
ship phase based on the experience determines not only the evoked set of brands when
the customer wants to replace the product but also when he/she desires to buy a differ-
ent product category in which the brand competes actively. Right from installation
or giving information on product usage (by sales personnel or a brochure) to
the stage of reminding the customer about the replacement of the product at an
appropriate time, a brand (and, hence, the company) can work out a number of
dimensions associated with the preference strategy. This is a powerful strategy
for customer retention. There are several brands (in durable categories) offer-
ing exchange promotion for the replacement market. There does not seem to be
a single brand that offers privileges for a consumer who has bought the same
brand in his previous purchase cycle. The frequent flyer program offered by
airlines in an example of the preference strategy being used to retain consumers.
(f ) Acceptance Strategy
While the preference strategy tries to capitalise on the positive impact of
the brand on the consumer, acceptance strategy attempts to create an accept-
ance for a brand, which is not in the evoked set of brands when the consumer
is about to begin the process of decision making. This becomes all the more
difficult because of the strong and well-entrenched brands that are already
in the evoked set of consumers. A strong brand name (with “value” percep-
tion) can be a good acceptance strategy to get into the evoked set. Akai cre-
ated a value-oriented exchange program when it entered the Indian TV mar-
ket. Indian experience in durables shows that value is as important as or even
more important than the brand name. LG and Samsung (Whirlpool's strategy
was discussed earlier) are examples of acceptance strategy successfully cre-
ated by marketers through useful features. Santro's strategy (discussed earlier)
is also an effective acceptance strategy. An acceptance strategy should ensure
that consumers visit the retail outlet to know about the features and benefits
of a brand. Automobiles and two-wheelers can advertise trial runs. Ceilo, the
car brand, even came out with an extended trial-period scheme in an effort to
motivate consumers to consider the brand in the evoked set. Long-term adver-
tising, with an emphasis on attracting attention (resulting in incidental learn-
ing among the prospective consumers), is another type of acceptance strategy.
The objective of such a campaign is to get the brand into the evoked set of
consumers.
The different kinds of strategies suggested across the CDM types are
suggestive and a number of variations are possible with the marketing mix
elements. The framework only attempts to provide a structured perspective

on CDM.
Dimensions of Information Search

Information search can be explained in terms of degree, direction and se-
quence. The degree of search represents the total search. This is associated
with the number of brands, stores, attributes and other information sources
considered during the search process. Category killer like Vivek & Co. or Kids
Kemp (the former for consumer durables and the latter for apparel) carry a
number of brands and it becomes easy for consumers to compare brands or
attributes. Consumers may not visit many stores for the purpose of compari-
son. Direction represents the specific context of search. The focus in this kind
of search may be specific brands or stores. The sequence is the order in which
search activities take place.
The degree of search is significantly dependent on the decision making
process. Extended decision making will involve considerable information
search. In the case of durables, if the consumer is satisfied with the purchase,
he/she may minimise the search time by considering the same brand during
the replacement cycle. Consumers can be segmented based on the degree of
information search (based on primary research) and grouped into a number
of categories (suggestive)—low-search group, purchase-friend assisted group
(assisted by a known person), high-search group or a moderate search group.
A manufacturer of a durable like a TV or a refrigerator may find that consum-
ers in the high-search group are more likely to buy the brand than others. The
brand can come out with advertisements which may encourage consumers to
search for information. This is more applicable to durables, brands that offer
new features to maintain a competitive edge. (Golden eye in LG TVs and flex-
igerators from Whirlpool are examples.) Consumer segments that engage in a
considerable amount of external search may be easier to reach than those that
rely on internal search. Consumers who rely on internal search may be ap-
proached through direct marketing.
Marketers may be interested in the direction of search for a variety of rea-
sons. They may want to know what kinds of product attributes attract consum-
ers or the price range in which consumers are interested. Distribution decisions
may be fine-tuned based on the type of retail outlets and specific geographic
locations that consumers visit. A brand may find that a specific store in a geo-
graphical area enjoys a lot of consumer loyalty. The company may not appoint
additional retailers in that area. In consumables like FMCGs or house ware, in-
store information or point-of-purchase material may play an influential role in
CDM. There is growing evidence to show that in some categories, buyers make
their decisions using in-store information. Electronic information kiosks may
be useful in large stores if consumers need information about specific brands,
sales promotions or about the ingredients of brands. This may be applicable
more in supermarkets that attract a large number of consumers. The search
dimension is concerned with the order of search activities. Consumers may
be involved in brand search sequence (processing by brand), in which each

brand is examined along various attributes or they may be interested in attri-
bute search sequence (in which brand information is collected on an attribute-
by-attribute basis). For example, a consumer may process by price, warranty
and features, in that order. A brand confident of emphasising its superiority
over competitive brands if consumers begin comparing brands and attributes
can use comparative advertising. This advertising is becoming common in
the automobile product category (Santro, Indica and WagonR are examples).
Marketers may also be interested in finding out the sequence in which infor-
mation sources are used by consumers. The consumers, for example, depend
on TV for awareness, newspapers for specific details and word of mouth for a
final endorsement by a source, which they consider credible. It may be worth-
while for marketers to prioritise the dimensions of information search.
Importance of In-store Research (FMCG products)

 Do consumers compare prices when they buy commodities/essentials?
 What is the time spent by consumers in reading in-store promotional
material?
 How many consumers check if a price deal is available at the store in the
product category they are about to purchase?
 Do consumers read the labels of the brands they select (especially, if they
make a brand switch)?
 Do consumers spend time on brands placed at the entry point of the
store?
 How many consumers buy products based on advertising/word of
mouth when they make a brand switch? How many change their decision
based on POP material?
 Do children influence consumers at the retail outlet?
 Do consumers change their decisions when cooperative sales promotion
is involved? (One brand from a category given free with another in a dif-
ferent category, for example, a Dettol soap given free with Lizol?)
These questions are likely to be useful specifically for a large retail outlet
dealing with FMCG products in an urban context (like Food World).
CDM—An Overall Perspective

The CDM model can be used in conjunction with its own interaction with
individual processes, environment and marketing mix elements. Applying
CDM along with several situational factors (in a specific product-market
situation) can enable marketers to fine-tune one or several marketing mix
variables and also appreciate the dynamic nature of CDM in a changing

environment. Overall, CDM, viewed with primary information, can help a
brand/product manager to analyse several alternatives in terms of formulat-
ing strategies. For instance, there are several brands in the category of tea and
there is a need to change the strategies according to the changing environ-
ment. Consumers may select different brands of tea for different occasions––
some may even alternate between loose and branded tea at the lower end of
the market. Companies have been attempting to upgrade consumers even as
there has been a decline in the overall consumption of tea. The beverage may
also be competing with coffee and soft drinks. The challenge, especially for
a company with several offerings (HLL or Tata tea) in the category, is to en-
sure there is overall growth in the company's market share. There may also
be a need to expand the market. HLL, for example, has introduced Lipton's
iced lemon tea. Of course, such an attempt is fraught with many challenges.
Should such a brand position itself on growth? It may be difficult to change
the habits of elderly consumers who have been drinking tea for decades. The
younger segment may like iced tea between their cola breaks. What kind of
communication should be developed for the brand, especially if a lifestyle
positioning is attempted (it should not get lost in the lifestyle positioning
associated with soft drinks) with an eye on long-term sustainable core prop-
osition of the brand. Should the appeal be inner-directed or other-directed?
How should the distribution channel for the brand be planned? The brand
may be offered through fountains (at a lower cost per cup) so that a trial can
be initiated, or it may be introduced through tetra packs. Should it be intro-
duced through stock-keeping units (SKUs)? The brand may have to choose
a specific occasion to position in order to ensure a place in the mind of the
target segment.
As can be observed from the example, the marketing strategy for any
product-line (with several variants) is a continuous process and the model
given above may be useful for marketers to incorporate changes in the mar-
keting mix elements over a period of time. (see Figure 3.8)
The model offers the following inputs:
 What aspect of the marketing mix elements should be changed/modified
at a specific point in time? (Planning this will also help an organisation to
initiate product management initiatives.)
 How should the changes with regard to a brand be viewed with the other
brands marketed by the company? (Brand equity in terms of what it stands
for and cannibalisations are important aspects associated with this input.)
 How can CDM be influenced by competitive offerings/strategies?
 What aspect of the individual (psychological) is most suitable for formu-
lating/modifying the communication associated with the brand?
(In the example discussed, should the brand of iced tea shift to creating an
attitude after creating basic awareness about the new product?)
Target Segment
Stages in CDM Brand’s

MMix
Individual Strategies
Process
Perception
Attitude Other Brands of
Personality Competition the Company
Learning
Figure 3.8  CDM–An Overall Perspective
The soap market, in recent times, has posed many challenges for market-
ers. Research studies also indicate that consumers in this category down-trade
or switch to an offering priced below the one they are using. Lux is an inter-
national brand and HLL, in India, has Lux Beauty Bar, Lux International and
Lux Sunscreen variants. Lux Beauty Bar is in the popular segment and has al-
ways been differentiated through its packaging and fragrance. The brand also
has a strong brand property (celebrity association for the last several decades).
Based on research, HLL has attempted to strengthen brand differentiation
by using new ingredients like honey, milk and almond oil. Product-oriented
image enhancement ensures
1. that the brand does not engage in a price war that may dilute its
equity;
2. a reversal in the pattern of down-trading by offering a superior prod-
uct. As the growth is in the sub-popular segment, the company hopes
to upgrade a section of consumers in that segment to Lux based on
superior product attributes. This is yet another example, which empha-
sises the dynamic nature of the CDM process with its environmental
linkages.
Consumers, Shopping Styles and Brands

Shopping is an activity which people, by and large, look forward to. It is, there-
fore, worthwhile to analyse the impact it has on their decision making. The an-
alysis will also provide marketers an insight into how consumers select brands
within a product category (from soaps and shampoos to televisions and refrig-
erators). The article also indicates the scope for consumer research on different
styles across categories.
Box 3.1
Cognitive Dissonance and CDM
There is a distinct possibility that a consumer in India thinks about a
competitive brand after he/she has purchased another brand with due
deliberation. This happens when there are a number of brands in a prod-
uct category, and most of them have a number of features in the same
price range. This post-purchase indecision or thought is called cognitive
dissonance that the consumer experiences when he/she feels that the un-
selected alternative (brand) may have been a better choice. This aspect
of CDM cognitive dissonance is the perceived inconsistency between the
decision making process and the final choice made after the sale is over.
This can happen only when the unit price of the product is high or there
are many brands for the consumer to compare before deciding on one,
or when information search has been rather extended. There may be an
element of self-esteem involved as well in products like home furniture,
which reflect a certain lifestyle. In the aftermath of dissonance, the con-
sumer obtains more information about the selected brand, changes the
attitude towards the brand or rationalises his/her decision of having
bought the brand. When a brand of refrigerator advertises saying “If you
have bought a refrigerator other than …….. brand, our condolences”, the
attempt is to trigger off cognitive dissonance. Automobile companies in
developed markets, which are highly competitive, create exclusive ad-
vertisements for their buyers reassuring them with slogans like “What a
feeling!” or emphasising that they have, indeed, made the right choice.
Improper information/assistance on product usage can cause disson-
ance. Good warranty policies may also be useful in preventing cognitive
dissonance. A company can also face dissonance when it introduces an
updated version of its product (in terms of value) soon after its consum-
ers have bought the earlier version. On the other hand, a competitive
situation may require the company to introduce such versions. To have
a value-based exchange program for such consumers is a solution apart
from ensuring that improved versions are timed well.
In the case of consumer durables, the handling of cognitive dissonance

can be on the lines of addressing these queries:
 Is there dissonance?
 It is real or perceived?
 (Is it due to product problem?)
The strategies for coping with these issues may be product improve-
ments, communication, warranty policies, after-sales service and avoid-
ing “product puffery” (exaggeration of the product) in advertising.
Emergence of Shopping Styles

A few decades ago, such an article may not have been applicable to the Indian
context. As markets grew and brands proliferated with a variety of proposi-
tions and positioning strategies, shopping styles began emerging, at least in the
urban context. Consumers have also developed lifestyle, which has emerged
from changing attitudes and mind sets; exposure to western influences and a
need for self-gratification. Beauty parlours in cities, eateries, time-share vaca-
tions, designer wear, watches and even soft drinks are a few instances that
reflect these changes. The sellers' market is slowly moving towards becoming
the buyers' market, though not in the same manner as in the developed world,
with a slew of variants among products and offerings. Soaps, shampoos, air-
conditioners, televisions and washing machines, with their many features, are
available aplenty. As the point of brands reaches “commoditisation” in sev-
eral categories (where differentiation may be getting narrowed down), com-
panies are endeavouring to highlight value in their offerings. (Value, in simple
terms, is the enhancement of the price-performance equation or “more for the
same price” approach) “Value”, by itself, has triggered off a shopping style
even in the premium product categories. A 29-inch TV was, at one time, in
the premium category. The growth can be largely attributed to Akai, which
brought in a value-based exchange scheme. Value has also reflected in “price
bundling”. Akai introduced a scheme that had TV and refrigerator built into
the same price in such a way that it resulted in a positive bargain for the con-
sumer. Lizol, a brand of floor-cleaner, offered a value-based promotion of giv-
ing Harpic free with every bottle of Lizol. (Both products come from the same
company.)
Shopping Style
Quality-oriented Style Consumers, here, look for quality in brands
when shopping. They may choose expensive brands as they feel that price
is an indicator of quality. In the absence of well-known brands in a product
category, these consumers are likely to take cues from retail outlets (Food
World or Nilgiris) hoping that these outlets will carry quality products.
Small or regional brands, which cannot afford high-visibility campaigns,
have an opportunity to get into the “consideration set” of consumers by
constantly supplying good quality products to these retail outlets. This they
can do by conveying the brand name on the packaging. Vegetables, fruits,
commodities and snacks are product categories that offer scope for such
strategies. It is also imperative for brands to maintain quality (especially
for FMCG brands like tea, coffee and soaps) to ensure that quality-oriented
customers remain with them. These customers may also try out brands
within a specific price range. A user of the Dove moisturising bar may buy
Mysore Sandal Gold, which is a soap in the same price rage. In the case of
durables, quality-conscious consumers may obtain references from friends
on performance and after-sales service. They may also look for specific fea-
tures that they are interested in. Automatic cut-off in gas stoves may be a
feature that appeals to some consumers. It should be remembered that qual-
ity, for this category, does not mean only performance but also convenience
and comfort. These consumers are normally price-insensitive if “quality”
products enhance the “quality” of comfort and well-being. The “feature”
oriented “quality” consumer may form a profitable niche for marketers. The
LG brand that offers preservation of nutrients in its refrigerator and micro-
wave is an example.
Brand-conscious Style Consumers, in this category, are brand conscious

because of the prestige associated with these brands. They may be drawn to-
wards brands that have lifestyle appeals, in addition to promises on quality. A
brand-conscious shopper will be found more in categories like two-wheelers,
cars, televisions, textiles and watches where the brand is likely to reflect the
social status of the buyer. Brands can also be built in impulsive product cat-
egories like soft drinks and chocolates through which the consumer would
like to identify himself/herself in a social setting. Brands, like Pepsi, that carry
group appeals may have an impact on this consumer type.
Another kind of brand appeal that may draw these consumers in is the ex-
tent to which they internalise it. Apart from projecting the social status through
the ownership of certain brands, consumers may also identify themselves in-
ternally with these brands. Brands make use of brand personality techniques,
which are very useful.
The freshness associated with Liril appealed to housewives who wanted a
break from their routine. Raymond's “complete man” will appeal to consum-
ers who perceive themselves to be down to earth, if not ideal, guys.
Novelty-oriented Style A small section of consumers may want to try

and experiment with new products, new variants of existing product/brands
and new brands. This shopping style may be found in almost any category
where a number of brands compete with each other. The soap category may
be fickle and one in which there are frequent brand launches. This style is also
relevant to electronic products—a category with consumers who may like to
try out the product/brand as soon as it is launched. Companies will benefit if
they have a database of these innovators (depending on the product category)
so that direct marketing may supplement other marketing mix strategies. This
consumer-type may either be drawn towards the novelty of the product or
derive internal gratification of being an opinion leader by trying out the new
brand/product. An opinion leader in one category may not be so in another
category. It may also be worthwhile for a marketer to research the market for
novelty products (or products offering a number of features) to be sure of the
availability of this niche. Decades ago, a novel product – record-player, tran-
sistor and tape-recorder combined – failed to take off. Similarly, the picture-in-
picture televisions have also not taken off.
Shopping as a Fun/Pleasure-oriented Activity There may be shop-

pers who regard shopping as a fun-oriented pleasurable activity. Retail am-
bience, layout and in-store music may be factors that keep these consumers
longer in retail outlets. While it may be possible to create brand awareness in
such consumers in the case of durables, consumable product marketers can
gain directly through this kind of shopping activity. Research shows that the
right type of music (depending on the consumer type) makes consumers stay
longer and spend more in the outlet. There is another implication of this shop-
ping style. Consumers should be encouraged to stay longer in the retail outlet
without being pressurised into buying things. This increases the store traffic
and results in better volumes. Kids Kemp at Bangalore is a good example of
how consumers are encouraged to stay on in the outlet. Fountainhead and
Landmark book stores also encourage prospective shoppers to spend more
time at their outlets.
Shoppers' Stop advertises and positions itself on the space and ambience
created for a shopping experience. It came out with a television commercial
saying shoppers can shop at a snail's pace.
Shopping as a recreational activity may be acceptable as a shopping style.
Carried to the extreme, this shopping style may result in a compulsive be-
haviour called “shopaholism”. Shopaholics buy excessive products and brands
to merely indulge themselves and serious cases may require medical atten-
tion. Incidentally, psychiatrists in the US have come up with a treatment for
shopaholic behaviour. The major symptom in a shopaholic is that he/she feels
guilty after the initial thrill of shopping is over.
Value for Money Style This style attempts to focus on the best bargain—
not just the price but enhanced price–performance equation. A consumer with
this orientation may gather information about several brands and retail outlets
before finalising the purchase of a brand. He/she may compare prices, features
and promotional offers and employ extensive decision making before clinch-
ing a deal. This consumer is different from the quality-oriented consumer in
that he/she is concerned about the total offering (or total product experience)
than just the quality. Bajaj has a value perception based on its initial cost, costs
of maintenance, ease of reparability, resale value, service centre backup and
ruggedness of the vehicle.
“Impulsive” Style Unlike the shopaholic, this consumer buys without

much analysis or information. The impulsiveness mentioned in this context is
not the impulsiveness associated with most consumers when they buy things
on impulse. The impulsive buyer is in a hurry to finish off his/her shopping
(occasional hurry is not considered here) without much planning even while
buying expensive and risk-oriented durables. This consumer does not seem to
get involved in the learning process associated with buying or decision making.
Well-known brands can reassure this kind of consumer through a distinctive
advertising campaign. For example, a hi-tech brand like Philips introducing a

new version of a product can bring back its signature line it used a decade back
“If it’s Philips, you are sure”.
Companies can also interact with retailers to ensure they do not take ad-
vantage of the impulsive nature of consumers in attempting to offer them
products or features they may not need. An impulsive consumer may experi-
ence dissonance when he/she finds that the retailer has sold something that
he/she does not require. This aspect of matching the offering with the needs
is especially important to sustain and nurture a good brand image. Impulsive
consumers can bad mouth a brand if dissatisfied.
Shopping Style under Information-overload In crowded categories

like electronic and entertainment equipment (generally durables) or cars, the
number of claims and counter-claims made by brands can confuse a consumer.
The confusion arises out of the fact that consumers don't understand the tech-
nological terms well. Besides, they may feel that they are losing out on cer-
tain features for the money they are paying (though they may not use all the
features) if they decide on a specific brand. The retailing aspects are of vital
importance in this situation, be it concept-selling for a new type of water puri-
fier or detailing the features of a new model. These consumers are likely to
stop in multi-brand outlets and, hence, the retailer should make a planned
effort to enable comparisons across brands (on technological claims, service,
warranty, etc) so that the consumer will have a clear idea about his buying
decisions.
Loyalty Style of Shopping The ultimate shopper, for any marketer, will
be a committed loyalist who selects and reselects the brand out of conviction
and involvement with the brand. The consumer may even stick to the brand
across product categories brought over a period of time. BPL has a host of cat-
egories and a buyer of a transistor may be a perspective buyer of several cat-
egories. Direct marketing, systematic creation of a database of loyal consumers
and attractive schemes for these consumers are some strategies that will yield
long-term gains for the marketer.
The shopping style would indicate different mindsets of diverse consum-
ers. It should be noted that consumers cannot be branded on these styles.
These styles may vary across product categories even for the same consumer
in different situations. Analysing shopping styles will enable marketers to en-
hance the marketing mix strategies of their brands.
Touch of Reality
Differentiating Involvement Levels
Involvement is the degree of personal interest in a given product/service
and it can vary from one consumer to another. A consumer who is rated
on the list “Country's Richest” may look upon collectors' cars as an im-
pulsive buy, based on his involvement in cars. A daily wage worker
may occasionally buy a expensive soap to reflect his/her involvement
with soaps. Most consumers may be highly involved in personal groom-
ing and may choose their cosmetics and beauty parlor with great care.
However, typical high involvement situations are triggered by one or
more of the following aspects:
 Change in the consumer life-cycle – MBA students passing out of the
institute to take up corporate jobs.
 Replacement of durable products or buying it (an expensive prod-
uct/service – like a car or an apartment) for the first time.
 Exposure to new products that are of interest either for functional
utility or symbolic value (prestige/emotional connections) – like the
excitement created by iPhone when it was launched
Low involvement levels are found with typical fast moving goods like
soaps, tea, coffee and similar products bought frequently (there may also
be a cross section of consumers who are involved with these categories
due to their hedonic preferences.
Information search, evaluation, investment of time and effort, and
need recognition are some of the factors that differentiate low involve-
ment from high involvement situations.
Degrees of Information Search

Information search of consumers depends on a number of factors con-
cerning the environment as well as the consumer. Given the escalating
costs of petrol in the recent times, vehicles running on alternative fuel,
is likely to receive a lot of attention in the times to come. A consumer
wanting to buy a two-wheeler for city transport more from the utility /
functionality viewpoint (rather than for symbolic/purposes) would want
to find out information on electric two–wheelers that are in the market.
The consumer may not be familiar with the category and may not have
sufficient knowledge about this category of vehicles. Lack of familiarity
and knowledge makes the search time consuming and demanding. The
time frame by which the consumer wants to decide on the two-wheeler

is another factor. Perceived risk (functional and financial) involved in
the new type of two-wheeler as compared to conventional and accepted
types that run on petrol is another factor affecting information search.
The consumer is likely to look for “word of mouth” references on the
vehicle and after sale service from the buyers of this new sub category.
A consumer who has little time to decide or is unable to get informa-
tion that addresses his/her perceived risks may quickly decide to opt
for the conventional two-wheeler. The shopping style of the consumer
is another factor. A bargain oriented shopper may weigh the lifetime
maintenance costs of the new type of electric vehicle with a comparable
type of the conventional vehicle. A consumer who also wants to convey
a symbolic meaning with his/her possession may opt for an appropri-
ate vehicle ignoring the new type of vehicle after collecting some basic
information on it. A consumer who believes in brand-based processing
of information may leave out the new type of vehicle as it does not fit
in with the consumer's “set of brands.” However, a consumer who is
not in a hurry to buy the vehicle but interested in the new type of two-
wheeler may wait and discuss the vehicle with an early set of buyers
(set of “innovators” who buy the vehicle) over a period of time to obtain
more information about the vehicle.
4
The Concept of Perception

and Its Impact on
Marketing Strategies
Sony, Raymond, Mercedes are familiar brand names that spark off associa-
tions (brand images) based on past encounters consumers may have had with
these brands. These encounters may be purchase associations or the exposure
consumers may have had through advertising. As in several aspects of life, it
is the perception that matters in a marketing context in which brand names
and company names trigger associations and images. Perception is unique to
each individual and it is not just objective reality. Different individuals may
have their own version of brand description or associations based on their
perception. Rolex, an up-market global brand, may be viewed by some con-
sumers as a brand that reinforces their personality by reflecting a prestige
appeal. It may also be viewed by some as an expensive brand but a wasteful
indulgence.
A stimulus (“stimuli” is used when more than one stimulus is referred to) is
an information input to any of the senses. One smells, hears, sees, touches and
feels because of stimuli sensed by the respective sensory organ. The imme-
diate or spontaneous and direct or “head on” response of the individual to a
stimulus is sensation. The minimum level at which an individual experiences
sensation is the absolute threshold for him/her. Two persons travelling on a
highway may notice a billboard advertisement from a different distance and
may differ in their absolute threshold.
Applications of Sensation
Marketers constantly attempt to get through the “sensory adaptation” of con-
sumers. Consumers get used to the clutter of advertisements in the media and
may fail to notice advertisements unless they stand out and attract attention.
A creative advertisement will attract consumers' attention. Attention is a

prerequisite for perception to occur because it is through attention that stimu-
lus is generated for sensation. There are several strategies marketers use to
gain consumer attention. 7up soft drink used cartoon animation when a num-
ber of soft drink brands were using models in their advertisements. Itch guard
(a brand that offered solution for itches) used humour in its advertisement.
Polo used an unusual theme for its advertisement (TV commercial). Impul-
sive products like confectionery rely on fun themes and Polo used a “student-
professor” fun theme. Bingo also used a fun theme showing humorous visuals
when the brand is tested under “normal” and “extreme conditions”. Creativ-
ity that is relevant to the brand is required in an advertisement to ensure con-
sumers' attention towards the brand. A direct marketing company selling up-
market durables may send a CD with product information to select prospects
instead of spending indiscriminately on advertising. The consumer is likely
to load the CD on the computer and go through the brand information rather
than read through a half-page newspaper advertisement. The context for such
strategies should be taken into consideration.
Another interesting application of sensation is the ability of individuals
to differentiate between two stimuli. This can be best illustrated through an
example. A company manufacturing chocolates may add to the quantity con-
tained in each unit of chocolate without increasing the price. If the present
weight of the chocolate is 20 gram, there is a need to ascertain from consum-
ers what additional quantity would be perceived as more (the options may be
22, 24 or 25 gm). The marketer in this situation (particularly in a competitive
situation) has to consider:
1. the quantity at which consumers will perceive the brand as offering more
chocolate—the point at which consumers will perceive the difference be-
tween the earlier version of the brand and the new version.
2. the need to ensure that more chocolate is not offered beyond the differen-
tial threshold as this will cause a dent into the profitability per unit and
also cut into repeat purchases.
Marketing research information obtained with “just noticeable difference”

(JND) as the focus will enable the marketer to add just that quantity required
to create the perception that extra quantity has been added in the new version
of the chocolate. Cadbury's chocolate introduced its re-launched version dur-
ing the eighties as “Dairy Milk” to highlight the changes made in the offering.
This enabled the brand to create a perception about the enhanced offering to
the consumer. Positive changes in the brand may have to be highlighted to
make use of the JND concept.
 A number of shampoo brands offered 10 ml sachets at Re 1 when sachets

were introduced in India. Over a period the price points have been in-
creased by a number of brands while decreasing the quantity in the sa-
chets to 8 or over 6 ml. It may be difficult for the consumer to notice the
4  The Concept of Perception and Its Impact on Marketing Strategies 115
Box 4.1
Perception Matters
During the nineties two companies, Chrysler, which had around 10 percent
market share and Mitsubishi, which had 1–5 percent market share intro-
duced identical sports cars (in the range of US $ 11,000–18,000). Both cars
were positioned for educated women consumers in the age group of 25–35
years. Chrysler’s car was Laser and Mitsubishi’s Eclipse. Laser was ad-
vertised in car magazines and Eclipse sponsored contests in health clubs
frequented by the target segment. Laser’s advertisements concentrated on
horsepower and speed. Mitsubishi, with 500 dealers, sold 50,000 cars and
Chrysler with 3,000 dealers sold 40,000 cars during a specific period.
Eclipse, from a Japanese company, was perceived as unique, rare and
of superior quality. In contrast, consumers viewed Chrysler as low in
quality, unreliable and meant for older consumers. Laser’s sporty image
was inconsistent with the perception of consumers about Chrysler. The
company also did not make efforts to change the consumer perception.
Perception matters because categorization is the process of understand-
ing something (could be an object or a category or any thing that is new
to the consumer) by relating to prior knowledge.
When Raymond did not succeed with its two readymade brands
Double Bull and Legwear it introduced Park Avenue. Park Avenue has
a strong American association and during the times when ready-mades
were perceived as something of foreign origin, consumers may have had
favorable linkages between the brand name and its offerings. Park Av-
enue is now a successful brand. Consumers in the target segment came to
associate the brand name with things American, and the brand has been
growing ever since.
difference from the packaging unless one specifically looks for the quan-
tity label on the package.
 When coffee prices increased during the mid-nineties, marketers may
have wanted to bring down the quality (taste) of coffee by using the right
mix of chicory to the point where consumers do not perceive the change.
The Concept of Perception

In simple terms, perception is the meaning an individual adds or subtracts to
the information he/she receives through the sensory organs. The incoming
stimuli interact with the stored information (memory) to give rise to percep-
tion. Figure 4.1 illustrates the mechanism of perception.
Stored information Object perception
Pepsi Mind
Cola Trendy
Advertisement Young generation
(stimuli)
Figure 4.1  Mechanism of Perception
A Pepsi commercial telecast during a cricket match may be a stimulus.

The stimulus interacts with the information already stored in the mind of
a consumer. This information may be associated with cola advertising, spe-
cific brands in the aerated soft drink category or the associations that have
been added to the brands in the cola category. (These aspects are covered
in the Chapter 5 on Learning Principles). The individual is able to spon-
taneously associate Pepsi with cola, or a trendy, young generation. A dis-
tinctive brand meaning is triggered in the mind of consumers. This can be
extended to create a brand personality (dealt with later in the Chapter 6 on
Motivation). Any competitive brand has to develop unique associations that
originate from perception. The concept of positioning has its foundations in
perception.
Dynamics of Perception
Perception consists of several elements and involves selection, organisation
and interpretation of stimuli. All these elements offer useful points to market-
ers regarding the formulation of communication strategies.
Selection of stimulus, as stated earlier, depends on attention that can be
brought into communication through contrast. Jenson & Nicolson, the paint
brand, used full page magazine advertisements with only a few lines of copy
to enhance the contrast in magazines cluttered with advertisements. Levi's
used black and white advertisements in magazines full of colour advertise-
ments to highlight the contrast.
Lack of contrast can also be used to attract attention. Advertorials (adver-
tisements on the lines of editorial, write-ups), can be placed close to magazine
articles in such a way that consumers get into such advertisements immedi-
ately after reading the article. Reader's Digest carries such advertorials. Bru
coffee, when it was launched identified itself as a drink that is close to the
South Indian filter coffee through its advertisements. A branded curd (curd is
used as a household item in several households) should taste as close as pos-
sible to that made at home.
Selection of a stimulus is also based on a consumer's motivation regard-
ing a specific product category. A consumer interested in buying a television
(selective attention) is likely to be attuned to advertisements of television

brands. Selection is also based on an individual's expectations. Some brands
use unexpected visuals/audio effects in advertisements to attract attention.
But such elements should take into consideration the match they have with
the category and the benefits a brand offers. For example, a brand like Sony
that offers innovative and high-quality features with regard to its products
may start the advertisement saying, “Sony is expensive”, followed by copy
which substantiates the claim. This is likely to attract attention as consumers,
used to freebies and low-prices claims, suddenly encounter a contrary and
unexpected element in the advertisement. Bacardi, the liquor brand, attracted
attention through its unexpected visual and jingle when such advertisements
were allowed on television (the example is used for illustrative purposes to
convey the concept though liquor advertisements, on TV channels, are no
longer telecast)
The organization of stimuli involves figure and ground, grouping and clos-
ure. All these concepts offer insights into how an advertisement may have an
impact on consumer perception. The figure in any advertisement is well de-
fined, concrete and upfront. The ground is hazy and continuous. In an adver-
tisement, the figure should always be the brand name and the unique selling
proposition (USP) of the brand. The jingle, humour or creativity should also
be the ground and should not affect the figure negatively. Ericcson's adver-
tisement for its cellular phones is a good example to illustrate the point. The
brand used humour in its “Black coffee please” commercial and it became a
noted advertisement. A study by the author conducted among the prospects
revealed that though the advertisement was recalled well by the respondents,
they associated the advertisement with another brand which, incidentally, had
launched a press campaign. The press campaign was in operation while Er-
iccson brand was being advertised on TV. Such an observation reveals that it
is not only important to attract attention through advertisements: it is more
important to ensure that they have the appropriate figure and ground ele-
ments. This is especially important when creativity is used in any category of
advertisements.
Grouping enables marketers to create associations by grouping stimuli in
such a way that brand associations are developed when consumers associate
sets of stimuli. Force 10 brand of shoes from Liberty used this technique to
project Force 10 as a lifestyle brand. The brand was grouped with burgers,
jeans, cola and goggles. Titan's Fastrack watch was associated with a can of
soft-drink implying a trendy, young and westernized, lifestyle. The brand is
positioned towards the youth who lead a western lifestyle. Charms, one of the
earliest Indian brands associated with “youth's attitude”, grouped the brand
with the jeans fabric to appeal the package to urban youth. Grouping is exten-
sively used to shape the perception of brands.
The concept of closure is associated with an incomplete stimulus. Individu-
als express the need for closure by organising their perception to form a com-
plete picture. If they are exposed to an incomplete stimulus, they will make an
effort to complete it. A circle with a small portion of its periphery missing will
be perceived as a circle. When an individual is exposed to an incomplete stim-

ulus, there is a build-up of tension, which motivates him/her to complete the
picture. Closure leads to a very interesting application in marketing. A brand
may use the audio track of a TV commercial through the radio (especially since
FM channels are catching up) to create an incomplete perception of the TV
commercial. This is to induce the consumer to complete the perception by re-
calling the visual associated with the jingle.
Yet another associated application is the development of unique “brand ele-
ments” that have a long-term impact on the brand association. This association
based on the property of the brand (achieved usually by repeated advertising
and sustained association) serves as a differentiator, thus enabling the brand
to maintain a unique image in the category. Titan's Mozart score (jingle) and
“Give me red” associated with Eveready batteries are unique brand elements.
These are extremely effective in a low-involvement category like batteries. The
“red” (power association) combined with the “youth” image appealed to the
younger generation, particularly at a time when Walkman, cameras and cellu-
lar phones were catching up in the urban markets. Kellogg's, in certain mar-
kets, uses hoardings that do not spell the brand name completely and forces
the viewer to mentally experience closure. Each time this happens, it has a
cumulative impact on the consumer.
Perceptual interpretation, unique to the individual as adding meaning
to what has been sensed, is based on the individual's experience. Market-
ers have to be careful when they choose brand names for their product
categories. The past image in the memory should not create an unfavour-
able interpretation. A snow-thrower named Snow Pup was unsuccessful
because consumers associated the brand name (stimulus) with a toy. The
company changed the brand name to Toro and the product became a suc-
cess. Product design may also influence interpretation of the stimulus (pic-
ture of the product). Chrysler designed and advertised one of its models as
“mini-vans” and sold similar offerings from competitors during a specific
period. In the Indian context, Hero Honda Street (two-wheeler) had sev-
eral city-friendly features. But the design probably reminded the consum-
ers of the M-80 mopeds that were popular in several urban areas during the
eighties. Further, there was a price difference between the two offerings.
Street was introduced at the upper end of the then two-wheeler market,
while M-80 was associated with the lower segment. Perhaps the design of
Street could have been different from that of M 80. Lever Brothers intro-
duced Sunlight dish-washing liquid in the US decades ago. The company
found, to its shock, that a cross-section of consumers used the product as
a tea additive, because the packaging had a photograph of lime printed on
it. Consumers who were used to lemon tea thought the product could be
used with tea.
Categorization is also an extended concept associated with the interpret-
ation of stimuli. Consumers tend to associate a stimulus with a group of
stimuli they are familiar with. For example, when microwave ovens were
introduced consumers may have associated them with kitchen appliances
before the product concept became familiar to them. Marketers should be

careful in product design, advertising and branding to avoid unfavourable
categorization in the mind of the consumer. 7-up re-launched itself as an
“Uncola” drink in the US and opened up a new category in the psyche of
consumers. Branding jewellery as Mystic Gold and advertising it with a ce-
lebrity endorsement may make consumers think of it as an expensive brand
even if the price is not explicitly stated. Advertising a beer brand as LITE
may give the impression that it is “light in calories” even when it is not
explicitly stated. Positioning strategies should take into consideration the
interpretation of the copy and the visual of advertisements. If Raymond's is
for “the complete man”, WagonR positioned itself as a multi utility vehicle
(MUV) to distance itself from Zen (before it was re-launched) as both are
Maruti brands.
Brand Positioning and Perception

As stated earlier, positioning has its foundation in concepts of perception.
A positioning (or a perceptual map) provides an idea about how consumers
perceive brands specific to relevant dimensions. In Figure 4.2, two dimen-
sions are chosen. They are traditional to trendy and economy to premium.
It is possible to map the existing brands and this enables a new brand to enter
the consumer's mind. Perceptual maps enable the marketer to provide the
competitive angle to the brand. It should be noted that considerable primary
information is required to obtain the two dimensions in a map. When there
are more dimensions preferred by consumers in a product category, market-
ers need to use sophisticated marketing research techniques to simplify the
dimensions chosen for the positioning exercise.
Positioning that starts as an attempt by the brand to get into the psyche of
the target segment should be nurtured in the long run to build a sustainable
* Louis Phillipe *Benetton

Premium
*Allen Solly
Traditional Trendy
(Classic)
* Peter England
Economy
Figure 4.2  Positioning and Perception

association. Pepsi's association with the younger generation, Titan's with

lifestyles of consumers and Volvo's association with safety are examples.
When a brand develops an additional association, it has to ensure that the
additional association supplements or complements the original association
without contradicting it. Raymond's association with the “complete man”
lifestyle proposition strengthens its earlier positioning as the “guide to a well-
dressed male” (which was the positioning of the brand during the previous
years). Santro i10's association with Shah Rukh Khan strengthens Santro's
earlier association with both the celebrity and lifestyle positioning. Various
aspects of sustaining brand associations have been treated elaborately under
repositioning dimensions.
Perception and Prices

Prices have been used by marketers as an input signal to the perception of
quality among consumers. It is not uncommon for consumers to equate high
prices with high quality, particularly if backed up by appropriate associations
like a premium brand name or an up-market retail outlet. In several product
categories like televisions, confectionery and fast foods, consumers compare
the brand's prices with those of the one they have in mind. These are internal
reference prices. A number of brands of colour televisions used to mark the
price tag below Rs 10,000 as consumers may have this as their internal refer-
ence price. A popular blade among the masses did not increase its price for a
long time as this may have affected the perception of consumers. Soft drink
manufacturers like Coke, Pepsi and confectionery brands like Cadbury's and
Nestle are concerned with price points, especially at the entry level minimum
prices. The re-emergence of 200 ml bottles in soft drinks (some years back in
the Indian context) and the Rs 5 price point in chocolates, 50 paise in confec-
tionery and Rs 2 of Nestlé's liquid chocolate are examples of internal reference
prices taken as indicators for pricing offerings.
External reference prices are those that consumers compare across outlets
for the same brand. A price discount offered by different retail outlets in
the category of consumer durables is a good example. A consumer want-
ing to buy a model of LG TV may compare the external prices for the same
brand and model across retail outlets. Similarly, for men's readymade wear,
leading brands like Louis Philippe, Arrow or Park Avenue may have fac-
tory outlets that offer a discounted price for select offerings. These outlets
may appeal to a segment, which may like to have the brand after comparing
prices across retail outlets. This segment may also be prepared to select from
a smaller variety (designs) if they get the brand of their choice at economy
outlets. These consumers compare external prices, probably after comprom-
ising on variety.
Transaction utility is another factor that has an impact of price perception.
This relates to the satisfaction a consumer derives from making a deal within
a particular price range. This is closely related to the internal reference prices.
Transaction utility may be applicable to a cross-section of consumers who may

predominantly have their satisfaction tied to the transaction limit they have in
mind. There may be a cross-section of consumers who may not mind crossing
over its internal reference price and may not want to come across as stringent
“price hunters”. But a brand would do well to research its customer segment
to find out the degree of association with transaction utility. Brands that have
successfully used penetration pricing like Nirma, T-Series and Tiger have used
transaction utility to satisfy consumers.
Acquisition utility is the extent to which a consumer feels that the brand
purchased has matched his/her value perception. Though prices are import-
ant, a consumer who is drawn towards acquisition utility may be prepared to
pay more for a brand if he/she is convinced that the price adds to the value
of the acquisition in terms of features or convenience. The implication is that
a brand that carries a premium over other competing brands, should com-
municate the value it offers to consumers, after choosing a segment that will
be interested in acquisition utility as against transaction utility. In this con-
text, value does not necessarily mean functional utility: it may be symbolism
or emotional or group oriented appeal. Red Bull in soft drinks and Fastrack
watches are examples of how advertising/marketing communication can play
a role in acquisition utility. Perception also gets associated with discounts of-
fered by marketers. Tensile price claims can be used to promote a product or a
retail store. “Save up to 50 percent” is an example. Objective price claims pro-
vide a single discount level (save 30 percent). Marketers find it useful to con-
duct primary research among the appropriate target segment before choosing
the discount method.
Can Brand Images be changed?

In a competitive context, there may be a need for a brand to change its image
depending on the product/market situation. Detailed aspects of concepts as-
sociated with the change of brand image have been elaborated in the Chap-
ter 12 on repositioning. There may be a few brands that have successfully
transformed their images. Cadbury's Dairy Milk chocolate (mould version)
was positioned towards children during the eighties. As the chocolate market
expanded over the years and as adults were also interested in the product cat-
egory (due to changes in lifestyle), Cadbury's transformed the brand image
of the moulded variant in such a way that it was repositioned for adults. The
target segment shifted from children to adults. The “warmth proposition”
of the previous positioning (a gift for the children as a reflection of parental
warmth) gave way to spontaneous and enjoyable “celebration” associated
with everyday life (cricket field dance commercial was a popular TV com-
mercial for the brand). While Gems was positioned for children, Picnic and
Pert were positioned for teenagers. Sub-brands are also used (after careful
research) to reposition and/or change the brand image to signify a new offer-
ing of the brand.
Perceived risks
There are many kinds of risks perceived by consumers. They are functional
(a huge investment in a durable may pose a performance risk), physical (pre-
paring food in a microwave using radiation), financial (if buying a water puri-
fier will justify its cost), social (will the designer jewellery attract attention in
a gathering of friends), psychological (will the consumer feel happy about the
in-flight services of an airlines) and time risk (will the consumer waste time
evoking a warranty). Different categories carry different risks depending on the
consumer's familiarity with the product, his/her economic status and percep-
tion with regard to brand association. Marketers have to examine these risks,
especially when they launch new products. For example, an electric car, which
is a new concept may have to address several perceived risks during its launch.
Retail outlets can provide the support necessary to address some of the per-
ceived risks through demonstration or creating “customized” product aware-
ness based on the queries of the prospective consumer concerning perceived
risks. Such a strategy is likely to be very effective in the diffusion of products
in an emerging market like Indian where penetration across categories is quite
low. Word of mouth, too, is an important source of addressing perceived risks
(for example, a brand of shaving system for women). With the digital media
like Google and YouTube, word of mouth is critical for a brand's success. This is
because unlike advertisements created by marketers, some of the digital media
carry user generated content and consumers may attribute more credibility to it
(or as much credibility) than what they perceive from advertisements.
Figure 4.3 shows the various aspects of perceived risks associated with an
electric car.
Will it accelerate well?

Will batteries create problem?
Psychological aspects of
choosing a new offering?
Fear of
accidents? Electric cars Peer group
acceptance?
Will warranty
policies be Comfort of riding?
dependable?
Value provided
vis-à-vis conventional
cars?
Figure 4.3  Perceived Risks and Electric Cars

Box 4.2
Managing Category/Brand Image
(Indian Context)
 During the mid-eighties, Cadbury's made an effort to change the

image associated with its chocolate drink by bringing in a new
brand Choco Cheer positioned for the youth. The change was fo-
cused more towards the youth and the product category was po-
sitioned using a new brand Cadbury has had a long association
with—its classic “Drinking Chocolate”. Such an approach may be
useful in the present day context to connect with the urban youth
population (Coffee is an age old-drink but has a renewed youth
market in cities with Café Coffee Day and Barista on the lines of
Starbucks in the West)
 Videocon introduced sub-brands like Challenger and Bazooka to
reach out to the higher end of the CTV market.
 Brands like Mercedes, Nissan, Renault or Pugeot are plying as taxis
in several parts of the world, but they do not have the “taxi” associa-
tion (unlike the Indian Ambassador) because of their brand-building
efforts.
 Nesfit, a glucose powder from Nestle, failed possibly because of
its white packaging when consumers associate glucose with green
packaging (though it had used sports celebrities that include Sachin
Tendulkar).
 Johnson & Johnson named its prickly heat powder “Shower to
Shower” to reflect the new offering without the traditional “baby”
association.
 Rooh Afza, a herbal fruit drink marketed in the country for several
decades, attempted to change the image by bringing in a visual im-
agery consisting of youth.
 Madura Coats has Louis Philippe as a premium readymade (shirt-
ing) brand. The company also has Allen Solly, Van Heusen and Peter
England in the category. Careful advertising and retailing ensures
differentiation across the brands in terms of consumer perception.
Pond's used the concept of “Pond's Institute” a few years ago to con-
vey an updated image of itself when it introduced up-market cos-
metic offerings like anti-aging creams.
 Titan focuses on retail outlets to enhance consumers' perception of
the brand. Titan's Sonata (at the lower price end) and Xylys (at the
higher price end) do not have Titan's conspicuous associations at-

tached to them (Refer Plates 2–4).
 Sony used Trinitron sub-brand to project its state-of-the-art offering
in CTVs.
 Park Avenue is a formal readymade wear brand from Raymond. The
company introduced Parx when it entered the informal readymade
wear segment.
 Cadbury's Dairy Milk (CDM) chocolate was positioned for children
in the mid-eighties and for adults in the nineties. It introduced a
variant called Cadbury's Gold positioned towards adults but used
permissiveness in its advertising. Cadbury's Gold was quickly
pulled out of the market. Would it be that the permissive associ-
ation of the variant Gold contradicted the associations of the original
CDM (both were molded chocolates)?
 Onida TV positioned itself as a premium brand during the eighties
with its famous “Neighbour's envy, owner's pride” with the devil
symbolizing “jealously”. Such a firm positioning especially as a pi-
oneering brand in the market (when the market was just develop-
ing) provides a strong foundation for a brand to come out with ex-
cellent products in future.
 Burnol was an ointment for burn injuries. The target segment was
housewives using traditional methods of cooking. When stoves (gas
versions and others) started picking up, the brand attempted to pos-
ition itself as an ointment for burns, cuts and wounds. Despite the
best efforts of the brand to manage the image, a number of consum-
ers may still associate the brand with burns. The brand attempted to
position itself with “Plus” and “3-in-one” prefix but the “burn” prop-
osition is a strong one that may continue in the consumer's psyche.
Brand Perception and Country of Origin

Perception of brands is also affected by the country of their origin. The follow-
ing brands have invariably carried their “country of origin” associations:
* U.K. (class and heritage) – Rolls Royce car
* France (style and class, fashion) – wines, apparel and perfumes
* Germany (quality and reliability) – BMW car
* Switzerland (precision) – watches, knives
* Japan (miniaturisation, value and features) – consumer electronics and cars
The country of origin enables marketers to develop stereotypes (words and

pictures that consumers carry in their mind). South Indian coffee, French fash-
ion or glamour-related brands can take the consumer to the countries of their
origin. Bru, the instant coffee brand, has used this by positioning itself as a
coffee with the taste of filter coffee. Sometimes, a brand may not use the coun-
try of origin. Perfetti, the Italian chewing gum manufacturer, has an American
(sounding) brand name called Brooklyn. Chewing gum is more associated with
the American culture and the brand name would be useful to position it for the
youth who follow or are likely to follow the American way of life.
Levi's, Coke, Pepsi and McDonald brands have American-ness to them.
This has been most instrumental to their success. The US triggers off associa-
tions of hi-tech, entertainment, enjoyment and diligence. In fact, the association
(perception) is so strong among consumers that they give more importance to
brand names of US origin like Mattel, IBM, Nike, Walt Disney and Wal-Mart
though a number of products marketed under these brand names have the
label “Made in Thailand/Malaysia, Vietnam/China”. A country's name can
also change in consumer perception. About three decades back, Japan was as-
sociated with economy goods. Today, there are several Japanese brands like
Lexus, Honda and Sony being bought by hundreds of households in the US.
Taiwan and Korea have also been successful in changing the perception of con-
sumers about their country of origin. LG, Samsung and Hyundai are successful
brands across the world in several countries. Vodka brand names are strongly
associated with Russia and Sweden. In the recent times, a brand called Fin-
landia has made a mark in some of the markets with its association of Finland's
geographical qualities with that of clear vodka (a very creative positioning
stance, given the strong country of origin's association with the drink).
The Concept of Brand Re-positioning

In today's world of cluttered communication, positioning in a market provides
a mental angle with regard to competition. This mental angle is the competi-
tive differentiation that marketers attempt to provide for their offerings. This
aspect is associated with consumer perception of specific product/market, in
the backdrop of which a marketer makes an offering. Positioning is what a
marketer does to the mind of a prospect. Positioning is associating a specific
image with a brand name. It is the act of designing the company's offering and
image so that they occupy a meaningful and distinct competitive position in
the target consumers' minds. While positioning is a well-accepted concept in
marketing communications, the concept of repositioning does not seem to have
been adequately explored by marketers. Positioning does undergo changes. In
a dynamic marketing environment, repositioning a brand is as important as
formulating the original positioning strategy for it. The concept of strategic
brand concept (SBC) probes the three stages (introduction, elaboration and
fortification), through which a brand passes. While SBC delves into brand
strategies that are appropriate to the different stages of a brand's lifecycle, it
does not probe several possibilities of brand repositioning. Ries and Trout pro-
vided some examples of repositioning (Aspro Vs Tylenol comparison is one of
them). Jack Trout with Steve Rivkin gave examples of how a brand (Carnival)
of ice-cream could be repositioned with a renewed perception of itself among
consumers (a range of ice-cream cakes was launched and the brand was po-
sitioned as one associated with Ice-cream Bakery). Calvin Klein modified its
range of cosmetics (with sun-screens) and repositioned the range through de-
partmental stores associated with lower prices. Ries and Trout have suggested
the usage of marketing mix elements in repositioning of brands. Repositioning
is not an isolated marketing exercise. It has to be considered with product-line
management, sub-brands and new kinds of imagery in a changing environ-
ment and a specific brand has to be repositioned in an appropriate manner.
Segmentation—Repositioning Linkages
Segmentation is the process of dividing a cluttered market (in terms of a mix
of consumers) into homogeneous markets in such a way that a company can
target specific consumer segments with its positioning strategies. Segmenta-
tion variables are used to divide the market. In a dynamic competitive context,
marketers should consider the constant changes in their target segments and
reposition the brand accordingly. The following aspects provide linkages be-
tween segmentation-related changes and brand repositioning directions:
(a) How should brands be repositioned when a segment of consumers buy-

ing brands offering value shift to unbranded offerings? This happens in
un-organized markets in categories like edible oil, pens and moulded lug-
gage. An un-organized market is one which has a number of unbranded
offerings promoted only through low prices in local markets. They are
generally not barnded and fall short of quality expectations. These of-
ferings are sold within a vicinity of about 20 to 30 km from the place of
manufacture and some of them may also be illegal offerings (duplicates).
(b) How should a brand that wants to appeal to a different segment be
repositioned?
(c) How should a brand that wants to supplement its existing brand person-
ality position itself for an additional segment to be repositioned?
(d) How should a brand, successful with a functional proposition, be reposi-
tioned to another segment that may require a symbolic orientation apart
from the functional qualities?
(e) How should a premium brand that wants to enlarge its niche segment
after it has created brand awareness, be repositioned?
(f) How should a brand be repositioned when it wants to reach out to con-
sumers at the upper end of the market? (It has to be ensured that the
brand does not get into an “image trap” as it is moving from a down
market to an up-market position).
(g) How should a brand be repositioned when it wants to shed its image
(due to competitive reasons) after maintaining a proposition for a period
of time in the market?
The seven linkages point out to the fact that brand repositioning, in a com-
petitive environment, involves a combination of issues concerning brand as-
sociations, sub-brands, product-line offerings and marketing mix elements.
Brand Associations and Sustainable Core

Proposition (SCP)
A brand is a competitive offering (product, service or concept) with unique
functional and/or emotional associations. Hence, the associations connected
with a brand may reflect rational and emotional benefits. Brand personal-
ity is one of the tools to achieve them. The associations need to be endur-
ing because they give the brand sustainable differentiation in the long run.
Strategies associated with brand or product-line management should take
into account the long-term impact of brand associations. The brand variants
should ensure that their associations do not contradict the original associa-
tions of the brand.
Brand associations have to take into consideration the sustainable core
proposition (SCP). An SCP is a brand proposition (functional, psychological or both)
that needs to be nurtured and developed during positioning and maintained during
repositioning. It gets reflected in associations relevant to the brand. The concept is
vital because it can trigger off anchored perception. “Anchored perception” is
the cumulative impact of consistent brand associations developed over a pe-
riod of time. This essentially requires the core proposition of the brand to be
maintained, regardless of the variants launched or how the brand is extended
or repositioned.
In simple terms, brand repositioning can be associated with a change in the
perception associated with a brand and its new associations gained, nurtured
or strengthened for such repositioning. There may be a few instances when the
brand completely changes its associations in order to appeal to a new target
segment but these instances are unusual. Cadbury's (molded version) reposi-
tioning towards adults after strongly focusing on children and Pond's associ-
ation with high-end products after being a lower end talcum powder for many
years are such examples.
SCP Strategies and Brand-Related Dimensions

in Repositioning
There are seven kinds of repositioning strategies, taking into consideration
the segmentation repositioning linkages and the basic idea of SCP and brand-
related dimensions.
Value-oriented Repositioning This strategy is useful in two situations: one,

when a brand offering value is competing against the unorganized sector (explained
in the examples given below) and two, when a brand has strongly established a
value proposition. The examples given below are old ones but ones that offer in-
sights for a conceptual direction. These three examples reflect the importance of
repositioning a brand associated with value in the perception of consumers.
Reynolds is a brand of ball-pen that was launched in India during the
eighties. It was nearly double the price of the other competitive offerings in the
market. These offerings, which were in the un-organized sector (without reg-
istered brand names and marketed in a small territory), were of poor quality.
Reynolds used the skimming price (higher price point) strategy and became
a successful brand. Besides, Reynolds also had a sturdy product casing (apart
from a good, uniform flow of ink that ensured easy writing). Though consum-
ers paid more for Reynolds, they perceived it as a reliable brand. Reynolds
created this positioning and association through a good product and higher
price. Its advertisements created awareness but the associations came from
a “price quality” perception in the ball-pen market. Repositioning Reynolds
should involve a better quality product and higher price (even if variants are
launched), especially when a number of brands have entered the market with
similar offerings.
Akai was practically institutionalized in the second-hand TV market in
India. At a time when consumers perceived “price–number of features” com-
bination as an indication of value, Akai created value perception by announc-
ing exchange schemes. There were schemes by which consumers could ex-
change their existing television for a new one and pay around 50 percent of the
price for a new television. In a market where brands were attempting to pos-
ition themselves as “no frill-low price” or “feature ridden” or through com-
parative advertisements that emphasized a few extra features, Akai entered
the mind of prospects through sales promotion schemes. Akai could position
itself as a brand that offers value through good sales promotion schemes. Re-
positioning, for Akai, will work through sales promotional schemes that are
enhanced through proper value addition. The creativity in repositioning ex-
ercise for Akai will lie in the ability of the brand/organization to launch in-
novative and competitive sales promotion schemes. If a brand relies on certain
unique characteristics of the market (large number of second-hand buyers in
this context), it may be effective to use a similar approach while repositioning
it. Of course, there are other options like creating a high quality product and
symbolic aspects. But the unique association of a brand is carried over with an
innovative approach that is associated with the original positioning strategy.
The edible oil market in India is largely dominated by manufacturers of
loose oil who sell unbranded, unpacked edible oil. The branded ones cater to
the upper end of the market. Vendee, a brand of edible oil created a differen-
tiation by reaching out to consumers through vending machines—in an un-
packed form. There was standardization of quality with regard to this brand.
Consumers (in the loose-market segment) who were used to inconsistent qual-
ity of edible oil may have thought of upgrading to Vendee. The positioning
route of Vendee was through an innovative distribution channel. It was distrib-

uted through vending machines. Repositioning the brand will involve a bet-
ter quality of oil variants through vending machines. This will give the brand
credibility as Vendee's original association has been with vending machines.
Segment-oriented Repositioning This strategy is useful when a brand

wants to change the segment to which it is currently catering.
Sunny was a two-wheeler scooterette (a hybrid between a moped and
scooter), which was initially positioned for teenagers. The brand was endorsed
by a well-known sports celebrity. The initial positioning was through a novel
product (scooterette) and the glamour of the celebrity both of which may have
appealed to the target segment. The company probably realized that the prod-
uct (60 cc) was not much of a success in the market. This was reflected when the
brand was repositioned as Sunny Zip and it was upgraded to 75 cc. The target
segment for the repositioned product was women, comprising the housewives
and college-going girls. The repositioning involved up-gradation of the prod-
uct, change of segment and a sub-brand (Sunny Zip). The advertisements did
not incorporate a celebrity. They showed typical users of the product. Brand
imagery was used to strengthen the brand association. This is an example of
brand repositioning for a new target segment after the product is modified.
Another interesting example is the Fair & Lovely fairness cream. After
decades of positioning on the fairness platform for young people, the brand
started targeting middle-aged married women. The TV commercial amplifies
the usage of the brand by a married woman (user imagery) and not so much
the brand benefit (which has been hammered in for years). This approach also
shows how a benefit can be extended to different segments at different times,
especially when the original target segment may be exposed to new brands.
This approach may require development of a strong brand before such a repo-
sitioning is done. Fairness, as a benefit, was being extended to married women
at a time when personal grooming has become important for consumers in the
Indian context. The brand did not continue the repositioning presumably be-
cause of strategic reasons and gave away to several other variants subsequent
to the repositioning.
In consumables, Cadbury chocolate (molded variant in the rectangular
slab) was positioned for children in the eighties. In the nineties, the same
variant was directed towards adults using a change in the brand imagery.
The objective of the brand was to expand the market and bring in adults into
its segment. Cadbury introduced a variant of the molded version under the
sub-brand Cadbury's Gold. This sub-brand was positioned on a permissive
and mischievous personality platform with appropriate visuals (in the TV
commercial). The TV commercial showed a lady clad in permissive apparel in
a gymnasium embracing men. This association contradicted the “fun-loving
adult” association of the earlier molded variant that was not considered as
permissive in the Indian context (during the time the brand was launched, and
the context has changed since then). Cadbury's Gold did not sustain itself in
the retail shelves. “Was it because of the contradictory brand associations?”
is the conceptual angle that needs to be addressed while discussing repo-

sitioning strategies. This example reflects the impact of positioning a new
variant using overall brand associations, associated also with the earlier
variants.
Celebrity-oriented Brand Enhancement Repositioning This strat-

egy is useful when a brand uses imagery (or a celebrity) to strengthen its asso-
ciation and makes an attempt to enter a new segment based on the strength of
the same imagery.
BPL, a brand in consumer electronics, originally operated in business-to-
business marketing (X-rays and telecom) before moving into televisions, its
first product category in consumer electronics. The brand initially positioned
itself as one associated with high technology. This is a typical example of a
brand attempting to use technology as an intangible. Consumers may have
exhibited a strong preference towards the brand because of its technology as-
sociation without even knowing its intricacies. During the mid-nineties the
brand repositioned itself using a celebrity association. The celebrity had a
charismatic appeal (for the masses as well as the elite) and would have been
a good fit for the brand, which was targeting the rural Indian population.
The company is also marketing refrigerators, microwaves, radios, CDs and
kitchen appliances. The repositioning using a celebrity did not elaborate on
product attributes or benefits. It used ethnocentrism, a personality-related
concept that reflects a strong tendency on the part of an individual to buy
products that are made in his/her own country. The celebrity in the TV com-
mercial spoke about the conviction that consumers should have about Indian-
made products. This was an effective strategy considering there are a number
of multinational companies in the consumer electronic categories in India.
The repositioning exercise added a favourable “Indian” association to the
brand that had a favourable image. The repositioning may have also helped
the brand to make an impact on rural consumers, for whom the celebrity held
a tremendous charisma.
Symbolism-oriented Repositioning This strategy is useful when a

brand with a strongly entrenched “functional” image wants to expand its mar-
ket using a symbolic positioning without losing its earlier association.
Bajaj, a brand in two-wheelers, was in the Indian context for over several
decades. The brand personality of Bajaj was “rugged, trustworthy, economy-
oriented and a family friend”. With lifestyle changes in the nineties, Bajaj at-
tempted to reposition itself as a contemporary hip two-wheeler. Bajaj came
out with specific sub-brands (affixed to the reassuring name of Bajaj–Bravo
and Classic. Both these sub-brands were positioned on the lifestyle platform.
Classic was positioned as a vehicle that provided a comfortable and enjoy-
able experience to an executive who leads a high-pressured life. Bravo was
positioned as a scooter that would appeal to men who like to have a “macho”
image. The repositioning exercise of Bajaj with new sub-brands reflects the
alternatives available for an entrenched brand to reposition itself (there may

be several other factors that go into the actual success of an offering).
Raymond is a well-known upmarket brand in textiles. The brand initially po-
sitioned itself as a “guide to a well-dressed male”. The brand is priced higher
than a number of other fabric brands and it has a network of exclusive outlets
throughout the country. The brand repositioned itself a decade ago as the fabric
for “the complete man”. The repositioning attempted to emphasize that the of-
fering was meant for an up-market consumer who also has his share of family
experiences in life. Repositioning of the brand involved lifestyle aspects after the
functional proposition of the brand was well-accepted by consumers. The life-
style repositioning of the brand has created a strong differentiation for the brand.
Upmarket Technology-oriented Repositioning This kind of strat-

egy is useful when a down market brand attempts an upward stretch, apart
from continuing to serve its current consumer segments.
Pond's is a household name in India. The brand repositioned itself as a con-
temporary skin-care brand using the technology and research association. The
brand used the concept of “Pond's Institute” that was associated with state-of-
the-art products. Pond's currently has skin-care products at the upper end of
the market. The repositioning of the brand created a perception that helped it
to “move” to the higher end of the market without a new brand or sub-brand
from the perception of consumers. It is also worthwhile to note that the brand
could stretch itself upwards without getting into the “image trap”.
Niche-oriented Repositioning This strategy is useful when a niche

brand (premium one) is interested in expanding its consumer base after it has
created brand awareness.
Dove is premium soap at the upper end of the soap market and the brand
has a small overall market share. Initially, the brand attempted to reposition
itself as a moisturizer bar. Dove's TV commercial compared other offerings of
soaps and conveyed that the brand is superior to soaps (establishing the point of
difference after conveying the point of parity to enable the consumers to know
that the brand competes with soaps). The positioning focused on the advan-
tages of using a moisturizer bar. Dove's positioning in a niche market involved
the repositioning of the soap category. The brand continued to reposition the
soap category with a new TV commercial on the same theme. Similarly, ITC's
Fiama Di Wills uses “gentle naturals and effective science” to position its range
of shampoo and soaps at the higher end of the price structure in their respective
markets (See Plate 5).
Change of Image-oriented Repositioning It is worthwhile to investi-

gate the impact of marketing mix elements on positioning strategies. An interest-
ing aspect is that the environment can also influence the positioning of a brand
along with its marketing mix strategies. Maruti 800 (“the no-frill” version) was a
car launched in the economy segment in India during the mid-eighties. The brand
was sold at a premium for three years. Maruti was not a brand, which a middle
class household in India could afford. The periodic price hikes in over a decade
and the proliferation of two-wheeler brands had made Maruti a status symbol, if
not a premium one. When competition entered the market with several offerings
the perception of “value” underwent a change in the minds of consumers. After
15 years of success with the “small” car image, Maruti has repositioned itself as a
car for the Indian middle class. Repositioning has initiated a change in the brand
image without affecting the core economy proposition of the brand.
Ray Ban, the global brand of sunglasses, entered India during the early
nineties through a positioning that emphasized the brand name. Later, the
brand was repositioned using product benefits as the theme of the reposition-
ing exercise. Some variants in the product-line were also positioned on the
lifestyle theme with a specific sub-brand (Killer Loop). Repositioning of the
brand also consisted of introducing low-priced variants to create a percep-
tion that the brand was not as up-market as consumers perceived it to be.
In all these repositioning examples, the brands made use of “image change”.
The sustainable core proposition (SCP) is extremely useful in terms of creating
brand associations suited for the long term usage. But there can be a number of
situations in which the positioning association of a brand needs to be changed,
and the consistency involved in SCP cannot be followed when the brand is not
accepted by target segment. A framework that emphasizes the usage of SCP
and non-SCP strategies based on two specific dimensions can help marketers
to decide on the applicability of the SCP in a given marketing environment.
The framework also helps to analyze the changes required to fine tune pos-
itioning strategies so that the brand is accepted by the target segment after the
initial positioning strategy has failed to evoke the required response.
The Perception–Intention Framework

A brand can use the SCP along with a framework, which offers other alterna-
tives (along with the brand-related dimensions) that do not involve SCP. The
two dimensions that can be used for a “perception–intention” framework are:
(i) intention to buy, and (ii) anchored perception. Anchored perception is as-
sociated with the brand's association and intention to buy is associated with
several aspects of marketing mix elements along with the brand's associations.
The intention to buy can be the final stage in decision-making when the
consumer has adequate knowledge of the product category, competing brands
and has evaluated their benefits and associations. There may be a gap between
the intention to buy and the final buy. This gap can result from several factors
like the availability of cheaper brands, display of point-of-purchase posters
of a competing brand, a sudden recommendation (from personal sources of
information) for a competitive brand or the consumer's perception of the prop-
osition of a competing brand. Anchored perception is the cumulative brand
association, which has had an impact on the consumer because of his/her ex-
posure to the advertising of that brand. Anchored perception can be obtained
using the concepts of brand recognition and recall. A measure of anchored
perception can be obtained from the target segment only after it has experi-
enced the brand association for a length of time in a given product/market
situation. A marketer has to decide the appropriateness of using anchored per-
ception based on competing brand associations in the environment, the period
of the brand's visibility campaigns (involving the associations of the brand)
and the measure of its share after it was launched. The degree of recall and
recognition needed to categorize anchored perception as low or high also de-
pends on a specific market situation. Qualitative techniques can be used to
classify the anchored perception as “high” or “low”.
SCP-Oriented Approach In Figure. 4.4, the top right quadrant can be

associated with a brand that scores high on both counts: the intention to buy
and anchored perception. This indicates that the existing brand associations
put it on top of the recall hierarchy. This increases its chances of being pur-
chased. Pepsi and Coke in the Indian context are examples of soft drinks,
which consists of several brands in the aerated fruit drink and fruit juice (fruit
drinks contain some percentage of fruit juice) that belong to this category.
The cola brands continue their respective proposition to build brand equity.
The principle of SCP can be followed if there is a need for the brand to fine-
tune its positioning associations. Successful brands in this quadrant need to
sustain their strategies to continue their leadership in a given market. It may
be worthwhile to find out if brands with dominant market shares in a specific
category fall under this classification.
New Imagery When the intention to buy is high and anchored perception
is low, the brand may have an attribute/benefit association that appeals to the
consumer but the anchored perception has not been strengthened as reflected
by low recall. A brand in this quadrant can also have a significant market share
but weakened anchored perception, over a period of time, can lower the inten-
tion to buy it.
High
New Mix SCP

Anchored
Perception
Repackage New imagery
Low
Low Intention to Buy High
Figure 4.4  The Perception–Intention Framework.

Brands that have been very successful in the past but have experienced
considerable decline in recent times may have to create new imagery to appeal
to consumers. Consumers may be aware of the brand and may even have a
mild intention to buy the brand. But lack of contemporary associations may
have motivated these consumers to buy some other brand. Sometimes, the
offering needs to be updated and followed up through appropriate imagery.
A brand of popular pain balm has recently introduced a number of new and
updated offerings. This was backed up by marketing communication.
Repackage This strategy can be applied to brands that are associated with
a low intention to buy and a low anchored perception. This is a situation when
the brand fails after initial positioning. There needs to be a new offering: some-
times there needs to be a new brand name as well. Repackage is also applicable
to those brands that have been successful in the yesteryear but have declined
gradually over a period of time. This can happen because of low anchored per-
ception and the offering losing its relevance because of environmental changes
affecting intention to buy.
New Mix A “new mix” alternative can be considered for brands associ-
ated with a high anchored perception and a low intention to buy. In terms
of brand visibility, positioning associations can have a positive impact on the
target segment but they may not trigger off a significant intention to buy. Non-
availability of the brand through a strong distribution channel may be a reason
for the low intention to purchase. There are brands in the Indian context that
advertise effectively before a distribution infrastructure is developed. Con-
sumer expectations from a brand when a variant is launched may also be the
reason for a brand to get categorized in this classification. A successful brand
launching a variant triggers a certain kind of expectation among consumers.
If the variant with or without a sub-brand fails to live up to the expectation,
intention to buy the brand may be low (though consumers will have a high an-
chored perception due to the familiarity with the brand). A good brand (offer-
ing), besides making an impact on the consumer psyche should also provide a
high perceived value to be associated with a high intention to buy.
Repositioning is unique to a specific brand. The distinguishing aspects of
a repositioning strategy are drawn from the nature of the market situation by
the suggested framework.
Developing Brand Differentiations

USP or the unique selling proposition of a brand continues to be a critical issue
in this era of digital marketing. Trout, one of the proponents of the positioning
concept, is of the opinion that any advertising for a brand should sell with a
USP rather than provide entertainment for viewers. USP positions a brand in
the mind of the consumer and creates a strong differentiator for it from among
competing brands in the respective category. Fevistick (adhesive in the form of
a stick) had convenience as its USP even though it is several times more expen-
sive than the regular gum. Maruti (the initial no-frills version) changed the In-
dian consumers' perception of passenger cars. While a USP, in today's context,
can be a benefit from a brand attribute (ingredients of Colgate Total resulting
in multiple benefits associated with oral care), there can be other ways also in
which a USP can be formulated, by taking into consideration the various re-
search inputs from the appropriate target audience. Sidney Levy, a well-known
researcher in the area of qualitative marketing presearch, proposed models on
these qualitative aspects that can be applied to the present-day clutter of com-
munication to ensure that the message is conveyed to the intended segment.
This can be very valuable to a company interacting with an advertising agency
to make sure that creativity is meaningful and practical.
Sidney Levy also suggests what is known as the “thematic universe”, which
can enable brands to differentiate themselves from competitive offerings.
An understanding of this framework can ensure that a brand is able to effec-
tively counter commoditization in several product categories. The framework
contributes to the formulation of images linked to specific brands and can be
effectively used with positioning maps.
Framework for Developing Brand Image

There are a number of factors that influence the development of brand
associations:
1. How a brand is manufactured?
2. The brand's feature
3. Benefits of the brand
4. Organisation-based associations
5. Overall differentiation attributed to the brand
While the framework draws heavily on demographic and psychographic seg-
mentation bases, it provides a specific focus for exploring positioning strat-
egies. This focus helps in comparing alternatives. For example, perceptual im-
ages using advertising creativity may be different for “the ultimate in luxury”
(overall differentiation) and “a friend of the family” (attitude of users) when
positioning strategies are firmed up for a brand of car. Such differences play
a major role in conveying the brand's image, especially when there are many
offerings in the category and all of them indulge in high-visibility advertising
campaigns.
The Manufacturing Proposition

This proposition can be useful for a niche brand to compete in a category
where several brands have pre-empted the usual USPs. Soap is such a cat-
egory. While the basic price defines the segment, brands need a differentiator.
The point of differentiation should be relevant and memorable. This is useful

for a niche brand because consumers may be less price-sensitive and more in-
clined on learning about the intrinsic benefits of the product, especially if they
are told about how the brand is manufactured. This will also make the con-
sumers psychologically comfortable with the premium charged by the niche
brand. A good example is Pears, the glycerine soap. The manner of preparation
is unique and associated with the benefits. Chemicals used in shampoo brands
may also be useful when the brand's USP is new. But the appeal may wear off
after competitors follow suit. Highlighting indigenous or natural ingredients
in the manufacturing process is likely to have a better impact on the target
market. Sandalwood and shikakai in soaps, clove in toothpastes and natural
juice in soft drinks are examples. There may be a strong perception that any
synthetic additive in cosmetics and food is detrimental to the skin and one's
health respectively. The manufacturing proposition can be extremely useful
in the food category. When Pizza Hut and other brands were pre-empting a
number of propositions, Papa John (also a brand of pizza) highlighted the use
of superior ingredients. Samsung introduced a washing machine suited to the
Indian needs with the proposition that sarees can be washed without getting
entangled in the machine.
Feature-based Proposition
Features normally get associated with specific benefits. Brand features take
shape when focused on benefits, especially in categories with which consum-
ers are not very familiar (as in the case of durables). “Natural” in foods means
healthy but “Golden Eye” in a TV brand requires to be explained to the pro-
spective buyer. There are two ways of positioning on features—to either high-
light the feature or link it up with benefits. Traditional marketing wisdom has
always emphasized the need to link benefits with features. But in a changing
environment consumers may not want to process information from elabor-
ate advertisements. The mention of a feature can excite them enough to want
more details at the point of purchase. This is likely to work in the case of
durables when the consumer is actually able to gain a tangible benefit based
on the feature highlighted at the retail outlet. Advanced fuel injection sys-
tems advertised by a few brands of automobiles, agitator action in washing
machines, extra-space viewing in televisions (Samsung) and usage of special
fabric in readymade garments (Van Heusen) are examples of feature-based
positioning. This positioning type can also trigger the word of mouth (WOM)
(Refer Plates (6–7)). Consumers may consult friends and colleagues and the
sheer process of involvement creates awareness about the feature-based ben-
efits advertised by the brand.
Benefit-based Proposition
FMCG categories are usually low involvement ones. Consumers also try out
various brands even as they stay loyal to a brand in terms of purchase frequency.
Features like “added moisturiser” or the presence of a special ingredient may

not convey the benefit. Besides, consumers do not involve themselves much in
processing information about FMCG in the advertisements. It may be worth-
while to position FMCG products on benefits as this will straightaway carry
the brand into the “consideration set” of consumers. Colgate Total was ini-
tially launched as toothpaste that counters several dental problems. It was re-
launched as toothpaste that offers a 12-hour protection. Even in the case of
shampoos, a brand would do well to point out the benefits and appropriately
link them with specific features on the package. Sometimes, features carry a
perception that may adversely affect the benefits. In such cases, an appropriate
benefit proposition has to be selected. For example, a brand of juice concen-
trate may have a vitamin C ingredient where health benefit is implied. But it
has to highlight “taste” as the benefit proposition to ensure that consumers do
not think of the offering as a therapeutic drink.
Organisation-based Proposition
A brand differentiator can also be developed using an association of the organ-
ization. A good example is Wipro's “Applying Thought”. Wipro is in diverse
businesses like computers, finance, soaps, edible oil and medical electronics,
and it may like to convey one basic association common to all the categories.
Body Shop, the global “green cosmetic” company, draws its association from
the environment-friendly philosophy of the organisation. McDonald's is as-
sociated with its traditional value for money, convenience and hygiene. In-
cidentally, most of the top 10 brands selected by Businessweek for the last
several years are those that have company names. GE, Microsoft, Intel, Ford,
Disney are some of them indicating the power of “organization-based” pos-
itioning. Hence organisation-based proposition may be useful to develop
associations.
Overall Differentiation
This develops the “No. 1” association with regard to a brand and can be use-
ful after the brand has been successful in a market for a given length of time.
It is important to note that the brand has to have a significant market share
to use this differentiator and ensure credibility of the claim. Tylenol in the US
used this kind of advertising proclaiming itself as the largest selling analgesic
in the hospital segment. “Bring home the leader” from Videocon and “The ul-
timate in luxury” from Esteem are examples from the Indian context. A brand
using this proposition will have to continuously launch variants and ensure
that competition does not outpace it. The different kinds of propositions are
only suggestive and a brand needs to undertake extensive research associ-
ated with the appropriate target segment before selecting a differentiator. It
is also necessary that these propositions can be used in several ways. Build-
ing a brand differentiator and sustaining it is a major marketing challenge in
today's context.
Perception and Technological Products

In an era of convergence, brands need to be sensitive to the impact of tech-
nology in the psyche of consumers. There is a need for research to find out if
consumers in a specific segment (across categories) are sensitive to benefits of
technology or if there is a “buzz” about technology. For example, Motorola is
likely to introduce mobile phones with entertainment services and Internet.
The user may have access to about 3,50,000 songs in various Indian languages.
The brand is going to introduce iPointers, a feature in mobile phones that will
allow advertisers to get into the “ad space” in mobiles. When a user points
his/her phone towards a shopping mall, he/she is likely to receive advertise-
ments from the various shops in the mall and these can include discounts too!
The brand needs to find out from research, if technology aspects need to be
highlighted or benefits need to be highlighted and to what extent these need
to be addressed to create an overall image for the brand. The perceptual exer-
cise becomes quite complex, given the fact that mobile phones have become
a symbolic tool for the youth. The symbolism could be pride, emotion or any
other psychological aspect. Such decisions on technology-oriented branding
require a comprehensive knowledge about the perception of consumers on
high-technology products.
Positioning and branding are concepts that are readily associated with con-
sumer products and brands. Though the concept of branding industrial prod-
ucts is not new to the Indian context, branding is, by and large, considered to
be at the lower end of the marketing mix hierarchy. Branding is so important in
hi-tech products that it not only creates an impact on the buying organization
but also enables functional areas in an organization to focus on a proposition
that has been communicated to a target segment.
A number of factors, in a competitive situation, establish the need for
branding hi-tech products.
Product Obsolescence
In a category like computers or servers, it is difficult to differentiate one of-
fering from the other because of the rapid changes in the industry. Lenova,
Acer, Compaq and HP offer several combinations for the different needs of
consumers and there is intense competition among the brands to keep pace
with the state-of-the-art technology. The buyer has to associate a brand with a
specific proposition to choose the one most compatible with the organizational
requirements and attitude. A company may place a high degree of importance
on after-sale support and prefer a brand that has a reputation for service sup-
port. Another company may prefer another brand because of its proposition of
easy usage. While most major brands attempt to upgrade their offerings, each
brand has to develop a proposition on which it can position itself. It may be
worthwhile for a brand to research the different aspects of brand associations
(as in consumer products).
Branding and Value

The term “value” has different meanings for different buyers. Branding helps
to communicate the specific proposition intended for a target segment. For ex-
ample, the distributed control system (DCS) may involve several aspects like
performance, responsiveness, and software upgradability. Branding will help
a company reach out to the buyers with a specific product need. In telecommu-
nications, some buyers may require state-of-the-art applications and choose to
buy a specific brand.
The “Inward” Impact of Branding

In hi-tech products, it is not just the advertising visibility that creates the im-
pact of branding. Branding is a result of a focused internal effort to provide
the most appropriate products and services for the selected segments. Hence,
different functional areas may be involved in planning the product/service,
depending on the needs of customers. For example, TISCO can brand its
value-added services to the automobile sector after identifying special-need
segments that the company's new cold rolled mill (CRM) infrastructure can
service. Identification of needs, bringing in internal coordination and pro-
viding solutions in the form of a brand helps to entrench the offering among
buyers. Internal coordination is vital because of customized requirements.
In spite of its early entry into the Internet domain, Netscape did not build a
brand on a specific proposition. Microsoft with its Internet Explorer domi-
nates the market.
Costs of Customer Service

As a company develops its market with product offerings, there is a need to
customise the price and services or products for different customers. There
may be big and small players in the category of machine tool controls. It may
not be possible for a firm in such an industry to provide the same level of ser-
vice to all customers. Branding helps the company to package the service to
suit the customer's needs. A small organization cannot expect the kind of re-
sponsiveness and service support that a loyal large organisation gets from a
marketer, even though both of them buy products and services from the same
source. Solutions and prices vary and there is the profitability from the mar-
keter's viewpoint.
Branding is Reassurance
Industrial products may incorporate a number of components, sub-
assemblies, software programs and system interfaces. An industrial automa-
tion system branding for a specific segment (like energy, chemical or oil) can
use different brands of computers and software programs from various ven-
dors employed by the company marketing the product/project. Branding
reassures the customer about the quality of the final product and the com-
pany benefits if the customer spreads a positive word of mouth about it.
It must be clarified that the company's name itself can be used as a brand.
Intel with its “Intel Inside” campaign is a good example to illustrate this
point. But most companies in hi-tech businesses may cater to different seg-
ments, each with its own specific needs. Hence, a company can develop dis-
tinctive brands or even sub-brands for specific segments. In case the company
builds sub-brands, it can use the equity of the mother brand and develop a
clear proposition for the sub-brand, so that customers can associate the sub-
brands with the mother brand. This is important because a sub-brand loses
its identity without a specific proposition.
Testimonial Route
Branding, based on the testimonial route, can be very effective. This is true,
especially of new products. New types of imaging technologies used in bio-
medical equipments and chemicals used for developing special packaging
materials are areas where such branding can establish credibility and enable
the company to access innovative organizations that are ready to try the prod-
uct. Even in established product categories, testimonial advertisements enable
a brand to gain a significant competitive advantage. Compaq used to adver-
tise (in developed markets) that its systems are used in advanced stock mar-
kets around the world, conveying, thereby, the “reliability” proposition of the
brand.
Brand as a Point of “Contact”

Customers may deal with middlemen or value-added resellers who may in-
stall an offering, or be involved in using the offering for upgradation. As an
extension of the earlier point on reassurance, branding creates the positive
perception that end-customers are linked with the manufacturer rather than
the distribution intermediary. In this context, once branding is established, the
manufacturer should make adequate efforts to train and monitor the perfor-
mance of intermediaries who interact with end-customers.
The Process of Branding Hi-tech Products
Selecting the Brand Proposition

The basic difference between the process of branding consumer and hi-tech
products is the involvement of buyers within a sigment. A firm may be target-
ing several organizations within a segment. For example, some computers or
telecom organizations may require rapid upgradability, in terms of both hard-
ware and software. Research is required to probe the diverse dimensions of
this exercise. This will enable a brand to decide whether to brand the product
or the service. Current potential as well as the growth in the segment based on
a specific dimension should be taken into consideration.
Communicating the Brand Proposition

Communicating the proposition to a specific buyer is important. In order to
achieve this, selection of promotional methods should be given due import-
ance (see Figure 4.5). Steel Authority of Indian Limited (SAIL) introduced spe-
cial types of steel with distinctive properties. While the buying organizations
may be interested in the benefits, there may be other firms that may be inter-
ested in the technical nature of the product. A general awareness campaign
can be backed up even by a promotional video explaining technicalities to the
appropriate buying influence. Another set of buying influences may be inter-
ested in the cost saving aspects and, hence, a personal selling presentation may
be required. Many years ago, Du Pont was able to charge a premium for its
chemicals because it could effectively build a “techno-message” around it and
convey it to the right buying influences.
Importance of Research
The final stage in the ongoing brand management process for hi-tech products
is to probe and research brand associations, both of the brand that is being
marketed by the company and competitive brands. This is essential because
several brands are likely to follow a pioneering brand and the clutter in con-
sumer marketing may be experienced in industrial marketing. Brand associa-
tions can make a vital difference apart from the benefits of technology that a
company offers (as in the case of Intel).
Product Implication of Brand Internal

Proposition Functional
Areas and
Segment Infrastructure
Required
Buying Influences
“Value”
Brand Proposition
Figure 4.5  Branding Technology-oriented Products

Box 4.3
Perceptions and Propositions
Martin Lindstorm et al, in their book Clicks, Bricks and Brands, have men-
tioned several kinds of propositions that have been used over a period
of time. While the authors have projected the usage of propositions as an
evolution over time, it may be possible to view this approach differently
in the Indian context, given the complexities of consumer behaviour in
the country. Creating brand associations that will have a long-term im-
pact on consumer psyche is a prerequisite for a brand’s success. These
associations surrounding a brand (new or established) depend on several
factors like the equity of the brand, competitive factors, type of target
segment, clutter of communication in a specific category and the reposi-
tioning strategies used by a brand in a dynamic context. Concepts of con-
sumer behaviour will be useful in deciding the specific proposition that
can be adapted and nurtured by a brand over long term. For example, if
consumers attach a tremendous amount of credibility to names like Tata
and Wipro, the brands of these companies can use Cult-oriented Selling
Proposition (CSP). Brands that rely on emotional appeal like Raymond,
Titan or even symbolic ones like Omega and Rolex follow the Emotional
Selling Proposition (ESP). The utilitarian proposition is the traditional
USP, which has been used since the fifties. The ESP carried to the extreme
will become a CSP. For example, a manufacturer of biscuits or confec-
tionery targeting children can create a character and the brand will sell
because of the cult association. Cigarettes, perfumes and adventure bikes
can also make use of this proposition. The “Me Setting” proposition is the
one which customizes the offering to the needs of the buyer and is very
futuristic. A fashion brand of apparel may target a micro niche and make
the offering unique to the consumer. The service part of the proposition
becomes the differentiator in this case.
The kind of proposition chosen will have an impact on the brand’s
perception. Exploring the psyche of the consumer (existing or prospect-
ive) enables a marketer to choose a proposition that provides the max-
imum value for the brand.
Image Associations
Any element of a brand, which is amenable to image development adds to
the image of the brand that is distinctively different from its the core offering.
Image associations create the perception surrounding the brand, which is a
combination of the core offering and the image. For example a cola named Sip
with a different colour or bottle cannot produce the same set of associations
Box 4.4
Perception and Symbolism
Consumers do not just buy brands for what they can do; they also buy
the symbolic meaning associated with a brand. These may be oriented
towards the self-image of consumers, group affiliations or status dimen-
sions. When a consumer buys Nike, he or she may not buy the brand
because of its utility alone. He/she may purchase the brand for its as-
sociation with youthfulness, fitness, independence and fashion which
boost his/her self-image. Consumers buying Rolex or Omega may feel
they belong to the higher strata of the society and can afford such status
or prestige symbols. Saturn, the car from General Motors, was not only
just a comfort car with value. It was also perceived as the “in thing”. The
brand also created a club for its owners and brought in a sense of affilia-
tion among its members. Charms cigarettes of the yesteryear reflected a
“feeling of independence and non-conformist attitude”. This may have
appealed to a consumer who identifies himself with the “new-wave”
youth. A brand may also develop an imagery which uses both utilitarian
value and symbolism.
connected with Pepsi or Coke. In certain cases, the core offering that includes
the features of the brand may also contribute to the image of the brand. Cer-
tain variants of the Volvo car brand, known for safety, have additional gears
though they are positioned as family cars. This is to cater to the perception of
target consumers in an appropriate manner.
Bajaj
Bajaj defined the scooter category in India. During the seventies, its Chetak
brand had a waiting list of several lakhs of consumers who had booked the
brand. Value for money, ruggedness, easy maintenance and its Indianness are
some of the associations linked with Bajaj. Bajaj initially launched the RTZ mo-
torcycle and positioned it on speed, agility and acceleration with the “Cheetah”
commercial. Then came 4S with its functional proposition of fuel economy and
comfort. The biggest success of Bajaj was Caliber, which sold over a lakh of units
within a year of its launch. Changes involved in the perception of Bajaj were in-
strumental in the success of the brand. Bajaj took the emotional route to position
the brand. The personality trait of fortitude or winning over adversity in life
was at the core of its positioning. It shows a man going after his girlfriend only
to find that she has settled down. The sequel to this shows an army man tiding
over uncertainty to join his family for a holiday only to be called back. There
have been a few more TV spots and all of them emphasize the personality with
“fortitude”.
Bajaj has also attempted to connect with youth and their lifestyle. The
Hamara Bajaj campaign of the eighties projected the Indianness of the brand
while the sequel to this campaign shows a number of sequences that reflect
the “hip” appearances of Indian youth (Western overtone) who also respect
Indian culture (Indianness).
Perception and Brandnames

A brand name should indicate the product benefits and support a symbol.
It should be easy on the tongue, easy to remember and be meaningful. While
all this holds (SONY was selected with the American market in the offing so
that it could be pronounced well) in today's clutter, there are a few things to
remember:
“Sunday” is the name of a popular mobile phone brand in the competitive
Hong Kong market. The name has no association with the product benefits.
It appealed to the youth as it triggers a “lifestyle on a Sunday” idea. If the tar-
get segment is based on lifestyle, such associations can be useful. Charms, in
the Indian context, is another such example.
If the brand is in competition with low-value competitors, anything which
reminds the consumer of the benefit would be useful. Several brands in com-
modities like wheat and rice attempt to create value by highlighting their ben-
efits. McDonald, Kodak and a few more brands named after their founders
have succeeded even though they did not hold out a benefit. But one has to
remember they were the pioneers in their products without the clutter and
competition.
Finally, the top 10 brands in the world named by Businessweek for the past
several years are the ones which have used their company names (Coca-Cola,
Microsoft, IBM, GE, Nokia, Intel, Disney, Ford, McDonald, AT&T—in that
order). A variety of parameters have been used in such exercises on brand-
ing and it is interesting that most of them belong more in the industrial con-
text. The equity of Mercedes went down because it launched models at the
lower end of the market when the brand has been traditionally associated
with luxury.
Ayurvedic Concepts changed its umbrella brand to Himalaya. Brands can
become generic if they are too close to the category. They may also become
generic if they are the pioneers (Xerox, Dalda and Aspro). In such cases, the
brand should increase its visibility through constant association with the cat-
egory and update the offerings constantly.
Naming a brand is one thing and sustaining the success of the brand,
another.
Creating a Market for a New Offering

among Substitutes: Perception and Marketing
Mix Elements
Milkfood launched yogurt (sweetened curds in different flavours). The prop-
osition of the brand was that it offered tastier curds than the home-made
ones. (Curd is a staple food item in most parts of the country). Milkfood
also launched ice-creams in different flavours. Both the categories were sold
through the same retail outlets in most areas. The pricing of the yogurt was
higher compared to the home-made curds. Given this background, consum-
ers may have mistook yogurt (taken as an alternative to ice-cream in the US
for health reasons) to be a special kind of ice-cream that does not taste like
ice-cream. There may have also been some confusion because of the flavours.
The proposition of taste at a higher price may have also discouraged trials and
repeat purchases.
When a brand introduces a product that has close substitutes:
1. It has to have a distinctive brand name, that ensures that there is
no confusion. It should not be common to the other products of the
company.
2. Point-of-purchase posters on the new product must be put up at the retail
outlets to ensure that consumers associate it with a new category.
3. When very close substitutes are available, skimming the market with a
high price may create transaction/acquisition-based satisfaction and this
influences the perception about the purchase of the new offering (even in
FMCG products).
4. Communication about the brand (new offering) has to revolve around
an aspect that is not oriented towards changing strongly entrenched
beliefs (especially with regard to foods, as they are a part of consumer's
culture).
Touch of Reality
India's Macho Motorbike
Bullet motorcycle (from Royal Enfield Motors) is a 50-year old brand.
It has been traditionally associated with the macho image. While sev-
eral brands are vying with one another on the aspects of contemporary
styling and technologies, Bullet* has the opportunity to become India's
macho motorbike. The passionate “die-hard” followers could create the
right kind of “Buzz” among the youth to make this brand a cult brand in
a niche market. In the year 2007–08, the brand sold around 38,000 units.
Bullet's example reflects how perception plays a role in shaping the image
of a brand in a competitive market in which brand image is vital. The
brand has a right gear shift (when all brands the world over has moved
to left gear shift. The company has launched a new model with a dif-
ferent brand name, Thunderbird to target up-graders from small bikes.
Bullet Machisma 500 targets young bikers. The brand does not advertise
as aggressively as other brands in the market. Being a niche brand with a
macho image, the strategy encourages word of mouth (buzz). The brand
has done away with discounts, thereby not linking price sensitivity with
the brand. This strategy along with the brand's past image, adds on to
the perception that consumers would buy the brand more out of passion
than because of a price deal. The Royal Enfield brand stores attempts to
provide an experience to the prospective buyers.
Inddiehumpers Club is a community formed by the owners of the
brand and the company has a Web site to encourage online interaction
among the owners of the brand to enhance affinity among the owners
(another form by which buzz can spread fast).
The Web site is related to stories, problems and solutions about the
brand. In a world that is getting ahead with functionality and benefits,
heritage brands with more of symbolism than benefits, can be created to
hold consumers' attention – if principles of perception are appropriately
applied.
* “All about ads”, NDTV Profit channel (interview with Prahlad Kakar), Oct 18, 2009 (10 PM)
5
Learning Principles and

Their Usefulness to
Branding Associations
In a cluttered environment, marketing communication depends on focused

creativity. Focused creativity (a) has to be meaningful to the target segment;
(b) has to have a competitive orientation so that the communication gets differ-
entiated; and (c) has to make an impact on the consumer psyche to the extent
of at least reminding the consumer about the functional or emotional propos-
ition of a brand. An established brand has the advantage of having “entered”
the psyche of the consumer. Colgate is associated with prevention of tooth
decay and Lux is connected with beautiful skin. The three aspects of the mes-
sage (related to creativity) formulated by a brand has to take into account how
information is processed in the mind of the consumer. Incidentally, knowing
the process may also enable a marketer to identify a brand proposition. Cre-
ativity related to marketing communication requires knowledge of consumer
behaviour. Advertising agencies that are involved in creativity can benefit a
lot if certain concepts of consumer behaviour are considered in the creative
process.
The Concept of Conditioning

The principles of learning provide interesting insights into the understand-
ing of information processing. There are a number of theories associated with
these principles. This part of the chapter deals with theories of learning and
attempts to highlight those areas, which have a direct implication on the cre-
ative aspects involving brand messages.
Classical Conditioning
Classical conditioning deals with the process of associating messages/ feel-
ings/situations with a brand on the assumption that the feelings/messages/
situations get strongly identified with the brand. Such a process is aimed at
creating the brand's associations in the psyche of consumers. For example,
cricket, films and pranks, besides many other aspects, denote youth associa-
tions. Hence, having identified the younger generation as its target segment,
Pepsi has used visuals of these three aspects in their brand messages. The basic
point in such a context is that there are specific situations, which trigger off
pleasant sensations and feelings and these situations are being associated with
a brand. When a brand aggressively creates visibility using these visuals for a
period of time, consumers may internalize the brand as a part of the feelings
and experiences associated with these situations. Pepsi is associated with film
stars or cricket celebrities or the fun that young people indulge in. A marketer
of photographic films may associate the brand with the feelings of warmth.
Kodak did this in some of its markets. Titan's association with gifts and the
warmth related with gifts is interesting from the viewpoint of its brand iden-
tity. The situation chosen has to be one that elicits a known response from the
consumer, preferably, a favorable, emotional one. The process of using this
concept is given in Figure 5.1.
The following have to be taken into account before a brand decides to use
a specific feeling/situation:
1. Researching the market is a prerequisite, as a suitable emotion is required
to be paired with the brand. The emotion or a specific situation, (which
may be called the relevant stimulus) is likely to be the core aspect of the
Experiences
Brand Consumer Situations
Feelings
Choice of specific factor
Is it relevant to the brand? Research
Formulation of visuals
Figure 5.1  Selection of Brand Associations

5  Learning Principles and Their Usefulness to Branding Associations 149
brand imagery and has to be selected with great care. When an inter-
national brand of jeans entered the Indian market, the brand chose a ce-
lebrity who may not have appealed to the target segment of the brand.
2. The imagery selected to be paired with the brand, has to be relevant to
the product category. Selecting warmth as an emotion for a brand of
photographic film is very meaningful as warmth is associated with nos-
talgia or memories. This becomes the brand's benefit for the consumer.
3. It is essential for a brand to plan a specific emotional proposition (it can
even be functional) to ensure that the brand offers a sustainable differen-
tiation in the long run.
4. A marketer should be extremely careful in selecting an association (it
can even be a jingle) especially, when stimuli (picture/visual or song) se-
lected is over-exposed to consumers. The over-exposed stimulus can be a
film song or even a celebrity who has endorsed many brands. A brand of
chocolate may associate itself with a popular film tune but the popular-
ity of the tune can take away the novelty associated with the brand–tune
pairing.
5. Negative emotions may also be used. An insurance company can use a
degree of fear appeal. But research shows that using strong fear appeals
may be counter productive. In the recent times, several insurance brands
have focused on positive aspects of life like an enjoyable retirement or a
fine future for children to ensure that fear appeals do not create a nega-
tive feeling towards the brand.
The initial success of Onida based on its “devil” ad symbolising neigh-
bor's jealousy used a negative emotion in an interesting manner. Onida
was one of the earliest brands in the Indian context in the eighties and
probably the first to be advertised on a premium plank. The off-beat execu-
tion may have generated interest and taken it into the “consideration set”
of consumers along with a few brands that existed at that time.
Fear/negative appeals can be used in a creative and meaningful man-
ner from the viewpoint of a consumer's psyche.
Instrumental Conditioning
Instrumental conditioning is a concept, which deals with the desirable reward
a consumer gets when he gives a favorable response. A brand of shampoo may
prove to be a good choice for dandruff and a brand of readymade wear may
be both comfortable and appealing to the peer group of the consumer. Service
provided at retail outlets (quick check-out during peak hours in a retail outlet
like Nilgiri's) can also reinforce consumer behaviour in terms of repeat buying
or patronizing a retail outlet. This conditioning can also be applied creatively
on the Internet. The basic assumption of applying these principles on the Inter-
net is that reinforcement of behaviour can also result from the experience (and
not only from a good product) provided to consumers. Research shows that
surfers spend more time on Amazon.com than on any other site. Coke's Web
site provides an experience to the visitor by guiding him/her to places that
are cool and fun. Surfers can score their own jingle based on Coke jingles. Hall-
mark greeting cards enable consumers to send customised messages on the
Web. In these examples, consumers have a motivation to return to the Web site
and this may also creatively reinforce the brand in the consumer psyche. While
instrumental conditioning helps FMCG consumers with regard to repeat pur-
chases, marketers of durables may also benefit by ensuring that consumers
keep coming back to them, so that they can be targeted during the replacement
cycle or for marketing other products of the company. BPL may have millions
of consumers using at least one product of the company. The importance of
ensuring a sustained contact with the consumer need not be over-emphasized.
CRM and Instrumental Conditioning A company can plan a contact-program
with consumers after the sale is over. Instrumental conditioning, in such a situ-
ation, triggers off what is called (customer relationship management) CRM.
CRM has several complex dimensions. In this chapter, a reference is made to
the concept in association with instrumental conditioning because of the basic
fact that mutually rewarding relationships last for a long time. There are four
phases identified with regard to customer-interface in durables:
Traditionally, after-sales service has been the only phase associated with
customer-interface. This offers very little scope for a marketer to have a sus-
tained interaction with the customer. For example, after the installation of the
durable, it may be a month or even years before the customer thinks of the
company. The post-sale phases indicated in Figure 5.2 help in planning, moni-
toring consumers and formulating specific communication strategies in dis-
tinctive stages extending the “response-reward” mechanism associated with
instrumental conditioning.
The satisfaction phase immediately follows the purchase phase. The cus-
tomer wants to fully explore the product—using its features, exploring its
Satisfaction Phase
“Inactive” Phase
“Search” Phase
“Intense”
Search
Replacement Phase
Figure 5.2  Post-sale Phases for Durables (Can also be used for Cross-
selling)
benefits and experiencing how he/she has benefited from the purchase. Though
the “reward” is the benefit itself, it may be worthwhile for a marketer to re-
inforce the customer's decision of selecting the brand. This reinforcement may
start with a personalized “thank you” letter and be followed up by company
personnel—by explaining the brochure accompanying the brand and/or tak-
ing a personal interest in familiarizing him/her with the product. There is also
a need to provide an exclusive telephone/Web access to consumers who may
have bought the brand in the last two or three months. This exclusivity, apart
from addressing the queries of new consumers, also helps to enhance satisfac-
tion levels and promotes a good word of mouth (WOM). Today, WOM may be
a more powerful weapon than advertising, especially for durables, as consum-
ers look for sources of information other than advertising. This phase should
reinforce the feeling of consumers that they have made the right choice. This is
a basic step for any kind of ongoing relationship program. Reinforcement can
also be brought in through innovative warranties. A futuristic offering will en-
hance the reinforcement model if it offers a longer warranty.
After-sales service is practically an essential feature, and not a differentia-
tor. Hence, service is not treated in detail in any of the phases. The “inactive”
phase is one during which most companies are likely to lose touch with con-
sumers. This is a phase where consumers have begun using the product. The
“novelty” of feeling or experience, has run out. Music systems, washing ma-
chines, watches and microwaves are typical product categories where market-
ers should make an effort to enhance their communication with consumers.
Reinforcement for selecting a brand should probably be stronger in this phase
as the consumer is unlikely to interact with the marketer unless the he/she
faces any problems with the product. A brand of music system like Akai or
Philips can strengthen its equity by providing a periodical catalogue of albums
that are launched by music companies in the form of pre-recorded cassettes
or CDs. The “relationship” essentially starts in this phase as there is a need
to customize offerings based on the interests of consumers. A cross-section of
consumers may be interested in popular light music, a few others may prefer
classical and some others may like pop. This is almost like a service, which
makes the buyers of the music system feel that they have linkages with the
brand they have purchased. Depending on the specific category, these kinds
of offerings have to be formulated. Buyers of microwaves may be interested
in different kinds of food. This can be an opportunity for the brand. Apart
from club memberships, the brand can suggest recipes and provide custom-
ised information based on tastes (as in the case of music system). This phase
also helps marketers to create a database of consumers with a specific focus
on product usage/ associated information. The interaction may also result in
specific product improvements. The database of consumers can be useful for
the firm to carry out market studies as consumers who are in touch with the
company are likely to be receptive towards participating in such studies.
The search phase is an ongoing phase for the consumer. Apart from the
planned search effort, incidental learning also takes place. This is the phase
that the consumer tends to store in the long-term memory, provided he/she is
interested in the product category. The marketer requires only minimal effort
and resources to actively interact and involve a past consumer involved with
the product category. The company can keep the consumer informed about
the state-of-the-art technologies in the market explaining the advantages and
benefits to the consumer. For example, a serious music listener will probably
be interested in the World Space Music System (developed jointly by JVC, Hi-
tachi, Sanyo and Panasonic) that provides several types of music, 24 hours.
The search stage not only enables a company to customise messages for
different segments related to past customers but also helps them to gather
their preferences. A brand like LG or Samsung with their state-of-the-art of-
ferings may be interested in the segment that wants to replace its colour TV.
The search phase usually takes an intense form (as shown in Figure 5.2) just
before the actual replacement phase starts. The interactive aspect takes place
in the “intense search” stage. As the company is in touch with the consumer,
he/she is likely to interact with the company on his/her need to replace the
durable.
The “intense search” phase leads to the replacement phase when the con-
sumer visits the retail outlet to make a final decision. The brand that attempted
to stay in touch with the consumer has to come out with special promotional
schemes (as against the general sales promotional or festival schemes) to retain
past buyers of the brand. The search phase can also be used for cross-selling or
selling other products of the company.
The basics of conditioning principles in consumer behaviour can be ap-
plied across companies over a range of marketing situations.
Building Relationship Programs

The concept of the “lifetime customer” allows marketers to approach custom-
ers with a view to retaining the satisfied ones. A brand can calculate the “life-
time” worth of a customer in a specific segment, based on certain kinds of
primary research. A soft drink brand can be consumed by children, adults and
teenagers in a variety of situations and an estimate of the worth of an average
customer (average calculated on the frequency of purchase) in each of these
segments can be made. Loyalty helps a brand in a number of ways.
Loyal customers are die-hard customers. Research shows that these custom-
ers may not even watch advertisements of competitive brands and this is an
extremely important advantage in an environment of communication clutter.
Loyal customers spread a positive word about the brand. FMCG brands in
developed markets of the world today are interested in quantifying the impact
of the word of mouth—positive or negative.
Research has proved that it is economical for a brand to retain a loyal cus-
tomer, as against procuring and nurturing a new one.
A brand such as Videocon or BPL, which exists in several categories, can
adopt cross-selling with a customer base loyal to the brand. Cross-selling in-
volves introducing and marketing new offerings of the brand over a period of
time to customers who have bought one offering of the brand. A music system
buyer can be led into buying a TV, a microwave oven, a washing machine or
a cooking range.
A company, especially one dealing in durables, may be interested in find-
ing out when consumers upgrade to better products—from a semiautomatic
to a fully automatic washing machine, from a mini-car (like Maruti 800) to a
Zen (a small car) or from a 165 litre refrigerator to a bigger frost-free model.
Keeping customers loyal or building a relationship with them may ensure that
consumers stay loyal to the company for the “upgrades”. Setting up a well-
structured database, formulating loyalty schemes and monitoring satisfaction
levels of consumers over a period of time are some useful strategies. Even in
the case of consumables, sustaining consumers and enabling them to upgrade
to better products may be profitable for a company that has a long product-
line. Detergents, soaps and toothpastes may be some categories where this
kind of approach is useful.
In markets that experience demand saturation, loyalty brings in revenue
in the form of after-sales service contracts. Otis gets a significant portion of its
revenues in the Western markets through such contracts. Copier is one more
category in which after-sale revenue is significant.
Segmenting Customers on Profitability

Differential marketing (DFM), advocated by Hallberg, proves that all consum-
ers are not created equal. The fundamental questions that a company should
take into consideration are:
 What percentage of consumers contributes to profit?
 What is the frequency of purchase of these profitable consumers?
 Can a part of the advertising budget be spent on profitable consumers in
the form of reward programs or direct marketing?
 Is it worthwhile covering the entire segment with mass media? What are
the psychographics of profitable, frequent buyers/users of a product or
service?
Clearly, this approach is different from the traditional one. An airlines com-
pany may find that a small percentage of consumers contribute to a large por-
tion of profits. The psychographics of frequent fliers, for example, help the
airlines formulate promotional programs. The airline may find that most of the
frequent fliers buy designer clothing. This can lead to a collaborative promo-
tional effort with a designer-wear manufacturer. Such a move will provide an
added appeal when competition follows suit.
Apart from the profitability aspect, the profile of consumer segments
may be important, especially for products with a low penetration. Hot choc-
olate drinks (like Drinking Chocolate from Cadbury's), which are different
from brown-malt drinks (like Bournvita) have a low level of penetration
despite being in the market for several decades. Consumers may buy such
a product for purposes other than consumption as a drink – such as for use
as an ingredient in a recipe. Regardless of why the product is being bought,
the marketer should know the demographic as well as the psychographic
profile of consumers, because nurturing and sustaining the loyalty of buy-
ers is essential to expand the consumption of the category itself. A pioneer-
ing brand has the advantage of building itself along with the expansion of
the category.
The Impact of Customised Communication—a form

of reward
As a market expands, different needs emerge from different kinds of custom-
ers. Companies usually take care of this aspect by offering variants of the prod-
uct. A cosmetics company marketing creams may have a plain cream, moistur-
izing cream and a herbal variant. This enables consumers to try out from the
range and select a product suitable for their skin type. Creating awareness
on skin types, the problems associated with skin and the impact of seasonal
variations on the skin may be some important aspects that need to be commu-
nicated even before consumers consider buying the variants.
Communication in this situation is time-oriented, sequenced and may even
become customised after a stage when an individual consumer starts looking
for specific advice on skincare. Special efforts are required by a company to
formulate communication. This includes not just information on skin types
but also the right kind of appeal for the products offered by the company.
Besides, communication will also have to take into account the timing for in-
troducing the brand during the different phases of communication with the
consumer.
The communication involved in the relationship-building exercise is differ-
ent from one that happens through mass media. A brand of cosmetic target-
ing young teens in urban markets can create a Web site and carefully involve
consumers who are highly involved in skin care with a variety of information
on skin care. This advice can also be customised to each consumer. Reward (in-
strumental conditioning) need not be only associated with freebies or money:
timely advice on several perceived risks associated with a category may also
be perceived as a reward by consumers. Such consumers are likely to become
loyal to the brand.
Loyalty Programs
A company interested in loyalty programs should consider transaction and
non-transaction methods of building loyalty. This may depend on the specific
product or service category.
For example, customers are likely to choose an airline that offers the
most attractive frequent-flier programe. There are product categories where
consumers may like to get as much information as possible on usage and other
aspects. This is applicable in the Indian context where an increasing number
of consumers are attempting to be aware of buying and using several products
they have not been exposed to.
Health supplements (like spirulina), branded nappies, branded baby foods,
mouthwash and fast food are some examples that require intense information
that is backed up by credibility. Consumers may be concerned about the fre-
quency of use/intake, or the nutritional ingredients used. This offers tremen-
dous scope for marketers to provide information to prospective consumers,
which in turn, wins their confidence and builds goodwill.
Consumers may begin to perceive that the knowledge base provided by a
company reflects its concern towards its consumers. Non-transaction based
loyalty programs provide the basic foundation for transaction-oriented re-
ward schemes. They emphasize that the brand/company is not just a price
warrior, but one that is aware of the kind of customer orientation which is
required in the category.
Pricing and Loyalty

