P R O D U C T A N D B R A N D M A N A G E M E N T

C A S E A N A LY S I S

HABITANT FOR HUMANITY

INTERNATIONAL

BRAND VALUATION

I N T E R N AT I O N A L M A N A G E M E N T I N S T I T U T E , N E W D E L H I

E X E C U T I V E P O S T G R A D U AT E D I P L O M A I N M A N A G E M E N T

S U B M I T T E D T O :

P R O F. B A L A S U B R A M A N I A N

S U B M I T T E D B Y:

V I N E E T D I X I T

M O D A K P R I Y

S U D E E P K U M A R K U N D U

A L O K G U P TA

S AT E N D R A T O K A S

1

HABITANT FOR HUMANITY INTERNATIONAL: BRAND

VALUATION

1. What are the strengths of HFHI?

  A habitat (which is Latin for "it inhabits") is an ecological or environmental area that is inhabited by a particular animal or plant species. It is the natural environment in which an organism lives, or the physical environment that surrounds (influences and is utilized by) a species population. Habitat for Humanity International is a nonprofit, ecumenical Christian housing ministry. HFHI seeks to eliminate poverty housing and homelessness from the world, and to make decent shelter a matter of conscience and action. The following are the strengths of HFHI .

1. Great Volunteer labour Base:

Through volunteer labour and donations of money and materials, Habitat builds and rehabilitates simple, decent houses with the help of homeowner (partner) families. The ultimate purpose of Habitat for Humanity is to make poverty housing and homelessness become socially, politically, and religiously unacceptable in today’s world. Habitat for Humanity will prove enjoyable and fulfilling. From working on Habitat construction sites and helping to produce Habitat’s newsletter, to manning special events, running our committees, and designing our homes, volunteers greatly impact every facet of our organization.

2. Innovative program to create buzz: Habitat developed innovative program which had been initiated in developing countries to increase the people’s ability to afford decent homes. examples of this. Save and built program was also adapted to single family that saved up their home income over the time and built it in the incremental stages.

3. Effective marketing communication mix:

Habitat advocates its project and gives the clear message to the general public. Big celebrity like U.S. President denoted the time building of a home . Habitat also organize the “world Leader Build” event in which 28 heads of the state and government from 26 countries 26 countries including president BUSH along with thousand volunteers worked together to built 1175 houses. This event drew the world wide attention to the organization. Former U.S. President Jimmy Carter became involved with Habitat for Humanity in 1984 and has since become its most high-profile proponent. He has been involved in fund-raising and publicity as well as actual homebuilding, taking part in the annual Jimmy Carter Work Project "blitz build"

4. Free of Debt and easily financially viable to poor and needy persons :

Habitat is a good deal program for poor persons. This was non profit generating organization. A common saying is that Habitat provides a hand up, not a hand-out. In addition to a down payment and monthly mortgage payments, homeowners invest

2

hundreds of hours of their own labour -- sweat equity -- into building their Habitat house and the houses of others. Habitat houses are sold to partner families at no profit, financed with affordable, no-interest loans ranging from 3-30 years in length. The homeowners' monthly mortgage payments are placed in a “Revolving Fund for Humanity”, being used to build still more Habitat houses in the future. Throughout the world, the cost of Habitat houses varies from as little as $800 in some developing countries to an average of $46,600 in the United States. Family selection committees choose homeowners based on their level of need, their willingness to become partners in the program, and their ability to repay the no-interest loan. Every affiliate follows a non-discriminatory policy of family selection. Neither race nor religion is a factor in choosing the families who receive Habitat houses. Whether to a local Habitat affiliate or to HFHI, donations are used as designated by the donor. Gifts received by HFHI that are designated to a specific affiliate or building project are forwarded to that affiliate or project. Undesignated gifts are used where most needed.

5: Word wide presence:

Habitants for Humanity International (HFHI) was founded in the 1976 by Millard and Linda Fullar, Founded as a Non- Profit, ecumenical Christian housing ministry that build houses in partnership with low income families. By 2002, HFHI had build 133,000 houses around the world, providing shelter to 650,000 people in more than 3,000 communities.

