Monday, November 10, 2014

RADICAL THOUGHTS: The Return on Advertorials

Varsha Poddar | IIM Shillong

The journalism ethics of Bennett Coleman & Co, the publishing house that owns The Times of India came under a dubious light when the firm admitted to publishing ‘advertorials’ or articles that looked like normal press coverage but were actually paid for by a party with vested interests. Thereafter, advertorials became a sort of pesky norm that newspaper readers made reluctant peace with. Some newspapers then came clean about it and began to publish separate advertorial sections so that readers could discern between genuine reportage and swayed reviews. However, now, once again advertorials are surreptitiously creeping into a space that had previously been free of any vested-interest broadcasts – social media. Social media holds the power to make content go viral. Sites like buzzfeed, thoughtcatalog, boredpanda, to name a few, and their indian counterparts such as scoopwhoop, allindiabakchod and storypick carry posts that are essentially everyday occurrences boiled down to simple, laundrylist- like content. These are shared over and over again on social networking sites because people connect to them instantly. However, a lot of posts from these sites are actually nothing but advertisements pretending to be normal content.

Take for instance, BuzzFeed’s post “10 Summer Emojis That Should Definitely Exist” which was actually sponsored by Starbucks or “What should you do before summer ends” sponsored by Pepsi. Posts such as there pass as organic as the title and URL give no hint whatsoever that the content is actually an ad. As a result, they gain much more viewership than advertisements that do not masquerade as creative content and often go viral, giventhe standard virality that the site holds.
Scoopwhoop also ran posts such as the video “This Hilarious Prank Video Tells You The Difference Between A Good Friend & A Best Friend” which was actually sponsored by Airtel. While marketers are making good use of contentsharing sites such as these as they prove to be more effective and less expensive, social media users are beginning to question the authenticity of the content they consume, much like the newspaper readers did with the advertorials. And as a result, change is on its way – BuzzFeed now displays prominent yellow buttons saying “Promoted by (brand partner)” for its sponsored posts and “Publishing partner” for featured brand pages. While the indian counterparts are yet to take similar steps, it could only be a matter of time before the content consumers once again upend the publishers into telling them clearly if their early morning paper or, in this case, the never-ending lists and trivia they consume are actually meant to manipulate them into more consumerism or not.

JAB THEY FAILED: Tommy Hilfiger- When Tommy turned Hip-Hop

B Ushashree | IIM Shillong

Revolution or evolution? – it is a classic question brands and businesses are faced with today. Tommy Hilfiger is a well-known fashion brand that decided to take the revolution route which backfired. The brand was started in 1984, in a partnership with Mohan Murjani, an Indian entrepreneur who started Gloria Vanderbilt label, to design a preppy line along the same lines as Ralph Lauren. By late 1980’s Hilfiger found a new partner, Hong Kong knit-maker Silas Chou, and the brand grew steadily over the years. The company went public in 1992 and became even more famous. It was associated with “classic and preppy” and more importantly it was affordable. According to Hilfiger, this made it wearable and hence saleable. By the 1990’s it seemed like Tommy Hilfiger was everywhere. It was clinging to Britney Spears, hanging off Snoop Dogg and draped around Kate Moss. The Tommy logo became synonymous with cool and Hilfiger used it extensively. The Logo was present on every apparel and prominently visible, which is exactly what the consumers wanted. Hilfiger was happy to respond to its popularity among hip-hop musicians and athletes and gradually introduced hip-hop elements in its line. By the close of the decade, however, the line began to fall out of vogue and the sales plateaued. 
In order to gain relevance again, Hilfiger decided to completely revamp its brand. According to Hilfiger, the ideawas to be the first in trends. And in 2000, the brand decided to push the envelope further than ever believing that the customers would respond. However, in doing so it moved away from its roots and the brand elements which had initially made it click. The first misconception the brand had was that people didn’t want the Tommy logo anymore. They took it off a lot of stuff and in many places they made it tiny. In other words, they became insecure about the very thing which had propelled them to success earlier. Hilfiger also launched a ‘Red Label’ a logoless sub-brand aimed at the very top of the market. This range included garments in the range of US $7,000 such as patchwork, python-skin trousers. Not only were these items very different from Tommy’s preppy style, they were out of the reach of the average Tommy Hilfiger customer also. Another mistake that Tommy Hilfiger made was to open stores in locations such as London’s Bond Street and Beverly Hills’ Rodeo Drive. In doing so, Tommy Hilfiger hoped to follow successful Euro-brands such Gucci and Prada which played on exclusivity and style. However, this was never Tommy’s forte. The brand completely shed its personality and tried to revolutionize itself. Needless to say, all these moves failed horribly. Sales plummeted like never before, customers and investors lost faith in the brand. Many of its new stores had to be shut down. 
Tommy learnt from its mistakes and decided to go back to its roots – “classic with a twist”. The brand was about color, preppy and class. It re-introduced its logo and went back to its colorful and preppy designs. It shut down several stores and entered into a contract with Macy’s, a leading retail giant in US. Sales of Hilfiger clothing have rebounded, according to the designer, and the company is positioning itself to respond to changes in the industry. Every brand has its image and attitude it should never forget or let go of this. Tommy Hilfiger chose to stick to its heritage and not chase trends as it had proved to be catastrophic. Chasing trends is an easy option that comes to businesses naturally but it is dangerous to do so. It’s more important for brands to be consistent. Time and again, it has been proved that a brand should never let go off its formula – its reason for being. Another mistake Tommy did was to compete with irrelevant rivals – brands like Gucci and Luis Vuitton had a different playing field and very different principles. In doing so the brand entered unnecessary and illogical brand extensions which proved to be its bane.

Ishtihaar

Ramanathan K | IIM Shillong

The Way out
 A question that has been running through my mind for quite some time is, what would be the role of traditional Brick and Mortar (B&M) stores in this E-commerce world? E-retailing, even though it accounts for only 0.4% of the overall market in India, it is poised to grow from a ₹ 12,000 crore business in 2014 to a huge business of ₹ 1, 67,000 crore business in 2020. Today, we are increasingly been attracted, and habituated for various reasons, to online shopping as more and more products/ services are being offered online. Even Cars and houses are now being sold online! With newer phenomenon like showrooming becoming more popular, what could traditional stores do to stay alive and differentiate against these E-commerce players? This is a very important and a pertinent question that every one of us will have to face and answer at one point of time. 
The question should be analysed from two different perspectives: One from the eye of big brands with huge financial muscle like the Future Group’s Big Bazaar or Infiniti Retail’s Croma stores and the other from individual local mom and pop stores who do not have much financial power. 

Omni Channel Retailing 
The companies which fall in the former category have many physical stores all across India and the only way out for such brands to stay afloat is striving towards Omnichannel marketing. As consumers move seamlessly between digital and physical channels, even during the same shopping trip, the lines between online and in-store shopping is getting blurred, and reaching out to consumers through all possible shopping points is becoming imperative. Every marketer should remember that consumers are no longer entering a particular channel but always are there in the channel interacting with our brands. Omni Channel retailers should get out of thinking in silo about the particular channel and should start focusing on leveraging all the channels to provide a seamless brand experience. Future Group is planning to invest ₹ 100 crore over next 18 months to provide consumers a single view of its many brands across physical and digital channels. This completely now justifies the move by various companies to open up their own e-retail sites and offering Buy Online Pick In-Store (BOPS) option. Apple is known for its BOPS option where the customer can place the order online and collect it from the nearest store within hours after ordering. Customers should be able to shop online and exchange products at any physical stores. A lot of the stores are spending huge amounts infusing a lot technology to provide an easy, convenient and seamless shopping experience. Omni Channel Synergy is THE way out for these retailers to make their B&M stores relevant today. The toughest part is answering the question from the local mom and pop stores’ perspective. With very little financial muscle, for them to stay alive is to tweak their strategy to make it their store relevant to the locality they are serving. The biggest advantage for such stores is the ability of offering customized, personalised service and they should leverage this advantage to enhance the stickiness factor towards their store. 
With all said, the major takeaway for every marketer should be that physical stores are relevant still in today’s context and henceforth will play an instrumental role in the growth of Omni-channel retailing. 
Reach me at 8415921950 or mail me in the id ramanathan13@iimshillong.in or ping me in FB ID https://www. facebook.com/ramanathan.kathiresan.5 for sharing your
valuable feedback

The lexicon of Brands from Markathon

The lexicon of Brands from Markathon

No, A isn’t for Apple and
D is not for Durex

This lexicon of brands lists some memorable Indian brands that we grew up with. While some have been displaced by multinational brands, others still rule the roost. A lexicon of brands that looks at the curiosity of sorts that the Indian market has proven to be for brands which came into existence before or soon after the opening up of the economy and how they coped with the flux that resulted from it. 

