Cover Story
May 2012
Our Vartalaap for this month features Mr. Sachin Gupta, Associate Dean for Academic Affairs, Johnson Cornell University and Professor of Marketing at the Johnson Graduate School of Management. With an expertise in Data driven marketing, his research focuses on interesting areas like measurement of returns on marketing investments. With special interest in prescription drug, consumer goods and hospitality industries, one among his many awards has been the Cornell Hospitality Quarterly's best paper award for his article on customer satisfaction in the restaurant industry. With valuable inputs on different industries and quantitative marketing techniques, readers would definitely not want to miss this interview. With busy schedules for those enjoying their work lives and lazy vacations for those relaxing in the luxury of their houses, hope this issue brings about some variation in your daily routine and takes you back to the good old days of Mickey Mouse and Tom and Jerry. Do give us your feedback about this edition and suggestions for the magazine at markathon.iims@gmail.com. Sit back and enjoy this edition! Regards, Team Markathon
Creative Designers
Priya Kumari Agrawal Rushika Sabnis
CONTENTS
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PERSPECTIVE
GREEN MARKETING: A NEW TREND BUT IS IT WORTH THE BUCK SPENT ON IT? NINAD BHANGLE | IIMINDORE
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VARTALAAP
MR. SACHIN GUPTA ASSOCIATE DEAN FOR ACADEMIC AFFAIRS, JOHNSON CORNELL UNIVERSITY & PROFESSOR OF MARKETING AT THE JOHNSON GRADUATE SCHOOL OF MANAGEMENT
WAR ZONE EYE 2 EYE Is cricket still the USP for IPL? Sriharsha K.V |IIM B| Pradeeba |IIM S SILENT VOICE IPL 5 SPECIALS RADICAL THOUGHTS
PIYUSH AGARWAL | IIM S
ADDICTED
BOOKMARK UPDATES
SOWMYA | IIMS
perspective
these brands. Many of the foreign companies have their research and development departments in India. FMCG sector is one of the fastest growing sectors is the world and in countries like India where there is a huge rural population representing untapped potential the growth is even faster. There are many variants of a product be it a soap, toothpaste, or any other product. Hindustan Lever Limited (now Hindustan Unilever Limited) is the largest FMCG Company in India. It has earned the reputation of having the widest product range and the reputation to access the remote rural areas through its distribution strategies.
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towards a wrong or a small customer segment. Though player, availability of unlimited resources with the HLL was earning hefty profits from its target segment British giant, increasing middle class population, etc. but the management missed out a vital source which More or less it was a cake walk for HLL. The HLL higher could have made it a hit amongst management was satisfied with its the poor segments. Mr. Patel on current target market because it the other hand had limited was providing it more than enough resources and it was a total one revenues. For them the real India man show but he had an was less than the top 20% range of understanding of the Indian population that they were servicing markets. A desi brand combines through Surf. This means that HLL socio-economic factors with the was ignoring more than 70% of the cultural factors which is not done Indian population which suffered from poverty just because it was not by a foreign brand. their target market. It didnt take to HLL was constantly aware of the notice the needs of this sector advancements that Nirma was which was deprived and was Mr. Karsanbhai Patel making in the Indian market but present in remote rural areas. the management never wished to enter the cheap segment discarding the opportunity In 1969, Dr. Karsanbhai Patel a government employee until it started becoming clear that it was necessary to manufactured a detergent powder. He had a small tap the segment. It was in 1985 that HLL management place to live in where he started manufacturing this realized that something needs to be done in order to powder and selling it to people in his village. The biggest advantage of this detergent was that it had a combat the situation. cost of just Rs. 3.5 as compared to Rs. 15 One of the major advantages with the foreign MNCs of HLLs Surf. The brand was is the large kitty of resources in terms of money named Nirma. Mr. Patel started they have. This advantage makes it possible for selling the detergent locally and these companies to revamp their strategies and soon it became a local hit. He reposition their brands. Positioning errors made by started expanding operations a foreign brand can be slowly and the detergent became corrected due to vast the most demanded detergent in resources but to do the country within a decade this first a surpassing Surf. The Unique Selling realization is Proposition (USP) of Nirma was its target important that market. Unlike Surf, Nirma targeted the poor there has been an segment which amounted for majority of the error. Indian population. Nirma was a good quality and ultra low cost detergent. Mr. Patel was successful in After analysing the situation HLL studied the situation identifying the pulse of the market. carefully and came to the conclusion that to gain the The difference between a local and a foreign brand is evident from the beginning of the chapter. A local brand understands the needs of the majority population. Cultural element comes into place when a local brand tries to tap the market. On the other hand, the foreign brands have excellent marketing strategies but most of the times the strategies are directed lost position it is important to reposition the brand. It had to target the poor segment; marketing channels were to be developed to reach the remote rural areas. The drive started somewhere around 1990 when HLL aggressively started forming marketing and distribution channels. It ensured that the product reaches the bottom of the pyramid.
