MxMIndia

Category: MARKETING

  • Customers in India & China would pay 10 per cent more for socially and responsible brands, says report

    Havas Media launches Meaningful Brands study

    By A Correspondent

     

    Havas Media has come out with findings of its research that suggests that 20 per cent of brands have a notable positive impact on our sense of well-being and quality of life. Some of the findings also suggest that majority of consumers are willing to pay 10 per cent more for socially and environmentally responsible goods in India and China and 95 per cent and 85 per cent say they trust companies with a responsible or social profile more than those without in China and India respectively.

     

    This is the fourth yearly study done by Havas Media, which started initially with a study on sustainability and has evolved further to studying Meaningful Brands.

     

    What is intriguing is that for the second year running, Havas Media found that most people would not care if 70 per cent of the brands ceased to exist. Further, it argues, that the existing approaches to building and measuring brand value are out of date. As a direct response, Havas Media has launched ‘Meaningful Brands’, a global framework that offers a new index, analysis and proprietary tools to measure and build brand value in the context of today’s demanding environment.

     

    This innovative global undertaking that covers India and China in Asia Pacific enables, for the first time, to connect brands with our quality of life and well-being. It does this by measuring the perceived impact of brands on our personal wellbeing – their influence on factors such as our health, fitness, happiness, values, social relationships, financial security, lifestyles and habits – and our collective well-being, that is, how brands help to improve communities, societies and the environment.

     

    Speaking to MxMIndia, Vishnu Mohan, CEO of Havas Media Asia Pacific, said: “The findings suggest that the brands in the emerging markets like Asia have a much more positive impact and score higher on trust as compared to western market. It would have been believed that vice versa would be true but this study shows that the future of brands is higher in emerging markets like India. My interpretation is that valued brands are those that have values too. Hence those brands that are considered meaningful also have been performing well on the stock index.”

     

    The research was carried out from March to June 2011 across 14 markets – France, Spain, UK, Germany, Italy, USA, Mexico, Brazil, Colombia, Chile, Argentina, China, Japan and India. The research took into account the views of 50,000 consumers via online panels. Mr Mohan explained that the plan is to include more markets and consumers to make it more robust.

     

    The findings of Meaningful Brands analysis are especially relevant for marketers in Asia. It clearly shows the seriousness with which consumers in Asia look at the social, ethical and environmental aspects of a brand. As a region, which is growing at a rapid pace, the findings provide us a huge opportunity to create the context that promotes the growth of meaningful brands. Companies and brands operating in our region can play a big role in transforming the lives of millions of people and contribute to the progress of their societies.

     

    Some of the key consumer trends in China and India include:

     

    • 74 per cent and 62 per cent say they would pay 10 per cent more for socially and environmentally responsible goods in China and India (highest globally, aside from Chile).
    • Information and expense are the main barriers to socially responsible consumption, with credibility being another key issue in both markets.
    • 84 per cent in China feel it’s the responsibility of companies rather than the government to solve social and environmental issues (compared with 64 per cent in 2009) and 76 per cent in India, with a similar increase, since 2009.
    • 95 per cent and 85 per cent say they trust companies with a responsible or social profile more than those without in China and India respectively.
    • Empowerment is down in China: 64 per cent feel that they can make a difference to how companies behave and this is static in India at 71 per cent.
    • But so is cynicism: 71 per cent feel that most companies are only trying to be responsible to improve their image and only 12 per cent trust what companies say in this area.

     

    The analysis suggests that the next generation of brands will come from emerging economies. People in fast growing economies, such as Asian and Latin American markets, record a stronger and healthier relationship with brands. The proportion of brands making a notable positive contribution to our lives increases to around 57 per cent in China, 30 per cent in Latin America, compared to 8 per cent in

     

    European markets, where people tend to be more skeptical and less engaged with brands. In the US, it’s 5 per cent. By contrast, the situation in developed economies is the opposite. Brands in these regions are no longer seen to improve people’s quality of life.

     

    Meaningful Brands helps us to develop this type of relationship by understanding exactly what people expect from brands. It also helps us track how successful companies are responding to these needs by understanding how these companies are contributing to our wellbeing, both as citizens and individuals, and how they communicate these values to us. It also shows us that there’s a big business opportunity for brands which are able to satisfy consumers by creating wellbeing in the context of their new values, expectations and local market realities.

     

  • Meru is testing specialized services like Meru Select, aimed at its regular users and Meru Corporate, aimed at corporate customers

    Now Meru to offer special services to key customers

    By Preethi Chamikutty

     

    From zero to 5,600 radio taxis in under five years, with a presence in four metros to boot, has helped Meru Cabs become the largest such service in the country. With Rs300 crore in revenue, Meru has raced ahead of competitors like Easy Cabs and Mega Cabs, with the company even claiming that it is the third largest radio taxi operator in the world. The sauce of this success is no rocket science, at least on paper: a clean car, a knowledgeable driver, non-negotiable fares and a tamperproof meter.

     

    “You provide these things to the customer and he will be happy,” said Gavin D’abreo, who heads marketing & sales for Meru. This, of course, is just the beginning, and as Rajesh Puri, CEO, pointed out: “This industry is still at a nascent stage and there is a lot of upfront investment that needs to be done. Technology has been a major investment for us to improve our service offerings.”

     

    So what next for Meru, now that it has established a sound base in Mumbai, Delhi, Hyderabad and Bengaluru? Well for starters, turning profitable is the priority, with Mr Puri expecting to be in black in three out of four cities at the end of the quarter ending March. Beyond that, identifying new revenue streams by offering specialized services is the way to scale up operations.