A limitation of heavy sales promotion is that consumers are inducted into a
“price war” mindset. This may prove counter-productive in loyalty-building
as consumers tend to pick up the cheapest brand in the market or the one that
is offered under similar sales promotion (price-off or a free gift with purchase).
Soaps, toothpastes and noodles are some examples.
While sales promotion, by itself, may be an effective tool, a brand will have
to carefully plan the objectives of sales promotion, taking into consideration
the loyalty objectives. This may not be done by most brands.
A large company marketing a brand of noodles (with a considerable
amount of brand-building efforts) can use relationship pricing through cross-
selling of other fast food products made by the company. This is different from
sales promotion. A combination of units purchased across product categories
over a period of time and the resultant savings, besides contests, provide a
useful relationship program. This need not be a short-term benefit since the
consumer would be motivated to buy offerings of the brand by factors other
than those provided by price. The underlying assumption in such programs is
that the products are good. Loyalty programs must be planned using informa-
tion on the various segments of the product/ product-line and the correspond-
ing demographics and psychographics. In the Indian context, a major chunk
of sales happens at small retail outlets unlike in the departmental stores of the
West where a number of data-capturing tools are used to obtain valuable in-
formation on consumption patterns.
Hence, companies have to make efforts to collect the required data before
attempting to formulate programs. It may be possible to collect such data in
the case of durables if a company has a proper system to follow up and track
customers after the sale is over. Marketers can explore unlimited possibilities if
they synergize databases and loyalty patterns to develop relationships.
Consumer Behaviour and Information-Processing

There is another school of thought on learning—the information processing
theory on learning or the cognitive theory on learning, which is based on men-
tal activity. The basic assumption of this theory is that consumers are likely to
search for relevant information and get involved in complex problem-solving
with regard to their needs. Consumers may process information on attributes,
brands, product categories or a combination of these aspects. Individuals also
have a different orientation towards imagery—the ability to form mental im-
ages. A marketer can research the target segment before formulating adver-
tisements focused on consumers in the target segment. The research can deal
with (a) tests of imagery vividness, which are concerned with the ability of
consumers to evoke clear images; (b) tests of processing style, which are con-
cerned with the preference of consumers towards visual or verbal messages;
or (c) tests of daydreaming, which are concerned with the fantasy context.
The utility of such research can be explained by the fact that specific guide-
lines to the advertising executives can be formulated. They would deal with
questions like “Should the advertisement for a brand of soft drink contain at-
tractive visuals based on a high degree of fantasy element or should it have a
tuneful jingle or both?” The impact of media on the target segment would also
have to be researched. The information processing theory is based on mental
processes rather than on the strength of associations, which form the basis of
behavioural theories.
Important Aspects of Information Processing Theory

There are certain critical aspects of the information processing theory and each
of these have an impact on the behaviour of consumers and also on the formu-
lation of marketing strategies (Figure 5.3).
INDIVIDUAL
Memory Complex Mental

Processing
Need/
Problem
Environmental Problem
Solving
Capacity
Figure 5.3  Basic Aspects of Information Processing Theory

Sensory Store Stimuli (sensory information, which acts as inputs to our

senses) from the environment enters the sensory store in the memory. Senses
together do not transmit complete messages to the brain. Each sense receives
only one part of the information (sound, colour, touch, etc.). Perception takes
place in the brain and the individual perceives the complete image. The im-
age in the sensory store lasts for a few seconds and is lost instantly if not pro-
cessed. Hence, the individual's current interests and motivational pattern may
filter out a plethora of information not required by him/her. While it may be
possible to gain entry into the sensory store with catchy and creative advertise-
ments/visuals, it may be difficult to make a lasting impression on it, given the
clutter of communication in today's context. These aspects have a number of
implications for marketers. The right media have to be selected to ensure that
the target segment gets interested in the communication after being impressed
by the visual. However creative an advertisement for a foreign vacation may
be, it would not hold the viewers if advertised on a wrong TV channel. While
the viewers may appreciate the creative aspects of the visual, a large chunk of
viewers of the TV channel may not even fall in the demographic and psycho-
graphic profile of the target segment. A niche channel like Discovery or Star
may be a better choice, as the interest levels triggered off by the advertisement
in the sensory store will ensure that the context of communication moves on to
the next stage of the memory.
Companies with seasonal products like soft drinks or textiles, (which may
be bought more during festive seasons) can have special communication strat-
egies that may be of interest to the target segment—something like a sale/
contest. This will be different from the regular campaigns of brands in terms
of the brand personality aspects. A TV channel may use humor during such a
campaign. This can have an additional impact on the sensory store in terms of
its “attention-getting” power. In-store displays like the ones at POP and even
the location of brands (especially, new brands in a category) are other aspects
that are connected with the sensory store.
Short-term Memory When an individual gets interested in the contents

that go through the sensory store, the information is moved into the short-term
memory. This is the working memory, and the information to which attention
has been paid is stored here. While a consumer may readily recognize the logo
or brand name because of its familiarity, the short-term memory examines the
stimuli for its meaning. A consumer interested in soft drinks may recognize
the brand name in the sensory store and may become interested in the lemon
or grape variant of the brand because of the impact of the stimuli on the short-
term memory.
Short-term memory can hold only limited (and distinct) pieces of informa-
tion. The process of evaluation of information with regard to its relevance to
the individual is very brief and takes place within 30 seconds. If the informa-
tion is not evaluated within this time, it is forgotten.
The implication of short-term memory for marketing communication is
interesting and useful. In order to transfer the information from short-term to
long-term memory, the short-term store undergoes a process called “rehearsal”,

which is a silent, mental repetition of information. This memory contributes
significantly to the “top-of-the-mind” recall of brands. This characteristic is ex-
tremely useful for FMCG brands that have a strong brand image. Close-up in
toothpastes, Red Roses in tea and Surf Excel in detergents are strong brands
as they are generally advertised throughout the year. When brands (or logos)
are advertised continuously, the “top-of-the-mind awareness” is enhanced
and there is a probability of the information getting transferred to the long-
term memory. Hence, the very thought of a product category can trigger a few
brands in the mind of the consumer. These are likely to be the strong brands
as the ones mentioned above. Some may be pioneering brands like Pepsi and
Coke, which are spontaneously associated with the cola category of soft drinks.
Building brands is also useful in evoking the “experience imagery” associated
with a specific brand—a process by which information from long-term mem-
ory appears in the short-term memory. For example, the very mention of Cad-
bury can evoke the shape, taste and color associated with chocolate.
Long-term Memory This memory has the capability of retaining infor-

mation for a long period of time. The information that enters this memory
keeps getting organized and reorganized as new information enters the mem-
ory. Information gets updated with appropriate linkages when new and rele-
vant bits (with regard to a specific domain—product categories or brands in
the marketing context) of information get into the memory. The process of ac-
tivation links new data to the old information stored in the memory.
Another distinguishing feature of this memory is “schema” or a total pack-
age of associations brought into an individual's mind when he/she feels a
stimulus. The stimulus can be an advertisement or simply a need felt by the
individual.
Marketers can use long-term memory and schema in a number of ways.
The following points will enable them to appreciate the value of long-term
memory in analyzing or shaping the behaviour of consumers:
 Consumers can have a schema for product categories, brands or even re-
tail stores. Different consumers may have a different schema for different
product categories. A type of schema for soft drinks is shown in Figure 5.4.
 As brands begin to pack a new product category, the effectiveness of the
USP of the new product decides how the brand will impact the exist-
ing schema in the mind of the consumer. If a new brand of cola is to be
launched, marketers should consider how it can enter the existing schema
for soft drinks. Red Bull created the “energy” association with regard to
soft-drinks in the schema of consumers.
 When a “new concept” product category is being created (electric cars or a
tablet-based soft drink), the pioneering brand has an opportunity to become
an inherent part of the relevant schema. Hence, such a brand should strive
hard to build itself. Though Titan was not a pioneering brand in the digital
category of watches, it is a very strong brand in terms of associations.
Soft Drinks
Aerated Pure Fruit Soda

Juice Drink
Cola Orange Lime Branded Home-

Made
Tropicana Flavours
Coke Fanta Limca Frooti Jumpin

Pepsi
Figure 5.4  Schema for Soft Drinks

Note: The schema is only illustrative, and several combinations are possible in the
psyche of the consumer
 Marketers can explore gaps in the minds of consumers to formulate an

appealing USP. For example, Promise toothpaste used clove oil as its USP
when it launched the brand. This made a tremendous impact on consum-
ers. (The example is used to illustrate the concept rather than to analyze
the brand.) Maggi used the convenience plank to get into the minds of
consumers. Care should be taken to ensure that the USP so formulated
appeals to the target segment. Being unique is one thing and making the
consumer buy the brand is another. Hence getting into the schema should
be done with the overall objective of influencing the purchase decision of
consumers. The USP of a brand has to be unique, relevant, acceptable to
and identifiable for the target segment.
 A well-known scooter brand of the yesteryear was positioned on the com-
fort plank. The visual of the advertisement showed the brand being used
for countryside rides. While the positioning was effective in conveying
the “ultimate experiential comfort” (and probably making an impact on
the existing schema for scooters), it is doubtful if prospective consumers
would have identified themselves with the idea of using a scooter for a
countryside ride, especially when the visual did not have an adventurous,
young person. The example is an old one but reflects the importance of
formulating a USP from the viewpoint of the schema.
Encoding and Information Retention

Encoding is the process by which an individual selects a word or visual
image to represent the perceived object. Brand symbols/logos are extremely
useful elements from the viewpoint of triggering recall, especially for well-
established brands. Shell, Mercedes and Dettol are examples of how logos
are useful in information retention. Individuals can assign a visual/picture

(iconic) or words (echonic) to represent the perceived object. The following
aspects concerned with encoding will be useful to marketers when they for-
mulate communication strategies:
1. There is a need to research among the target audience on the impact of
the visual vis-à-vis verbal components in an advertisement. This can dif-
fer from one product category to another (a brand of FMCG can call for a
different approach, from a brand of TV).
2. There is research evidence to show that TV viewers can commit a
large portion of their thought and involvement to specific parts of the
program(s) they view. Hence, apart from introducing TV commercials
at prime time (when viewership is large) for an appropriate brand, mar-
keters can also research the TV program or serial and pretest it among
a cross-section of the target audience. This will enable them to get some
idea about the degree of involvement viewers have in a program. This,
in turn, will help them place the TV commercial “adjacent” to “high-
involvement” parts of the program.
3. When consumers are exposed to a lot of information (as in the highly-
crowded FMCG product categories), they are likely to experience “infor-
mation overload”.
Research is inconclusive on how much information consumers can handle
when brands disseminate it. Marketers can determine the point where infor-
mation overload occurs with regard to a product category in a specific me-
dium. For example, marketers can find out the impact of brand advertising
of toilet soaps on TV. This helps them decide on alternative or supplementary
strategies with regard to encoding. If the consumers find it difficult to encode
information about a new brand of herbal soap on TV, marketers may choose
point-of-purchase material as having a better impact. This can be useful, es-
pecially for new brands entering a category, which already has strong brands.
Retention and Long-term Memory Long-term memory has two ways

of storing information. It can store information episodically, (which is accord-
ing to the sequence in which events take place) or semantically (according to
relevant concepts). An individual may remember the various brands of he/she
may have used during different stages in his/her life (based on episodic com-
ponent) or remember how specific brands are useful for specific purposes (or
end benefits) depending on their features (based on semantic memory). Epi-
sodic memory is also known as “autobiographical memory” as it records one's
experiences in the world. Research evidence shows that a pioneering brand
in any category will have an impact on consumers with its novel and unique
features. A pioneering brand may also have an edge over the other entrants in
terms of its impact on consumer psyche because of episodic memory. This may
not always happen in practice, as there are a number of other factors which
must be considered while evaluating a brand's success. Follower brands may
be successful because of enhanced marketing mix elements. (Maruti, Titan and

Compaq were not pioneering brands). The inference is that a pioneering brand
in a category can sustain its success if it can fine-tune its marketing mix ele-
ments over a period of time. Reynolds is one such example.
Semantic memory gets organized when there is activation or when new in-
formation gets clubbed with stored information to result in meaningful chunks
of information. Brand comparisons take place because of semantic memory.
Another implication of semantic memory is that the consumer is also able to
fulfill his/her needs (since organization of information happens according to
meaningful concepts). A consumer may prefer a car brand because of certain
specific features that match his/her needs. This is meaningful to the consumer
and, hence, the brand gets into his/her memory.
Retrieval of Information
Retrieval is the process by which individuals are able to recover information
from long-term storage. Research suggests that consumers remember the ben-
efits rather than the attributes of a brand (there can be exceptions like the “puf”
used in refrigerators). Godrej made use of this attribute to make a significant
impact on the psyche of potential consumers. There are two causes that inter-
fere with the retrieval process. Recently-learned material or retroactive learn-
ing can interfere with the retrieval of previously learned material; and material
learned earlier or proactive learning, can interfere with the retrieval of newly-
learned material. The implication is that marketers should provide effective
“retrieval cues”. These cues can well enhance the effectiveness of advertising
campaigns, especially over a period of time. Consumers may like advertise-
ments but the respective brand has to be recalled when they make a product
choice, especially at retail outlets. This is very essential for FMCG products
where there is a proliferation of brands. Soaps, tetra-packed drinks and food
are categories where cues may be very effective.
Life, a brand of cereal in the US, used a method which provided a strong
retrieval cue—a photograph from a certain TV commercial of the brand was
used on its package. Point-of-purchase material, which is associated with TV
advertising can also be provided at the retail outlet.
A relevant contrast provided in a TV commercial can also be an effective way
to trigger off recall among consumers. Itch Guard, a brand for skin-infection
ointments used good contrast by introducing humor. It showed a man in plush
surroundings feeling itchy and wriggling due to an infection, toppling things
around and interrupting the proceedings. The context of the advertising theme
is the traditional “bride visiting” ceremony
Priming is another technique that can provide strong retrieval. It is a pro-
cess of triggering the schema in the psyche of the consumer by using one of
its aspects. For example, a brand using comparative advertising can trigger
off several brands and their attributes or benefits. Santro used this technique.
A brand should use priming only if it is sure of gaining a competitive edge
over other brands. Prior research is a prerequisite for using priming. Another
method of using priming is to highlight a problem that can trigger off associ-
ated problems. The brand can, then, convey how to solve or avoid the problem
(Surf Excel's stain removal campaign involving two children who playfully
fight with one another, is an example). Even services can make use of this tech-
nique. A brand in the category of insurance can show a powerful visual, which
may trigger off several aspects related to the benefits of a policy.
Other Aspects of Retrieval: Prototypicality is a concept that may result

in high recall of an advertisement. Consumers tend to remember a brand if
it is positioned as an ideal product in the respective product category. Proto-
typicality can be applied by brands that offer to have an edge over competing
brands in the category and also to have pioneered a product in a category or
sub-category. For example, Maruti was the typical “small” car when it was
launched with several aspects that are associated with a small car—initial cost,
fuel economy, compact looks etc. The entry of Santro, Indica and Matiz, made
Maruti a “mini” car. Dove, the brand of moisturizer bar, which pioneered this
product, is another example of prototypicality with regard to moisturizer bars.
Brands entering the market with liquid detergents (a few brands have been
in the market for a long time) and shower gels (a few brands have attempted
to make a mark in the market) have the opportunity of creating prototypical
brands in the Indian context.
Salient attributes in a product category are recalled better. Hence mar-
keters need to research on them for a given target segment of consumers.
These depend on the goal consumers have while choosing a product/service.
McDonald, the world over, is associated with fast food, good value, conve-
nience and hygiene.
Recall of experiences is an effective way to enhance the recall of a brand.
Constant research is required for an insight into the motivational aspects of
consumers. In certain markets, consumers may have the desire for new prod-
ucts that look like old products. This can contribute to the style and looks of
new products in the pipeline and these in turn, can have a positive impact on
the recall of the brand. A brand of health drink can position itself as a drink of
“simple and happy times”, making it a family drink.
Congruence is another concept that contributes to a high degree of re-
trieval. Congruent associations establish strong linkages and lead to effective
retrieval. The words “refreshing”, “emerging” and “recharging”, when used
for a soft drink for sportsmen, may be effective because of the congruence in
the words.
Redundancy is a variation of congruence and a process that enhances
memory. This occurs if information that has to be learned has visual and
copy elements that fit together. Hence, the recall of a brand name, advertis-
ing message and pictures can be enhanced if they have similar or common
elements. The similarity in verbal and visual message is encoded both ver-
bally and visually. This results in two retrieval paths. A brand name–Frooti–
can have a visual of fruits and the copy can talk about the fruits used in the
drink.
Mood, or a temporary emotional state, has an impact on retrieval of in-

formation. A positive mood enhances recall of positive information and vice
versa.
Split-Brain Theory
The split-brain theory emphasizes, that the right and left hemispheres of the
brain process different kinds of information. The left is concerned with ac-
tivities like reading, speaking and other verbal aspects, while the right takes
care of non-verbal and pictorial information. TV viewing is concerned with
the right side and, hence, learning is passive. Due to the visual element, the
information processing occurs in a low-involvement environment as against
the information processing which occurs in print, a high-involvement media.
The split-brain theory has a number of implications on consumer be-
haviour. It says there are high- and low-involvement consumers; high- and
low-involvement purchases and that there are a number of purchasing factors
responsible for the involvement levels. A television and facial cream may both
reflect high-involvement buying, as both the purchases involve financial and
social risks respectively. The medium of TV becomes important for conveying
symbols, brand logos or short visual messages repeatedly. Visual cues enhance
brand recall. Marketers should research the involvement profile of consumers
to get an idea about the target segment's interest in the product and its ben-
efits, consumers' perception of its associated risks and the symbolic nature of
the respective product category/brand.
Learning theories and concepts offer a number of creative avenues for mar-
keters and advertisers.
Touch of Reality
Old Brands and New Communication – Applying
Learning Theories
The application of learning theories along with appropriate marketing
research to find out the relevance of visuals/copy can be useful to old
brands with which consumers are familiar. Some of the old brands may
trigger strong brand recognition, but consumers may not have used
them and hence forgotten about them (though, at some point in time
they may have been familiar with them), or they may have perceived
a weak link between the brand (stimulus) and the benefit of the brand
(reward). Forgetting a brand is decay and a weakened link between stimu-
lus and reward is known as extinction. This can happen to a number of
well-established brands over a period of time, when a number of new
brands enter the category. For example in the category of antacids, cur-
rently there are several offerings of tablets and liquid forms available in
the market. Eno is a well known brand in the context and the brand has
been in the market for several decades. In an effort to reposition itself,
Eno came out with an interesting campaign that repositioned the tablet
and liquid variants in the category of antacids.
The TV commercial showed Eno in comparison with a tablet and a
liquid (both unbranded ones) and explained how the offering is more
effective than the other two variants. The sensory store may be receptive
to the old brand that is familiar to consumers, and consumers may rec-
ollect the advertisement (if repeated frequently) when they have a need
for it, from the short-term or working memory. When the consumer is
exposed to such communication over a period of time, the brand name
may enter the long-term memory (the process by which consumers are
familiar with several brands like Lifebuoy, Titan, Cadbury or Dettol).
The relief (benefit) experienced by consumers on using the offering will
further strengthen the brand's association with the need and benefits of
the offering.
Strengths of Brand Associations

The following are some examples of how brands have built up their asso-
ciations. It should be noted that as a result of classical conditioning (in the
form of associations), brands create a focused perception in consumers.
To that extent, classical conditioning is linked to perception (though for
conceptual purposes of comprehension, these two are treated as distinct-
ive academic concepts).
 Margo brand of soap's associations with neem (which is considered
good for the skin) over several years (later endorsed by a celebrity).
 Café Coffee Day's associations with relaxation and socializing
 Robin Blue's associations with whiteness of clothes
 Rolex and Omega watches with the prestige of the consumer owning
them.
 Nike's associations with a youthful attitude
 Saffola's association with healthy cooking oil (Refer Plate 8)
 iPhone's associations with technological trends and fashion
 Lux soap's associations with celebrities for several decades.
6
The Role of Motivation and

Personality Dimensions in
Brand Associations
Needs, motivation and personality are related concepts and it is appropri-

ate to consider them together. Need is a state of deprivation that produces
discomfort. Motivation is the drive which impels a person to achieve his/
her goals. Personality is a set of inner characteristics that enable a person to
decide how he/she should consistently respond to the environment. Motiv-
ation and personality are linked—a person with a high degree of confidence
may be assertive. There are a number of theories on personality. The Freudian
theory assumes that the behaviour of individuals is based on unconscious
needs and drives. Accordingly, human personality consists of three parts—
“id”, ego and super ego. “Id” is the component that consists of impulses and
primitive instincts that urge an individual to seek immediate gratification.
The thoughts associated with “id” are primitive in nature and are associated
with baser instincts. A number of product categories, which may not have
well-defined functional attributes and are oriented towards sensual pleas-
ure, formulate communication which may appeal to “id”. Perfume, cigarette,
liquor and condom are some categories, which are oriented towards the usage
of appeals with baser instincts. Black Knight and Bacardi brands from the
liquor category adopted “id”-oriented appeals when liquor category was ad-
vertising in India. The categories mentioned have an association with “id”
in several parts of the world where these are advertised. Liquor brands may
resort to surrogate advertising and use “id”-oriented appeals to the extent
permitted by a society.
Surrogate advertising involves the marketing and advertising of categories
with brands that are not permitted to be advertised in a social context (a li-
quor brand advertising the same brand in the mineral water category, is an
example).
There are two kinds of needs—primary and secondary. The primary ones
are physiological needs like thirst, hunger and sex. The secondary needs are
acquired, like a sense of belongingness, status and self-esteem. Consumers
may not consciously know their secondary needs and it is in this situation
that the symbolism associated with brands may appeal to consumers. Louis
Philippe and Park Avenue in apparel, Mercedes in automobiles and Fastrack
in watches are some examples that reflect a consumer's symbolism. Consum-
ers, by associating themselves with these symbolic brands, are able to gratify
their psychological needs. Various research methods are deployed to probe
such needs. Liril soap was launched in the seventies after a research agency
found that housewives had a distinctive need for fantasizing when they have
their bath. The Liril advertisement captured exactly the experience of indulg-
ing in a bath. The water-fall, the greenery around, and the model indulging in
fresh water was in synergy with the lime soap offering freshness and a refresh-
ing experience, the green packaging of the brand and the image of lime on
the advertisement (TV commercial). The example reflects how psychographics
and brand proposition can be creatively combined for brand success. Liril was
very successful for several years after such a brand positioning (the focus is on
the concept rather than on the performance of the brand).
Multiplicity of Needs
Normally consumers have more than one need, and analyzing the multiplicity
of needs (with their importance) provides insights for marketers. A buyer of
“no-frills” Maruti may be interested in the brand because of its low price, fuel
economy and comfort, but the low price may be the pre-potent need, which
will take the brand into the “consideration set” of consumers.
Types of Goals
Goals can be positive or negative. Behaviour is directed towards a positive
direction (approach) or away from a negative direction (avoid). This concept is
useful when the unique selling proposition (USP) is researched. For example,
do consumers want white teeth or prevention of decay from their toothpaste?
The choice of the product's (in this case the toothpaste's) USP is a decision that
a marketer needs to take, and the concept of goals is likely to be useful in this
situation. Axe's (deodorant) advertisement (TV commercial) shows the image
of a pig and the communication is oriented towards the behaviour of an indi-
vidual avoiding the negative direction (of smelling bad).
Extrinsic and Intrinsic Needs

Needs, from the viewpoint of application to a practical context, can be classi-
fied as extrinsic and intrinsic. Extrinsic needs are those that motivate an indi-
vidual to achieve the end result. Buying a status symbol (designer watches or
6  The Role of Motivation and Personality Dimensions in Brand Associations 167
furniture) to impress others is associated with extrinsic needs. If an individual

buys a car for his/her won comfort and enjoyment, it is associated with intrin-
sic needs. It is worthwhile to find out the linkages between intrinsic and extrin-
sic needs before a communication package is formulated for a brand. Table 6.1
explains the concept of examining the linkages between the two needs
Table 6.1  Intrinsic and Extrinsic Needs for a Brand of Television
Intrinsic Extrinsic
Aesthetic appeal Gratification on the offering Status symbol
and premium-ness (TV) and affordability
Sound quality Sensual pleasure Appear as an (state of the art)
innovator
Brand equity (associated) Reassurance (perceived risk) Symbolic association
Special features Variety-seeking tendencies To encourage word of mouth
about self
The list of needs provided in the example is suggestive and illustrate the
concept. In-depth research is required to find out the degree and importance of
these needs. This is useful to select a brand's associations with the chosen USP.
For example, Cielo's (the brand of car that was launched years back before the
passenger car segment in India became very competitive) imagery was of a
man who expressed his own happiness (intrinsic) at procuring the brand after
achieving success (extrinsic). This example typically involves both intrinsic
and extrinsic motives.
Perceived Contradictory Motivators

Research has shown that the manner in which consumers perceive market-
ing communication has important implications for marketers. If fast foods cat-
egory is considered as an example, “healthy” and “fast” (or convenient) may
be perceived as “tasting bad” and oriented towards “laziness”. This ambiguity
is referred to as “trade-off motivators” and marketing researchers may probe
such propositions with a view to unearthing such insights.
Self-Concepts and their Implications

In almost any category of consumer products, symbolism makes use of the
concept of “self”. Self-concept is the image an individual holds of himself/
herself that includes various associations about self. There are a variety of self-
concepts, which are useful in marketing communication. They are:
1. Actual self-concept: It is the way the individual perceives himself/herself.
A group of consumers may perceive themselves as rebellious non-con-
formists who seek individuality and freedom in their lifestyles. Charms
cigarettes was, perhaps, one of the earliest brands in India to create a

brand personality using the power of self-concept. “The Spirit of Free-
dom” and “Charms is the Way You Are” were some of the copy state-
ments in the advertisement featuring young models. In order to add to
the claims of freedom they had packaged the brand in denim style pack.
This was around the time when denim was getting accepted in India for
its functional and symbolic appeals. The lifestyle type of advertising and
the symbolism of jeans association, normally associated in the West with
casualness and freedom, made the brand an inherent part of the youth
culture during its time. The brand used the actual self-concept and/or
the others' concept of a person.
2. Ideal self-concept: It is concerned with how an individual would like to
ideally perceive himself/herself. The thin line of difference is that the ideal
self-concept is based on a future aspiration, deeper than the active self-image.
The individual perceives the ideal image of the self based on aspirational
needs and this depends on the individual's financial and educational sta-
tus, upbringing, exposure and personality traits. An upcoming business-
man who is driven by aspirations may buy the Tag Heur brand of watch
that may be associated with globe-trotters, certain exclusivity and even
an up-market sport. There may be a variant of this self-concept in the
form of “others' ideal-self concept” (how others should ideally perceive
an individual). The individual may use the status symbol to impress oth-
ers (others' ideal-self concept) but may resist from doing so if it is a situ-
ation in which he/she feels others do not matter (personal discretionary
time, leisure, etc., vis-á-vis professional work). Marketers can use such
psychographic information with time styles (how individuals spend their
time) to come out with appropriate appeals for products and services
(vacation and weekend cars are examples of categories where the kind of
orientation is likely to be useful).
3. Expected self-concept: It is midway between the actual and ideal self-images.
It is likely to be useful to marketers because changing the actual self-image
radically to the ideal image is difficult and has a strong aspirational elem-
ent. The expected self-image is one, which consumers can identify with.
A typical example is the advertisements of computer educational institutes,
which attempt to draw prospective consumers for their courses. Though
there is an element of aspiration, consumers feel it is a stepping stone (the
course leads to a job) rather than the realization of their dreams (the ultim-
ate ideal self-image). For a given target segment, short-term aspirations may
reflect actual self-concepts and long-term ones, ideal self-concepts.
Inner-directedness and Other-directedness

There may be broadly two kinds of consumers: inner-directed and other di-
rected. Inner-directed consumers look to “themselves” for following a specific
lifestyle, formation of attitudes towards product categories and brands and in
general, for purchase decisions. Other-directed consumers are influenced by

their peers, neighbours, and aspirational groups with whom they interact on
a regular basis. Sprite, the soft drink that positioned itself as a “non-pseudo”
drink, is targeted at inner-directed consumers. Other-directed brands are those
that strongly emphasize the group and symbolize others' self-concept orien-
tation. i10 from Santro that connects with the young target segment, the old
advertisement of Onida (“Neighbor's envy : owner's pride”) and the “status”
factor associated with the various mobile phone brands, as reflected in the
advertisements, are examples.
Personality Traits and their Applications

Traits are enduring and distinguishing. They are helpful to marketers in a va-
riety of ways.
Consumer Innovativeness This aspect of personality may be useful for

both FMCG products and durables. It enables marketers to identify and target
consumers who are receptive to new-product categories. A number of new-
product categories are getting introduced and these benefit from identifying
the innovators. Mobile phones, electronic toys, plasma TVs, worldspace mu-
sic systems, special types of watches like Ecodrive from Citizen and electric
cars are some categories which may benefit from the identification of innov-
ator profile. Innovators also form a good base of consumers who spread the
word about the category or brand by talking about it. There is a need to ensure
that innovators are not only satisfied with the product but also with the ser-
vice that is packaged with the product. It may be worthwhile for marketers
to find out if these consumers perceive the benefits offered by new product
categories. For example, products like three-in-ones (transistor, tape-recorder
and record player) introduced in the late sixties/ early seventies did not catch
up even though a few innovators bought this product. With small differen-
tiation in the cola market, a brand may come out with a cola fortified with
vitamins, and one of the success factors will depend on the “buzz” generated
by innovators.
Ethnocentrism Ethnocentrism is the tendency of a consumer to prefer

products “made in my country” vis-à-vis a foreign product. Ruf-and-Tuf jeans
is a good case of a brand attempting ethnocentrism. Consumers have been
used to a number of foreign jeans brands. Arvind Mills, which launched Ruf-
and-Tuf found that the aspirational levels of consumer groups in semi-urban
areas were high but they could afford to buy only cheap clones/duplicates of
well-known brands. There was a need for a good quality brand at affordable
prices. Ruf-and-Tuf was launched with a celebrity endorsing it and the brand
followed this up with a campaign that emphasized its ethnicity. The campaign
was effective in ending the perception that only foreign brands had quality in
the category of jeans. The brand was priced with penetration pricing, tailors
were trained and roped in to tailor the jeans (as against readymade jeans) and
the product itself was presented in a unique manner (the fabric plus other ac-
cessories were given as a set). Though the discussion about the sustained suc-
cess of this brand (as a fabric tailored by tailors) is beyond this chapter's focus,
the example reflects how marketing mix elements back a positioning based on
“ethnocentrism”. Bajaj came out with the “Hamara Bajaj” campaign during
the nineties when it found that the market was getting very competitive. The
“Hamara Bajaj” campaign made use of the popularity of the brand throughout
the country.
Optimum Stimulation Level The intensity of physical or mental or

sensory activity an individual experiences is referred to as the stimulation
level. Due to the differences in personality and lifestyles, individuals vary in
the stimulation levels they experience. Individuals with a high level of stimu-
lation are likely to find ways to reduce stimulation levels and individuals
with a low level of stimulation are likely to attempt to increase their levels of
stimulation. The marketing implication is explained through the example of
vacation packages that range from high adventure to ones offering tranquility
and peace.
Another application of stimulation levels can be associated with the man-
agement of product-lines in FMCG categories like biscuits, chocolates, tooth-
pastes and, even cigarettes. One of the objectives of launching variants of brands
(in the form of flavours and tastes) is to ensure that consumers do not change
their brand. It may be worthwhile for a brand to find out through research if
loyal consumers need variety to gratify their stimulation levels. Revenue from
variants is carefully managed for product-line profits and stimulation levels
of consumers are worthwhile to be considered. The concept can be further
explored with a trial of variants in consumables to check if it answers the ques-
tion “Do consumers who are highly stimulated try out more of variants in a
specific product category?”
Dogmatism This refers to a trait that is responsible for the individual's re-
sistance to information which is not in tune with his/her beliefs. Consumers
who are not very dogmatic are likely to be more open to marketing commu-
nication than those who are. Exploring the cognitive attitudes in the target
segment is useful to marketers, especially before they formulate broad com-
munication. For instance, among the target segment for water purifiers there
may be some who strongly believe the process of purification is likely to be
hazardous to health. This kind of belief has to be carefully dealt with, using
a combination of promotional methods like advertisements, personal selling
and, perhaps, demonstration with sophisticated methods and research data.
Permission marketing, which involves creating an involvement of the con-
sumer (by obtaining his consent towards receiving information about the com-
pany's offering), is likely to be effective in providing a foundation for commu-
nication and reducing the dogmatism. From among the target segment for the
water filters, it may be useful to gather data on how many are interested in ob-
taining information on the brand, which also includes the kind of information
addressing wrong beliefs. If the brand is able to communicate effectively to
the selected cross-section of consumers, there are chances that word of mouth
will take over and the positive effects of word of mouth will be associated with
the brand. This approach is likely to be more effective than a high-visibility
campaign that directly attacks the dogmatic beliefs of consumers. Advertise-
ments may become counter-productive if they generate counter-arguments in
the psyche of dogmatic consumers. Consumers may feel that the brand is at-
tempting to force itself through an advertising blitzkrieg.
Figure 6.1 reflects the different stages involved in addressing dogmatism
among prospective consumers. Apart from research results, other kinds of
“credibility” models like doctors and scientists who are noted for their emi-
nence can be used, to address the dogmatic consumer.
Importance of Cognition This refers to the consumer's orientation to-

wards the marketing communication associated with brands/categories. Con-
sumers who have a high need for cognition are likely to respond favorably to
marketing communication that is high on product-related information. These
consumers may not be as responsive to peripheral cues of marketing commu-
nication like a jingle or model in a TV advertisement. Researching consumers'
need for cognition will be useful for marketers as the insights gained will help
formulate communication strategies. This aspect of the consumer's personal-
ity will be useful for consumer durables. Given the type and variety of tar-
get segments in a number of categories of durables, a marketer may have to
Researching dogmatic beliefs
Getting the involvement of

consumers
Demonstration
Research results Customising communication
“Credibility” models
Reducing dogmatism and

changing beliefs
Triggering the word of mouth
Figure 6.1  Dealing with Dogmatism

decide on specific strategies for each segment. For example, in the category
of washing machines, the semi-automatic one is likely to attract a target seg-
ment that is not interested in the upper-end “fuzzy logic” washing machines.
Research information can give insights on the need for cognition across these
segments. If the company finds that a particular segment is not interested in
certain product-related information, a different kind of appeal can be used in
advertisements. This can be backed up by customer-friendly information pro-
vided at retail outlets. Advertising campaigns in both television and automo-
bile categories have compared different brands. Santro and TCL (television)
brands launched comparative advertising. Such campaigns are effective
only if the target segments are interested in product-related information.
A brand may also propogate a major end-benefit (without much product-
related information) as it will attract prospective consumers who may not
have a high degree of cognition. Indica brand of car adopted this approach
highlighting the benefit of reduced fuel costs under certain conditions. When
a brand like Mercedes is positioned for a small niche, the research on the need
for cognition can be very useful in deciding promotional methods. If the target
segment is not interested in specific features, the company can provide a visual
demonstration of the brand and customize information through personal sell-
ing or the Internet instead of running a high-visibility advertising campaign
with information on several features. Dalda launched another related aspect
of cognitive research – that is, categorization among consumers as visualizers
who prefer visual information and verbalizers who prefer the written word.
It launched Dalda Light Vanaspathi detailing how the new brand has attri-
butes that do not raise cholesterol levels. After a few years, the sub-brand was
changed to Dalda Activ, with the advertisements built aroud visuals rather
than attributes. A new brand of electric scooter (Yo) launched a TV commercial
that deals with the basic benefits of the vehicle – fuel economy, safety features,
etc. Given the large number of prospective buyers in a market where petrol
prices are shooting up, the brand has taken a moderate approach towards the
“need for cognition”. Given the complexities of the new product category and
the diversity of target segment, the approach is an interesting example associ-
ated with the concept.
Personality and Need for Variety

With regard to optimum stimulation level, the need for variety may take dif-
ferent forms among consumers.
Exploratory variety-seeking involves switching brands to experience bet-
ter alternatives. FMCG product categories like soaps, shampoos and biscuits
have a number of variants, though there may be loyalists in some of these
categories.
Vicarious exploration is one in which consumers obtain information about
a new and different alternative and think about the option. Kinetic Honda,
the gearless scooter launched several years back,, came out with a “Himalaya
Rally” campaign, which emphasized the ruggedness of the product under
trying conditions. Use innovativeness is one in which consumers use the prod-
uct in a new way. Using washing machines for making lassi and paints/dyes
to paint cows during festivals are examples. Use innovativeness is not very
common in consumer products (but the Indian context is unique, as indicated
by the examples).
Interpersonal Influence
This deals with the responsiveness of consumers when they are subjected to
other interpersonal influences. There are three types of interpersonal influ-
ences used by marketers.
1. Information influence is the tendency of a consumer to accept informa-
tion from others about reality. This aspect may be useful to decide on
“word-of-mouth” strategies. In the category of durables, demonstration
at retail outlets may spread product benefits among the target segment
through consumers attending such demonstrations.
2. Value-expressive function is the tendency of consumers to enhance their
standing with others by attempting to be similar to those with whom
they compare themselves. Reference group appeals in several categories
are examples.
3. Utilitarian influence is the tendency of consumers to conform to the
wishes of others in order to obtain rewards (or avoid punishment). This
aspect may be indirectly reflected by the behaviour of some consumers.
The peer pressure to buy a brand of car within a price range is an exam-
ple of such behaviour.
Self-Image and Possessions

There is a strong link between the consumer and his/her possessions—the
product categories and brands he/she buys. It is a part of the consumer's “self-
defining” process and the consumer is likely to select a brand which is in con-
gruence with his/her personality. Consumers are likely to acquire products
which enhance their self-image. These possessions may be bought for func-
tional or symbolic purposes (status) or both. There are “self-altering” products,
which consumers seek whenever it is appropriate. A young executive about to
begin his career in the corporate world may choose Van Heusen if he believes
that the brand is likely to enhance his self-image. A middle-level manager pro-
moted to a senior position may acquire a specific brand of mobile phone if he
believes that it draws “respect” apart from serving functional purposes. Cos-
metics, apparel, watches, cars and jewellery are categories in which consumers
seek to modify or alter their self-image. Consumers may alter their self-image
out of physical vanity (inflated view of one's physical appearance) or achieve-
ment vanity (excessive concern about one's achievements). As materialism in-
creases, consumers get increasingly concerned with enhancing their self-image.
Fixated buying behaviour is concerned with the addiction of consumers to

buy products to display them, and they share the tendency with consumers
who have similar interests. Unlike shopaholics who are addicted to shopping
indiscriminately, fixated behaviour is normally associated with specific cat-
egories of products like watches, electronics, gramophone records, cigarette
lighters and automobiles. There are advertisements in several newspapers in-
viting sellers to sell old watches and this aspect is a reflection of the fixated be-
haviour of consumers who may be watch collectors. Fixated consumers have
a deep interest in particular product categories, and are willing to indulge in
extensive search (efforts and money) by “going after” the products.
Brand Personality—Lessons from Indian Brands of

the Yesteryear
In the category of soaps, Hamam, Cinthol and Liril have been in the mar-
ket for a number of years. Hamam has limited variants. Liril tried a few but
Cinthol has had the maximum number of variants. Liril has a very strong
brand personality developed over almost three decades. “Refreshing”, “en-
joyable”, “indulgent” and “fragrant” are the characteristics of Liril. Hamam
has been a family soap and in the recent times, it was positioned as an “hon-
est and clean” soap without harmful chemicals. Lux, for many decades has
been using celebrities and is associated with skin-friendliness and glamour.
Aramusk was a macho soap launched for men during the eighties. The brand
had immense potential to strengthen its personality, being the pioneer in cre-
ating a macho soap. Developing a personality in this category is extremely
important for a long-term association with the brand. Lifebuoy was able to
move from a mass-based soap to Double Action Plus, a brand variant for
urban teenagers; and Gold, for college-going girls. The personality of the
brand has been that of a “germ-killer” and this has been leveraged over a
period of time.
Lifebuoy may have changed and rationalized its portfolio of brands, but
the example illustrates how personality associations can be creatively handled.
Cinthol, Crowning Glory, Jai, Breeze and Mysore Sandal are soap brands that
may have a loyal consumer base, offering scope for strong personality associa-
tions. Such associations may help brands to develop an emotional relationship
with consumers.
In the category of scooters, LML Vespa created a personality around itself
when the scooters category was dominated by Bajaj. LML projected its person-
ality as “suave, sophisticated and standing apart from the crowd”. Yamaha was
strongly identified with “youthfulness and adventure” during the late eighties.
In the recent times, the brand attempted an association with a celebrity popu-
lar among youth. Hero Honda redefined the market with its path-breaking
100 cc economy bike and went on to create Hero Honda Splendor and Pas-
sion. The latter is advertised as a classy, lifestyle product. Rajdoot was another
bike brand with a very strong “personality orientation”. It was perceived as a
“rugged and tough” bike and was even endorsed by a film celebrity who had a
similar image. The brand was popular in the rural markets and even in toady's
context such a brand can be revived through creative use of imagery linking
contemporary aspects with the personality associations of the past.
Caliber, the four-stroke bike from Bajaj, developed its personality differ-
entiator from other “macho” associations that were popular with motorcycle
brands. The imagery and the storyline of the TV commercial reinforced the
idea of self-esteem through perseverance, fortitude and “spirited approach
under adverse circumstances”. While it is true that the functional aspects of a
durable brand in any category need to be competitive, the emotional associa-
tions through brand personality add to the appeal of the brand (as in the case
of LML Vespa or Caliber). Zodiac, the readymade brand of apparel, was prob-
ably the earliest of brands to create a personality in this segment with its iconic
model symbolizing formal, elegant and professional looks. Allen Solly, with its
semi-formal (or semi-casual) approach of Friday dressing may have appealed
to “non-conforming and casual” executives in software companies and adver-
tising agencies. Raymond, after hammering down its USP of being a “guide to
a well-dressed male” during the eighties, created “the complete man” during
the nineties. In the women's wear, there were two brands – Vimal and Garden –
which successfully attempted a different brand personality orientation during
the eighties. Vimal was portrayed as “lively, other-directed and full of verve”
and Garden was oriented towards “proud, aloof and distinctively classy” self-
image. Siyaram (suitings) attempted the ethnic route to create a personality
association – “young, modern and highly educated with a strong orientation
towards the country”. A certain degree of ethnocentrism was also involved in
the approach. Double Bull and Charagh Din, the readymade brands marketed
in Mumbai held significant appeal for a niche up-market segment. Consumers
may have perceived the brands to be “elegant and exclusive”. Though both the
brands advertised in a few up-market media vehicles, the limited availability
of the brands also added to the “exclusive” image. As a number of personality
dimensions have been explored and used in the fabric/readymade category, it
would be a challenge for new brands entering the category to cultivate a dis-
tinctive personality.
Brand Lifecycle and Brand Personality

The concept of brand lifecycle provides a framework for marketers to man-
age the meaning of the brand and hence, its personality. The framework also
provides scope for marketers to get into product categories that are within the
“image domain” of the brand's meaning and personality. The following are the
advantages of the brand lifecycle:
1. The firm can plan the brand's personality.
2. During the follow-up stage, the brand imagery and variants of the
brand can be managed in such a way that it is well within the image/
personality selected by the brand.
3. The meaning selected by the brand can be nurtured in a predictable and

enduring manner, enabling consumers to consistently identify them-
selves with the brand.
There are three stages in the brand life cycle—introduction, elaboration and
fortification. The brand selects either a functional need (consumption related)
which is external to the consumer or a symbolic one (internally-generated)
which is oriented towards self-concepts, group identification, status orienta-
tion or a hedonic (sensory) meaning (pleasure-oriented). These needs may be
reflected in the consumption or gratification involved in the variety experi-
enced by the consumer in the form of product variants.
Figure 6.2 outlines the three stages involved in the brand lifecycle. In
the introduction stage, the brand gets associated with a specific meaning.
For example, if Colgate has selected the functional benefit of decay preven-
tion in toothpastes, it should introduce variants that reinforce the functional
(problem-solving) orientation of the brand. In the Indian urban context, if it
is assumed that the category of toothpastes has entered the elaboration stage,
then Colgate is currently following the functional approach after establishing
itself on the functional platform for a number of years. It has Colgate Herbal,
Colgate Total, Colgate Gel and Colgate Sensitive Care. All the variants, includ-
ing the gel version (if associated with whitening action), reinforce Colgate as a
brand which is oriented towards solving dental problems and reinforcing the
benefits associated with oral care. Though the brand is built on a functional
platform, it is possible to develop a personality for the brand using appropri-
ate imagery. As per the brand lifecycle, Colgate may perhaps enter the mouth-
wash category in the fortification stage and use the personality cultivated over
a period of time.
Introduction
Functional or symbolic or sensory meaning
Elaboration
Strengthening the meaning
Fortification
Choosing a category that would have a
“fit” with the brand meaning developed
over a period of time
Figure 6.2  Brand Lifecycle

Among watches, Fastrack from Titan selected the symbolic meaning for its
brand. “Young”, “vibrant” and “casual” may be the characteristics that are as-
sociated with the brand. If it is assumed that the brand is in the introductory
stage of its lifecycle, the brand has the potential to intensify its personality
by offering upper-end “aspirational” watches to nurture the symbolic appeal
when it enters the elaboration stage of the cycle. At a later stage, the brand may
perhaps use its personality to get into categories that interest the target segment
of the brand. The category, for example, (given the personality of the brand)
may be readymade apparel. Fastrack is already into the category of goggles
(Refer Plate 9). If a brand of perfume has taken a hedonic or pleasure-seeking
meaning during the introductory phase of the brand lifecycle, it can offer a set
of variants (different fragrances) and emphasize its hedonism to strengthen
its original meaning. The brand can choose to make use of the hedonic mean-
ing and extend the brand name to the category of soap gels emphasizing the
“hedonic properties” of the brand.
Box 6.1
Research on the Impact of Personality
A researcher asked a set of consumers to watch the commercials of three
beer brands. One brand was targeted towards the drinker who perceived
himself as a failure; the second was targeted towards a social drinker; and
the third towards the reparative drinker—a middle-aged man who per-
ceived himself as someone who would have achieved more in life but for
his sacrifice. The 250 consumers chosen for the study watched and tasted
the beer brands. After being given sufficient time to see each commercial
and taste each brand, the respondents were asked to state their preferred
brand and complete a questionnaire which measured their “drinker
personality”. The result showed that for most consumers, the preferred
brand matched with their own “drinker personality”. In fact, the impact
of the brand personality was so much that many consumers thought that
at least one beer brand was not fit enough to drink. The fact was that the
kind of beer in all the “brands” was the same.
Self-expression and Emotion David Aaker makes an important con-

tribution to the development of brand personality by highlighting that self-
expression is to be emphasized more than emotion in the development of
brand personality. The following brand drawn from the Indian automobiles
sector explains the concept. There are five aspects to be covered with regard to
the differences between the usage of emotion and self-expression.
1. Maruti's “dream car” campaign emphasized the aspirational aspect of the

brand.
2. The characters in the TV commercial (consumers are likely to identify

with them) reflected the actual or others' actual self-concept—how they
see themselves as aspiring for the car or how they would like others to
perceive them.
3. The usage of the car was highlighted rather than the consequences of
using the car—the happiness involved in the usage of the brand adds to
the personality.
4. The product is associated with a conspicuous category—passenger car
and, hence, the brand's personality reflects the “other-directedness” in-
volved in the appeal.
5. The brand should ensure that the personality – aspirational, enjoyable
and status-oriented, is sustained over a period of time, especially when
the brand is identified at the “entry-level” and positioned towards a
segment that wants to move from a two-wheeler to a car. The brand
imagery associated with brands in various price ranges (in any cat-
egory) will vary though the degree of symbolism needs to be conveyed
creatively to highlight self-expression as applicable to the respective
segment.
Touch of Reality
Brand Personality and Self Concepts
There are several personality traits that can be measured. Achievement,
endurance, affiliation and aggression are some examples of personality
traits. According to Banwari Mittal, Moris, Sharon Priya and Arch, self-
concept is the “sum total of all the thoughts and ideas the person conjures
up when he/she thinks of himself/herself.” The linkages between self
concept and brand personality can be understood from the definition.
A brand of motorcycle like Rajdoot may position itself as “rugged, ex-
citing and aggressive” while a brand closer to the urban youth segment
may position itself as “youthful, romantic and contemporary.” Several
combinations of positioning statements are possible if primary research
investigation on the psychographics of the target segment is considered.
Psychographics are associated with activities, interests and opinions.
The target segment's psychographics may be reflected in a variety of
ways. They may also perceive the brands they buy in accordance with
the positioning of the respective brands. A buyer of Fastrack watch
may perceive the brand to reflect certain psychographic characteristics.
While exploring self concepts, marketers should use scales that indicate
bi-polar dimensions. Rugged to delicate, rational to emotional, conform-
ist to non-conformist and conservative to liberal are some examples.
7
Attitudes and Their Impact on

Branding Strategies
 Is there a concept that can be used to gauge and evaluate the overall re-
ceptivity of consumers towards a product category or a specific brand
(old or new)?
 How should a brand that wants to create a favorable impression on the
psyche of consumers approach its marketing mix elements? How can a
brand pioneering a product category ensure that consumers develop a
positive attitude towards the brand?
 Would the brands following a pioneering brand in a new category be in a
more advantageous position from the viewpoint of marketing?
 How is cultural value tied to the consumer mindset?
The concept of attitude will enable marketers to get several interesting and
useful insights about consumers because the concept deals with both the in-
ternal aspects of the consumer mindset and the intention to buy products and
brands.
Attitudes serve as quick “reference points” to consumer behaviour. In the
case of a new-concept product, consumers develop an attitude towards the
product category. When they accept the product category, they develop an atti-
tude towards specific brands, which can be measured by appropriate market-
ing research techniques. There is a strong link between beliefs, attitudes and
values of consumers.
Linkages in Attitude Formation

Attitude can be defined as a mental predisposition—favorable or unfavorable,
positive or negative—towards a person, concept, product, brand, service or
an idea. Beliefs are mental statements that may be concerned with any facet
Beliefs
Attitudes
Values
Figure 7.1  Linkages Between Values, Attitudes and Beliefs
of life—religion, nation, product or brand. Values are an individual's convic-

tions about his/her mode of living in a specific cultural setting. Values point
out to the individual on how he/she should set and accomplish his/her own
goals in life. Buying products and services is one of the major activities of an
individual's life and hence his/her beliefs, attitudes and values are important
from the marketer's viewpoint. Values shape attitudes and beliefs. Values dif-
fer from beliefs:
(a) they are few in number;
(b) they are enduring and difficult to influence;
(c) they orient the individual towards behaviour, which is acceptable in his/
her culture;
(d) they are not tied to specific situations;
(e) they are accepted by members of a society.
The linkages are shown in Figure 7.1.
Marketing Implications
A belief is what an individual thinks about the several aspects of his/her life.
In the marketing context, an individual may believe that Godrej is marketing
a number of product categories. An attitude has several components, which
are an outcome of interrelated beliefs. The attitude of the individual towards
Godrej will consist of (i) additional beliefs—attributes and positive aspects of
the company's products and its service, (ii) his/her behavioural response to-
wards Godrej, and (iii) specific feelings towards Godrej. (Feelings have an emo-
tional component and can get developed because of a variety of reasons.) In this
situation, a value that may influence the individual's attitude towards Godrej
may be a strong preference towards environment-friendly, “green” products.
7  Attitudes and Their Impact on Branding Strategies 181
If he/she believes the company is environment-friendly with regard to its prod-

ucts and has a strong preference for such products, it is likely to have a positive
impact on his/her attitude towards the brand. All beliefs need not necessarily
become attitudes. Interrelated beliefs build attitudes. An individual will have
a large number of beliefs, fewer attitudes and even fewer values.
Marketers normally attempt to reinforce existing favorable attitudes or cre-
ate some when a new product category is created. Changing an unfavorable
attitude is difficult task. Hence, marketers must be careful in the initial stages
of brand communication to ensure that unfavourable attitudes are not created.
They must also consider the “value” aspect in a specific environment – for
example, in certain product categories like cigarettes for women, pubs for the
youth and products not tested on animals. There are two aspects with regard
to the association of values in a marketing context:
1. Marketers may have to wait and offer their products in a way that they
don't have a negative impact on the values of consumers in a given
context.
2. Marketers can monitor the centrality of a specific value in brands among
the target segment. Centrality is the relationship between attitude and
a value. Stronger the relationship between attitude and value, the more
difficult it is for the marketer to break it. Consumers may differ in their
centrality and so it is important for marketers to probe these aspects. If an
apparel manufacturer is attempting to introduce a Western dress (which
needs to be considered in the backdrop of values in a specific marketing
context), there should be adequate consumers with low centrality. This
will ensure that consumers will, at least, make a trial purchase. If the
brand of apparel is launched for a segment with a high degree of central-
ity, the attitude towards the brand (even if it is new) will be unfavorable
because consumers associate their values strongly with their clothing
attitudes.
Even in a permissive/progressive city like Bangalore the number of

women smokers is insignificant, as compared to men smokers. Cultural fac-
tors, (specifically taboo associated with women smoking cigarettes) inhibit
women from smoking. Such categories that are culturally sensitive can be la-
beled as neo-mindset products. Marketers need to carefully research the val-
ues of consumers before launching such culturally sensitive products in the
marketplace.
Multi-components in attitudes
There are three components in attitudes, namely cognitive, affective and cona-
tive components. Cognitive aspects are linked to the beliefs and knowledge
about a brand's features/benefits. A consumer can have a number of beliefs
about a brand like Tropicana (the juice brand in the soft drink market). He/she
can think of it as a global brand: that the brand uses the best fruit ingredients
available in the market: that the fruit contents in the brand are healthy as com-
pared to aerated soft drinks. Parents may believe that the brand of juice is use-
ful to provide children, who otherwise are poor eaters. A marketer needs to
research the beliefs before planning a communication campaign. Affective as-
pects deal with how good or bad the consumer feels about a brand. This good
or bad feeling has an emotional part associated with the brand. This is one of
the reasons for brands using celebrities to endorse brands. Some brands prefer
to highlight the celebrity or the entertainment content rather than the features/
benefits of the brand. Such brands employ the peripheral route to create atti-
tudes (as against the central route that uses features/benefits of the brand).
The emotional aspect of the attitude (affective) is important as it projects the
“overall” attitude of the consumer towards it. A charismatic celebrity, espe-
cially in fast moving consumer product categories like soaps and chocolates
can have very strong effect on the affective component of the consumer's at-
titude. Such an inducement backed up by a good product creates brand loy-
alty. Conative aspect is the part of the attitude that motivates the buyer to
buy the brand (action phase of attitude). In durable categories, the retail store
ambience and attention provided to consumers play a vital role in transferring
the positive aspects of cognitive and affective components into final purchase
at the point of consumption. Brands that have already made a positive im-
pact through cognitive and affective components on consumers are generally
very successful when they run sales promotional campaigns. Several outlets in
modern retailing have offers from established brands. The brands need to be
careful about such promotions because constantly advertising brands as sales
promotion may have a negative impact on the psyche of consumers.
How are Attitudes Formed

Learning and associated theories contribute significantly to the formation of
attitudes. Positive reinforcement (satisfaction from a brand trial) and hence,
repetitive usage of the brand can lead to a favorable attitude formation. The
assumption underlying family branding (using the same brand for a host of
products) is that consumers generalize their learning with regard to a brand
and extend it favorably to its many other products – BPL, Videocon or Philips,
for example. The management of brand meaning over the brand life-cycle is of
major interest to marketers. Celebrity endorsements (Lux, Lenova, Titan and
Cadbury are some examples) are attempts to extend the positive attitude of
consumers towards the respective brand. Both classical and instrumental con-
ditioning contribute to attitude formation.
Cognitive learning that is oriented towards problem-solving can result in
positive attitudes. Marketers should find out the receptivity of the target seg-
ment before they position brands oriented towards problem-solving. Consum-
ers are likely to assess the information about a brand during the process of
forming an attitude towards it. They may not always process brand-related
information, except in the case of high involvement purchases. It is also
possible that consumers cannot take on too much information about a brand,
particularly when there is already a clutter of information. Research provides
useful information on how well consumers are prepared to receive informa-
tion. There is no point including a whole lot of features of a brand (especially
in technical jargon) in the advertisement of a brand, as they may not add to
consumer satisfaction. Marketers therefore have to carefully formulate their
communication even if benefits are strongly positioned.
Role of Beliefs in Attitude Formation

Beliefs play an important role in the formation of attitudes and marketers have
to be sensitive to the existing beliefs of consumers. This assumes significance,
especially when new-concept products are introduced.
When Zero B (water filter) was introduced, the initial communication at-
tacked the existing beliefs about boiling water for drinking purposes. The cam-
paign was later changed to “Safe, Safer, Safest” emphasizing the use of Zero B
as the safest of all other options. When Kellogg's came to India and launched
its cornflakes, consumers took it with hot milk (as drinking hot milk is a part
of the eating/drinking culture of consumers in India). A brand that launches
a new type of food needs to consider the beliefs of consumers towards their
(traditional) breakfast habits. The habit of eating is part of a given culture and
it is one of the most difficult habits to change. Given the cultural diversity of
India, consumers in different parts of the country would have different kinds
of beliefs towards breakfast. Tang orange juice was initially positioned as a
breakfast juice in India. Having juice as a part of breakfast is not a cultural
habit among Indians. Kellogg's, in recent times, has been positioning its offer-
ings for children (as seen from the imagery of advertisements). Chocos from
the same brand, too, is positioned as a nutritious food for children and one of
the advertisements highlighted the Rs 10 package (enhancing the “intention to
buy” aspect of the attitudinal component).
The promotional strategies currently followed by the brand (in terms of
sales promotion, packaging and product variants) are in tune with the pos-
itioning. Maggi is probably an unusual example in the food category that was
a success in the eighties. The brand used the convenience plank made famous
by the “two-minute noodle” advertising copy. Such a positioning would have
appealed to a number of urban, nuclear families. Such a brand also has the
possibility of developing a snack for teenagers with the distinctive possibility
of these consumers being familiar with the brand in their formative years.
Types of Influence on Attitude Formation

Marketers attempt trials for a brand with the idea of creating a favorable atti-
tude towards it. Braun, a brand of shaving systems for women, attempted this
approach in durables. Creams from the personal care category specify a time
period for the consumer to note observable results. This kind of direct experi-
ence would have a substantial impact on attitude formation among consumers.
The opinion of family and friends can have an influence, particularly on
the purchase of durables. Such opinions may lead to formation of attitudes
towards specific brands. A consumer who wants to buy a TV, car or wash-
ing machine is likely to seek such information before deciding on a particular
brand decision. The opinion he/she receives will have an impact on attitude
formation. The presence of Internet has added another dimension to the word
of mouth. There are several sites which badmouth brands and consumers vent
their frustration through these Web sites when the brand they buy does not
conform to their expectations. On the up side, a brand can have ardent follow-
ers who form communities, which forge and strengthen relationships among
its users.
The mass media can also shape the attitude of consumers towards product
categories and brands. Ideas, opinions and advertisements have an influence
on them.
Direct marketing, which is capable of customizing messages to niche con-
sumers, can create favorable attitudes among them as such an approach ad-
dresses their specific needs. Certain product categories may be more amenable
to direct marketing than others. Books, music and services (banking and travel)
are categories where the interactive nature of direct marketing can enhance
consumer attitudes. They can create a high degree of involvement towards the
offerings. These categories offer tremendous scope to satisfy consumers dur-
ing the presale phase of selling which in turn enhanced attitudes.
Research has established that individuals who have a high need for cogni-
tion (who enjoy information processing) are likely to form a positive attitude
towards advertisements full of product information. But marketers must use
this method with caution. Advertisements for televisions or cars are brimming
with product-related information. A brand following this approach should en-
sure that the copy of the advertisement conveys the information in such a way
that consumers are able to comprehend it.
New concept brands, for instance, the electric car like Reva would find
that this approach can be used effectively with direct marketing. The brand
can identify a small niche of consumers who are interested in trying out new-
concept products and apply the approach choosing appropriate channels of
communication.
Attitude towards Product Categories/Brands Though a number

of articles deal with attitudes towards brands, marketers are not interested
only in brands. They are also interested in product categories, especially when
new product categories come into a market. Brands can diffuse in a specific
market only when awareness about a new product category is created and a
favorable attitude is built up towards these categories. Figure 7.2 indicates the
manner in which attitudes develop towards brands or product categories.
When a new product category is introduced, the market does not usually
have too many brands. Washing machines, vacuum cleaners and water filters
New product Creation of a

Attitude categories category in
few brands the mindset
Usage
Time Consumer
familiarity
Brands Attitudinal Attitude

components towards brands
Figure 7.2  Attitude towards Brands/Product Categories
are a few examples in the Indian context. Consumers form an attitude towards
the category, as in Zero B discussed earlier. A small section may start trying
out the product. The new category gets diffused through word of mouth of the
users and also through communication strategies of the few brands in the mar-
ket. It takes some time for a category to be “created” in the minds of a larger
number of consumers. Once many consumers start using the product, con-
sumer familiarity with regard to the product category is established. Digital
watches, for instance, came in the late seventies when not many consumers
were familiar with automatic watches. But now digital watches have been well
accepted and consumers are familiar with the product category. A number of
brands enter a new category over a period of time. This results in a number of
positioning strategies and brand associations/images. There are several atti-
tudinal components that play a part in creating an attitude towards a brand.
Eventually, consumers develop attitudes towards various brands. This, in
turn, affects their decision making with regard to brand preferences. The mar-
keting implication is that the pioneer in a new product category should build
its brand effectively to ensure that consumers have a top-of-the-mind recall
with respect to the brand. Videocon in washing machines and Aquaguard in
water filters seem to have effectively adopted this approach when they en-
tered the market early.
Samsung and LG were late entrants in several categories of durable prod-
ucts. But these brands have been able to create a very positive attitude among
consumers with their product offerings and marketing communication. These
brands now have a substantial share of the market in a number of categories.
Changing the Basic Motivational Function There are four approach-

es to implement this strategy: changing the utilitarian function, ego-defensive
function, value-expressive function and knowledge function.
(a) Utilitarian function is a method that attempts to change the attitude to-
wards a brand, or bring in a new belief if it is a new one, by highlighting
the utility aspect for consumers. Apart from the conventional route of
using advertising to convey the relevant information, a few brands also
use the direct marketing approach to highlight their functional aspect.
When a brand attempts to bring in a new belief among consumers (in
this case, the utility aspect), it has to have an attribute or benefit, which
gives it a marketing edge over other brands. Nokia has models that have
several features and benefits in mobile phones. Dettol floor cleaner posi-
tioned itself as an offering for healthy homes, preventing illness. High-
priced brands need to make the consumers aware of the application of
the product, wherever applicable. For example, a brand of dishwasher
may have introduced the liquid variant and also have the proposition of
lower usage as compared to cheaper variants. This needs to be commu-
nicated to the consumer. As a category gets competitive, differentiation
is not achieved just by functional utility. It is achieved by the “value”
perception of consumers. Durables can also benefit from this approach
(refrigerators, washing machines and water-heaters, to name a few) if a
brand clearly demonstrates the effectiveness of not only the “primary”
benefit but also the secondary one. For example, all brands in washing
machines make tall claims of high technology and its impact on washing
fabrics. Utility, in the Indian context, is the saving of power and water
(secondary benefits) apart from the cleaning action, which is the primary
benefit. If a brand can demonstrate its effectiveness on the primary and
secondary benefits, it can create a new belief among consumers.
(b) Ego-defensive function is oriented towards protecting the self-image
of consumers. This approach is useful in personal and cosmetic prod-
ucts that guard consumers against embarrassment in a social situation.
It is important for a brand attempting this approach to use appropri-
ate imagery in the execution of an advertisement. During the eighties,
Colgate and Lifebuoy's variant used this approach. Clorets, in the
confectionery category, also positioned itself as a chewable gum “after
anything”.
(c) Value-expressive function is similar to the ego-oriented approach but
deals more with the values and attitudes of consumers (target segment)
rather than protecting their image. Imagery of an advertisement plays
an important role in reflecting lifestyle associations. Charms cigarettes,
launched during the early eighties, created an attitude based on “free-
dom and rebellion”. It was, perhaps, one of the earliest brands to create
an attitude among youth. The brand was offered in a pack with a denim
finish. This was when denim was becoming popular as a fabric symbol-
izing westernization, rebellion and freedom. The advertisement copy
said “Charms is the way you are” and was one of the most memorable
advertisements of that decade. Though the example may have been re-
peated elsewhere in the book, it enables the students to visualize the
application of the respective concept. Compaq, targeting the younger

generation, used a celebrity to indicate symbolic associations. The major
limitation of this approach is that there are several brands in a category
that use such celebrity appeals. This can fail to provide a differentiator
for a new brand because a pioneer in the category would have already
got associated with such appeals. An appropriate approach to overcome
this limitation, would be to follow the ego-defensive function (depend-
ing on the appropriateness of the situation) and follow it up with the
value-expressive approach. Raymond was always advertised as a “guide
to the well-dressed male” in the eighties. (This can also be classified
under the “fundamental values”. But clothing has a social appeal, and
so, the end benefit for the consumer may be “fabric confidence”. Hence,
the ego-defensive function may also be appropriate.) In the nineties,
it was positioned as a brand for the “complete man”, emphasizing his
several roles and experiences with his family. The limitations of this ap-
proach is that it reinforces the fact that a brand needs to update its core
offering associated with functional utility, and that no brand can eter-
nally bank on the symbolic appeals (a few categories like perfumes may
be able to use the symbolic appeal for a longer period of time).
(d) Knowledge function serves a cognitive need—the need to know.
Marketers can explain the advantages of certain brands to make these
brands competitive. In a competitive context, brands get associated with
several features and benefits. This approach of attitude creation is use-
ful in durable categories like TV, refrigerators and washing machines.
Communication should ensure that consumers are able to effectively
comprehend product-related information and benefits. The use of tech-
nical terms, even to convey the brand proposition, should be avoided
if consumers find it difficult to understand the information at the retail
outlets. Several TV brands advertise technical features. This requires the
personnel at retail outlets to have not only a sound knowledge of the
product but also the ability to match the needs of consumers with prod-
uct features. The knowledge function is very important for new-concept
durables. The vacumiser was a new-concept product, used to preserve
food. The difference between preserving food in the refrigerator and this
appliance was that the latter did not cause odour and prevented food
from going rancid. The product was launched with a basic pump and a
number of containers. Consumers could choose the number of contain-
ers they required. The knowledge function would have been very effect-
ive in such a case. Consumers needed to be educated on their needs and
how the containers would match their needs. Though awareness was
created about the product using direct marketing, the retail network that
marketed the product was oriented more towards selling the containers
than educating consumers. The knowledge function can also be useful
to position a brand in a multi-brand category like toothpastes. There is
a great deal of marketing communication and thus a strong need for a
new brand to develop a convincing differentiator to slip into the “con-

sideration set” of consumers. A strong emphasis on benefits may be
helpful in developing a favorable attitude towards a brand. Colgate
Total was positioned on several benefits based on specific ingredients, as
a toothpaste that gives “prolonged freshness”.
Association with Events: Attitudes can be created by relating a brand

with certain events or social groups. Fosters, the well-known Australian
brand, sponsors the Grand Prix with the idea of associating itself with sports
enthusiasts. Millions of viewers watch this event and reaching even a section
of the audience interested in the brand will create a positive attitude towards
it. Coke and Pepsi are other brands that sponsor events in which the brand
connects with the target segment. This approach pays if sponsoring is even a
part of the overall brand-building strategy. Of course, the event itself should
be of interest to at least a section of the people. It is imperative that the brand
association, along with the event, should strengthen the personality of the
respective brand. Sponsoring a beauty contest or a sports event without con-
sidering the overall brand associations may have a negative impact on the
brand.
Dealing with Conflicting Attitudes: Certain product categories may

have given rise to conflicting attitudes over a period of time in the minds of
consumers and these must be addressed to change attitudes.
Microwave cooking is convenient but consumers may think that the food
made in the appliance is not tasty. Marketers should probe and identify such
conflicting attitudes that cause the effect of a favorable belief to be nullified by
another unfavorable belief. As long as conflicting attitudes are not addressed
in marketing communication, brand-building efforts may not yield results.
There have been beverages and fast foods with soya-based offerings that were
not significantly successful in India. Though consumers may be convinced
about the health aspect of soya, they may simply not like its taste. The affected
component can be addressed using a celebrity who appeals to the target seg-
ment. This may have an impact on the die-hard fans of the celebrity. Marketers
should also attempt to enhance the word of mouth to remove these conflicting
attitudes. A major share of the plastic containers market is in the un-organized
sector. Tupperware, a brand of plastic containers, has a premium pricing and it
positioned on lasting durability. Consumers may be convinced that the brand
is durable but also expensive. Word of mouth on the value offered by the brand
in terms of the durability associated with it versus the “not-so-durable” offer-
ings from the un-organized sector may convince the consumers of the “value”
of Tupperware.
Changing the Relative Evaluation of Attributes: As a product

category develops over a period of time (from ice-creams to up-market cars),
more and more brands come up, with each of them offering a set of features/
attributes and benefits. Consequently, there are several segments based on

product features and benefits. In the refrigerator market there are consumers
who prefer the “no-frill” 165 litres model. There is a cross section of consumers
that prefers the frost-free model. There are consumers who want a brand that
offers them flexibility with regard to storage space and there are others who
want quick-chilling features. LG, the brand that has made its mark in some
durable product categories, positioned itself on the plank of preservation of nu-
trition. This positioning is in tune with the basic benefit that consumers expect
from a refrigerator—preservation of food and beverages. In the present-day
context, consumers are familiar with refrigerators as a category and also aware
that all brands offer cold storage. The core proposition of “cold storage” is no
longer a differentiating factor among refrigerator brands. If the consumer's
evaluation of a brand can be upgraded with a useful feature/benefit, there is
likely to be a shift in his/her intention to buy the brand. This approach also
repositions what the consumer looks for in the respective product category.
It is implied that there is a target segment which may be interested in such
updated and relevant features, and hence, the approach need not necessarily
cover the entire market during the same time period. The objective of a pre-
mium brand will generally be to capture a niche in the market. Hero Honda
(motorcycles) changed the evaluation of consumers on product attributes
(looks, riding comfort, maintenance, etc.) with an overwhelming claim on just
one attribute—economy, (even though it could have presented other benefits.)
The positioning, when it was launched, was “Fill it. Shut it. Forget it”.
Changing Brand Beliefs: A brand has to reinvent itself when competi-

tion sets in. There may be a need to change the beliefs of consumers towards the
brand by using new attributes/benefits. Introduction of “new” and “improved”
versions or re-launches are some types of situations where this approach is ap-
plicable. It is important for consumers to perceive the “newness” of the brand
and, as far as possible, the benefit needs to be tangible if the brand is promis-
ing enhanced functionality/benefits. In the category of malted/milk additive
drinks, a number of brands have made such claims and it will be worthwhile to
find out how these claims are perceived by consumers. A belief towards a brand
can change only when consumers perceive the benefit. In the recent times, Bri-
tannia has been able to change the belief towards the brand by using a number
of variants and sub-brands in this category and consumers can perceive the
changes through taste. Kellogg's, by introducing its biscuits, Chocos, at lower
level price points, has attempted to change the belief that the brand is expen-
sive. While attempting to change brand beliefs, a brand should take into ac-
count certain beliefs and habits of the people in the environment. Culture is a
part of the environment and eating and drinking is a part of any culture. Great
Shake was a tetra-packed soya drink from Godrej. While the initial campaign
during the eighties positioned the brand as a quick, “filling” drink, the later
campaigns emphasized the goodness and nutritional aspects of soya and how
the drink was popular in a few Asian countries. There are two aspects a brand
may want to consider in this situation: a) what is the established culture with
regard to eating in a given market? b) would a new offering of food appeal to

the consumers in a specific cultural setting?
Another aspect that is important in changing beliefs about an existing
brand is the importance given by the consumer to a specific attribute or bene-
fit in the evaluation of a brand. During the early nineties, Ambassador (the
dominant brand in the category of cars for several decades) came out with a
campaign in an attempt to reposition itself. The campaign repositioned the
brand as one that is most suitable for the rugged and crowded Indian road.
While any consumer will certainly agree with the factoid on Indian roads, the
question was whether this benefit will be an important factor in the decision
making cycle of consumers, particularly when all brands are perceived to be
adequately suited for Indian roads. When changing brand beliefs, it must be
ensured that the attribute/benefit chosen for the new belief must be relevant
to the consumer.
Adequate research needs to be carried out to find out if consumers per-
ceive the change in the “position” of the brand to be too radical. An extreme
change advocated by a brand (compared to the past positioning strategy) is
likely to be rejected and such a perception from the consumer's viewpoint
is based on the assimilation-contrast theory. Marketers should be “moder-
ate” in their attempts to change brand beliefs. A brand of hair-cream like
Brylcream (a brand that has been already in the market for years) may not
want to suggest that the brand is totally non-sticky because consumers ex-
pect a certain level of greasiness/stickiness in a hair-cream. This is true
particularly of this category that has not grown much or been attempted
with too many positioning strategies. Parachute, the brand of coconut oil,
avoided assimilation-contrast by bringing in a sub-brand, parachute light,
in the coconut oil category. Parachute Light suggested that the offering is
lighter in terms of greasiness and easier to use when compared to the con-
ventional coconut oil. Another way to avoid a negative effect in a situation
of this kind is to visibly demonstrate the feature or benefit underlying the
change. When Kinetic Honda (the gearless scooter) was introduced in the
eighties, it was competing against well-known brands that were rugged
and oriented towards Indian-road conditions. The sleek look of the brand
may have created a doubt in the minds of the consumers (who had all along
been using conventional scooters) about the ruggedness and durability of
the new offering. The band sponsored a “Himalayan Rally” in which riders
of the brand participated. The event was effectively captured in a TV com-
mercial. Parachute brand introduced “After Shower” sub-brand in the hair
cream category rather than attack the strongly entrenched belief about the
greasiness associated with the hair cream category. Smartness, style and
dressing for the occasion are certainly in tune with the “grooming ritual”
of youth in the present day context.
Using a New Attribute Brand: Brand beliefs can also be changed by

bringing in a new attribute that is ignored by competition, or by adding an
attribute based on the technical aspect. Godrej (refrigerators) emphasized
the “puf” usage during the eighties and highlighted this as its positioning
plank. Though a number of refrigerator brands used “puf”, these brands
had ignored this aspect in their positioning strategies. Oral B tooth brushes
introduced the brand with a mechanism that enables a consumer to know
when he/she should change the toothbrush. This attribute is a result of
technological innovation. Research on choosing attributes ignored by com-
petitive brands can provide important insights. There is a need to consider
the perception of consumers on what they consider as a favorable attri-
bute/benefit. Bisleri, in the soda category during the eighties, positioned
itself as the “Quiet soda” (with less of carbonation). It was a new offering
that could be categorized under changing the importance associated with
the attribute (the positioning that carbonation is not an important attribute
in this case). Red Label added vitamins and anti-oxidants as an extra attri-
bute. While adding an attribute, it may be worthwhile to find out if con-
sumers are interested in that attribute. A few years ago, refrigerators were
launched with multiple doors. Research by a manufacturer showed that
consumers did not perceive this as an additional attribute. Technology can
redefine the market and the concerned brand can get a high-visibility when
an attribute conveys a strong benefit. Hero Honda, with its four stroke en-
gine (and hence, better mileage), redefined the category of motorcycles.
Ever since, every manufacturer has introduced the four-stroke version.
A brand should pre-empt competition while adding attributes because a
number of brands are likely to follow the pioneering brand over a period
of time. A few brands had remote-control when color televisions were in-
troduced but today, it is virtually impossible to find a CTV without one.
This holds good for a number of categories like cars, watches, washing
machines and two-wheelers. Another aspect of adding a new attribute is
the cost involved in introducing the attribute. Even in FMCG categories,
adding a new attribute may involve cost.
Overall Attitude towards the Brand: Another approach towards

changing the attitude with regard to a brand is to have a global statement
in the copy of the advertisement. “Your guarantee of good impression” from
Kores; “If it is Philips, you are sure” from Philips; and “The Ultimate Lux-
ury” from Esteem are some examples of this approach. Generally, such global
statements are associated only with brands that have made an impact on the
psyche of consumers (the discussion in this context is not about a brand's suc-
cess). In these examples, the brands were well known and had made an im-
pact on their target segment at some point of time. Consumers should feel
that the global statements carry adequate authenticity and credibility, for this
approach to be effective.
Focusing on Competitive Brands: Repositioning competition is an-

other way to change the attitude of consumers towards a brand. One of the
earliest brands to attempt this was Tylenol. It was introduced at a time when
Aspro was the largest selling brand in the US. Tylenol, in its advertisement
copy highlighted the negative aspects of consuming Aspro and said it

(Tylenol) did not have features that caused the negative effect. The campaign
is supposed to have had a phenomenal impact on consumers. In the Indian
context, Kinetic Honda repositioned scooters (as a category) as staid vehicles.
The market for gearless scooters (like Kinetic Honda) is growing and the mar-
ket for traditional scooters is on the decline. There are two prerequisites to be
followed before a brand attempts this approach:
1. If claims of product superiority are made, the brand should be perceived
as having a strong edge over the competitive brand on the claims made.
Ind Suzuki, in the eighties, came out with an advertisement comparing
the brand with Hero Honda on a variety of features. HCL did compara-
tive advertising with Modi Xerox in the category of photocopiers. Con-
sumers should perceive a brand to be superior and that is likely to hap-
pen only when the brand attempting the comparison has good attributes.
2. When consumers have a strong belief structure in certain product cat-
egories, brands will have to be careful about repositioning competition.
Savlon repositioned Dettol using the Tylenol route and highlighted the
burning and stinging sensation caused by Dettol. If many consumers had
believed that the burning sensation triggered off the positive action asso-
ciated with antiseptic lotion, the approach would not have been effective.
Moov, a brand of pain balms associated with sprains and aches, reposi-
tioned its competitor Iodex saying that it (Moov) did not leave stains on
the user's clothes. In this context, the consumers may have perceived the
benefit to be very tangible.
The Elaboration Likelihood Model (ELM)

This model suggests that there can be two routes to persuade consumers. One
is the central route or the “product relevant” route and the other is the per-
ipheral or the “non-product” route. The central route has a focus on product
attributes or core functional benefits and the peripheral route is oriented to-
wards “non-product” aspects like the celebrity and/or background used in the
advertisement, excellent packaging or free samples. The central route, primar-
ily seems readily applicable to consumer durables as they are likely to com-
mit the cognitive resources of consumers (generally being high-involvement
products). But even in certain product categories of consumables, there is scope
for the application of the Elaboration Likelihood Model (ELM). For example,
a brand like Colgate Total (which promises a number of benefits) may appeal
to consumers who may like information on the chemicals used and their ben-
efits. Mouthwash brands like Listerine can explain the rationale of the ben-
efits they provide. The prerequisite of this approach is that the target segment,
apart from being interested in the product benefits, should also be information-
oriented. There may also be a few instances when a brand has used both central
and peripheral cues to make an impression on the target segment. Samsung
Consumers and
Durables
MAO
High Low
Central Peripheral
route route
“Attribute/Benefit”- Focus on celebrity

Based or background in
Communication the advertisement
Figure 7.3  The ELM Model
(TV category) came out with a model that had extra viewing space and the ad-
vertisement used humor, apart from highlighting the brand benefit. Whirlpool
effectively used the “ice, ice baby” campaign, which had certain peripheral
cues like a catchy jingle and background setting. Whirlpool used this approach
when it had created adequate brand awareness in India and took care that the
peripheral cues did not overshadow the brand's benefit—of making ice in a
short time. If a brand chooses to use both types of cues, it has to ensure that
the peripheral cues do not overshadow the central cues, especially for durable
products. Santro effectively combined the two in a series of advertisements—
the initial one featuring a celebrity to capture the attention of consumers. This
created brand awareness among the target segment. The campaign was fol-
lowed by competitive advertising where Santro was compared with a number
of brands on several features (central cue). Fanta (soft drink is an impulsive
buy) has been using humour (peripheral cue) in the recent times.
Figure 7.3 shows the application of the ELM model with regard to attitude
creation/change. MAO represents motivation, ability (to comprehend several
aspects of the given information) and opportunity (time pressure or a wrong
media selection strategy).
Ideal Point Model

Practising marketing managers will find the Ideal Point Model effective in
measuring attitudes. This model captures consumers perception on the “ideal”
brand (with ideal features) and compares their perception on existing brands.
The following are the components of the Ideal Point Model:
Ab —attitude toward the brand

Wi —importance of attribute i
Li —the “ideal” performance on attribute i
Xi —beliefs about a brand’s actual performance on attribute “i ”
n —the number of salient features.
If the model is applied to a brand of TV, say A, the following attributes can
be identified.
1. Picture quality
2. Audio quality
3. Usefulness of special features
4. Handling ease
5. Aesthetic appeal
6. Compactness
Consumers can mark the ideal brand and rate A on the attributes on a scale
of 7 ((1) given to reflect the low perception and (7) to reflect the high percep-
tion on the respective attribute). The application can, for example, result in the
following analysis.
Attribute Importance Ideal Brand A

(Wi) (Li) (Xi)
Picture quality 7 4 3
Audio quality 4 3 2
Special features 3 2 2(usefulness)
Handling ease 3 1 4
Aesthetic appeal 2 4 1
Compactness 1 3 1
The formula for attribute Ab towards the brand can be applied as
n
Ab=
Σ Wi (Li−Xi)
i=1
For Brand A, the resulting value is 28.

Implications of the Model:

1. A brand can find out how close it is to the “ideal” brand. A value of “0” is
ideal because at this point the brand is the “ideal” brand.
2. Higher the value of a brand, farther away it is from the “ideal” percep-
tion of the brand. (Minus sign does not alter the value as the objective of
the model is to measure the distance of a brand from the “ideal” brand—
Wi (Li – Xi) is to be considered.
3. A brand can improve its attributes and move closer to the “ideal” brand.
In the example, except for the usefulness of special features, Brand A is
farther away from the ideal brand on all aspects and requires improve-
ment on these aspects.
4. A brand can shift the importance associated with an attribute. Brand A,
for example, can alter the importance on aesthetic appeal (on which it is
below the ideal brand) by an advertising campaign that stresses the attri-
butes on which it is ranked high.
The approach needs to be preceded by research on the perception
of consumers on this new attribute/benefit. For example, if a sham-
poo brand wants to shift the importance of attributes by introducing a
new benefit “spreading action to make the roots stronger”, the percep-
tion of the consumer needs to be captured before the brand uses the
attribute.
Touch of Reality
Attitudes Matter in an Emerging Market
There are strong Indian brands (from the viewpoint of market shares)
like Amul (butter), Eureka Forbes (water purifiers), Nokia (mobiles),
Maggi (noodles), Fair & Lovely (fairness creams), Cadbury (choco-
lates), Johnson & Johnson (baby-care products), Titan (watches), Dettol
(antiseptic solution) and Maruti (cars).
While some of the brands may have faced competitive pressures
from other brands in the category, some of the brands may have a large
share in a thinly penetrated market. Attitudes are important, both from
the viewpoint of category development and brand associations/beliefs.
For example, in the categories of water purifiers or antiseptic lotion,
brands may have to create appropriate beliefs to expand the market. In
the case of a brand like Nokia, distribution channels have played a major
role in shaping the beliefs of consumers towards the brand (display

of the brand's range, price points being explained at the point of pur-
chase and customized selling at the point of purchase). Mobiles phones
are available at about one lakh outlets and Nokia is prominently dis-
played at most outlets. All these aspects get translated into a liking for
the brand and this aspect is the “affective component”, or the overall
evaluation of the brand. In another category like soaps, the Rs 5 price
point accounts for 12.8% in value terms in the category. There may be
a cross section of consumers that buys the SKU due to the influence of
conative component (intention to buy) because of the price level afford-
ability. 50% of Fair & Lovely brand's sale comes from sachets (another
category where aspirational levels are high and sachets have created the
affordability appeal). Fair & Lovely's ayurveda (herbal) variant contrib-
utes to 10% of the brand's sale. Beliefs about facial creams that have a
herbal touch, plus beliefs about the brand's effectiveness can be asso-
ciated with the cognitive part of attitude, which in turn influences the
affective part positively.
Caselet
Attitudinal Linkages to
New Product Category Creation:
Attitudes and “Aftershower”*
Male Grooming – The Aftershower Journey

Background
The turn of the millennium was a harbinger of hope for a generation awaken-
ing. The Internet revolution had sparked a movement that had completely
redefined the way people saw life and its tenets. It tore down barriers, both
social and geographical, and ushered in the era of globalization – an era where
people, both young and old, started getting exposed to happenings in “their”
world and started to make “choices”. Their lifestyle was no more a set of mores
laid down by society – but a reflection of choice; a choice driven by individual-
ity, of personal attitudes and a reflection of changing world view.
India, as a country, was uniquely placed in this era of change. Post liberal-
ization, the country had for the first time shaken off its legacy of mediocrity
and was looking to compete in the world market. It had emerged as an IT
powerhouse – Infosys, Wipro and a host of other firms had turned the spot-
light on the nation; suddenly “Made in India” was a good tag to have.
There was an enormous amount of positivism in the country – starting
from the political parties to the media, everyone was talking about the future
in a positive frame. Indian youth were making news all over the world, be it
in IT or space or business.
What this did for the country – was that it brought about a change in mind-
set. Suddenly the masses were not content with what they had, but were ac-
tively seeking resources that were driven by individual choice.
Male Grooming – Category Overview

The male grooming category in India, at that point in time, was dominated
by shaving products – blades, shaving creams, and deodorants were the key
* The caselet was written by Mr Arnab Das, Brand Manager, Marico Ltd. in the conceptual
format provided by S. Ramesh Kumar, Professor of Marketing, IIM Bangalore, who also
prepared the solution note.
The author would like to thank Mr Sameer Satpathy, Head Marketing, Mr Arnab Das,
Brand Manager and Ms Deepa Rajaram, Human Relations Manager, Marico Limited for
their time, effort and support in preparing the caselet and advertisements featured in this
book
segments that constituted male grooming. Vanity, for men, revolved around
shaving.
The male grooming category was small and valued around 200 cr—the
major players being Col-Pal, Gillette, Godrej, Old-spice and Park-Avenue. The
category had started registering growth with the entry of Gillette and Park-
Avenue in the market, and because of category building communication by
the two large players. It was a low investment, low interest category in which
the key players were starting to create excitement through the launch of new
products.
The hair creams segment was estimated to be around Rs 22 crore (Nielsen
offtakes valued the category to be even lower at around Rs 11 cr) the key
players being Sara Lee India (Brylcream) and Hindustan Lever (Clinic
Active).
The category was on a hopeless decline. From a 400+ tons per annum
(TPA) market in 2000 it had dropped to 200 TPA, and slowly it had become
unattractive. But numbers actually had a deeper story to tell. The decline was
driven by the absence of competition. HLL had withdrawn Clinic Active from
the market leading to a category decline. To compound matters further, the
only player left in the category – an MNC brand, was not investing in mar-
keting.
And all this was happening when the household penetration of the category
was going up. Somewhere, there was a crying need being expressed by the
consumers for an oil substitute for daily grooming – a product in a format that
provided the benefits of oil but helped them stay away from the messiness.
Target Segment (TG) Profile – Cream Users

Cream users
 Demographics
  Male; Socio-economic classification (SEC) A [upper and upper middle
class]
  Age band 25–34
 Psychographics
  Successful in career, working for a good organization
  Image conscious
 
Confident
  Fashionable
  Self-driven in making choices
The consumer's basic need was to have a product that kept hair in place
and made him look good.
Needs from Male Grooming

The Indian populace, by the turn of the century, had undergone a complete
change in demographics. 54% of the population was below 25 years of age.
The arrival on the scene of a completely young consuming class had a telling
impact on the marketing of everyday products – new trends had started to
emerge.
The consumers had suddenly become young. The future was bright and
there was a marked change in attitude. Gone were the days when the youth
found conformance to be a virtue – conformance to rules laid down by an
older generation with values based on machismo; today, it was all about “it's
my life” – it was ok to indulge.
 There was a growing obsession amongst the consumers with enhance-
ment of hair. Hair was no longer an accessory that needed to be in place,
but had become a conduit to look good, to look modern and to com-
pletely transform one's appearance.
 Hair care had suddenly become relevant to all sections of consumers.
 Hair had to look good for the “package” to be valued as worthy.
Yet, the needs from hair care were limited. The key desires are listed below:
 Basic styling—epitomized by the monthly hair cut, was monthly. Hair
styling, as a concept, had not evolved till then.
 Daily grooming needs—encompassed the following features
  Basic setting of hair
  Non-sticky/pleasant smelling product
  Product not harmful to hair
  Oil and water dominated, as a universal post-bath habit.
 Occasional fashion
  Gelled hair
  Very small number of people used hair colour.
Aftershower
Opportunities
In creating a new space
All the current players were playing in the style – cosmetic segment. The entire
platform of natural style provided with an enormous opportunity to tap into.
See Figure 7.4
SETWET Style
Gel
MNC brand
Gel
MNC Brand
Opportunity
Cream
Cosmetic Natural
Health
Figure 7.4  The oppurtunity for a new offering.
Weak competition
An MNC brand had been around for a long time. It was the first and the old-
est brand in the category and had a large range, but it was perceived to be
old fashioned – “dad's brand”, “fuddy duddy” etc. The brand had been seen
around for too long and the consumers did not perceive any change to have
happened. The core of the brand was built around “experienced hair style” ra-
ther than being aspirational and hence, it was being lapsed out by consumers.
Figure 7.5 presents a SWOT analysis of the MNC brand.
The consumers had become indifferent to the brand and the category at
large, as relevance for the product in the changing scenario was not being
built up.
Challenges
To get the marketing mix right.
 The new product had to be better than the dominant MNC brand
  The MNC brand was the global leader in male grooming
 
A well-known Indian brand did not sustain itself in the market
 It had to be distinctive
  Success would be impossible without a USP.
Strengths Weaknesses Opportunities Threats
- Category pioneer - Product performance * - Allied categories ie. gels - New entrants
- Heritage - No do good properties - Infrequent usage /
Declining consumption
- Market Leader - Strong chemical perception
- Degrowing category
- No market / consumer
development
Opportunity for Aftershower Hair Cream
*Quantitative study in Mumbai done in May 2005

Figure 7.5  SWOT of an MNC brand that was in the market for a
long time
Product
The following were the differentiators in the product:
 Natural – it contained coconut milk proteins
 With aqua moisturizers – helped aid the fresh feeling throughout the day
 With refreshing zingy fragrance
 Completely non-sticky
The formulation was clearly superior to the MNC brand.
Packaging
The packaging was clearly superior to the MNC brand (Refer Figure 7.6)
Proposition
The proposition was based on the following elements
 Natural daily grooming
 Style and substance
 From Parachute Advanced
This led to the communication tagline “Style on . . . everyday”.
Figure 7.6  The appeal of packaging
The proposition was clearly as an everyday-use product that was not only
non-sticky and helpful in styling hair, but also helpful in nourishing it.
The proposition scored highly with the consumers as they liked the ele-
ment of style + nourishment.
The proposition was very clearly distinct.
Physical distribution
Distribution also emerged as a very clear differentiator
 Marico distribution clout was leveraged

 The MNC brand, which had a distribution model that banked heavily on
wholesale reach, was outplaced.
Clearly, the retail muscle provided the ability for Parachute to out-perform
the MNC brand.
Targeting
Demographically the target group was defined as
 Male; Socio-economic classification (SEC) AB;

 Age 15–34
What this definition of TG did not define was
a) Who would the cream user be?

b) Who would not be the cream user?
c) Amongst the cream users, who would still continue to use hair oils?
Extensive research has led to an understanding of the male consumer

and his product preference basis—his position in the do good – look good
continuum (Refer Figure 7.7).
Consumers who had very strong health/nourishment needs would prefer
to use oils as a preferred product, whereas those with only styling needs would
use a gel. That left a substantial overlap of nourishment and style needs: the
Core TG for creams.
The broad-based demographic group was further sharpened using
psychographics.
Male consumers in the age band 15–34, SEC ABC, who may be just out of
college in their first job, and with an internal (driven by need for hair health
benefit) orientation, who are users of hair oil, would be the ideal convert into
creams. The consumer would be residing in town classes with a population of
10+ lakhs, he would be ready to groom – may be not ready to show. The Gel
user would have a strong external (hair appearance and sensorials) orienta-
tion—he would showcase his sense of style to the world and celebrate his in-
dividuality. There were certain other lifestyle traits that went into identifying
the Aftershower user:
 He would either be in his first job, or would be at the crossroads—out of

college – into first job.
 He would be ambitious; he would aspire for success in his career
Nourishment Style
Figure 7.7  The do good – look good continuum

 He would have an active out-of-home lifestyle

 He would love gizmos and girls
 He loves to watch TV, movies
 He loves sport – especially cricket
 He is confident but is unsure of how well he is matched with his peer
group
 He wants to look clean and presentable.
The consumer who had his grooming needs satiated by hair oils would not
venture into the creams space. But consumers who were not comfortable with
the sensorials for oil would definitely be trying the offering.
Strategy
The tasks were simple:
 Category creation
 Share gain from competition
The strategic pivots for building the brand were as given in Figure 7.8:
Celebrity
Communicating the proposition to the audience was the next challenge. There
were barriers that needed to be overcome to make the proposition salient:
 The category, to the youth, was being equated as unexciting.
 Style had to be made exciting so that people connected to it.
Build Drive
Awareness Penetration
Retail visibility Celebrity
Figure 7.8  Creating a favourable attitude.

 The communication had to cut through across India.

 Break media clutter
Clearly, the brand needed an ambassador who could
 give a different dimension to styling
 appeal to youth all across the country
 lend the brand a youthful and sporty image
Based on the above factors, Yuvraj Singh was chosen as the brand ambas-
sador. He was a rising star and was performing well in the international arena
(captured success), he was perceived to be stylish and played cricket – a reli-
gion across the country.
The TV commercial established the key proposition of non-stickiness, style
and everyday usage.
Build Awareness
The TV was to be the main medium to be used to build awareness of the brand.
The focus was to be on south India because
 It accounted for more than 38% of category volumes
 It accounted for 23% of TG; and hence it was the only way to reach the TG
in a cost effective manner
 It had media isolatable states; with higher return on investment (ROI) for
spent revenue
Two bursts of approximately 750 gross rating points (GRPs) with a reach of
45% TG at five times exposure was planned and executed.
Drive Trials and Penetration

A new 14gm Rs 10/- pack was used during the national launch to drive trials
and also penetration. A Rs 10 pack had been launched by the MNC brand in
the gels segment and it contributed 22% to the gel volumes.
The Rs 10 pack propelled growth in the creams category and increased pene-
tration. This was one of the key reasons for a very fast market share (MS) gain.
Retail Visibility and distribution

Retail visibility/Brand Identity Windows [BIWs] was one of the key factors that
drove awareness and this was substantiated by the results during the prototype.
It was also an optimal way of creating awareness in non-media covered metros.
Results
Post launch, Aftershower had become a benchmark for success in Marico.
By December'05, Aftershower had achieved a volume of 22 tons and a share
of 33.3% in the cream segment
Sec & Offtake Trend

25.0 0.4
21.6
0.35
Volume - Tons
20.0 18.6 33.6%

28.7% 29.0% 0.3
28.5%
25.3% 0.25
15.0
21.9% 13.1
19.2% 0.2
10.0 9.9 9.8 0.15
0.1
5.0
5.5% 0.05
2.1
0.8 0.5 0.4
0.0 0
Mar-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05
Secondary - Vol % MS
Pivots that Worked

The key pivots that have worked on the brand are
 A winning proposition addressing the consumer's need gaps
 Rs 10 pack – driving trials into the category and also ensuring penetration
This created good visibility for the brand in retail and helped create aware-
ness of the brand. Good visibility enabled Marico to launch a new brand in a
category that was dominated by the MNC brand.
Post Evaluations of advertisement

 Awareness – 77% of TG
  Source of awareness – TV; also a lot of word of mouth was working on
the brand
  Overall success in creating curiosity about the brand
 Consumers found it to be a new category product – unique
 Expectation from the product were also set high
  Providing shine and health were the key expectations
 The likeability of the advertisement was very positive
 The advertisement established credibility of the claims
 Established relevance for the product
 Yuvraj was a key element recalled and all the situations registered
with the consumers; he was a strong hook but did not hamper brand
communication. The situations registered were:
  Yuvraj applying cream
  Yuvraj and the girl
  General functional elements
Parachute Aftershower cream – in a short while it had been able to create
an image around Style: for style-conscious people. (See Figure 7.9)
Figure 7.9  Image versus Performance.

