Transcript
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Brand Repositioning “If a brand does not reposition at theright time, it may not get a secondchance”.

CHAPTER 1 :INTRODUCTION

MEANING

In marketing, positioning has come to mean the process by which marketers try to

create an image or identity in the minds of their target market for its product,

brand, or organization.

Re-positioning involves changing the identity of a product, relative to the identity

of competing products, in the collective minds of the target market.

De-positioning involves attempting to change the identity of competing products,

relative to the identity of your own product, in the collective minds of the target

market.

Brand repositioning means rebirth of any brand for a particular product...relenshing

of the old technology or concept by innovative solution.Repositioning can be

required as the market changes and new opportunities occur. Through

repositioning the company can reach customers they never intended to reach in the

first place. If a brand has been established at the market for some time and wish to

change their image they can consider repositioning, although one of the hardest

actions in marketing is to reposition a familiar brand.

The repositioning strategy is rolled out in three stages: introductory, elaboration

and fortification stages. This involves the introduction of a new or a repositioned

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brand, seeking to underline the brand’s value over others, and to broaden the brand

proposition. It is truly tough to change the customer’s perceived attitude towards a

brand, and therefore the risk is great that the attempt to repositioning might be

unsuccessful.

After rolling out the strategy, it is time to modify the proposition through update

of the personality and through repositioning. There are benefits and risks with both

of this segments and it is of great significance that they are truly evaluated when

deciding the next step in the process.

THEORY & CONCEPT

Timely repositioning

Contemporary perception could involve Either the image or superior functional

utility. Iodex was almost the unassailable leader for

several years in the pain balm market but was forced to

reposition itself by Moov, which made rapid strides.

Dove is repositioning itself as a superior soap with moisturisers (as against its

previous `trial for results' positioning). Vim Challenge was a response to several

regional brands emerging in the dishwash market. Esteem's "Shall we go for a

drive, please?" campaign (where the son hopes his dad's pleasure at the ride in the

car will overshadow his poor marks) was triggered by the various offerings which

entered the mid-segment passenger car market.

If repositioning is not attempted by a brand in a timely manner, the brand may not

get a second chance. The powerful positioning of economy by the no-frills Maruti

800 during the mid-Eighties could have been

pre-empted by Ambassador, not necessarily by

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the same economy proposition: Ambassador even today is widely acknowledged as

a comfortable car for Indian roads and is also known for its space. Some of the

recent offerings in the passenger car market today use this as a strong proposition.

The brand could have used this effectively to create a favourable perception of

itself. Maruti 800 became almost a legend as much known for derailing Fiat and

Ambassador as it is for its fuel economy.

Even in fast moving consumer goods involving mundane household products,

timely repositioning matters. The Ujala brand of blue used to whiten clothes made

history with its liquid variant. The pioneering (and the brand which held the

dominance for years) Robin Blue had a powder variant before

Ujala was introduced. Powerfully repositioning Robin Blue

(even before introducing the liquid variant as a follower) might

have reduced the impact of the new entrant because of the

favour and trust Robin Blue enjoyed with consumers.

Burnol, the antiseptic cream for burns (it did attempt some sporadic repositioning

exercises) no longer seems to occupy the same space in the consumer's mind.

Women continue to cook as before and probably mostly in a

hurry to catch up with the pressures of life. Burnol being a

handy brand to overcome the inevitable small burns could have

been a probable proposition to reposition it.

With several categories jostling for consumer mindspace, there is a relevant

proposition required for a brand in the `small burns category' to get into the

considerations set of consumers. The timing of repositioning (in such cases) should

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be worked out to ensure that the category does not fade from the consumer's mind

because of a number of other categories emerging to create generic competition in

terms of the share of consumer's wallet.

For example, a brand traditionally used for burns may be forgotten because of

several categories of products and offerings like a cream for heels, herbal antiseptic

ones for multiple injuries and corn caps. Forhans toothpaste, Zambac and Saibal

multipurpose antiseptic ointments, Eno's for acidity relief, Waterbury's Compound

for `after-cough' recovery and Crook's Lactocalamine lotion are some of the brands

of yesteryear which could have maintained their dominance of the consumer's

memory with appropriate repositioning strategies.

Contemporary image

This matters in some categories which are conspicuous in terms of consumers'

usage and observation. With changing lifestyles and nuclear families in urban

markets (especially in the upmarket segments), the role of the male in the family is

undergoing a change. The `relationship' repositioning of Raymond is a good

example of a brand coming to grips with the changing psychographics of the target

segment. Fair and Lovely's repositioning as a brand for the aspiring girl making a

mark in a male-dominated world (woven around the cricket commentator

commercial) too is one such example. Pepsodent's commercial in which the mother

scolds her child for snacking and establishes the brand as a protector of teeth is

associated with traditional habits which have been highlighted to create a realistic

association between the brand and the target segment. Product/brand attribute

relevance to the habit of the user (children) and the buyer of the category

(concerned mother) has been used to reposition the brand. Lifebuoy's repositioning

on health based on hygiene is an attempt to take into consideration the priorities

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consumers place on heath in a deteriorating environment — one of the issues

raised frequently by mass media and consumer groups.

Changing the target segment

It is difficult for an established brand to change its target segment overnight

because of the prolonged associations and perceptions related to imagery and price.

However, there have been rare instances of a brand repositioning itself for a new

target segment. Cadbury, in an effort to make chocolates appeal to adults, created

the repositioning around `spontaneous joy' (the girl's dance in the cricket field) and

since then the mould version of its offering continues to be positioned for adults.

With the company offering different offerings for different segments, the strategy

for the mould version synergises with the overall strategy of the brand.

Timex,

which was targeting the lower-end watch market when it entered India, has

introduced expensive watches with high technology at the higher end of the

market. Technology, with its rub-off on the product's attributes, could be a

powerful factor in moving a brand from lower to higher segments. Changing the

target segment for an established brand is a delicate marketing exercise and several

aspects of marketing mix elements are involved. These are important from the

viewpoint of consumer perception.

Bata,

during the Nineties started dealing with designer brands: it had developed the

Power brand for youth and a number of offerings for middle-class consumers. In

the recent times, it has segmented its retail outlets into discount outlets and higher-

end ones. In such a situation, it may be difficult for the brand to reposition itself

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with a clear association. Communicating the newness can be seen in the `new,

`improved' versions of old established brands. The point that is important in such a

positioning is that consumers should be able to relate to the improved claims made

by the brand. If Rin is repositioned to provide extra whiteness, the attribute should

be recognised by consumers.

Decisions concerning repositioning

A brand need not always rely on repositioning: the decisions are related to the

strength of the company, competitive context and consumer perception. A brand

could create several sub-brands over a period of time in tune with the changes in

the environment. Hero Honda, after the success of its CD 100 almost two decades

ago, continues to hold sway over the market by creating several sub-brands each

distinctive from the other. It created SS, Passion and Splendor with differing

appeals. Sometimes, a premium offering needs to be repositioned when consumers

become more receptive to the brand over a period of time. Colgate Total, one such

offering, was initially positioned on multiple benefits but later, the same benefits

were positioned with the `12-hour protection' proposition.

Brand positioning and repositioning deals with the mind of consumer.

Brand repositioning is more complex as it has to take into account the perception

already created in the consumers' minds.

DEVELOPING BRAND DIFFERENTIATIONS

USP or the unique selling proposition of a brand continues to be a critical issue in

this era of digital marketing. Trout, one of the proponents of the positioning

concept, is of the opinion that any advertising for a brand should sell with a USP

rather than provide entertainment for viewers. USP positions a brand in the mind

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of the consumer and creates a strong differentiator for it from among competing

brands in the respective category. Fevistick (adhesive in the form of a stick) had

convience as its USP even though it is several times more expensive than the

regular gum. Maruti (the initial no-frills version) changed the Indian consumers’

perception of passenger cars. While a USP in today’s context can be a benefit from

brand attribute (ingredients of Colgate total resulting in multiple benefits

associated with oral care), there can be other ways also in which USP can be

formulated , by taking into consideration the various research inputs from the

appropriate target audience. Sidney Levy, a well known researcher in the area of

qualitative marketing presearch, proposed models on these qualitative aspects that

can be applied to the present day clutter of communication to ensure that the

message is conveyed to the intended segment. This can be very valuable to a

company interacting with an advertising agency to make sure that creativity is

meaningful and practical.

