Why is Volkswagen better than Tata Motors? Why is Colgate better than Babool? Why is Kellogg’s better than Mohan’s? It is not a co-incidence that foreign brands have higher equity when compared with Indian or Asian brands. The reason is that western brands have invested consciously on brand building for ages. For example, the India Head of BMW quoted last week that when they entered India they did not have to do any brand building because the public at large was not just aware of BMW but counted it amongst its most aspirational brands! Not surprising to me. Same would be said about Ferrari which is making its India debut. We already adore it. Starbucks will be entering India soon and its popularity amongst the discerning would be very high!
So, that’s the difference. While the foreign companies focussed on brand building which helped them go global, Indian and Asian big companies have struggled to make a name outside India. Even the 65 billion dollar Tata Group needed introduction to the western market when it acquired Jaguar and Land Rover. Similarly, Mahindra Motors which has recently launched its range of trucks in the US, is struggling to create a brand identity. On the other hand, foreign brands are revered in Asian markets and many travellers especially fly down to shop London and Singapore! So, why do Indian brands fail to create a brand identity vis-a-vis western brands. No 1, western companies, such as GE and HP, are old stalwarts which were nurtured on strong vision, and invested as much on awareness as products. No 2, Westerns companies have been there for ages and most of them enjoyed first mover advantage. No 3, Asian economies such as China and India, have been late bloomers where the focus was always on sales, and they lacked the quintessential sense of going global in future (even the telecom giant Airtel had to revamp its identity when it suddenly realised that going global would mean global communication; going global was realised late). No 4, Asian companies lack in vision/marketing/branding needs and are still old-fashioned in its way of working.
It’s only that big companies such as Godrej are waking up to practices such as Brand Audit and revamping to catch up with foreign brand invasion. However, having said that, now Indian brands are more futuristic and confident. Some like, the Aditya Birla Group, are choosing and out and out inorganic route to growth, while the likes of Reliance Industries are forming strategic mergers with BP to acquire technical prowess.