Annexures
Product definitions
Hair Cream Hair Gel
Form Opaque Transparent
Product Hair cream is oil and water based. Hair gel has no oil
Hair cream gives nourishment – It does not give any
because it contains oil nourishment
Stickiness There are less polymers; There are a lot of polymers;
hence, cream is non sticky hence, gel is relatively stickier.
Retail POPs
Retail POPs were used extensively to create visibility for the brands. The dif-
ferent elements were
 Posters
 Banners
 Danglers
 Retailer detailers – were used to differentiate the brand offering vis-à-vis
the competition
 Product detailers – detailed product attributes and were a handy aid to
frontline sales force.
 BIW – Brand identity windows. They created a separate zone for After-
shower in the outlet
 Floor dispensers – used for product displays in modern trade.
Question*
How would you apply an appropriate theory of attitudes to analyze the
conceptual learning from the case?
Suggested reading
 Leon G. Schiffman and Leslie Lazar Kanuk, Consumer behavior, 9th edition,
Pearson education, 2007.
* Instructors discussing this caselet can obtain the solution note from the author by
contacting him at rkumar@iimb.ernet.in and sending their affiliation.
8
Diffusion of Innovation:
The Acceptance of New Products
and Brands
In today's competitive context, marketers are not only concerned with launch-
ing brands but also with how consumers accept them in the market place. Dif-
fusion of innovation is associated with:
1. how consumers accept new products and brands (specifically the target
segment of consumers in a given social context), and
2. how they accept a set of marketing mix elements formulated for a brand
over a period of time. Though traditionally diffusion of innovation has
been concerned only with new products, the concept can be applied to
existing products and brands, given the intense competition in almost
any product/service category.
Defining “New” Products

New products can be divided into products that are a result of:
1. continuous innovation;
2. dynamically continuous innovation;
3. discontinuous innovation based on the degree of innovation.
The division of “new” among products launched in the market is based on
two aspects:
1. the changes required in consumer behaviour to use the innovation;
2. degree of innovation.
Aeroplanes, computers and telephones were discontinuous innovations at

the period of time when they were invented, as both the degree of innovation
as well as the degree of changes required in consumer behaviour in adapting to
these innovations was high. When buying a digital camera or considering In-
ternet shopping, the change in behaviour on the part of the consumers is mod-
erate as is the degree of innovation. Hence, these will fall under dynamically
continuous innovations (since moderate changes of behaviour are involved
with regard to the two basic factors applied to diffusion of innovation). When
the remote switch of a TV is considered, consumers have to make only a small
change with regard to their behaviour (or practice) to use the remote along
with their TV. Hence, it is a continuous innovation.
The dimensions used for the classification of the “newness” of a prod-
uct should take a specific target segment's perception of “newness” into
account.
Diffusion and Existing Products

Diffusion can be applied to existing products. For example, marketers can
consider (i) categories, (if not brands), with which consumers are familiar;
(ii) brands with which consumers are familiar even if the categories are new
to them (because of high degree of advertising). New brands in familiar cat-
egories have to address diffusion problems differently from old brands in new
or unfamiliar categories. Relatively new brands in consumer durables like
Kenstar, LG, Samsung and Whirlpool have to follow a different kind of strat-
egy in order to compete with strongly entrenched brands. LG, for instance, has
been able to achieve significant diffusion by its focus on new features/benefits
in familiar product categories. LG's proposition in refrigerators was “preserva-
tion of nutrition”; in microwave ovens “health”; in washing machines “fabric
care”; in air-conditioners “healthy air” and in TVs, it was “relaxed viewing”
(golden eye). LG was able to capture a significant market share at the premium
end of the respective product categories. Whirlpool was also able to diffuse
itself in refrigerators by offering “Indianised” features based on research. San-
tro, in the automobile sector, diffused itself in the Indian market by offering
new features/design. Even in consumables, brands new to the market have
to adopt strategies with a strong differentiation. A brand called Pass Pass of-
fered dry fruits as a chewing option in direct competition with other chewing
products. Red Label, though a well-known brand, introduced a “nature care”
variant when faced with competition. This was a case of an old brand in a
familiar category reacting to competition. Britannia introduced a number of
variants to diffuse itself in the market. It created a new brand – Tiger – for the
lower end of the market. Reynolds offered pens with superior features and
gained acceptability.
There are categories like hair dyes, contact lenses and antiseptic lotions,
in which consumers may be familiar with brand names (Godrej in hair dyes,
Bauch & Lomb in contact lenses, Dettol in antiseptics). But these categories
8  Diffusion of Innovation: The Acceptance of New Products and Brands 211
Box 8.1
Brands that did not Diffuse in India
 Hina Peas frozen green peas

fromHLL (sixties)  ahead of its time?
 Merlin Home Theatre (eighties)  ahead of its time?
 An apple drink from Cadbury
(eighties)  ahead of its time?
 Dollops ice-cream from value perception?
Cadbury  positioning problems?
 Greatshake–the soya drink
in a tetrapack from Godrej  cultural habits?
 Nikytasha 3D TV  competitive advantage?
 Tang orange juice
(positioned as breakfast juice)  cultural habits?
 Paltab tablet-based soft-drink was there a need at
Boots (sixties)  all? (ahead of its time)
 Four-stroke scooters competitive advantage/
(Legend and Spectra)  value proposition
require concept-selling for consumers to understand the benefits and usage of

the products. Microwave ovens, a category that has been around for some years,
has a number of well-known brands. The brands in such categories should for-
mulate concept-selling in such a way that these product categories (and, hence,
specific brands) get prioritised in the minds of consumers. Marketers should
remember that diffusion of a product does not just depend only on competi-
tion between brands. It may also depend on competition between product cat-
egories. After being in the market for several years, washing machines sell in
much lesser numbers than the diffusion of personal computers. For instance,
a middle class household may prioritize a PC for education purposes over a
fully automatic washing machine. Demographics and psychographics play an
important role in generic competition across product categories.
Ice-creams can compete with chocolates, snacks and aerated soft drinks.
L'Oreal has done extensive concept-selling for its hair colours and has, per-
haps for the first time in India, positioned itself on the fashion statement
plank. This comes at a time when colouring hair is becoming a rage the
Box 8.2
Product Features and Brand Diffusion
A number of brands attempt to diffuse themselves by offering features
that may be relevant in the Indian context. Samsung introduced the “sari”
washcycle in its washing machines so that it did not get entangled. Samsung
and LG offer features in their microwave ovens that enable consumers to
prepare regional recipes. Philips has introduced plasma TVs in different
colours, from which consumers can select one that goes with their interior
décor. LG also introduced a TV that had its menu in a regional language.
Whirlpool, which entered the Indian market in the nineties, has a Rs. 250
crore sub-brand – Whitemagic – in the category of washing machine. The dis-
tinguishing feature of this model is the “agitator” movement, which is akin to
the hand-washing action.
world over. Companies in the contact lens market are using a variety of
strategies to diffuse the product. Positioning contact lenses as a fashion ac-
cessory is one of them (Bauch & Lomb). In a country like India, lowering
costs and, thereby, enhancing the total value of the offering (contact lens
and its subsequent care) should enable brands to diffuse faster in the mar-
ket.
A brand must maintain its pioneering lead, especially after it has gained ac-
ceptance in the market. Steel almirahs (cabinets) from Godrej have had a high
degree of credibility for the last several years but they were priced far higher
than competition in the unorganized sector. Doing a downward product-line
stretch would have helped in faster diffusion of the brand in the category. Park
Avenue, in the men's readymade clothes, has maintained its strong position
for the last several years by launching variants. Launching variants, inciden-
tally, has to be considered with regard to the cost involved. Cadbury, with its
variants, is an example. Amrutanjan and Iodex have been well-known brands
in the category of pain balms. These could have repositioned themselves with
variants in the recent times.
In certain categories, sustained and contemporary communication can
lend mileage to a pioneering brand. Bru, in instant coffee, is an example. After
establishing itself strongly on the “taste” attribute, the brand has been “up-
dating” its communication. Close-up also pioneered toothpaste gels and sus-
tained itself for several years before the market developed into a substantial
one for gel toothpastes. It effectively used communication strategies over a pe-
riod of time. Top brands (which can be considered as pioneers) – Coke, Kodak,
McDonald and Sony – have sustained themselves along with the growth of the
product category.
Characteristics of Diffusion of Innovation

The following are the distinctive characteristics of diffusion of innovation:
1. Competitive (relative) advantage: A new product, regardless of the category
of innovation, should offer a distinct advantage. Mobile telephones have
the advantage of being used when on the move. Walkman offered the
same advantage to music buffs. E-mails over snail-mails; mixers over
traditional methods of crushing; portable CD players and plasma TVs
over the conventional sets; all have definitive benefits. When marketers
consider competitive advantage in relative terms, they have to consider
(a) the target segment for the product and (b) the “value”, as perceived
by the consumer. For example, a first-time buyer (a typical upgrader
from the scooter) of the latest electric car in India will perceive its relative
advantage differently from the one who wants a second car for his/her
household at a price nearly equal to that of, say, a Maruti 800. This per-
ception will be different for the two segments in spite of the advantages
of the electric car, like compact size, environment-friendly features and
easy maneuverability. If shaving gels have to catch up in the Indian con-
text, they have to be priced competitively with creams. Value in price,
features and psychological satisfaction—the new offering must give these
and convey the value perception in the psyche of the consumer. Maruti
(when it was introduced during the eighties) in cars, Reynolds pen and
Bajaj Chetak are brands that captured the “value perception” of consum-
ers. Reynolds makes an interesting case of value being conveyed at a
higher price point. In a market full of unorganized “brands”, which com-
promised on quality, Reynolds followed skimming (higher-price than the
existing rivals when it was introduced), but it still created the “value” as-
sociation. Ariel was the first brand to launch compact detergents in India.
If the brand had created the value perception (cost per wash) in a realistic
manner, it may have been a more powerful pioneering brand in this sub-
category of detergents.
2. Compatibility: Marketers have to examine the extent to which a product
can be compatible with the existing habits, practices and cultural values
of consumers (target segment). Braun introduced shaving systems for
women. Though positioned for urban women, it may take some time
before the target segment is able to perceive the product as part of their
personal care. Reference groups and word-of-mouth concepts are ap-
plicable to the diffusion of such a product. A brand should not normally
communicate anything against the established practices and beliefs. If the
example of the electric car is extended to practices or habits of a people,
a consumer used to a conventional car (even if he/she is interested in
it as a second car) has to familiarise himself/herself with a new set of
usage practices—acceleration, charging batteries, driving within the city
limits, changing speeds etc. Electric toothbrushes (still available at some
shops in the US), introduced several years back, did not find favour with
consumers because of incompatibility and, perhaps, complexity. Some

brands of electric toothbrushes are found in a few shops in urban Indian
markets. Electric shavers (launched by Philips and Braun in India) may
also have to tide over such barriers before getting diffused in a significant
manner. Washing machines for human beings, introduced in Japan (in
which consumers could wash themselves), may also face the problems of
complexity. But it may find some takers due to its novelty value!
3. Complexity: Complexity of products can put off consumers, however tech-
nologically advanced they may be. Except for two-in-one music (audio-
cum-tape recorders) systems, there does not seem to be any convergence
product that has taken off in any part of the world (including Internet
TVs). However, in recent times mobile phones with added features such
as MP3 and camera appear to have gained acceptance. With significant
advances in mobile telephony (Blackberry, for example), brands would
be concentrating on 3G technologies. The success of convergence through
mobiles (voice and data applications) would largely depend on the
availability of infrastructure and also the extent to which such products
remain within the affordability of consumers. India is probably one of
Box 8.3
Diffusion with Hi-tech and Perceived Value—
Importance of Relative Advantage
The Japanese place a premium on personal hygiene. Toto Ltd., a leading
manufacturer of fixtures in Japan introduced the Smart Toilet in luxury,
hotel and health care markets. The product registered a significant degree
of diffusion despite its high price of around $ 7000. The “paperless toilet”
offers warm water—the pressure, direction and temperature of which
can be controlled by the user. The cushioned seat is dried by warm air
and some models even dispense a fragrance after use. Advanced features
may enable the user to monitor his/her body temperature, weight, blood
pressure and pulse rate. In a collaborative arrangement with Nippon
Telegraph and Telephone Public Corporation, information on these body
parameters can be processed and stored up to four months and the data
sent through a PC to a doctor for further analysis. The relative advantage
creating perceived value, enabled the product to diffuse significantly
(even though it is priced high). In certain situations, products find recep-
tivity among consumers even if the product is not part of well-established
habits/practices.
the markets where there has been an exponential diffusion of mobiles,

largely due to the declining prices. Millions of users are at the lower end
of the market and the tariffs of mobiles in India are probably the cheapest
in the world! Nokia had an interesting advertisement (TV commercial)
for its Maps and Navigation mobile phone variants. Its “turn left, turn
right” campaign demonstrates the power of navigation and shows how
a consumer is able to reach her destination in an autorikshaw using the
device without depending on anyone. Technological complexity may
discourage target consumers from buying such products. Watch-TV
is another example of an innovation that never took off in spite of the
“made-in-Japan” tag. Fear of technological obsolescence may be another
reason for consumers not buying a product. Consumers may wait longer
to invest in PCs, given that their prices have come crashing the last 10
years. The downward lower-end offerings from leading brands like HP
and Lenova adds credibility to the perception of consumers that they
will be able to obtain more “value” from the buy if they can wait longer.
Complexity is not just restricted to durable hi-tech products. Products
like contact lenses and hair dyes, may also diffuse slowly either due to
complicated usage or fear of usage. Easy-to-use proposition and cred-
ibility through product demonstration may enable marketers to grapple
with the perceived risks in such products.
4. Trialability: The extent to which a product can be tried out also affects
diffusion. This may be extremely important, especially for consumer
durable products like washing machines and microwave ovens, which
are not conspicuous products (like two-wheelers, watches, cars or fashion
apparel). Some of the brands of durables claim reduced usage of water or
lower consumption of power. Unless backed up by the ability to be dem-
onstrated at the point of purchase, the credibility of such claims would
remain questionable. A leading store dealing with household appliances
in the US has a retail show-room that permits consumers to use the offer-
ings and satisfy themselves on several benefits and applications. Such an
approach will be useful in the Indian context.
Does Diffusion of Innovation Follow a Pattern (Adop-

ter Categories)?
Traditionally, diffusion of innovation is supposed to follow a pattern with dis-
tinctive stages like innovators, early adopters, early majority, late majority and
laggards. While the categorization of different groups of consumers at vari-
ous points of time may be of relevance to marketers, the pattern of consumers
adopting a product may vary from one category to another and the traditional
curve may not hold good. Analyzing, specifically, the psychographics of inno-
vators (among the target segment) may enable a marketer to target consumers
who are likely to try the product. For example, the innovator segment for Levi's
jeans may be the modern youth in urban cities, who are highly fashion con-
scious. The basic logic of targeting innovators is to enable the diffusion of the
product among the target segment either by word of mouth or the influence of
“role models” (in fashion products). Targeting innovators may require a specific
thrust on a few marketing mix elements. For example, in the case of jeans, the
focus has to be on prime-area fashion outlets frequented by innovators. Organis-
ing fashion-related contests at select colleges may also help the fashion brand.
Campaigns in fashion magazines may help. In the case of consumer durables
also, innovators may be critical for the brand to diffuse.
Box 8.4
Diffusion in a Specific Market—Importance
of Product Compatibility with
Existing Practices
Compatibility is required between the new product and the practices
of consumers in a given target segment (social context/culture). Lacto-
gen advertised itself in third-world countries (Latin America, Africa and
Asia) with the slogan “Give your baby love and Lactogen”. While the
copy appealed to well-educated upper class consumers, it also triggered
off the “aspiration” of poor households that were unable to afford the
high-priced baby food. Hence, poor consumers bought the baby food and
diluted it. Besides, these consumers were not used to sterilising feeding
bottles. So, their babies fell sick. Lack of compatibility between consum-
ers' method of using the product (dilution, also did not have the desired
effect on the health of babies) and the new offering in the market created
barriers in the marketing success of Lactogen.
Germans value environment-friendly products but electric cars
have had difficulty in diffusing in the country as they are slow. Besides,
they cannot be used to cover long distances. Such vehicles have dif-
ficulty in getting diffused because consumers are used to fast, high-
powered cars.
When dishwashers were introduced in developed markets, marketers
found that they did not fit with kitchens for lack of appropriate space
for the product. Sun Direct TV, a TV channel service (cable TV) provider
used a pricing strategy to make consumers switch from the existing TV
channel providers (cable TV operators). There are millions of homes with
cable TV service. This brand advertised that a consumer can selectively
choose his/her channels and pay between Rs 15 and Rs 140. The channel
viewing consumers' existing practice is to pay a monthly fee to the cable
operator and get more than 100 TV channels. Consumers may not use
more than 10 –15 channels on a daily basis
Brands with social appeal (Scooty) and utility products (Tupperware), too,
require a positive word of mouth from innovators. In the case of utility-based
products, geo-demographic segmentation (a housing locality with a specific
lifestyle) may be useful. Demonstration at such places with a focus on selling
the products may generate word of mouth, which, in turn, will enable dif-
fusion among “followers”. Tupperware uses sales party plan method where
the demonstration of the product takes place at the residence of a host with
prospective consumers in the neighbourhood attending. An innovator in one
product category may not be an innovator in another category.
When the product/brand gets diffused over a period of time to the other
categories of consumers like early adopters etc., there may also be a need to
introduce variants as consumers become familiar with the product and may
start developing preferences for variants (as in Close-up toothpaste, Titan
watches, and ice-creams). The categorization of a brand in the diffusion phase
is possible with detailed research on target segments, potential for the product,
competition etc. Not all consumers (even in the target segment) may adopt the
product even in the “laggard” phase.
Another useful classification for diffusion of innovation for a new product
(sub-category) like the electric cooker is given in Figure 8.1.
Consumer types Strategy
Consumers who are unaware Concept selling about what

an electric cooker is
Symbolic rejectors know the Trigger word of mouth through

product but decide it is not personal sources of information
for them
Symbolic adopters like the Demonstration at retail outlets

product and get to try it after getting them to come to the
outlets
Trial adopters who have Create a priority by outlining

tried the product but not benefits (advertisements in
purchased it specific media vehicles)
Trial rejectors who have tried Researching the reasons–

the product but found it product development, if
lacking required, should be carried out
Figure 8.1  Diffusion of Innovation—Adopter Categories

Framework for Diffusion of Innovation

Two processes must be used together if a product/brand is to diffuse in through
the appropriate target segment. One is the adoption process consisting of aware-
ness, interest, evaluation and trial; the other is the innovation decision process
comprising knowledge, persuasion, decision, implementation (putting the prod-
uct to use) and confirmation (feeling reassured after using the product).
The combination of the two processes, usage of the characteristics of diffu-
sion of innovation and adopter categories, and the variation of marketing mix
elements (for a combination of stages in the two processes) will depend on:
(a) the nature of the product category; (b) the social context in which the prod-
uct is positioned; and (c) the level of awareness/perceived risk associated with
the product category.
The following sequence gives an indication about the approach for a brand
of electric shavers launched in the Indian context:
Phase 1 Awareness  Knowledge

Strategy
A well-known brand can reduce perceived risk. But apprehensions asso-

ciated with electric shavers will still have to be addressed not only through
communication, but also through effective demonstration at the retail outlets
(using company personnel). Researching a “niche” innovator and profiling are
prerequisites. Appropriate media vehicle is critical.
Box 8.5
Innovator Profile for Electric Cookers
Target segment: Married women in urban cities (nuclear families with
both husband and wife working). Demographics have
to be researched).
 willingness to have an additional cooker (electric). It is preferable to
choose housewives who are used to gas cookers and psychologically
conditioned to the concept of the cooker.
 working women who have to attend to multiple tasks before leaving
for office.
 married women who perceive little risk in the product.
 married women who are likely to talk about the new products they buy.
 married women who are oriented towards the “novelty appeal” of
their kitchen appliances.
 married women who watch specific programs on the TV or read
a specific magazine (appropriate media vehicle can be used to give
them useful information on the product/brand).
Phase 2 Interest  Persuasion

Strategy
A database on interested prospective consumers should be collected. This
can be done through a contest among the target segment using appropriate
media vehicles. One-to-one marketing should be done after the database is
obtained.
Phase 1 and Phase 2 should lead to positive evaluation.
Consumers who are interested in observing the trial may not visit retail
outlets (point of purchase) just to express their interest in electric shavers. Most
of the consumers would not make exclusive visits for this product. Hence, dem-
onstrations should be done at “high service” outlets where prospective con-
sumers visit for their regular shopping. High service outlets should be dedi-
cated to demonstration and spreading the benefits and usage of the product.
Phase 3 Decision  Implementation

Strategy
As consumers for this product category are not likely to be price-sensitive,
a discount may not be required to generate trials. Decision to buy could be
reinforced by allowing life-time free service (at least during the initial launch
period).
Phase 4 Confirmation
Strategy
This is, probably, the most critical aspect of the diffusion process. The sat-
isfaction levels associated with trials, positive word of mouth and subsequent
usage depends on this stage. All costs incurred by the brand at this stage should
be treated as an investment in brand-building. The following strategies can be
used in this stage.
1. In order to arrest dissonance (which may be just psychological), a full re-
fund should be provided to a consumer who expresses dissatisfaction for
a specified period.
2. An interactive division (accessible to the consumer at the cost of the
company, especially when most users are likely to own a mobile phone)
to help a consumer with product usage should be made available. The
consumer may lose interest in the product if he is not able to get online
suggestions when he requires them.
3. Apart from interactive assistance, the company should take the initia-
tive to have face-to-face contact with the consumer. Based on feedback,
it should strive to improve the product and ensure that consumers who
have bought the original version can exchange it for the new one free of
cost. This builds confidence among consumers who are associated with
the brand and hence, they are likely to enhance the word of mouth.
Box 8.6
Importance of Opinion Leaders
With advertising communication intensifying, consumers become
very discerning. They are more inclined on getting the opinion of a
group of people whom they think, are a credible lot. These opinion
leaders informally influence the attitudes and actions of opinion seek-
ers. They can be friends, colleagues or neighbours. A consumer who
wants to buy a home PC may seek information from an opinion leader
on specific brands. Opinion leadership reduces perceived risk, espe-
cially in durables or services (which is intangible). The opinion leader
may also be motivated by his/her association with the product, due
to social involvement or even due to the involvement in the marketing
communication novelty with regard to a product category. Opinion
leadership is category-specific. There may be different opinion leaders
in different product categories.
There may be a few opinion leaders called market mavens who
have information on several product categories, retail outlets or other
aspects concerned with product categories. The word of opinion lead-
ers may be extremely useful in the diffusion of a brand. A marketer
can create a robust online community, which not only helps build a
positive word of mouth but also helps in brand-building if it is done
in a structured manner. A brand of consumer electronics (TV or music
system) can establish an online club for members interested in the
programs/music titles. The brand can update information on these
counts and inform buyers about its latest offerings, as there may be
some consumers in the “replacement” phase. If the brand also has a
good social network (apart from good products), it will be perceived
as “friendly, warm and caring” over a period of time. In the present
day context, there cannot be a better advocate for the brand!
4. Finally, given the probable profile of innovators, there is scope for

community-oriented brand-building. For instance, the brand's club can
pursue a lifestyle interest that is common to the consumers belonging to
the club. It may be worthwhile to find out from consumers what kind
of lifestyle pastime will interest them and plan a promotional campaign
based on the feedback.
Companies need to be careful about online media like YouTube or Web
sites where the offering is being discussed. A good offering with strong func-
tional and service benefits is certain to have a good word of mouth.
Box 8.7
Convergence and Concepts of Diffusion
With advances in technology, convergence products enable brands to be
introduced in the market all over the world. Internet telephony, for ex-
ample, is taking off in some parts of the world, but it is perhaps too early
to predict if it will diffuse in a big way.
Huge investments are required to lay such networks. Some Jap-
anese companies have introduced advertising between messages to
strengthen the feasibility of operations. While diffusion may take
time, studies in Europe and the USA on mobile advertising indicate
that users who are initially drawn to such convergence products can
be retained through careful customization of services and online
information.
Nintendo, a Japanese brand of computer-based videogames, was one
of the fastest brands to be diffused in the US. Computer games were in-
novated by a firm called Atari (US) during the seventies. Nintendo used
academic concepts to achieve diffusion in a market where even retailers
were wary of changing the product because of the product offering's dis-
astrous marketing history associated with Atari. Nintendo had com-
petitive knowledge (high-resolution graphics) and a variety of games.
It could observe the diffusion graph because it controlled the demand for
its games.
Nintendo went on to become a rage in the country. The brand was
also introduced as Famicom to avoid its association with computers,
though it was computer based. Famicom, apart from sounding less com-
plex, would have also generated curiosity among consumers. Trials were
encouraged with kids being asked to try out the product. It was easy
to operate and was promoted during Christmas—at a time when peo-
ple shop for novel presents, especially for their children. Nintendo also
priced the brand to convey a value perception. It priced the hardware
less, but priced the software higher. Such an approach of the brand was
the “razor and blade” strategy.
Dimensions of Brand Diffusion

At a time when new products are proliferating, a marketer will want to know
how the target segment accepts the products over a period of time. It is import-
ant that consumers perceive the “newness” in a new product as a consequence
of marketing it.
Dimensions of “Newness” in a Product

It may be worthwhile to analyze the kinds of “newness” associated with
products and apply psychological factors to convey it. Product attributes can
create a feeling of uniqueness, especially in a highly-competitive category,
be it toothpaste, TV or washing machine. Though marketers always feel that
benefits are more important than features, consumers may also be drawn to-
wards features. A brand should ensure that the novelty of the feature gets
translated into functional benefits and emphasise the latter in its communica-
tion. Figure 8.2 explains the “novelty benefit” combination.
In the case of consumables, there is a need to introduce variants (after
careful research) or features (an outcome of technology). Internal costs and
profitability aspects are required to be studied before a brand plans the
variants, especially in a crowded market. Little Hearts from Britannia, Polo
from Nestle, the initial launch of Ariel's compact detergent, fairness creams
from Fair & Lovely and the variants in soaps are interesting examples of
how new brands gain acceptance by using either technology or product
variants.
The “newness” in durables can be a novel feature itself and the accom-
panying benefit may appeal to a section of consumers. In the example given in
Figure 8.2, the target segment is at the higher end of the TV market. In the case
of consumables, the novelty can be
1. unique taste/shape because of technology;

2. innovative strategies with a “value” – Sonata's watch offers a good
branded offering at the lower priced segment of the market against a
number of watch offerings from the unorganized sector.
3. Creating a concept that is acceptable to consumers based on the cul-
tural beliefs. Fair skin has always been perceived to be superior and
beautiful in the Indian context. Fair & Lovely is a dominant brand in
the fairness cream market. The brand has also triggered the growth
of this market in the last few years. Though a number of brands have
entered the market in the recent times and, perhaps, even broken the
monopoly of the pioneering brand, Fair & Lovely continues to be
the dominant brand in the category associated with fairness creams.
When a brand successfully introduces a concept acceptable to the
consumer, brand-building efforts enable the brand to be perceived fa-
vourably. Such efforts create a brand image with the relevant associa-
tions vital for a brand, and attempts to diffuse a new concept. If this
aspect of consumer behaviour is not employed, the brand will end up
in just conveying the concept while the “follower” brands capitalise
on the “category awareness” (created by the pioneering brand). Taj is
a brand in tea bags that has not only created awareness in a new prod-
uct category (of tea bags) but also created brand associations.
Awareness of a novel feature Qudra

Point Focus (QPF)/
“Golden Eye”
Follow up after awareness How does it improve

the performance
Reinforcement of the message at Demonstration linking

retail outlets (for durables) QPF/Golden Eye with TV
viewing
Figure 8.2  Dimensions of Newness in a Brand
Value in Durables
As in the case of Nirma in detergents, a brand of durables can also create “new-
ness” with a value proposition. Akai, which practically formalised the second-
hand market for televisions through retail outlets, is a good example for creating
value in durables for expanding the market and diffusing the brand. It is vital
that such brands retain this “value” in the long run so that the brand can sustain
diffusion when competitive brands follow. This is a common problem associated
with incremental “newness” introduced by brands in a crowded market. In re-
cent times, a brand has to commit itself to a proposition, especially if it is “value”
for the lower-end market, to ensure that the brand continues to get diffused.
Symbolism as Newness in Durables

Symbolism also can be used in durables (as in the case of cosmetics, apparel
etc.). Onida used symbolism to its advantage in a TV market, which was just de-
veloping, during the mid-eighties. “Neighbour's envy, owner's pride”, pushed
the price to the background and created a higher-end segment that was able to
associate with this appeal at a time when television was still a symbolic product
to be displayed in the drawing hall of the house. But as in value, a brand can
sustain itself on the platform of symbolism by launching innovative products
which will appeal to the innovators. This, it can do by combining symbolism
with innovative features that enhance the psychological feeling of the owner of
a particular brand. This is different from the novelty appeal discussed earlier,
which appeals to the curiosity of the consumer. In-depth research is required to
find out the feasibility of such products for innovators. The earlier version of pic-
ture telephones by AT & T and TV-watches by some Japanese brands failed be-
cause the role of innovators was not duly considered. Innovators are extremely
important in the cycle of innovation, especially in durables, because of the word
of mouth involved in the diffusion of products. Service provided during the
launch of the new product is as vital as the latter's novelty. The service also influ-
ences the word of mouth, which has an impact on prospective consumers.
The Power of Trial

While marketers offer test-drives of automobiles to give consumers a feel of
the brand, trials can be used powerfully even for the diffusion of a common-
place product like a dish-washing bar. This is a market that has “no-cost” al-
ternatives such as ash and sand. Vim Bar, in its improved version, adopted an
effective sales promotion scheme along with a unique “challenge-based” pro-
motion to enhance brand trials. Rin Supreme, marketed by the same company,
and with a high level of penetration, roped in Vim Bar in a sales promotional
scheme. The brand also sampled the product among the target segment with
an assurance of providing a year's supply of the product if the consumer was
not satisfied with the sample. The offer was filmed and the advertising cam-
paign created on this basis enhanced the visibility of the brand apart from
improving the word of mouth. In the case of durables like washing machines,
a brand can combine demonstration with trial to increase the credibility of its
proposition (such as saving electricity, removal of dirt though a specific and
unique action etc.). It is surprising that in a highly competitive market with
widespread exchange offers and freebies, demonstration/trials at the point of
purchase is not adopted as a brand strategy.
Functional Utility
While value is worthiness of a product for a specific price point, functional
utility has to be analyzed in terms of convenience, ease of use or the manner
in which the product benefits the consumer. Though value is important, an
intensive analysis of functional utility can help a brand capture the percep-
tion of consumers on its “newness”. Consumers readily pay a premium on
shampoo sachets even at the lower end of the market because of the con-
venience and lower unit cost. This, in spite of the fact that some sachets
cost more than the regular size shampoo bottles in terms of per ml cost.
Weighing the functional utility against the novelty appeal may be important
in certain categories. Four-stroke, by itself, is a favourable feature in two-
wheelers. But consumers may compare the feature with its utility. Honda
Activa's design, features and comfort may have appealed to several seg-
ments of consumers.
The brand has a leading market share in the scooter market that got kick-
started after the market in this segment (Bajaj was a leading brand in the cat-
egory for several years) almost declined.
A combination of factors has to be considered while formulating strategies
for the diffusion of products/brands. Detergents, shampoos or food are cat-
egories in which consumers in the lower strata buy low unit cost packs to exert
expenditure control. They attempt to consume less by buying low unit cost
packs, and this kind of buying may result in an overall saving in the household
budget. Marketing communication should emphasise product application costs

(wherever applicable) to ensure faster diffusion of the brand.
Why Do Brands Fail?

In an era of brand loyalty and brand experience, it is important that market-
ers analyze why brands fail. There may be several reasons, both internal and
external to the organization, for the failure.
Category Development
Normally, brands evolve as categories and develop over a period of time.
Soaps, biscuits, shampoos, pens, washing machines and audio products are a
few examples. If a category does not evolve, chances are that consumers don't
perceive it favourably. Or, they do not understand the nature of the product
and so do not take it into their “consideration set”. A lot of research is required
on marketing mix elements to ensure that the category registers with the target
segment. The onus of doing the research is on one of the pioneering brands
that kick-starts the category. While this meant creating awareness some decades
ago, it is a complicated exercise in the current context. Red Label, Horlicks, Surf,
Dettol, Colgate, Cadbury and Scissors may be some of the classic brands that
had been responsible for the growth of their respective categories. Incidentally,
all these brands have also run successful advertising campaigns over the past
several years. While some of them may have faced intensive competition in the
recent years, they have also been a part of product history in the Indian market.
Brylcream is a brand that may have contributed to the growth of the hair
cream market. It has attempted to revive itself in the recent times. Clinic, the
well-known shampoo brand, also moved into hair creams. Brylcream was the
pioneering brand in the category. Despite using a celebrity even during the
seventies, the category did not grow even though there has been sufficient
interest in personal grooming. There are certain interesting questions regard-
ing the product category:
 What was the target segment for the brand when it was launched: execu-
tives, men who travelled on work or the younger segment, which fol-
lowed a particular lifestyle?
 What were the brand benefits: convenience in carrying the pack (as against
a hair oil bottle) or better grooming?
 Did pricing restrict the growth of the brand (vis-à-vis hair oil) and, if so,
did the brand attempt niche marketing strategies?
 What was the perception of consumers on counts of the frequency of
usage, hair styling and “stickiness”?
Given this scenario, it is not difficult to understand why several brands are
not found in the category. Development of the category, especially by the early
brands in it, determines not only the success of such brands but also how sub-
sequent brands perform in the category. This is not to say that the latter will
not succeed in developing that category. In fact, there are several that have
successfully done so. A pioneering brand can become synonymous with its
category and hence, be the first in the mind of the consumer. Later, it can make
appropriate changes in the marketing mix to ensure it leads with a sustain-
able advantage. Close-up in gel toothpastes is a good example to show that a
brand can succeed after pioneering the sub-category, even though it may take
time to succeed. Ariel had introduced the sub-category of compact detergents.
After Shower, the hair cream from Parachute has made rapid strides in recent
times in the category of hair creams. Communication had focused on the style
aspects of personal grooming and also included a celebrity.
Timing of the Brand

Timing of a brand is important. There are two options for a brand to diffuse it-
self. It can either introduce a new concept and wait for the market to develop
and accept it or introduce a new concept when the timing is right. The former
approach demands more money, time and organizational resources. The lat-
ter can be successful if there is adequate and ongoing research on consumer
behaviour. Time-share in the vacationing market has evolved in India and is
still a niche segment. A brand attempted this in the mid-eighties. The timing
for pure fruit juices in toady's context is probably right, even though it is still
a niche market. For nearly two decades, there was only one brand of pure
apple juice. Hima Peas, a brand of frozen green peas, was introduced during
the sixties when lifestyles were far more laidback than they are today and
people were not under pressure to buy frozen vegetables. Hero Honda's ini-
tial proposition of economy timed well with consumers willing to purchase
two-wheelers for personal transport, and the improved purchasing power
of the target segment. Brands in commodity items like salt and flour have
been introduced when consumers need convenience and good quality. There
may even be situations in which timing plays a role with regard to changing
lifestyles.
Contact lenses have been in the country for the last 30 years. Many con-
sumers gave up the product after trying it. The branded offerings that have
been in the market for the last few years have attempted to market the prod-
uct through a mix of strategies. Changing lifestyles, coupled with aspects of
convenience and personal grooming, may have changed consumer perception
of contact lenses. Brands should adopt a well-structured strategy beginning
with the identification of appropriate segments. Baby powders are another
product category wherein a number of brands failed to make progress in a
niche market (like Pond's and Glaxo). A related market of baby soaps has seen
a few brands in the recent times. Given the awareness of consumers, afford-
ability and the attitude of parents towards child care, it may be appropriate
to build brands in such categories though the market for such products may
only be niche. Brands like Itch-Guard and Krack have timed their launch well.
Offering for the elderly is a market that needs to be explored in India. Cadbury
has introduced Cadbury Lite for diabetics.
Cultural Dimensions
Culture is unique to a market and can offset several attempts of marketers. The
clear lemon drink in the carbonated beverages or soft drink market (Campa
Lime or Sprint in the eighties, or the bitter lime popular in the West) may not
do too well in the country because they are not a part of its culture, and eating
and drinking are strong cultural habits. While a number of consumer products
may get diffused because of changing lifestyles, food products that are not a
part of a culture will meet with resistance. Bread has low penetration levels in
several parts of the country even though it has been around for a long time.
The reasoning also holds good for shaving systems for women (Braun). Herbal
soaps and shampoos, which have built brands on cultural practices, associ-
ated themselves with the usage of such ingredients (Refer Plate 10). Godrej's
Storewell advertisements of steel cabinets used traditional marriage occasions
at its theme. Brands that are associated with strongly-entrenched cultural prac-
tices/beliefs, have to be careful before using a Western appeal. The core benefit
of Fair & Lovely, the leading fairness brand, draws from cultural beliefs. The
brand has also launched a herbal variant. The concept of “family soap” in the
soap category does not seem to have done too well. Protex from Colgate and
All Care from Godrej offer this proposition. Family togetherness as a social
trait is, perhaps, stronger in the rural areas because urban nuclear families have
strong individual preferences for FMCG categories. Lifebuoy has re-launched
itself as a family soap. The brand, incidentally, has a huge market in rural areas.
Nestle introduced its dark chocolate version in India, and the variant is no
longer there in the market. Bournville, the bitter chocolate brand from Cad-
bury, has been in the Indian market for a long time but caters to a small niche.
Cadbury has been instrumental in expanding the market for chocolates among
adults. New concept products can target youth. The advantage of targeting
the young is that they are more open to new tastes than the older consumers.
The youth may also be more amenable to changing habits. It is worthwhile
for marketing academia and practitioners to give as much importance to failed
brands as to the successful ones.
Branding the Unknown—Strategies for

“Small” Brands
Fairever in creams, Nirma in detergents, T-Series in cassettes and MTR
(Bangalore-based company) in fast foods have stood out in a marketing area
that deals with high-visibility advertising and expensive promotional “push”.
While major brands like Titan, Britannia and Colgate have used marketing
concepts to build brands in a highly competitive scenario, marketing princi-
ples are equally applicable to brands that are manufactured in the small-scale
sector. This is particularly true in the Indian context, which offers tremendous
potential for value-based offerings, given the proliferation of unorganized
markets in several categories like batteries, watches, biscuits, UPS, computers,
moulded luggage, cassettes, detergents, sewing machines, ice-creams, jewel-
lery, footwear and readymade apparel.
The Basics
An unknown product manufactured in the small-scale industry has to com-
pete with several established offerings, especially brands that have been in the
market for several decades. The unknown offering has to build itself up as a
brand with limited resources—in terms of advertising, distribution network
and financial outflow. Consumers are becoming extremely discerning, apart
from the fact that they have far more choices today. Several decades back, even
established brands used to “float” their offerings in the market because compe-
tition was not very intense.
A small-scale offering must research the market and select the appropri-
ate target segment. While there is nothing new about doing this, it is true that
the rule is practised more in its breach than observance. This is the founda-
tion strategy for a small-scale unit as mistakes may be irreversible. Hindustan
Lever can afford to introduce a variant of Close-up and remove it from the
market, but such experimentation on product launches will not be feasible in a
small-scale company. There are a few aspects that need consideration before a
small-scale firm segments the market. Segmentation, here, refers to geograph-
ical, psychographic and demographic characteristics of the target consumers.
Caution 1: Non-branded offerings in the

market—Scope for new offerings
A typical example is herbal soaps. While mega brands battle it out in an adver-
tising dominated category, Medimix has carved a niche for itself in the South
Indian markets. In fact, there are several such brands in some other markets,
like Krishna Tulasi. Even Hindustan Lever has a herbal variant of the well-
known Hamam. Mega brands may follow pioneers (herbal variant of Fair &
Lovely followed Fairever). This cannot be avoided. But the pioneering offering
can build itself as a brand by being on top of the mind of the consumers. Prod-
uct categories, which can be researched on similar lines, are baby foods, toys
and traditional snacks and eatables.
Caution 2: Value matters

Consumers look for value, which is nothing but enhanced utility at a given
price point. Enhanced utility can range from functional features of a tooth-
brush to an “experience” in a hospital or clinic. Value-orientation is so strong
that small-scale industries can compete with mega brands like the way Nirma
did in the detergents market. While Vim is a major brand in the category of
scouring powders, Sabeena has a significant share in South India and Shine is
a popular brand in Western markets. Value has to be delivered at a lower price
point, especially in a market where small-scale offerings will compete with
mega brands. The latter have consistently followed this strategy. There were
several small-scale offerings among ball pens but none of the brands had a
value propositioned like Reynolds. There are several offerings in biscuits but
none offered the value of Tiger. Heavy advertising may have had an incremen-
tal impact on the acceptance of these brands. But the core product at a specific
price point attracted consumers to try out and remain with these brands. In
fact, Reynolds delivered value at a higher price point. It is an accepted fact
the world over that word of mouth is the most effective advocate of a brand,
and any offering from the small-scale sector has to take this into consideration.
There are several regional brands of clocks, which sell by word of mouth. Gold
Winner is a regional brand of edible oil that advertised in regional channels.
Caution 3: Do not overlook premium niche markets

Contrary to the popular perception, small-scale offerings can develop a pre-
mium niche market even in established product categories if such niches are
identified properly. As mentioned earlier, small scale offerings should avoid
mega brands. But if they have to, for some reason, compete with the latter, they
must identify premium niches. While there are several packaged tea brands,
a few brands of flavoured tea have appeared in the market through modern
retailing. While these variants are available in limited outlets, a brand can be
built at a high price in a geographical area where there is a demand for such
offerings. While Titan and Ajanta may be well-known brands, an enterpris-
ing marketer has built a small niche for a clock cased in sandalwood, which is
priced at a premium. Furniture is another category that offers potential for a
premium niche.
Caution 4: Cluttered retailing is to be avoided

A small-scale offering has to be very selective about the manner in which it
chooses its retail network. This has to be done along with the “value” proposition.
But the suggested retailing approach cannot be a substitute for a bad offering.
Mega brands with their established “push and pull” strategies have little space
for unknown brands to compete with them. Hence, a prudent strategy for an
unknown brand to establish itself, is to find shelf space at upcoming depart-
mental outlets in upper middle class localities like Food World or Nilgiris.
A number of unknown offerings in foods, candies, shampoos and floor-cleaners
are already implementing this approach. This will be particularly effective be-
cause of the thrust of departmental stores on cultivating “store brands”. Once
a brand gets established at such retail outlets, it can slowly develop a retail
network in a specific geographical market. Starting with the usual “grocery
store” approach will be difficult for unknown brands. Besides competition,
there may also be doubts about quality perception.
Caution 5: Planning a promotional strategy

A careful planning is a must for using promotional methods, as expensive ad-
vertising is ruled out. Advertising on cable television may be cost effective
but a brand has to make sure that the message reaches the target segment.
FM radio stations have reactivated the interest of marketers with regard to
radio as a media. Stations like Radio City may be very useful to advertise life-
style products like jeans or goggles, even if they are offered by an unknown
brand. Given the profile of listeners, at least a section of them are likely to
consider new offerings after becoming aware of them through such media ve-
hicles. Point-of-purchase posters can be useful at specific retail outlets, espe-
cially for eatables and commodities. Regardless of the promotional mix used,
an unknown brand should clearly convey its USP over the established ones at
a given price point because comparing price points is part of the Indian con-
sumer's behaviour. Event marketing, normally thought to be the preserve of
mega brands, is a very effective tool if the target segment is chosen with care.
Organizing an event in a women's fashion institute/beauty parlor, will create
more awareness than advertisements in a shopping guide. The event has to be
novel as well as meaningful to the product category and the brand.
While certain strategies have been suggested, these by themselves cannot
guarantee success. They need to be customized to a specific product/ market
situation. While elaborate marketing research may be beyond the reach of the
small-scale sector, it must attempt to build a knowledge base of consumer be-
haviour in whatever way it can. It is this base that can provide vital inputs to
customize strategies.
Barrier Breakers: An Application of the Concept of

Diffusion of Innovation
Insta Care, a well-known multinational in the field of eye-care and opthal-
mics, entered the Indian market in 1992. The company had invested around
Rs 75 crore in Pune to set up a factory, which would produce eight lakh units
of contact lenses per annum. Given the huge market in Indian eye-care, the
company's intention was to pioneer and create a market for contact lenses.
Contact lenses are not new to India. People used them even in the late sixties.
But no major player had made a concerted effect to market the product in a
professional manner. There were six small manufacturers who manufactured
the product and sold it to a few ophthalmologists and ophthalmic opticians.
Insta Care made its estimates about the potential of the product in the follow-
ing manner:
About 40 percent of the Indian population required some kind of vision
correction. Even if 1 percent of these patients opted for contact lenses, the po-
tential would be somewhere around 10 million units. Given the replacement
cycle and product variants that could be introduced slowly, the company felt
it could become the unassailable leader in the product category. Given the fact
that Insta Care was a leading player in some of the developed countries and
was backed by research, there seemed to be little risk in attempting to enter
the Indian market.
Mittal, Marketing Manager, Insta Care was recapitulating the strategies of
the company on a monthly visit to the corporate headquarters of the com-
pany at New Delhi. He joined the company in December 1995 and was based
in Bombay. He knew the company had committed certain fundamental mar-
keting mistakes in the last three years. With a new concept product like con-
tact lenses, (“new” because consumer acceptance over the last two decades
has been low), an in-depth analysis of consumer behaviour would have been
invaluable. The company had banked more on the statistical route to get its
estimates rather than getting to the underpinnings of consumer mindset. The
company's initial market study was sketchy. It concentrated on potential esti-
mation and found that about four lakh lenses could be sold in 1992. The report
also projected the figure over the next seven years and placed it at around one
million by 2000 AD. On the behavioural angle, the study just probed into the
perception of consumers from the viewpoint of convenience. But this study
was unprofessional and superficial, according to Mittal.
Strategy of Insta Care

The company launched an advertising campaign, which concentrated on the
aesthetic appeal of contact lenses. The TV commercial showed a group of
young adults making fun of a friend because she wore spectacles. The model
in the advertisement uses contact lenses and becomes the cynosure of all eyes
as it were. The TV commercial ran for almost a year. During this time the com-
pany organized what it called “easy-vision camps” in schools, colleges and
offices. The company demonstrated how to use contact lenses with doctors
answering queries of the audience. The company also provided free trials of
lenses during the camp. The camp was restricted to select institutions/orga-
nizations in urban cities. A year after the launch, the company also went on a
huge sales promotion campaign that offered free gifts like cooling glasses and
clocks against the purchase of lenses over a particular billing. The distribution
strategy was surprisingly unusual. The company set up a network of optical
dealers in around 200 cities and towns. Except for metros where a qualified
practitioner was attached to each outlet in the evenings, the other outlets had
“eye care-takers”, employed by the respective optical dealer. Optical dealers
in metros had to take the company's approval for hiring practitioners, but the
latter did not insist on this condition for other towns. The reason was that op-
tical dealers were unable to find practitioners who met the job specifications
of the company. A consolidated sum was paid to the practitioner in a metro,
apart from fees on a per-patient basis. In other towns, the “eye care-takers”
were paid on a per-patient basis. The company reimbursed 60 percent of the
payment. The services were available at all the outlets only in the evenings.
Contact lenses can be of three kinds: the semi-soft or rigid gas permeable
(RGP) lenses, which allow free movement of oxygen between the lens and
the cornea; soft lenses which have a higher percentage of water content, and
frequent replacement or disposable lenses. Soft lenses have an advantage
over RGP lenses as they don't draw too much of dust. Insta Care introduced
soft lenses (called Insta Care) for the first time in India when most consumers
were using RGP. Soft lenses differentiated themselves from RGP lenses, which
were sold by small players in specific regions with the help of practitioners.
There were some dealers also in some of these regions but their influence on
consumers was insignificant. Insta Care marketed its lenses in the range of
Rs 1200–1600 a pair. Added to this was the cost of cleaning and maintenance
solutions amounting to about Rs 100 a month. These lenses can last for about
a year. The company's turnover in 1995 was around Rs 25 crore.
Competition
Clear Vision, yet another multinational in the eye-care market, entered India in
1994. The company believed that the product was too “technical” for consum-
ers to pick up off the shelf. The company's market survey indicated that a ma-
jority of the urban people with vision problems visited an ophthalmologist. The
concept of optometrists, who specialised in vision correction, had not caught
on in India. The long-term objective of this company was to expand the market
through optometrists. As this objective would have taken time to accomplish,
the company made distribution network as its priority. It felt that the techni-
calities of the product needed to be customized to specific consumer needs.
So, it launched the product in 10 cities. It approached well-known practitio-
ners and opticians in these cities to form a network through which its brand
credibility could be enhanced.
The company entered the market with regular soft lenses but a year later,
introduced disposable lenses. The idea behind the new offering was that dis-
posable lenses dominate the global market. Apart from this, there was the dif-
ferentiation aspect of disposable lenses that provided certain advantages over
the regular ones. They were more hygienic, facilitated better vision and were
easy to maintain. This could have been a move to pre-empt Insta Care, which
also had its disposable lenses in the other markets of the world. Their price
ranged between Rs 3000–3500 for a pair. The company branded this offering
as “Crystal” with a six-monthly replacement package. Consumer feedback
encouraged the company to launch its best-selling brand abroad called Free-
dom which was a monthly disposable lens. Unlike its competitor, Clear Vision
had a low-profile media campaign, which highlighted the convenience of dis-
posable lenses. The company used practitioners to push its soft lenses and
disposables. It believed that “pull” strategies will not work well at that stage
of market evolution without the usual heavy advertising and high visibility
drives, which the company felt would be wasteful. It identified opticians in
Bombay and Bangalore, who catered to upmarket consumers. And then, it
introduced a cosmetic product-line for them. These cosmetic lenses came in
six colours and targeted the upmarket party-goer who would use these lenses
for their snob appeal. These were priced between Rs 4000–5000 a pair. It was
called “Showtime”.
A Research Study
Mittal was convinced that the future strategies of Insta Care will emerge from
more serious market probing. He selected the following issues, which needed
to be addressed by the research study:
 What is the current user base of contact lenses?
 What is the consumer perception of contact lenses?
 Do consumers perceive cosmetic benefits or functional benefits from
using contacts?
 What is the word-of-mouth on contact lenses, in general, from users?
 What is the feedback from the users of Insta Care?
 How exactly does a consumer decide on buying contact lenses?
 Perception of consumer disposables.
Mittal felt these issues, apart from demographic data, would provide a
strong base for his future decisions.
Six months later, Mittal was going through the marketing research report
submitted by an agency that covered 13 cities. They study used a sample of
5000 consumers (past and potential users in the income bracket of Rs 15,000
plus per month). The pilot study showed that the lower economic segment
was not interested in the product.
The highlights of the study were:
(a) Eight lakh people use contact lens currently (obtained by the agency
from several sources).
(b) Around 70 percent of the users gave up contacts and switched back to
spectacles. Of these, 50 percent were users of RGP (hard or semi-soft
1enses).
(c) The perception of most non-users was that contact lenses:
— are made of glass and harmful for the eyes
— are difficult to use
— can break easily
— are far more expensive than spectacles, which last for years
— are difficult to maintain.
(d) A majority of the users perceived the functional benefit of conveni-
ence associated with the product. About 30 percent of the non-users
associated “looks” with contact lenses. Among users, pre-dominantly
those who used RGP ones, there was dissatisfaction regarding clarity of
vision.
(e) Users bad-mouthed contact lenses on performance, price and weekly
maintenance. Most of them used the RGP lenses.
(f) Most consumers who had tried Insta Care were satisfied with the prod-
uct but felt that the product was far too expensive a replacement for spec-
tacles. About 20 percent users complained of a bad fit.
(g) The pattern of consumer usage that emerged from the research study is
(h) A majority of the non-users and users perceived disposable lenses as of-
fering an additional benefit—there was no maintenance involved. But
most of them also considered the price as a demotivator. Respondents
said they would wait for prices to come down before deciding on buying
disposables.
Mittal was reminded of the innovation–decision model, which he was
forced to go through as a part of his consumer behaviour program during his
student days (Table 8.1).
Table 8.1  Innovation–Decision Model
Stage Relevance to the case

Knowledge Lack of understanding of the product itself.
Persuasion Negative attitude because of bad word of mouth
of RPG users.
Need to create awareness not only on contact
lenses but also soft lenses.
Decision Consumer not convinced about the price of contact
lenses. What kind of value can be introduced?
Implementation Customisation of lenses can play a vital role.
Confirmation Strategies to retain existing lens users.
Promotional Issues for the Diffusion of the Product

(a) What is the functional benefit of both the product category and the brand?
(b) How can contact lenses fit in with the users of spectacles? (Barriers on
usage aspects)
(c) Complex nature of customisation – Implications on consumer behaviour?
— Encouraging the consumer to go to the expert doctor/optician.
(d) How can potential consumers try out the product?
(e) How can the “visibility” of satisfied lens users (of the brand) be created?
Word of mouth from a friend/eye doctor

(Eye doctors accounted for 70 percent)
Contemplates but does not seek

information on his/her own
Time-frame Not less than
involved six months
Reminded by the eye doctor
Brand recommended by the same doctor
Decides to buy from a dealer suggested

by the eye doctor
Figure 8.3  Consumer Decision Making Sequence.
Touch of Reality
Price Matters, but It Is not the Only Factor
The Indian water purifier market is yet to be developed, with 81% of
urban population drinking water directly from taps, or without safe
purifiers. Aquasure and Pureit aimed at the lower end of the mar-
ket (below Rs 2000) and have registered huge growth. Apart from the
price factor, there are beliefs to be changed. According to top manage-
ment personnel in the industry, Indians believe in only what they see
and anything they cannot see cannot be harmful. They have a strong
belief about traditional methods of water purification, though aware-
ness is on the increase among consumers. 60% of the sale occurs dur-
ing the monsoon season. Around 6000 sales personnel sell Aquaguard
through direct selling. Kent brand uses a celebrity to break the clutter
and enhance customer confidence. 50% of the sale happens through
word of mouth. After-sales-service contributes to 60% of the Eureka
Forbes revenues. It has a service network in 500 towns. Aquasure, the
lower-priced model from Eureka Forbes is marketed through retail-
ers. Hindustan Unilever that sells Pureit has set up Safe Water Zones
across the country to answer the queries of prospective consumers.
This is one category that depends on purely functional benefits and
such categories rely heavily on word of mouth among consumers to
gain priority among their purchases.
Diffusion in Emerging Markets—From

Functionality to Glamour
Opportunity of low penetration of brands

Different brands attempt different strategies to get diffused in the re-
spective categories. Lipton Iced Tea introduced the powder variant.
Dettol advertises on a variety of applications that include keeping germs
away from the steering wheel of the car. Maggi introduced sachets with
a cap. Fair & Handsome introduced a Rs 5 pack to increase trialability.
Film celebrities have been used to diffuse fad-life products. Dev Anand's
hat (Jewel Thief) of the sixties, Rajesh Khanna's stereotype of a hand-
some man with a motorcycle (Andaz) during the seventies and apparel
branded as “Om Shamthi Om” during the recent times are examples.
Gillette's Vector Plus advertises its twin-edged blades as a durable offer-
ing at an affordable price (when the shaving blade market is dominated
by conventional blades). Cadbury and Nestle introduced liquid choco-
lates at a low price point. Tex, a brand of toilet cleaner, positioned it-
self as a better alternative to acid with a low priced packaging. Shampoo
brands from P & G and Unilever are available in sachet packs. Parachute
pioneered low-priced packs in hair oil (Refer Plate 11). Given the large
Indian population, even a miniscule additional penetration of the market
will bring in a large volume of users for a brand.
Technologies, Company Strategies,

Consumer Appeal and Diffusion
It is interesting to note that a company's strategy and its policy on sev-
eral aspects concerning the offering have implications on diffusion of the
product in the respective market. Decades back, Sony's Betamax format
of video recording failed. Matsushita came out with its VHS format and
opened up the format to its competitors and succeeded not only with
its brand but also in expanding the market for video recorders. Apple's
Mac initially had a tight control over the application of the offering,
only to be out-marketed in the mass market by Microsoft with its vari-
ous windows applications. Microsoft encouraged several programers to
write up applications for its software, unlike Apple's approach of con-
trolling its device. iPhone, with all its features, runs only on AT&T net-
work. Apple's TV that creates digital images of videos on large screens
works only with its Mac and iTunes. iPod connects with iTunes and Mac.
The decision of a brand to open up its hardware and software in the do-
main of convergence technologies has a tremendous impact on diffusion
of such consumer products. This is increasingly important in this digital
age, in which consumer appeal to such products seems to be spontan-
eous. It may be a difficult for the brand to take a decision on whether it
should allow an innovation to freely diffuse in the market or to exert con-
trol on the innovation. “Innovators”, the first set of consumers who try
out a product /brand, especially when the brand is popular and unique,
develop an appeal for the novelty of a technology, or the symbolism gen-
erated by the brand or both. iPhone sold 1.7 million units in a period of
nine months in 2008. Apple advanced its launch of 3G iPhone (third gen-
eration variant) to 11th July 2008 from the initial Christmas launch. Con-
sumers (“innovators”) in the diffusion cycle queued up at the New York
Fifth Avenue outlet of Apple to be the first set of consumers to buy it –
they even spent nights sleeping before the outlet to acquire the “status”
of innovators. The 3G version is supposed to be twice as fast as the earlier
version, with a wide screen, camera, music download features, advanced
“push” e-mail and is supported by blue tooth. India, at present, does not
have the 3G infrastructure, and even the earlier version of iPhone was not
meant to work in India. As convergence products proliferate and compe-
tition intensifies, a brand like Apple may decide to quickly cash-in on the
first wave of excitement of “innovators” who trigger the powerful word
of mouth, the digital way.
9
The Concept of Reference Groups

and Their Implications on Branding
 Sachin Tendulkar appeared in the Palio sports car advertisements;

 Amitabh Bachchan endorsed the BPL brand;
 The traditional Indian grandma endorsed Ayurvedic Concepts (now Hi-
malaya brand), which offer a number of over-the-counter remedies based
on the traditional Indian medicinal system of Ayurveda;
 Lux soap has been in the Indian market for decades using a topical celeb-
rity;
 Gold Flake (and Charms during the eighties) projects the brand as being
popular among young people. Bacardi also used the “group” to market
its brand of liquor.
The above-mentioned appeals use what is called the reference group concept.
A reference group is a set of people with whom individuals compare them-
selves to shape their attitudes, values, knowledge and behaviour (including
buying behaviour). Brands use these concepts in a number of situations, and
celebrity usage is a vital application. A brand derives value from celebrity
associations if celebrity usage happens in a conceptual manner. Marketers
should know the aspirational groups with which target consumers may want
to associate themselves. These aspirational groups have to be represented in a
manner that will appeal to target consumers.
Types of Reference Groups

There can be three kinds of reference groups. The aspirational group is one
which the consumer admires and likes to emulate but of which he/she is not
a member. The consumer does not have a face-to-face contact with this group.
Hence, this is a secondary group.
Associative reference groups are those to which the consumer belongs.

These may be his/her friends, family, college peers, sports club co-members
and professional groups etc. The consumer has a face-to-face contact with the
group. Hence, this is a primary group. Besides aspirational groups, associa-
tive groups are also useful to marketers in positioning strategies. For example,
Allen Solly, with its semi-formal apparel, would have appealed to specific pro-
fessional groups like software and advertising professionals who work in an
informal culture. The very successful “Lalitaji” campaign from Surf during
the eighties would have appealed to a number of middle-class homemakers
because they would have identified themselves with Lalitaji. While there may
have been an overtone of aspiration in the “hard-bargaining” character of Lali-
taji, it typified the behaviour of a middle-class housewife. Dissociative groups
are those that the consumer may like to avoid. McDonald decided not to use
Ronald McDonald in its advertisements for the West Asian market because it
felt religious consumers may avoid the trendy and zany model.
Reference groups can also be defined on the basis of degree of contact (pri-
mary or secondary) and degree of formality. An athletic club may have a num-
ber of formal rules, which its members have to follow. But an informal friends
group does not have any formal rules. Homophily is another criterion that
may be important, especially for products in the categories of apparel, per-
fumes, cigarettes and watches etc. Homophily refers to the degree of similarity
among group members. Consumers with similar interests are likely to meet
frequently and exchange information on a variety of aspects associated with
buying behaviour. In this case, word of mouth becomes a strong influence.
Density refers to the extent to which group members know each other. Even
household neighbourhoods may differ in terms of density associated with
groups. Families that follow a Western lifestyle as against an ethnic lifestyle,
are likely to reflect a lower degree of density. The degree of identification,
though not associated with groups, may be important because this deals with
how much a consumer identifies with a specific group. A consumer may be a
part of a software group but may like to dress more formally. Individual iden-
tification with the group has an impact on conformity or the extent to which
an individual behaves according to the wishes of the group.
Another characteristic of a group may be tie strength. Strong ties may indi-
cate a close, intimate relationship and weaker ties may reflect a distant, limited
inter-personal contact. MCI, a telecom company in the US, introduced “Friends
and Family” program offering discounts to consumers who were able to iden-
tify about 20 people who they call frequently (strong ties). Weak ties are also
useful because they can act as gate-keepers to transfer information to various
groups. A consumer can learn about a brand from a weak tie and transfer the
information to a group with which he/she has strong ties. Sometimes, weak
ties may also result in “embedded markets” because they can influence how
a consumer reacts to them. For example, a consumer may prefer to buy an
Amway cosmetic or a Tupperware container from an agent who is his/her
neighbour rather than from an unknown agent, though the “relationship tie”
may be weak between the consumer and the neighbour.
9  The Concept of Reference Groups and Their Implications on Branding 241
Reference Groups as a Powerful Source

of Influence
Consumers try to use sources that are not dominated by marketers, like “word
of mouth” (WOM) from friends and families, WOM from clubs, Internet fo-
rums and neighborhoods. In fact, online social networking sites like Facebook
or Orkut have added another dimension to WOM (apart from the contribution
of review websites like mouthshut.com). Such reference groups are extremely
important to marketers for receiving feedback about the product and for moni-
toring the discussion among its members. If there exists a negative opinion for
the brand, marketers need to probe further and take appropriate action using
cyber opinion leaders who may have a positive word of mouth about the of-
fering/brand. While such channels are not entirely dominated by marketers,
it is essential for marketers to research and find opinion leaders who would
interface with other prospective consumers online. Profiling online consumers
with regard to psychographics, interests and possessions will enable market-
ers to identify specific target segments for which messages can be tailored with
the help of opinion leaders. For example, there may be a target segment inter-
ested in state-of-the-art features of a mobile, or another segment interested in
the “coolness” of the latest launch of an i-pod. One can imagine the use of such
online interfaces to spread WOM for a brand like Nokia that has about one
billion consumers around the world. Beyond the marketer- or non-marketer-
dominated communication, the challenges for marketers today is to synergize
communication emerging from the online and of-line interfaces of reference
groups. For example, a celebrity can endorse a brand in an advertisement and
generate a positive WOM that can be continued online among a group.
It may be worthwhile for marketers to identify opinion leaders and market
mavens through marketing research. Opinion leaders can also be used in ad-
vertising. Celebrities, models and representatives from various social groups
can be used in advertising as opinion leaders. However, there may be subtle
differences in the usage of such opinion leaders depending on the objective
of the communication. Lalitaji of Surf is an opinion leader (“common man”
appeal). Bournvita, Horlicks and Complan also use the mother-child model as
an opinion leader in their advertisements. The grandma of Himalaya (Ayur-
vedic concept) is a “spokesperson” for the brand as she has endorsed all the
offerings the brand introduced from time to time. Kapil Dev and Tendulkar
played the role of the “expert” when they advertised for Boost (“secret of my
energy”). An “expert” is an opinion leader who can endorse a brand based
on his/her knowledge and training in a specific field. As a sportsman, then,
Kapil Dev has to have the knowledge and training to spot out a drink which
gives energy. A celebrity can endorse a brand simply by reflecting his/her
satisfaction with it (more by usage rather than expertise). Celebrities used in
Pepsi, passenger cars and BPL advertisements fall under the “endorsement”
type of celebrity appeal. Surf Excel detergent used the “Olive of life” appeal
in its reference group-based advertisements. It showed how a consumer can
solve the problem (stain removal in this case) and the target segment is likely
to associate itself with its model.
Normative Influence: This is social pressure designed to encourage con-

formity. Part of the normative influence is acquired by the consumer during
socialisation and interaction with the family. The consumer develops certain be-
haviour about the types of product categories and brands to be bought, places
to purchase them from and methods of using them. Normative influence affects
brand choice congruence. Consumers are very likely to buy what others in their
group buy (generally, in certain product categories like clothes, foods and cars).
Product characteristics affect normative influence depending on whether
the product is consumed in private or in public. Water-heaters and antiseptic
lotions may be private products, and cars and two-wheelers public products.
Products can also be classified as necessities and luxuries. Research studies
have established that reference groups influence product category purchase
or brand choice or both depending on the types of products and how they are
perceived in a given product/market situation. For example, choosing a brand
of two-wheelers may be more associated with reference group influence than a
brand of kitchen mixer. Luxury products, especially if they are public products
like hand-held camcorders or high-end cameras, may be subjected to reference
group influences.
Consumer characteristics also affect normative influence. Certain consum-
ers are susceptible to interpersonal influences and may have a need to en-
hance their self-image by acquiring products or brands that they think will be
approved by the reference group, of which they are a part. They may exhibit
conformity to enhance their self-image. A personality trait called “attention to
social comparison information” is related to normative influence.
Hoyer and MacInnis state that there can be predictions about when refer-
ence groups will influence decisions with the framework shown in Figure 9.1.
Product
Private Public
Necessity Mattress Watches Low

Shoes Product
Preference
Luxury CD Player Jewellery High
Low High
Figure 9.1  Brand Preference

Note: Marketing research is required before any categorization is done using this
framework.
The framework reflects the degree of reference group influence on brand

choice depending on the nature of the product:
Informational Influence Informational influence is the extent to which

sources offer information to help consumers make decisions. This influence is
important because reference groups provide information to reduce consum-
ers' information search. Informational influence can be triggered by specific
advertisements that create awareness on products/brands/features. Infor-
mational influence may affect purchase decisions when offerings are com-
plex and the perceived risk is high. This is also likely to work when perceived
brand differentiation is high among durable products. Consumers, who are
oriented towards informational influence, will seek product-relevant infor-
mation. As for consumer characteristics, informational influence is likely to
be greater if the source of information is regarded as an expert. (For example,
an ace racing champion communicating the benefits of a car's features will
carry credibility with consumers planning to buy a car.) Informational in-
fluence may also benefit FMCG products. An event associated with coffee
sponsored by a company like Hindustan Lever or Nescafe can trigger off
product-related exchange of information on coffee. Such events can provide
the content for informational exchange to take place. The “common man” ap-
peal may have informational and normative influence on the target segment
because of source similarity, since the latter perceives the source to be similar
to itself.
Word of Mouth and Reference Groups

Word of mouth (WOM) refers to information about products or services com-
municated verbally. WOM can be persuasive because of the credibility asso-
ciated with it (in the “marketer-dominated” media) and also the face-to-face
association involved in the communication process. The credibility is higher
because the consumer usually chooses his/her sources for WOM. Research
shows that WOM can be seven times more effective than the print media,
twice as effective as the broadcast media and four times more effective than
sales personnel. WOM can have a dramatic impact (positive or negative) on
the perception of consumers. WOM referrals can be very effective in consumer
durables where there are a number of well-known brands but the consumer
fears a risk against the product category because of the high unit cost. Even in
the case of FMCG products, WOM can be effective. McDonald's entry in the
West Asian market was triggered by WOM. Medical, entertainment, financial
and beauty-care services can also benefit from WOM as a number of intan-
gibles are involved in these services. Body Shop, which manufactures envi-
ronment-friendly cosmetics, has created awareness all over the world through
WOM. Marketers have to promote favourable WOM and prevent negative
WOM. BMW, the reputed brand of premium cars, is known to sell cars at re-
duced prices to diplomats to trigger WOM about the brand. Viral Marketing
is a variant of WOM. Hotmail is probably an interesting example of how viral
Box 9.1
The “Relate” Connection
The reference group aspect is highlighted by Bernd Schmitt as the “Re-
late connection”. It is the connection with people, other social groups or
a culture. “Relate” marketing may result in experiences that will have
a positive impact on the brand. Harley Davidson, the famous brand of
American bike, stands for adventure, a free spirit and outdoors. The brand
draws several motorbike enthusiasts to weekend rallies staged around the
country. The sense of belongingness, which the brand evokes, is so strong
that owners of the brand tattoo themselves with its logo. This has cre-
ated a well-knit brand community. So, not only does the brand – Harley
Davidson in this case – become the owner's identity, but the owner also
feels a sense of pride in belonging to the elite group of Harley Davidson
owners. The stength of emotional bonding that takes place in a club with
a fan following for a brand like Harley Davidson can create intrinsic grat-
ification of associations among its members. This leads to passionate re-
lationship and can be a powerful influence in making the brand a cult
brand. The ultimate advantage of a cult brand is that the word of mouth
generated is spontaneous and it diffuses faster among those who aspire
to join the club. The other advantage is that such members are likely to be
hardcore loyalists of the brand. This ensures that they upgrade or repeat
buy (with commitment) the same brand, being immune to new offerings
in the market (even when they want to replace the offering). The marketer
of such a brand needs to ensure that the brand (in terms of appeal, both
functional and symbolic) connects with the loyalists over a period of time.
marketing can work. With millions of users opening their accounts, Hotmail
became an important advertising site.
There are several strategies to deal with rumours when they carry a nega-
tive WOM. One of them is not to do anything. The consumers may actually
hear about the rumour when marketers of a brand attempt to correct it. A
study found that 35 percent of consumers learnt about McDonald's “worm”
rumour through the brand's anti-rumour campaign. A second option is to
quash the rumour by responding only to those consumers who enquire
about it. Procter and Gamble sent information only to those consumers who
enquired about the controversy surrounding their logo, which the company
had introduced (which had man-in-the-moon perceived to be associated
with devil worship).
Another option is to deal discretely with rumours. When the public in the
US perceived oil companies to be greedy, the companies launched campaigns
highlighting the socially desirable things they had accomplished. Another

option is to use creative advertising to refute the rumour. GM launched an
advertising campaign designed to put down the rumour that it was going out
of business. It advertised that its brand “Oldsmobile sells more vehicles in
America than Mercedes-Benz, Infiniti, Acura, BMW Volvo and Lexus com-
bined”. Online communities can also be used to refute rumours or bad word of
mouth. A brand can gain from building an online community that will be useful
both in spreading positive WOM and controlling a negative WOM, especially
when there may be several anti-brand sites. Wal-Mart and P&G are attempting
to come to grips with such sites. The movie, “The Witchblair Project” became
a runaway success after it constructed an interactive site (blairwitch.com), in-
volving browsers in the story. The advertising expenses for this movie were
insignificant compared to the $200 million for the movie “Godzilla” (which
resulted in a revenue of just $138 million in the US market). J. K. Rowling
(creator of Harry Potter) sold more than five million copies of books more
because of WOM than due to any creative advertising. There are companies in
developed markets that attempt to quantify the impact of positive or negative
WOM on brands, through research studies tracking WOM.
Celebrity Usage and Their Impact

Celebrity usage is one of the topical strategies of many brands across cat-
egories. Some brands use them for getting attention (Santro), some for pro-
longed association (Lux) and some, perhaps, for the purpose of recall (Cema
bulbs). As in other facets of marketing, it may be worthwhile to analyze the
usage of celebrity with related aspects of the marketing mix, rather than taking
a rigid position on the usage or non-usage of celebrities. What is required is a
framework that can offer a marketer specific options and follow up aspects of
using celebrities.
Mechanism of Celebrity Usage in Advertisements

It is necessary to understand the psychological aspects of celebrity usage in
advertisements regardless of whether a celebrity is drawn from films, sports,
beauty contests or politics. A celebrity has the glamour and/or charisma to
trigger and sustain a following by using the emotional power of “identifica-
tion”. Identification, in this context, is the feeling of bonding which the fol-
lowers, consumers in this context, exhibit towards a celebrity because of the
admiration and adoration that may transcend rational motives. This concept
is in line with the reference group concept, in which the followers attempt to
have a role model whose attitudes and values they like to imitate. This is an im-
portant tool that can influence consumer behaviour. The impact of this kind of
influence can be illustrated by the example of Vespa scooter. The Italian brand
has become fashionable again in some parts of the US because celebrities like
Steven Spielberg own the brand. Though these celebrities may not have been
the typical segment the company would have planned to target, the celebrity
association may have created consumers, who may not otherwise have been
interested in two-wheelers. The “identification” mechanism is a psychological
outlet for consumers and gives a vent to their unfulfilled aspirations and de-
sires. These may deal with materialistic possessions or merely fantasies.
Factors to be Considered in Celebrity Usage

There are a few basic factors to be considered before a brand chooses a celeb-
rity/celebrities (see Figure 9.2). Each of these factors has a major influence on
the effectiveness of the celebrity association.
Importance of the Target Segment The target segment is one of

the basic considerations that a brand should take into account. It is common
knowledge that regional film celebrities are often used for brands that are
marketed in a specific region (textiles, fast food, coffee, beedis). For a brand
that wants to avoid spending money on a high-visibility campaign, a film
star popular in a given geographic region will be effective to influence con-
sumers in that specific region. The advertising execution (visuals, jingle, etc.)
will have to take into consideration local preferences, culture and language
so that “identification” occurs spontaneously. There is a need to clearly cat-
egorize the celebrity based on the appeal. There are film celebrities who have
a rather wide appeal. These celebrities may figure across product categories.
Amitabh Bachchan, Sachin Tendulkar and Shah Rukh Khan belong to this
Unfulfilled
desires Celebrity *
aspirations association
fantasies
Imitation of
celebrity
on several
counts
Choosing the
brand associated
with the
celebrity
Figure 9.2  Process of Identification

*Choice of the celebrity will depend on the target segment of the brand
category. However, a brand has to be careful that excessive exposure does

not cause celebrity wear out. The celebrity may make an impact but not the
brand. A brand of jeans, which was targeted at the youth, used a middle-
aged western celebrity who may have appealed to youngsters a few decades
back but not any more.
Kohinoor, the brand of premium rice, used Tiger Pataudi and Sharmila
Tagore; Pepsi has used several spirited cricketers; Vimal and Digjam, brands
in premium men's wear, used celebrities from films but not necessarily those
who play the hero. These are examples of positive celebrity associations, in
tune with the identification needs of their respective brands.
Celebrity Clutter in the Category There is a need for marketers to re-

view the product category for analyzing the number and nature of celebrities
to be used in the category. In the category of pre-recorded cassettes, no brand
has used a celebrity to impress upon the quality of the music, though several
brands are attempting to differentiate themselves using variety. As variety be-
comes a non-differentiator in present day competition, a classical or playback
singer can lend credibility to the brand of pre-recorded cassettes. Cola is a
category, which is experiencing celebrity clutter. Hence, any brand in this cat-
egory has to opt for a non-celebrity to build the brand. The “cola celebrity” as-
sociation is very strong, given the consumption of cola in the soft drink market
and the advertising exposure created by cola brands. This may have a strong
impact on the category itself and any other brand attempting a celebrity route
may be eclipsed by the existing clutter.
Is Celebrity a Long-term Brand Property? Brands may consider ce-

lebrities as long-term brand property and hence, may have to carefully choose
them. Lux has been using celebrities for several decades. These celebrities,
almost always contemporary, have been drawn from films. The usage of ce-
lebrity as brand property goes well with the brand proposition of Lux—clear
and attractive complexion symbolised by celebrities for whom this character-
istic is a prerequisite. Pepsi can follow the same strategy by associating the
brand with popular cricketers over a period of years, especially in a situation
where its arch rival, Coke, cannot use celebrities from cricket. This will give
the brand a sustainable advantage over the other brands in terms of “identi-
fication”. This approach can be extremely useful in product categories, which
revolve around imagery rather than functional benefits. It is difficult to list out
the functional benefits of an aerated soft drink when several other alternatives
are available to consumers to quench their thirst. This is also a category where
a number of brands are attempting to create an imagery that will appeal to
the target segment (youth). In fact, there is a distinct possibility of using an
appropriate celebrity who will appeal to at least a small section of the adult
population that consumes aerated soft drinks. Niche brands which offer bitter
lime, ginger ale and the like can attempt such a strategy after researching the
profile of the target segment.
Celebrities and Attention-getting Aspects In an era of brand prolif-

eration, there may be a need to use celebrities, simply to hold the attention of
the target segment. There is a need to differentiate between FMCG products
and durables before such a strategy is applied. The basic assumption here is
that the celebrity may or may not have the credibility to further the propos-
ition. For example, Crowning Glory, a brand of soap, used Dimple Kapadia,
who added credibility to the brand proposition of hair-care with her own love-
ly, lustrous hair. In contrast, a brand of bulbs used a celebrity simply to get the
attention of consumers and move it up the “recall hierarchy”.
When an FMCG product uses a celebrity just to capture attention (and not
as a long-term brand property), there is a need to ensure that the brand is
available at retail outlets in the territory of advertising. In order to make the
strategy more effective, point-of-purchase (POP) posters and merchandising
displays can be used together with the celebrity-based advertisement. This
will enable the recall process to be triggered, apart from creating a top-of-the-
mind awareness for the brand. Such integrated approach to celebrity adver-
tising for an FMCG product is likely to have a high impact on the consumer
intention to buy. In fact wherever it is appropriate, sales promotion involving
the celebrity may additionally impact consumer psyche.
In the case of durables (BPL, Santro, Samsung), the product offering has
to be in tune with the expectations of consumers. It is to be noted that ce-
lebrities used in this context may highlight the features or the end benefits
but they do not have the expertise (in most cases) to add credibility to the
brand proposition. Hence, consumers may be taken in by the appeal of the
celebrities and the brands may slip into the “consideration set” of prospective
consumers. This is useful especially for new-to-the-market brands like Santro
and Samsung, which may not have much brand equity at the time of entering
the market. The strategy has to be followed up with a good customer-interface
at the retail outlets. Specific benefits that may motivate the consumer may
have to be highlighted by retail personnel, or there may have to be a follow-up
campaign that highlights the benefits of the brand over those of competition.
Santro used this approach (in a comparative advertisement) in a follow-up to
its celebrity-based launch campaign. Word of mouth is extremely important in
durables. So is the excellent service, which may be required to fortify the initial
interest triggered by the celebrity appeal.
In certain situations, brands may have to even hold a product-line that
may be of interest to consumers to back up a celebrity advertisement. Philips
TV (initially launched as PHX in India) used a well-known celebrity but did
not have a product-line comparable with the competing brands at the time.
It is essential that the interest triggered by the celebrity (in durables) results
in purchase of the brand at retail outlets. This is possible only if the brand
has a strong marketing mix package. Certain premium brands, known for
several decades around the world, can benefit from using several celebrities,
even during a short span of time. These brands are so well-known that they
have, by themselves, become a global lifestyle statement (see Table 9.1). Hence,
the association with celebrities is just a strategy to get attention and project a
Table 9.1  Dimensions of Celebrity Usage
Need Brand Celebrity Benefits Usage

* Brand awareness Santro (cars) * Created awareness in a market in
which the brand was unknown
* Top-of-the-mind recall Cema (bulbs) * Improved brand recall in a low-
involvement category
* FMCG—lifestyle Pepsi (cola) * Attracted youth population orientation
* Product-benefit Lux (soaps) * Cine stars endorse brand
Boost (drink) benefits
* Relaunch Colgate Total * Conveyed the benefit (12 hour
(toothpastes) protection) through the celebrity
* Established brand BPL (durables) * Celebrity enhanced the credibility
appealing to the of the brand
rural segment
* Preserving a habit Parker (pens) * Celebrity endorsed a global brand
against changing and also retriggered the interest in
trends using the basic pen in a digital era
* Reinforcing brand Rajdoot * The rugged celebrity association
personality (early eighties) reinforced the brand personality
contemporary image. The brand image, cultivated over time, would be power-
ful enough to suppress any discrepancy that might have been created by the
association of celebrities, who may otherwise project divergent associations.
Omega is one such brand.
These aspects cover only the usage of celebrities, and not the other di-
mensions of reference group concepts that may also be equally useful to the
marketer. A celebrity can add to the other elements of the brand, if used in a
conceptual manner (see Figure 9.3).
Box 9.2
The Hyde Effect
Mohammad Azharuddin and Hansie Cronje are celebrities who typify
the emergence of the Hyde effect in the Indian context (there have been
quite a few in the West). Pepsi and Hamstead (a brand of suiting) used
these celebrities to the hilt before they were dropped following match-
fixing scandals.
The Hyde effect can be avoided by not banking upon a specific ce-
lebrity for obtaining the “identification”. Pepsi has cleverly avoided the
effect by banking on cricket for “identification” and not on the character-
istics of a specific celebrity.
Objective
(need-based)
Target Celebrity Benefits

segment association of using the
(psychographics) celebrity
Long-term impact
on brand associations −
Will it affect the brand
personality?
Fig. 9.3  Selecting a Celebrity
Box 9.3
Can Celebrities Work When Brands
Are Not Created?
One of the interesting aspects of celebrity usage is the question of their
impact on the target segment when the latter is not clear about what
the brand stands for. A string of popular celebrities like Hrithik Roshan,
Shah Rukh Khan and Priyanka Chopra appeared for the advertisements
of the brand Home Trade. A brand is built through associations. These
may either be benefits or an emotional appeal depending on the prod-
uct category. Home Trade used celebrity advertising, and it is not cer-
tain if the target segment was clear about what the brand stood for.
It was, in fact, a financial super market retailing options for consum-
ers through the Internet. Home Trade implied that the consumer can
effectively make financial investments from the comfort of his/her
home. A strong focus on the benefits of such an outfit or an unambigu-
ous endorsement of the services (by the celebrity) may have been very
effective.
Source: February 28, The Hindu Businessline, 2002.
Touch of Reality
WOM and Perceived Risks

WOM and perceived risks open up a few thoughts for marketers There
are four quadrants shown in the diagram (see Figure 9.4). Low risks and
high degree of WOM may be associated with fashion and fun products
that may range from chewing gums to symbolic mobile phones and
iPhones (“Fun and Frolic”). The risks involved are considerably lowered
by the branded offerings (well-known ones) and the buzz factor enhances
the symbolic appeal of the offerings. Low risks and low WOM is applic-
able to everyday FMCG that are utility oriented. But even in this con-
text, there may be brands like Colgate Maxfresh that may trigger WOM
through celebrity usage or a creative advertisement (a lady police officer
seduced by a young man when he is asked to take the breath test to check
for alcohol, as driver of a car). Several FMCG categories may fall under
this “Mundane” category. High degree of perceived risk and low WOM
is associated with high involvement categories that are not amenable to
WOM (“State of the Art”). Advances in specific areas of medical care (ar-
tificial saliva recommended by dentists for some patients) is an example.
Finally “Deep Decisions” are those that are more oriented towards utility
value of categories and brands. For example, a consumer who is inter-
ested in buying a washing machine or an electric cooker may rely on
WOM to ascertain to what extent a brand provides value. This is different
from “Fun and Frolic” where WOM is more about the symbolic value/
acceptance in a specific group.
High
State of the Art Deep Decisions
Low High
(WOM)
Mundane Fun and Frolic
Low
(Risk)
Fig. 9.4  Degree of WOM involved

The Triad Route to Celebrities and Brand

Associations
The triad theory suggests that a consumer will ensure that he/she has
an attitude that is in consonance with the brand if he/she likes the celeb-
rity. For example, consumers who may like Amitabh may have bought
the BPL brand simply because he has endorsed the brand. A non-profit
organization like PETA (People for Ethical treatment of Animals) may
have a celebrity like Paul McCartney (one of the members of Beatles, the
“Rock and Roll” group that became a legend) to advocate vegetarianism.
The theory works on the basis that consumers who like the celebrity will
also associate themselves with the brand/cause advocated by the celeb-
rity. The basic point is that a consumer would want to create equilibrium
in himself/herself by adopting these synergies among these associations.
A camera brand Rebel used Andre Aggasi, the tennis player known for
his temperamental behaviour on the tennis field—adding one more di-
mension of synergy between the traits of the celebrity and the name of
the brand.
10
Dimensions of Culture
and Branding
Culture is one of the major factors affecting consumer behaviour. The atti-
tudes and values of consumers are culture-specific in a broad sense. Cul-
ture is a combination of learned beliefs, values and customs that directs
consumer behaviour in a specific society. Beliefs, values and customs are
important components of culture. Customs are overt modes of behaviour
that are acceptable in a specific cultural context. The different food habits
of Indians, for example, are customs that are part of a region-specific cul-
ture. From the marketing viewpoint, products and brand communication
have to take into consideration the customs existing in a specific market
situation. A marketer offering an alternative for the morning cup of cof-
fee or tea (to which a large chunk of consumers have been used to for a
long time), will find it extremely difficult to change the custom. But with
changes in environment, customs also change and marketers can be suc-
cessful if they time their products/brands and position them in an appro-
priate manner. A few decades ago, using nail enamel and lipstick was a
taboo among many consumers, especially in villages. While nobody looks
twice at someone who uses the products in urban areas, rural consumers
are now not averse to using them. A number of health clubs have mush-
roomed in urban areas because health and fitness are areas of interest to
several urban consumers due to their stressed lifestyles. Zaltman, the well
known researcher on the qualitative aspects of marketing, states that there
is a link between the mind, body and the social culture. A good example
of how this works, is the mental state (and the physical reaction as well) of
a consumer who is used to pure vegetarian food as a part of his/her cul-
ture, when he/she is suddenly exposed to Korean cuisine full of “exotic”
unusual non-vegetarian menu—“crawling” delicacies that are part of the
country's eating culture!
Characteristics of Culture
Culture is specific to a context. Different countries have different cultures and,
hence, consumer behaviour also differs in different countries. This aspect is
particularly important to multinational corporations that enter different mar-
kets to cater to the diverse cultural needs of consumers. The differences in
perception among consumers with regard to products (and, perhaps, even
brands) are based on need, usage and importance. In the US, products like
cola, burgers, peanuts, popcorn and ketchup are a popular part of the cul-
ture. Tea, sandwiches, bowler hats, golf and raincoats are an intrinsic part of
the English culture. Kimonos, rice, cars and cameras are synonymous with
Japan while one identifies beer, music and cars with Germany. Pasta, pizza,
espresso coffee, art, wine, opera and shoes are a part of the Italian culture and
perfume, wine, cognac, cheese and champagne are intrinsic to the French cul-
ture. Samosa (spicy eatable), tea, “beeda” (beetel leaves and nut), bicycles and
incense sticks generally represent the Indian culture, though there may be sub-
cultural differences.
Differences across cultures have a number of implications for the marketer.
McDonald, in India, does not use beef in some of the popular items on its
menu as cows are sacred to a large section of Indian consumers. Money-back
guarantees may reassure US consumers but not those in Latin America as they
never expect their money back. Pizza Hut offers sea food delicacies in Japan.
Procter & Gamble came up with different variations of its TV commercial for
its disposable diapers – Pampers – for different European countries.
Sub-cultures consist of ethnic groups within a culture. These groups have
common heritage, religion, beliefs, customs and experiences that differentiate
them from other sub-cultures within the culture. There may be certain aspects
that stand for the Indian culture, but almost every state in the country reflects
a sub-culture (Refer Plate 12). Dressing styles, eating habits, festivals and reli-
gious rites and rituals are different in different Indian states. With several pro-
fessional domains getting into the Indian context, sub-culture may also be
found within the professionals belonging to a specific domain. For example
executives in the advertising field or the software field may have certain
aspects of a culture that are widely adhered to within the respective group.
Culture and Consumer Perception

Figure 10.1 reflects how the perception of consumers is associated with cul-
ture, of which they are a part:
The cultural aspects include perceptions of consumers about work, leis-
ure, time, festive occasions, ethnicity and gender, which affect the meaning
associated with product categories. For example, there may be differing per-
ceptions on clothes to be worn for work and for informal occasions. Mean-
ings can be associated with product categories of liquor and cigarettes. These
meanings can vary from one market situation (country/region) to another.
Gender can also trigger perceptions. Women have all along, been considered
10  Dimensions of Culture and Branding 255
Cultural
aspects
Environment
Marketing Meaning of
communication products
Consumer
perception
Figure 10.1  Impact of Culture on Consumer Perception.
delicate, whimsical and expressive. Aggression is more a male aspect, trad-

itionally associated with men. Certain types of clothes are associated with
women (transfer of meaning to a product). Marketers have to be sensitive to
the “meanings” associated with the products in a specific market setting. They
have to clearly communicate their message in accordance with the percep-
tions associated with product categories, and also ensure that the respective
brand gets differentiated through positioning strategies. There is also a possi-
bility that over a period of time, the cultural meaning associated with a prod-
uct category may change. For example, (cigarette) smoking was considered a
“sinful” act in conservative South India a few decades back. It is an accepted
practice now, even in villages. Beauty parlours that were once taboo are now
frequented by a significant number of urbanites. The meaning of “cosmetic
product category” has changed in the Indian cultural context (at least in most
of the states). Consumers have moved from the plain talcum powder of the
yesteryear to several cosmetic product categories. Bicycles and two-wheelers
have given way to four-wheelers as status symbols. In certain categories, mar-
keters have used “tradition” to launch products. Nikhar Soap from Godrej
and Santoor from Wipro, make use of ingredients traditionally associated with
skin/complexion care. These brands have also differentiated themselves in the
crowded category of soaps using their “herbal” proposition.
Using herbal products is very much a part of the Indian culture and brands
like Lifebuoy and Hamam from Unilever, which have been a part of the cul-
ture for a long time have launched herbal variants. Cultural meanings also
change because of environmental changes. Westernization has impacted the
Indian marketing context with several product categories carrying Western
overtones. Anti-wrinkle creams, diet soft drinks, fast foods, and status-orienta-
tion in the category of automobiles and jeans are a few examples to reflect the
impact of Westernization in the Indian context. Even in this scenario, Arvind
brand positioned its Ruf&Tuf jean as the aspirational Indian jeans for the
Indian youth at an affordable price (when the brand was launched).
Culture and Emblems

A consumer communicates with others in the society (different types of groups
he/she is associated with) by conveying a message through the products he/
she uses (or is in possession). What the consumer is performing here is the
emblematic function in a culture. The music which one listens to may stand for
his/her age (ranging from Andy Williams, Beetles, Boney-M, Abba to Michael
Jackson, Spice Girls and Britney Spears) and the type of reference group he/
she belongs to. People observe others and make conscious or unconscious
inferences through the products/brands they use.
There are different kinds of “emblems”, which convey meanings about the
consumer.
1. Geographic emblems: Products may vary across regions and hence, have a
geographical identification. Traditional and ethnic dresses (for men and
women) vary across Indian states. However, executives working in the
corporate world, especially in urban cities, have a similar dress code to
symbolize their business orientation. Jeans/denims worn by youngsters,
especially in metros, symbolise their “Western orientation”. There may
be brands that have a global identification. Rolex, Omega and Mercedes
are brands that stand for class and status in virtually all parts of the
world. Marketers can use specific aspects of a culture to create brand
preferences. There may be new trends in a specific country/culture. For
example, Westernization is catching up in a number of developing coun-
tries. Certain brands that symbolize Western lifestyles and values (Coke
and Nike) are admired a great deal by emerging economies. Jeep Chero-
kee in Korea costs four times the price of a comparable offering from
Hyundai because the brand symbolizes the “adventure” associated with
Americans.
2. Ethnic emblems: Food, apparel and rituals are, probably, some facets
through which consumers express their ethnic identification. Kellogg's
cereals generated significant trials in India but the ethnic identification
of Indians with (traditional) food is so strong that the brand has a long
way to go in the Indian market. A number of tea brands attempted differ-
ent kinds of positioning strategies in different states; Taaza is offered in
different flavours. The success of Limca (especially during the eighties)
can be attributed to the popularity of lemon juice (cloudy version) across
the country. The Western concept of lemonade (clear lime in the aerated
soft drink category) has been around in the country for several decades
but has not been able to achieve significant success. Though cola is also
not of Indian origin, the diffusion of the drink as a symbol of modernism,
perhaps, has made it a drink for the masses in many countries that have
not been associated with several aspects of the Western culture.
3. Social class emblems: From foods and cosmetics to durable products
like automobiles and watches, consumers employ emblems to reflect
their social status and to infer the status of others. Fast foods and
trendy restaurants (normally located in trendy shopping locations) like

McDonald, Pizza Hut and coffee cafes are associated with the young and
the fashionable. A consumer driving a mid-segment car like Santro, Opel
or Honda City may be accorded a greater status as compared to the one
who owns a plain Maruti 800. Guavas and grapes are associated with the
middle class while apples and cashews with the upper social strata. There
could be certain pockets in the country where the identity of consumers
springs more from caste, religion and background rather than from sym-
bolic consumption (rural markets in certain states). But as liberalization
of markets and lifestyle changes impact a specific market, the use of sym-
bolic consumption as an indicator or social emblem will increase.
4. Gender emblems: Cigarettes, alcohol, jewellery and clothes are categories

that have a strong gender association. These emblems have an impact
on strategy formulation. Cigarettes have been associated with men for
decades. Even today, a woman smoker is difficult to be found in public
places (even in the more liberal Bangalore). Ms, a cigarette brand, was
launched in India during the eighties. The brand targeted the young,
modern, professional woman. The brand was careful not to position
itself on the “glamour” platform. Instead, the message was that women
achievers are on an even keel with their male counterparts. This appeal
was built up in the campaign in a subtle manner. In spite of its low key
launch, the brand was withdrawn and ever since, no cigarette brand tar-
geting women has been launched. Jewellery has been, all along, in the
woman's domain. There may be a niche male population interested in
the product category (in urban markets). A brand like Tanishq or Carbon
has to be very careful if it were to launch product items for men. A dif-
ferent brand name, perhaps, could be useful. Even in jewellery, Titan has
Tanishq brand more oriented towards the urban culture and a distinct
brand Gold Plus to appeal to the traditional culture associated with jew-
ellery, especially in the urban markets. Shaving, in India, is traditionally
associated with men and several cultural aspects have to be taken into
consideration when a brand launches shaving systems for women. Braun
(from Gillette group) launched its shaving systems for women. The tar-
get segment has to comprise women who are independent of the family
influences on their grooming habits. This is likely to lead the marketer
to a niche group of women with a very specific set of values, activities,
interests and opinions (AIO). Psychographics can be very useful in iden-
tifying the appropriate segment of women. Braun attempted a trial sales
promotion during a specific period of time. A brand like Braun may
target niche media vehicles like Femina, Filmfare and TV channels like
MTV and V to create awareness on the product category and brand. Sim-
ultaneous approaches of creating awareness through niche media, a good
direct marketing program and demonstration at retail outlets can sell the
concept to the target segment. The process of selling a new concept prod-
uct to a new class of consumers belonging to a group (niche) with a dif-
ferent set of attitudes and values as compared to the masses in a specific
market is given in Figure 10.2.
Identification of
target-segment
(psychographics)
Retail outlets Decision Niche media

awareness
making
Trial WOM New

consumers
Figure 10.2  Targeting a Sub-culture with Distinctive Psychographics.
5. Reference group emblems: Membership to a reference group can also be

indicated in a culture through reference group emblems. Punks are a
group of people who are non-conformists in many ways, and iden-
tify themselves with groups using products which symbolize “anti-
establishment”(non-conformist) tendencies, dramatic elements and have
a shock value (studs, flouroscent hair colours, “weird” ear-rings, faded
jeans, leather outfits and, perhaps, some other products that may not
be in common usage in a specific society). Most of these products stand
for hopelessness, cynicism and tendencies that are not in tune with the
environmental cultural practices and beliefs (rejection of normal prac-
tices and unwritten codes). Consumers who are health-oriented reflect
their choices with regard to clothes and footwear. These products may
have both functional and symbolic value and create a sense of identifi-
cation. The art of corporate dressing, propagated by several brands in
the Indian context essentially address the need for identification among
the target segment of corporate executives. There are several younger
consumers who use products, brands and styles based on the “celebrity
reference group” from which they may select their role model. These
celebrities can be drawn from cricket, films or and other fields depend-
ing on the type of target segment and product category. In fact, cola con-
sumption may have significantly increased since celebrities stepped in to
endorse the various brands in the category. The identification with celeb-
rities is so compelling that the target segment (youth) tries to toe the line
of its role models and, hence, uses brands that they endorse. Marketers
should consider the implications of emblematic functions on the minds
of consumers. One approach could be symbol development that involves
identifying cultural principles associated with a category, and associat-
ing the brand with elements that would reflect the identified cultural
aspects.
Tanishq gold jewelery has a number of ethnic designs that have been asso-
ciated with Indian art and culture for several generations. Jewellery, a personal
item for women, has cultural associations with festivals, rituals and practices
and weddings. Hence, a brand that incorporates traditional ethnic designs is
likely to go down well with consumers in general, though there is a small
niche, which may prefer Western designs.
Another approach is symbol communication. Selection of the setting, for-
mulating the appropriate imagery and presentation of the product are some
aspects concerned with symbol communication. A brand of pen (like Parker or
Mont Blanc) can be shown in association with a number of up-market prod-
ucts like wine in a vintage glass, a classic model of Mercedes or a Rolex. Such
an advertisement needs no words to convey the message of the brand. Its asso-
ciation with other symbolic products/ brands conveys the meaning. The ele-
ments portrayed in the visual reinforce the up-market image of the brand.
The third approach involves organizing and formulating other aspects of
the marketing mix to reinforce the symbolic image. An up-market pen brand
like Mont Blanc carries a premium price, it is distributed through exclusive
outlets or up-market malls and is created through a special raw material. Each
element of the marketing mix reinforces the other elements of the mix.
Importance of Role Acquisition

All consumers perform different roles at different points in time (role of a
child, student, father/mother, executive, sports person etc). Marketers should
be interested in these kinds of life stage changes or transition of consumers
from one role to the other. There are three phases in role transition. The first
one is separation from the old role—a business school graduate getting into
a corporate job, for example. The next phase is the transition from one role to
another. The change to a new identity is revealed by procurement of material
objects and possessions that reflect the new identity in a symbolic manner. In
the example given, the consumer concerned may like to give up a number of
possessions of his/her student life and want new products/brands (designer
wear, a two-wheeler, an up-market watch and a credit card, which probably is
positioned for aspirational executives. The final phase is incorporation, which
is concerned with taking on the new role/identity. This may involve acqui-
sition of more products/associations that reinforce the identity chosen. This
happens over a period of time—this consumer can obtain memberships of
prestigious clubs, acquire an up-market automobile brand and holiday at a
foreign resort.
Role Transition and the Importance of Rituals

Normally, consumers go through certain rituals and get associated with sym-
bols when they assume new roles. They experience discomfort and uncer-
tainty when they begin to take on a new role. This may be because they are
not experienced enough to fulfill the expectations of the new role. Hence, they
may choose products that are associated with the new role. Consumers may
carry in their minds specific images of “roles” (doctor, engineer, executive or
lawyer), and choose products associated typically with them. As students,
young people may take on multiple roles—friend, sportsperson, student rep-
resentative etc., and choose brands associated with a particular role. Brands
“shape” the images that consumers carry about roles. “Just do it” from Nike
may appeal to youth who may assume the role of a friend (in a specific group)
or of a sportsperson. Consumers tend to use a mix or constellation of products
to identify themselves with a role.
Rituals are important in role transition as they involve others who may
enable the consumer to strengthen and reinforce his/her new role. A common
example is the transition of a consumer from being single to getting married.
Marriage involves a series of rituals and each of these rituals have a number
of products associated with it. The consumer uses these products to symbol-
ize his/her role transition with help from others in the ritual, as also their
“feedback” on both the ritual and the products. This “feedback” from others
is called reflexive evaluation and it helps him/her strengthen his/her identi-
fication with the new role. A bride being complimented for procuring good
jewelry or a groom drawing praise for the purchases he made for the occasion
are examples of reflexive evaluation.
Cultural transition occurs when consumers move from one culture to
another. An Indian who settles down in the US is likely to get used to colas
and pizzas replacing the food items he/she used in India. The same consumer,
however, may also continue to keep or use certain products that reflect his/
her parent culture—Indian jewellery, ethnic clothes, Indian music and video
cassettes of his/her favorite films.
Consumers in the transition phase represent a significant target market in
most situations. Creams and lotions in the “beauty market” essentially target
unmarried consumers (women) who are likely to go through a role transition
(by getting married). Second-hand markets are likely to boom when marketers
target products for consumers who are transitioning but are unable to afford
new versions of products/brands. Cars and scooters traded in the second-hand
markets are examples. Marketers create a perception that certain products are
essential for reinforcing the transition when consumers are going through
that phase. Titan's gift proposition as a gift item for the parent symbolizes the
growing status of the son/daughter and their gratitude towards the relation-
ship with parents. Wedding gifts are also oriented towards consumers who are
in the transition phase. Product constellations can also be emphasized by the
marketer. For example, a brand of modern retail outlet can position itself as a
retail outlet for groceries/vegetables/commodities for young couples who are
in the process of setting up home.
Indian Core Values

The Indian society is driven by a set of core values, though these may vary
in the urban context. These values remain basic to the Indian culture and are
strongly embedded in most sub-cultures. The variation in the urban milieu

may be attributed to changing lifestyles, impact of Westernization and diffu-
sion of technology. Even within the urban context, these values may have fur-
ther variations or contradictions. Young couples working with high-technology
firms may lead a typically Western lifestyle (cars, fast food and weekend hol-
idays) but still hold on to or practice certain religious beliefs and customs,
which are totally ethnic in nature. In general, Indian consumers are still culture
conscious in the sense that they conform to the cultural expectations of society.
Core values are those, (i) which are adopted by a significant number of people,
(ii) which are enduring and are followed by people for a long period of time,
and (iii) which enable marketers to understand the behaviour of consumers.
The following are some of the core values of Indians:
1. Family-orientation: Family, for an average Indian, not only includes his

own family only but also the extended family—parents, brothers and
sisters. That is the reality for a majority of Indians though the joint fam-
ily is fast diminishing in the urban context. The commitment of the male
consumer (in some cases, the female consumer too) to the family is such
that he, as the chief wage earner, supports the entire joint family. This has
several marketing implications. First, the disposable income of such a
consumer gets radically reduced and he/she is always looking for value-
based brands at a lower price point. This logic works equally for pur-
chases concerning self and the immediate family members. The brands
at the lower end of the market in a number of product categories like tea,
soap, toothpaste and shampoo typically cater to these kinds of consum-
ers. This type of consumer also mixes up brands and offerings from the
unorganized sector to balance his/her expenditure on such consumption
needs. In fact the low-end brands attempt to upgrade the consumer from
the offerings of the unorganized sector (unbranded and local offerings,
which may be marketed in an unstructured and haphazard manner). A
consumer may buy a branded detergent powder like Surf to wash his/
her “special” clothes and may buy low-end washing soaps (branded but
cheaper) for washing ordinary clothes (Refer Plate 13). He/she may buy
shampoo sachets (small packets, which are offered for around Rs 2 to
Rs 2.50—Chik shampoo was introduced at 50 paise) once in a while. Such
implications, in terms of “value” offerings, (Re 1 is less than 5 percent
of a US dollar) will not be felt in developed countries. As the consumer
feels the need to economize, he/she may also down-trade—or buy less
expensive brands after using higher-priced ones. Down-trading occurs
as the consumer's response to price increases across product categories;
and also when the cost of essential services like electricity, water or cook-
ing fuel goes up. This behaviour of consumers is important for marketers
as there have been constant efforts by companies to upgrade consumers
in several categories. For example, Hindustan Unilever Limited has a
number of price points in almost all its product-lines. Colgate also has a
number of price points—Colgate Herbal, Colgate, Colgate Gel and
Colgate Total brands. Consumers may down-trade at any price point

in the product-line and not necessarily at the lower end of the market
(though brands towards the upper end may experience a degree of price
insensitivity). Hindustan Lever introduced Surf Excel Power detergent
priced between Surf and Surf Excel brand in an attempt to move consum-
ers of Surf to Surf Excel Power (middle end of the market) some years
back, but the brand is no longer in the market. The company also intro-
duced a toothpaste brand Aim, with penetrative pricing at the lower end
of the market. These examples reflect that price sensitivity is a part of the
Indian culture. Britannia, the brand of biscuits, (the brand was built over
a period of several decades) has a product-line, ranging from the low-end
to premium offerings for a niche market. It introduced Tiger brand of
glucose biscuits (a major part of the biscuit market is in the unorganized
sector and glucose biscuits are extremely popular at the lower end of the
market) at the low-end, and it was a major success. This shows that con-
sumers at the low-end who are conscious of “value”, differentiate across
product categories even when they are under pressure to bring down
their regular consumption expenses.
2. Savings: Savings is an inherent value of Indians, given the uncertainty
in income generation (a majority of the population depends on agricul-
ture and only 24 percent lives in urban areas; monthly salary, as a regular
source of income, is available only to a small cross section of the popu-
lation). Unlike in the developed countries, community medical services
and assured pension after retirement are not available to most consum-
ers. Consumers fall back on their savings to celebrate festivities, specif-
ically weddings in the family, and spend as lavishly as possible. In the
recent times, consumers have begun spending on durable products after
the basic needs have been taken care of. Bicycles, watches and TVs are
perhaps popular “entry-level” purchases for the average Indian who is
able to take care of the basic necessities. Savings, as a habit, pervades all
sections of the society. Consumers belonging to all socio-economic classes
are interested in jewellery and for most of them it may mean investing
a considerable amount of their savings. Traditionally, jewellery is more
associated with women. Families with girl children are more likely to
spend their savings on jewellery. Mostly, consumers buy their jewellery
from their family jewellers who have been associated with their client-
families for several generations. Branded jewellery like Tanishq and Car-
bon cater to just about 2 percent of the jewellery market and target an
up-market niche. The popularity of installment payments for a number
of products ranging from bicycles to computers can be attributed to con-
sumers splitting savings between traditional purchases like jewellery and
appliances required for a convenient living.
3. Festivities: Celebrating festivals is very much a part of India's culture in all
the states. The sub-culture within a state (territory) determines the type of
festival that is to be actively celebrated. For example, Pongal is not quite
popular except in Tamil Nadu. Like most festivals in this country, Pongal
has a special association with the farmers of the state. Durga Puja, in West
Bengal, is celebrated with a great deal of enthusiasm every year. But it is
not popular in any other states even though its variations are celebrated
in other parts. Similarly, Onam in Kerala is another example of a regional
festival. Such festivals are a huge opportunity for marketers. Given that
76 percent of the Indians live in rural areas, a number of companies step
up their advertising campaigns and logistics during the festive months.
Asian Paints, a leading paints brand, associated its brands with festivi-
ties in Bengal and found that there was a substantial increase in its sales.
Several brands in a number of product categories offer sales promotional
programs during festive seasons and lakhs of consumers make use of the
“value-based” deals during these times. A number of consumers postpone
their purchases, especially durables, in the hope of getting such deals.
Even a niche jewellery brand like Tanishq came out with “Oraaphis” (fra-
ternal friendship bonds tied by girls to boys of their choice, usually in the
neighborhood) in gold on Raksha Bandhan. Gold coins with images of
gods (a sign of financial prosperity) are given away as gifts by marketers
of durable brands, normally through specified outlets in a city.
Shopping as a ritual: Shopping is a ritual of sorts, among both urban

and rural Indians. The type of buyers, the shops they buy from and the prod-
uct they purchase vary across geographical territories and the economic spec-
trum of consumers. Retail outlets may range from a roadside shop selling
vegetables to Big Bazaar or Croma or Shopper's Stop that promises a consider-
able degree of ambience, variety and service over other conventional outlets.
The fact that only less than two percent of the products (in value terms) are
retailed through departmental stores is a reflection of the fragmented nature
of retailing in India, quite the reverse of what happens in developed coun-
tries. Housewives shop almost regularly for basic commodities and vegetables
even though the trend may be changing in the urban context. Bargaining, es-
pecially in the case of commodities and vegetables, is an unwritten rule in the
transaction process. The popular departmental stores cater to the middle class
and has a sales promotion strategy for all the year across several product cat-
egories. In the case of durable products like TV, refrigerators or two-wheelers,
the average Indian consumer is oriented towards “extended problem-solving”
kind of decision making. As part of the great shopping ritual, members of
a family go visiting different outlets with the objective of comparing prices
and arriving at the best deal in a product category. The shopping of durables
by typical Indian consumers can be associated with compensatory style of
decision making, with buyers analyzing one brand after another (especially
when sales promotions are advertised) It is extremely difficult to find retailers
(durable categories) who refuse to sell the brand below the marked retail price
in order to clinch the deal with the consumer. This has been true of FMCG
products in the recent times and such shops use the signboard, “Buy and
Save”, to achieve big volumes.
The rural Indian scenario (a rural area is defined as a geographical region,

which has a population of around 5000 people and where 75 percent of the
male population is engaged in agriculture) presents a unique characteris-
tic, which marketers have used. In a number of villages and towns (around
6,25,000 villages) shandies are held every week and people buy the basic
necessities (some times even durables like bicycles and watches) from these
temporary markets. These are generally held on a specific day in a week and
retailers spread their “product-mix” in make-shift stalls. Most of them stock
fast-moving units across product categories that they buy from wholesalers
near their place of trade. A number of companies make use of video-vans that
arrange some kind of entertainment (most commonly, a movie) and end with a
brand message. Not every village or town, of course, has this make-shift mar-
ket, which attracts consumers from a number of neighboring villages. Most
consumers in semi-urban and rural areas visit the closest market in the town/
city for their purchases. Given the nature of durables (upper-end ones like
refrigerators and colour television sets), these brands are not in a position to
have a network of outlets reaching out to most parts of the country (like FMCG
companies that reach millions of outlets in rural areas). There are potential
markets in villages where higher-end durable categories may be consumed,
but the rural households in such categories, unlike their urban counterparts,
are spread out while the latter are concentrated in specific pockets. Some of
them, however, may be concentrated in a specific state (Punjab, for instance,
has a number of such households in rural areas). Marketers of durables can
adopt specialized channel strategies. A brand can identify such customers,
have a company-owned outlet (depending on its feasibility) and start a direct
marketing exercise to reach out to these households. Company-owned outlets
are preferred because the company establishes contact with these consumers
and can, at a later stage, attempt up-selling and cross-selling of its products.
LG, the brand that has a leading share in several categories of durable prod-
ucts, opened up sales offices in semi-urban markets in an effort to reach out to
consumers in the hinterland.
Mythology: Mythological stories, scriptures and music are an inherent part

of the Indian culture that has attracted scores of tourists from different parts
of the world. Apart from creating a brand experience in a service like tourism,
toys, souvenirs and artifacts can also be drawn from the Indian cultural mi-
lieu. Such offerings are marketed in places of tourist interest, but the offerings
are not branded. Most of these may not even have the right quality in terms
of product finish and durability. Tourism, largely promoted by Government
enterprises, has received considerable impetus in the form of infrastructure
and service support. But there is a vast potential for creating a brand in this in-
dustry—among both foreign and domestic travellers. A value-based branding
experience can create a huge market in tourism, which seems to have taken
off in a big way only in the upper social crust. Local toy manufacturers cater
to specific markets and a large chunk of the industry is in the unorganized
sector. Branded toys with Indian cultural themes (with several elements of the
marketing mix brought together) can open up attractive avenues for a brand.
Even multinational brands like Leo and Mattel can develop ethnic brands and
make it affordable for the masses considering the potential that exists in this
sector.
Food: As with most Asian countries, hot, spicy delicacies are popular in
India too. It may be worthwhile to note that food habits have a strong link
with culture and are difficult to change (Refer Plate 14). With the exception of
Maggi noodles during the eighties, there has not been a “foreign” food which
has become so popular. Bread, which has been around for several decades, is
still not popular barring certain urban and some semi-urban markets. But it is
interesting to note that several variants of wheat flour are popular throughout
India.
Changing Cultural Trends in Indian Urban Markets

The urban setting is very different from the rural or semi-urban market setting.
There are target segments in cities comprising professionally qualified, high-
salaried people who are into the fast track of life. The cultural values of this
segment reflect the trends in the urban markets (trends with regard to niche
consumers that does not cover the majority of the population). This niche is
strongly influenced by the lifestyle and aspirations of the West. The following
values can be associated with this niche:
Success through Professional Achievement: These aspects con-

tribute to the intrinsic and extrinsic motivational levels and are reflected in the
consumption of products and brands. Possessing a middle-end car (like Opel
or Honda City), membership of prestigious clubs and holidaying in a foreign
resort are some such products and services these consumers are interested in
procuring. These products/brands reinforce a feeling of accomplishment in
the individuals and are perceived as rewards. Ceilo positioned itself as a brand
for “those who have arrived” when it entered India. Though the brand is no
longer in the market, it is a typical example of how a brand positioned the car,
a status symbol, as an aspirational offering in an appropriate context.
Involvement in Work: As a logical extension of the previous value, con-

temporary consumers break away from traditional work practices and are in-
volved in high-tension, fast-paced jobs. They experience time pressure and
hence prefer time-compression or convenience products. A variety of retail
outlets across product categories have emerged in the context (ordering of
groceries online, direct marketing of brands, one-stop-shop stores, fast-food
restaurants like McDonald or Pizza Hut and grocery shops in petrol bunks are
some of the examples). There is a growing need for several kinds of services,
which may offer high levels of satisfaction. On-call services like plumbing,
bill-payment, laundry services and eateries are some of them.
Material success: Young professionals between 25 to 30 years, who are

extremely conscious of their materialistic success, have emerged in the last dec-
ade. This segment is significantly and markedly different from its equivalent
counterparts (in terms of education and status) two decades ago. The present-
day young adults have tremendous exposure to the environment through edu-
cation or work experience abroad. They belong to the cutting-edge professions
like software or are high-profile entrepreneurs. Higher education, intelligence
and aspirations of these consumers have resulted in their acquiring substantial
wealth at a relatively young age in the life-cycle stages. The wealth is spent on
essential products, which have contributed to the service economy—health,
amusement, time-compression and convenience. Besides, this segment choos-
es products and brands with a symbolic overtone; probably to tell the society
that they have “arrived”. There is great demand for quality-oriented, branded
services like laundry, in-home delivery of food, baby-sitters, pet-care and, in a
small way, online marketing of essentials.
Middle-of-the-road approach to tradition: The niche of consumers,

who are urban, highly educated and in the upper end of the socio-economic
strata adopt a middle-of-the-road approach towards rituals and other cultural
practices. Most are neither too permissive nor too traditional in their approach
towards tradition. This is similar to the niche of Indian consumers in the West
who adopt a similar approach.
Impulse gratification: While a number of consumers may be using

credit cards, the neo-urban young adults exhibit a compulsive need to buy
products and services through credit cards. This niche may possess multiple
credit cards. Some banks even attempt to get into the consideration set of such
consumers by offering discounts to students of premier institutions in the hope
that they may be prospective consumers interested in banking with them.
Use of hi-tech products: High-profile consumers use products like

mobiles, computers and other hi-tech products in the categories of house-
hold appliances and entertainment systems. This lifestyle aspect may be of
interest to marketers of high-end products like fuzzy-logic washing machines,
plasma television sets and, perhaps, products using blue-tooth technology. A
company with a rich database of consumers belonging to this segment can
have several variations of permission marketing (that essentially deals with
getting the consumer involved in the brand's messages that suit his/her in-
terests rather than bombard the consumer with a barrage of direct mailings).
This segment is oriented towards information, independent, involved in its
search and has the potential and willingness to spend. A number of brands
may address this segment through a media-mix. The penetration of PCs
would be high among the members of this segment as would be online in-
formation processing even though, eventually, these consumers may transact
at a retail outlet. Several brands are positioned to this segment with lifestyle
and symbolic appeals. Symbolic positioning can be backed up by a strong cog-

nitive (information-oriented) copy on the Internet. Interactivity can be put to
good use if the Web site can customize the informaiton provided to the con-
sumer. Queries are likely to be diverse in nature and TV commercials can be
supplemented by the Internet. There is also a possibility for the brand to de-
velop a brand community on the net. The urban niche is ideal for the market-
ers interested in one-to-one marketing or relationship marketing.
Symbolic Behaviour and Gifts

As gifting is a part of several cultures, it may be appropriate to consider the
process of gifting and its impact on the transfer of symbolic meaning. There are
two participants in the act of gifting—the giver and the recepiant. There may
be a number of occasions when gifts are exchanged. These occasions are deter-
mined by a specific cultural setting. Consumers in the US celebrate Mother's
Day, Father's Day and Valentine's Day. The Koreans celebrate the 100th day of
a baby's life. There are also occasions of making gifts, as in any birthday, wed-
ding etc. There may also be unstructured occasions, for example, an attempt at
reconciliation with regard to relationships or celebrating success.
Stages in making gifts

There are three stages in the process of making a gift—gestation, presentation
and reformulation.
The gestation stage is concerned with the motive(s) of making a gift. One may
have an agnostic motive, in which the giver or donor derives emotional pleasure
from the act of giving. The motive may be instrumental when the donor expects
something in return from the recipient. A consumer may have an obligatory
reason to make a gift because the relationship forces him/her to do so.
A consumer may also give a gift because of antagonistic reasons because
he/she is forced to give gifts to someone whom he/she does not like and may
select something he/she feels is not the best in his/her perception. The nature
of the gift is important at this stage. It may be inappropriate to give a close
friend a “token” gift because the relationship demands the gift be of higher
value. But token gifts may be appropriate when no gift is expected. Gifts may
also convey a specific meaning on certain occasions. De Beers, the global brand
in diamonds has positioned itself for the occasion of wedding. The value of
the gift (in terms of what it costs) may indicate the intensity of the relationship
between the donor and the recipient. Making gifts is also specific to a culture.
In Japan, it is odd to reciprocate with a gift which is of higher value than the
one received. Search time (the time taken by an individual to search for an
appropriate gift) also depends on the intensity of the donor-recipient relation-
ship. Another aspect of the gestation stage is taking a decision on when, in a
specific relationship, a gift should be made.
Implications in the Indian context: The gestation stage has several implica-
tions in the Indian context, which is influenced by changing lifestyles.
(1) It may be worthwhile for a brand like Titan or a brand of pens, which
is positioned as a gift, to conduct primary research on why the target
segment indulges in gift-giving, the kind of monetary value it places
on gifts and what kind of gifts are made for obligatory reasons. This
can help the brand to understand how the target segment perceives
the positioning of the gift. For example, if a brand is being bought for
obligatory reasons, the price may be more important than the emo-
tional aspect of the brand. Hence, there may be a need to launch a
variant of the brand. If the brand is bought for emotional reasons,
positioning can adopt innovative ways of heightening the emotional
proposition.
(2) Since India does not have too many consumers in the higher income
bracket, the role of a token gift can be researched in the process of
gifting—the type of token gifts perceived positively, their price
and occasions that are used for making such gifts. These aspects
can be studied in detail. A brand with a gift proposition can even use
the association to launch lesser-priced “gifts” across product
categories.
The presentation stage: This is the stage when actual presentation of the gift
takes place. The ritual or the ceremonial aspect of giving becomes important in
this stage. A gift wrapped nicely with a personal message in it tells the recipi-
ent it has been “selected” for him/her. The timing of the gift and the elem-
ent of surprise involved in it are also important. This stage also deals with
the reaction the donor expects from the recipient and his/her response there-
after. There may be an uncertainty associated with the impact of the gift on the
recipient—whether the latter will like the gift or not. The attention elicited in
the presentation stage may also be important. Wedding and birthday parties
are occasions that focus on the recipient's reaction to guests and what they
offer (though in certain cultures it is impolite to un-wrap a gift in front of the
donor).
Implications in the Indian context: In most Hindu weddings (across dif-
ferent states), the process of making a gift assumes significance and is
highlighted at the end of the wedding process. In certain sub-cultures
(especially in a number of semi-urban areas), money against gifts is perceived
to be more important. The intensity of the relationship is associated with the
amount of money presented, especially during the gift-giving ceremony. In
a number of cultures, gift-giving is built into the process of marriage when
it is finalized. It is an accepted convention that the families of the bride and
bridegroom exchange gifts. A substantial amount of money, shopping effort
and time are spent by both the parties for this ritual. Godrej Storewell is a
brand of steel cupboards that has built emotion into the brand by associating
it with the wedding occasion, while being presented as a worthy gift. The
brand associated itself as a gift item for weddings. The brand has maintained
its association with the occasion and the “bride” in its advertisements and TV
commercials.
The reformulation stage is the final stage of the gift-giving process. The donor
and the recipient re-evaluate their relationship based on this process. The reci-
procity on a subsequent occasion depends on the experience the donor and the
recipient had during the process of making and receiving the gift.
Given that hospitality and reciprocity are an integral part of the Indian cul-
ture, the reformulation stage holds the potential for brand positioning. While
some brands have positioned themselves on the “gifting” platform, there is
scope for a brand to position itself on the “reciprocity proposition”. Titan
brought in a warm feeling of reciprocity in one of its TV commercials showing
a daughter gifting a watch to the parent. Brands can identify the reformulation
stage across different occasions and build positioning strategies by using pri-
mary research. For example, how do students feel when they receive gifts from
parents and friends? How does a member of the family react to a gift from a
person who belongs to another family? How does a young executive react
when he receives a gift from a colleague?
Cultural aspects with a mix of varied factors can offer valuable insights for
a marketer in a specific environment.
Marketing Communication—The Ethnic Way

A number of positioning strategies in the urban context reflect the growing
influence of the West. But there have been successful communication cam-
paigns that conveyed the message effectively through the ethnic route.
There are many advantages of using the ethnic appeal (subject to the selec-
tion of target segments). Ethnic appeals are normally drawn from the culture
of a specific market, which reflects the practices, rituals, taboos and behav-
ioural orientation over generations. These may also be useful in enabling con-
sumers to connect with familiar situations. Ethnic advertising has the ability
to dramatize emotions in a specific cultural setting. Ethnic appeals can also
be combined with Western appeals. This can be best illustrated when com-
paring Titan's advertisement with that of Godrej's Storewell. The former has
an element of dramatization woven around the “warmth” expressed through
the gift (Refer Plate 15). The aspirational fantasy of gift-giving brought the
brand into the consideration set of consumers who shopped for gifts (not just
watches). Watch, as a gift, reflected in the picturization of the TV commercials
clearly reflects a Western orientation. The changing lifestyles, especially in
urban markets, are conducive to such a positioning strategy. In the case of
Godrej's Storewell, the “emotional” connection (though portrayed as a gift) is
achieved by the backdrop of a marriage in which the bride receives the cup-
board as a gift.
Ethnic Route
There are different ways in which a brand can be positioned using the ethnic
approach. It can
1. Identify specific behaviour(s)/practices that are connected with the

brand/product category.
2. Identify specific values in a cultural context, which can be inputs to mar-
keting communication.
3. Identify certain beliefs that need to be considered before an advertising
campaign is formulated.
4. Combine elements of a specific culture with changing cultural trends
(Westernization).
5. Capture a sense of nostalgia associated with a specific culture.
6. Use cultural stereotypes.
7. Identify specific cultural traits, which can be used for product categories/
brands.
A combination of several kinds of cultural dimensions makes it worthwhile
for marketers to consider positioning strategies oriented towards culture.
Cultural Behaviour
There are a number of behaviours that can be associated with a specific cul-
ture. Some of these have their origin in certain kinds of beliefs that are associ-
ated with product categories. For example, the bindi worn by Indian women
is considered as an integral part of most cultures. Hence, it is essential that a
brand name for such a bindi should have an ethnic sounding name. A Western
name is likely to be counter-productive. An interesting example of effective
use of cultural behaviour is the Pepsodent TV commercial a few years back.
Snacking on the way to school and back has been a cultural habit of Indians for
many decades now. It is a behaviour that can be associated with the masses.
The commercial for the toothpaste captures this and the traditional behaviour
of the mother scolding her child. This gets the attention of viewers before the
brand benefit of “protection” is conveyed. Regardless of the extent to which this
TV commercial contributed to the success of the brand, this example reflects
the need for marketers to have insights from the daily life of consumers in a
specific cultural backdrop. Even Maggi noodles (noodles is not of Indian ori-
gin) was positioned as a 2-minute convenience snack for children. The cultural
practice of providing homemade snacks as food to children was the thought
behind the Maggi campaign. The portrayal of whiteness in clothes led to the
creation of the whitener category for clothes and Robin Blue was almost a
household name before Ujala was launched. Whiteness, to masses in India,
is the whiteness with a bluish tinge. The practice of using soap for washing
clothes is so old that a brand like Ariel, which pioneered compact detergents at
the upper end, had to introduce soap at the lower end of the market. It is inter-
esting that Ariel initially advertised that soap was not required if one used a
compact detergent for washing. Samsung has introduced a washing machine
to ensure that sarees do not get entangled.
Importance of Cultural Values

