Product failure

Business market is highly competitive, it is very important for company to develop new product at regular intervals because customer constantly wants something new. It is not necessary that whole product is new to the market, the new product can be new in terms of packaging, new flavour or modification in the exciting product. New products involve lot of risk for the company that is risk of failure of product. Company invests lot of money in research, designing, production, commercialization of product. If product fails then it is big loss to company in terms of finance and in terms of time. It has been experienced that consumers buy only those products, which they have trusted . However, then at times there is gap and a product fails.

Why product fails in market? Well reasons are different for different products. One of the reasons of product failure is faulty idea for e.g. in case of “COOL CATS” - fans from polar industries. These new fans from company were decorated with cartoon character meant primarily to attract children. Price was kept high. Huge advertisement was done for promotion, but product failed. Because when the fan was put on, it did not have any colour effect and so its price was not justified. Another reason of product failure is improper positioning- Positioning means putting the product into predetermined orbit. However, Tanishq- a jewellery brand by titan failed in this. When company introduced its 18-carat jewellery and the product was positioned at elite class, there was contradiction. In Indi,a norms for gold at that time was 22 carat so, why this elite segment should go for low carat gold, so product failed miserably.

According to market sources, 95% of products fail due to inability to communicate them. Communication is costly business, companies have to spend huge amount to reach to consumer. Even after reaching to consumer its effectiveness cannot be guaranteed. Product also fails when company has no plan related to distribution strategy. How the product will reach to consumer? Which network will be used? How much distribution cost to company? This was the case with Nestle they launched new chocolate, which is meant to store in refrigerator. Large number of retailers did not have this facility so company has to suffer losses.

Size of market is another big criteria, faulty selection increase complexity. The bigger the market the more complex is to handle. In a smaller market it is much easy to penetrate and to prove itself. For e.g. if MNC has decided to enter India, then they should clearly define which part of India they want to cater to. Faulty Packaging also results into product failure. Product benefits should be clearly mentioned of packaging which influence consumer buying. Quality of packaging should be taken care of. Apart from all the above mentioned reasons product can also fail due to no justifiable pricing even cannibalization result into product failure. One of the solutions to increase the cycle time of new product is testing the product prior to its launch. Thereby a well designed test market reduces the risk of launching a flop product.

However, in the times of Confidence Crisis, every successful company is investing lot in new product development. During these times, cost of input factors are less and all companies want to leverage the opportunity. In order to increase the brand awareness and brand loyalty companies come up with new products or variants at frequent intervals but the reasons mentioned above if ignored can be costly affair to the company.

Packaging : A branding concept

Why there is a need for branding? Branding is used for Distinctiveness so that customers can easily differentiate your product with the competitor’s. It is also used for identification so that customers associate intangible and tangible qualities with your brand. The concept of branding is also useful because of reassurance to customers that our product or service is of high and consistent quality and more importantly, it is used to focus all our energy towards advertising.

Branding is so important concept now a days that an apple with a tag of OK TESTED sells at higher price than the non-branded apples. The primary reason for branding is to compete in the real environment. It reminds customers that our product is different from others.

Take an example of Mineral water industry in India. There are some important brands like Bisleri, Kingfisher, Kinley, Neer, Himalayan etc. Most of the bottle covers have blue colour on its bottle to link with the visual association with that of water. But Himalayan kept Pink as a bottle colour, it is so predominant that from 20 feet one can identify that the mineral water bottle kept on a shelf with pink colour is of Himalayan. This is what the concept of branding is.

The role of packaging in managing and extending brand is a key one. Most marketers believe that it is only graphics that contribute to the branding but packaging and design also plays an equally important role in establishing the brands. Take an example of Pringles Chips. The Pringle chips comes in the shape of the box in which they are kept and all chips are of same size and dimensions that is what it makes stand out from its competitors.