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Mr. Patel very successfully adopted the approach that famous management guru C.K. Prahalad advocated and that is to target the bottom of the pyramid. Big companies always thought that bottom of the pyramid can never lead to a profitable venture because of the low margins that are to be kept keeping in mind the paying capacity of the segment. But the belief was cut down by Nirma which showed that although the margins are low but the enormous sales potential helps to maximise the profits and popularity of the product. The next big challenge with HLL was price. Since Surf was a premium brand with high operating costs, cutting the price could have meant loss of the premium tag as well as low profits because the price could have never been reduced to the price that Mr. Patel charged for Nirma. Once again the abundance of resources came to help for HLL and in 1995 it launched Wheel its low cost detergent in direct competition with Nirma. Within years HLL regained its lost position and today both Nirma and wheel are in a constant fight for the top spot. Though conditions have changed and the competition now is very high still the brands are holding on to their markets. Now, let us analyse what was it that favoured Nirma and what favoured Surf. Here we try to generalize and state Nirma as an example of Indian Brand and HLL as a foreign brand:1. Mr. Patels extensive knowledge about Indian market and understanding of the psychology of the customer helped him to make Nirma the most popular brand of India. He knew the problems of supply chain and slowly developed his network deep in the rural
areas where his target market was present. For this he ensured that Nirma reached every small shop in every locality to generate demand and awareness. 2. HLL on the other hand has extensive resources with which they have the choice of altering their strategy at any moment of time in future. They have the management know how and once they know what is their target segment they can device excellent marketing strategies. Due to huge resource pile they also have the power to create their own distribution channels around the country to reach small retailers faster than any Indian company. It has the power to launch multiple brands which can upset the sales of Nirma which may not have the resources to launch more than one brand. If we try and analyse the problems faced by Indian and foreign brand it becomes almost reverse of the advantages. An Indian brand mostly lacks resources to spread their wings after a certain level. The profits from the existing products need to be re-infused in order to carry forward the expansion plans. The foreign brands on the other hand lack a local touch and the thinking pattern is different till the time someone teaches them the right way to do things. But foreign brand are quick to rebrand and reposition them. An excellent example of adjusting to local customs is of Walmart in China. The retail chain has adjusted to the demand of the Chinese Government as well as the local customs. Conclusion What is needed? So far we have discussed about how foreign brand like them to be positioned in a particular market particularly when they are the first movers in a particular sector. We saw the tactics and power they have to completely change the market and the aggressiveness with which they respond when countered by other brands. 4 6
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We saw how an Indian brand initially is in a better position to understand the market segment. One more example of the impact Nirma created can be seen from the advertisements. Nirma claimed to wash the dirtiest of the clothes and this was shown in the advertisements too. The rationale behind this also comes into picture when we see the type of the customers that Nirma targeted. The poor class was mostly the labour class and the clothes became dirty every day, so Nirma claimed to this class the promise to wash of the stains from the clothes. Nirma advertisements always showed
markets still have a huge untapped potential which cant be converted to revenue until concrete steps are taken in order to building infrastructure. The bottom of the pyramid is the future of India because the urban market demand for many products is saturating. Branding is best accomplished when the company has the support infrastructure to market its product. We can clearly see that Mr. Patel visualised the bottom of the pyramid as the opportunity as he belonged to that group and knew the tactics to reach the target segment, on the other hand HLL targeted premium segment as it has always done in foreign countries. Neither of the two parties tried to invade into other segment until they realized that the other segment will just add to their profits and
a typical housewife washing clothes belonging to a poor or middle income family. So, the strategy was reflected in the promotional campaigns also. Now here we will address the major problem that retail and FMCG sector is facing in the country - the problem of supply chain management. India terribly lacks infrastructure that is required to penetrate deep inside the rural areas. Companies like HUL have tried their best and have been very successful to penetrate in the rural markets but this has also increased the operational costs for these companies. Appropriate warehousing facilities, proper roads, water, banking, etc are missing in the country. As said by Mr. Kishore Biyani, the founder of retail in India who owns retail chains like Big Bazaar, Pantaloons, etc that the problem of supply chain management is the biggest problem in development of India. Till the time we reach that segment we wont be able to grow at a phenomenal rate. He also says that FDI in retail is the only way by which the problem can be tackled because MNCs have the technology and funding to expand to the remotest area possible. The government should lay particular emphasis on supply chain management and should promote companies to increase infrastructure facilities in the rural areas. It has been accepted that rural
economies. Indian market is very unique. It is rightly said that there are 2 Indias within India - the urban and the rural India. The urban India has always been the favoured segment for the MNCs due to the ease of approaching this segment but now rural India has shown that the secret to success lies in the penetration power of the companies. The deeper you go to market through innovative ways the more are your chances of success. Supply chain management will help to bridge the gap between the 2 Indias and will further bring economies of scale for both foreign and Indian brands.
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Green Marketing: A new trend but is it worth the buck spent on it?