     

    Meru, which has partnered with the airports in the cities it operates in, is now testing out a service called Meru Select in Hyderabad. This is aimed at giving its regular users a guarantee of up to 80 per cent of getting a Meru cab when they book for one. The trigger for Meru Select: only 5 per cent of its customer base gives Meru about 60 per cent of its revenues.

     

    “Because of limited inventory, customers have complained to us about the non-availability of cabs when they order for one. We work on first come, first serve basis, but our loyal customers get an additional assurance of getting a cab with Meru Select,” explained Mr D’abreo.

     

    Meru Corporate, aimed at corporate customers who want more than a service from point A to point B as being offered by Meru currently, is another service being tested. Meru Corporate is targeted at executives who have to travel from one meeting to another across the city in a day.

     

    A preloaded plastic card will be given to the eligible executive, which will be swiped by the Meru driver at the end of day’s travel. Some 21 companies have so far expressed interest in this service and Meru is in the process of giving the finishing touches. Other services being planned are transporting kids in absence of their parents as well as a service for medical emergencies.

     

    Also on cards are expansions into Chennai, Kolkata, Ahmedabad and Vizag. However, such growth won’t come easy. One reason for that are restrictions – fares, distances and licences are regulated by the government. Another hindrance in growth, according to Mr Puri, is finding drivers. And then there’s competition. Mega Cabs, the oldest brand in the radio taxi business, is present in seven cities. Then there’s Easy Cabs -present in four cities – which are available at malls, hotels and even hospitals. Niche services like For She, an exclusive ladies taxi service driven by lady chauffeurs in three cities, are also available.

     

    Yet, there are brands – like Gold Cabs and Star Taxi – that have not been able to survive the tough regulatory environment and the investments that need to be pumped into not just vehicles but the technology back end. Meru estimates the size of the radio taxi business in India at 9,500 cabs across Mumbai, Delhi, Bengaluru & Hyderabad, which is growing at 50-60 per cent per annum. Nabankur Gupta, founder, Nobby Brand Architects, a brand consultancy, reckons the radio taxi space has tremendous scope for brand building.

     

    “What exists today is commodity service with a name; a brand can be built only if customers come back to a brand for the experience they get. Security and assurance of good service will help build stronger brands in this space,” said Mr Gupta. He suggested having two levels of service offerings – one level is a limousine kind of service, which is about exclusivity and pampering; the second level is the existing sedans that can cater to the mass market. Mr Puri of Meru agrees there is a demand for super premium service in India, but the constraints are not just restricted to acquisition of vehicles. “To have differentiated cabs, there has to be a differentiated pricing system and a backend IT infrastructure to support it. Technology is the most important aspect of our business.”

     

    He adds that evidence of Meru’s tech edge is that its drives can do “six duties a day compared to 2-3 duties of others. Our backend alerts them about the next job nearest to where they are positioned,” explained Mr Puri.

     

    Mr Gupta says in countries like Singapore and Hong Kong radio taxis have made a big difference and have also replaced the public taxi fleet. “Black & yellow taxi drivers should be spoken to and, if they can be taken over, we will have a much better taxi service in our cities,” he suggested.

     

    Source:The Economic Times
    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved

  • Gadgetsguru.com, affiliating with Brand Capital, has come up with print ads, TVCs and is soon coming out with online and radio ads

    Gadgetsguru gets hyperactive, launches brand campaign

    By Archita Wagle

     

    An eye-catching full page ad in the Times of India on Monday morning spoke of “Demo kahin bhi lijiye, shopping gadgetsguru.com par hi kijiye”.

     

    Asked why the big bang route, Arun Kapoor, CEO-gadgetsguru.com said: “This is purely a branding ad. We are trying to increase our brand awareness.”

     

    Mr Kapoor goes in depth about the strategy adopted, explaining the reason for coming up with an ad just now: “There is a lot of competition from other online portals. Every other portal will offer you Cash-on-Delivery, 30 days warranty and other sops. So we created a whole new funda. Instead of competing with the online industry, we decided to take the offline industry (the retailers and the wholesalers).”

     

    While offering branded products to the customers, the online portals lose out due to the fact that the customer doesn’t get a demo of the products he may want to buy. Even when a person goes to buy an expensive item from a shop, s/he will  go to 10 different shops to find out about the best deal they can get. “A person buying products online can’t get a feel for the product he wants to buy. So we are telling him/her that they can go to a shop to get a demo of the product they have their eye on; but they should buy it from us as we give them the best deal they can get,” Mr Kapoor explained.

     

    Gadgetsguru.com was founded by Mr Kapoor in 2004. The website and the backend support was developed in-house. When asked about what was the reason for coming up with such ads now, Mr Kapoor said: “When we started in 2004, the first few years were not so great. The first year saw sales of just Rs1.25 lakhs. It didn’t make sense at that time to give out such full page ads. Now that we have established ourselves, we decided to increase our brand awareness. Also we have recently been affiliated with Brand Capital, Bennett Coleman & Co. Ltd’s offering (earlier called ‘private treaties’. We have got a budget of Rs30 crore for the next three years thanks to the tie-up. So we decided to for it now.”

     

    [youtube width=”400″ height=”200″]http://www.youtube.com/watch?v=-b5JSmWtvnc[/youtube]

    Gadgetsguru.com is not just coming out with print ads, but have also launched TVCs which take a tongue-in-cheek look at “bahanas” that consumers give to avoid buying a product after they take a demo at the shop. The TVCs show a boy running out to avoid buying a tablet by telling the salesman that he is allergic to tablets; a man refusing to buy a refrigerator because the door faces south instead of east; and a woman running out of the shop on the pretext of testing the zoom on a digital camera. The voice-over at the end tells us “Demo kahin bhi lijiye, shopping gadgetsguru.com par hi kijiye. Faayda aap hi ka hai.”