FACTORS THAT LEADS A BRAND TO REPOSITION

1) Operating environment - there could be changes in the environment brought

about by change in laws of the land etc. like ITC's shift towards FMCG and

apparels since tobacco industry is being hanuted world over due to its negative

factors.

2) Competition - Either you keep making the loudest noise or improve your

service deliverables a notch higher to that of your competition. In both cases it

calls for substantial resource allocation. So the simplest thing instead would be to

reposition yourself. There doesnt seem to be much of a dent in Airtells marketshare

despite the tough competition from Vodafone and our own BSNL.

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3) Brand positioning - Holds good for a lot of old world brands that have been

built on a sound proposition that was relevant in those days but look weak in

modern times. Like videocons change in positioning from a desi brand to that of an

international one.

TOP REASONS TO REPOSITION A BRAND

Brand repositioning is necessary when one or more of the following conditions

exist:

Your brand has a bad, confusing or nonexistent image.

The primary benefit your brand "owns" has evolved from a differentiating

benefit to a cost-of-entry benefit.

Your organization is significantly altering its strategic direction.

Your organization is entering new businesses and the current positioning is

no longer appropriate.

A new competitor with a superior value proposition enters your industry.

Competition has usurped your brand's position or rendered it ineffectual.

Your organization has acquired a very powerful proprietary advantage that

must be worked into the brand positioning.

Corporate culture renewal dictates at least a revision of the brand

personality

You are broadening your brand to appeal to additional consumers or consumer

need segments for whom the current brand positioning won't work. (This should

be a "red flag." This action could dilute the brand's meaning, make the brand less

appealing to current customers or even alienate current customers.)

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CHAPTER 2 :STAGES & STRATEGIES

STAGES IN BRAND STRATEGY DEVELOPMENT

The implication with the term” repositioning” is that a company modifies

something that is already present in the market and in the consumer’s mind. The

definition of repositioning changes different individuals and professions. To view

the different definitions and perceive a greater understanding about this concept,

three examples of repositioning given by individuals in different professions is

stated below:

“Repositioning is a change, principally about trigging the vision, mission and value

in

a new direction that is more suited for the brand in the future”

“Principally, reposition concerns changing the consumer’s perception of the

brand”

“Repositioning is built upon the change of unique and differentiated associations

with the brand in some kind of direction, it is about having a balance between the

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Establishing the brand proposition

Selecting appropriate marketing mix

Rolling out the strategy Introductory stage Elaboration Stage Fortification Stage

Modifying the proposition

Repositioning Updating the

personality.

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category party and differentiation when using reposition strategies”(Leading brand

strategist)

From these definitions, it is obvious that reposition is about moving

something to a newer and hopefully to a more attractive and relevant position. The

purpose of the movement differs with regards to what the company wants to

achieve. A company might want to reach out to a larger target group, or be

involved in several different positions at the market. There is also a visible relation

between price and quantity aspects. When a company perceives the market as a

demand curve, the purpose is to down stretch or up stretch in this curve. When

moving down it is often spoken of as an expansion down wards, and when moving

up and there is a need for reaching the premium segment and expand up wards.

THE PRINCIPLE OF REPOSITIONING

When striving towards a new position in the market, it is important to understand

that consumer’s minds are limited. People’s minds select what to remember and it

is therefore significant to convince the consumers with great arguments. The

market demand changes rapidly and therefore repositioning can be necessary to

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New Position

Previous position

Experienced Quality

Price

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meet these demands, newer and stronger arguments have to be established to

convince them to stay as loyal customers.

As stated in the literature, repositioning is a very complicated matter and

therefore there are no detailed theories or models. The aim with repositioning

differ from person to person, and the only connection between all the different

theories is that repositioning is moving something from somewhere towards a

greater position at the market.

BRAND REPOSITIONING STRATEGIES

Corstjens and Doyle (1989) identified three types of repositioning strategies:

(1) Zero repositioning, which is not a repositioning at all since the firm maintains

its initial strategy in the face of a changing environment;

(2) Gradual repositioning, where the firm performs incremental, continuous

adjustments to its positioning strategy to reflect the evolution of its environment;

(3) Radical repositioning that corresponds to a discontinuous shift towards a new

target market and/or a new competitive advantage.

After examining the repositioning of several brands from the Indian market,

the following 8 types of repositioning have been identified. These are:

1. Increasing relevance to the consumer

2. Increasing occasions for use

3.Making the brand serious

4. Falling sales

5. Bringing in new customers

6.Making the brand contemporary

7. Differentiate from other brands

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8.Changed market conditions.

It is not always that these eight categories are mutually exclusive. Often one reason

leads to the other and a brand is repositioned sometimes for a multiplicity of

reasons.

SEGMENTATION – REPOSITIONING LINKAGES

Segmentation is the process of dividing a cluttered market (in terms of a mix of

consumers) into homogeneous markets in such a way that a company can target

specific consumer segments with its positioning strategies. Segmentation variables

are used to divide the market. In a dynamic competitive context, marketers should

consider the constant changes in their target segments and reposition the brand

accordingly. The following aspects provide linkages between segmentation-related

changes and brand repositioning direction:

How should brands be repositioned when segment of consumers buying

brands offering value shift to unbranded offerings? This happens in

unorganized markets in categories like edible oil, pens and moulded

luggage. An un-organised market is one which has a number of unbranded

offerings promoted only through low prices in local markets. They are

generally not branded and fall short of quality expectations. These offerings

are sold within a vicinity of about 20 to 30Km from the place of

manufacture and some of them may also be illegal offerings (duplicates).

How should a brand that wants to appeal to a different segment be

repositioned?

How should a brand that wants to supplement its existing brand personality

position itself for an additional segment to be repositioned?

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How should a brand, successful with a functional proposition, be

repositioned to another segment which may require a symbolic orientation

apart from the functional qualities?

How should a premium brand that wants to enlarge its niche segment after it

has created brand awareness, be repositioned?

How should a brand be repositioned when it wants to reach out to

consumers at the upper end of the market? (It has to be ensured that the

brand does not get into an “image trap” as it is moving from down market to

an up-market position).

How should a brand be repositioned when it wants to shed its image (due to

competitive reasons) after maintaining a proposition for a period of time in

the market?

The seven linkage points out to the fact that brand repositioning in a

competitive environment involves a combination of issues concerning brand

associations, sub-brands, product-line offerings and marketing mix

elements.

SUSTAINABLE CORE PROPOSITION (SCP) STRATEGIES &

BRAND RELATED DIMENSIONS IN REPOSITIONING

There are seven kinds of repositioning strategies taking into consideration the

segmentation repositioning linkages and the basic idea of SCP & brand related

dimensions.

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Value-Oriented Repositioning

Segment-Oriented Repositioning

Celebrity-Oriented Brand Enhancement Repositioning

Symbolism-Oriented Repositioning

Upmarket Technology-Oriented Repositioning

Niche-Oriented Repositioning

Change of Image-Oriented Repositioning

The Above seven kinds of repositioning strategies are explained as follows:

Value-Oriented Repositioning

This strategy is useful in two situations:

1. When a brand offering values is competing against the unorganized

sector (explained in the example given below)

2. When a brand has strongly established a value proposition.

The examples are old ones but ones that offer insights for a conceptual

direction. The three examples reflect the importance of repositioning a

brand associated with value in the perception of consumers.

Reynolds is a brand of ball-pen which was launched in India during the

eighties. It was nearly double the price of the other competitive offerings

in the market. These offerings which were in the un-organised

sector(without registered brand names and marketed in a small territory)

were of poor quality. Reynolds used the skimming price(higher price

point) strategy and became a successful brand. Besides, Reynolds also

has a sturdy product casing( apart from a good, uniform flow of ink

which ensured easy writing).

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Though consumers paid more for Reynolds, they perceived it as a reliable

brand. Reynolds created this positioning and association through a good

product and higher price. Its advertisements created awareness but the

associations came from a “price quality” perception in that ball-pen

market. Repositioning Reynolds should involve a better quality product

and higher price (even if variants are launched), especially when a

number of brands have entered the market with similar offerings.