Ninad Bhangle | IIm indore
From the recycling craze of the 1960s and 1970s to the Save the Planet campaigns of the 1990s, awareness of our impact on the environment has had its crests and troughs. Over the past few years, pollution-free, gogreen, eco-friendly, environment-conscious have become buzz words. Organizations are constantly trying to come up with new technologies to produce environment-friendly products and also through non-polluting means. Marketing of such products that are presumed to be safe for the environment is known as green marketing. So how do we do green marketing? It takes place through modifying the product or the process or even the means of promotion. Right from procurement to selling, it can be applied in every aspect of the supply chain. Buying eco-friendly raw materials, adopting an environment-friendly process of production and minimizing the waste in packaging are some of the ways in which companies can indulge in green marketing. It aims to bridge the gap between marketing as it is currently practised and the social and ecological concerns of the wider marketing environment. Such marketing techniques have evolved as a direct concern in the consumers mind about the environment, and have been adopted by various companies operating in diverse domains. A classic example of green product would be ACs without CFC (chloro-fluoro-carbons) or the more recent CFL (Compact fluorescent Lamp) bulbs. A green marketing initiative would be that of State Bank of India: Green IT at SBI where by using power friendly equipment in its 10000 new ATMs, it has saved power costs and earned carbon credits and has also set an example for other banks to follow. The field has also seen new firms jump into the foray, a notable one being Green Vortex which is into recycling of E-waste, which is also a form of green marketing. Its clients include manufacturing companies, electrical and electronic companies among others. They are registered and authorized by the government bodies to handle Electronic waste in a scientific and safe manner. In this case, it is the customers and not consumers who are the recipients of green marketers efforts. The question arises: Why do firms indulge in green marketing? The first reason is psychological. For companies touting the environmentally friendly aspects of their products, consumers view the hypocrisy of producing wasteful and polluting advertising as a reflection of ethical ambiguity on the part of businesses, and are less willing to purchase their products. They are beginning to understand the impact that obsolete production practices have on the environment and also living beings. For example, the presence of hazardous heavy metals like lead, arsenic etc present in paints posed danger to the Central nervous system and reproductive systems in humans. Kansai Nerolac Paints Ltd realized this and took extra efforts to remove these hazardous substances from the process which earned them valuable brand loyalty. Green marketing helps in building the image of the organization. Green marketers have a considerably larger user base than the companies which follow conventional marketing practices. Another reason is the stringent pollution norms, government regulations and fear of objections from environmental activists. Fear of boycott or blacklisting of their products entices them to use environment friendly practices. There were instances in the past where air pollution and water pollution caused during production processes were 8
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condoned. However, this is no longer the case now. Maintaining the level of emissions below a certain level is mandatory; hence the trend of green marketing. Green marketing is effective, no doubt, but is it convenient and worth the buck spent on it? Let us
while still being effective is preferable for every marketing budget; for green marketing it is a necessity. Even for green companies that can indiscriminately spend on advertising, the majority of traditional campaigns for green products have a very low return on investment. Only a select segment of the population considers purchasing a green product, a segment that tends to segregate into communities that share their knowledge and preference of green products without regard for traditional campaigns. To access this market, companies must advertise at the appropriate venues and to the right markets to ensure their efforts are rewarded. So after discussing the pros and cons of green marketing, it is time to take a call on whether green marketing is worth the money spent on it. Research says that, once brand awareness about the green product is developed, there is an excessive brand loyalty towards the same. This can be seen by the mass appeal of Havells green CFL bulbs, which gave importance to preservation of the environment. Also, as aforementioned, doing something for the environment is equivalent to providing value-added CSR, which helps in building the brand image of the organization. This makes the answer yes. In conclusion, Green marketing is a field which has a huge potential in the future, and conscious efforts must be taken to improve products and processes and make them environment-friendly. The marketers must however realize that green marketing must not be considered as just another marketing technique aimed at gaining competitive advantage; but a technique which has long-term strategic implications. Thus, Green marketing must be pursued with much more vigour because it has a social and environmental dimension to it.
analyze this, by considering various factors. Green marketing requires a lot of investment up front. For example, Indian Oil has invested around Rs 7000 crores so far in green fuel projects at its refineries. Moreover, research shows that branding of green marketing is more difficult. Establishing repute and believability is often much more difficult for companies that are smaller and newer than their counterparts producing traditional products. Whereas traditional products are generally known to consumers, and a relative comparison can be made using previously established preferences, green products are often unfamiliar and will be judged individually upon every purchase. Branding green products is riskier due to the unknown and volatile nature of environmentally friendly products and customer reaction towards the same. Additionally, the benefits that a firm would reap out of green marketing efforts would depend largely on the sensitivity of the consumers towards the environment. Since the investment too is high in some cases, the break-even would take a longer time too. Green marketing is a niche field; and hence green products must be positioned in that way. Carefully optimizing marketing efforts to target a niche market
Cover story|Global Design for Indian Fashion story|How Animation Drives Business
At a tender age of around six years, a small boy was making money by drawing the photo of his neighbors horse. At around twelve, he was introduced to the world of motion pictures. From a cartoonist for school newspaper to a professional newspaper artist making comic strips to creating full time advertisements, this man explored all available options to learn as much as possible from the world around him. By borrowing a camera from work and reading books, he started his own company. The man is none other than the late Mr. Walt Disney and thanks to his imagination today we have the fantasy filled world of Disney! How painful would it be to imagine a childhood without a Mickey Mouse or a Donald Duck! From being a kids only thing with cartoons to a complete family entertainment, animation industry as well as peoples perception towards it has matured a lot over the period of time. The industry visibly came into existence somewhere in the early 1900s and since then there has been no stopping be it the technological advancements that it has seen or the immense potential that it has shown in attracting the audiences attention. As Mr. Walt Disney rightly said, Animation offers a medium of storytelling and visual entertainment which can bring pleasure and information to people of all ages everywhere in the world. And that is what makes it such an effective tool for marketers to get consumers attention in the much cluttered world of intense competition. Starting with Mickey Mouse and Snow white in 1935 to Ice Age and Finding Nemo in recent times,
animation has gone over to make significant contribution beyond entertainment. One such field would be content generation for corporates and higher education institutions which are increasingly using elearning for imparting education. Through this cover story we intend to show how this industry has been able to create such a remarkable impact on the people and how it is driving businesses, be it through innovative advertising or through more utility based contribution like content for elearning. We will particularly stick to two important aspects of the marketing mix: the Product where we will focus on how animation helps creating world class movies, cartoons, gaming and custom content development for e-learning and the Promotion where we will primarily focus on its use in advertisements, online marketing and its increasing use in effective B2B marketing. Stick with us as we take you on a tour of Disneyland and the rest of the global world of animation followed by the growing Indian world of animation.
