A while ago,
the folks at NIFT (National Institute of Fashion Technology) asked
me to sit on a jury to evaluate the work of their graduating
class. One of the questions I asked the students was what they
dreamt of achieving in the futureÖ
students said theyíd love to build and own their own brands, but
quickly added ďthat, of course, is impossible. It costs 15 crores
to build a brand.Ē They had picked up this figure from an article
in a major newspaper.
That is just not true. It
really made me sad to see their dreams being compromised by
someone writing on a subject he or she doesn't know enough about.
build a brand. Yes, you.
I am writing this to tell everyone with a dream that you can
aspire to build a brand.
It is as feasible for a small, new business to start building a
brand name as it is for a large multinational. The passionate
entrepreneur actually has many advantages over his larger
Unfortunately the concept
of branding has come to be associated with big expenditure Ė not affordable by
small/new businesses. This comes from the mistaken belief that
branding is the same thing as advertising.
This isnít so.
Advertising is a tool that assists in the process of branding
but is no means the only or the most important, or even an
Branding doesn't equal advertising
Branding isnít expensive, advertising is.
Not only can brands be
created without advertising, they can be created with almost no
dedicated expenditure at all. Every small entrepreneur can aspire
to create and grow a major brand. In fact, that's how most of
todayís mega-brands started.
This isn't a theory. See how the biggies started
Look at history. Think of some of the biggest
international brands Ė Coke, Levis, Liptonís, for example. Each
started very small and became very strong local brands in their
cities before they went out and
captured the world.
They started with an
innovative and good product offering, built enormous goodwill
amongst their first customers and leveraged that goodwill to grow
into larger markets.
Their expansion was almost
always driven by recommendations from existing customers to their
friends. This very goodwill caused geographical expansion to take
When their local successes
allowed them to start looking outwards, they began to use
advertising to speed up the process of creating awareness in newer
Branding is actually quite easy
Here is a simple formula for any small, new business to begin the
journey to becoming an international mega-brand:
Make a great product or
Present it attractively
to a small audience
Earn their goodwill and
admiration; they themselves will bring you new custom
recommendation carries a hundred times the weight of advertising
Keep fulfilling and
bettering the expectations of your core customer group, and your
fame and brand will grow
When this has allowed
you to earn enough to advertise, do so to expand your market.
Often, you will not even need to.
The goodwill you have earned will bring expansion opportunities to your doorstep.
Large companies have huge
overheads. So when they launch a new product they have to produce
a large result very quickly to justify their investment.
Thatís why they need
advertising to achieve awareness and trial very quickly. They
donít have a choice.
As a small player you actually have an advantage
But if you are fortunate enough to have the luxury of
time, and if your overheads arenít killing you, you donít need to
be in such a tearing hurry. You can afford to start slow and earn
the respect of a few consumers who will go on to become your brand
Learning is a
process that involves making mistakes. That is a luxury big
companies often don't have. You do. Be honest and transparent and
treat your customers with respect and you'll be amazed to discover
how much they will tolerate and forgive you for.
Examine the last
10 purchases you made, particularly the more expensive and
critical things or services you bought. How many of those choices
were driven by advertising? And how many were driven by a friend's
But it is critical to understand what it means
When you peel away all the jargon, a brand is only a
word and/or a symbol that is recognised by people to indicate the
availability of a particular product or service from a particular
What really matters is how
much liking, respect and trust that name connotes. The value of a
brand is measured by the number of customers who are likely to
come back to buy it again. This denotes how much future business
that name can generate.
If there is a vegetable
vendor you are prepared to travel a distance to buy from, a
hairdresser you will not deviate from, a restaurant whose sambhar
no one else can match, these are important brands in your mind. As
meaningful to you as Colgate and Coke and Mercedes and Rolex.
The entire branding
transaction is complete here. There is a name that you associate
with some qualities that you appreciate enough to keep going back
to that entity even if others offer the same products or services.
The assurance that you will go back again is value that can be
measured in hard cash!
value does it denote? There are many ways of measuring the value
of brands but all of them are based on the assurance of future
business because of the goodwill earned in the past or present.
is only for expensive stuff?
(particularly advertising and marketing people in lesser developed
markets) assume that being able to command a higher price is a
sign of a successful brand. I donít agree with this point of view.
Branding is not about prices at all Ė it is about the value that
you, as a consumer, perceive that you derive from the transaction.
You are the sole determinant of what you consider an appropriate
price to pay for it.
Let us say youíve been
going to a hairdresser you are very satisfied with and he raises
his prices by 10%. Would you shift? I imagine this will really
depend on how much value you perceive you are getting from this
guy. There are some customers who will happily accept a raise of
100% while some may not even tolerate a 1% rise. It isnít about
the extra money he wants, it all about what you perceive his value
I hope I have succeeded in
making the point that brands are not just packaged goods from
large companies. A brand is a relationship; an accumulation of
goodwill that leads to a future sale.
So, when a small
entrepreneur enters a new business, it is completely legitimate
for him to want to build a brand.
Branding is critical for the small guy.
In fact, it is the only way a small new business can
If he doesnít have
branding in mind, chances are he will focus only on selling
cheaper. This is a mistake many small entrepreneurs make Ė
thinking a lower price is an unbeatable sales story. It isnít. The
pricing battle is one that has no winners. Very large companies
can afford to play predatory pricing games, but the small guy who
tries it usually ends up committing hara-kiri.
Price v/s Value
I know a
guy who decided he would sell the cheapest jeans in Gujarat. He
actually believed he would sell lakhs of jeans and that his
product would drive all the others from the market. I told him he
was nuts, but that didnít seem to phase him. Its now been more
than 10 years and he barely sells (with great difficulty) a few
hundred units a month.
