Beyond banter: When brand wars turn into lawsuits

According to marketers, comparative marketing is used by both small and big brands: for smaller brands, it’s a way to attract attention by challenging established leaders; for larger brands, it’s an opportunity to display strong data to substantiate claims and communicate their superior offerings.

In either case, the campaigns are well-thought-out and tactical ways to build a brand narrative, said Lloyd Mathias, angel investor and business strategist.

“Brands typically do it when they operate in a pretty undifferentiated segment, essentially categories where it’s a good way to establish a clear point of differentiation and showcase their superior offering versus competitors, say colas or hair oils,” he said in an interview with Mint. Mathias was formerly marketing head of HP Inc.’s computers business for the Asia-Pacific region as well as executive vice president, marketing, and category director for PepsiCo India and South Asia.

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Mathias explained that comparative advertising can be effective for both small and large brands. When a smaller brand challenges a giant—in a classic David versus Goliath scenario—the campaign itself can effectively draw consumer attention to the entire product category. “Large brands, on the other hand, could also be using data to display superiority over the competition. Market leaders typically use such advertisements to stymie competition—very clearly,” he said.

Comparative advertising isn’t a new phenomenon; it’s actually quite prevalent in Western markets. Over the years, major competing brands have frequently engaged in advertising battles, either by directly targeting each other in their campaigns or by responding to competitors’ ads with humorous digs and comebacks. While often seen as playful banter between brands, these clashes sometimes escalate to legal disputes. Regardless of the outcome, they provide valuable case studies for marketers.

Well-known examples include the long-standing “Cola Wars” between Coca-Cola and Pepsi, the advertising rivalry between McDonald’s and Burger King (where Burger King often takes direct jabs at McDonald’s), and the humourous exchanges between automotive giants BMW and Audi.

As India’s consumer goods market has evolved, it’s becoming increasingly common to see brands directly address their rivals in advertising. Indian examples include the competition between Marico and Dabur, Amul versus Britannia, Reliance Jio against Airtel, and Lifebuoy versus Dettol.

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In January 2021, Hindustan Unilever Ltd (HUL) sued Sebamed in the Bombay High Court over an aggressive ad campaign comparing HUL’s Lux, Dove, and Pears soaps unfavourably to Rin and alleging they lacked optimal skin pH. The court restrained Sebamed from further infringing on HUL’s brands.

“Competitive communication campaigns can either be tactical or strategic, the latter being when the messaging is core to the brand’s essence. Pepsi is a leading example of a brand that does strategic communication campaigns that are competitive in nature and emerge from the brand’s DNA. Most competitive advertising campaigns tend to be tactical and, therefore, generally have limited effectiveness,” said Samit Sinha, founder of Alchemist Brand Consulting. In the past, Sinha has worked with brands such as Capital Foods, Cremica Food Industries, Godfrey Phillips, Samsung, RPG and Lava.

Direct comparisons in certain categories that are highly functional in nature can and sway consumer preferences occasionally, but do not have a lasting impact on building brand loyalty, even when the claim is genuine and backed by hard evidence, argues Sinha. That’s because ultimately a brand’s true strength depends on its ability to forge an emotional bond with its consumers, not merely on the basis of superior features and functional benefits, he explains.

Recently, HUL’s Lakmé sunscreen ad, claiming an “online bestseller” with SPF 50 only offered SPF 20 (based on in vivo testing), led to a legal dispute with Honasa Consumer. Honasa argued the visuals disparaged its Derma Co. brand. The court directed HUL to modify its ad, removing “online bestseller” and altering competitor packaging visuals, while also asking Honasa to remove related social media posts. The matter has been resolved.

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Vani Gupta, founder, CherryPeachPlum Growth Partners, said brands must indulge in challenger marketing backed by substantial claims.

“As long as a brand’s claims are sustainable with clinical trials and can be backed in court, there is no reason why a brand should shy away from calling out another brand—an open brawl may not only help steal share from the competitor, but also grow the category,” she said.

Gupta was earlier the marketing director of PepsiCo India.

“Coke and Pepsi in yesteryears did a marvelously entertaining job of dragging out each other, but done in a playful, irreverent manner, true to the brand’s identity. The audience knew the brand being called out, even if it wasn’t explicitly named. Captain Cook took on Tata Salt with one of the most endearing comparative ads—still recalled today long after the brand is dead,” she added.

Meanwhile, legal experts said that comparative advertising is allowed under Indian law, but there is a fine distinction which mandates that such comparison be honest and not misleading. “While brands can showcase their product’s comparative strengths, they cannot belittle or mock a competitor. Disparaging remarks—whether direct or implied—can trigger legal action for defamation, unfair trade practices, or other legal actions under intellectual property laws. Additionally, ASCI (Advertising Standards Council of India) guidelines discourage advertising which unfairly targets or misleads about other products. Using exaggeration may be acceptable as puffery, but factual comparisons require substantiation,” said Mitakshara Goyal, co-founder of Delhi-based law firm Svarniti Law Offices.

The key, said Goyal, is to inform, not to malign. “If an ad causes reputational harm or consumer confusion, it becomes legally vulnerable, triggering regulatory scrutiny and takedown notices/court orders,” she said.