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From Tiny TV to Donald Duck, Mickey Mouse, Japanese Anime to Tron Legacy, Up, Kung Fu Panda, Shrek, The Ice Age etc. the list is a lengthy one. Why do people especially children watch animation? Firstly, most watch it because it is an enjoyable way to spend time. Education is aided by these cartoons; it removes the monotony from learning. Secondly, the fantastical nature further adds a creative angle to the viewership. Lastly, at the end of the day, storytelling entices viewers of all age groups and backgrounds which is rightly being proven by the animated stories. This industry has a lot more in store for us from Amusement Parks to Home Entertainment and from Advertising to Education in our daily lives. It is here to stay and grow! So, say hello to the next sunshine industry- The Animation World.
know today. Movies, theme parks, cartoons, costumes, merchandising, collectibles: Disney's creations are world famous. Disney calls its Engineers as Imagineers and that has clearly reflected in the work they do in this creative space. That has helped Disney grow into a multibillion dollar firm which continues to remain on top 80 years after its most famous creation: The Mickey Mouse.
Pixar,
now a part of
are the
numerous processes by which imagery is created in the studios. The amalgamation of footage shot via camera and computer generated imagery, which creates visuals and creatures of varied forms is now a reality. Scenes which are risky to shoot, can be expensive are recreated by these processes with ease. Computer Generated Imagery(CGI), the implementation of 3D graphics adds special effects to video games and movies. The scenes again can have imagery with a background or even a character. Animation of high quality can be produced at an affordable cost, with simplistic computers. The software required for this is affordable for even the middle rung studios hence improving the quality of films. A world with a simulated environment allows interactions via animated characters known as avatars. Avatars can interact directly with users and hence the emergence of the virtual world. Multiple users can now interact and can form quality work as shown by studios like Pixar, DreamWorks and many more. Walt Disney: The Pioneer Try to imagine a world without Walt Disney. A world without his magic, whim and optimism! Walt Disney transformed the entertainment industry, into what we
Disney, is another major motion media picture studio famous for producing breakthroughs technological and artistic. Toy Story, Finding Nemo, TheIncredibles, Cars are a few among their many creations. This company has given a whole new dimension to creativity where theyve shifted the focus from the initial idea to all the ideas that are generated in the process. Pixars customers want to see something new every time. Where its downright scary, Pixar executives believe that if they arent always scared, theyre not doing their job good. Pixar gives a new dimension to the industry reflecting the value attached to people, their freedom to communicate, safety in offering ideas and close association with innovations in the academic community.
DreamWorks
huge names like Steven Spielberg, Kung Fu Panda, Shrek associated with it. Their artwork focuses on a wider frames and vistas of magnificence. Their animation world is quirky yet likeable, wild yet desirable.
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Chalk and cheese is the similarity quotient of the two giant studios of animation Disney and DreamWorks. Its a world where contrasts can co-exist with quality and entertainment ruling the roost.
Cartoons part
An
inseparable
The technology and business of cartoons and animation certainly has changed in the past 50 years or so. People of a certain age can remember the Saturday morning cartoon action heroes such as Spiderman or Superman among others. They were animated versions of comic books. For a number of years the cartoon and animation content consisted primarily of reruns of these old shows. It was almost until 1990 before the cartoon and animation industry was revitalized primarily through the efforts of the Disney Studios. The growing popularity of cable and satellite television helped expand the market further. Stations such as Nickelodeon and Disneys television channel made cartoons that featured funny and unique characters. Even mainstream networks got involved creating cartoons such as The Simpsons that appealed to a larger audience. Ultimately animation acted as a revenue generating machine.
The Indian gaming industry is growing fast, just behind China which is the fastest growing country in this segment. Rising internet penetration is turning the fortune of online gaming. Indian companies are now moving up the value chain, involvement is rising to endto-end development and releasing. Indigenous developers who now develop games from the scratch are coming up, all thanks to the high quality affordable software tools. Zynga, the developer of Farmville, Cityville and Mafia Wars is now present in India. You may not like receiving requests to play the game but the industry is booming thanks to such games.
Content Development:
Custom content development refers to the development of material catering to Corporates, Higher Education etc. With 59% of the revenue of Indian animation industry coming from the custom content development and an estimated CAGR of 24%, it has quite some uses in the Indian businesses. The content here is animated by choice, so as to make it more effective and easy to understand for users. Most common applications include: 1. Training for corporates Shifting from the traditional classroom training to the more efficient online training modules not only helps employees manage time properly, but also allow centralized tracking of performance. 2. Primary and secondary education Taking education to rural India and delivering it in an effective understandable way is a challenge which can be achieved through quality content development.
Game-On:
From the 1952 launch of the TicTacToe, to Atari Expansion of the 70's to Pacman, gaming now is transformed thanks to Nintendo. The Xbox and the playstation adorn the hands of children and adults alike.The Global Gaming industry, rendered through PC, Mobile, Console or Online, is poised to reach 59 billion dollar by 2013 and has been steadily growing at a rate of almost 10%. Needless to say, a major driver of this industry is animation with its lively characters and interactive graphics. VFX and advanced 3D character animation techniques have made this a reality.