As continued with the example of Mineral water packaging, In a highly competitive environment where customers are not loyal towards any brand. Whatever brand of water the shop keeper sells, people normally buys it. In such a case Kinley has taken the advantage by introducing a new shaped water bottle which is easy to grab and that shoots up the sale of the Kinley.

Packaging is very powerful concept that can be effectively used to stand out the product from the rest of the category products. Take the case of Deodorant Bottles, almost all the bottles look alike with same size, height etc. None of them is radically different, so it is just the physical attributes of the product that would help manufacturer to sell its products.

But Instant reaction is like a double ended sword, if the product is not successful and the customers are readily able to recognize your brand then the chances of revamping your product is very minimum. So marketer has to be very conscious in aligning the product characteristics with that of the design of the package.

VALENTINE'S DAY –Business Day

Marketers are always awake to find out business opportunity in scrap also. So how can they leave big business like Valentine’s Day? They know customers will spend huge amount in buying gifts, in getting special beauty treatment to look attractive on this day etc. So they start preparing for this in advance and try their best to deliver best. Whole week from 6th Feb. to 14th Feb. is celebrated as Valentine’s Day week. Gift shops, cards shops, flower shops, restaurants, all are decorated with love theme. E-mails, mobile inbox are filled with messages about arrival of special Valentine collection within stores.

Valentine’s Day is the time to express your love to your loved ones. This time of year is favourite time for the florists as flower is the best way to express your feeling .Therefore florists charge premium for the flowers, customers are also ready to pay that easily. According to sources last year around 103 million flowers were sold in the U.S during the week leading to Valentine’s Day.

The hottest selling flower is the red rose. High demand of red roses put pressure on wholesalers also therefore retailer increase prices of roses to meet the demand.

``In general, Valentine's Day is probably 30 times the normal business day,'' said Kristy Eidam, consumer marketing manager. Valentine’s Day is a big business. This day is like a gold mine for restaurants, florists, candy makers, balloon stores and for e- retailers. Majority of business comes from gifts and flowers.

Restaurants owners also enjoy good business on this day. Prior reservation is made to get space. Theme based parties is organized in clubs. Jewellery sales goes up tremendously on this day.

Valentine day is a big business for luxury brands too. Big brands like Gucci, Versace, christen Dior, Ck comes up with their special valentine collection. These brands see jump of 10-12% in sales during this period. Traditional gifts are one side, but when it comes to gifting something different exclusive and different then money does not comes into picture.

Then it It could be a Leiber ring purse for $1,895, an IK rose flower dipped in gold for Rs 1, 300 or a romantic spa package at Galaxy Hotel for Rs 12,500. According to the US’

National Retail Federation (NRF), Americans plan to spend a staggering $17.02 billion this year on Valentine’s Day. Jim Trippon, an authority on the money habits of self-made millionaires in the US says that this year’s day of love will cost the average consumer $1,300. Closer home, the numbers are equally impressive. According to the Retailers’ Association of India (RAI), the total spent on Valentine’s Day gifts last year was about Rs 12 billion ($270 million). Out of this about 30% of the total spend, Rs 360 crore, is estimated to have been spent on jewellery of various kinds.

The tradition is not new, In 1891, an Indian prince sent his beloved in London, a Valentine card set in carved ivory surrounded by diamonds. It cost him £250,000. So the time has changed but the way to show love has been same but more marketed.

Fastrack Watches

FASTRACK Watches


Titan entered into youth segment watches market with its sub brand christened as Fastrack in 1998. The Company has changed the utility of watches in India from a time device to fashion accessory. The launch of fastrack was to bring stylish, trendy and affordable watches for young generation. It hit the market with campaign `Cool Watches' from Titan’. Initially it came up with steel look targeting age group of 22-30 years. Next year the age bracket was reduced further to 15-25 years. Then Digital collection was launched which was marketed as `Too Sexy for Your Wrist'. After this fashion, collection was launched to attract more female audience. For this communication was “Are You on It?’ With the new launch, company comes up new communication mix to appeal to its target audience. This strategy was adopted by company to lure new customers towards brand.


