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Roank Sanghvi B-19chirag Tolia B-42Devang Madia A-41Rahul T B-39

GROUP MEMBERS

INDEX

THEORY Pg 1 to 18

Mcdonalds Case Study Pg 19 to 29

TATA Case Study Pg 30 to 39

Colgate Case Study Pg 40 to 49.

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What is Brand Equity?

There is no universally accepted definition of brand equity. The term means

different things for different companies and products. However, there are

several common characteristics of the many definitions that are used today.

From the following examples it is clear that brand equity is multi-dimensional.

There are several stakeholders concerned with brand equity, including the

firm, the consumer, the channel, and some would even argue the financial

markets. But ultimately, it is the consumer that is the most critical component

in defining brand equity. Brand Equity is defined as follows:

Brand equity represents the value (to a consumer) of a product, above that

which would result for an otherwise identical product without the brand's

name. In other words, brand equity represents the degree to which a brand's

name alone contributes value to the offering (again, from the perspective of

the consumer)."

Brand equity can be defined as three distinct elements:

The total value of a brand as a separable asset -- when it is sold or

included on a balance sheet. (Brand Valuation)

A measure of the strength of consumers' attachment to a brand. (Brand

Loyalty)

A description of the associations and beliefs the consumer has about the

brand. (Brand Description)

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Brand Equity as Brand Value

Brand value involves actually placing a dollar or rupee value on a brand

name. The reasons for doing this are usually to set a price when the brand is

sold and also to include the brand as an intangible asset on a balance sheet

(a practice which is not used in some countries).

It is important to note that there is a significant difference between an

"objective" valuation created for balance sheet purposes, and the actual price

that a brand may get when sold.

A brand is likely to have a much greater value to one purchaser than another

depending on the synergy that exists. For acquisitions, the value of a brand to

a certain purchaser is often estimated through scenario planning. This

involves determining what future cash flows the company could achieve if it

owned and took advantage of the brand.

Brand Equity as Brand Loyalty

Loyalty is a core dimension of brand equity and is a way to gauge the

strength of a brand. It represents a barrier to entry, a basis for a price

premium, and time to respond to competitive innovations. The variety of

measures used for brand loyalty usually is a combination of one or more of

the following:

Price/demand measures--focus on a brand's ability to command a higher

price or make consumers less sensitive to price increases than price

increases for competing brands.

Behavioral measures--focus on consumers' behavior.

Attitudinal measures--focus on general evaluative measures such as

'liking' or 'disliking.'

Awareness measures--focus on identifying a brand as being associated

with a product category.

Brand Loyalty and Equity refer to the notion that some brands are "stronger"

or better than others.

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Brand Equity as Brand Description

Brand description, the final component of brand equity, concerns the actual

attributes of the brand. These attributes or associations are major creators of

brand loyalty. A wide variety of techniques exist for matching consumer

associations with perceptions of a brand. These techniques can be both

qualitative and quantitative. They work by getting the respondent to link each

brand with pictures or words. These attributes then can be measured with

multi-dimensional scaling to position the attributes relative to one another.

Qualitative Measures: The Brand Equity Ten

The Brand Equity Ten are ten sets of measures grouped into five categories,

which attempt to gauge the strength of a brand. The first four categories

represent customer perceptions of the brand along the four dimensions of

brand equity- loyalty, perceived quality, associations and awareness. The fifth

includes two sets of market behavior measures.

Loyalty

1. Price Premium: A basic indicator of loyalty is the amount a customer will

pay for a product in comparison to other comparable products. A price

premium can be determined by simply asking consumers how much more

they would be willing to pay for the brand.

2. Customer Satisfaction: A direct measure of customer satisfaction can be

applied to existing customers. The focus can be the last use experience or

simply the use experience from the customer's view.

Perceived Quality and Leadership Measures

3. Perceived Quality is one of the key dimensions of brand equity and has

been shown to be associated with price premiums, price elasticity’s, brand

usage and stock return. It can be calculated by asking consumers to directly

compare similar brands.

4. Leadership/Popularity has three dimensions. First, if enough consumers

are buying into the brand concept it must have merit. Second, leadership

often taps innovation within a product class. Third, leadership taps the

dynamics of consumer acceptance. Namely, people are uneasy swimming

against the tide are a likely to buy a popular product. This can be measured

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by asking consumers about the product's leadership position, its popularity

and its innovative qualities.

Associations/ Differentiation Measures

5. Perceived Value: This dimension simply involves determining whether

the product provides good value for the money and whether there are

reasons to buy this brand over competitive brands.

6. Brand Personality: This element is based on the brand-as-person

perspective. For some brands, the brand personality can provide links to the

brands emotional and self-expressive benefits.

7. Organizational Associations: This dimension considers the type of

organization that lies behind the brand.

Awareness Measures

8. Brand awareness reflects the salience of the product in the

consumer's mind and involves various levels including recognition, recall,

brand dominance, and brand knowledge and brand opinion.

Market Behavior Measures

9. Market Share: The performance of a brand as measured by market

share often provides a valid and dynamic reflection of the brand's standing

with customers.

10. Price and Distribution indices: Market share can prove deceptive

when it increases as a result of reduced prices or promotions. Calculating

market price and distribution coverage can provide or more accurate picture

of the product's true strength. Relative market price can be calculated by

dividing the average price at which the product was sold during the month by

the average price at which all the brands were sold.

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Financial Perspectives

There are several possible ways to measure brand equity in financial terms.

Brand Equity Index Model

Under this model brand equity is calculated by multiplying the relative price

of the product by market share in units. The product is then multiplied by a

measure of loyalty or durability representing the staying power of the brand.

Book or Replacement Values  

Brand equity is estimated as the replacement cost of the brand over a generic

equivalent. A generic equivalent is a product that is sold only on the basis of

product attributes. Alternatively, replacement value can be estimated as book

value. The challenge with this latter method is that marketing expenditures

do not appear on the balance sheet. For either method, replacement cost is

difficult to estimate accurately.

Market Transactions  

Brand equity is estimated by identifying comparable mergers or acquisitions.

The premiums paid for those companies are associated with the equity in

their brands. Data is scarce for comparable M&A's, however, and buyers could

have paid more or less than the true value of brands.

Incremental Cash Flow from Branding  

Determining the cash flows of a brand and subtracting the cash flows from

unbranded product estimate brand equity. The estimation challenge becomes

more difficult as the product of interest belongs to an increasingly

differentiated category. For example, it is harder to find a generic equivalent

for cars than for cigarettes.

Discounted Value Of Future Earnings Projections  

Brand Equity is evaluated by discounting the value of future earnings

projections and adding to the value the cost competitors would incur if they

duplicated the brand.

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Price/Earnings Multiple  

Multiplying current earnings by an estimate for P/E multiple yields an equity

price. The critical step is estimating the P/E multiplier. One approach that has

been taken is to measure brand strength by a weighted average of seven

factors. (Penrose, 1989) Next, the P/E multiplier is estimated using and S-

shaped relationship between brand strength and the P/E multiple that is

based on similarities to risk free rates, industry rates, and other factors.

Value of Avoided Advertising  

Advertising is a key tool for developing brand strength that management can

leverage into equity. Advertising can affect how readily a consumer

associates attributes with a brand, what brands consumers include in their

evoked set, and other behavioral and perceptual factors. The effect of

advertising builds up over time and leads to extending brands with greater

ease and less cost. An estimate of Brand Equity is the value of advertising

avoided to achieve the current level of performance.

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Managing Brand Equity

Consistency is the key to successfully building and managing brand equity.

Having a long-term outlook and projecting a consistent image of your brand

to the customer will maximize the results of building brand equity. It is critical

for managers to realize that brand equity can have positive as well as

negative effects on a product or company. In the end, it is the customer that

truly defines what brand equity means.

If management feels it is necessary to change the direction of a brand or

change a product it must be careful not to change too quickly. There are

many examples of companies that have changed a product or brand too

much or too quickly. On these occasions, consumers met changes with

adverse reactions. The most famous example is Coca-Cola. They changed the

formula of their flagship product Coke, and consumers reacted so poorly to

the new product that the old formula was reintroduced and the new formula

eventually was discontinued. The consumer through the product experiences

brand equity. The product has certain attributes or characteristics that deliver

the equity to the consumer. If any of these attributes are changed or

eliminated, the equity delivered to the consumer is also changed.

