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Beiersdorf
anyone? Never heard of it? Actually, few people outside Germany
would have heard of the consumer products company that traces its
history back to the late 19th century. You can't say the same thing
about its flagship brand Nivea that is present in some 19 product
categories in the 50 countries that were surveyed by A.C. Nielsen.
That puts the personal care and cosmetics brand on top of the firm's
list of global mega brand franchises.
Global mega brand what? And why are there some
obvious omissions from the lists that dot the next few pages? There's
no Coca-Cola. No Pepsi. No Microsoft. And what about Mercedes-Benz?
The answers to all those questions lie in definitions. A.C. Nielsen
researched over 200 consumer packaged goods brands-now you know
why Mercedes and Microsoft don't figure-from over 50 global companies.
And to be classified a global mega brand franchise the firm laid
down two criteria. One, " to be a mega brand franchise, a brand
had to have products that were marketed under the same brand name
in at least three different categories." (That ruled out the
cola guys). Two, "to be a global mega brand franchise, a brand
had to meet the brand franchise criteria above in at least three
of the five geographical regions; in addition the brand had to be
sold in at least 15 of the 50 countries studied." And oh yes,
a brand was "considered to be in a category only if three or
more countries identified it as being so". Tough criteria all,
but who said it was easy being a global mega brand?
 Nivea
For the first 19 years of its existence-the skin cream
was launched in 1911-Nivea was present in only one category.
Today, it is present in 19 globally, all in the personal care
domain-from skin care to facial care to hair care to shaving
to bathing to baby care to sun care.
While the brand's early extensions were logical (Nivea sun
care lotion was launched in the 1930s), by the 1990s, the
company that owns Nivea, Beiersdorf, was confident that the
brand's appeal would work in categories such as hairstyling
and cosmetics. The company was right.
 Nestle
As anyone in the know will undoubtedly tell you, trust
matters in the foods business. Expectedly, 15 of the 23 global
mega brand franchises in this segment boast derivatives of
the manufacturer's name, if not the exact name itself. Nestle
is the best known of them all and is present in 15 categories
globally - from baby formula to chocolate to milk products
to desserts to ice cream. Indeed, the company is so confident
of its brand that when acquisitions have brought new brands
into the corporate portfolio-Carnation and Rowntree, for instance
-it has wasted no time in adding the corporate brand name
as a sort of umbrella tag.
 Across
Product Areas
Some global mega brand franchises are powerful enough
to transcend entire product-families. Colgate-Palmolive's
Palmolive is present in personal care categories such as bath
and shower, shave, toilet soap, shampoo, and deodorant, and
in home care categories such as auto and hand dishwashing
products. A.C. Nielsen says the company extended the benefits
of Palmolive-it benefits and cleans your skin-to the other
categories. Its dishwashing detergent, for instance, sells
on the premise that it benefits your skin even as it cleans
your dishes. P&G leveraged the "gentle and pure"
attributes of its toilet soap Ivory to extend the brand into
homecare products with the launch of laundry detergents and
dishwashing products. And Novartis has leveraged Gerber's
expertise in baby care to extend the brand across personal
care, food and beverages, confectionery, even healthcare.
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Who's Global? Who's Not? And Why
Of the 62 brands that met A.C. Nielsen's criteria,
32 were from the personal care and cosmetics categories. Food, beverages
and confectionery accounted for 23; home care, three; and healthcare
and pet care, one each. While no two global mega brand franchises
have taken the same route to universality, there are some common
strategic marketing threads across all.
Reinforcing the brand as expert: Some brands
have strong associations with the categories in which they are present.
Consumers perceive these brands to possess expertise relevant to
these categories. By extending the brand to other categories that
can benefit from this expertise, companies can reinforce the consumer's
brand perception.
