The Anchor: Abraham Alapatt on 5 Ways a Brand survives with intense competition

09 Apr,2012

By Abraham Alapatt

 

1. Relevance:

As a category gets crowded and differentiation gets blurred, the biggest challenge for a brand to survive both with existing customers (survival) and to appeal to prospects (growth) is to become and stay relevant to the customer’s life and lifestyle. Unless a brand can stay relevant enough for customers (existing and prospective) they are in serious danger of losing mind share – and therefore eventually, wallet share.

 

Category relevance may be relatively easier in some categories that are frequently used/discussed – cars, mobile phones/providers, FMCG and personal care products, fashion and lifestyle  and so on, because category relevance is a given. The challenge for brands in these categories is to remain constantly relevant to the customer’s evolving needs and aspirations in these categories where competitors are constantly changing the boundaries of relevance either at product/service/technology level or at a brand/imagery/status level.

 

On the other hand, brands operating in relatively less “involved” categories like furniture, cement, insurance and others – need to constantly find ways to “create” category relevance and then brand relevance to stay relevant within the category. They usually attempt to do this with innovations, service +1s, etc.

 

2. Personalization:

Again, as categories (and brands within them) grow exponentially, “impersonalization” in product/service/process begins to become the norm – to handle the growing number of customers and resultant demands.

 

Successful brands (especially in service categories) use this opportunity (provided by current market leaders being “impersonal”) to target a growing set of customers and prospects who are disgruntled with this and who demand/seek a higher degree of personalization or customization, by tapping into their innate need for recognition and acknowledgement.

 

Customers (especially the more educated/affluent) increasingly demand to be “recognized” as individuals/names and not merely by a number/ID. Brands in the service space that manage to balance the need for this personalization with the added economic price that this entails are able to not just retain their existing customers, but actually grow their business because they do this effectively. Banks, especially the private-foreign banks and airlines demonstrate this well, using highly developed HNW programs with exclusive personalization privileges to their most valuable customers.

 

3. Relationships:

In tough times, the power of relationships to sustain and grow business cannot be overstated. The most powerful marketing brands, actually invest more heavily in building customer/prospects relationships during slow/recessionary periods as they see the very tangible benefits of this intangible asset.  So whether it’s an Apple (that grew/grows exponentially even when their peers like RIM/Blackberry are going out of business) or an Indigo Airlines that breaks even and declares record profits while the aviation industry is reeling from its worst years in recent history – there are enough examples to suggest that powerful brand-customer relationships can see brands through the toughest competitive phases.

 

4. Transparency & fairness:

Across the world, one of the most frequently used attributes used by loyal customers of their favourite brand and (alternately, one of the most often heard causes for customers to reject/move away from their existing brand) is transparency/fairness of dealings or their absence.

 

Customers expect a fair and transparent relationship with their brands. So from the advertising to the salesperson’s pitch, from the showroom experience to the call centre response, from the application form to the statement/bill, from the welcome letter to the post sales complaint/service handling – brands that want to survive a hostile competitive environment, need to ensure that their processes are simple, easy to understand/use and their technology platform capable and robust enough to ensure error free billing/service and so on.

 

Banks like HDFC inIndiahave demonstrated that fair, understated and transparent efficiency work with customers as well (if not better) than some of their peer banks that are a lot bigger, flashier and more aggressive.

 

5. Consistency of service quality:

Seemingly the most obvious, but sadly often the most overlooked. The mobile network that is often down/out of range, the bank ATM that is down often, the mutual fund that delivers consistently below the benchmark index/market, the car that breaks down often – these are often the most likely causes for customers to move away from their existing brands – especially when competition is tough and enticing them with juicy deals.

 

Poor or inconsistent service obviously does little to retain customers during these testing times. Brands that want to survive and even grow during tough competitive times, would do well to review their basic product/service delivery quality and consistency to ensure it is on par if not better than peers – or run the risk of losing their customers much faster and easier than they gained them.

 

Abraham Alapatt is Senior Vice President & Head – Brand & Corporate Communication at Future Generali India Life Insurance Company & Future Generali India Insurance Company

 

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