Managing brand equity is a continual process with long-term implications.

Unfortunately, many brand managers are forced to focus on short-term goals

such as market share and profits. Many programs that are implemented to

boost short-term sales or market share may be detrimental to the long-term

viability of the brand. For example, Proctor & Gamble has started to test

market a program to move away from using coupons to a system of every

day low prices. This is, in part, because consumers may become loyal to the

coupon or promotion and not to the product itself. Constant promotional

programs erode margins and eventually brand loyalty. Ultimately, brand

equity is damaged.

In 1988, Graham Phillips, Chairman of Ogilvy and Mather Worldwide, said, "I

doubt that many would welcome a commodity marketplace in which one

competed solely on price, promotion and trade deals, all of which can be

easily duplicated by competition. This would lead to ever decreasing profits,

decay, and eventual bankruptcy. About the only aspect of the marketing mix

that cannot be duplicated is a strong brand image." This quote clearly

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demonstrates the importance of managing brand equity. In many categories,

brand equity is the only point of differentiation between products.

Many people may think that building and maintaining brand equity is solely

the responsibility of brand managers, but it is actually a cross-functional team

effort. Financial managers are important because they can fully analyze the

costs of maintaining and building brand equity. For example, launching a new

brand is extremely consuming in terms of money and time. It may be more

cost effective to extend a current brand than introduce a new brand.

Marketing research is critical for many obvious reasons. It develops most, if

not all, of the research and data that companies will use for deciding strategic

issues. Marketing research can also help determine how brand equity is

actually measured. Once a definition of brand equity is established, the

responsibility of tracking

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Brand Image

Images evoked by exposure to a named brand like brand personality, brand

image is not something you have or you don't! A brand is unlikely to have one

brand image, but several, though one or two may predominate. The key in

brand image research is to identify or develop the most powerful images and

reinforce them through subsequent brand communications. The term "brand

image" gained popularity as evidence began to grow that the feelings and

images associated with a brand were powerful purchase influencers, though

brand recognition, recall and brand identity. It is based on the proposition

that consumers buy not only a product (commodity), but also the image

associations of the product, such as power, wealth, sophistication, and most

importantly identification and association with other users of the brand. In a

consumer led world, people tend to define themselves and their Jungian

"persona" by their possessions. According to Sigmund Freud, the ego and

superego control to a large extent the image and personality that people

would like others to have of them.

Good brand images are instantly evoked, are positive, and are almost always

unique among competitive brands.

Brand image can be reinforced by brand communications such as packaging,

advertising, promotion, customer service, word-of-mouth and other aspects of

the brand experience.

Brand images are usually evoked by asking consumers the first words/images

that come to their mind when a certain brand is mentioned (sometimes called

"top of mind"). When responses are highly variable, non-forthcoming, or refer

to non-image attributes such as cost, it is an indicator of a weak brand image.

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Laws of Brand Equity

The Law of Contraction : A brand becomes stronger when its focus is

narrowed. This does not imply carrying a limited product line, but rather

limiting and focusing a brand on only one type of core product, which in

Titan's case happens to be watches. Titan, though possessed of a wide

product line, has stuck to its focus. It hasn't launched other types of products

and stuck them with the Titan name, which would have only gone on to

cannibalize the value of the core brand. As a result of this, Titan has

developed for itself an image of being "time-keeping experts" in the minds of

the consumers.

The Law of Advertising: Once born, a brand needs to actively advertise

in order to stay healthy and maintain market share. If done right, advertising

is more of an investment than an expense. Titan has implemented this by

always maintaining a high degree of visibility when it comes to its advertising.

In addition, it possesses one of the most recognizable ad-jingles in the history

of Indian advertising.

The Law of the Word: Any brand worth its salt should strive to "own" a

word or words in the mind of the consumer. Examples of such brands are

Volvo, who owns the word "safety", Mercedes, who own the word "prestige"

and Coca-Cola, who own the word "cola". Titan, at least when viewed in the

context of the Indian watch market, seems to own the word "quality". Though

unsubstantiated by any formal market research, in an informal survey we

conducted among a sample of 30 people we know (including friends, family,

neighbors and acquaintances), 19 of them, when asked what one word came

to mind when they heard 'Titan Watches' answered "quality". A further 8

answered "Indian", another word that would do Titan absolutely no harm to

own in the minds of their prospects.

The Law of Quality: Though quality is essential to the survival and

growth of any brand, the fact remains that brands are not built by quality

alone. The perception of the brand is as, if not more significant than mere

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quality. It is here that Titan "scores". As mentioned previously Titan more or

less owns the word "quality" in the minds of the consumers, thereby implying

that it is perceived as a quality product. Thus, it's actual quality, as well as it's

perception of being a quality product combine to work towards building the

strength of the Titan brand.

The Law of the Name: In the long run, a brand is nothing more than a

name. The difference between products is thus not so much between the

products, as it is between their names, or perceptions of the names. Seeing

as how its name is perhaps the most important element of a brand, we feel

that this point warrants a slightly more in-depth discussion.

Joe Marconi identifies 4 major factors to be kept in mind while

naming a brand:

1) It should suggest stability and integrity.

2) It should avoid negative imagery.

3) It should avoid acronyms, the use of which Ries and Trout call "the no-

name trap". (Perhaps the sole exceptions to this are BMW & IBM).

4) It should avoid anything-generic sounding (General, National, Standard,

etc), as this would not help in defining a brand's personality.

Let us see to what extent Titan satisfies these conditions. First of all, the

name 'Titan' itself comes from Greek mythology, and symbolizes greatness,

grandeur and power. Remember the Titanic? It is easy to pronounce, as well

as to remember. One only has to compare its name to that of its biggest

competitor, HMT to see how well thought out the name Titan is. HMT, while

being an acronym, expands out to 'Hindustan Machine Tools', a generic name

if we ever heard one. Asides from all these differences, the question of

perception arises. A watch is a product, the purchase of which is perhaps

driven more by perception than anything else. What sounds more classy and

sophisticated? Titan or Hindustan Machine Tools?

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The Law of the Company: Brands are brands, and companies are

companies. There is a difference. Titan is owned by the Tata Group, who

though highly regarded in Indian industry are associated more with heavy

industries such as steel and truck building, than with watch making. Chances

are that no one would buy a Tata watch (its name invoking the same, if not

greater reaction than an HMT). People would, however buy a Titan.

The Law of Siblings: There is always a time and a place to launch a

second brand, but when this is done it should be ensured that both brands

have separate and distinct identities. Each brand should be kept unique and

special. When Titan decided to diversify into the jewellery segment, they did

not call their new brand 'Titan Jewellery', inspite of the high standing of the

Titan name in the minds of the Indian consumers. To do so would be to

undermine the power of the Titan brand; this is that of being “watch experts”.

Hence, the jewellery was called Tanishq.

The Law of Shape: A brand's logotype should be well designed, in order

to fit the eyes. Visual symbols (again with the possible exceptions of Nike's

"swoosh" or Mercedes' 3-pointed star) are highly overrated. The meaning lies

in the words, not the symbol. The Titan logo, though well recognizable (please

refer to the cover page in the rare event that you do, in fact actually NOT

recognize it) is always accompanied by the words "TITAN" in a clear, crisp

typeface-denoting power (through the use of capital letters) and class at the

same time.

The Law of Colour : A brand should use a colour and typeface that is the

opposite of its major competitor. For example, while Coca-Cola stands for red

and appears in running handwriting, Pepsi stands for blue and appears in

capital, modern looking letters. Similarly, while HMT appears in small silver

lettering, Titan appears in capital letters, and is usually in black.

The Law of Borders: Finally, a brand should know no borders or

boundaries. With a name that stands for Hindustan Machine Tools, HMT would

be hard-pressed to sell a single watch outside Indian Territory. Such is not the

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case with the more globally oriented name, Titan. As mentioned previously,

Titan is sold in over 40 countries through marketing subsidiaries in London,

Singapore and Dubai.

Thus far, we have restricted ourselves to issues exclusively concerned with

the role of the brand in building brand equity. The fact however remains that

brand building is an exercise that requires effort in a number of ways, many

of them unrelated to the actual "brand" as such. These could be related to the

product's image, the company's image, public perception of the parent

company, and efficiency of promotional measures, to name but a few.