     

    The TVCs were launched recently when the promos for the Zee Cine Awards  started to be aired. Gadgetsguru.com is the associate sponsor for Zee Cine Awards.

     

    In fact, Mr Kapoor promises that radio and online ads will be launched in the next 15 days. When asked about what they would be talking about, Mr Kapoor refused to say anything.

     

    Not only that, gadgetsguru.com has launched a campaign on Facebook which promises the person coming up with the best bahana a chance to win a BlackBerry.

     

    The creative mandate for gadgetsguru.com’s ad campaign has been handled by   Manoj Motiani, Founder & Chief Creative Officer of Thought Bubbles. Mr Motiani was formerly a creative director with O&M. “We decided to give the creative mandate to Thought Bubbles as Manoj Motiani is a good friend,” explained Mr Kapoor.

     

    Gadgetsguru.com is on a roll. After launching a branding campaign, they are now looking at providing services in countries such as Singapore, Malayasia, UAE andcUK. “We will be starting our services in Hong Kong,DubaiandSingaporein the next three months. We are looking at tie-ups with the major market players who have a reputation of expertise in electronics market. We will create a sub domain for that particular country so that people in that country and surrounding areas can buy from there. We have been getting a lot of orders from South-east Asian countries,” said Mr Kapoor.

     

     

  • After wowing the world, TBWA brings Integer to India with its Shopper Marketing solutions

    Betting big on shopper insights

     

    By Johnson Napier

     

    At a time when brands – led by their able marketing chieftans – are still grappling with the insight and consumers are still clueless about the experience that the discipline offers, it is turning out to be an opportune time for agencies making a beeline in building their expertise around the rather unexplored phenomenon of Shopper Marketing.

     

    The initiative, which is being pursued with hot interest by agencies to offer their services, has found a new and able beneficiary in Integer Group, one of the world’s largest promotional, retail, and shopper marketing agencies.

     

    A group company of TBWA (an Omnicom Group agency), Integer enters India with Mumbai as its hub and the sixth such market for the group in Asia Pacific. It has already blazed ahead with its offerings in other established markets like the US, Australia, Europe, the Middle East, and North and South America.

     

    Commenting on the launch of the property in India, Shiv Sethuraman, CEO, TBWA India said: “Integer is going to be an important part of our strategy and is one of the fastest growing units within the marketing communications mix. We are very happy to be investing in the division early enough than most others.”

     

    On the choice of India as the next market for launching the division, Dan Paris, Regional Managing Director – APAC, Integer said: “India, as a market, is accelerating fast and retail as a major driver is picking up drastically in India. From our POV, we wanted to launch at the right time and with the right assets and people. We thought the most important thing to do would be to invest in a serious study and the findings have revealed that this is an opportune time to be launching in this country.”

     

    Integer’s shopper marketing expertise utilizes extensive global research data on shopper behaviour, retail insights, and unique tools to develop strategic marketing solutions for clients interested in engaging and motivating shoppers. In India, the unit would be headed by Sreejit Nair, MD, Integer who comes to the agency after having worked for FMCG majors like PepsiCo and P&G. Sharing his vision and how Integer would work in the Indian context, Mr Nair said: “Coming from the client side of the business, I know what retailers go through. Especially modern retailers, who are struggling with basic issues like ensuring fill rates, getting space at a fairly good rental, and so on, but what’s happening is that they have actually become obsessed with price. Shopper marketing gives a lot of opportunity for them to differentiate. If you go to the client with an effective plan, I am sure modern retailers would accept this practice.”

     

    According to Mr Nair, the issue with brands is that they get obsessed with themselves; they don’t want to see what’s there for the retailer and the shopper. “If I am going to talk only about my brand, then it is like trying to push something to the retailer and that won’t work. And even if it works, it won’t succeed,” he affirms.

     

    Sharing the agency’s core focus in India, Mr Paris affirmed that it would be around four verticals, namely promotional marketing, shopper marketing, channel marketing and digital. “As per reports, retail is estimated to grow to 6 per cent until 2016. Given that there is no slowdown being witnessed here and the fact that India delivered an average 3.9 per cent growth in retail, we expect a modest growth in this segment,” said Mr Paris.

     

    “Also, the growth will be led largely by digital as the number of consumers who use online and mobile for research and shopping has gone up dramatically. Our study indicates that more than 60 per cent of the online consumers do research, comparisons and shop online and through mobile and this is quite a high figure. With e-commerce expected to grow by 3 per cent and with more than 123 million mobile payment users expected by 2012, these are exciting times for players to be in retail in India and around the world,” he added.

     

    When quizzed on how Integer India would be different from what the other players in the space have to offer, Mr Nair said: “We would differentiate from the others through our insights. What’s happening is that everybody wants something sexy in retail and it starts and stops with that. We don’t want to be in that particular pool of agencies; we want to start with insights, focus on a lot of inputs on understanding the shopper first and tailoring solutions around his need. We don’t want to be seen as someone who makes flashy collaterals for retailers.”

     

    Adding on, he said: “Personally, I believe that there is a lot of opportunity in traditional trade – that is an area that needs to be tapped. How much do companies know about traditional trade shopper? Hardly anything. That’s where the opportunity lies for us.”

     

    Sharing a similar sentiment, Mr Sethuraman added: “I don’t think there is a clear understanding of what shopper marketing is actually about. Most people confuse it with BTL, activations and other such initiatives. The challenge for all agencies offering this service is to get the meaning behind this term well defined, get marketers to believe in this property and treat it as a proper discipline and not just another version of doing BTL. Having said that, I think there is room for all the players to grow healthily for a long time to come; it is still a very nascent category.”

