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What drives brands to up the ante on ads?

By Viveat Susan Pinto
May 22, 2017 17:52 IST
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Is it a last ditch attempt to reassure consumers, or a way to gain the upper hand at the negotiating table, or is it just a way of exhausting the treasure chest before the lights go out

The billboards are unmissable on the Western Express Highway, a road that runs right through the western suburbs of Mumbai. The name of Kenstar, a brand of home appliances owned by Videocon Industries, is clearly visible. The visuals and accompanying text convey the simple message: Kenstar is a good bet this summer.

For a brand that has been battling intense speculation of late of being put on the block, this is a valiant attempt, say experts, at indicating that all is normal on the business front. The company, on the other hand, is dismissive of such talk.

Kenstar’s chief operating officer (COO) Rajiv Kenue is blunt when squashing the rumours saying, “We are a brand that came into existence in 1996 and we have positioned ourselves as one which is affordable and aspirational. We have no intention of giving this up. In categories such as air coolers, we have a strong presence and it is a segment we continue to invest,” he says.

In recent years, Kenstar has extended its presence into categories such as water heaters, microwave ovens, mixer-grinders and a host of other kitchen and home appliances such as air conditioners, fryers, juicers, fans and irons.

Kenue, a consumer goods veteran, who has worked in organisations such as Samsung, LG and Videocon, says that entry into more categories within kitchen and home appliances is on the cards.

“In a cluttered market, where there are so many brands, local and international, vying for attention, it becomes important for us to position ourselves as ones that offer superior value. Our campaign this summer is all about this,” he says. A distribution and retail push has also been initiated this summer to increase sales, he says.

Clearly for Kenstar, the advertising blitzkrieg is a way of getting rid of the ‘sell’ target affixed to it, at least from the consumers’ line of sight. It isn’t the only one in consumer durables that has fought such rumours in recent months.

Until the announcement of its acquisition in February this year by Havells, Lloyd Consumer, which makes the Lloyd brand of air conditioners, washing machines and refrigerators, continued advertising heavily on television using actress Shruti Haasan as its face. For Lloyd, the objective was to ensure the brand remained top-of-mind in a competitive market.

Lloyd ranks number three in the domestic air conditioner market after Voltas and LG, Lloyd Consumer executives said. And it was only with constant brand-building and marketing, that consumers could be made aware of what Brand Lloyd stood for, they said.

That rivals were interested in buying the brand was incidental, they add. Of course, experts point out such aggressive positioning in the media goes a long way in boosting the brand’s purchase value and attracting more bidders.

Just how aggressive Lloyd was in marketing its products can be gauged from this: Besides a national-level brand endorser in Haasan, the brand had state-level endorsers too in actors Mohanlal and Mahesh Babu for crucial markets such as Kerala and Andhra Pradesh respectively.

Further, markets such as Karnataka and Tamil Nadu were leveraged using sports as a hook. The Indian Premier League team of Royal Challengers Bangalore was used in the Karnataka market and the Indian Super League team of Chennaiyin Football Club was leveraged in Tamil Nadu.

To grab maximum eyeballs, Haasan and Royal Challengers team-members Virat Kohli, Chris Gayle and AB de Villiers were featured in an ad campaign together last year. Haasan was shown drooling over the brand, best known for its ACs, even as Gayle mistakes her interest to be in him.

This campaign clicked with young consumers, helping Lloyd consolidate its presence and appeal to a younger demographic, sector experts said. Notably, at the time of the acquisition, Havell’s chairman Anil Rai Gupta said that Lloyd would continue to be visible on television to ensure there was no disconnect with consumers.

Clearly consistent brand-building efforts had paid off with Havells acquiring Lloyd Consumer at an enterprise value of Rs 1,600 crore (Rs 16 billion), which is equal to its full-year revenue for financial year 2016-17. (For the nine months ended December 2016, Lloyd Consumer’s turnover was Rs 1,200 crore, which on an annualised basis works out to Rs 1,600 crore, sector experts said.)

“It is in the interest of Havells to keep visibility going,” said Abneesh Roy, senior vice-president, research, institutional equities, Edelweiss. “It will ensure sales, helping Lloyd hold on to market share in a competitive market,” he added.

While Lloyd’s big push in brand building seems to have given it greater confidence and leverage under a new owner, the jury is still out on whether this will be the case with beleagured e-commerce major Snapdeal, now that archrival Flipkart is close to acquiring it. Snapdeal has been loud and prolific with its advertising even as talks of an imminent merger became apparent in the last six to eight months.

Snapdeal undertook a high-decibel brand makeover, which involved positioning the e-commerce major as a marketplace perceptive of the needs of its consumers.

‘Unbox Zindagi’ or Unbox Life as the new brand identity of Snapdeal went, conceptualised and executed by adman Prasoon Joshi and his team at McCann, was billed as one of the most visible ad campaigns ahead of the festive season last year.

According to television measurement agency Broadcast Audience Research Council, it was the third most visible brand on television after Patanjali and Hindustan Unilever’s Lakme in September 2016.

What drives brands to go all out with their advertising even when the end seems imminent? A last ditch attempt to reassure consumers, or a way to gain the upper hand at the negotiating table, or is it just a way of exhausting the treasure chest before the lights go out. While the answer is elusive, consumers would do well to judge a brand by its actions, not words.

Photograph: PTI Photo

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Viveat Susan Pinto in Mumbai
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