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Do’s & Don’ts in Brand Equity

Define the core brand's position and value clearly:

A product should be properly positioned and its value (which includes price,

quality and image) should be properly defined. As mentioned in the section

regarding the law of the word, the two words most highly identified with Titan

are “quality" and "Indian". These should thus be emphasized upon. This is

exactly what Titan has done, positioning it's watches as high quality, Indian

made watches, and emphasizing upon it's value for money as well as it's

classy image.

Don't neglect Public Relations:

Public Relations, or PR, are vital to the success and survival of any brand.

Unfortunately, its value as a brand building tool has more often than not,

been undervalued. Newsletters, event and entertainment sponsorships, and

other forms of PR help to define the personality of a company or brand,

positioning it as a good corporate citizen, and someone nice to do business

with. In keeping with India's obsession with cricket, Titan has often sponsored

cricket tournaments, including the now legendary 1997 Titan Cup. Titan also

sponsors a number of popular television programmes, a prime example of

which is Star World's "The Practice".

Realize that promotions can be tricky:

Promotions ought to be used to create recognition and build brand loyalty.

Needless and irrelevant contests tend to shift the customer's attention from

the product being promoted to the prize being offered (be it a trip to the US

or a new car). A better (and far less expensive) way to promote a brand would

be to allow it to be used by other companies in their promotional offers. Titan

is currently being offered by both Outlook magazine and Welcome Award (the

privileged customer programme of the Welcome Group chain of hotels) in

their various promotional offers. The most sensible and effective forms of

promotions are measures such as establishing a privileged customer club

offering customer points redeemable for discounts and rebates. Titan has

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their own privileged customer club, Titan Signet, which has an impressive 1.6

lakh members.

Always remember the USP:

A USP (Unique Selling Proposition) is not only what gives the customer a

reason to buy the brand, but is also what helps him distinguish the brand

from its competitors. Titan's USP is two fold, and can perhaps best be

described in six words. "An Indian company offering international quality".

This works for Titan in two ways. First of all, it's emphasis on 'international

quality' successfully negates it's major Indian competitor, HMT, who is still

perceived as a company offering solid and reliable, yet singularly unstylish

and staid looking watches. Secondly, with the plethora of foreign brands

available in the country today, Titan emphasis on being Indian enables it to

effectively meet their threat. Interestingly, while Titan has never actively

promoted the fact that its parent company is the Tata Group, at the same

time it has never really done much to hide the fact. Thus while capitalizing on

the Tata name; it has built its own identity as an Indian brand offering high

quality watches at prices significantly below those of comparable foreign

brands.

If you can't be first, be better:

Being the first entrant in any category earns pioneer status for a brand and

gives it the advantage of being the probable market leader. Such was the

case with HMT. However with its emphasis on its USP and aggressive

advertising, Titan convinced the market that it produced the better product

and thus destroyed HMT's near monopoly of the Indian watch market.

Expand sensibly:

Extensions should always be logical and market driven and not mere "product

explosions". As the market environment changes with the addition of say,

greater competition, or changing customer wants and perceptions, brand

extension should be undertaken. It should not, however be undertaken

arbitrarily. When Titan entered the market in 1987, its main competitor was

HMT, a company offering reliable and economically priced watches. Titan thus

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started out being a company offering a wide variety of models, most of which

were priced economically, with the added USP of being a more stylish

alternative to HMT. As times changed, however, so did Titan. With the

growing entry of foreign brands into the market, Titan continued to introduce

sub brand after sub brand to meet every new challenge. With the entry of the

"high performance" sports watch brands in the form of Tag Hauer, Omega

and Breitling, Titan introduced it's own line of chronographs priced

significantly lower than the competition at a mere Rs 5000-6000. Similarly, to

counter the entry of foreign, youth oriented "style" brands such as Esprit and

Swatch, Titan introduced the 'Fast Track' sub brand, again priced extremely

competitively.

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Case study on McDonald’s

What is McDonald’s?

McDonald’s is the world’s largest and best-known global leaders in food

service retailing, with more than 27,000 restaurants serving more than 43

million customers a day in 119 countries. Approximately 80 percent of

McDonald’s global restaurants are owned and operated by independent

franchisees. Yet on any day, even as the market leader, McDonald’s serves

less than one percent of the world’s population. McDonald’s out-standing

brand recognition, experienced management, high-quality food, site

development expertise, advanced operational systems and unique global

infrastructure position it to capitalize on global opportunities.

Name: Ray Kroc Founder of McDonald’s

MR. RAY KROC (1954) first franchisee appointed by Mac and Dick McDonald in

San Bernardino, California. The first McDonald’s built in 1940 by the

McDonald brothers (Dick and Mac). Ray Kroc was the founder of the

McDonald’s Corporation. Brothers Mac and Dick McDonald opened the first

speedee Shakes and Burgers drive-in called McDonald’s in 1953 in St

Bernardino, California. They were persuaded to sell the name to milkshake

salesman, Kroc, who opened the first store of the McDonald’s Corporation in

1955 in DesPlaines, Illinois. McDonald’s now has over 20,000 stores in 90

countries.

The company claims it serves 29 million people a day and that a new store

opens some- where in the world every seven hours. Kroc died in the 1980’s

but he has his own shrine in the Corporation’s headquarters with video-audio

hooks-ups so that he can answer trainee managers questions from the grave.

His widow, apparently a billionaire, is still alive and resides in La Jolla,

California.

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A Brief History Of McDonald’s

Dick and Mac founded the first McDonald’s restaurant in 1937 in a parking lot

in California. It did not serve burgers, had no happy meals or a playground.

The most popular item on the menu was the hotdog and people ate either on

outdoor stools or in their cherished new autos while being served by teenage

carhops. The first McDonald’s drive-in was built in 1940 by the McDonald

brothers.

1954 – 1968

Ray Kroc became the first franchisee appointed by Mac and Dick McDonald in

San Bernardino, California. Ray Kroc opened his first restaurant in Des

Plaines, Illinois (near Chicago). First day’s revenues-$366.12 and the

McDonald’s Corporation was created. Quality, Service, Cleanliness and Value

(Q.S.C. & V.) became the company motto. The 100th McDonald’s opened in

Chicago. Ray Kroc bought all rights to the McDonald’s concept from the

McDonald’s brothers for $2.7 million. Hamburger University opened in Elk

Grove, near Chicago.

One billion hamburgers sold.

The 500th restaurant opened

The 500th student graduates from Hamburger University

Ronald McDonald made his debut

McDonald’s net income exceeded $1 million.

Filet-o-Fish sandwich introduced. McDonald’s Corporation went public. Per

earning ratio varies from 10 to 22 during year; stock price range, 15 - 33.5.

McDonald’s listed on the New York stock exchange on the 7th May. The first

restaurants outside of the USA opened in Canada and Puerto Rico. The Big

Mac was introduced. The 1,000th restaurant opened in Deslaines, Illinois.

1970 – 1980

McDonald’s restaurant in every US state. Ray Cesca (Director of Global

Purchasing of the McDonald’s Corporation) has admitted that when

McDonald’s opened stores in Costa Rica in 1970, they were using beef from

cattle raised on ex-rainforest land, deforested in the 1950™s and 1960™s.

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New countries - Virgin Islands, Costa Rica. The Egg McMuffin sandwich was

test marketed in the US as McDonald’s first break fast menu item. McDonald’s

Japanese President, Den Fujita, stated it the reason Japanese people are so

short and have yellow skins is because they have eaten nothing but fish and

rice for two thousand years; so if we eat McDonald’s hamburgers and

potatoes for a thousand years we will become taller, our skin become white

and our hair blonde. New countries - Japan, Holland, Australia, Germany,

Panama, Guam. Assets exceeded $500 million and sales surpassed $1 billion.

A new McDonald’s restaurant opening every day. New countries - France, El

Salvador. The 2,000th restaurant opened in Des Plaines, Illinois. The Quarter

Pounder was introduced.

McDonald’s Golden Arches Restaurants Limited founded in UK as a joint

venture partnership between the McDonald’s Corporation and two

businessmen; one British, one American. New country - Sweden. Egg.