Initial two–three years the brand fastrack had shown positive growth. But in 2002-2003 the growth was stagnant, price was a major concern as brand was targeting youth and they don’t have so much disposable income to buy watches in the price segment fastrack was catering to. That time company decided to target executive class, which was a big disaster as watches didn’t possess executive looks. Therefore, in 2005 company re-launched campaign to capture market. This was done as to rebuild brand image that was diluted with the various experiments done previously by the company. At that time Fastrack was marketed as India’s first youth oriented watch brand.


Previously when titan fastrack was launched it was targeted to youth but in 2004 when company launched sunglasses their focus was diverted and fastrack’s revenue declined. Then fastrack came into new “AVTAR”, (a new model) in which looks and style were given more importance instead of material used in the watch. In their re-launch, price bracket was reduced to Rs 500 – Rs 2000. Huge expenditure was spent on advertising of brand promoting to youth. For brand building fastrack sponsored many college festivals. This helped company in gaining popularity in youth. It also carried out co-branding exercise with youth brand MTV. The new logo and new watches truly presented picture of younger avatr of fastrack.

Recently company came with the campaign The ‘How Many You Have’ this was aimed to target youth nature of seeking constant change, wants more. Then in 2008 company came up with campaign ‘Shut up and Move on’ which appealed to youngsters of not staying committed towards one thing but ready to explore. These campaigns showed how the youth segment is clearly targeted through these advertisements. In this way, company is able to do proper communication to its target audience.

Youth market size of watches makes up to 70% in total of all segments. Therefore, Fastrack is always in the process of bringing something new, stylish and innovative in its segment .In January 2009 it came up with new Army Collection. Iin this segment 20 different styles are launched by company inspired by the grenade, tanks, the sniper etc depicting truly Army image. The company correctly uses its communication mix( use of TV, blogs and outdoor media) to appeal to its target base. By making its watches more affordable, it has proved its corrective implementation of marketing mix.

Haldiram

Haldiram has been rightly termed as Taste of Tradition. Known for its unbeatable taste in Mithais and Namkeen segment, Haldiram is an household name now. It was in year 1937 in Bikaner, when Ganga Bishen started selling Bhujia sev in Bikaner and it became so popular within city that even tourist coming to the city prefer to buy it. Then in 1941, the name 'Haldiram's Bhujiawala' was used for the first time. Then after they expanded business in Kolkata followed by another unit in Nagpur, and in 1983 first retail outlet was opened in Delhi.

Haldiram has grown both in domestic and international market. Today Haldiram is known for matchless quality, packaging, efficient supply chain management, distribution network and zero impurity. Company uses best technology for its all manufacturing units and special attention is given to packaging due to which shelf life of namkeen has been increased to six months. The Aggarwals family that owned Haldiram group always paid attention to need of customers in order to expand. For this the company offers wide range of variety catering to needs of different age group.

In early nineties, there was conflict within the group and they had to split. Prabhu shankar who was handling Kolkata unit filed complaint against Delhi and Nagpur units, alleging breach of contract when sweet shop was opened in Delhi in 1991. Final judgment came from court in 1999 leading to formal split into group leading to three different companies with specific territories. However, boundaries remains on paper, each company tries to penetrate into others region and competitors take advantage of the same.

In the early 1990s, because of the conflict within the Aggarwals family, Haldiram's witnessed an informal split between its three units as they started operating separately offering similar products and sharing the same brand name. In 1999, after a court verdict these units started operating as three different companies with clearly defined territories. This split had resulted in aggressive competition among themselves for a higher share of domestic and international markets.

Haldiram product range from namekeen, sweets, sharbat, dairy product, ice cream, snacks, dairy and bakery products, from this highest contribution comes from namkeen. Company’s Nagpur unit alone manufactures 51 varieties of namkeen, Delhi 25 and Kolkata 37. Company varied product tastes according to preference of customers residing in different parts of the country.