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3. Higher Educational Institutes With the growing trend of distance education programs, this is another sector which is also catering to content development delivered online or in CDs/DVDs. 4. Industries such as Defence, Aviation: Animated content is used for their training requirements of employees which help explaining technicalities of the complex devices easier.
counterparts, as we get better access to the latest developments and technological advancements in the field. The huge talent pool Bollywood boasts of can be used to set the cash box ringing. Original content is a booming market, from characters like Bal Hanuman to Krishna making a foray into the animation space. While preserving the culture, these stories go a long way in revenue generation too. The catch here is the foreign audience is not attracted to such work. Rana the warrior, played by Rajnikanth, cannot be missed as an example, Mind It!! Studios and the artists have grown in confidence and quality over the years. While earning respect worldwide for the quality of the work, India should aspire for a Pixar type culture. The passion for great work is building up. With stories well told there is enough reason to be animated about the future. 3-D mobile gaming is making waves already, a good enough reason to be animated about the growth.
Use in Promotions
Animation has the ability to add the fun quotient to anything it touches and that makes it an indispensable tool for promotions.
Advertising:
Advertising is one domain where Indian as well as multinational firms are increasingly turning to animation for creating a more long lasting impact on their consumers. Laudable examples include: 1. Characters endorsing Brands: Simpoo Singh is oh-sovibrant character. Etched in the minds of adults, a simpleton at heart and comical to the core he can tickle your funny bone.The show stopper though is a simple girl ruling the hearts of housewives and kids alike- the Amul Girl. From raising social awareness to taking jibes at the corrupt, she does it all. The girl has given an identity to Amul which helps improve its brand recall value by customers.
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2. Ads which use the animation power to sell products: One can almost relate to the plight of the Cocoa deemed unfit to be a Bourneville. The real world is not as accommodating as the virtual one. The ad effectively uses humor in depicting its value proposition of using pure cocoa. The cherubic Pillsbury doughboy holds you to go through the complete advertisement, which itself is an achievement since the invention of the Television remote. It is the simplicity with which these ads are made using animation which attract the audience and give an additional reason for people to be associated with the brand.
Online marketing
Google has symbolized innovation like very few brands could do successfully. Use of animation forms an inseparable part of this journey of innovation, be it the many Google Doodles or their many product releases. With the growing use of internet and social media for mass communication, animation is playing an important role here as well: 1. E-mails Animation is an important tool to hold the attention of a user with limited time and space available in an email. With whole lot of emails cluttering the users inbox, this is not an easy task. Well designed animated gifs makes this possible. Though India is yet to master this art, foreign firms like Pottery Barn, Williams-Sonoma: Breville Pie Marker have already started leveraging them for sharing product information in emails. 2. Website Animation also helps designing websites creatively in a way that it holds visitors and provides relevant information. For ecommerce websites like Amazon where this is the only place where buyer evaluated products, well designed website becomes a priority. 3. Animated videos on the web With animation being so dear to kids, youth and grownups alike, well designed animated videos offer a very good prospect for triggering viral marketing. If you have seen and been sharing the large number of
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animated videos on break ups and relationships, employee-boss jokes, spoofs on politicians and so on then you would know exactly what we are talking about! Oh! We so wish we could have attached an animation gif or a video here to give you a feel but alas few are still to realize the power of animation!
B2B marketing
Another area where animation assists in selling is in B2B marketing. Top level executives and CEOs prefer animated content in their presentations over those tiresome mundane PowerPoints and excels. Such vibrant presentations add an x-factor to the presenter and in turn to the company and helps better communication of the product offerings which ultimately helps in sales. But why at all should it matter? After all its strictly business. That is why it matters. Pictures are preferred over words. Flash can do it better, make it more effective and garner more business.
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Vartalaap
Mr. Sachin Gupta is the Associate Dean for Academic Affairs, Johnson Cornell University and Professor of Marketing at the Johnson Graduate School of Management. After having done his B.A. (Honours) Economics, from St. Stephen's College, Delhi University, and MBA from Indian Institute of Management, Ahmedabad, he went on to do his Ph.D. in Management from the Cornell University. His research focuses on the areas of Analytical modeling of marketing phenomena, discrete consumer behaviour models, marketing mix and channel relationships. Having won many awards for teaching excellence, he shares with us his journey so far and valuable inputs on FMCG, Pharma and Hospitality industries.
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Vartalaap
markathon |may 2012 Mr.Sachin: Traditionally we have measured advertising effects using measures at the top of the hierarchy-ofeffects, namely, attitudinal changes. Examples are advertising awareness, brand awareness, brand perceptions, purchase intentions, and so forth. These measures are still very relevant in the context of new products. However, increasingly it is becoming possible to relate advertising to measures at the bottom of the hierarchy-of-effects, namely, consumer behavior such as click-through or purchase. In the internet
Markathon: What motivated you to get back to teaching after the successful stints with two biggies in the Indian FMCG space? Mr.Sachin: While I enjoyed the work I was doing at Cadburys as a Product Manager in Bombay in the mid1980s, I was looking for bigger intellectual challenges. I had also been teaching part-time in the MBA program at Sydenham College and found that experience rewarding. So I decided to apply to Ph.D. programs in the US since an academic career seemed attractive, although, to be honest, I did not know too much about what a Ph.D. or an academic career really entailed! Looking back, it was absolutely the right decision, because I do really like being an academic. Markathon: From a student to an executive, from professor to Dean and the long list of awards that accompanied. What is the secret behind such exceptional performance? I am sure it will go a long way in motivating us in our career paths. Mr.Sachin: I dont think there is much of a secret. Basically, I aim for excellence and work very hard. I also had the benefit of growing up in a family where academic achievement was encouraged and cherished, and so it became second nature to strive to do well. Also, I have had the privilege of working with outstanding students, teachers, colleagues and mentors in every institution I have been associated with. Markathon: In this world of uncertainty, even though the popularity of an advertisement can be judged but its return to revenues is still questionable. How is measurement of returns on marketing investments done in such a scenario?
