HOW DO BRANDS WIELD THEIR MAGIC TOUCH ON THEIR OWNERS AND CONSUMERS?
The two laws of brand are quite interesting. The first law pronounces “The bigger the brand, the more is total spent on marketing” and the second law is ” the bigger the brand is the less in Unit Cost terms is spent on marketing.” This gives rise to the triple leverage effect of brands on high volumes (higher asset use and economies of scale), higher price (at consumer level and more so at retailer or distributor level) and lower Unit Costs in R& D, Production, Marketing (Sourcing and operating advantage). The result is that the brand leader’s market share advantage is substantially magnified at the profit level. It is not unusual for a brand leader having three times the market share of immediate follower to get six times higher profit! WEAR SOMEONE ELSE’S NAME ON YOUR BACK AND QUICKLY BECOME SOMEBODY YOUR SELF! Now let us see the joy of the consumers. Brand names- obsessed executives are spending big money on big Brands. Any doubt? Look at the favourite of some Indian executives. Van