Cultural values are important for product categories and positioning strat-
egies. Charms, the cigarette for the youth, was launched in the eighties and it
became a rage among young smokers. Its positioning was in consonance with
the changing values. “The spirit of freedom—Charms is the way you are” was
its punch-line that stood for adventure, independence and non-conformity.
The denim-like packaging added to this appeal. However, cultural values have
not changed enough for marketers to launch a cigarette for women (Ms was
launched during the eighties). Values are important because they reflect cultur-
ally acceptable behaviour. Valentine Day cards may have been a taboo a dec-
ade ago but they have caught on, at least in urban markets. Bacardi, the liquor
brand, positioned itself on the “spirit of enjoyment” (during the days of liquor
advertising) and its success among the intended target audience also reflects
the changing values. The launch of Close-up toothpaste during the eighties was
perhaps ahead of the values of those times. The “Close-up smile” was adver-
tised in cinema halls and was positioned at teenagers. Later, the permissive-
ness was marked down by using a different group in the commercial. Charms
and Close-up were one of the earliest brands, and were symbolic (along with
changes in the environment) in heralding a new youth culture in the country.
There may also be certain beliefs that have an impact on marketing commu-
nication. The Indian obsession with fairness has made Fair & Lovely a strong
brand. The recent TV commercial (that was later withdrawn) of the brand is
based on the deeply-entrenched cultural belief that a son is better than a daugh-
ter. But the daughter proves that she can be as successful as a son, and the equal-
ity was possible because of Fair & Lovely. Vicco turmeric cream positioned itself
as a fairness cream for the “brides-to-be” to enhance their complexion. Tur-
meric for skin-care is part of the Indian tradition in many parts of the country.
Vicks Vaporub captured the emotional bond between the mother and son to
convey the benefit of the brand. Clinic Special also captures the care an Indian
mother showers on her daughter. The “family togetherness” is a cultural aspect
of India, which marketers can use. Lifebuoy has re-launched as a family soap.
While family soaps like Protex and All-Care have not met with great success in
terms of being present in the market for a long time, the “family” platform for
Lifebuoy may be appropriate, given the rural presence of the brand.
While Pond's talcum powder was virtually a household name till the eight-
ies, a significant cross-section of talcum powder users may have switched over
to creams/lotions because of the belief that “self-enhancing” powers are bet-
ter with substitute products. A brand that masses accept because of a cultural
belief should launch several variants/better alternatives of the product for the
same segment to ensure that the target segment stays with the brand.
Asian Paints is a good example of a company's attempts to associate its
brands with several festivals in the country. For example, many families, espe-
cially in semi-urban and rural areas of Tamil Nadu, believe in repainting the
house during Pongal. Asian Paints has created specific brands, which can be
associated with such occasions.
Mixing Culture with Changing Trends

A type of effective cultural appeal consists of mixing certain cultural beliefs
with trendy products or advertising. Promise toothpaste, which had a success-
ful run, highlighted the traditional clove oil used by people to control tooth-
aches. Cadbury's recent television campaign (for molded chocolate) shows
people of different age groups enjoying the chocolate with a well known celeb-
rity endorsing the brand. Normally, one associated chocolates with children
in the Indian context. But decades back the brand 5-Star from Cadbury posi-
tioned itself as a “togetherness bar” for the youth segment. (In fact, this was
even before Charms or Close-up addressed this segment). Snacking is a part of
the Indian culture. Positioning a chocolate for adults in India involves a mix of
tradition and modernity, which, in this context, is Westernization. Chocolate,
in the West, is a favorite with adults as well. Cricket has been so long a part of
the Indian culture that Pepsi used it in its campaign “for the younger gener-
ation” and associated the brand with the fun that goes with the game. Raaga
collection from Titan is another example of contemporary positioning with
ethnic overtones.
Cultural Traits and Their Importance A few brands have used Indi-
anness to make an impact on their target segment. “Believe in the best”, which
highlighted the superiority of Indian-made BPL products featuring Amitabh
Bachchan is an example of a specific cultural trait being used to reinforce a
brand that had already built a strong image over the years. The “Hamara Ba-
jaj” campaign (the old and the new) blends the modern lifestyle with ethnic
beliefs. The message of the positioning is that even though the current crop
of young people is Western-oriented, they have a core association with ethnic
values. Ruf & Tuf came up with an excellent commercial in which a modern
youth reflects the cultural trait of respect for elders. “ We know English. We
also know how to respect elders” was the essence of the TV commercial. The
examples are old ones but they showcase the unique aspects of Indian market-
ing history associated with cultural aspects.
Other Cultural Appeals Nostalgia for a specific culture can be a good

appeal, especially for a brand which has been in the market for a number of
years. Margo soap adopted this approach in its advertisement, in which a
young woman remembers fondly her childhood days. Subsequently the brand
used a well known female celebrity to endorse the goodness of neem based
on her association with elders who had recommended it. Ayurvedic concepts
(now Himalaya) used the stereotype of a traditional grandmother to promote
its products made from the traditional ayurvedic herbs and preparations. Such
cultural stereotypes lend credibility to the brand (Refer Plate 16). Bru initially
used the stereotype of “the taste of filter coffee”, which is a part of the South
Indian culture.
Cultural dimensions can matter to many products, and such inputs are
valuable to marketers for both Indian and MNC brands.
Touch of Reality
Branding Associations and Cultural Practices
Cultural beliefs and practices can be innovatively used by brands.
Meera is a herbal shampoo brand and the brand name, ingredients
and packaging have strong associations with the cultural aspects
associated with shampoo and beauty. The brand launched an inter-
esting TV commercial that showed a dialog between the mother and
daughter (this kind of relationship is very traditional in the Indian
culture and the mother's tips on various aspects of life to her daugh-
ter is also a traditional one). The advertisement begins by showing the
daughter who says she is weak in maths (also a frequently encoun-
tered belief among school-going children and parents). The daughter
is shown fidgeting with her hair (also a traditional practice commonly
seen) and the mother comments that her hair is also weak upon notic-
ing fallen hair in her daughter's hands. The advertisement ends with
snippets of the daughter using the brand and turning out to be strong
in maths, with her also acquiring strength from the brand of shampoo.
Hamam, the popular soap brand in the southern markets intro-
duced herbal variants and it also launched advertisements with clear
images of cultural practices. One of the TV commercials begins with a
man performing suryanamaskara (a religious prayer in the culture), the
lady of the house dressed in traditional apparel and finally ending the
commercial with the brand's proposition of “auspicious beauty”.
Plate 1  In the highly competitive soap market, ITC has introduced the Vivel
range with strong functional benefits. This advertisement was backed up by
celebrity advertisements. Refer Page 92.
Plate 2  Refer Page 124.
Plates (2–4)  Titan: Fashion, heritage, technology, functionality and price points
are specific associations linked with the product category of watches (category
based). Sports and film celebrities are a part of the Indian consumer behaviour (con-
text based).
Plate 5  Fiama Di Wills, from ITC, uses “gentle naturals and effective sci-
ence” to position its range of shampoo and soaps at the higher end of the price
structure in the respective market. Refer Page 131.
Plates (6–7)  Van Heusen’s core values and associations of “aspirational, inner con-
fidence, stylish and sophisticated” are reflected in the brand’s contemporary approach in
tune with trends associated with the target segment.
Plate 8  Saffola’s association with health has created a memorable association in
the psyche of consumers. Refer Page 164.
Plate 9  Fastrack‘s associations of youth and fun have been extended into the category of eye wear. Refer Page 177.
Plate 10  Purehands: Himalaya’s new concept offering of antiseptic solution
without soap and water is in tune with the health and fitness culture among urban
consumers. The herbal touch adds to the appeal of the offering. Refer Page 227.
Plate 11  Parachute: The traditional goodness of co-
conut oil has been enhanced into a value added offering
by Parachute. Therapie—an interesting example of dif-
fusing a brand in a category with which consumers are
familiar. Refer Page 236.
Plate 12  ISKCON: India’s cultural diversity is reflected in its sub-cultures. ISKCON, Bangalore, is a religious
sub-culture having a number of followers with its values of compassion towards all forms of life and “food for all”
motto. Its Akshaya Patra scheme feeds lakhs of children below the poverty line in Bangalore. Refer Page 254.
Plate 13  Surf: In an emerging market like India, brands need to take into consideration certain aspects of cultural
practices unique to its context. Using a detergent bar for hand-washing clothes is an established practice among a
large cross-section consumers and Surf Excel bar is positioned for such a segment. Refer Page 261.
Plate 14  PalakPaneer: Bangalore-based MTR combines consumers’ cravings for
traditional delicacies with a touch of convenience, in tune with contemporary life-
styles, in its range of fast foods. Refer Page 265.
Plate 15  Sonata: Titan’s Sonata uses Indian culture to appeal to its target segment.
Refer Page 269.
Plate 16  Neem: Himalaya has launched a number of branded herbal offerings.
The usage of herbs is a strong cultural practice in India, and Himalaya extends such
a practice to suit contemporary lifestyles. Refer Page 272.
11
Retailing and Consumer

Behaviour Linkages to Branding
Retailing, in the Indian context, is undergoing a radical change with modern

retail outlets spreading across the country. About 97% of the retail off-take
comes from small or kirana shops (neighbourhood shops or “pop and mom”
shops). There are about 15 million of these shops across the country and a
significant proportion of these are managed by family members. Even large
multinational brands depend on wholesalers who feed these kirana shops in
several markets across the country. There are also varying sizes of kirana shops
depending on their location (in urban or rural areas). A typical kirana shop
carries merchandise that is absolutely required by consumers residing in the
vicinity of the shop. The kirana shop does not offer extensive selection of mer-
chandise in terms of stock keeping units (sizes of packs and variants) or in
terms of the type of product categories.
With several modern retail outlets and malls mushrooming across the
country and the historical dominance of kirana stores in the country assumes
special significance in the Indian retailing context.
Decision making on retailing is very similar to CDM (consumer decision
making) on brands where the consumer goes through the entire process begin-
ning with “needs” to “post-purchase decision making”. There are a few inter-
esting and important dimensions associated with consumer behaviour and
retail outlet selection:
 Does the retail outlet have psychological implications on the target seg-
ment? When Titan watches were retailed through exclusive shops, con-
sumers who wanted lower-end watches perhaps felt that the typical Titan
showroom was far too elitist for them. This could have had a negative
impact on them.
 Does the selection of outlets vary in accordance with the types of product
categories?
 While buying a TV or washing machine, will consumers visit an exclusive

showroom of LG, Samsung or Whirlpool, or will they go to a multi-brand
outlet? Will there be differences in the psychographic (and demographic)
profile of consumers in terms of choosing the outlets? What is the
sequence in which the consumers are likely to go about their decisions?
Will they select the brand or the category before choosing the outlet?
 What is the impact of the image developed by a retail outlet? Is Reliance
Mart, for example, different from the neighbourhood grocery shop in
the perception of consumers? What kind of perception are the con-
sumers likely to carry with regard to shopping from an online outlet
like Rediff vis-à-vis a brick and mortar outlet like Fountain Head or
Landmark?
 Will consumers be interested in store or retail brands? Traditionally, retail-
ers have been stacking manufacturers' brands. In the recent times super
markets like Nilgiris have started carrying retail or store brands.
 What contributes to retail equity (the value a retail outlet holds to a
brand), retail image or retail loyalty?
 How do retail outlets handle perceived risks?
Marketers need an in-depth knowledge of the various dimensions that link
retailing and consumer behaviour. Research is needed to handle retail deci-
sions in a competitive context. A few companies operate through kiosks at
airports, malls and high-traffic areas. Online retailing, too, may perhaps hold
tremendous potential in services, where the consumer requires a good deal
of interaction with the service provider (financial services, travel services and
music downloads).
Retail Outlet Selection and Brand Selection

There are three fundamental patterns that a consumer can follow: (i) brand
first, retail outlet second; (ii) retail outlet first, brand second; and (iii) brand
and retail outlet simultaneously. A consumer wanting to buy a car (informa-
tion search on brands is followed by retail outlet selection in durables) may
collect information on brands and purchase the one he/she wants from a retail
outlet based on his/her perception of the price offered and/or post-sales ser-
vice provided by it. In certain product categories, especially where “category-
killers” (large retail outlets, which deal with several brands and variants) exist,
and consumers may first think of the retail outlet and then the brands. Televi-
sion, refrigerator and audio products retailed through outlets like Vivek & Co.
are examples. Another dimension may be to compare the brands in the evoked
set that are at the retail outlets.
This is possible, especially in the Indian context where dealers in semi-
urban/rural areas develop a bond with consumers. Primary research can be
used to find out the specific sequence involved in such a situation. The “brand
first” dimension may need a “feature-based” advertising and the “retail outlet
11  Retailing and Consumer Behaviour Linkages to Branding 293
first” dimension may require POP material and special training to sales per-
sonnel (at the retail outlet) to recognize consumer needs. Further, if it is known
that a number of consumers are inclined on visiting their favorite retailer in a
geographical area, there has to be more emphasis on regional/local advertis-
ing, which highlights the retail shop rather than the brands.
Retail Outlet First and Brand Second When a number of consumers

follow this sequence of decision making, the point-of-purchase material and
building of the image of the outlet become important. The manufacturer of
the brand has to ensure that the brand and its variants are available at the key
outlets in a locality. Point-of-purchase material to be used at the retail outlet
may require primary research on whether visuals or product features are to be
used and if the material should be in the regional language. There may also
be a need to monitor competition from other outlets to ensure that consumers
remain satisfied on counts of service, price, promotional deals and ambience.
This is especially applicable to durable retailing in India (in cities). Retailers
attempt to increase consumer traffic by providing a number of add-ons.
Brand First and Retail Outlet Second Consumers think of the brand
first if: (a) they have not developed a strong relationship with any retailer to
allow the latter to get into the “evoked retail set” or (b) the brand has got into
the evoked set either because of advertising or positive word of mouth. If local
or regional advertising (in the shopping guide, which appears every week in
the local newspapers) has a list of brand names that have already got into the
evoked set of consumers, it will enable consumers to be “pulled” to the outlet.
Primary research may be required to find out the brands in the evoked set. This
feedback may have to be provided by the respective manufacturers to the retail-
ers in various geographical areas, especially if the brands have a major chunk
of the market and are nationally advertised. Even multinational outlets can use
this approach and mention the brands in the evoked sets. This is likely to in-
crease the traffic to the outlet. Besides, the evoked set can also change depend-
ing on the strategies of brands. Local advertising can be different from national
advertising for the brand. A brand may be advertised on features nationally, but
on the plank of effective after-sales service at the retail level because that is the
local priority. The combination of “push–pull” strategy is shown in Figure 11.1.
The interest generated on the brand has to be backed up by good pre-sale
services at the outlet.
Brand and Retail Outlet Simultaneously When consumers think

of the brand and retail outlet simultaneously, it means that they have a cer-
tain preference for the outlet and will also like to check out the brands in the
evoked set at the retail outlet. The marketer has to do primary research to find
out specific markets (geographical areas) where consumers have a positive
relationship with retailers. This is important because of the retailers' influence
on the purchase behaviour of consumers in India. He/she may also check if
Brand
“Pull” (advertising strategy—USP)
“Top-of-the-mind” recall (Target segment)
Retail outlets in geographical area
Local advertising with added USP
Increase in store traffic
Pre-sales service at the retail outlet
Brand purchase
Figure 11.1  Brand First, Outlet Second—‘Push–Pull’ Approach
the retailers have the brands in the evoked set of the target segments. This is to
ensure that the retailers who have a bond with the target segment do not disap-
point the consumers merely because of the non-availability of the brands and
send them to a different retailer.
Retail sales personnel become important in this situation. Prospective con-
sumers are “carried over” to the purchase stage by the store personnel, and
hence, there should be incentive programs for the latter. If a company like
LG or Sony is dealing with a number of brands/sub-brands, it has to ensure
the availability of specific brands that may interest consumers. If it is a large
retail outlet dealing in a number of brands (like Vivek & Co in the South),
a shop-in-shop arrangement may be preferable. A shop-in-shop arrangement
creates a focus on the brand and reinforces the positive opinion a consumer
may have had about the brand (in this context). A considerable amount of pre-
sales service has to back up the shop-in-shop concept. This concept creates an
aura of exclusivity inside the retail outlet and consumers tend to have higher
expectations on count of pre-sales service and the attention they receive.
A large store is also likely to stock several brands. Hence, all brands in the
evoked set have to compete to get into the choice set. Large outlets may also
have a provision for lower prices (because of large volumes), and hence, may
be in a better position to clinch the deal with consumers who consider the
brand and retail outlet together. With malls evolving in cities and towns,
brands should consider the possibility of being located in a mall for reasons
other than profitability, depending on the target segments involved. Affluent
teenagers interested in iPods or digital cameras are more likely to visit the out-
lets if these are situated in malls/large shopping complexes.
Retail Image—Basics
As in the case of brands, retail outlets also form or carry images in con-
sumers' minds. Primary research can point out the perception of consumers
on various aspects/dimensions of a retail outlet. A small retailer can also
use this approach. A retailer in a given area can develop a perceptual map
consisting of the relevant dimensions to get an idea about how consumers
perceive a set of competing retailers. Another aspect associated with retail
outlets is that consumers tend to use the image of a retail outlet as an indi-
cator of quality in the absence of brand cues. For example, if a packaged
unbranded commodity is marketed through a well-known departmental
store, the image of the retail outlet stocking the offering will influence the
latter's image. Service counters, queue management, billing, merchandise
display and the variety of product categories stocked by the retail outlet
(apart from SKUs) influence its image. Retail image is also important in
Internet marketing. An online retailer has to have an image of “convenience,
trust and quality”, much like a brand name, to ensure that loyal consum-
ers continue to transact business with him/her. Besides, as consumers' trust
increases with time, the online retailer can get into product categories that
consumers may buy more frequently.
Dimensions Associated with Retail Image

In today's competitive era, it would be difficult for retailers to leave a lasting
impression if they attempted targeting all types of consumers. The need is to
target only specific kinds of consumers and develop relevant associations with
them. For example, Shoppers Stop may be associated with a pleasant, easy
going shopping experience and a satisfied loyal consumer who can benefit
from the deals that the store offers. Food World may be associated with value
in FMCG products and groceries. Landmark may be synonymous with the
variety it offers in books. Marketers can control the kind of associations that
need to be developed to provide the required differentiation. There may be a
store that sells well-known brands at a lower price and does not offer much
in store help. A network of such stores can develop an image of convenience
and value (by planning the locations). Another aspect of store image is the
shopping area. Different shopping locations in a city have different kinds of
images among consumers. In Bangalore, for example, Commercial Street is
more known for textiles than consumer durables. An upmarket consumer dur-
able located there will find it difficult to attract traffic (unless it is planned on a
large scale in terms of merchandise and visibility). Similarly, an upmarket tex-
tile store in a predominantly discount oriented shopping area may not attract
the attention of the intended target segment, which may have a symbolic need
(of even shopping in an exclusive locality) with regard to the shopping area it
visits.
There may be several dimensions associated with retail image, and exten-
sive primary research has to be done to ensure that a retail store does not select
too many dimensions and dilute its store positioning strategy. Product asso-
ciations can stand for quality, variety, style or price. Service can develop its
associations with sales personnel, pre-sales or after-sales service, easy return
of faulty goods, shopping ease or delivery. Consumer imagery can be devel-
oped by associating a specific type of consumer with a retail outlet. Ambience
can be associated with decor, lighting, moving space, layout, cleanliness and
comfort. Convenience can be associated with locations and parking. Value can
be associated with low prices, bundling of products at a low price, delivery or
a combination of these dimensions. Choosing and nurturing the right image is
a prerequisite for the long-term profitability of any retail outlet.
Store Brands
Store brands are the ones that are carried in the name of the store or the name
of a private label. As competition intensifies in a category, retailers are likely
to develop brands in the name of the store or independent brand names that
can be stocked at their retail outlets. National brands, or well-known brands of
manufacturers, are likely to face stiff competition from store brands, especially
in retail outlets that have high consumer loyalty. Loyal consumers are very
likely to try out store brands as their confidence in the store's brand name is
likely to be high. Store brands, therefore, should necessarily offer high quality
and perhaps, position themselves on value. There is a need to avoid the trad-
itional approach of store brands providing acceptable quality at lower prices.
This is essential because many national brands are taking this route in categories
like soaps, shampoos, biscuits, commodities, toothpastes and beverages.
A retail outlet may research the pattern of consumption of store brands it car-
ries across categories. If the store has a chain of stores, it may be worthwhile to
observe the impact of store brands in different geographical areas.
A retail outlet has certain advantages and it should consider the following
before launching store brands:
 Analysis of product categories: If there are several national brands across

categories with offerings at close price points, a store brand may find it
difficult to enter the category. Variety, SKUs and constant sales promo-
tions add on to the appeal of such buying situations (Reliance Mart in a
locality that already has a number of departmental stores, but not offering
the kind of variety and prices offered by a large format retailer)
 Distribution of national brands: If well-known brands are widely available
at different price points, a store brand may find it difficult to have a pres-
ence in the market in India.
 Specialised offerings: There may be specific markets/niches, which may
not be served by national brands. Store brands can use these gaps in
the market to come out with suitable offerings. Herbal soap is one
example, and super market chains carry brands like Medimix, Vrinda
and Krishna Tulasi as store brands (some of these brands may not be
as freely available as national brands in grocery stores). Special Assam

tea made by independent brands can be seen in More outlets. There can
also be upmarket niches like homemade chocolates and snacks, which
can be marketed as store brands.
 Are there enough brands to develop the market? There may be categories like
floor cleaning and dish-washing powders/liquids that are largely con-
fined to the unorganized sector and these categories may offer scope for
the creation of store brands. For example, there are only a few national
brands in the category of floor cleaning and a huge market can be
developed as the penetration level of the category is low. Store brands
have the opportunity of capturing a considerable amount of the neigh-
borhood markets, if value is provided. Value can even mean the safety of
using a floor cleaner associated with the private label.
 Can demand be met? A store brand should be available at the outlet to meet
the demand for it, if consumers show a marked preference for the brand.
This is important because once a consumer finds that the supply of the
store brand is not consistent (though of good quality), he/she may go
back to one of the national brands, which are usually always available.
Advertising and Retail Outlets

An outlet may deal with several product categories and there may be a need
to advertise on two aspects:
1. A continuous form of advertising (taking into account the reach, cost
and the choices available for media selection), which would ensure the
positioning of the retail outlet on the dimensions of what it “stands” for
(or the type of associations on which it would like to be perceived by the
target segment).
2. Specific advertisements on product categories and promotional prices
(including sales promotional offers), whenever it is required. For
example, a festive occasion may require certain types of advertising,
which will “pull” consumers to the retail outlet (especially in the case of
durable products). A retail outlet marketing fast foods and soft drinks
may like to target children during their summer holidays. There may also
be specific offers targeting housewives.
A planned process helps a retail outlet convey a coherent and focused per-
ception of the image of the store. The following aspects require careful consid-
eration while a policy on retail advertising is formulated:
 The positioning of the product is important, and there should be no
advertising that dilutes the planned positioning dimensions. An upmar-
ket store dealing with apparel can certainly run sales promotional
campaigns. It has to ensure that the upmarket associations are continu-
ously built over a period of time. It has to also ensure that frequent sales
promotions do not dilute the credibility associated with the upmar-

ket associations. The firm can have a salespromotion once or twice a
year (during a festive occasion depending on its target segment), and
emphasize the association with such sales promotion by using phrases
like “Now only” or “Once in a year” or “Special sale”. It may also be a
good idea for the retail outlet not to deal with seconds (even if prices
are reduced). When an upmarket store announces a sales promotion, its
objective should be to enlarge its consumer base by offering “trial value”
which really is offering good quality products at prices that are slightly
lower than the usual prices so that more consumers are added during the
sales promotion period. These consumers may buy frequently from the
retail outlet after being convinced about the merchandise of the upmarket
store. Apart from creating a new loyal consumer base, the promotional
offer will also benefit the existing consumers. An upmarket store should
ensure that, apart from layout and ambience, consumers appreciate
“value” at a higher price point.
 Advertising for one product category (with or without an offer) should
result in “spill-over sales”. This means consumers entering the store for
a particular item/category should also be motivated to buy some more
items apart from their planned purchase.
This can be done by:
1. Having attractive POP material for categories other than the one
advertised
2. Having a good layout, which will attract attention on related prod-
ucts from the viewpoint of either perception or consumption. For
example, an offer for soft drinks should ensure that the brand on offer
is stocked near snacks. If a lifestyle outlet is advertising for apparel, it
has to ensure that shoe brands (which also have a lifestyle appeal) are
stocked near the brand of apparel.
 When a store advertises on just price (“discount” stores), it has to ensure
that consumers compare the advertised prices either with their internal
reference price (price range normally considered by consumers for the
product category), or external reference price (the price of the advertised
brand in other outlets).
A synergized approach taking together the image of the store, POP, planned
offers and advertising can result in creating an impact on the target segment.
Location and Size Consideration

Consumers' perception is shaped by an outlet's location and size. Location has
to take into account the target segment and the merchandise. Grocery stores
should be located in residential areas. But if a large store deals with several
categories (and SKU's) of products, it can locate itself in a prime shopping
location in the city, as consumers will want to combine their purchases when
they visit the location. Consumers, not particular about fast service or conveni-
ence, will prefer large outlets. The following aspects should be considered by a
retail outlet store when planning its size:
(1) The size and retail traffic of competing retailers in a given geographi-
cal area.
(2) Travel time involved for the target segment.
(3) The importance placed on fast service.
(4) The kind of product categories to be marketed by the outlet. Even will-
ingness to travel to an outlet will depend on the product category. Con-
sumers may not mind travelling a distance if they are assured of value in
the case of high-involvement categories.
(5) Area of shopping. Lifestyle brands like Tanishq, Rolex or Reebok may
attract better retail traffic if their exclusive outlets are located in a shop-
ping area, which is full of similar outlets.
(6) When category killers plan for high-involvement categories, they should
consider parking space. Hence, they need not necessarily be located at
prime shopping locations (like lifestyle outlets) because consumers will
be willing to travel a distance to buy value. A shopper who is interested
in buying a colour television for Rs 15,000–20,000 will not be reluctant to
travel a few kilometres if he/she perceives value in an outlet.
(7) If outlets marketing high-involvement categories are slightly away from
the prime shopping area, they must ensure that the service provided for
installation and delivery is part of the package. Charging extra for such
services is likely to dilute the “value” perception. Location and size con-
sideration will not only have an impact on consumers, it can also save
overheads for the outlet.
Perceived Risks and Retail Outlet Choice

There are two kinds of risks faced by consumers when they buy a product.
One is the social risk (as in the case of acceptance of fashion apparel). The
other is the economic risk like repairs, performance, effort and even physical
risk, besides the cost of such physical risks (side-effects of using a hair-dye).
Figure 11.2 provides a fundamental approach towards identifying the differ-
ent kinds of risks involved, and the kinds of categories that may be affected
by the risks.
Different sets of consumers perceive the risks differently across product
categories, and some primary research is required to identify the appropriate
risks associated with a given target segment or product category. Perceived
risk is both a consumer and a product characteristic.
Retail outlets also carry a “risk” perception. New kinds of retail formats
like Internet shopping and direct marketing may be associated with a higher
Economic Risk
Low High
Low Beer (home-use) PC

Petrol Auto repairs
Social Risk
Antiseptic lotion Washing machine

Floor cleaner
High Designer wear Cars/two-wheelers,

Beer (entertaining) Living room furniture,
Deodorant Watches (premium)
Hairstyles
Figure 11.2  Product Categories and Risks
degree of perceived risk. The following aspects revolve around perceived risks
and specific retail outlet strategies:
(1) New kinds of retail outlets (marketing through the Internet) should
lower the risk by reassuring consumers on the security of their pur-
chase (especially if credit cards are used). Consumers also feel secure
when they know that they can return a faulty product without much
inconvenience. There may be products, which involve a considerable
amount of social risk. Some outlets give consumers the choice of return-
ing the product if they are not satisfied purchases. A consumer may buy
designer wear or jewellery through the Internet, but may not like the
design (in spite of sampling it on the site). The option of returning the
product encourages him/her to shop at non-traditional outlets. This will
also spread a good word about the outlet.
(2) Discount outlets should ensure that well-known brands are available to
reduce the perceived risk associated with the purchase.
(3) Traditional outlets (large supermarkets) have a clear advantage with
high-risk items (it may not be much in durables). Hence, they are in a
position to develop store brands in a few categories associated with high
economic risks (food categories, kitchen appliances). Store brands (apart
from being promoted through POP material) also have the advantage of
being associated with the store image.
(4) If a retail store dealing in durables provides efficient after-sales service
while dealing with well-known brands (especially in an environment
where brands score low on after-sales service), it will be able to lower
the perceived risk to a significant extent.
Consumer Shopping Types

A retail outlet has to design itself taking into consideration different types of
shoppers and the manner in which they shop. A retail outlet can select specific
segments and decide on its target segments. Shopping is viewed as an activity
that goes beyond purchasing products. It involves social interaction, learning
about new products, trends and sensory stimulation. Shopping orientation refers
to specific emphasis on certain characteristics of the shopper. Lifestyles of shop-
pers determine, to a great degree, the type of shopping they pursue. Inactive
shoppers are not much into shopping. Active shoppers are those who enjoy the
activity and one of the major criteria in their search may be the price. There are
shoppers who are serious about the kind of shopping, which reflects in their
lifestyle. Hence, they consider quality, fashion and symbolic aspects of a brand
along with the price factor. Service shoppers need and demand in-store service
while shopping. An outlet catering to such shoppers should have friendly, help-
ful employees. They may have to explain to the consumer, many aspects associ-
ated with brand comparison. Dedicated fringe shoppers are those who rely on
heavy catalogue shopping. They want to be different and may not socialize a
lot. Price shoppers are highly price-sensitive and may be willing to extend their
search efforts to identify products/services that are offered at low prices.
There are several implications of shopping orientation/styles on retailing
strategies. Inactive shoppers may be more oriented towards online purchasing
and may prefer home delivery. Active shoppers may enjoy the buying experi-
ence at retail outlets. For example, a supermarket may have a food court to
provide the “experience of socializing” if its target segment consists of active
shoppers. A discount outlet, stocked with leading brands, may attract the
attention of price shoppers in the appropriate residential area. An outlet would
do well to analyze the demographic and psychographic profile of consumers
in a specific area and draw inferences about the shopping orientation of con-
sumers in that area. For example, there may be more than two types of orien-
tation with regard to shoppers in a specific area. This may call for different
strategies. There may even be a need to use different store brands for different
segments. Apart from decor and layout, the merchandise, SKUs and the ser-
vice provided will vary depending on the shopping orientation involved. A
planned approach enables the outlet to take decisions on its viability. Price-
sensitive consumers, for example, may expect a high level of in-store service.
In this situation, unless assured of huge volumes (which will be possible only
by stocking a range of items and brands), it may not be feasible for the outlet
to park itself in that geographical area.
Retail Outlets and In-store Purchases

A consumer may visit a retail outlet with an intention of buying a brand or a
product, and end up buying additional products as well. Normally impulse
purchase is referred to as the lack of rationality in the buying decision. While
this may be true in a number of buying situations, there may be exceptions.
The decision to buy Bournvita (against Complan as planned earlier) after

entering the store because the brand is on sale is not illogical even though a
certain degree of impulse is involved. An unplanned decision may help the
consumer take advantage of a sales promotion. There may be several kinds of
“store” decisions:
(a) Specifically planned: The consumer may decide which product or brand to
buy even before entering an outlet.
(b) Generally planned: The consumer may decide to buy a product category
such as cosmetics before entering an outlet.
(c) Substitute: The consumer may buy a substitute item after entering an
outlet. For example, he/she may buy a brand of fresh juice instead of an
aerated soft drink after looking at the promotional material in the store.
(d) Unplanned: A consumer may pick up an item he/she didn't think of
buying, after entering the store. Research shows that in a number of cat-
egories, consumers make item or brand decisions after entering an out-
let. Hence, in-store marketing strategies are important for retail outlets.
This may be especially applicable to product categories that are not pur-
chased frequently (like mouthwashes or antiseptic lotions). Researching
the buying decisions of regular consumers will enable a retail outlet to
plan an appropriate in-store marketing strategy.
The store atmosphere, which is concerned with layout, lighting, presenta-
tion of products, floors, colours, sound, fragrance, and behaviour of sales per-
sonnel may have an impact on in-store purchases. Atmospherics is concerned
with the physical retail environment that can impact the moods of shoppers.
Figure 11.3 emphasizes certain important dimensions of retail outlet strategies.
The figure shows that strategy formulation is an ongoing process. There is
a need to monitor the expectations of the target segment over a period of time.
Food World is present in a number of locations/cities in South India. This may
have changed the expectations of consumers with regard to several aspects
Target segment
Shopping orientation
Merchandise, atmospherics
Appropriate strategies
Figure 11.3  Retail Outlet Strategy Formulation

of retailing like value, service, returning a faulty product etc. Smaller outlets
competing with large outlets (at least in specific product categories) have to
introduce specific strategies to ensure consumer loyalty.
Importance of Avoiding Stock-outs

Ensuring sufficient stock of several SKUs and reinforcing profitability by turn-
ing around the stock is vital in retailing. A company like Unilever probably
has around 1000 SKUs across product categories. A retail outlet, today, has to
necessarily keep a track of the purchasing pattern—not only with regard to
brands and product categories, but also preferred SKUs. There may be four
aspects of consumer behaviour associated with a stock-out situation:
(1) Purchase behaviour may involve buying a substitute brand or item at
the same store.
(2) The purchase may be delayed until the preferred brand is available at
the same store.
(3) The consumer may decide to forego the purchase at least for the time being.
(4) The consumer may buy the brand at a second store.
The consumer may also decide to buy all the items he/she had planned to
buy, at the second store because of the non-availability of the favorite brand in
the first retail outlet where he/she had tried to buy it. Generally, in FMCG cat-
egories, the consumer either buys a substitute brand at the same store or buys
the preferred brand at the second store.
A stock-out situation can also lead to bad publicity for the store. This may,
by default, lead to positive publicity for competing stores. There may be a
good word for substitute brands as well.
Attitude development may also figure in a stock-out situation. The con-
sumer may develop a negative attitude towards the original store and a favor-
able attitude towards substitute brands and competing stores.
A retail outlet should constantly monitor the preferences of the target seg-
ment with regard to available merchandise and make changes therein. This
approach should also be extended to brands and SKUs/variants. In fact, a large
outlet should offer SKUs/variants (in popular product categories) that are
not available in a majority of the neighborhood grocery stores. This provides
a strong motivation for consumers to shop at larger outlets. There can also
be exclusive packaged deals (FMCG products) that can be made available at
large outlets by a special arrangement with the manufacturers of well-known
brands. Special services can be introduced to tackle stock-out situations. This
may involve home delivering those items for regular consumers. This will
strengthen the service orientation of the outlet, apart from providing a way to
deal with stock-outs. A stook run-out scenario can result in serious problems,
especially if it is a part of the outlet's strategy to eliminate certain products that
are not much in demand. The outlet should research, not just the off-take of
such items but also the products that are bought with them.
Box 11.1
The Death Spiral—An Important Aspect of
Managing Merchandise
Retail outlets can get into what is known as the death spiral. This is a
vicious cycle in which the retail outlet keeps eliminating “non-profitable”
items/products. This, in turn, reduces the demand for certain items/
products bought with the eliminated items/products. The outlet tends to
repeat its “elimination” round with a new set of items. Over a period of
time, the outlet traffic is seriously affected to the extent that the profitabil-
ity is also threatened. The following example will illustrate the importance
of the concept. Shoppers may buy bread regularly from an outlet along
with other items. These are regular shoppers, but may form only about
15 percent of the total shoppers. The outlet may find that cheese, butter
and jam are not profitable items and may eliminate them from its mer-
chandise without realizing that those 15 percent bread buyers also buy
cheese, butter and jam (though overall these may be unprofitable items).
By eliminating these items, the store may have, in fact, reduced its con-
sumer traffic. These 15 percent shoppers may begin going to other stores.
So, not only does the traffic reduce but the profits also go down. Once in
this vicious trap, the outlet may lose its consumers besides, of course, the
profits (see Figure 11.4).
Unprofitable items Fresh elimination

in the outlet of items
Elimination of Drop in traffic

unprofitable items
Cycle continues
Reduction in traffic
(Regular consumers don’t Loss of profits for the
visit the store as they outlet
have been buying
unprofitable items, but
jointly with other products)
Figure 11.4  The Importance of Complementary Products in Retailing

(The Death Spiral)
Dimensions of Retail Equity

Brand equity is the value a brand adds to a product. Retail equity is the value
a retail outlet adds to the brands or products it sells. Purchase happens at the
retail outlet, and hence, the equity added at this point enhances the image of
the outlet. In fact, retail equity draws consumer traffic in product categories like
jewellery though names like Carbon and Tanishq have been attempting to build
brands in this category. BPL, Titan, Carrier Aircon, Ceat and MRF are some of the
brands that have exclusive showrooms. It is this exclusivity that helps brands to
build equity. Titan virtually changed the experience of buying watches from the
regular bazaar shops to a retail world of comfort and feel-good ambience. This
is not to say that multi-branded outlets are not required. The Titan example only
reflects the importance of retail equity in building brands.
Importance of Image
As in the case of brand associations, retail outlets also have to nurture and
cultivate specific associations in the mind of consumers. In urban cities, the
“retail ladder” is important for marketers and retailers. Like “brand ladders”
in which consumers form a mental hierarchy of brands when they think of a
product category, retail equity aims at creating specific associations that create
a high degree of recall by placing a retail outlet on top of the “retail ladder”. For
example, when consumers think of value associated with consumables (gro-
ceries, and commodities), Food World may be on top of the consumer's mind, it
may be Music World for music and Health & Glow for health products. Retail
equity serves as a differentiator when consumers are confronted with hun-
dreds of retail outlets. Retail equity also helps the outlet have a better buying
power with large companies because of the volumes it is capable of achieving.
Developing Retail Equity—Importance of the

Target Segment
While the actual process of developing retail equity differs from one product
category to another, there are a few aspects, which may be useful to any outlet
concerned with retailing and the point of purchase.
Target Segment
The type of target segment being considered by a retail outlet defines the expec-
tations that the outlet will have to fulfill in terms of service, availability, product
assortment and layout. A typical buyer of a Titan watch is unlikely to be the
one who wants a watch in the range of Rs 150–250. There is a huge unorgan-
ized market operating in the watch category (50–60 percent of the total mar-
ket), and a high percentage of watches (around 50–60 percent) are sold below
Rs 800–1000. A consumer at the lower end of the market may, in fact, feel
uncomfortable in an outlet selling high-end watches. A grocer will only display
the products and brands in which the consumers in his neighborhood are inter-
ested. This is the reason why these outlets select product categories and brands
with great care. For example, Mother's Recipe, a brand of pickles, may not be
available at most retail outlets (including shops) that sell pickles. Awareness of
brands and expectations from retail outlets of the target segment is an import-
ant criterion for developing retail image.
Dimensions of Expectations
The next aspect to consider is the various dimensions that a specific consumer
segment might be interested in, when it comes to a retail outlet. There may
be a few situations in which the retail outlet may cater to a broad segment.
This happens when an outlet, as a brand, appeals to a big segment. A typical
example is of McDonald outlets all over the world. McDonald is known all
over the world for its value, cleanliness, consistency and convenience. These
expectations have been built over a period of time, and hence, it draws con-
sumers from all income, age and lifestyle groups. The brand, even today, offers
a variety, which appeals to distinctive segments.
An outlet should research the target segment and identify specific dimen-
sions that can be developed to attract consumers. Convenience for a fast food
outlet, fast check-out during peak hours for a departmental store and variety
for a music store, are important dimensions. At a time when life is fast, time
is scarce and pressures many, an emerging dimension is the need to enjoy the
atmospherics and shop at leisure. Shoppers Stop had positioned itself on this
dimension. It highlighted the total shopping experience in its visuals, backed
by the spread, ambience, decor, product variety and consumer-friendliness.
Black and white advertisements made a powerful statement on the feel-good
shopping experience. There were advertisements in which customers “talked”
of their experience. Fountain Head, the Chennai-based book store, has also
positioned itself on a leisurely shopping experience, which acts as a differen-
tiator for the book store.
Expectations grow and change, with changes in the environment. The con-
cept of Outlet Malls (normally located at the outskirts of the city) is another point
of purchase retailing option, which is becoming popular in the West. Manufac-
turers manage these outlets and offer a good shopping experience apart from
discounted, but not damaged, merchandise. Large layouts, open spaces and com-
fortable car parks apart from low prices, attract a specific segment to these outlets.
Planning the POP Process—A Vital Dimension

of Retail Equity
Retailing is about point of purchase and this is the final place at which sale
happens. POP strategies have to be planned as part of the overall strategy of
the brand/retail store. In the present context of multi-promotional plans, the
POP process has to be integrated into the entire promotional plan. This process
can be called integrated POP plan. Apart from conventional POP material like
posters and brochures, a POP plan, today, also considers factors like store lay-
out, parking place, atmospherics (which include mood enhancing elements
like music, decor and temperature systems) and systems that enable consum-
ers to transact business with ease and comfort.
Promoting Brands in an Era of Brand Proliferation

A supermarket, in today's context, sells a number of brands within a category.
The display or shelf space is limited. Besides, from the consumers' point of
view, certain brands may generate greater recall than other brands in the cat-
egory. In the category of soaps, Liril may generate greater recall than a new
brand of herbal soap in the same price range because of the impact of its adver-
tising over the years. While a strongly established brand attempts to retain its
existing consumers and also attract new ones from competitive brands, a new
brand has to appeal to consumers to try out the new offering. Added to that
is the tendency of even loyal consumers to try out new brands in a category
like soaps. This is the backdrop against which a typical FMCG brand attempts
to use POP material in the store. A store that deals with 20 brands of soaps or
toothpastes may have to promote all the brands most of the time. A special dis-
play and POP material have to be organized when the brand is on sale. But as
the number of brands increase in most categories, a store may find itself under
pressure to promote all of them simultaneously. Furthermore, there are many
variants (across FMCG categories) introduced in almost all brands to ensure
that the consumer stays with the brand. Colgate has a herbal version, gel ver-
sion and a Colgate Total, which offers several benefits. All these variants may
need to be promoted. Manufacturers need to be convinced that they are get-
ting a fair share of the retailer's attention.
Retail equity establishes a retail association in the psyche of consumers
and also enables the retailer to deal more competitively with manufacturers,
depending on how the latter executes that equity.
Retail Service
Service at the point of purchase has been often written about and discussed in
great detail. A contemporary dimension is the nature of the service consumers
expect in a specific retail setting and the nature of the product category itself.
Service, in the retail context, is the overall attention given to consumers that
can enhance their (retail) experience. This retail experience can also extend to
certain services beyond the point of purchase, as in the case of durables.
Importance of Appropriate Service

A retailer is concerned with the store image and service. The direct result of
the service provided can be seen in the way consumers talk about it with their
friends/peer-groups. A positive word of mouth (WOM) is the best “advocate”

for the store while a negative one can spell disaster. The importance of WOM
is reflected in the fact that large brands in developed markets conduct research
studies to quantify its impact in terms of sales gained or lost! Service also helps
the store to establish for itself, a specific proposition. This is important as it func-
tions as a differentiator. A consumer will appreciate a service that ensures faster
billing with separate counters for less than five items bought in a large store.
Service Varies with Product Categories and Type of

Retail Outlets
Service varies with the types of products and retail outlets. But the basic aspect
of providing service is concerned with the identification of consumers who
need help on entering a large retail outlet. Sales personnel should be trained
to provide appropriate and not unwanted service. Unfortunately, service is
mixed up with over enthusiasm that is reflected in artificial hospitality at the
retail outlet, which certain consumers may not like. The attention given to a
consumer should always be perceived as warm, spontaneous and appropriate.
It should never be associated with unnecessary intrusion.
FMCG products, commodities and groceries are categories, which require
little “on-store” service. Normally, consumers are discerning enough to sift
through the information on brands, prices and sale offers (if this kind of basic
information is made available). Hence, the “off-store” service becomes import-
ant. Apart from free home delivery (on certain conditions) offered by super
markets, the reassurance provided on the quality of products is extremely
important, especially in the case of groceries, and commodities and vegetables
that are not branded. Consumers visit these large retailers in the hope of find-
ing value on such products (a combination of price and quality). Dissatisfaction
on this count can force them to return to their neighborhood grocer or look for
other options. The perception that super markets are shopping places for the
middle class is of recent origin and is based on the variety and quality associ-
ated with their goods. Consumers should never be let down on this proposition.
Complaints about the lack of quality, freshness, improper packaging and under-
weight packages should be immediately attended to and consumers should not
get the feeling that the store is doing them a favour by replacing the product. If
required, changes in the procurement process or supply chain may have to be
made before the store loses its reputation on its core promise. That unbranded
products are (relatively) more important from the viewpoint of the store cannot
be overemphasized. The store is important for the consumers because it stocks
what they really need to buy, as against branded FMCG products, which are
picked up more because of the “pull” effect created by manufacturers.
Speciality Products
High-end products (expensive jewellery, furniture or designer wear) are
those that draw consumers because of their lifestyle and symbolic appeals.
While brands may also play a role in attracting consumers, a retail store
needs to offer a different kind of service. Allen Solly's exclusive showroom
is a good example to illustrate this point. The consumer goes through an
“experiential” service, especially if the product is of personal significance.
The product display at Allen Solly's exclusive shop is such that the con-
sumer could go around and feel the fabric before trying it on. Digital kiosks
can also be used to give an idea to the consumer about how well the prod-
uct will match him/her. These kiosks enable the consumer to try out differ-
ent designs/variations of the brand, enabling him/her to decide on the one
which is most suitable.
In the case of readymade wear, what is usually wanting is the “fit”, with
which the consumer is concerned even after selecting the design. The retail
store personnel can help, but in an unobtrusive manner. This aspect of service
is also associated with the availability of SKUs and management of inventory
that takes consumer needs into consideration.
“The experiential service”, which consumers experience at the point of pur-
chase can also be extended to categories like perfumes and cosmetics. Lakme
introduced a plan at the point of purchase for its Orchids range of cosmetics,
in which a consumer could try the product before deciding on the purchase. It
should be noted that in such categories, a free trial is possible only in the pre-
mium price range.
The Feel of the Product

“Experiential service” can be extremely effective if applied to audio and video
durables. BPL has exclusive galleries in some cities that display its products.
Carrier Aircon and Onida are other brands, which maintain such exclusive
showrooms displaying a range of products/variants.
If the retail store can help the consumer simulate the experience of lis-
tening to an audio system in a “house-like” setting or the coolness of an air-
conditioner in a room similar to the consumer's, it not only helps the consumer
but also the store. Such a trend can have a significant impact in detailing the
benefits of a brand. A part of the promotional budget can be allocated for such
point-of-purchase experience.
Service for Durables

Leading brands like Videocon, LG or Samsung deal with a number of prod-
uct categories (audio, TV, refrigerator, microwaves etc). Word of mouth has
an even greater impact with regard to durables. A consumer of a TV may be
a prospective consumer of a refrigerator or an audio system. There are two
aspects to be considered with regard to service for durables: service provided
by multibrand outlets (like Vivek and Co) and service provided by an exclu-
sive outlet. A leading brand is likely to be present in about 3000 to 4000 outlets
in the country and not all of these are exclusive. Such a differentiation can also
help the brand improve its infrastructure and location considerations, apart
from enhancing customer satisfaction.
The Credibility Factor

A multibrand outlet is one where the consumer can compare features/prices
and also get a feedback from the store personnel on specific brands. Such a
retail store should be very careful in dealing with the consumer when he/she
asks for information on specific brands. It is not uncommon to find sales per-
sonnel in the store attempting to promote a specific brand or brands against
certain others. This traditional approach of “pushing” some brands may no
longer work in an environment where the consumer is more aware and has
sources of information other than from the store personnel. For instance,
when the consumer receives a negative feedback about a brand of washing
machine (at a retail outlet) and a positive WOM among his friends, he begins
to suspect the credibility of the store. The retailer's influence on the consumer
is still quite high in India (though the trend is declining in the metros), and
the opportunity provided by the situation should be used to build credibility
in the transaction.
Analyzing the need of the consumer is fundamental to building the cred-
ibility of the store. The clutter of brands, benefits and features may confuse
the consumer. Confounding the confusion is the advertisements that compare
brands on their features, quality, prices and so on. A consumer attempting to
upgrade to a feature-ridden color TV is very different from one who is entering
the store to replace a basic color TV. Pressurizing and selling a feature-ridden
color TV to the uninterested consumer can create post-purchase dissonance.
The consumer is likely to feel “cheated” about being sold a TV that he did not
want or one that is too complicated for his needs. Sales personnel may tend to
force a brand at a price point higher than the one the consumer wants to buy.
The “need–offer” match that takes place in the initial phase of “customer–point
of purchase” interaction is vital, especially for highly competitive products
(low and middle price range). This is because the major chunk of the market
exists in these ranges and the existence of most retail stores depends on these
markets.
Product–service interface at the point of purchase enhances the relation-
ship between the retailers and consumers, just as structured “in-store” and
“off-store” service enhances the customer–retailer interface.
Retail Loyalty
Loyalty being an important strategy for marketers, it is worth analyzing how
retailers retain consumers and ensure that they come back, after establishing
retail equity. With fragmented patterns of retail locations and a high degree of
area-wise concentration in urban cities, sustaining consumer loyalty is a major
challenge. Research, both in Indian and Western contexts across categories,
shows that loyal consumers significantly enhance profitability. Loyalty, here,
is essentially a consumer's commitment towards a retail outlet. This aspect
highlights the fact that for some reason, a consumer selects a store for repeat
buying in spite of the several alternatives available to him/her.
Point of Purchase Factors

Depending on the nature and size of the retail store, there may be different
approaches to enhance the base of loyal consumers. The following aspects
may provide a conceptual platform for retailers involved with point of pur-
chase consumers.
Importance of SKU Management

In products like soaps, toothpastes, blades, talcum powders, shampoos and
other packaged goods (FMCG), a high degree of branding is taking place. It is
not uncommon to find consumers asking for a specific brand in urban markets.
But brands like Parachute, Lifebuoy and Chik are strong even in rural markets.
The critical aspect to be noted at the point of purchase (even in a super mar-
ket) is the maintenance of the typical stock-keeping units (SKU) with regard
to each product category and brand. Based on previous purchase data, one can
find out what these SKUs are. An SKU is just a unit of the brand. For example,
there are sachets, 500 gm and 1 kg packages of Surf Excel. Each is an SKU. The
normal point-of-purchase strategies that may be often associated with loyalty
are service and price. SKUs may play an important role in deciding how a con-
sumer perceives a store. A consumer who is unable to get an SKU of his/her
choice at a store after frequenting the store a few times, may not want to return
to that store again. Availability of appropriate SKUs (according to the location,
product category or brand) is important for gaining store traffic—a prerequis-
ite for store loyalty. Does the same size of Ariel or Close-up or Red Label sell
uniformly in all areas in the city? How many times does a retailer run out of
stock with regard to a specific SKU? Such probing also helps a retailer to man-
age his/her inventory more profitably.
Price-based Loyalty
Price is one of the several factors that lead to repeat purchase. Any shopper
is aware of a couple of retailers in his/her neighborhood, who may be able to
offer packaged goods at a price less than the marked retail price (MRP). This is
one of the reasons why consumers stick to their neighborhood shops in spite
of the super markets in their vicinity. Such retailers bank heavily on business
volumes. But the catch is that “price-loyalty” may be a short-term strategy.
This is not to say that retailers must not take recourse to discount sales or a
reduced MRP. But they must have other plans to back up the “price-based”
strategy. The emergence of a big retailer who offers better prices because of
large volume can be a definite threat to a small retailer who uses the “price-
based” strategy. This is the reason why some kirana stores offer home delivery
during working hours even for small purchases.
Service and Profitability

While service is certainly an important factor in retaining consumers, its qual-
ity and the infrastructure at the point of purchase should be appropriate for
the consumer, apart from being profitable for the retailer. Quick and free home
delivery may be an attractive service for consumers. But as the retailer builds
up a consumer-base over a period of time, this service will become more per-
sonal, and hence would mean more overheads. This is one of the reasons why
large retailers specify a minimum purchase and distance limit for free home
delivery. Financial bottom-lines are extremely important when retailers plan
for an infrastructure – be it personnel, additional space or technology. Even
ambience can be a service, which enhances the shopping experience. The
costs of the retailer's AC, the store traffic, repeat purchases and the margin on
brands have to be taken into account. The store can have a significant part of
low margin–high volume products (like soaps, detergents, coffee, tea or gro-
ceries) or high margin–low volume products (like CDs, foreign publications or
furniture). Service provided by the store should not be allowed to offset prof-
itability, especially when it is attempting to build loyalty. It is virtually impos-
sible to wean away a loyal consumer from a service that he/she gets used to.
Triggering Retail Loyalty

It is not possible to have a customized strategy for each brand/retail store
without specific situation-based inputs. The following guidelines may be con-
sidered to come to grips with promoting brands at a retail store:
a. The identification of the target segment helps in the selection of brands/
product categories. Having done that, the store need not stock slow-
moving brands or variants. This also minimizes POP efforts. For example,
Connexions is a retail store that carries books, CDs, gifts and toys by tak-
ing into account the needs of consumers in a specific locality.
b. The store can identify fast-moving brands and plan promotional activi-
ties at the point of purchase. This will ensure that an optimal publicity is
worked out for these brands.
c. Brands on sale can be placed at a specific location in the store. This helps
the consumer plan his/her purchase of these brands and also compare
and contrast with the variants that are not on sale. Going around the
store, a consumer may find on sale a brand of juice and a brand of tea at
different locations. If many brands from many categories are on sale, the
consumer may miss seeing certain brands or run out of money by the
time he comes to the other “sale” locations in the store.
d. POP posters have to be displayed at different locations depending on
whether a brand is on sale or not. Categorizing “on-sale” brands also
helps the retailer to spread the POP material in the store. This helps
attract the attention of customers much better as it breaks the “adapta-
tion” process by which the latter get used to the POP plethora and end
up not looking at any such material at all.
e. POP brochures are best placed within the vicinity of the respective prod-
uct category. Placing brochures at the entrance of the store (or distributing
them) fails to identify consumers who may be interested in that product

category. If awareness is to be created on a new category/brand, it will
have to be done in synchronization with media planning.
f. A brand needs to advertise its promotional sale in local media vehicles
that are popular in the area where the store is located. This generates
awareness and selective use of POP material within the store can serve as
recall stimuli. POP planning is an elaborate and structured process, which
can improve the image of the retailer in the long run.
Retail loyalty may help retailers deal better with manufacturers, especially
when brand differentiation becomes small. Managing the experiences and
expectations of the target segment is a prerequisite for retail equity, which can
eventually lead to retail loyalty.
Customized Information Search—A Futuristic

Retailing Option
At a time when cyber-malls are being planned in India, it may be worthwhile
for marketers to be aware of futuristic distribution options in reaching consum-
ers. The following scenario may not be a far-fetched one after a few years.
A consumer is interested in ready-mades. He/she clicks the Internet –
answers the menu on the occasion which is associated with the wear – party,
casual, birthday, formal, etc. The consumer responds and gets a display that
about 500 items have been found. The menu offers him/her the option of
narrowing down the selection to about 25 items (restricted to the occasion
specified by the consumer). The consumer responds to further queries on
color, size, fit, etc. with options and the menu ends after ascertaining the
consumer's preferences on mode of payment (credit card details), time of
delivery, etc.
All this shopping (it may take a longer time for consumers to shop on the
Internet for durables) takes place with the consumer at home. “Interactive
Home Shopping” (IHS) could be an extremely useful retailing option for mar-
keters (Joseph Alba et al., 1997) It should be noted that in the example, the
retailing focus is on convenience and adoptions that takes away the specific
focus on brands. In order to achieve this, the retailer may have to stock/have
access to more brands and stock keeping units (SKU). Specific brands would
have to create their own equity on the Internet so that they enter into the con-
sideration set of consumers. Currently shelf space is at premium and retailers
prioritize brands for shelf space allocation (non-durables and durables). Con-
sumer options in terms of variety will become major retailing factors in Inter-
net shopping. This kind of IHS offers the following advantages for consumers.
1. IHS offers extensive product information at a time when the consumer
needs it, and the consumer may be able to create images that may reflect
his/her trial of the product.
2. IHS offers a very broad shopping option. It can focus on several brands
and the consumer can compare these brands both on functionality and
symbolic aspects.
3. IHS enables the consumer to have an in-depth assessment of the offering,
taking his/her own time, as compared with the limited time spent at the
retail outlet.
4. IHS could offer a memory for past selections and preferences on pur-
chases. The images can be shared with friends who will be able to com-
ment on the consumer's selection.
5. IHS could cover products and brands that may not be available to
consumers in local markets. These may include “new concept” or “new
to market” products.
A good product without a well known brand name has the possibility of
getting accepted without the hassles of going through the retailers in a clut-
tered market.
Interactive Home Shopping is a shopping channel that ensures ongoing,
two-way dialogue between the buyer and seller on current and potential shop-
ping transactions.
Information Search and IHS

Even in the case of durables, research has shown that a majority of consum-
ers do not indulge in extended search. They visit a few outlets before taking
a decision on the brand. This is possibly because, given the state of competi-
tion (too many brands and no significant difference across brands at least in
a specific price range), the benefits of additional search as the search process
extends seem to be incremental or insignificant. The consumer may reach a
point where the cost of the search exceeds the perceived benefits of the search.
A consumer in Chennai wanting to buy a color TV or a no-frost refrigerator
may visit a few outlets closer to his/her residence or visit an area, which he
perceives as the best shopping area. For this kind of purchase, IHS offers con-
sumers an opportunity to choose from several hundreds of alternatives (as
stated earlier, this is a futuristic orientation) as compared to a few in retail
shopping options. One aspect that should be noted in this context is that even
in IHS, consumers may have to sift through a plethora of information. How-
ever, advanced software provisions could create a menu-driven dialogue that
is likely to be useful, at least in a few product categories with which consum-
ers are familiar. These are product categories on which consumers may have
already formed their beliefs and expectations, and perhaps even the basis of
evaluating alternatives. A consumer who wants, for instance, a no-frill color
TV may be interested in a brand that has a reasonable set of features at a mod-
erate price. The consumer could look for the infrastructure of the company
to reassure himself of the after-sales aspects (not just the address but other
aspects of how the service is handled). For instance, he/she may want to know
the centers across the country as he may have to relocate himself frequently.
Hence, it is evident that in such product categories, consumers have a sub-set
specification in mind before they start the search process. IHS could provide
the right information under such circumstances.
In the example of readymade wear mentioned earlier, IHS could even be
used to rank the search in terms of fit, color, price, etc. The same approach
could be used for buying television sets through IHS. The preferences of the
consumer (sub-set specifications) are screened instantaneously, and the con-
sumer chooses from the outcome of the screening process. One more aspect is
that consumers, or even a cross-section of buyers, use memory for formulating
the consideration set. A consumer wanting to buy a TV may recall a couple of
advertisements of TV brands and focus on obtaining information only on these
brands. In such a memory-oriented search process, there is a possibility that
consumers may not remember some brands, or may make inadvertent wrong
assumptions during their memory recall of features, prices, etc. An IHS system
ensures a search, which is systematic, structural and comprehensive. Another
advantage of IHS is that consumers do not have to expand their time, efforts or
costs to get across to the sub-set specification. But for the IHS, they may have
had to visit several retail stores to get an idea about the brands that meet their
specifications, and even then the search may not be a comprehensive one. Dell
computers has an Internet site, which covers most aspects explained earlier
(http://dell.com). IHS could also have a provision for storing the list of items
a consumer regularly buys from a set of retailers.
Generation of Alternatives in IHS

Retail outlets play an important role in providing information to consumers
for decision making purposes. In a product category like washing machines,
there maybe several clarifications that consumers may need during the pro-
cess of comparing alternatives for the final purchase decision (tumble wash,
multi-program washes, etc.). A manufacturer could print brochures on specific
attributes/features highlighting the benefits. At the retail outlets, sales person-
nel could be trained to explain the various aspects to consumers. While both
these approaches have a number of advantages, the consumer may not have
the time, motivation or even the basic understanding to go through brochures.
The retail outlet assistance relies on a high degree of professionalization, train-
ing and motivation level of its sales personnel. There is also the need for the
company or the retailer to retain good, sensitive knowledgeable sales person-
nel who have been trained well with investment in training programs. IHS is
a super sales associate, as it does not have variation in motivational levels, the
problem of human memory, fatigue, etc. The information, once stored, is avail-
able with high consistency, and it can also be updated when the need arises.
IHS also scores over conventional retailing because of the quality of infor-
mation it is able to give, apart from the quantity of information mentioned
earlier. In the case of a large modern retail store that wants to make use of IHS,
products and services can be classified into
a. Search goods – products whose value to the consumer can be predicted

prior to purchase.
b. Experience goods – products whose value to consumers could be
assessed only after at least one use and,
c. Credence goods/services – whose quality may be difficult to judge or
evaluate even after consumers use them repeatedly.
While a number of examples could be considered across categories, it is
important to remember that consumers' perception on product categories or a
specific brand is conditioned by information that surrounds the product cat-
egories/brands. A consumer who purchases an enzyme-based detergent like
Surf Excel for the first time may fall within the category of “experience goods”
purchase. But the same customer may perceive it under the category of “search
goods” if he/she is able to predict the performance of the brand based on the
information given, and this is where IHS could play a marketing role by elevat-
ing the perception from “experience goods” to “search goods”. This will result in
a greater probability of the product of the brand being bought by the consumer.
A “credence” product may be something like a beauty and skin care (fairness,
etc.) product in which the consumer will have difficulty in judging the effect-
iveness or the value of the service even after repeat purchases (judging, here,
is in relative terms as compared to search or experience goods). An IHS could
provide customized information on the specific queries of the consumer with-
out getting into medical terminology, and encourage consumers to visit a parlor
or try the specific brands made by a company. Thus, IHS moves up the product
from “credence good” to “experience good”. As stated earlier, the compartmen-
talization may not be rigid, and differs from one product category to another,
and also from one target segment to another. The same beauty and skin-care
brands, when marketed through IHS to experienced users who may have been
using these products for decades, may categorize them under “search goods”.
This is only a conceptual approach and the same categorization may assume
complex proportions when services like psycho analysis are considered. In cer-
tain categories like clothes, for instance, there has to be a synergy between IHS
and the manufacturers involved. Color may be an important criteria for pur-
chase, and the actual colors of the clothes offered by the manufacturer should
reflect in the visual photographic reproduction used in IHS. If there is no syn-
ergy, dissatisfaction of the consumer may outweigh the advantages of IHS. In
certain “experience” goods category, IHS may even have provision for consum-
ers to convey experiential information, which could have an impact on sales. The
Internet shop Amazon (http://www.amazon.com) has a provision for consum-
ers to post their own reviews of books, and whenever there is a positive word of
mouth, it could influence sale. The very fact that consumers can access Amazon
for book reviews creates an enhanced image of Amazon among consumers. In
the role played by IHS on the conversion aspects from “experience” goods to
“search” goods, manufacturers also play a vital role. For instance, safety is an
important aspect in toys, and a brand which is able to consistently deliver this in
its offerings has the possibility of getting placed in the searched goods category
as consumers start associating the brand name with safety.
IHS and retail outlet – Commodity products

In commodity types of products (rice, sugar, cereals, etc.) involvement levels
have already been brought in by marketers through branding. The commodity
type of markets normally experience price competition, either from brands or
from local retailers. As price competition increases, consumers increasingly
become price-sensitive, and this ends up in a cycle. The intricate aspects of
price–quality association emphasized by some brands as a plane of differentia-
tion, appeal to niche consumers. IHS could provide quality information that
consumers may not be able to collect from retail outlets.
Planning an IHS system

IHS will involve substantial distribution costs that may have to be built into
products. This may not be very desirable, given the competitive context espe-
cially in mundane product categories, in spite of its advantages mentioned
earlier in such categories. A supermarket deals with commodities, fruits and
packaged brands in categories like soft drinks, biscuits, soaps, etc., apart from
packaged “search” items made by local establishments. Most of these cat-
egories are price-sensitive ones and if the target segment is middle or upper
middle class, distribution costs may have to be absorbed by the IHS provider
in spite of the economies of sale bargains that are obtained from vendors.
Hence, there may be a necessity for the IHS system to fix pre-requisites on
the sale value of the purchase made by the customer for the merchandise to
be delivered at home. Some kind of club membership also needs to be intro-
duced to ensure that IHS retains a base of consumers who would sustain their
shopping through IHS.
Mix of product to be carried on IHS

In order to have multiple item orders, IHS should ensure that complementary
assortments of products are purchased through vendors. There is a need to
plan what could constitute a complementary set of product-mix. For example,
there could be a cosmetic set consisting of products related to skin care; there
could be an apparel set in terms of choice of colors, types of dress material
which go together, appropriate ties, etc. This ensures that consumers get the
complete package, apart from providing enhanced volumes and margins to
the IHS system. Appropriate vendors could also be selected, and this provides
further certainty and consistency to the system.
Retailers, especially in urban cities where personal computers are find-
ing their way to homes, could monitor the adoption of Internet services and
decide on an IHS system at an appropriate time. However, marketers would
have to compare and contrast the IHS with the other conventional systems
of distribution before deciding on it. The viability of IHS has to be formu-
lated after taking into consideration several aspects of a specific market,
and hence a marketing research study is the starting point towards the IHS
approach.
Touch of Reality
Point of Consumption Is the “Point of
Decision Making”
According to Paco Underhill, guru of modern retailing and its impact on
consumer behaviour, 60–70% of the consumption in developing countries
are either influenced or made at the point of purchase in the retail outlets.
Several brands are likely to focus on point-of-purchase consumer behav-
iour, including variety and “in-store” experience of consumers. Store
image is likely to be a major driver and point of purchase aspects signifi-
cantly contribute to the image of retail outlets. Madura Coats plans to get
a significant portion of its revenues through its chain of exclusive outlets
(as against getting revenues from multi-brand outlets). Peter England's
people store is an example with about 10,000 stock keeping units (a prod-
uct variant with any size/color/design/flavor is a stock keeping unit).
Besides enhanced margins, exclusive outlets also offer the advantage
of being better poised for obtaining customer feedback on a number of
aspects that matter to customer experience at the point of purchase/con-
sumption.
Consumer Compulsivity in the Indian Modern

Retail Setting
Banwari Mittal, Morris Holbrook, Sharon Beatty, Priya Raghubir, and
Arch Woodside, opine that impulse behaviour of consumers consists of
several factors, being associated with the culture, the personality traits of
consumers and the need states of consumers.
They had identified a number of factors associated with these three
basic factors. Need for gratification, need for excitement (shopping
excitement), impulsiveness (consumer impulsivity), collectivism versus
individualism (of the specific culture), materialism and saving mentality
are the factors responsible for a consumer's impulsive behaviour.
This approach fits into the Indian retailing context as well. With large
modern outlets drawing the masses, consumer impulsivity seems to be
triggered on the following lines: Consumers get interested in discounts at
a large format like Reliance Mart, and seem to make purchases that they
have not planned for in the respective retail visit.
The excitement of making purchases advertised as the discounted
merchandise of the day adds to the compulsivity of consumers. India
being a dominant collectivist culture (meaning the need to conform to
group norms and practices over individuality), word of mouth spreads
fast about “excitement-oriented deals” in modern retail outlets. The

entertainment aspect of spending time in large outlets with good ambi-
ence also adds to the shopping excitement. Consumers feel gratified that
they have been able to save on the shopping trip, especially when some
of these savings are attributed to in-store purchases not planned earlier.
Hedonism as a Retail Experience

Modern retail format is growing at a considerable pace and malls and
shopping complexes have recognized the need to extend hedonistic
experiences to consumers. Ambience, layout, and spending time in plush
surroundings may have enabled retailers to extend the shopping vis-
its of consumers. The new dimension of the retail strategy is to explore
how leisure and entertainment can add value to the retail experience of
shoppers. Shopper's Stop has its own cafés, spas and book stores. Future
group is planning to open unisex salons, gaming centers and entertain-
ment centers for the family at its nine Big Bazaar outlets. Spencer's Retail
has set up live kitchens and book stores to make consumers spend more
time. Vishal Retail is also planning to start salons on its premises. Such
a strategy seems to be in tune with the gratification consumers get from
indulgences (this may also include compulsive behaviour with regard
to shopping). Research published in Harvard Business Review reflects
that consumers who may resist the temptations with regard to self-
indulgence may have a regret phase later in life. The research points out
to the fact that marketers may have to not only highlight the pleasures of
indulgences but also suggest the negative emotions the consumer may
go through for passing up an opportunity of indulgence. For example, a
mall/shopping complex may be able to suggest that a family not spend-
ing time in a mall is likely to feel bad about the forgone opportunity at a
later point in time when children grow up and leave home. Though the
research does not cover the retailing context, such an approach seems to
be applicable to the Indian retailing scenario.
References
Del Hawkins, Roger Best and Kenneth Coney (1998), Consumer Behaviour – Building Mar-
keting Strategy, McGraw Hill.
Jerry Wind and Vijay Mahajan (2001), Digital Marketing, John Wiley.
Joseph Alba, John Lynch, Barton Waitz, Chris Janiszewski, Pickard Lutz, Alan Sawyer and
Stacy Wood (1997), “Interactive Home Shopping, Consumer Retailer and Manufac-
turer. Incentives to Participate in Electronic Market Place”, Journal of Marketing.
Joseph Pine B. (1997), Mass Customisation: The New Frontier in Business Competition”, Irwin.
Philip Kotler (2000), Marketing Management–The Millennium edition, Prentice Hall of India.
Ramesh Kumar S. (2001), “Synergising Online and Offline Strategies”, Ivey Business Jour-
nal, Nov–Dec, Ivey Business School, Western Ontario, Canada.
Ramesh Kumar S. (2001), Managing Indian Brands – Concepts and Strategies, Vikas publications.
Rust, Roland T., Valarie A., Zeithmal and Katherine, Lemon, N. (2000), Customer Equity,
Free Press.
Theodore Levitt (1980), “Marketing Success through Differentiation—of Anything”, Jan–
Feb, Harvard Business Review.
12
The E-Mode of Brand

Positioning: The Need for an
Online Positioning Interface*
Brand positioning is crucial to any brand's strategy. Given the rapid de-
velopment of technology, changing lifestyles of consumers and active con-
sumer interaction, there may be a need for brands to synergize their efforts
to position themselves with online positioning strategies. This would enable
brands to adapt to an environment that is increasingly becoming digital. This
chapter, after taking into consideration the published literature on brand
positioning, attempts to formulate online positioning strategies based on the
various aspects of brand positioning such as price, customer interactivity,
and consumer community orientation. Implications for marketing managers
are provided.
Introduction
Brand positioning has become the cornerstone of marketing strategy in recent
times in fast-moving consumer product and durable categories, and services.
It would be difficult to think of a strategy for any brand without a well-thought-
out strategy for entering the consumer's psyche (Ries and Trout, 1987).
Thus, Nike's success could be attributed to the positioning that it is worn by
the world's best athletes, as reflected by the Michael Jordan campaign (Trout and
Rivkin, 1999). While the challenges concerned with positioning strategies still
remain with marketers, the environment has been changing with the influence of
* This chapter appears in “Contemporary Research in E-Marketing”, edited by Sandeep Krishnamurthy.

Copyright 2007, IGI Global, www.igi-global.com. Reprinted by permission of the publisher.
Web-based marketing. In the year which closed in September 1999, there was an
increase of 221.5% of goods that were traded over the Internet. Consumer goods
registered an increase of 665% over the same period (Wind and Mahajan, 2001).
The consumer is becoming more evolved in terms of information control.
He/she is no longer likely to receive information without the interactive com-
ponent being present, when involved in consumer decision making. Hence,
the traditional positioning strategies may not succeed as segments are becom-
ing smaller and less homogenous (Solomon, 2003). A number of established
brands have also started using the Internet and the Web to adapt to the chang-
ing environment. Some of the global brands making this transition include
Levi's, Dockers, and Barbie (Ries and Ries, 2000).
Even in a developing country such as India where less than five percent of
the total retail sales come from organized supermarkets/malls and the penetra-
tion of the Internet is miniscule, supermarkets such as Subiksha and FabMall
(www.fabmall.com) have started online marketing of groceries and consumer
goods. FabMall started as an online store in Bangalore with books and music,
and over time, has added several categories such as groceries, jewellery, and
gifts. It has since added physical retail stores around the city of Bangalore.
Today, its model attempts to synergize the advantages of retail outlets with
online dimensions. The physical retailing model of the company has grown
from a revenue of 4 million rupees to 15 million rupees per month between
April 2003 and November 2003 (Kumar and Mahadevan, 2003).
The trend of having multiple channels to reach the consumers could result
in building a good brand besides enhancing the profitability aspects. Subiksha
is a discount grocery store at Chennai (previously known as Madras), which
deals with low-priced groceries. The store has a network of outlets around
the city and has started online operations by which customers could order
groceries. The unique aspect of this store is that its network is located close to
residential neighborhoods and hence the delivery charges, which are normally
significant, are saved.
This integration of physical and online presence is commonly observed in
global brands. Charles Schwab transacts 80% of its business over the Internet
but has increased its off-line presence also as both channels would be required
to service its customers (Lindstorm, Peppers, and Rogers, 2001). Tesco, the
U.K.-based retail chain with 600 stores, 60,000 product-lines, and 10 million
customers who are members of a loyalty program has illustrated how the com-
bination of online and off-line retailing could develop a successful retail brand.
Amazon.com, with a customer base of 8.4 million and 66% of sales being con-
tributed by repeat purchasers, is a brand that has an association of custom-
izing products (books, music, etc.) to the needs of consumers by suggesting a
number of options that they may not have otherwise considered (Rust, Zeitha-
mal, and Lemon, 2000).
Given the rapid challenges in the marketing environment and consumer
lifestyles, and the growing influence of technology on consumer retailing and
marketing communications (e.g., advergaming and SMS messages), there
is a distinct need to explore new conceptual frameworks for the concept of
12  The E-Mode of Brand Positioning 323
positioning. There are two stages that would lead to the development of such
frameworks that could assist practitioners in a marketing environment. The
first stage is concerned with analyzing existing dimensions of brand position-
ing with a view to examine how they could be used for a brand that will have
both online and off-line retail channels. The next stage is to develop a frame-
work for categories of consumer products using the insights gained from the
first stage.
Different Dimensions of Brand Positioning

The challenge for marketers in India is not just to create an online experience:
there is a need to “move” the consumer from the traditional ways of buying to
the digital modes of purchase after understanding certain shopping aspects,
which are unique to the Indian context. While some of these aspects may in-
volve providing a kiosk in a traditional store for customers to browse and com-
pare the brands available under various categories, the most critical factor is
the manner in which such prospective buying experiences are communicated.
Given the Indian diversity with regard to demographics and psychograph-
ics, positioning challenges need to be market specific and product specific.
The second challenge is to ensure that positioning propositions of brands are
fulfilled, and this involves creation of the necessary infrastructure in a manner
that would bring in price differentiation.
There are various dimensions that could be used for positioning a brand.
Brand equity is a set of assets and liabilities linked to a brand, its name, or sym-
bol. Brand loyalty, brand name awareness, perceived quality, brand associa-
tions, and other brand assets such as patents and trademarks are some of the
components of brand equity (Aaker, 1991). Brand positioning involves devel-
oping, nurturing, and sustaining brand associations and brand imagery in
such a way that it offers a long-term competitive edge through the consistency
of such associations, which could be called sustainable competitive proposi-
tion (SCP) (Kumar, 2003). Hence, most components of brand equity could be
used to develop positioning strategies.
Loyalty as a Positioning Dimension

Amazon, com uses loyalty as a strong positioning strategy. It provides a
customer not just value in terms of the price of the merchandise. Rather, its
unique value comes from specific strategies such as recommendation of book
and music titles after capturing the customer's preferences on its database.
It found that customers who bought books also bought CDs and expanded
its productline to satisfy the base of loyal customers. It could be noted that
the interactive nature of online marketing was effectively made use of by
Amazon.com, and this enabled the company to sustain a dialogue with its
customers.
Peapod, an online grocery shopping store in the United States has sus-
tained the loyalty of its customers based on its “virtual supermarket” strategy.
Customers could access a list of categories, brands in the categories, and
decide on their purchases based on package size, unit price, or in some cases
even nutritional value. Customers can have standardized and special shop-
ping lists that could be used by them at any time. The customer retention rate
for Peapod is 80%. The retail outlet also uses the Internet to develop “learn-
ing relationships”, by which it could adapt itself to the needs of consumers
(Gilmore and Pine, 2000).
In both the Amazon.com and the Peapod case, the organization uses cus-
tomization and interaction with customers to gain loyalty and the outlets are
positioned on “value-based customization.” In contrast, in a typical brick-and-
mortar outlet the loyalty is built up in a different manner. Tesco has collected
massive data on its customers and divided them into 5000 needs segments.
It sends coupon assortments to various customers depending on their needs
and the redemption rate of these coupons is 90% (Kotler, 2003). From 1980 to
1993, the number of sales promotion coupons distributed tripled from 100 bil-
lion to 300 billion in the United States and the number of coupons redeemed
has only grown over only by about a third since 1981 (Hallberg, 1995).
Shoppers Stop in India, which has a considerable degree of loyalty, also
attempts to research the needs of consumers to formulate its loyalty programs.
Large offline retail outlets could develop loyalty-related positioning by ana-
lyzing the purchase data of consumers belonging to different segments. As
the number of consumers in these off-line retail formats is likely to be large,
“value-based loyalty” arises from the purchase patterns. FabMall uses recency
of purchase, frequency of purchase, and monetary value (RFM) to formulate
its loyalty programs. RFM could be useful both in off-line and online retailing
environment. It is possible for a multiple channel retailer (with both online
and off-line channels) to follow strategies that would enhance loyalty. In a
country such as India, where shopping for both fast-moving consumer goods
and durable categories such as television, music systems, and kitchen appli-
ances could be a ritual of entertainment, it is possible for a retailer to provide
information on the Web for a specific segment and attract retail traffic based on
this information (Kumar, 2002).
By this approach, while the information provided enables a consumer to
appraise the offerings of the company, the “touch and feel” factor—a major
prerequisite in the Indian shopping context—is also retained. This would be
possible only for a specific segment of a market (niche) as the penetration of
computers is low in India. The positioning of the brand is based on informa-
tion support as well as the retail service when the customer visits the retail
outlet. There has been a proliferation of brands in most categories and the
traditional positioning methods may not result in customer retention. In a low-
involvement category such as soap, consumers will have a tendency to try
many brands even if they express a dominant loyalty to one brand. In other
low-involvement categories such as antiseptic lotion or floor cleaning solu-
tion, penetration levels have to be enhanced, especially in developing markets.
In both these kinds of categories, there is a need to combine off-line and online
positioning strategies and hence a mass-based advertising approach, which
has been followed for decades, may not produce sustainable outcome in terms
of brand loyalty.
In the case of soaps, Indian brands continue to position themselves on fra-
grance, skin care, and prevention of bad odor while expanding on herbal offer-
ings. One Indian herbal soap brand, Ayush, claims in its advertisements that it
would kill 99% of seven types of bacteria. Pears, a well-known glycerin soap,
has launched the germ-shield variant. Another brand, Lifebuoy, with variants
is positioned as a family soap on the health platform and the brand has been in
the Indian context, for more than four decades. Liril, which was positioned on
the product's “waterfall” freshness with its lime ingredient, has not been doing
well in recent times because of highly competitive positioning strategies. All
the four brands mentioned above are from the same company, and except for
the herbal brand, the other brands have a distinctive identity of their own and
they have been nurtured for several decades by the company.
Given such a competitive situation, positioning has to go beyond the trad-
itional imagery created by advertisements and the blitz of mass media. It may
be worthwhile to follow the principle of combining the product benefit with
the life benefit (Buchhold & Wondemann, 2000) while the positioning strategy
is being formulated by brands in the competitive context. Incidentally, Life-
buoy was also positioned for several decades as a soap with a germ-killing
action, and targeted the rural segment characterized by a lower income and a
different type of lifestyle. In fact, using a Lifebuoy soap a few decades back in
the rural areas meant that the consumer has graduated to a branded offering
from several low-end regional substitutes. Pears is a high-priced soap that has
a small niche market and it has been positioned on long-term skin care. At the
outset there is a need to provide differentiation in terms of how the product
benefit of brands is relevant to the respective segment, and even to segment
the market combining life benefit with the product benefit. The product bene-
fit of a herbal brand such as Ayush (killing of bacteria) may be relevant to a
target segment that is exposed to a dusty and polluted environment in a devel-
oping country such as India. Children and several thousands of middle-class
consumers travelling by crowded buses can be the target segment. The life
benefit for this target segment is to stay fresh in spite of being exposed to dust
and dirt. Lifebuoy, which is currently positioned to the urban target segment
as a “family soap” on the health platform (rather than on its original germ-
killing proposition) could retain the same demographic segment and present
the same life benefit of staying fresh to consumers who are exposed to a less
dusty environment – probably self-employed business people who do not
travel to work – similar to the target segment for Ayush.
The Internet enters into the mix as an information channel. It could pro-
vide information on the various brands, the various life benefits, the context
(user situation) in which the brand could offer the maximum benefit and
the ingredients used by each brand. From this approach, it is apparent that
there is a very clear differentiation not only in terms of benefits offered by
the brands but also in terms of usage situation, which is a very strong cri-
terion to segment consumers. Consumers would be able to appreciate how
they are made to select the offering closest to their needs (not just in terms
of fragrance or odor prevention, which is very generic). This would make
them buy the brand more frequently as there is a strong rationale to buy the
specific brand (than just trying a few brands as more of a variety seeking
behaviour). The problem of low penetration of the Internet in India (and
hence the information) could be addressed at important retail outlets and
consumers could be educated by the company at these outlets with the help
of digital kiosks.
Shiseido, a Japanese cosmetic brand, has outlets where consumers could
simulate several color combinations to suit their skin/desired aesthetic
appeal, and if they wish, they could leave their details in the database (Johans-
son & Nonka, 1996). In the category of soaps, consumers could take a look at
the kinds of ingredients and their benefits based on life benefit for an appro-
priate segment. With the database, the company could obtain feedback on the
effectiveness of the claims of the brand used by the consumers. This method
of contemporary positioning even for a low-involvement product category
could enable a brand to build up a better relationship with the consumer base
than by just satisfying the positioning function of differentiating the offering
from its competitors. Customer lifetime value has to consider the duration
of loyalty and the profitability of customers during this duration. (Reinartz,
Thomas, and Kumar, 2003). In any given category the duration of loyalty is
critical, and the contemporary positioning suggested is likely to result in a
longer duration of loyalty. Besides, if the company has several brands across
a price spectrum, the duration of loyalty could also enable the consumer to
graduate to updated offerings. One of the reasons for customer migration is
that the consumer does not find a broad spectrum of offerings with the com-
pany that the consumer could adapt to based on his/her changing lifestyle
(Coyles and Gokey, 2002).
Positioning Framework-I
The following framework (Figure 12.1) uses two parameters – price and inter-
activity with consumers – to provide guidelines for marketers to position their
products on the dimension of loyalty.
The framework has four dimensions from which a brand can choose to
employ its online and off-line positioning strategies depending on the selec-
tion of target segment for the brand. This framework would also be useful to
develop specific “loyalty associations” through appropriate reward systems,
as applicable to the respective segment. Needs should be integrated with the
framework more systematically. For example, low price–low interactivity cus-
tomers (LEAD consumers as a target segment) would clearly understand that
they would not be in a position to get rewards on loyalty as they are a part of
the bargaining segment, which is only price-conscious.
Customer Interactivity
Low High
PLATINUM
High GOLD
Price
Low LEAD SILVER
Figure 12.1  Price-customer Interactivity Linkages
The understanding comes from the positioning signal provided by the

company's reward system for retaining customers. Such type of positioning is
not possible through traditional ways.
For a brand that wants to consider high price–high customer interactivity
(PLATINUM consumers as a target segment), the company should customize
its product (even a tea brand could do this) to the consumer based on the finer
needs of the consumer, and the Internet-based interactivity could be used for
changes in customization whenever it is required by him/her. For example, a
brand of glycerin soap may customize such an offering based on the constant
feedback received on usage, changing climatic conditions, and the customer's
skin-specific reaction to the brand. The high-end customer getting involved
in this interaction with the brand also perceives a value for the price he/she
is paying, and is aware that the price-conscious consumer is clearly differenti-
ated by the brand. The Internet could throw up several customization options
and give the customer specific guidelines on product usage after ascertaining
feedback on brand performance with the inclusion of inputs from a derma-
tologist. A new variant of the soap could be initially introduced exclusively for
a loyal base of consumers belonging to this segment, and this adds exclusivity
to the value positioning.
High price-low customer interactivity (GOLD segment of consumers) could
find application in hedonic products such as coffee, tea, and perfumes. While
the interactivity may not be much on product performance, the inputs may be
associated with trends or recipes and customer information on new offerings
may be required. This type of interaction would be helpful to build a relation-
ship with customers by emphasizing the superiority of the offering, taking into
consideration the category and competition together. An interesting example
could be provided from the ready-made apparel industry, which has a num-
ber of brands generally positioned on lifestyle aspects. The brand Van Heusen
has brought in a fabric which reduces the temperature of the wearer. Another
brand, Louis Philippe, has introduced a shirt which is called “Permpress”
(it offers a fabric that remains permanently pressed because of a specific
technology). Even diapers, which have a very low penetration in the Indian
market, could be a category that involves high price–low customer interactivity.
These categories could reach out to the consumer on the net with information
on the state of the artwork in the category and how such critical applications
are treated with technology to deliver the relevant benefits to consumers. This
approach would also add credibility to the brand. Product development efforts
could also be highlighted and if the brand is able to get a testimonial from the
scientific community on the credibility of claims, they could be discussed on
the Web. Providing consumption-related services could be another dimension
that may be appropriate to this segment. For example, a new user of baby foods
may be interested in clarifying a few doubts about the usage and the Web is a
very effective venue for providing a service of this kind.
Low price-high customer interactivity (SILVER segment of consumers)
may not be a very feasible option for the company as costs of maintaining a
system of this kind may offset the profits. However, there are a few aspects
that could be considered for this segment. While individual consumer-specific
information may not be a distinctive possibility, there could be a Web page
that addresses the common concerns of consumers regarding the product.
The brand offering this service would have to be priced slightly higher than the
one in low price-low customer interactivity. If a company offers several sham-
poo brands, the mid-priced brand could have some customer interactivity if
not high interactivity. On the Web site, the brand could answer a few questions
on hair care, and the buyer of the brand could be given a password with which
he/she could get three specific questions of his/her choice answered. SILVER
target segment of consumers offer the possibility of a future potential in terms
of interactivity as well as prices, and hence could eventually be moved to other
segments. The four aspects of loyalty positioning could be useful in a variety
of product/market situations and each aspect conveys a distinct positioning
that is likely to enhance customer loyalty in the appropriate segment.
Positioning Framework-II
There are two dimensions of positioning strategies, namely, perceived quality
and associations that have been successful in the marketing history in both de-
veloped and developing markets. It would be useful for marketers to consider
them while attempting the positioning synergy suggested in this article. These
dimensions are portrayed in the backdrop of specific situations/contexts that
reflect the realities of Indian markets. The contextual aspects are given in such
a way that the positioning strategies suggested would be one of the primary
components of a brand's marketing approach.
1. Perceived Quality as a Positioning Dimension

Perceived quality has three aspects—objective quality based on the perform-
ance of the brand in the intended direction, manufacturing quality in terms of
how defect-free the brand is, and product-based quality, which is associated
with features, parts/ingredients, and services offered by the brand (Aaker,
1991). Perceived quality is the psychological because it involves consumers'
perception of how the brand addresses their needs. The expectations of the
target segment are crucial in assessing perceived quality. There may be two
kinds of televisions: one an upscale plasma version and the other an entry-
level model. Both of these versions are targeted towards different segments.
The higher-end consumer would expect specific quality and state-of-the-art
features that would add a symbolic appeal to the television (which is normally
kept in the visitors' hall in a typical Indian household) and effective after-sale
service when there is a need for it. The expectations of the lower-end customer
would be limited to the utilitarian and functional aspects of the television, and
hence perceived quality would be different for these two segments.
Perceived quality is used by the consumer in his/her decision making.
A customer who is convinced of the perceived quality of a car would select
the brand from among several alternatives. This aspect is especially applicable
for a premium-priced brand. There are several car brands competing at the
higher-end of the market. While off-line strategies would be associated with
conventional advertising support, online promotion could be done through the
Internet, highlighting certain aspects that could not be done in an advertisement.
For example, the engineering excellence in terms of safety or comfort could be
conveyed through a special effect film shown to the prospective customer after
assessing his/her needs. The preferences of the individual customers could vary
and several dimensions associated with the brand could be shown in accord-
ance with the preferences of each individual prospective consumer. Perceived
quality of an offering could also be enhanced by the services offered. OnStar is a
service offered by General Motors and several million consumers have availed
this service. The service ranges from remotely opening the door of a car (when
the consumer loses the key) to tracking the car when it is stolen (Prahalad and
Ramaswamy Venkat, 2004). The very positioning of such a brand triggers a super-
ior quality of customer support beyond the mundane after-sale service offered
by car makers. Retail outlets of such brands could demonstrate such instances
through simulations when consumers visit the outlets to learn more about the
brand. The Internet could also be used in carrying the experience of consumers
who have used the features of a brand (as testimonials). Prospective consumers
are thus encouraged to have a dialog with consumers who have experienced
the brand. Such word-of-mouth references on reliability (which could be spread
quickly on the Web/e-mail to a variety of consumers) could enhance the per-
ceived quality of the brand, as reliability is one of the factors affecting product
quality. Other aspects of product quality such as serviceability, finish (look and
feel of the product), features, and durability (Garvin, 1984) could also be dealt
with on the Web. Besides customers, experts from specific fields of engineer-
ing could offer an impartial assessment of the brand and its competitors. If the
brand offers a product that is superior to that of the competitors, this approach
of using experts to compare brands would be more effective than a company-
sponsored comparison based on advertisements in which several competing
brands are compared on a number of factors. The brand could also showcase
the internal systems in the organization, which assure quality on several aspects
of the brand. There are also extrinsic cues that could influence perceived qual-
ity of the brand (Schiffman and Kanuk, 2002). The brand and its advertising are
extrinsic cues that could influence perceived quality. A brand such as Sony can
mention on its Web site the various high-tech experiments it had carried out to
enhance its entertainment products. Consumers may not understand the tech-
nology involved but are likely to perceive the products of the brand as high in
quality. The digital media, in combination with such information, creates a qual-
ity perception among consumers because these elements of advertising enter
the consumers' awareness as technology portrayed online; and this is used as a
metaphor for quality of the product (Zaltman, 2003).
2. Associations as Positioning Dimensions

A number of dimensions of brand associations could be nurtured for position-
ing purposes. Prominent among them are product attributes, customer ben-
efits, lifestyle associations, celebrity associations, and user imagery. Product
attribute association is concerned with the association of a specific character-
istic of the brand with its positioning. For example, Volvo is associated with
safety and Mercedes is associated with its engineering excellence. In the digital
context digitizability would be the extent to which the existing functional at-
tribute could be converted into information-based functionality (Wind and
Mahajan, 2001). This offers interesting possibilities for e-positioning of brands.
National Semiconductor offers a simulation program on its Web site which
would enable engineers to plug in their own parameters to experiment with
their designs. Over 500,000 engineers keep coming back to Cisco's Web site
(Seybold and Marshak, 2000).
A similar kind of positioning (digitizable positioning) is possible in con-
sumer product categories also. Tide, the brand of detergent, has a Web site
in which consumers can find information on removal of various kinds of
stains. Amazon.com offers consumers several kinds of information that would
enable them to consider several alternatives revolving around their prefer-
ences. E-positioning of brands extend the conventional positioning to offer a
whole customer experience, which spans the entire decision making stages of
the consumer's selection process from pre-purchase to post-purchase (Bloch,
1995). The lifestyle positioning associated with a number of consumer cat-
egories could effectively use e-positioning to be in line with the changing
environment.
Consumer community is a concept that is evolving rapidly with the online
marketing context. Cyberspace offers several innovative types of position-
ing. Forrester Research estimates that in the year 2000–400,000 communities
existed on the Internet (Solomon, 2002). Gartner opines that by 2005, 50 per-
cent of all Fortune 1000 companies will launch virtual communities linked
to their Web site (Zetlin and Pfleging, 2001). Sony's www.station.com has mil-
lions of users who participate in computer gaming online. Toyota has a digital
racing game called Tundra, and as the popularity of graming has been increas-
ing, marketers are merging advertisements that are interactive and they are
placed with online games. This kind of technique is known as advergaming
(Solomon, 2003). Ninety-four percent of British youth have mobile phones
(Dana, 2001), and Nestle held an innovative contest for its brand Kit Kat,
which involved mobile phones. Off-line lifestyle positioning, high-tech gad-
gets as status symbols and cyberspace meeting spaces with an evolving youth
population offer several online positioning strategies that could be used in
synchronization with lifestyle brand associations. The concept of consumer
mind-set (Gollwitzer, 1986) distinctively divides the consumer mind-set into
two categories—goal-oriented and experiential. The goal-oriented mind-set
may be focused on feature-based information, whereas the experiential mind-
set may be directed toward hedonic or sensual pleasure and this aspect could
be used in the online positioning of brands, with contests and games being a
trigger to make the hedonic mind-set more involved in sensual pleasure. Over
time, a brand could build a community of users who would be able to display
brand passion, as in the case of Harley-Davidson.
Celebrity associations have been increasingly used in the recent times
both globally and in India. Pepsi, Coke, Nerolac Paints, Cadbury's, Perk
(chocolates), and Dabur's over-the-counter medication in consumables,
Palio and Santro in passenger cars, Victor two-wheelers (motorcycles), Sam-
sung (washing machines), and Sahara (airlines) are some of the categories
in which celebrities have been used in the Indian context. Santro was a car
introduced by Hyundai a few years ago and the brand has crossed 100,000
cars in terms of sales in 2003–2004, in a total passenger car market of one
million. Santro was literally an unknown brand and also had a “tall boy”
design unknown to Indian consumers. The brand initially used a topical
male celebrity to create awareness about the brand and later after the brand
picked up in terms of sales, it introduced a topical female celebrity and posi-
tioned the brand as “sunshine” brand with the imagery of the advertisement
indicating a clear lifestyle positioning. The buyers of the brand are urban
young adults who are upwardly mobile in terms of aspirations, income,
and status. The celebrity positioning was strengthened (by the inclusion of
the second celebrity) after the product was accepted for its functional fea-
tures such as design, performance and comfort. It is surprising that even in
such celebrity-oriented advertising, very rarely brands use online position-
ing to “connect” with the target segment, especially in durable categories.
An online consumer chat session with the celebrities starring in the brand's
advertisement (e.g., in Santro's) on the functional features of the car and the
celebrities' experience with the car brand would have added fun and charis-
matic credibility to the campaign. Fanta, the orange-flavored soft drink from
Coca-Cola, uses celebrities in its television commercials, and the script and
the visual revolve around humor. An online session with consumers aimed
at connecting the humor theme and the brand would have added excitement
to the brand, and in the soft drink category, excitement is a useful position-
ing. In durable categories, an expert could also be roped in with the celebrity
to provide a commentary on brand benefits and an online program could be

made available on the brand's Web site for consumers to access at any time.
A chat among the registered consumers as a rub-off strategy could also
open up the possibilities of a community of brand users being formed. User
imagery is another positioning dimension that is very useful in a competi-
tive environment full of communication clutter. User imagery is very useful
because the viewers of the advertisement using the imagery would be able to
readily figure out the typical user depicted by the brand. This is very import-
ant, especially because there are several brands vying for the attention of the
consumer. Fastrack is a brand of watch targeting youngsters in urban markets
and the advertising imagery shows the watch alongside a can of soft drink/
beer (as the can's image is perceived by the consumer in India) indicating that
it is clearly positioned toward youth who belong to the “cola/beer” culture
and the imagery speaks volumes about the lifestyle association of the brand.
Johnson & Johnson clearly carries the images of children when its products
are advertised. Imagery for an edible oil brand would be different because the
focus is more on the product than on typical user imagery. Online position-
ing could carry complementary imagery (complementing the print/television
advertisement imagery) to create an “experience.” A chocolate drink aimed
at youth could carry several innovative imagery visuals linking the typical
drinker of the brand and the pleasure of the drinker in having consumed the
brand. Experiential marketing, which involves several sense organs (Schmitt,
1999), could be used by a brand with its graphics on the Web. A high-end shav-
ing razor, which claims several technological points toward providing con-
sumer benefits, could create a product imagery on the Web (supplementing
the user imagery in off-line advertising), vividly portraying the finer aspects
of the razor with the linked up benefits. Online advertising imagery as an
extrinsic cue concerned with the brand could provide a significant enhance-
ment of the intention to try the product in the case of consumables and could
offer an enhanced image for durable categories. Such imagery could also pro-
vide information on product usage, whether it is a recipe for a new fast food
or instructions for the first-time user of a fully automatic washing machine.
A consumer may buy a vacuum cleaner but may not know how to use it.
Company-based off-line assistance is “time bound” in this case, and an online
format would be helpful to the consumer at any time he/she wants it. Time
styles of consumers differ depending on their personality (Cotte, Ratneshwar
and Glen Mick, 2003). Hence, online communication could take into consider-
ation several types of consumer personality. Given the variety of associations
and the contexts in which they could be put to use, marketers can use two
dimensions, namely, attribute orientation and online customer community
orientation, to choose a strategy best suited to their product/market situation.
Each of these dimensions can be of “high” or “low” magnitude with regard to
the product/market situation, thus creating four segments (there is a need to
develop an appropriate research methodology for achieving this framework).
Positioning Framework-III
Given the fact that almost half the population in the Indian subcontinent
is below the age of 25, the youth segment is an attractive one for several
fast-moving consumer good categories. Changing lifestyles, diffusion of
digital products and the emergence of neo-youth segments such as soft-
ware professionals offer tremendous scope for synergizing off-line and
online positioning strategies with a focus on “community orientation.”
A 2 × 2 matrix with functional attribute orientation and consumer commu-
nity orientation with “high” and “low” magnitude can be used as another
framework (an appropriate methodology has to be developed for these kinds
of orientation).
A brand could have a high attribute orientation and a high community
orientation. Brands that have been launched on lifestyle to build themselves
over the years, but which are required to enhance their attributes due to
intense competition, could follow this approach. Close-up is a brand of tooth-
paste that was launched in the mid-1970s in India with the lifestyle appeal of
“Close-up smile” and featured a boy and girl with romantic overtones. Over
the years, the brand has followed the same positioning slant and has been tar-
geting the youth. With competitive brands following the same approach and
brands from several other categories following similar positioning the brand
seems to have lost its positioning luster. The brand could be revitalized by an
online contest that emphasizes the functional attributes of the product.
A brand having a low attribute orientation could have a high community
orientation. Brands faced with low levels of product differentiation could
develop a community of brand users in a sustained manner. Mountain Dew's
positioning which involves a group of youth, is in tune with the online com-
munity orientation.
Low online community orientation with high attribute orientation could
be applied to brands in any category, which is highly innovative and sustains
a product-line that addresses changing customer needs. While community
orientation could help any brand to build itself, in a country such as India
where mass markets rule volumes, a durable category brand like Haier (the
Chinese brand which has entered India) may want to address the mid-market
and develop a strong product attribute association with thousands of consum-
ers who may not have personal access to computers.
Low attribute orientation and low online consumer community orientation
would be suitable to a number of no-frill brands at the lower end of the market,
which compete with unorganized offerings (offerings that are marketed at the
local market and ones that may or may not be marketed in a systematic man-
ner, or the offerings that may not have completed the legalities required for
marketing them). Electrical appliances, watches, and footwear in the Indian
market are examples of such product categories.
Other Topical Dimensions/Issues in Positioning

Points of difference associations (PODs) are strong, favorable, and unique
brand associations for a brand and they may involve performance attributes or
imagery that is unique to the brand (Keller, 2003). The various combinations of
off-line and online positioning strategies could establish an appropriate POD
for a brand in a given competitive context.
Another aspect advocated by Keller was the points of parity associ-
ation (POPs), which deals with category parity associations and competi-
tive parity associations. Category parity association refers to the extent to
which a brand matches what consumers expect in a specific category. Com-
petitive parity association refers to the extent to which a brand's associ-
ation matches that of its competitive brand's association with regard to
its strengths. For example, if a new brand of car is launched in the mar-
ket, competitive POP refers, for instance, to the state-of-the-art features
of the brand that match those of an existing competitive brand. The advan-
tage of combining off-line positioning and online positioning is that in off-
line positioning involving television or print advertisements, the perform-
ance attributes (of a detergent brand, for example) could be highlighted
and POP could be established. Online positioning of the brand (like that
of Tide's) could establish the POD with suggestions on how the detergent
brand could be used for various types of clothes, or on how stains could be
removed. Positioning could also involve linking attributes and benefits of
the brand with the values that may be relevant to the target segment to which
the brand is positioned. This concept is known as laddering (Reynolds and
Gutman, 1988).
Marketing Implications: Creating a Synergy

Between Off-Line and Online Positioning
Brands could be categorized as functional brands, symbolic brands, and he-
donic brands from the viewpoint of brand positioning and this categorization
is aimed at managing brand meaning over a brand's life cycle (Park, Jaworski,
and Maclnnis, 1996). This is a very useful concept for brand positioning, as it
builds up a brand with a clear focus, even when it attempts diversification.
When a brand has a strong functional appeal in terms of attributes and ben-
efits, and if the company is able to sustain a product-line with several offerings
of the brand (over a period of time), it can choose both online and off-line pos-
itioning strategies.
Hero Honda is a two-wheeler company that entered the Indian market in
the mid-1980s, and for almost two decades it has focused on functional attri-
butes/benefits with regard to all its offerings, namely Hero Honda CD 100,
Hero Honda SS, Hero Honda Splendor, and Hero Honda Passion. The last
two offerings have had a symbolic positioning but even such symbolism has
been highlighted with additional features of the bike. While the brand has
a clear focus on attributes, symbolism has been added based on innovative
features. Hero Honda could have an online positioning that illustrates the
processes within the factory on quality control, the rigor with which mater-
ial is sourced from suppliers, and quality control system that is followed,
to emphasize the efforts the company is making to provide the attributes
that consumers receive. The brand could also convey the developmental
efforts being taken by the company to enhance customer-friendly features.
This kind of secondary online positioning could build up credibility for the
brand, as consumers would also spread this information through word of
mouth.
Framework for Synergising Online and

Off-line Strategies
Given below, is a framework for integrating online and off-line strategies for
marketing both FMCG and durable products (Figure 12.2). The framework
also delves into the various stages of decision making involved in both off-line
and online strategies.
The framework consists of four quadrants based on two parameters—type
of product and type of buyers of the product.
In the figure brand-tasters are consumers who are either new to FMCG
(fast-moving consumer goods) categories, or they are trying out the brand
for the first time. In the Indian context, consumers who are new to the cat-
egory have graduated from a non-branded product to a branded one (deter-
gents, toothpastes, shampoos are categories where “entry-level” brands
may be required). Aims in toothpastes, Wheel in detergents and Clinic Plus
in shampoos are examples. Brand-building is attempted through “entry-
level“pricing (penetration pricing) along with high-visibility campaigns in
the mass media (as the offerings target mass markets). Need, information
Life
Durables Hopefuls
consumers
Type of
product
Brand
FMCG Brand ID
tasters
New Loyal
Type of consumers
Figure 12.2  Synergising Off-line and Online Strategies

search, evaluation of alternatives, purchase and post-purchase are the vari-

ous stages in consumer decision making. Consumers who are upgrading are
in the “purchase” stage of decision making. They are familiar with the prod-
uct category. Hence, the pricing and promotional strategies can propel these
consumers to try the brand. Free sampling can also be attempted by market-
ers to enhance trials. A high degree of sales promotion (freebies) is likely to
dilute the image of the brand.
In the case of online marketing for such consumers, the marketer should
focus on premium brands. Consumers owning computers, for example, are not
likely to be in the entry level stage. The focus should be on building and rein-
forcing the brand personality. For example, a Web site reinforcing the brand
personality of a brand like Close-up (young, extroverted, outdoor-oriented
and modern) is likely to appeal to the “new” consumer who is attempting to
switch to the brand in the product category. The marketer should constantly
attempt to introduce brands that will offer significant perceived differentiation
to these “new” consumers. Dove moisturiser bar (soap) is an example. A Web
site can detail the benefits of the “state-of-the-art” ingredients such brands use
(soaps, detergents or shampoos). The site should encourage consumer queries
on the new offerings. It is also a good idea to provide information on the types
of problems associated with the product category. Stain removal (for a deter-
gent company like P&G) or problems related to baby foods/baby health (for
a company like Nestle) are specific areas for addressing, which can provide
in-depth information to a consumer who is in the “evaluation of alternatives”
stage. These consumers will buy a premium brand (unlike the entry-level con-
sumers) if they are convinced about the credibility of the brand. Online mar-
keting can build brand credibility by providing insights about the problems
associated with a category and offering solutions to these problems through
the brand.
“Brand-ID”, in the figure, represents a set of loyal consumers who
identify themselves with the brand. Though these consumers can be cat-
egorized as “loyal”, loyalty can be partly divided. Some consumers, for
instance, may be trying out different brands of soaps but may buy a specific
brand with greater frequency. Off-line strategies would include segment-
ing these loyal consumers through retail outlets (by appropriate methods
of monitoring their purchases) and offering them points, which they can
redeem against a company's products. Launching a new offering with the
associated online information to create awareness on various aspects (sug-
gested for the category of brand-tasters) is also applicable here because
these consumers may become “new” consumers of a competitive brand
if such strategies are not formulated. Event marketing among the target
segment can also generate and sustain interest and excitement around the
brand. The event has to be in tune with the personality of the brand. For
example, Coke can organize a game/contest, which the target segment per-
ceives as “fun and refreshing”. A brand of fast food can organize a contest
on innovative recipes to reinforce its perception as a brand that stands for
good taste, variety and creativity. Children can also be part of the contest to
enhance the “togetherness and family” image.
“Hopefuls”, in the figure, represent consumers who are trying out a new
brand of a durable product (TV, refrigerator or washing machine). This seg-
ment can also consist of consumers who are entering a product category for the
first time and, hence, they may choose a brand or (model) with an “entry-level”
price. A good word of mouth can be an effective online strategy if a brand can
build off-line credibility. The latter involves offering a good value in the prod-
uct itself, (being a high-involvement product) good after sales service and a
good rapport built by the retailer. A satisfied customer (post purchase stage
in decision making) may like to buy other products of the company, perhaps
from the same retailer as the one from whom he/she bought the brand to begin
with. Once a brand builds credibility, it can use its equity in online marketing.
This can be done by organising a “chat session” among the satisfied users, in
which the brand can project the good track record of the company (with regard
to service) and encourage the consumer to take a look at the brand at the near-
est retail outlet. Depending on the demand in an area, the consumer may also
be given small incentives. This is an attempt to push the brand into the “choice
set” of the consumer, who may still be evaluating a set of brands before buying
a high-value durable product. Online strategies should be pursued along with
off-line strategies like advertising and demonstration at specific outlets. It is
important to ensure that the “hopefuls” feel they have made the right choice
after buying the brand. This can be done by visiting the customers after a spe-
cific duration. This eliminates dissonance in the consumers' minds.
“Life consumers”, in the figure, are likely to buy the brand again in a
certain category and also buy other products of the brand. The repeat pur-
chase may also involve buying an updated version of the offering (with more
features/benefits). Online strategies include developing a database of con-
sumers (with demographics and psychographics that give information of the
lifestyle of these consumers), identifying specific segments that reflect a readi-
ness for a repeat buy or for buying another (durable) product. A consumer
who has bought an Electrolux refrigerator may like to later buy a washing
machine. The onus is on Electrolux to market its brand of washing machine to
this consumer. The strategies also include offering a specific “value deal” to
the consumer. This “value deal” can be made in terms of price, after-sales ser-
vice contract or even certain privileges across the product/service categories
depending on the lifestyle of a specific consumer segment. For example, if
some consumers travel frequently by air, the brand can tie up with an air-
lines and offer special privileges to this segment. Readymade wear, hotels
and theme parks are other categories that can get associated with the “value
deal”. Internet helps the brand to constantly stay in touch with its buyers
and elicit information at various stages of the relationship. Online newslet-
ters, product updates, timely offers based on readiness and online commu-
nity building are some vehicles to do so. Users of the brand can form a club,
as in the case of Harley-Davidson bikes. This emotional feeling can help
the brand forge a relationship with its consumers. Referrals can also be an
outcome of such strong relationships. The framework discussed above pro-
vides a set of suggestive, not exhaustive, strategies. Marketers may use the
framework, along with marketing mix elements, to formulate a combination
of strategies.
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13
Concepts of Customer
Satisfaction, Loyalty and
Relationship Management
Satisfaction has been defined in a number of ways. It has been defined as the
evaluation of emotion by Hunt. Satisfaction is an outcome of how well the
offering (brand) has met the expectations of the consumer in terms of “Value”.
This aspect of value can be functional utility, symbolism, service levels, experi-
ential features, or a combination of several of these aspects to fulfill an unmet
need. Dissatisfaction occurs when there is a discrepancy between prior expect-
ation and actual performance. Expectations (about a product/service) are “pre-
consumption beliefs about overall performance”. Expectations may be created
by advertising, information at the retail outlet, word of other consumers or by
prior experience with similar products or services. For example, a consumer
expects reliability, value and customer-friendly features when he/she buys a
brand like Sony. Performance determines whether the expected outcome has
been delivered by the product/service. Performance can be objective (actual
performance) or subjective (based on the feelings of consumers, which can
vary). The objective performance of a two-wheeler can be measured, say in
terms of mileage, cost of repair and how well it accelerates. Its subjective per-
formance can be judged by the user's feelings (how good he/she feels) about
the vehicle. It is interesting to note that disconfirmation is often an outcome of
subjective rather than objective performance. This reinforces the importance of
brand personality/symbolic associations of a brand. If performance is better
than expected, positive disconfirmation (satisfaction) takes place, according to
Howard and Sheth. If it is lower than expected, negative disconfirmation or
dissatisfaction takes place. Negative disconfirmation will take place if a bank
triggers excessive expectations about its service and does not live up to them.
Expectations can create a positive and enduring feeling as well, especially for
brands that are strongly entrenched in the market. When Coke conducted
“blind-taste” tests (before it launched New Coke), it obtained favorable results

for the launch. But the equity (and hence, the perception) of (old) Coke was
so strong that consumers refused to accept New Coke when it was launched.
Marketers have to conform to these expectations (subjective or objective).
A premium brand of readymade garments cannot afford to introduce poor-
quality fabrics (objective). The expectations created by a brand have an impact
on the level of consumer satisfaction. A brand of colour TV introduced during
the eighties claimed to be a 3-D TV! Over-promising on the USP is a definite
way to create unrealistic expectations, and will lead to dissatisfaction with the
respective brand.
How Consumers Learn from Experience

