Developing cutting-edge brand strategies

The public sector can also practice ‘branding’ from an industry perspective

Taking wing to India for meetings is a usual routine for any business leader attached to a multinational in Sri Lanka, as most such organisations have their regional offices in India. Hence one has no option but to travel up and down for quarterly performance reviews.

One thing I have noticed over time has been that even with an outstanding performance on top line and bottom line, mentioning what business could have been if the north and east was open for business does not fly in a multinational culture. They expect the leadership to manage situations which are within the realm of control as well as outside.

However, last week when I received an invite from the Tamil Nadu trade chamber to present the ‘Evolving Sri Lankan SME scenario’ at an international conference in Chennai, the experience was very different.

Sri Lanka re-launched

The ethos of my presentation was that Sri Lanka was fast emerging as the tiger cub economy of South Asia with a booming stock exchange, GDP growth riding at 8.5% and the whole of the country was open for business, which caught the attention of the audience.

The reception post my presentation was quite glitzy. The Indian media wanted extracts and voice cuts whilst SMEs from India were inquiring on how to set up rice mills with investments of the tune of almost US$ 20 million.

If I am to pick one more, it was a commitment of 10 million dollars to set up a fish canning factory in the Atchuweli Industrial zone, which made Sri Lanka take centre stage at the conference. It was team performance led by the Minister of Industry and Commerce and I was proud to be a Sri Lankan.

It is when one travels overseas and represents the country, that one actually feels this new wave of attitude towards Sri Lanka. I am sure most private sector leadership have experienced this in the recent past.

India today

On the other hand, India was also experiencing a similar economic growth but was up against some key challenges like the post Commonwealth Games corruption scandal and the IPL saga coming to a loggerhead. The media was focused on the 30 day ultimatum that was dished out to the Kochi team for the season 4 of IPL.

Even though some have branded IPL as pyjama cricket, to me it’s a brand that has raised above the rest and has been valued at over US$ 2 billion by the UK-based valuation consultancy Brand Finance, whilst IPL as a brand is valued at over US$ 311 million.

Even though the games have lost their leader Modi, as per the Economic Times of India last week, the BCCI has estimated that IPL would bring in approximately US$ 1.6 billion revenue in the next five to 10 years, which gives us an idea of the consumer power behind this brand.

Let me try to capture some of the lessons from IPL in developing cutting edge brand marketing not only to the private sector but also the public sector.

Lesson 1 – Cutting edge decisions

The concept of selling cricket stars for big money auctions can be termed shrewd, but I believe it was the cutting edge decision that changed the nature of the game. In the first edition I remember there was a lot of money in the offing but no one knew if this business of IPL would catch the world. The one man who saw the future was Lalit Modi, who was the Chief Commissioner of this brand.

Today the business is worth US$ 2 billion. In 2008 for instance the Bangladeshi seamer Musrafe Murtaza who commanded a base price of just US$ 50,000 at the auction ultimately traded off at a commanding US$ 600,000 which gives us an indication of the consumer power behind him. This tag alone catapults the value of the IPL brand to what it is today.

If I am to draw a parallel in Sri Lanka, I will pick the brand Daily FT. It has architectured the product in such way that it is basically a business paper of the private sector. The product is fashioned by the private sector whilst the quality controller, being the Editor of the paper, keeps the tone of the brand as per a set vision.

The brand has become so powerful that today that it has crossed the 108,000 readership mark and is a holy grail of the business executive. To me this is cutting edge brand management at its best.

I guess from a macro end, a parallel could be what Ceylon Tea is up against. A particular brand that I do not want to mention started its business with a single origin branding campaign on the theme 100% Ceylon Tea and over time reduced the component of Ceylon Tea and today the brand uses a multi origin combination and in fact has taken away the ‘Ceylon Tea’ proposition.

Hence, we will not have an option in the near future but move to developing a strategy, however unpalatable it is to the conservative thinkers of the industry. In other words we will also need to practice cutting edge brand marketing strategies from a macro perspective.