Archies – Before the Hallmarks of the world and way before Chumbak, Happily Unmarried and other such kitschy outfits entered the ‘social expression’ space, Archies helped India express itself with Holi, Diwali and Rakhi greetings. Started in 1979 by Anil Moolchandani, the company is now present in 120 cities in 6 different countries. It went public in 1995 and was listed in the NSE and BSE in 1998. “The most special way to say you care” is still around in the times of ‘HBD’ posts and virtual cakes on facebook. 

Burnol – It is one of the oldest antiseptic cream brands in India and has changed hands many a times, starting off with Boots, being bought over by Reckitt Piramal in 2001 and finally coming to rest in the brand portfolio of Dr Morepen Labs which marketed it as the “Burn Specialist” creating a high recall among Indian consumers and reaching the first-aid kits of almost every household in India. 

Camlin – now known as Kokuyo Camlin with Kokuyo of Japan acquiring 51% stake in the company, Camlin was started in Mumbai in 1931 and still the market leader in producing art materials such as watercolours, poster colours, pastels, acrylics, and stationery. What started as Dandekar & Co that began to produce Horse Brand ink powders and tablets evolved into the maker of Camel Ink for fountain pens went down as the stationery brand that almost every Indian child went to first day of school with. Every kid before the 1990s for sure! 

Duckback – started in 1920 in Kolkata by Bengal Waterproof Works Ltd now (Bengal Waterproof
Ltd), Duckback ruled the roost of rainwear in India for many decades before it was put out of its leading position by increasing rubber prices and a failure to innovate to more modern products. The company made a comeback in 2012 and now manufactures soft and hard luggage options amongst other things. Duckback was one of the foremost ‘swadeshi’ brands to appear on the horizon. 

Essel World – India’s largest and foremost amusement parks has withstood the brunt of a booming travel and tourism industry. Operated by Pan India Paryatan Private Ltd (PIPPL), a subsidiary of the Essel Group, the very mention of the amusement park still summons to mind the jingle “Essel world mein rahunga main, ghar nahi jaunga main”. Essel World and its younger cousin, Water Kingdom, have remained iconic Indian brands. 



Fryums – So those colourful ‘snack pellets’ that are often the only things that add colour and crunch to mess food across the country were actually launched by TTK Healthcare. If too much of a good thing was ever bad for a brand, then the brand was definitely Fryums. Fryums became popular and thereafter turned into a generic brand in its own right. So much so that other manufacturers began to manufacture ‘fryums’ too and slowly the brand was lost but the  product’ Fryums endured. Not particularly to the advantage of TTK Healthcare, of course. 

Gili – India’s first jewellery brand was launched in 1994 and is credited for introducing many practices in the thriving jewellery industry in India. It was the first jewellery brand to sell in departmental stores and to have uniform quality and designs at all its stores across the country.


Hero Pens – Not an Indian brand, but it has been a part of every Indian kid’s childhood, nonetheless.
Hero Pens, with their hooded nibs were the first fountain pens that most of us began the journey of
endless hours of scribbling with. Founded in 1931 as the Huafu Pen Factory, the Shanghai Hero Pen Company owns the brand of Hero Pens which can still be found with retailers online and offline as well. 

Indrajal Comics – Brought out by Benett Coleman and Co – the publishers of The Times of India, Indrajal Comics first brought to India Lee Falk’s Phantom stories and progressed to his Mandrake stories, Alex Raymond’s Flash Gordon, Allen Saunders’ Mike Normad, Kerry Drake and many more. Though they stopped publishing in 1989, in the 27th year of Indrajal’s existence, old prints can still be bought off eBay and in dusty second-hand book stores in the forgotten by-lanes of old cities that reek of nostalgia. 

Jumbo Circus – Started by Badnasheel, a businessman, in 1976, in the city of Calcutta, Jumbo Circus is credited to have brought the entire circus scene to India. With acts ranging from acrobatics, to ‘boneless acts’ to animal shows, which are now banned, the circus continues to be staged even today in cities such as Chennai. In the times when television was only just crawling into India, Jumbo Circus made leaps and bounds in the entertainment business. 

Kismi – the ‘elaichi’ flavoured sweet from Parle Products was launched to serve as a mouth freshener. Available in Kismi, Kismi Gold and Kismi Toffee Bar, the sweet has been a favourite over many years and still occupies shelf-space in mom and pop stores across the country. Often alongside other landmark sweets such as Mango Bite, also from Parle Products Ltd.

Liberty Shoes – Based in Karnal, Haryana, Liberty Shoes was perhaps the first shoe brand that most
of us dawned when we stepped into school on our first day, even before Bata came and buckled our tiny feet with its offerings. Currently the brand is present in over 6000 multi-brand outlets across the country and has a presence in over 25 countries through more than 50 stores. Mysore Sandal Soap – In production since 1916, Mysore Sandal Soap is manufactured by Karnataka Soap and Detergents Limited, a subsidiary of the Government of India, the soap and its iconic packaging have almost become a part of the heritage of South India. Loyalists of the soap still hunt it down from the elusive stockist or order online. Nataraj Stationery – Established in 1958, Hindustan Pencils Ltd is the largest pencil manufacturer in India, with the brands Nataraj and Apsara being exported to over 50 countries. Their state-of-the-art manufacturing units with latest machinery set up daily produce 7 million pencils, 1.5 million sharpeners, 2.4 million erasers, 0.2 million scales, 0.8 million pens.

Original Choice Whisky – John Distilleries Pvt Ltd which owns the brand Original Choice Whisky also manufactures rum, brandy and other distilled alcoholic beverages which it markets under more
than 10 brands. Set up in 1992 in Bangalore, it has 16 manufacturing units in 12 states and revenue of
over Rs 9 billion. Another home-grown brand that has largely remained obscure.

Parry’s – EID Parry, which has been in business for more than 225 years, has many first to its credit. It was the first company to manufacture fertilisers in India and is currently engaged in the production of sugar and sugar-based goods. It is an instantly recognisable name in India, especially its southern parts and is known for its collaborative efforts with sugarcane farmers.

QuickChek – Another one of Dr Morepen’s products, QuickChek was the first pregnancy test kit
manufactured in India. Its promise was that it delivered results in a matter of 5 minutes and offered
easy-to-read results. One of the brands which did not really catch on, but was nonetheless worth a mention due to its pioneering efforts.

Rasna – Owned by Pioma Industries in Ahmedabad, Rasna was launched in early 1970s and is still popular today, to the tune of having more than 82% share of the soft-drinks concentrate market in India. Apart from gaining ground against the mainly carbonated soft-drinks market that emerged in the 1990s, Rasna was also the first brand to centre its communication around the child being the influencer in the purchase of soft drinks and implanted its tagline “I love you, Rasna” in the minds of more than one generation of Indians.