McMuffin introduced. The 3,000th McDonald’s restaurant was opened in

Woolwich (south east London) in October, the first in the UK. The Company’s

first Drive-Thru opened in Sierra Vista, Arizona. New countries – Hong Kong,

Bahamas, Nicaragua. Fred Turner becomes Chairman, Ray Kroc Senior

Chairman, and Ed Schmitt becomes President. Broadcast advertising

appeared in UK cinemas. McDonald’s first UK TV advertisement was

broadcast. 4,000th store opened in Canada. New countries - Switzerland, New

Zealand. Largest restaurant opens - with 334 seats. New countries - Ireland,

Austria. Breakfast menu introduced, nationally in America. The 5,000th

restaurant opened in Kanagawa, Japan and it made US $1 million in its first

year. Sundaes introduced in USA. New countries - Brazil and Singapore. The

6,000th restaurant opened in Munich. After workers in a store in Detroit

(USA). First floating restaurant on a steamer in Missouri. 1,000th international

restaurant opened.

1981 – 1990

New countries - Spain, Denmark and Malaysia. Geoffrey Guiliano, a main

Ronald McDonald actor, quit and publicly apologized, stating it brainwashed

youngsters into doing wrong. I want to say sorry to children everywhere for

selling out to concerns that make millions by murdering animals. 7,000 th

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restaurant opened in Washington DC. McDonald’s was responsible for food

poisoning outbreak caused by Coli bacteria, which affected 47 people in

Oregon and Michigan, USA. Egon Ronay calls McDonald’s burgers ‚uninspiring.

Breakfast was introduced to the British menu. The McDonald’s Corporation

became sole owners of McDonald’s in the UK. The Company is named

McDonald’s Hamburgers Limited. Introduction of Chicken McNuggets in USA.

New Hamburger University campus opens in Oak Brook, Illinois. Founder Ray

Kroc dies. 50 billionth hamburger sold. Ronald McDonald Children’s Charities

is founded in his memory to raise funds in support of child welfare.

McDonald’s now serves 17 million customers a day - equivalent to serving

lunch to the entire population of Australia and New Zealand. If McDonald’s

lined up all the hamburgers sold since 1955, they would: -

Circle the equator 103.75 times;

Reach to the moon and back 5 times.

Drive-Thru restaurants opened in UK at Fallowfield, Dudley, Neasden and

Coventry. Four workers in Madrid who had called for union elections were

sacked by McDonald’s. The company was forced to reinstate the workers

after the labour court ruled that the dismissals were illegal. The 200th UK

restaurant opened in Ipswich. McDonald’s became the first UK restaurant

group to introduce nutritional information, throughout the country, for the

benefit of customers. McDonald’s sponsored the Child of Achievement

Awards. CFCs ceased to be used for most of McDonald’s Styrofoam

packaging. 300th UK restaurant opened in Dagenham, Essex. McDonald’s is

listed on the Frankfurt, Munich, Paris and Tokyo stock exchanges. Michael

Quinlan is appointed Chairman and Chief Executive Officer. The UK

company’s name was changed to McDonald’s Restaurants Limited.

McDonald's opened in Pushkin Square and Gorky Street, Moscow. McDonald's

opened at a UK airport at North Terminal, Gatwick. The first Ronald McDonald

House opened at Guy's Hospital, London.

1991 – 2000

The 150th Ronald McDonald House opened in Paris. McDonald's opened in

Beijing, China. The 400th UK restaurant (and first in Northern Ireland) is

opened in Belfast. McDonald's opens in Hampstead (North London) despite

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strong opposition from local residents. McDonald's opened in a railway station

at Liverpool Street, London. The 400th UK restaurant (and first in Northern

Ireland) is opened in Belfast. McDonald’s opens in Hampstead (North London)

despite strong opposition from local residents. The first McDonald’s at sea

opened aboard the Silja Europa, the world’s largest ferry sailing between

Stockholm and Helsinki. 500th UK restaurant opened in Notting Hill Gate,

London. First UK operated restaurant on a ship opened on the Stena Sealink

ferry ‘Fantasial’ sailing between Dover and Calais. Restaurants opened in

Bahrain, Bulgaria, Egypt, Kuwait, Latvia, Oman, New Caledonia, Trinidad and

United Arab Emirates, bringing the total to over 15,000 in 79 countries on 6

continents. McDonald’s celebrated twenty years of operating in the UK. On

15th April, there were international protests to mark the 40th anniversary of

the opening of the world’s first store of the McDonald’s Corporation. February

16th 10am, the McSpotlight website was launched. The Vegetable Deluxe

lunch was launched in the UK. McDonald’s opened stores in India. McDonald’s

and Disney announced a deal giving McDonald’s exclusive rights to use

characters from Disney films in its promotions around the world for 10 years.

Commentators called it the biggest global marketing alliance yet devised.

McDonald’s opened a store in Belarus, its 100th country. The movie star

Robin Williams turned down a million-pound offer to advertise McDonald’s.

Chicago, IL, July 25, 2000 - McDonald’s Corporation, through eMac Digital, a

company recently formed with Accel-KKR, formed electronic Foodservice

Network (EFS Network), a company that will operate an independent B2B

marketplace to facilitate sales and purchases to the foodservice industry and

will help maximize Internet-based efficiencies and savings for its participants

across the entire supply chain.

History Of McDonald’s Brand

Mac and Dick McDonald established McDonalds brand in 1940 by using their

surname. In 1962, When Dick McDonald sent Kroc an illustration of the

McDonald family crest, Kroc had it added to the sign as a symbol of quality,

replacing Speedee, the boyish chef character that the McDonald brothers had

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developed to designate the Speedee Service System. When others insisted

that the crest was gaudy, the search was on for a more stylish corporate

symbol. Turner fiddled with the logo, based on the Cdl in the Cadillac insignia,

and Schindler used that to sketch a logo that pictured the slanted roofline of

the store piercing a line drawing of the golden arches in the form, as it is seen

world over. In 1968, the roofline image was dropped and the McDonald’s

name was added to derive the current logo. Since then logo has not

undergone any major changes. The introduction of the Ronald McDonald

character later developed a human element in the McDonald’s brand, and

provided an instant link with children.

Offering

A brand is an offering from a known source. McDonald’s carries many

associations in the minds of people: hamburgers, fun, children, fast food,

Golden Arches. These associations make up the brand image.

Attribute

A Clean Fast Food Brand which tastes the same any where you eat in the

World.

Benefits

You don’t have to stay hungry for a long time. McDonalds ready to eat

available.

Values

The World leader in Fast Food Restaurants.

Culture

The brand represents culture of social gathering for families and groups.

Personality

The World leader, A giant M.

User

All kinds of consumers buy McDonald’s products irrespective of age, sex all

over the world. One can see all types of personalities in the McDonalds

restaurant.

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Strategy Of The Management In The Whole Brand

Life Cycle

Our observation of McDonald’s Brand tell us that McDonalds as a Brand is in

its growth stage whereas, in countries like America and West Europe it is on

its way towards maturity. Following is the stage wise development and

growth of McDonalds Brand.

1940’s (Introduction Stage)

Despite being a time when there was a hamburger store or a food franchise

on every corner in America’s cities, the business that Ray was so fascinated

with had customers lining up to buy hamburgers, fries and milkshakes.

McDonald brothers in their operation of business found that they had

developed a crude but effective method of processing food in seconds. This

fast food production, combined with low prices and a limited menu was a run

away success.

1950’s (Development of McDonalds as a Brand)

McDonald’s success was stage on an illusive dream, which Mr. Ray Kroc had.

Despite being a time when there was a hamburger store or a food franchise

on every corner in America's cities, the business that Ray was so fascinated

with customers lining up to buy hamburgers, fries and milkshakes. This fast

food production, combined with low prices and a limited menu could be

duplicated across the country, and he wanted to be the one to do it.

Mr. Ray Kroc felt that the operations of McDonalds could be replicated in

every franchise. He began developing exact specifications for the ingredients

so that the taste and cooking times would be consistent. He then went on to

develop precise systems that could be documented to cover every aspect of

how the business should be run from cooking a burger and serving a

customer, to washing the floor and emptying the bins. Ray also knew that his

systems needed to extend beyond the internal operations of the business,

and into the external design of the buildings and how they were presented

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and maintained. This cloned and consistent style would maximise the value of

the McDonalds brand through the buildings appearance.

