National Institute of Technology 2009 M.B.A Finance KETING MANAGEMENT - Question Paper

Q.4: A) How can a company make better brand decisions?
ANS:
The 1st branding strategy decision is whether to develop a brand name for a product. Today, branding is such a strong force that hardly anything goes unbranded. So-called commodities do not have to remain commodities. A commodity is a product presumably so basic that it cannot be physically differentiated in the minds of consumers. Over the years, a number of products that at 1 time were seen as essentially commodities have become highly differentiated as strong brands have emerged in the category. In the Indian context, Captain Cook was 1 of the brands that used mass media advertising to differentiate salt, based on its property of “free flow”. The “white revolution” that significantly improved milk production in India through the cooperative movement created several milk brands such as Aavin in Tamil Nadu, Milma in Kerala, Nandini in Karnataka, and Vijaya in Andhra Pradesh. The most well-known brand of milk and milk products in India is Amul from the Gujarat Cooperative Milk Marketing Federation. These bands were developed in markets where traditionally milk was sold unbranded and “loose”.
Assuming a firm decides to brand its products and services, it must then select which brand names to use. 4 general strategies are often used:
Individual names: This policy is followed by many companies. For example, Procter & Gamble (India) has several individual brands in various product categories such as Vicks (Health care), Whisper (Feminine Hygiene), Ariel and Tide (fabric care), Pantene, Head & Shoulders and Rejoice (hair care), and Pampers (Baby care). A major advantage of an individual-names strategy is that the company does not tie its reputation to the products. If the product fails or appears to have low quality, the company’s name or image is not hurt. Companies often use various quality lines within the identical product class. Delta branded its low-fare air courier Song in part to protect the equity of its Delta Airlines brand.
Blanket family names: This policy is followed by Tata. The blanket family name of the company is used in diverse product categories such as salt, tea, coffee, automobiles, and steel. A blanket family name also has advantages. Development cost is less because there is no need for “name” research or heavy advertising expenditures to create brand-name recognition. Furthermore, sales of the new product are likely to be strong if the manufacturer’s name is good.
Separate family names for all products: In India, the Aditya Birla Group follows this policy to a great extent. Hindalco Aluminum, Ultra tech cement, Grasim Suiting, and Graviera suiting are a few examples of this. If a company produces quite various products, it is not desirable to use 1 blanket family name.

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