     

    Prior to launching the service in India, Integer India had undertaken an extensive study across India to map the shopping behaviour of consumers. Titled Check Out India, the study was designed to understand motivations and attitudes, rituals, and factors that influence shopping. The study was conducted across three geographical segments -Urban A – metro with a population of more than 1 million, Urban B – cities with population of less than a million and Rural India. The respondents included male and female shoppers in the age group of 18 to 55. The study threw up interesting findings around the frequency, priority and communication as seen by urban and rural shoppers. Going forward, the objective would be to keep conducting the study twice a year and present it to the marketers for deeper understanding into the mindset of the consumer.

     

    As for its initial client list on board, Mr Nair said: “Right now we are just working on some projects with PepsiCo and P&G, but we don’t intend to go all out with this unit. We have just launched this study and will have to see how we could present the study in a relevant manner to the clients. I must mention that this is a category neutral study; we’ll have to go on a category level and find about more about the shopper relevant to that category so as to make it really relevant to a particular marketer. We are currently pitching to a few brands and should be able to make an announcement in 2-3 months time.”

     

    On the growth that Integer is expecting from India, Mr Sethuraman said: “It is still a nascent market and we can easily look at a growth of 60-70 per cent in year one itself. But while a percentage growth may sound impressive, we have to say that the base is still small. The bigger task is to get clients to get used to this novel idea called shopper marketing and make it a genuine part of the communication mix.”

     

  • Realising the extensive scope that the discipline of marketing research could offer to its patrons in India, decade-old full service market research company Majestic MRSS has announced its foray into the country recently.

    Market research firm Majestic MRSS opens shop in India

    By A Correspondent

     

    Realising the extensive scope that the discipline of marketing research could offer to its patrons in India, decade-old full service market research company Majestic MRSS has announced its foray into the country recently. The new venture seeks to capitalize on technologies around insights developed by Majestic MRSS and its partners in the US, Europe and Japan.

     

    In India, the venture will be headed by Sarang Panchal who comes in as Chief Mentor and Principal advisor. Mr Panchal has more than two decades of experience in Market Research and has worked in P&G prior to his career with D&B, VNU and Nielsen.

     

    On his responsibilities at the company, Mr Panchal said, “My primary role here would be to mentor the leadership team that we are putting in place. My extensive experience that I have gained in the field of research marketing would enable me to guide marketers on what will work for them and what to avoid. We expect the full team to be in place by the end of the month.”

     

    Outlining the objectives of the company, Mr Panchal said “Our aim at MRSS in India would be to further leverage the use of technology to offer better and customized services. We will continue adding more innovative and strategic technologies as we become one of the leading players in India. We are pioneers in getting technology in the Asia-Pacific region, and are now ready to introduce them to India.”

     

    Raj Sharma, Co-founder and President of Majestic MRSS said, “We believe Mr Panchal’s extensive knowledge around research, associations and active presence in the industry will bring instant recognition to MRSS India as a brand with global technological leadership and hyper-local understanding.”

     

    When asked on how MRSS would differentiate from the other players in the space, Mr Panchal said, “We have leveraged technology in the field of market research in the areas of data collection and advertising / media research. Moreover we are ‘known’ for our high quality work in researching upscale and ‘difficult to contact’ target groups. This is what sets us apart.”

     

    Adding further he said, “Currently MR agencies are considered to be data suppliers. We hope to change this perception and become partners of clients and enable them to grow their business in India and Asia Pacific. The industry may not change in perception unless larger players begin to offer truly-world class research in marketing and that is what we would excel to provide.”

     

    Going forward, the goal for the company would be “to become the largest independent MR agency by the end of the decade,” affirmed Mr Panchal. Given the huge void of players in the space, it isn’t an impossible proposition, he feels.

     

  • A Coca-Cola spokesman confirmed the company is introducing Citra in "a few towns in Maharashtra and Gujarat" on a pilot basis

    Eye on volumes, Coca-Cola to revive Citra after 19 years

    By Ratna Bhushan

     

    Coca-Cola will revive Citra, a clear-lime drink it bought from Ramesh Chauhan two decades ago but junked in favour of Sprite, in a move that analysts believe is more to target price-sensitive consumer segments than to unlock the brand’s heritage value.

     

    A person familiar with the top beverages maker’s plans said Citra will be priced about 20 per cent cheaper than existing lime-lemon drinks such as its own brands Sprite and Limca as well as PepsiCo’s Mountain Dew and 7 Up, to target a wider audience and take on smaller brands.

     

    A Coca-Cola spokesman confirmed the company is introducing Citra in “a few towns in Maharashtra and Gujarat” on a pilot basis. This will be followed by a staggered launch across other metros and bigger cities.

     

    The move has surprised industry watchers because Coca-Cola’s Sprite, the second-largest soft drink brand in the country after Thums Up, leads the lime-lemon drinks segment, which is the fastest-growing soft drink category in India’s Rs13,000-crore fizzy drinks market.

     

    Among those surprised is Ramesh Chauhan, who created brand Citra and made it popular in the late 1980s and early 1990s.

     

    “After keeping the brand in cold storage for so many years, it’s strange they want to re-introduce it now, especially when they have a strong presence in the clear-lime segment,” Chauhan said. “If they are looking for retention and heritage value, then logically even Gold Spot should be revived.”

     

    When Coca-Cola re-entered India in 1993, it bought out all Parle brands except Bisleri from Chauhan.

     

    Move aimed at mopping up volumes

    While Citra and Gold Spot were phased out to make way for Coca-Cola’s global brands Sprite and Fanta, respectively, Thums Up, Limca and Maaza were retained. Shashi Kalathil, CEO of management advisory firm Y-factor and partner at private equity fund Exponentia Capital, said the move may be aimed at mopping up volumes. “Coca-Cola probably doesn’t want Citra’s pricing to impact its larger brands. So this could be more of a pricing game and about treating Citra more as a trademark than a brand,” he said.