Consumers acquire information when they experience products and services.
The following example illustrates the process of learning from experience, as
suggested by Hoyar and MacInnis:
Motivation Four-stroke scooters are fuel efficient—
motivation to buy the brand
Prior familiarity Four-stroke motorcycles have been very
effective. The brand introducing four-stroke
scooters is a reputed one in the category
Generation of hypothesis The brand must be good
Exposure to evidence Disconfirmation—positive or negative
based on direct experience
Encoding of evidence The user will know whether the four-stroke
scooter is good or not
Integrating evidence with Assessment, not only of the four-stroke
with existing beliefs feature but also of the brand of
four-stroke scooters
Learning from experience is a critical component of the disconfirmation
process because it does not just deal with satisfaction/dissatisfaction; it also
has positive or negative implications on word of mouth.
Marketing Implications
The process of learning from experience has several marketing implications.
A market leader (brand) can emphasize the positive aspects because of famil-
iarity, especially if the motivation on the part of the consumer to learn new
information is low. This, in particular, can be useful for strong brands. A leader
in a milk additive brand known to consumers for a sustained length of time
can make its proposition contemporary, and hinder the follower brands' (new
ones) efforts to hammer down their new proposition. Consumers, for example,
may connect the brand with good health without knowing how the proposition
13  Concepts of Customer Satisfaction, Loyalty and Relationship Management 343
is delivered by the brands. Such an approach would require a strong trust to

be built up by the brand over a period of time. The target segment of buyers
(in this case, perhaps, the mothers) will be highly motivated to learn. If con-
sumers are highly motivated to learn but do not know why a brand is effective
(ambiguity), the leader can “reinforce the agenda”. Microsoft emphasizes its
variety of applications when an unknown brand wants to make an impact,
especially when consumers are highly motivated to learn, and the brand has
a strong USP. When Lexus was introduced, it emphasized the vibration-less
smooth ride that consumers could experience (consumers' motivation to learn
can be judged through research).
Box 13.1
Customer Satisfaction and
Assimilation/Contrast
An interesting aspect of customer satisfaction is associated with the con-
cept of assimilation/contrast. Consumer decision making and satisfaction
is reflected in a specific post-purchase phase. This may be more applicable
to complex products (durables) that involve high prices, high perceived
risks, a high degree of search efforts and self-esteem. Advertising and
other forms of marketing communication trigger the expectation levels
of consumers. Consumers tend to compare their expectations with prod-
uct (brand) performance during the process of satisfaction formation, as
indicated in the disconfirmation model. When they do this, they may be
prone to assimilation or contrast effects. A consumer, who buys a brand
of two-wheeler after a careful analysis and processing of purchase infor-
mation, may expect a certain mileage from the brand. If, for example, he/
she expects 60 km/litre and finds that the actual mileage is only around
55 km/litre, the assimilation effect can set in. The consumer may assimi-
late the difference between expectation and performance. Hence, he/she
may not develop a negative attitude towards the brand, but focus on its
positive attributes instead. But if the mileage is around 40 km/litre, the
contrast effect may set in, and the consumer may magnify the vehicle's
poor performance and develop a negative attitude towards the brand.
He/she may focus on the other negative aspects of the brand as well.
The degree of disparity between expectations and performance (for any
given attribute) determines the presence of assimilation or contrast effect.
This can be particularly important for “negative disconfirmation” situ-
ations. Marketers can research post-purchase feelings of consumers (as
compared to their expectations) and take appropriate measures to ensure
that a negative word of mouth is not propogated.
Seeking Customers and Retaining Customers—

The Concept of CRM
Customer Relationship Management (CRM) has gained importance with the
onset of e-commerce. A marketing practitioner needs to understand what is
CRM, its impact on an organization, its applicability and its benefits to custom-
ers, and not just the marketing aspects. There is also a need to understand that
CRM is an overall strategy for an organization and not just a short-term sales
tool. The CRM strategy requires a long-term plan and any such plan requires a
strong organizational commitment and appropriate investment.
Customer Relationship Management as a concept is as old as marketing
itself. Firms in both consumer and business-to-business marketing have always
(by accident or design) made attempts to encourage repeat buying from regu-
lar and frequent consumers. The average consumer would have experienced
this aspect of (though in a very indirect form) CRM in small grocery shops and
large outlets. What has been added to this kind of CRM is the collaborative and
co-operative aspects from the consumer's end in the current context. This collab-
orative effort can assume complex forms as in business-to-business-marketing
(with different buying influences) or it can simply involve a credit-card holder
sharing his personal (demographic and psychographic) information with the
marketer. The CRM structure, then, for business-to-business marketing may be
different from the one required for consumer marketing.
The Concept of CRM

Customer Relationship Management is a relationship process which a com-
pany can cultivate with its customer groups/segments in such a way that it
benefits both the customer and the company. The prerequisites of any CRM
program are:
1. There has to be willingness on the part of both the company and the cus-
tomer to stay committed to the relationship, which is based on mutual
benefits. This is required because organizational process changes may
have to be initiated in both the marketing and buying organizations
(in the case of business-to-business marketing) and hence, the top man-
agement has to be convinced about CRM in both the companies.
2. The marketer should have a non-transactional orientation. A transaction
is a one-off interaction. Hence, CRM involves a combination of strategies
that build the relationship between the marketer and the customer over a
period of time. Nevertheless, transaction-based loyalty programs can be
formulated.
3. The marketer should be willing to invest in an infrastructure, which can
implement and operationalize CRM. The infrastructure may include
Web-based hardware/software that can effectively harness the advan-
tages of CRM.
It should be understood that technology is a tool and that it is a part of

the overall CRM strategy. This needs to be conceptualized with various
considerations.
CRM is not
 just having a call-centre without appropriate strategies
 just having a database of consumers for sending direct mail
 just establishing a social relationship with the consumer
 having an eternal price discount procedure.
CRM and its Linkages

Given the nature of the concept, a few aspects of CRM may be associated with
business-to-business marketing. It should be noted that any CRM program
should be associated with loyalty and customer satisfaction. These two things
suggest that different customer segments/groups are interested in different
dimensions of the offerings. The implication of this aspect will be reflected in
the planning of loyalty programs and monitoring of satisfaction parameters
as shown in Figure 13.1. Further, the selection of a target segment or a specific
company in a business-to-business context is of utmost importance, because
the profitability of a CRM program will vary across segments (or companies).
A company introducing a CRM program needs to undertake customer
research in terms of how well the groups of customers can be rewarded. This
is because once a company introduces a CRM program, it is difficult to dis-
continue the program. Besides, any reward/loyalty program needs to end in
profitability for the company. Given the fact that these types of programs can-
not be stopped abruptly (should there be a need because of reasons of profit-
ability), especially when competitive companies are following suit, a company
CRM
Segments / Companies Communication
Loyalty Satisfaction
◆ Transaction or non ◆ Parameters of

transaction based satisfaction
or both
◆ Profitability from ◆ Specific objectives of

loyalty CRM (which will define
the parameters)
Figure 13.1  CRM and its Linkages

has to be very careful in selecting specific segments of customers even for a

commonplace strategy like the frequent-flier program.
While there is substantial growth in SOHO (Small Office Home Office) and
SME (Small and Medium Enterprises), a company like Dell Computers may
decide to concentrate on large companies for its CRM programs from the point
of view of loyalty and profitability. It may also be essential for a company to
assess the lifetime value of a customer before formulating a CRM program.
While loyalty and satisfaction are strongly linked to the CRM program, the
specific objective of such a program for a customer may have to be decided
by a company before planning the appropriate program. For example, reduc-
ing the cost of distribution may be the objective of a CRM program at a given
point of time. This may involve restructuring ordering patterns, having con-
sidered the consumption patterns and inventory levels at the customer's
end and production systems at the manufacturing end. The cooperative and
collaborative aspects mentioned earlier can be noted here. Similarly, in con-
sumer marketing, the objective of a CRM program for a fast food company
may be increase in the frequency of purchase of a food item. A promotional
program for the brand can be made part of the CRM plan. This will result in
rebuying, at least from a section of consumers that may be satisfied with the
manner in which the company has gone about implementing the CRM plan
(for example, in providing a variety of recipes with a food item for a segment,
which the company believes can exhibit loyalty). Loyalty in categories like
fast foods, soaps and confectionery can be driven through innovative CRM
programs.
Apart from the linkages between loyalty and satisfaction, communication
is a vital aspect of any CRM program. Communication about state-of-the-art
offerings concerning the product category, the effort that the company/brand
makes to keep itself updated, satisfied customers and specific benefits of a
CRM program may help a marketer to reach a prospective segment of con-
sumers who may like to be a part of the CRM program.
The following guidelines may enable a marketer to identify specific cus-
tomer groups that may be amenable to CRM programs in business-to-business
markets.
Segmentation criteria as a percentage of customer profitability:
 Price-sensitivity (no-frill offering)
 Pre-sale service
 Annual maintenance contract and spares
 Willingness to try innovative products
Willingness to try innovative products is a criterion that may be especially
useful to cutting-edge technology companies. These companies may want
to establish a CRM program with customers who are willing to try innova-
tive products, if doing so benefits their applications. Xerox tied up with air-
craft companies (like Boeing) to introduce their DOCUTECH model of copier,
which is ideally made to edit, copy and process several pages of data. Such
features are most suitable for aircraft companies that have different mainte-
nance manuals for different types of aircraft.
A manufacturer of trucks (like Ashok Leyland or Telco) may want to do a
CRM program with a company that owns a large fleet of vehicles. A main-
tenance package can be customized for every customer depending on the
number of vehicles and their usage. The customer is likely to be involved in
such a CRM if the program also includes spares management. Loyalty will be
the logical fallout in this context. This is because the customer realizes that
the CRM program is linked to his being able to save costs if he buys the same
brand of truck, especially over a period of time. The customer will benefit
from dealing with the same company with regard to maintenance schedules
and interpersonal relationships. Breakdowns would be under control because
recurring problems can be anticipated and avoided. The cost of procuring
spares from different companies is likely to be high if trucks are bought from
different manufacturers. The company which has a CRM with the customer
is likely to give the latter priority attention apart from enabling him to save
costs over a period of time.
The one-to-one marketing programs that are generally associated with con-
sumer products, can also be effectively applied to business-to-business mar-
keting. Proctor & Gamble has a special team to service and develop its business
with Wal-Mart, the largest retailer chain in the world. The key account man-
agement concept in which companies employ customer teams (chemicals and
computers may be examples) is a kind of one-to-one marketing. When this
concept is extended to a company which has multiple locations, it becomes
a national account management program. Such strategies involve extensive
resource allocation to teams and in-depth planning with customers on their
specific needs.
CRM and Consumer Products

Common loyalty programs in the airlines and credit card industries are con-
tinuity programs. However, these programs are handicapped by the dominant
presence of “transaction orientation”. As indicated earlier, a typical relation-
ship program should not be dependent on sheer transactional value (though it
may be one of the ways to keep consumers coming back). Secondly, firms will
need to have the most appropriate segments based on “customer yields”—
since this would determine the profitability aspects. A structured and planned
effort, with extensive research on the buying process, must be focused on the
right type of segments. The best form of such loyalty programs should com-
bine transactional elements with information about the category and about the
specific needs of consumers. This combination of transactional orientation and
one-to-one orientation (not only in terms of price but also in terms of special-
ized and customized needs) is likely to be very effective in seeking customers
and keeping them. A brand like Pond's may offer customized advice on skin-
care to individual consumers and, in the process, create a consumer database.
This non-transactional approach of drawing customers towards the brand
can be combined with specific strategies of offering certain benefits to special

consumers who have purchased the products of the brand beyond a specific
value over a period of time. Frequency marketing programs and interactive
programs can be focused on specific segments depending on the response of
consumers over a time span.
A prerequisite to CRM, especially in consumer products, is the availability
of information with regard to demographic and psychographic spending pat-
terns. Marketers in India may take a while to get such information, as estab-
lishing a database depends on the penetration of credit cards and their usage
at retail points. Data-mining techniques enhance the quality of one-to-one pro-
grams designed to address customized needs.
Drivers of Relationship Programs

The concept of a lifetime customer has opened up new dimensions for market-
ers. They can now approach customers with strategies to retain them if they
are satisfied. A brand can calculate the “lifetime” worth of a customer in a spe-
cific segment based on certain kinds of primary research. A soft drink brand
can be consumed by children, adults and teenagers under a variety of situa-
tions. It can estimate the worth of an average customer (average calculated on
the frequency of purchase) in each of these segments. Loyalty helps a brand in
a number of ways.
1. Loyal customers are diehard customers. Research studies show that these
customers may not even look at advertisements of competitive brands.
This is an extremely important advantage for a brand in an environment
of communication clutter.
2. Loyal customers spread a positive word about the brand. FMCG brands
in developed markets of the world today, are interested in quantifying
the impact of this word of mouth (positive or negative).
3. Research reflects that it is more economical for a brand to retain loyal
customers as compared to procuring and nurturing new customers.
4. A brand, which has products in several categories (Samsung), can
attempt cross-selling to a loyal customer base. Cross-selling involves
introducing and marketing new offerings of a brand over a period of
time to customers who have bought one of its offerings. A buyer of a
refrigerator can be led into buying a TV, microwave-oven and/or wash-
ing machine, cooking range etc of the same brand.
5. A company, especially in durables, may be interested in finding out when
a consumer upgrades to better products—say from a semiautomatic to
fully automatic washing machine, from a Maruti 800 to Swift or from a
165 litre refrigerator to a higher-capacity, no-frost model. If a company
can ensure that customers stay loyal or build a relationship with them,
they will come back to the former for the “upgrades”. A well-structured
database, formulation of loyalty schemes and monitoring satisfaction

levels of consumers over a period of time are synergic strategies that can
help a marketer of durables. Even in the case of consumables, sustain-
ing consumers and enabling them to upgrade to better products may
be profitable for a company with a long product-line. Detergents, soaps
and toothpastes are category types where this kind of approach may be
useful.
6. Loyalty brings revenue in the form of after-sale service contracts in cer-
tain markets that may experience saturation. Otis gets a significant por-
tion of its revenues in Western markets through such contracts. Copiers
form another category that may benefit from these aspects.
Critical Considerations for a Loyalty Program

Segmenting Customers on Profitability Differential marketing (DFM),
advocated by Hallberg proved that all consumers are not created equal. The
fundamental questions which a company should take into consideration are:
1. What percentage of consumers contributes to profits?

2. What is the frequency of purchase associated with these profitable con-
sumers?
3. Can a part of the advertising budget be spent on profitable consumers, in
the form of reward programs or direct marketing?
4. Is it worthwhile covering the entire segment with mass media?
5. What are the psychographics of profitable, frequent buyers/users of a
product or service?
Clearly, this approach is different from the traditional one that companies
have towards customers. An airline company may find that a small percentage
of consumers contribute to a large portion of profits. (The American Airlines,
which was one of the earliest companies to start a “frequent-flier” reward pro-
gram, used this approach). Apart from the “free mileage” program, the psy-
chographics of frequent fliers may help an airline to formulate promotional
schemes. It may find that most frequent fliers buy designer-wear. This can lead
to a collaborative tie-up with a manufacturer of designer-wear brands as part
of promotional effort, which will appeal all the more in the context of compe-
tition.
Apart from profitability, consumer profile is important, especially for
products that have low levels of penetration. Hot-chocolate drinks (like
Drinking Chocolate from Cadbury's), which are different from malt drinks
(like Bournvita), have a low level of penetration in spite of being in the market
for about four decades. Consumers may buy such a product for purposes
other than drinking, probably to use them in their food recipes. Regardless
of why a product is bought, the marketer should know the demographic
as well as the psychographic profile of consumers. This, because nurturing

and sustaining loyal buyers is as essential as increasing the consumer base
in the category. A pioneering brand also has the advantage of building itself
along with the expansion of the category.
The Impact of Communication As a market expands, different

needs emerge from different kinds of customers. Companies usually
cater to these needs by offering a product-line (variants of the product). A
company that markets creams may have three variants—plain, moisturizing
and herbal. Selling different variants offers variety to consumers. But the
important question is whether all these variants are suitable for all skin
types unlike variants in categories like biscuits and chocolates that serve to
keep up the excitement around a brand, apart from appealing to different
tastes. Communication, in this context, performs the role of establishing a
relationship between the company and the consumer. Creating awareness of
and identifying the skin-types, skin problems and impact of climate/weather
on the skin etc., may be important aspects that need to be communicated before
a consumer thinks of buying a variant. Communication, in such a situation,
is time-oriented, sequenced and may even have to be customized when a
particular consumer starts looking for advice on his/her specific problem. A
company has to make a special effort to formulate the communication, which
includes not just information on skin-types but also the right kind of appeal
for its products. Besides, the timing of introducing a brand will also have to
be taken into account during the different phases of communication with the
consumer. It may be worthwhile to note that the communication involved
in the relationship-building exercise is different from that which is mass-
media oriented. A company like HMV can develop a customized advertising
through several channels if it has a database of consumers interested in
different kinds of music (India is one of the largest markets for music in the
world)
Transactional and Non-transactional

Loyalty Programs
A company interested in loyalty programs should consider transactional and
non-transactional methods of doing so. This will, of course, vary from one
product/service category to another. For example, airline and courier services
may be oriented towards transactional loyalty. Customers are likely to choose
an airline that offers the most attractive frequent-flier program (all other things
being equal).
There may be product categories in which consumers may want as much
information as possible on usage and other aspects. This is quite applicable in
the Indian context as a huge population of consumers wants to know, buy and
use products they have not been familiar with in the past. Health supplements
(like Spirulina), branded nappies and baby foods, mouthwash and fast foods are
examples of categories that can be expanded in the Indian context. Consumers

may want to know the frequency of usage/intake, nutritional value, long-
term impact, type of ingredients and the continuity of usage. This offers tre-
mendous scope for marketers to give information to prospective consumers,
thereby winning their confidence and building goodwill for the brand. Non-
transactional loyalty programs can lay the foundation for transaction-oriented
reward schemes. They emphasize that the brand/company is not just a price
warrior but one that it is aware of the kind of customer orientation required in
the category.
Pricing and Loyalty

One of the limitations of heavy sales promotion is that consumers are
“inducted” into the “price-war” mindset. This may be counter-productive
to loyalty as consumers tend to pick up the cheapest brand or the one that
is offered under similar sales promotion (discounts or freebies with the pur-
chase). Soaps, toothpastes and noodles are examples in the Indian context. A
sales promotion, by itself, may be an effective tool. But a brand must plan
carefully the objectives of the sales promotion from the point of view of loy-
alty. Most brands fail on this count. A large company marketing a brand of
noodles (with much brand-building effort) can use relationship pricing by
cross-selling its other fast food products. This is different from sales promo-
tion. A combination of units purchased across products over a period of time
and the savings therefrom, along with contests for consumers can be a useful
relationship program. This need not be short-term (like a sales promotion).
Besides, the consumer will also be motivated to buy the other offerings of the
brand. The underlying assumption in such programs is that the products of a
company attempting such an approach, are good offerings.
Loyalty programs have to be planned using a lot of information about
the various segments of a product/product-line. These include both demo-
graphics and psychographics. A problem specific to the Indian context is the
small population that uses credit cards. A major chunk of sales happens at
small retail outlets, unlike in the West where the sales take place in depart-
mental stores. These stores employ many tools to capture valuable data
(including customer-specific data on consumption patterns). Companies may
also make similar efforts to collect the required data before attempting to for-
mulate programs. It may be possible to do so if a company has a proper system
to follow up and track customers after the sale is over, at least in the case of
durables. For instance, consider the passenger car market. There are several
models and different kinds of buyers in this segment. It may be worthwhile
to know what type of customers upgrade to better models and when they do
so—be it in terms of time period or enhanced lifestyle of the consumer. This
will not only help the company to come up with customer-retention programs
but also help it time the launch of a new offering.
Marketers can explore unlimited possibilities if they synergize databases
and loyalty patterns to develop relationships.
Brand Loyalty as a Strategy

Even though there haven't been too many retention strategies in the Indian
context, marketers have known for two decades that retaining a consumer is
several times more profitable than gaining a new one. It is, however, import-
ant to consider the impact of retaining loyal customers on the profitability of
a company. Recent research across product categories shows that a 100 per-
cent and indiscriminate retention is not always profitable to the brand. A basic
understanding of retention strategies is required for a marketer to plan CRM
(customer relationship management) strategies. There cannot be a better time
to understand and implement customer retention strategies (in both consumer
and business-to-business marketing) than the current marketing context when
there is a downturn in the economy in several markets and the need to retain
profitable customers is fairly high.
Customer equity deals with the manner in which customers can add value
to the profitability of the company. Loyalty and retention strategies have to be
understood before customer equity strategies are formulated. The following
aspects of customer equity may be useful for marketers:
 What is brand loyalty?

 Is brand loyalty built on functional or symbolic aspects?
 Do psychological factors matter to brand loyalty in business-to-business
marketing?
While in-depth aspects of customer equity are firm-specific, there are some
general concepts, which may provide insights to marketers. These concepts
relate to the questions mentioned above. There is a need not only for strategies
to be oriented towards customer equity but also for investment to be made in
researching the behavioural aspects of customers, to know the underpinnings
of loyalty or retention.
Brand Loyalty
Brand loyalty occurs when a consumer makes a repeat purchase out of a com-
mitment to the brand. Marketers may do well to check however, if the repeat
purchases are made out of commitment or if they are merely “inertia pur-
chases”. In the latter case, a consumer may keep buying a brand of soap or
toothpaste because of its availability in a specific stock-keeping unit, which he/
she can afford (a 50 or 75 gram package is the specific unit referred to in this
context). But when the consumer makes a deliberate choice from among alter-
native brands out of commitment, he/she is “brand loyal”. The consumer does
not go through a decision process to select a brand when he/she is brand loyal.
Though habit and loyalty may be similar and even overlap, a repeat purchase
made out of convenience will be classified under habit whereas one made out
of commitment is loyalty. When a consumer develops loyalty towards a brand,
he/she develops a favorable attitude towards it. This results in commitment.

Brand loyalty offers a number of advantages to the marketer. Brand-loyal con-
sumers start building a relationship with the brand. They may advocate the
brand to others. They may even become passionate and form clubs, which
strengthen the brand even more. Harley Davidson, the motorbike brand in
the US, illustrates how brand loyalty can reflect so passionately in consumers.
Members of the Harley Davidson “club” get together and take adventure trips
on the bikes wearing special garments created by the brand. This link between
brand loyalty and its display or visibility rubs off on the equity of the brand.
Loyal consumers may also try out the variants of the brand and, in certain
categories, even pay a premium to pick them up. High-priced cigarettes and
perfumes are examples. They may try out offerings in other categories of the
brand. Consumers who are loyal to the brand, are likely to order several cat-
egories from the store. This indicates store loyalty. Under certain conditions,
consumers may also transfer their brand loyalty across product categories.
Brand loyalty can be enhanced if the sampled product results in a high
degree of satisfaction. This is because the consumer feels that the time invested
in learning about the brand has resulted in a positive outcome. If a consumer
spends significant time in choosing a readymade wear brand and feels greatly
satisfied, he/she will very likely become a loyal consumer of the brand. This
is because, he/she has invested precious time learning about the category
and secondly, the brand has made him/her happy. This may discourage the
consumer from experimenting with other brands during his/her subsequent
cycles of the category purchase. Marketers would do well to find out how con-
sumers learn about a product category and brand, because the insights would
not only provide a learning experience (besides a good product or service) but
may also have an impact on loyalty. For example, the experience of logging on
to Amazon.com may be as important as the benefits offered by the Web site.
Is Brand Loyalty Built on Functional or

Symbolic Aspects
Several theories and models associated with the consumer loyalty and learn-
ing process suggest that consumers may become loyal, initially due to the
functional benefits of a product/service. Loyalty across toothpastes, cars,
banking services and books clearly shows that a brand has to score on func-
tional aspects whenever consumers use “search-oriented” products (search-
oriented products are those that consumers can evaluate even before they
buy/try them). For example, a consumer may go through the ingredients of
Colgate Total, derive inferences about the benefits (evaluate it to a certain
extent) and then try the brand. Loyalty towards such search-oriented prod-
ucts happens when the consumer experiences the benefits of their functional
attributes.
Symbolic associations also play an important role in strengthening brand
loyalty. Gel toothpastes are advertised on symbolic attributes. This triggers
a certain kind of loyalty because of peer group associations and this can hap-
pen after the brand has been established. But even when symbolism triggers
loyalty, a certain degree of benefit should emerge from brand usage. Symbol-
ism can have an impact on loyalty related to products that are consumed for
sensory gratification—like beer, perfumes and cigarettes. Communication built
around symbolism (status or snob appeal or group affiliation or a personality
trait) adds to the gratification inherent in the product and results in loyalty.
Raymond, which has positioned itself for the “complete man” in recent times
may attract a certain degree of loyalty from its target segment. But it is also
true that in this kind of product category, improvement in functional attributes
can strengthen and sustain brand loyalty.
In categories such as hotel services or airline services where experience
is what really counts, symbolism can enable consumers to try the service.
Experience-related services are those which can be evaluated only after the
consumer has “consumed” or tried the service—in other words, been through
the experience. A hotel or an airlines can use symbolism in its advertisements
but the “experience” will be the real and final test which may/may not trigger
loyalty.
There may also be psychological factors like trust, peace of mind, reas-
surance and risk reduction, which may have a pronounced impact on brand
loyalty. A courier services company may belong in the “experience” category.
A feeling of trust and reassurance resulting in peace of mind may give it a
loyal set of consumers. The consistency associated with the benefits of repeat
purchase may also be contributed to psychological factors associated with loy-
alty. A consumer who consistently gets good food and positive experience at
a McDonald's outlet becomes loyal to the brand and may patronize the brand
in several countries.
An ideal approach for a brand will be to use the functional route to loy-
alty, and over time, use appropriate symbolic communication to strengthen it
(see Figure 13.2). The basic assumption here is that the brand will constantly
Brand Functional
proposition
Loyalty
Symbolic strengthening
Time of existing association
Product improvements
to retain loyalty
Figure. 13.2  Loyal Strategy as a Cycle

update its offerings (or product-line) to secure an advantage over competing

brands. A brand has to adapt itself to the changing environment over a period
of time (while using symbolic imagery consistent with its brand proposition).
Functional utility needs to be backed up by symbolic association. Consumers
need to be convinced both about the functional utility and the psychological
significance (to the segment for which such a “statement matters”) over a
period of time. Samsung's accent on features and service together with certain
symbolic associations the brand had created over a period of time (through
marketing communication for some of its products) is an example to illustrate
the combined impact of functionality and symbolism.
Symbolic or psychological appeals should strengthen loyalty rather than
alienate the existing loyal base of consumers. Volvo, a brand name known for
safety and reliability for several decades the world over, may launch advertis-
ing campaigns with psychological appeals that reinforce the safety image. The
advertisements may show scenic spots for the weary urban-tourist and say
how he/she can reach these places safely with their Volvo. Psychological fac-
tors like reliability, trust and reassurance also matter in business-to-business
marketing as they provide the basic platform for CRM.
Retention
As stated earlier, 100 percent retention may not be very profitable. An airline
like will certainly like to retain 100 percent of its customers in the top segment
(the business class). But there is a vast segment, which is highly price-sensitive.
Several factors have to be analyzed before a decision is taken to retain these
price-sensitive customers with rewards and freebies. Price-sensitive customers
may shift to another brand, which offers them more freebies. Besides, it may be
worthwhile to analyze the purchase pattern—what is the potential profitabil-
ity of retaining these customers?
Loyalty and retention strategies formulated in a systematic manner can
result in sustained profitability.
Planning Customer Relationships

There have been a number of studies in recent times on how customer reten-
tion can contribute significantly to profitability. In the times of the Internet,
it is worthwhile to analyze how this low-cost reach can lead to profitability.
Some companies like Siebel, Oracle and Broadvision have created useful CRM
products, which can track a number of dimensions of consumer behaviour.
There is a basic need on the part of any organization to have a good internal
coordination before a CRM package can be used effectively. The impact of con-
sumer behaviour on CRM is equally important to firms conducting business
on the Internet. One study indicated that though the acquisition costs of online
consumers can be high, they spend more over a period of time if they develop
loyalty towards an online store
CRM as a System
Customer Relationship Management (CRM) is a complete system with a num-
ber of inter-linkages—beginning with what type of consumers should be tar-
geted to finally obtaining efficiency in it. Unless an organization has a holistic
view of CRM, it may begin to concentrate on those aspects of CRM, which may
not have critical linkages with the other important dimensions of marketing.
Online processing or customer call-centres alone cannot lead to a successful
CRM. A CRM has to start with a good database of consumers and it should
have a “historical” perspective on them. For example, it should be possible
for a CRM program to have specific strategies for prospects, first-time buyers,
repeat buyers and advocates (or the highly loyal consumers). CRM strategies
have to take into consideration these differences to qualify consumers for a
CRM program. This is important because a CRM program has to be beneficial
both to the company and its consumers. This holds true in the case of both con-
sumer and industrial products.
Importance of a Database
A brand like Louis Philippe that introduces several designs (and has stock-
keeping units or SKUs), especially for a niche market, would be interested in
obtaining the profile of the consumers. Apart from the basic demographics
and psychographic segmentation, the consumption data may also be import-
ant to a CRM program. Is the consumer interested in music, sports, clubs or
other forms of entertainment? Does he/she shop at an exclusive showroom
or at other large outlets where he/she can get more variety and also compare
other brands in the same league? Does he/ she always buy the brand? What
is the frequency of his/her loyalty? Does he/she make use of frequent flyer
schemes when travelling? (This information is useful for formulating promo-
tional deals.) Where does he/she holiday? What kinds of channels does he/
she watch? For example, Madison Research found that an elite segment (target
for premium brands) mostly watched English programs/channels in urban
areas. There are also implications of SKUs consumed for the CRM program.
For example, does a heavy spender on the brand show a distinctive pattern of
buying a specific type of design?
In industrial markets, it may be important to have the details about the
prices paid, delivery dates and the share of the customer requirement. This
may be useful to identify specific consumers who may have increased their
share of requirements from an organization (or brand) over a period of time,
the pricing of such offerings, and other promotional elements. CRM opera-
tions become more complex in industrial markets because the buying organi-
zation may have to restructure its systems to have a CRM relationship with the
marketing organization.
Any database, which becomes an input for a CRM program must also have
a record of how consumers have responded to promotional initiatives. Have
they responded to e-mail or direct mail? Can personal selling prove better than
initiatives because of specific reasons, such as concept selling for a new kind
of detergent or shampoo? How has a consumer segment responded to a sales
promotion? A watch company may have a large retail network in a country
like India. If it is important for the company to capture consumers who like
to own multiple watches, it would do well to get data on their response to its
sales promotions during certain months of the year. Has there been a better
response in neighborhood areas that satisfy other criteria formulated for mul-
tiple ownerships? These are some critical aspects associated with the database.
The service sector – banks, telephone, cable and medical services – must be
able to frequently update its database because of its competitive nature. Sus-
taining an innovation is more difficult in a service industry. Frequent updates
can ensure that a service industry develops a significant advantage in conjunc-
tion with technology. For example, holders of a credit card may want to shift
to another brand, which offers a combination of safety features rather than just
a single feature. This aspect may be relevant in several phases of the market-
ing cycle—attraction, acquisition or retention. In fact, this one USP may attract
a consumer to the brand. He/she may even decide to stay with it because of
the other experiences he/she has had with the brand during the association.
Such a feature may be more appealing for this safety-conscious consumer than
a “cross-promotional” benefit (by which the points earned could be redeemed
against a variety of products/brands) offered by a competing brand.
The database may also depend on the frequency and nature of customer
interaction. Banks may have an advantage because of direct and frequent
interaction with consumers. They may have more access to information, than
a brand dealing with packaged FMCG (because the latter only has indirect
contact with the customer whose buying frequency is lower). It takes several
years of data monitoring to have databases in categories such as durables. A
brand like Britannia can declare a contest in which children will be rewarded
for giving important information about themselves, the food categories, they
consume or even those categories which compete for their share of the wallet.
A regional brand of furniture can organize an event and obtain information
that can be useful in formulating a CRM program.
Databases can also enable the inclusion of “cross-selling” and “upselling”
in a CRM program. A durable brand like LG has a number of product cat-
egories. It can attempt cross-selling these products to those consumers who
have tried out at least one product of the brand. A good database also enables
a brand to “upsell” or upgrade the consumer to a better offering by formulat-
ing a promotional package. Taylor Made, manufacturers of golf equipment,
has a database of 1.5 million golfers that covers several aspects. Thomas Tours,
a travel company in UK, provides incentives to channel members to collect
information on its target segment.
Qualification of Consumers
Selecting consumers for a CRM program is important because profitability is
associated with such an exercise. When profitability becomes the basis for the
selection of consumers, a company assesses the profitability of specific seg-

ments (for example, high usage potential for a credit card company) and even
analyses the lifetime value of a customer (when it is appropriate to employ
customized techniques for a CRM program). The latter can get complex with
forecasting models and probabilities built into the system. In fact, a brand may
even be able to “fire” non-profitable consumers during this exercise. There is
also a possibility of developing marketing strategies that distinguish between
levels of customer relationships. AT&T offers different kinds of services to con-
sumers based on their levels of profitability. This may be relevant for provid-
ers of Internet services, and mobile and telecom services. It may be better to
employ methods, which will gradually remove unprofitable consumers (for a
company, which is in the process of introducing CRM with a large consumer
base) to ensure that they do not carry a negative word of mouth.
While qualifying consumers, companies have to use the “dialogue” method.
This may be difficult in the Indian context because telemarketing has not caught
on. Wherever possible, a company can use personalized e-mails. Companies
may even have to give incentives to consumers to answer such e-mail/direct
marketing queries concerning CRM. E-mail is extremely cost-effective when it
comes to customer retention, provided an appropriate database is available.
Southwest Airlines markets its “Click and Save” program to about two to seven
million consumers in the database. It sends an e-mail containing the details of
special offers to these customers every week. Borders.com uses e-mail to alert
its readers about forthcoming book releases.
What Makes a Good CRM Program?

Customer services (both pro-active and reactive) are required to build a rela-
tionship of trust and cooperation. Companies like Vanguard and Schwab
(financial services), provide useful information to investors, which motivate
them to return to the site. There should be a variety of options for the cus-
tomer to contact the company in case of product failure (these options may be
service centres, e-mail etc). CISCO provides technical information concerning
design. This attracts thousands of engineers to its Web site. Loyalty programs
like frequent flier programs may be useful in retaining consumers. But these
programs may be expensive and replicated by competitors. Besides, prof-
itability levels have to be considered. Hence, pricing the “loyalty package”
is important. For example, the price may be lowered to acquire consumers.
But if these so-called loyal consumers stop using the brand purely for rea-
sons of price when they find a better deal elsewhere, the initial “low-entry”
price may not be a good idea. In the foreseeable future, loyalty programs may
be a prerequisite for a brand to enter competition. A high degree of custom-
ization (not just of the product but the entire marketing mix) may enhance
the prospects of a CRM relationship. It may be difficult to be implemented
profitably in certain categories. Building a community may be another dimen-
sion of CRM. Harley Davidson, the motorbike brand, is a good example of
how community-building by a brand can bind consumers together. In certain
industrial products (like industrial automation), a brand can bring together its
customers for knowledge-building purposes.
CRM goes well with supply chain management and other systems like ERP.
Hence, planning and integration of several associated concepts are required to
make a difference to the consumer's experience with a brand or organization.
Customer Mapping: A Practice-Oriented

CRM Tool
Several dimensions have been explored with regard to CRM. It has been
explained as a long term, cooperation relationship between the customer and
the marketer. The emphasis is on the relationship as opposed to a transactional
exchange. The focus of relationship marketing should be cooperative and col-
laborative actions that deal with the needs of consumers. Hence, the definition
of relationship management as an ongoing process of engaging in activities
and programs that create or enhance mutual economic value at reduced cost
appears to be practice-oriented. The existence of a buyer–seller relationship
cycle has further heightened interest in relationship marketing according to
which the cost of retaining customers is much less than the cost of acquiring
new ones.
With markets becoming more competitive and driven more by profits rather
than market share, companies have realised that all customers are not created
equal. Some among them need more specific strategies of relationship market-
ing than other customers (or segments). This has led to relationship programs.
There are three levels of relationship marketing, identified as financial, social
and structural. The first level deals with financial incentives to customers; the
second with social bonds (like the sense of belongingness generated by Har-
ley Davidson Owners' Group), and the third level relies on structural aspects
to solve consumers' problems. The powership program of Federal Express,
which installs computer infrastructure at the offices of high-volume customers
is an example of structural bonding. Powership uses the structural arrange-
ment to provide information to customers on several aspects of their needs,
including the tracking of packages.
Customer retention has been established as a highly competitive weapon.
Marketers are interested in relationship marketing because of the many ben-
efits of customer retention. Consumers are interested in it because it helps to
reduce their costs and increase need-related benefits. Repeat purchases by con-
sumers indicate that there is scope for such a relationship. Also, with time,
consumers tend to limit their choices in purchase and consumption.
CRM-oriented Strategies
Marketers follow a number of CRM strategies. The important ones are as
follows:
 Customer intimacy: A high degree of collaboration between the buyer and

seller can result in an enhanced offering for the former and profits for the
latter. The seller (in an industrial marketing context) uses the enhanced
offering to meet the requirements of his end-users. The collaboration
of Xerox with Boeing to produce an advanced version of Docutech is a
good example of this strategy. The offering proved severally beneficial to
Boeing in formulating customized maintenance manuals for each of its
aircraft.
 Customization: Mass customization can be used as a tool for building loy-
alty and relationship. It uses flexible processes to produce individualised
offerings on a mass scale. The proposition of such an offering is that it
is specified by the customer. Dell Computers offers such high degree of
customization.
 Relationship programs: There can be several kinds of relationship pro-
grams, which are oriented towards CRM.
There are continuity relationship programs, which encourage consumers
to extend their relationship with marketers. These may be membership or loy-
alty programs. The more the consumers buy the products or services, the more
will be the magnitude of rewards in the form of discounts on cross-purchased
items or on future purchases; or there may be specific rewards for accumulated
points arising from frequent purchases (free air-tickets by an airline based on
the travelling frequency in a frequent-flyer program).
The one-to-one marketing program takes the customization approach in
consumer and industrial markets. Technological intervention, through sophis-
ticated tools and databases, has made it possible for marketers to obtain
online information on purchases at retail points. This helps them to cater to
the unique needs of mass market consumers. Interactive marketing and after-
marketing programs can be formulated by using one-to-one marketing pro-
grams. A newspaper company can have several add-ons (apart from the core
news pages) to cater to the individual needs of readers or reader segments.
National Panasonic created several millions of versions of the basic bicycle to
cater to various consumer preferences. There were different versions in terms
of height of the handle bar, colors, seat adjustments etc.
Customer Life-cycle Strategies

A customer life-cycle operates on the fundamental assumption that the rela-
tionship between the consumer and marketer depends on the stage of the for-
mer in the customer life-cycle. The life-cycle may consist of several categories
of customers like prospects, early buyers, repeat buyers and hardcore custom-
ers. The assumption is that different kinds of customers (based on the relation-
ships) will be interested in different kinds of marketing mix elements. The
prospects may be interested in getting complete information on the benefits of
the brand. The early buyers may want to know more about after-sales service.
The repeat buyers may be concerned with rewards, provided they are satisfied
by the product/service. The hardcore buyers (or frequent buyers of the brand)
may be interested in greater, customised rewards. The implications of formu-

lating strategies for these various types of customers are also different. Value
(based on price, features and psychological dimensions like security and peace
of mind) may be important for the early buyer. The hardcore buyer who is in
the retention stage, would be interested in seeing how differently the brand
treats him/her after a spate of purchases he/she has made.
Customer Acquisition and Retention Strategies

Given that retaining consumers is several times more profitable than acquiring
new ones, marketers are involved in acquiring the right kind of consumers.
These consumers are less expensive to acquire, have a high degree of poten-
tial and become profitable quickly if retained. Customer databases, compet-
ing brand propositions, the concept of life-time customers (the value of a
customer based on his/her buying potential and frequency of purchase) and
costs of customer acquisition are useful parameters for marketers to evaluate,
for acquiring and retaining customers. The RFM approach, which categorises
consumers based on how recently they had bought the brand, the frequency of
buying and the monetary value of purchase, is also useful in devising acqui-
sition and retention strategies. A firm may be interested in acquiring low-cost
consumers, who may offer high degrees of profitability (segmentation by prof-
itability) within a short span of time. But it should also be able to acquire other
segments like high-cost consumers, who may offer long term profits. Hence,
acquisition and retention strategies have to factor in the analysis of the busi-
ness environment and market situation associated with a product category.
The Need for Practice-oriented CRM Strategies

Though the concept of CRM has been clearly explained and there are sev-
eral associated strategies practiced by marketers, there is a need for practice-
oriented CRM strategies.
(a) There should be a CRM model to enable marketers formulate strategies
by which loyalty will lead to higher share of consumers.
(b) Calculating the life-time value of a customer and the period involved in
transacting profitable business with him/her in the retention phase are
complex issues. The probabilities used may not be realistic because of
dynamic, competitive conditions.
(c) Even though marketers practice several CRM-oriented strategies, they
may not know if they are targeting the right segment to build such a
relationship. Sometimes, loyalty programs may lead the flier company
into a “loyalty trap” if it does not have a clear cut method to identify
customers for such a relationship. Loyalty programs run the risk of erod-
ing the already slim margins in the case of super markets, as these are
forced to engage in loyalty wars.
(d) CRM works well when there is a large proportion of profitable consum-
ers under certain circumstances of profitability distribution. A number of
companies may have many customers contributing to profitability. The

belief that 20 percent customers contribute to 80 percent profits may not
be applicable to several buyer–seller relationships.
(e) Satisfaction may not lead to loyalty. Instead, it may put a company into
a “customer satisfaction trap” (CST). This means that the company falls
into the trap of gearing towards customer satisfaction, but eventually
fails to make profits while retaining loyal customers.
(f) Loyalty does not only depend on economic benefits to customers. Sus-
tainable retention comes from both economic and psychological benefits.
Hence, the need for a CRM dimension that is holistic and not concerned
purely with economic benefits.
This conceptual approach can enable marketers to explore several aspects

associated with satisfaction/loyalty through further research.
The Concept of Customer Mapping

The concept of customer mapping enables a company to “position” customers
on specific dimensions. This ensures that it enters into a relationship with the
right customers for a mutually profitable collaboration associated with CRM
concepts. Mapping also points out to categories of potential customers who
may be willing to join CRM programs.
There are two sets of dimensions to be considered for mapping custom-
ers. The first set of dimensions is customer satisfaction and customer loyalty.
Figure 13.3 shows the matrix.
This set measures the perceived value of functional and psychological
benefits like trust, feeling of security with the offering, belongingness, status
appeal etc., as appropriate to the positioning of the brand.
Figure 13.4 provides the CRM matrix conforming to the second set of
dimensions—intention to buy the brand and brand's share of the customer.
Customer
satisfaction
L
L Customer H
loyalty
Figure 13.3  CRM qualifier matrix

Intention to H
buy the
brand
L H
Brand’s share of the customer
Figure 13.4  Conformatory matrix
The second set of dimensions serves to reason out the “gap” that may exist
between customers expressing satisfaction with a brand, and those buying it
either infrequently or not at all. Further, the second set also attempts to explore
the degree of loyalty at a given point in time. For example, if a customer is cat-
egorized under “high satisfaction, high loyalty” cell and “low intention to buy
the brand and high share of the customer”, it indicates that the existing loyalty
is weak and that the company may have to take pre-emptive action (with an
appropriate marketing mix). The mapping of customers can be done after a
certain duration (one or two years, depending on the need and competitive
conditions in the category).
Categorization of Customers (Based on Mapping

and Strategic Implications)
Customer mapping results in four sets of customers:
1. Hardcore set
2. Potential set
3. Doubtful set
4. Transaction set
Each category should be dealt with using a different set of marketing mix
elements.
Hardcore set: This set of customers consists of the following subsets:
Subset 1 High satisfaction, high loyalty, high intention to buy the brand and
high share of the customer.
Subset 2 High satisfaction, high loyalty, high intention to buy the brand and
a low share of the customer.
Subset 3 High satisfaction, high loyalty, low intention to buy the brand and
a high share of the customer.
Subset 4 High satisfaction, high loyalty, low intention to buy the brand and
a low share of the customer.
There are implications for marketing mix strategies across subsets. All the
four subsets belong to the hardcore set because of their categorization under
high satisfaction and high loyalty (which is a strong indicator of further CRM
programs). Subset 1 has customers who qualify for a customer-centric CRM
program. For example, an apparel-making company can target customers
with several schemes specific to sustain the loyalty of this segment. Subset
2 is important because the customers in this subset are inclined to buy the
brand and the brand's share of their requirements is low. Hence, they should
be motivated to buy more of the brand so that the brand can progress signifi-
cantly in obtaining more of their share. The affordability level of the consumer
may be preventing him/her from increasing the brand's share of require-
ments. Pricing, or the overall value of the brand may have to be analyzed in
comparison with other competitive offerings. A new variant can be launched,
if necessary. Subsets 3 and 4 warn the marketer of an impending danger—the
hardcore customers who have been very loyal to the firm may shift to competi-
tive brands. They may feel that competing offerings of recent origin are better.
Potential set: This category consists of the following subsets:
Subset 1 High satisfaction, low loyalty, high intension to buy the brand and
Subset 2 High satisfaction, low loyalty, high intension to buy the brand and
low share of the customer.
Subset 3 High satisfaction, low loyalty, low intension to buy the brand and
Subset 4 High satisfaction, low loyalty, low intension to buy the brand and
low share of the customers.
This set deals with low loyalty in spite of a high degree of satisfaction.
But the subsets are classified under the potential set since the customers have
expressed a high level of satisfaction. Subset 1 presents an interesting situation
in which loyalty is low and the brand has a high share of the customer. This
clearly means that the customer is buying the brand but not out of great com-
mitment to it. In spite of high satisfaction, loyalty is low. At the same time, the
intention to buy is high. The customer is likely to switch if he/she has a choice.
In other words, the brand may be on its way out of the “choice set” of the con-
sumer—an indicator of weakening loyalty. The intention to buy the brand may
be high because of its low price or sales promotion, which naturally results in
a high share of the customer's requirement.
Subset 2 reflects a clear gap between the intention to purchase and the
final purchase. Point of purchase or pricing or promotional offers may have
to be fine-tuned in the marketing mix elements because the consumer has
expressed a high level of satisfaction and a high intention to buy. But his/her
non-affordability may be a problem. There is a gap between the high intention
to buy and repeat purchase. This causes low loyalty. It may be worthwhile to
explore if any brand dominates the customer's share of requirements and, if
so, why.
Subset 3 (which is associated with a high share of customer's requirement)
clearly reflects inertia purchase. The high satisfaction with regard to the brand
may also be associated with a competitive brand (an aspect that could be
probed by research.) While the customer has expressed a high degree of sat-
isfaction, the lack of loyalty and the low intention to buy it reveals that the
customer buys the brand without commitment to it. Lack of choice may be
another reason. The customer may put convenience (for instance, availability
in neighborhood stores or delivery of products like industrial consumables)
over product benefits/performance/quality. Competing brands can displace
the brand by “closing in” on appropriate dimensions.
Subset 4 presents a situation, which calls for immediate action after com-
paring the brand (on all aspects of the marketing mix) with other brands in the
“consideration set” of consumers. The high level of satisfaction may be associ-
ated with several brands.
The potential set is also likely to apply to several categories in which consum-
ers may not be able to perceive high or low satisfaction clearly because of ambi-
guity in the product benefit itself (shaving creams, fairness creams, soft-drinks,
shoe polish and industrial consumables like washing soaps are examples).
Doubtful set: This set comprises of the following subsets:
Subset 1 High loyalty, low satisfaction, high intention to buy the brand and
a high share of the customer's requirements.
Subset 2 High loyalty, low satisfaction, high intention to buy the brand and
a low share of the customer's requirements.
Subset 3 High loyalty, low satisfaction, low intention to buy the brand and a
Subset 4 High loyalty, low satisfaction, low intention to buy the brand and a
low share of the customer.
These belong to the doubtful set because of the spurious loyalty reflected
in the low levels of satisfaction. Several purchases in these sets may reflect
inertia rather than commitment to the brand. This may be due to the non-
availability of competing brands, or listlessness of the customer in making a
brand choice. High intention to buy (wherever reflected) may be due to brand
familiarity than any specific reasoning. Subset 1 points directly to inertia. The
high intention to buy in subset 2 may be due to the psychological implication
of the brand appeal (as this situation is associated with a low degree of satis-
faction resulting from the ambiguity involved in the evaluation of functional
benefits). Subsets 3 and 4 may also point out to inertia purchases.
This set is primarily associated with low satisfaction, and hence, further
research is required on
1. whether consumers have sufficient levels of involvement in buying these

products (specifically on functional benefits), and
2. whether brand familiarity provides the extrinsic cues (brand name and
packaging), influences purchase and why the cues fail to get translated
into a higher level of satisfaction.
If inertia purchases reveal that consumers buy a certain brand because of
non-availability of other brands, the company may have to quickly improve
the quality of the brand and also create consumer involvement through trial
purchases or appropriate campaigns. If this is not done, competitive brands
may attack the distribution front (availability aspects) and “take away” the
brand from the mindset of consumers. The doubtful set may occur in specific
geographical areas where there may be a few brands (familiar to the consum-
ers) competing with generic unbranded offerings. Besides, most offerings in
this situation may not offer the desired quality. Commodities like sugar, rice,
edible oil and snacks (especially in developing countries) may be categories
which may draw consumers from the doubtful set.
Transaction set: This set consists of subsets characterised by a low level

of satisfaction and loyalty. Hence the purchases may result from inertia. This
situation is likely to occur when consumers are highly price sensitive, and
there are several brands engaged in a price war (tin plate used for edible oil
packaging in India and low-end chemicals are examples). There is tremendous
opportunity in this situation to build a brand, create awareness about the
superiority of its benefits and ensure that consumers get involved in its
purchase. Intention to buy and share of the customer requirement may, in fact,
be fickle and fluctuating here.
The doubtful set and transaction set require marketing mix strategies to ensure
that consumers at least move into the potential set. In certain categories like low-
end chemicals, a company can even employ the state-of-the art technology (cus-
tomization, for example) to create involvement and pull together consumers, to
the potential set. For example, in a price-war situation, a chemical manufacturing
company may produce a washing solution that may be distinguished by its odor,
color or chemical properties, depending on the end application. This will create
a customer who can be associated with the potential, or even the hardcore set.
Implications of the Concept of Customer Mapping

 The concept attempts to qualify customers for a CRM program.
 It analyzes the gap between high satisfaction and low loyalty, with a
qualifier matrix.
 It enables marketers to review the process of measuring customer satis-
faction and loyalty with respect to appropriate dimensions. The concept
can be applied to several categories that involve frequent repeat pur-
chases (FMCG products or industrial consumables).
 The concept emphasizes that loyalty, in a number of situations, may be
inertia-oriented.
 The framework highlights the need to identify spurious (inertia driven)

loyalty when the company is planning a CRM program.
The marketing mix implication arising out of the different subsets is sug-
gestive, not exhaustive. The different subsets of the conceptual framework will
enable a marketer to qualify customers for relationship programs.
Touch of Reality
Expectations Matter
Brands convey expectations to consumers, and these matter to consumer
satisfaction as the consumer compares his/her expectations with the
actual performance of the offering. A higher priced detergent (priced
100 percent more than a lower priced one) should create a perception of
superiority in the minds of the consumers. The consumer has to perceive
a positive difference in the functionality of the product.
A chocolate or a brand of coffee repositioning itself as “improved”,
should convey a sensual taste that is better than its earlier version. The
3G version of iPhone (with several benefits including the GPS system that
will offer directions to locations) should offer a better experience to users,
as compared to the earlier version with all its features and benefits. It
is not that only functional performance results in expectations from the
offering. Several consumption situations can trigger symbolic expecta-
tions. A brand of music store that is able to download music may be able
to create an ambience that has a symbolic meaning to young consumers.
The differentiator in this context is the symbolism in the form of expecta-
tions of the target segment. The same store may have to use a retro-appeal
to attract consumers who are over the age of 60 to convey their expecta-
tions on the service rendered. Expectations are consumers' beliefs about
what the brand offers, and a brand has to realistically convey its propos-
ition. A brand in the area of mobile service advertising about its reach and
clarity has to necessarily ensure that the expectations are met by its infra-
structure. Consumers also get used to expectations at several price points,
as a category evolves. In the automobile sector, among passenger cars
there are clear cut segments based on price points (though they are get-
ting cluttered across segments). Consumers have their expectations about
offerings in a specific price range. For example, higher-end cars may have
a GPS that is able to provide directions to the driver about the locations
in the respective city and consumers may expect ease of use with such
a feature/system. New variants introduced in the market also modify
and change the expectations of consumers. Even in the simple category
of gum used as part of stationery, the introduction of bottles with small
openings for ease of usage and the easy-to-use tube version (Fevistick)
have changed the perception of gum usage among consumers.
Readings
Research streams can be classified into two significant categories—knowledge creation and
application-based research. Both these categories are important in marketing and related
aspects, and these would be of interest to the target segment of readers, especially when it
comprises of postgraduate students and practicing managers. Research, when applied to
a specific framework, enables readers to connect with the context and motivates them to
explore several related dimensions. The Indian context is an emerging market and poses
challenges that are significantly different from those of the developed markets. The research
readings provided in this part capture some of the topical issues associated with the Indian
context. The issues discussed in the readings are cultural values and brand associations,
degrees of brand loyalty, culture and multinational brands, the importance of expansion
advertising, linkages between brand personality and brand loyalty, and the importance of
point of purchase.
1
Factors Affecting Brand Loyalty: A

Study in an Emerging Market on
Fast Moving Consumer Goods*
S. Ramesh Kumar and Jai Yashwant Advani
Indian Institute of Management Bangalore
Brand loyalty is a topic of interest both to academicians and practitioners of marketing. The
concept of relationship marketing has its underpinnings in brand loyalty. In consumer prod-
ucts, typically fast moving consumer goods (FMCG), there are a host of complexities that
affect brand loyalty. The very concept of loyalty seems to have become a dynamic one with
the marketing literature presenting different aspects of the concept. This study examines
the combined effects of brand benefits, brand symbolism, brand trust, genetic influence and
price consciousness of consumers on brand loyalty for the toothpaste product category. Data
from a random sample of 444 consumers in India confirm significant influence of brand
functional benefits, brand trust, price consciousness, and genetic influence on brand loy-
alty. Results suggest that marketers would have to balance the traditional axiomatic views
of brand loyalty with the emerging dimensions of brand migration in a competitive context.
This research paper explores factors closely related to the management of brand loyalty, and
could offer insights to practitioners of marketing. It also offers a framework that reflects the
implications of the study to marketing practice with regard to management of brand loyalty.
Keywords: brand loyalty, brand trust, brand symbolism, brand benefits, emerging brands
Introduction
Brand loyalty is a topical managerial issue in fast moving consumer goods
(FMCG) in several markets around the world. The top 16 retailers in Europe
*
This reading was first published as Ramesh Kumar S., and Jai Yashwant Advani (2005), “Factors affect-
ing Brand Loyalty: A study in an emerging market on fast moving consumer goods”, Journal of Customer
Behaviour, 4, 251–275. Reproduced with permission.
together spent more than $1 billion in 2000 on loyalty initiatives (Werner and
Kumar, 2002). While companies spend huge amount of money on loyalty pro-
grams, a variety of factors can generate false loyalty or make customers seem
deeply loyal when they are not loyal to the brand ( Jones and Sasser Jr, 1995).
Consumers in FMCG categories also show a marked level of price-conscious-
ness. Highly loyal buyers in a product category have virtually disappeared
from the brand franchise, falling from 10 to 5 percent of the category of heavy
buyers of the brand (Hallberg, 1995). Loyalty is won through delivery of super-
ior customer experience (Reichheld and Schefter, 2000). The symbolic aspects
of branding could also influence brand loyalty (Kumar, 2001). This research
study attempts to investigate brand loyalty and its related dimensions, namely,
brand functional benefits, brand trust, price consciousness, brand symbolism
and genetic influence of brand selection on brand loyalty. The purpose of the
research is to add a contemporary dimension to brand loyalty, especially in a
developing market using traditional and emerging factors associated with the
literature on brand loyalty.
Research on Brand Loyalty

A major objective of any marketing strategy for most product categories is
the facilitation of consumers to repurchase the brand through preference or
involvement. Therefore, the topic of repeat purchase or brand loyalty has re-
ceived considerable attention, both from academicians and practitioners. Brand
loyalty refers to the consumer's behaviour of repeatedly purchasing a specific
brand over a certain period of time. This is based on the past behaviour and
the brand-loyal consumer is likely to purchase the products of a specific brand
currently and in the future (Lin, Wu and Wang, 2000). However, a debate that
has been going on in this field since the seventies is whether brand loyalty
involves more than a behavioural measure of repurchase (Day, 1969). There-
fore, researchers have focused on another dimension of brand loyalty, namely,
attitudinal loyalty (Werner and Kumar, 2002). This debate has not reached any
consensus, but the fact remains that brand loyalty is believed to be a powerful
tool to combat increasing competition in the marketplace (Amine, 1998).
Brand loyalty is important for marketers because it helps in retaining cus-
tomers. Often, retaining customers requires less marketing resources than
acquiring new ones (Reichheld and Sasser, 1990). It also has positive implica-
tions on brand equity (Aaker, 1991; Uncles and Laurent, 1997; Chaudhri, 1999).
The purchase behaviour of consumers is greatly influenced by increasing com-
petition reflected in the proliferation of brands in the packaged product cat-
egories, and in the consumer's thirst for variety (Choong, 1998). Further, it has
also been pointed out that not all consumers are created equal (Hallberg, 1995)
and that their relationships with brands are also not alike, either in strength or
character (Fournier and Yao, 1997). The concept of “Double Jeopardy” advo-
cated that smaller brands have lesser market share and also have fewer con-
sumers loyal to them, as compared to larger brands that have higher market
Factors Affecting Brand Loyalty 373
shares and higher degrees of brand loyalty (Ehenberg, Goodhardt and Bar-
wise, 1990). This effect may be very applicable to emerging markets because
there may be a number of smaller brands. It is therefore important to under-
stand factors influencing brand loyalty of consumers so that marketers can
accordingly formulate the marketing mix of their brands to target appropriate
segments. This study is an attempt to understand the key factors influencing
brand loyalty in a changing environment.
A number of studies have focused on understanding the concept of brand
loyalty and the factors influencing it. Product attributes, after sales service/
usage, marketing capabilities, perceived quality/aesthetics, depth of product-
line and brand popularity are key differentiating factors influencing the behav-
iour of repeat purchasers and brand switchers in case of consumer durables
(Lin, Wu and Wang, 2000). Studies have also found that brand commitment
is a necessary condition for true brand loyalty to occur (Bloemer and Kasper,
1995; Amine, 1998). This was supported by the findings of Knox and Walker
(2001), wherein they found that a number of factors like packaging, new prod-
uct trial, price, store location, product quality/features, vouchers, free gift,
variety, children's influence and advertisements discriminate switching moti-
vations of heterogeneous consumer segments like brand loyals, habitual loy-
als, variety seekers and switchers. Consumers' demographic characteristics
like age and household income are also associated with high levels of brand
loyalty (East, Gill, Hammond and Hammond, 1995). The study also found that
brand loyal consumers are more concerned with quality than price, and that
they are heavy spenders, slightly more loyal to the store.
Brand loyalty is also influenced by market structure (Lin, Wu and Wang
2000; Sharyn and Rebekah 2001), positioning and marketing mix strategies
(Bhattacharya, 1997). It was also found that brands which cater to niche mar-
kets are bought in higher quantities, have lower prices, are promoted to a
lesser extent, have shallower price cuts and enjoy more than expected loy-
alty levels. Recently, Knox and Walker (2003), found a weak but significant
relationship between level of involvement and brand loyalty in the grocery
market. Further, it is also recommended that while brands explore the possi-
bility of tapping the benefits of retail environment, they should fully exploit
the ability to communicate with all the senses, with special focus on sonic
branding, which can be a powerful tool in the development of brand loyalty
(Fulberg, 2003).
While several factors influencing brand loyalty have been studied in
the extant literature, the authors opine that brand loyalty has to be studied
from the viewpoint of certain recent developments in academic research
without losing the useful insights gained from traditional research studies.
This study therefore attempts to investigate empirically the influence of
key factors viz., brand functional benefits, price consciousness, brand trust,
brand symbolism and genetic influence on brand loyalty. These factors
represent traditional and emerging dimensions influencing brand loyalty,
and could help practitioners of marketing in designing suitable marketing
strategies.
Importance of Research Issues

Brand loyalty has been researched for the last several decades. As discussed in
the literature survey, the traditional aspects of loyalty are undergoing a change
in a changing environment. Researching any aspect of marketing, especially a
concept like brand loyalty, which is topical and contextual, requires exploring
a new dimension associated with it. The authors have attempted this aspect
in this research study. Researching the basic aspects and moving into recent
developments is a well-accepted practice in research (Baker, 2000). This paper
makes an attempt to explore certain topical aspects of the concept in an emerg-
ing market. Recent literature on the concept suggests that brand loyalty could
be an offshoot of attachment towards the brand and consumers could develop
attachment towards a brand on a number of counts. These aspects associated
with the brand relationship could be hedonism, personal gratification, self
image, pleasure of the relationship, development of consumer's family and
the brand's association with people with whom the consumer has emotional
connections (Kapferer, 2004). This study attempts to provide some of the di-
mensions in the backdrop of brand loyalty.
Another aspect of the research, warrants a study of this nature is that in the
developing markets such studies on brand loyalty have not been published
and this would be an opportunity to address issues, which are not only rele-
vant for academic research but which could also be useful to practitioners of
marketing. The Indian context is witnessing the entry of multinational brands
in the fast moving consumer goods categories. In the category of toothpastes
for example, LG, the Korean company, is a new entrant while SmithKline Bee-
cham launched its Aquafresh a few years back.
Other multinationals like Proctor & Gamble (which also launched a num-
ber of its global brands in India in the detergent category) may also launch its
brands in India. This dimension of competition is a marked part of the sce-
nario in an emerging market like India.
What is more interesting and distinguishing about the Indian market is that
apart from competition from multinational brands, there is a huge unorgan-
ized market in the country, in a number of categories. An unorganized market
is one, which caters to the local market in terms of geographical boundaries,
has an offering which may be slightly sub-standard in terms of quality, uses
small “pop and mom” shops for distribution and uses unconventional adver-
tising like wall painting (advertisements of the offering may be painted on the
walls of buildings). These offerings, priced much below the branded offerings,
appeal to the masses who use them before they upgrade to branded offerings
over a period of time, as their purchasing power gets enhanced. These markets
may be found in categories like biscuits, detergents, footwear, tea, edible oil,
hair oil, cassettes and mineral water.
Besides multinational brands and the unorganized market, there have
been a new breed of brands, which could be referred to as regional brands
and these brands have been giving the larger brands a difficult time in the
market at the lower end. In the category of toothpastes, Anchor is a brand,

which is posing a threat to a brand like Colgate. Tea, detergents, edible oil,
coffee, watches, men's apparel, toilet soaps and fast food are some of the other
categories in which regional brands have started making their presence in a
significant manner. The regional brands (distributed in a much wider geo-
graphical area than a typical offering from the unorganized sector) offer a
quality that could be comparable to that offered by multinational brands,
advertise in conventional media, though selectively within the region of their
operations and use the distribution channels that are used by large brands.
They are priced below the multinational brand but a bit above the unorgan-
ized offerings. The challenge of the marketer of a strongly entrenched brand
and a regional brand is to upgrade the consumer from the unorganized sector
and also to build loyalty in a variety of ways. Hence, apart from the topical-
ity of the concept, brand loyalty, in an emerging market, could have a pro-
found impact on practice-oriented strategies, which are focused on loyalty
and repeat purchase.
The study attempts to work around a traditional set of dimensions asso-
ciated with brand loyalty (functional benefits and price consciousness) and
combine them with contemporary developments in brand loyalty (symbolism,
brand trust and genetic influence). The objective of the study is to address aca-
demic issues that also have practical significance in the management of loyalty
in packaged product categories, which are strongly prone to brand switching
due to price sensitivity and sales promotion. The study also takes into con-
sideration the shifting of brand proposition in consumer product categories,
where brands make an attempt to create a bonding with emotional and self-
concept oriented appeals. The aim of the study was to study the mix of issues
associated with brand loyalty and to provide a framework for marketers, who
would be able to derive insights from the framework to retain consumers in
the respective categories.
Hypotheses Development
It has long been emphasised (Sheth and Whan, 1974) that product attributes
have a significant influence on brand loyalty. In fact the messages to which
consumers are exposed, often stress product benefits (Green and Jain, 1972).
The attributes of the brand have been considered as necessary for consumers
to like the brand and purchase it repeatedly (Lin, Wu and Wang, 2000; Knox
and Walker, 2001). It is therefore expected that if consumers get certain func-
tional benefits from a brand, they are likely to be more loyal to that brand. We
therefore hypothesise that:
H1: Brand functional benefits are positively related to brand loyalty.
Price consciousness is defined as the degree to which the consumer focuses
exclusively on paying a low price (Lichtenstein, Ridgway and Netemeyer,
1993). A price-conscious consumer is more concerned with price, seeks out

lower price, and sees such a search as worthwhile (Monroe, 1990). Several
studies (Rothschild, 1987; Raju, Srinivasan and Lal, 1990) have found price
promotion to be negatively related to brand loyalty. It has been found that
highly price-conscious consumers look for better price and have lower buying
intentions (Krishnamurihi and Raj, 1991; Alford and Biswas, 2002). Therefore,
it is expected that consumers who continuously look for price before purchas-
ing a brand will not purchase the same brand repeatedly until the brand is
offered at the cheapest price continuously vis-à-vis other competitive brands
in the market. Most of the brands in the marketplace introduce discounts/
sales promotion on a regular basis in most fast moving consumer categories,
and price conscious consumers will keep switching brands continuously, as
and when the brand is offered on sale (Reichheld, 1996). It is therefore hypoth-
esised that:
H2: Consumer’s price consciousness will have a negative relationship with brand
loyalty.
Past research (Doney and Canon, 1997) has proposed that brand trust is a
calculative process based on the ability of the object (brand) to continuously
meet its obligations, and on an estimation of the costs versus rewards of staying
in the relationship. We adopt a more recent definition of brand trust adopted
by Elena, Jose and Maria (2003), wherein brand trust is defined as “the confi-
dent expectations of the brand's reliability and intentions in situations entail-
ing risk to the customer”. We adopt this definition because we feel that trust is
based not just on cost estimation but also the confidence a consumer has in a
brand. This definition has been conceptualised by considering literature from
social psychology, sociology, management and marketing, which supports our
view of brand trust. We propose that brand trust positively influences brand
loyalty as has been suggested in previous research (Moorman, Zaltman and
Despande, 1993; Morgan and Hunt, 1994; Chaudhari and Holbrook, 2001).
This is because high confidence or trust in a brand will help customers to
reduce perceived risk and facilitate in purchasing the brand repeatedly. There-
fore, consumers who have high trust in the brand will purchase it repeatedly.
Based on the discussion, it is hypothesised that:
H3: Brand trust is positively related to brand loyalty.
Brands have been considered important in creating individual identity
related to consumers' psychological needs (O'Cass and Frost, 2002) associated
with status, exclusivity and prestige (Eastman, Goldsmith and Flynn, 1999). It
has also been found that (Bhat and Reddy, 1998) marketers do not necessarily
have to position a brand as a prestige brand with its associations of expensive-
ness and exclusivity to tap the symbolic needs of the customer. One way to
approach a brand's marketing strategy is to investigate if symbolism could be
used to nurture brand loyalty. A marketing strategy that shows how the brand
can be used to express a consumer's personality is an effective strategy for
influencing the customer to exhibit loyalty towards the brand. We propose to

investigate the influence of brand symbolism as reflected by the self-concept
of consumers. We propose a positive relationship between brand symbolism
and brand loyalty. In an emerging market like India, consumers in a changing
context, full of lifestyle orientation, could use a brand for expressing their per-
sonality or self-concept, and hence, are more likely to be loyal to the brand. It
is therefore hypothesised that:
H4: Brand symbolism is positively related to brand loyalty.
Several studies (Mooray-Shay and Lutz, 1989; Olsen, 1993; Elizabeth,
William and Richard, 2002) have identified intergenerational influence or lin-
eage as a key factor influencing brand loyalty. This forms part of the reference
group appeal on consumer purchase behaviour. Reference group influence on
the purchase behaviour of a consumer can be from friends, colleagues, peer
group, family etc. This study proposes that intergenerational influence or gen-
etic influence can be a key factor influencing brand loyalty. This is because
consumer socialisation research emphasises that adult consumer habits are
formulated during childhood (Carlson, Grossbart and Walsh, 1990) and dur-
ing adolescence (Bahn, 1986). Therefore, reference groups could influence
childhood preferences in an environment where choices are not available, and
hence, may have had an impact on brand loyalty. It is therefore expected that
consumer preferences are formed towards certain brands early in childhood
and result in adult loyalty. This is especially relevant in a market scenario like
that of the Indian market where there were only a few brands before the mar-
kets were opened up for competition about fifteen years ago. It is therefore
hypothesised that:
H5: Genetic influence is positively related to brand loyalty.
Pioneering brands may have dominated the market for several decades
in an emerging market like India, which has been experiencing open econ-
omy for over just a decade. Colgate, in the toothpaste market, is an example.
While most fast moving consumer good categories have several brands offer-
ing a choice to consumers, the authors opine that genetic influence on brand
loyalty is an important aspect that needs to be considered in brand loyalty
research.
Research Methodology
Product Category Selection Criterion
The authors decided to probe brand loyalty and its related dimensions in the
category of toothpaste for the following reasons:
a. The product category has been in the market for several decades and
consumers would have no problem in understanding the product, as
they were familiar with the category. This was essential to ensure that
consumers would be able to appreciate and discriminate between brands

in the category, and express loyalty and the intrinsic differences between
brands based on the core function of the category.
b. Toothpaste category has brands like Colgate, Close-up, Vicco and
Forhans, which have been in the market for several decades, and the as-
pect of genetic influence could be considered.
c. Toothpaste is a category, which has therapeutic and cosmetic brands,
and hence, offers scope for investigating functional and symbolic ben-
efits. For example, Close-up is a brand, which was predominantly posi-
tioned and nurtured as a lifestyle brand, with symbolism being the main
driver of the brand. Colgate Fresh Energy Gel is another brand created
on these lines.
d. Given the nature of the toothpaste category, the entry of a number of
brands in recent times (especially after liberalisation) and high decibel
advertising of brands, there is a strong possibility that consumers may
have tried out several brands over a period of time and would be in a
position to express their loyalty in the category in discerning ways.
e. Toothpaste is also a category where there is frequent sales promotion of
brands, and consumers have an opportunity to try out different brands.
There are also different brands at price points which are close even
within a specific price band. Advertising also enhances trials among con-
sumers. The category of toothpastes not only offers scope to test out and
research the dimensions identified, but also offers a backdrop for brand
switching. This aspect makes the category of toothpaste very suitable
for research on contemporary brand loyalty. Further, the dimensions re-
searched may also be applicable to several other categories of fast mov-
ing goods.
Questionnaire Design, Pre-Testing and Final

Administration
The questionnaire was constructed in simple language reflecting the various
aspects of brand loyalty to ensure that respondents would not have problems
understanding the kind of responses expected from them. Though the respon-
dents chosen were familiar with the product category, in the context of the
research conducted, consumers do not frequently fill in questionnaires and
hence may not understand a complex questionnaire. Besides, it was also neces-
sary to make the list of questions short without sacrificing the content required,
to ensure that respondents provide a feedback. Long questionnaires generally
result in low return rates. The sequence of the questions was selected based
on consumer familiarity of brand loyalty dimensions. For example, price as
a factor affecting repeat purchase is relatively easier for respondents to com-
prehend (than probably brand trust). The dimensions they may be relatively
familiar with, namely price and functional benefit aspects, were listed in the
first phase of the questionnaire. After this sequence, which would have kin-
dled their initial interest, they were exposed to dimensions of repeat purchase,
which would have made them think about their repeat purchase behaviour.
The complex aspects of brand loyalty, namely brand trust and genetic influ-
ence on brand loyalty, were covered later, after the repeat purchase aspects.
The sequence of the questions was designed to progress from simple to com-
plex aspects involved in the research, with the introduction of repeat purchase
in the middle to enable the respondents to think about their repurchase after
going through some of its simpler dimensions.
Based on the dimensions identified in the literature and the hypotheses that
were proposed subsequently, a questionnaire was formulated using the scales
available in the literature to collect data from a large number of respondents.
The questionnaire was pre-tested on a random sample of forty consumers who
represented the target respondents for the final questionnaire. The sample had
various kinds of consumers viz. male, female, married, unmarried, student,
employed, and self-employed.
Brand symbolism, brand trust, price consciousness, brand functional ben-
efits, genetic influence and brand loyalty were measured using multi-item
five-point Likert scale. Price consciousness was measured using a three-
item scale developed by Lichtenstein, Bloch and Black (1988). Brand trust
was measured using a four-item scale and was adopted from Chaudhuri
and Holbrook (2001). Brand loyalty was measured using a four-item scale
( Jacoby and Chestnut, 1978) consisting of purchase loyalty and attitudinal
loyalty. No scale for brand functional benefits is available in the literature,
and it was also found difficult to develop a general scale of brand benefits,
which would be applicable to all FMCG product categories. Therefore, a six-
item scale for brand functional benefits was developed specifically for this
particular study based on inputs from personal interviewing of consumers.
A three-item brand symbolism scale was adopted after minor modification of
different scales of brand symbolism, product sign and brand sign from Bhat
and Reddy (1998), and Knox and Walker (2001). A two-item genetic influ-
ence measure was developed for this study based on personal interviewing
of consumers. Although most of the scales were adopted directly from the
literature, except brand functional benefits and genetic influence, some of the
items from existing scales were modified based on the inputs after pretesting
of the questionnaire on a sample of 40 consumers. The final items used in
the questionnaire are provided in the Appendix. The hypotheses generated
above were tested on a random sample of 444 customers from a metropoli-
tan city in India. The mean age of the sample respondents was 27 years and
standard deviation was 9 years. Table 1.1 shows other demographic charac-
teristics of the sample respondents.
The questionnaire was administered in the field through an investiga-
tor, who explained any doubts the respondents may have had with regard
to the items mentioned in the questionnaire. The questionnaire was col-
lected back by the field investigator after the respondents had filled in the
responses.
Table 1.1  Sample Demographics
Percentage
Gender Male 70
Female 30
Marital Status Married 30
Unmarried 70
Occupation Working Professional 41.4
Own Business 13.7
Student 27.4
House Wife 17.6
Analysis and Discussion

A single factor analysis (Table 1.2) confirmed the underlying structure of the
measurement items. Six factors were extracted from factor analysis, explaining
62% of variation in the variables. Most of the items loaded on to the respective
factors were as expected. The overall score for each variable was summate of
the respective weighted items from factor analysis.
Table 1.2  Factor Analysis
Extraction method: Principal Component Analysis

KMO measure of sampling adequacy = 0.791
Bartlett's test of sphericity. sig.= 0.000
Cumulative variation explained by the six factors = 62.26%.
Total Variance Explained
Initial
Component Eigenvalues
Total % of Variance Cumulative %
1 5.18 23.53 23.53
2 2.28 10.35 33.88
3 1.91 8.68 42.56
4 1.69 7.66 50.22
5 1.44 6.53 56.75
6 1.21 5.51 62.26

Factor Loadings
1. Price Consciousness
I usually buy toothpaste, which is on sale. −0.10 −0.01 −0.01 0.12 0.75 0.04
I buy the lowest-priced toothpaste that suits

my needs. −0.12 −0.10 0.03 0.04 0.75 −0.02
When it comes to choosing toothpaste for

me, I rely heavily on price. 0.00 −0.03 0.00 −0.07 0.81 0.03
2. Brand Functional Benefits
I feel that use of my regular brand of

toothpaste provides me freshness throughout
the day. 0.19 0.72 0.10 −0.02 −0.03 −0.04
I feel that prolonged use of my regular brand

of toothpaste would prevent tooth decay. 0.14 0.71 0.08 0.25 −0.11 0.06
Use of my regular brand of toothpaste gives

me a refreshing taste. 0.21 0.75 0.01 −0.12 −0.02 −0.01

of toothpaste helps in cavity protection. 0.01 0.72 0.04 0.23 −0.12 0.16

of toothpaste helps in whitening teeth. 0.01 0.68 0.21 0.15 0.01 0.04

of toothpaste helps in gum protection. 0.08 0.63 0.07 0.38 0.03 0.03
3. Brand Loyalty
I will buy my regular brand of toothpaste, the

next time I purchase toothpaste. 0.75 0.22 −0.11 0.10 −0.05 0.01
I intend to keep purchasing my regular brand

of toothpaste. 0.74 0.32 −0.14 0.13 −0.12 0.01
I am committed to my regular brand of

toothpaste. 0.76 0.09 0.14 0.18 −0.04 0.11
I would be willing to pay a higher price for my

regular brand of toothpaste, over other brands. 0.70 −0.04 0.24 0.04 −0.09 0.04
4. Brand Trust
I trust my regular brand of toothpaste for my

tooth-related problems. 0.16 0.39 0.02 0.68 0.04 0.01
I am likely to use my regular brand

of toothpaste even if there is a scam
surrounding it. 0.05 −0.01 0.08 0.55 0.06 0.08
I rely on my regular brand of toothpaste for

my tooth-related problems. 0.09 0.13 0.07 0.80 −0.01 −0.14
(Continued )
Factor Loadings (Continued )
My regular brand of toothpaste is a reliable

brand. 0.35 0.30 −0.16 0.49 −0.02 0.04
5. Brand Symbolism
Using my regular brand of toothpaste helps

me express my personality. 0.10 0.36 0.69 −0.08 −0.02 0.05
Knowing whether a person uses my regular

brand of toothpaste or not tells a lot about
that person. 0.04 0.08 0.86 0.09 0.03 0.09
One can tell a lot about a person from the

brand of toothpaste he/she buys. 0.00 0.04 0.83 0.11 0.01 0.09
6. Genetic Influence
My regular brand of toothpaste is the same

as what my parents had used for many years. 0.08 0.06 0.09 0.02 0.01 0.89
My regular brand of toothpaste is the one I

had used since my childhood. 0.05 0.07 0.11 −0.03 0.04 0.88
Reliability coefficients (Cronbach's α) for all the measures were high and
appropriate for research purpose. The reliability values for all the variables are
shown in Table 1.3.
Table 1.3  Reliability Values
Variable Reliability (Cronbach’s )
Brand symbolism 0.754
Brand trust 0.650
Brand benefits 0.842
Price consciousness 0.668
Brand loyalty 0.780
Genetic influence 0.782
A pair-wise correlation matrix was prepared to examine the multicollinear-

ity, and to ensure that there is no significant overlap among the predictor vari-
ables (Table 1.4). Intercorrelations indicate only a minor level of multicollinearity
among these variables. In general, correlations in the matrix indicate a relative
independence or little overlap among variables. Further, the correlation matrix
indicates significant positive effects of brand benefits, brand trust, brand sym-
bolism and genetic influence on brand loyalty and negative effects of the con-
sumer's price consciousness.
Table 1.4  Correlation Matrix
1 2 3 4 5 6
Brand loyalty (1) 1
Brand benefits (2) 0.415** 1
Brand symbolism (3) 0.125** 0.271** 1
Brand trust (4) 0.369** 0.456** 0.148** 1
Price consciousness (5) −0.163** −0.110* 0.011 0.011 1
Genetic influence (6) 0.175** 0.167** 0.224 0.055 0.035 1
* Correlation is significant at the 0.05 level (2-tailed).

** Correlation is significant at the 0.01 level (2-tailed).
Next, regression analysis was performed to examine the relative influence

of price consciousness, brand trust, brand symbolism, genetic influence and
brand benefits on brand loyalty (Table 1.5). The results show that predictor fac-
tors viz. price consciousness, brand benefits, brand symbolism, genetic influ-
ence and brand trust, explain 19.8% of variation in brand loyalty. The value
of condition index (16.636) also indicates that there is no serious problem of
multicollinearity in the predictor variables, although a moderate correlation is
found between brand benefits and brand trust.
Table 1.5  Regression Analysis
Beta Std. T-value Sig.
Price consciousness −0.166 −3.747 0.000
Brand benefits 0.217 4.227 0.000
Brand symbolism 0.019 0.412 0.681
Brand trust 0.242 4.922 0.000
Genetic influence 0.100 2.209 0.028
Dependent Variable: Brand Loyalty
Adj R2 0.198
F-statistic 21.644
Sig 0.000
Condition index 16.636

It is found that brand trust and brand benefits are relatively more signifi-
cant in influencing brand loyalty than other predictor variables. Further, price
consciousness is negatively related to brand loyalty. Results are supportive of
the hypothesis, which maintains that a high degree of consumer's price con-
sciousness will have an adverse influence on brand loyalty. Consistent with
the earlier discussion, the results also indicate that brand benefits and brand
trust are effective in influencing brand loyalty. Also, genetic influence is posi-
tively related to brand loyalty. However, the results show that brand symbol-
ism does not seem to affect brand loyalty. This may be due to the fact that
consumers consider brand benefits more significant than the associations in a
product category like toothpaste. However, it is possible that brand symbol-
ism may be a significant predictor of brand loyalty in other FMCG product
categories like soap, deodorants etc., where consumers associate a brand with
their self-concept or reference groups more than in case of a product category
like toothpaste.
As indicated by the results, consumers perceive brand functional benefits
and brand trust to influence brand loyalty. Thus, it could perhaps be inter-
preted that consumers, given their familiarity with the category and based on
their experience in buying several brands over a period of time, are discerning
enough to maintain that functional benefits are required to keep the brand
under consideration for repeat purchase, even when they have opportunities
to try out new brands. The consumers may be motivated to try out new brands
either due to sales promotion or due to symbolic proposition of brands, or even
when there is an overtone of genetic influence on brand selection. There is
also strong support to reflect that consumers' loyalty will be sustained through
brand trust if a brand is able to create a loyalty, which would inspire trust with
regard to the brand over a period of time. This indicates that besides func-
tional benefits, trust may be dependent on how authentic the brand commu-
nication will be about conveying functional benefits (as they are core to brand
loyalty), and how the brand is able to handle complaints through its grievance
redressing systems. This interpretation may be unique to a country like India
where service levels, in general, will have to be enhanced to greater levels in
both product and service categories. With the growing development of the
toothpaste category, brands may benefit by paying attention to consumer dis-
satisfaction, and perhaps a point of purchase grievance handling/ complaint
system may be one of the ways to build brand trust over a period of time.
Another dimension, which is contextual, is the availability of “look-alikes”
(duplicate brands, which are illegitimate) in the country. Several categories
in fast moving consumer goods are plagued by duplicate “brands” that look
almost similar in packaging, to the brands they are attempting to clone.
Multinational companies have come together to address this problem.
A brand's ability to create and nurture problems associated with the basic
trust associated with it (including actions to prevent forces from diluting and
destroying it) is important, and the results of the study help in the interpret-
ation of such contextual problems. The weak association of symbolism to loy-
alty can perhaps be explained by the fact that this symbolism is being diluted
by a proliferation of brands in fast moving consumer goods categories. This

would mean that the symbolism associated with the category (toothpaste
in this context) might be adding value only if functional benefits are being
updated. For example a brand, which has been associated with lifestyle sym-
bolism ever since its launch, would be preferred only if functional benefits are
updated either in its original product delivery form or in its variants launched
subsequently. The Close-up brand of toothpaste, which has been positioned
on symbolism, may have to launch (in the competitive context) whitener strips
(which could whiten the teeth within minutes) to substantiate the “romantic
symbolism” associated with its positioning.
Implications of the Study to Marketing

Practice—Developing a Framework for
Contemporary Brand Loyalty
The study established that the concept of loyalty is expressed in terms of their
linkages with brand benefits, brand trust, genetic influence, and brand price
consciousness. The study also probed into the significance of brand benefits,
brand trust, price consciousness, symbolism and genetic influence of brand
selection, on brand loyalty. These factors were found to have varying degrees
of influence on brand loyalty.
Loyalty is an important and topical marketing issue. The linkages of loy-
alty with the factors studied become important to avoid mismanagement
of loyalty and to ensure that loyalty management programs are not wasted
through indiscriminate sales promotion. Brand associations form an import-
ant aspect of branding. In an environment full of advertising clutter, managing
brand associations is important. There is a need to manage brand associations
in a manner that would appeal to consumers with different degrees of loyalty
to the brand, and at the same time ensure that consistency of brand associa-
tions is maintained. Several brands in FMCG categories build themselves with
symbolism (linked to self-concept or reference group aspects). The impact of
symbolism on brand loyalty poses interesting challenges to marketers. Finally
a framework that involves “brand benefit set” (involving a brand's functional
benefits and trust) and loyalty that could be used by marketers to explore sev-
eral marketing strategies is suggested.
The framework shown in Figure 1.1 involves two dimensions: “brand bene-
fit set” (concerned with the brand's functional benefits and brand trust) and
brand loyalty. This would give rise to four different categories of consumers
who could be approached through different kinds of marketing strategies (as
appropriate to FMCG categories).
“Brand benefit set” means brand benefits and brand trust. While price
consciousness may have an impact on loyalty, a consumer who perceives
a brand high on “brand benefit set”, may exhibit less price consciousness.
Consumers who could be categorised as “high” on “brand benefit set” and
Brand
Loyalty
Low High
High ‘MYSTERY’ ‘VITALS’
Brand
Benefit Set
Low ‘FLOATERS’ ‘SHAKERS’
Figure 1.1  Developing Contemporary Brand Loyalty – A Framework
loyalty are Vitals. These consumers are the core consumers of the brand and
they not only perceive the brand “high” on benefits but also feel that they
could rely on the brand even when the brand is going through a troubled
phase. A brand should reward such consumers and reinforce the goodwill
that they have in the brand. A database of such consumers with specific cri-
teria endorsing their high degree of loyalty should enable the company to
plan promotional programs for such consumers. Besides specific discounts
on the brand (clearly communicating that the benefit is a result of their loy-
alty), frequent updates on the brand and its benefits could hold the involve-
ment of these consumers.
For example, a leading brand could offer its new variant exclusively for
these consumers during the initial period of launch. The brand could also
update the consumers on efforts taken by the company to improve its offer-
ings. Depending on the type of brand association/positioning, innovative sales
promotions that enhance the perception of these consumers on brand benefits
could be formulated. For example, a brand like Colgate Total positioned on
functional attributes (with a premium price) could offer dental check-ups (as a
sales promotional effort) with a leading dentist in a specific town/city. Besides
being rewarded, consumers would also have an enhanced perception about
the “protection” promised by the brand.
One should also examine the “brand benefit set” of a brand from the view-
point of consumers. Trust is built up over a period of time and sales promotion
of the kind mentioned earlier is likely to contribute to brand trust. Updates
on scientific reports regarding the effectiveness of the brand in comparison to
the functional attributes of competitive brands are also likely to contribute to
brand trust.
Consumers who are “high” on loyalty but “low” on “Brand benefit set”
(Shakers) are probably expressing inertia loyalty. This consumer group either
feels that the purchase is not very important, or they have not had the motiv-
ation to realign their decision making process to change their brand despite con-
sciously knowing that they perceive the brand to be low on “Brand benefit set”.
It may be worthwhile to probe into the psychographics of this group. The lower
significance of symbolism associated with loyalty in the sample may be asso-
ciated with this group of consumers. It is possible that they have internalised
the brand association (if the brand is positioned on symbolism like Close-up)
to the extent of exhibiting high loyalty. Unless such a conclusion is derived,
consumers in this group exhibit inertia loyalty. If symbolism is responsible for
high loyalty, the brand should enhance its visibility (in an appropriate man-
ner) in this group to retain its “brand benefit set”. While brand benefits could
be portrayed through marketing communication, brand trust can only be built
up by emphasising the credibility of the brand over time. Instead of sales pro-
motions (like the one suggested for Vitals), contests involving brand benefits
may be useful to influence this consumer group. Contests involving product
attributes/ benefits could be formulated and this approach would also influ-
ence the “word of mouth” among the group or the brand. Shakers, who appar-
ently exhibit a high loyalty, can threaten the consumer base of the brand if their
numbers are significant. If this group of consumers is not loyal due to symbol-
ism, inertia loyalty could be unpredictable for the brand, as it is not borne out
of commitment to the brand. Besides, attempting to retain such a loyal group
through frequent sales promotion may not enhance consumers' bonding with
the brand.
Floaters are a group of consumers who are “low” on both “brand bene-
fit set” and brand loyalty. They are price conscious consumers who may be
switching brands for purely pricing reasons and they may be prone to sales
promotion deals of several brands in several product categories.
Mystery group consists of the group of consumers who are “high” on
“brand benefit set” but low on brand loyalty. These types of consumers buy
the brand less frequently than Vitals though they may be convinced about
the intrinsic value of the brand in terms of benefits and trust. They may be
using the brand on specific occasions (like a brand of detergent used for wash-
ing special clothes). Affordability could be one reason. Consumers may be
attempting to regulate their category purchase with their favourite brand and
with less favourite brands for a given period of time. If price consciousness
is not the reason, variety-seeking behaviour to try other brands in the cat-
egory may be another reason for buying the brand less frequently. Launching
brand variants to increase brand usage among these consumers who value
the brand, is an appropriate strategy. Colgate Fresh Energy (the gel variant
of Colgate) was launched several years after Close-up pioneered the category
of gel toothpaste in India. This may be to ensure that loyal consumers of the
brand (or at least a cross section of them) stay within the fold of the brand by
buying the variant.
Symbolism has lower significance with regard to brand loyalty in the cat-
egory chosen, and hence, the framework has considered only those factors that
are primary reasons for being loyal to the brand (except in the case of Shakers).
In other categories of consumers explained in the framework, symbolism may

play a role in the trial associated with the brand. Enduring loyalty is a result of
product benefits and brand trust.
Genetic influences on brand selection normally would start with the
younger generation whose parents are associated with the Vitals group of
consumers. This study indicated significant presence of genetic influence with
regard to brand loyalty, but genetic influence could get altered after a period
of time because of the younger generation's exposure to new brands/prod-
ucts. They are also influenced by several kinds of different reference groups
(Hawkins, Best and Coney, 1998). Hence a brand has to ensure that brand vari-
ants are in consonance with changing trends as appropriate to the younger
generation. Thus, variants should be introduced to prevent the group from
moving over to other types of groups associated with loyalty. While Colgate
has been in the market for several decades with its original version of the
mother brand, the brand has introduced Colgate Strong Teeth, Colgate Total
and Colgate Herbal in the last decade. If brand loyalty indicates a strong pres-
ence of genetic influence, the brand should ensure appropriate relationship
management programs that link both the younger and older generation, with-
out losing the contemporary slant essential in a category like toothpaste. Such
a challenge could open up new dimensions in branding.
Limitations of the Study and Directions for

Future Research
The study has probed into only one category and hence the results cannot be
generalised for other categories of products. Even for the same category, dif-
ferent buyer groups/segments may express different responses with regard to
the dimensions involved in the study. Hence, the study provides only certain
factors that are linked with loyalty.
The study has not probed into how each loyalty group of consumers
(namely, low loyalty, medium loyalty and high loyalty) differ on brand ben-
efits, brand trust, price consciousness and brand symbolism. Future research
should establish that the various groups of loyal consumers differ in terms of
factors linked to loyalty.
Symbolic behaviour is being attributed to “low benefit–high loyalty”-based
consumer group. Further research should probe into the impact of symbolism
on loyalty (especially the different degrees of loyalty and their linkages with
symbolism). Research on genetic influences with regard to loyalty has been
accomplished to a limited extent and this factor could be analysed further.
The factor may be relevant to mass marketing of FMCG products in markets
of developing countries where parents are still perceived as role models in
several aspects of life. Urban markets in these countries may have experienced
a change, but rural markets could be researched on genetic influences on con-
sumer buying.
Appendix: Scale Items in Questionnaire

1 2 3 4 5
Completely Moderately Neither Moderately Completely

Disagree Disagree Agree nor Agree Agree
Disagree
Price Consciousness
I usually buy toothpaste, which is on sale. 1 2 3 4 5
I buy the lowest-priced toothpaste that suits my needs. 1 2 3 4 5
When it comes to choosing toothpaste for me, I rely heavily

on price. 1 2 3 4 5
Brand Functional Benefits
I feel that use of my regular brand of toothpaste provides

me freshness throughout the day. 1 2 3 4 5
I feel that prolonged use of my regular brand of toothpaste

would prevent tooth decay. 1 2 3 4 5
Use of my regular brand of toothpaste gives me a refreshing

taste. 1 2 3 4 5

helps in cavity protection. 1 2 3 4 5

helps in whitening teeth. 1 2 3 4 5

helps in gum protection. 1 2 3 4 5
Brand Loyalty
I will buy my regular brand of toothpaste, the next time

I purchase toothpaste. 1 2 3 4 5
I intend to keep purchasing my regular brand of toothpaste. 1 2 3 4 5
I am committed to my regular brand of toothpaste. 1 2 3 4 5
I would be willing to pay a higher price for my regular brand

of toothpaste, over other brands. 1 2 3 4 5
Brand Trust
I trust my regular brand of toothpaste for my tooth-related

problems 1 2 3 4 5
I am likely to use my regular brand of toothpaste even

if there is a scam surrounding it. 1 2 3 4 5
(Continued )
Appendix: (Continued )
I rely on my regular brand of toothpaste for my tooth-related

problems. 1 2 3 4 5
My regular brand of toothpaste is a reliable brand. 1 2 3 4 5
Brand Symbolism
Using my regular brand of toothpaste helps me express my

personality. 1 2 3 4 5
Knowing whether a person uses my regular brand of

toothpaste or not tells a lot about that person. 1 2 3 4 5
One can tell a lot about a person from the brand of

toothpaste he/she buys. 1 2 3 4 5
Genetic Influence
My regular brand of toothpaste is the same as what my

parents had used for many years. 1 2 3 4 5
My regular brand of toothpaste is the one I had used since

my childhood. 1 2 3 4 5
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2
Cultural Values and Branding

in an Emerging Market:
The Indian Context*
S. Ramesh Kumar,
Nitya Guruvayurappan and
Madhurjya Banerjee
India is undergoing unique changes in its marketing context. These changes are
so unique and profound that the brand strategies practiced in developing markets
would require a significant adaptation to suit the Indian scenario. Cultural con-
siderations are central to any brand’s strategy that connects consumers with the
brand’s proposition. They also add tremendous value to the functional orientation
of a brand. The combination of cultural value with functional utility is a powerful
strategy adopted by a few successful brands in the recent times. Besides, cultural
nuances of the country require a proper balance of emerging western values and
strongly entrenched Indian values.
This study probes into specific Indian values drawn from literature, uses them to
analyse how appropriate they are to consumers belonging to two socio-economic
classes in three categories of products close to the cultural moorings of Indians—
tea, hair oil and fairness creams. The idea behind the analysis of values stems out
of the fact that values are enduring since they are not tied to anything specific; and
instead manifest themselves in many nuances of behaviour, including choice and
purchase preference. The results of the respondents are compared with the authors’
perception of how the advertisements in the respective categories reflect the val-
ues found significant among the respondents. The practical implications of such a
study range from adopting Indian cultural cues to advertisements, to combining a
unique mix of Indian cultural values to a brand in a specific category. A study of
* This reading was first published as Ramesh Kumar S., Nitya Guruvayurappan, and Madhurjya Banerjee
(2007), “Cultural values and branding in an emerging market: the Indian context”, The Marketing Review,
Vol 7, No.3, 247–272. Reproduced with permission.
this kind will enable readers to understand the underpinnings of cultural dimen-
sions and their linkages with the mindset of consumers.
Keywords: emerging markets, Indian values, culture, brand positioning, fast moving
consumer goods, consumer behaviour
Literature Survey
Several works of literature on branding and culture were examined. Thomp-
son (2004) talks about an emerging stream of consumer research that suggests
a far more encompassing and significant interrelationship between cultural
processes/structures and brand meanings than just the brand image. Muniz
and O'Guinn (2001) and McAlexander, Schouten, and Koenig (2002) state that
rather than just being a symbolic resource for the construction of personal
identity, communal brands are a foundation of group identification and ex-
periences of social solidarity. Holt (2002), states that brands that successfully
accomplish this cultural emplacement acquire an aura of authenticity, which
consumers then covet as they seek to create distinctive personal identities and,
paradoxically, to resist conventional corporate influences.
O' Reilly (2005), talks about the interface between culture and business,
with specific reference to branding. McCracken (1990), offered a view of how
meaning is manufactured and moves within the world of goods. He pointed
out that a significant shortcoming in the study of the cultural meaning of goods
is the “failure to observe that this meaning is constantly in transit”. His “Movement
of Meaning” model showed the three locations of meaning—within the cul-
turally constituted world, within the consumer good, and within the individ-
ual consumer. According to the author, organizations naturalise their presence
by embedding marketing communication message in film, television, street-
level and ambient media. As Klein (2000) puts it, they become the culture. Holt
(2004) writes about this process of “cultural branding” and shows how brands
become “icons” through a process of myth creation.
McCracken (1986) talks about how consumer goods over and above their
utilitarian character and commercial value, also communicate cultural mean-
ing. Objects are an important way of substantiating a culture since they are a
vital tangible record of cultural meaning, which is otherwise intangible. Effect-
ive branding objectives can be achieved if we can transform a cultural identity
and usage to a brand identity and usage.
Thompson, Pollio and Locander (1994) talk about the network of cultural
influences that affect consumer behaviour. The literature talks about the applic-
ability to hermeneutics to drill down the cultural viewpoints underlying con-
sumers' expressions. Hermeneutics is defined as the science of interpretation.
It is a general model of the process by which understandings are formed. It
characterises the interplay between meanings handed down by cultural trad-
ition and the more personalised meanings that an individual constructs from
them. The literature uses hermeneutics to highlight cultural perspectives and
Cultural Values and Branding in an Emerging Market 395
relate interpretations to more general cultural orientations of consumer skep-

ticism, nostalgia and competitiveness, which are contextualised by broader
influences. Randazzo (2006), highlights the importance of creating an appeal-
ing brand identity and personality using popular cultural myths and stories,
to create an emotional connection between the consumer and the brand.
Briley and Aaker (2001), examine culture and its inadvertent manifestations
in a decision making process. The authors suggest three distinct moderating
factors that account for the malleability of cultural inclinations in decision
making – the need to provide reasons for actions, accessibility of associations,
and cognitive pressures. It is suggested that when a consumer deliberates on
reasons prior to making choices, it brings cultural knowledge to the focus of
the consumer. Cultural preferences, often assumed to be relatively stable and
driven by culture-based norms and traditions, may in fact be comparatively
unstable depending on the level of accessibility.
Rook (1985), defines rituals as a type of expressive, symbolic activity con-
structed of multiple behaviours that occur in a fixed episodic sequence and
tend to be repeated over time. Ritual experience relies on the concepts of arti-
facts, script, performance roles and an audience. Sources of behaviour could be
biological, individual aims and emotions, group learning, cultural values and
cosmological beliefs. Examination of rituals would aid in defining the areas
where culture manifests itself in everyday consumer behaviour.
Mehta and Belk (1991), try to understand and deconstruct the identity of
an Indian. The Indian allows object to become a part of self by habituation,
knowledge (familiarity), self-creation, proximity or metonymic association
with loved ones (Belk 1988). The same applies for rituals and other symbols
of culture. The author raises the question of whether culture is an adaptive
behavioural system that emerges from the influence of the environment and
causes changes in ideologies that encode these adaptations or whether cul-
ture is an ideational system, which causes changes in behaviour. He offers
Swidler's (1986) explanation that in settled conditions and periods, culture is
diffuse and leads to various adaptive behaviours whereas in unsettled peri-
ods and conditions, explicit cultural ideologies shape behaviour. Jung and Kau
(2004), highlight the differences between the different racial groups in Singa-
pore with the Hofstede's cultural framework of individualism – collectivism,
uncertainty avoidance, masculinity–feminity and power distance and help in
understanding these concepts.
Callow and Schiffman (2002), talk about how advertising interpretations
are dependent on cultural factors of the viewer, more specifically on the cul-
tural context of the communication. Across cultures, the differences in adver-
tising between countries is significantly due to cultural forces that shape the
consumer's value systems, beliefs and perceptual processes (Zhang and Gelb
1996). Lowe and Corkindale (1998), perform cross-cultural comparisons based
on five basic value orientations – human nature, man nature, time, activity and
relational. Holt examines the counterculture that is forming around the idea
that the branding efforts of global consumer goods companies have spawned
a socially destructive consumer culture.
High- and low-context communication has been studied extensively by

anthropologists. High context communication means that a large amount of
meaning is embedded in the usage situation i.e., the context within which
communication is occurring. Low-context communication is dependent on
the immediate situation or imagery to a very small extent, as the meaning is
expressed more through verbal or written language. Cultures vary in their use
of high and low context communication strategies. Salleh (2005) examines this
in depth. High- and low-context communication have been defined in terms
of emotional vs. logical brain usage, indirectness, non-verbal responses and
digital or analogous language. The reasons for this divide have been found to
be information ownership, economic structure and religion. This has been fur-
ther examined by Shao, Bao, and Gray (2004). The paper suggests that when
evaluating direct comparative advertisemrnts, consumers in low-context com-
munication cultures indicated higher persuasion effect than those in high-
context communication cultures.
Objectives of the Study

The authors' aim was to study how the Indian values (extracted from a
specific methodology) were reflected in the marketing communication of
brands in those categories that were close to the habits of Indian culture.
The selection of brands was based on an industry analysis of tea, hair oil and
fairness creams, and a perceptual map was drawn for each of the categories
with brands in each category. The perceptual map (not included in this art-
icle) helped narrow the study down to a sample of brands, which were then
examined for their communication. The objective of the study was to under-
stand
a. how strongly these brands use core Indian values in their communication
b. how distinctly these brands communicate to the different segments that
they target
c. whether there is any gap between the values communicated and the ones
that latently affect purchase decision in these social classes
Based on these findings, recommendations towards communication in each
specific category for each segment targeted were made.
Methodology
The first step in the study was to identify the core set of values that Indian con-
sumers identify with, and analyse their present application in the marketing
communication of various brands in three categories – tea, hair oil and fairness
creams. These categories were chosen due to their high relevance in the Indian
cultural context.
Extraction of values
The first part of the methodology was to extract and identify a core set of Indian
values that were to be tested for their applicability to selected segments and
their purchase decisions. The identification of Indian values was performed
based on multiple premises:
a. Literature
Here, two types of literature were examined. The first was related to
value systems in general. For example, the meanings for the set of Hofst-
ede's values, like power distance and uncertainty avoidance, Lowe and
Corkindale's five types of orientations, Mehta and Russell's values tied
to artifacts, and Schiffman and Kanuk's values pertaining to different
cultures and subcultures etc. were examined. This helped in identifying a
large consideration set of values, not all of which were necessarily applic-
able to Indian culture directly.
The other type of literature examined was more specifically written with
Indian culture in mind – for e.g. value orientations, emblems etc. identi-
fied by Kumar (2006) and Hoyer and MacInnis (1999), online references
for listings of Indian values, trends in the Marketing Whitebook about
the Indian consumer and behavioural decisions, magazines and news ar-
ticles specific to the Indian context, etc.
b. The authors’ judgment based on their exposure to Indian culture The second
phase was to narrow the overall consideration set to an almost exhaust-
ive but concise subset of Indian values. This was derived from the second
phase of the literature extraction, and also the authors' understanding of
applicability of values to the Indian context based on factors like
i. familiarity with the Indian subcontinent, its rituals, beliefs and
customs
ii. identification of Western values and trends that have influenced
Indian practices, an ability to make a distinction between the
natural and “naturalised” values, and hence identify the extent of
acculturation
Based on all of this information and multiple revisions of the sample set, a
core set of 32 values were identified (see Appendix 1).
Preparation of the Values Scales

A measurement scale was composed for each of these 32 values. Each value
was represented by a set of five statements, which correlated either posi-
tively or negatively with the corresponding value. Each statement had a
Likert scale of five levels from Strongly Agree to Strongly Disagree. Respon-
dents were expected to express their agreement or disagreement with the
statements in the scale for each value. The construction of the representative
statements is as explained in Malhotra (2005). The formation of the scales
was also aided by the handbook of marketing scales, which had samples for
multiple market research-oriented measurements. The questionnaire is in
Appendix 1.
Sampling
The creation of scales was followed by the sampling process, which was in the
following manner:
Target population
This is defined in terms of elements, sampling units, extent and time. The ele-
ment was urban upper and middle class individuals, and the sampling unit
was households (since income and lifestyle were used at a household level as
a parameter). The extent was urban India as a whole (respondents were from
multiple geographical regions in this scope) and time factor was the period of
survey (October 2006).
Urban upper
Income – monthly household income (MHI) Rs 20,000+
 Lifestyle – This class seeks luxury, is outgoing, extremely fashion con-
scious, bold and more liberated. They are willing to accept different cul-
tures and try out new things. The penetration of durables is extremely
high amongst this class. They are often the ones who are most likely to
adopt new product categories and variants. The penetration percentage
of various durables is shown in Table 2.1. Members of the upper class
– around 1 percent of the population – are owners of large properties,
members of exclusive clubs, vacationers in foreign lands, and include in-
dustrialists, former maharajas, and top executives. Foreign business trips
are extremely common and slowly foreign destinations are becoming fa-
vourite family holiday destinations too.
Urban middle
Income – monthly household income (MHI) Rs10,000+
 Lifestyle – This group is mobile, driven, consumer-oriented, and, to some
extent, forward-looking. Hard to define precisely, it is not a single stratum
of society, but straddles town and countryside, making its voice heard
everywhere. It encompasses professionals, white-collar workers, business
people, military personnel, and a myriad of others, all actively working
towards a prosperous life. Ownership of cars, televisions and other con-
sumer goods, reasonable earnings, substantial savings, and educated
children (often fluent in English) typify this diverse group. Many have
ties to kinsmen living abroad, who have done very well. These consumers
seek equality and are extremely quality conscious. They are familiar with
Western cultures but often take a conscious step towards accepting it due
to deeply ingrained cultural values. This class is fast catching up with the
upper class in terms of durables owned. Mostly comprising of profession-
als like software executives, medical practitioners, educationists and rela-
tively smaller businessmen, the middle class is a lot more value conscious
in their purchase pattern. Traditionally, they are thriftier and like to save
for a rainy day but that is fast changing. They would normally choose
low-cost airlines, domestic locales for vacations, etc.
Table 2.1  Penetration Percentage of Consumer Durables in the Urban