Ray was so committed to perfection, that he set up his own laboratory to

develop the perfect fries. This was a revolutionary experience for the

hamburger industry, and was not seen by many as being particularly

necessary, including his business associates. This was the success in selling

franchises (McDonald’s early establishment as a Brand)

1960’s (The real growth of McDonald’s Brand took off from here)

Ray Kroc bought all rights to the McDonald's concept from the McDonald's

brothers for $2.7million in 1961.Ronald McDonald made his debut (used as an

Advertising tool) in 1963 which saw a new image on McDonald’s brand

building in the consumers mind in the form of a human element in the

McDonalds brand, and provided an instant link with children. The rest as they

say is history. There would be barely a man women or child in the developed

world who has not tasted a McDonald’s product. Ray Krocs systems were so

highly developed and repeatable that a customer could eat a McDonald’s

product, regardless of which country they were in, and still experience the

same taste and service in a restaurant that was identical to any other in the

world.

Apart from having a visible brand by using red and yellow color. The colors

red and yellow have been shown to induce hunger. Most of McDonald’s

restaurants are decorated in the colors red and yellow.

The growth of this brand has led to McDonalds becoming a global brand

example of that is in 1996; McDonald’s overtook Coca-Cola as the best known

brand in the world McDonalds has 48 percent of the globally branded quick

service restaurants and 63 percent of sales.

List of acquisitions by McDonald’s that helped further growth in

the market.

Owns Donatos Pizza with 148 outlets from Michigan to Georgia

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23 units of coffee bars in London called Aroma Cafe™

Chipotle Mexican Grill, a fast growing chain of 56 burrito shops

859 Boston Markets

Equity stake in food.com

Figures to support growth of McDonalds:

World Wide Restaurants:

2002 2001 2000

U.S. 12,629 12,472 12,380

Europe 4,943 4,421 3,886

Asia/Pacific 5,655 5,055 4,456

Latin America 1,789 1,405 1,091

Other 1,790 1,465 1,319

Total 26,806 24,818 23,132

Another proof of that is our Indian market, which has provided a good boost

to

McDonald’s advent into India.

Future Growth:

The opportunities for McDonalds are truly global with a policy of continuous

innovation of product and service spreading the enormous depth and breadth

of the McDonalds brand, which is being well received around the world.

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Brand Equity of McDonald’s

In terms of corporate valuations McDonalds is valued at approx. US$39

billion.

In Marketing terms:

Brand Awareness

The American awareness of McDonalds as a brand is very high. Today

McDonalds is a Global name, famous for its delicious burgers and mouth

watering French fries. The customer’s awareness of the brand goes back to

the earlier days when the McDonalds brothers had decided to start off with

the restaurant. The consistent taste of the Mac meals is one of the reasons for

uniformity in the product. Today the brand is well known for its affordability

and high quality standards. Over the years the company has managed to live

upto its image by providing prompt service unfailingly, constantly improving

the standards of its burgers and providing entertainment to its target

customers mainly children who are always in the lookout for a fun filled hour

with Ronald McDonald the McDonald’s mascot. These critical improvements

have helped the brand to be popular among the millions who visit the joint for

a quick bite. One of the major recallers of the brand is the golden arch of the

McDonalds logo. The red sign with the golden M is a symbol synonymous

with burgers.

In a market like India, the brand is still in its infant stage. Launched in 1996,

the company has done quite well for an initial beginning. Catering to a

customer base which is used to eating the many delicacies offered by the

Indian cuisine which is spicy unlike the McDonalds burgers, the company has

definitely faced a few rejections from the consumer, but it was not long

before the brand took over the hearts of the younger customers, mostly the

average urban teenagers who found the place very happening and ideal for

an evening with friends.

Perceived Quality

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In a recent survey conducted by a leading agency, it was found that in India,

although most of the McDonalds found the pricing of the product quite high,

but the perceived quality of the products were rated as high as 4 or 5 out of a

scale of 5. This shows that the company has been able to live upto its high

quality standards set through operational excellence.

Brand Loyalty

From a recent survey it has been found that an average American has visited

at least one of the many outlets in a city at least once in the last year. This

can be directly related to the brand loyalty of the customer. An average

McDonald’s consumer visits the store at least once a week.

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Case Study on TATA MOTORS

Profile Of TATA Motors

Established in 1945, Tata Motors is India's largest and only fully integrated

automobile company. Tata Motors began manufacturing commercial vehicles

in 1954 with a 15-year collaboration agreement with Daimler Benz of

Germany. Since 1969, the company's products have come out of its own

design and development efforts. 

Today Tata Motors is India's largest commercial vehicle manufacturer with a

59-per cent market share and ranks among the top six manufacturers of

medium and heavy commercial vehicles in the world.

Area of Business

Tata Motors' product range covers passenger cars, multi-utility vehicles and

light, medium and heavy commercial vehicles for goods and passenger

transport. Seven out of 10 medium and heavy commercial vehicles in India

bear the trusted Tata mark. 

Commercial vehicle business unit

The company has over 130 models of light, medium and heavy commercial

vehicles ranging from two tonnes to 40 tonnes, buses ranging from 12-

seaters to 60 seaters, tippers, special purpose vehicles, off-road vehicles and

defence vehicles. 

Passenger car business unit

The company's passenger car range comprises the hatchback Indica and the

Indigo sedan in petrol and diesel versions. The Tata Sumo, its rural variant,

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the Spacio and the Tata Safari (the country's first sports utility vehicle) are

the company's multi-utility offerings.

The Tata Indica, India's first indigenously designed and manufactured car,

was launched by Tata Motors in 1999 as part of its ongoing effort towards

giving India transport solutions that were designed for Indian conditions.

Currently, the company's passenger cars and multi-utility vehicles have a 16-

per cent market share.

In addition to the growth opportunities in the buoyant domestic market, the

company is pursuing growth through acquisitions (it acquired Daewoo

Commercial Vehicles, Korea, in 2003) and alliances (it has entered into a tie-

up with MG Rover, UK, to supply 1,00,000 Indica’s to be badged as City

Rover) in other geographies. 

Environmental Responsibility

Tata Motors has led the Indian automobile industry's anti-pollution efforts

through a series of initiatives in effluence and emission control. The company

introduced emission control engines in its vehicles in India before the norm

was made statutory. All its products meet required emission standards in the

relevant geographies. Modern effluent treatment facilities, soil and water

conservation programmes and tree plantation drives on a large scale at its

plant locations contribute to the protection of the environment and the

creation of green belts. 

Exports

Tata Motors' vehicles are exported to over 70 countries in Europe, Africa,

South America, Middle East, Asia and Australia. The company also has

assembly operations in Malaysia, Bangladesh, Kenya, South Africa and Egypt. 

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Brief History of Tata Motors

It has been a long and accelerated journey for Tata Motors, India's leading

automobile manufacturer. Some significant milestones in the company's

journey towards excellence and leadership are given below:

1945 – 1966

Tata Engineering and Locomotive Co. Ltd. was established to manufacture

locomotives and other engineering products. Steam road roller introduced in

collaboration with Marshall Sons (UK). Collaboration with Daimler Benz AG,

West Germany, for manufacture of medium commercial vehicles. The first

vehicle rolled out within 6 months of the contract. Research and Development

Centre set up at Jamshedpur. Exports begin with the first truck being shipped

to Ceylon, now Sri Lanka. Set up of the Engineering Research Centre at Pune

to provide impetus to automobile Research and Development.

1971 – 1989

Introduction of DI engines. First commercial vehicle manufactured in Pune.

Manufacture of Heavy Commercial Vehicle commences. First hydraulic

excavator produced with Hitachi collaboration. Production of first light

commercial vehicle, Tata 407, indigenously designed, followed by Tata 608.

Introduce of the Tatamobile 206 - 3rd LCV model.

1991 – 1995

Launch of the 1st indigenous passenger car Tata Sierra. TAC 20 crane

produced. One millionth vehicle rolled out. Launch of the Tata Estate. Joint

venture agreement signed with Cummins Engine Co. Inc. for the manufacture

of high horsepower and emission friendly diesel engines. Launch of Tata

Sumo - the multi utility vehicle. Launch of LPT 709 - a full forward control,

light commercial vehicle. Joint venture agreement signed with M/s Daimler -

Benz / Mercedes - Benz for manufacture of Mercedes Benz passenger cars in

India. Joint venture agreement signed with Tata Holset Ltd., UK for

manufacturing turbochargers to be used on Cummins engines. Mercedes

Benz car E220 launched.