Spykar – Started by Prasad Pabrekar in 1992 to introduce some home-grown competition to the Levi’s, Pepe Jeans and Lee Coopers of the world that were making themselves comfortable in the country, Spykar is now a Rs 500 crore brand and recently Kishore Biyani’s Future Lifestyles bought a 75% stake in the fashion label. Created with a premium feel, using mostly foreign-looking models and locales for its communications, Spykar attempts to create a presence in the minds of the Indian youth by alienating itself from the country of its origin.

Topaz Blades – manufactured by Malhotra Shaving Products, Topaz Blades and Laser Razors are now present in countries across the world, with a strong presence even in the quality-conscious countries such as the USA, countires in Europe and the Middle East.

Uncle Chipps – “Bole mere lips, I love Uncle Chipps” – the jingle not only rang in the market leader in snacks in the 1980s, but also launched film director Shantanu Moitra’s career. In 2000, the brand Uncle Chipps was bought by Frito-Lay (PepsiCo’s snack division) from Amrit Agro Industries Limited for $6.6 million.

Vadilal – from a hand-cranked soda fountain to being the second largest ice-cream player in India
with a brand worth over $4.5 billion, Vadilal has come a long way. Started in 1907 in Ahmedabad by
Vadilal Gandhi, Vadilal now has significant exports and a diverse range of offerings – from frozen goods to ice creams. It is the quintessential Indian brand whose true worth and reach are often undermined because it blends so well in the background, where it has been for really long!



Williamson Magor – Now McLeod Russel India, Ltd, Williamson Magor was established in 1869 and it accounts for a production of 100 million kilograms annually, from estates in Assam, West Bengal, Vietnam and Uganda. It is one of the foremost exporters of tea in the world.

Xmex – Started over 15 years ago, Xmex is India’s first plus size fashion store now has considerable
retail presence – of over 1000 multi-brand outlets in cities like Mumbai, Delhi, Chennai, Pune and Kolkata. It also has a thriving wholesale business and its products can be ordered online from a number of etailers. Perhaps a harbinger of the ramifications of a shifting lifestyle, the brand makes the list for being ahead of its times in capturing a market that seems to be ominously hurtling towards reality. Yezdi – Ideal Jawa Ltd, popularly known as Jawa started operations in 1961, with the help of former Czechoslovakian Jawa Limited and by 1968 had established wholly indigenous manufacturing of motorcycles under the brand name Yezdi. The idea was to offer consumers a product that was home-grown and offered value for money. The tagline “Forever bike, forever Value” was coined to reinforce the same and the ideals of the brand remain unchanged even today, in the face of stiff international competition.

Z talc – Led by the vision of four brothers Sunder, Guna, Mohan and Shivaram, Argus Cosmetics was launched in 1992 to serve the needs for male grooming products, a category that the brothers believed was neglected by leading players in the industry. The first product to be offered was the Z-talc and the product portfolio soon expanded to include face.

BY VARSHA
IIM SHILLONG     

iPhone 6 # Bendgate

Winner: Nirna Nevrekar | Goa Institute of Management



Honorary Mention: Sai Sashanka Paladugu | IIM Shillong


An imperative tool for Customer Retention

Retail loyalty programs are common place today. From Mom & Pop stores to large super markets, almost every other retailer has some form of loyalty program. Some offer instant gratification with upfront discount, some offer threshold vouchers, some are currency based etc. However, the success of retail loyalty programs, regardless of their structure, remains indistinct to business. Despite significant investments, most retailers are still unsure about the real value creation by their loyalty programs. They tend to think loyalty programs are just a line item between their Gross and Net profit and an attribution of economic impact of any form (to the loyalty program), is highly disputable. There are potentially two scenarios that emerge in the context of retail loyalty. In the first, the program is integral to the brand and often program loyalty is inseparable from brand loyalty. But in the second scenario, where the loyalty program services many brands (for eg: a retail conglomerate which has many retail brands), it is especially challenging for the program to be considered as an effective mechanism for value creation.
Why? Research suggests that the answer to this lies in both retail loyalty strategy and its execution. In many instances, great strategic blue-prints not being adequately supported with the right execution while in other cases, strategy itself was flawed. Based on the results it is visible that lack of Fitness for program purpose and inability to achieve goal congruence within internal actors as strategic issues and an ineffective management control and suboptimal accounting framework as key execution failures. This paper discusses each of these issues in detail. Strategic Issues 1. Most retail loyalty programs claim to exist to increase customer retention. However, most firms don’t have a clear basis to identify if their customer loyalty is transactional, functional or attitudinal. Brands often claim that they do not require any loyalty program for inducing the first two forms of loyalty and quite rightly so. The acid test of a program is to be able to become a force multiplier on the top of the retail brand and induce the third form of loyalty. Today, programs just can’t compete based on direct value payout or functional features and functionalities alone, as these are highly replicable. It has to create experiential differentiators which would work as a perceptual exit barrier for customers. It should make customers immune to either some tactical play of competition or acceptable price increase by the firm. To this effect, the first step is actually to agree on a whole set of economic and non economic activities which can be attributed to the loyalty program without much dispute. The second step is to create a robust measurement framework around these agreed activities. 2. The objectives are determined, it is to establish goal congruence between various internal actors through a robust performance management model. This is the key to foster collaborations within the organization. Cross functional KPIs need to be agreed upon between the program and the various functions. It is good to start by identifying how loyalty can potentially impact the whole retail value chain, after base-lining the performance. While the impact of loyalty is usually felt on the down-stream part of the value chain, programs often struggle to establish its impact on the up-stream part. Execution Related Issues 1. Mostly, retail loyalty programs are configured either as an independent cost centre or as a part of larger shared services. They usually do not enjoy the structural empowerment to decide their own budgets. Even the direct payout to the consumers is decided primarily by the brands, where program managers have very little to no say at all. While some retailers did experiment with some innovative structures like placing the entity at an arm’s length and transfer pricing relationship with the brands, none saw much success. Instead they ended up alienating the categories. Management empowerment of the loyalty function should be progressively done based on the ability of the program to achieve certain performance thresholds for a given maturity. While an absolute lack of empowerment may deem the program ineffective, disproportionate and untimely empowerment may end up dividing the organization. The balancing act is in drawing the control boundary, in a manner that awards the program enough discretion, to execute its agenda, without alienating the brands or the categories. The boundary needs to shift outward as the program matures and the value creation through loyalty program becomes increasingly less disputable. 2. Retailers all over the world tend to treat points as cost upon issuance. However, this cost is often recognized as marketing cost and is expensed below Gross Margin; making redemption or breakage as a mere recovery of that cost. The problem tends to worsen, especially in the case of retail conglomerate, where many retail brands participate to form a mini coalition within the same program. Typically the brands which experience higher accrual than redemption are the ones who clamour the most. Success Imperatives While strategic challenges tend to cast a long shadow over program’s effectiveness, most programs’ incapability to harness the power of analytics to prove their worth is also to be blamed. Most of the retailers we interacted with had concurred saying, they would not hesitate to allocate more management resources to the program; if it can prove that doing so has a value. This is exactly where most of the programs fail. They fail at many levels – from target setting to measurement. Retail programs are plagued with lack of clarity and consensus. While most retailers continue to struggle with excess operational challenges ranging from stock availability, excessive mark-downs, growing reverse logistics spend or vendor negotiation, loyalty comes far down in the pecking order. Loyalty program should view all of these as their opportunities. If the program really wants to grow in prominence, it needs to share the responsibility of alleviating each of these issues with the various actors and leverage data to prove their contribution. Broader changes would fall in place, subsequently. BY SUBHRA PRAKASH NASKAR VGSOM, IIT KHARAGPUR

Google Android One: Sure-shot success or an ambitious product?


