The FINANCIAL — Think Coke-Pepsi, FedEx-UPS, Apple-Microsoft. Branding wars are more than just fun as they lead to greater experimentation and, most important, make companies pay more attention to customers. Companies have to take aggressive actions when entering a global branding war.
Marketing communication agency Sarke Consulting is moving to a new stage of development. As the Director of Sarke Consulting Revaz Charkviani declares, the two years of experience of the agency have showed that branding has become one of the most required services on the advertising market.
After the Russo-Georgian War Sarke Consulting has had two new clients: Geocell and Kor Standard Bank.
“Branding will be the priority for Sarke Consulting. This sphere has proved to have become the most interesting. In the near future we will announce vacancies on brand consultants. Sarke Consulting will intensify its development in other directions as well. At the same time we are going to be more active in advertising company planning, media planning and ad placement,” Charkviani told The FINANCIAL.
Although connected with the history of trademarks and including earlier examples which could be deemed “protobrands” (such as the marketing puns of the “Vesuvinum” wine jars found at Pompeii), brands in the field of mass-marketing originated in the 19th century with the advent of packaged goods. Industrialization moved the production of many household items, such as soap, from local communities to centralized factories. When shipping their items, the factories would literally brand their logo or insignia on the barrels used, extending the meaning of “brand” to that of trademark.
Bass & Company, the British brewery, claims their red triangle brand was the world’s first trademark. Lyle’s Golden Syrup makes a similar claim, having been named as Britain’s oldest brand, with its green and gold packaging having remained almost unchanged since 1885.
Sarke Group consists of six companies: Sarke Studio, Sarke Idea, Sarke Consulting, Sarke Research, Sarke Outdoor Advertisement and Sarke PR.
According to Charkviani, Sarke Consulting, a member of Sarke Group, was established as an independent agency two years ago and in one year it joined the list of the major tax payer companies.
Last year its turnover reached around GEL 10 million.
Sarke Group generates huge income and profit from Sarke Consulting, that’s 70% of the group’s total income.
“This year branding became very popular and more interesting. The Georgian market is not fully ready for aggressive branding, otherwise there would be many branding companies. There are only two branding companies in Georgia, us and Branding.ge. We consider Branding.ge only as our intellectual competitor because of their inactivity,” Charkviani stated.
In his words, while doing Brandplatform service, Sarke Consulting provides the companies with plans of what represents their brands strategically and not tactically. This service costs USD 25 thousand. This is a document which needs 2-3 months for elaboration. “Our service prices vary depending on the particular project goal and scale. The branding campaign depends on the client’s budget.”
As Charkviani noted the companies cannot yet perceive what branding is. “Only now is branding being introduced and are people realizing what it can offer, what it is needed for and why it differs from advertising and marketing. To perceive all this needs time and seminars as well.”
About one week ago Sarke Consulting arranged some seminars and invited professionals from Latvia. Seminars are not arranged very often, though they are very necessary and important.
“No one can sell branding unless they properly explain to the potential clients what branding is, why they need it, what problems it can solve and what results branding can give. Today branding is in the process of development in Georgia,” said Charkviani.
During the year 2007 Sarke Consulting has been providing services to the companies like: Arci, Axis, Iberia, Tsavkisi Valley, Vitel, Geocell, Rompetrol, PSP, Populi, Natakhtari and Pepsi.
Construction companies are the ones who cooperate with Sarke Consulting most actively. Construction companies such as Axis and Arci take full branding services. Tsavkisi Valley is their client for separate products.
“Construction companies stopped branding activities after the war because of financial problems. We can obviously see a reduction of advertisements on TV,” declared Charkviani.
As for now, they are working with PSP on a contract regarding Brandplatform. A month ago they concluded a contract with Geocell on Brandplatform, which will be completed in a month. If Geocell is satisfied completely with just Brandplatform and considers that it can independently proceed with and develop it, they might not extend the contract.
Natakhtari, who became the client of Sarke Consulting in August, is now taking full branding services.
“Natakhtari does not need re-branding. It is not necessary to do re-branding after the change of the owner. There are some companies which are never affected by re-branding. If the new owner however wants to appear with a new name, logo and message on the market, then that needs re-branding,” claimed Charkviani. “Pepsi is also our client. A share of Pepsi was acquired by United Arab Emirates, but they are not doing any re-branding.”
As Charkviani says, TV advertisement holds first place as this approach is the best developed.
As he defined, it is not logical to use only one media source. In some concrete cases, it is necessary to stick to one means of media. You just have to do simple maths to work out where and what amount of ad to place. A popular magazine is very important, where the placement of an advertisement will always be the right decision,” Charkviani said.
Since August two companies whom Sarke Consulting had provided with full package services, have asked for their contract’s termination till the New Year. This is due to financial problems they are having. “They are continuing production, but have stopped advertising activities on the market. We understand this completely and thus have temporarily stopped and not terminated our cooperation with them.”
Sarke Consulting provides services to corporate clients, which are mainly construction companies, alcoholic and non-alcoholic beverage companies, food production companies, banks and telecommunication networks.
“After the war our clients had losses and financial crises, which also reflected on us as we earn income from the service we provide them with (advertisement, branding, company planning, PR, advertisement shooting). We have not had any other kind of losses,” said the Director of Sarke Consulting.
According to him, in August branding activities are always reduced by about 50-60% but this year were reduced by 80%. They had the same situation in the first half of September. In the second half of September though activities increased again.
Sarke Consulting anticipated 30% increase of income in 2008. Due to several factors, such as unexpected presidential and parliamentary elections and the Russo-Georgian war only a 15% increase is expected.
Compared to the previous year, the activities of this year are 30% less. “The business is still not fully recovered. If a bank does not give a loan to a company, the latter will not be able to make new production. If banks do not renew market crediting, the situation will remain the same. Although today Georgian banks are receiving international loans which will help them to survive the Georgian market,” said Charkviani.
“If Georgia became my client, I would care about the development of a high quality democracy and introduction of freedom in society, and in business as well.”
Written By Sopho Kheladze