Brand replay: Once-popular names re-work plans to make a comeback   

December 10, 2010

Encouraged by the positive growth indicators in India, foreign brands as well as some domestic names which were laid low in the past couple of years, are looking to jump back on the store shelves

A host of well known brands that were either struggling to get a foothold in India, or were lying low following the global financial crisis, are now trying to re-launch their products using the organised retail platform.

Among these names are Italian apparel maker Grotto SpA’s GAS, another Italian sportswear label Energie, UK’s shoes stylist Clarks, and once-popular household goods products by Kelvinator, Akai, Maharaja Whiteline and even Weston.

Each of these names had slipped back for different reasons. “Many of them put up stand-alone stores and chose unsuitable partners,” explains Jagdeep Kapur, chairman, Samsika Marketing Consultants. “Some of them priced their products inconveniently, and were struck badly during the slowdown. While some exited, others had to re-position themselves.”

Today, the situation has changed. Business is looking good over the past few quarters and urban markets once again promise better growth. “India is one of the fastest growing markets and a growing branded market. There is no doubt it merits a second look by these companies,” Mr Kapur said. So, quite a few companies are looking to make a comeback to capitalise on this situation.

Recently, Grotto SpA announced its re-entry through a fully-owned subsidiary Gas Jeans Private Ltd. It had exited after winding down a three-year-old partnership with Raymond Ltd. Italian super premium jeans brand Energie is being re-launched soon by Bangalore-based Arvind Lifestyle. C&J Clark International—the official suppliers of shoes to the British royal family—has returned through a joint venture with the Future Group, after stepping out of a tie-up with a distribution partner on the first attempt.

One analyst explained the strategy for these re-launches: “These brands will not go for standalone stores, but will look for shops within malls and big retail outlets, because these have higher footfalls. But it is unlikely that they would go for price-cuts and dilute their brand value.”

It’s quite a different ball game for some consumer durable players. Some ‘old’ brands like Electrolux, Kelvinator, Oscar, Maharaja Whiteline and even Japanese Akai, were were once household names, till giants like LG, Samsung and Sony pushed ahead.  Now they are banking on affordability, pricing their products much lower than their international peers.

“These brands are targeting shoppers in tier-II and tier-III towns, and so their aim is to make available quality products at a lower price. They are encouraged by the performance of the rural sector, where demand and sales of consumer durables have gone up,” said a marketing executive of Videocon, which is re-launching Kelvinator.

Brands like Sonodyne and Weston are partnering with Croma and eZone to market their products. Most of them are also expanding their product range to woo customers back. For example, Akai, known for its video and audio equipment, is adding microwave ovens. Another is Maharaja Whiteline; its mixers and juicers have been popular and now it plans to also make geysers and gas stoves.

The inspiration for this comeback, one analyst pointed out, may have come from the mobile phone sector, where a low-price brand like Micromax has taken on the world’s number one phone maker Nokia with some innovative features.

Hardly any one will commit on whether lower prices will revive the nostalgia for these once widely-bought brands. “It will turn out to be profitable for brands like Kelvinator, which always enjoyed a strong image. When strong brands make a comeback they are received well,” Mr Kapur said. “But others who may have diluted their image will have to work harder to rebuild the image and re-establish themselves. For them it will be a tough fight.”  — Shukti Sarma