ABHISHEK GOYAL
NMIMS MUMBAI

Google Android One offers 1.3 Ghz quad core processor, 5 mp rear and 2 mp front camera, 1 GB RAM, 4 GB ROM, and 4.5 inch screen in addition to latest Android version(4.4 Kitkat) at price points Rs 6499, Rs 6399 and Rs 6299 by Micromax, Karbonn and Spice respectively. Google is looking to differentiate Android One devices through software upgrades, more local languages support and value based pricing. But majority of the target market is not aware or concerned about software upgrades. Moreover, the device partners are themselves competing against Android One phones by already offering similar or better hardware features at almost same price. Also they have plans to launch phones in the Rs 5000-6000 range which will use Android but will be out of Android One programme. In addition, there is tough competition from non-partners’ products like Moto E priced at 7000 and Xiaomi RedMi 1S priced at 6400 with 1.6 Ghz, 8 mp camera and 4.7 inch specifications. The points of differentiation being portrayed by Google are in fact points of parity for the consumer. On the other hand, it is losing on points of parity too. For instance the battery in these devices is 1,700 mAh whereas non Android One devices in the same price range offer 2000 mAh battery backup. The build quality is inferior to Moto E or Xiaomi RedMi 1S. The USP of Unmodified Android technically called as Stock Android has already been taken by Moto E. On the whole, it does not seem to be a sure-shot success with its current value proposition. As of now it seems to be an ambitious project by Sundar Pichai, Senior Vice President, Google.







RAVI SINGH
SBM, NMIMS MUMBAI

Google’s Android, propelled by its open source nature and high customizability, has become the most dominant mobile operating system, with an estimated market share of 85% (IDC Q2 2014). Now the internet power house has launched a smartphone with a Quadcore processor, 5 Mega-pixel camera, 2 Mega-pixel front camera, FM Radio on a 4.5-inch FWVGA(480x854p)IPS display along with features like Dual-Sim & preloaded Google Apps - All at a price point of Rs.6399. Google has realised the potential of India to drive the smartphone market, serving as a launch platform for its mass-market devices and softwares – (Google messenger!!). The importance of the market can be gauged by the fact that Sundar Pichai, himself came to India to launch the smartphone. Google has already partnered with Micromax, Karbonn, Spice and chipmaker MediaTek, while hardware manufacturers like HTC, Intex, Lava, Lenovo, Panasonic, Xolo and chipmaker Qualcomm are waiting in line to get a piece of the Android One pie. Android One itself, is like a reference platform where any OEM, such as Micromax or HTC can choose pre-qualified components and software to make their own version of the smartphone. Apart from keeping costs low and reducing time to market, this model enables smaller OEM at expense of larger ones such as Samsung. At this price point and hardware/software feature combination, Android One seems to offer “value for money” and an experience which will help it tap into the aspirations of users in a country where only 14.5% of the Mobile pie is owned by smartphones. Google’s strategy is to capture the exponentially increasing internet user market in Indian and get them on Android early on For Google, Android One seems to fit in as - A sure-shot success formula to reach the next 5 billion smartphone users!!!

Marketing to Millennials

Marketing to Millennials

Millennials refer to the generation of people born in early 1980’s to 2000’s. The Millennialgeneration is so named because this demographic cohort was born near the dawn of the new millennium. We the generation Y took over the mantle from generation X. The millennial generation is often referred to as the hippies or the selfie generation to differentiate from the previous generations. But are we different from them altogether? Is the generation different from the previous ones? The answer is both yes and no.



There are certain characteristics and traits which are binding for each. Every generation has the feeling that we are more progressive and smarter than our predecessor and the previous generation people also feel that they worked harder than the current crop. When generation X came into existence they made deafening noise demanding the world to bend in their direction. And they raised
their kids with even more expectations because of which the millennials are giving them a run for their money. In an organizational setup the baby boomers are characterized for working in a structured manner whereas the millennials can be unstructured and nonlinear but get the job done. Baby boomers had a sense of loyalty and wanted job security. The baby boomers are go getter and don’t mind shuffling jobs in order to reach to the top. The baby boomers preferred to work in teams rather than individuals whereas the millennials also called the selfie generation can be seeking personal glory at times. At present the size of the millennial generation is more than any generation in the world. The impact they have on marketing is also huge. A good marketer has to gauge the differences between the two generations in the right amount and change its strategies accordingly. 

Like for example Parle g biscuits boomed during the 1980’s and has been doing great business ever since. With its new marketing strategy it is further driving the point that the quality of the product has not changed at all and continues to drive revenue for the company. The millennial generation has been equipped with the latest technological developments which their predecessors didn’t enjoy. They have seen the internet boom due to which any information is just a click away for them. In order to make optimum use of the situation the marketers have to constantly deploy new strategies to meet their demand. Domino’s has delivered on this front by being open minded and acceptable to changes. They have launched their mobile apps to tap the potential of the growing Smartphone market. The application like pizza tracker provides the user the information about the present state of their order. This way they successfully connected with their customers and increased their brand value. Social media has played a paramount role in the impact of millennial generation. This generation is more outspoken and does not restrain from opining. Various blog spaces and review sites are filled with praises and criticisms of the various products. Zomato the restaurant discovery site and mobile app allows the user to share their experience of various restaurants, hotels and food joints of the cities which helps the readers to make their choices on the basis of the ratings. Because of the connect it made with the users of the site and its credible review system the big players of the food market and various restaurants post their advertisements on the site. This has been the main source of their revenue and they owe the social media space big-time for this.

Zomato App Online shopping is another aspect of the technical advancement which has enhanced the experience of the millennial generation. It enables the user to buy the product of his choice front the multiple brands on offer and also provides hassle free transactions. The timely gratification which the users get from online shopping leads them to choose it over the conventional shopping. The online retail sites like Amazon, Ebay, Flipkart etc… also stores the data of the user and provides them customized suggestions enabling the millennial generation to make a informed choice.The millennial generation has been the most educated one and as a result has more buying power. With time more and more baby boomers would be retiring and would be replaced with the millennials. This would further result in rising income with this section and that’s why it is imperative for the marketers to satisfy their needs. The millennials are concerned with the quality of the product. They want the product to be customized as per their requirement and is ready to pay the price for it. Customer satisfaction further results in word-of-mouth advertising for the product thus leading to more business
for the marketer. The millennial generation is also fickle minded in nature because of flurry of choices being offered to them. The marketers need to go the extra mile in order to gauge their attention. It is the creative advertisements that millennials respond to than the conventional ads. In spite of fierce competition in the apparel market Levi’s has been the trend setter for so many years. Customer engagement has been one of its core values and being receptive they are always able to build stronger relationship with their customers. This helps them in understanding their target audience and enables them to improvise as per the current trend. The Millennials are also known as the ‘selfie’ generation because they love to love themselves. But they are also sensitive to the society’s wellbeing. Our generation has grown in the time of people being socially active. The common mass has joined hands to fight the evil of poverty and this message is ingrained in this generation. Down the line consumers would opt for the companies who brand themselves as socially responsible. ITC’s philosophy of “Let’s put India first” has promoted the sustainable development and inclusive growth. With purchase of every product of ITC it provides Re1 for it rural betterment
initiatives and has been able to successfully sensitize the current generation for social good.

