Brand politics
By Peter Guest | Published: 15 January, 2009
Launching a brand unavoidably entails a certain hazard, particularly in a politically-charged environment such as Kenya. Accidental political associations, however, can cut both ways, as France Telecom and East Africa Breweries Limited, can testify.
France Telecom bought into Kenya late in 2007 when it acquired a large stake in Telkom Kenya, the government communications company. The plan was to launch the Orange mobile and internet brand. However, there was an early complication, according to Peter Reinartz, deputy CEO of the company. “When the privatisation [of Telkom Kenya] was finalised and the [sale to France Telecom] was finalised on the 21st December, that’s when we came in, and the 27th December was elections. Shortly after, the country was set on fire,” he says.
The post-election violence in itself was damaging to enterprises across the nation, but to Orange it created an additional challenge. Presidential challenger and now prime minister, Raila Odinga, campaigned under the banner of the Orange Democratic Movement, itself subject to internal turmoil that led to the formation of a splinter party, the Orange Democratic Movement of Kenya.
“Knowing the strong polarisation that was present in the country with the two large [parties], the question was, was it wise to launch the brand, Orange, when it had been associated with these political struggles?” Mr Reinartz says.
“We did some market research and came to the conclusion that there was no negative association and it would not create problems, and we also checked it with both leaders – with President Kibaki and Prime Minister Odinga – and both of them also made it clear that they had no issue with it, so when we launched it in the middle of September [2008] it was very well received.”
On the other side of the same coin, EABL’s decision to name its new brand targeting the low income segment of the population “Senator” paid off handsomely, as the nation’s favourite adopted son – then senator, now president elect – Barack Obama saw the brand adopted as a celebration of the US politician’s success, and vendors in Nairobi became used to hearing patrons asking for “an Obama.”
Senator’s success has been to galvanise the Kenyan government into dropping taxes on locally produced, locally sourced beer, a social investment which promotes the development of agriculture and helps in the migration of consumers away from dangerous illicit brews and into cleaner, branded alcohol.
Even so, Mr Obama’s aspirational message and grass roots appeal seemed to rub off on the brand. “We are a branding company, so there’s a question of who came first. Was it Senator, or was it Obama?” says Gerald Mahindra, EABL’s group managing director. “We know that at in that low level market, pricing is everything, and that’s the price the traditional and the illicit [alcohol] was at. So what we don’t develop a brand and discount it to that price, we take the price and then find out what product we can make, backwards.”
While EABL might been keen to point out that the Senator brand has been in the public consciousness for as long as the president-elect, the company has not been slow to capitalise on his meteoric rise. “You’ve seen what we’re launching?” Mr Mahindra laughs. “President.” Even if Mr Obama had lost the election, the brand would have adapted, he adds. “We would have done something. We’re a very innovative company.”
