Reflections of the MP: Branding of your Brand
A multinational cement company was perplexed. While they planned to set up a plant in Bangladesh, they had to import from their plants elsewhere, especially India, being so near and cost effective. However, there seems to be a public perception of anything Indian being second grade. Their brands are world wide the same, so is our quality standards, as is with most multinationals.
How do they brand their cement? A brand is today’s most precious business asset. Therefore multinationals are promoting universal or global brands. Look around you – a Coke is a coke anywhere in the world.
What is important for management is to understand the pricing implications. Quite obviously, the price of imported cement will not be the same as is in India. If there is too much of a difference, you will see a ‘loss of business’ on our side, though your counterparts in India will gain.
The fact remains, our borders are too porous – even cement bags will find their way into Bangladesh, not to worry about the sarees before Eid, or the truck loads of cattle that find their way to the meat market. I wish someone would do a calculation on the informal trade that goes on between the two countries!
If you can sort the pricing issue – keep it as close as possible to theirs – then lets worry about brands. Basically there are two alternatives – either to have a new brand – you build your own – or stick to global brands. Each has its pluses and minuses.
For global brands, one advertisement in one media (ZEE, Star etc) tells the whole story. Personally, I believe global brands are good for consumer or high value items – not things in between. For the latter items, the payoff to smuggle is too small (what do you make if you bring in a Coke from India?) or you simply cannot smuggle in a high value good – for example, a Tata Sumo, can you? For products like medicines, sarees etc. the margins can be attractive enough to find their way in.
The other alternative which I would advocate, is to build our own local brand. There is enough demand in Bangladesh for cement for you to have your own brand. This way, you safeguard against pricing issues (and you won’t worry about the Taka taking a slide and having endless negotiation with the other side to readjust). Your brand can have local meaning, local flavour. Building a brand needs hard work – creative promotion, resources. Once you’ve got your brand established, the sales and cash will flow.
Brands are long-term investments. Cement from a credible source will buy you in with your customers. Cement your brand in the mind of the customer. Next time he needs cement, he thinks of you and buys from you. Go get it.