Success in business is often the result of spotting an opportunity before someone else does. But it is important to recognise the difference between opportunity and opportunism.
It’s not just a matter of semantics because every potential avenue of business that beckons is not the right opportunity. It is a genuine business opportunity only for a brand that can leverage it over the long term. That depends on the fit between what the brand stands for — its core — and the contours and characteristics of the potential business.
A new opportunity opened up when India’s ‘open skies’ policy was announced. But was it an opportunity for everyone? Sahara, a brand with cachet mainly among the lower-middle class in north India and no history of delivering service to a higher socio-economic group, jumped in. But we soon saw that being “emotionally yours” was not enough to win the loyalty of airline fliers.
Similarly, Bombay Dyeing started Go Air, again without a brand core fit. Recently, Nusli Wadia acknowledged that it was probably a mistake to have got into the business.
Entering the airline business was an act of opportunism on the part of both brands. Ditto all the guys who got into real estate in the 1990s —Essar and Videocon among them.
Wanting to go with what’s hot is not a malaise limited to any country. Remember all the dotcoms in the 1990s? Go.com backed by the Walt Disney Company, pets.com, the bizarre flooz.com, all attracted a pile of funding only to fail.
Or think of Godrej in consumer electronics. Godrej refigerators for years, had a fair market share, especially in Western India. But it was probably more a case of buying a ‘trusty basic’ product rather than a case of buying a technologically superior appliance out of a wide choice of offerings. What share will it command now, given that the LGs and Samsungs of the globalised world have come into town?
Consider another “sunrise sector” attracting opportunists. A 2006 FICCI-PWC report projected that the Indian media and entertainment industry would be worth US $18.3 billion by 2010. Several companies have jumped into the TV channel game.
Can a group known for general entertainment effectively launch and run a news and business channel? Can an entity known for its TV news capabilities effectively launch and run a general entertainment channel? The concept of a ‘brand core’ goes beyond image synergy across sectors.
On the other hand, consider ITC’s foray into foods, riding on the back of its fantastic distribution network that reaches every paan-waala. A great strength that makes this category a real opportunity for ITC. Not surprisingly, ITC’s turnover in foods is set to reach Rs 22 billion, which would make just this part of its business larger than Marico Limited!
In a nutshell, opportunism is the act of a business buccaneer jumping into an arena fantasising about “Why can’t I too make money here?” while the opportunity-seeker asks, “What makes it right for me to enter this space?”
In the business of building a brand, well begun is not ‘half-done’; it is quite often merely ‘half baked’.
© HT Media