Akai was practically institutionalized the second-hand TV market in

India. At a time when consumers perceived “price number of features”

combination as an indication of value. Akai created value perception by

announcing exchange schemes. There were schemes by which consumers

could exchange their existing television for a new one and pay around 50

percent of the price for a new television. In a market where brands were

attempting to positioning themselves as “no frill-low price” or “feature

ridden” or through comparative advertisements that emphasized a few

extra features, Akai entered the mind of prospects through sales

promotion schemes. Akai could position itself as a brand which offers

value through good sales promotion schemes. Repositioning for Akai will

work through sales promotion schemes that are enhanced through proper

value addition. The creativity in repositioning exercise for Akai will lie in

the ability of the brand/organization to launch innovative and competitive

sales promotion schemes. If a brand relies on certain unique

characteristics of the market(large number of second-hand buyers in this

context), it may be effective to use a similar approach while repositioning

it. Of course there are other options like creating a high quality product

and symbolic aspects. But the unique association of a brand is carried

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over with an innovative approach that is associated with the original

positioning strategy.

The edible oil market in India is largely dominated by manufactueres of

loose oil who sell unbranded, unpacked edible oil. The branded ones

cater to the upper end of the market. Vendee, a brand of edible oil created

a differentiation by reaching out to consumers through vending

machines-in an unpacked form. There was standardization of quality with

regards to this brand. Consumers (in the loose-market segment) who

were used to inconsistent quality of edible oil may have thought of

upgrading to vendee. The positioning routevendee was through the

innovative distribution channel. It was distributed through vending

machines. Repositioning the brand will involve a better quality oil

variants through vending machines. This will give the brand credibility

vendee’s original association has been with vending machines.

Segment-Oriented Repositioning

This strategy is useful when a brand wants to change the segment to which it

is currently catering.

Sunny was a two-wheeler scooterette (a hybrid between a moped and

(scooter) which was initially positioned for teenagers. The brand was

endorsed by a well-known sports celebrity. The initial positioning wa

through a novel product (scooterette) and the glamour of the celebrity

both of which may have appealed to the target segment. The company

probably realized that the product(50cc) was not much of a success in the

market. This was reflected when the brand was repositioned as Sunny Zip

and it was upgraded to 75cc. the target segment for the repositioned

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product was women, comprising the housewives and college-going girls.

The repositioning involved up-gradation of the product change of

segment and a sub-brand(Sunny Zip). The advertisements did not

incorporate a celebrity. They showed typical users of the product. Brand

imagery was used to strengthen the brand association. This is an

example of brand repositioning for a new target segment after the product

is modified.

Another interesting example is the Fair & Lovely fairness cream. After

decades of positiong on the fairness platform for young people, the brand

started targeting middle-aged married women. The TV commercial

amplifies the usage of the brand by a married women (user imagery) and

not so much the brand benefit(which has been hammered in for years).

This approach also shows how a benefit can be extended to different

segments at different times, especially when the original target segment

may be exposed to new brands. This approach may require development

of a strong brand before such a repositioning is done. Fairness as a

benefit was being extended to married women at a time when personal

grooming has become important for consumers I in the Indian context.

The brand did not continue the repositioning presumably because of

strategic reasons which gave away to several other variants subsequent to

the repositioning exercise discussed.

In consumables, Cadbury chocolate ( moulded variant in the rectangular

slab) was positioned for children in the eighties. In the nineties, the same

variant was directed towards adults using a change in the brand imagery.

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The objective of the brand was to expand the market and bring in adults

into its segment Cadbury introduced a variant of the moulded version

under the sub-brand Cadbury’s Gold. This sub-brand was positioned on a

permissive and mischievous personality platform with appropriate visuals

(in the TV commercial) the TV commercial showed a lady clad in

permissive apparel in a gymnasium embracing men. This association

contradicted the “fun-loving adult” association of the earlier moulded

variant that was not considered as permissive in the Indian context

(during the time the brand was launched, and the context has changed

since then). Cadbury’s Gold did not sustain itself in the retail shelves.

‘Was it because of the contradictory brand associations?’ is the

conceptual angle that needs to be addressed while discussing

repositioning strategies. This example reflects the impact of positioning a

new variant, using overall brand associations, associated also with the

earlier variants.

Celebrity-Oriented Brand Enhancement Repositioning

This strategy is useful when brand uses imagery (can even be a celebrity) to

strengthen its association and makes an attempt to enter a new segment

based on the strength of the same imagery.

BPL, a brand in consumer electronics, originally operated in business-to-

business marketing (X-rays and telecom) before moving into televisions,

its first product category in consumer electronics. The brand initially

positioned itself as one associated with high technology. This is a typical

example of a brand attempting to use technology as an intangible.

Consumers may have exhibited a strong preference towards the brand

because of tis technology association without even knowing its

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intricacies. During the mid-nineties the brand repositioned itself using a

celebrity association. The celebrity had a charismatic appeal(for masses

as well as elite) and would have been a good fit for the brand which is

targeting the rural Indian population. The company is also marketing

refrigerators, microwaves, radios, CDs and kitchen appliances. The

repositioning using a celebrity did not elaborate on product attributes or

benefits. It used ethnocentrism, a personality-related concept which

reflects a strong tendency on the part of an individual to buy products

which are made in his own country. The celebrity in the TV commercial

spoke about the conviction which consumers should have about Indian-

made products. This was an effective strategy considering there are a

number of multinational companies in the consumer electronic categories

in india. The repositioning exercise added a favourable ‘Indian’

association to the associations of the brand that had a favourable image.

The repositiong may have also helped the brand to make an impact on

rural consumers, for whom the celebrity held a tremendous charisma.

Symbolism-Oriented Repositioning

This strategy is useful when a brand wit h a strongly entrenched “functional”

image wants to expand its market using a symbolic positioning without

losing its earlier association.

Bajaj, a brand in two-wheelers, was in the Indian context for over several

decades. The brand personality of Bajaj was ‘rugged, trustworthy,

economy-oriented and a family friend’. With lifestyle changes in the

nineties, Bajaj attempted to reposition itself as a contemporary hip two-

wheeler. Bajaj came out with specific sub-brands (affixed to the

reassuring name of Bajaj-Bravo and Classic. Both these sub-brands were

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positioned on the lifestyle platform. Classic was positioned as a vehicle

which provided a comfortable and enjoyable experience to an executive

who leads a high-pressured life. Bravo was positioned as a scooter which

would appeal to men who like to havea ‘macho’ image. The repositioning

exercise here was attempted partly with new sub-brands. The

repositioning exercise of Bajaj with the sub-brands reflects the

alternatives available for an entrenched brand to reposition itself (there

may be several other factors that go into the actual success of an

offering).

Raymond is a well-known upmarket brand in textiles. The brand initially

positioned itself as a “guide to a well-dressed male”. The brand is priced

higher than a number of other fabric brands and it has a network of

exclusive outlets throughout the country. The brand repositioned itself a

decade ago as the fabric for “the complete man”. The repositioning

attempted to emphasize that the offering was meant for an up-market

consumer who also has his share of family experiences in life.

Repositioning of the brand involved lifestyle aspects after the functional

proposition of the brand was well-accepted by consumers. The lifestyle

repositioning of the brand has created a strong differentiation for the

brand.

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Upmarket Technology-Oriented Repositioning

This kind of strategy is useful when a down market brand attempts an

upward stretch apart from continuing to serve its current consumer

segments.

Pond’s os a household name in India. The brand repositioned itself as a

contemporary skin-care brand using the technology and research

association.The brand used the concept of “Pond’s Institue” that was

associated with state of the art products. Pond’s currently has skin-care

products in the upper end of that market. The repositioning of the brand

created a perception which helped it to “move” to the higher end of the

market without a new brand or sub-brand from the perception of

consumers. It is also worthwhile to note that the brand could stretch itself

upwards without getting into the “image trap”.

Niche-Oriented Repositioning

This strategy is useful when a niche brand (premium one) is interested in

expanding its consumer base after it has created brand awareness.

Dove is premium soap in the upper end of the soap market and the brand

has a small market share in the overall soap market. Initially, the brand

attempted to reposition the entire soap market by introducing the brand as

a moisturizer bar. Dove’s TV commercial compared other offerings of

soaps and conveyed that the brand is superior to soaps(establishing the

point of difference after conveying the point of parity to enable the

consumers to know that the brand competes with soaps). The positioning

focused on the advantages of using a moisturizer bar. Dove’s positioning

in a niche market involved the repositioning of the soap category. The

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brand continued to reposition the soap category with a new TV

commercial on the same theme.