Household.
Urban
Social Class Upper Middle
Income (MHI) Rs. 20001+ Rs. 10001 to 20000
Size (in mn hh) Top 5 Next 21
Population % Top 10 Next 30
Penetration %
CTV 96 69
Refrigerator 82 58
2 wheeler 68 49
Car 24 5
Telephone 79 50
Washing m/c 44 19
PC 14 3
Sampling frame
The bases of selection of representative elements of the target population were
taken as income, occupation and lifestyle.
Sampling technique
Probability sampling was the chosen technique within which stratified ran-
dom sampling was performed. Here, the population was partitioned into
sub-populations of urban upper class and urban middle class. Members from
each class were selected on a random procedure (simple random sampling).
Here, the sample elements were selected probabilistically rather than being
based on convenience or judgment, unlike in quota sampling. The stratifica-
tion variable was taken to be social class. Also, the individuals were tested
to ensure that they were consumers of at least one of the categories under
consideration.
Sample size
Sixty-four respondents from each of the strata were selected on simple ran-
dom sampling for each of the categories—this gave a total of 384 respondents
(across two strata and three categories).
Analysis of Consumer Responses

Each of the selected respondents was asked to identify the extent to which
he or she identified with each of the five statements for each value on a
5-point scale. For the measurement scales, the Handbook of Marketing Scales of-
fered some standard pre-defined scales and the others were devised by the
authors.
 Dominant values extraction
 The responses were subjected to different types of analysis. The first
objective was the extraction of dominant values. Multiple options for
the measurement of strength were considered, but finally the measure
of an inverse coefficient of variation (μ/σ) was considered appropriate,
since the greater value of this not only strengthened the mean replies
inclined towards that value statement, but also reduced the variation
between them. The dominant values were extracted not just for each
social class but for each category of consumers within the class as well.
Apart from this, there was an overall aggregate value extraction irre-
spective of category consumption, to establish facets specific to that
social class. The result of the extraction of dominant values are given in
Appendix 2.
 ANOVA
 The next was to test for a significant difference between sample means, to
determine if there was a remarkable difference in the belief systems. This
was preceded by a test of standard deviations to ensure that the samples
compared were not significantly different in this respect and hence an
ANOVA was valid. Subsequently, the test for means was performed via
ANOVA on different samples – at aggregate level as well as at individual
category–class combination levels. An example of verification of ANOVA
condition of the test is given in Appendix 3.
Results of Data Analysis
Evaluation of dominant values

The objective was to identify the dominant values of each class–category com-
bination, and also of the upper and middle class groups, as a whole. For calcu-
lating the dominant values, the inverse of the coefficient of variation was used
i.e. μ/σ, where higher the mean and lower the standard deviation implied a
greater value for this variable and also better strength of the value assessed.
Hence, this was used to calculate the dominant variables. The results are in
Appendix 2, and are summarised here as follows:
Dominant value across classes:

Overall Class Dominant Value 1 Dominant Value 2 Dominant Value 3
Upper Gifting trends Cooperation Respect for work
Middle Cooperation Individualism Respect for work
Dominant values across classes for each category:

Dominant Dominant Dominant
Category Class Value 1 Value 2 Value 3
Fairness Cream Upper Respect for work Gifting trends Innovativeness
Hair Oil Upper Utilitarianism Power Distance Conservatism
Tea Upper Co-operation Innovativeness Self-esteem
Fairness Cream Middle Co-operation Individualism Self-esteem
Hair Oil Middle Respect for work Self-esteem Individualism
Tea Middle Co-operation Individualism Achievement

seeking
Evaluation of differences between means across

groups for individual values
The objective was to understand if there is any significant difference between
means of different groups for the same set of values. Again, this was applied
at multiple levels:
 At an aggregate level, comparing all upper class and middle class
respondents
 At a category level, comparing upper and middle class users of the same
category
 At each distinct group level of class–category combination
For all of these, ANOVA was used consistently. The prerequisite for ANOVA
is that the standard deviations of the samples must not be significantly differ-
ent. Since there was no basis for the assumption, this was tested using the F-
value comparison for two variances and was done for each of the samples for
each value. None of them were significantly different, and hence ANOVA was
applied. The null hypothesis was that the means were equal (hence, no signifi-
cant difference between the means). The alternative hypothesis was that there
is a significant difference between the means.
H0 μ1 = μ2 = μ3 = …
H1 μ1 ≠ μ2 ≠ μ3 ≠ …
The tests were against a significance level of α = 0.05. The observations are in
Appendix 3 and summarised here as follows:
Comparison of means for all 6 groups for each value
No significant difference between means for all values except “Innovativeness”
Comparison of means for upper and middle class tea consumers
No significant difference between means for all values except “Innovative-
ness” and “Neo-mindset orientation”
Comparison of means for upper and middle class hair oil users No significant differ-
ence between means for all values
Comparison of means for upper and middle class fairness cream users
No significant difference between means for all values except “Hospitality”,
“Honor” and “Gifting trends”
Comparison of means for overall upper and middle class respondents
No significant difference between means for all values except “Innovative-
ness” and “Honour”
Authors’ interpretation of values reflected in

communication of categories
To understand the use of the value cues in present-day advertising, the
authors have taken two popular brands in each category, identified from
extensive industry analysis.
Tea–upper brands Taj Mahal, Green Label

Communication: For Green Label, Group Emphasis and Hospitality aspects
are clearly identified. Conspicuous Western symbols are used to appeal to the
upper class consumers. The focus is often on the appeal it has to the sensory
pleasures of the connoisseur. Taj Mahal appeals to the innovativeness of the
upper class consumers, asking them to experiment with different varieties of
tea. The functional benefits are more distinctly portrayed. Overall, in this cat-
egory and class, the cues about functional benefits have given way to more
identifiable cultural cues.
Tea—middle brands Taaza, Gemini

Communication: Although no strong cultural cues in terms of values are iden-
tifiable in the ads for this segment, regional brands like Gemini use traditional
colours and symbols in the packaging to attract this group of consumers. Also,
they show strong family orientation. Thriftiness and time orientation (tradi-
tional) are important concepts that are encouraged by the ads. National brands
like Taaza make an attempt to appeal to the self-esteem and individualism of
the consumer. However, this is one segment where the functional benefits are
more strongly shown than cultural values.
Hair oil—upper brands Vatika, Parachute Advanced,

Keo Karpin
Communication: Since hair care is an important and almost daily activity for
Indian women, we see uncertainty avoidance as a clear tone used in the ads
for Vatika. For the younger generation, personal grooming concepts are being
used in the advertisements of Parachute Lite because of the social orientation
of the segment. Family bonding is an important value in the Indian psyche.
Often, the brand used by the mother is passed on to the daughter. Keo Karpin
effectively combines personal grooming concepts with family bonding values.
This is one segment where both functional benefits and cultural cues have
been extensively used.
Hair oil—middle brands Dabur Amla, Clinic plus,

Parachute
Communication: Interestingly, in this segment too, the advertisements often use
the same cues for values as in the upper segment. Although Dabur Amla has
used celebrities, the celebrity orientation cue is not sufficiently emphasised.
However, the concepts of personal grooming and social orientation are equally
important for this segment, as shown by the advertisement of Clinic Plus,
which also tends to target the importance of the younger generation attributes
to their peer groups. There is also a sense of utilitarianism in the advertisement
by the market leader, Parachute, which indirectly shows the time-tested good-
ness of pure coconut oil. In this segment, the functional benefits are stronger
than the cultural cues.
Facial cream—upper brands Lakme, Garnier

Communication: Individualism and uncertainty avoidance in the areas of per-
sonal grooming are well depicted in the advertisements of this segment for
both Lakme and Garnier. Fairness is no longer the only benefit being of-
fered here and the added attributes are being highlighted to touch the social
orientation of the consumers. In this segment, the functional benefits are
strongly highlighted in order to support the claims made by the advertisers.
However, given the Indian context, the cultural cues work at a subconscious
level.
Facial creams—middle brands Fairever,

Fair & Lovely
Communication: Both the major competitors in the market, Fairever and Fair
& Lovely have tried to appeal to the thriftiness of this segment in various
campaigns. The main cues for this segment have always been targeting the
achievement-seeking mentality and the need for affiliation. Time oriented-
ness is addressed, with most companies bringing out herbal variants. As in
the upper segment, the functional benefits have been clearly identified in the
communication. In both the cases, the cultural cues are used to attract the con-
sumers while the functional benefits are used to retain them.
Implications to managers
The research conducted showed that across categories there was a significant
difference or mismatch between the communication by the brand and the
inherent values of Indian culture. Many multinational brands, while enter-
ing the Indian market, fail to realise the importance of Indian values and use
them in their communication. They often undermine the importance of sev-
eral subcultures in the Indian context. The brand communication successful
in one region of the country is often replicated verbatim in another region,
without paying any heed to the cultural differences that exist across the ge-
ographies. The cost of communication is often one important constraint for
customisation.
The main reason behind this is a lack of understanding of the inherent
Indian values. This area is largely unexplored. This project has been a step
towards understanding them and studying their effectiveness and implica-
tions in branding. Often the communication is prepared based on the per-
ception of the marketer looking at a very narrow base of consumers. Also,
given the absence of any proper study, the “supposed” values of the Indian
consumer are based on a lot of myths and hypotheses, without a properly
researched data.
Significant differences were found between the upper and the middle
classes in certain categories. However, these differences were fast disappear-
ing as the middle class or the aspiring class was continuously striving to
achieve more than what their previous generations did. In some categories,
with the increase of consumer purchasing power and the non-availability of
super premium brands, the brand choices are often becoming similar across
the classes.
The brand manager planning to introduce a new offering in India will bene-
fit immensely from the study. Once the Brand Promise is developed, the brand
manager can decide how to reach different consumer segments using cultural
cues that appeal most to them. Also, during new product introductions, the
image that the brand wants to communicate can be developed based upon
the cues important to each target segment. The authors also believe that the
results of this study will have implications beyond developing better brand
communication. By understanding the cultural values important to a nation,
an organization can mold its operations to blend in with the environment,
giving it a better acceptability across consumer classes. For example, the rec-
ommendations given below for tea, hair oil and fairness cream are from the
results of the analysis.
Tea: Use the premise of group emphasis and need for affiliation to show
tea consumed in a collective setting. This would hinge on co-operation being
more important than competition. Similar lines but different execution would
focus on hospitality and serving good quality tea as a way of adding to the
self-esteem of the host and making them feel respected in the eyes of a guest.
Innovativeness can be encouraged by offering new variants of tea like green
tea, fruit tea and herbal tea, which are still nascent in the Indian market as seen
in the industry analysis of tea. From our understanding of the present com-
munication, this is already being tried by the industry. However, the cues need
to be more identifiable.
Hair oil: Consumers of this category in the upper class have shown utili-
tarianism, power distance and conservatism to be the dominant values. In this
case, it would make more sense to have a very functional proposition for the
upper-end consumer. Consumers may not want fragrance and low viscosity of
hair oil; they would rather prefer a no-frills product that satisfies its basic func-
tion of keeping hair healthy. Hence, for this category, the authors would rec-
ommend a natural/herbal/medicinal platform that clearly talks about healthy
hair and also offers good value for money, considering the conservativeness
of individuals in this category. The hair oil could be developed with a brand
personality of a “nourisher” and “nurturer” to establish trust.
Fairness creams: Considering that innovativeness has emerged as a prin-
cipal value for the upper class in other categories also, it could be recom-
mended that in fairness creams, it would be appropriate to focus on this
aspect for the upper-end consumer. This could again be on a rational or
emotional proposition, as in product innovativeness or user concept. Hence,
upper-end fairness cream variants would be better off pitching on the tech-
nology improvements in the category as the primary platform. Alternatively,
the brand can be positioned on the uniqueness of the user personality, lead-
ing to a willingness to try new brands and creams for him/her to look good
and feel confident.
Appendix 1: Questionnaire – Value Scales

Values
Power distance
I often seek opinions from people before making decisions.
There are many distinctions among people in my locality.
I believe that some people in my locality are clearly more influential than others.
I don’t think equality is a practical concept.
I look up to some people in society as really knowledgeable.
Uncertainty avoidance
I don’t like being uncertain about things.
I search for a lot of information before I do or buy something.
I don’t like being in unfamiliar situations.
It gives me a reassurance if other people are doing/buying the same thing as me.
I generally do not experiment while buying things.
Forward-looking
I often think about the future when I need to make a decision.
I believe in saving money for a rainy day.
When I earn some unexpected money, I don’t generally indulge it on myself.
I don’t expect immediate results for things I do.
I engage in a lot of planning and don’t believe in just living for the present.
Conservatism
I do not like to stand out in a crowd.
I am careful about the money I spend.
I don’t get too carried away when I am happy or successful at something.
I am cautious about my dressing and behaviour when I am with people.
I don’t think I can ever lead a flashy lifestyle.
Need for affiliation

It is important for me that others approve of what I do.
When in a group, I often behave in a manner that makes me fit in.
I often pay attention to others’ reaction to my behaviour.
In case of uncertainty, I look at others to get cues from them.
I often feel bad if my peer group doesn’t praise me for something worthy I’ve done.
Family bonding
I have a close relationship with my family.
I feel it is very important to bond well with family.
Family is the only long-lasting association that people have in life.
Values
I could leave an important career if it gives me no time with my family.
I feel close to members of family even if there are physical distances.
Utilitarianism
I generally buy products only if they are useful.
I am not impressed by free offers unless I definitely need the product.
I never buy items just because I liked its advertisement.
I don’t simply follow my heart while selecting products.
I make most purchases with a lot of thought.
Fatalism
I generally accept things that happen as fate.
I don’t think we have control over our destiny.
If bad things are to happen, they will happen.
I feel helpless in losing situations.
I can achieve only what is in store for me
Nominalism
I am not sure what many rituals of my religion actually stand for.
I sometimes follow practices without thinking much.
I don’t think I have tried to seek explanations of things that my parents tell me to follow.
I am indifferent to most of the cultural practices I indulge in.
With more time, I would try to learn about cultural aspects like weddings etc.
Achievement-seeking
I am highly ambitious in my career.
Being successful is the most important thing to me.
I like finding solutions to challenging problems.
I need to be acknowledged for my abilities by people around me.
I keep seeking milestones even when I have conquered one.
Respect for age

I believe my parents know better than me.
I always get up from my seat if I see an elderly person standing.
It is very annoying to see old people being spoken to rudely.
I believe that one can only get better with age, as one gains experience.
I feel comforted when there is someone elder to take care of certain situations.
Co-operation
I believe better work can be done by co-operating with peers.
I feel competing in things may sometimes lead to less work getting done.
(Continued )
Appendix 1: (Continued )
Values
When there is a task to be done, I try to think of how well we can get together and do it.
I enjoy donating things to charity.
I like taking part in community service at work or in the neighbourhood.
Nuclear family
I think that a small family is a happy family.
It is important for both parents to earn as living costs rise up.
I think both parents should share the work in the house.
I do not think we have enough space to have both my parents and my children in the
house.
I have never lived in a joint family.
Group emphasis
I love to hang out with my friends.
I would rather go out for dinner with friends after work than go home alone.
I do not like to go alone to have lunch in office/college canteen.
I am not dependent on one or two persons to make my weekend plans.
I am in touch with my college/school group through regular meetings.
Respect for work

I think success comes through hard work alone.
I believe that every field of work is equally appreciable.
I always try to give my 100% to the task at hand.
If my subordinates work hard, I never fail to compliment/reward them.
I respect everyone who does his/her work well, even though their social status may not be
the same.
Seeking prosperity
I want to have all the latest durables in my house.
I want my children to have the best education.
I think prosperity is related to social status.
I would not mind swapping a job just for the salary hike.
I want to earn enough for fulfilling all my adulthood desires.
Hospitality
I always invite friends and relatives over for dinner.
I love to have my relatives from other cities visiting me.
It is great to have your colleagues come over for a chat.
I am never put off by someone coming without informing.
I love to have my children’s friends dropping by even when my kids are not at home.
Values
Social Orientation
I am very particular about what I wear and whether it matches my personality.
I like to think that what I own is unique to me in some ways.
I try to develop an image based on the things I own.
I think my lifestyle is an actual reflection of my personality
My friends' circle and I have similar views towards life.
Self esteem
I seem to have a great deal of self-respect.
In almost every aspect, I am glad to be the person I am.
I feel I have a number of good qualities.
I take a positive attitude towards myself.
I feel I am a person of worth, at least on an equal plane with others.
Honor
I believe that the family name should be upheld.
I believe in spending lavishly in accordance with my status in family functions.
I would be exceedingly averse to borrowing money from people.
My family prestige is of utmost importance to me.
I would rather give up durables than part with a family heirloom.
Innovativeness
I like to experiment with my ideas.
I would like a job that requires frequent changes from one kind of task to another.
I like to try new and different things.
I often try new brands before my friends and neighbours do.
I am not afraid of failing with my creativity.
Conspicuous Westernised symbols

I like to party regularly.
I think social drinking is acceptable, and at times, necessary.
I own several designer clothing and accessories.
I lead a hectic life where take-away food is a significant part of my routine.
I feel it is a good thing to inculcate some Western practices.
Gifting trends
Whenever I go to visit a friend or a relative, I carry a gift along.
It is not the cost of the gift that matters to me, it is the thought.
The more expensive the gifts are, the better people would think of my social standing.
I take a lot of pains to choose the right thing for the right occasion.
I feel honoured when people make an effort to buy gifts for me.
(Continued )
Values
Personal grooming
I pay a lot of attention to how I look when I go out.
I am conscious of my looks even when I am not going for an occasion.
I think first impression is very important and I need to appear well-groomed when meeting
someone new.
I occasionally indulge in a beauty salon or a similar place to shape up my looks.
I tend to make opinions about people who are shabbily attired or too casual in appearance.
Family hierarchy orientation

It is the men in the family who purchase goods in my household.
The main earner has an important say in selecting brands.
The women of the house offer suggestions but the men take the decision.
Even for toothpastes, soaps, hair oil, creams etc. one person picks up brands for everyone.
The youngsters in my house have become more independent in buying after they started earning.
Ethnocentrism
I generally search for brands with Indian names or symbols.
I do not think a foreign brand is necessarily better than an Indian brand.
I feel an Indian brand is more suited to my needs.
I buy regional or national brands due to a strong sense of loyalty.
I feel we must buy more local products for helping Indian brands go global.
Individualism
I prefer taking most of my decisions myself.
I generally buy or consume things that reflect my uniqueness.
I like to be different from the crowd, at times.
I am not affected much by what other people do.
It is important to me that people respect my individuality.
Thriftiness
I am careful about the way I plan my finances.
Price promotions in shops often attract me.
I generally think low priced goods can serve my needs well.
I do not invest or spend money in ventures that I am uncertain about.
I would like to save money for the rainy day.
Celebrity orientation
I would buy a product that is endorsed by a celebrity I like.
I am attracted to advertisements that use celebrities.
If a celebrity is endorsing a product, he or she must have tested the qualities.
Values
By using the brand of my favourite hero, I feel I am being like him.
I change my brands based on my favourite sportsperson/film star’s preference.
Time orientation (living in the past/present)

I often think about the good old days.
I do not believe exciting days are coming ahead in my life.
Life was much simpler and carefree during my parents' time.
I wish I could have my old favourite brands back. They denoted quality.
You cannot be sure about product quality any more, these days.
Emotional decision making

I often take my decisions from my heart.
I feel it is healthy to express emotions.
I do not like to always be rational.
My opinions about people can be quite subjective.
I am open about my feelings with my peers.
Values Neo-mindset orientation

I change habits and behaviour with time.
I am often influenced by some of the new happenings around me.
I cannot stick to the same old practices all my life.
I do not mind breaking off from conventions.
I could call myself rebellious, to a certain extent.
Appendix 2: Dominant Values

Consumer Class: Middle Consumer Class: Upper
Category: Fairness Creams
VALUES μ/σ VALUES μ/σ
Power distance 7.199 Power distance 6.061
Uncertainty avoidance 5.901 Uncertainty avoidance 6.828
Forward-looking 6.734 Forward-looking 7.017
Conservatism 6.240 Conservatism 5.132
Need for affiliation 5.673 Need for affiliation 6.024
Family bonding 6.860 Family bonding 6.203

(Continued )
Utilitarianism 7.423 Utilitarianism 6.274
Fatalism 4.397 Fatalism 3.410
Nominalism 6.360 Nominalism 4.815
Achievement-seeking 7.092 Achievement-seeking 5.962
Respect for age 7.111 Respect for age 5.679
Co-operation 9.186 Co-operation 7.217
Nuclear family 7.039 Nuclear family 6.952
Group emphasis 6.662 Group emphasis 6.623
Respect for work 8.250 Respect for work 8.574
Seeking prosperity 6.073 Seeking prosperity 6.638
Hospitality 5.837 Hospitality 6.676
Social orientation 5.516 Social orientation 6.821
Self esteem 8.288 Self esteem 6.776
Honor 4.359 Honor 6.615
Innovativeness 7.020 Innovativeness 7.241
Conspicuous Westernised Conspicuous Westernised

symbols 4.236 symbols 4.774
Gifting trends 7.645 Gifting trends 7.479
Personal grooming 3.371 Personal grooming 4.640
Family hierarchy
Family hierarchy orientation 3.873 orientation 4.851
Ethnocentrism 5.528 Ethnocentrism 5.962
Individualism 8.700 Individualism 6.010
Thriftiness 5.569 Thriftiness 6.676
Celebrity orientation 3.243 Celebrity orientation 2.391
Time orientation (living in Time orientation (living in

the past/ present) 5.012 the past/ present) 4.573
Emotional decision making 6.181 Emotional decision making 4.165
Neo-mindset orientation 6.868 Neo-mindset orientation 7.201


Category: Hair Oil
Conspicuous Westernised Conspicuous

symbols 4.371 Westernised symbols 4.088
Family hierarchy Family hierarchy

orientation 4.045 orientation 3.599

(Continued )
Time orientation (living in the Time orientation (living in the

past present) 5.016 past present) 5.189

Category: Tea

Honour 4.931 Honour 5.317

Family hierarchy orientation 4.900 Family hierarchy orientation 4.586
Time orientation (living in the Time orientation (living in

past/present) 6.120 the past/ present) 4.910
Overall Dominant Values without Category Segregation

(Continued )

Family hierarchy orientation 4.586 Family hierarchy orientation 4.226
Time orientation (living in the Time orientation (living in the

past/ present) 4.910 past/ present) 4.814

Appendix 3: ANOVA
An example of verification of ANOVA condition of test for significant difference
between sample standard deviations (all results given to 3 decimal places):
Verification of ANOVA condition

Variance of sample 1 0.281
Variance of sample 2 0.242
Number of observations in sample 1 192
Number of observations in sample 2 192
F-observed 1.160
p-value 0.153
Significance (alpha–2-sided) 0.05
F-crit 1.329
Is it different? No
Comparison Level: Overall Upper vs. Middle

Significant difference between means exists for values
Honor
Innovativeness
For all other values, no significant difference between means
Anova: Single Factor – Honor

SUMMARY
Groups Count Sum Average Variance
Column 1 192 694.4 3.617 0.383
Column 2 192 660.8 3.442 0.579
ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 2.94 1 2.94 6.109 0.014 3.866
Within Groups 183.853 382 0.481
Total 186.793 383
(Continued )
Anova: Single Factor – Innovativeness

SUMMARY
Column 1 192 716.4 3.731 0.289
Column 2 192 684.4 3.565 0.277
ANOVA Source of Variation SS df MS F P-value F crit
Between Groups 2.667 1 2.667 9.428 0.002 3.866
Within Groups 108.052 382 0.283
Total 110.718 383
Comparison Level: Fairness Cream – Upper

vs. Middle
Hospitality
Honor
Gifting trends
Anova: Single Factor – Hospitality

SUMMARY
Column 1 64 236 3.688 0.31
Column 2 64 222.6 3.478 0.355
ANOVA
Between Groups 1.403 1 1.403 4.221 0.042 3.916
Within Groups 41.880 126 0.332
Total 43.282 127

Anova: Single Factor – Honor

SUMMARY
Column 1 64 236.6 3.697 0.307
Column 2 64 214 3.344 0.589
ANOVA
Between Groups 3.99 1 3.990 8.909 0.003 3.916
Total 60.427 127
Anova: Single Factor – Gifting trends

SUMMARY
Column 1 64 220.8 3.45 0.21
Column 2 64 209.6 3.275 0.183
ANOVA
Between Groups 0.98 1 0.98 4.987 0.027 3.916
Total 25.74 127
Comparison Level: Hair Oil – Upper vs. Middle

For all values, no significant difference between means
Comparison Level: Tea – Upper vs. Middle

Innovativeness
Neo-mindset orientation

SUMMARY
Column 1 64 242.8 3.794 0.276
Column 2 64 219.8 3.434 0.272

(Continued )
ANOVA
Between Groups 4.133 1 4.133 15.084 0.000 3.916
Total 38.655 127
Anova: Single Factor–Neo-mindset orientation

SUMMARY
Column 1 64 240.2 3.753 0.301
Column 2 64 227.4 3.553 0.236
ANOVA Source of
Variation SS df MS F P-value F crit
Between Groups 1.28 1 1.28 4.772 0.031 3.916
Total 35.079 127
Comparison Level: Across all 6 Groups of

Category-Class Combination
Innovativeness

SUMMARY
Column 1 64 240.8 3.763 0.267
Column 2 64 229.4 3.584 0.261
Column 3 64 232.8 3.638 0.32
Column 4 64 235.2 3.675 0.276
Column 5 64 242.8 3.794 0.276
Column 6 64 219.8 3.434 0.272

ANOVA
Between Groups 5.432 5 1.086 3.9 0.002 2.238
Within Groups 105.286 378 0.279
Total 110.718 383

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3
Linkages Between Brand

Personality and Brand Loyalty: A
Qualitative Study in an Emerging
Market—The Indian Context*
S. Ramesh Kumar,
Amit Luthra and Gaurav Datta
There are two topical areas, which are of interest to marketers—brand personality
and brand loyalty. Brand associations/brand personality and brand loyalty may
be associated with one another and may have important implications for market-
ers. There is a gap in literature on how each relates to the other and this study at-
tempts to establish the linkages between the two in both consumable and durable
categories. The study uses a focus group among the buyers of toothpastes and cars,
and suggests a framework linking brand loyalty and brand personality after quali-
tatively analyzing the responses obtained from the focus group. This would enable
marketers in an emerging market like India to formulate brand appeals and brand-
ing strategies for different kinds of consumers.
Keywords: brand personality, brand loyalty, consumer behaviour, emerging markets
The Indian context, which is the focus of this research study, is undergo-
ing radical changes. A population of 1.2 billion people offers complex chal-
lenges to marketers. There are multinational brands, which are attempting to
use the equity of their brands to appeal to a small niche of consumers. There
are millions of people who buy offerings in the unorganized sector (essentially
offerings that are much cheaper than the branded offerings but not necessar-
ily strong on quality). There are successful regional brands that have offered
the right value, taking into account the changing environment and consumer
needs. The geographical and cultural spread of the country, too, poses unique
* This reading was first published as Ramesh Kumar, S., Luthra, Amit, and Datta, Gaurav (2006), “Linkages between
Brand Personality and Brand Loyalty: A Qualitative Study in an Emerging Market in the Indian Context”, South Asian
Journal of Management. Reproduced with permission.
marketing challenges. There are twenty-five states, and each one of them have
their cultural differences. Companies of fast-moving consumer goods have
been running discount offers as a part of their strategy. There are also brands,
which make an attempt to appeal to consumers by creating brand personality
strategies. The study is attempted with context specificity as one of the import-
ant considerations to enable marketing practitioners to gain a few insights.
Literature Review
A brand has a personality, with which it acquires a character. The easiest way to
bestow personality on a brand is to provide it with a spokesperson, a star, or an
animal (Kapferer, 1992). People associate personalities with inanimate objects
too, on the basis of their opinions and evaluation of the same. It is the person-
ality of the brand that provides depth, feelings and liking to the relationship.
Thus, brand personality is an important brand strategy that marketers use to
target consumers and to build relationships with them (Aaker,1996). As noted
by a researcher (Gonzales, 2002), successful brands look beyond building
“transactional loyalty” and seek to develop “emotional loyalty”. Even in dur-
able product categories, emotion may be important in consumer decision mak-
ing (Amitava, 2002). A brand like Harley-Davidson has developed brand per-
sonality as a key strategy for competitive differentiation and building loyalty.
The influence of the consumer's personality dimensions on the personality of
their most preferred brand is another research dimension (Phau and Cheen,
2002). Their concept of self-congruity suggests that consumers tend to choose
situations and companions that reaffirm their self-schema. Following from the
self-congruity concept, it can be seen that consumers will use a self-congruent
brand as a vehicle to express their self-identity. Phau and Cheen also observe
that consumers are found to be cross-culturally different, both in their prefer-
ence for products and in their behaviour towards brands. The extent of indi-
vidualism or collectivism in a consumer's culture can be a major determinant
in their brand preference, brand association and their self-expression through
a brand.
Relationship marketing can be defined as attracting, maintaining and – in
multi-service organizations – enhancing customer relationships. The defin-
ition of relationship management as an ongoing process of engaging in co-
operative and collaborative activities and programs with immediate and end-
user customers to create or enhance mutual economic value at reduced cost
(Sheth and Paravtiyar, 2000) is a more practice-oriented one. Relationship mar-
keting can be practiced on the following three levels. The first level deals with
the financial incentives to customers; the second level deals with social bonds
(like sense of belongingness) and the third level relies on structural aspects
to solve complex problems of consumers. There could be degrees of relation-
ships, which marketers should take into consideration (Kumar, 2002).
For decades now, building brand loyalty has been propounded as the
panacea for all organizations to combat the increasing competition in the
Linkages Between Brand Personality and Brand Loyalty 425
marketplace. Various studies have been carried out to understand what con-
stitutes loyalty towards a brand. Early researchers focused on repurchase be-
haviour as a measure of loyalty towards a brand. This singular focus on repeat
buy as the only indicator of customer loyalty towards a brand meant that it
was assumed that big brands, in terms of market share, were the ones that had
the most brand loyal customers. This created the “Double Jeopardy”, (Sweet-
ney and Geoffery, 2001) phenomenon for smaller brands, i.e., not only do they
have fewer users but their users buy/use them less frequently. In recent times,
researchers have also questioned this assumption by pointing out that this ap-
proach confuses the “numbers of a brand's devotees with the degree of their
devotion to it”(Feldwick, 1996). This approach only leads to the conclusion
that the big brands will continue to remain big with no hope for smaller brands
to ever capture greater market shares. Alternative approaches of looking at
brand loyalty have been suggested in literature. In recent times, researchers
have focused on analyzing and comprehending another dimension of brand
loyalty, viz., attitudinal loyalty (Reinartz and Kumar, 2002). Further researches
are being carried out on understanding attitudinal loyalty. Some researchers
also opine that brand loyalty-specific measures are a better reflected through
the evaluation of attitudinal loyalty (Bennett and Thiele, 2001). On the other
hand, there are theories like polygamous loyalty theory (Dowling and Uncles,
1997), which states that customers do not buy only one brand. They have pro-
pensities to buy different brands. It is a better explanation of consumer be-
haviour than brand switching, which is a “conscious once and for all” change
of allegiance to another brand. The widespread belief is that loyal consumers
cost less to serve and show lesser sensitivity to price. They purchase more fre-
quently and in larger quantities and have a positive word of mouth (Fournier
and Julie, 1998). The link between customer satisfaction and customer loyalty
has also been established. Completely satisfied customers are strongly loyal
customers ( Jones and Earl,1995). Studies have also been carried out to identify
intergenerational influences for products and brands to measure the extent
of transfer of brand equity and brand loyalty from one generation to another
(Elizabeth, William and Richard, 2002). These studies conclude the following
findings: intergenerational impacts are at work across a spectrum of consumer
behaviour, intergenerational impacts can be measured at different stages of
the consumer's decision process, intergenerational influences exist within a
tumultuous, differentiated market place, and not all brands within a product
category are equally likely to benefit from intergenerational influences. The
need for “smarter” loyalty-building programs and management of loyalty
was recently published (Reinartz and V. Kumar, 2002). Studies have also been
carried out to look at the impact of the different incentives offered in loyalty
programs. Michelle Bolman and. Roehm Jr. (2002), have found that more the
incentive is compatible with the brand and the less tangible it is, greater is the
likelihood of leading to loyalty rather than drawing attention to itself. Halberg
(1995), voiced the opinion backed up by studies that all consumers are not cre-
ated equal. In tune with several practices of the past, it was felt that retaining
heavy users of a brand is critical to brand profitability. This approach gave rise
to the concept of segmenting by profitability, which emphasized that, a dis-

tinctive set of marketing mix elements would have to be formulated in order
to sustain the loyalty of a base of consumers who had reflected commitment to
the brand. According to Assel (2001), repeat purchase based on reasons other
than commitment to a brand is inertia loyalty. Therefore any research on loy-
alty should take inertia loyalty into consideration. While loyalty, satisfaction
and customer relationship management (CRM) are related concepts, recent lit-
erature throws up several interesting findings, which may be of importance to
consumers. One such finding is that satisfaction need not contribute to loyalty
(Reichheld, 2002). Another finding is that online consumers (Reichheld and
Phil, 2000) spend more if they are loyal to the vendor for a fixed period of time,
which varies from one product category to another. Amazon.com is a very
good example of how the online retailer is able to sustain loyal consumers.
Sixty to seventy percent of purchases made by consumers are repeat purchases.
A recent linkage to customer loyalty has been the various factors that lead to
customer migration. Gokey and Harold (2002), published that there could be
different kinds of loyalists who migrate to other brands for various kinds of
reasons, and that there could also be downward customer migration (custom-
ers who opt for offerings at a lower price point because of dissatisfaction with
a product or service, or for other reasons). Given the complexities of manag-
ing loyalty, a firm may have to cultivate several kinds of relationships over a
period of time among its customer base. The complexities could involve the
brand's share of customer requirements (given a customer's total requirement
of a product category) and the intention to buy (Kumar, 2002). This approach,
which could be applied both to FMCG products and industrial consumables
would require companies to research several aspects of customer satisfaction
and brand loyalty. It combines several aspects of loyalty, customer satisfaction,
inertia loyalty and switching behaviour of consumers. Recency (how recently
a customer has bought a brand), frequency (frequency of purchase of a brand)
and value (the monetary value of the purchase) known as RFM, is regarded as
a good measure of customer loyalty.
Objectives of the Study

The study attempted to explore the role of brand personality and value in cre-
ating brand loyalty in the following two product categories
 Durables—Passenger Cars
 Consumables—Toothpastes
The following dimensions were addressed in the study (Refer the Appendix):
 The linkages between brand personality and brand loyalty
 The strategies associated with brand personality and brand loyalty that
could be applied by marketers.
Methodology
The study attempted to explore personality—loyalty linkages in one consum-
able and one durable category to cover both high involvement and low in-
volvement purchases.
The choice of the product categories was made, keeping in mind the
following:
1. The categories should be established ones where consumer tastes and

preferences are established and not evolving (like for a new product), so
that behavioural patterns can be studied.
2. The categories should have enough brands so that the customer has op-
tions if he/she wants to use them.
3. Switching costs should not be too high so that loyalty is not forced upon
the customers.
4. The consumable category should have a small purchase cycle and high
purchase frequency
The following product categories were selected to carry out focused

research:
 Consumables—Toothpaste
 Durable—Passenger Car
Selection of Brands
It was decided to study closely a few brands in the chosen categories to under-
stand the positioning–personality frameworks currently being applied.
 Toothpaste—Close-up
 Cars—Santro,
The choice of the brands was influenced by the following reasons
1. The brands should have a very distinctive and clearly communicated
personality/association (either functional or symbolic or both)
2. The brands should have clearly defined value-creating attributes,
which are likely to have an impact on brand loyalty.
The category of toothpaste was selected as it was a familiar category among
consumers and they buy the category often. Toothpaste is a category, which
has been widely advertised for the last two decades and there was a high
probability that consumers may have formed a brand association with specific
brands. Close-up, Pepsodent and Colgate were considered, as these brands
have been actively attempting to create strong associations with their brand
building efforts in the recent times. Colgate was dropped as it had too many
variants and it was felt that consumers may be confused with regard to these
associations. For the same reason, the study was restricted to one brand from
the consumable category and one from the durable category. The objective was
to study and explore the linkages between brand personality and brand loyalty
(and not brand associations). Close-up was selected as it was a strong brand
among youth that has been in the market for more than 25 years. Its presence
has been advertised widely in the Indian market and perhaps, it is the first
brand to create strong association among youth in the category of toothpastes.
Santro, in consumer durable category, was selected because it was the fastest
growing brand in the respective segment in terms of market share, advertised
initially with clear functional associations (with a variety of features and the
tall boy design) and advertised later on lifestyle associations (as the sunshine
car with celebrities). The other car considered in the respective segment was
Palio but the brand did not match Santro on the criterion with which the car
brand was selected for the study.
Sample Selection
The profile of the target group of customers selected for the study is as
follows
 Cars
  Demographics
i. Age: 25–40yrs
ii. Gender: Mostly male
iii. Income: Monthly household income of Rs. 25,000–40,000, upper
middle class
iv. Education: At least a graduation degree
 Toothpastes
  Demographics
i. Age: 20–40 years. Though Close-up is a youth brand, it was
decided to include some respondents above 25 years as the brand
has been in the Indian market for the last 25 years.
ii. Gender: Male and female
iii. Income: Monthly household income of Rs. 25,000–40,000, upper
middle class
iv. Education: Graduation degree.
It was felt that focus group method would enable the respondents to
share their insights and produce data that would otherwise be less acces-
sible, given the nature of this study (Lindlof,1995). As the study involved
personality traits as applied to brands, it was felt that a focus group would
also foster a freer expression of such traits (Levy,1999). Qualitative focus
group research was conducted among respondents in both categories (one
group of eight respondents was used for each category) on various aspects of
loyalty and brand personality. These aspects were choice of the brand, vanity,
materialism, innovativeness, social character, epistemic variables, extended
self, consumer ethnocentrism, loyalty, emotional influences, performance,
quality and cognitive factors. The research findings were qualitatively ana-
lyzed and a framework linking brand personality and brand loyalty was
developed.
Analysis of Focus Group Discussion

Discussion on cars
The various aspects researched in the study with regard to cars have been
showed individually to give an idea to the reader, about the extent to which
these have been associated with the feedback of the respondents.
1. Cognitive factors:
Product-related information was the primary concern of everyone in the group

when they evaluated advertisements. They felt that printed ads were more
helpful in decision making.
2. Brand personification:
The respondents felt that this was just an attempt by marketers to differentiate
the brand by associating a celebrity like Sharukh Khan or Sachin Tendulkar
to a car. The brand ambassadors do not influence them; they can at best be
attention-catching devices.
3. Quality:
The quality of the car was associated with maintenance (after features and per-
formance) and it was an important consideration for everyone in the group.
The number of service stations and spare parts availability were found to be
important.
4. Performance:
This was critical for everyone, but there were divergent views on what con-
stituted performance for them. Each one had different criteria, varying from
mileage to maneuverability.
5. Emotional Value:
Everyone wanted driving pleasure out of the car but did not attach much emo-
tional value to their cars.
6. Price:
Price was the deciding factor to decide on the category, but a difference of a
few thousands between different models was not important.
7. Loyalty:
Everyone said that they would look at all the options available whenever they
plan to buy their next car without any bias to the current car owned.
For those who switched cars, the reasons were,
  Upgrading to better options
  Need for a bigger car
  Trusted the Toyota brand name after the experience abroad. But at-
titudinal loyalty was exhibited, as they all said they would certainly
recommend their brands based on the positive experience they have
had with their cars.
8. Choice of brand:
The choice of the segment was price-dependent, while the choice of the brand
was features dependent. Only two respondents had bought more than one car
in India, and two others had bought cars abroad. For the remaining four, it was
their first car.
9. Materialism:
All the respondents felt that material possessions were not important to their
lives. Specifically on cars, the opinion was that it was a utilitarian vehicle.
10. Innovativeness:
There was no one in the group who was passionate about cars. They felt that
they were too busy juggling careers to keep up with the category develop-
ments. All of them said that before buying a car they would like to go through
the performance reviews, as it was a substantial investment.
11. Consumer Ethnocentrism:
Country of origin was not a concern at all for all but one respondent. This respon-
dent also had changed his view after his experience with an indigenous car.
12. Extended self:
For all the respondents the car was not an extension of self. They did not feel
that the car was a reflection of self. The whole idea of a car representing what
they are seemed preposterous to them.
13. Vanity:
For most, the looks of the car were not crucial as it was just utilitarian vehicle.
But when probed further, five of them did submit that the looks of the car
were certainly more important than other products like clothes, as this was a
long-term investment. For this 62.5 percent, the car was also a status symbol
to some extent.
14. Social character:
Only opinions of a few close friends mattered and the general opinion of peers
were not considered. It was their car, and hence they made the decision.
15. Epistemic variables:
All the respondents test-drove all the available models in the price category. But
the final decision was not made with the view to stand out from the crowd.
Key findings from the responses

Cars are a very high involvement category, and hence decisions are made
after much deliberation. Prospective buyers test all available models and the
purchase decision is primarily made on the basis of a methodical comparison
of features. While car was an important investment, its value in the lives of
the respondents was not too much, and very little emotions were attached to
it. The car was mainly looked at as a utilitarian vehicle with elements of van-
ity and social acceptance associated with the brand being somewhat relevant.
The advertisements that use brand ambassadors were just attention-grabbing
mechanisms and played no part in the actual decision making process, which
was a cold, methodical one. This may conflict with the earlier finding that
vanity and social acceptance related to the brand does surface in decision
making. Printed advertisements focusing on the features were of more inter-
est. Hence, the influencing role played by the brand personality of a car is
very limited.
Attitudinal loyalty was exhibited, as the respondents would recommend
their brands based on their experience but behavioural loyalty was unlikely
as they said they would consider all options available without a bias when-
ever they would make their next purchase. Changing or improving a brand's
personality did not change the way the respondents thought of their car and
hence, did not influence loyalty towards the brand.
Discussion on toothpaste
As in the case of cars the responses from respondents on the category of tooth-
paste is given below:
1. Choice of brand:
Current toothpastes used: Close-up, Colgate Gel, Colgate Dental Cream, Pep-
sodent. Only three umbrella brands were present in the choice set of all the
respondents. Fifty percent of the panel used more than one brand. Though the
respondents had tried variants of their favorite brand, most of them reverted
to the original brand.
2. Materialism:
All the respondents felt that material possessions were not important to their
lives.
3. Innovativeness:
Though the involvement towards a sub-category (such as gel toothpastes)
was high, the category of toothpastes, on the whole, enjoyed moderate
involvement.
4. Consumer Ethnocentrism:
This aspect could not be explored satisfactorily.
5. Compulsive buying:
All the respondents said they never indulge in compulsive purchase of tooth-
pastes. They mostly know what brand to buy before they enter the shop and
don't get tempted into impulse purchase.
6. Extended self:
For all the respondents, the toothpaste was not an extension of self. But they
did feel that at times toothpaste was a reflection of the self. They think that
they feel younger, more enthusiastic and spirited if they use gel toothpaste.
7. Vanity:
The looks of the toothpaste were important to 100 percent of the panel. They
believe that their toothpaste reinforced their good looks and helped them feel
good about themselves.
8. Social character:
The opinion of peers and even close friends was not considered at all in the
purchase decision.
9. Epistemic variables:
Sometimes, the epistemic variables caused a temporary brand switch. But the
novelty of the new brand did not last for very long.
10. Cognitive factors:
High recall of the advertisements was noticed. Though certain information
such as the new chemicals like germi-check or micro-granules did affect the
decision, it was the symbolism that played a greater role in their decision.
11. Brand personification:
Strong personality was associated with two brands, Close-up and Pepsodent.
This may perhaps be because of the clearly communicated personality of these
brands in the promotions.
12. Quality:
There were no clear determinants of quality apart from product attributes such
as freshness and the parent company of the brand.
13. Performance:
Freshness was the single most important variable of judging performance.
Though white teeth and strong teeth were the others, these did not seem as
important because they are more difficult to evaluate.
14. Emotional Value:
High emotional connotation was noticed because of the favorable effect on looks.
15. Price:
Value plays an important role in the purchase decision. Price, itself, is not a
strong determinant, but price/quality relationship is what drives the decision
to buy. The price difference among brands was considered to be minimal. So it
did not affect the choice much.
16. Loyalty:
The loyalty towards the sub-category (such as gel) is seen to be much higher
than towards the brand itself. All the respondents said they would prefer not to
switch from their current brand. If their brand is unavailable in the shop then
they will prefer to buy a different size or go to another shop. Intergenerational
loyalty is high and the intent to repurchase the same brand is also very high.
Key Findings from the responses

Brand personality and value, both played a role in determining brand and cat-
egory loyalty of the consumers. Brand personality was seen to play a much more
significant role. Brands with a clearly communicated consistent personality had a
bigger set of loyal customers. This was due to the inability of the buyers to differ-
entiate the interface between personality and value. Brand prsonality reinforced
certain value dimensions such as emotional value, epistemic value and situational
value. Value was also found difficult to be determined as the respondents could
not express much about the quality variables, and the price is not much of a differ-
entiator among brands. Thus communications for a low involvement product cat-
egory such as toothpastes should emphasize brand personality over value. High
intergenerational loyalty was seen to be present. Such intergenerational loyalty
was seen in brands, which have had a consistent personality over a large period
of time. This can also be attributed to the usage pattern of a product, like tooth-
paste that has an essential daily usage by the entire family. Thus, the members of
the family have a strong influence on one another in determining the choice of
brand and subsequent brand loyalty. Loyalty was observed to be greater towards
a product sub-category such as “gel” toothpaste than towards the whole tooth-
paste category in general, or a particular brand of toothpaste. Promotional efforts
in-sync with the personality of the brand were seen to have a high recall amongst
the respondents. For e.g. “the germ-detector” of Pepsodent further strengthened
the “mother-like protective” personality of the brand.
Implications of the Research Study
Durable Product Category

Focus on the car market and the market for other such durables is clearly based
on the value proposition, with brand personality playing a marginal role. Thus,
marketers of such high involvement products need to concentrate more on de-
veloping the right product, than establishing a brand personality. As the pur-
chase decision for these products is mainly made based on a feature compari-
son, the manufacturers need to ensure that their product has the technological
capabilities desired by the target segment. There is a very strong value orien-
tation for purchase of a car and similar products; hence the marketers need
to ensure that the price–feature comparison is in their favour. Cars/Durables
marketers must therefore understand what forms the value equation for their
product. They need to identify what constitutes the value set in a brand, and
provide an enhanced value set, which is superior to that of competitive brands.
Thus, it has to be a value-based differentiation and not just a symbolic differ-
entiation as achieved through brand personality. Brand personality can, at best,
complement the value-based differentiation but cannot substitute it. Building
loyalty for such high involvement products is a tough task as loyalty is com-
pletely value-driven, with the brand's personality not playing an important role
for an informed set of buyers. They would undertake a thorough analysis of
all offerings before every purchase, disregarding the previous brand they had
used. Further, in a category like cars, when customers buy a second or a third
car, they are looking to upgrade from one price segment to another. Hence, the
focus of the marketers should be to establish not loyalty for a particular brand
but for the overall marquee (the manufacturer's umbrella brand). For example,
a Hyundai Santro buyer is unlikely to buy another Hyundai Santro but would
like to upgrade to higher value car like a Hyundai Accent. Now, the task of
Hyundai is to establish loyalty for Hyundai through Hyundai Santro so that the
Santro buyer upgrades to a Hyundai Accent, and not to a competitive brand.
Thus, once the purchase has been made, the marketers must continue to make
the buyer of their brand believe that his/her car offers the best value propos-
ition by delivering on the features, and perhaps on services too; as it would be a
rational input for the next cycle of purchase decision while upgrading.
Consumables Product Category

The higher significance of brand personality over value in this product cat-
egory necessitates that firms should focus on the brand personality construct
than value construct in consumable categories that are characterized by low
customer involvement. Brand (sub-category) personality should be effectively
leveraged to reinforce important value dimensions. For instance the “youthful,
get a life” personality of Close-up emphasizes the emotional value of confidence
amongst youngsters. It prompts the target market to feel confident of themselves
to interact with the opposite sex. This confidence platform also strengthens the
situational value of using Close-up before important social gatherings such as

parties. Similarly, Pepsodent toothpaste has a “mother-like”, effective germ
fighter personality. This brand personality reinforces the emotional value of
mental peace by reducing the mother–child conflict about what they are allowed
to eat. The 24-hour-long protection from germs removes a mother's fear and
anxiety about germs infecting their children's teeth whenever they eat, thereby
increasing their peace of mind and reducing their worries. Such personality con-
gruence has also been used effectively by several other brands in the Indian mar-
ket. The “protection through health” positioning of Lifebuoy soap has given it
a “mother-like” personality of care and concern. This personality has been used
to reinforce value derived from the brand. One important prerequisite for lever-
aging the brand personality construct is that the communication should have a
clearly differentiated and well-communicated personality consistent over a long
period of time. Even when an attempt is made to change the communication of
the brand, the original personality and value dimensions should be highlighted
to minimize confusion and dissonance amongst the customers.
All further communication and promotion efforts should be in a direction
to reinforce the established personality of the brand. There should be high
consistency in the promotions, in line with existing value and personality di-
mensions of the brand. This will help differentiate the brand further in the
minds of the consumer. The firms should study the extent to which a brand
enjoys intergenerational loyalty amongst its target customers. Intergenera-
tional loyalty can be reinforced by appropriate communication emphasizing
how the brand has been effective in delivering its core benefit over the years.
The loyalty created will be especially higher if the senior members of the fam-
ily were early adopters of a new toothpaste concept, such as the gel variant
in toothpaste in the late 70s in the Indian market. Such early adopter loyalists
can be used as opinion leaders to inculcate loyalty amongst their own family
members and other acquaintances. Sub-category loyalty should be used as an
important tool to create brand loyalty. This has an increased importance in the
case of a first mover brand in a new sub-category. The brand should first cre-
ate loyalty and commitment towards the sub-category and then create an irre-
placeable link between the sub-category and the brand. Close-up, the initiator
of the gel sub-category in the Indian market used this construct effectively. It
promoted “gel for freshness” as the toothpaste for the young, and then firmly
established itself as the only gel toothpaste in the market for a long time. This
approach significantly raises the entry barriers for a new entrant in a highly
profitable segment, by increasing the switching costs of the loyal customers.
Framework on Brand Personality and Brand

Loyalty Linkages
The need for a framework, which involves brand loyalty and brand personality
The literature clearly establishes the need for performance-related and im-
age-related factors as strong factors that influence buying behaviour. Several
dimensions of brand loyalty and brand personality were explored in the

literature.
In the research study conducted, though respondents had expressed less of
emotional/psychological, meaning non–utilitarian factors with regard to pur-
chase of brands in both the consumable category as well as durable category,
there were a few important pointers in both these categories, which in the opin-
ion of researchers warrant a framework that will link brand personality and
brand loyalty. In cars especially, the vanity factor was considered by most re-
spondents as an important factor, to the extent of being even a status symbol.
In toothpastes, vanity, brand personality, extended self and emotional
factors were clearly present in the consideration behaviour of respondents.
Another implication to marketers is that both brand loyalty and brand person-
ality have a long-term orientation, and hence they have to involve a judicious
management of marketing mix elements. This necessitates a framework in-
volving both brand loyalty and brand personality with a marketing mix inter-
face. Finally, there is little academic literature, which offers a framework with
brand loyalty and brand personality linkages. Hence, there is a clear need for
a framework that establishes such linkages between brand loyalty and brand
personality, making marketing mix elements instrumental in the outcome
related to these factors. This study also establishes the importance of such a
framework for practitioners of marketing.
The Personality–Loyalty framework consists of brand loyalty and and brand
personality associations, and both these factors are categorized as “low”, and
“high”. The combination results in four types of consumers. A brand should
find out what percentage of consumers is present in each of these combina-
tions and if there is a dominant presence of consumers in any of the quadrants.
This classification would be useful for the marketers to formulate marketing
mix strategies (see Figures 3.1).
Low PROSPECTIVE SWITCHERS QUITTERS
Brand
Personality
Associations
High HARD CORE HUNTERS
High Brand Loyalty Low

(Value-based)
Figure 3.1  Brand Personality–Brand Loyalty Linkages: A Framework

1. The Hard Core Group: These consumers rank the brand high on value and
brand personality appeal. If the category is a Fast Moving Consumer Good
(FMCG,) the brand should ensure that it builds up a relationship with this
kind of consumers. The relationship program should be an exercise, which
would enhance the value and the brand personality appeal. A toothpaste
brand, which has “white teeth” as its proposition and a personality ap-
peal of being youthful and outgoing, could have a promotional contest,
which reinforces the proposition as well as the personality. “Whiteness” of
the teeth can be considered as the criterion leading to exciting gifts rang-
ing from group adventure activity to psychological benefits of becoming
popular through mass media after taking part in such experiences. In this
context (as appropriate to the brand), the “whiteness” (value) leads to sev-
eral social benefits that are associated with the personality of the brand.
Product improvements adding more value base are applicable to durables.
2. Hunters: These consumers rank high on brand personality but low
on loyalty. In a typical FMCG situation like soaps or cosmetics, the
consumers may identify their “inner-self” with the brand but the value
provided by the brand may not be adequate for these consumers to re-
main loyal to the brand. A competing brand could provide value to this
group of consumers, and over a period of time develop a personality
with which consumers associate themselves. While this is possible both
in FMCG categories and durables, durable marketers (in categories like
cars, two-wheelers, washing machines, television) may have a greater
impact on consumers because of the infrequent purchases made by the
latter. LG is a brand that is into several categories and the proposition is
value-based (fabric care in washing machines, pure-air in air conditioners
and nutrition in refrigerators). “Care and trust” is the personality dimen-
sion that gets supported by value-based dimensions. Given the low unit
value of FMCG products and the opportunity for consumers to switch,
a brand in a consumable category may find it feasible to attract a “niche
segment,” and move them to the previous quadrant. A niche segment
would be able to provide a premium, to get associated with an “exclusive
brand personality” and have added benefits in terms of value.
3. Prospective Switchers: Compared to the second quadrant, these consumers
may take a longer time to switch brands as their loyalty is very high and
this is based on their “value experience”. There is a high probability that
these consumers are more inner-directed, and hence, personality-based
brand building dimensions have a low influence in terms of emotional
impact. A brand, in this situation, should not only sustain the “value
experience” but also ensure that appropriate positioning strategies are
formulated for the inner-directed consumers (if it finds that majority of
consumers have this profile). If not, the brand has to build appropriate
strategies to move the consumers to quadrant 1.
4. Quitters: In a competitive context, it would be difficult for any brand to
survive in this quadrant.
Appendix: Dimensions Explored in the study

The following personality, loyalty and value dimensions were explored using
focus groups.
Toothpastes
Choice of brand
1. Name one brand of toothpaste.
2. What is your favorite brand of toothpaste?
3. Why do you prefer this brand over others?
4. What brands are you using currently?
5. For how long have you been using this brand of toothpaste?
6. What are the other brands you have used?
7. Why did you switch to the current brand?
8. Would you switch to a new brand in your next purchase? Why or why not?
9. How much time do you normally spend while making a purchase decision?
10. What is the most important thing to you in your choice of toothpaste
while making a purchase?
Personality scale items
Materialism
1. My brand of toothpaste forms an important part of my everyday life.
2. I'd rather buy a brand of toothpaste that simply looks better (more appeal)
rather than cleaning my teeth better.
Innovativeness
1. I know the names of new toothpastes launched, before most other people do.
2. In general, I am among the first in my circle of friends to try out new
brands of toothpastes.
3. If I hear that new toothpaste is available at the stores, then I surely would
be interested in buying it.
4. I would like to try a new kind of toothpaste even if I have never used
anything like it before.
5. I normally treat new products with caution.
6. I seek others' opinion before I try a new product.
7. I would be more comfortable trying out a new product that is endorsed
by a celebrity than a completely unknown one.
8. I buy a product that reinforces my beliefs rather than one which contra-
dicts them.
9. While evaluating a new product, I pay more attention to product ben-

efits, factual differences and product usage information.
Consumer Ethnocentrism
1. Toothpastes made in India, by Indian companies will always be better
than the ones produced abroad.
2. Even though toothpastes are a foreign innovation, it is a much better
product for oral hygiene than traditional remedies.
3. A true Indian will always buy Indian products, be it cars or toothpastes.
Compulsive Buying
1. I am often impulsive in my buying behaviour.
2. I have bought things I could not afford.
3. I will go to a store and pick up any brand of toothpaste I see without
much thought.
4. I have often bought products like a new brand of toothpaste or a brand
with promotional offer that I did not need, knowing I had very little
money left.
5. I sometimes buy things just to make myself feel better.
Extended self
1. I trust my toothpaste in taking care of my teeth.
2. The model in the advertisement reflects what I want to be, and hence,
I use this brand.
3. My toothpaste also symbolizes my identity.
4. My toothpaste helps me project the persona I want to present to my
friends.
5. The toothpaste I use says a lot about the kind of person I am.
6. My toothpaste helps me be what I have always wanted to be.
7. My toothpaste helps me experience a part of me, which I would not
have discovered otherwise.
Vanity
1. The way I look is extremely important to me.
2. My toothpaste helps me look and feel better.
3. It is important that I always look good.
4. I think strong, shiny white teeth are very important for me to look good.
5. My toothpaste makes me look better by ensuring fresh breath.
6. People often notice how attractive I am.

7. People pay attention to the smallest detail about the way I look.
8. People often walk up to me and comment on my smile.
9. Achieving greater success than my peers is extremely important to me.
10. My teeth add to my sex appeal.
Social character
1. I will normally buy a product at my own discretion, not bothering much
about its social acceptability.
2. I will never buy a product that does socially unacceptable advertising.
3. Social approval is important to me before I buy a product.
4. I will stop using my brand of toothpaste if it indulges in sexually ex-
plicit, violent or morally unacceptable forms of promotion.
5. I decide what is right or wrong for myself, and don't let people do it for me.
Epistemic variables (variety–novelty seeking)
1. I like variety in whatever I buy.
2. I will try out a new toothpaste just for the sake of variety.
3. Too much variety confuses me.
4. Greater variety helps me make a better choice of my product.
5. I might try out a new toothpaste for the sake of variety but not a new car.
Cognitive factors
1. I pay most attention to product-related information while watching an
advertisement for a toothpaste.
2. I am more attracted towards the model in the new advertisement for a
toothpaste, than the toothpaste features.
3. The features of a toothpaste highlighted in the ad have little effect on my
purchase decision.
4. I am more enthused by how exciting an ad is, than how much informa-
tion it provides me.
5. The music/jingle of the ad stays with me for a while even though I may
forget the brand and its features.
6. I will base my purchase decision to buy a toothpaste only on how much
I know about its benefits and how it is different from the others.
Brand personification
1. I like my toothpaste to be of high energy, like an athlete.
2. I want a toothpaste that excites me.
3. My toothpaste is my close friend.

4. I want my toothpaste to be reliable.
5. I want my toothpaste to be honest, down to earth and effective.
6. I believe that a red colored toothpaste cleans better than a white one.
7. I believe that a blue toothpaste is fresher than a red one or a white one.
Value dimensions
Quality
1. My toothpaste should perform consistently.
2. Consistent quality would make me buy the same brand of toothpaste again.
3. My toothpaste should taste the same every time I buy a new pack
Performance
1. My toothpaste must protect my teeth for me to ever use it again.
2. If I suffer from any dental problem, I will promptly change my brand.
3. If my friend told me that my breath does not smell fresh, I would buy a
new brand immediately.
Emotional Value
1. My toothpaste should make me feel good about the day, when I use it in
the morning.
2. My toothpaste should make me look forward to brushing my teeth over
and over again.
Price
1. My toothpaste should offer me value for money.
2. My toothpaste should work out to be economical for me.
3. Price should not be a concern for me when I am buying the same of
brand of car or toothpaste again.
4. A promotional offer will not make a difference to my purchase decision.
5. I often decide on the brand of toothpaste to buy at the retail counter
based on the promotional offers available at that point.
6. I don't mind buying an extra toothpaste even though I don't need it cur-
rently, if it is available on discount.
Social
1. My brand must be accepted by my friends.
2. I will not try a brand that my friends have bad mouthed.
3. I will think twice before buying a brand that no one in my friends' circle
uses.
4. I decide which brand of toothpaste to use; what people think has no bear-
ing on my choice.
5. All my toothpaste is supposed to do is to protect my teeth and provide
fresh breath; it is not going to help me win a beauty pageant.
6. I would rather use a gel toothpaste when I am going for a social gather-
ing, to gain more confidence
7. Advertisements showing toothpastes helping people win girlfriends are
downright stupid.
8. Social acceptability will help me want to buy the same brand again.
Loyalty
1. I am most likely to use the same brand of toothpaste for my future needs.
2. I will not even search for information on another brand of toothpaste the
next time I buy a new toothpaste.
3. I have purchased other products from the same company.
4. I always suggest and recommend my brand of toothpaste to my friends
and colleagues.
5. If my brand of toothpaste is not available at one store then I will go to an-
other store to buy it, but I will not buy any other brand.
6. I rarely take chances by buying unfamiliar brands, even if it means sacri-
ficing variety.
7. I would rather wait for others to try out a new brand than try it out myself.
8. I would rather stick with the brand I usually buy than try something I am
not very sure of.
9. If I like a brand, I rarely switch from it, just to try something different.
10. I usually buy the same brands even if they are only average.
11. When I enter a store, I am sure I want to buy only my brand of tooth-
paste and nothing else.
12. I feel proud to be seen buying my brand.
13. If I find that my brand is not giving me the quality I expect it to, then
I switch to another brand.
14. After switching from my favorite brand, I never go back to it.
15. I always try my favorite brand again even after switching to other
brands.
16. I am loyal to a brand that is being used in my home for the past many
years.
17. My parents made me loyal to a few brands they were loyal to.
18. My children also have the tendency to use some of the brands they see
me using regularly.
19. If my favored brand reduces my social acceptability, then I switch to
other brands.
20. If my favored brand no longer offers me value for money, then I will
switch to another brand.
21. I will always buy a brand I can relate to.
22. I will be loyal to a brand whose personality matches mine.
23. The more the congruence between my personality and that of my favor-
ite brand, the more loyal I will be to it.
24. My brand reinforces my personality.
25. I reinforce my brand's personality, in turn.
26. I will keep buying the brand that makes me realize what I am.
Cars
Choice of brand
1. Name one brand of car.
2. What is your favorite brand of car?
3. Why do you prefer this brand over others?
4. Which car do you own/use?
5. For how long have you been using this brand of car?
6. What are the other brands that you have used?
7. Why did you switch to the current brand?
8. Would you switch to a new brand in your next purchase? Why or why not?
9. What is the most important thing to you in your choice of car?
10. How much time do you normally spend while making a purchase
decision?
Personality scale items

Materialism
1. The car I own says a lot about how successful I am in life.
2. I would rather own a car that would impress other people than serve
my needs better.
3. I don't place much importance on material things such as cars as indica-
tors of success in life.
4. I would rather spend money on a car that looks and feels good even
though it might be impractical.
5. I like keeping my life simple, as far as possessions are concerned.

6. I would be much happier if I could afford one more car.
7. I am happy to buy a car that satisfies my needs without many frills.
Innovativeness
1. I know the names of new cars to be launched before other people do.
2. In general, I am among the first in my circle of friends to know about
new cars to be launched.
3. Compared to people I know, I own fewer cars.
4. In general, I am among the first in my circle of friends to buy a new car.
5. If come to know of a new car that has been launched, then I surely will
go and test-drive it, to purchase it if I like it.
6. I like buying the latest cars that are available and which suit my budget.
7. I normally treat new products with caution.
8. I seek others' opinion before I try a new product.
9. I would be more comfortable trying out a new product that is endorsed
by a celebrity, than a completely unknown one.
10. I buy a product that reinforces my beliefs, rather than one which contra-
dicts them.
11. While evaluating a new product, I pay more attention to product ben-
efits, factual differences and product usage information.
1. I will always buy a car that is made in India by an Indian company.
2. People should not be allowed to import cars to India, as they are being
manufactured here too.
3. Import of foreign cars should be taxed heavily to encourage people to
buy Indian-made cars.
4. I will buy an Indian car even if it is a bit lower in quality than foreign
cars.
5. A true Indian will always buy Indian products, be it cars or toothpastes.
Extended self
1. My car holds a very special place in my life.
2. My car helps me project a desired image to the world.
3. My car is central to my identity.
4. I am very emotionally attached to my car.
5. My car helps reinforce who I am.

6. My car helps me narrow the gap between what I am and what I try to be.
7. I would be a very different person without my car.
Vanity
1. The way I look is extremely important to me.
2. My car adds to my good looks.
3. It is important that I always look good.
4. When I go out to a public place, the car I drive enhances my looks.
5. People often notice how attractive I am.
6. People pay attention to the smallest detail about the way I look.
7. Achieving greater success than my peers is extremely important to me.
8. My car is a sign of my success.
Social character
1. I will normally buy a product at my own discretion, not bothering much
about its social acceptability.
2. I will never buy a product that does socially unacceptable advertising.
3. Social approval is important to me before I buy a product.
4. I will switch cars if my girlfriend disapproved of my current car.
5. Car is a status symbol, and hence, what my peers think of it is crucial.
6. Car is for driving and that's all it should do.
7. I will stop using my brand of car if it indulges in sexually explicit, violent
or morally unacceptable forms of promotion.
8. I decide what is right or wrong for myself, and don't let people do it for me.
Epistemic variables (variety–novelty seeking)

1. I like variety in whatever I buy.
2. I will try out a new car just for the sake of variety.
3. Too much variety confuses me.
4. Greater variety helps me make a better choice of my product.
5. I might try out a new toothpaste for the sake of variety, but not a new
car.
6. If I had the money I would buy a totally different car from what I cur-
rently own, for variety.
Cognitive factors
1. I pay most attention to product-related information while watching an
advertisement for a car.
2. I am more attracted towards the model in the new ad for a car than the
features.
3. I am more enthused by how exciting an ad is, than how much informa-
tion it provides me.
4. The music/jingle of the ad stays with me for a while, even though I may
forget the brand and its features.
5. I prefer print ads, as they let me glean the relevant technical information.
6. I will base my purchase decision to buy a car only on how much I know
about its benefits and how its different from the others.
7. I would rather have more visual information about a new car than read
about it.
Brand personification
1. I like my car to be of high energy, like an athlete.
2. I would like my brand to be sincere.
3. I want a car that excites me.
4. Sophistication is most important to me (than ruggedness), when I buy a car.
5. My car is my close friend.
6. The color of my car is an important decision variable.
7. I want my car to be reliable.
Value dimensions
Quality
1. My car should have consistent quality.
2. My car should be really well-made.
3. My car should not have poor workmanship.
4. My car should last a long time.
5. My car should not demand frequent repairs.
6. A good quality car will make me want to buy the same brand the next time.
Emotional Value
1. My car should be one that I enjoy driving.
2. My car should be one that makes me want to use it.
3. My car should make me feel good.
4. Driving my car should give me more than just utilitarian driving comfort.
5. Driving my car should be a relaxing experience.

6. Driving my car should be an exciting experience.
7. Driving my car should make me smile every time I am behind the steer-
ing wheel.
8. More the emotional satisfaction I derive from my driving experience,
more loyal I will be towards my brand.
Price
1. My car should be reasonably priced.
2. My car should be a good product for the price.
3. The features offered should be directly proportional to the price charged.
4. The features offered should form the primary basis of price charged.
5. I should feel that I have paid the right price for my car.
6. Price should not be a concern for me when Iam buying the same brand of
car again.
Social
1. My car would help me to feel socially acceptable.
2. My car would improve the way I am perceived.
3. My car would make a good impression on the other people.
4. My car will give me social approval.
5. Social acceptability will help me want to buy the same brand again.
Loyalty
1. When I purchased my car, this brand was my first choice.
2. I will not even search for information on another brand of cars, the next
time I buy a new car.
3. I have purchased other products from the same company.
4. I always suggest and recommend my brand of car to my friends and
colleagues.
5. I rarely take chances of buying unfamiliar brands, even if it means sacri-
ficing variety.
6. I would rather wait for others to try out a new brand than try it out
myself.
7. I would rather stick to well-known companies while buying a car.
8. I would rather stick with a brand I usually buy than try something I am
not very sure of.
9. If I like a brand, I rarely switch from it just to try something different.
10. I feel proud to be seen buying my brand.

11. If I find my brand is not giving me the quality I expect it to, then I switch
to another brand.
12. After switching from my favorite brand, I never go back to it.
13. I am loyal to a brand that is being used at my home for the past many
years.
14. If my favored brand reduces my social acceptability, then I switch to
other brands.
15. If my favored brand no longer offers me value for money, then I will
switch to another brand.
16. I will always buy a brand I can relate to.
17. I will be loyal to a brand whose personality matches mine.
18. The more the congruence between my personality and that of my favor-
ite brand, the more loyal I will be to it.
19. My brand reinforces my personality.
20. I reinforce my brand's personality, in turn.
21. I will keep buying the brand that makes me realize what I am.
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4
Cultural Dimensions and MNC

Brands: A Study in the
Indian Context*
S. Ramesh Kumar and Karan Bajaj
A number of multinational brands have arrived in the Indian context. Cultural

dimensions have a significant impact on the marketing mix elements of a
brand—both in high- and low-involvement categories. This article attempts to
develop a framework that will be useful to MNC brands entering India. This
framework, known as the cultural orientation model, was developed after an
analysis of the MNC brands that were launched both in developed markets and
in the Indian market, in conjunction with an empirical study to obtain inputs
on the cultural dimensions associated with the Indian psyche.
Keywords: MNC brands, consumer behaviour, fast moving consumer goods, culture, entry
barriers
Introduction
The Need to Explore Entry Strategies of MNC Brands

in the Indian Context
The Indian marketing context is going through rapid changes. There are MNC
brands that are almost a part of the Indian culture (like Colgate, Surf, Horlicks
and Lifebuoy). There are brands like Samsung, Whirlpool and LG that are new
to the context, but which have made a significant impact within a short time.
There are also brands like Sony, Nike, Kellogg and Ray-Ban, which have a strong
equity in international markets but have not captured a huge chunk of the mar-
ket in their respective categories. There is a gap in the literature on how MNC
* This reading was first published as Ramesh Kumar S., and Karan Bajaj (2002), “Cultural Dimensions and
MNC Brands—A study in the Indian context,” South Asian Journal of Management, Vol. 9, Issue .3, July–
Sept. 39–55. Reproduced with permission.
brands should adapt themselves to a developing market like India, especially

when they have been successful in developed markets. As we shall see, the mar-
keting mix elements have to be culture-specific in order to be successful.
Literature on the Linkages Between Marketing

and Culture
The research on investigating the potential of a particular value-assessing in-
strument, the Rokeach Value Survey (RVS), to distinguish cultural differences in
personal value structure suggests that personal values can be productively em-
ployed by international marketers to discriminate between people of culturally
diverse backgrounds. A discriminant analysis disclosed significant differences
in the self-value held by people from three cultures: Thailand, Mexico and the
United States (Michael and Shelby, 1979). Consumers' perceived attribute im-
portance along clothing, food, appliances, and household supplies of consum-
ers from five Asian Pacific regions, reflect notable differences (David, John and
Chin, 1988). Research comparing Korean immigrants and Americans in their
consumer product evaluation indicate that there are indeed ethnic differences
in consumers' evaluation of product attributes across four product categories—
automobiles, stereo system, laundry detergent, and coffee (Wei-Na and Koog-
Hyang, 1992). The scooter in Italy, Britain, and India, while materially the same
physical object, has taken on very different cultural meanings (Bruce, 1992). The
research on exploring differences in cognitive response content across two cul-
tures, United States (an individualist culture) and Taiwan (a collectivist culture)
listed thoughts towards advertisement and then evaluated them on a series of at-
titude scales. Whereas the U.S. subjects focused more on product-related claims
in the ads, Taiwanese subjects were more persuaded by their “ad evaluation”
thoughts about the appropriateness of the advertisements than by their prod-
uct thoughts (Sharon, Michlle and Rose, 1997). A realistic approach to research
culture would be to examine how one group of individuals differs from another
(Inng Tan, Jim and Jeannie, 1997). One study compared the effectiveness of stan-
dardized, semi-localized, and local television commercials in Israel (Bella, and
Aviv, 1999). The central argument is that international commercials, which ad-
dress common basic consumers' needs and values, and are language-adjusted,
can be as effective as local commercials. One study suggested the growing im-
portance of peripheral cues since U.S. market evidence showed increasingly
high levels of product homogeneity. As markets continue to mature and central
cues become more neutralized, peripheral cues should become more powerful,
regardless of involvement (Timoothy, David and Michall, 1993). Another study
explored a methodology for identifying the psychological functions of attitudes
towards a multifunctional consumer product – the automobile. It proposes to
use a distinction between instrumental and symbolic functions. Instrumen-
tal attitudes focus on the features and attributes of the target object and their
utility in providing better functioning in the environment (Richard and Mark,
1993). One paper argued that the predominant approach used in international
Cultural dimensions and MNC brands: A Study in the Indian Context 453
consumer research to study cultural differences – the personality/values ap-

proach – is inadequate for this task. Three weaknesses of this approach are de-
tailed—universalism and the negation of meaning, translation and the problem
of action, and holism and the level-of-analysis problem (Doughlas, 1994). An
empirical investigation was conducted to determine the relative importance of
cognition, country of origin, patriotism, and familiarity with a country's prod-
ucts in the consumers' attitude towards foreign brands. The results indicate that
cognition do not play the dominant role in attitudes as previously suggested.
The country of origin and consumer patriotism have significant roles in atti-
tudes (Min, 1994). One study proposed a method to determine the variation in
the culture content of product between countries; the authors term this differ-
ence as the International Cultural Content Difference (ICCD). The goal was to
address the degree of adaptation in the marketing efforts of a firm that may be
necessary to introduce successfully into a foreign market, a product with some
degree of cultural content (Madhuhar and Rajan,1996). The basic understand-
ing of cultural value orientation may be important when marketing product
and services to other cultures (George, 1993). One study evaluated the extent to
which value orientations were present in advertisments from the United States
and Mexico. The analysis showed that the majority of ads did not express core
cultural beliefs ( John and Partica, 1992). Another study analyzed the Chinese
in Hong Kong and reaches to the conclusion that the Chinese tend to conform.
They were more other-directed than inner-directed. The marketing implication
is that Chinese consumers tend to pay more attention to what is socially ap-
proved than what is approved by themselves (Kam, 1995). Another study ana-
lyzed the decision process used by consumers for buying color TVs in China,
how the product is used within the home, and its importance in modern Chi-
nese life as a symbol of economic and political freedom (Kathaleen, 1997). One
study proved that Japanese advertising would approach or surpass U.S. adver-
tising in the level of materialism evinced, since World War II (Russell, 1986).
The Methodology
The analysis used the following methodology:
1. A comprehensive study was made of six global brands through intensive
primary and secondary research. The strategies that the brands followed
in both Indian and global markets were studied, and the similarities and
differences analyzed.
2. A comprehensive list was drawn of factors, unique to the Indian market
and consumer, which any company entering India should take into ac-
count while strategising for its brand.
3. Six brands were chosen across categories. This was done to understand
the common factors in the strategies of these brands. These commonali-
ties can be used to create a strategy for a brand in any category. Three
brands in high-involvement categories and three in low-involvement cat-
egories were chosen for fundamental analysis.
Primary Research
Three focus groups (of eight members each) were chosen for each of the high-
and low-involvement brands. The first focus group comprised of people who
had purchased the brands under study. The second had those who bought a
competitor brand and the third consisted of a mix of people (four each), who
purchased the brand under study and also the competitor brand. This was
done to facilitate discussion with respect to the attributes that buyers sought
while making a purchase decision. Besides, in-depth interviews were done
with managers from BPL, Britannia and Volvo (automobiles). The primary re-
search was conducted to further probe the hypotheses built through second-
ary research. (A complete list of factors is given at the end of the chapter).
High- and Low-involvement Products

High- and low-involvement products can be defined variously. For the pur-
pose of the study, however, four major factors—price, purchase intervals,
perceived risk and personal/emotional involvement—will form the basis
for the definition. Products with high prices, higher perceived risk, high
purchase intervals and high emotional involvement are high-involvement
products. Products with lower prices and perceived risk, lesser purchase in-
tervals and lower personal involvement can be defined as low-involvement
products. Automobiles, watches and refrigerators were chosen as products
in the high-involvement category based on the above definition and laun-
dry detergents, breakfast cereals and jeans were put in the low-involvement
categories.
Selection of Global Brands and their Marketing Mix—

Entry Strategies in the Indian Context
High-involvement products and low-involvement global brands were selected
for analysis. The following brands were studied in the high-involvement
categories:
Swatch
Swatch, the flagship brand of the 3.6 billion Swiss francs Swatch group, has
embarked upon an aggressive marketing plan, and gradually built its pres-
ence in the Indian watch market. Swatch has a strong presence in the inter-
national market and is successful in a number of markets, including the
United States of America and Japan. The strategy of Swatch in the US mar-
ket reflects an interesting combination of marketing mix strategies. The prod-
uct is unique in design, uses transparent cases, mirror dials and plastic dials.
It comprises only 50 components and huge economies of scale have been
achieved by low-cost production. Thus, Swatch watches are very affordable in
the international market. Compared with other designer watches, Swatch is

priced low in the international markets. Close to 70 percent of its sales come
from the low-end market, and only 30 percent from the high-end segment.
Manufacturing and assembly is done in Switzerland. Swatch has distribution
networks in most medium-end retail stores as well as exclusive outlets. It is
promoted as a stylish, affordable watch that makes a unique design and fash-
ion statement.
The Brand's Indian Entry Swatch has carefully adopted a very different
strategy for the Indian market. The changes it made in terms of the marketing
mix elements are:
Product: Swatch found that the average Indian is a thrifty consumer and
seeks value for money even in luxury items. It has made attempts to slash its
costs even more to keep prices lower. So, Swatch is doing its assembly in India.
The countries where it outsources its assembly are Brazil, India and China.
The latest Swatch collections will be available in India as and when they are
launched in international markets. Currently, Swatch markets its international
product-line in India. Due to the cultural differences, however, it is working
with designers to develop Indian themes for its products.
Price: Swatch prices range between Rs 1500 and Rs 5000—at par with Titan,
the market leader. However, even this price range is considered high in India.
This is in contrast to global markets where Swatch prices are considered afford-
able. Clearly, the target segment in India is different from the one overseas.
Place: Swatch entered the Indian market with a strong focus on building
top-of-line distribution, beginning with the prominent metropolitan cities and
gradually reaching the state capitals. Thanks to its aggressive focus, Swatch
has quickly built an admirable presence in over 60 outlets in the top cities, with
two exclusive stores in Delhi and Mumbai. It has entered into alliances with
Shopper's Stop and Planet M and has gained exclusive presence in stores like
VAMA, Eternia, Benzer in Mumbai and Ebony in Delhi. The key difference is
that Swatch in India has its distribution outlets in the upper-end segment, as
against the mid-priced outlets that it uses overseas.
Promotion: Swatch's promotion strategy is based on a phenomenon

unique to the Indian market—it aims at being an aspirational product and
concentrates on building itself as a brand, which gives the consumer an “inter-
national experience”.
The target segment of Swatch worldwide has been the youth or the young
at heart. However, its high prices in India define its target segment differently
in India. It has widened its target segment to include trendy and product-
conscious women and working men as well, who prefer casuals at times, and
want a watch to go with their Allen Sollys or Color Plus. Its target segment is
Indian families with incomes more than Rs. 50,000 per month. This puts Swatch
at the very high-end of the market. Culturally, there is a marked difference in
communication. While Swatch is positioned as an individual expression the
world over, it uses festivals times like Diwali and Durga Puja when people spend
more in its communication campaigns in India.
Santro
In the Korean market, Hyundai's Atoz (what is Santro in its Indian avatar)
competes with Daewoo's Matiz. However, the results in the Korean market
are quite different as compared to the Indian market. The Matiz far outsells
the Atoz in Korea and other Asian countries. In India, however, the Santro
has notched up far higher sales compared to the Matiz. The “tall boy” de-
sign and excellent service of the company in India has augmented the brand
significantly. The brand has gained considerably from the positive word
of mouth in a short period of time. It is almost two decades since Maruti
redefined the passenger car in the Indian context, where it is the leading
automobile brand. Santro has achieved considerable success in the “small”
segment defined in the price range between Rs 3–6 lakh. Santro's strategy
illustrates well how an MNC brand, virtually unknown in the Indian con-
text, has succeeded by providing value to the target segment in spite of
limited distribution as compared to Maruti. The brand also effectively used
celebrity endorsement in conjunction with the “value” proposition in its
communication.
The Brand's Indian Entry Hyundai made the following changes in its
marketing mix elements for its Indian entry:
Product: Hyundai specifically designed Santro for the Indian market after
intensive research into the tastes of Indian consumers. The factors that came
out clearly and dominantly in the research: price, space, performance, com-
fort and safety. Considering that a small car can have only that much space,
Hyundai concluded that the only way to make its car look spacious was to
increase the height. That also gave Santro a radically different look. In conson-
ance with the poor quality Indian fuel, Hyundai changed the MPFI (multi-fuel
point injection) calibrations and reprogramed the engine control unit. While
most manufacturers are moving to four valves (for performance), Hyundai
retained the three-valve cylinder for trade-off between power and economy.
It correctly understood the Indian consumers in that economy matters more
to them. Bearing in mind the Indian traffic conditions, Hyundai gave Santro a
higher torque at lower rpm, which means fewer changes in slow traffic.
Price: Santro staged a pricing coup of sorts by pricing its basic version at
just Rs 2.93 lakh, only Rs 49,000 over the Maruti 800 cc, in spite of it being a
1000 cc car in the same class as the Zen. The company correctly understood the
Indian consumer as being price-conscious, interested primarily in the value

for money option.
Place: Hyundai has an existing network of 70 dealers, who have invested

close to Rs 300 crore. Transporters have done their bit to rev up the supply
chain to get Santro on to the roads. Hyundai claims that a large number of its
dealers are either MBAs or engineers. It argues that this has helped in provid-
ing the brand with credibility and a positive word of mouth. This, perhaps, is
evident in the fact that almost 40 percent of Santro's sales come through refer-
rals. Specific to the Indian culture, even for high-involvement products like
automobiles, a positive word of mouth or referrals play an important role in a
purchase decision.
Promotion: The one thing that worked best for Santro is its promotion,
especially its advertising campaign featuring film celebrity Shah Rukh Khan.
Due to the unique cultural traits of Indian society with its stress on trust and
people, peripheral cues such as celebrity endorsement acquire more import-
ance than central cues such as information about the product and cognitive
knowledge about it. Santro effectively used the film celebrity to build a rap-
port with consumers, and then talk about the benefits of the car. Thus, the first
stage in Santro's promotion was building trust. Subsequently, they reinforced
the trust with comparative benefits, which established the supremacy of San-
tro over other cars. However, they were careful in not comparing Santro with
Indica, which was riding high on the nationalistic sentiment (because of the
ethnocentrism of the Indian consumers).
Whirlpool
Whirlpool, born in the USA, has today established a global presence. It moved
aggressively into Europe when it purchased a 53 percent stake in the appliance
line of Philips. It followed the same model when it arrived in India, doing a
joint venture with the TVS group. The success of the brand in India has been
largely due to the research the company did with regard to the cultural differ-
ences between the developed markets and the Indian market. Cultural differ-
ences in such categories (like refrigerators and other durable appliances) show
up in terms of expectations about the product, usage of the product under spe-
cific conditions (like the type of foods consumed, beliefs and preferences about
how they should be preserved in the case of refrigerators) and the perceived
value of the product. Whirlpool introduced flexible chambers in its refriger-
ator, which can be used to store food in accordance with the volume of different
kinds of food. It advertised that its refrigerator can make ice really fast, which
is one of the basic expectations from a fridge in the Indian context. The adver-
tisement also introduced a status appeal in communicating the benefit of mak-
ing ice quickly. This status appeal resonated well with the urban Westernised
markets of India. The company also revamped its distribution structure and
created the appropriate “pull”, which was in synchronisation with its “push”
strategy.
The Brand's Indian Entry Whirlpool's marketing mix elements were

changed for the Indian context to the following manner:
Product: Whirlpool manufactures washing machines and refrigerators in

India. It has an R&D centre in India, where top-loading washing machines are
designed specifically for the Indian market. It has also designed refrigerators
to cater to Indian conditions. For example, its refrigerator can take heavy vari-
ations in voltage—a condition peculiar to India. Whirlpool imports its prod-
ucts for most Asian markets. But it manufactures them in India to avoid tariff
barriers (25–30 percent), which will jack up its cost and therefore, the price of
its products.
Price: Whirlpool products are priced competitively, particularly in the In-

dian market where the consumers are extremely cautious while making a big
purchase. It has also launched a zero-interest finance scheme to penetrate the
washing machine market. It is important to note here that the Indian consumer
tends to postpone buying high priced purchases. This is in sharp contrast to the
American buyer who decides easily. Thus, an added incentive in the form of a
zero interest loan succeeds in attracting the consumer to make a purchase.
Place: In terms of distribution, the Indian market is rather spread as against

the US market, where retail sales are split evenly between Sears (33 percent),
major national dealers (33 percent) and smaller local shops (the remaining
33 percent). In India, Whirlpool initially partnered with TVS to leverage its dis-
tribution strengths, and currently has a distribution network of 4500 dealers
throughout the country. Whirlpool expands this network by adding about 300
to 500 dealers every year.
Promotion: It may be worthwhile to consider the strategy used by Whirl-

pool, namely, the application of cultural values to advertising in the durable
category. Whirlpool has made extremely good use of its understanding of the
Indian consumer by launching promotions catering to the specific cultural traits
of the consumers. Its advertising campaigns are not product centric. Instead,
they seek to promote emotional benefits, which is what the Indian consumer
can closely relate to. Whirlpool uses the “feel-do-learn” advertising model in
India as against the “learn-feel-do” model in the US. In the former, the brand
first concentrates on building a relationship with the consumer, and then on the
benefits of the product. In a collectivist, feminine and traditionalist society like
India, the feel-do-learn model works better because Indians place a premium
on building trust. Whirlpool, in this model, uses family settings in consonance
with the collectivist nature of the society. The woman in their ads is the hub
of the family, and whether it is super clean washing or making ice “real fast”,
she is the “magician”. Cognitive performance attributes and product benefits
take the backseat in such communication. In fact, a major reason behind the
success of Whirlpool is its ability to connect with the value of its consumers.
Low-Involvement Products
Levi Strauss
To begin with, Levi Strauss was a major failure when it was launched in India
in 1995 as its high prices and sparse distribution network put off their tar-
get segment. Levi's was the first American jeans and has retained its status
as the most favuored jeans brand, except for brief phases now and then. Levi
Strauss pioneered jeans in the world and today it has extended its productline
to include new brands like the Dockers clothing line, Wide Legs, 501's and
women's jeans as well. The brand is priced at the upper end of the jeans market
and commands this price by virtue of being the first jeans brand in the market.
This, obviously, gives it a unique positioning advantage. However, its prices
are comparable to the other brands as well. Levi's has a strong distribution
network in the US. It has had to reposition itself because it was beginning to
get trapped in an “old fashioned” mold. It is an image oriented reposition-
ing wherein it stands for individualism and freedom to recapture its original
“glory” as a “cool” jeans brand among the youth. The advertisements have
become much bolder so they can appeal to the youth. The stress is still on the
original American conception of the Levi's as the jeans of the cowboys, build-
ers and rebels. The target segment includes both the young and the young at
heart, irrespective of their age.
Levi's came very late to Japan. By the time, many brands had already
entered the market and positioned themselves as the original American jeans.
So, Levi's positioned itself as the legendary American jeans with the theme
“Heroes Wear Levi's”, featuring clips of cult figures, such as James Dean, who
were popular in Japan. Since the Japanese society is primarily “other directed”
in nature, and Hollywood stars have a unique aspirational appeal, the pos-
itioning went down well with the Japanese. As a means of promotion in Japan,
Levi's changed its standard communication and positioning of a “freedom-of-
expression” and individualistic wear to a more acceptable level of social orien-
tation. Also, the subtle humour in American advertisements is absent in the
Japanese campaign reaffirming the supposition that cultural values, including
humour, cannot be universally transferred.
In India, the brands also mention the price (it has introduced offerings
below Rs 1000) to combat the perception that the brand is very expensive. This
is likely to increase the store traffic.
The Brand's Indian Entry The brand's Indian entry was preceded by
the following changes in the marketing mix elements:
Product: Levi's launched only jeans to begin with, but it has now followed
up with other product-lines like Dockers and 501's. Levi's had the advantage
of being known as the original jeans brand, when it was launched. However,
it soon lost the advantage because of incorrect choices of the other marketing
mix elements.
Place: Levi's was launched only in 27 exclusive retail outlets, initially. How-
ever, this scared away most teenagers since they thought that the jeans would
be very expensive. Since 80 percent of the Indian market comprises teenagers,
Levi's had to rethink its strategy. It decided to use multi-brand outlets like
Blues Bizaar or Shopper's Stop, and increase the number of outlets to 70 in
1999 itself. It has now doubled its outlets. At one point of time, the company
was concentrating only on the Original Levi's stores with additional distribu-
tion through about 30-odd Weekender outlets.
Price: Levi's was positioned initially as the “aspirational” American jeans,

priced at Rs 2000 plus. But the cultural uniqueness of the Indian consumer is
that howsoever aspirational a product might be, he/she still seeks value for
money. The Indian consumer shunned the jeans at this price and Levi's had to
introduce jeans at lower prices. It now has jeans in the price range of Rs 995
and Rs 2,295.
Promotion: All Levi's advertisements promoting the Rs 995 range feature

women prominently. This is because, the core buyer of Levi's are men who are
extremely brand conscious and believe that wearing Levi's puts them in an
exclusive club. Women, on the other hand, form just 20 percent of its buyers.
If Levi's promotes the low-priced jeans, the brand conscious male, who is the
core buyer as defined by Levi's, may simply dump the brand if he thinks Levi's
is becoming less exclusive. Levis is still an aspirational brand to him and he
would not want to lose it.
More importantly, the cultural differences between the Indian and Western
societies stand out clearly in the advertising campaigns. India is, perhaps, one
of the few countries in the world where Levi's is not standardising its adver-
tisements. The brand subsequently launched a new campaign with Indian ele-
ments, like local trains and dhobis, to appeal to the family-oriented, collectivist
and ethnocentric nature of this society.
Surf
Surf is one of the leading detergent brands of Unilever, and has been suc-
cessful in various cultures and countries. In India, a higher-priced variant of
Surf – Surf Excel – has been launched, apart from Surf. That, too, has been
successful. Surf has been a household name for the last several decades,
ever since detergent powders were introduced in the country. While a huge
market for washing soaps still exists in India, Surf has, over the years,
successfully sold the concept of powdered detergents despite the fact that
the market for compact detergents like Surf Excel is still a small niche in the
country. Whiteness was the pioneering proposition of the brand drawn from
the cultural belief that the test of powder lies in the whiteness of clothes.
The brand faced stiff competition from Nirma in the late eighties, a value-
based detergent powder, which created discontinuity at the lower end of the
market offering itself at a price strikingly lower than that of Surf. Surf re-
sponded by running the “Lalitaji” campaign. This character was the stereo-
typical Indian middle class housewife. The campaign captured the cultural
flavours of haggling to get the best in commodity purchases—a cultural
behaviour associated with Indians in almost all parts of the country. The ad-
vertisement positioned Surf as an offering, which washed more with far less
(powder) than any other competitive brand and should a smart housewife
like “Lalitaji” choosing Surf over all else. This was a typical example that
used in its communication a common cultural trait. The brand continues
to hold a significant market share in the category closely competing with
Nirma. Surf has also used its equity to launch higher-priced variants like
Surf Excel and Surfomatic.
The Brand's Indian Entry Since we have already discussed Surf, let us
look at the marketing mix elements for Surf Excel:
Product: Surf Excel is available in India in a solid-scented powder form.

The powder is crystal-white with flakes of blue thrown in good measure to
indicate the presence of blue (traditionally used by housewives). The flakes of
blue are primarily there to keep the Indian housewife's belief that her deter-
gent contains blue. This is because India is rooted in tradition and the house-
wife still believes that the traditional methods of cleaning are relatively more
effective.
Price*: Surf Excel is priced in the premium segment of detergents at Rs 140

per kg while Ariel is priced slightly higher at Rs 155 per kg. The mid-priced
variant of Surf (Surf Fluffy) is priced at Rs 80 per kg, and is in competition with
another Lever brand called Rin.
Place: Surf Excel uses the well entrenched network of Hindustan Lever
Limited, which ensures its distribution in every corner of the country. The
customer-base of Surf Excel is mostly in the urban metros and other big cities,
called Socio-Economic Classes A and B.
Promotion: Both Surf Excel and Ariel are positioned as stain removers,
but what really sets the former apart is its promotional activities, specifically
* The given values are prices prevalent at the time when the study was undertaken.
advertising. Surf Excel correctly captures the Indian cultural traits of collect-
ivism towards family, tradition and femininity in its advertising campaigns.
These are tailored completely to suit the Indian consumer. Beginning with
“Lalitaji”, down to its present punch-line “Surf Excel hai naa”, the campaigns
for the brand have struck the right cord with the consumers. The campaigns
are drawn from the Indian values of family and nurturing, and children have
always been part of most of its advertisements.
Peripheral cues acquire a lot of significance in low involvement products
like detergents. Surf Excel has gained an entry into the consumer's mind on the
basis of the emotional benefits it offers. Since India is, essentially, a collectivist
society, housewives are shown to receive appreciation from their husbands
and families when the clothes are washed properly. The advertisements also
use the “other directed” nature of Indians by showing a man more successful
at work or receiving greater acceptance by others due to cleaner clothes etc.
Kellogg's
Kellogg is a leading food products company based in Battle Creek, Michigan.
The company produces a wide variety of ready-to-eat cereals and other food
products. In India, it makes cereals from three types of grains – corn, wheat
and basmati rice – and has launched its Frosties and Cornflakes line of prod-
ucts. The brand's entry in India drives home interesting points in marketing
new foods to a specific culture, one of which is that eating habits need to be
changed rather than making a direct attempt to market any new food. This is
because eating habits are a strong part of any culture and care should be taken
to ensure the brand does not alienate itself from the consumers in the process
of marketing itself. It is difficult to think of a successful food brand in the
Indian context other than Maggi noodles. It is interesting to look at the pos-
itioning of Maggi vis-à-vis Kellogg's. Maggi positioned itself for children as a
fun snack, which could be made in “two-minutes”. The brand was very suc-
cessful in the eighties as the positioning also had an impact on urban mothers,
who had a number of chores to do and were also concerned about a snack for
their children some time in the day. Most importantly, from the point of view
of culture, the brand never tried to alter the existing habits of consumers by
positioning itself as a substitute. Kellogg's positioned itself as a healthy break-
fast substitute. It also slammed the oily foods, which have ruled the country
palate for generations, as unhealthy. This proved to be “anti-cultural” in terms
of selling the concept. That Indians liked their milk hot even in cornflakes,
never mind if it made them soggy, only complicated things for Kelloggs. The
price was too high for this new “substitute”. Most of those who bought the
brand did not buy it again. So, the repeat buy for the brand was low. All in all,
Kellogg's strongly back-fired. Cultural beliefs, more than logic, have to be ad-
dressed especially in categories like snacks, fast foods or any product with a
new taste (“new” as perceived by consumers in a cultural setting). The brand
has, in the recent times, introduced its offerings in low-price variants and some
of them in ethnic flavours.
Interestingly, the brand has introduced biscuits in an apparent bid to return

to the market through children after its earlier positioning as an alternative
breakfast failed with Indians.
The Brand's Indian Entry

Product: Kellogg's cereals in India consist of Cornflakes and Frosties.
Indians have strongly entrenched beliefs and preferences with regard to food.
Their preferred breakfast comprises parathas with fillings of sattu, potatoes or
cauliflower. To stay on the right side of Indian tastes, Kellogg is selling cereals
made from corn, wheat and basmati rice. But Indian breakfast habits being
what they are, Kellogg has faced strong resistance to its products, particularly
because it seeks to change these habits. Characteristic of Indian breakfast hab-
its is that they like to have their meals with hot milk. Besides, Kellogg's pos-
itioning on crustiness loses its meaning because the flakes get soggy in warm
milk, which is what Indians prefer.
Price: The initial pricing of Kellogg's products was an exact equivalent of

dollar to rupee (conversion) pricing. Kellogg's packs, which were priced at
Rs 40 for a 500 gm pack, were 80 percent more expensive than their Indian
counterparts. Consumers lapped up the product to begin with, taken in by the
attractive package . But soon they, particularly the lady of the house, realised
that it did not provide value for money. No housewife wants or can even af-
ford to spend Rs 40 every two or three days. They switched to local brands like
Mohun's, or stopped eating cornflakes altogether.
Of late, Kellogg has realised that it had failed in the pricing strategy.
The consumer's perception was that Kellogg did not provide value for
money.
Place: Kellogg has restructured its distribution network right now. To begin
with, it has decided to concentrate on building the network in urban centers
and metros.
Promotion: The brand has positioned itself as a fat-free alternative to In-

dian breakfast for both adults and children. It is also positioning itself as a
wholesome diet for children, establishing itself on the energy platform. Its
communication strategy is based on the mother–child relationship, which is,
perhaps, of utmost importance in Indian culture, and on the values of nurtur-
ing and caring. Thus, the communication shows a mother feeding Kellogg's to
her children. This is in contrast to Kellogg's strategy in the US where providing
cognitive information regarding breakfast cereals, particularly the nutritional
value of Kellogg's, is primary. The same marketing strategy has been applied
in most European countries where product benefits, details of quantity and
content of fat, proteins and carbohydrates is what people look for when they
buy cereals.
Analysis from Primary Research

Specific Brand-related Factors All the six brands in the secondary re-
search were analyzed in the focus group discussion and in-depth interviews.
The following key factors have emerged therefrom:
Swatch: The single most important factor that is responsible for the suc-
cess of Swatch has been the product. Swatch is stylishly designed to cater
to the Indian youth/young at heart and the respondents seemed to iden-
tify with it. The respondents also felt that the product gave them value for
money.
Levi Strauss: Due to its initial marketing blunder, Levi Strauss is still per-
ceived as very high-priced jeans. The respondents viewed jeans as being a
low-involvement purchase, and are not willing to spend a lot of money on
it. However, Levi's positioning as an all-American jeans appeals to the aspir-
ational needs of the youth.
Santro: Santro's advertising has been singularly successful. The respon-

dents had a high recall and the advertising influences their purchase decision.
This reinforces the role of celebrities in India. A celebrity is required even in a
high-involvement purchase like automobiles to create a relationship with the
consumer before the product attributes can be enlisted.
Kellogg: According to the respondents, Kellogg is rather expensive, and

once again, they were not willing to spend that much money for a low-involve-
ment purchase like cereal. They were divided in their opinion as to whether
they would replace their “traditional” breakfast with the new cereal. They also
felt that Indian breakfast is more nutritious. It was clear from their response
that food habits among Indians are deeply entrenched and almost all of them
resisted the changeover.
Surf: The respondents preferred Surf over other detergents, because of the
relationship that Surf has established with its consumers. They were unani-
mous in saying that Surf stands for a bond of trust, which Ariel has not been
able to forge with consumers.
Whirlpool: The respondents were drawn towards the brand's family-

oriented communication and its positive features, which were perceived to
be in tune with the needs of the Indian consumers. The feeling of trust and
warmth generated by the advertisements that featured the “lady of the house”
also helped in enhancing the family orientation.
Global vs Local Brands

Of the six brands—Surf, Swatch, Whirlpool, Santro, Kellogg and Levi Strauss
the respondents only knew of the last three as global brands. They felt that
a brand being local or global impacts their purchase decision in a low-
involvement product like detergents. A global apparel brand stands for better
quality, lifestyle and has more aspirational value than a local brand. In high-
involvement technology-oriented products, the consumer is deeply affected
by a global brand. He/she relies on the specific associations he/she has with
that country when buying the brand. For example, the Japanese are associated
with developments in technology and high quality. Hence, a Japanese product
is synonymous with technological superiority. Similarly, the West is known for
its style and fashion. Hence, the consumer associates products from the West
with greater style and fashion consciousness. Consumer ethnocentrism plays
an important role as most respondents were very emphatic about patriotism.
They felt that patriotism is a value that every Indian should have, and the con-
sumers would easily accept any brand, which rides the “nationalistic” wave.
Individualism vs Collectivism
The responses obtained from the focus group discussion clearly show a distinct
pattern of collectivist thoughts and concerns of the respondents. On almost all
the factors being tested for individualistic versus collectivist content, the re-
spondents scored very highly on the latter. The distinct patterns obtained are:
(a) In almost all purchase decisions made in high-involvement products, the
family makes the purchase collectively by taking into account the views
of friends/relatives etc. In some of the purchases, the decision maker did
not personally like the product. But he/she purchased it because family,
friends and relatives were for buying it.
(b) The respondents clearly stated that they valued relationships a lot, and
that was perhaps, the single most important feature in their lives, even
more than their ambitions and desires.
Family Orientation
The focus group discussion revealed a high degree of family orientation
among the respondents, though it did vary with age. However, family values
came across as the dominant factor in an individual's life. The key factors that
emerged were:
(a) Most of the respondents lived in nuclear families but had a lot of affec-
tion for their relatives.
(b) The respondents said they made it a point to meet/exchange greetings
and gifts with their relatives/friends on occasions like Diwali and Holi.
(c) The immediate family – or the family that an individual lives in –

was very important in the respondents' purchase decisions for high-
involvement products. The safety, concerns and needs of the family were
considered while making such purchases. They were willing to sample
and try low-involvement products on their own but also paid some
thought to the family's views. The respondents said that they preferred to
discuss the relative merits/demerits of a brand if their purchase decision
was different from that of their family even if they are fully convinced of
their choice.
Masculinity/Feminity
The views of the respondents clearly pointed to the feminine aspect of the
Indian society.
(a) The respondents clearly said that the dominant value that governed
their lives was care and trust rather than success and ambition.
(b) The respondents preferred communication, which included expressing
feelings and emotions, though product attributes were also significant.
Time-Orientation
The respondents appreciated convenience in high-involvement products.
These were technology-intensive products and the respondents were not very
comfortable with technology. They expected the products to be easy to use.
They were, however, divided in their response for low-involvement products.
Some wanted convenience and others, performance. For example, some of the
respondents preferred Kellogg's cornflakes because they were easy and a con-
venient substitute for breakfast. However, the others felt that it lacked nutrition
and preferred a more wholesome breakfast even if it took more time. Trad-
itional remedies did impact the consumer's mind though scientific evidence
was also important. Most respondents accepted time-tested remedies as useful.
Other-directed vs Inner-directed
The respondents clearly stated that the views/ideas/thoughts of others had a
significant role in their purchase decisions. They preferred to purchase prod-
ucts/brands that others had recommended, and wanted very much the ap-
proval of others for what they had bought.
Celebrity Usage and Attitude Towards

an Advertisement
It emerged from the focus group discussion that celebrities had a significant
impact on the purchase decisions. In high-involvement products, celebrities
established a relationship with the brand for the consumers, though the purchase
decision was influenced by product attributes. In low-involvement products, ce-
lebrities helped increase the recall value of the brand in the advertisement. The
choice of celebrity and his/her association with the product attribute was rated as
very important in high-involvement products. An interesting feature that came
up in the analysis was that the respondents remembered the advertisement more
than they did the product attributes explained in it. They could recall, specifically,
the mood and emotions in the advertisement rather than the product attributes.
Observations on Certain Cultural Aspects

The researchers identified a set of cultural traits unique to India, which were
different from those elsewhere in Asia, the US and Europe. Any company,
which intended to launch a brand in India, should take into account the fol-
lowing cultural traits to formulate its marketing strategy.
Collectivism
Indians have a marked collectivist culture, as both primary and secondary
research shows. Thus, the purchase decisions of Indians express collective
concerns rather than individual ones. Further, collectivists tend to value rela-
tionships. The role of friends, family, relatives and others is very important in
the purchase decisions. This is in contrast to the Western society, where indi-
vidualism rules the day. Indians mostly reject things of individualistic concern.
This trait, then, translates into their preference for product communication. In-
dians prefer communication which shows the effect of a product on a group of
people rather than an individual in both high- and low-involvement categories.
Family-Orientation
Family and relationships are very important to Indians. Their purchase deci-
sions are influenced greatly by the family sacrificing personal tastes or choice.
The safety, concern and needs of the family are most important while purchas-
ing a high-involvement product.
Feminity
The Indian society is dominantly feminine in nature, with the dominant values
being nurturing, care and trust rather than success and ambition. This prefers
communication, which display a lot of feelings and emotions.
Time-Orientation
In contrast with the Western society, which is future-oriented, India is a tra-
ditionalist society. Indians still believe in traditions and in old remedies.
A product which positions/communicates the value of tradition has a good

chance of making it. This also reveals the Indian values of care, rather than
ambition and aggression.
Convenience
Convenience is appreciated in high-involvement products. These products
are technology-intensive and the respondents were not very comfortable with
technology. Hence they expected the products to be easy-to-use and operate
technologically. Even more importantly, in positioning strategies, the Indian
consumer is affected more by communication, which intends to build a rela-
tionship with the consumer rather than talk about product attributes.
Other-Directed
In India, the views/ideas/thoughts of others have a very significant role in
their purchase decisions. Indian consumers prefer to purchase products/
brands that have been recommended by others and are very conscious of oth-
er's approval of their purchase decisions. This is evident in the fact that repur-
chase in India is based more on advertising, rather than the satisfaction level
with the product itself. The consumers need re-enforcement of their purchase
decisions through advertising.
Neo-Lifestyle Orientation
Even though India has opened up a great deal to Western influences and way
of life, there is still a tendency to reject the latter. Any communication, which
tries to create an aspirational value for the brand based on Western permis-
siveness, runs the risk of alienating the Indian consumer.
Consumer ethnocentrism plays an important role, as most Indians are very
emphatic on the values of patriotism. They believe that patriotism is a value
that every Indian should have, and the consumers would eagerly accept any
brand, which rides on the nationalistic sentiment. A local/global brand has
an impact on their purchase decision in a low-involvement product like deter-
gents. In apparel, the impact of a global brand is that it signals a better quality,
lifestyle and aspirational value than a local brand. In high-involvement tech-
nology oriented products, the consumer is very deeply affected by the brand
being global and he relies on his image of specific associations with a coun-
try in his purchase decision. For example, the Japanese are associated with
developments in technology and high quality, and hence a Japanese product
is synonymously associated with technological superiority. Similarly, the

West is known for its style and fashion statements and hence the consumer
associates products from the West with greater style and fashion conscious-
ness.
The Framework
A framework on cultural aspects and branding can be formulated as given
below. It may further be repesented as shown in Figure 4.1.
Ritualistic Masses Low-involvement products like detergents and food

categories strongly reflect entrenched Indian cultural traits like “value”-based
buying (detergents) or eating habits that are part of a country's collective
habit/belief. MNC brands should position themselves on “value” in cat-
egories like detergents, and, perhaps use “family” (in the form of benefits
to the family by using the brand) in their communication. The objective is
to provide value and create emotional linkages that reinforce feelings and
emotions common to the culture. In categories like food or beverages, MNC
brands should not position their offerings as a substitute for existing offer-
ings (as Kellogg did when it came to India). The brands in such categories
can position themselves as snacks to be eaten along with the existing offer-
ings. Creativity in positioning involves creating linkages between existing
foods and the MNC offerings in terms of “taste combinations” as perceived
by consumers. Pricing should be comparable with existing offerings and
the distribution strategy should ensure that the MNC offerings (like cereals,
which may be new to most consumers) are displayed in shops along with the
traditional ones. This will create a perception that the new offering belongs
L *CO H
L 2 1
Involvement *Co-cultural
levels Orientation
H 3 4
1. Ritualistic masses 2. Global followers 3. Glamour trialists 4. Hardcore culturists
Figure 4.1  Branding and Cultural Dimensions.

to the existing product category and also result in a subsequent trial. Sales
promotion should be attempted (preferably with existing offerings) to initi-
ate trials. Given the strong links with old habits, an ethnocentric approach
may be effective. An MNC brand can position itself as an offering that has
been exclusively developed for the Indian consumer.
Global Followers There can be certain products like jeans that may be of
“passing involvement” (which cannot be categorised under heavy involve-
ment). The involvement in these categories ( jeans or sunglasses) is main-
ly because of their Western orientation and their ability to make a “fashion
statement” (symbolic involvement). But this can, and often does change with
time. MNC brands have to also ensure that the fashion-oriented communica-
tion is not perceived as permissive. These brands also have to launch offer-
ings at the lower end of the product-line for the affordability of consumers,
and ensure that distribution costs do not jack up the prices. The ability of
MNC brands to create a “fashionable but affordable” perception holds the
key to success.
Glamour Trialists MNC brands operating in durables like automobiles

or watches may be low on cultural orientation but still be high-involvement
categories. This may mean two things—either the product category is low on
cultural orientation and high on value (like Swatch) or it is lower on cultural
orientation compared to its functional attributes. Santro, for example, can have
a “peripheral cultural orientation” as reflected by the celebrity communica-
tion, which may bring the brand into the consideration set of consumers. But
the final success of the brand depends on functional attributes and is possible
only if they have been adapted to the Indian context.
Hardcore Culturists There can be certain high-involvement categories

like refrigerators and washing machines, which may appeal to consumers if
(a) a high degree of value is provided through some new features developed
for the Indian context (which contribute to convenience); (b) such offerings are
competitively priced in a way that consumers perceive value for money even
if these are not at lower price points; and (c) the marketing communication
reflects a high degree of cultural orientation (like the feeling of warmth, focus
on the family's well-being), and addresses women who exert considerable in-
fluence over purchase decisions. Whirlpool adopted this approach in India.
Another MNC brand, LG, which holds about 37 percent of the market share
(leader) in the premium segment of refrigerators (above 300 litres), also fol-
lowed the value-based approach (value at a higher price point with the state-
of-the-art features) and its communication highlighted the health benefit to
the family.
The framework and methodology used provides an approach, which can
be adapted to several product categories.
Complete List of Factors Tested Through Focus