Haldiram group has well managed distribution network, which has its reach for its products in country as well as other parts of world. Carrying forward (CFs) agents of company collect goods from manufacturing unit who pass them to distributors, who in turn send them to retail outlets. Haldiram has entered into e-retailing also, they have tied up with indiatimes to sell their products. This clearly shows that the company that has its roots in traditional India is innovating with time and this is what a successful company does. Innovation and marketing is a key to success for Haldirams. Few of the examples of innovation strategies adopted by Haldirams’ is the use of mineral water in the preparation of pani puri and chat papri to attract customers who are very conscious about the hygiene of the Namkeens and Snacks sold in the country. At one point of time Haldiram had tied up with irctc to sell evening snacks in Rajdhani and Shatabadi express.

Haldirams has very well understood the intensity of competition in this highly diversified market so they have tied up with Profile Advertising, which designs attractive posters, brochures to facilitate the brand. Visual merchandising of showroom and retail outlet is enhanced by displaying products on special racks. Through these strategies, Haldiram is posing a tough fight to its competitors which include not only Agarwals, Nathus and Bikanerwala, and but also to Pizza chains like Pizza hut, Mc Donald’s

Secondary Brand Associations

Primary Association
Before I start on secondary associations, it makes sense that I talk about what the primary associations of a brand are. Primary associations are qualities/equity inherently possessed by the brand. These would include those of salience/utility (whether a washing powder cleans clothes or whether fairness cream makes you fair), performance (does the washing powder tackle tough stains well, whether the fairness cream makes you 5 shades or 2 shades fairer), imagery (how reputed the brand is, how successful has it been), judgment (how the brand fairs in comparison to competitors), etc.

Secondary Association
Secondary association on the other hand is more of a branding-marketing function. It transfers the qualities/equity of other entities to the brand in question. Consider a commodity like salt. One can argue that iodized salt is iodized salt and while one can double filter it and another triple filter it, the two salts cannot be too different. But when one of them is Tata Salt and the other Dandi Namak one would tend to think of the former as of better quality. This is a classic case of the secondary association: Tata’s reputation of quality being transferred to the salt.

Leveraging Secondary Associations
The above example was one of the many ways one can build secondary associations – through the parent company. However there are many other ways of doing the same. Some of these are illustrated below:

Other Brands
Co-Brands: is used extensively by credit cards. Consider a Standard Chartered card that is co-branded with Shopper’s Stop. It would indicate that the card is oriented towards the frequent shopper who could avail discounts at Shopper’s Stop outlets using the card. An ABN Amro – MakeMyTrip.com card on the other hand would be one for frequent fliers and enable one to stock points for each flight booked using this card. As for equity transfer, a StanC-Shopper’s Stop co-branded card would work differently when compared to a StanC-Big Bazaar one – the previous would transfer sophistication to the card while the later would transfer qualities related to cost effectiveness and value-for-money.

Company: Tata Salt is an example of this

Ingredients: Take Sona-Chandi Chyavanprash. Gold and silver, being expensive and noble metals, lend their ‘sheen’ to the chyavanprash making it seem better in quality than, say, a Dabur Chyavanprash.

Extensions: Again used extensively. Consider when Cadbury wanted to make a smaller and lighter version of its chocolate snack, Perk. Instead of giving the product a new name it called is Perk Slim. Not only has this logic resulted in Perk XL and Perk XXL, but when Cadbury came up with a new ‘reverse Perk’, i.e. a snack which is a wafer on the outside and chocolate inside they named it ‘Ulta Perk’! The idea obviously was that the brand equity created by Perk be leveraged in all these new products

People
Employees: Examples are few of this kind of secondary association because the consumer rarely comes into contact will the employees of the company behind the brand in question. But there are some where the interface with employees is significant. Consider airlines. Do friendlier ground handling staff and prettier air-hostesses affect your impression of an airline? I bet they do J. Similarly a bank where employees seem ill-dressed and ill-at-ease will seem much more inefficient than one where the employees are smartly dressed and prompt.

