Brand Loyalty – A Diminishing Phenomena?


By
A M Sakkthivel
Faculty-Marketing Area, Department of Management Studies
Tech Park
PES Institute of Technology,
Bangalore–560 085
Phone : 91-98452 25561
E-mail :
sakkthi@yahoo.co.uk
 


Arrival of Value For Money products

The recent invasion of value for money (VFM) products has been creating a tremendous change in the way the market was before. Thanks to Chinese (Crouching Dragon…)

Products, hit the Indian market with all power to muster. It resulted the death of many small time players and led to series of serious of changes in the market structure. The recent phenomena of job cuts, voluntary retirement schemes, ever falling interest rates on deposits made people scurry for covers to earn for livelihood. The shrinking of disposable income had a phenomenal impact on the buying power of people, especially consumer durable.

Mulchandani's way

The raise and fall of 'Kabir Mulchandani' have had a vital imprint in Indian consumer durable market. The 'Mulchandani syndrome' have changed the total rules of the game and left all major players to follow his footprint. Definitely, it brought a bonanza to Indian consumers who long affected and deceived with inferior quality products at abnormal price. Albeit, presently, Mulchandani is out of the game, the other Indian players solemnly follow the footprint he left. To add insult to injury, the recent invasion of Korean FMCE & White goods majors in the Indian soil further changed the structure of the Indian market. Now, the Korean companies lead the Indian FMCE and white goods and old minnows are slowly vanishing from the marketing map and many of them already did.

Brand Loyalty – a fact lift!

The micro focus on the things happened; many hidden truths would come out. Firstly, the Indian consumers did not get liberty to choose their likings; secondly, they were deceived and frustrated by the available inferior goods and ended up paying premium, the money could have saved and could have spent well, Finally, when the market opened for outsiders, the local 'maharajas' got hit and could not revamp their products to woo their long deceived consumers. The forced brand loyalty, which created through lack of competition, would not work any more. Take example, Sony, a brand is synonyms to quality. But, when the market share of Sony is very meager as compared to its Indian and Korean rivals. Take another instance, TATA is a household brand in Indian soil, could not induce people to buy 'INDICA' car which faced initial set back resulted the TATA Motors ended up with a huge loss of around Rs.500 crore and now, its revamped model is taking place in garages of the target group. The morale learned from the above mentioned examples are that consumers would not buy brands blind fold. They would evaluate the brands through their performance, such as to satisfy the expectations of users.

Brand is a living thing!

The companies tend to forget the fact that brands are like human beings. They create perceptual filter in the minds of potential users as they hear the brands that would create an enormous impact on their buying decision. Brand is an acronym.
 

Fig 1 Dimension of a Brand


Build: The first character 'B' focuses on the building of trust among the target group on products/services they intend to buy. This is the preliminary step towards accessing to the perceptual filter. For instance, a consumer hears the brand of 'Sony', she might think the equivalent of quality and that could well be extended to other products of 'Sony' product bouquet. This could have happened due to the experience gained by the consumer through consuming any of products from 'Sony' product bouquet.

Reliability: The letter 'R' stands for the reliability of a product/service to be entrusted on the target group. Consumers ought to rely on the product/service would satisfy their needs/wants for they buy. Reliability is the key factor that modifies consumers' opinion towards any product/service. For instance, a consumer who intends to have 'Airtel' cellular subscription should have relied on the services offered by 'Airtel'. Once, if it faded, she would shift to another substitute and definitely ought not develop apprehension of cellular technology. Yet, she would have apprehension about new services offered by 'Airtel'. It vividly shows the flaw of one service would carry forward to the other services offered by the same company, need not necessary the other services also have flaws. Hence, the reliability is the vital factor, which acts a catalyst towards the buying behavior of consumers

Attitude: Attitude is yet another factor, which has a great impact on perceptual filter of consumers, would result the outcomes of their buying decision. Consumers tend to develop attitude towards products/services, rather we call brands, either positive or negative. This attitude is the crucial factor that would definitely facilitate or hamper the buying decision. The attitude development could well happen through hearsay or eavesdropping or hearing experience of others or gather information or also the first hand experience gained through consuming any product/service from the product/service bouquet of the company

Name: It is very important that name of a product/service plays an anchor in inducing perception filter of consumers. What is in the name? A million dollar question lingers in everyone's mind. Name is everything. When 'Nirma' launched the toilet soap in the same name, the consumers could not accept for a while and forced the company to change its name to 'Nima' to modify the perception of the consumers as the name embedded the thought of detergent soap in top of the minds of consumers. How would consumers respond if 'Mortein' launches Pizza under the same name? How would consumers react if Hindustan Lever Limited launches Biscuits under the name of 'Lux'? Only positive example that could quote is the market accepted 'Anchor' well known for switches, when they launched the toothpaste under the same name. Yet, the market reaction towards the brand is not very encouraging in terms of numbers i.e. sales. Hence, it clearly portrays the outcome that products of internal consumption could well be extended to products of external consumption (such as 'Amul' represents the under garments) and definitely, not very positive in case of products of external consumption to internal consumption. So, the name plays a crucial role in dictating the perception filter of potential users, needless to say, their buying behavior.

Desire: Desire is the final key aspect that induces consumers to go for a product/service. Brand ought to inferno the desire in the consumers' hearts, not minds (Mind is normally the thing which focuses mainly on rational aspects) to buy the product/service. For instance, everyone wants to become a proud owner of 'Mercedes Benz' or 'BMW' and so on. The power of a brand is to create enormous desire in the hearts of potential target and takes care of the perception filter. If we look at the AIDA model, the desire is the last action that induces the Action i.e. purchase. Albeit, the product/service has every requisite feature/trait that a potential consumer looks for, her buying decision would fully be influenced by the desire, desire is the force forces a decision. Hence, brand ought to have the trait to induce the desire of potential users.

Brand loyalty – Changing pace

The brand loyalty would be gained through the willingness of consumers to buy or influence their peer group from one brand albeit many substitutes available. Unfortunately, the present market trends are not very encouraging to exercise and maintain brand loyalty as the market witnesses the influx of many new brands. The fact is that the invasion of more brands in the market arena facilitates potential users to have wide bouquet of choices to choose with. Moreover, present economic condition in the country made people to become more price sensitive. Also, potential users would gauge the quality of a product/service through the satisfaction derived from the formed for the price they paid for. These factors have tremendous influence on breaking of brand loyalty. Yet, brand is a living thing would always fight to get the top of minds of consumers facilitate their buying decision.

Go with the market

The dimension of a brand is only a particular aspect that induces consumers to choose their likely brand. Yet, the invasion of value for money products and evolving trends in the market keep consumers at bay for not to pay whooping price on a product/service. Also the sea change in consumer behavior in line with the present market dynamics would also affect the prospect of brands survival and success. Yet, be it value for money products/brands or premium brands, the trust and reliability are the most important factors to influence the target group to open their wallets, it is wide or narrow, it is entirely up to the performance of products/brands to convince and of course, to satisfy their mounting expectations, because, they have after all have alternatives to shift. Is it not?
 


A M Sakkthivel
Faculty-Marketing Area, Department of Management Studies
Tech Park
PES Institute of Technology,
Bangalore–560 085
Phone : 91-98452 25561
E-mail :
sakkthi@yahoo.co.uk
 

Source : E-mail July 5, 2004

 

B A C K

 

Important Note :
Site Best Viewed in Internet
Explorer in 1024x768 pixels
Browser text size: Medium