Change of Image-Oriented Repositioning

It is worthwhile to investigate the impact of marketing mix elements on

positioning strategies. An interesting aspect is that the environment can also

influence the positioning of a brand along with its marketing mix strategies.

Maruti 800 (“the no-frill” version) was a car launched in the economy

segment in India during the mid eighties. The brand was sold at a

premium for three years. Maruti was not a brand which a middle class

household in india could afford. The periodic price hikes in over a decade

and the proliferation of two-wheeler brands (had made Maruti a status

symbol, if not a premium one). When competition entered the market

with several offerings the perception of “value” underwent a change in

the minds of consumers. After 15 year of success with the “small” car

image, Maruti has repositioned itself as a car for the Indian middle class.

Repositioning has initiated a change in the brand image without affecting

the core economy proposition of the brand.

Ray Ban, the global brand of sunglasses, entered india during the early

nineties through a positioning which emphasized the brand name. Later,

the brand was repositioned using product benefits as the theme of the

repositioning exercise. Some variants in the product line were also

positioned on the lifestyle theme with a specific sub-brand (Killer Loop).

Repositioning of the brand also consisted of introducing low-priced

variants to create a perception that the brand was not as up-market as

consumers perceived it to be. In all these repositioning examples, the

brands made use of “image change”. The sustainable core proposition

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(SCP) is extremely useful in terms of creating brand associations suited

for the long term usage. But there can be a number of situations in which

the positioning association of a brand needs to be changed, and the

consistency involved in SCP cannot be followed when the brand is not

accepted by target segment. A framework which emphasizes the usage of

SCP and non-SCP strategies based on two specific dimensions can help

marketers to decide on the applicability of the SCP in a given marketing

environment. The framework also helps to analyze the changes required

to fine tune positioning strategies so that the brand is accepted by the

target segment after the initial positioning strategy has failed to evoke the

required response.

FOUR PHASED BRAND REPOSITIONING APPROACH TO ACHIEVE

THE INTENDED BENEFITS

A four-phased brand repositioning approach can be followed to achieve the

intended benefits:

Phase I. Determining the Current Status of the Brand

Phase II. What Does the Brand Stand for Today?

Phase III. Developing the Brand Positioning Platforms

Phase IV. Refining the Brand Positioning and Management Presentation

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The benefits that can be derived from brand repositioning exercises can be

summarized as:

Value over others

Updated personality

Relevant position

The risks associated with such strategies are:

Loss of focus

Neglecting original customers

Losing credibility for the brand

Confusing the brand

Therefore, brand repositioning is more difficult than initially positioning a

brand because one must first help the customer “unlearn” the current brand

positioning (easier said than done). Three actions can aid in this process: (1)

carefully crafted communication, (2) new products, packaging, etc. that emphasize

the new positioning and (3) associations with other brands (co-branding, co-

marketing, ingredient branding, strategic alliances, etc.) that reinforce the new

brand positioning.

This exercise is so critical to an organization’s success that the organization’s

leadership team and its marketing/brand management leaders should develop it,

preferably with the help and facilitation of an outside brand-positioning expert.

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CHAPTER 3 : SUCCESS IN BRAND REPOSITIONING

S U C C E S S F U L B R A N D R E P O S I T I O N I N G

ASPIRATIONAL VS. ACHIEVABLE STRATEGIES

Many marketers are rethinking their brand’s positioning because competitive

pressures, new channels, and changing customer needs have eroded their brands’

positions of strength. How- ever, increased marketing expenditures to reposition

brands often fail to produce any improvements in either overall image or market

share. Our experience has shown that companies should focus on achievable rather

than aspirational positioning, and that three steps can help ensure success:

1 . Ensure relevance to a customer’s frame of

reference.

Be fully aware of the brand’s “frame of reference” so

that a repositioning strategy will resonate with

customers.

Look at a combination of customers’ attitudes and

the situations in which the brand is used to obtain the

most powerful customer insights.

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2. Secure the customer’s “permission” for the

positioning.

Recognize that permission amounts to a reasonable and logical extension of the brand

in the customer’s eyes.

Leverage a brand’s unique emotional benets to carry

customers from their current brand perception to the

intended one.

3. Deliver on the brand’s new promise.

Identify the pathway of performance “signals” that

will convince customers of the new brand positioning.

Develop product/ service programs to ensure

consistent performance on these signals.

Track and assess performance against customer signals

prior to launching the new positioning.

Adopt an “interim positioning” to establish brand

credibility and performance.

An array of factors is requiring marketers today to rethink their brand positioning.

Changing customer needs are often eroding the brand’s established position. At the

same time, increasing competitive pressures created by new entrants and product

innovations, and the proliferation of new channels and promotional campaigns, are

driving marketers back to the drawing board. Many CEO s and CMO s, however,

nd themselves displeased with the results of their repositioning efforts. Increased

marketing expenditures devoted to repositioning brands in the minds of consumers

often fail to produce any improvements in either overall image or market share.

Be Relevant to the Customer’s Frame of Reference

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When repositioning a brand, it’s essential for marketers to capture not just the

emotional and physical needs of the customer, but the dynamics of the situation in

which those needs occur. We refer to this as the customer’s “frame of reference.”

For example,

while Rasna and Tang are thirst- quenching drinks, consumers tend to think of them

in the broader context of sports, exercise, and physical activity. Importantly, the

frame of reference sets the parameters for customers’ consideration set – the

brands they will choose from. Indeed, most customers have a very specic denition

of what the brand is and what it can be relative to their frame of reference.

Repositioning a brand too far from this frame of reference creates customer

confusion that makes a positioning unsuccess- ful.

Being fully aware of the frame of reference for a brand can help ensure that its

repositioning strategy will resonate with custom- ers. But the frame of reference is

usually a combination of both customers’ attitudes and the situations in which the

brand is used. As a result, we typically nd the most powerful customer

insights and segmentation come from looking at a combination

of these factors.

In some categories, customers’ broader attitudes are the dominant factor.

How customers think about pet-related brands, for example, can be seen in

the context of how they treat their own pets – whether they view them as

family members, best friends/ companions, or in a less personal way. If

customers view pets as family members, the optimal message for the brand

will appeal to such human qualities as nurturing and pampering. This

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“familymember” orientation or frame of reference may helpsupport a brand

extension to a full range of pet services,such as grooming and accessories.

Other customer needs are not as consistent, but better understood within the

context of specicsituations or sub- categories. In the eld of airline travel, for

example, the customer’s frame of reference may be a function of the

type of trip they are taking. The customer who is used to traveling within the

U.S. in cramped coach-class conditions, for example, will have a much

different set of needs and expectations than the traveler who is used to ying

to international destinations with all the comforts of rst-class service.

As a result, in most instances the frame of reference is built upon a

combination of both of the above attitudinal and situational forces. For

example, while consumers may generally have a health-conscious attitude

about the foods they eat, on certain “special” occasions they may allow

themselves to become more indulgent, creating what we call a “need state.”

Securing the Customer’s “Permission”

Establishing the frame of reference does not automatically translate into successful

brand repositioning. To reach that end point, marketers must rest ensure they have

the customer’s “permission” to claim the new ground to which the brand aspires.

Because that permission amounts to a reasonable and logical extension of the

brand in the eyes of the customer, it requires building a “bridge” that can carry

customers from where they perceive your brand to be today to where you want to

take it in the future. Thus, for the Celestial Seasonings brand, the bridge leverages

customers’ perceptions of the brand as “organic, natural, and healthy” to allow the

brand to extend from its core product offering of teas into herb-based and

“alternative” vitamin and mineral supplements. Similarly, Marriott uses customers’

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perceptions of the brand as a leader in hotels and “living-care” to extend the brand

into assisted living for senior citizens.

Emotional brand benets can provide the most powerful source of brand permission.

If a brand is currently meeting the customer’s emotional needs, then extension of

that brand into an allied product/ service arena becomes much more plausible and

acceptable – the extension is likely to be granted customer permission. For example,

the strong emotional benets associ- ated with the Hallmark brand in greeting cards

allowed for the extension of the brand into wrapping papers, ornaments, and other

products with emotional ties to celebration and com- memoration. A strong brand

identity can also help marketers secure the desired permission from consumers.

Because Victoria’s Secret owns or is associated with the notion of intimate

moments,

for example, it would be easier for that brand to get permission to introduce a new

line of lingerie or perfume with a sensual connotation than it would be to launch a

line of jeans or handbags.