6: High Brand Value:

HFHI has high brand value. We can understand unaided awareness has doubled between 1996 and 2002. Focus group studies and surveys conducted among the people. The result of the findings was in favor of HFHI and customer perceived it is a very high brand. Result shows that HFHI enjoyed High profile and popular brand support.Inter brand analysis was based on a brand –strength and brand risk associated with that. HFHI brand strength score was 76 out of100. 7. Other strength

Other strength associated with brand like HFHI leads to spiritual motivation; Flexibility for volunteer, inertia, and tax benefit are other core strength associated to HFHI. Habitat’s Organization structure has three layers (local and national affiliates, area and regional affiliates and HFHI head quarters. Regional office plays coordination support and cross- learning role for international affiliates.

Question 2 What strategic challenges in HFHI facing?

3

Answer 2. Habitat for Humanity International is a non-profit organization that builds houses in partnership with low-income families. Established, in the year 1976 by Millard and Linda Fullar under the concept of “partnering housing”, the organization worked under the sole mission of

“Partnering with God and people everywhere, with all walks of life ,to develop communities with people in need, by building and renovating houses so that there are descent houses in descent communities in which every person can experience god love and can live and grow into all that god intended”.

By the year 2002, HFHI had recorded impressive revenue of $162 million, with some 74% of funding coming from individual contributors, up from 63% in 2001. Total estimated revenue world wide was around $689 million.

The present day challenges faced by HFHI were as follows:

1. Corporate Partnership: Over the past few years HFHI has been approached by many corporate and asked to form partnership. These corporate associate with HFHI because Americans love to work for non profit organizations. The volunteer aspects of HFHI work enabled employees of partner corporations to become directly involved in HFHI which was viewed as strong positive aspect of partnership. The volunteer activities offered to corporate can be used as part of their training program and creative leadership programs. Traditional partners have included companies like home building industries, banks, no of foundations etc. HFHI has always aimed to stay with those partners where the reason for brand linkage is clear. Now since the attention to corporate social responsibility is increasing among fortune 500 companies, partnering with non profit organization would be at high and these companies are always looking for deals where they could associate themselves with activities and Brand name of Habitant. HFHI is still unsure whether sharing the brand valuation information with corporate partners would benefit HFHI in monetary terms. There is also a risk of co branding where the PR of the corporate can be spoiled if in any case a homeowner is a convicted felon. Thorough the study conducted by Interbrand, HFHI knew that it had a good brand valuation but it was unclear which brand drivers are strong and need to be protected. Also knowing about the widespread recognition of HFHI the key question before HFHI was how to promote brand value as an assessment tool used by NGO community.

2. Maintaining Culture: HFHI was formed with a strong concept of being a Christian organization who believed that they are guided by the love of god has for his people and the major chunk of the revenue came from churches .The challenge now was to how do the company grow and go into countries where the population is non Christian without losing their own identity. The more diverse and popular the organization becomes the more it is difficult to grow globally.

3. Achieving mission through growth: The objective of the organization to eliminate poverty housing in the world was very ambitious but as much success the company had was just a drop in the ocean. A key challenge was how to grow with limited resources. Growing into countries like US, Europe the organization was aiming at developing countries but the major challenge

4

was the raising of funds and fulfilling the ambitions objectives of poverty housing. Another important issue was how to manage an organization that is non profitable and has a huge base into various countries worldwide. Recruiting enough and efficient people and managing them were tough.

4. Expanding the mission: One issue that was currently being evaluated was the possibility of providing temporary housing for persons displaced by disasters. The company get calls when there were any natural disasters and people were very supportive of these activities. However that’s not really the core of company’s business historically, company might be in risk by doing to much in this field.