Group Discussions and In-depth Interviews
1. Specific brand-related factors
(a) Why did you choose this brand? Did someone refer it to you/where
did you first hear about it?
(b) Do you think it is reasonably priced?
(c) Do you think its quality is good/as per your requirements?
(d) Was it easily available?
(e) What do you think of its advertsing? Do you remember the adver-
tisement? What features do you remember of it?
(f) Reiterate the one single factor that stood out when you bought this
brand?
(g) What about the competitor brand (check on all 4 P's)? Why did you
not buy it?
(h) Under what conditions will you buy the competitor brand? How
can they make the brand more desirable to you? What particular
feature can they change to make you purchase it? (Once again, con-
centrate on all the 4 P's to evaluate which element of the marketing
mix should be altered).
2. Global brand vs Local brand
(a) Are you aware that this brand is not Indian in origin?
(b) If yes, does it have any impact on your purchase decision?
(c) If no, what are your feelings, now that you know?
(d) What are the images that go through your mind when you hear
about a global brand vis-à-vis a local brand—better/lesser quality?
(e) Do you feel any emotional relationship with a local brand—of pa-
triotism, care, trust etc?
3. Cultural factors
(a) Individualism vs Collectivism
1. Who do you consider most important in your purchase deci-
sion—the opinion/comforts/conveniences of others or yourself?
2. What is the kind of communication that appeals to you—the one
that shows people or the one that concentrates on the individ-
ual?
3. Is your success and ambition more important to you or your
family?
4. Do you value your relationships a lot? If yes, will you uphold

them even at your own cost?
(b) Family-orientation
1. Do you live in a joint/nuclear family?
2. What are the things you usually do together as a family?
3. Is festival time special to you? Do you purchase gifts for your
family/celebrate festivals with your family?
4. Was your purchase decision influenced by your concerns/
opinions of your family?
5. Do you like communication which shows rebelliousness?
6. Do you like communication which shows care for the family as
a dominant value?
7. Do you and your family often shop together? If yes, which
places do you visit and what products do you buy together?
8. How important is your family in most of your crucial decisions?
9. Do you check the safety of the products you buy for another's
usage and consumption?
10. Do you have the same sense of belongingness to your close

friends as to your family?
11. How often do you give and receive gifts from your family?
12. Will you use a brand recommended by a member of your
family – simply based on the sense of belonging – or discuss
the relative merits/demerits of the brand?
(c) Masculinity Vs Feminity
Given a choice, will you prefer care as the dominant virtue or suc-
cess and ambition? To what extent do you like feelings and emotions
to be portrayed in advertisements?
(d) Time orientation
1. Do you prefer buying futuristic products, which promise to
take you closer to the future?
2. To what extent do you think convenience matters, both in low-
involvement and high-involvement products?
3. Do you prefer products that are based on time-tested, tradi-
tional ideologies or those based more on scientific evidence?
(e) Other-directed Vs Inner-directed
1. Does the opinion of others make a lot of difference in your pur-
chase decisions?
2. Which are the products for which others' opinions make a lot of
difference?
3. You have bought a product and are satisfied with its comfort
and performance. But the others do not look upon it favourably.
Will this alter your subsequent purchase decision?
4. Who matters most in your purchase decision—family, friends,
peer group etc?
(f) Celebrity-usage and Attitude towards an Advertisement
1. Can you recall some current advertisements?
2. Do you think celebrities should be used in advertisements?
3. Are you impacted positively/negatively by a celebrity in an ad-
vertisement?
4. Name some brands. Do you recall the product features, as dis-

played in the advertisement? What are the features of the brand
that you remember? What do you remember about the adver-
tisement?
(g) Neo-lifestyle Orientation
1. Will you accept the typical lifestyle of Westerners?
2. Do you believe that married women should be encouraged to
pursue professions of their choice (rather than live as stereotypi-
cal housewives)?
3. Do you feel that the present generation should marry irrespec-
tive of cultural/social/religious/nationality barriers?
4. Do you think that anyone in your immediate social circle should
feel free to live the life he/she chooses if it does not interfere
with others (even if it is not in tune with cultural practices)?
For In-depth Interviews with Company Heads

1. What are the factors you considered when you launched this
brand in the Indian market?
2. What are the factors on which the launch strategy differed from
global markets—in terms of product, price, place and promo-
tion?
3. Which seasons do your sales peak in?
4. Which cultural factors, do you think, are specific to the Indian
context—ask about each of the cultural factors mentioned above?
5. What do you think your brand could have done differently at
the launch stage itself?
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www.ipan.com/press/2000sep/1409sw.htm
www.essential.org/monitor/hyper/mm0795.04.html
www.ipan.com/press/2001july/0907lev.htm
www.thetimes100.co.uk
www.Sanfrancisco.bcentral.com/sanfrancisco/stories/2001/01/08/editorial3.html
5
1
Research Dimensions on
Point of Purchase*
S. Ramesh Kumar,
Rajeev Ravi and
Jeevish Jain
As India moves into modern retailing, with several changes happening to its
markets, brands and consumers, there are unique challenges that a multi-
national company entering India has to cope with, whether it is a fast moving
consumer goods (FMCG) company or a multinational retail chain like Tesco
or Wal-Mart. There are unique retailing aspects that need to be studied in
detail by these companies. While retail density (number of shops per 1000
consumers) is on the decline the world over, retail density in India is on the
increase. This is because of the fact that small neighbourhood shops called
kirana shops, of which there are about 11 million in India, have been a part
of the Indian shopping culture for several decades. Even toady, organized re-
tailing (modern retail outlets) contribute just 2–3 percent of the total retail
sale in the country. Point of purchase (POP) materials are used both by kirana
shops and by organized supermarket retail outlets. This study investigates
the impact of POP materials on kirana shop purchases and the purchases of
consumers from supermarkets. Given the importance of POP material on the
purchase of FMCG purchases, the authors feel that this study will be useful
to bridge the gap between theory and practice and provide valuable insights
to managers involved in retailing.
Keywords: point of purchase, fast moving goods, impulsive purchases, brand aware-
ness, emerging markets
* This reading was first published as Ramesh Kumar S., Rajeev Ravi, and Jeevish Jain (2007), “The Role of
Point of Purchase in Shopping Behaviour in a Unique Retail Setting—The Indian Context”, Indian Retail Re-
view; Vol. 1, Issue 2, Jul–Dec. Reproduced with permission.
Introduction
Various communication vehicles, including displays, packaging, sales pro-
motions, in-store advertising and sales people can be used at the point of
purchase (POP) to influence the customer's buying decision (Quelch and
Cannon-Bonventre, 1983). POP display is the process of supporting in-store
brands and gives communication power at a time when traditional above-the-
line mediums are declining. It is communication without language, crossing
international boundaries in a way that other marketing campaigns cannot
(Kessler, 2004). This study defines customers as brand-buyers and price-buy-
ers with different repurchase behaviours. Essentially, a company should keep
in mind their target segment and the segment being affected while allocating
money to advertising and promotional expenditure (Brown, 1974). This study
contends that recognition of situational variables can enhance the ability to
understand consumer behaviour. The findings show how different situational
variables and their inventories affect consumer behaviour for different prod-
uct categories (Belk, 1975). A human model in a point-of-purchase display
may increase a product's appeal. This is true for both high involvement and
low involvement products. No conclusion can be drawn on what gender is
preferable (Caballero and Solomon, 1984). Unplanned purchases are higher
in some cultures as opposed to some others, but the importance of in-store
stimuli holds true across cultures (Abratt and Goodey, 1990). In-store displays
and feature advertisements serve to reduce the impact of price in the purchase
decision. They also serve to move the aggregate competitive structure away
from a product orientation, to one based more on brand names (Allenby and
Ginter, 1995). The display of unit prices on retail shelves could have significant
importance as a point-of-purchase material. Increasing the prominence of unit
price information affects the consumer's shopping behaviour by shifting pur-
chases towards lower unit priced items (Miyazaki, Sprott and Manning, 2000).
The attractiveness of the POP display to the customers is primarily dependent
on mystery (the degree to which the display contains hidden information so
that one is drawn to it to find that information), and on clarity, a combination
of coherence and legibility ( Jannson, Bointon and Marlow, 2002).
A kirana store, considered to be only a point-of-purchase earlier, has a
strong communication potential. The observation units have high interaction
with the retail outlet, which gives them an opportunity to touch and feel the
brand (Kumar, Sinha and Krishna, 2003). The findings of research in Australia,
America and India suggest that country of origin effect at the point-of-purchase
is somewhat less important to consumers than has been depicted in much of the
research conducted over the last half century (Evans, 2004). There are notable
differences in decision making behaviour across consumer literacy levels, espe-
cially with consumers' ability to evaluate information in print ads and product
packaging. The presence of a visual decision aid at the point of purchase can
improve choice for low-literacy consumers ( Jae and Delvecchio, 2004). A study
differentiates between impulse goods and impulse purchases. Based on research
done in a supermarket, the findings were that different products had different
Research Dimensions on Point of Purchase 479
degrees of impulse buying and were dependent on factors like age, sex, and race
to a varying extent (Bellenger, Robertson and Hirschman, 1978). Impulse buying
occurs when a consumer experiences a sudden, often powerful and persistent
urge to buy something immediately. Impulse buying is prone to occur with di-
minished regard for consequences (Rook, 1987). There are four types of impulse
buying. Pure impulse is novelty or escape buying. Suggestion impulse involves
buying an item by a shopper, who has never seen the offering before. Reminder
impulse deals with the recall of an out-of-stock item or the recall of an advertise-
ment concerning the item before it is bought on impulse. Planned impulse deals
with the shopper's expectation and intention of buying some items on price dis-
count (Loudon and Bitta, 1988). There are four styles of impulse shopping—ac-
celerator impulse (stockpiling to fulfil perceived future needs), compensatory
impulse (a reward for fulfilling an onerous task), break-through impulse (plays
a self-redefining role), and blind impulse (a sense of being overwhelmed by the
product) (Bayley and Nancarrow, 1998). Experiments reveal that situational vari-
ables (time and money available) as well as individual variables (shopping en-
joyment) influence the decision whether or not to purchase impulsively (Beatty
and Ferrel, 1998). Impulse buying is not always viewed negatively by consumers,
but represents a rational alternative to more time-consuming search behaviours.
Consumers buy products for a variety of non-economic reasons, explaining the
above phenomenon (Hausman, 2000). People with high levels of control (low im-
pulsivity) were the ones who were most likely to respond to sales and bargains,
in other words, to reduction in prices (Youn and Faber, 2000). The experimental
study conducted indicated that impulse buying seems to have a product-specific
nature, especially with regard to the involvement in the purchase decision ( Jones,
Reynolds, Weun and Beatty, 2003). There are wide differences among product
groups in the immediate increases in unit sales of the displayed products. On
the contrary, however, products that belong to the same product category in-
crease their sales by similar percentages (Chevalier, 1975). The effect of point-of-
purchase material on elderly shoppers was tested and the conclusion drawn was
that for an age-neutral product, elderly shoppers are indifferent to POP material,
but rely on in-store information sources (Greco and Swayne, 1992). In-store sign-
age with price is effective only when there is a discount; however, there is an
indication of what kind of signage to put up at what time (McKinnon, Kelly and
Robison, 2001). Wood (2005), distinguishes between “discretionary unplanned
buying” and impulse buying and argues that consumers buy goods and services
with discretionary income intentionally, but without prior planning. It is sug-
gested by the author that such purchases account for a significant portion of the
excitement and hedonic pleasures that customers receive from their purchases.
Objectives
To explore the effectiveness of point-of-purchase display material on the rele-
vant dimensions that will differentiate between its usage in a supermarket and
a kirana store, with respect to
1. awareness of product benefits

2. awareness of sales promotion
3. impact of the reminder of the brand mentioned in the POP
4. impact on the purchase of the brand mentioned in the POP
5. impact of POP on the impulsive purchase of the brand mentioned in the
POP
Reasons for Choosing the Study

India is a fast-growing retail market, with estimates stating that the market
for consumer goods could reach US $400 billion by 2010 and that there are
almost 11 million retail outlets in the country today.1 Further, 70 percent of
the any purchases the world over are made at the point of purchase, or in
the store, which makes the study of point-of-purchase displays and advertis-
ing extremely important. While there is literature on the stated importance of
point-of-purchase displays on the impulse purchases, and the possible influ-
ence also on planned purchases, there is no literature on what POP material
would be effective for an impulse purchase, and what for a planned purchase.
In most of these articles, a Western-style retail outlet is assumed, of the scale
of FabMall or FoodWorld. However, most of the retailing in India, even in
urban areas, is done through the kirana stores, where the reactions to point-of-
purchase material can be significantly different. Literature does not compare
the effectiveness of point-of-purchase displays on different kinds of purchas-
ing and on different retail formats.
Methodology
Two groups of respondents were considered to explore the dimensions identi-
fied with respect to point of purchase. One group of respondents was shoppers
at a supermarket and the other group shoppers at a kirana store. Around 97
percent of the sales in the Indian context take place through urorganized re-
tailing like the kirana store. (Images KSA Technopak, India Retail Report, 2005).
The profile of the respondents in Section A and Section B for both kirana
and supermarket were considered. These socio-economic classifications for
the urban area are made on the basis of education and occupation.
The Section A profile fit are
a. Shop owners/farmers/wholesalers/traders/self-employed profession-
als/junior executives/officers who have a graduate degree or above,
b. Businessmen/industrialists with less than 10 employees and have been
to college,
1
"Retail—The Next Big Thing?", The Hindu Business Line, Catalyst, October 13, 2005.
c. Businessmen/industrialists with 10 or more employees and have greater

than four years of schooling,
d. All middle/senior officers and executives who have been to college.
This section of urban population has the highest propensity to purchase
high-value consumer goods.
The Section B profile fit is
a. Shop owners/farmers/wholesale traders/self-employed professionals/
officers/junior executives who have spent some time in college but are
not graduates
b. Clerks and salesmen who are graduate and above,
c. Supervisors who are graduate and general post graduates,
d. Businessmen/industrialists with nine or less employees and have com-
pleted schooling,
e. Businessmen/industrialists with 10 or more employees, with up to nine
years of schooling,
f. All middle/senior officers and executives who have not been to college,
g. Skilled workers and petty traders with graduate or higher degree,
h. Shop owners who have completed schooling,
i. Businessmen with five to nine years of schooling, businessmen with up to
nine years of schooling,
j. Self-employed professionals, officers and junior executives who have
completed schooling,
k. Supervisors/clerks/salesmen who have spent some time in college, but
are not graduates.
Section A and Section B classification was used so that it will be appropri-
ate to both supermarkets and kirana stores as members of these groups are
customers at both the types of outlets.
Sampling
A sample size of 50 was taken for each of the chosen formats – kirana and su-
permarkets. The city of Bangalore with its geographical neighbourhood was
considered for the sampling exercise.
We looked into supermarkets like Food World and FabMall in Bangalore.
Supermarkets are large, multiple and cohesive self-service retail outlets, cater-
ing to varied customer needs. These are located in residential high streets (Im-
ages KSA Technopak, India Retail Report, 2005). Their value proposition is a
one-stop family shop in food and household categories. Their area varies from
4000–20000 sq ft. (Retailing in India: Country Report, Euromonitor, April 2004,

pp. 8–9)
A kirana store is a small grocery or general store that is found within walk-
ing distance of almost every Indian family. These stores focus on selling a large
variety of food products but also stock most home necessities. Their area is
generally upto 600 sq.ft.
Development of Hypotheses
A POP display communicates without language, crossing international
boundaries in a way that other marketing campaigns cannot. (Kessler,
2004). We formalized this and adapted it to the Indian market in the first
hypothesis.
H1: There is no difference between supermarkets and kirana stores in the
effect of POP displays on the awareness of product benefits.
Increasing the prominence of unit price information affects consumers'
shopping behaviour by shifting purchases towards lower unit-priced items.
(Miyazaki, Sprott and Manning, 2000). In-store signage with price is effective
only when there is a discount (McKinnon, Kelly and Robison, 2001).
Based on these findings and further assumptions on our part, we formalize
our second hypothesis.
effectiveness of POP materials on the awareness of sales promotions.
In-display advertising improves the image of the brand and reminds the
customers of their favorite brand everytime they enter the store ( Warner K.E.,
1986). It also encourages customers to touch, pick, and feel the product (Kes-
sler, 2004). This leads to greater brand recall. We adapt this finding and formal-
ize the third hypothesis.
impact of POP materials on the recall of the displayed brand.
Chevalier (1975), has stated that though there is a noticeable increase in sales
for high-priced items with a POP material, there is no noticeable difference in
sales for lower-priced items. Though kirana stores do not necessarily stock
low-priced items, they are meant for convenience and quick purchases. Thus,
we formalize this finding and adapt it to emerging markets in Hypothesis 4.
H4: There is no difference between the effect of POP on the purchase of the
brand in a kirana store and a supermarket.
In-store displays stimulate the desire in customers to buy the brand
(Kessler, 2004). Good displays make the brand stand out and help the cus-
tomers find their desired product. Based on this, we formalize the next
hypothesis.
impact of POP materials on the impulsive purchase of the brand mentioned in
the POP.
Analysis
The questionnaire presented to the respondents is given in Appendix 1. The anal-
ysis was performed using a one-way anova to compare the means of various vari-
ables in a kirana store and a supermarket. The results of these analyses are shown
in the tables in Appendix 2. A summary of these results are presented here.
Hypothesis 1
Variable 1, in this hypothesis, deals with the awareness about brands created
by the point-of-purchase display. As seen in Tables 1.1 and 1.2 of Appendix 2,
there is no significant difference in this variable between a kirana store and a
supermarket. Customers across both markets agree that these displays have
increased their awareness about brands.
Variable 2, in this hypothesis, refers to the awareness about the product
category created by the display. The above tables again do not indicate any
significant difference between the kirana store and the supermarket for this
variable. However, both means are around 3, indicating that most customers
are unsure about whether this awareness was created by the display or not.
Variable 3 is aimed at evaluating the range of categories in which such aware-
ness has increased. The tables indicate that there is a significant difference be-
tween the kirana store and the supermarkets in this regard, and that awareness has
increased in fewer product categories in a kirana store than in a supermarket.
Variable 4, in this hypothesis, refers to the awareness about private labels
created by the display. The above tables again do not indicate any significant
difference between the kirana store and the supermarket for this variable.
However, both means are around 3, indicating that most customers are neu-
tral about the variable.
This hypothesis indicates that awareness, in general, has increased in both
supermarkets and kirana stores. However, this increase is more pronounced
and prevalent in more categories in supermarkets than in kirana stores.
Hypothesis 2
Variable 1, in this hypothesis, deals with the awareness of sales promotions
across categories. Variable 2 refers to awareness of savings that can be made
through these sales promotions, variable 3 to the awareness of sales promotion
within a category, and variable 4 to increased expectations of sales promo-
tions. As can be seen from tables 2.1 and 2.2, none of these variables show a
significant difference between kirana stores and supermarkets. The tables also
indicate that awareness of sales promotions, in general, has increased in both
supermarkets and kirana stores as a result of point-of-purchase displays.
Hypothesis 3
Variable 1, in this hypothesis, deals with the brand recall created by the point-
of-purchase display. As seen in Tables 3.1 and 3.2 of Appendix 2, there is no
significant difference in this variable between a kirana store and a supermar-

ket. However, customers across both markets agree that these displays have
significantly increased the brand recall.
Variable 2, in this hypothesis, refers to whether the display reminds cus-
tomers of other brands in the same category. The above tables again do not
indicate any significant difference between the kirana store and the supermar-
ket for this variable. However, the verdict seems to be neutral on this aspect.
Variable 3 is aimed at evaluating whether the display reminds the customer
of those brands that offer sales promotions. Here, there is a significant differ-
ence in the respondents of kirana stores and supermarkets, with the supermar-
ket customer strongly agreeing with the hypothesis.
Variable 4 in the hypothesis asks the customer if the display reminded him
of benefits of specific brands. The above tables again do not indicate any sig-
nificant difference between the kirana store and the supermarket for this vari-
able. However, both means are around 3, indicating that most customers are
neutral about the variable.
This hypothesis indicates that brand recall, in general, has increased in both
supermarkets and kirana stores. However, this increase is more pronounced in
supermarkets than in kirana stores.
Hypothesis 4
Variable 1, in this hypothesis, deals with brand purchases created by the point-
of-purchase display. As seen in Tables 4.1 and 4.2 of Appendix 2, there is no
significant difference in this variable between a kirana store and a supermar-
ket. However, customers across both markets agree that these displays have
caused purchases to some degree.
Variable 2, in this hypothesis, refers to whether the display results in cus-
tomers buying some other brand (that is not mentioned in the POP). In this
case there is a significant difference between the customers of a supermarket
and a kirana store. Supermarket customers are much more prone to purchas-
ing other brands than kirana customers.
Variable 3 is aimed at evaluating whether the display results in purchase
of a variant of the brand mentioned or something in a related product cat-
egory. Here again, there is no significant difference in respondents of kirana
stores and supermarkets, with both sets of customers being neutral about the
variable.
Variable 4 in the hypothesis asks the customer if the display had not re-
sulted in the purchase of the category at all. The above tables do indicate a
significant difference between the kirana store and the supermarket for this
variable. Kirana store customers tend to be swayed more by the presence of
POP displays into making purchases.
This hypothesis indicates that brand purchases, in general, have increased
in both supermarkets and kirana stores. However, it cannot be concluded that
this increase is more pronounced in supermarkets than in kirana stores.
Hypothesis 5
Variable 1, in this hypothesis, deals with whether the POP display resulted in
impulsive purchase of the brand mentioned in the POP. There is a significant
difference in the respondents of supermarkets and kirana stores for this vari-
able, with supermarket customers showing a greater tendency to purchase on
impulse.
The remaining three variables in the hypothesis show no significant dif-
ference between the supermarket and kirana customers. However, customers
tend to disagree with the contention that POP displays cause impulse pur-
chases in both outlet types.
This hypothesis indicates that impulse purchases, in general, do not hap-
pen in both supermarkets and kirana stores. However, impulsive purchases
are relatively more frequent in supermarkets.
Results and Discussion

POP displays have heightened awareness and recall of the brands among con-
sumers at both the kirana store as well as the supermarket. People are attracted
by these displays because of their colours and messages. The customer, how-
ever, is not made aware of the product category, in general. In other words, he
or she may not associate a POP with a particular product category, but only to
a brand. This is reinforced by the fact that customers are not reminded of other
brands in the same category when looking at a display.
Based on our analysis, we find that in supermarkets, POP displays lead
to an awareness of brands across a greater number of categories than in a
kirana store. A possible reason for this could be the touch-and-feel factor.
Products in supermarkets, because of the store layout, are easily accessible
to the consumers. This leads to higher involvement in the category. A ki-
rana store, on the other hand, has an over-the-counter format in which cus-
tomer involvement is restricted and becomes highly dependent upon the
shopkeeper. This would also explain why supermarket customers are more
prone to buying brands other than the brand mentioned in the display than
kirana store customers, and why there is a greater tendency to buy on im-
pulse in supermarkets. POP displays do not increase the brand awareness
of private labels either in kirana stores or supermarkets. This is probably
because POP displays of these labels, if any, do not aim at increasing brand
awareness, but at sales promotions. In kirana stores, the customer's choice
is greatly influenced by the shopkeeper who also promotes his own private
product. That seems to be another reason for low effectiveness of private
labels in kirana stores.
Point-of-purchase displays have increased awareness of sales promotions
at both supermarkets and kirana stores. People have come to expect some kind
of sales promotion whenever they see a POP display, and the idea of a bargain
appeals to most shoppers. This is true across retail formats.
It can also be concluded that an attractive POP display creates a favourable

impression in the customer's mind as it results in purchase of the brand at both
kirana stores and supermarkets.
Based on the attribution theory (Schiffman and Kanuk, 2005), consumers
do not want to attribute a favourable decision that they have made on any fac-
tor other than their own judgement. This is evident from the study in which
respondents disagree with the contention that POP displays result in impul-
sive purchases.
Recommendations
a. Marketers should look positively at brand extensions (both line and cate-
gory), as awareness of product categories is not increasing as significantly
as that of brands. A similar point of purchase display could be used for
all the categories that a brand is in. However, brands that introduce a
new category (e.g. electric toothbrushes in India) may not find POP dis-
plays an effective medium for increasing awareness about the category.
b. Soaps, food and most household products are generally trial purchases
following the learn-do-feel hierarchy (Belch and Belch,2005). Purchase
of such products is influenced by displays at the point-of-purchase. For
instance, soaps as a category, are generally trial-induced purchases. Thus
the point-of-purchase displays for soaps should encourage this kind of
consumer behaviour. Bright packaging and POP displays or suggest-
ive advertising would attract customers to try the product out. Retailers
should use point-of-purchase displays that aim at increasing trial pur-
chases of private labels.
c. Marketers should place more point-of-purchase displays at kirana stores,
as customers tend to be more influenced by them at these stores because
of limited choice.
Chocolates are low-involvement products following a do-feel-learn hierarchy.

Point-of-purchase signage, both backlit and stickers, could be an innovative and
differentiable marketing tool to induce the customer to make the purchase. These
would be effective, both at the kirana and the supermarkets. The signages should
be smaller than the one outside the store with the brand name being repeated mul-
tiple number of times. This would serve to increase brand awareness. Displays
showing the chocolate being eaten, or in the process of being eaten would be more
likely to induce an impulse purchase than ones that show the chocolate closed in a
wrapper. Moving displays would also be quite effective in this context.
Implications for Practicing Managers

The study has shown that point of purchase material usage will enable su-
permarkets to have a marginal advantage over the kirana stores with respect
to enhanced awareness of brands, recall of brands offering sales promotion

and impulsive purchase of consumers. The study also reflects that consumers,
after being prompted by point of purchase (POP) material of a brand, may buy
some other brand in the same category in supermarkets. This suggests that
any brand using POP material may have to use a planned approach as other-
wise POP usage may become counterproductive, especially in a supermarket.
In kirana outlets too, planning of POP material is required as consumers ex-
posed to POP material have made more purchases.
Overall, the study has reflected that POP material does not seem to have
pronounced differences (on a variety of dimensions associated at the point of
sale) between supermarkets and kirana stores. However, the authors feel that
given the following differences between a supermarket and a kirana store, a
distinctive approach of addressing point of sale material is required, to ensure
that POP material is used advantageously in an emerging market like India:
 The differences in shelf space
 The differences in the lay-out and shopping behaviour. A kirana store is a
small shop, where consumers have to buy their purchases over the coun-
ter and will have limited visual range to look at products and brands. Su-
permarkets enable consumers to move around, touch and feel the prod-
ucts before they buy them.
 The time consumers spend in a supermarket is likely to be more than the
time they spend in a kirana store, as consumers are likely to purchase
more product categories in a supermarket than in a kirana store.
 Service in a supermarket, generally, is of a higher order with more of ser-
vice personnel at the store than a typical kirana store, where only one or
two persons attend to the diverse requirements of several consumers at
the counter.
As there is a need to apply a framework that can offer distinctive ap-
proaches to planning POP material to supermarkets as differentiated from
kirana stores, the authors propose to use the low involvement model of Krug-
man. This framework can be effectively used to apply the differences between
supermarkets and kirana stores from the viewpoint of POP material. The fact
that the study reveals no pronounced differences between the two retailing
formats in the usage of POP-related dimensions, is reflective of the potential
that POP material has to be applied to these two retailing formats.
Krugman's (Loundonn and Bitta, 1988) low involvement consists of three
stages, namely, the cognitive stage, the trial stage and the attitude stage. Cog-
nitive stage is the stage consisting of beliefs and information about brands. In a
low-involvement situation the attention levels are low, and the consumer may
not consciously process the information about the categories associated with
low involvement. In this stage it is important to distinguish between brands
that a consumer would have tried before, and a new brand. Established brands
evoke an attitude and POP material should ensure that the brand is on “top of
the consumer's mind”. Such a brand can have two kinds of POP material, one
for the supermarket and the other for the kirana shop. The kirana shop POP
can mention the brand's usual proposition but the one designed for super-
market should provide more of information on the brand as consumers move
around the store and have more time too. The brand should also train the
store personnel in supermarkets to answer queries associated with the POP
material. This will ensure that the brand not only gets noticed at the super-
market but also provides “interaction” with consumers. For example, Dove
is a moisturizer-based soap and it advertises (in TV channels) about the ad-
vantages it has over conventional soap brands. The POP of such a brand can
provide more in-depth information on how such benefits are made available
by the brand. An unknown brand that is yet to develop an attitude among its
consumers should follow a similar POP approach in a supermarket for its POP,
but given the small amount of time consumers spend in a kirana shop, it has to
have a different kind of approach for kirana shops. The POP material at such
kirana outlets should indicate further sources of information about the brand
for consumers interested in the brand. Given the power of word of mouth,
new brands can develop POP material, which creatively announces itself to
trigger word of mouth. A brand of soft drink, for example, created a fictional
character (in this case, for its re-launch) and POP material created buzz in the
respective neighborhood. The creativity employed would depend on the prod-
uct category. Buzz leads to exchange of information, that in turn can lead to
trial of the brand.
The trial phase is the second phase of the low-involvement model. An old
or a new brand can plan POP material for the cognitive phase, followed by
differentiated material to be used for supermarkets and kirana shops in the
trial phase. The demand for brand variants in terms of the offerings and also in
terms of stock keeping units is common in several categories in a market like
India. There are, for example, low-priced packs of biscuits, shampoos, fairness
creams and hair-oils, besides variants in each of these categories. POP material
for kirana shops should be specific to a market (a city or a rural area), depend-
ing on the needs of consumers in the area. The basic assumption is that once
consumers get involved with categories and brands in the cognitive phase,
they may like to try out the brand. They are more likely to try out a brand if the
POP corresponds to what they are familiar with or what they like. For example,
a major share of the market for shampoos is accounted for by sachets (small
packs of 6–10 milliliter). A POP showing a large bottle of shampoo in a rural
market (where the price of such a bottle will be beyond the affordability lev-
els of consumers) is out of place. Supermarkets, given their location in urban
markets, may be in line with POP material that showscases variety in terms of
stock keeping units or brand variants. Besides, supermarkets may have exclu-
sive sales promotion programs involving larger stock keeping units, and they
too will require exclusive POP material.
The attitude phase of the low involvement model deals with the attitude
of consumers after they have tried the brand. This is crucial as it can affect the
repeat purchase of consumers. POP material addressing this stage at super-
markets should evoke opinions and specific complaints based on the usage of
the brand. There are several brands launched in fast moving consumer goods
categories, and several brands are also re-launched in several categories. It is
highly improbable to notice any exclusive POP material, which solicits feed-
back from consumers. In supermarkets, such POP material can trigger a feed-
back mechanism by which the consumer could interact with the store person-
nel. Such an approach, itself, is likely to foster a positive consumer attitude
towards the brand. In kirana stores where consumers spend lesser time, POP
material eliciting opinion can encourage the consumer to provide an oral feed-
back to the retailer. In several markets, the retailer caters to a loyal base of
consumers in the neighborhood. These consumers may have developed a rela-
tionship with their retailer, and the POP material acts as a trigger for them to
share their complaints or feedback orally with the retailer.
Limitations of the Study

1. The study was confined to the city of Bangalore, and as such, the results
may not be the same in other markets.
2. Attribution theory effects of customers, while responding to questions on
impulse purchases, may have distorted some results.
3. A detailed analysis of what factors would constitute a “good” point-of-
purchase display was not performed. An extension of the study could be
to determine the kind of POP display that is effective at different retail
formats.
Appendix 1: Questionnaire
Please read the following statements and mark on the scale given below the question—
with 1 being that you strongly disagree with the statement, and 5 being that you
strongly agree.
Hypothesis 1
 POP displays have increased my awareness about brands.
1______________2______________3______________4______________5
 POP displays have increased my awareness about a category.
1______________2______________3______________4______________5
 Have POP displays increased awareness in many categories?
1______________2______________3______________4______________5
 Have POP displays increased awareness about private labels?
1______________2______________3______________4______________5
Hypothesis 2
 Have POP displays increased awareness of sales promotions across categories?
1______________2______________3______________4______________5
 Have POP displays increased awareness of saving across categories
through sales promotions?
1______________2______________3______________4______________5
 Have POP displays increased awareness of sales promotions within a
category?
1______________2______________3______________4______________5
 Have POP displays increased expectations on sales promotions?
1______________2______________3______________4______________5
Hypothesis 3
 Have POP displays reminded you of the brand mentioned in them?
1______________2______________3______________4______________5
 Have POP displays reminded you of other brands in the same category?
1______________2______________3______________4______________5
 Have POP displays reminded you of those brands that are offering sales
promotions?
1______________2______________3______________4______________5
 Have POP displays reminded you of the benefits of specific brands?

1______________2______________3______________4______________5
Hypothesis 4
 Have POP displays resulted in the purchase of the brand mentioned in
the POP?
1______________2______________3______________4______________5
 Have POP displays resulted in the purchase of a brand not mentioned in
the POP?
1______________2______________3______________4______________5
 Have POP displays resulted purchase of a variant of the brand mentioned
in the POP, or of a related product category of the same brand?
1______________2______________3______________4______________5
 Have POP displays not resulted in the purchase of the category associated
with the POP?
1______________2______________3______________4______________5
Hypothesis 5
 Have POP displays resulted in impulsive purchase of the brand men-
tioned in the POP?
1______________2______________3______________4______________5
 Have POP displays resulted in impulsive purchase of a brand not men-
tioned in the POP (in the same category)?
1______________2______________3______________4______________5
 Have POP displays resulted in impulse purchases not associated with any
POP in the store?
1______________2______________3______________4______________5
 Have POP displays resulted in impulse purchases of any brand on most
shopping visits?
1______________2______________3______________4______________5
Demographics
Name: _______________________________________________________________________________
Age: _________________________________________________________________________________
Gender: ______________________________________________________________________________
Income: _____________________________________________________________________________
Education:___________________________________________________________________________
Occupation: _________________________________________________________________________
Appendix 2: Analyses Results
Table1.1 ANOVA
Sum of Mean
Squares df Square F Sig.
Between
Groups 1.440 1 1.440 1.593 0.210
Within
Groups 88.600 98 .904
HYP1_1 Total 90.040 99
Between
Groups 1.960 1 1.960 1.790 0.184
Within
Groups 107.280 98 1.095
HYP1_2 Total 109.240 99
Between
Groups 10.890 1 10.890 9.714 0.002
Within
Groups 109.860 98 1.121
HYP1_3 Total 120.750 99
Between
Groups 1.000 1 1.000 0.688 0.409
Within
Groups 142.440 98 1.453
HYP1_4 Total 143.440 99
Table 1.2 Report

Retail
Outlet Type HYP1_1 HYP1_2 HYP1_3 HYP1_4
Mean 3.74 3.12 2.82 3.06
N 50 50 50 50
Kirana
Store Std. Deviation 0.986 1.043 1.004 1.268
Mean 3.98 3.40 3.48 3.26
N 50 50 50 50
Supermarket Std. Deviation 0.915 1.050 1.111 1.139
Mean 3.86 3.26 3.15 3.16
N 100 100 100 100
Total Std. Deviation 0.954 1.050 1.104 1.204
Table 2.1 ANOVA

Sum of Mean
Between Groups 0.160 1 0.160 0.180 0.672
HYP2_1 Total 87.240 99
Between Groups 0.090 1 0.090 0.115 0.735
HYP2_2 Total 76.750 99
Between Groups 0.250 1 0.250 .310 .579
HYP2_3 Total 79.310 99
Between Groups 1.690 1 1.690 1.245 .267
HYP2_4 Total 134.750 99
Table 2.2 Report

Retail
Mean 3.70 3.62 3.68 3.22
N 50 50 50 50
Std.
Kirana Store Deviation 0.886 0.878 0.868 1.093
Mean 3.78 3.68 3.58 3.48
N 50 50 50 50
Std.
Supermarket Deviation 0.996 0.891 0.928 1.233
Mean 3.74 3.65 3.63 3.35
N 100 100 100 100
Std.
Total Deviation 0.939 0.880 0.895 1.167
Table 3.1 ANOVA

Sum of Mean
Between
Groups .810 1 .810 0.880 0.350
Within
Groups 90.180 98 .920
HYP3_1 Total 90.990 99
Between
Groups 4.840 1 4.840 3.737 0.056
Within
Groups 126.920 98 1.295
HYP3_2 Total 131.760 99
Between
Groups 12.250 1 12.250 9.983 0.002
Within
Groups 120.260 98 1.227
HYP3_3 Total 132.510 99
Between
Groups 2.890 1 2.890 2.661 0.106
Within
Groups 106.420 98 1.086
HYP3_4 Total 109.310 99
Table 3.2 Report

Retail Outlet
Type HYP3_1 HYP3_2 HYP3_3 HYP3_4
Mean 4.08 3.10 2.72 3.30
N 50 50 50 50
Kirana Store Std. Deviation 0.944 1.093 1.107 0.974
Mean 3.90 3.54 3.42 2.96
N 50 50 50 50
Supermarket Std. Deviation 0.974 1.182 1.108 1.106
Mean 3.99 3.32 3.07 3.13
N 100 100 100 100
Total Std. Deviation 0.959 1.154 1.157 1.051

Table 4.1  ANOVA
Sum of Mean
Between
Groups 0.250 1 0.250 0.234 0.630
Within
Groups 104.660 98 1.068
HYP4_1 Total 104.910 99
Between
Groups 19.360 1 19.360 17.633 0.000
Within
Groups 107.600 98 1.098
HYP4_2 Total 126.960 99
Between
Groups 1.440 1 1.440 1.317 0.254
Within
Groups 107.120 98 1.093
HYP4_3 Total 108.560 99
Between
Groups 14.440 1 14.440 10.246 0.002
Within
Groups 138.120 98 1.409
HYP4_4 Total 152.560 99
Table 4.2  Report
Retail
Mean 3.58 2.08 3.00 2.50
N 50 50 50 50
Std.
Kirana Store Deviation 1.052 .900 1.030 1.165
Mean 3.48 2.96 3.24 3.26
N 50 50 50 50
Std.
Supermarket Deviation 1.015 1.177 1.061 1.209
Mean 3.53 2.52 3.12 2.88
N 100 100 100 100
Std.
Total Deviation 1.029 1.132 1.047 1.241
Table 5.1  ANOVA
Sum of Mean
Between
Groups 6.250 1 6.250 4.197 0.043
Within
Groups 145.940 98 1.489
HYP5_1 Total 152.190 99
Between
Groups 0.250 1 .250 0.207 0.650
Within
Groups 118.260 98 1.207
HYP5_2 Total 118.510 99
Between
Groups 0.360 1 .360 0.284 0.595
Within
Groups 124.280 98 1.268
HYP5_3 Total 124.640 99
Between
Groups 2.890 1 2.890 2.752 0.100
Within
Groups 102.900 98 1.050
HYP5_4 Total 105.790 99
Table 5.2  Report
Retail
Mean 3.34 2.48 2.50 3.06
N 50 50 50 50
Kirana Store Std. Deviation 1.272 1.092 1.111 1.114
Mean 3.84 2.38 2.38 2.72
N 50 50 50 50
Std.
Supermarket Deviation 1.167 1.105 1.141 .927
Mean 3.59 2.43 2.44 2.89
N 100 100 100 100
Std.
Total Deviation 1.240 1.094 1.122 1.034
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6
1
Expansion Advertising
as a Precursor to Brand
Loyalty in India*
S. Ramesh Kumar and

Aalap Sharma
Marketers have used the concept of expansion advertising to increase

the sales of a mature product in developed markets. The concept has
not been studied in terms of applicability in the developing markets.
The Indian FMCG market, in particular, offers a unique situation of
a fragmented market share and high advertising clutter. The study at-
tempted to draw a linkage between brand loyalty, expansion advertis-
ing and advertising appeals in the context of the Indian soap market.
A comprehensive literature survey was used to enable a flow of concepts.
Qualitative and quantitative techniques were used to elicit customer re-
sponses with regard to expansion advertising and its implications on brand
loyalty and specific dimensions relevant to the Indian context. The study
provides a conceptual direction, which is not common to advertising in an
emerging market like India. The conceptual frame-work is likely to be help-
ful to practitioners of advertising who contribute to brand communication
strategies. While the study is undertaken in the Indian context, it is felt that
the approach would be useful for marketing practitioners in several emerging
markets, where expansion advertising can be used by brands to enlarge their
consumer base.
Keywords: Expansion advertising, brand loyalty precursor, FMCG market, brand
* This reading was first published as Ramesh Kumar S., and Aalap Sharma (2005), “Expansion Advertis-
ing as a Precursor to Brand Loyalty in India” International Journal of Management and Entrepreneurship,
1 (1) 49–64. Reproduced with permission.
Communication Strategies, Advertising Appeals
Introduction
Expansion advertising is the kind of advertising that aims to increase the
usage of a mature product. This may be done by communicating that a certain
product is the best for a certain situation, or that it is better than an existing
product, which is used in the same situation, or that its use is as good as it is
in a different situation.
The Indian soap market is highly fragmented. The high amount of adver-
tising activity in the market only adds to the clutter. In this kind of scenario, it
is important to differentiate the kind of advertising appeals that would motiv-
ate a potential consumer towards purchase.
Brand loyalty in the Indian soap market is important for manufacturers,
considering the high frequency of purchase and the number of brands in the
market. Building brand loyalty in the market is a challenge to marketers, and
expansion advertising is likely to be useful to brand building. The Indian mar-
ket is not as mature as the Western market for fast moving consumer goods
(FMCG). This is manifested in the lower levels of customer education and a
gap in the marketers' understanding of the customers. Thus, it is important to
use qualitative research for an exploratory study so as to know the expecta-
tions and motivations of the customer that guide him/her during the pur-
chase process. The target segment chosen for the study was the consuming
class. This kind of consumer has come into the focus of marketers, and by the
end of 2006 the consuming class is expected to constitute 46.2 percent of the
total households in India. Brand communication, in the recent times, has be-
come more complex and traditional advertising may be losing its effectiveness
due to several reasons, even in a developing market. Changing lifestyles have
reduced the TV viewing time. Fragmentation of TV channels has resulted in
consumers spending less time on specific channels. The emergence of comput-
ers have also resulted in consumers (though a very small number in a devel-
oping market like India) spending less time on TV viewing. Finally, the com-
petitive communication related to brand advertising, especially in a mundane
category like soaps may have attracted less attention from consumers. There
is a need to research contemporary dimensions, which may result in better ef-
fectiveness of advertising. Expansion advertising can be used in several kinds
of contexts, with several kinds of products and target segments. It could offer
insights, if they are investigated in conjunction with behavioural aspects of the
consumer. The impact of expansion advertising on brand loyalty, with contem-
porary aspects, could provide valuable insights to enhance the effectiveness of
advertising strategies.
The study aims to integrate the concepts of expansion advertising, brand
loyalty, advertising appeals and qualitative marketing research in the context
of the Indian soap market. An attempt has been made to relate the theoretical
research on these concepts to the ground realities of the Indian FMCG market.
Expansion Advertising as a Precursor to Brand Loyalty in India 501
Review of Literature
Brand Loyalty
Brand loyalty has been an important topic of discussion in the contemporary
market scenario, where marketers are increasingly finding it difficult to re-
tain customers. Researchers have opined that brand loyalty could be driven
through functional value, symbolic value, or through price. (Kumar and Rak-
shit, 2003) The motivation to buy, coupled with one of the above three drivers
could lead to reinforcement, which could result in loyalty in purchase. Price-
led loyalty lacks commitment on the part of the consumer as they could switch
as soon as a competitor offers a better price. Brand loyalty could be considered
as the price differential needed to make consumers who prefer a specific brand
switch to some competing brand (Raju et al., 1990). This has been called the
dollar–metric measure of brand loyalty by researchers. Further, the degree of
brand loyalty is defined to be the minimum difference between the prices of
two competing brands necessary to induce the loyal consumers of one brand
to shift to another competing brand. In terms of price promotions, the likeli-
hood of using a brand increases with the number of competing brands in the
product market.
Some researchers opine that brand loyalty is slowly dying in classes where
the perceivable difference is in the price and where the consumers have
learned through deals that other differences do not matter (Rothschild, 1987).
Previously reinforced behaviours are extinguished when there is a removal of
the correlation between the response and the reward, or when the competitor
offers a new deal. Sometimes, brand loyalty can be created in the early social-
ization process itself, during childhood (Olsen, 1993). The intergenerational
transfer often represents the “bridge” of an emotional bond with the personal
relationship. Conversely, alternative behaviour or product rejection represents
a “fence”, signifying rebellion against a social relationship. When the consumer
buys a brand, he also renews the relationship he/she had with the product and
the people who introduced him/her to it. Research has distinguished between
consumers who constantly assess their buying decisions and those that have
inertia in their buying process (Venkateshwaran, 2003). Companies have to
continuously look at their value propositions, so as to make them relevant and
meaningful to this group who base their decision on objective factors. The in-
ertial group rarely assesses its purchase decisions. This could be out of a lack
of involvement or high switching costs. Companies can protect migration by
ensuring and mamtaining adequate levels of product performance, continu-
ous contact with customers, quick response to service failures and by building
in switching costs to lock in customers. There is also an opportunity to make
this group, emotional loyalists.
Researchers have identified a phenomenon called “double jeopardy” in
competitive markets by which smaller brands generally attract less loyalty
among their buyers than larger brands do. Unless other factors prevail, double
jeopardy will arise whenever competitive items differ in their popularity

(Ehrenberg et al., 1990). One dimension of research has viewed brand loyalty
as a multidimensional construct involving the emotive, the evaluative and the
behavioural tendencies towards the brand (Sheth and Whan, 1974). Depending
on the product class and upon the consumer, the dimensionality of brand loy-
alty may be as simple as any one of the above three dimensions, or as complex
as all the three dimensions. Loyalty could be looked at from a downstream per-
spective or an upstream perspective (Amine, 1998). The downstream approach
means the conceptualization of loyalty through its consequences like repeat
purchase. The upstream approach to brand loyalty is based on identifying the
motives behind true brand loyalty. The upstream approach has analyzed the
benefits of including brand commitment to understand the loyalty phenom-
enon better, and is underlined in this research. As loyalty programs are most
attractive to existing buyers of the brand and heavy buyers of the category,
they should lead to a greater effect on the average frequency of purchase, than
on the penetration. The substitution of promotions for a loyalty scheme, par-
ticularly when competitors continue with promotions, may lead to a decline
in the penetration statistic for loyalty program brands. An effective loyalty
program that has greater impact on a brand's average purchase frequency than
it has on the brand's penetration level may lead it to achieve “excess loyalty”.
(Sharp and Sharp, 1997). Loyalty should be measured on the two criteria of
attitudinal and behavioural loyalty (Day, 1969). The buyer could be thought
of as having a brand loyalty score towards a particular brand based upon the
brand's share of total purchases and the attitude towards the brand.
Expansion Advertising
Expansion advertising—promoting new uses for old brands, can increase sales
by increasing usage frequency (Wansink and Gilmore, 1999). By understand-
ing how consumers learn about new uses for mature brands, marketers can
become more effective at developing new uses and compellingly promoting
these new uses to the most promising segments. The key to effectively adver-
tising a new use for an old brand lies in making this new use appear similar
to existing uses of that brand but not in an overly manner. If the new use is
perceived as similar to the old one, the existing use for the brand provides
an “attitude halo” for the new use and eases its adoption. Substitution-in-use
research indicates that most products can be used in a wide variety of situa-
tions. However, consumers quickly become “functionally fixated” and tend
to use many products in familiar or routine ways (Wansink and Ray, 1996).
Consumers, generally, do not attempt to associate particular products with
non-routine usage situations, unless such an association is presented to them.
There is tremendous potential of advertising to increase such usage frequency.
For dominant brands, increasing usage frequency among current users may
well be more cost-effective than encouraging nonusers either to switch brands
or initiate trial. Expanding usage can also be a key strategy for small brands
that have a loyal niche following and for enhancing the penetration of a spe-
cific category. Advertisers can leverage a brand's equity, by stimulating the
frequency with which its loyal consumers consume the brand (Wansink and
Ray, 1993). One approach to stimulating such usage or consumption involves
encouraging these loyal consumers to extend their use of a product by con-
suming it in new situations, in which it is not frequently considered. Advertis-
ing that encourages this new or different use of a brand is called extension ad-
vertising. Extension advertising is defined with respect to a particular segment
of brand-loyal consumers who do not use the brand in a previously identified
situation, or who do so infrequently and only as a secondary use of the brand.
Further research shows that advertising only the functional similarities
(common attributes) between different products will be effective only if the
products are very dissimilar. The more similar two products are perceived,
the more their functional dissimilarities (distinct attributes) must be empha-
sized (Wansink, 1994). When the objective of an advertising campaign is to
increase the usage frequency of packaged good, copy-testing measures must
be sensitive to this objective. Since measuring actual usage can be prohibi-
tive in terms of time and money, according to researchers, two more primary
measures of cognitive responses and usage-intention measures could be used
because of their validity and diagnostic value. Further, it has been found that
volume estimates best approximate the actual usage of heavy users, or with
frequently consumed brands; and that likelihood estimates are more accur-
ate with light users, or with infrequently consumed brands. (Wansink and
Ray, 2001). Researchers have found that the role of usage context in customer
choice is one of constraining the problem solving process, and as a conse-
quence, one of guiding the search for and evaluation of possible solutions.
Thus, marketers can expand the usage context by guiding the customer. (War-
lop and Ratneshwar, 1993). To explore the linkages connecting values import-
ant to the consumer to the specific attributes of products, some researchers
have suggested means–end models (Gutman, 1982). The model is based on
the distinctions of customer use in grouping of objects by the virtue of their
similarity and distinguishing among them by virtue of how they vary along
common dimensions.
Research suggests that positioning a brand on versatility by communicat-
ing its suitability to a variety of end uses is likely to enhance its typicality in
the overall category. This approach, in turn, may facilitate recall and purchase
considerations in certain settings (Ratneshwar and Shocker, 1991). Research
supports the argument that explicit consideration of situational contexts may
contribute to the understanding of consumer behaviour and that a weighted
composite of situational measures may reflect general attitudes and behaviour,
especially in cases where one purchase is used in several situations (Miller
and Ginter, 1979). Five groups of situational characteristics that can affect con-
sumer behaviour have been found by researchers: physical surroundings, so-
cial surroundings, temporal perspective or any dimension of situations that
may be expressed in units, task definition that includes the intent or require-
ment to shop, select, gather information etc., and antecedent states that may
include momentary moods or conditions (Belk, 1975). One aspect of research

has suggested a person–situation model as a framework, which links personal
traits and usage situation with benefits, preferences, utilities and behaviour to
understand the target market better (Dickson, 1982).
While the literature survey brings out several important aspects of brand
loyalty and expansion advertising, the soap market (there may also be sev-
eral other similar markets in the fast moving consumer goods categories in
the Indian emerging context) in India is characterized by a high degree of
brand switching and heavy advertising with a combination of functional,
symbolic and situational appeals. A qualitative analysis of advertising ap-
peals of brands also shows that managing these appeals, over a period of
time, has not been consistent across brands. Even leading brands (in terms
of market shares) have had no consistent approach towards managing their
advertising appeals.
Besides, the brand switching by even loyal consumers of brands could be
attributed to high sales promotion offerings. While there is no study, which
delves into the importance of behavioural or attitudinal loyalty to fast mov-
ing consumer goods categories in the Indian context, the proliferation of
sales promotion strategies over a period of more than five years, indicates
the attempts by marketers in the Indian context to induce loyalty through
sales promotion schemes. Brand dilution may be one of the negative conse-
quences of such strategies, apart from reduced profitability with regard to
brands, due to failure of loyalty patterns. The soap category (though a cat-
egory with high penetration in the context) offers ample scope for the two
concepts (brand loyalty and expansion advertising) to be used in conjunction
with each other as strategy to reinforce brand loyalty. Marketers can devise
strategies for greater frequency of usage of a specific brand based on the in-
sights from the study. Brand acceptance (through specific appeals) could be
a precursor to apply “situation-based advertising” (one of the aspects of ex-
pansion advertising) leading to brand loyalty. The first critical aspect in this
context is to examine if specific advertising appeals can be used to influence
purchase decisions in the category. The second aspect is to examine if specific
advertising appeals used in a consistent manner could create and sustain loy-
alty among consumers.
Based on the literature survey and the context of the Indian soap market,
the study has attempted to explore the significance of expansion advertising
in the Indian soap market, with implications to practitioners of marketing in
the Indian context. In addition, the study explores the feasibility of using ex-
pansion advertising as a pre-cursor to brand loyalty in the Indian soap market.
Methods
An extensive literature study was done encompassing research done on
brand loyalty, expansion advertising and advertising appeals. From the lit-
erature survey, certain inferences were made as to the factors that led to
brand loyalty. Through secondary research, the appropriate factors were

mapped for the soap category. The soap category was chosen among the fast
moving consumer goods categories due to its high penetration levels (prob-
ably the only fast moving consumer good to have a penetration of more than
90 percent in the Indian market), high expenditure on advertising and high
degree of sales promotion activity in the category. If alternative ways of fo-
cused advertising strategies could be explored in the given context, it would
result in enhanced advertising effectiveness, stronger brands and stronger
brand loyalty.
Qualitative marketing research was used in the form of focus groups to
identify the motivations of the target customer segment of the consuming
class. As the middle income-level households of the consuming class were in
focus for the study, only low and mid-range priced soaps were considered.
Television advertisements were considered in the course of the study because
of the popularity of the medium with the target segment. From the focus group
discussion, certain hypotheses were formulated, which were to be tested using
a questionnaire.
The methodology was based on the following rationale:
a. The objective of the research was to highlight the importance of expan-

sion advertising to practising marketers in a chosen category.
b. There was a need to establish factors, which are important to expan-
sion advertising as perceived by the segment of consumers using soaps.
Therefore judgment sampling was used to identify the target segment
with a view to use them as focus groups. The rationale of choosing the
focus group method was to encourage the target segment to under-
stand the factors associated with expansion advertising and to explain
the objective of the study. This method was appropriate for the type of
responds selected for the study as it encouraged the respondents to pro-
vide information, which will be useful for generating hypotheses. Choos-
ing such a target segment and generating various kinds of hypotheses,
in the opinion of the researchers, were likely to appeal to practitioners in
the Indian context.
c. The factors elicited from focus groups were used in a sample, which was
selected by the judgment of researchers, based on the description of the
target segment using soaps.
d. Soap, as a product category, has a penetration of around 94 percent in
the Indian context. The authors felt that a study done with a target seg-
ment using soaps, which responded to factors associated with expansion
advertising, will evoke the interest of practitioners who will be motivated
to explore the concept further. Hence, the authors chose judgment sam-
ple. A random sample without the focus group based on judgment may
have either missed out on the consumers of soaps who are interested in
the study, or may have missed out on factors, which are associated with
expansion advertising.
e. The results of a study using judgment sample cannot be extended to

the universe. But researchers may use judgment (non probability sam-
pling) under various circumstances (Kotler, 2003). In this context of
emerging markets, the authors felt that it is appropriate to use judgment
sampling.
Reasons for Choosing Qualitative

Marketing Research
Qualitative research was chosen to enhance credibility and to accurately repre-
sent the multiple realities of the people under investigation, and this is equiva-
lent to internal validity in positional research (Hirschman, 1986). Qualitative
research is also useful because of triangulation, which involves collecting in-
formation from a diverse range of individuals and settings using a variety
of methods. These are vital for emerging markets like India (Denzin, 1970).
Researchers opine that the optimal focus group size should be less than eight
(Fern, 1983). In a subsequent research, it was opined that the presence of
other people leads to increased self-awareness that increases thought about
one's own attitudes, leading to attitude polarization (Fern and Bristol, 1993).
However, this polarization would not exist past the group discussion stage.
This polarization is heightened when the individual desires to be favorably
evaluated, the setting provides a standard of comparison or when it allows
for evaluation of others. Persuasive arguments may also modify the respond-
ent's view. Researchers have identified three different approaches that could
be taken to qualitative research: exploratory or the generation of scientific con-
structs and their validation against everyday experience, clinical or the use
of second degree scientific constructs without numerical measurement, and
phenomenological or understanding the everyday experience of the consumer
(Calder, 1977). Further, it is opined that heterogeneous groups are better for
exploratory or clinical approaches and that phenomenological approaches re-
quire homogeneity. Research has identified the qualifications and attributes
that a moderator must possess, in order to perform his job competently (Hen-
derson, 1992). The research stresses on the importance that must be given to
trained moderators as the results of the focus group hold a lot of significance
to the organization.
Focus Groups
Focus groups, apart from having lower cost also can lead to more reliable re-
sults than interviews, as a result of the interaction between the groups (Hall
and Rist, 1999). However, it is also opined that they have the relative disad-
vantage of being hinged too much on the abilities of the moderator. It could
be erroneous due to sampling errors and their results cannot be used without
empirical verification.
Focus group research can also identify areas in the customers' lives related
to a product category where the customer experiences ambivalence or conflict.
These expressions provide opportunities for producing a market – of creating
innovations that most companies today overlook. (Letelier et al., 2000).
Focus Group Discussion

The respondents of the focus group (six in number) had salaries that ranged
from Rs 5,0001 to Rs 15,000 per month, which was within the consuming class
category in the Indian context. Most of them owned their own television. The
group was well-exposed to various kinds of advertisements and indulged in
watching TV from 1–3 hours everyday. The group consisted of members ho-
mogenous with the target customer group for the study. There was a high
awareness among the group, of the different kinds of soaps and their adver-
tisements. The group discussed the various kinds of advertising appeals that
influenced them while buying soaps. Functional appeals like freshness, good
smell and moisturizing effect came out strongly in the discussion. The group
generally seemed to choose their soap based on these properties. The same
were also specified as the reasons for buying their favorite soaps. A certain
section of the group also felt that they were affected in their purchase deci-
sions by advertisements that showed the state they aspired to be or things
they aspired to own. Certain advertisements for soaps, which promise popu-
larity or a “star-like hue” after using the soap, were discussed by the group.
A longing for a soap, which had an international appeal was also noted. Yet
others seemed to associate themselves with advertisements that showed ac-
tive people and this affected their purchase. The group also discussed situ-
ations, which could make them shift over to other soaps. The situations that
the group agreed to were removal of pimples, protection from UV rays and
fairness-inducing soaps. The discussions of the focus group was conducted by
one of the researchers. As the objective of the focus group was to elicit the fac-
tors associated with expansion advertising, the individual respondents were
encouraged to express their views on the various factors associated with the
concept of expansion advertising. The focus group lasted for about one hour
and notes were made during the process. The information was then used to
draw up the various hypotheses of the study.
Quantitative Research and Formulation

of Hypotheses
After focus group study, the authors verified the information obtained by
using a battery of questions translated into the local language. Judgment
1
Indian Rupees 80 is approximately equivalent to about one British pound
sampling was used to identify the respondents. Statisticians often use this
method in exploratory studies like pre-testing of questionnaires and focus
groups. The respondents belonged to the same income group and they bought
soaps within the same, specific price range (it was hoped that the judgment
would focus on a group of consumers who would have the same kind of
awareness required for the factors used in the questionnaire). The advantage
of judgment sampling is the reduced cost and time involved in acquiring the
sample.
Indian Context
“An expert” uses his/her judgment in selecting the units from the popula-
tion for study based on the population's parameters. This type of sampling
technique might be the most appropriate if the population to be studied
is difficult to locate, or if some members are thought to be better (more
knowledgeable, more willing, etc.) than others to be interviewed. Based on
the focus discussion, a set of hypothesis was framed to test using quanti-
tative research. These hypotheses were then tested out among a sample of
55 respondents. The questionnaire offers many advantages in increased ac-
curacy of reporting; in improved field efficiency; in mechanical processing;
and in reduced costs in printing, mailing, and handling. The questionnaire
was formulated using the hypotheses made after the focus groups. The
questionnaire was made such that the questions corresponded to loyalty,
functional appeals, symbolic appeals and situational context in expansion
advertising.
The following hypotheses were tested by the questionnaire:
 H1: Significance of expansion advertising in the Indian soap market

depends upon the functional benefits extolled.
depends upon the symbolic benefits extolled.
depends upon the situational context.
 H4: The strength of functional benefits is greater than the strength of sym-
bolic benefits in determining the success of expansion advertising.
 H5: Loyalty, in the Indian soap market, is related to the functional benefits
extolled in expansion advertising.
 H6: Loyalty, in the Indian soap market, is related to the symbolic benefits
extolled in expansion advertising.
 H7: Loyalty, in the Indian soap market, is related to the situational context
in expansion advertising.
Results and Discussion

The following hypotheses were tested by the study (Calculations are shown in
the Appendix):
H1: Significance of expansion advertising in the Indian soap market de-
pends upon the functional benefits extolled.
The functional benefits extolled in the questionnaire ranged from a good
smell, reduction of body odor, and recommendation from doctors among oth-
ers. A moderately high level of confidence was found for the hypothesis. Thus
the hypothesis was not rejected and the success of expansion advertising in
the Indian soap market may depend upon the functional benefits extolled.
These benefits are important, as these could be used by marketers to expand
the usage of their product.
pends upon the symbolic benefits extolled
The symbolic appeals shown ranged from making one feel like a star, and
popularity among the other sex, among others. A low level of confidence was
found for the hypothesis. Thus, the hypothesis was rejected and the success of
expansion advertising in the Indian soap market does not depend upon the
symbolic benefits extolled. The study seems to suggest that these appeals may
not be useful for expanding the usage of the product
pends upon the situational context
Among the situations listed for this hypothesis was protection from UV
rays, making one fairer and cleaning of skin pores. A high level of confidence
was found for the hypothesis. Thus, the hypothesis was not rejected and the
success of expansion advertising in the Indian soap market may depend upon
the situational context. This is important for marketers, as the study seems to
suggest that usage of situational context in advertising appeals would be very
useful in expanding the usage of the product.
H4: Strength of functional benefits is greater than the strength of sym-
bolic benefits in determining the success of expansion advertising.
This hypothesis aimed to study which kind of appeal would be more bene-
ficial in expanding the usage of the product. A very high level of confidence
was found for the hypothesis and it was not rejected, and the strength of func-
tional benefits may be greater than the strength of symbolic benefits in deter-
mining the success of expansion advertising.
H5: Loyalty, in the Indian soap market, is related to the functional ben-
efits extolled in expansion advertising
The relation of loyalty shown by the customer to the importance assigned
to functional appeals was studied in this hypothesis. A moderately high level
of confidence was found for this hypothesis. Thus, the hypothesis was not re-
jected, and loyalty in the Indian soap market may be related to the functional
benefits extolled in expansion advertising.
H6: Loyalty, in the Indian soap market, is related to the symbolic benefits
extolled in expansion advertising
The relation of loyalty shown by the customer to the importance assigned
to symbolic appeals was studied in this hypothesis. A low level of confidence
was found for this hypothesis. Thus, the hypothesis was rejected, and loyalty
in the Indian soap market is not related to the symbolic benefits extolled in ex-
pansion advertising.
H7: Loyalty, in the Indian soap market, is related to the situational con-
text in expansion advertising
The relationship of loyalty shown by the customer to the importance as-
signed to the situational context was studied in this hypothesis. A high level
of confidence was found for this hypothesis. Thus, the hypothesis was not
rejected, and loyalty in the Indian soap market may be related to situational
context in expansion advertising.
Implications for Managers

The study was aimed to explore expansion advertising as a precursor to
brand loyalty in the soap market. The market is a highly fragmented one
in India with top brands just contributing 3–4 percent of the total market
volumes (Euromonitor report, 2003). This is true for all price tiers of the
market. Expansion advertising has been traditionally used for mature prod-
ucts to increase their usage, after demand has reached a state of saturation
(Wansink and Ray, 1993). However, the situation that confronts the manager
of low to mid-range priced soaps in the Indian soap market is different. The
burgeoning consuming class offers further potential for growth to brands
in this price range. The consuming class, in turn, has a high penetration of
televisions, that is, it forms the core audience for the brand ads in terms of
volume. However, the high amount of advertising clutter in the soap market
only confuses the viewer as to the brand's core proposition. A clear brand
proposition needs to be communicated to the potential customer for him to
make an informed choice and not to merely buy according to habit. Expan-
sion advertising stresses on increasing usage of a brand through product
comparison, situation comparison and non-comparison routes. For expan-
sion advertising to succeed, the marketer must know what kind of appeals
the customer corresponds to, what kind of appeals would make him/her
switch preferences, and what kind of appeals would make him remain loyal
to the brand.
The study has attempted to explore the advertising appeals that could be
used for expansion advertising. Advertising appeals have been split up into
three types: functional, symbolic and situational. Functional appeals have
been found to bear a moderately strong relationship to the success of expan-
sion advertising. Respondents have been found to attach a significant import-
ance to functional appeals like a good smell, reduction of body odor, mois-
turizing properties etc., in making a purchase decision. It is expected that a
brand extolling such a functional advertising appeal may be able to woo the
customer.
A functional appeal may be used both in the product comparison as well
as the non-comparison route. Through the non-comparison route of expan-
sion advertising, the brand may be communicated as the best for a specific
function. Through the product comparison route, the brand can be commu-
nicated as performing a function better than a brand that currently occupies
that mind space. For example, “Reduced body odor 50 percent times longer
than brand X”. Further, when the use of functional appeals was extended to
brand loyalty, it was found that, they have a moderately strong association
with the latter. Consumers are quite likely to be loyal to a brand if it ad-
vertises the kind of functional appeals that they want. Thus, to prevent the
outflow of customers, it is important that the brand continuously stresses
on the consumers' desired functional appeals in its communication. Sym-
bolic appeals have been found to bear a weaker correlation to expansion
advertising. Though these kinds of appeals may be useful in building brand
image and associations, it may not be a major point of consideration for
many people in guiding their purchase decisions. When these appeals were
extended and tested for the existence of brand loyalty, they were found to
have an even lower significance. Thus symbolic appeals are not expected to
be useful in building brand loyalty through expansion advertising. The situ-
ational context has been found to have a strong correlation to brand loyalty.
This is consistent with the thought that consumers need to be guided in the
usage context by marketers (Warlop and Ratneshwar, 1993). The study has
explored various situations like protection from UV rays, increasing fair-
ness, usage after sports etc. and tested the response on their importance in
the advertising, in terms of making a purchase decision. The situational con-
text can be used in the comparison route of expansion advertising wherein
an existing brand is expanded as being useful in another situation. In par-
ticular, this is important for managers as it accentuates the need for creating
situations in which the respondent would find it useful to purchase the
brand. When situational context was extended to the existence of loyalty, it
was found to have a strong correlation. This proves that consumers are loyal
if the communication of the brand accentuates its applicability in a desired
situation. Overall, the study finds that brand loyalty can be built up through
the expansion advertising route, by making use of functional appeals as
well as the situational context in advertising.
The study can be extended to different categories of FMCG. Given the state
of the Indian FMCG industry, it would be useful for brand managers to ex-
plore further uses of expansion advertising to retain, regain and gain market
share. Further empirical research may also be done to probe whether any kind
of expansion advertising has been efficiently used to improve a brand's stand-
ing in the Indian scenario.
A Framework Involving Expansion

Advertising and Loyalty
The framework given below (Figure 6.1) proposes marketing strategies, which
could be useful when expansion advertising and brand loyalty are involved.
The framework also includes marketing mix elements that could be used to
support expansion advertising for fast moving consumer goods (though the
study has covered only the category of soaps, we opine that the framework is
likely to provide marketers with useful suggestions in any fast moving con-
sumer goods category, in which expansion advertising could be used to fur-
ther brand loyalty).
One dimension is the expansion advertising that is being attempted by
a brand (which could relate to any aspect of expansion advertising) and the
other dimension is the brand loyalty associated with the brand. “Low” and
“High” in both the dimensions are to be determined by the brand, considering
a variety of factors like the intensity of advertising by competitive brands with
regard to expansion advertising, average brand loyalty in the specific category,
and the frequency with which such advertising is being used in a given period
of time for the brands in the category. Nurture strategy is appropriate when
the brand follows a high expansion advertising strategy and the loyalty to the
brand is also high. The brand will have to continue the expansion advertis-
ing and also concentrate on expanding the consumer base (it is reasonable to
assume that the high loyalty produced by the expansion advertising of the
brand would continue to have a positive impact on prospective consumers)
Brand loyalty
Low High
High Question Nurture
Expansion
advertising Low Attempt Question
Figure 6.1  Brand Loyalty and Expansion Advertisement

by investigating the need for probably more distribution outlets where the
brand may not be available, or where the frequency of availability of the brand
is not adequate. This may be probable in an emerging market like India where
there is a huge unorganized sector (unbranded offerings with low price, and
low and inconsistent quality). There may be a cross section of consumers who
may want to upgrade to branded offerings (either use them frequently or oc-
casionally), and the existing distribution may not be adequate to cover this
segment of consumers.
The brand could also use occasion-based expansion to appeal to these con-
sumers who may want to upgrade. Dettol floor-cleaning liquid is currently
attempting this strategy to appeal to consumers who would be interested in
upgrading to a higher quality branded offering of floor cleaner from the cur-
rent unbranded offering. Consumers who are using toothpowder may be in-
terested in trying out a toothpaste brand, and this may require the brand to
plan a different communication campaign altogether.
Question strategy points out to the fact that despite any form of expansion
advertising the brand is not gaining loyalty, and hence there may be other
brand strategies, which may be useful in the situation. The strategy may also
point out the need for a different approach towards marketing communica-
tion associated with the brand. For example, in the category of soft drinks
brand loyalty may not be very strong given the communication clutter with
celebrities, and below-the-line promotional activities. A brand may have to
build a personality rather than use expansion advertising to sustain its loy-
alty. Further, there may be a need for product variants or updated benefits,
which consumers expect from the brand. This may be applicable, especially
for brands which may be “pioneers” in a category – those that have intro-
duced benefits, which may have opened up a sub-category in the category.
Close-up, in the toothpaste category, and Liril, in the soap category, are ex-
amples of such brands in the Indian context. Close-up pioneered the gel
sub-category in toothpastes and Liril, the lime based sub-category in soaps.
While the aforesaid explanation holds for high expansion advertising and
low loyalty, high brand loyalty with low expansion advertising may reflect
product-based strategies like variants and updated benefits that are associ-
ated with intrinsic aspects of the brand. For example, a consumer may be
loyal to a brand of soap because of the actual experience of using the brand,
rather than because of the benefits being magnified through advertising. In
such cases experiential advertising, rather than specific expansion advertis-
ing will be more relevant.
Attempt strategy could be tried out for brands, which are low on expansion
advertising and low on brand loyalty too. These strategies can try out expan-
sion advertising and observe if such an approach increases the brand loyalty.
If such a strategy does not provide any improvement over brand loyalty, the
brand may have to re-examine its marketing mix elements, as appropriate to
its market segment.
Appendix: Calculation of the

Hypothesis Testing
1. H0 = Success of expansion advertising in the Indian soap market de-
pends upon the functional benefits extolled
z = (x − po)/o = (3 – 3.1796) / 0.71778 = – 0.2502 Using a one-tailed test,
confidence level = 59.87%
Thus, the null hypothesis is not rejected for a moderately high confidence
level
pends upon the symbolic benefits extolled
z = (x – u0) / a = (3 – 2.5522) / 0.69730 = 0.6422 Using a one tailed test, con-
fidence level = 26.11%
Thus, the null hypothesis is rejected.
pends upon the situational context
z = (x − u0) / a = (3 – 3.8148) / 1.16674 = – 0.6984
Using a one-tailed test, confidence level = 75.80%
Thus, the null hypothesis is not rejected for a high confidence level.
4. H0 = Strength of functional benefits is greater than the strength
of symbolic benefits in determining the success of expansion
advertising
z = [(x, – x2) − (u, – p2)] / 0,.2 = (3.1796 – 2.5522) / 0.1349 = 4.65
Using a two-tailed test, confidence level = 99.99%
Thus, the null hypothesis is not rejected for a very high confidence level.
5. H0 = Loyalty in the Indian soap market is related to the functional
benefits extolled in expansion advertising
z = (x − p0) / 0 = (3 – 3.1751) / 0.70807 = – 0.533 Using a one tailed test,
confidence level = 59.80%
Thus, the null hypothesis is not rejected for a moderately high confidence
level.
6. H0 = Loyalty in the Indian soap market is related to the symbolic
benefits extolled in expansion advertising
z = (x − u0) / a = (3 – 2.5077) / 0.69096 – 0.7125. Using a one-tailed test,
confidence level = 21.25% Thus the null hypothesis is rejected.
7. H0 = Loyalty in the Indian soap market is related to the situational
context in expansion advertising
z = (x − u0) / o = (3 – 3.7907) / 1.22587 = – 0.645. Using a one-tailed test,
confidence level = 74%
Thus the null hypothesis is not rejected for a high confidence level.
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CASES
While the earlier parts of the book deal with concepts and their application to research is-
sues in a specific context, the case studies provided in this part encourages readers to apply
the concepts to a distinctive framework (such as an industry-based situation with empir-
ical data from the Indian context) from the marketer's viewpoint of choosing a branding
strategy using consumer behaviour. This practice-oriented approach is reflected in three
case studies associated with branding imagery, brand positioning of services/strategic se-
lection of target segments from the brand loyalty perspective, and experiential marketing.
It may be emphasized that experiential marketing, in today's context, is considered to be
an important tool for brand building and the case study links the concept with important
patterns of consumer behaviour, providing a contemporary dimension to the application of
experiential/sensory branding.
1
Fiery Thrills or Windy Rides:

Positioning a New Brand of
Motorcycle in the Indian context
(An Emerging Market)*
S. Ramesh Kumar and
M. Geetha
Concepts associated with the case: Perception, brand imagery and associa-
tions, brand positioning strategy.
Introduction
Rajesh who has just turned 50, saw the several brands of motorcycles parked
at the theatre complex. They ranged from the rugged models that were about
ten years old to the dazzling ones that could set the heart pounding among the
yuppies. Rajesh wondered if all these motorcycles were being used fully for
their functionality (as a means of personal transport) or if there were symbolic
reasons for the purchase of these motorcycles. These thoughts brought back to
him nostalgic memories of how the Yezdis and Jawas of the yesteryears were
always considered as the “in thing” during his college days. The thoughts,
of course triggered memories of the film Andaz of the early seventies, which
dramatized romance with its symbolic motorcycle association (through its
ever popular “Zindagi Ek Safar…” song that can be heard even today in sev-
eral radio stations targeting youth). The film, launched all over the country,
* This case was written by Ramesh Kumar S., and Geeta, M., Doctoral candidate, Department of Manage-
ment Studies, Indian Institute of Technology Madras, Chennai.
The case has been written from secondary data available in public domain and its academic interpret-
ation by the authors. The survey was sponsored by Indian Institute of Management, Bangalore, India. The
case does not illustrate right or wrong handling with regard to any brand. It is purely written for academic
purposes. The incorporated survey does not have a focus towards any brand’s strategies.
reinforced the fact that films, as a medium, are instrumental in dishing out
products that may have a special significance in the psyche of consumers – a
reality that is true to this day.
Rajesh was brought back to the realities of his current challenges when he
noticed Kiran coming over to meet up with him. Rajesh, after his basic de-
gree, had worked in the motorcycle industry for more than two decades. He
had spent his last eight years in sales and marketing job profiles. His commit-
ment and passion to his work enabled him to rise up to positions that involved
branding and product management challenges that are normally the preserve
of management graduates. His current and busy consultancy work with re-
gard to marketing of durable product categories showcased his penchant for
achieving success in a crowded market place. One of his present assignments
involved probably the greatest challenge he had faced in his career: working in
the motorcycle industry to launch a new brand. Kiran was the product man-
ager of a new company and he had about six years of experience in both fast
moving consumer goods (FMCG) and durable product categories. Kiran's edu-
cational background in management, his conceptual and analytical abilities
and his thirst to succeed by fighting against the odds were primarily the rea-
sons for Windy Bikes Company to recruit him a few months back. The hardcore
practical insights of Rajesh and the marketing intellect of Kiran were probably
the prerequisite combination required to succeed in a market, which had sev-
eral complexities and nuances reflecting the developing nature of the Indian
market. They had to meet up with the Chief Executive Officer of Windy Bikes
in about two weeks' time to finalize the positioning strategy for their brand.
“Could we go to Breezy Day, the ideal place for people like us to spend
hours to brainstorm business problems and issues?” asked Rajesh. Breezy Day
was like Coffee Day, a place for people belonging to a specific strata of the so-
ciety to meet up. However, unlike Coffee Day, Breezy Day was positioned to-
wards young executives who could become annual members and spend time
in the ambience of natural greenery stocked with books, PCs, internet facilities
and reports and journals across functional areas.
Rajesh was aware of the challenges ahead. His immediate task was to de-
cide on the launch of a new bike.
The Indian market is one of the emerging economies, and it has a unique set
of challenges that are significantly different from developed markets. Brand-
ing is one of the areas where a conceptual application with regard to the Indian
context is required. This case study analyzes the market of motorcycles from
the view point of brand positioning strategies. The clutter of marketing com-
munication in this category makes it an ideal choice for the setting of such an
exercise in brand positioning. The case study portrays both the urban and the
rural market for the product, and introduces the lifestyle aspects associated
with the category as a whole, and the consumer in particular. It discusses vari-
ous brands from the viewpoint of their functional and symbolic appeals. A dis-
tinguishing feature of the Indian market in this category is the segmentation
based on price points. Price points, brand associations, brand differentiation
Fiery Thrills or Windy Rides 521
and positioning strategies of brands make the case an ideal one to apply the
principles of brand positioning and perception.
Motorcycle Industry: An Overview

The Indian motorcycle industry has been gaining momentum in the last two
decades. Changing lifestyles, commuting to work, fun and leisure and the
emergence of upwardly mobile youngsters who like to associate themselves
with motorcycle brands to reflect their lifestyles in urban markets are some
of the reasons for the increasing demand for this type of two-wheelers.*
The rural market too, has a traditional orientation towards two-wheelers
not only as a mode of personal transport but also as a mode of transport
for a small family. Besides, it also serves as a means to transport goods for
the small vendor and shows promising signs of growth potential. Going
by the behaviour of rural consumers in several conspicuous categories, the
youngsters in these markets are likely to have their counterparts in urban
markets as role models in the two-wheeler category. The expected rise in
household income, easy availability of consumer finance, growing replace-
ment demand, frequent introduction of newer trendy models by players
and the growing aggressiveness by key players are the factors aiding the
growth of the two-wheeler market. This will drive the overall two-wheeler
sales growth by around 12.7 percent to 11.9 million units by 2009–'10. Tables
1–7 provide an overview about the various aspects of the motorcycle market
in India.
Growth of Motorcycle segments

in the Indian context
Motorcycle production started in 1952 with Royal Enfield as the only producer
till the early sixties, with the production of 2,500 units per annum. The growth
in production increased to 39,000 between 1963 and 1971 with Ideal Java and
Escorts entering the field.
1972–'79 was a period of slow down for motorcycle segment due to lower
fuel efficiency and lack of design improvement. 1980–'86 was a period of for-
eign collaboration and broad banding of capacity, as a result of which the de-
mand grew by 47 percent by 1987, but the momentum could not be sustained
after 1989, when the prices of all the motorcycles were hiked and there was an
economic slowdown. The period between 1994–2002 saw the consumer pref-
erence shifted towards motorcycles in the whole of the two-wheeler market.
After registering a remarkable growth of 15.1 percent (CAGR) between 2000–'01
and 2004–'05 (see Figure 1.1), the motorcycle segment is expected to expand at
* Manohar Lazarus, “To cut clutter, personify How these brands did it”, The Hindu Business-
line, 14 Sept.,2006
Table 1  Two-wheelers: Sales trend
Year No of Units
99–00 3,468,991
00–01 3,574,356
01–02 4,306,057
02–03 5,054,142
03–04 5,629,663
04–05 6,575,584
Table 2  Two-wheelers: Brand-wise volume sales

(nos) 1999–2000 2000–'01 2001–'02 2002–'03 2003–'04 2004–'05
Hero Honda 761,700 1,029,591 1,425,302 1,677,562 2,072,903 2,621,400
Bajaj Auto 971,394 888,728 1,198,227 1,251,855 1,288,910 1,602,565
TVS Motor 780,366 863,442 865,681 1,119,309 1,146,696 1,167,515
Honda — — 55,590 167,033 341,450 551,847

Motorcycle &
Scooters
Yamaha
Motors 251,937 171,307 231,387 302,718 264,673 252,196
Kinetic Motor 120,232 127,663 126,687 133,519 126,435 107,814
Kinetic
Engineering 162,507 152,465 123,729 101,039 81,594 73,536
Royal Enfield
Motors 25,504 21,928 24,623 28,294 28,361 29,576
Total 3,468,991 3,574,356 4,306,057 5,054,142 5,629,663 6,575,584
Source: SIAM
Table 3  Motorcycle demand forecast (2009–2010)
Motorcycle 2003–'04 2004–'05 2009–'10 (P) CAGR (%)
Urban 1,787,014 1,985,777 2,951,645 8.2
Rural 2,383,432 2,978,665 6,526,354 17.0
Total 4,170,446 4,964,442 9,478,000 13.8
Source: CRISINFAC
Figure 1.1 Motorcycle salestrend (1980–’81 to 2004–’05)
Table 4  Segmentation of motorcycle
Target Price
income range Fuel
groups (Rs thousand) efficiency Margins
Economy Low Up to 38 High Low
Executive Medium 38-50 High Moderate
Premium High 50-60 Moderate High
Source: CRISINFAC
a compounded rate of 13.8 percent between 2004–'05 and 2009–'10 to touch 9.5
million units by 2009–'10. The expected surge in the rural demand will play a
key role in driving the motorcycle demand.
Segmentation of motorcycle
Motorcycle is sub-divided into further three categories
1. Economy
2. Executive
3. Premium
In 2003–'04 the executive segment has grown by 17.6 percent and in 2004–'05
it has grown by 22.7 percent. Income levels, a flurry of new models/vari-
ants from Bajaj Auto (Wind 125, Caliber 115), Hero Honda (Splendor Plus,
Passion Plus), LML Freedom and the strong sales of TVS Victor (in the first
half of the year) aided demand growth. The growth momentum continued
during 2004–'05 (sales are estimated to have grown by 22.7 percent dur-
ing this period). The growth came mainly from the Splendor and Passion
variants, on account of discounts offered by Hero Honda. New introduc-
tions such as Bajaj Discover grew well, while TVS Centra ( January 2004)
and TVS Victor GLX ( June 2004) grew on a small scale. The economy seg-
ment in 2004–'05 has grown by 48 percent covering 30 percent of the total
motorcycle sales. The price sensitive economy segment caters largely to the
Sec C segment (which mainly includes small shop owners and traders, jun-
ior officers, salesmen and supervisor level officers) and low-income buyers
from rural areas, and it is highly dependent on monsoons and overall eco-
nomic performance. Factors like consistent new model launches, and the
rise in farm incomes on account of a good monsoon in 2003–'04, contributed
to the strong growth in this segment. In the past few years, the economy
segment witnessed a series of launches from Hero Honda (with Dawn and
CD-Dawn) and Bajaj Auto (with Boxer and its latest offering, CT-100). These
model launches have generated a lot of consumer interest and induced mo-
torcycle purchases, resulting in a strong sales growth in the economy seg-
ment. For instance, Hero Honda's launch of Dawn contributed to almost
70 percent of the segment growth in 2002–'03, while CD-Dawn, with its
aggressive volume growth (since it was priced lower than BAL's Boxer),
ate into the volumes of its competitors in 2003–'04. The launch of CT-100
in 2004–'05 met with instant success, while the recent launch of TVS Star
(in select cities) has received a moderate response. However, as the euphoria
over new model launches diminishes, we expect demand in this segment to
stabilise in the medium term.
Table 5  Market share of leading brands in the three segments
Economy Executive Premium

Bajaj 03–04 39 11 64
04–05 54 9 52
Hero Honda 03–04 50 63 15

04–05 38 67 21
TVS 03–04 11 21 13
04–05 8 17 7
Source: CRISINFAC
The blurring of segments—The impact

of competition
Increasing competition has narrowed down the price differential between the
economy and executive segments. While CT-100's success has proved that the
price-conscious economy segment customers are ready to pay a few thou-
sands more for better styling and mileage and hence be pulled in to the ex-
ecutive segment, aggressive pricing of the 125 cc Discover effectively reduced
the prices in Executive segment. This triggered price cuts, mainly in the form
of discounts by select players (as direct price cuts can dilute the brand value
of a model).
Bajaj is the leading brand in economy and premium segment and Hero
Honda is the leading brand in Executive segment.
Brands and their presence in the two-wheeler market
The success of the players in the two-wheeler industry depends largely on
factors such as diversified product mix, regular introduction of new models
or variants, selling and advertising budget vis-à-vis player market share, cost-
competitiveness, and access to the latest technology along with indigenous re-
search and development capability.
The performance of the top two players – Hero Honda and Bajaj Auto – has
been favorable on the majority of the above-mentioned parameters and hence,
they are expected to continue to dominate the industry in the long run.
Bajaj, Hero Honda and TVS account for more than 80 percent market share
of the total motorcycle segment.
Table 6  Brand-wise presence in two-wheeler segments
Two-wheeler players Segments MC sub-segment

Hero Honda MC Eco, Exe, Pre
Bajaj Auto MC, S Eco, Exe, Pre
TVS Motor MC, S, M Eco, Exe, Pre
Yamaha Motors MC Exe, Pre
Kinetic Group MC, S, M Eco, Exe, Pre
LML MC, S Exe, Pre
Royal Enfield Motors MC Exe, Pre
Honda Motorcycle & Scooter MC, S Pre
MC: Motorcycles; M: Mopeds; S: Scooters
Eco: Economy; Exe: Executive; Pre: Premium
Source: CRISINFAC
Table 7  Market share comparison of key players (2003–’04 and

2004–’05) in the motorcycle segment
2003–04 2004–05
Bajaj 24% 28%
Hero Honda 48% 50%
TVS 16% 13%
HMSI — 1%
Yamaha 6% 5%
Source: CRIS INFAC
Note: Tables UMO, UCPM, SUMO, SUCPM provide the indicated responses
from the respondents. Appendix 1 shows how rankings of purchase factors
have been arrived at and Appendix 2 provides the weightages that can be
given to the features of various models.
Urban Motorcycle Owners

Note: The data was collected from 200 samples of a metropolitan city. The re-
sults are summarized in the table given below. The tables are marked as UMO–Tn
(Urban motorcycle owners–Table (n = Table number)).
UMO–T1  Factors associated with purchase/Ranking intended to

purchase
1 2 3 4 5 6 7 8 9 Total
Price 45 48 39 21 15 8 7 9 8 200
Looks 46 34 23 17 13 16 33 13 5 200
Mileage 47 67 36 18 11 9 8 4 0 200
After sales service 5 9 19 44 36 26 18 21 22 200
Technology 17 15 26 17 33 37 37 11 7 200
Driving pleasure 19 16 14 34 26 39 23 20 9 200
Maintenance costs 12 9 31 23 28 28 32 20 17 200
Features 9 10 9 20 17 23 30 50 26 200
Fun 1 4 5 10 11 10 10 50 99 200
Any other
Options Weighted average Ranking

Price 6.71 2
Looks 6.04 3
Mileage 7.21 1
After-sales service 4.58 7
Technology 5.05 4
Driving pleasure 5.025 5
Maintenance costs 4.7 6
Features 3.685 8
Fun 2.3 9
UMO–T2  Infromation about interest patterns of respondents
Interests Yes No Yes (%) No (%)

Buy designer/branded shirts/apparel 100 100 50 50
Music 140 60 70 30
Fashion with clothes/watches etc 123 77 61.5 38.5
Read sports magazine 94 106 47 53
Current affairs/politics 92 108 46 54
Food/liquor 91 109 40.5 20.6

Parties with friends 125 75 62.5 37.5
Traveling abroad 122 78 61 39
Sports/film-based celebrities 85 115 42.5 57.5
Note: The survey included owners/prospective owners of motorcycles in the urban market and included
economy, executive and premium segments. Respondents were selected in equal proportion and the re-
sponses in the table takes into consideration the responses received from each of these segments. This
means that the ranking holds good for all the three segments.
528
UMO–T3  Favorite Pastimes/Hobbies/Recreation
Pastimes/hobbies Sports Films TV Pubs Resorts Friends Books Magazines Internet
Number. of
respondents 17 10 19 1 0 5 0 0 0
Percentage 32.69 19.23 36.53 1.92 0 9.6 0 0 0

UMO–T4  Motorcycles, a frequent topic of discussion
Responses Yes No No response

Number of respondents 120 75 5
Percentage 60 37.5 2.5
UMO–T5  Motorcycles and Image Association

Percentage 70 30 0
UMO–T6  Technology Awareness

Percentage 51 43 6
UMO–T7  Occupation of the respondents
Occupations Number of respondents Percentage

Student 61 30.5
Executive 87 43.5
Government employed 14 7
Professional (doctor/
engineer/CA etc) 35 17.5
Others 3 1.5
UMO–T8  Age distribution of the respondents
Age Number of respondents Percentage

18–25 95 47.5
26–45 90 45
46 years and above 15 7.5
Prospective Urban Consumers for

the Purchase of Motorcycle
Note: The data was collected from 116 samples of a metropolitan city. The
results are summarized in the tables marked as UCPM–Tn (Urban prospective
consumers for motorcycle–Table (n = Table number))
UCPM– T1  Factors associated with purchase/Ranking intended to

purchase
1 2 3 4 5 6 7 8 9 Total
Price 27 25 27 12 5 15 2 1 2 116
Looks 23 10 16 17 12 11 17 6 4 116
Mileage 34 46 19 8 5 1 3 1 0 116
Technology 9 16 16 12 14 13 16 16 4 116
Features 6 3 7 11 18 15 25 26 5 116
Fun 2 1 3 8 3 4 8 19 68 116

Price 6.89 2
Looks 5.79 3
Mileage 7.72 1
After sales service 3.95 8
Technology 5.16 4
Features 4.09 7
Fun 2.21 9
UCPM– T2  Information about interest patterns of respondents
Interested in Yes No Yes (%) No (%)

Buy designer/branded shirts/apparel 82 34 70.7 29.3
Music 105 11 90.5 9.5
Read sports magazine 62 54 53.4 46.6
Food/liquor 52 64 45 55
Sports/film based celebrities 68 48 58.6 41.4

532
UCPM– T3  Favorite Pastimes/Hobbies/Recreation
Pastimes/Hobbies Sports Films TV Pubs Resorts Friends Books Magazines Internet

Number of respondents 39 18 21 3 1 23 9 2 0
Percentage 33.6 15.5 18.1 2.6 0.9 19.8 7.8 1.7 0

UCPM– T4  Motorcycles, a frequent topic of discussion

Percentage 42.2 34.5 23.3
UCPM– T5  Motorcycles and Image Association

Percentage 68.1 14.7 17.2
UCPM– T6  Technology Awareness
Responses Yes No To Some Extent

Percentage 52.5 40.5 7
UCPM– T7  Occupations of the respondents

Student 79 68
Executive 11 9.5
engineer/CA etc) 20 17
UCPM– T8  Age distribution of the respondents

18–25 84 72.4
26–45 28 24.1
Semi-Urban Motorcycle Owners

Note: The data was collected from 50 samples of a semi-urban area. The results
are summarized in the tables marked as SUMO–Tn (Semi-urban motorcycle
owners–Table (n = Table number))
SUMO–T1  Factors associated with purchase / Ranking intended to purchase
1 2 3 4 5 6 7 8 9 Total
Price 2 10 12 3 6 1 3 6 2 50
Looks 14 9 5 3 3 8 4 2 2 50
Mileage 21 12 5 5 2 2 0 3 0 50
Technology 4 3 3 6 9 12 5 7 1 50
Features 3 2 3 10 2 5 8 15 7 50
Fun 1 1 3 4 0 1 3 6 31 50
Any other

Price 5.14 3
Looks 6.32 2
Mileage 7.48 1
After sales service 4.56 6
Technology 4.8 5
Features 4.3 8
Fun 2.36 9
SUMO –T2  Information about interest patterns
Interests in Yes No Yes (%) No (%)

Buy designer/branded shirts/apparel 30 20 60 40
Music 40 10 80 20
Fashion with clothes/watches etc 32 18 64 36
Read sports magazine 14 36 28 72
Food/liquor 26 24 52 48
Parties with friends 40 10 80 20
Sports/film-based celebrities 29 21 58 42
Note The survey included owners and prospective owners of motorcycle in the semi-urban areas and it cov-
ers only the economy and executive segments. Respondents were selected in equal proportions in both these
segments and the response indicated in the table takes into consideration the responses from both these seg-
ments. This means the ranking indicated in the table holds good for both these segments.
SUMO –T3 Favorite Pastimes/Hobbies/Recreation

Percentage 26 30 22 4 2 10 4 0 2
Fiery Thrills or Windy Rides
535
SUMO –T4  Motorcycles, a frequent topic of discussion

Percentage 64 34 2
SUMO –T5  Motorcycles and Image Association

Percentage 78 22 0
SUMO –T6  Technology Awareness

Percentage 48 52 0
SUMO –T7  Occupations of the respondents
Occupation Number of respondents Percentage

Student 27 54
Executive 3 6
engineer/CA etc) 20 40
SUMO –T8  Age distribution of the respondents

18–25 47 94
26–45 3 6
46 years and above 0 0

Prospective Semi-Urban Consumers for the

Purchase of Motor Cycle
Note: The data was collected from 52 samples of a semi-urban area. The results
are summarized in the tables marked as SUCPM–Tn (Semi-urban prospective
consumers for motorcycle–Table (n = Table number))
SUCPM– T1  Factors associated with the purchase / Ranking intended

purchase
1 2 3 4 5 6 7 8 9 Total
Price 1 25 9 3 2 8 2 2 0 52
Looks 10 2 7 5 3 6 6 11 2 52
Mileage 37 3 3 2 7 0 0 0 0 52
After-sales service 0 2 7 15 9 0 10 0 9 52
Technology 1 14 10 3 10 7 2 5 0 52
Features 0 0 1 6 5 13 2 22 3 52
Fun 0 0 0 0 0 0 11 5 36 52

Price 6.58 2
Looks 5.17 5
Mileage 8.17 1
After-sales service 4.59 7
Technology 5.82 3
Features 3.33 8
Fun 1.52 9
SUCPM– T2  Information about interest patterns of respondents
Interests Yes No Yes (%) No (%)

Buy designer/branded shirts/apparel 17 35 32.7 67.3
Music 44 8 84.5 15.5
Read sports magazine 32 20 61.5 38.5
Current affairs/politics 24 28 46.2 53.8
Food/liquor 18 34 34.6 65.4
Traveling abroad 23 29 44.2 55.8
Sports/film-based celebrities 22 30 42.3 57.7

SUCPM– T3  Favorite Pastimes/Hobbies/Recreation

Percentage 32.69 19.23 36.53 1.92 0 9.6 0 0 0

Fiery Thrills or Windy Rides
539
SUCPM– T4  Motorcycles, a frequent topic of discussion

Percentage 52 28.8 19.2
SUCPM –T5  Motorcycle and Image Association

SUCPM –T6  Technology Awareness

SUCPM –T7  Occupations of the respondents

Student 15 28.8
Executive 24 46.2
Government employed 8 15.4
engineer/CA etc) 5 9.6
SUCPM –T8 Age distributions of the respondents

18-25 15 28.8
26-45 30 57.7
Question: How will you launch a new brand of motorcycle using the in-
formation provided in this case? Approach the new brand from the view-
point of information on segments, price points, brand positioning and im-
agery, using the principles of perception.
Appendix 1: Sample Calculation on How

Rankings were Arrived
Ranking for price
Ranks No of respondents Weights

1 45 9 405
2 48 8 384
3 39 7 273
4 21 6 126
5 15 5 75
6 8 4 32
7 7 3 21
8 9 2 18
9 8 1 8
Total 1342
Weighted 1342/200
average = 6.71
Ranking for looks

1 46 9 414
2 34 8 272
3 23 7 161
4 17 6 102
5 13 5 65
6 16 4 64
7 33 3 99
8 13 2 26
9 5 1 5
Total 1208
Weighted 1208/200
average = 6.04
Ranking for mileage

1 47 9 423
2 67 8 536
3 36 7 252
4 18 6 108
5 11 5 55
6 9 4 36
7 8 3 24
8 4 2 8
9 0 1 0
Total 1442
Weighted 1442/200
average = 7.21
Ranking for after-sales service

1 5 9 45
2 9 8 72
3 19 7 133
4 44 6 264
5 36 5 180
6 26 4 104
7 18 3 54
8 21 2 42
9 22 1 22
Total 916
Weighted average 916/200
= 4.58
Appendix 2: Weightages Given to the Features of

Various Models
Weightages given to the features of various models.
Motorcycle Price Fuel efficiency Features Trendy appeal

CD Dawn 34,835 65 1 1
CD Delux 37,890 60 1 1
Centra 38,390 53 0 1
Boss 115 38,660 62 1 1
Yamaha Crux S 39,010 91 0 2
Victor GX 39,390 68 0 2
CT 100 DX 40,180 69 0 1
Super Splendor 43,047 65 4 4
CD 100 SS 43,520 65
Victor GLX 43,850 53 2 4
Velocity 44,730 62 1 3
Gladiator 44,990 67 5 3
Shine 45,200 65 2 1
Libero G5 46,780 65 1 2
Splendor+Disc 48,001 65 2 2
Passion PlusDisc 49,592 65 5 3
Fiero F2 Disc 49,630 53 4 2
Fiero FX Disc 50,520 53 2 2
Discover(ES) 50,710 63 1 3
GF170 Disc 51,680 42 3 4
Unicorn (KS) 51,993 54 3 2
Achiever 52,646 52 3 4
Pulsar 150 (ES) 61,070 51 5 5
Pulsar 180 (ES) 65,450 42 5 5
Bullet 350 72,490 40 0 2
Karizma 76,303 34 6 6
Bullet Machismo 81,080 40 3 2
Electra 81,480 40 2 3
Bullet 500 98,000 35 2 2
Bajaj Platina 36,000 67 4 4
Note on lifestyle positioning: Most brands of premium motorcycles have a

strong lifestyle positioning. Executive segment brands and economy segment
brands, too, have several shades of lifestyle orientation in their positioning.
These aspects can be observed in some of the Web sites of the brands/respect-
ive companies. The functional features were rated based on the authors' per-
ception of the physical attributes of the respective models listed in Appendix 2.
* Most references were used for the development of teaching notes rather
than for the case study
* Instructors discussing this case may contact the author at rkumar@
iimb.ernet.in and receive the teaching note on sending the details of their
affiliation.
References
“Top throttle Positioning” Auto Times, The Times of India, May 25, 2006
Pankaj Sukhija, “Riding High on style”, The New Sunday Express, May 28, 2006.
“Yamaha Gladiator: Into The Colosseum for 125cc fight”, The Hindu Businessline, Sunday,
May28, 2006.
www.tvsmotor.in
www.bajajauto.com
www.herohonda.com
www.yamaha-motor-india.com
www.royalenfield.com
www.honda2wheelersindia.com
“Delhi Auto Expo … Bajaj Auto displays 2006 model line up”, www.indiainfoline.com/
news/news.asp?dat = 73969
“TVS Motor records 25 pc growth in motorcycles sales”, www.blonnet.com/2006/02/03/
stories/2006020301030200.htm
“Suzuki Motorcycle plans Indian launch in Oct with 125-cc bike”, www.blonnet.
com/2005/07/14/stories/2005071402530200.htm
“Mobike makers rev up launches in entry-level segment”, www.blonnet.
com/2006/06/03/stories/2006060300670500.htm
“TVS Motor aims to sell 8.5-lakh motorcycles” www.blonnet.com/2005/09/17/
stories/2005091702000200.htm
“Question 'N' Auto” www.blonnet.com/iw/2006/01/01/stories/2006010100451500.htm
Muralidhar S, “Lining up the 150cc bikes”, The Hindu Businessline, May 14, 2006
Rishad Cooper, “Platinum Edge”, The Hindu, Jun 14,2006.
“Glad to meet you”, The Hindu, 31 May,2006
www.crisil.com (CRISINFAC)
www.siamindia.com (SIAM–Society of Indian Automobile Manufacturers)
21
Call of the Mass Markets: The

Indian Cell Phone Industry*
S.Ramesh Kumar and
Radhika Vishvas
Concepts assoicated with the case: Positioning of services, perception, brand

loyalty, profitability of segments.
Conversations in the Mass Market: The Cellular Phone

Services in an Emerging Market (Indian Context)
The digital economy ushered in during the early part of the nineties has trans-
formed the life of a cross section of the population in the Indian context. West-
ern lifestyles, greater purchasing power, enhanced aspirations and greater ap-
preciation of the self-concept are some of the marked changes that have been
observed in recent times. While there have been several electronic products
that have penetrated fast in the Indian market, the exponential growth of cel-
lular phone services across the country cutting through socio-economic classes
has been amazing and unprecedented. The introduction of handsets to suit
the context by brands like Nokia at low prices, the lowest mobile tariffs in the
world, functional utility and the novelty of having this conspicuous product as
a lifestyle symbol, are some of the salient reasons that probably explain the dif-
fusion of cellular services in the country. This caselet provides the backdrop of
competition among several cellular service brands, some data about a specific
brand of mobile and an opinion survey about the usage of cellular services
among various segments of consumers conducted by the authors. The case-
let's objective is to conceptually reason out how a new brand of cellular phone
services could enter the Indian context in the scenario portrayed.
* This case was written by Ramesh Kumar S., and Radhika Vishwas, Academic Intern, Indian Institute of
Management Bangalore.
Introduction to India:
The distinguishing features of Indian economy are given below:
Economic parameters:
 India's brisk economic growth rate—the GDP grew by 6.9 percent in
2004–2005 with an average annual growth rate of 5.9 percent during the
five-year period of 2000–'05
 GDP at PPP is $ 3,319 billion when contrasted with Asia
 GDP per capita at PPP is $3,100 billion when contrasted with Asia
 India has one of the highest savings rate in the world with Rs 29 of every
Rs 100 of its national income being saved.
 Exports $63.97 billion (2003–'04)
 Imports $78.25 billion (2003–'04)
 Forex reserves $107.44 billion (2003–04)
 Inflation (percent change in WPI) at 5.5 percent.
Social Parameters:
 Fertility rate 3.1 percent
 Infant mortality rate 67 per 1000 births.
 Adult literacy rate 57 percent
 Average life expectancy of an Indian is 61years
 Dependency ratio accounting to 62 percent
 Population above 60 years is around 7.7 percent
 20 million middle class homes in rural India equal the number in urban
India and thus have the same buying power.
India is a Union of States. It is a Sovereign Socialist Democratic Repub-
lic with a parliamentary system of government. The Republic is governed
under the framework of the Constitution of India, which was adopted by the
Constituent Assembly on 26th November 1949 and came into force on 26th
January 1950. There are 28 States and 7 Union Territories in the country. The
President, through an administrator appointed by him, administers Union
Territories. From the largest to the smallest, each State/Union Territory of
India has a unique demography, history and culture, dress, festivals, and lan-
guage. India, with its total population of 1,028,610,328 (Census 2001),1 holds
a vast potential for marketers. India is undoubtedly a young country, with
a staggering 400 million youth in the age group of 0–19 (i.e 54 percent of
India's population is below 25 years and 80 percent are below the age of 45),
expecting to join the work pool in next two decades. This is a great asset for
emerging India.
Call of the Mass Markets: The Indian Cell Phone Industry 547
Liberalization of Cellular Services

With the advent of GSM in the nineties two mobile licenses were issued per
circle. The licenses were however dogged by ineffective government regula-
tions, resulting in high consumer pricing (RaboCom, 2004 (I))2. In July 1992,
the Government of India (GoI) invited private participation in providing cel-
lular mobile services (Cellular services in India conform to the digital global
system for mobile communications (GSM) standard (900 MHz spectrum)) in
the country. Initially, a duopoly model of competition was adopted for each
service area.
The award of cellular service licenses was planned in two phases through a
competitive bidding process. Cellular licenses were issued first to eight opera-
tors for the four metros – Delhi, Mumbai, Kolkata and Chennai, in the first
phase during 1994. The license for the four metros became effective from No-
vember 1994. In the second phase, cellular service licenses were to be issued
for 20 circles. The telecom circles were categorized as A, B and C, in accordance
with their status of telephony and potential (ICRA 2001)3.
After a competitive bidding process, 34 additional licenses (besides the eight
in the first round) were issued in 18 State Circles (Andaman and Nicobar is-
lands and Jammu & Kashmir did not receive any bids; West Bengal and Assam
received only one bid each). The license for most of the Circle operations came
into force from December 1995 (The licenses for cellular services are for a pe-
riod of 20 years, further extendable by 10 years at one time.)
Cellular services (cellular network local and intra-circle (within a circle)
long distance services), were introduced in India on a commercial basis in the
four metros during 1995. This was followed by the launch of services in Circles
during 1996–1998.
In addition to the existing two operators, the state-owned/controlled
operators – DoT (the GoI holds 100 percent equity stake in BSNL and 56.25
percent stake in MTNL), DTS, BSNL and Mahanagar Telephone Nigam Limited
(MTNL) reserve the right to be the third operator in each of the licensed ser-
vice areas (cellular services across the country, except in MTNL licensed areas
of Delhi and Mumbai). MTNL commenced its cellular services during FY2001,
while BSNL launched its services in FY2002.
During 2001, the GoI also invited bids for the award of licenses to the fourth
operator for cellular services in the four metros and telecom circles, besides for
the filling up of the existing slots of Andaman and Nicobar Islands and West
Bengal. In August 2001, after a “multi-stage ascending bid” process, the Gov-
ernment of India issued letters of intent (LoIs) to the successful bidding com-
panies, following their payment of the entry fees of Rs.16.34 billion. Because
of 2001 deregulation of mobile, fixed-line and long distance sectors spurred
growth and allowed many new players to enter the market.
The regulatory norms introduced by the telephone regulatory authority of
India (TRAI) had a significant impact on the long distance call charges, reduc-
ing them by as much as 80 percent in just one year. It reduced the disparity
between tariffs of wire line and wireless services from a factor of 15 to 3. How-
ever, the single most important catalyst that transformed the Indian telecom in-
dustry was the WLL controversy, which began in November, 2000 when TRAI
proposed that basic service operators (BSOs) should be allowed to use cellu-
lar technology. Mobile calling on the WLL licenses was restricted to relevant
short distance calling areas (SDCAs). However, the BSOs exploited a loop-
hole in the license and offered full mobility services by using call forwarding
and multiple number registrations. As a result, the GSM based operators who
had paid a significant license fee (2.5 billion dollars) contested this decision.
This legal battle continued for three years and was finally resolved when the
government introduced unified licensing, making cellular services technology
neutral and allowing WLL players to provide full mobility after payment of
an entry fee equal to what the GSM operators had paid (RaboCom, 2004(2))4.
Unified licensing reduced the regulatory uncertainty prevailing in the Indian
telecom industry and provided a level playing field for all the major mobile
service providers (R. C. Natarajan, 2006)5.
An Overview of Socio-Economic
Classification of India
The reality as reflected by numbers—Cellular

services industry
The following tables provide important information on the cellular phone in-
dustry.
According to Indian market demographic report 2002, NCAER, the
socio-economic classifications of India that are based on income ranges (in
INR) per annum and durable product possessions of households divide the
population into several categories of households. This basic demographic
and possession-based segmentation explains, to some extent, the lifestyle
of the respective category of households. (Refer Table A in Appendix 2)
(NCAER, 2003)6
Indian mobile services sector

The cell phone services in India have grown by leaps and bounds since the turn
of the century. Competition is fierce and companies adopt various practices to
attract consumers and retain them. Indian telecommunications industry has
entered the age of deregulated market competition from one of regulated mon-
opoly enjoyed by the department of telecommunication (DoT). In July 1992, the
Government of India (GoI) invited private participation in providing cellular
mobile services in the country. Initially, a duopoly (that is, a maximum of two
cellular mobile operators could be licensed in each telecom circle) model of
competition was adopted, under a fixed license fee regime, and for a license
period of 10 years in each service area.
The initial response of the private sector was very encouraging. The attract-
iveness of the Indian market due to its low tele-density, high latent demand
and burgeoning middle class, brought in some of the largest global telecom
players, foreign institutional investors and major Indian companies to invest
in telecom, especially in the Indian cellular industry. In 1992, India invited pri-
vate sector participation in the telecom industry. The regulatory authority was
set up in 1997 and the tariff rebalancing exercise commenced in 1999, and is
still far from complete. By March 2002, the cellular industry had 42 networks
on air, serving 1400 towns and cities; also covering thousands of villages and
serving nearly 6.5 million subscribers across the country (Contemporary con-
cerns study (2002–2004), IIMB)7.
This industry is growing at an average rate of 85 percent per annum, by pro-
viding quality service and widely accepted international standards to its sub-
scribers. In fact, as per industry data, the Indian cellular sector has registered
a compound annual growth rate (CAGR) of 109 percent in cellular subscribers
during the period 1998–2003. In the beginning of 2005, there were 48.5 million
mobile users, and just within a span of eleven months 71 million people had
subscribed to cellular services in India—including both global system mobile
(GSM) and code division multiple access (CDMA) users.
Today, there are nearly 129.5 million cellular mobile subscribers in India
and 13 percent of Indians have mobile services (Surendra T., 2007)8. It is no-
ticed that the tele-density is growing at 2.5 percent annually i.e., almost
25 million new subscribers are getting telephone connections every year, mak-
ing India, one of the most exciting telecom markets in the world (The Market-
ing White Book, 2006)9.
According to a review of tariff statistics available from the International
Telecom Union (ITU) and Electro Magnetic Compatibility (EMC), renowned
telecom consultants, the mobile telephony tariffs in India are the lowest in the
world. EMC shows that India, at $16 per month, has the lowest monthly cost
of a 300-minute basket for cellular services. In contrast, a 300-minute basket
costs $21 in China, $29 in Thailand, $40 in Malaysia and $ 42 in Indonesia. The
tariffs in South American economies are far higher at $60 for Chile, $77 for
Brazil, $96 for Mexico and $115 for Argentina (Contemporary concerns study
(2002–2004), IIMB)7.
Despite the highest regulatory costs in the world, Indian operators are of-
fering these low tariffs. Indian cellular operators are passing 35–42 percent of
their revenues to the government by way of various levies—license fees (8–12
percent), spectrum usage charges (2.5–4.4 percent), service tax (5 percent) and
interconnect access charges (approximately 20 percent of revenues) (Contem-
porary concerns study (2002–2004), IIMB)7. In contrast, cellular operators in
China pay no license fee, a negligible fixed usage charge for spectrum, no ser-
vice tax and have very reasonable terms of interconnection with the fixed ser-
vice operators.
Cellular service technologies in India