Why? His jeans are awful
value. His quality is poor and his work is careless. He assumes
that because he is selling cheap his customers will tolerate the
junk he delivers. He still hasnít realized a low price doesnít
substitute value. He is the cheapest, but his jeans are very poor
value even at that price.
Donít get me wrong.
Pricing is important, but it isnít the only value you should seek
to deliver. Someone is paying you money in return for some
satisfaction he or she wants, and when you take their money, it is
your responsibility to deliver the best value you can. This isnít
achieved only through high cost inputs. As a manufacturer I have
discovered the cost of making an excellent product and a lousy one
isnít really very different. Care and honesty donít cost that much
money, but they do demand commitment, honesty and discipline.
Brands represent safety
If you live in a city like Mumbai or Delhi where you have many
clothing export companies,
you see many export surplus garments being sold in small shops and
on the pavements.
Many people who find them attractive still prefer to buy branded
merchandise from reputed stores, because they are uncertain about
how well these incredibly cheap clothes will behave when washed
But you know who
buys them? Folks like me who know enough about fabrics and sewing
to have no such uncertainties. I know enough about the subject to
evaluate quality without looking at the brand name. Many of my
favourite clothes were bought off the pavements. But I can know
only about one subject. If it came to food, for example, I'd feel
safer buying a known brand.
It is important
to understand that this is branding' primary function - to
reassure the customer that his money is not being spent on a risky
The key word for
a successful brand is not fame, but trust. Of course both feed
each other, but trust is the more important element.
Size isnít the issue and
neither is advertising. What matters is being very clear about who
your consumer is, being very sensitive to what exactly sheís
looking or and doing your utmost to make sure she gets that, and
oodles more. Keep doing that, and youíll soon have a brand. Do you need a
lot of market research to establish that? It helps to research,
but your gut-feel as a consumer yourself will tell you what you
would have considered value and if you are honest with yourself,
this in itself tells you a lot. Keep talking to your consumers,
listen hard and read between the lines and you will know plenty to
How big can your brand be?
Well, imagine if you start with just 50 customers, who are
thrilled and recommend you to 3 friends each, and this
recommendation cycle continuesÖ do some calculationsÖthis quickly
leads to very large numbers.
Sounds silly? See
http://www.badlani.com/bags/customers.htm -these nice folks do
refer their friends, and their comments being here does influence
What happens when you want
to buy a big ticket item? They can blast zillions of dollars worth
of advertising at you and most of the time one negative remark
from a friend nullifies it. Works both ways. Zero advertising.
Friend raving about your product. You're likely to buy aren't you?
When your customers come
back and recommend you to their friends, you are on your way.
Earning and accumulating goodwill is the name of the game.
What's love got to do with
With this understood as being the critical factor, you will
appreciate that it is often easier for a small entrepreneur to
understand his customers than for a large, emotionally less
involved organisation. Because he is closer to them.
Yes, I am simplifying
things a bit. Branding does involve specialist skills, but if you
are earning and retaining goodwill you are way ahead of the game
and will soon be able to afford to bring in the branding inputs
you need (not an advertising agency. That comes later, if at all).
There are many folks like
me who do offer expertise. It is available, and neednít cost much
at all. There is also a lot of reading material available
completely free of cost, written by people who have learned their
lessons on the ground. If you do your homework, you will soon know
enough to do a very good job yourself. Bring experts in when you
can afford them. At the beginning, follow the basics and you will
have a good chance of succeeding.
So, when I next go to a
jury at the NIFT, Iím going to carry a copy of this note to tell
all those bright-eyed youngsters ďDonít be intimidated by what you
read in the papers. Its been written by people who donít know the
subject. Iíve done it, built a brand from scratch with no money at
all. So can youĒ.
Its bright-eyed youngsters
whose dreams build great nations. If reading this article
encourages just one person to start dreaming again, I think I will
have achieved something wonderful.
But haven't the big guys done
Nowhere near it. There are some things
they do that you can't match. But there are some things you can do
that they can't. How can an employee of a large corporation where
he is one of 27,000 people hope to match the passion of a group of
5 friends who are determined to conquer the world? A great deal of
branding is to do with passion, with that mad drive only
individuals and close knit groups can have.
Innovate. Play. Have the
courage to follow your convictions. All the answers havenít been
discovered yet. Your gut-feel is important and you must listen to
Did General Motors do
Microsoft or Google? They had all the money in the world and lots
of talented people, and a couple of geeks in a garage could do
what they couldn't have dreamt of. So dream, good buddy. If you
gut tells you there's another mother lode around the next corner,
there probably is.
But maybe its not around
the corner you think it is. Success isn't being right
all the time. Success is about being right more often than you are
wrong. You have to fail to be able to succeed. If you don't take
risks, how will you fail?
But that doesnít mean
being different just for the sake of being different.
I know this guy who wanted
to follow the Nirma example and build a mega detergent soap brand.
But he decided to be different in a rather irrelevant manner.
Instead of the traditional blue he decided to make a dark brown
soap. It bombed. Speculate why by asking yourself whether youíd
like to buy a dark brown detergent soap. He could have done some
inexpensive trials and research amongst maybe just 50 friends and
avoided an expensive mistake. Maybe he would have discovered a
meaningful way to differentiate himself. But for him to think
outside the box was absolutely correct. You do, however, need to
verify how much value people perceive in your innovations. Find an
effective and relevant differentiator and you have a great
Email me your views
If you are looking for some free guidance, go ahead and ask. If I
can, I'll be happy to help free of charge. If I get the impression
you'd benefit more from paying and getting me to work in a
dedicated manner on your project I'll tell you.