Brand Dilution, Indian Whisky Drinker and Loss to Brand

Most Indians dilute their whiskey. They even do the same to single malts. By adding water the whiskey’s potency is watered down.  Sixty ml is often raised to 200 ml.  This watering down comes in different versions like water and ice, water and soda, only ice, only soda. Cheers.

Contrary to whiskey, brand mangers fear and even dread dilution. High performing brands thrive on strength of unique and favorable associations. Brand is encoded in memory as a pattern of relationship between nodes or concepts.  The brand aspect/nodes such as fizzy drink, cola, youth and rebel identity are both interconnected and linked to Pepsi. Brand tends to get diluted when it is branched into an incompatible category (Pepsi Shoes) or a new player tries to infringe by copying the brand with an inconsistent category product (Fair & Lovely toothpaste).

Why is brand dilution feared? It is because the dilution can have disastrous effects on brand’s sales performance. How does it happen? Brands are inhabitants of memory city and they dwellings come in the form of associative networks.  By wrong extensions or infringements, their associative network suffers when new undesirable associations are attached to them. For instance, the category, user, use, attribute and benefit nodes/concept are unambiguously and strongly linked to Pepsi brand (brand meaning) which are both unique and favored by its target consumers. By linking Pepsi name to shoe category, the name is likely to evoke an amalgam of associations comprising of shoe category and Pepsi.

How do brands operate through memory? There are two processes. First is brand name accessibility (BNA) is ease with which brand name is recalled from memory when a brand aspect is presented as a cue (e.g. how likely is that word  ‘cola’ or seeing ‘blue color’ is going to retrieval of Pepsi brand). The dilution occurs when BNA is reduced. Second, is aspect accessibility (AA), which implies the likelihood of a brand aspect coming to mind when a brand is presented as a cue (the likelihood of freshness coming to mind one thinks about Close Up).  Brand dilution occurs when brand name accessibility and aspect accessibility decreases.

How does dilution manifest? (a) When brand access is decreased. It takes longer time for consumers to access the brand response to getting a cue. The recall suffers. (b) Reduced speed in recognizing and accessing brand associations. Lack of certainty what brand stands for. (c) Both reduced speed of brand name recall and delay in recall and recognition of associations is likely to cause the brand to get out of consumer consideration and brand choice.

How does dilution happen? At the heart of dilution is linking of two associative networks in memory by either an external party (brand infringement) or extension created internally and its effect. Two associative networks (the original brand and extension/infringed brand) are linked by brand elements (name, color, logo, slogan etc.) which cause confluence of associations flowing from one to the other. For instance, when Ponds brand was extended into toothpaste category the new networks Ponds (dream flower talc and cold cream) were linked with toothpaste (hygiene, bathroom, odor, cavity and Colgate brand) it caused sharing of associative networks. What effect does it have on brand name accessibility (BNA) and aspect accessibility (AA)?

The expanded network is likely to have adverse effect on accessibilities. How would the brand knowledge be retrieved in new situation? A brand cue (like fragrant talc) is likely to fire up not only associative network of Ponds (master brand) but also extension (toothpaste). This spread would activate nodes spread across two categories. This firing is likely to cause these nodes (stored information) to get to mind (information retrieval) in a competitive way slowing down the brand recall. How about aspect accessibility? So when Ponds brand is given as a cue it is likely fire not only its earlier network but also new one. The brand’s newly forged linkage with toothpaste is likely to fire nodes such as dream flower, talc, attraction, oral hygiene, bad breath, prevention, etc. This evocation would have effect of slowing the recall of key proposition/aspect of the master brand. Thus the brand is likely to suffer on account of late recall, recall of association and diverse in coherent association leading to adverse effects on brand’s sales performance.

Moral: the dilution of whiskey is delectable only when it is mixed with right stuff. Brands also need to be mixed with right stuff otherwise the effects are disastrous.


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