     

    Parle brand again

    It’s history that the US major sidelined Parle’s cola brand Thums Up to promote its own brand Coca-Cola for years before waking up to the potential of the Indian brand and backing it.

     

    Now it seems like deja vu for Coca-Cola as it is banking on a Parle brand once again to push market share in the lime segment. The Coca-Cola spokesman said Citra would not cannibalise its existing lemon drinks because there is ample room for multiple brands in a developing segment like sparkling fizzy drink in a high-potential market such as India.

     

    Devendra Chawla, president of food & FMCG segments at the country’s largest retailer Future Group, said the move will aid the growth of the clear-lime category, which is already seeing heightened brand activity. “To grow carbonated soft drinks’ per capita in India, apart from growing colas, it’s critical to activate flavours which have natural acceptance from Indian consumers such as lime and mango,” said Chawla, who formerly worked with Coca-Cola.

     

    India’s per capita consumption of carbonated drinks is just 11 litres a year compared to 34 litres in China and 675 litres in Mexico.

     

    The lime-lemon category in India has been growing 16-17 per cent a year, ahead of colas at about 11-12 per cent and orange drinks at 8-9 per cent. Apart from being a familiar flavour that Indians consume at home (in the form of nimbu paani), lime-lemon drinks are considered ideal thirst quenchers.

     

    Both Coca-Cola and PepsiCo have been promoting their brands aggressively in this segment. PepsiCo has Bollywood star Salman Khan endorsing Mountain Dew and actor Sharman Joshi for 7 Up, while Coca-Cola pushes clear-lime drink Sprite and cloudy lemon drink Limca on the irreverent and freshness platforms, respectively.

     

    Source:The Economic Times

    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved

  • Little wonder, the Feb 1-14 period accounts for 16-18 per cent of the company's annual turnover

    Love sees a new high for Archies on V-Day

     

    By Tuhina Anand

     

    Valentine’s Day celebrations in India would be incomplete without that ubiquitous Archies card declaring undying love and probably most, when at the store, one adds some gifts too from a wide selection of red and pink love tokens. So there is no room for doubt when the company declared that Valentine’s month, as it considers the period from February 1-14, accounts for 16-18 per cent of their annual turnover.

     

    “We have seen that 3-4 days before V-Day, the sales across our stores increase from anything between 6-10 times as compared to an average day. In fact, a day before (Feb 13), the stores witness chaos and we have to arrange for all the helping hands available to cater to this rush in many of our company-operated stores,” informed Youhan Aria, Head Corporate Communications at Archies.

     

    In the last few years, Valentine’s Day has become a money spinner for businesses of all sorts. While few years back, this day was restricted to college-goers or youngsters, now the craze has engulfed many across the cross-section. Mutalik and Shiv Sena notwithstanding, the day is being celebrated and the phenomenon has caught on so much that even if one might not go for a high priced gift, a greeting card or maybe flowers and chocolates do figure on the gifting list.

     

    Aria shares the example of a beat constable in Vasant Vihar in New Delhi, who did not understand the concept behind V-Day, but still walked in one of the Archies store to pick up a card. That speaks volumes on the V-Day equation and the formula of gifting.

     

    For Archies, V-Day is bigger than any other gifting occasion which sees spikes in sales, be it Diwali, Friendship Day or Rakhi. Across its 240 stores in 66 cities, the display, too, is done keeping in mind the spirit of the day where red and pink rules.

     

    In terms of top picks for gifting are the usual cards, soft toys, chocolates and fashion jewellery. Also, it seems, when splurging on V-Day, money is not much of a concern and people go for cards that are high on embellishments – higher the number of inserts, better it is. Also there are not too many takers for lesser-priced cards

     

    “Over the years, the change that we have seen on the V-Day gifting is that our TG has expanded.Whereas, earlier it was restricted to only teens and young professionals, now one sees people even in their late 40s coming over to pick something. Seeing this trend, we have expanded our portfolio of gifts to cater to a wider range for different TGs,” said Mr Aria.

     

    Also one thing that Archies has seen over the years is that sales come more easily from tier II and III cities as the number of options available in these towns are limited. Mr Aria added: “For us, competition comes from anyone, be it a coffee joint or a retail store. In fact, even laptops, jewellery brands and shops as well as restaurants are competing with us. I would call these category killers. However, an Archies store is a social expression as it fulfills its customer’s gifting needs. Even gifting a gadget is never complete on V-Day without the greeting cards, and that’s where we step in.”

     

    Archies has seen exponential growth in the demand for their merchandise and cards on V-Day in the last few years and have been extremely satisfied with the sales during this period. While the country celebrates V-Day on February 14, for Archies, their season for this celebration has almost ended and they now start analyzing the sales and trends and get ready to celebrate the day of love for the next year. In fact work for the next year’s V-Day design of cards, based on the feedback they get every year, begins in the month of April itself.

     

  • By 2020, consumption will reach $3.6 trillion, as new generation hits its prime spending years, according to a recent CII-BCG report

    Rejoice! Consumer spending in India poised for explosive growth, says CII-BCG report

    By A Correspondent

     

    The Boston Consulting Group (BCG) and The Confederation of Indian Industry (CII) jointly released a study titled The Tiger Roars: An In-Depth Analysis of How A Billion-Plus People Consume. “This report examines the shape and size of the consumption expenditure of India , and its expected evolution over the next decade, in detail. While India’s robust consumption growth presents attractive opportunities for companies, its unique diversity and variety makes it a challenge to capture these opportunities. This report presents a framework and approach on how to de-average the opportunity to better segment consumers and effectively understand their buying preferences,” said Abheek Singhi, Leader of the Consumer & Retail Practices, BCG India and co-author of the report.