Lesson 2 – Move out of the safety net

Apparently the founder of the Modi Empire, Gujmal Modi, in 1932 had started the company with only Rs. 400 in his pocket and had to let go of the security of his parents and home. Today the company is within the largest conglomerates in India with joint ventures with some of the top company’s like Philip Morris, Estee Lauder, Revlon, Rank Xerox and Walt Disney to name a few.

A parallel in Sri Lanka is Orange Electricals, which had to take a new name from Clipsal within 48 hours due to an issue that arose internally. Today ‘Orange’ is one of the strongest brand names in Sri Lanka.

It moved out of the safety net and aggressive moved to take the high ground in the bulb business of the country. It won the gold for its efforts at this year’s Brand Excellence awards, which gives us indication of the power of local branding even in difficult times.

From a macro perspective I would single out the sheet rubber latex branded as ‘Lankaprene’. I strongly feel there is opportunity for Sri Lanka to brand its top end rubber as Lankaprene and thereby target the surgical gloves and condom industries in the United States.

The distribution network is yet intact and what is required is commitment from a policy perspective given that the private sector already has set up a company and from a supply end is ready to go global. Even though rubber is fetching high prices currently with Lankaprene, we have the potential to get an extra premium of around 30 per cent with a brand name.

Lesson 3 – Work closely with the Government

When the IPL Season 2 ran into tough terrain due to the Indian Government wanting to give priority to election from a security allocation perspective Lalit Modi very clearly made it known to the world that he would cooperate and not get into a ‘turf war’ even though billions of rupees were at stake.

This came from the upbringing from one of his mentors Sri Kumar Modi, who personally used to work closely with the Government of India and local State, which resulted in the company having the space to venture out to industries like silk mills, nylon and polyester threading, tyre and tube manufacturing and industrial leather to name a few, which borders on political power.

The relevance to Sri Lanka is that organisations cannot work in isolation, but have to be closely threaded to Government policy. This might require the organisations of today to recruit a person who has a new skills set. If corporate Sri Lanka does not do that, growth can be stunted.

From a macro end we see the apparel industry working very closely with the Government, a recent example being the ‘Ethically Manufactured’ proposition being showcased at the WWD CEO Summit in New York on 1 and 2 November.

The objective is to target the CEOs of top global retailers to understand that sourcing from Sri Lanka will give a cutting edge reason for a US consumer to come to its outlets as against a competitor.

Maybe Sri Lanka needs to develop an eyecatching logo on this proposition so that it can be carried as a tag on every piece of apparel that we ship to the world. This will make the proposition unique in the eyes of consumers than just retailers.

Lesson 4 – Drive one idea hard

When Lalit Modi decided to commercialise 20/20 cricket by launching the IPL brand, he believed that nothing was as powerful as an idea whose time had come. He passionately drove the idea when a few actually believed it. Today this is a $ 311 million brand.

I remember the day when it was announced that IPL could not be staged in India due to the Indian election. Lalit Modi took the high ground and said: “I am going to export this product to another market.”

The event that was staged in South Africa was a masterpiece. It was an Indian-African mix that attracted the President of South Africa to be the Chief Guest at the final, which tells us how hard this one single idea was driven.

I feel the implication to corporate Sri Lanka is that things will never be perfect but what is required is to grab the opportunities in the market place as they emerge. Munchee did this very well by focusing on the ‘Truly Sri Lankan’ brand proposition and overcame the melamine issue as well as the attack from the giant Indian brand Britannia to maintain its status quo as the most powerful Sri Lankan brand in the country. This is single minded focus with all the issues in the market place.

From a macro perspective, maybe Ceylon cinnamon can use this concept. After all Sri Lanka has a 90% plus market share globally. Some are not aware of this. This can be made a power brand, given that we have cut out a new HS code which differentiates us from the cassia that is being flooded into the global market.

The challenge is how Sri Lanka can take the high ground post 22 November by unleashing a Ceylon cinnamon branding strategy, globally sprucing up value addition.

