Marketing Question

In the pink with branding strategies

Health brands such as Eu Yan Sang eschew the hardsell, preferring the softer options such as nurturing emotional bonds.

The retail market and in particular the health food segment within it is a competitive one and a good example of how branding can make a difference.

Here some similarities as well as key differences can be seen in the branding strategies of two of the biggest players in the Singapore and regional market. Some part of a company's strategy may depend on its origins and the range of products it has. For example, Eu Yan Sang positions itself as a global healthcare and wellness company with a strong foundation in traditional Chinese medicine (TCM).

Eu Yan Sang has its origins in a shop providing quality Chinese medicine for tin mine workers in Malaysia over 100 years ago and now manufactures and retails traditional Chinese medicine and herbs in Hong Kong, Macau, Malaysia and Singapore while also operating clinic services in Singapore, Hong Kong and Malaysia.

While it has expanded from its humble origins, CEO Richard Eu explains that the company has always based its concept on having its own shop and all its products under one roof. Its branding strategy has followed on from that.

Eu Yan Sang employed what Mr Eu calls a "monolithic" approach to its branding. "What this means is that you have a shop front and all the products within the shop carry the same brand," he said. The company has been able to benefit from having a range of products, which it has expanded over the years to target different segments and markets while maintaining the strength of its own brand.

But as part of the group's business growth he has now come up with sub-brands which Eu Yan Sang also owns. This is to cover for example, the lifestyle segment which it has expanded into. And the group will continue to expand, using this strategy as it reaches out to new markets.

The range of natural foods, health supplements and personal care products is retailed under sub-brands such as Honey Mart, Pro Nature, Yen and Zing and are available in its core markets of Malaysia, Hong Kong, China and Singapore. Another strategy which Eu Yan Sang has used is to buy over brands where that is appropriate in certain markets. For example, in Australia, it has bought over the Healthy Life brand.

For BRAND's range of products, Cerebos Pacific Limited relies on its well-known brand values and the long association of its target market with the brand.

"In the health food category, the competitiveness comes from similarity in the ingredient types but quality and consistency of efficacies can differ, as such branding is especially critical because it is about building trust, and consistently meeting or exceeding the expectations of consumers," said Cerebos Pacific Limited’s vice-president for regional strategic marketing, Pauline Png.

In this respect, "BRAND's is a market leader in all the markets we play in, namely in the Brain and Body Wellness as well as the Skin and Beauty Wellness categories." she added.

"At this point, we are embarking on a journey to build Purpose-Inspired brands so that they become 'lovemarks' based on deep consumer insights and relevant impact to their lives not just on a functional level but on an emotional level as well," Ms Png said.

Despite the tough market, both companies have been effective in differentiating themselves in the market. "We have set ourselves apart by being consistent in providing benefit-driven quality products with stringent processes in manufacturing, innovation in marketing and recently, in delivering new convenient formats such as Beauty Jelly Strips on top of our Ruby Signature drinks format," said BRAND's Ms Png.

"We strive to delight consumers by communicating to them in relevant and meaningful ways. So, uncovering new and deep insights are our focus and then communicating them in the most compelling way is the challenge for our agencies. With product quality, meaningful communications and bonding, our consumers respond to us with loyalty and give our products to their loved ones," she added.

Likewise for Eu Yan Sang standing behind its products is an important element in setting itself apart. "You can't promote the brand when you don't have the substance behind it and to a large extent you have to build up your backend operations as well," said Mr Eu. "With our long history, we have a lot of domain knowledge that has been built up over the years that is different from other players," he added.

The kind of branding strategy used is also very important to do well in a competitive market. "We work as a team with our local markets and with our consumers to understand their needs better and are continually striving to help meet them. We have strategies to grow products in the mental, physical and beauty benefit categories and we try to help consumers choose the best products that suit their lives and needs," said Ms Png.

Eu Yan Sang on the other hand employs a much more market and business-focused approach, matching the strategy to the market.

"To a large extent our branding strategy depends on the market we're approaching," said Mr Eu. He elaborated that, for example, in Chinese-dominant markets where knowledge of TCM is already good, it will emphasise the Eu Yan Sang brand more strongly. But in others such as Western markets which may not understand the concept as well, they have chosen to invest to build their brand there. He gave the example of Eu Yan Sang's investment in the Healthy Life chain of stores in Australia as one such strategy.

Meanwhile to expand further, in markets where they have good market penetration but where there is saturation for their core products they are diversifying further. In Malaysia for example, Mr Eu said while they have good reach in the Chinese market, this makes up only 20 per cent of the population. To go beyond this they are reaching out into the halal market and will adopt appropriate branding.

(For academic use only. Source: In the pink with branding strategies, The Business Times17 July 2013, page 22)

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