Gerber, for instance, has a strong association
with babies, which it has leveraged to great effect-today, a wide
variety of products targeting babies and toddlers are branded Gerber
Maximising consumer trust in the corporate
name: 22 of the 62 global mega brand franchises use the company's
name or some form of it. Evidently, companies use the equity surrounding
their brand to extend it to other product categories
Extending brands representing lifestyles: Some
brands reflect consumers' lifestyle needs. Companies can successfully
extend these across categories that benefit from this lifestyle
image.
Licensing the brand name: Some companies license
their brand names to manufacturers outside their own industries
and areas of expertise. This enables them to extend their brand
name into alternative product categories.
Interestingly, the A.C. Nielsen survey found
that most companies began their brand franchise expansion campaigns
at home. However, there have been cases where companies have successfully
grown the brand into new categories outside the home country.
The India Angle
When A.C. Nielsen ORG-MARG compiled a list of
brands available in the Indian market, owned by both Indian companies
and multinationals, we were in for a few surprises.
Nivea, the global #1 in the survey, came in
at # 19, although if only multinational brands were concerned its
position was a more respectable #5. On top of the list of global
brands was multinational-owned local brand Lakme that is present
across 12 categories. For the record, the multinational brand present
across most categories in India is Revlon (10).
The presence of more-Indian-than-Indian brands
such as Ayurvedic Concepts, Biotique, Amul, Baidyanath, and Hipolin
in the listing (See India's Mega Brand Franchise (Local) on page
93) is probably an indication of how well some Indian companies
have been able to leverage the corporate brand across categories.
Equally, it could well be a measure of the
financial and other costs involved in building new brands in India-something
that encourages companies to be more pre-disposed to extending their
corporate brands across categories.
The strangest absence of them all in the Indian
survey is that of Nestle. The company has several big brands in
India (Maggi, Sunrise, Nescafe) but none of these, other than Nescafe,
which is a derivative of Nestle, have anything to do with the corporate
name. Still, the non-corporate approach has worked for the company
in India. Last word: Global mega brand franchises matter, but there
is life beyond them.
What's In A Name?
Sujit Das Munshi, Executive Director and
Vice President A.C. Nielsen ORG-MARG |
 The
intent of the global mega brand franchises study is to identify
those brands that have used the same brandname across a wide
range of categories and countries. If, for instance, sales dollars
and rupees were used as a criterion, a brand that was big in
one category, and small in 10 other categories, could overshadow
a brand that was equally spread out across 11 categories.
Our intent was not to identify which
brand is the biggest from a sales standpoint but those brands
that have developed their brandname across geographies (domestically
and globally) and categories.
In order to qualify as a global mega
brand franchise, the brand name had to be used in a consistent
way across at least three categories and three regions at
a global level. A brand would only be considered active in
a category if at least three countries identified it as being
so. As you will see from the final list of 62 brands that
the global mega brand franchises identified are some of the
biggest names in fast-moving consumer packaged goods.
Brands within the Indian sub-continent
span diverse categories across a country fragmented by language
and culture. This in itself is testament to the power of these
brands and the marketing acumen of their owners.
The category that is the most symptomatic
of the power of mega brand franchises is personal care. Within
personal care, there are related, "natural" groupings
of products. For example, if a consumer is to buy a toothbrush,
he or she is also likely to buy toothpaste, mouthwash and
dental floss; if a consumer is to buy a razor, shaving foam/gel
and after shave are also likely to be purchased.
Manufacturers seem to build their product
ranges based on these related "natural"
groupings. In the food category, there are some related "natural"
groupings, cookies and crackers, for example, but you would
not expect milk and cookies to be marketed under the same
brandname.
Food brands too can be ascribed similar
traits. Locally, Amul stands as a clear example where a related
'natural' grouping does occur because the brand stands for
a larger concept-i.e., dairy products (from bread spreads
to ice creams, spanning an entire range of products).
This grouping facilitates a 'bundling
of complementary products' into product area-specific 'kits'
like 'childcare kits' by Johnson and Johnson or 'shaving kits'
by Gillette. Not only does this offer the brand visibility
across categories but it also helps marketers derive distribution
synergies that can be leveraged to make brands more profitable.