The marketers need to continuously rebrand themselves and come up with innovative ways to engage its customers. They need to provide experiences to the customers to have a lasting experience. The “Open Happiness” campaign of Coke linked the experience of the consumers with their product. The new and innovative packaging campaign “Share a Coke” allowed the users to send a bottle to their friends with their name printed on it. It spiked the sales of coke in various countries and allowed the users to share their happy experiences and connect to the brand in a much better way. On the other side there have been certain instances where cause marketing was tried to engage with the millennials
but the campaigns backfired. Kellogg’s retweet for a meal is an example of it wherein Kellogg had intended to donate meal to the needy children but by some error one of its PR staff posted on the net that for every retweet that they receive they will donate a meal. They were totally misinterpreted and were considered inauthentic and power hungry. KFC’s Buckets for the Cure was a similar case wherein KFC decided to donate $0.50 to Susan G. Komen or every bucket of chicken it sold. The message that got spread was that KFC and SusanG. Komen are raising money for medical research by promoting unhealthy food. This did not go well with the millennials and they spread their distaste on the social media causing negative publicity for the two brands. Community experience is another trend that is picking pace when it comes to millennial marketing. Reebok organizes its group exercises named Crossfit which engages the group of people to participate together. In this way it promotes the importance of exercising and simultaneously makes its consumer loyal towards the brand. The company which creates a perfect working environment for its employees is the one which is most loved by the general users as well. Take for example the case of Google. It is the
most loved brand of the world. The employees of Google are so satisfied working there that they always go the extra mile to improve its services to the users. With the shift in generation there has been a noticeable shift in the marketing strategies of the brands as well. Change is the only constant. And the companies who have adopted according to the changes have been successful in marketing to the millennials. The brands which cater to the needs of the millennials and position its products accordingly will only be able to sail and the rest will just float.

BY SHUBHAM BADKUR JAIN
IIFT
PERSPECTIVE SEPTEMBER 2014


Vartalaap: An Interview with Mr. Ashutosh Tiwari


Markathon: What motivated you to pursue an MBA after doing CSE at NIT Warangal? 

Honestly, I stumbled on to MBA. I was already doing B.Tech in CSE, and I had already been placed. A full year was left, I had already finished my final year project. I really did not know what to do. I was in a lot of clubs like the Debating Club and my friends encouraged me to go for management. I had just given my GRE, but my friends said I should at least try (management). I ended up applying for three institutes, out of which, one exam I did not even appear. The second one I opted out midway because I found it so boring. The third one is what I ended up completing, and once you get selected and you get a good rank, then the pressure starts that how can you leave an offer like this. I had a job with Wipro Systems, I had a good score in GRE, but after I got selected into FMS, I was more like “what is this management all about”. And then I started reading up about it, I started liking Strategy and Marketing as subjects. In reality, however, my Computer Science has helped me as much in my management as my MBA. So, I didn’t see too much of a difference between them fundamentally in terms of problem solving. While management has taught a lot of skills, the aptitude of problem solving still comes from graduation days of CSE. The entire algorithmic approach of tracking down a problem into sub-parts and then putting a solution together or even going bottom-up is an aptitude that forms early. And somehow I found management interest-ing and challenging because the same approach can be applied to real life situation in which factors and variables not under your control, are far more than the ones that are under your control.

Markathon: The Godrej brand was re-launched in 2009. How did this concept come about? What factors did you have to keep in during the re-launch and what challenges did you face?

 What we see eternally as re-launching a brand is part of a bigger journey. Godrej had been 110 years old as an enterprise and we knew that the brand was its most valuable asset. But, the brand had never been managed coherently. While the group had always been more consumer-driven, there was a drive to make the brand more strategic and consumer-centric. We felt that some of the capabilities that we were over-indexing the market on, were more on entrepreneurialism or operational excellence. So, without letting go off entrepreneurial spirit or operation excellence, how do we become more strategic and consumer-centric? The best way to do that was through Godrej brand. We started upon a journey which was very business focused, unlike a brand-focused journey that didn’t really start off with like let us reposition the brand or communicate the brand differently. It was more authentic and deep-rooted than that. The whole idea was that how do we build value into the Godrej brand? And how do we then transfer this value of the brand into the actual P&Lsof the business. This involved working on three parts: consumer and brand, businesses and strategies, as to which of the businesses we will be focusing on, which will build equity and monetize, and the third was internal, related to the culture and employees. That was the kind of beginning of the journey.

Markathon: Godrej entered the virtual world with GoJiyo.com in 2010. In retrospect, how successful was this move according to you? What do you think is the road ahead for using digital media in marketing and branding exercises by Indian companies? 

At that time, one of the biggest challenges for Godrej while repositioning itself, was to be more relevant for a newer psychographic of consumers in India who are more optimistic. According to our research, around 65% of Indians were attitudinally optimistic and half of them, around 35% were behaviorally so. As we were going around renewing our relationship with them, there was a big chunk of customers who were younger, younger than may be 25, who were not really in the network of Godrej. And we needed to reach out to them. But, we did not necessarily have the product range to start conversing with them in a manner that was authentic. That is one of the reasons we said that we need to create a platform. One of the things when I was on that road that I stressed on, was that I was not really in favor of just general corporate advertising. So, we need to create something that consumers can touch, feel and receive rather than just passive communication. It did not start off with GoJiyo. We figured out that internet is obviously becoming huge (by that time mobile hadnot become as huge as it is today). Internet penetration in India that time was close to 9-12%. This, in a country like India, actually translates to almost 30- 40% at a household level, because in a typical household only 1-2 people come online. So, we thought it is a good idea to create a virtual reality world. It went to break a lot of records and did tremendously well as a brand for us. And if I remember correctly, purchase intentions for Godrej on a scale of 1 to 10, will be 9% on a 10 on 10 level for consumers went up to 23-24%. This happened among youth because of GoJiyo, and we did not only create a virtual world, we advertised it, created a lot of episodic stories around it. It went on to bag a lot of international awards (was rated one of the top six most innovative social networks of the World, became a case study and many more). We had a benchmark because of some other properties that we had done earlier. The most successful digital property before that was, I think, Gang of Girls. They had around 600000 users, in about 5 years. We were like, if we get there, then we have done something. What was very funny is the fact that we got 1 billion users. We got 1 million visitors spending an average of 3 mins on the platform, we had 200000 users going inside the world, spending on an average between 35-60 min per person. It was massive. It was valued independently by Dun and Bradstreet as a 100 crore plus. We never envisaged it to a business, it was always envisaged to be a brand acquisition property, which has a life of its own. We sustained it for about 4 years to come up to a level, and now my successor is trying to experiment with certain things to take it to an another level.

Markathon: You moved to corporate role in Godrej Consumers after a considerable experience in the FMCG space. What kind of trends have you observed during this shift and how do marketers cater to the different consumer requirements and perceptions in each space? 

There are some very interesting things in this business which have got to do with value. How do you create value, how do you create P&L in a business like this, say consumer durables, where most of the consumers want to go to a carpenter to go ahead and get their furniture done. They may come to an exhibition, see your furniture and like it, pick up your catalogue, take a few pictures and then again go back to a carpenter. So, how to create experiences which are irreplaceable? In order to do that, you need to have technology into your products, because our neighborhood carpenter can never incorporate technology. So, Interio started incorporating technology for superior experiences. The other interesting part about this business pertaining to consumers is that, they are increasingly becoming design conscious. While it is still very expensive to do décor for someone, and décor is nothing but taking two different types of designs and make them interact with each other and come up with a coherent design language. So, consumers tend to use a lot of small articles such as curtains etc. in furniture to make it more harmonious, despite different individual pieces being distinct from each other. So, how do you get into those fillers, and bring them to market to help create décor? These are some of the things that this business oftengrapples with. 

Markathon: What kind of disruptive innovations is Godrej Consumer Durables looking at to cater to the rural market in India? E.g ChotuKool was launched by Godrej in 2006. 