In repositioning, marketers must embrace the idea that they are brand “stewards,”

while customers dene their relationship with the brand and determine the basis for

the relationship. A

steward must spend more time deeply understanding what customers really think

about the brand and where potential “bridges” to growth and new positionings

exist.

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CHAPTER 4 : INTRODUCTION TO AXIS BANK

ORGANISATION INTRODUCTION

Axis Bank, previously called UTI Bank, was the first of the new private banks to

have begun operations in 1994, after the Government of India allowed new private

banks to be established. The Bank was promoted jointly by the Administrator of

the Specified Undertaking of the Unit Trust of India (UTI-I), Life Insurance

Corporation of India (LIC), General Insurance Corporation Ltd., National

Insurance Company Ltd., The New India Assurance Company, The Oriental

Insurance Corporation and United Insurance Company Ltd. UTI-I holds a special

position in the Indian capital markets and has promoted many leading financial

institutions in the country. The bank changed its name to Axis Bank in April 2007

to avoid confusion with other unrelated entities with similar name.[2] Shikha

Sharma was named as the bank's managing director and CEO on 20 April 2009.[3]

As on the year ended March 31, 2009 the Bank had a total income of Rs. 13,745.04

crores and a net profit of Rs 1,812.93 crores

Branch Network

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At the end of March 2009,the Bank has a very wide network of more than 726

branch offices and Extension Counters. The Bank has loans now (as of June 2007)

account for as much as 70 per cent of the bank’s total loan book of Rs 2,00,000

crore. For HDFC Bank, retail assets are around 57 per cent (Rs 28,000 crore) of the

total loans as of March 2007.

In the case of Axis Bank, retail loans have declined from 30 per cent of the total

loan book of Rs 25,800 crore in June 2006 to around 23 per cent of loan book of

Rs.41,280 crore (as of June 2007). Even over a longer period, while the overall

asset growth for Axis Bank has been quite high and has matched that of the other

banks, retail exposures grew at a slower pace.

If the sharp decline in the retail asset book in the past year in the case of Axis Bank

is part of a deliberate business strategy, this could have significant implications

(not necessarily negative) for the overall future profitability of the business.Despite

the slower growth of the retail book over a period of time and the outright decline

seen in the past year, the bank’s fundamentals are quite resilient. With the high

level of mid-corporate and wholesale corporate lending the bank has been doing,

onewouldhaveexpectedthenetinterestmargins to have been under greater pressure.

The bank, though, appears to have insulated such pressures. Interest margins, while

they have declined from the 3.15 per cent seen in 2003-04, are still hovering close

to the 3 percent mark. (The comparable margins for ICICI Bank and HDFC Bank

are around 2.60 per cent and 4 per cent respectively. The margins for ICICI Bank

are lower despite its much larger share of the higher margin retail business, since

funding costs also are higher).

HISTORY

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1993

The Bank was incorporated on 3rd December and Certificate of Business on

14th December. The Bank transacts banking business of all description. UTI

Bank Ltd. was promoted by Unit Trust of India, LifeInsurance Corporation of

India, General Insurance Corporation of India and its four subsidiaries.

The bank was the first private sector bank to get a license under the new

guidelines issued by the RBI.

1997

The Bank obtained license to act as Depository Participant with NSDL and

applied for registration

with SEBI to act as `Trustee to Debenture Holders'.

Rupees 100 crores was contributed by UTI, the rest from LIC Rs 7.5 crores, GIC

and its four

subsidiaries Rs 1.5 crores each.

1998

The Bank has 28 branches in urban and semi urban areas as on 31st July. All the

branches are fully computerised and networked through VSAT. ATM services

are available in 27 branches.

The Bank came out with a public issue of 1,50,00,000 No. of equity shares of Rs

10 each at a premium

of Rs 11 per share aggregating to Rs 31.50 crores and Offer for sale of

2,00,00,000 No. of equity

shares for cash at a price of Rs 21 per share. Out of the public issue2,20,000

shares were reserved

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for allotment on preferencial basis to employee of UTI Bank. Balance of

3,47,80,000 shares were

offered to thepublic.

The company offers ATM cards, using which account-holders canwithdraw

money from any

of the bank's ATMs across the country which are inter-connected by VSAT.

UTI Bank has launched a new retail product with operational flexibility for its

customers.

UTI Bank will sign a co-brand agreement with the market, leader, Citibank NA

for entering into

the highly promising credit card business.

UTI Bank promoted by India's pioneer mutual fund Unit Trust of India along

with LIC, GIC and its four subsidiaries.

1999

UTI Bank and Citibank have launched an international co-branded credit card.

UTI Bank and Citibank have come together to launch an international co-

branded credit card

under the MasterCard umbrella.

UTI Bank Ltd has inaugurated an off site ATM at Ashok Nagar here, taking the

total number of its

off site ATMs to 13.m

2000

The Bank has announced the launch of Tele-Depository Services for its

depository clients.

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UTI Bank has launch of `iConnect', its Internet banking Product.

UTI Bank has signed a memorandum of understanding with equitymaster.com

for e-broking

activities of the site.

Infinity.com financial Securities Ltd., an e-broking outfit is typing up with UTI

Bank for a banking interface.

Geojit Securities Ltd, the first company to start online trading services, has

signed a MoU with

UTI Bank to enable investors to buy\sell demat stocks through the company's

website.

Indiabulls has signed a memorandum of understanding with UTI Bank.

UTI Bank has entered into an agreement with Stock Holding Corporation of

India for providing loans against shares to SCHCIL's customers and funding

investors in public and rights issues.

ICRA has upgraded the rating og UTI Bank's Rs 500-crore certificate of deposit

programme to A1+.

UTI Bank has tied up with L&T Trade.com for providing customized online

trading solution for

brokers.

2001

UTI Bank launched a private placement of non-convertible debentures to raise

up to Rs 75 crore.

UTI Bank has opened two offsite ATMs and one extension counter with an

ATM in Mangalore,

taking its total number of ATMs across the country to 355.

UTI Bank has recorded a 62 per cent rise in net profit for the quarter ended

September 30, 2001,

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at Rs 30.95 crore. For the second quarter ended September 30, 2000, the net

profit was Rs 19.08

crore. The total income of the bank during the quarter was up 53 per cent at Rs

366.25 crore.

2002

UTI Bank Ltd has informed BSE that Shri B R Barwale has resigned as a

Director of the Bank w.e.f.

January 02, 2002. A C Shah, former chairman of Bank of Baroda, also retired

from the bank’s board in

the third quarter of last year. His place continues to be vacant. M Damodaran

took over as the

director of the board after taking in the reins of UTI. B S Pandit has also joined

the bank’s board subsequent to the retirement of K G Vassal.

UTI Bank Ltd has informed that Shri Paul Fletcher has been appointed as an

Additional Director

Nominee of CDC Financial Service(Mauritius)Ltd of the Bank.And Shri

Donald Peck has been

appointed as an Additional Director (nominee of South Asia Regional Fund) of

the Bank.

UTI Bank Ltd has informed that on laying down the office of Chairmanof LIC

on being appointed as Chairman of SEBI, Shri G N Bajpai, Nominee Director of

LIC has resigned as a Director of the Bank.

2002

B Paranjpe & Abid Hussain cease to be the Directors of UTI Bank.

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UTI Bank Ltd has informed that in the meeting of the Board of Directors

following decisions were

taken: Mr Yash Mahajan, Vice Chairman and Managing Director of Punjab

Tractors Ltd was appointed

as an Additional Director with immediate effect. Mr N C Singhal former Vice

Chairman and

Managing. Director of SCICI was appointed as an Additional Director with

immediate effect.

ABN Amro, UTI Bank in pact to share ATMs.

UTI Bank Ltd has informed BSE that a meeting of the Board of Directors of the

Bank is scheduled to be held on October 24, 2002 to consider and take on record

the unaudited half yearly/quarterly financial results of the Bank for the half

year/Quarter ended September 30, 2002.

UTI Bank Ltd has informed that Shri J M Trivedi has been appointed as an

alternate director to Shri Donald Peck with effect from November 2, 2002.

2003

UTI Bank Ltd has informed BSE that at the meeting of the Board of Directors of

the company held on January 16, 2003, Shri R N Bharadwaj, Managing Director

of LIC has been appointed as an Additional Director of the Bank with immediate

effect.

