Business of Brands
KFC, Pizza Hut, Hyundai and KIA: When brands crossed the LOC
In an increasingly globalised world, your brand can get charred forever if your right hand doesn't know what your left hand just did…
Prasad Sangameshwaran ,
Updated On Feb 8, 2022 at 02:28 PM IST
A representative image of brands and LOC
A couple of months back, when Pakistani cricketer Babar Azam was named by ICC (International Cricket Council) as the captain of the most valuable team, the print edition of Brand Equity approached a media-savvy ad veteran with a request – could Babar Azam become the next big name from across the border to endorse brands in India?
There was a reason to approach this particular veteran. One of the businesses he managed had cast Imran Khan as its ambassador many years back. The association was very memorable. The ad veteran called up his client and was told to remain mum. What might seem as an uneasy silence over a seemingly academic discussion exploded on Twitter this week.
In this case, brands like Hyundai, KIA, KFC and Pizza Hut were guilty of crossing the limit by meddling with a burning political issue. As they faced the firing on social media, leading to boycott calls for these brands in India, it became apparent that their Pakistani counterparts had crossed the Line of Control. However, the Indian managers of these brands suffered collateral damage.
All the four brands were held guilty by Indian twitterati on account of posting messages on 'Kashmir Solidarity Day'. Twitter users started seeing a pattern emerging as both KIA and Hyundai are sister brands. Ditto for KFC and Pizza Hut. The Indian operations were quick to put out an apology. But that's not been enough to douse the fire.
On the business front, FADA, the umbrella organisation of auto dealerships, asked Hyundai India to clarify its stance. FADA also said that it is asking the Central Government and manufacturer industry body SIAM to intervene. The reason for the reaction is not difficult to understand. Dealerships are the ones that face the brunt of the public – they are the face of the brand for customers. In the case of KFC and Pizza Hut, the stocks of the Indian franchisee, Devyani International witnessed a selling spree.
The stock was down by nearly 4 percent when this piece was written. Yes, the stock markets were choppy, but other competitors in the F&B space had not lost as much ground.
These developments beg one question. In an increasingly globalised world, when most MNC headquarters approve most of the communication that goes out to the public, would this communication have been sent out on the sly. Or didn't the burning issue of Kashmir merit a discussion at the global headquarters of these MNCs?
One would be given to believe that it's a case of marketing myopia by the Pakistani counterparts. But hasn't that led to repercussions for the same brands in a much larger market of India? Will the fire die out as tempers cool down? Or is it going to leave burn scars behind for a longer time to come?
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What is Kashmir Solidarity Day?
'Kashmir Solidarity Day' is a national holiday in Pakistan since 2004, observed to show Pakistan's support and unity with the people of Indian-administered Jammu and Kashmir and Kashmiri separatists' efforts to secede from India, and to pay homage to the Kashmiris who have died in the conflict.
By Prasad Sangameshwaran ,
Published On Feb 8, 2022 at 02:22 PM IST
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