In the internet environment this is possible relatively easily. Consider metrics like click-through rate, or conversion rate, for display or search advertising. However, even in non-Internet environments this is becoming possible.
environment this is possible relatively easily. Consider metrics like clickthrough rate, or conversion rate, for display or search advertising. However, even in non-Internet environments this is becoming possible. Detailed purchasing data available from large marketing research panels of companies like AC Nielsen, combined with advertising data, can be analyzed using sophisticated analytical models to arrive at good measures of returns
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Vartalaap
to advertising expenditures. In the prescription drug context, I and my co-author have examined the effects of direct-to-consumer advertising on patient visits to physicians and on patient requests for specific drugs. Of course, many challenges remain. One such challenge is the fact that advertising has long-term effects, and models often capture these effects insufficiently. Markathon: Your paper on customer satisfaction in the restaurant industry won the Cornell Hospitality Quarterly's best paper award. What are the important metrics which are used for measuring customer satisfaction in this industry? How is data driven marketing relevant in this context? Mr.Sachin: This industry typically uses survey-based measures of customer attitudes. Increasingly there is interest in tying such measures to more direct measures of business-performance, such as revisit rates, sales, and profits. In the paper you mention, my co-authors and I attempted to combine rich data from customer surveys with restaurant level performance data (daily sales, average check size, customer traffic, and so forth), to measure how customer satisfaction flows through to business performance. Our paper showed that there are statistically significant effects of customer satisfaction on customer repurchase intentions as well as on restaurant sales. I believe there is considerable room to do more such work in this industry. Markathon: Comparing drug industry where marketing is restricted to product experts like doctors to the consumer goods industry where it is more targeted towards the end user who is influenced by many other factors over need, how is marketing different in these two sectors? Mr.Sachin: There are huge differences, as you note. An important difference is that in the prescription pharmaceutical industry, the purchase decision maker is the physician, the consumer is the patient, and the payer is typically a third party like an insurance company or the government (Medicare or Medicaid in the US). By contrast, in consumer goods markets the consumer makes the purchase decision, pays for the product, and consumes the product. The multiplicity of decision makers in the pharmaceutical market implies
considerably higher complexity in the marketing function. It also implies that the marketing budget is allocated across the different decision makers. For instance, pharmaceutical firms spend a large fraction on their marketing budget on influencing physicians, but increasingly spend marketing resources on influencing patients as well. It is clear that patients now play an active role in their own diagnosis and treatment, and firms recognize this. Markathon: Having worked with renowned FMCG firms like Cadbury and ITC, you have built an expertise in consumer goods segment. What do you think are few of the biggest challenges that FMCG firms will face in future in lieu of the growing competition? What will be the key to differentiation at such times? Mr.Sachin: There are a few important challenges. The media landscape is changing rapidly. Consumer goods companies have to learn how consumers use the new media and have to develop innovative ways of interacting with consumers. This is key to acquiring new customers and developing brand loyalty and a profitable long-term relationship. Brands that do this well will win in this environment. A second challenge relates to the distribution channel. In the US the equilibrium in the competition between on-line retailers such as Amazon and others such as Target, WalMart and Best Buy is still being figured out. Consumer goods manufacturers need to think about this question strategically and lay their bets. Firms that make the right strategic decisions here will find themselves ahead in the long-run. Markathon: What would be your advice to our young readers who aim to become successful marketers? Mr.Sachin: I would say a couple of things. One is that with the pressure for accountability, marketing is increasingly becoming a data-driven and analytical field. To be successful you need to make fact-based and well reasoned decisions. So prepare yourself for this by taking the right courses in school. Second, the field is changing rapidly, so keep up with the business press and the latest developments.
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Without the glamour, that match would still have been the same interesting!
RCB needing 21 runs to win in the penultimate over, with only a few expecting the miracle to occur, the fans witnessed a RCB victory with 3 massive sixesfew shots out of the cricketing book. Without the glamour, that match would still have been the same interesting! Four IPL seasons have passed by and clearly only people with right technique and cricketing brains have survived & succeeded in this format, in spite of the complex bidding process. IPL being held for close to 2 months, people curse it for the increasing no. of matches, injury risks for the players or young talent falling for money very early in their career. Yet, be it people who return from offices, house wives or the children - all are glued to IPL on the TV indicating growing fame for IPL and the game itself. Ultimately, this format has proven to groom cricketing brains and bring local talent into lime light. Without a doubt, the quality of the game and fitness levels of players has only improved since its inception making it a tough job for the selectors! Be it the glamour quotient , celebrity gimmicks or the late-night party hungamas, people still love Sachins cover drives, Gangulys precision square cuts, Dhonis helicopter sixes, Malingas deadly yorkers and Morkels unplayable bouncers more than anything else! At the end of the day, cricket is the winner.
