Brands perhaps are the most valuable assets an Organization can have. Brands create an image for themselves through the constant attention and nurture given to them by the organization. Over a period of time some of the brands become the bread winners for the organizations. In case of profit organizations to call them bread winners is not enough, they need to be called gold winners. Any damage to the reputation of these brands can really change the scenario for the organization.
If the brand is a Corporate brand assuming the role of an umbrella brand the dependence of the organization is hundred percent on the brand as the organization is itself the brand. Since the brands are associated with tangible and intangible benefits, the logo and the trademark, they require a legal watch as well, and need to always stay within the frame work of business regulations and law in many areas like safety to consumer, consumers interest, making claims, any side reactions and information regarding the impact the brand consumption can have. This list is long.
Corporations spend huge sums on the promotion of brands in many ways. One popular and widely practiced method is advertising which is very expensive as it reaches huge numbers. Even when an organization spends about five percent of the sales revenue on advertising a brand the amount in absolute terms is substantial. Having nurtured the brand for years if any regulation bans advertising the brand in public interest it can be a serious problem for the brand owner. How to keep the brand in the minds of the consumer becomes a major issue.
It is to be expected that the brand owner will not just surrender but will need to find a creative alternate way to keep reminding the consumer. One such way is to create another product that can be advertised legally and name the product with the same name of the brand that can not be advertised. These brands have been called surrogate brands because they are growing in the womb of another mother.
We find in the market several such brands, for example mineral waters and sodas carrying the banned alcoholic drink names. Retail outlets are being given the names of cigarette and tobacco products. This is done by the owners of the brands to make sure that the consumer recollects the brand that could not be advertised and develops an urge to consume the brand. Governments are worried about this practice as there is a possibility that the very mention of the name may raise the urge with in an individual to consume an alcoholic product or a tobacco product which is not in the interest of the public health policy. So often Governments get into a dilemma on how to deal with such products.
For the Corporation that owns such brands, the worry is not limited to how the regulatory bodies react but how the public, the consumer would react. Any serious ethical protest from consumer side can damage the brand more than what the Government could do as the consumer would dismiss the brand and the related products from his mind set and perhaps develop a negative attitude towards the Organization itself. This can have a domino effect on the other products that come from the same organization.
The strategy of using the brands name on other products that can be advertised seems to be working. It appears that the consumer is liberal and ignores that the name can be given to other products without causing any damage or the consumer is unaware of the history of the brand’s name. The products that can be advertised but named after the products considered injurious and harmful to health and banned from advertisements in some countries seem to assume a “transformational” role. That is, they are peace ambassadors and subconsciously mitigate the public hostility towards the other product.