There are lot of innovations that we are doing, going down the pop strata, whether it is Chotukool or smokeless coils, recently we have launched household insecticide, coil card, which has been quite successful for us already. Godrej No. 1 is quite successful, its Go-To-Market strategy is very different from a lot of other products. So, depending upon the category, most of the rural facing brands will tend to have a different activation strategy as compared to others. Having said that, rural and urban aspirations are similar in some ways and distinct in other ways. So, our strategy has been to build strong brands, which appeal for different reasons to different constituencies of rural and urban regions, rather than have different brand for Rural and Urban India, because that clearly doesn’t work. The manner of activating them could be different, but they are essentially the same brands.

Markathon: When you joined Johnson & Johnsons as Senior Product Manager in the women healthcare segment, the Indian market in this segment was undergoing a radical change. What challenges did you face in your role and how did you overcome them?

The penetration of sanitary napkins in urban India was 20-22 %. In a place like Mumbai, in a locality like Malaba, which has the crème dala crème of the society, penetration of sanitary napkins was not more than 40%. The reasons were not behavioral, but deep rooted, cultural and emotive. And they had to do with the society’s view of women as well as women’s own view of themselves. That is one of the parts that we started impacting a lot. There was a category development that happened at that point. The second thing was simply bringing down the excess cost of sanitary napkins. In a market where an average sanitary napkin’s cost was Rs. 45-60 at that point of time, J&J brought up a brand called Stayfree Secure which at that point of time cost Rs. 20. Because most of the people who were using home-made napkins were actually not paying anything, hence it was really important to cut down the cost. The third thing was that we started talking to mothers, not just about themselves, but also about their daughters through brands like Carefree which used to hold 15% market share. We started telling that girls at menarche need help and support, but at the same time, mothers want to live their dreams with their daughters. Whatever aspects of life that they could not enjoy, they wanted to give to their daughters. And somewhere exhorting their daughters to go for branded, good quality sanitary napkins became a reflection of their own aspirations. There are two challenges that as a marketer you need to cater to. One is the behavioral aspect, which can be impacted through innovations as well as lowering the costs. Second and the most difficult one is the cultural aspect, the way womenthink themselves and each other. In several attitude studies, you will find women see this as a matter of shame, which I the part that needs to go away. 

Markathon: What is the one piece of advice you would give to budding Marketers? 

The only one advice will be that marketers take marketing too seriously and they do not pay enough attention to business. So, they still think that as a consequence of finding great insights, for example, or in order to delight the consumers, it is enough to do differentiated and relevant communication or design or innovation. But in reality, what they need to think about is that if this is the consumer I need to target, and this is the reason, then how do I design an entire business around it rather than differentiated communication and innovation or even activation for that matter. Most of the businesses, globally and in India, which have been successful, are those which have been wired to a certain type of consumer. So, their entire front end as well as back end strategy has been premeditated on that. Thus, you need to be more of a Strategic Marketer rather than a Consumer Marketer. Consumer Marketer says that I will do certain things to delight a chosen consumer, it is fair, but you can’t go bankrupt doing that. So, strategic marketer choses among different consumers and different offerings, which will be profitable and then engineers an entire business to delight that consumer. This is mistake that most of marketers end up doing. They only think about consumers and market in isolation of the business and P&L.

Sunday, November 9, 2014

The Myths of a Loyalty Program

Yash B. Bhambhwani | IIM Shillong

It was always believed that for a retail outlet the biggest competitive advantage was its location, but with passing time this did not stand true as consumers had a large number of options available. Once location has played its part, retailers end up in a struggle of maintaining low margin and high costs. In such kind of businesses, price wars can’t be avoided. 
In this business differentiating on basis other than price is a challenge as it requires a lot of innovation and as time passes the price war continues to increase. It is therefore not surprising that many retailers have adopted loyalty programs as a convenient mechanism of meaningful differentiation.
Businesses grow by either customer acquisition or by getting more business from their existing customers. Customer acquisition is invariably expensive. For every successful promotional activity (spending money and gaining a new customer) there is a vast amount of wasted promotion. Attendance at a business exposition may involve hundreds of hours of expensive staff time to yield a few dozen good prospects of whom a mere handful can be converted into profitable customers. Firms that search for new customers by unsolicited catalog mailings are often delighted if the response rate is any more than just 1 percent. That is, 99 percent of the costs of printing and mailing are a dead loss. 
It is much cheaper, then, to get more business from existing customers. Firms do this in two ways: Getting customers to buy more when they buy or by getting them to buy more frequently. Getting customers to buy more usually involves some kind of sales promotion such as a bundle with an attractive package price (for example, season subscriptions to theater or concerts) or promotional discounts for quantity purchases. “Buy more” can also involve “upselling” the customer once they have made a decision to buy. Examples of upselling are add-ons such as selling spa services to a hotel guest or getting a firm that has agreed to purchase software to also pay for staff training. The second way to get more business from existing customers is to get them to buy more often. This is where Customer Loyalty Programs are most successful. 

THE EVOLUTION 
Although various forms of customer loyalty programs have probably been around for millennia, Leadership in the modern form is largely credited to American Airlines AAdvantage program begun in 1981. American’s charismatic CEO, Robert Crandall, moved the airline from thinking about selling tickets to thinking about their relationship with specific customers. 
Crandall noted that the airline business exhibits an extreme form of the “80/20 rule” (that 80 percent of profits come from 20 percent of customers). In the airline business more than half of all passengers may take only one trip a year, whereas the top 5 percent of customers may buy more than 20 round-trip tickets a year.
After segmenting the market for airline tickets into leisure travellers and business fliers, Crandall noted that the frequently-flying business customers are delightfully price-insensitive. While leisure travellers are brand disloyal and always search for the best deal, business fliers are concerned primarily about schedule convenience. The costs of airline tickets are relatively small compared to the full cost of sending an executive on a business trip, especially when the cost of the traveller’s salary are included, and are very small as compared to the benefit hoped to be earned by taking the trip. American airlines knew from marketing research that some of its best customers were disloyal: Since major airlines offered a largely generic product flying identical planes with only superficial differences in service, if an American routing offered a slightly less favourable time or the need to change planes on a cross country flight, good customers would choose a flight from a competing airline. 
The points awarded by the AAdvantage program were meant to tip the balance towards always flying with American. For each mile flown, a customer would accumulate points. When a threshold was reached, the customer could trade those points for a free trip. The motivation to always travel on American Airlines then became this: for a modest amount of schedule inconvenience, a business traveller could earn points from business trips (paid for by his or her company!) And then use those points for a vacation trip. The motivation was compelling. 
All said and done these loyalty programs play a significant role in the business world today. In spite of all its advantages there exist certain myths about loyalty programs. 

UNCERTAINTIES, AMBIGUITIES, AND DOUBT 
The feasibility and profitability of loyalty programs has been debated highly in marketing literature but there still exists an element of uncertainty, ambiguity and doubt if it is sustainable.
A major part of this doubt can be explained through three myths: (1) architecture of shopper reward (size and convexity of rewards), (2) architecture of retailer rewards (horizontal competition) and (3) type of retail sector (frequently versus infrequently purchased goods). 
We discuss each of these myths in turn.
SIZE OF THE REWARD 
Many grocery stores believe that the size of the reward does not matter when it comes to generating loyalty. Chains like Reliance Fresh, More etc. believe that their 1% to 2% payback are sufficient to build loyalty. This does not stop them from executing their loyalty programmes. This type of a reward is actually a “thank you” to the customer from the store for the privilege of collecting a loyalty card. Can such small rewards lure a customer to favour one retailer over another? Will the customer show his support by spending a major part in the particular store for 1% to 2% payback?

