Failure to perform evokes the need for brands to reinvent- D Shivakumar, CEO, Pepsico India
Pepsico India Chairman &CEO, D Shivakumar, a graduate from IIM Calcutta and one of the few alumni to be facilitated by the prestigious institute, is well known in management circles as a CEO who is all substance and no fluff. Taking center stage as the keynote speaker at the Pitch CMO Summit New Delhi on 27 March, Shivakumar speaks unabashedly and fearlessly about the need for brands to reinvent and their inability in doing so as desired.
“There's only one reason why a brand would need to reinvent itself and that is its failure to deliver on the promises made to its consumers”, says Shivakumar. He says, “Brands are fundamentally about emotions. Strong brands evoke strong emotions therefore have stronger recall. Brands need to identify an ‘emotion set’ specific to themselves. They need to reinvent the emotions in order to reinvent themselves”, says Shivakumar.
He says that over the past few years three new consumer groups have emerged with a very strong presence and they cannot be ignored:
The Hybrid Consumer- The hybrid consumer is someone who drives a Mercedes, wears a Nike shoe and eats at a Mcdonalds. He cannot be classified under a specific income segment. To serve this consumer category there are now hybrid products that need hybrid distribution through hybrid channels.
Tweens- Tweens have arrived as a set of consumers who may in fact be 13 years of age but behave like a 30 year old. They are more evolved than the previous generation of teens, they are more aware and certainly more demanding.
Contemporary Aunties- ‘The aunty’ is no longer considered to be an ignorant, uninformed focus group. Today's middle aged to senior women are often very bright and savvy and capable of running circles around you on any given day. They need respect and dignity and brands need to realize that.
According to Shivakumar there are 6 ways for a brand to reinvent itself:
1. It is important for a brand to win the trust of its consumer. To achieve this it needs to convey a commitment to the society. This can be communicated in several ways but eventually success comes to those who thrive to make a visible impact.
2. Citing examples of Dove, Macintosh and Nivea, Shivakumar believes that it is important for a brand to understand its core and then expand from it. He says. “Imagine the brand as a building- Marketers can either play the role of a Security Guard or an Architect. If he chooses the guard’s position then nothing can save the brand and doomsday is inevitable but if he chooses to play the Architect then nothing can stop the brand from exploring new and unprecedented dimensions.” He adds, “I have noticed several brands developing inflated egos over time. They do not realize that to continuously improve and build themselves ‘humility’ is the key.”
3. Conversations are no longer between brands and consumers. It is about consumers talking to consumers about brands. And brands cannot afford not being part of this conversation. Brands need to be responsive to what the consumer is speaking and they have a very short window of time to do that.
4. Innovation is very important in today’s environment but not important from the standpoint of keeping a brand alive but more so to beat inflation.
5. This is the era of brand partnerships. Often when brands collaborate with each other they are able to achieve results which they independently could not have achieved. A recent partnership between Nokia, Airtel and SKS Microfinance translated into millions of phones being sold in the rural areas of India which perhaps could not have been possibly had Nokia dived into it alone.
6. India needs biz model brand owners. We are one of the few countries where modern trade and e-commerce is growing simultaneously. Every industry where the middle man is not developing is failing. Brands need to understand this and employ this.
In conclusion Shivakumar outlined what the desired approach to marketing should be and how marketing it is going to work in the future. He explained that the current scenario is that if a brand employs different agencies to serve its different needs, then each agency would have a different view on the brand. This has led to fragmentation of marketing activity. What is actually a tactic is mistaken for a strategy. Therefore to reinvent a brand it is imperative to reinvent the marketing department.
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