When choosing an outfit, not many consumers give much thought to the ingredients that go into its making. And yet, those very ingredients and the quality or function they provide are the very reason that customers return to their favourite brands the next time they go shopping. So the question arises: What is ingredient branding and how important is it?
Ingredient branding is the opportunity to create an image of excellence and quality for a product – a unique differentiating point. How and why brands would do this was the subject of the session comprising moderator Manohar Samuel, President Birla Cellulose; Prem Sadhwani, DOW Chemical; Rajesh Jain, CEO, Lacoste; and Dr. Sibichian Mathew, NIFT.
A brand comprises quality and innovation. Of these two, Jain was of the opinion that quality is of prime importance and that this quality is achieved due to the ingredients used – the thing that makes consumers willing to pay that price and return to the brand. Regarding the communication of the ingredients to the consumers and what it adds for them, he said: “We do communicate the same but without getting into the technicalities. We make them aware of some of them but the rest are implied in our quality.”
Sadhwani took the perspective of the value that ingredient branding brings to the brand. He said that while working on the product, many times the brands disregard the importance of the ingredients and, thus, miss the opportunity to differentiate themselves in the minds of the consumer. He said: “The most valuable investment we can make is to increase the brand’s knowledge of the ingredient in a way that will help promote the sales.”
In contrast to the above two perspectives, Dr. Mathew drew attention to the fact that non-materials are also highlighted under ingredient branding as ways to increase brand value in consumer perception. According to him, brands can and should highlight the labour involved, such as in handmade products, the location in which the ingredient originated, and even the processes that go into the creation of the final product. “Every element that goes into making the product can provide differentiation,” he said.
The panellists also shed light on the challenges faced with ingredient branding. Some of these were consumers being unaware of the ingredients and not being very interested in gaining awareness, the ingredient being invisible and hence difficult to prove performance to the customer, and the disclosure of ingredients being of value only if the consumer were aware of them. From the brand perspective, the division of marketing budgets to promote the ingredient with the ingredient brand is also a point of contention.
The challenges notwithstanding, Jain was firmly of the opinion that the future lies in ingredient branding. He concluded by saying: “In traditional India and especially in the unorganised market, ingredient branding is very successful. In the future, organised markets may follow.”