Do increased discounts erode brand equity?

Naveen questions whether Big Bazaar's 'Sabse Sasta Din' promotion run on the 25,26 &27th of January in any way corrodes the brand name, coz he says 'at big bazaar there are discounts on a daily basis and so how can the 'sabse sasta din' help in building store loyalty n' patronage and as to whether its different from any other day?'

Let me first address the 'brand corrosion' part. The worst thing that can happen to brands is when they slide into becoming commodities. When does that happen? When the brand cannot differentiate either on prices or on its product/image.

Take a look at all the low price retailers in India. The rush of discounted sales that we witness all around have turned them into players who are in no way different from one another. In such a scenario, an even greater discount offered (sabse sasta din) helps Big Bazaar cut through undifferentaited clutter, establishing them as the 'best discounter' when it comes to retail sales. Remember this is in terms of 'perceptions'. That is, consumers tend to perceive them as the 'best discounter'.

For this image to be sustained, the advertised three days must see Big Bazaar go through with the 'sabse sasta' promise. Buyers must be able to avail of 'increased' discounts. On the contrary, if these three days see prices almost or similar to the ones that buyers encounter on 'normal' days, then the 'image' falls flat. The 'sabse sasta' campaign would be dismissed as mere gimmickry. The brand is on its way to 'equity erosion'.


manu bennur said…
sir, do people actually enjoy low prices even at a store like big bazaar, that is highly disorganised, where everything is like a huge pile and plain ambience and where the customer service is slow. or would people like to pay a few bucks extra and experience the difference at a store like star bazaar, which is the indian version of walmart.
Thks Sir

I gt my answer as all queries were answered.Thks again Sir. I saw ur response jus now as i went 2 Shirdi, Maharashtra and came back today.


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