The old adage “We think with our head but decide with our heart” could not be truer for branding for Indian services companies. While initial growth came rapidly in the post 1991 liberalization through labor arbitrage, and global delivery models, now the U.S. majors are setting up their own shops in India. Simultaneously more Indian companies are setting up their own “consumer facing” arms in the U.S. and EU countries. “Build, Buy or Ally” are the three options available for vertical integration and the Indian companies are leveraging all three. Though this addresses the setting up of operations to create those unique differentiators, it does not clearly articulate it—and hence may not be perceived of value by the buyer in making the buying decision. This process of articulating that key message becomes the “Brand Positioning” exercise. This Branding has not been a priority for the Indian IT services companies so far; but now with an increasingly competitive environment—in the U.S. for contracts and in India for brainpower—the race is now on between rival “global IT delivery systems” and will be increasingly fought on issues around “Brand perceptions & positioning”. Philip Kotler the marketing guru defines Differentiation as “… the act of designing a set of meaningful differences to distinguish the company’s offer from it’s competitors”. He further defines Positioning as “…the act of designing the company’s offer and image so that it occupies a distinct and valued place in the target customers’ minds”.

So the “beauty is in the eye of the beholder”. A majority of the Indian IT services companies have a self-image of being a “commodity” and hence have not ventured beyond competing on price alone. There is no such thing as “commodity!” Instead of thinking of it as selling a “commodity” product, a company must see this task as converting an “undifferentiated product” into a more “differentiated offer.” Per Levitt, “No matter how commonplace a product may appear it does not have to be viewed as a commodity. Every product, every service can be differentiated.” This partially reflects the fact that buyers have different needs—and hence attracted to different offers—and that’s not always a “low price”!

In developing a positioning strategy, remember that not just all differences can become differentiators. Each difference has the potential to add costs as well as customer benefits. To differentiate your company’s offerings “look at yourself through the eyes of the customer” and evaluate the difference along the following criteria:

Important: The difference you are promoting is valued highly by a sufficiently large number of buyers.

Distinctive: The difference is unique to you. (You also create that uniqueness by being the first to say it and grab that position in the marketplace!)

Superior: The difference is superior to other ways of achieving the same results.

Communicable: The difference is clearly visible, perceivable and communicable to buyer.

Pre-emptive: The difference cannot be easily copied by the competitors.

Affordable: The buyer values the difference, but is also willing to pay a premium for it—upto a limit!

Profitable: The company would find it profitable to introduce the difference.

As companies embark on their branding initiatives and develop a number of claims for their brand, they risk disbelief and a loss of a clear positioning if they make one or more of the following four major positioning errors:

Underpositioning: Some companies discover buyers have only a vague idea of the brand. Buyers don’t really sense anything special about it.

Overpositioning: Buyers may develop too narrow an image of the brand. For example, a certain company becomes famous for only one particular vertical application—and the buyers may not be aware of all the other diverse areas it has built excellence and expertise in.

Confused positioning: Buyers may have a confused image of the brand resulting from making too many claims or changing the brand’s positioning too frequently.

Doubtful positioning: Buyers may find it hard to believe the brand claims, looking at the literature claims on the product/service features, price or company name—especially true if there is no corporate campaign to speak of.

The key advantage of solving these positioning problems is that it enables the company to solve their “marketing-mix” issues. This marketing-mix—product (or service), place, promotion and price—are essentially the tactical details of the positioning strategy. Thus a firm setting up a “high-quality position” charges a higher price, produces a high-quality product/deliverable and advertises in high quality magazines and publications. That is the primary way to project a consistent and believable “high-quality image.”

Very few IT service companies seem to advertise, and hence internally may not yet have gone through the positioning strategies. There are primarily seven possible positioning strategies and—depending on the companies’ current situation and future intent—one or more may be relevant at different times in it’s life-cycle:

Attribute positioning: TCS could position itself as the largest company with over 27000 trained engineers in multiple countries. Here the size—and the global presence could be great leverages.

Benefit positioning: A smaller BPO could tout the excellence achieved in a particular niche market—say “expertise in airline bookings” and tell a nice compelling story about it’s expertise in reducing operational cost while increasing consumer satisfaction.

Use or Application Positioning: Infosys’ “Transforming business through integrated technology solutions” is certainly on the right track—but has a distinct “engineer-speak” quality about it. Engineers alone may not take all decisions in corporations.

User Positioning: Accenture positions itself as “High performance. Delivered” and goes on to describe a “user example” from the travel industry – emphasis on consulting with an “outsider looking in” perspective.

Competitor positioning: Wipro’s “Applying Thought” positioning makes it look like a concerned empathetic partner—not just an outsourcing vendor. It may imply others don’t think as deeply about the client.

Product category Positioning: Satyam’s “What business demands” seems more a “generic business” positioning rather than a product category positioning. Hopefully the case studies, white papers and so on make it meaningful to the buyers.

Quality / Price Positioning: CSC has an “Experience. Results” positioning. These may sound nebulous until articulated into something concrete, till one reads more details of it’s “Practical bottom-line results” achieved.

Unless services companies become more savvy, develop branding & communications expertise internally—and do it rapidly—the long term opportunity window is closing fast, especially for Indian services companies. Lastly, an additional unique challenge facing services companies (unlike a manufacturing company) is the fact that almost all their employees meet their clients on an daily basis! Many of them are actually working at the client sites for several months at a time—even years. This can either be an opportunity or a liability depending on whether the employees are trained to become their “brand proponents” or “brand detractors” for the company. So it is equally important to have an internal company culture and internal communication mechanisms to continuously engage, stay in touch, involve and build that “brand equity” with each and every employee on a global basis—from day one!