The mobile industry in India is divided between the two technologies—GSM
and CDMA. While the earlier service providers had adopted the GSM technol-
ogy, the new players have been using CDMA technology and have notched up
a significant share of the Indian market.
The cellular technologies are normally evaluated on the following three pa-
rameters, namely, the data transmission capacity, security and radiation levels
(Refer Table E in Annexure 2)10
Global system for mobile communications (GSM) is a form of multiplexing,
which divides the available bandwidth among the different channels. GSM is a
combination of time- and frequency-division multiple access (TDMA/FDMA).
The FDMA part involves the division by frequency of the (maximum) 25 MHz
bandwidth into 124 carrier frequencies spaced 200 KHz apart. Each of these
carrier frequencies is then divided in time, using a TDMA scheme. The funda-
mental unit of time in this TDMA scheme is called a burst period and it lasts
15/26 ms (or approximately 0.577 ms). Eight burst periods are grouped into a
TDMA frame (120/26 ms, or approximately 4.615 ms), which forms the basic
unit for the definition of logical channels. One physical channel is one burst
period per TDMA frame. Thus, GSM allows eight simultaneous calls on the
same radio frequency
Code division multiple access (CDMA) is a form of multiplexing (access to
the same resource will be given to more than one user), which allows the use of
a particular frequency for a number of signals, optimizing the use of available
bandwidth. It is a cellular technology that uses spread-spectrum techniques.
In CDMA technology, every channel uses the full available spectrum. Indi-
vidual conversations are encoded with a pseudo-random digital sequence.
CDMA employs analog-to-digital conversion (ADC) in combination with
spread-spectrum technology. Audio input is first digitized (ADC) into binary
elements. The frequency of the transmitted signal is then made to vary accord-
ing to a defined pattern (code), so that it can be intercepted only by a receiver
whose frequency response is programed with the same code. Hence, the re-
ceiver frequency follows along with the exact transmitter frequency. There are
trillions of possible frequency-sequencing codes; this enhances privacy and
makes cloning difficult. The technology is used in ultra-high-frequency (UHF)
cellular telephone systems in the 800 MHz and 1.9 GHz bands.
Advantages of CDMA over GSM

Since bandwidth is the major problem in the modern times, the CDMA has a
very clear advantage over the GSM in these terms:
 The number of channels (users) that can be allocated in a given band-
width is comparatively higher for CDMA than for GSM.
 In CDMA there are trillions of possible frequency-sequencing codes; this
enhances privacy and makes cloning difficult.
 Also, the cost of setting up a CDMA network is comparatively less than

that for the GSM network.
 As far as radiation level is concerned, CDMA is the most harmless among
all existing technologies. Even though it transmits microwaves while on
the standby mode, as other technologies do, CDMA technology checks
its transmission level 800 times per second. Therefore, the radiation level
in CDMA is 10 times less than that in GSM. Another important thing
to point out is that CDMA system transmits signals only when the user
starts conversation. Simply saying, when the receiver is listening to con-
versation at the other end, he/she is not affected by microwave unlike the
person speaking at the other end.
Due to these advantages there is high probability that CDMA technology
will dominate the future of mobile communications.
Common Features of Both the Technologies

Multimedia messages, video, high-speed Internet access, digital camera and
even PDA function are some of the common features that can be found in both
technologies11.
Indian Telecom—A Snapshot

Indian telecom industry is one of the fastest growing wireless markets in the
world. The compound annual growth rate (CAGR) from March 1999–2006 for
the mobile service providers is 85 percent in comparison with the CAGR for
fixed-line service providers, which is just 13 percent, indicating mobile ser-
vice overtaking the fixed-line subscriber base (Contemporary concerns study
(2002–2004), IIMB)7 in the given period. Table B in Appendix 2 gives the total
Indian telecom service providers' subscriber database of March 2006
Subscriber base—Indian telecom service providers

According to TRAI press release and AUSPI & COAI, March 31st 2006 data,
there is nearly 4.6 and 8.3 percentage of penetration per population of fixed line
and wireless subscribers respectively, with an increasing private player partici-
pation in the telecom service providers sector (refer Table B in Appendix 2)
Indian Mobile Service Providers—

A Competitive Scenario
The various major aspects of competition among the cellular service brands
that include type of technology, the circles or geographical zones involved and
market share are shown in Table C, Appendix 2.
Key Mobile Service Providers of India

Bharti Airtel
Bharti Airtel Limited is one of India's leading private sector providers of tele-
communications services with an aggregate of 39 million customers as at the
end of March'07, consisting of 37.14 million mobile customers. Bharti Airtel
has been rated among the 10 best performing companies in the world in the
BusinessWeek IT 100 list (Results presentation for the fourth quarter and full
year ended, 2006)12
Bharti Airtel is structured into three strategic business units—mobile
services, broadband and telephone (B&T) services and enterprise ser-
vices. The mobile business provides mobile and fixed wireless services
using GSM technology across 23 telecom circles. The B&T business pro-
vides broadband and telephone services in 94 cities. The enterprise ser-
vices provide end-to-end telecom solutions to corporate customers and
national and international long distance services to carriers. All these ser-
vices are provided under the Airtel brand. Airtel's high-speed optic fibre
network currently spans over 40,000 kms covering all the major cities in
the country. The company has two international landing stations in Chen-
nai that connects two submarine cable systems—i2i to Singapore and SEA-
ME-WE-4 to Europe13. The company provides reliable end-to-end data and
enterprise services to corporate customers by leveraging its nationwide
fiber optic backbone, last mile connectivity in fixed-line and mobile circles,
VSATs, ISP and international bandwidth access through the gateways and
landing stations.
Vodafone Infrastructure Sharing

MOU with Bharti
Vodafone has granted the Bharti group company an option, subject to comple-
tion of the Hutch Essar acquisition, to buy its 5.6 percent listed direct interest
in Bharti for US$1.6 billion (£0.8 billion), which compares with the acquisition
price of US$0.8 billion (£0.5 billion)14
Bharti's Unified Brand Strategy

Bharti Tele-Ventures, one of India's leading telecom conglomerates unveiled
a unified brand strategy for all telecom services, with Airtel as the flagship
brand on 15th September 2004.
Under the new brand architecture, Bharti's telecom services are being
clubbed under four heads:
 Airtel mobile services—Mobile services

 Airtel telephone and broadband services—Fixed line services and broad-
band solutions
 Airtel long distance services—Long distance service (ILD & NLD)
 Airtel enterprise services—Single window end-to-end telecom solution
for large corporations.15
Hutchison Group
Hutch is the brand name of Hutchison Essar. It established its presence in
India in 1994 and was one of the first cellular providers in the city of Mumbai.
Over time it has expanded operations across the country and is one of the most
respected cellular service providers known for providing world class and in-
novative services.
Hutch established its presence in India in 1994 by acquiring the cellular li-
cense for Mumbai. It now has operations in 16 circles (covering the respective
geographical areas) that account for 70 percent of India's mobile subscriber base.
Hutchison Essar Limited, with about 18.4 million subscribers, is one of the
most reputed telecom companies in India. Hutchison Telecom is a part of the
multinational conglomerate—Hutchison Whampoa that has its origins dating
back to 1828 in Hong Kong. The group operates five core businesses in 42 coun-
tries across the world, of which, Hutchison Telecom has been one of the pioneers
in mobile multimedia communication and spans five continents. The Essar Group
is one of India's largest corporate houses with interests spanning the manufactur-
ing and service sectors like steel, oil and gas, power, telecom and BPO, shipping
and logistics, and engineering and constructions. The group has an asset base of
over Rs 20 billion (US$ 4.4 billion) and employs over 4000 people16
Vodafone Acquiring Hutchison Essar in India

Vodafone announced on 11th February 2007 that it has agreed to acquire a con-
trolling interest in Hutchison Essar Limited (“Hutch Essar”), for an enterprise
value of US$18.8 billion (£9.6 billion) for Hutch Essar. Vodafone has agreed
to acquire companies that control a 67 percent interest in Hutch Essar from
Hutchison Telecom International Limited (“HTIL”) for a cash consideration of
US$11.1 billion (£5.7 billion) (Charles Assisi, 2007)17.
Reliance Infocom Ltd

Promoted by Reliance Industries Limited, Reliance Infocom Ltd offers mo-
bile telephony services on the CDMA platform on a nation-wide optical fiber
cable network capable of supporting broadband services. Its strategy has

been to acquire a large subscriber base backed by low tariffs, and then to
promote calls within its network to enable yet lower tariffs for its subscrib-
ers. Reliance Infocom is building a vast broadband network and Internet
protocol (IP) backbone, connecting India's top 582 cities with more than
60,000 route kilometers of fiber that will offer terabit capacity. Once this net-
work is complete, Reliance will offer customers a full range of services in-
cluding national coverage, fixed line, mobile, national long distance, and
international long distance, as well as a full offering of data, image, and
value-added services18.
Tata Teleservices Ltd

Tata Teleservices Limited (TTSL) is part of the US$17.8 billion Tata Group
that has over 90 companies, over 220,000 employees and more than
2.8 million shareholders. With a committed investment of US$ 7.5 billion in
Telecom (FY 2006), the group has a formidable presence across the telecom
value chain. Tata Teleservices spearhead the group's presence in the tele-
com sector. Incorporated in 1996, Tata Teleservices was the first to launch
CDMA mobile services in India, in the Andhra Pradesh circle. Tata, with
its acquisition of Hughes Telecom (India) Limited (now renamed Tata Tele-
services (Maharashtra) Limited) in December 2002, swung into expansion
mode. Tata Teleservices operates in 20 circles i.e., Andhra Pradesh, Chennai,
Gujarat, Karnataka, Delhi, Maharashtra, Mumbai, Tamil Nadu, Orissa,
Bihar, Rajasthan, Punjab, Haryana, Himachal Pradesh, Uttar Pradesh (E),
Uttar Pradesh (W), Kerala, Kolkata, Madhya Pradesh and West Bengal. Tata
Teleservices has established a robust and reliable telecom infrastructure
that ensures quality in its services. It has partnered with Motorola, Erics-
son, Lucent and ECI Telecom for the deployment of a reliable, technologic-
ally advanced network.
The company, which heralded convergence technologies in the Indian tele-
com sector, is today the market leader in the fixed wireless telephony market
with a total customer base of over 3.7 million. Tata Teleservices' bouquet of
telephony services includes mobile services, wireless desktop phones, public
booth telephony, and wire line services. Other services include value added
services like voice portal, roaming, post-paid Internet services, 3-way confer-
encing, group calling, Wi-Fi Internet services and data services. Tata Teleser-
vices has marked its entry into the prepaid segment by launching “True Paid”,
across all its existing 20 circles. Tata Indicom has also launched a collection
of 1000 mobile games—one of the largest collections of mobile games in the
world
Tata Indicom has redefined the existing prepaid mobile market in India
by unveiling their new offering—Tata Indicom “Non Stop Mobile” and
“Don't Stop Mobile”, which allow customers to receive and make free
incoming and outgoing calls. Introduced in India for the first time, the
new “Non Stop Mobile” and “Don't Stop Mobile” are targeted towards
the vast masses of India. Tata Teleservices has a strong workforce of 6000.
In addition, TTSL has created more than 20,000 jobs, which include 10,000
indirect jobs through outsourcing of its manpower needs. Today, Tata Tele-
services Limited, along with its subsidiary Tata Teleservices (Maharashtra)
Limited, serves 10 million customers in over 2700 towns. With an ambi-
tious rollout plan both within existing circles and across new circles, Tata
Teleservices is offering world-class technology and user-friendly services
in 20 circles19.
Bharat Sanchar Nigam Limited (BSNL)

Bharat Sanchar Nigam Ltd, formed in October, 2000, is the world's seventh
largest telecommunications company providing comprehensive range of
telecom services in India: wireline, CDMA mobile, GSM mobile, Internet,
broadband, carrier service, MPLS–VPN, VSAT, VoIP services, IN services etc.
Within a span of five years it has become one of the largest public sector units
in India.
BSNL has installed Quality Telecom Network in the country and is now
focusing on improving it, expanding the network, introducing new telecom
services with Information Communication Technology (ICT) applications in
villages, and winning the customer's confidence. It has about 47.3 million line
basic telephone capacity, 4 million WLL capacity, 20.1 million GSM capacity,
more than 37,382 fixed exchanges, 18000 BTS, 287 satellite stations, 480196 Rkm
of OFC Cable, 63,730 Rkm of microwave network connecting 602 districts, 7330
cities/towns and 550,000 villages. BSNL is the only service provider, making
focused efforts and planned initiatives to bridge the rural-urban digital divide
in the ICT sector. In fact, there is no telecom operator in the country to beat its
reach with its wide network giving services in every nook and corner of the
country and operating across India except in Delhi and Mumbai.
BSNL is the number one operator of India in all services in its license area.
The company offers wide ranging and most transparent tariff schemes de-
signed to suit every customer.
BSNL cellular service, CellOne, has more than 17.8 million cellular cus-
tomers, garnering 24 percent of all mobile users as its subscribers. This means
that almost every fourth mobile user in the country has a BSNL connection.
In basic services, BSNL is miles ahead of its rivals, with 35.1 million basic
phone subscribers i.e., 85 percent share of the subscriber base and 92 percent
share in revenue terms.
BSNL has more than 2.5 million WLL subscribers and 2.5 million Inter-
net customers who access Internet through various modes viz. Dial-up, leased
line, DIAS, and acount-less Internet (CLI). BSNL has been adjudged as the
number one ISP in the country.
BSNL has set up a world-class multi-gigabit, multi-protocol convergent

IP infrastructure that provides convergent services like voice, data and video
through the same backbone and broadband access network. At present there
are 0.6 million DataOne broadband customers. The company has vast experi-
ence in planning, installation, network integration and maintenance of switch-
ing and transmission networks, and also has a world class ISO 9000 certified
telecom training institute. Scaling new heights of success, the present turnover
of BSNL is more than US $ 8 billion with net profit to the tune of US $ 2.26 bil-
lion for last financial year. The infrastructure asset on telephone alone is worth
about US $ 14.37 billion. The turnover, nationwide coverage, reaches, compre-
hensive range of telecom services and the desire to excel has made BSNL the
No. 1 telecom company of India20.
Spice Telecom
Spice Telecom, the brand name of Spice Communications Private Limited
is presently operating cellular phone services in the states of Punjab and
Karnataka. Considered as one of the best service providers of mobile teleph-
ony in India, Spice Telecom is the flagship company of MCorp Global, a pi-
oneer in introducing cellular mobile telephone services in India and having
business interests in the fields of information, communication and entertain-
ment (ICE).
Spice is trying to enable re-engineering of its existing businesses for greater
competitiveness through building new strategic partnerships both in India and
overseas. Telekom Malaysia Berhad (TM) has 49 percent stake in Spice Com-
munications Private Limited (Spice) through TM's international investment
holding company, TM International Sdn Bhd (TMI). The remaining 51percent
is with Mcorp Global Ltd and its associates (Mcorp)21.
Implications
The following are the implications of a rapidly growing mobile industry with
brands like Airtel and Vodafone.
1. Given the large potential for mobile phones in India, brands will be
required to enlarge the base of consumers. This is evident from the
various sales promotional offers of brands at the lower end of the
market.
2. In order to compete with a major brand like Airtel, brands need to ef-
fectively market value added services like short message services (SMS)
and music downloads. Given the large youth population in the country,
acquiring and retaining consumers who use value added services will be
an important strategy for brands.
3. Brand positioning to attract the youth segment will be important to
brands.
Mapping Competition in the Mobile Phone

Market—Positioning Maps
H
Airtel
Hutch
Reliance Infocom
L H
Service
L
Price
Positioning Map1  Price Vs Service

Note: The authors have used the number and variety of services to plot the perceptual map.
The prices of services have been obtained from the retailers.
H
Hutch
Airtel
Reliance Infocom
L H
Life Style
L
Price
Positioning Map 2  Price Vs Life Style as Symbol

Note : The brands are positioned on lifestyle as symbol at the authors discretion based on
their exposure to the advertisements of brands
Data of a Cellular Service Brand–Mass Mobile*

The brand “Mass Mobile” has got a consumer base of 7,00,000 and 70,000 in
prepaid and post paid services respectively. Its main stream of total revenue
flowing from its value added services accrue to a blended (Pre-and Post-paid)
14 percent of the total revenue. This service provider is showing an increase in
consumer base by nearly 70,000 and 2,500 consumers joining in prepaid and
postpaid services respectively every month. The churn rate as well as the con-
sumer usage pattern and costs involved with regard to overheads are shown
in Table D in Appendix 2.
Percentage of customer segment associated with

Mass Mobile
After studying the four different respondent groups and interacting with the
leading brand Mass Mobile phone service provider, it is clear that 50 percent
(pre-paid + post-paid) of business class/professional class users are the major
subscriber base. This is followed by the youth/students segment, which used
nearly 30 percent services and the private employment group that makes up
13 percent users of both pre- and post-paid services. The Government employ-
ment user group is the least user with only 7 percent consumer base using both
the services (refer Table 1 in Appendix 2)
Opinion survey among cellular service users:

A questionnaire designed to elicit responses from four major segments of users
(as defined in the case) was used. The four segments consist of Private em-
ployment, Youth/Student, Businessman/Professional, and Government em-
ployment. Seventy-five respondents were randomly selected from each of the
segments and responses were obtained.
Note: Full questionnaire is provided in Appendix 1.
Results of the survey associated with

Mass Mobile
Tables 2–5 in Appendix 2 represent the results of the survey conducted on
the four groups of the consumer base—Private employment, Youth/Student,
Businessman/Professional and Government employment subscribers. The
tables provide information on several aspects of mobile services purchase and
usage.
Note: *The brand name and the figures have been changed to ensure confidentiality
Question for discussion:

1. In the event of the service category being opened up for a new brand
(either through foreign direct investment or an Indian business group at-
tempting one) how should it enter the Indian cellular service market?
2. How can the impact of brand loyalty and brand switching be explained
in such a huge base of consumers, even though the prices of mobile ser-
vices are lowest in the world?
Note: The teaching note for this case is available with the author. Instructors
discussing this case may contact him at rkumar@limb.ernet.in and receive the
note on sending the details of their affiliation.
Appendix 1: Questionnaire
Please fill up this questionnaire. This will be used only for academic purposes.
The information you provide will be kept confidential. So kindly find a few
minutes to complete this questionnaire and help us in our survey (Please mark
‘*’ in front of your correct answer, save it and send it back at the earliest)
1. Which of the following do you feel serves the best use for your mobile?
  Contacting family members
  Business purpose
  Social interaction
  Any other please specify
2. Do you feel that the services provided by different service providers, in
general, are good?
Yes No
3. Do you think maintaining a mobile is expensive?
Yes No
4. Do you perceive that you will require all services provided by mobile ser-
vice providers?
Yes No
5. Do you think there is transparency (you are able to completely under-
stand) in the services provided by the various brands of mobile service
providers?
Yes No
6. Do you feel that there should be good loyalty schemes offered by mobile
service providers (better than what they offer currently)?
Yes No
7. Do you feel that light users and heavy users are being treated alike (from
the viewpoint of pricing of services) currently?
Yes No
8. Do you think there is an unwanted hype and “noise” about various ser-
vices offered by mobile service providers?
Yes No
9. Do you understand all the value added services offered by your mobile
phone operator?
Yes No
10. Do you feel that people use mobile services as a status/fashion symbol
also?
Yes No
11. Do you use the mobile for value added services, other then using it for
communication purposes?
Yes No
12. Name :
Age:
Income range/month: 5000 – 15,000

15,000 – 25,000
25,000 – 35,000
>35,000
Sex: • Male • Female
Marital status: • Married • Bachelor

Occupation:
• Youth/Student • Employed/Professional
• Businessman • Government employee
Appendix 2: Tables Used in Mass

Mobile Case Study
Table A  An overview of socio-economic classification of India
The reality as reflected by numbers—The cellular services
industry
Class of Income range House holds Durable Product

people per annum in millions Possessions
INR /annum Urban Rural Total

Destitute <=35,000 0.84 16.34 17.18 Households owning any/
all/none of these–wrist
watches, pressure cooker,
mono cassette recorder,
transistor/radio with
durables other than those
mentioned under the next
four categories.
Aspirants 35,001–70,000 2.99 38.85 41.84 Households owning any/

all of these–bicycle, electric
fans, and electric iron with
other durables but not those
mentioned under the next
three categories.
Climbers 70,001–105,000 13.17 41.38 54.55 Households owning any/

all of these–moped, VCR/
VCP, mixer-grinder, sewing
machine, audio equipment
(2 in 1, etc), B & W
television, geyser with other
durable products but not
those mentioned under the
next two.
Well-off 105.001–140,000 29.45 27.36 56.81 Households owning

any/all of these–air
conditioners, motorcycle,
scooter, washing machine,
refrigerator, colour TV, with
other product durables but
not car/Jeep.
Affluent >140,000 4.84 1.32 6.16 Households owning

personal car/jeep with other
products.
All 51.29 125.24 176.54
Source: Indian market demographic report 2002, NCAER.

INR = Indian Rupees, INR 45 = US $1.
Table B  Subscriber base—Indian telecom service providers
Parameters Unit March 2006 Penetration/Pop

Fixed line subscribers Million 50.2 4.6 Percent
Wireless subscribers Million 89.6 8.3 Percent
Total telecom subscribers Million 139.8 -
Private players Million 79.3 -
Public players Million 60.5 -
Source: TRAI press release dated April 10, 2006 and AUSPI & COAI data as of
March 31,2006. Accessed on 22nd September 2006.
Table C  Indian mobile service providers—A competitive scenario
No. of Wireless
Services Wireless operational market share
offered Technology circles (of 23) (March–2006)
A. Private GSM
1. Bharti Integrated GSM 23 21.8 %
2. Hutch Mobile GSM 16 18.6 %
3. Idea Mobile GSM 11 8.2 %
4. Others Mobile GSM - 5.2 %
B. Private CDMA
5. Relaince Integrated CDMA, GSM 23 19.3 %
6. Tata Integrated CDMA 20 5.4 %
C. Government owned
7. BSNL + MTNL Integrated GSM, CDMA 23 21.4 %
Source : AUSPI and COAI data as of March 31, 200622

Accessed on 22nd September 2006.
Table D  Data of a cellular service brand Mass Mobile
The brand Mass Mobile and the numbers associated with it
No. of consumers Pre paid: 7,00,000

Post paid: 70,000
% Share of value added service in the Blended: 14%

total revenue per month
(Continued )
Table D (Continued )
Churn rate per month Prepaid: 3 %
Postpaid 4 %
No. of new customers joining every month Prepaid: 70,000 Gross Add
Postpaid 2,500 Gross Add
Average talk minutes per day Prepaid: 71,55,000

Postpaid 16,82,000
Avg. prices of top three value added services costs Rs 6 per min.
Total advertisement and promotional Rs 7.5 Mn

costs per month
Network maintenance cost per month Rs 55 Mn
Cost of servicing the consumer Blended Rs 9 Mn
Other expenses 78.5 Mn
Costs other than the network costs Rs 150Mn
Table E  Cellular service technologies in India

Data transmission of different technologies
Cellular technology Generation Data transmission capacity

GSM 2G 56 Kps
CDMA (IS-95B) 2.5G 64 Kps–140 Kps
CDMA 2000 3G 2 MBps
Source: www.naavi.org/cl_editorial_04/edit_dec_04_04_01.htm
Table 1  Percentage of customer segment associated with Mass Mobile
Prepaid service Postpaid service

Customer segment (in percentages) (in percentages) Total (%)
Private employment 10 3 13
Youth/Student 25 5 30
Businessman/Professional 40 10 50
Government employment 5 2 7
Source: The respective percentage has been obtained from the authors’ interaction with a
leading brand of mobile phone services.
Table 2  Results from survey: Private employment sector
Q.No Questions Private Employment

Yes (%) No (%) Total (%)
1 Which of the following do you Contacting For social 100%
feel serves the best use for family interaction
your mobile? members (15%)
(85%)
2 Do you feel that the services 75 25 100

provided by different service
providers, in general, are good?
3 Do you think maintaining 43 57 100

a mobile is expensive?
4 Do you perceive, you will 28 72 100

require services provided
by mobile service providers?
5 Do you think there is 27 73 100

transparency (you are able to
completely understand) in the
services provided by the various
brands of mobile service
providers?
6 Do you feel that there should be 83 17 100

good loyalty schemes offered by
mobile service providers (better
than what they offer currently)?
7 Do you feel that light users and 65 35 100

heavy users are being treated
alike (from the viewpoint of
pricing of services) currently?
8 Do you think there is an unwanted 70 30 100

hype and “noise” about various
services offered by mobile service
providers?
9 Do you understand all the value 42 58 100

added services offered by your
mobile phone operator?
10 Do you feel that people use mobile 50 50 100

services as a status/fashion
symbol also?
11 Do you use the mobile for value 42 58 100

added services, other than using it
for communication purposes?
Table 3  Youth/Students
Q.No Questions Youths/Students
Yes (%) No (%) Total (%)
1 Which of the following do you Contacting Social 100%

feel serves the best use for family Interaction
(70%)



5 Do you think there is transparency 22 78 100

(you are able to completely
understand) in the services
provided by the various brands
of mobile service providers?



providers?


symbol also?

added services, other than using
it for communication purposes?
Table 4  Businessman/Professionals
Q.No Questions Business/professionals
Yes (%) No (%) Total %
1 Which of the following do you Business Contacting 100%

feel serves the best use for purpos (95%) family







providers?


symbol also?

added services, other than using it for
communication purposes?
Table 5  Government Employment:
Q.No Questions Government Employment
Yes (%) No (%) Total %
1 Which of the following do you Contacting Social 100%

feel serves the best use for family Interaction
your mobile? members (45%) (55%)






8 Do you think there is an unwanted 78. 22 100

providers?


services as a status /fashion
symbol also?

added services, other than using
it for ommunication purposes?
Note: Tables from 2 to 5 give the customer responses for various aspects of mo-
bile service usage.
References
1. Indian Statistical hand book Census (2001)
2. RaboCom. 2004(1), Vol.9, Spring, p.12
3. ICRA (2001) Information services, December 2001, “The Indian Telecommunication Sec-
tor, Cellular services in India”, Sourced from Library of Indian Institute of Management,
Bangalore, E-20292.
4. RaboCom. 2004(2), Vol.9, Spring, p.13
5. R.C.Natarajan (2006) and Students group 2004–2006, “Mobile Telephony and Youth's
Perception”, TAPMI, Sourced from: IIMB Library, MD/NBM Section, E-26791Ind
6. NCAER (2003), Indian market demographics report 2002, IIMB Acc.No. 67038, 21st October.
7. Contemporary concerns study (2002–04) “Diffusion of Mobile Telephony”, PGP 2002–
2004, unpublished report sourced from library of Indian Institute of Management,
Bangalore.
8. Surendra T. (2007), “Your phone bill will pay for the acquisitions”, Times of India, 13th
February
9. The Marketing White Book (2006), Business World, Telecom, Pg.No.255
10. www.naavi.org/cl_editorial_04/edit_dec_04_04_01.htm
11. www.hardwaresecrets.com/article/151
12. “Results presentation for the fourth quarter and full year ended March 31,2006”, New
Delhi, April 28, 2006, www.bhartiairtel.in, PPT Slide No:5
13. www.bhartiairtel.in/48.html
14. www.vodafone.hu/eng/vodafone/nemz_sajtokozlemenyek/npr070211_eng.html
15. www.bhartiairtel.in/48.html, Category: FY2004–2005 15–09–04 “Bharti heralds the begin-
ning of a unified era in the Indian Telecom Industry”
16. www.hutch.in/home/index.asp
17. Charles Assisi (2007), “Why Vodafone paid $18.8bn to enter India”, Times of India 13th
February
18. www.relianceinfo.com/Infocomm/html/media/tv_commercial.html
19. www.tata.com/tata_teleservices/).
20. www.bsnl.co.in/index.html).
21. www.spiceindia.com/spice/index.asp)
22. TRAI (Telephone Regulatory Authority of India) press release dated April 10, 2006,
AUSPI(Association of Unified Telecom Service Providers of India) and COAI (Cel-
lular Operators Association of India) data as of March 31,2006
3
The Importance of Experiential

Marketing in Marketing
Communications*
S. Ramesh Kumar and Kavitha Murali
Concepts associated with the case: Experiential marketing, attitudinal com-

ponents, brand imagery, brand associations, brand personality.
Introduction
This case illustrates the importance of experiential marketing in the Indian
context, which is cluttered with positioning and advertising communications.
We have chosen the product category of shampoo, and for purposes of clarity
the case is confined to two basic sub-categories: “the overall benefit” category
consisting of brands that are advertised on benefits other than “anti-dandruff”;
and the “anti-dandruff” category, which covers brands that carry the “anti-
dandruff” proposition. The case requires the student to apply certain concepts
of consumer behaviour and to answer a few questions provided on the case.
Industry Overview
Hair shampoos and conditioners have been traditionally targeted at the upper
middle class. However, this category has recently expanded to include the
middle class, housewives and upper-class rural consumers. Teenagers also
form a major segment.
The shampoo market is segmented on benefit platforms as cosmetic (shine,
health, strength), anti-dandruff and herbal.
*
This case was written by Ramesh Kumar S., and Kavitha Murali, Associate Consultant, KPMG Advisory
Services Private Limited, Mumbai.
The southern market is predominantly a sachet market, accounting for

70 percent of sachet volumes. In contrast, shampoo bottles are more popular
in the northern markets with about 50 percent of the shampoo bottles sold in
the northern region alone. The size of the shampoo market in India is around
930 crores and per capita consumption of shampoo in India is 13ml. Further,
shampoo penetration all over India has been 14 percent with the urban and
the rural areas accounting for 40 percent and 10 percent of the penetration
respectively.
HLL has been the undisputed leader in the shampoo market from the early
'90s. Sunsilk was launched in 1964 on the “general shampoo” platform. Clinic
Plus was launched in 1971 as a family and health shampoo. Clinic All Clear,
a therapeutic anti-dandruff shampoo, was launched in 1987. Sunsilk was re-
launched in 1987 as a shampoo with conditioner on the beauty platform. Clinic
Active with pro vitamin B was launched in 1991. Sunsilk was re-positioned and
the brand re-launched its shampoo in 1994 for different types of hair – pink for
dry hair, yellow for normal hair, green for oily hair and black for long hair. P&G
entered India in November 1995, with the world's largest selling brand – Pantene.
Colgate Palmolive launched Optima in November 1995 claiming to have made
a breakthrough in keratin treatment. Nirma launched Nirma shampoo, which
sailed into rough weather because it also had a detergent and a soap with the
same name. The brand name also had low price connotations. In mid-1997, per
capita consumption of shampoo increased. Of the Rs 350 crore shampoo mar-
ket, the anti-dandruff segment accounted for a 20 percent share. P&G launched
its internationally acclaimed anti-dandruff shampoo. Head & Shoulders in
1997 with zinc pyrithine (ZPT) – a unique anti-microbial agent. Sachet sale in-
creased to 40 percent of all shampoo consumption in the country. In 1998, HLL
re-launched Clinic and Sunsilk brands. Sunsilk was re-launched with Fruitamins.
HLL launched Dove in March 2006, and this opened up the premium shampoo
segment. The high price, value for money and mildness connotations of the Dove
soap have stuck on to the shampoo brand as well, and helped in boosting sales.
The sales curve for the shampoo market remained almost flat at Rs 1,500 crore
in 2006–'07 and grew by just 6.6 percent in terms of value. It grew by a more-than-
healthy 14.4 percent in the three months prior to June 2007. However, Hindustan
Unilever Ltd (HUL) and Procter & Gamble (P&G), India, do not seem to have
significantly benefited from this growth. HUL's share in the shampoo market
registered a marginal increase from 46.9 percent (in terms of value) in the March
quarter to 47.5 percent in the June quarter, while rival P&G's share dipped from
25 percent to 24.8 percent in the same period.
While HUL's best-selling brand Clinic Plus continued to lead the segment
with a 31.3 percent market share, the share of Rejoice, a mass-market brand of
P&G, slipped from 2.6 percent to 2.3 percent. P&G's Pantene, however, increased
its share by 0.6 percentage points to 12 percent in the June quarter over the pre-
vious quarter. Dabur India Ltd's Vatika had a share of 4.9 percent while the share
of smaller brands such as Nyle and Ayur stood at 1.6 percent and 3.2 percent,
respectively. The positioning of leading shampoos in the market, as well as the
imagery associated with them are given in Table 3.1.
The Importance of Experiential Marketing in Marketing Communications 573
Table 3.1  Brand positioning and imagery – Shampoo market in India
Brand Proposition/
Si. Name Positioning* *Imagery of advertisement
1. Sunsilk Silky, shiny, a) Happy woman bouncing her great
voluminous, strong hair, showing off its smoothness and
and black colored hair silkiness
b) Not much emphasis on ingredients
c) Tries to strike an emotional chord with
the consumer rather than leverage on
functional benefits
2. Pantene Smooth, silky, a) Functional benefits stressed through
voluminous, full, lively, Pro-V amino acids
long, black hair
b) Shiny black hair reinforced
c) Monotonous advertisements making a
functional point
3. Dove Daily care for hair, a) Clear focus on functional benefit
damage control and
b) Clear premium image comes across in
special shampoo
the brand variants
targeting dry and
frizzy hair c) Use of ingredients – 1/4th moisturizing
milk – to stress upon the functional
benefit as well as emotional benefit
viz. mildness
4. Chik Fragrance (rose and a) Clear image of an economy brand
jasmine), strength
b) Message sent across—beautiful hair in
(egg), keeps hair
public
cool and black
c) Beautiful hair refers to hair being un-
tangled, smooth and silky
5. Head & Anit-dandruff shampoo a) Functional benefit specified clearly
Shoulders that clears dandruff in
b) 7 out of 10 dermatologists recommend
one wash Vs three
H&S—proof for functionality
washes in other
shampoos c) Boring and educational advertisement
6. Clinic All Positioned as the first a) Soft romantic advertisement
Clear anti-dandruff shampoo
b) Sends across message on hair fall and
exclusively for men
dandruff control
c) Strikes a cord with the consumer both
on emotional as well as functional terms
*—as perceived by authors
Several companies are now eyeing the growing shampoo market and the
existing players are having to defend their turf by launching new products,
reducing prices, and focusing on promotions. Companies are pushing rural
penetration by focusing on the sale of sachets. Godrej Consumer Products Ltd
recently made an aggressive entry into the market with the launch of its brand
Godrej No. 1, priced at 50 paise. The launch challenged the share of value-for-
money products such as Chik, owned by Chennai-based CavinKare. The lat-
ter's share in the market fell by 0.4 percentage points to 12.7 percent in the June
quarter. Sachets account for around 70 percent of the market. Premium brands
such as Garnier have also started selling sachets to tap the growth opportun-
ity. In the Rs 400 crore anti-dandruff shampoo market, P&G scored over HUL.
P&G's Head & Shoulders brand, the market leader in the segment, saw its
share increase by 3.3 percentage points to 54.8 percent. HUL's Clinic All Clear
saw its share fall by 2.4 percentage points to 39.6 percent. HUL launched an
anti-dandruff men's shampoo called Activsport in April–June. Recently, ITC
has launched its premium shampoo, Fiama Di Wills, with extensive advertise-
ment campaigns on frequently viewed entertainment and news channels such
as Zee, CNN–IBN, NDTV etc.
Positioning Maps
The following positioning maps have been drawn by the authors with available
data about five brands of shampoo. For reasons of ease, these brands have been
labeled as follows for reference in the maps:
S – Sunsilk
P – Pantene
D – Dove
H&S – Head and Shoulders
CAC – Clinic All Clear
(i) Price – Variety Relationship
Sunsilk is available in a whopping 23 varieties at the lowest price of

Rs 40 per 100 ml. As opposed to this, Clinic All Clear is available only in
two varieties, namely, Clinic All Clear Anti–Dandruff and Clinic All Clear
Total. Hence, it has been plotted at the left-most end of the graph but at a
price point slightly higher than that of Sunsilk as it is priced at Rs 55 per
100ml. Dove, which is the highest priced at Rs 65 per 100ml has very low
number of varieties, Damage Therapy, Dry Therapy and Normal Therapy.
Head & Shoulders is priced one rupee lower than Dove at Rs 64 and comes
in four varieties. Pantene, which is priced at Rs 61, is available in the market
in six different varieties. Considering these facts, the map has been drawn as
(ii) Price – Quantity Relationship

Except Sunsilk, all brands of shampoos considered here, including Clinic
All Clear, Pantene, Head & Shoulders and Dove, are priced per 100ml bot-
tle. Hence, they fall on the same vertical line, with changes in price points—
Rs 55 for Clinic All Clear, Rs 61 for Pantene, Rs 64 for Head & Shoulders
and Rs 65 for Dove. Sunsilk alone comes in a 125 ml pack, which is priced at
Rs 55, the same as Clinic All Clear's price at 100ml. (See Figure 3.2)
Price
D
H&S
P
CAC
S
Variety
Figure 3.1  Price–Variety Relationship
Price
H&S
CAC S
Quantity
Figure 3.2  Price–Quantity Relationship
(iii) Price – Claimed Functional Benefits Relationship

Sunsilk claims around five functional benefits including silky, shiny, volu-
minous, strong and black hair. Pantene's promised functional benefits are almost
the same but include just one more, namely, long hair. But, there is a huge price
gap between these two brands, which is adequately represented in Figure 3.3.
Price D
H&S
P
CAC
S
Claimed Functional
Benefits
Figure 3.3  Price–Claimed Functional Benefits Relationship
On the other hand, Head & Shoulders and Clinic All Clear being predominantly
anti-dandruff shampoos, have clearly positioned themselves on the dandruff con-
trol platform, and hence, are understood to provide one functional benefit. The
positions of these two brands form a vertical line towards the left end of the map
as their number of functional benefits are the smallest and equal to one another
while the difference lies only in the price, with Head & Shoulders being far higher
priced than Clinic All Clear. As a contrast to all these brands, Dove is the most
expensive of the lot, but does not provide too many functional benefits either. Its
communication strategies suggest that it has positioned itself to provide three im-
portant functional benefits only and hence assumes the center point on the x-axis
while being situated at the highest point on the y-axis in Figure 3.3.
Note: The claimed functional benefits here have been perceived by the au-
thors from advertisements of various brands of shampoo. The prices of these
brands have also been plotted on the positioning map against the number of
benefits their advertisements lay claim on.
Experiential Marketing
Experiences are events that occur in response to some stimulation, as provided
by marketing efforts before and after purchase. There is a need to provide the
right environment and setting for the desired customer experiences to emerge
(Schmitt 1999).
The five types of customer experiences that form the basis of the experien-
tial marketing framework are as shown in Figure 3.4
SENSE Appeals to the senses with the objective of creating

sensory experiences through sight, sound, touch,
taste, and smell
FEEL Appeals to customers’ inner feelings and emotions
THINK Appeals to the intellect with the objective of creating

cognitive, problem-solving experiences
ACT Aims to affect bodily experiences, lifestyles and interactions
RELATE Relates the individual to his/her ideal self, other people

or cultures
Figure 3.4  Types of Customer Experience.
Details of Methodology Used in the case
Sampling method and process

The sampling design process chosen was based on the probability sampling
process. This was because, though operationally non-probability sampling is
very simple, the estimates are not statistically projectable to the population;
since there is no way of determining the probability of selecting any particular
element for inclusion in the sample.
Further, the sample was to be chosen primarily based on a demographic
characteristic, namely, age (18–30) in this case. Hence, stratified sampling was
adopted.
Stratified sampling is a two-step process in which the population is parti-
tioned into sub-populations or strata. The strata should be mutually exclusive
and collectively exhaustive. Next, elements are selected from each stratum by
the simple random sampling process (Malhotra 2007).
In this case, a sampling frame of 200 people consisting only of women
was selected. The segment of women was targeted in order to maintain uni-
formity across the brands in the two different sub-categories, which catered
predominantly to the female population. The responses obtained were then
segregated across two sub-categories and 50 responses each were chosen ran-
domly, for each sub-category. The random choices were obtained through a
simple random sampling method by assigning a unique number to each of
the responses across the segregation and then generating random numbers
through a computer program to choose the random sample. The sample size
of 50 each for the two sub-categories is above the minimum requirement of 30
for a normal distribution, and hence, it would yield statistically significant re-
sults (Malhotra, 2007). This decision was taken after considering the time and
logistical constraints.
Activities, Interests and Opinions as a

Reflection of Lifestyle of Respondents
While the users of overall benefit shampoos are neutral towards indoor ac-
tivities and are not involved in too many outdoor activities, the anti-dandruff
shampoo users seem to be leaning more towards outdoor activities such as
sports, shopping, rock shows and partying.
On the other hand, while the users of overall benefit shampoos seem to
have neutral interests that lean neither towards indoor, reticent interests such
as music, cooking and interior design nor towards gregarious interests such as
keeping track of current affairs, the anti-dandruff shampoo users seem to have
a diametrically opposite level of interest including music, cooking, interior de-
sign and reading. The interest levels of the anti-dandruff shampoo users seem
to be in direct contrast to the activities of overall benefit users, with the latter
appearing to be involved in more relationship with the outside world.
While the anti-dandruff shampoo users have an opinion of emulating the
Western world in beauty care, an urge to try out new beauty care products
and the willingness to spend money on hair care, the overall benefit shampoo
users seem to be more reticent in this regard and are very neutral with regards
to their opinions about beauty care, hair care and grooming.
The questionnaire used in the study and the responses obtained from the
respondents on various aspects of experiential marketing are provided in
Appendices 1 and 2.
Questions
1. Compare the positioning strategies of each of the brands provided in the
industry overview with the results from respondents. Comment on the
imagery of each of the brands with respect to the results obtained.
2. Analyze each of the brands from the viewpoint of each aspect of experi-
ential marketing.
3. From 1 and 2 ,
(a) how would you formulate an experiential advertisement for
(i) the overall benefit category and
(ii) for the anti-dandruff category.
(b) point out clearly how your recommendation differentiates the new
advertising imagery from the brands discussed in the industry
overview.
4. Complete a positioning diagram that explains how your new
experiential imagery differentiates itself from the other brands in
a) the overall benefit category and
b) the anti-dandruff category.
Use the data provided in the tables as appropriate.
State your assumptions, if any, for the above questions. You may categorize
the brands into either of the sub-categories (overall benefit or anti-dandruff )
based on information provided in the case or using any additional informa-
tion, which you may find in secondary sources.
Appendix1: Questionnaire Used in the Study
Sense
This part of the study measures what you think are the benefits that the sham-
poo you use provides to you. Please mark X on the blank that best indicates
how accurately one or the other adjective describes what benefits you think
you get from your shampoo.
1. Silky ______ ______ ______ ______ _____ Rough

2. Shiny ______ ______ ______ ______ _____ Dull
3. Voluminous _____ _____ _____ _____ _____ Scant
4. Strong ______ ______ ______ ______ ______ Weak
5. Soft on hair _____ _____ _____ _____ _____ Harsh on hair
6. Fragrance ______ ______ _______ _______ No fragrance
7. Dandruff control ____ ____ ____ ____ ____ No dandruff control
8. Hair fall control ____ ____ ____ ____ ____ No hair fall control
9. Damage control ____ ____ ____ ____ ____ No damage control
10. Herbal ______ ______ ______ ______ ______ Non-herbal
Feel
This part of the study measures what emotions you feel because of using your
shampoo. Please mark X on the blank that best indicates how accurately one
or the other adjective describes what emotions you think you feel on the usage
of your shampoo.
11. Like _____ _____ _____ ______ ______ Dislike

12. Good _____ _____ _____ ______ _____ Bad
13. Pleasing _____ _____ _____ _____ _____ Displeasing
14. Exciting _____ _____ _____ ____ _____ Dull
15. Enjoyable _____ _____ ____ _____ ____ Not enjoyable
16. Enthusiastic _____ _____ _____ _____ ____ Boring
17. Adoration _____ _____ ____ _____ ____ Ecstasy
18. Contented _____ ____ ____ _____ ____ Discontented
19. Passionate_____ _____ ____ _____ ____ Indifferent
20. Happy _____ _____ _____ _____ _____ Unhappy
Think
Listed below are different facts about your shampoo. Please indicate how
strongly you agree or disagree with each by using the following scale:
1 —Strongly disagree
2 —Disagree
3 —Neither agree nor disagree
4 —Agree
5 —Strongly agree
21. Good value for money:

22. Effective on hair:
23. Gentle on hair:
24. Good variety:
25. Easily available:
26. Premium brand:
27. Augmented benefits beyond just cleansing of hair:
28. Frequency of usage needed is not high:
29. Ingredients are not harmful on hair:
30. Provides benefits as claimed on advertisements and package:
Act
This part of the study measures the reasons that make you buy the shampoo
you currently use. Please mark X on the blank that best indicates how accurately
one or the other adjective describes the reason why you buy your shampoo.
31. Good
advertisements ____ ____ ____ ____ ____ Not good advertisements
32. Attractive Not attractive
promotional offers ___ ___ ___ ___ ___ promotional offers
33. Attractive
packaging ____ ____ ____ ____ ____ Dull packaging
34. Measurable functional Non-measurable
benefits _____ _____ _____ _____ _____ emotional benefits
35. Natural
ingredients _____ _____ _____ _____ _____ Artificial ingredients
36. Rightly priced ____ ____ ____ ____ ____ High priced
37. Belief in celebrity Not belief in

endorsements ____ ____ ____ ____ ____ celebrity endorsements
38. Easy availability Not easy
of sachets _____ _____ _____ _____ _____ availability of bottles
39. Fragrance _____ _____ _____ _____ _____ Not fragrance
40. Ease of use _____ _____ _____ _____ _____ Not ease of use
Relate
This part of the study measures the kind of adjectives that you associate with
the brand of shampoo you use when you imagine the shampoo to be a person,
and the reasons that make you buy the shampoo you currently use. Please
mark X on the blank that best indicates how accurately one or the other adjec-
tive describes the personality of the shampoo you have in your mind.
41. Friend _____ _____ _____ _____ _____ Mentor
42. Trustworthy ____ ____ ____ ____ ____ Not trustworthy
43. Warm _____ _____ ______ _____ _____ Cold
44. Caring _____ _____ _____ _____ _____ Aloof
45. Sincere _____ _____ _____ _____ _____ Superfluous
46. Dependable ____ ____ ____ ____ ____ Not dependable
47. Non-traditional ____ ____ ____ ____ ____ Conservative
48. Gregarious _____ _____ _____ _____ ____ Introverted
49. Intimate _____ _____ _____ _____ _____ Professional
50. Confident _____ _____ _____ _____ _____ Insecure
Activities
Listed below, are different pastime activities that you may be associated with
or like. Please indicate how strongly you agree or disagree with each as one of
your favorite pastime activity by using the following scale:
2 —Disagree
4 —Agree
5 —Strongly agree
51. Sports:
52. Shopping:
53. Partying:
54. Watching rock shows:
55. Indoor games:
Interests
Listed below, are interests that you may have in different sectors of life. Please
indicate how strongly you agree or disagree with each as one of interest to you
by using the following scale:
2 —Disagree
4 —Agree
5 —Strongly agree
56. Music:
57. Reading:
58. Cooking:
59. Interior design:
60. Current affairs:
Opinions
Listed below, are different opinions you may have on hair care in specific and
beauty care in general. Please indicate how strongly you agree or disagree
with each one of these opinions by using the following scale:
2 —Disagree
4 —Agree
5 —Strongly agree
61. I like trying out new beauty care products:
62. I prefer natural hair care products over artificial shampoos:
63. I believe in celebrity endorsements of cosmetics:
64. I do not mind spending much on hair care:
65. I like the Western style of beauty and grooming more than the Indian
style:
Appendix 2: Scores Obtained from Respondents on Various Aspects of 584
Experiential Marketing*
*For these tables, read the scores as higher the better.
Table A1  Sense—Means of overall benefit respondents across individual characteristics
Silk Shine Volume Strength Soft Fragrant Anti D.ruff Hairfall control Damage control Herbal Average
1.92 2.1 2.67 2.84 2.04 1.92 3.1 3.18 2.52 3.25 2.55
Table A2  Sense—Means of Anti-dandruff respondents across individual characteristics
Silk Shine Volume Strength Soft Fragrant Anti D.ruff Hairfall control Damage control Herbal Average
2.3 2.6 2.5 2.95 2.29 2 1.84 3.1 2.9 3.06 2.52
Table B1  Feel—Means of overall benefit respondents across individual characteristics

Like Good Please Excite Enjoy Enthuse Adore Content Passion Happy Average
1.7 1.8 1.9 2.6 2.5 2.8 2.82 2.4 2.68 2.4 2.33
Table B2  Feel—Means of anti-dandruff respondents across individual characteristics
Like Good Please Excite Enjoy Enthuse Adore Content Passion Happy Average
1.87 2.08 2.16 2.65 2.68 2.83 3.04 2.53 2.89 2.27 2.43
Table C1  Think—Means of overall benefit respondents across individual characteristics
Value Effect Gentle Variety Avail Premium Extra benefit Usage Harmless Benefits as claimed Avg
2.27 2.28 2.2 2.22 2.18 1.84 2.34 2.92 2.68 2.81 2.37
Table C2  Think—Means of Anti-dandruff respondents across individual characteristics
Value Effect Gentle Variety Avail Premium Extra benefit Usage Harmless Benefits as claimed Avg
2.45 2.33 2.35 1.8 1.79 1.89 2.57 2.65 2.7 2.78 2.26
Table D1  Act—Means of overall benefit respondents across individual characteristics
Ads Promotion Package Function Natural Price Celebrity Sachet Bottle Use Avg
2.48 3.15 2.65 2.46 2.92 2.73 3.6 3.45 2.29 2.17 2.67
Table D2  Act—Means of anti-dandruff respondents across individual characteristics.
Ads Promotion Package Function Natural Price Celebrity Sachet Bottle Use Avg
2.4 2.65 2.3 2.49 2.9 2.43 3.3 1.97 2.4 1.87 2.39
586
Table E1  Relate—Means of overall benefit respondents across individual characteristics
Friend Trust Warm Caring Sincere Dependable Non-traditional Gregarious Intimate Confident Avg
2.6 2.36 2.65 2.5 2.68 2.39 2.68 2.83 2.98 2.44 2.5
Table E2  Relate—Means of Anti-dandruff respondents across individual characteristics
Friend Trust Warm Caring Sincere Dependable Non-traditional Gregarious Intimate Confident Avg
2.25 2.31 2.82 2.17 2.37 2.53 3.13 3.02 3.21 2.1 2.47
Table F1  Overall Experience—Means of overall benefit and anti-

dandruff categories of respondents
Overall Benefit Anti-dandruff

2.486378 2.418725
Table G1  Activities—Means of anti-dandruff respondents across

individual characteristics
Sports Shopping Partying Rock shows Outdoor games Avg

3.56 1.56 2.1 3.22 3.94 2.876
Table G2  Activities—Means of overall benefit respondents across

Sports Shopping Partying Rock shows Outdoor games Avg

1.53 2.16 1.78 1.98 1.93 1.876
Table G3  Interests—Means of overall benefit respondents across

Interior Not current

Music Reading Cooking design affairs Avg
1.12 1.05 1.35 1.23 1.3 1.21
Table G4  Interests—Means of anti-dandruff respondents across

Interior Not current

Music Reading Cooking design affairs Avg
4.175 3.21 3.42 3.78 4.21 3.759
Table G5  Opinions—Means of anti-dandruff respondents across

Do not Do not
Like trying prefer mind Like
new beauty natural Belief in spending Western
care products products endorsements on hair style Avg
2.56 3.21 3.54 2.978 2.607 2.979
Table G6  Opinions—Means of overall benefit respondents across

Do not Do not
Like trying prefer mind Like
new beauty natural Belief in spending Western
care products products endorsements on hair style Avg
1.12 2.32 2.21 1.054 1.011 1.543
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Name Index
7-up, 119 Hamara Bajaj, 144, 170, 272; Café Coffee Day, 26, 47, 75–6, 78,
RTZ, 143 123, 164
A-1 tea, 74
Baleno, 33 Campa Lime, 227
Abba, 256
Barbie, 322 Cannon, 56, 478
Adidas, 11
Barista, 47, 123 Carbon, 257, 262, 305
Aggasi, Andre, 252
Bata, 10 Carnival, 126
Airtel, 76, 552, 553, 556
Bauch & Lomb, 210, 212 Carrier, 46, 305, 309
Akai, 33, 85, 91, 100, 106, 128,
Beetles, 63, 256 Ceasefire, 82
151, 223
Bharat Sanchar Nigam Limited, Ceilo, 101, 265
Amazon, 150, 316, 322–4, 330,
547, 555–6, 563 Cema, 245, 249
353, 426
Bharti Airtel, 552 Chandrika, 20, 22
American Airlines, 349
Big Bazaar, 52, 263, 319 Charagh Din, 175
Amrutanjan, 71, 96, 212
Binny, 26 Charles Schwab, 322
Amul, 97, 195
Bisleri, 87, 97, 191 Charms, 117, 143, 144, 167, 186,
Anand, Dev, 57, 236;
Black Knight, 165 239, 271–2
Apple, 236, 237
BMW, 95, 124, 243, 245 Chik, 6, 22,77, 261, 311, 573–4
Aquafresh, 98, 374
Boney-M, 256 China, 5, 125, 453, 455, 549
Aquasure, 196, 235
Boost, 60, 68, 241, 249 Choco Cheer, 123
Aramusk, 174
Bournvita, 98, 153, 241, 302, 349 Chocos, 183, 189
Ariel, 8, 46, 213, 222, 226, 270, 311,
BPL, 59, 67, 91, 100, 109, 130, 150, Chopra, Priyanka, 250
461, 464
152, 182, 239, 241, 248–9, 252, Chrysler, 115, 118;
Arrow, 12, 56, 120
272, 305, 309, 454 Laser, 115
Arvind Mills, 169
Braun, 183, 213, 214, 227, 257 Cinthol, 40, 42, 174
Ashok Leyland, 347
Breeze, 174 Cisco, 330, 358
Asian Paints, 24, 263, 271
Britannia, 7, 22, 26, 39, 48, 55, 70, Citibank, 74
Aspro, 126, 144, 191–2
74, 87, 96, 189, 210, 222, 227, Citizen, 35, 74, 169; Ecodrive, 35
Atari, 221
262, 357, 454; Close-Up, 40, 92, 96, 98, 158, 212,
AT&T, 144, 223, 236, 358
Tiger, 7, 39, 70, 74, 77, 121, 217, 226, 228, 271–2, 311, 333,
Aveeno, 75
210, 229, 247, 262; 336, 378, 385, 387, 427–8, 431–2,
Axe, 44, 51, 166
Broadvision, 355 434–5, 513
Ayush, 20, 325
Brooklyn, 125 Coca-Cola, 144, 331
Azharuddin, Mohammad, 249
Bru, 20, 45, 116, 125, 212, 272 Coke, 6, 7, 19, 50, 68, 87, 97, 120,
Brylcream, 8, 21, 190, 198, 225 125, 133, 143, 150, 158, 188, 212,
Bacardi, 117, 165, 239, 271 BSNL, See Bharat Sanchar Nigam 247, 256, 331, 336, 341–2;
Bachchan, Amitabh, 59, 239, 246, Limited Fanta, 7, 193, 331;
252, 272 BusinessWeek, 50, 137, 144, 552 Mountain Dew, 19, 333;
Bajaj, 108, 130, 143, 144, 170, Thanda Coke, 19
174–5, 213, 224, 272, 451, 522, Cadbury, 6, 18, 22, 40, 55, 59, 61, Colgate, 11, 27, 43, 44, 49, 55, 68,
524–6, 543; 114, 120–21, 123–4, 127, 129, 83, 88, 92, 94–6, 98, 135, 137,
4S, 143; 153, 158, 164, 182, 195, 211–2, 147, 176, 186, 188, 192, 225,
Boxer, 524; 225, 227, 236, 272, 331, 349; 227, 249, 251, 261–2, 307, 353,
Bravo, 130; Bilkul, 22; 375, 377–8, 386–8, 427, 431,
Caliber, 143, 175, 524; Sweet Cadbury, 19; 451, 572;
Chetak, 143, 213; Dairy Milk, 114, 121, 124; Colgate Gel, 92, 176, 261, 431;
Classic, 23, 130; Drinking Chocolate, 97, 123, Colgate Herbal, 92, 176, 388;
CT-100, 524–5; 153, 349 Colgate Sensitive Care, 176;
598 Name Index
Colgate Total, 27, 43, 49, 92, Ford, 137, 144 Clinic Active, 198, 572;
94, 135, 137, 176, 188, 192, Forhans, 378 Lakme, 25, 50, 309, 403–4;
249, 262, 307, 353, 386, 388; Frooti, 71, 162 Lifebuoy, 40, 41, 48, 83, 164,
Protex, 227, 271 174, 186, 191, 227, 255, 271,
Color Plus, 12, 455 Garden, 175 311, 325, 435, 451;
Col-Pal, 198 Gatorade, 45 Lux, 38, 182;
Compaq, 138, 140, 161, 187 Gavaskar, Sunil, 41, 42 Lux Beauty Bar, 104;
Complan, 241, 302 GE, 137, 144 Lux International, 104;
Corum, 55 General Motors, 26, 75, 123, 143, Lux Sunscreen, 104;
Cotte, J., 332 190, 245, 329; Margo, 83, 164, 272;
Coyles, S., 326 Ambassador, 26, 123, 190 Mentadent, 92,
Croma, 263 Gillette, 12, 44, 60, 86, 91, 198, Sunsilk, 10, 41, 50, 55, 75, 94,
Cronje, Hansie, 249 236, 257; 572–5
Crowning Glory, 174, 248 Mach3, 44; Hindustan Unilever Ltd, 196, 235,
Cyberspace, 330 Sensor Excel, 44; 261, 572, 574
Vector Plus, 12, 236 479, 506
Dabbawalahs, 22 Glaxo, 26, 35, 226 Hitachi, 152
Dabur, 331, 403, 572; Godrej, 12, 24, 90–91, 99, 161, 180, HMSI, 526
Vatika, 20, 403, 572 189–90, 198, 210–12, 227, 255, HMT, 26, 40, 72
Dalda, 144, 172; 268–9, 573–4; Home Trade, 250
Dalda Activ, 172; Nikhar Soap, 255; Honda, 26, 38–9, 49, 118, 125, 172,
Dalda Light Vanaspathi, 172 Storewell, 268–9; 174, 189–92, 224, 226, 257, 265,
Davidson, Harley, 54, 146, 244, Pilsbury atta, 6, 12 334–5, 522, 524–6
331, 337, 353, 358–9, 424 Gold Plus chain, 12, 257 Horlicks, 40, 96, 97, 225, 241, 451
Dell, 26, 71, 315, 346, 360 Gold Winner, 229 Hoyer, W.D.,, 242, 342, 397
Dettol, 19, 22, 28–9, 33, 45, 98–9, Grasim, 68 HP, 71, 138, 215
102, 159, 164, 186, 191–2, 195, HUL, See Hindustan Unilever Ltd
210, 225, 236, 513 Hunt, S. D., 341, 376
Haldiram, 74
Dev, Kapil, 41, 241 Hutchison Essar, 553
Hamstead, 249
Digjam, 247 Hyundai, 7, 125, 256, 331, 434, 456–7
Harley Davidson Owners’
Disney, 125, 137, 144 Group, 359 IBM, 125, 144
Dockers, 322, 459–60 Harvard Business Review, 319 Imox, 30
Domex, 98 Hazare, Vijay, 42 IMRB, 77
Double Bull, 115, 175 HCL, 192 India; cultural diversity, 183;
Dove, 19, 39, 44, 50, 72, 106, 131, Head & Shoulders, 572–4, 576 cultural habits, 6, 211, 227;
162, 336, 488, 572–4, 576 Heinz, 33, 72 cultural trait, 6, 272, 461;
Dravid, Rahul, 59 Hero Honda, 26, 39, 49, 118, 174, festivities in, 33;
DTS, 547 189, 191–2, 226, 334–5, 522, food habits and tastes, 6;
524–6; marketing, 4, 17, 58, 255,
Eno, 164 CD-Dawn, 524, 543; 272, 451,
Ericcson, 117 Honda Passion, 39, 334; challenges and complexities, 4,
Eureka Forbes, 195–6, 235 Honda Shine, 39; cultural dimensions, 5, 270,
Eveready, 72, 118 Honda Splendor, 39, 174, 394, 451,
Everest, 51 334; diversity of, 5;
Honda SS, 39, 334; opinion leadership in, 56;
FabMall, 322, 324, 480–81 Passion, 39, 174, 334, 524, per capita income, 4, 60;
Facebook, 241 543; retailing market in, 32;
Fairever, 97, 227–8, 404 Splendor, 39, 174, 334, 524 rural market, 50;
Fair & Lovely, 7, 18, 20, 27, 42, Himalaya, 27, 31, 34, 144, 172, socio-economic classification
76, 97–8, 129, 195–6, 222, 227–8, 239, 241, 272 of, 548, 562;
271, 404 Hima Peas, 226 unorganized market in, 9
Famicom, 221 Hindustan Lever Limited, 8, 38, Indian Coffee House, 26
Fastrack, 60, 121, 166, 177–8 49–50, 55, 58, 68, 69, 83, 92, 94, Indica, 27, 102, 162, 172, 457
Federal Express, 359 96, 99, 103–4, 147, 164, 174, 198, Infiniti, 245
Fevistick, 134, 367 228, 239, 243, 245, 247, 249, 262, Infosys, 197
Finlandia, 125 461, 572; Intel, 26, 137, 140–41, 144
Flyte, 58 Clinic, 10, 41, 50, 94, 198, 225, Iodex, 40, 72, 96, 192, 212
Food World, 86, 97–8, 102, 106, 271, 335, 403, 572–4, 576; iPhone, 110, 164, 236–7, 251, 367
229, 295, 302, 481 Clinic All Clear, 41, 572–4, 576; Italy, 45, 125, 245, 254, 452
Name Index 599
ITC, 22, 27, 50, 574; LG, 27, 46, 56, 67, 71, 83, 91, 96, MCI, 240
e-Choupal, 22; 100, 107, 120, 125, 152, 185, 189, Medimix, 228, 296
Fitkit, 50; 210, 212, 264, 292, 294, 309, 357, Mercedes, 45, 95, 123, 144, 256,
Sunfeast, 27, 33, 50, 59 374, 437, 451, 470; 259, 330, 74, 113, 159, 166, 172,
Itch-Guard, 114, 226 Golden eye, 101, 136 245
ITunes, 24, 236 Liberty, 10, 22, 117 Merlin, 72, 211
Lifestyle, 12, 30, 299, 398, 468 Mexico, 452, 453, 549
Lin, C., 372–5 Microsoft, 77, 137, 139, 144, 236,
Jackson, Michael, 256
Lindstorm, Martin, 142, 322; 343;
Japan, 5, 124, 125, 214–5, 254, 267,
Clicks, Bricks and Brands, 142 Nintendo, 77, 221;
454, 459
Lipton, 40, 69, 103, 236 Xbox, 77
Jawa, 26
Liril, 38, 107, 166, 174, 307, 513 Milkfood, 145
Jenson & Nicolson, 116
Listerinet, 192 Miss Players, 12
John Players, 12
Listrine, 21 Mitsubishi, 115;
Johnson & Johnson, 35, 75, 123,
Lizol, 98, 102, 106 Eclipse, 115
195, 332;
LML, 174–5, 524–5; Modi Xerox, 26, 192
Shower to Shower, 123
LML Vespa, 174–5, 245 Mont Blanc, 67, 74, 259
Journal of Customer Behaviour, 371
L’Oreal, 90, 211 Moov, 192
JJVC, 152
Lyril, 325 Mother’s Recipe, 51, 306
Motorola, 26, 56, 78, 138, 554;
Kasper, 373 iPointers, 138;
Mac, 236
Kelvinator, 91 Yuva phones, 78
MacInnis, 242, 334, 342, 397
Kenstar, 210 Mouthshut.com, 75
Madura Coats, 49, 123, 318;
Kent, 196, 235 MTNL, see Mahanagar
Allen Solly, 12, 123, 175, 240,
Kessler, 478, 482 Telephone Nigam Limited
309, 455;
Khan, Imran, 42 MTR, 74, 227
Louis Philippe, 49, 55–6, 67,
Khan, Shah Rukh, 76, 120, 246, MTV, 257
120, 123, 166, 327, 356;
250, 457 Mysore Sandal, 106, 174;
Peter England, 49, 123;
Kids Kemp, 101, 108 Mysore Sandal Gold, 106
Van Heusen, 56, 123, 136,
Kinetic Engineering, 522 Mystic Gold, 119
173, 327
Kinetic Honda, 38, 172, 190, 192 Maggi, 6, 40, 72, 159, 183, 195,
Kinetic Motor, 522 NCAER, 548, 562
236, 265, 270, 462
Kinley, 87 Nerolac Paints, 331
Mahanagar Telephone Nigam
Kissan, 72 Nestlé, 6, 28, 87, 120, 123, 222,
Limited, 547, 563
Kit Kat, 98, 331 227, 236, 331, 336;
Mahindra & Mahindra, 20, 22;
Klein, Calvin, 126, 394 curds, 28;
Scorpio, 20, 22
Knox, S., 373, 375, 379 Nesfit, 123
Malaysia, 125, 549, 556
Kodak, 56, 144, 148, 212 Netscape, 139
Malhotra, Naresh K., 398, 577–8
Kohinoor, 31, 247 Nike, 11, 76, 125, 143, 164, 256,
Mankad, Vinod, 42
Korea, 125, 256, 456 260, 321, 451
Manning K. C., 478, 482
Kores, 26, 72, 191 Nilgiris, 106, 149, 229, 292
Maria, J. Y., 376
Kotler, Philip, 21, 324, 506 Nippon Telegraph, 214
Marico, 9, 61, 197, 202, 205–6
Krack, 226 Nirma, 74, 98, 121, 223, 227–8,
Marlboro, 67
Krishna Tulasi, 228, 296 461, 572;
Maruti, 22, 26, 33, 72, 119, 131–2,
KS, 8, 543 Nissan, 123
135, 153, 161–2, 166, 177, 195,
Nokia, 9–10, 48, 76, 144, 186,
213, 257, 348, 456;
195–6, 215, 241, 545
Lactogen, 216 Swift, 22, 348;
Noodles, 51
Lakhani, 74 Maruti 800, 131, 153, 213,
Lakme, 25, 50, 309, 403–4 257, 348, 456;
Lay, 55 WagonR, 102, 119; Old-spice, 198
Legwear, 115 Zen, 86, 119, 153, 456 Omega, 142, 143, 164, 249, 256
Lenova, 138, 182, 215 Matiz, 86, 162, 456 Onida, 46, 55, 124, 149, 169, 223,
Leo, 265 Matsushita, 236 309;
Levi’s, 76, 116, 125, 215, 322, Mattel, 125, 265 Ultra Slim, 46
459–60, 464 Mazda, 44; Miata, 44 OnStar, 329
Levi Strauss, 459, 464–5 McCartney, Paul, 252 Oracle, 355
Levitt, Theodre, 23, 25 McDonald, 125, 137, 144, 162, Oriflamme, 84
Levy, Sidney, 135, 429 212, 240, 243–4, 254, 257, 265, Orkut, 241
Lexus, 45, 125, 245, 343 306, 354 Ovaltine, 97
600 Name Index
Palio, 239, 331, 428 Red Label, 38, 69, 96, 191, 210, Blackout, 55
Panasonic, 152, 360 225, 311 Spice Telecom, 556
Pantene, 572–5 Reliance Infocom Ltd, 553 Spielberg, Steven, 245
Papa John, 136 Renault, 123 Sprint, 227
Parachute, 9, 12, 30, 40, 49, 55, Reva, 184 Subiksha, 305, 322
76, 190, 201–2, 207, 226, 236, Reynolds, 31, 97, 128, 161, 210, Sumeet, 67
311, 403; 213, 229, 334, 479 Sun Direct TV, 216
Sampoorna, 40, 49 Rin, 49, 224, 461 Sunfeast, 27, 33, 50, 59
Park Avenue, 12, 34, 55–6, 115, Robin Blue, 39, 96, 164, 270 Sunny Zip, 129
120, 124, 166, 198, 212 Rokeach Value Survey, 452 Surf, 49, 96, 98, 158, 162, 225,
Parker, 59, 249, 259 Rolex, 113, 142–3, 164, 256, 259, 240–41, 261–2, 311, 316, 451,
Parry’s, 12, 22 299 460–62, 464–5;
Pass Pass, 210 Rolls Royce, 124 Surf Excel, 98, 158, 162,
Peapod, 324 Rooh Afza, 123 241, 262, 311, 316,
Pears, 48, 136, 325 Roshan, Hrithik, 250 460–62
Pentax, 56 Rowling, J.K., Swatch, 56, 454–6, 464–5, 470
Pepsi, 6, 7, 18, 42, 67–8, 87, 97, Harry Potter, 245 Sweden, 125
107, 116, 120, 125, 133, 143, 148, Royal Enfield, 146, 521–22, 524; Switzerland, 124, 455
158, 188, 241, 247, 249, 272, 331; Bullet Machisma 500, 146
Miranda, 7; Ruf & Tuf, 65, 169, 255, 272 Taiwan, 125, 452
Pepsi Blue, 42; Russia, 5, 125 Taj, 21, 58, 222, 402
Pepsi Gold, 42 RVS, See Rokeach Value Survey Tata, 55, 103, 142, 554–5, 563;
Pepsodent, 96, 270, 427, 431, 432,
Tata Teleservices Ltd, 554;
433, 435 Sabeena, 98, 229 TCL, 172;
Perfetti, 125 Sacs, Goldman, 5 Telco, 347;
Perk, 331 Saffola, 9, 30, 164 TISCO, 139
P & G, see Proctor & Gamble Sahara, 331 Telephone Public Corporation,
Philips, 55, 56, 109, 151, 182, 191, Sample National Survey 214
212, 214, 248, 457; Organization, 3 Telephone Regulatory Authority
Power House, 46, 55 Samsonite, 34 of India, 547, 548, 551, 563
PHX, 248 Samsung, 27, 56, 68, 72, 83, 100, Tendulkar, Sachin, 43, 123, 239,
Pizza Hut, 136, 254, 257, 265 125, 136, 152, 185, 192, 210, 212, 246, 429
Planet M, 455 248, 270, 292, 309, 331, 348, Tesco, 322, 324, 477
Pleasure, 39, 58, 108 355, 451 Tex, 12, 236
Polo, 114, 222 Santro, 7, 26–7, 58, 60, 86, 100, Thailand, 125, 452, 549
Pond’s, 10, 123, 127, 131, 226, 102, 120, 161–2, 169, 172, 193, The Hindu Businessline, 250
271, 347 210, 245, 248–9, 257, 331, 427–8, Tide, 8, 44, 46, 330, 334
Pond’s, 35 434, 456–7, 464–5, 470 Titan, 22, 26–7, 46, 48, 59–60, 73, 83,
Proctor & Gamble, 8, 245, 254, Sanyo, 152 117–8, 120, 123–4, 142, 148, 158,
336, 347, 374, 572, 574; Sara Lee India, 198; 161, 164, 177, 182, 195, 217, 227,
Ariel, 8, 46, 213, 222, 226, Brylcream, 8, 190, 198, 225 229, 257, 260, 268–9, 272, 291,
270, 311, 461, 464; Savlon, 99, 192 305, 455;
Tide, 8, 44, 46, 330, 334 Scooty Pep, 58 Bandhan, 74, 263;
Pugeot, 123 Shell, 159 Dash, 74;
Pureit, 196, 235 Shiseido, 326 Fast Track, 27, 39, 74, 117;
Shoppers’ Stop, 30, 108, 263, 295, Nebula, 74;
Quaker, 11, 40 306, 319, 324, 455, 460 Raaga, 59–60, 272;
Quelch, John, 478 Siebel, 355 Sonata, 27, 60, 123, 222;
Siemens, 26 Tanishq, 12, 257, 259, 262–3,
RaboCom, 547–8 Siyaram, 175 299, 305;
Radio City, 230 SmithKline Beecham, 374 Xylys, 123
Ragimalt, 97 Sony, 26, 46, 56, 74, 77, 113, 117, Toyota, 45, 75, 330, 430; Lexus, 45,
Rajdoot, 72, 174, 178, 249 124–5, 144, 162, 212, 236, 294, 125, 245, 343
Rasna, 55 330, 341, 451; TRAI, See telephone regulatory
Ray Ban, 74, 90, 132 iPod, 46, 55, 76, 236; authority of India
Raymond, 26, 49, 61, 76, 107, 113, MP3 players, 46; Tropicana, 99, 181
115, 119–20, 124, 131, 142, 175, plasma TV, 46; T-Series, 121, 227
187, 354 Reebok, 11, 74, 299; Tupperware, 84, 188, 217, 240
Rebel, 252 Trinitron, 124 TVS, 26, 43, 94, 457–8, 522, 524–6;
Red Bull, 19, 45, 57, 75, 121, 158 Spear, Britney, 55; TVS Scooty, 94
Name Index 601
UK, 124, 322, 452 Bazooka, 123; Wills Lifestyle, 12

Unilever, 12, 196, 235, 236, 255, Challenger, 123 Wipro, 20, 137, 142, 197, 255;
261, 303, 460, 572; Vietnam, 125 Santoor, 255
Annapurna atta, 12; Vim, 74, 98, 224, 228 World Space, 24, 49, 152;
Hamam, 83, 174, 228, 255, 273 Vimal, 175, 247 concept of, 24
United States of America, 5, 6, Virmani, Arvind; Virmani Index World Space Music, 152
30, 44, 118–9, 145, 161, 191, 240, of Power (VIP), 5
244–5, 254, 260–61, 324, 353, Vivek & Co., 101, 292, 294, 309
452–4, 457–9, 480, 556, 562; Vodafone, 552–3, 556 Xerox, 26, 144, 346, 360
economy of, 5 Voltas, 91
Volvo, 120, 143, 245, 330, 355, 454
Van Heusan, 12 Yamaha, 174, 522, 525–6, 543
Vendee, 74, 128, 129 Wal-Mart, 125, 245, 347, 477 YouTube, 75, 220
Vicco, 20, 96, 271, 378 Walt Disney, 125
Vicks Vaporub, 271 Wheel, 98, 335
Victor, 331, 524, 543 Whirlpool, 52, 72, 91, 100–101, Zero B, 183, 185
Videocon, 9, 91, 100, 123, 137, 152, 193, 210, 212, 292, 451, 457–9, Zodiac, 72, 175
182, 185, 309; 464–5, 470 Zylus, 27
Subject Index
acquisition, 121, 145, 259, 355, awareness, 90, 205–6, 218, 306, additional, 180;
357, 361, 552, 554 529, 533, 536, 541 brand, 189–90;
advertising; interrelated, 180–81
advertorials, 116; behaviour brand;
campaign, 12, 70, 72–73, 86, buying, 65, 174, 239–40, 435, adaptability and, 61;
109, 172, 195, 224, 231, 245, 439; air coolers, 3;
270, 457, 503; compulsive, 108; appliances, 7, 29, 118, 130,
celebrity, 9, 39, 58, 60, 68, consumer, 5, 17, 23, 28, 41–2, 215, 218, 262, 266, 300, 324,
248, 250; 53, 56, 60, 65–6, 68–71, 75, 333, 452, 457;
celebrity usage in, 245; 77–8, 142, 147, 149, 152, apparel,18, 23, 34, 46, 55–6,
communication, 51, 220; 156, 158, 163, 174, 179, 209– 60–61, 68, 78, 124, 129, 142,
comparative, 102, 161, 172, 10, 222, 226, 230–31, 234, 173, 175, 181, 215, 236, 240,
192; 245, 253–4, 261, 291–3, 318, 256, 273, 297–9, 364, 468,
creative, 114, 251; 355, 372, 394–5, 423, 425–6, attributes and benefits, 12,
expansion, 369, 499, 500, 502, 478, 486, 503, 571, 59, 189, 334;
504–5, 507–13; aspects of, 68, challenges for, 62;
feature-based, 292; brand success and, 69, cheaper, 132;
glitz and glamour of, 9, 19; changes in, 23, 41, commodity and, 28;
long-term, 100; concepts of, 70, 75, 147, 571, competing, 67, 121, 132–4,
online, 51, 332; decision making, 67, 81–2, 162, 248, 329, 355, 357, 361,
press campaign, 117; 291, 322, 336, 424, 365, 437, 501;
primary, 82–3; dimensions of, 5, 355, development of, 9, 11–2, 38,
surrogate, 165 group concept, 67, 68, 239, 424;
advergaming, 322, 331; 245, dominant, 98, 190, 222;
after-sales service, 54, 84, 105, impact of, 355, endorsement of, 42;
107, 150–51, 153, 293, 296, 300, knowledge of, 147, entrenched, 131, 375;
329, 337, 349, 360, 528, 538, 542 marketing mix and, 71, favourite, 96, 387;
attitude, 58–9, 65–6, 68–9, 103–5, marketing strategy and, 77, global, 21, 45, 73, 113, 132,
179–88, 191, 193–4, 196, 452–3, nuances of, 53, 181, 249, 267, 322, 374,
487–9, psychographics in, 60, 453–4, 465, 468, 471,
affective, 181–2; psychological, 66; global vs local, 465, 471;
cognitive, 181–2; cultural, 270, 461; hi-tech, 109;
conative, 181–2; fixated, 174; ideal, 193, 195;
concept of, 179; goal-related, 68; image, 27, 109, 121, 132, 146,
conflicting, 188; group, 68; 158, 222, 249, 394, 511;
consumer, 182; habitual, 96; Indian, 117, 195, 325, 410;
favorable, 182–4, 188, 204, impulse, 318; leading, 98, 224, 309, 386,
303, 353; purchase, 59, 293, 372, 377, 525, 558, 564;
formation of, 168, 182–4, 379; lifestyle, 7, 117, 331, 378;
impact on, 184, shopaholic, 108; local, 5, 51, 67, 70, 463;
role of beliefs in, 183, shopping, 478, 482, 487; low penetration of, 236;
types of influence on, 183; symbolic, 267; multinational, 5–6, 265, 291,
individual, 180; traditional, 270 369, 374–5, 404, 423, 451;
positive, 179, 182, 184–5, beliefs, 8, 27, 30, 79, 99, 145, 170– name, 11, 35, 39, 41, 113, 118,
188, 409 71, 179–83, 189–90, 194–6, 213, 125, 128, 210, 293, 296, 478;
availability, 27, 68, 87–8, 95, 107, 222, 227, 235, 253–4, 258, 261, national, 4, 97, 296, 297, 410;
132, 134, 175, 294, 303, 305, 309, 270–3, 314, 341–2, 367, 395, 397, need for, 23, 51, 321;
348, 352, 365–6, 384, 404, 429, 438, 444, 453, 457, 462–3, non-multinational, 6;
513, 521 487; options, 11;
Subject Index 603
owners, 33; branding, 3, 13, 17, 20–21, 23–6, brand repositioning, 8, 70, 120–
personal care, 7, 44, 183, 213; 28–31, 34–6, 39, 50–51, 58, 81, 21, 125–32, 134, 192, 367, 459;
personality, 174–5, 178, 423, 91, 95, 119, 138–41, 144, 147, celebrity-oriented, 130;
436; 179, 182, 227, 239, 253, 264, 273, concept of, 125;
pioneering, 8, 21, 31, 40, 69, 291, 311, 317, 372–3, 385, 388, image-oriented, 131;
82–3, 98, 124, 141, 154, 158, 393–5, 404, 423, 469, 520; importance of, 128;
160–61, 179, 191, 212–3, commodity, 30; kinds of, 127;
222, 225–6, 350; competitive, 28; niche-oriented, 131;
profitability of, 32; concept of, 25, 28, 138; perception–intention
quality, 169; contextual, 24; framework, 132;
readymade, 175; conventional, 24; repackaging, 134;
regional, 9, 27, 98, 106, 229, experience-based, 24; SCP-oriented, 133;
357, 374–5, 403, 423; impact of, 21, 139; segment-oriented, 129;
retail, 28, 97, 292, 322; power of, 36; symbolism-oriented, 130;
seamless transition and, 61; process of, 140; technology-oriented, 131;
seriousness of, 38; communication, 141; value-oriented, 128
store, 229, 292, 296–7, 300–01, selecting the brand brand success, 8, 53, 69, 77, 122,
478; proposition, 140; 142, 160, 166, 191
strong, 26, 31, 34, 51, 100, products, 3; brand trust, 371–3, 375–6, 378–9,
104, 129, 158, 160, 163, 174, scientific principles, 26; 381–9
271, 342, 428; services, 3; brand value, 34, 39, 525
successful, 61, 115, 125, 128, synergistic approach to, 25; business, 23–4, 130, 295, 307, 311,
134, 393, 424; technology-oriented, 138; 322, 325, 344–7, 352, 355, 361,
success of, 26; value and, 139 394, 552, 556, 558;
symbolism, 62, 377, 379, 383; brand life cycle, 175–7 transportation, 23;
target-segment-related, 29; brand loyalty, 53, 55, 67, 88, Southwest Airlines, 23–4,
timing of, 8, 226; 98, 182, 225, 323, 325, 352–4, 97, 358
unknown, 5, 36, 37, 229, 230, 369, 371–9, 382–8, 423–9,
331, 343, 488; 433, 435–6, 499–502, 504–5,
well-known, 10, 40, 45, 106, 510–13, 546 CDM, see consumer decision
169, 190, 211–2, 229, 243, brand message, 147, 148 making
295–6, 300, 303 brand name, 35, 41, 50, 100, 106, cognition, 171–2, 184, 453;
brand association, 34, 38–40, 47, 115, 117–8, 120, 125, 132, 134, importance of, 171;
55, 63, 118, 122, 127, 129, 132–3, 144–6, 157, 162, 164, 177, 257, need for, 171–2, 184
141, 164, 188, 385–7, 423–4, 427; 270, 273, 29–6, 314, 316, 323, collectivism, 318, 395, 424, 462,
challenge of, 39; 355, 366, 430, 486, 553, 556, 465, 467, 471
development of, 54, 135; 558, 572 commodity, 28–31, 226, 295, 317,
effective, 40; brand personality, 54, 58, 70, 106, 366, 461;
importance of, 39, 40; 116, 126, 127, 130, 157, 168, 174, brand and, 28
long-term impact of, 127; 175, 177, 178, 249, 336, 341, 369, compatibility, 213, 216, 549
new brands and, 40; 405, 423, 424, 426, 428, 429, 431, complexity, 214–5
power of, 38; 433, 434, 435, 436, 437, 571 compulsivity, 318
selection of, 148; brand positioning, 20–22, 49–50, conditioning, 147–50;
strengths of, 164 59, 66, 69–70, 72, 75–7, 87, basics of, 152;
brand awareness, 43, 72, 89, 99, 89–91, 94–5, 99, 103, 106, 116, classical, 148;
108, 126, 131, 193, 477, 485–6 119–21, 124–37, 143, 159, 166, concept of, 147;
brand benefit, 83, 90, 97, 129, 193, 170, 178, 183, 185, 189–91, 211, instrumental, 76, 149–50,
225, 270, 332, 371, 379, 382–8 240, 255–6, 267–72, 296–7, 321– 154, 182,
brand building, 92 35, 362, 373, 385–6, 394, 427, satisfaction phase, 150,
brand consideration, 90 435, 437, 459, 462–4, 468–9, 503, search phase, 151–2
brand-cricket, 41 519, 544, 556, 571–4, 576; confusion, 47
brand decision, 25, 302 contemporary, 272, 326; congruence, 162
brand differentiation, 60, 69, 95, innovative, 330; conservatism, 406, 411, 413–5
104, 243, 313 loyalty-related, 324; consumer; age-cycle and, 62;
brand diffusion, 212, 221; off-line, 325–6, 329, 333–7; aspirational levels of, 169;
dimensions of, 221 online, 325–6, 332–4; behaviour, 156, 158, 174, 261,
brand equity, 34, 50, 72, 74, 83, 97, symbolic, 130, 334 293, 318, 372, 426;
133, 248, 323, 372, 425; brand proliferation, 56, 65, 161, beliefs of, 30, 171, 183, 189,
implications on, 372 307, 324, 372, 385 196,
brand image, 27, 67, 109, 121, 129, brand proposition, 7, 127, 140–41, buying spree of, 32;
132, 146, 158, 222, 249, 394, 511; 147, 166, 187, 247–8, 355, 375, choice set of, 91;
framework for, 135 510, 573 commitment levels of, 96;
604 Subject Index
confidence of, 31, 56; dimensions of, 101, kinds of, 154, 350, 360;
contextual creativity and, 20; nature of, 93, life-cycle, 360;
culture, 12; types of, 94; lifetime, 152, 348,
decision making, 67, 81–2, information Search and, 92; concept of, 348;
291, 322, 336, 343, 424, intercept, 98; loyal, 152, 348
dogmatic, 171; limited, 88, 98; customer acquisition, 361
emotions of, 30; maintenance, 96; customer equity, 352
evolution of, 8; preference, 100; customer loyalty, 23, 25, 53, 60,
expectations of, 89, 248, 302, stages in, 82; 328, 362, 425–6
367; types of, 87–9 customer mapping, 359, 362–3,
habits of, 8, 11, 462; consumer defection, 53 366;
impulse profile of, 86; consumer life cycle, 110 concept of, 362, 366;
individual, 66, 154, 328, 394; consumer mindset, 179, 231 implications of, 366
interests of, 151; consumer needs; brand offerings customer migration, 53, 60, 326,
kinds of, 168, 261, 295, 379, and, 54; 426
423; importance of, 76 customer relationship
loyal, 76, 88, 109, 170, 174, consumer preference, 48, 65, 360, management, 53, 150, 344–8,
295, 298, 307, 310–12, 336, 377 352, 355–62, 364, 366–7,
353, 356, 358, 372–3, 387–8, consumer psyche, 52, 67, 74, 91, 426;
425–6, 501, 503–4; 134, 142, 147, 150, 160, 248 advantages of, 344;
mindset, 25; consumer referrals, 56 aspects of, 345, 356;
needs of, 25, 54–5, 72, 87, consumer response, 67, 92 concept of, 344, 361;
138, 187, 254, 312, 322, 324, consumer retention, 54 customer-centric, 364;
347, 359, 488; creativity, 19–22, 38, 114, 117, 128, dimensions of, 358;
niche, 25, 95, 184, 265, 317; 135, 147, 337, 409, 469, 488; instrumental conditioning
perceptions of, 254; application of, 20; and, 149–50;
preferences of, 48; contextual, 20–22, linkages, 345;
price-sensitive, 33; timing of, 21; objectives of, 346;
privileged class, 20; focused, 147; practice-oriented, 361;
prospective, 38, 122, 309, 329; kinds of, 20 prerequisites to, 344, 348;
psychographics of, 77, 91–2, credit card, 53, 259, 313, 347, prospects of, 358
119, 134, 153, 154, 178, 203, 357–8 customer retention, 53, 100, 324,
211, 228, 241, 292, 301, 337, CRM, see customer relationship 352, 355, 358–9
350; management customer satisfaction, 53, 309,
qualification of, 357; CSP, see cult-oriented selling 341, 343, 345, 362, 366, 425–6
responsiveness of, 173; proposition customer satisfaction trap, 362
satisfied, 38; CST, see customer satisfaction customer service; costs of, 139
sensory adaptation, 113; trap customization, 24–5, 58, 221, 324,
social class, 11; cult-oriented selling proposition, 327, 358, 360, 366;
tendency of, 169, 173; 158 value-based, 324
time compression of, 23; culture, 11–2, 21, 37, 39–42, 70, 71,
transition of, 259; 73–6, 78, 168, 183, 189, 227, 253–
types of, 22, 295, 387, 436; 62, 264–5, 267, 269–73, 394–7, 404, database, 31, 107, 109, 151, 153,
urban, 6, 253; 424, 451–3, 467, 469, 477, 546; 219, 266, 323, 326, 337, 345,
value-oriented, 33 American, 125; 347–50, 356–8, 386, 551
consumer attention, 98, 114, 146 characteristics of, 254; delivery, 24, 45, 266, 296, 299, 301,
consumer buying, 65, 68, 388 collectivist, 318, 452, 467; 308, 311–3, 322, 356, 365,
consumer choice, 48, 50; consumer, 395; dependability, 13, 37
complexities of, 50 core values, 260–61; discount, 20, 29, 32, 34, 52, 120–
consumer decision making, 53, English, 254; 21, 219, 295, 298, 301, 311, 322,
67, 81–4, 86, 88–94, 98–105, 124, Indian, 6, 9, 42, 144, 254–5, 345, 424, 441, 479, 482
235, 291, 322, 336, 343, 424; 260, 262, 264, 269, 272–3, diversity, 3, 5, 9, 28, 58, 65, 76–7,
acceptance, 100 396–7, 404, 451, 457, 463, 172, 183, 323;
aspects of, 81; family-orientation, 261, complex, 9;
basic model of, 82; festivities, 262–3, cultural, 3, 183;
brands and, 89; mythology, 264, economic, 3
capture, 97; savings, 262; dogmatism, 170, 171
disrupt, 96; rituals, 254, 256, 259–60, 266, Double Jeopardy, 372, 425
impulsive purchase and, 86; 269, 395, 397, 407;
information search, 84, 92, role acquisition, 259; e-commerce, 9, 344
101, 110, role transition, 259 e-mail, 213, 237, 329, 356, 358
degrees of, 110, customer; hardcore, 360, 364; e-positioning, 330
Subject Index 605
economy, 5, 10, 25, 119–20, 125, influence, 69, 106, 141, 145, 173, research on, 372;
130–32, 162, 166, 172, 189, 226, 183, 196, 224, 241–3, 257, 344, considerations for, 349;
266, 352, 377, 524–5, 544, 545–6, 366, 376, 382, 388, 390, 394–5, databases and, 155, 351;
573; 425, 429, 464, 468; emotional, 424;
aspects of, 5; genetic, 377, 382–3, 390; high, 365;
growth in, 5; informational, 243; initiatives, 371;
impact of the unorganized intergenerational, 377; kinds of, 354;
sector on, 10; interpersonal, 173, 242; lack of, 365;
service, 25, 266 normative, 242, 243 low, 364, 365, 366, 388, 513;
Elaboration Likelihood Model, innovation, 28, 57, 70, 95, 191, non-transactional, 350;
192–3 209–10, 213, 215, 217–8, 223, nransactional, 350;
ELM, see Elaboration Likelihood 234, 237, 357, 439; price-based, 311;
Model diffusion of, 70, 95, 209–10, pricing and, 155, 351;
emblems, 256–8, 397; 213, 215, 217–8, 230; retail, 310, 312;
kinds of, 256 characteristics of, 213; store, 311, 353
emotion, 30, 67, 78, 138, 148–9, classification for, 217;
177, 268, 341, 424; framework for, 218 MAO, see motivation, ability and
usage of, 30, 78, 177 innovativeness, 169, 173, 402, opportunity
emotional selling proposition, 405, 429 marked retail price, 263, 311
142 Integrated Marketing market; Asian, 74, 458;
endorsement, 6, 42, 59, 102, 119, Communication, 43 business-to-business, 346;
241, 250, 456–7 Interactive Home Shopping, car, 23, 331, 351, 434;
entry barriers, 435, 451 313–7; cellular phone, 28;
ESP, see emotional selling alternatives in, 315; cluttered, 126;
proposition information search and, 314; commodity, 31;
ethnocentrism, 130, 169–70, 175, retail outlet-commodity crowded, 222–3;
410, 412–3, 415–6, 429–30, 432, and, 317 detergent, 24;
439, 444, 457, 465, 468 interactivity, 321, 326–8 develeping, 28;
exclusivity, 151, 168, 294, 305, International Cultural Content developed, 9, 11, 28, 33, 44,
327, 376 Difference, 453 46, 52, 60, 105, 140, 152,
expectation, 306, 341, 367 Internet, 3, 139, 149, 172, 184, 216, 245, 308, 348, 369,
197, 210, 214, 221, 250, 267, 295, 451–2, 457, 499, 520;
fatalism, 407, 412–4, 416 299–300, 313, 317, 322, 324–7, developing, 324, 328, 374,
focus group, 423, 428–9, 454, 329–30, 337, 355, 358, 528, 532, 393, 499;
464–6, 505–7 535, 551, 554–5 expansion, 9, 12, 48;
interpretation, 116, 118–9, 384, geographical, 47, 229;
394, 402, 519 higher-end, 10;
gifts, 148, 231, 260, 263, 267–9,
JND, see just noticeable difference homogeneous, 126;
312, 322, 409, 437, 465, 472
just noticeable difference, 46, 114 diversity of, 5;
industrial, 356, 360;
hedonism, 44–7, 58, 75–6, 177,
learning, 67, 68, 95, 100, 108, 136, international, 74, 451, 455;
319, 374;
147, 151, 156, 161, 163, 182, 301, Korean, 456;
delivery of, 45;
324, 342, 353, 395; leisure and luxury, 65;
lifestyles of, 47;
cognitive, 182; local, 7, 10, 126, 314, 333, 374;
marketing implication of, 46;
principles of, 147; localised, 70;
services and, 45, 46
process of, 342; lower end, 3;
household, 3, 6, 8–9, 29, 42, 82, 95,
theories of, 147 mass, 4–8, 10, 49, 56, 73–4,
116, 125, 216, 264, 398, 505, 548;
loyalty, 23, 25, 50–51, 53–5, 60, 67, 98, 236, 360;
income, 32, 373, 398, 428,
88, 97–8, 101, 109, 152–5, 182, mobile, 9, 62, 554;
521;
225, 292, 296, 310, 311–2, 313, music, 10;
Indian, 3, 6, 8, 9, 264;
322–6, 328, 336, 341, 344–56, niche, 3–4, 35, 73, 83, 91, 131,
USA, 125
358, 360–67, 369, 371–79, 381– 146, 226, 229, 262, 325,
Hyde effect, 249
89, 423–31, 433–38, 442, 447, 356, 373;
499–502, 504–5, 508–13, 545; organized, 9, 126;
ICCD, see International Cultural attitudinal, 372, 379, 425, penetration, 3, 6, 8–12, 21,
Content Difference 430, 504; 28, 33–4, 38, 43, 60, 72,
IHS, see Interactive Home brand, 352–3, 371–2, 381–3, 97, 121–2, 153, 169, 198,
Shopping 385–6, 389, 423, 436, 499, 205–6, 224, 227, 236, 266,
IMC, see Integrated Marketing 501, 297, 322, 324, 326, 328,
Communication aspects of, 378–9, 504, 335, 348–9, 398, 502–5,
individualism, 318, 395, 403, 410, influence on, 371, 373, 375, 510, 551, 572–3;
412, 414–6, 424, 459, 465, 467 377, 379, 382, 384–5, premium, high-priced, 9;
606 Subject Index
retail, 10, 480; marketing myopia, 23–5; aspect of, 169;

rural, 27, 50; concept of, 23; brand, 174–5, 178, 423, 436;
specific, 6; signs of, 24 impact of, 177;
tea, 9, 70; marketing plan, 26, 454 individual, 170;
unorganized, 3, 9–10, 34, 70, marketing practice, 23, 25, 34, 371 theories on, 165,
97, 126, 228, 305, 374; marketing research, 73, 119, 163, Freudian theory, 165
urban, 5, 8–9, 11, 27, 36, 49, 179, 230, 233, 241, 317, 500, 505 point-of-purchase, 91, 101, 132,
60, 85, 118, 154, 257, 264–5, marketing strategy, 3, 8, 17, 23, 136, 145, 157, 160–61, 196, 208,
269, 271, 311, 332, 488, 521-2 55, 58, 66, 81, 156, 225, 302, 358, 230, 248, 293, 298, 300, 305–7,
marketing; barriers to, 5; 373, 385, 512; 309–13, 334, 384, 477–80, 482–9;
behavioural dimensions consumer behaviour and, kinds of, 487
of, 65; 78 POP, see point-of-purchase
brands, 17; market share, 9, 49, 51, 97, 103, positioning clarity, 49–50
business-to-business, 130, 115, 131, 133, 137, 205, 210, 224, possession, 173, 241, 246, 259,
344, 347, 352, 355; 359, 372, 425, 428, 461, 470, 499, 430, 432, 444, 548
concepts, 4–5, 227, 512, 525, 551, 563, 572 poverty, 5, 9
traditional, 5; materialism, 173, 318, 429, 453 powership, 359
context-based, 5; media, 8, 29, 51, 56–7, 62, 75–6, pre-sales service, 294
differential, 153, 349; 83, 94, 113, 122, 153–4, 156–7, price discounting, 32, 34
direct, 38, 69, 101, 107–9, 114, 163, 175, 184, 193, 197, 205, price off, 34
153, 184, 186–7, 257, 264–5, 217–20, 230, 232, 243, 257, 266, pricing, 4, 22, 27, 29, 46, 73, 92, 97,
299, 349, 358; 297, 313, 325, 330, 335, 349–50, 120–21, 145, 155, 169, 188, 216,
dynamic, 125; 375, 394, 437, 554; 225, 262, 335–6, 351, 356, 358,
experiential, 17–9, 44, 75, digital, 51, 56–7, 62, 122, 330; 364, 463, 525, 547;
332, 571, 576–8, 584, mass, 29, 51, 56, 153–4, 184, adaptation, 22;
concept of, 19; 325, 335, 349, 437; loyalty and, 155, 351;
four P’s, 25, proliferation of, 57; penetration, 97, 121, 169, 335;
see product, price, place and radio, 10, 118, 230, 550, 562 premium, 27, 73, 92, 188;
promotion; global, 17; MNC, see multinational skimming strategy of, 73
Ideal Point Model, 193; company, priming, 161
impact on, 199, 271; motivation, 51, 65, 69, 83, 116, product;
international, 5, 74; 150, 165, 193, 303, 315, 342–3, commoditization of, 46;
permission, 170; 387, 501 consumption, 35;
practitioners of, 23, 48, 371, MRP, see marked retail price customized, 122;
373–4, 436, 504; multinational company, 5, 50, 97, symbolism-orientated, 50,
product, price, place and 198, 200–02, 205–6, 254, 272, up-market, 114;
promotion, 25, 27, 471, 473; 451, 456, 469–70, 477 foreign, 169;
relationship, 267, 359, 371; multi utility vehicle, 119 hi-tech, 138–41, 215, 266;
retail outlet, 297; MUV, see multi utility vehicle impulsive, 114;
thought leadership in, 58; industrial, 138, 356, 359;
viral, 56; neo-mindset, 181, 402, 411–2, innovative, 20;
web-based, 322 414–6, 419–20 launch of, 8;
marketing decision, 65 neo mindset, 7;
marketing implication, 261, 342 new, 33, 37, 40, 57, 60, 82,
opinion leadership, 37, 55–8, 84,
marketing mix, 4–5, 11–3, 20, 22, 145, 158, 169, 172, 181,
93, 220, 241, 435;
25–9, 38, 49, 65–6, 69–71, 72–5, 184–5, 197, 213, 216–7,
influence of, 57
77–8, 89, 91–2, 95, 100, 102–3, 221–2, 224, 373, 398, 405,
opportunity, 69, 162, 193, 236, 574
107–9, 126–7, 131–2, 138, 161, 427, 438–9, 444;
170, 179, 200, 209, 216, 218, 225– new-concept, 81–4, 179, 187;
6, 245, 248, 259, 265, 338, 358, packaging, 10, 30, 86, 104, 106, placement, 7;
360, 363–7, 373, 426, 436, 451–2, 115, 118, 123, 140, 166, 183, 192, selection of, 65;
454–6, 458–61, 471, 512–3; 201–2, 236, 271, 273, 308, 366, substitutability of, 87
application of, 26; 373, 384, 403, 478, 486 timing of, 5, 7;
aspects of, 4, 132, 245, 259, penetration; low, 8–10, 21, 34, 38, trial of, 84, 313
365; 43, 60, 153, 227, 236, 326, 328; unknown, 228;
consumer behaviour and, 71; pricing, 97, 121, 169, 335 usage, 8, 100, 105, 151, 219,
formulation of, 29; personality, 43, 54, 58, 65, 67–70, 327, 332, 439, 444
importance of, 26, 71; 107, 116, 126–7, 129–30, 143–4, product decision, 73
kinds of, 360; 157, 165, 168, 169–78, 188, 242, product development, 10, 61,
prioritisation of, 73; 249, 318, 336, 341, 354, 369, 328
use of, 74; 376–7, 382, 405, 409, 423–4, product differentiation, 27, 71,
well-planned, 75 426–9, 431–8, 443, 453, 513, 571; 90, 333
Subject Index 607
product line, 48–50, 69–70, 72, 92, kinds of, 36, 122, 299; implications of, 356
98, 103, 132, 349; low, 251; stock-outs, 96, 303
extensive, 48; perceived, 34–6, 38, 57, 59, strategic brand concept, 125
management of, 48 86, 93, 95–6, 111, 122, 154, sub-branding, 39, 50
product puffery, 105 167, 215, 218, 220, 243, 251, supermarkets, 98, 101, 300, 301,
profit, 11, 32, 52, 55, 77, 153, 170, 292, 299–300, 343, 376, 454, 307, 317, 322, 324, 477–89
252, 304, 328, 349, 359, 360, 361, aspects of, 122, sustainable core proposition, 103,
362, 556 product category and, 35, 127, 132–3, 323;
prosperity, 3, 263, 408, 412–4, value-based, 35; brand associations and, 127
416; performance, 37, 122; SWOT, 200, 201
rural areas, 3 placement, 35; symbolism, 50, 54, 55, 62, 63, 121,
price-related, 35; 130, 138, 143, 146, 166, 167, 168,
redundancy, 162 psychological, 35; 178, 223, 237, 335, 341, 354, 355,
reference group, 58, 67–8, 173, social, 35, 299–300; 367, 371, 372, 373, 375, 376, 377,
213, 239–45, 249, 256, 258, 377, value, 36, 37 378, 379, 382, 383, 384, 385, 387,
384–5, 388; 388, 390, 432
kinds of, 239 sachets, 6, 10, 20, 22, 48, 65, 77,
reliability, 124, 140, 329, 341, 355, 114, 196, 224, 236, 261, 311, 488, telephone regulatory authority of
376, 382 573, 574; India, 547
research, 17, 20, 46, 52–3, 55, 57, low priced, 77 thinking process, 65
61–2, 72, 89–90, 102, 107, 114, SBC, see strategic brand concept timing, 5, 7–8, 20–21, 34, 36, 72,
119, 121, 131, 135, 137–8, 140– SCP, see sustainable core 154, 226, 268, 350;
41, 149, 152, 156, 160–63, 166–7, proposition importance of, 7;
170–72, 177–9, 181–4, 190–91, segmentation, 21–2, 61, 65, 126–7, marketing mix, 72
195, 203, 210, 217, 222–3, 225–6, 135, 217, 228, 346, 356, 361, 520, trialability, 215
228, 230–31, 233–4, 241–3, 245, 523, 548;
268–9, 292–3, 295–6, 299, 302–3, concept of, 61–3,
306, 308, 310, 314, 317, 319, 321, age-cycle, 61–3 uncertainty, 406, 411, 413, 414, 415
330, 332, 343, 345, 347–8, 352, self-concept, 52, 68, 167, 168, 169, unique selling proposition, 90, 94,
356, 362, 365, 369, 371–4, 376–9, 178, 375, 377, 384, 385, 545 117, 134–6, 142, 158–9, 166–7,
382, 388, 394, 404, 423–4, 427, self-congruity, 424 175, 200, 230, 342–3, 357
429, 434, 436, 452–4, 456–7, 464, self-expression, 177, 178, 424 unpredictability, 43
467, 477–8, 500–08, 512, 525; self-image, 44, 143, 168, 173, 175, upgradability, 139, 140
ANOVA, 400, 402, 417–21, 186, 242 USP, see unique selling
492; sensation, 45, 113–4, 192; proposition
application-based, 369; application of, 114; utilitarianism, 407, 412, 413, 414,
data analysis, 401; applications of, 113 415
implications of, 434; shopaholism, 108 utility, 50, 55, 95, 119–21, 143, 156,
importance of, 141, 374; shopping, 33, 106–8, 111, 138, 174, 186–7, 217, 228, 251, 452;
marketing, 506, 210, 219, 230, 257, 263, 268, 292– enhanced, 228; functional,
qualitative, 506, 6, 298–9, 301, 306, 308, 312–4, 59, 110, 121, 186–7, 224,
quantitative, 507; 317, 318–9, 323, 324, 477–9, 482, 341, 355, 393, 545
methodology, 377, 396, 427, 487, 578, 587;
453, 480, 577; ritual, 263; value-added services, 139, 554
primary, 292–3, 295; styles, 104, value addition, 28, 32, 128
sampling, 398–9, 428, 481, brand-conscious, 107,
577 fun/pleasure-oriented, 108,
retail equity, 52, 292, 305–7, 310, impulsive, 108, WOM, see word-of-mouth
313 loyalty, 109, word-of-mouth, 31, 36–8, 52,
retail image, 295 novelty-oriented, 107, 56–9, 79, 84, 86, 93, 100, 102,
retention, 53–4, 100, 159–60, 324, quality-oriented, 106, 111, 122, 136, 140, 146, 151–2,
351–2, 355, 357–9, 361–2 value for money, 108 167, 171, 173, 184–5, 188, 196,
risk, 34–8, 43, 57, 59, 86, 93, 95, 99, SKU, see stock-keeping units 206, 213, 216–7, 219–20, 223–4,
111, 122, 154, 163, 167, 215, 218, stimulation, 19, 170, 172, 301, 576 229, 233–5, 237, 240–41, 243–5,
220, 231, 243, 251, 292, 299–300, stock-keeping units, 97, 103, 196, 251, 293, 308, 310, 316, 318, 329,
343, 354, 361, 376, 454, 468; 295, 296, 298, 301, 303, 309, 311, 335, 337, 342–3, 348, 358, 387,
economic, 299; 313, 356 425, 456–7, 488

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Consumer Behaviour and Branding

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Chennai • Delhi • Chandigarh

Copyright © 2009 Dorling Kindersley (India) Pvt. Ltd.

Kevin Lane Keller

PART I CONCEPTS IN CONSUMER BEHAVIOUR 15

Chapter 2: The Importance of Consumer Behaviour Towards

Chapter 3: Consumer Decision Making and Branding Strategies 81

Chapter 4: The Concept of Perception and Its Impact

Chapter 5: Learning Principles and Their Usefulness to

Chapter 6: The Role of Motivation and Personality Dimensions

Chapter 7: Attitudes and Their Impact on Branding Strategies 179

Marketing Implications 180

Chapter 8: Diffusion of Innovation: The Acceptance of

Chapter 9: The Concept of Reference Groups and Their

Chapter 10: Dimensions of Culture and Branding 253

Chapter 11: Retailing and Consumer Behaviour

Touch of Reality 318

Chapter 12: The E-Mode of Brand Positioning: The Need for an

Chapter 13: Concepts of Customer Satisfaction, Loyalty

PART II READINGS 369

Reading 2: Cultural Values and Branding in an Emerging Market:

Reading 3: Linkages Between Brand Personality and Brand Loyalty:

Reading 4: Cultural Dimensions and MNC brands: A Study in

Reading 5: Research Dimensions on Point of Purchase 477

PART III CASES 517

Case 3: The Importance of Experiential Marketing in Marketing

The Indian market is referred to as an emerging market. The Indian academia

and markets” viewpoint and from the viewpoint of understanding individual

A special word of recognition is due to the following executives for provid-

 Personal computers 0.6%

A conceptual approach should be adopted to ﬁnd solutions to challenges

A number of children are employed as domestic help and child labour is

Importance of Cultural Dimensions

appliances, soft drinks, regional foods, chocolates, watches, paints, shaving

Challenges in Emerging Markets

The emerging market in India has distinctively different demographics and

 India has about 15 million retail outlets.

Beyond the glitz and glamour of advertising, several conceptual ap-

segments. Shampoos, apparel and entertainment electronics categories are

Challenges for Marketers

upmarket brands have gained visibility in urban markets (Nike, Adidas,

Options Available to Branded Offerings

The Indian experience

Linkages Between Concepts and

The Experiential Approach to Branding

What is experiential marketing ?

be instances where consumers would like negative emotional experience, with

Table 1.1  Experiential Marketing

Physical consumption Physiological experience

Applying the concept of experiential marketing

Consumers and Contextual Creativity

offering, positioning plays an important role in defining the context in which

Timing of contextual creativity

Importance of situation as a segmentation base

(In segmentation (marketing mix elements included), each segment requires

Creativity with other elements of the marketing mix

Marketing Myopia as a Classic Strategy

The need for brands to be customer-centric

The focus of experience-based branding efforts

Consumer Perception and Marketing Strategies

The synergistic approach to branding

Behavioural aspects associated with consumers and

Companies in the cellular phone market would do well to provide specific

S. Ramesh Kumar - Consumer Behaviour & Branding Concepts Readings & Cases-Pearson Education (2014)

S. Ramesh Kumar - Consumer Behaviour & Branding Concepts Readings & Cases-Pearson Education (2014)