In conversation with R Balki, Chairman & CEO, LOWE, India
NDTV: It takes years for a product to become brand. What is it that a product needs to be able to build brand equity?
R Balki: It takes a damn good product to build brand equity. But to try it for the first time you need sales, you need an idea that excites people, the right packaging, the right pricing, news and information about the product.
NDTV: When a brand does get into controversy - what can it do to regain its equity? Especially when it involves a fraud?
R Balki: I think there are some categories where even though you know there is a scandal you are not really sure how true it is, you tend to give that product quite a bit of a chance because you like it so much. Some people do drop off but most people wait and watch and don't completely give up saying I won't touch this product anymore. They wait for tests etc. and anyway in a country like this where so many things are going wrong no one expects a product to be perfect. It's ok - couple of mistakes here and there happen. But you will get a hit because at that point in time there is caution but if you do the right things and are seen as a person who is out there to correct the mistakes you convince people you are ok, things get alright. But of course if the product is proven to be bad, it's a disaster for the brand.
They must have enough proof that they are safe - then if they are not they must quickly rectify it and sometimes brands can come out and say yes we made a mistake. Consumers actually like you for something like that. A lot of times they can say they are falsely accused. It could be done by competition. A lot of times things are not the truth - clearly say I didn't do this. It's a stray case like cockroach or fly in one bottle...it's ridiculous. It is also your tone of voice. If you sit back and think people will forget, that's the most dangerous thing to do. Take an aggressive stance. For colas it wasn't a very conclusive research - they actually did tests and proved reports wrong. Too much media, bad PR. It required people with stature to come out and say that's not the truth - the product is safe.
NDTV: Does a crisis with one brand also effect related brands? For example all chocolates or all IT companies?
R Balki: It does affect the industry, but you have companies like Infosys - pillar of morality. There is a question about are they really doing so well? So we don’t know if the man was bad or the company. Too much speculation but here it is much bigger than a consumer product where you spend 10 rupees. This will take a lot of continuous effort to keep proving to people. New board, rectify to get to the truth as soon as possible, new board to get on the front foot, to have investor confidence after a case like this, but it needs a lot of continuous efforts for a long time.