Lesson 5 – Know your eyeballs

It may sound a whipped concept, but the reality is that IPL, just like any other consumer brand, is targeting your own brother or sister. They are your consumer. They are your eyeballs. When it came to the IPL, the competitors were the target consumers spending two hours at the gym working out, a group of friends enjoying an evening drink at a club or watching that favourite TV programme at home. Hence, the only way to lure them was to provide a carnival atmosphere with music, dancers and excitement with ruthless competitiveness that helped attract 40,000 eyeballs.

In Sri Lanka the parallel is the brand Diva washing powder, which understood the consumer insight and introduced a low priced washing powder converting laundry soap users to washing powder and winning 28% of households in Sri Lanka into this brand.

I guess from a macro end the parallel could be wildlife tourism. A recent study has revealed that Sri Lanka boasts the highest propensity of seeing wild animals. What is required is a strong policy to drive this to the key global markets where the eyeball attraction finds this concept interesting. The best example is the positioning Rwanda as a mountain gorilla viewing experience. Today, this happens to be the number one foreign exchange earner for the country.

Sri Lanka has the same potential to drive up ARR to $500 dollars plus from the current $88 only in this segment of business. I guess it’s only a matter of time when this new business takes ground in Sri Lanka.

Lesson 6 – Heavyweights behind you

Laith Modi got the best talent to back him. Be it Shahruk Khan or Priety Zinta or Dhoni at 1.5 million dollars, he got the best young lifestyle TV presenters to be the voice for IPL even though he is no more in the seat due to many corruption charges.

Apparently the franchisees were told to focus on the 10-12 year olds as they would be the target consumers of tomorrow and they also have the power to influence the family. The brand will have a revenue turnover of over 1.6 billion dollars in the next 10 years, which is the strength of the demand pull.

The best parallel to me in Sri Lanka is Cargills, which has revolutionised the shopping experience with its ‘Food City’ brand. It now has a set of farmers who are part of the extended community. The other day Anthony Page told me that the target was to open 100 more outlets and the investment required of US$ 3 billion would be recouped through internally generated money. The power of consumer pull!

From a macro end I would like to focus on the conferences and conventions business of South Asia targeted to Sri Lanka. Currently the BMICH is been renovated to attract this segment. In the near future I guess the World Trade Centre can also attract this segment if properly marketed. Once again we see how the commitment of the heavyweights is important for the future of this business.

Lesson 7 – Performance over reputation

A key success factor at IPL was that big names did not count. All that mattered was performance. In fact there were many instances where the top names of cricket were spectators. The winners were those with the right attitude with skill. Age was also not a barrier. Shane Warne proved it by being selected as the most valued player in Season 1.

In Sri Lanka, my pick from the corporate brands is Venival Soap. The herbal brand took away the consumers of the powerful beauty soaps, which indicates that a Sri Lankan consumer also picks brands that perform and not just on past reputation

From a macro end I admire the tea brand Dilmah, where the owners drive business strategy with much passion. The next generation is taking over the reins and I see how committed and ruthless the company is to driving high quality tea in the global tea industry. I wish I see this aggression among other sectors of business.

Conclusion

IPL is a case study of modern day marketing where guerrilla techniques of business work. But more importantly it tells us that with focus, even with a two year toddler, a $311 million dollar brand can be built.

The Government of India earned almost 16.2 million dollars as taxes and the BCCI is estimating a 1.6 billion dollar in the next 10 years. This proves that brand value indicates the future monies that can be earned by a company. This I guess is why one of my bosses once told me: “Brands are the lifeblood of an organisation.”

Now the challenge is how we make Sri Lanka absorb these concepts and thereby become the tiger cub economy of South Asia from a macro end.

(The author is an award winning business personality securing twice the ‘Marketing Achiever award in Sri Lanka, Business Achiever from PIM Alumni University of Sri Jayewardenepura and a Global performance award from the multinational Johnson-Lever. Rohantha is currently the Head of National Portfolio Development for the United Nations for Sri Lanka and Maldives based in Sri Lanka. The above thoughts are strictly his personal views.)