The rewards can be categorized in to two broad categories:
 a.Turbo charged vouchers: These vouchers provide a particular multiple value at different locations like partner hotels and resorts etc. 
b.Tailor made coupons: Based on the data collected about the customer we make tailor made coupons for them
So, from the perspective of the customer the value of the above loyalty rewards is more than the 1% to 2% payback. This makes them reconsider their decision of switching from one retailer to another. Therefore the fact that the total value of the reward is not significant is a myth. 

CONVEXITY OF REWARDS 
Convexity of rewards refers to the fact that all loyal customers cannot be treated similarly and so we need a stratified loyalty program for it to thrive. One approach to achieve this convexity in rewards is to create loyalty systems that are tiered. It is often debated that tiered rewards, such as those offered by hotels, airlines, casinos are necessary for loyalty programs to thrive. The idea behind this is that the customer should realize what he is losing if he does not accumulate points at a particular chain. Furthermore, tiered systems can stimulate customers to in- MARKETING crease their purchases to reach the next stage-and therefore more and better rewards-in the hierarchy of loyalty classes. 
The belief that loyalty programs lacking explicit tiered reward structures are ineffective is a myth. It is considered to be a myth because many retailers do not provide tiered loyalty programs but are still successful as they provide tailored offers to loyal customers. This is of more value to them than being a gold or platinum customer. 

LOYALTY SYSTEMS AND COMPETITION 
“I am very loyal to my store; I have loyalty cards from various retailers!”
 In retail of grocery the shoppers hold loyalty cards of multiple retail changes. This poses a challenge to the success of the loyalty program as the share of consumer’s wallet is distributed. Therefore there exists a common belief that the loyalty programme fails in this case.
However, it is a myth to believe that loyalty programs are ineffective when consumers hold loyalty cards from multiple stores. Though the customer hold loyalty cards from multiple stores he spends about 2/3rd of his budget to purchase items from his favourite store. For the shopper, the dominant store will have an informational advantage over less patronized stores. 
There also exists an unmentioned cooperation between these retail chains. As observed above that there exists the concept of a favourite store which has the advantage of information availability over the other retailer. Therefore the competitor does not try to attack the customer base of the other retailer as it may attract retaliation from the retailer who is being attacked. 
The condition for a favourable equilibrium for all loyalty driven retailers is that all players are reasonably satisfied with their current market share. If some retailers want to gain market share at the cost of reducing profitability, this will inflict a price war in the market. This will hurt the profitability, but with a result where the least priced retailer will earn the maximum market share which will benefit the customer but will hurt the market on the whole. 

LOYALTY SYSTEMS AND FREQUENTLY/INFREQUENTLY PURCHASED GOODS 
Many industries including retail believe that if the purchase of the product or service is not frequent by the consumer the loyalty program may not be effective. Considering the example of an airline company, airline companies provide frequent flier miles which can be accumulated and be redeemed for a free travel once a certain amount of flier miles are accumulated. In this case if the consumer is a business traveller who frequently uses the airline, this loyalty program will be successful in gaining this customers loyalty as he believes that he can accumulate sufficient miles to redeem them. In case of irregular flier who probably uses the airline once in a year the target is not achievable and the loyalty program will not affect his decision while making a second purchase. 
This myth has been found to be true but various businesses have found their way around it. In today’s time these retailers associate with other services where these points can be redeemed. This makes these points more useful for the customer. The other alternative is to provide levels in the loyalty program and as the consumer proceeds to different levels it becomes easier for him to accumulate these points. These solutions are being tested in various chains and the results are yet to be analysed. 
One new recommendation that is being appreciated by the industry is partnerships. In this process the business finds a sponsor to sponsor the loyalty program from which he can accumulate data of prospect customers for his own business and profit. This has been tested and in the time of big data is being seen as a lucrative source of data by companies. 

SUMMARY 
Many retailers are hesitant to adopt loyalty programs as they doubt that it will be sustainable. Retailers also doubt the profitability and returns of these loyalty schemes as they already run on low margins. 
But as we have proved, these myths not really true, and a variety of these programs can be refined by retailers to achieve differentiation and increased profits. When location, location, location does not suffice to attract customers, a loyalty program that apprecia te s their loyalty will be.

Rural Entrepreneurship Marketing: Through E-Commerce

Anu Kaushik | Bharati Vidyapeeth Institute of Management And Research, New Delhi


With the ascent in use of web and making enthusiasm among people in India, the e-Commerce space has touched the new statures. More people and associations are presently capitalizing in ecommerce to enhance and shape their business. Breaking the conventional promoting methodology which had a standpoint of print media ruled as an initially limited classified service, electronic commerce has changed this long recognized trend to the expediency services for customers.

 Today, numerous organizations are picking up accomplishment through conveying this innovation and to attain their position in the market. Not simply household benefits, moreover globalization of business on a worldwide reason has created enthusiasm for the organizations which confide in “development” through ecommerce. Also, this won’t just improve the trade of firm, however will also give a stupendous stage and an alternate open entryway for creating profits through different channels of distribution.

Moreover, the speedy move of e-Commerce as a genuine business has pulled in a lot of little organizations and goaloriented individuals’ interest. It is renowned in urban region of India as well as famous among rural and private groups who are presently centering more on such technologies and by grasping these opportunities they are trying to create awareness about their products among urban clients. This dynamic change is bringing care to such rustic business visionaries who have limited their source to physical conveyance. Presently they can without much of an effort show and offer their items and diverse pleasantries to the individuals on the web. Giving simplicity in service to clients and offering uniqueness of their products to the world, such rustic ambitious people are progressing and adding qualities to their organizations.

 Ecommerce Penetration in Rural India

 Ecommerce today is a crucial component which has gotten to be noteworthy piece of smart and quick way of life for a number of inhabitants in India. Nation today is at the edge of computerized transformation. Declining expenses for broadband membership, underpinned by the dispatch of 3G service, web entrance in residential communities and rustic territories have expanded gigantically. This has incited a rising number of “netizens” in urban and rural India, as clear from the report of IAMAI, which has expected that India will have more than 243 million web customers by December 2014. It has additionally expressed that with the advancement from year to year, the improvement in number of sites created by provincial and rural area businesses will further increment to 28%.

A huge 63% of rustic e-commerce ventures have been started by entrepreneurs who show guarantee to ecommerce sector, an assurance by considering the growth and development and with consistent effort they have grabbed a lot of consideration of all huge and small sizefirms as well as funding speculators.

A Case:

An attempt has been made to showcase how rustic business visionaries have utilized and aimed to create benefit through ecommerce. By finishing unprecedented strides in mounting firms and delivering jobs over the late decades, they have likewise confronted numerous challenges and difficulties. To that end, an illustration of organization has been considered i.e. www.mitticool.in, which has effectively used ecommerce as a marketing tool for generating awareness among clients about its services and products. A representation about the case is given:

Mitticool Clay Creation
Dist: Rajkot (Gujarat) India
www.mitticool.in

Mitticool is enrolled trademark/brandmark of MITTI COOL CLAY CREATIONS, an ISO certified organization. The organization designs and creates a whole run and assortment of earth items for general use in the kitchen like hot plates, cookers, fridges, water filters and other such products of commonplace utilization. It was established by Mansukhbhai Prajapati. He is a pioneer and visionary man who produced a creation like mitticool fridge that did not require electricity or solar power and could be used by many. Mansukhbhai had exposure to the clay tradition and practices since adolescence, as this was his father’s established profession.

Thus, by commercializing these products and now considered as a successful entrepreneur, owner has also created his organization dynamic on online networking and has site for producing business- www.mitticool.in, which was started in 2009 and works till date. The firm has given complete information about the holder, products, their achievements, media updates, request forms & contact details on the site. This allows their customers to contact them for telephonic orders, requesting information that helps them to easily enquire through emails. Also, the association offers its items online through Craftsvilla and Nethaat, where web shopping cart is available for its customers. Additionally, the firm also enthralls demands and requests orders from their Facebook page. Therefore, it is evident that organization has created awareness to customers through ecommerce and capitalized it as one of the effective marketing tool.

