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Our Bureau

Chennai , Feb. 17

THOUGH great advertising has built brands, advertising is not always the starting point in connecting with the customer, according to Dr Erich Joachimsthaler, CEO, Vivaldi Partners.

Delivering the keynote address at the inauguration of the two-day Brand Summit organised by the Confederation of Indian Industry (CII) here today, Dr Joachimsthaler said that there were many new ways in which brands could connect with the consumer and that there has been a big change in brand management and brand-consumer connect.The classic approach to brand building is long past its prime, Dr Joachimsthaler said. It no longer fits the requirements of the market. For instance, in India, marketers will have to plan how to differentiate between rural and urban markets.

Citing the example of Harley Davidson, Dr Joachimsthaler said that the brand did not quite measure up to competition in terms of quality but the power of personality built around the bike (which included politically incorrect slogans) saw an increase in the number of women buying the bike 2004.

India, he said, has the second largest number of brands in the world. Low-priced products contribute to the majority of sales and the middle- and lower-income groups account for 60 per cent of the sales. The country would also soon witness battles among MNC brands, he added.

Talking about how branding made a difference to the telecommunications company Orange and its competitor One2One, he said that in 1994, both the companies set out with a similar client base. Orange built its brand over the next five years and sold out to Mannesmann for $45 billion — at $8,100 per customer. Around the same time, One2One also sold out to Deutsche Telekom for $10.5 billion or $3,690 per customer.

Dr Joachimsthaler said that companies would also have to look differently at how to do their market research. He outlined three principles that brand managers could follow in their brand building efforts. Brand managers, he said, will have to deeply understand the customer; second, they should interact with customers in their daily lives and thirdly, develop strategies to capture more share of the consumer's life.

Delivering the theme address, Mr N. Murali, Chairman, Brand Summit 2005 and Joint Managing Director, The Hindu, said that during the last few years there has been a change in the economic landscape with more intense competition, especially in the wake of increasing globalisation.

This has resulted in a closer integration of India's economy with those of other countries. The fast changing economic environment has led to a changing "brandscape" as well, he said. Brands have not only transcended geographies but brand building has also become more institutionalised; there is more brand aggression in the market place as well, Mr Murali said.

With brand becoming an important part of everyday life, defining a meaningful role for the brand in the consumer's life becomes paramount. The increasing clutter in the marketplace and the changing consumer dynamics have thrown up a new set of challenges for marketers- of acquiring, retaining, sustaining the relationship with the consumer, in other words connecting with the consumer.

Mr Murali said that the consumer is at the heart of all brand management. The focus of the Brand Summit is to understand these far-reaching changes and devise strategies to reorient brand management for the new environment.

This edition of the Brand Summit, the third, comes after a gap of five years. Mr Murali said that the concept of a major convention in India on brand and brand management had its origins in Chennai in 1997 when the CII, Southern Region mounted its first edition of the Brand Summit.

He said that this was at a time when brand management practices in India had not reached the levels it is at today.

So, the objective of the first summit was to promote the concept of brand building. The second edition in 1999 built on these learnings and took the concept forward, Mr Murali said.

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