Pradeeba K S IIM S
commercialization strategy. The auction of players has created a greater hype than the game itself. Telecasting of the auctions live embarrasses the players who remain unsold during auctions. It demeans their entire cricketing career. When the IPL season arrives companies come up with new advertisements and marketing strategies to encash on the craze. Being a tournament to encourage local cricket talent, IPL proved to be more of a controversy than encouraging cricket. Each franchisee has a target for its revenues and not for cricketing achievement. Cricket was one of the USP of IPL when it was inaugurated in 2008 but in its 5th season now Bollywood and advertising have replaced it. Moreover, IPL has now become the playground for manufacturers of all sorts of products from FMCG to luxury goods to find its consumers. About 54% of revenues from broadcasting rights go to the franchisees which are used for stadium fees, sales and marketing, employee costs, players and support staff payments, team promotion, travel and hospitality costs. Each of the franchisee priced their tickets over a range of Rs.300 to Rs.55,000. The amount spent on cricket as such is just one-tenth of the revenues from advertising which proves that IPL no more leverages on cricket.
Topic for the next issues Eye to Eye: Bollywood has moved beyond romance: Maturity with growing awareness or just a marketing gimmick to attract audience? Your opinion (view/counterview) is invited. Word limit is 250-300. Last date of sending entries is 18th May 2012. Include your picture (JPEG format) with the entry. 20
Silent Voice
LAST MONTHS RESULTS
Theme : IPL 5
WINNER : RAHUL SINGH | FMS, DELHI Congratulations!!! Rahul receives a cash prize of Rs 500!
HONORARY MENTION
NEXT THEME FOR SILENT VOICE: Piaggio's Vespa returns to India LAST DATE OF SENDING THE PRINT AD: 18thMay, 2012 EMAIL ID: markathon.iims@gmail.com Send your entry in JPEG format named as SilentVoice_<Your Name>_<Institute>only.
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specials | ADdicted
Ad-dicted
Umang Kulshrestha, GSN Aditya| iim s PRODUCT #1: Britannia Vita Marie TARGET AUDIENCE: Women (Health conscious and employed) POSITIONING: Heart Friendly AD AGENCY: Lowe Lintas
CONCEPT: The TVC opens with a beautiful, vibrant girl with that typical, as needed, just the right curls in her hair adorning a white kurti. She then picks from her childhood how her grand-mother always told her that whatever she does she needs to do it whole heartedly. She grows up and now finds her Boss telling her that she did not dedicate her heart and soul to the task. The girl is into photography and now decides that this time her Boss would get the job as per his requirements i.e. job would be done wholeheartedly Chalo to lagate hain Dil! She shoots little kids playing and enjoying, she talks of various aspects in which this heart is touched by some and broken by some, how this heart cries at times, laughs at times whereas is dead scared and palpitates at times! She gestures shying away commenting on her Naazuk Dil which needs to be taken care of. This care would come from the healthy Vita Marie Biscuits containing heart friendly Oats and honey. PRODUCT #2: Canon PowerShot TARGET AUDIENCE: Youth between the age group of 18-30 years POSITIONING: A easy-to-use digital camera for the AD AGENCY: Dentsu India CONCEPT: Todays youth like to take a picture of anything and everything. This is the crux of this vibrant fast paced ad. The Ad is essentially a sequence of photographs, each depicting an alphabet. The TVC begins with A- for Anushka Sharma and progresses through the alphabet set by showing a different picture for each alphabet within a span of 60 seconds. Each picture depicts a unique mood and is set in different situations. The barrage of photographs ends with a stunning Anushka Sharma teasing you with Basically, essentially, importantly, fundamentally, everything makes us click and thats what makes us click, now you know what makes us click so we will have to shoot you!! VERDICT: Catch The TVC is very simple and screams out one simple message Everything in life deserves to be captured on photograph, and PowerShot makes this easier. The TVC signifies the repositioning of the PowerShot sub-brand and Anushka Sharma fits the bill perfectly. Thankfully the Ad does not waste time focusing on the camera or on Anushka Sharma who is dazzling by the way. The TVC is very vibrant and entertaining. It is very catchy and scores high on brand recall value. The viewer invariably ends up watching it over and over again to figure out how each alphabet translates into a photograph. Each photograph is very well shot and does not stick to the clichd way of depicting alphabets. I particularly liked the way the alphabets P, Q and Y were depicted. The TVC in general has a certain air of energy and humour to it leaving the viewer intrigued each time he watches it. The Ad is so fast paced and each scene blends into the other so well that it makes me think that if Guy Ritchie were an Indian Ad film director; this is how he wouldve shot an Ad: Chaotic, yet entertaining with ample humour.
VERDICT: Catch
The TVC has a very swift movement from the growth of a young child into an adult, remembering and practicing the preaching of her grandparents finally evolving into lessons for her life. It brings out the importance of how the heart - a very Vital organ of our body (I guess renders Vita) is associated with every big or small task that we do in our life and so how crucial it is for us to take care of our Naazuk Dil. The commercial then comes to the relation of heart and the ingredients of the product i.e. Oats which is very healthy for heart along with honey added to the biscuits. The concept of the ad certainly brings out a strong connect to the emotional, cultural, social, professional and health aspect of an individuals life.
