It is not difficult to see the reason behind the overhaul. Every marketer wants to maximise the ticket size (value of bill), ensure that consumers spend more time at the outlets and most importantly, find newer occasions to come back to these brands.
If the core value of a brand is based on attributes or an experience then you can stretch it to some extent. But a pizza outlet does not necessarily compete only with other pizza chains, but with the entire category of eating out.
So, if an average family eats out 10 times, it is likely to visit an outlet that serves only pizzas on two-or-three occasions. That means a 70% opportunity loss for an exclusive pizza chain. Going by that logic, there would be only multi-cuisine restaurants around the world. But consultants back the decision.
Brands enter adjacent categories to complete the picture and to add-on certain missing dimensions of equity. However, such extensions are unlike the conventional toilet soap brands foraying into shampoos or vice versa.
Hence, while foraying beyond their core, the synonymous brands also take up a plank that is much larger than their flagship categories. So, The MobileStore focus is to go beyond mobile phones, to embrace mobility as a whole, Crossword is not about books, but about “education, entertainment and enlightenment”.
Coffee Day’s core value is based on ‘collective fun over coffee’ helps in stretching the brand into food, beverages and even merchandise. Their new initiative will help us differentiate from the branded fast food space and move to the affordable casual dining space. Others subscribe to that logic too.
The MobileStore is one of them and they extend their offerings to anything in the realm of mobility without watering down their core. That is why the company’s choice to retail gaming devices, MP3 music players and so on.
But while one may pick the right positioning, it is also very important to pick the right products to offer under the brand. Take the case of book retailer, Crossword.
As loyal customers walk into its outlets once in two months, the chain decided to give its customers more reasons to visit its stores. Hence, the store chose stationery, toys, music and movies. Demand for music is declining steadily, while movie retailing has been relatively flat. So the chain is looking at steadily increasing its presence in areas like gifting.
Gifting as a segment has not yet been fully explored. The demand for products like writing instruments has been constantly growing in the last three years. Citing the example for premium writing instruments, the average spend for writing instruments is Rs 1,200 as compared to the average bill size of Rs 568.
Writing instruments will also ensure that men have more reasons to walk in to the outlet, considering that nearly 55% of Crossword’s clientele are women. However Crossword also has had its share of failures while trying to enter non-book streams. For example, an attempt to retail chocolates in a tie-up with Cadbury was anything but a sweet experience.
The pilferage was high, plus Crosswords forte is not in selling chocolates adding that the format has also resisted the temptation to introduce wine and cheese counters inside the book-store. They could not take a chance where their customers could get annoyed with the brand.
That is the rider which is attached to such an exercise, which these brands are well aware of. Partly because of their brand names, these brands become so generic to their category that they fall into the consideration set only when consumers think of say pizzas, coffee, mobiles or books.
So, for buying gaming devices like the Microsoft Xbox, outlets like The MobileStore would certainly not be the first spot, consumers would think of checking out.
Even as these brands experiment with adjacencies only time will tell whether the move has been successful or not. Brands becoming synonymous to the category may not be a marketer’s dream.
The essential threats are that if a brand becomes generic, it will never be perceived as unique, relevant and differentiated. Consumers may never know the real thing. So what’s the real thing at Café Coffee Day? Coffee, Tea or other eatables.