     

    Buoyed by the rising household income, coming-of-age of a new generation, and other socio-economic forces, overall consumer spending in India is likely to expand 3.6 times-from $991 billion in 2010 to $3.6 trillion by 2020. The projected 14 per cent growth rate is much faster than the anticipated annual global growth of 5.5 per cent-and even faster than the anticipated growth of 9 per cent in emerging economies. By 2020, India will constitute 5.8 per cent of global consumption – more than double the 2.7 per cent it now represents.

     

    Despite the current global economic environment, India continues to march along a robust growth path. With the recent regulatory changes, increasing consumption levels and changing consumer preferences, the FMCG and retail sectors are standing at the point of inflexion,” said Amitabh Mall, Partner & Director, BCG India .

     

    India has billion-plus consumers spanning all income segments. The income pyramid is real but does only a partial job of explaining consumer attitude and behaviour. This report provides a definitive view of the income segmentation and more importantly uses other parameters of location, education and occupation to define the seven segments in India :

    • Professional Affluent (2 per cent of households)
    • Traditional Affluent (4 per cent of households)
    • Urban Aspirers (8 per cent of households)
    • Rural Aspirers (6 per cent of households)
    • Large Town Next Billion (6 per cent of households)
    • SmallTownand Rural Next Billion (24 per cent of households)
    • Strugglers (50 per cent of households)

     

    Food, housing & consumer durables and transport & communication are expected to be the Top 3 categories, accounting for 65 per cent of consumption in 2020. The Professional Affluents are expected to dominate consumption in 2020, accounting for 26 per cent of total consumption expenditure, up from 16 per cent in 2010. By contrast, spending by struggler households will decline from 26 per cent in 2010 to 11 per cent in 2020.

     

    “The roar of the Tiger is a fitting metaphor for consumer spending in India . Consumer spending in India will continue to roar, but the companies that try to capture it may not be so fortunate. India is a big and growing consumer market, but not an easy one. Understanding the size and shape of the prize and where it is hidden in the challenging fabric of India are the first steps to capturing it,” concluded Mr Singhi.

     

  • The ongoing discussions centered around a potential joint venture but the final agreement will depend on whether India moves ahead with plans for foreign direct investment (FDI) in multi-brand retail

    French retailer Auchan eyes jv with Landmark group

    By Samidha Sharma & Boby Kurian

     

    French retail giant Auchan, touted as Wal-Mart’s most aggressive global rival, has held talks with Micky Jagtiani’s Landmark Group for a possible India entry.

     

    The ongoing discussions centered around a potential joint venture but the final agreement will depend on whether India moves ahead with plans for foreign direct investment (FDI) in multi-brand retail, said at least two people familiar with the talks.

     

    Auchan, the second largest French grocer after Carrefour, is fully owned by one of the wealthiest French families- the Mulliez- who also own sporting goods chain, Decathlon. Auchan has been a fast mover in emerging markets like China and Russia, where it has performed better than global peers Wal-Mart, Tesco and Carrefour. The big-box retailer Auchan, with a special focus on developing hypermarkets, had last reported turnover of over $70 billion.

     

    “The discussions with Auchan are in an advanced stage and a decision is likely to take place in a month’s time,” said a person in direct knowledge of the development. The stores which will come up in India, if the agreement is signed between the two groups, may operate with the Auchan brand name although, the finer details are still to be etched out.

     

    India decided to suspend plans to allow 51 per cent FDI in multi-brand retail in December following a lack of political consensus, but could revive it after the crucial elections to state assemblies next month.

     

    Landmark may forge a franchise agreement with the French retailer till the FDI norms are relaxed in multi-brand retail, said one of the sources mentioned earlier. Landmark Group currently runs the Dutch retail chain Spar in India through a licencing agreement signed in 2007 which comes to an end in December this year.

     

    The Spar MD Gordon Campbell who was in India last month had said they were open to engaging with other partners to expand more aggressively here. Spar has 10 stores in India currently.

     

    Sources close to the development said that Mr Campbell’s statements to the media did not go down well with Max Hypermarkets, a part of the Dubai-based Landmark Group, and the partnership with Spar is virtually over.

     

    A detailed email sent to Groupe Auchan remained unanswered while a company spokesperson for the Landmark Group was unavailable for comment.

    The Croix, France based- Groupe Auchan SA, operates 581 hypermarkets and 2,384 supermarkets and minimarkets as per the company’s 2010 annual report. “We are clear-sighted – the outlook is more positive in emerging countries than in the Euro zone where the crisis is not yet over and continues to strongly depress consumer spending. 2011, our 50th year, will see the number of hypermarkets worldwide break through the 600 mark. We also plan to continue developing franchise and partnership agreements,” said Vianney Mulliez, chairman of the board of directors, Groupe Auchan in the annual report.

     

    In China, Sun Art Retail group, a joint venture between Groupe Auchan SA and Taiwan based-Ruentex Group, successfully raised $1 billion in a Hong Kong Initial Public Offering last year, the proceeds of which will go in its expansion.

     

    Sun Art operates 197 hypermarkets across mainland China under two brand names, Auchan and RT-Mart. The other big market for Auchan is Russia where it has around 50 hypermarkets.

     

    The $70 billion Auchan has told Landmark Group’s Max Hypermarket that it would prefer a JV if India allows multi-brand retail FDI.

     

    Source:The Economic Times

    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved

  • He will replace Elkana Ezekiel, who is said to be joining Ahmedabad-based Zydus Wellness as managing director

    Rahul Saighal is new Samsung CMO

    By Mahima Puri

     

    Samsung India has appointed Rahul Saighal as its new chief marketing officer. He will replace Elkana Ezekiel, who is said to be joining Ahmedabad-based Zydus Wellness as managing director.