Link:
http://www.youtube.com/watch?v=fd2yh66FN dA
Link:
http://www.youtube.com/watch?v=PULuVgwuyqg& feature=related 23
specials | bookmark
All Marketers are Liars: The power of telling authentic stories in a low- trust world; Seth Godin
Review by SOWMYA R Penguin Group (USA)
One look at the cover of this book, and you feel intrigued enough to pick it. Seth Godin charms you throughout the book making even the word liar seem more a compliment than an accusation. The book starts with 3 lines, which essentially are its pillars: Organization: The best part of the book is that you can read it from anywhere- start at the top and follow the order, or just pick random parts to read. Whatever you choose to do, it still makes sense! The first part of the book, aptly titled Highlights summarizes and sets the pace for the reader. The next part Got Marketing elucidates the changing face of marketing, before, during and after the Golden age of Television. Steps 1 to 4 of the book talk about different worldviews, and the art of telling stories that have not already been told by competitors. The author states that first impressions only start the story; the rest of it has to be built from time to time. The book illustrates the customers constant lookout for change and something new with the example of a frog, which can catch the tiniest movement of a fly but does not notice a dozen dead flies around it! Step 5 talks about the power of authenticity and how a good story that is not authentic, is worse than no story at all! The book ends with two bonus parts which discuss master story tellers, and purple cow a product of experience so remarkable, that people feel compelled to talk about it. As Godin rightly says, the cow is yet to leave the building and every marketer can turn it into his/her purple cow! Verdict: 4.5/5 The book is a page turner. A must read for every marketer and more so for non - marketers! I give it 4.5, for the sheer pleasure of reading it and the enchanting journey it takes its readers through. Bottom-line: At the end of the day, the book sells because you tell yourself a story when you read or hear about it. Through its name, the cover with the Pinocchio-nosed guy and the style in which it has been written, it reinforces the authenticity of that story. Grab the book, and treat yourself to some great lies, oops stories!
Tell your story to people who are inclined to believe it. Marketing is powerful. Use it wisely. Live the lie. Filled with examples of successful marketers whose stories continue to live on, here is an intricate web of delightful and astonishing facts. Summary: There are no small stories, only small marketers. True enough, the book explores a myriad of stories, big and small that have created ripples, caused revolutions and touched lives through their sheer authenticity. The book does not speak of marketers as manipulators or customers as fools. Rather it shows that customers are wise enough to see through the lies, all they ask for is to be authentic and live that lie. It distinguishes wants from needs. A good story makes you want to buy something; if you need something there is no requirement for a story! The book segments customers according to their worldview and asks a marketer to identify and cater to that worldview that best suits his wares. The product is just a medium, the place and price enablers and the promotion a strategy. Godin says what really sells is the story.
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BRAND LAUNCH
Kwality walls new Ice cream brand Fruttare
The concept of giving 100% fruit in juices has been further extended to ice creams, where Kwality walls has come up with the first of its kind ice cream bar made up of real fruit juice and pulp. The company aims at targeting the health conscious youth who prefer icy refreshments. The name Fruttare provided a lingo Fruit he re which is used as a catchy proposition in their campaign. The company came up with teaser campaigns which instigated curiosity about what is fruit he re without revealing the product category initially. Now the teaser has come as a full fledged TVC with its launch date.
has launched the product in Big Bazar, Mega Mall Mumbai. The breakthrough product is the outcome of advanced research at LOreal laboratories.
BRAND WATCH
Facebook acquires Instagram over a $ 1 billion acquisition
The photo sharing app maker which did not have any substantial source of revenue, just one and a half year old and with only 13 employees on roll, might not have had any proposition of such high cash returns or a stock acquisition worth $1 billion, but Mr. Mark Zuckerberg sees the potential and has envisioned developing the best experience of sharing beautiful mobile photos with people of interest. The popular Instagram application has made 30 million users since its launch in January 2011. Facebook wants to build Instagram independent of its social network which will give an option to the users to share their photos on other social media platforms.
Marico to sell 4.56% stake to two foreign investors To fund the acquisition of Paras
personal care business from Reckitt Benckiser, Marico is going to sell 4.56% stake for Rs. 500 crore. Reckitt had acquired both personal care and pharmaceutical business of Paras in April 2011. The acquisition will enhance the product brand
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portfolio which covers the famous Parachute coconut oil, Kaya Skincare services, Saffola Oats and wheat floor. Maricos move of diluting the promoters share will help it maintain the debt equity ratio to acceptable limits and help the company in future growth through the inorganic route.
A media campaign is successful if it is able to increase companys sales. Theoretically it looks very simple but which part of the wide marketing communication efforts has contributed how much is a task near to impossible. Adobe has tried to measure ROI of social media campaigns by showcasing its credibility as service provider in the field of marketing with Adobe social analytics. The social analytics tool tracks the activity on social media platforms and if you sell something on the site, it can connect the activity to the sales.
to
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female
Camera makers such as Nikon, Fujifilm, Canon and Sony are trying to woo female customers in a male dominated market. Companies are banking on Bollywood actresses in order to reposition the camera category for the youth. Deepika Padukone for Sonys cybershot range, Priyanka Chopra for Nikons Coolpix range, Minissha Lamba for Fujifilms hero range of products and the recent replacement of Sachin Tendulkar with Anushka Sharma as the brand ambassador of Canon points to the companies shifted focus towards female customer base. The large range of attractive colours goes in line to lure the target age group of 18 to 25 years.
MEDIA
Adobe aims to measure true social media ROI
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in 2009 in an attempt to run a Hindi general entertainment channel but has unfortunately failed in doing so.
AD Watch
Oreos special emotional connect TVC
Kids have always been someone who adds to the sweetness quotient of an advertisement. And relevant or not, such advertisements are liked by all. In the current Oreo advertisement a small female child acts in the role of a housewife serving food in the form of Oreo to her dad. The ad highlights the delicacy of Oreo by eating it in a particular way where the girl licks the cream and then dips it in the milk and then eats it. http://www.youtube.com/watch?v=YfFlaavmqSU