The Indian electronics industry has predominantly been an importer of electronic materials, components and finished products. However, this is not an ideal situation and local manufacturing has to keep pace with the growing local demand. Manufacturers and channel partners, in particular, face a number of challenges when importing products. One of them is the challenge of building a brand despite importing the components and electronic products from different companies.
Essentially, there are two ways by which the import of products can go hand in hand with building a brand. First, there are a number of white box importers, who instead of becoming another cog in the wheel, want to become the wheel itself. Hence, they develop products that can help them differentiate themselves from the rest of the crowd, and even make brand look and perform better than the best. Second, there are companies that represent one or more foreign companies and distribute their products under its goodwill or brand.
Tuesday, August 31, 2010: How to build a brand
It takes almost three to four years to convert an imported product into a brand. And it is even more difficult to maintain your own brand name while dealing with imported products manufactured by different companies. One of the key challenges of the modern business is that there is almost nothing that your competitors can’t duplicate in a matter of weeks or months. If you have a great idea, you can be certain that somebody will copy it before long. And not only will they follow your lead, but they may also be able to do a better job or sell the product/service at a lower price. The question then becomes, “What competitive edge do I have to offer that cannot be copied by anyone else?” The answer? “Your brand,” says Vaibhav Shastri, CEO, Zen Mobile, a Delhi based branded mobile handset company. The company has been importing its handsets from China. Currently, it has invested a large sum of money on brand promotion and visibility.
“A brand is the one thing you can own that nobody can take away from you,” says Rohit Agarwal, CEO, Pine Mobiles. “Everything else, they can steal. They can even steal your trade secrets. Eventually, your patents will expire. Your physical plant will wear out. Technology will change. But your brand can go on and live. It creates a lasting value above and beyond all the other elements of your business,” he adds.
According to Suresh Nair, director, Leaptech Corporation, a Pune-based SMT supplier that represents major SMT companies like Pulse Co Ltd, Speedprint Technology Ltd, Keko Equipment, Tangteck, Omron Asia Pacific Pte Ltd, Schmidt Technology GMBH and Fonton Industrial Co Ltd, etc, “We promote our brand concurrently, while promoting our principals’ brands. Both go hand in hand. Our principals’ brand names are about the products, whereas our brand is about the customer relationship and service support.”
Sumitron Exports Pvt Ltd, a distributor that deals in imported equipment, tools, materials and components for electronics, electrical, telecom, automotive, medical and pharma industries, represent Hakko, Aven Tools, Kilews Industrial Co Ltd, Fisnar INC, Hellermann Tyton, Ideal Industries, etc, in India, says SK Jain, its managing director and CEO, “Though building a brand name while importing other products requires a lot of effort to establish and win customers’ confidence, we have achieved it by distributing quality products and providing good after sales support. Moreover, we deal in world class brands, which are best in the industry. We have full support from all our principals regarding quality, warranties and after sales support. This helps in increasing the goodwill or brand of our company.”
The need for a brand
Companies often err when they presume that branding is not very important for old businesses and only startups need to worry about it. In reality, branding is equally important for both newbies and established businesses as corporate branding strategies significantly help the company in creating a highly effective and well established corporate identity. “While trying to develop a brand name, a company must understand the needs of its customers and prospects, and this can easily be done by integrating one’s branding strategies with those of the company at every point of public contact,” says Shastri.
“Contrary to the thinking amongst small companies, branding goes beyond merely getting someone in your target market to choose you over the competitor. Branding for small companies should actually be about getting prospective clients to view you as the only solution provider to its problems,” says Nair.
“A company should be ready to spend about 10 and 20 per cent of its net sales to build a brand name. It depends on how you want to spend that kind of money. You cannot afford to spend less than that if you really want to build brands,” says Agarwal.
After importing a product, the next challenge for any importer is to build an ecosystem around the product. Besides good advertising and presence, for any brand to get established in the market, it needs a good product and service. “From the beginning, when the Amptek brand was introduced in 2005, we started our brand building campaign. Simultaneously, we worked on appointing more dealers, distributors and entering the OEM sector, thus making our presence felt among the probable customers,” says Kapil Sood, CEO, Fusion Power Systems. The company is an importer and distributor for all kinds of rechargeable batteries and it specialises in rechargeable sealed lead acid batteries.
“We gave our customers the best quality and after sales services, which helped us create a good brand name, which is synonymous with quality and reliability. We must say that it took 3-4 years to establish the brand, and presently our brand has a good image,” says Kapil Sood.
The major challenge in brand building is getting the new entrants in the industry, who have no knowledge about the brand’s availability in the market, to become familiar with your brand. Moreover, reaching out to new customers and promoting the brand is a challenge in itself, feels Nair.
“Our brands speak for themselves. They are in great demand for their quality and competitive price. We have to face some competition from some of the cheaper products available in the market, which are no match to the quality and after sales service provided by Sumitron,” emphasises Jain.
While positioning a product as a brand, it is imperative to have a more holistic approach and start building products that have a wider market. Moreover, one should not try to compete on price alone, and the focus should be to build products with features that the competitor cannot boast of.
Customer faith is must
Branding today is the success mantra for every business, and particularly for startups. There is no doubt whatsoever that an effective brand name, combined with a well known corporate image, usually allows a company to charge more for its products and thus increase its profit margins. No one can deny the fact that a brand’s value reflects how a product’s name or a company’s name is perceived by the market.
For products like rechargeable batteries and LED lighting products that need warranties and prompt after sales service, customers prefer to buy brands that are readily available and serviceable. “Over the years, we have established ourselves as a brand that offers the quality and service of any international brand, for a very reasonable price. Customers have more faith in our brand than in those of our principals,” says Kapil Sood.
Advantages of building your brand
There is no proven disadvantage in promoting your own brand. On the contrary, there are innumerable advantages. For instance, brand building drastically reduces marketing investments, facilitates long range planning, enables your product to command a premium, builds higher entry barriers, increases cash flow efficiency and value of the business and intensifies customer loyalty. “Strong brands create a sense of individuality and separateness in the market, so that customers can easily differentiate your company from your competitors. The branding process allows you to take control of your corporate identity and influence the perception others will have about you and the services you offer. Lastly, a strong personal brand will enable you to effortlessly attract clients and opportunities,” signs off Kapil Sood.
Elements of Brand Ecosystems
- Conduct brand audit
- Develop vision, mission, value proposition
- Identify brand essence
- Create positioning and messaging
- Develop corporate identity and visual identity systems
- Build brand awareness, recognition an equity
- Design integrated, an external-internal campaign
Electronics Bazaar, South Asia’s No.1 Electronics B2B magazine