     

    Prior to this, Mr Saighal held the same position at the telecom company Aircel, which he joined in October 2007. Prior to that, he worked with Unilever for almost two-and-a-half years, starting August 2005, as regional brand director in Thailand.

     

    An economics graduate from St Stephen’s College, Delhi, Mr Saighal pursued his MBA in marketing from IIM Calcutta. His experience in the telecom industry could prove useful for Samsung, which is establishing itself as a key player in the smart phones and tablets category in the Indian market.

     

    Mr Ezekiel had joined the Korean consumer & electronics major in January 2011, prior to which, he was with Johnson & Johnson as regional franchise director for Asia Pacific. He held this position for about five years from April 2007, before which he spent 13 years in the organsation in various marketing roles.

     

    A Samsung spokesperson confirmed the development, while Zydus Wellness refused comment.

     

    Source:The Economic Times

    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved

     

  • The new design stays with the traditional team colours of purple and gold, but incorporates a striking new logo unit, created by Lambie-Nairn

    KKR announces new marketing campaign

    By A Correspondent

     

    The Kolkata Knight Riders [KKR] on Monday announced the launch of their new marketing campaign, “New Dawn, New Knights.” At the centre of the campaign is the unveiling of a new and refreshed logo. The new design stays with the traditional team colours of purple and gold, but incorporates a striking new logo unit. Created by leading global branding agency, Lambie-Nairn, the new identity is modern, vibrant and unique.

     

    Team owner Shahrukh Khan said: “The new team we put together last year made us proud with its refreshing approach, winning attitude and professionalism they brought to KKR. Add to that our new coach and players this year, I am excited about the upcoming season and our new campaign, New Dawn, New Knights.”

     

    The KKR CEO, Venky Mysore said: “We have been fortunate that the KKR brand has become the leading brand in the IPL. We are working very hard to add value to our sponsors, grow our fan base and build a profitable business. I am confident that our new logo and our new campaign will help us achieve our objectives.”

     

    “The KKR identity had a lot of equity but it was not designed for use across the wide range of platforms that are used today. We wanted to retain the existing heraldic imagery and purple and gold colours, as these features differentiate the team from the competitors and ensure they are instantly recognizable. However, we needed to refine the logo and ensure that it would work across every touch point, from the screen to merchandising” added Sophie Lutman, Creative Director at Lambie ­Nairn.

     

    The new look has been polled out across a wide range of applications, including the team kit, online, social media applications and merchandising.

     

    The Knight Riders represent the city of Kolkata in the Indian Premier League. KKR is one of the most trusted Sports brands in the country. The team is owned by Shahrukh Khan, Juhi Chawla and Jay Mehta and headed by CEO and managing Director, Venky Mysore.

     

    The Knight Riders are led by Gautam Gambhir and the squad includes some of the finest players in international cricket like Jacques Kallis, Brett Lee, Yusuf Pathan and Manoj Tiwary.

     

    For the last thirty years, Lambie-Nairn has been pioneers in the world of branding and identity. They have launched some of the biggest brands in the world, winning awards and redefining genres along the way.

     

  • The Indian brands today are doing what the Korean brands did when they entered India way back in late 90s, mapping their rivals' strengths and weaknesses

    Korean durable brands outwit Indian giants

    By Rajiv Banerjee & Ravi Balakrishnan

     

    There’s frenetic activity inside the corporate office of a leading consumer durable brand. As the financial year hurtles to an end, the head of marketing is racing against time, tying up operational plans for the 12 months of the new fiscal. This involves meetings with the board and also key dealers to keep the network abreast of the gameplan.

     

    The excitement among the marketing team at the consumer durable maker is palpable, and not just because of the strategy being crafted. 2012-13 may well be the year in which, after a long time, Indian consumer electronics and white goods makers stand more than just a fighting chance of taking on their more successful Korean rivals.

     

    “When the Korean brands were behaving like Indian companies, they were doing very well. The minute control moved out of this country to Korea, it’s all changing,” says the marketing head, who wishes to remain anonymous.

     

    This change in the Rs35,000 crore durables and electronics segment in India – where possibly after more than a decade, the incumbents (the Koreans) seem vulnerable – is not lost on rival brands. Specifically, the indigenous brands like Onida, Godrej, Voltas and Videocon, which once ruled the roost but were thrown off the perch as Korean brands LG and Samsung caught the Indian consumer’s imagination and her share of wallet.

     

    Today, according to market estimates, Samsung and LG together have a dominant combined share of 34 per cent in ACs, 45 per cent in refrigerators and an equal combined share in washing machines (semi-automatic category). But in the ACs, from the period January-December 2011, Samsung’s market share fell from 19 per cent to 11 per cent.

     

    Similarly, LG slid from 28 per cent to 23 per cent, but Voltas jumped from 12 per cent to around 17 per cent in the same time frame. In the CTVs segment, Videocon is running almost neck to neck with leader of the pack LG with Samsung in the third position. And the year ahead may well be comeback time for the domestic camp.

     

    Sure, the growth rate for the industry dipped to 8-9 per cent against the projected 14-15 per cent in 2011. But that’s not fazing the Indian warhorses, a few of whom are blueprinting big-bang entries into new categories. Godrej Appliances, which has a presence across categories like refrigerators, washing machines, air conditioners and microwave ovens, is running pilot projects in small geographies in the area of consumer electronics, according to Kamal Nandi, VP, sales & marketing, Godrej Appliances. Those in the industry aware of the developments indicate that Godrej is giving colour televisions a serious thought although Nandi refuses to elaborate on the nature of the pilot project.