UTI Bank, the private sector bank has opeaned a branch at Nellore.The bank's

Chairman and

Managing Director, Dr P.J. Nayak, inaugurating the bank branch at GT Road on

May 26. Speaking

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on the occasion, Dr Nayak said, This marks another step towards the extensive

customer banking

focus that we are providing across the country and reinforces our commitment

to bring superior

banking services, marked by convenience and closeness to customers.

UTI Bank Ltd. has informed the Exchange that at its meeting held on June 25,

2003 the BOD

have decided the following: 1) To appoint Mr. A T Pannir Selvam, former

CMD of Union Bank of India and Prof. Jayanth Varma of the Indian Institute of

Management, Ahmedabad as additional directors of the Bank with immediate

effect. Further, Mr. Pannir Selvam will be the nominee director of the

Administrator of the specified undertaking of the Unit Trust of India (UTI-I) and

Mr. Jayanth Varma will be an Independent Director. 2) To issue Non-

Convertible Unsecured Redeemable Debentures upto Rs.100 crs, in one or more

tranches as the Bank's Tier - II capital.

UTI has been authorised to launch 16 ATMs on the Western Railway Stations of

Mumbai Division.

UTI filed suit against financial institutions IFCI Ltd in the debt recovery tribunal

at Mumbai to recover Rs.85cr in dues.

UTI bank made an entry to the Food Credit Programme, it has made an

entry into the 59 cluster which includes private sector, public sector, old private

sector and co-operative banks.

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Shri Ajeet Prasad, Nminee of UTI has resigned as the director of the

bank.

Banks Chairman and MD Dr.P.J.Nayak inaugurated a new branch at

Nellore.

UTI bank allots shares under Employee Stock Option Scheme to its

employees.

Unveils pre-paid travel card 'Visa Electron Travel Currency Card'

Allotment of 58923 equity shares of Rs 10 each under ESOP.

UTI Bank ties up with UK govt fund for contract farming

Shri B S Pandit, nominee of the Administrator of the Specified

Undertaking of the Unit Trust of India (UTI-I) has resigned as a

director from the Bank wef November 12, 2003.

UTI Bank unveils new ATM in Sikkim

2004

Comes out with Rs. 500 mn Unsecured Redeemable Non-Convertible

Debenture Issue, issue fully subscribed

UTI Bank Ltd has informed that Shri Ajeet Prasad, Nominee of the

Administrator of the Specified Undertaking of the Unit Trust of India (UTI - I)

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has been appointed as an Additional Director of the Bank w.e.f. January 20,

2004.

UTI Bank opens new branch in Udupi

UTI Bank, Geojit in pact for trading platform in Qatar

UTI Bank ties up with Shriram Group Cos

Unveils premium payment facility through ATMs applicable to LIC & UTI

Bank customers

Metaljunction (MJ)- the online trading and procurement joint venture of Tata

Steel and Steel Authority of India (SAIL)- has roped in UTI Bank to start off

own equipment for Tata Steel.

DIEBOLD Systems Private Ltd, a wholly owned subsidiary of Diebold

Incorporated, has secured a major contract for the supply of ATMs and services

to UTI Bank

HSBC completes acquisition of 14.6% stake in UTI Bank for .6 m

UTI Bank installs ATM in Thiruvananthapuram

Launches `Remittance Card' in association with Remit2India, a Website offering

money-transfer services

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2005

UTI Bank enters into a bancassurance partnership with Bajaj Allianz General for

selling general insurance products through its branch network.

UTI Bank launches its first Satellite Retail Assets Centre (SRAC) in Karnataka

at Mangalore.

2006

UTI Bank unveils priority banking lounge

UTI Bank launches operations of UBL Sales, its Sales Subsidiary -Inaugurates

its first office in Bengaluru

UTI Bank announces the launch of its Credit Card Business

UTI Bank becomes the first Indian Bank to successfully issue Foreign Currency

Hybrid Capital in the International Market

UTI Bank Business Gold Debit Card MasterCard Launched – Designed for

business related spending by SMEs and self employed professionals

2007

AXIS Bank Ltd has informed that consequent upon handing over charge as

Administrator of the Specified Undertaking of the Unit Trust of India (SUUTI),

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Shri. S B Mathur, the Nominee Director of SUUTI has resigned as a Director of

the Bank w.e.f. December 06, 2007.

AXIS Bank Ltd has informed that Fitch Ratings on December 14, 2007,has

upgraded the Bank's National Long-term rating to 'AAA(ind)' from 'AA+(ind)'.

AXIS Bank Ltd hasappointed Shri K N Prithviraj as an Additional Director on

the Board at Directors of the Bank.

Company name has been changed from UTI Bank Ltd toAxis Bank Ltd.

2008

Axis Bank launches Platinum Credit Card, India's first EMV chip based card

Axis Bank set up its branch at Ilanji at Meenakshi Nagar on the Coutralam-

Madurai road on April 16.

2009

Axis Bank today said its board has recommended the appointment of Shikha

Sharma, currently chief of ICICI group's life insurance business, as its next

managing director and CEO.

Axis Bank has set up a new branch at Perumbavoor. The bank has a network of

832 branches along with 8 extension counters and 3622 ATMs across the

country.

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Axis Bank, on Wednesday entered into a strategic alliance with Motilal Oswal,

the financial services firm, in order to facilitate the online trading for the bank's

customers.

AXIS Bank Ltd has informed that the Board of Directors of the Bank at its

meeting held on June 01, 2009, inducted Smt. Shikha Sharma as an Additional

Director of the Bank.

Axis bank has received final clearance from the Securities and Exchange Board

of India (SEBI) to begin its mutual fund operation and will launch debt and

equity schemes soon whereas IDBI Bank is awaiting the regulator's permit for an

entry.

Axis Bank opened the new branch at Irinjalakuda while it has a network of 892

branches, 8 extension counters and 3,806 ATMs across the country.

2010

Axis Bank Limited has informed that at the meeting of the Board of Directors

held on January 15, 2010, the following decisions were taken:

(1)To appoint Dr. Adarsh Kishore, former Finance Secretary, Government of

India and former Executive Director, International Monetary Fund

representing Bangladesh, Bhutan, India and Sri Lanka,as the Non-Executive

Chairman of the Bank, subject to RBI approval;

(2)To appoint Shri S.B. Mathur, former Chairman, LIC and the National Stock

Exchange

of India, as an Additional Independent Director, with immediate effect.

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AXIS Bank Ltd has appointed Shri M. S. Sundara Rajan, former CMD, Indian

Bank as an Additional Independent Director with immediate effect.

SER V ICES

Retail banking

Deposit schemes

Loans and advances

- Personal Loans

- Housing Loans

- Cards

- Consumer durables

- Auto Loans

Personal banking

Accounts

- Terms deposits

- Fixed deposits

- Recurring deposits

Cards

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- Different variants like: Gold plus cards, silver and silver plus cards

Corporate banking

Accounts

- Normal current a/c

- Trust/NGO savings a/c

Services

- Private equity, mergers and acquisitions

- Advisory services

- Capital market funding

- E- broking

INFORMATION SYSTEM

Axis Bank has implemented a new derivatives system -- Summit FT by global

financial applications provider -- Misys. The system will provide the bank

with the ability to structure derivative products in real time, reduce time to

market, and give a single view of the entire transaction to the customer.

According to Prabhakar Saxena, general manager (India) of Misys, "A lot of

banks are providing derivative products on a back to back basis. But these are

plain vanilla products, which are uniform in nature.Summit FT will help Axis

to structure its derivative products differently and offer its customers products

that are different from the run-of-the-mill derivatives. Thus, it can charge a

premium for its dynamic services." The bank hopes to leverage the ability to

rationalize its currently dispersed functions to provide a single view of every

transaction to customers. Derivative transactions can expose the bank to three

broad categories of risks: counterparty credit risk, market risk, and operational

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risk. With derivatives and structured products operations currently served by a

range of third party vendor solutions, spreadsheets, and customer built

platforms, the bank is predicting that rationalizing systems across front,

middle, and back office operations will provide significant competitive

advantage. "Apart from helping the bank to create new derivative products

without having to resort to developers each time, it also helps from a

regulatory compliance standpoint," said Saxena. The RBI favors transparent

online systems that can track every transaction and report it exactly as it is.

Currently spreadsheets are being used to record information, which leaves

room for misreporting,errors etc. The Summit FT product was evaluated

against Products by competitors Murex and Calypso before it was finally

adopted by Axis Bank.

