Amuleek Singh Bijral, MBA from Harvard University and former employee of EMC Corporation, opened “Chai Point” in Bangalore in 2010, where he was serving humble tea in glasses. Since then, he has opened 22 “Chai points” in Bangalore and 3 outlets in Delhi. Similarly, “Tapri” in Jaipur provides tea in a casual atmosphere. Young entrepreneurs are finding innovative ways to brand a commodity like humble “Chai”.
How can you brand a commodity, which is at the bottom of the branding ladder? Branding Ladder
- Differentiate your offering-consumer must perceive it differently like Taj Mahal Tea, Ashirwad Chakki fresh atta or Himalaya mineral water.
- Packaging is the key- visual appeal is critical. Consumers will prefer a branded commodity, only if there is visual appeal in packaging. Products like Captain Cooksalt, Parachute hair oil; Red label tea has redefined visual appeal.
- Pricing is strategic: consumers will be willing to pay a price premium of 15-25 % for a branded commodity, if you are able to create differentiation and thus value. You can still increase the price, if more value additions are given. Tea bags charge a different premium than the regular branded tea.
- Promotions will make a difference: Relevant promotions will drive the sales. Who can forget the Free Bucket promotion done by Surf detergent.? Promotions increase trials, trials increase usage-usage creates brands.
- Provide the Experience: you can charge more than, 10x for a commodity product if you deliver a great experience. Barista, café coffee day deliver a different experience through coffee.
- Brand transformation: when the brand is willing to go the extra mile, magic starts happening. Starbucks is an example, where the brand identifies different groups of customers, customizes the offer and delivers the product in a magical surrounding. This is the highest form of branding.