Endorsers: Belmonte, a little known clothing brand, gets endorsed by Shah Rukh Khan and immediately starts selling more. Why? Because Shah Rukh Khan had a relevant equity (his style statement) to lend to the brand. I am unsure if someone like, say, Govinda, would have worked as well.

Places
Country of Origin: Swiss Chocolates, French Wines, Indian Basmati… need I say more? What inspires greater confidence – a Japanese electronic good or one that is China-made? Besides being known for quality products countries often are known for more subtle qualities – like German engineering and Italian design.

Channel: Where you sell what you sell makes a difference too. Consider Louis Vuitton. They are available in Ambience Mall in NCR, UB City in Bangalore, Hotel Taj Mahal Palace & Tower in Mumbai – the exclusivity of each of these places adds to that of the brand.

Things
Events: Manickchand sponsored the Filmfare awards for a long time. This association with an event that served as the spectacle of India’s glamourous and high-fliers enabled Manickchand to later claim to be catering to a high class – ‘Unche Log, Unchi Pasand’

Causes: Sponsorship of events of serves as a strong secondary association too. Toyota sponsored NDTV’s Greenathon, with and aim of imbibing the qualities of being environment-conscious from the event.

Parting Note
When building a secondary association, one should be aware of the relevance of the equity sought for the brand. For example ‘German technology se bana Binani Cement’ makes sense because Germany is known for its superior engineering strength, ‘German main bana ABCD Chai’ makes no sense.
Further equity when lent to a brand should reinforce and augment the parent brand. For example if Tata Salt turns out to be non-refined and foul, it will not just damage the salt brand but also the name of Tata. A recent example is of how the Satyam scandal has hit the reputation of India Inc. as a whole by virtue of association.
Ultimately the aim would be that while initially a brand leverages on secondary associations, it should eventually be in a position where it is not just a good brand in its own right, but also lends positive associations back to the source of its secondary association.

Mumbai Dabbawalas

Can you guess the company that has never gone on strike since last 116 years, this is a company where the whole work force is illiterate but they lecture MBA students of Stanford, IIM A and likes. It is ISO 2000 certified company with six-sigma in process. Prince Charles invites them for his marriage; Richard Branson visits them when he comes to India. I am sure by now you must have guessed it rightly; I am talking about Mumbai Dabbawalas (MDs).

Mumbai Dabbawalas is India’s one of the Top Brands. It is one of the trusted brands in India. Even the companies like Microsoft and Airtel associated with Mumbai Dabbawalas. Microsoft partnered with them to promote their new Windows package to the target segment. Even Airtel collaborated with them to distribute new schemes, prepaid connections.

The Dabbawalas brand is a synonymous with trust and commitment that is why now the companies like Reliance Power has collaborated with them to distribute the forms for their IPO. The important thing is that MDs never launched any marketing or per say branding programme.  It is just their service that brought them the brand value.

Recently MDs have launched a website to showcase their work and their achievements. It is surprising to find that they have included tabs like jobs@MDs, their lectures with various MBA colleges. They have started taking orders online now and a text messaging order taking system that enables them to bag orders real time instead of depending on secondary sources like references or word-of-mouth. It’s a major driver as establishing a Web-based and mobile phone ordering system was the need for a central ordering facility where one can call for a Dabbawala's service by just hitting the Web site or through an SMS. Since they introduced the SMS-based ordering service they have been getting about 5500 new orders every year.

Now they have adopted another marketing strategy of merchandising the things that are directly associated with them like Gandhi Cap, Iconic Dabba etc. They have very well sustained the labour intensive model of business but without incorporating technology in such an era would be challenging for them