Within A.C. Nielsen's survey of global
mega brand franchise, expansion of the corporate name across
categories was seen to be considerable (22 of 62 brands were
derivatives of the corporate name). A manufacturer like Coca-Cola
is unlikely to use its corporate name across other food and
beverages categories since it has all along focused its brandname
on one particular carbonated beverage.
The consumer links the Coca-Cola name
to cola-based products and this has been a successful strategy
for Coca-Cola. The Coca-Cola brandname has, however, been
used to sell non-beverage products-clothing, glasses, phones,
clocks, bags.... all categories outside of A.C. Nielsen's
global coverage. The Coca-Cola Company has other brands that
have been extended across the food and beverages category.
For example, Minute Maid in North America is found within
juices, concentrated drinks and ice cream/novelties.
Home And Away
The 31 manufacturers, which own the 62
global mega brand franchises identified in the A.C. Nielsen
study, are some of the most global manufacturers in the fast-moving
consumer goods (FMCG) arena.
It is important to remember that the
globalisation of many FMCG companies began with these companies
using those brands that made them successful at home and expanding
it to other countries. But once this global expansion occurs,
manufacturers are constantly evaluating new brands as they
are introduced in local markets around the world and expanding
those that are successful and have widespread cultural appeal.
Successful ideas don't always begin at home as in the case
of Unilever/Dove.
The criteria set by A.C. Nielsen's study
of global mega brand franchise was based on breadth in both
geography and categories. Launching a brand across multiple
categories usually begins with successfully establishing the
brandname and image within one category and then expanding
to related categories over time.
Geographical expansion is based on a
similar premise...if a brand is successful in one part of
the world; it is then expanded to other geographies. Most
brands are generally not launched across multiple categories
(or countries). Establishing success in a category or a geography
is usually the beginning. A global mega brand franchise is
then developed over time.
Not all successful brandnames, even if
they have considerable geographical presence, are destined
for expansion into new categories. Some manufacturers have
taken a more focused branding approach. For example, the Coca-Cola
brand in carbonated cola beverages. By remaining focused,
consumers are then able to clearly relate the brand to the
category.
If consumers think "cola" when
they think Coca-Cola, then an extension into orange drink
or milk would probably not be appropriate. What image the
brand has in the minds of the consumer is a link to the brand
potential for extension. A number of the home care categories
are quite distinct from each other-for example, fresheners
vs pest control. With such different applications, consumers
could become confused if a brandname were extended across
these categories. Language also plays a part in this situation.
If a brandname is developed because it stands for "clean"
or "fresh", for instance, the extendibility to another
language may not exist.
Global players such as S.C. Johnson,
for example, have launched exactly the same products around
the world with local brandnames; Glade, for example, is known
as Brise in some countries like France and Spain.
Gerber seems a very interesting phenomenon
in how it cuts across broad product areas-this may have something
to do with the universal appeal of nurturing babies.
The study identified Gerber as crossing
six categories and three product areas-personal care, food,
beverages and confectionery and healthcare. The Gerber brandname
has been developed to stand for products that meet the needs
of babies and toddlers. Although a very successful brand franchise,
the Gerber brand was not one of the most global brands within
the study as it was only found in 28 of the 50 countries studied.
Steady, But Costly
It takes considerable investment, in
time and money, for brands to meet the geographical and category
criteria set by the study. Manufacturers invest a great deal
of money in building a brand image, and as globalisation continues,
we believe that we will see more global mega brand franchises
develop whether in India or abroad.
Finally, the survey identified the L'Oréal
brandname as only one of the many brand franchises owned by
the L'Oréal company. Other brands include Garnier,
Maybelline and Vichy. All references in the charts make a
clear distinction between the brand owner and product brand,
even if the corporate name is used in both cases.
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