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1996 – 2004

Tata Sumo deluxe launched. Tata Sierra Turbo launched. 100,000th Tata

Sumo rolled out. Tata Safari - India's first sports utility vehicle launched. 2

millionth vehicle rolled out. Indica, India's first fully indigenous passenger car

launched. 115,000 bookings for Indica registered against full payment within

a week. Commercial production of Indica commences in full swing. First

consignment of 160 Indicas shipped to Malta. Indica with Bharat Stage 2 (Euro

II) compliant diesel engine launched. Utility vehicles with Bharat 2 (Euro II)

compliant engine launched. Indica 2000 (Euro II) with multi point fuel injection

petrol engine launched. Launch of CNG buses. Launch of 1109 vehicle -

Intermediate commercial vehicle. Indica V2 launched - 2nd generation Indica.

100,000th Indica wheeled out. Launch of CNG Indica. Launch of the Tata

Safari EX Indica V2 becomes India's number one car in its segment. Exits joint

venture with Daimler Chrysler. Unveiling of the Tata Sedan at Auto Expo

2002. Petrol version of Indica V2 launched. Launch of the EX series in

Commercial vehicles. Launch of the Tata 207 DI. 2,00,000th Indica rolled out.

5,00,000th passenger vehicle rolled out. Launch of the Tata Sumo'+' Series.

Launch of the Tata Indigo. Tata Engineering signed a product agreement with

MG Rover of the UK. Launch of the Tata Safari Limited Edition. The Tata Indigo

Station Wagon unveiled at the Geneva Motor Show. On 29th July, J. R. D.

Tata's birth anniversary, Tata Engineering becomes Tata Motors Limited. 3

millionth vehicle produced. First City Rover rolled out. 135 PS Tata Safari EXi

Petrol launched. Tata SFC 407 EX Turbo launched. Tata Motors unveils new

product range at Auto Expo '04. New Tata Indica V2 launched. Tata Motors

and Daewoo Commercial Vehicle Co. Ltd. sign investment agreement. Indigo

Advent unveiled at Geneva Motor Show. Tata Motors completes acquisition of

Daewoo Commercial Vehicle Company. Tata LPT 909 EX launched. Tata

Daewoo Commercial Vehicle Co. Ltd. (TDCV) launches the heavy duty truck

‘NOVUS’, in Korea. Sumo Victa launched. Indigo Marina launched. Tata Motors

lists on the NYSE.

Leveraging the Tata brand

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The Tata Finance controversy notwithstanding, Tata Sons is making a concerted attempt to shift focus from a commodity-oriented conglomerate to a brand-oriented corporate group.

It is an image that has stuck to the Tata Sons conglomerate all these years. But now the image is in for a makeover. Put differently, the winds of change are blowing within the organisation's formidable corridors. The corporate's portfolio is changing from 40-50 per cent commodity orientation to an equal percentage of brand orientation.

The ambitious branding exercise being undertaken by the Tata Sons group would include primarily steel, salt and trucks. The perception of Tata Chemicals, for example, is hardly that of a marketing company. But Tata Salt, marketed by Tata Chemicals, ranks upfront as a leading FMCG brand in most consumer surveys, besides, of course, being the market leader among branded salts.

GeneratioNow kind of image makeover is round the corner for the Tata brand. The Tata brand is perceived as rather middle-aged. And while the Tata brand has a fuddy - duddy image, the trust and maturity association with the brand will continue.

Mentioning the `contact points' the Tata brand touches, Tata Salt touches 400 million contact points, 500 million through Tata Tea, seven million through Titan watches, one million through vehicles, and two lakh through Tata Nova - the group's Internet business. The group's telecom business is expected to add another six million customers.

The marketing makeover exercise is on in full swing.

The moment of reckoning for Brand Tata may have just arrived.

Wah Taj...

TRUCKS, steel, chemicals, cars, tea, salt, watches, mobile services, infotech and more.

That is a complex and mammoth portfolio by any standards. And it obviously adds up to formidable brand equity.

"Tata remains the most valuable brand in the country.

It is second only to the Taj Mahal." The estimated worth of the Tata brand is about Rs 10,000 crore.

About four years back, some amount of the Tata brand value was estimated at Rs 3,800 crore. The company has extrapolated that to arrive at the Rs 10,000 crore figure - and that a couple of years back.

Consumer perception

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Tata’s set to unleash global branding drive

The $11.2 billion Tata Group is planning to unleash a major global branding initiative.

Tata Sons, the group has selected some key foreign markets to introduce a brand building drive to give effect to the group’s vision of becoming a major global brand. Tata Motors has forayed into the UK markets, TCS has a presence in US and south-east Asian countries.

The Tata group has fared well on the twin brand values of ‘emotionality and relevance.’

The perception that Tata group companies are not as aggressive as competitors is gradually changing. It is now also perceived as a more youthful brand, despite being a 100-year old brand.

Tata Motors is known as a low-cost manufacturer, not necessarily a high-quality one. The company is looking to provide value for money—or more car per car. 

In fact, Indica has never been rated highly by JD Power, which conducts consumer-based surveys. In its latest 'initial quality study' in December '03, Indica was placed fifth, second from the bottom, among the premium compact cars with 237 problems per 100 vehicles. Wagon R topped the list with 118. A caveat though: this survey takes into account actual problems as well as perceptions. Another indicator: for the UK market, the City Rover has been spruced up quite a bit. Apart from cosmetic changes like a new bumper and grille, it has different engine diagnostics and comes with airbags and anti-lock brakes. In addition, the City Rovers are petrol-driven, unlike the diesel models that form an overwhelming share of Tata Motors' India sales. 

But even the diesel models of Tata Motors are in for fresh competition. Hyundai has launched the diesel version of Accent, which it claims is superior as it has the latest microprocessors-based common rail direct injection (CRDi) technology that supposedly increases fuel efficiency and reduces pollution. It also plans to have diesel options for its forthcoming compact model, Getz, as well as Santro. Maruti, which imports the engines for its diesel Zen and therefore doesn't find it viable to make more than 500-900 vehicles a month, is also thinking of tying up with a global manufacturer for diesel technology.

Revitalising Brand Tata

The Tata group has launched a deliberate and comprehensive effort to re-energise its 124-year-old brand equity, and to connect with youth. Catalyst takes a look at how this is being done.

A FAMILY of four made its way out of the stands at Chennai's Nungambakkam tennis stadium on Day 3 of the Tata Open tournament. Outside, T2, the

35

cheery ball-shaped mascot, was sitting with some other youngsters; seeing the two kids, he sprang to his feet, came up to them, held out his hand and called out, "Hi there." The kids stepped back warily, but were quickly won over; he shook their hands, asked for their names, and then gave them a high-five before waving good-bye.

For the Rs 49,000-crore Tata group, T2 is just one visible face of a deliberate and comprehensive effort to re-energise the 124-year-old Tata brand. With 80 group companies and its share of controversy and failures in recent years, the group is still among the most respected and trusted brands in the country. But it is only recently the group began a concerted effort to protect and enhance its brand, which it acknowledges as its "most important asset," and which was valued at over Rs 10,000 crore four years ago.

"The Tata brand represents assurance, reliability, a sense of nationalism (and) value for money, irrespective of the product - whether it is a wrist watch, tea, salt, a piece of software or a car," said R. Gopalakrishnan, Executive Director, Tata Sons Ltd., at a press conference. "When you have an asset that size, you have to ensure that whatever you do enhances the asset's value, and also make it more relevant and contemporary on a continuous basis," adds Romit Chaterjee, Vice-President - Corporate Affairs, Tata Services.

In recent years, the group has designed a common logo, centralised its media buying and PR operations, devised a system for group companies to pay a fee for using the Tata name, and has aligned itself with vehicles that contemporarise the brand and connect with the youth. The group has committed Rs 300 crore over the next five years to target the younger demographic.

