Clear purpose underpins health of service brands
The service sector experienced explosive growth since the launch of the BrandZ™ Top 50 Most Valuable India Brands in 2014. With the addition of six service categories, this year’s expansion of the ranking to the India Top 75 presents a portrait of service sector growth and its impact on India’s brand landscape.
The added categories are: technology, including consumer online brands and business-to-business IT services; couriers; fast food; entertainment (TV stations); and transportation (Taxis). These categories represent over one-third of the 30 Newcomers brands.
The addition of these brands strengthened the brand equity of service sector overall, as indicated by the rise in the service sector scores in the BrandZ™ components of equity. Scores for Meaningful Difference (creating affinity with consumers in relevant and distinctive ways) increased from 112 to 120 between 2014 and 2018. Scores for Salience (coming to mind easily when the consumer is considering the category) increased from 104 to 136. An average score is 100.
The service sector categories and brands added in this year’s India ranking drove most of the growth. In the 2018 ranking, the original service brands, those included since 2014, scored 114 in Meaningful Difference. The service categories added this year scored 130. Similarly, the original service brands scored 121 in Salience and the new service brands scored substantially higher, 161.
In every BrandZ™ India ranking until this year, FMCG was the powerhouse of brand equity. This year, the new service sector brands challenged FMCG brands, which scored only slightly higher in Meaningful Difference, 133, and lagged the new service sector brands in Salience, scoring 154, a healthy score but lower than the score of new service brands.
In vQ, the BrandZ™ metric of brand health, the service brands added in the 2018 ranking scored slightly higher that the brands in the ranking overall, an average of 113 compared with 110. Scores of the new service brands and the brands overall are comparable across four of the five components of vQ, which are: Purpose, Innovation, Communications, Experience, and Love.
The significant gap is in Purpose, with the new brands scoring 118 and brands overall scoring 113. Brands like Ola, the ride-hailing service and Naukri.com, the job hunting online site, are especially high in purpose, 126 and 127, respectively. Consumers see these brands as making their lives better.
Purpose is the foundation of brand health. The new service sector brands have demonstrated an ability to start with a clear purpose and present it to consumers in a Meaningfully Different way. Their accomplishment holds lessons for all brands, but especially for FMCG brands, which have led in clarity of Purpose until now. Indian consumers reward brands that make their lives simpler and better.