5. Protecting the brand: One of the Habitat’s key challenges was effectively protecting the brand. Although Habitat don’t having direct control over their brand to the degree they would like. Within the United States, Habitat’s reputation varied by location depending on local market conditions and effectiveness of the local affiliate. To address the brand protection issue, company had initiated a new corporate identity program to achieve greater standardization of the Habitat brand throughout the organization.

Question 3 Do you believe $1.8 billion valuation?  Is it too high or too low?

5

Answer 3.

More than just a name or logo, a brand is a relationship in which value--revenue, loyalty, verbal support, etc.--is exchanged for tangible and intangible benefits, such as the satisfaction of helping a family build a decent house.

Currently, some of Habitat's strongest brand attributes include the mission to provide affordable housing, the tangible nature of Habitat's work and the potential for personal involvement. According to Interbrand, Habitat's brand impacts its house-building effectiveness in some important ways: It communicates key attributes of the organization and differentiates it from competitors; the brand attracts volunteers and reinforces the experience; and it increases marketing efficiency.

Non-profit brands have a dual objective: to enhance fundraising and to ensure the implementation of the organization's mission. In addition, non-profit organizations tend to be more decentralized, with little formal hierarchy. This can mean that implementing activities that protect the brand or attempting to update or modify the brand often meets with resistance internally. The brand is the glue holding the components of the global organization together. It is important for any organization, for-profit or non-profit, to know the value of their brand so that they can allocate adequate resources to nurturing, building, and protecting it. For many non-profit organizations and consumer goods companies, their brand is, along with their people, the most important asset they have. Tracking the value of that asset and understanding what activities increase or decrease asset value is key to managing it effectively. As traditional sources of funding erode for nonprofits, an increasing number are turning to the private sector for funding. Businesses are also increasingly searching for opportunities to form partnerships and co-branding programs with high-profile nonprofits. If nonprofits are unaware of the value of their brand, they run the risk of not extracting the full financial value from these partnerships and co-branding opportunities that they deserve. HFHI a non-profit organization that works on annual revenue of $689 million worldwide, if seen from the perspective of brand value it was discovered that it had the same brand value as Starbucks the worlds biggest coffee chain i.e. $1.8 Billion was very high. This high brand value could be aligned with the mission of the organization to meet the changing needs and challenges. By aligning the current mission with their target donors, HFHI can create a brand identity that both more accurately reflects the organization's activities and mission, and resonates with their target donors and or volunteers.

6

Question 4 What are the benefits and risks of valuing a NGO brand like HFHI?

Answer 4 Habitat for Humanity International ( HFHI ) is a nonprofit, ecumenical Christian housing ministry that sought to eliminate poverty housing and homelessness from the world. HFHI positioned itself as an organization “ helping people to help themselves ”. The HFHI built and rehabilitate simple houses with homeowner ( partner ) families. The houses were built with no profit added and no interest charged, financed by a revolving fund for Humanity. The fund’s money came from new homeowner’s mortgage payments, donations, no-interest loans provided by supporters and fund raising activities. In May 2002, Interbrand conducted study of HFHI’s brand value. Interbrand’s brand analysis was based on a brand-strength score and brand-risk model that scored a brand relative to a notional ideal brand against seven core attributes associated with strong brands – Market, Stability, Leadership, Geography, Trend , Support and Protection. HFHI’s resulting brand strength score (BSS) was calculated at 76 out of 100. Based on the study of HFHI, there are following benefits and risks associated with the Brand Valuation of a NGO –

Benefits -

(1) First, an organization’s brand is a valuable asset that can be leveraged in corporate partnerships to open the door for new business opportunities such as Cobranding, Licensing and other partnering opportunities. In addition, by comparing brand values , an organization is able to select appropriate partners and extract the correct value from each partnership.

(2) Secondly, knowing the value of the brand and communicating it effectively can result in budgeting the funds and human resources necessary to protect and grow the brand asset.

Risks –

(1) If the NGOs are unaware of the value of their brand, they run the risk of not extracting the full financial value from partnerships and co-branding opportunities that they deserve.

(2) Sharing the Brand Valuation information with the corporate partners may lead to dilution of the brand.

7