 Producing great web vicinity has put www.mitticool.in on even hold and equalization with bigger contenders and a fortune by keeping site on first page of search optimization is an alternate commitment to business. Mansukhbha, by joining few present day practices of e-commerce, has possessed the capacity to procure profits for his firm. Through internet presence and website, it clearly depicts that the owner is trying to expand business and ecommerce is playing as a source to market the firm effectively across the world. It is not only creating awareness among the people, but his brilliant innovations like clay fridge are enabling him to take orders easily through internet where his physical reach is not possible.

Conclusion:

 Through above case, the careful investigation delineates that numerous country entrepreneurs today are either arranging or stretching to new markets, dealing with their client base, enhancing their operational adequacy and business limits through productive utilization of technology. This has changed the mind set of individuals living in rustic and urban areas that entrepreneurs are not only aware about such technology but many of them have exploited it to a large extent with their accessible capacities. They have also thought of delivering it prior to their competitors by monitoring changes occurring rapidly in these sets of tools.

It has been said that the urban individuals can undoubtedly utilize the facilities offered by such organizations yet question arises mostly what keeps rural purchaser from asking for online orders to his/her doorstep? One snag could be the nonappearance of online installment instruments like credit/ platinum cards or net-saving money preventing these purchasers from buy. Regardless the circumstances are evolving rapidly, with rustic and residential area firms like mitticool. Numerous others have offered different options to such customers through their sites. Now customer’s mostly rural clients will be more familiar with organization’s product and can easily call for home delivery through a telephonic order where numbers and email address are provided on their websites and product will get deliver according to customer’s convenience, creating rural to rural reach.

Therefore, it is true to say that dipping reliance on retail deals, Ecommerce is playing a crucial role in expanding awareness of the product to comprehend and manage the demand of buyers and has become one of the major marketing tool for the businesses mostly rural entrepreneurs, who with their limited resources are trying to make it big.

Marketing Shift from Firm to Consumer

Venkatesh KG | Great Lakes Institute Of Management, Chennai

Marketing is shifting from mass communication to individual, one to one interaction with the integration of various digital technologies like SMAC. Also marketing strategy is shifting from product push to customer pull strategy. Digital marketing is picking up fast and intense market research is being resorted to by companies on their products to understand customers’ preferences and sentiments before targeting/positioning their products and services. Companies have started having their webpage in various social media platforms and are advertising via social media to reach to a wider segment of customers. Content management has become a crucial aspect in social media marketing as it is the content which delivers the right message to the end users. The number of competitors in each industry is increasing and each is following a different marketing strategy like
differentiated pricing, adding unique features to their products, providing value added services and positioning their products after evaluating the existing trends, expectations and assessing the distinct features in their competitors’ products and services. There are several instances where the strategy/market position has increased the brand proposition and a few of them have gone wrong
disrupting the performance of their brand in the market. I would like to cite a few specimen cases indicating the diverse issues involved:

Food & FMCG domain:


McDonalds had never introduced vegetarian options in any nation. To cater to the Indian market, they have introduced vegetarian novelties like Alootiki/ paneer tikki burgers and maintain separate kitchen for veg and nonveg food

Pizza Hut have customised their pizza to Indian market by introducing Indianised flavours like Tandoori paneer and paneer makhni amongst others
Cornflakes is thinner in foreign nations than in India as foreigners have the tradition of consuming flakes with cold milk but in India, we consume with hot milk.Thinner cornflakes were getting reduced to porridge when mixed with hot milk. So they had to introduce thicker cornflakes in India
Cadbury Dairy Milk was targeting only youth earlier. But when they positioned their product as a family product by engaging the popular Amitabh Bachchan in their advertisements, sales increased by more than 5%
Chick shampoo of Cavincare targeted rural market by introducing sachets black in colour, having less quantity of shampoo to meet and satisfy and suite rural people’s sentiments and requirements
Apple pricing strategy is skimming followed by penentration. They initially price their products high to target the set of customers who are willing to pay high and get the gadget at the earliest. The moment a new version is released, the previous version of the product cost is re-duced to target customers who are interested in purchasing their product at a lower price.
News feed in social media is so designed such that customers get news feed on the products and services based on customers’ internet search history.
In FMCG sector, companies package their products differently for rural and urban markets. For Rural markets, they target sales with smaller packaging and bright colours, while for urban markets,
they come up with larger packets in sober colours.



Retail domain:


 • Many players have come up with customer centric loyalty program, membership cards and competitive pricing strategy to enhance their market share
 • Based on earlier purchase patterns of customers for specific categories of products, select customers often get email and SMS alerts on special offers on their historically preferred products using SMAC technology
 • The product line-up in modern retail outlets are so designed to keep the essential items at the far end of the row so as to offer better visibility for optional products to end customers

Other Industries:

 • Nike, Airtel and Dell have introduced an interactive portal allowing their customers to customise their orders according to their respective requirements
 • Ericsson, when introduced its high-priced mobile phone in India during 1990s, it targeted the upper class folk by having their advertisement telecasted in a Five Star hotel favoured and frequented by the elite, also the ads had a classy look
As observed, products and services are becoming more and more customer-centric out of mandatory needs and necessities and the products are shifting from mass production to customised production to cater to individual customers’ choices. However there are instances where the strategies opted by some of them didn’t work because of improper assessment of customers’ choices and needs and insufficient marketing research.

 • Tata Nano priced at just rupees one lakh and equipped with all the basic features required for a car, they positioned it as the cheapest car in the world. This hurt the ego of the purchasing people and many of them were unwilling to purchase.So Tata could not achieve their targeted sales figure. Tata Motors, post the initial setback, has decided to upgrade the features and are now positioning it as an Ideal urban car.
 • McDonald’s “When the U.S. Wins, You win”: McDonald’s came out with a campaign to increase sales that if US wins in 1984 Olympics, the customers would win a “food item”. Gold medal meant Big Mac, silver medal meant fries and bronze a Coke. Soviet Union boycotted it that year, and the U.S. took home 174 medals, including 83 gold leading to unprecedented outgo of freebees. The result indicated that one should not strategize in an entity where the end-result is un-predictable
 • New blue coke: Because of high competition in the cola industry, Coke introduced sweeter blue coloured coke. However higher sweetness and blue colour associated with the edible items was not welcomed by customers. The reason for the failure was presumably portfolio misfit
 • Toilet to Tap: This deals with innovative waste-water recycling in Orange Country, California. Though this project was successful in providing water for irrigational purpose, it was not successful in drinking water segment though it was advertised as the President of the nation drinking this water. This was attributed to the psychological factor, the “yuck’ factor” among the people.

 Now many companies have started bringing customers into their organization to explain them the stories and also establishing customer advice panel for providing ongoing inputs for new product or service development.

Takeaway:

 • Once the product has matured, proper action has to be taken to assess and cater to the latent needs of customers and differentiation has to be conveyed properly

 • Sufficient time and money has to be invested on market research to understand the changing customer sentiments. It has to be done not only at one place, but across the target geographical locations. Based on favourable responses, new products can be launched, or existing products redesigned

• The products have to be marketed in such a way that by purchasing or using it the ego of consumers is not hit

• Customers now are relatively better informed and educated on products and services than before, due to the advent of technology and advertisements. Proper planning is vital and has to be done while developing new products so that the promised services match and excel the services provided by competitors

A customer-centric strategy can enable companies to understand the changing customer needs and the price customers are willing to pay, and consistently deliver on their promise to customers

Better assessment and better days!!