SWOT ANALYSIS

Strength

Support of various promoters.

High level of services.

Knowledge of Indian market.

Weakness

Market capitalization is very low.

Not having good image.

Not been able to position itself correctly.

Opportunities

Growing Indian bank sectors.

People are becoming more service oriented.

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Opportunities to be explored in global market.

Threats

Threat from various competitors.

- Foreign banks

- Govt. banks, e.g. SBI, PNB etc

- Private sector competitors like HDFC, ICICI

Future market trends.

Advent of MNC banks.

STRATEGIES FOLLOWED

Segmentation Strategy

The market segmentation strategy can give a firm a commercial competitive

advantage. Axis bank considers the customer as the base for segmentation.

This strategy crosses over traditional boundaries set within the company. It

takes into account important issues such as market demographic and

Psychographic Variables of niche markets currently being served or

targeted.

DemographicVariables

Demographic segmentation variables are amongst the most popular bases for

segmenting customer groups.

o Location

- Metros

o Occupation

- Business persons

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- Salaried class(both govt and private)

- Working woman

o Age

- Senior citizens

- Minors

Psychographic Variables

o Lifestyle

- The people who believes in modern banking i.e. internet banking

(icontact, mobile recharge, e-payment, travel currency card etc.)

o Social class

- Many Marketers believe that a consumers "perceived" social class

influences their preferences for products & services.

Targeting strategy

The targeting strategy involves segmenting the market, choosing which

segments of the market are appropriate, and determining the products that

will be offered in each segment.

Target market

A 'target market or target Audience is the market segment which a particular

product is marketed to. Market Targeting is the process in which intended

actual markets are defined, analyzed and evaluated just before the final

decision to enter is made.

o Corporate banking market: this market target the industries

o Capital market: this segmented is targeted on the long term needs of the

individual as well as of industries

o Retail banking market: this segment is for the retail investor and provide

them short term financial credit for their personal, household needs

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Selective specialization strategy

o This is a multiple-segment strategy, also known as a differentiated

strategy

o Different marketing mixes are offered to different segments. The product

itself may or may not be different - in many cases only the promotional

message or distribution channels vary.

o I.e. the bank selects a number of segments, each objectively attractive and

appropriate. There may be little or low synergy among the segment but

each segment proves to be worth full of it.

o For example, axis bank have different set of credit cards, each targeted at

different set of people i.e. segment and each one has its own importance in

bank.

Positioning Strategy

Positioning has come to mean the process by which marketers try to create an

image or identity in the minds of their target market for its product, brand, or

organization.

Axis bank has positioned itself as a bank which gives higher standard of

services through product innovation for diverse need of individual and

corporate clients.

Axis banks are positioned as the technically advanced

They highlight following points in their positioning statement:

o Customer centric.

o Serviceoriented.

o Product innovation.

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These are the main strategies followed by axis bank so as to achieve

competitive advantage over others.

CHAPTER 5 : REPOSITIONING OF BRAND UTI TO

AXIS BANK

The New Logo

TO

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The logo depicts a strong growth path for the bank

supported by a strong base, indicating that the bank is

moving on from a position of strength

REPOSITIONING OF AXIS BANK

UTI bank is a well-known brand name that quickly comes to our mind. But on July

30, 2007 the bank has changed its name to AXIS BANK. Many of us might be

wondering why its name has been changed and some of us may not like to change

a well-established name. The initial reaction is as usual many of us didn�t link it.

Similar thing happened when BOMBAY became MUMBAI. But after a few

months we got accustomed to MUMBAI only. So what happens to UTI now, we

take a look at it. UTI was a government institution, its subsidiary UTI Bank has

been categorized as a private sector bank, according to RBI guidelines. UTI brand

was given in 1994 by its promoters and UTI Bank could use the brand only till

January 2008 as per Government directives. After the split of UTI, entities like

UTI Securities, UTI MF and UTI Bank were all allowed to retain the UTI brand

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name for a while. Now that it is time for UTI Bank to shed the brand name, it has

opted to go for the more modernsounding Axis Bank. The recommendation for

name change to Axis Bank has aris......

Change is good’, especially when it comes with an image makeover to a better and

upmarket product positioning. In the Indian context at present, a bank, mobile

phone operator and an airline are hoping that their re-branding exercise will help

them achieve that. .

For UTI Bank, the re-branding story was slightly different. Making a clean break

from its UTI heritage, Axis was the name chosen to represent its new global

identity. Bringing in a set of twins to build an emotional connect with the new

brand, for UTI Bank it was an attempt to build its image of being a professionally-

run private bank with everything else remaining the same.

Sumanto Chattopadhyay, Executive Creative Director, Ogilvy & Mather, South

Asia, says, “The change of name from UTI Bank to Axis Bank is precisely that:

Only a name change. Everything else about the brand remains the same. Axis is a

strong name with an international aura to it. It is very much in keeping with UTI’s

success story in the private banking arena.”

Rolling out a multimedia campaign to announce the change of name from UTI

Bank to Axis Bank, it simultaneously reassured customers that the change of name

will in no way affect the services offered by the bank. The creative platform

adopted for the name change campaign was based primarily on twins: siblings

whose names are different, but are identical in every other way. Television was

given a priority as it gives the maximum reach amongst the mass media channels.

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Besides the mass media channels, the 2,500-odd ATM locations were also used to

convey the name change message.

Hemant Kaul, President - Retail, Axis Bank, explains that the name Axis is sharp,

short, simple and acceptable in any geography or language. “This is in line with

our global expansion aspiration. Axis Bank now has a pan-Asia presence — in

Hong Kong, Singapore, Shanghai and Dubai. UTI has a connotation of being a

PSU. The name ‘Axis’ reflects a more private sector identity, it reflects what the

bank is more closely than UTI Bank did. Axis reflects new thinking.” Also, as

Kaul elaborates, banking is a high-involvement product and involves product

safety and security. Therefore people had to be assured that nothing would change

with the re-branding from UTI Bank to Axis Bank.

THERE ARE 3 MAIN REASONS

1. They had to give up the UTI name after using it for 13 years as we were not

prepared to accept terms and conditions (including royalty) from UTI AMC

The decision to rebrand itself was taken by the bank as it was allowed to use

the 'UTI' brand name for free till January 31, 2008, beyond which it had to

pay royalty for using the name.

2. The recommendation for name change to Axis Bank has arisen from the

existence of several shareholder-unrelated entities using the UTI brand, and

the consequent brand confusion that this generates

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3. The name UTI bank was changed to AXIS bank as UTI gave a look of

government sector bank. They had to change our name to have our own

brand and identity. "The name was taken into effect consequent to the

approval of shareholders, Reserve Bank of India and the central government

(Registrar of Companies).

• The UTI brand is owned by UTI Asset Management Company

• The bank would change logo and colour of logo the bank is likely to spend

around Rs 50 crore in the re-branding exercise.

• The bank acquired the services of Ogilvy & Mather (O&M) to design and

implement the rebranding campaign.The new name was chosen considering

the bank’s pan- Indian as well as international presence.

•• The first time that a bank has dropped an established brand for an unknown

name.

•• The name Axis is chosen as it is simple and it conveys a sense of solidity and

a sense of maturity. It also has a universal appeal.

MARKETING OBJECTIVES

Banks wants to achieve following marketing objectives by the end of year 2011:

To get the market capitalization 500 crores

To get the 200 crore retail investment

To get 125 crore corporate investments

To get the 175 core capital investments.

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At present Axis bank is ranked at the 6th position (overall )by its market share and

capitalization and 3rd in the private banks category. It wants to get the 3 rd position

in overall Indian banking market.

RECENT DEVELOPMENTS

Shikha Sharma was named as the bank's managing director and CEO on 20

April 2009.

As on the year ended March 31, 2009 the Bank had a net profit of Rs

1,815.36crores

The bank now has 835 branches including extension networks across 30

States and 4 Union Territories.

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The bank also has overseas offices in Singapore, China, Hong Kong and

Dubai.

Crosses the 3,723 ATM mark in 2009

Launches Platinum Credit Card, India's first EMV chip based card .

Axis Bank is now trading at Rs 911.85 (17th Sep).

