Rethinking mass & exclusive brands.
It is not price-point or distribution, but control over brand experience.
Many a marketing battle has been fought over the idea of mass and exclusive brands. Self-proclaimed mass brand marketers speak in condescending tones and scoff at their colleagues who peddle elitist products. In turn, exclusive or high-end brand marketers are tempted to downgrade and offer a watered-down version of the brand which will appeal to the masses in hope of sales spikes.
The danger of adopting such simplistic and binary approaches is that it defines a mass brand only in terms of price point and distribution.
Price point is the most easily understood and widely used criteria to decode what is a mass brand and what is not. But in many cases, it fails to provide a complete explanation. Here’s why.
- There is no single price point below which a product becomes mass or above which it magically becomes exclusive. Prices vary vastly between categories. For example, some would argue that Louis Vuitton is relatively speaking, a mass brand compared to Bottega Veneta.
- Dynamic or Surge Pricing has made any price-based comparison redundant. The same room in a luxury resort can sell for as little as Rs 4,000 or as much as Rs 20,000 a night. With more brands using discounts to attract and invite newer segments of customers into their fold, price becomes a less reliable indicator of brand value.
- Even within the domains of the FMCG industry, a brand like Paperboat is perceived to be premium not so much for the slightly higher price point, but for the way in which it packages nostalgia-laced stories into the products.
Distribution or reach is the other common metric that comes up in this discussion. The more widely distributed a brand, the more ‘mass’ it gets. Rooted in the proud traditions of the FMCG industry, this notion of reaching out to a very large set of consumers spread out across a wide geography is visually very compelling and easily interpreted as a mass story.
- Digital channels of shopping have completely done away with this visual — each brand is theoretically available to everyone who is online or with access to a telephone line. Of-course this set may still represent a very small part of the population in some countries, but if you map the reach of a traditional distribution channel, other constraints such as local transportation, lack of pricing transparency, lesser choice etc. will surface.
If a brand is listed online and hence available to everyone, does it automatically become a mass brand?
- If a brand is listed online and hence available to everyone, does it automatically become a mass brand? Clearly, this is not the case. www.burberry.com has added dimensions to the brand that it otherwise would have lacked. www.farfetch.com offers a curated range of luxury products and brands online and ships worldwide.
Brands breaking these stereotypes
The concept of a marketplace challenges both the notions — of price and distribution — at once. Amazon sells products at prices from Rs 1 to perhaps Rs 100,000 and it is open round-the-clock. Does that make it a platform for mass brands? Or does its finely tuned targeting capabilities make it the best possible platform for exclusive brands? When you book an Uber-X and an Uber-Share through the same app, are you enjoying a mass or an exclusive experience?
And finally, the biggest elephant in every room — Apple. Over the years, Apple has increased its distribution footprint manifold. It is sold across multiple price points and the older versions sell at significant discounts. There is no longer a stereotypical Apple customer — they come from all walks of life. In spite of this Apple remains exclusive and aspirational.
So clearly, the mass vs. exclusive divide is not easily explained away. But this is not to imply that there is no difference either.
Controlled brand experiences vs. Diffused brand experiences
It is safe to assume that all brands operate within constraints of budgets and resources. Certain brands choose to carefully control and calibrate all aspects of the brand experience across the product lifecycle. This scope of control can widely vary — basis the number of touch points that the brand decides to focus on.
Designing the product story, the packaging, the channels of sale, the retail experience, the sales team training, after-sales service and communication are activities that all brands do. But a brand that chooses to carefully calibrate and control each of these elements becomes an exclusive brand. In other words, an exclusive brand carefully controls each aspect of how customers experience it.
Apple, in spite of a large distribution network is still a carefully controlled experience. Recently it decided to scale down its network in India to ensure that the experience was not getting diluted. Burberry.com is a digital extension of the physical store or vice versa.
Brand perception, just like other elements of brand craft is an outcome of careful choices rather than just an element of chance.
Calibrating each of these experiences comes at a cost. At times, it may not provide additional value to the customer or the brand. In such cases, the brand chooses to focus on its core attributes and willingly gives up control over the other touch points. As long as the core attributes are compelling, the brand continues to grow in strength and relevance. This gives rise to diffused brands.
It may help to imagine brands plotted against an increasing degree of control. This suggests that theoretically every brand could be an exclusive and experiential one. But the few that consciously choose to spend resources on controlling more touch points end up being remembered so.
Controlled brands offer a multi-layered experience. It is hard to articulate the individual role of each component of the Good Earth experience but clearly, each of them is important. On the other hand, a strong diffused brand has a highly differentiated core proposition — without which it will become a commodity. For example, Maruti in the 80s could sell cars based on fuel economy alone, but to attract customers now it needs to have a higher control on the brand experience. The Nexa stores are a great example of a brand trying to move towards greater control over its sales locations.
Adopting the vocabulary of a controlled vs. diffused brand eliminates the biases associated with the traditional mass vs. exclusive argument. As an idea, it is category, price point and distribution agnostic. Moreover, it underlines the fact that brand perception, just like other elements of brand craft is an outcome of careful choices rather than just an element of chance.
