Cyrus Mistry and the $5 bn brand consumers cannot avoid

Can you remember the last time you watched a programme on TV for a couple of hours and did not see a commercial for any Tata brand?

Today, it’s difficult for an average consumer to avoid a Tata brand in his or her normal consumption pattern. For air-conditioners, water coolers, water dispensers and water purifiers, there’s Voltas. In cars, you have the Indica, Indigo, Manza, Sumo and, of course, the Nano. In beverages, you have Tata Caf, Tata Tea, Tetley Tea and Himalaya water. In entertainment, you have Tata Sky services. In the hotel business, you have the Taj, Vivanta and Ginger. In jewellery, there’s Tanishq. In watches, you have Titan and the brand extension, Titan Eye, for spectacles. In retail, there’s Westside, Landmark, Croma and Tashi. In telecom, Tata Indicom and Tata DoCoMo are major players.

That’s a long list of brands - and promises.

“I think the world over realisation has dawned that as economies develop and consumers have more spending power, people don’t buy products, they buy a promise. A brand is nothing but a way of expressing a promise. The future will undoubtedly belong to the brand - and the Tatas will not be left far behind,” said R Gopalakrishnan, director of Tata Sons, chairman of Rallis India and Advinus Therapeutics, and vice chairman of Tata Chemicals, in an interview with tata.com in July 2000.

“Today, the Tatas represent assurance, reliability, a sense of nationalism, value for money, and such other attributes that have been built over several decades. Irrespective of the product you are making, those are the attributes you would like to be known for, whether it is through a wrist watch, a piece of software or a car. It is for this reason that the Tata name goes well with a diversity of products - from tea and salt to an Indica car, software development and steel,” Gopalakrishnan had said in the same interview.

[caption id=“attachment_139168” align=“alignleft” width=“380” caption=“The adjectives that one didn’t see before Tata took charge as chairman in 1991 are adjectives that very easily come to mind now - aggressive, vibrant, exciting, multinational, risk-taking. Reuters”] [/caption]

What does all this mean for Cyrus Mistry? “He (Gopalakrishnan) also spoke about how the Tata brand has evolved over the years. From $300 million in 1998 it has gone and become a $.5 billion brand. They are also expecting this number to double by the end of 2011-12 when they do the next assessment of the brand valuation,” moneycontrol reported.

The adjectives that one didn’t see before Ratan Tata took charge as chairman in 1981 are adjectives that very easily come to mind now - aggressive, vibrant, exciting, multinational, risk-taking.

It’s in the businesses and geographies that Ratan Tata has led the group into in the past decade that makes us think differently about what the Tata brand represents. In the acquisition of Jaguar Land Rover, for example, the ‘value-for-money’ tag that the Tata brand name has stood for is pushed into the background, but world-class and multinational come to the fore.

“Tata Motors on Wednesday announced its entry into the international luxury car market with some style as the company snapped up two of Britain’s most famous names in automobile manufacturing, Jaguar and Land Rover, in a $2.3 billion deal with Ford, their American owners. “Ford says Tata to Jaguar’’ declared a front-page headline in a British newspaper as the country woke up to the loss of a bit of its motoring history in a classic case of the empire striking back,” The Hindu had gushed .

The Corus buy instantly made Tata a risk-taker - and a global player.

“The Tata Group is celebrating its acquisition of the Anglo-Dutch steel firm Corus, and the catapulting of Tata Steel into world steel’s big-five status (by revenue). It should. The $11 billion deal is a marker in the ground….But Tata-Corus is the largest out of India, and is done by a private sector entity of its own volition, away from the shadow of state influence. For these reasons, it bears noticing,” said Harvard Business School’s Working Knowledge.

When this commercial - We also make steel - was made, there weren’t many products in the Tata stable which were consumer-facing and exciting, save for Titan watches. What else did Tata make? They made salt, soap (Tata OK, for example), airconditioners (under Voltas), tea, trucks, and they ran hotels under the Taj umbrella. Except for the Taj, which had a few properties abroad, most of their consumer-facing brands were India focused, and, with the exception of Titan, and, to an extent, Voltas, hardly exciting.

Now, there’s a launch or an acquisition every few months. And every brand that is launched or bought has to pay royalty to Tata Sons for the use of ’the group mark and logo’ thanks to the Brand Equity and Business Promotion Agreement, which is signed by Tata Sons and individual group companies.

That’s an addition to the bottom-line of Tata Sons even as there’s appreciation in the brand valuation.

The brand has become so much more than it was when Ratan Tata ‘inherited’ it. In addition to Tata standing for assurance, reliability, a sense of nationalism, value for money and similar attributes before Ratan Tata took over, attributes like exciting, vibrant, diversified, international, aggressive and risk-taking have been added -together handing Cyrus Mistry a $5.5 billion (and growing) brand to manage.

Thankfully, there’s one attribute that Mistry has which should be of immense help to him as Ratan Tata hands over the baton. It’s an adjective that none associates with the Tatas - young.

“My only regret is that I am not 20 years younger because I think India’s going through a very exciting period in its history,” Ratan Tata had said earlier this year in an interview with CNN.

Well, Cyrus Mistry is 30 years younger…and he’ll steer the Tata empire through this ‘very exciting period’ in India’s - and Tata’s - history.