     

    Similarly Voltas, say rivals who are aware of the matter, is readying for a more aggressive play in air conditioners (ACs) to close the gap with LG; this after overtaking rivals like Samsung and Carrier. “In the last 3 to 4 years, one can see the comeback of Indian brands both at the shelf level, as well as in the minds of the consumer. Brands like Videocon and Godrej have gone through major identity revamps. Accurate positioning or not, but it has certainly brought back the buzz for them in the home appliances domain,” says Deba Ghoshal, head of marketing at Voltas.

     

    In many ways, the Indian brands today are doing what the Korean brands did when they entered India way back in late 90s. The Koreans mapped the strength and weaknesses of each Indian player across categories and then went about eating into the share of established brands like BPL and Onida in colour TVs, and Godrej and Videocon in appliances. Sensing that they were no match for the product strength of the Korean brands, the Indians manufacturers changed their strategy.

     

    “They tactically withdrew from categories where they thought that they will not be able to match the product strengths of their Korean counterparts. However, they did not let go of their core competencies. Instead of spreading themselves too thin, they maintained focus on their main categories,” says a senior marketing professional from one of the Indian consumer durable brands.

     

    A brand like Onida resorted to re-branding in an attempt to project a more youthful image, and in the process moving away from its iconic ‘Devil’ (Neighbours’ envy, Owners’ pride) advertising.

     

    “I wouldn’t say the campaigns from the last couple of years were path-breaking but we want to be a little unconventional to appeal to young nesters, which is our defined target group,” says Anand Ramadurai, head of marketing at Onida.

     

    Over the years, to withstand the Korean onslaught, brands like Onida decided to focus on regions and consolidate the space there. “In markets like Mumbai, we are relatively weak since the cost of doing business is very high. But the south is a strong market across categories, as is Gujarat, and the north is strong in air conditioners,” explained Mr Ramadurai.

     

    Other marketers chose their areas of comfort and protected that turf. For instance, Videocon maintained a strong presence in consumer electronics – its market share according to estimates in CTVs stands at 26 per cent. Godrej focused sharply on the direct cool refrigerator category (overall in refrigerators, Godrej stands at 15 per cent). And Voltas consolidated its presence in ACs with a market share of around 17 per cent at the end of 2011. “In many sub-categories, Indian brands have successfully protected their turf, and lead the market,” observed Mr Ghoshal of Voltas.

     

    At the same time the focus of the Korean brands is getting diffused somewhat as they get more serious about mobiles and tech products. For Indian manufacturers, it’s an opportunity to go in for the kill. Sure enough, Onida, Videocon and Voltas are pushing further into home appliances and ACs.

     

    Apart from stable pricing and better dealer margins, where Indian brands are trying to emulate the Koreans is faster go-to-market. Implementation, the players realise, is the key to instilling confidence in the trade that the companies mean business.

     

    “We are trying to break into the MBOs (multi-brand outlet) in Mumbai as well and are present in Vijay Sales and Reliance Digital where we were not there at all a month or two ago,” said Mr Ramadurai. “The recent campaign from us has certainly brought in the numbers, both from brand volumes as well as from a market share perspective,” added Mr Ghoshal.

     

    However, there are challenges ahead for Indian players. Nabankur Gupta, founder of Nobby Brand Architects who has worked with Videocon and Philips in the past, says Indian business houses, by typically chasing volumes, run the risk of entering the zone of commoditisation. They neglect the fact that many of the lower-volume, higher-end products add value – not just to the bottom line – but to the brand’s image.

     

    The Koreans and Japanese brands, says Mr Gupta, still rule in the premium, innovation- led space across categories. His take on the Indian brands is as follows: Videocon has regained number one position as a consumer durables group but not as a brand. Onida has totally lost out on appliances.

     

    “They are concentrating on TV and have held their own in terms of volumes but there’s very little innovation. It’s an also-ran brand. They still go on basis of old loyalties and pricing and a lot of dealer push,” reckons Mr Gupta. Mr Ramadurai of Onida counters that Onida is definitely not a price warrior. “What we do is launch products that are innovative in some manner. Being an Indian company, our insights are seen to be better.”

     

    Another area of concern for the Indian brands, market observers feel, is the lack of investment in technology; where Koreans and the Japanese brands have proved to be miles ahead.

     

    “In the conventional products like CRT TVs, Indian brands may stake a claim with an advantage on cost. But MNC brands have been able to invest in technology across smart TVs, LEDs, home theatres and mobile. Without investment in tech and manufacturing, Indian brands cannot dominate the market,” said Vijay Narayanan, head of marketing at Havells and formerly with Korean brand, LG.

     

    Finally, if Indian brands are to make their very own great leap forward, brandbuilding has to become a year-long pan-India affair rather than sporadic bursts around the festive season. According to Mr Ramadurai, Indian companies that are listed on the stock exchange cannot splurge on communications as they are accountable to shareholders. The cost of high spends that don’t quite show up on the bottom line and on margins can wreak havoc on the stock price.

     

    “Most multinationals in durables are not listed here and so can afford to make losses and make it up someplace else. Haier was extremely aggressive year before last and Toshiba was a year ago. They come and go in cycles but we can’t do that,” shrugs Mr Ramadurai.

     

    One option is a greater reliance on the more cost-effective digital media. It’s an area that Onida confesses to just starting to get its feet wet. It’s currently evaluating options of e-tailing and harnessing its presence on social media.

     

    Rebranding, pushing the trade and distribution may allow the Indian players to narrow the gap with rival Koreans. But there’s one camp that is slowly but surely making its presence felt as well – the Japanese. Even if Indian brands are successful in dethroning the Korean brands, rest assured the Japanese will be snapping at their heels.

     

    Source:The Economic Times

    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved