Never say never atleast in Business. You never know when you have to say yes to things which you would have rejected outright earlier.
Bajaj Auto is a classic case. A company which was known oinly for scooters soon became only a motorcycle company. The new young chief outrightly ruled any role of scooter in the company. Motorcycles were the new and younger kid on the block just fit for the young India. Bajaj cannot be faulted as that was the major thinking then. Scooters were rejected by the buyers. However, perhaps this was due to poor quality and motorcycles offering a better value for money.
Come in Honda motors who changed the game. Due to the older agreement between Hero and Honda, Honda could not get into motorcycles right away. So, it started with scooters like Eterno and Activa which were much better compared to the older scooters. People took it up and soon scooters started to be visible all over once again. Clever marketing and designs were the game. Soon even Hero motors was making scooters.
Once, Goa famous for its renting two wheeler renting business had mostlt motorcycles. Now it has just scooters. Scooters have one big advantage that one can carry something on them. They have all those carriers and some foot space where things can be kept. This all is so integral to life in India where one purchases things and needs to keep them. Motorcycles had no such space.
I was always wondering what is Bajaj thinking on this? Perhaps they erred by not listening to the old warrior and letting go of a product which was just theirs.
So it seems now some thinking has begin. Bajaj is looking at reinventing its iconic scooter Chetak:
Rajiv Bajaj has uttered the ‘S’-word, finally. For about six years, the managing director of Bajaj Auto has been vocal about shutting the doors on scooters and becoming a “motorcycle specialist”. But there is a twist to this tale. He told Business Standard he would look at re-entering thescooter segment, as that’s a very “logical space” for future growth when the company has reached a significant scale in motorcycles. However, he would first want to “earn the right to do it”. In 2009-10, Bajaj Auto had stopped production of Kristal, its last scooter model.
Bajaj told Business Standard in an interview: “Today, we are humble enough to accept we have to do the motorcycle game right. But if in five years we become one of the top two, how do you grow the company? After you have 30-40 per cent market share, I cannot grow motorcycle volumes. So, when that saturation is reached, a very logical space for the company to grow would be scooters.”
Justifying his decision on Chetak, Bajaj said whenever the company wanted to make scooters, Chetak could be one of the potential brands, because of its iconic status. Chetak, named after Rajput king Maharana Pratap’s stallion, was launched in 1972 and enjoyed a monopoly during the days of the ‘Licence Raj’. At its peak, Chetak had a waiting period of 10 years and was promoted under the tagline ‘Hamara Bajaj’. The last Chetak was produced in 2005.
But can a dead brand live again? Reviving a brand that expired more than a decade ago would entail purely working with memory, as opposed to, say, giving a not-quite-dead brand another shot at life for all it is worth, or playing directly to a hardcore but small group of loyalists.
In the last decade or so, for example, American agri- and food major Bunge couldn’t turn around Dalda, which it had acquired from Hindustan Unilever (HUL) for less than Rs 100 crore. Neither could Dabur prop up Binaca, or Hindustan Lever Hamam. Let us not even talk about Gold Spot and Citra, which Cola-Cola bought from Ramesh Chauhan in 1994 along with Thums Up and Limca. Of course, the reasons for brand demise are different: Some new owners didn’t really care how the brand performed in the market – they were only too happy to kill them to bolster the prospects of some other brands in their portfolio. In other cases, the new owner read the market wrong or simply failed to keep the momentum going. For some others, keeping a brand low profile was a business call. So PepsiCo uses Uncle Chipps in some markets to fight local brands. HUL has pressed Hamam into regional duty.
What are the things brand owners need to keep in mind while bringing a dormant brand back into the market?
While you are busy assessing the potential of your brand, don’t give short shrift to communication. Did your brand have a famous ad campaign? A well-recognised brand mnemonic perhaps, à la Onida Devil? You might consider bringing it back to reconnect, but communicate it in a way that is relevant today. PR and word of mouth could be less expensive ways to extract the most from a comeback story, but you also need to commit a certain level of marketing support. Make sure you focus on the “new” and don’t just dwell on the past.
Mind you, brand familiarity alone does not guarantee success. As Professor John F Sherry Jr puts it, the task isn’t as simple as foisting these brands on “softhearted, dewy-eyed, nostalgia-stricken consumers”. As long as there is a market for it, you have to make sure how a given product can be changed to meet contemporary performance standards.
Consider the Volkswagen Beetle, which rose from dormancy and came back into the reckoning in an updated version that was both nostalgic and contemporary. It was rebuilt on two planks – nostalgic reassurance and modern functionality. These are the game changers – the ideas and concepts that transform a brand from being not-quite-there to back-on-top. One of these game changers is to listen to what customer want or expect from the brand and keep improving. That takes commitment to change and the ability to rethink current ways of doing business.