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Brand Value

The way the world is moving, it’s all about branding. Are we on our way to creating great restaurant brands that will be fought over in the same way that Western restaurants are?

india Updated: Dec 12, 2009 18:45 IST
Vir Sanghvi

If you’ve ever eaten carpaccio or drunk a Bellini, then you will have had some contact with the Cipriani family of Venice. The Ciprianis run Harry’s Bar in that town and it is either one of the world’s great restaurants/bars or it is an over-priced tourist trap depending on your perspective.

For better or for worse, Harry’s Bar is one of the world’s most famous bars and it has to its credit the invention of such dishes as the carpaccio (made from thin slices of raw beef) and such drinks as the Bellini (made with Prosecco, a fizzy Italian white wine and the pulp of white peaches).

The Ciprianis did not realise the value of a brand name when they agreed to let Lord Iveagh of the Guinness brewing family make them partners in a Venice hotel called The Cipriani. Within some years, the Ciprianis fell out with their partners, sold their shares and now have nothing to do with the Cipriani Hotel even though many tourists imagine that the hotel and Harry’s Bar have the same management.

In the 1980s, as the Ciprianis came to terms with the power of their brand, they tried to expand outside of Italy. By then, smart lawyers had begun to dispute who owned the name of the restaurant, and indeed the Cipriani brand itself. The Cipriani Hotel became part of Orient Express, the now struggling luxury chain controlled by American container millionaire James Sherwood in which our very own Taj group has a large shareholding. Sherwood opened a Harry’s Bar in London in partnership with Mark Birley (who also owned the nightclub Annabel’s).

The Cipriani family was kept out of this Harry’s Bar but chose to expand into America opening restaurants with such names as Harry Cipriani and simply Cipriani. Then, a few years ago, the Ciprianis partnered with David Tang, owner of London’s most absurdly overpriced Chinese restaurant (China Tang) to open a Cipriani London off Berkeley Square. The restaurant’s style of expensive Venetian service (and its so-so but entirely acceptable comfort Italian food) made it a hot favourite with Eurotrash and the many foreigners who are the biggest spenders on the London scene. Sherwood sued, saying that the name belonged to him, won a preliminary order but the courts have let the Ciprianis use their own name until an appeal is heard.

Such a lot of fuss over a brand name may strike some of us as excessive but it demonstrates the extent to which the international restaurant business has now begun to resemble the brand-conscious fashion business. Just as the Ciprianis have problems using their own name (and their problems have been compounded by criminal prosecutions in America) many fashion designers have also lost control of their names. Yves Saint Laurent sold his ready-to-wear business to Gucci and then made no secret of his contempt for the clothes that Tom Ford churned out under the Saint Laurent name. Jil Sander sold her name to Prada and has no control over the line even though it still goes out in her name. Hubert de Givenchy sold his label to Bernard Arnault and then laughed openly at the clothes that John Galliano and others made under the Givenchy name. I suspect the Ciprianis may feel the same way about Sherwood and his Cipriani products. But there is not much they can do.

Why do names matter so much in the restaurant business? You can understand why fast food chains have thousands of outlets. But should that be true of great restaurants as well? In the old days, most people would have argued that for a great restaurant to clone itself would be a travesty. There was only one Maxim’s (if you excluded the small airport branch). There was only one Tour d’Argent; only one Le Grand Vefour; and only one Jamin, and so on.

But those days are gone. My guess is that everything changed with Nobu. When Nobu Matsuhisa had only the one Matsuhisa restaurant in Los Angeles, he was unknown outside of that city. But once he took on such powerful partners as Robert de Niro and launched Nobu, each of the world’s great cities wanted at least one Nobu of its own. Now, there are two Nobus in New York, two in London, and dozens of Nobus all over the world. Nobody minds that these are essentially chain restaurants that serve the same menu everywhere in the world.

Inspired by Nobu’s success, the French chefs got in on the act. Alain Ducasse had already proved that it was possible to run two Michelin three-star restaurants simultaneously (in Monte Carlo and Paris), so it was logical for him to go further, opening such chains as Spoon and cloning his restaurants in other cities: one flop in New York followed by a second, more successful venture, a total dud in London etc.

Ducasse’s great rival, Joel Robuchon followed with his Atelier chain (new branches keep opening) and his own full-fledged restaurants in such cities as Las Vegas and Macau. Ducasse and Robuchon are considered the Gods of French gastronomy. If they could turn themselves into brands and open chains of restaurants, then why couldn’t everybody else?

So now, nearly every successful restaurant in America is cloned. (Steakhouses? Sure! There are loads of Morton’s and Smith and Wollenskys. Burger places? How many Hard Rock Cafes do you think there are?)

In India, we have actually gone full circle. In the old days, our most popular restaurants were clones: every town seemed to have at least one Kwality’s and every city had a Gaylord. (Then Gaylord went abroad in the 1960s.) Then, we moved away from cloned restaurants. The Taj used The Golden Dragon name in Madras (and eventually Hyderabad) but it tried to open fresh restaurants everywhere. The Oberois had Moghul Rooms (their versions of Kwality’s I guess) at their hotels which then became Kandahar. An attempt to standardise European restaurants as Rotisseries and Brasseries was wisely abandoned and the chain moved towards original brands.

It was ITC that went back to the branded restaurants. There may be only one iconic Bukhara but there are loads of Peshawaris that serve roughly the same menu. There’s a Dum Pukht at nearly every ITC hotel. All the coffee shops are Pavilions. Dakshins turn up in nearly every city. Pan Asians are nearly as ubiquitous. And the chain bravely perseveres with the foolish choose-your-own-raw-meat conceit of West View.

Interestingly, it is the stand-alones rather than the hotel restaurants that have demonstrated the power of the brand. Jayaram Banan’s Sagar and Swagath restaurants have phenomenal brand recognition. AD Singh has turned Olive into a household name in certain kinds of households. In Bombay, the Indigo name guarantees quality.

So, are we on our way to creating great restaurant brands that will be fought over in the way that Western restaurants are? Will we also witness the kind of battle that occurred when the two original founders of the Hard Rock Café broke up? Or see anything like the squabble over the Cipriani name?

I don’t think we are too far away from that day. It may take another five or ten years but the stand-alone restaurant scene in India is bound to explode. If, at that stage, a chain like ITC takes well-established brands like Dakshin or the promising Kababs and Kurries out of its hotels and into the malls and the streets, it could find that the brand alone is worth crores outside of the hotels.

The way the world is moving, it’s all about branding. And if it works for Ducasse, why shouldn’t it work for Jayaram or AD Singh or Indigo’s Rahul Akerkar or even, for ITC?