AXIS BANK FIVE FORCE MODEL(PORTER’S)

NEW ENTRY

55

NEW ENTRY

Yes bank, Deutsche BankIndian Overseas BankVijaya bank

BUYING POWER OF CUSTOMER

THREAT OF SUPPLIERS RBI)

THREAT OF SUBSTITUTES (SHAREHOLDER OF CAPITAL MARKET)

AXISBANK

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CORE COMPETENCESTRATEGY

For the private sector banks:

• Differentiation on the basis of area coverage.

• Restricted Reach.

• Level of service is the same.

• Axis got advantage because of Product Innovation.

For the government sector banks :

• High level of service quality and through product Innovation.

• AXIS not any where near, but has created a different set of segment.

• `People who believe in the higher set of services

For the International Banks :

• Differentiated itself on the base of the reach and coverage to the people.

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• Service level is somewhat same.

• In the future these banks may create a problem.

Chapter 6 :CONCLUSION

A SUCCESSFUL MAKEOVER AS AXIS BANK

In 2007 the bank decided to have an identity of its own distinct from its parent

UTI-I. Thus was born a brand Axis - a word which connotes solidity and gives a

feel of transcending geographical boundaries. The Bank successfully rebranded

itself as Axis Bank in July 07 which has helped it in shedding the faint perception

of being a Government owned entity. This brand makeover was very well

executed, thus ensuring No slippages in the banks growth trajectory which was

evident from the 67% growth in its customer accounts to 9.9 mn during FY08 as

against 5.93 mn during FY07.

The Bank today is capitalized to the extent of Rs. 403.63 crores with the public

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holding (other than promoters and GDRs) at 53.72%.

The Bank's Registered Office is at Ahmedabad and its Central Office is located at

Mumbai. The Bank has a very wide network of more than 896 branches and

Extension Counters (as on 31st December 2009). The Bank has a network of over

4055 ATMs (as on 31st December 2009) providing 24 hrs a day banking

convenience to its customers. This is one of the largest ATM networks in the

country.

The Bank has strengths in both retail and corporate banking and is committed to

adopting the best industry practices internationally in order to achieve excellence.

Axis Bank currently has global footprints in four countries by way of 3 branches in

Singapore, Hong Kong, Dubai and 2 representative offices in Shanghai and Dubai.

It has also sought permission from the Sri Lankan Government to open a branch in

Sri Lanka in the current fiscal. In these locations it offers corporate credit and trade

finance solutions, debt syndication and wealth management services to NRI

population settled in these cities.

Promoters

Axis Bank Ltd. has been promoted by the largest and the best Financial Institution

of the country, UTI. The Bank was set up with a capital of Rs. 115 crore, with UTI

contributing Rs. 100 crore, LIC - Rs. 7.5 crore and GIC and its four subsidiaries

contributing Rs. 1.5 crore each.

SUUTI - Shareholding 24.09%

Erstwhile Unit Trust of India was set up as a body corporate under the UTI Act,

1963, with a view to encourage savings and investment. In December 2002, the

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UTI Act, 1963 was repealed with the passage of Unit Trust of India (Transfer of

Undertaking and Repeal) Act, 2002 by the Parliament, paving the way for the

bifurcation of UTI into 2 entities, UTI-I and UTI-II with effect from 1st February

2003. In accordance with the Act, the Undertaking specified as UTI I has been

transferred and vested in the Administrator of the Specified Undertaking of the

Unit Trust of India (SUUTI), who manages assured return schemes along with

6.75% US-64 Bonds, 6.60% ARS Bonds with a Unit Capital of over Rs. 14167.59

crores.

The Government of India has currently appointed Shri K. N. Prithviraj as the

Administrator of the Specified undertaking of UTI, to look after and administer the

schemes under UTI - I, where Government has continuing obligations and

commitments to the investors, which it will uphold.

ANNEXURE

QUESTIONNAIRE

Why the bank decided to change its brand name?

AXIS Bank wants to become an MNC bank, so the name change will

enhance image?

Was it have been very tempting for you to stay on the existing brand by

paying a higher royalty, given the cost and time involved in this exercise?

The UTI brand had a quasi-government sovereign ring to it, especially when

you go outside metros. That would have been an advantage, would you lose

it now?

Where do you position Axis Bank from the business point of view?

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In private sector peers, there are missing links, since most of them have a

mutual fund and insurance business?

The bank has often raised capital from the international market, rather than

making an offering to the Indian public. Why is it so?

Which are the other areas that the bank will branch out to, as you have raised

much capital?

Will the bank be looking at acquiring another bank, since you have adequate

capital?

The central bank has told your bank to put a succession plan in place?

FINDINGS

Axis Bank had done change of brand name partly because there are shareholder-

unrelated entities that carry the UTI brand, which was becoming increasingly

untenable... If there are no shareholder relations between the two organisations, so

they cant actually share a common name.

When UTI was split into two vehicles, the brand was given to UTI Mutual Fund

and others were permitted to use the brand only till January 2008. When it became

clear to them that it was no longer tenable, they decided to have a brand of their

own. The name Axis was chosen as it means a line of reference, around which

everything is measured.

Axis bank felt that with time, people will think of them as Axis Bank. The test is

whether in the next six months people would forget their old name. Otherwise,

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nothing really changes in the bank. They raised capital worth Rs 4,500 crore ,

which would help Axis Bank start off on a strong footing. They felt that this capital

would last at least for three years in the case of pure organic growth. One of the

few banks to have gone in for a brand makeover, UTI Bank has now assumed a

new name, Axis Bank. PJ Nayak, the chairman and CEO of Axis Bank, seems to

be quite clear about the way forward, the change in identity, the positioning of the

bank, the pros and cons of pursuing organic growth, etc.

In recent years, they have contributed more than their fair share on restoration of

the UTI brand. But when it was clear to them that there was no other option, they

decided to bite the bullet. They decided to assume their very own identity. The UTI

identity came to them from the undivided Unit Trust of India (UTI). The split of

UTI was the starting point for what was eventually a search for a new identity.

Axis banks customer base is very different from the customer base of a mutual

fund. So they were never really able to ride on the brand. The pace at which their

customer base has grown indicates the level of customer service they provide.

Also, the UTI brand was seen as a public sector brand. They are a board-managed

private sector entity. By changing the name, they could reinforce this image. They

have taken the first step towards seeing ourselves as becoming an MNC bank from

India. they have presence in four overseas locations - Singapore, Hong Kong,

China and Dubai. This is part of a journey to become a pan-Asian bank and then,

eventually, a bank that is more multinational. They are foraying into smaller towns

and entering district headquarters in a big way. In the next thirty months, they want

to be present in 450 district headquarters. they have received licences to open 150

branches and 500 ATMs. They plan to open 125 branches by July 2008, half of

which would be in large cities. Axis bank are also setting up a large agri financing

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business for which they need to be close to farmers, hence they are opening

branches in villages.

Besides, the bank has set up priority banking branches for customers with deposits

of over Rs 5 lakh. It is one of the most fastest growing customer base of our bank,

growing at 4% each year. They have three such specialised branches now, and plan

to have one each in all the major metros. Commercial banking is something Axis

Bank have tried to focus on since their inception. As the first step towards

diversion, they have set up an AMC to manage a private equity venture. Axis Bank

would be in a position to launch the first tranche of the fund by end of September.

The AMC will provide equity support for infrastructure projects. There are not

many private equity funds here, focusing on infrastructure projects.This is partly

because wholesale offering always fetches a better price, and they also decided to

cast the net wider than the Indian shores. The funds were raised through a

combination of GDRs and QIPs. they also saw to it that they go for uniform

pricing of shares, which has in turn protected the minority shareholders. Axis Bank

is growing at 45-50% every year. If they grow purely organically, this capital will

last for 3-4 years. But they are looking at other areas within the financial services

domain. Going forward, Axis Bank could also look at evolving into a group.Within

the banking space there are not many opportunities available. Many of the old

private sector banks have a size of -three months of our growth. Also, there are

issues relating to the integration of technology platforms and human resources.

They have a clear business model, under which they see no value in a merger or an

acquisition purely to acquire branches; they get licences easily from the central

bank. May be, they could look at such options in the wider financial services space,

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beyond the mainstream banking sector.The succession plan to place with central

bank is to be decide by the board of directors.

REFERENCES

Websites :

www.wikipedia.com

www.thehindubusinessline.com

www.marketingritson.com

www.marketingprofs.com

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www.economictimes.com

Books :

Consumer Behaviors & branding –S. Ramesh Kumar.

 

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