Necessity for re-branding:
- Acquisitions and mergers
- Brand currently does not have a distinct positioning in the market
- Brand’s PODs have been imitated by the competition
- There is a change/ addition in the value proposition
- Brand has got a negative image and is facing crisis in the market due to some recent incident
- Consumers/ channel do not trust the brand’s claim of offerings
Re-branding is a very costly and risky proposition. Therefore, company must formulate a strategy for re-branding after truly understanding the need for it. The distinct value proposition of the brand must be defined and translated to the most relevant benefit / problem alleviation offered to the consumer.
Let’s discuss the strategies on the basis of necessity of re-branding as follows:
Acquisitions and mergers:
The name of the stronger brand may be retained in this case or new brand name may be a combination of the two merging brands. For example, UltraTech Cement recently acquired Birla Gold Cement, Binani Cement and Jaypee Cement and the name of stronger brand, i.e. UltraTech was maintained. Similarly, J P Morghan Chase & Co was formed by after merger of Morgan & Co. and Chase Manhattan Corporation.
Brand currently does not have a distinct positioning in the market:
In this case, the marketer must find out the unique benefit being offered by the brand, which the competition is not offering. The benefit being offered must address the most burning need or problem of the consumer.
Brand’s PODs have been imitated by the competition:
It’s very difficult in today’s world of quick information flow and technological advancement, to maintain any important point of difference as unique offering. Competition acts fast to imitate your distinctive offering, if it is really very relevant to the customer’s needs. In such a case, carefully study the customer’s needs and problems (most probably a latent one) and communicate effectively how your product provides a solution to it, which competition does not provide.
There is a change/ addition in the value proposition:
If the brand has come up with an improved offering, the improvement must be communicated to the market through the selected vehicles of communication.
Brand has got a negative image and is facing crisis in the market due to some recent incident:
In this case, it is better to speak upfront on the issue that created negative image. Clarifications must be provided with facts if incorrect impression was formed in the market due to some confusion. In case, the reason leading to negative image was real, the steps taken to correct the issue must be elaborated. In both the cases, communications must be supported by evidence.
The role of customer communities and social media becomes very important in this case. The marketers must create an army of brand advocates, who shall highlight the measure taken by the company to address the issues. It is very important to have true and neutral customers and not the ‘bought’ ones, as there may be a severe backlash in the latter case.
Consumers/ channel do not trust the brand’s claim of offerings:
This may be due to under-performance of company’s products or not fulfilment of promises by the company. In such a case, company must improve the offerings and make sure that promises made to the consumer and channel are honoured.
To sum up, keeping in view the complications and very high cost associated with a high risk of not getting desired success, re-branding strategy needs to be formulated and carried out very carefully after analysing the need and overall business scenario.