"Every brand needs to keep reinventing itself to keep up with the times - and a long-pedigreed company, especially, may fall into the trap of not constantly reinforcing the brand," says Madhuri Sapru, General Manager - Brand, Tata Services. "Over the last few years, the world has really opened up with globalisation, and there has been a change in people's mindsets. So it is necessary to re-evaluate where we stand," she says.

Towards this end, the Brand Equity Business Promotion Fund was created about four years ago; a Tata-name company, like Tata Steel, pays 2.5 per cent of its revenues to the fund, and a non-Tata name company, like Voltas, pays 0.01 per cent. The money is used to consistently enhance the brand image, Chaterjee says.

The group also undertook extensive research a few years ago; every six months, a brand track study, by Pathfinders, tracks brand perception vis-à-vis five other major corporate brands, among 5,000 respondents in 13 cities. The study plots the Tata brand against the others on two metrics, affinity (how close the brand is to the consumer, and how warmly it is perceived) and relevance (how relevant the brand is to the consumer's life). On both parameters, the Tata brand has risen steadily in value since December 2000, when the study was first commissioned, and continues to be ahead of the other brands, Chaterjee says.

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Two of the primary findings of the research were that the Tata brand is not perceived as youthful, and that it is not into technology in a big way. So there is a concerted effort to connect with the youth, and to communicate its involvement with technology, Sapru says. "There's been a lack of communication rather than a lack of activity," she clarifies.

Talking to the youth is really the need of the hour, says Sapru, who came on board about two-and-a-half years ago. "A person above 30-40 years of age has been growing up with the Tata brand, and has many touch-points with a Tata product or service, so the associations are far stronger," she says. "But today, it is a very brand-driven universe, and we need to ensure that amidst all the noise made by other brands, the perception of the Tata brand stays the same with the younger audience."

Young people are the "consumers, stakeholders and employees of tomorrow," and to connect with them, the group uses contemporary media such as the Internet and SMS, and events and personalities, Chaterjee says. Its stake in the Barista chain, for example, provides a popular venue to connect with the desired demographic, and the group has done interactive sessions with ace driver Narain Karthikeyan, a brand endorser, at sports bars and pubs in some cities.

Their research indicated that the three most effective vehicles to reach the youth are movies, music and entertainment, and sports. Movies were ruled out - although Marg, a Tata group company makes documentary films - but the group has associated with select music and entertainment events: it has sponsored a Shakti concert and one dedicated to Bob Dylan, and considers them big successes. The group will continue to associate with "contemporary classics, or contemporary legends" relevant to the Tata brand, Chaterjee says.

The group also signed a three-year title sponsorship deal for India's only ATP tournament, beginning 2002. Last year, it also signed on India's F-1 aspirant, Karthikeyan, to endorse some of its brands, including Titan's Fastrack. The $400,000 Tata Open provides a platform for a host of Tata products and services, including Titan, the Taj group of hotels, Tata Indicom and Trent's Westside. "We are trying to exemplify the `Tata One World' concept more and more, so any marketing activity is an integrated effort," Chaterjee says. "Tata and MTV is an unusual kind of combination, but this is how we are making ourselves relevant to the younger generation." The two have a deal to do some programmes on the Tata Open tournament.

In tennis and motor racing, the group has found very strong personality matches, Chaterjee adds. Formula Motor racing is about speed, energy, aggression, and fighting against tough international competition; tennis, too, is about speed, dynamism, aggression, and slugging it out against international competition in the tournament, he says.

When IMG, which owns and manages the ATP tournament, approached the Tata group after ITC pulled out of the sponsorship deal, the Tata management "asked all the right questions and were very diligent and straightforward,"

37

says Ravi Krishnan, Managing Director, IMG/TWI - South Asia and Senior International Vice-President, IMG. Given that this is a high-profile sporting event with a global, youthful image, it helps the company establish its new brand identity and reach a different audience. "The biggest annual global sporting event in the country and one of the biggest brands in the country - it's a very good fit," Krishnan says. "From the point of view of audiences, its employees, its sales force, the Government and the bureaucracy - the event brings the brand closer to them."

Another focus is B-school campuses, where the group is emphasising greater interactivity with students, and raising its profile as an employer. It sponsors the annual inter-collegiate event, Confluence, in IIM-A, and the Business Leadership Award; its senior managers also go on lecture tours and present case studies of group companies. "This is where we are going to get our future employees from, so we want to ensure the Tatas are in the consideration set, along with the consultancy firms and foreign banks," Chaterjee says.

In ORG-MARG's recent `Campustrack' survey of most preferred employers on B-school campuses, Hindustan Lever, Infosys and McKinsey headed the list of 48 corporates; Titan, Tata Engineering and Tata Steel were among the companies at the other end. However, Indian-family owned businesses in general did not fare <90,0><90>as well as multinationals, and the Campus Recruiter Index for the Tata group has improved since the last time, particularly for TCS, Tata Administrative Services and Tata Engineering, according to ORG-MARG.

The Tata group was rated highly on the parameters of "good standing in the market" and "large-sized company," and found to lag in the aspects of compensation/salary package, and international postings and overseas travel. "By all accounts, the image of a youthful, techie corporate seems to belong to TCS and, to some extent, to Tata Administrative Services. There is still some way to go before we can say this about the group as a whole," says ORG-MARG.

However, Chaterjee points out, the Tata group has climbed several notches in just a year, by making the brand "more relevant and more interesting as a potential employer in terms of what we stand for." Also, in the wake of the dotcom bust, qualities such as job stability and pedigree of the company have become more important, Sapru adds.

Internally, too, there has been a concerted effort to create a sense of synergy and belonging among the group companies. On the group's Intranet, there are forums for secretaries, HR managers, CFOs and others to share knowledge and best practices across companies and regions, Sapru says. The flip side of the coming together of the companies is that a negative fallout, like the Tata Finance debacle, can impact the image of the other group companies, too, warns Ramanujam Sridhar, CEO of brand consultancy, brand-comm.

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On the communications front, the group has integrated its activities: Media Edge is the group's AOR for media buying, and Vaishnavi Communications handles PR for the largest group companies. Brand experts say the Tata group is on the right track: today, the brand stands for trust and integrity, optimism and a dogged spirit to move ahead, says R. Sridhar, Partner, IDEAS-RS. "What is interesting is that some of the old Tata values are still there, but they don't make them weak or come in the way of progress," he says.

Indeed, while the 15-30 year demographic is in sharp focus, there is no desire to alienate older audiences, who continue to be valued customers, Sapru says. "We are not trying to suddenly become the Pepsi of the manufacturing world - we just also want to talk to the employee, the customer, and the decision-maker of tomorrow."

Brand-comm's Sridhar points out that the group has perhaps been seen as "an ageing patriarch, or a fuddy-duddy." But, with its increasing consumer focus, its realisation of the value of the Tata brand name, and its new product and service initiatives, there is "a sea-change from the `we also make steel' days: this is the new energy that is driving the group forward." Indeed, the company's Web site informs: "The Tata name is a unique asset representing leadership with trust. Leveraging this asset to enhance group synergy and becoming globally competitive is the route to sustained growth and long-term success."

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Case Study on Colgate – Palmolive (India)

Colgate-Palmolive is the World Leader in Oral Care with operations in over

200 countries. Colgate – Palmolive (India) Limited is India's leading provider of

scientifically proven oral care products with multiple benefits at various price

points. The range includes toothpastes, toothpowder and toothbrushes under

the "Colgate" brand, as well as a specialised range of dental therapies under

the banner of Colgate Oral Pharmaceuticals. These have become an essential

part of daily oral hygiene and therapeutic oral care in India. The Company

also provides a range of personal care products under the "Palmolive" brand

name. Being ranked as India's # 1 brand across all categories by the A&M-

MODE annual survey of India's Top Brands, it is always trying to maintain its

quality and aims at maximum customer satisfaction.

Colgate people working around the world share a commitment to three core

corporate values: Caring, Global Teamwork and Continuous Improvement.

Colgate has been rated the #1 brand across all categories in A&M's annual

survey of India's Top Brands conducted by Taylor

Nelson SofreshMODE. Powered by a rise in its brand

'POWER Score' from 53.91 in the last annual survey

to 56.2 in 2001, Colgate has been ranked the

country's #1 brand since the survey was introduced

in 1992.

Eight out of nine times COLGATE has emerged as

India's Top Brand. The survey shows a very strong

rural presence underlining the success of Colgate's distribution and marketing

Program.

