Ever seen tire ads on TV?
Remember the illustrious “Intel inside” campaign?
As a retail customer – do you or I go about buying chips for PCs or tires or for that matter cooling towers?
Then what are these ads doing – Why are they targeted at the retail customer? This can be thought of as a way to create a pull – If there is enough awareness about the cooling tower and the brand is visible, then the new 5 star hotel is forced to buy this tower or in other words the 5 star hotel pays a premium for this tower so that it can extract the benefits created by this ad campaign.
Precisely why Intel chips sold like hot cakes. There are stories of fledgling PC manufacturers doing well because of the INTEL chips embedded in them.
Remember the third grade biology lessons of Brood Parasitism – The cuckoos laying their eggs in the nests built by other birds – similarly, the companies extract the fruit of the brand value created by another marketer – the only difference being that these companies cannot free ride like the cuckoos and end up paying a premium. But shelling out a premium is still friendly on their pockets. It is better than investing in a marketing campaign not knowing what its result would be. Here, the clever business men pay the premium after the campaigns have succeeded and command intense brand recall among their clientele.
There are well researched topics in marketing called “ingredient branding” – microprocessors are ingredients of a PC; sweeteners are ingredients of beverages and readymade foods. The oft quoted examples in this space are Intel, NutraSweet etc. For those who would like to know/recall NutraSweet, here is the story
NutraSweet, an artificial sweetener found in around 3000 beverages/foods, started advertising using a theme – “why some things taste better than others?” – A revelation about the features of an ingredient that went into products consumed by everyone on a daily basis. After a few years, there was a remarkable change in consumer preference for NutraSweet and products that used the sweetener were clearly associated and identified.
But this article is not about ingredient branding – the concept I’m trying to put forth is about products that are invisible to the retail customer like cooling towers which can’t be termed ingredients of a 5 star hotel. A tyre for example is not targeted at the retail customer, so in some sense it is an invisible product. So also the sweetener that goes into Pepsi or the spice that goes into Frito lays. Ingredients are subsets of this INVISIBLE product category.
So companies are awakening to marketing the INVISIBLE – they rope in the end consumers and kindle interest and goodwill about their products so that their immediate customer pays them more money. A good tactic – but caution is to be exercised as it may backfire. Since these products are invisible, the campaigns run over years before they yield results. Also, the campaigns if successful get so absorbed that the brand finds it difficult to enter unrelated areas. This can be seen in the case of Intel which would take pride in calling itself an innovating company (has several trademarks to its credit). But the consumer can never dissociate Intel from microprocessors…
So do not panic if tomorrow,
Healthy Chicken (poultry feed company) responds saying – “The burgers are yummy because we provide yummy feed to chickens”
An association of farmers also enters the race and says that “we produce yummy grains that makes the chicken feed yummy”
This is a healthy trend as the consumer is made aware of ingredients, invisible constituents that make life worthy, sorry YUMMY J