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The Colgate anthem plays on …………

It makes me feel so good

Yes I know it should

Doesn’t matter how hard the quest

With Colgate-Palmolive I’m the best!

Stick together in every fight

Face the future smiling bright

Raise your hands so all can see

Number one’s the place to be!

We’re right on top

We’ll touch the sun

We’re right on top

We’re proud to be No. 1

We proved our mettle all throughout

We’re a great team without a doubt

Our success and you’ll agree,

Is because Colgate –Palmolive means You & Me!

I can take charge,

Of any problem, however large

Never mind about the rest,

With Mera Colgate, I’m with the best!

The C-P anthem voices the pride and sense of belonging, Palmolivers feel

towards the company. Developed as part of the Employer Branding initiative

(taken up by the Employer Brand team), the anthem was penned as part of

the communication campaign for the Best Place To Work (BPTW) survey. The

main objective of the anthem is to provide the “ organizational glue” which

bonds fellow C-P members and evokes feelings of pride in the company. The

anthem has received a favourable response from the employees and is

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played on all significant occasions when the entire team gathers together. It

has already been sung with gusto at the Intercoms and the launch of

conclusion of the BPTW survey.

It is a unique way of communicating the messages of pride and belonging

while encouraging Palmolivers to give their best. The anthem also stirs up

and motivates people by reinforcing the message of teamwork in facing

challenges and achieving goals.

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A Brief History Of Colgate

A Legend Is Born

The Colgate Story:

1806: William Colgate, sets up a starch, soap and candle business in New

York city.

1807: The company become Colgate 7 Smith with Francis Smith as partner

1813: The company name changed to William Colgate & Co. with brother

Bowles Colgate as partner.

1857: The founder William Colgate dies and the company became Colgate &

Co.

1937: Colgate Palmolive incorporated in India, launches Colgate Dental

Cream and became the company dedicated to the oral health of the nation. A

commitment rewarded with satisfaction, trust and goodwill of millions.

Today Colgate is India’s most trusted brand.

1937: Colgate-Palmolive (India) Pvt. Ltd. Was incorporated in 1937.

Introduced products that became market legends.

1937: Colgate Dental Cream was introduced.

1949: Colgate toothpowder and toothbrushes were launched.

1950: Palmolive shaving cream was launched.

1951: Halo shampoo was launched.

1952: Charmis cream was launched.

1967: Manufacturing operations commenced at Sewri, Mumbai.

1972: Colgate introduced a truly refreshing product – Palmolive After Shave

Lotion.

1976: Colgate launched the “Young India Program”… bright smiles become

brighter.

1978: The Indian public was offered 60% equity in the company, with shares

being listed on the Bombay Stock Exchange. Colgate Palmolive became a

blue chip company on the Indian bourses.

1988: Colgate relocated its toothpowder plant to Waluj, Aurangabad.

1989: Colgate invests in a state-of-the-art manufacturing plant for fatty acids

and soaps at the same location. Also, Palmolive Extra Care soap was

launched.

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1990: Colgate Gel was launched & brighter smiles followed. Also, Palmolive

Shave Foam was introduced.

1992: Colgate was rated as India’s No. 1 brand across all categories.

1993: Colgate Total – the most technologically advanced toothpaste was

launched. Colgate Palmolive USA reaffirms its commitment, by raising its

equity from 40% to 51%. Colgate was once again rated India’s No. 1 brand.

1994: Colgate Calciguard was launched. Once again the Annual Board Power

Survey ranked Colgate No. 1 across all categories for the 3rd succession year.

1995: Again No. 1 Brand for the 4th year.

1996: Colgate Oral Pharmaceutical products were launched in Asia-Pacific

region. This year, an ISO 9002 certification was awarded to Aurangabad fatty

acid, toilet soap and toothpowder plants. Again ranked No.1 brand for 5th

time.

1996: Colgate Palmolive entered a new category – household care, with the

launch of Axion dishwashing paste.

1997: Colgate Calciguard & Colgate Plus toothbrushes became the first to

receive the Indian Dental Association’s Seal of Acceptance.

1998: Colgate ranked No.1 brand for the 6th time.

1999: Colgate was rated “India’s Premier Brand” by A&M Magazine’s annual

survey of India’s Top Brands. This was a decade in which Colgate-Palmolive

introduced the best of its products in India. The Indian consumer was offered

top-of-the-line products.

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Brand Equity

ATTRIBUTE

A very generic brand. The word Colgate has taken place of the word

toothpaste. Example: In Gujarat, people call Close-Up as Lal Colgate (red

toothpaste) and they call Colgate Dental Cream as White Colgate (white

toothpaste)

BENEFITS

You don’t have to search for any other toothpaste.

VALUES

The three core values of Caring, Global Teamwork and Continuous

Improvement are put into action at work as well as in communities. The

results are better products and a better quality of life throughout the Colgate

world.

CULTURE

The Code of Conduct reinforces and enhances their corporate culture and

addresses issues of law, ethics and fairness in all their daily business

relationships.

PERSONALITY

Ranked 8 times as No. 1 Brand

USER

A 6 year young boy to 60 year old men in the family uses the brand.

LOGO

The face with a Colgate smile is the logo of the brand. The

face is shown as the globe with a Colgate smile over it, this

represents that the whole world should smile using Colgate.

This indicates a personal feeling in the mind of the consumer

and he is motivated to buy the product.

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COLOUR

Colgate has its logo colour combination of red, blue and white colours. They

have not changed the colour combination from the beginning as these 3

colours have left a mark (impression) in the mind of the people.

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Brand Loyalty

How did it win consumers?

The success lies in the satisfaction, trust and goodwill of their consumers.

They believe, that they can best serve the needs of consumers through a

consistent, fair and sensitive consumers communication program.

For that reason, Colgate has established Consumer Affairs in 31 locations

around the world - many of them with toll-free 800#s. The mission of

Consumer Affairs representatives who answer these phones is to:

Listen and learn about consumers in a professional, consistent and

caring manner that exceeds their expectations so that they experience

satisfaction with their products, in all respects.

Bring consumer feedback to the decision-making process at Colgate to

help improve existing products and develop new products that will meet

consumer needs.

The Consumer Affairs Department in India is staffed with

professional representatives who are knowledgeable about

Colgate-Palmolive products and welcome the opportunity to

hear from consumers. To benefit the consumer they have in

place a Toll-free number and helpline.

Environment

The protection of the environment and the health and safety of

our customers, our people and the communities in which we live

and operate is an integral part of Colgate-Palmolive's mission to

become the best truly global consumer products company. We are

committed to conducting ourselves in a socially responsible

manner and to keeping our business operations environmentally

sound. It is our worldwide policy to manufacture and market our

products and operate our facilities so that we comply with or

exceed applicable environmental rules and regulations. The health

and safety of our customers, our employees, and the communities

in which we operate must be paramount in all we do.

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These concerns have been translated into the following guiding principles:

Products

Colgate-Palmolive will provide the public with safe and effective products and

will strive to produce products that have the lowest practical impact on the

environment.

Packaging

To reduce the impact of our product packaging on the environment, we will

work to improve the environmental compatibility of all our packaging

materials. Colgate endorses the worldwide hierarchy of solid waste

management: source reduction; recycling (including reuse); incineration; and

landfilling.

Facilities

Colgate-Palmolive is committed to the health and safety of our employees

and the communities in which we operate, as well as the protection of the

environment. We will establish and maintain programs for the operation and

design of our facilities that meet or exceed applicable environmental, health

and safety laws and regulations.

Business

Colgate-Palmolive will consider environmental, health and safety issues in all

significant business transactions, including acquisitions, divestitures,

discontinuance of operations, and entry into joint ventures. We will also act in

a responsible manner with respect to the environmental protection of the

lands under our management and ownership.

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Code Of Conduct

Colgate people around the world have built a reputation as a

successful company with the highest ethical standards.

Through living our values of Caring, Global Teamwork, and

Continuous Improvement, and adhering to the highest principles of integrity,

honor, and concern for the environment and others, they seek

to:

Provide safe and quality products of value to consumers

Increase shareholder value

Offer opportunities for personal and professional growth

to all Colgate people

Fulfill our corporate social responsibilities as a member of

the global community

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