MxMIndia

Tag: Aditya Birla Group

  • … and get us humming that famous Aamir Khan song from his film Qayamat Se Qayamat Tak – Papa Kehte Hain Bada Naam Karega, Beta Humaara Aisa Kaam karega. Magar yeh toh koi na jaane, kee meri manzil hai kahaan.

    Birla Sun Life-Big FM get together to help kids live their real passion in radio

    By A Correspondent

     

    As Children’s Day draws closer, almost every media brand manager (and his uncle and aunt) dreams up something to target kids. Tokenism of this nature is commonplace. Even MxMIndia does it 🙂

     

    But sometimes brands  come up with winner ideas. Like this one from the Aditya Birla group’s Birla Sun Life Insurance which has got us humming that famous Aamir Khan song from his 1988 film Qayamat Se Qayamat Tak – Papa Kehte Hain Bada Naam Karega, Beta Humaara Aisa Kaam karega. And as it continues: Magar yeh toh koi na jaane, kee meri manzil hai kahaan.

     

    Birla Sun Life Insurance (BSLI) has established a ‘Not Just Jobs But Passion’ initiative and as part of this, Children’s Day 2013 will see Reliance Broadcast’s part-retro radio network 92.7 Big FM being run by children.

     

    The initiative aims to  generate conversations between parents and kids to identify the child’s real passion and helps support the child financially and emotionally in this endeavour. Talented kids with real passion in various aspects of radio programming will be given holistic hands-on training on the running of a radio station. Children will take charge of operating all aspects of Big FM’s radio station in Mumbai, Delhi, Kolkata and Chennai

     

    Ajay Kakar

    Commenting on this initiative Ajay Kakar, Chief Marketing Officer, Financial Services – Aditya Birla Group said, “Today, children are exposed to a variety of options that tempt them to independently explore their interests. Not every child finds their real passion right away. Identifying and cultivating real passion needs parental support and encouragement. Parents are undoubtedly a child’s biggest cheerleader and passion partner. To further this quest in search of real passion, on the occasion of Children’s Day, in partnership with Big FM we offer a unique opportunity to interact, train and learn from experts who run the radio station.”

     

     

    Ashwin Padmanabhan

    Said Ashwin Padmanabhan, Business Head, 92.7 Big FM, “As an initiative that’s fresh and exciting, ‘Birla Sun Life Insurance Not Jobs But Passion’ endeavours to encourage parents to introduce little ones to an art that might one day become their strength and vocation. This is another initiative that lives on our tagline Suno Sunao, Life Banao. We thank Birla Sun Life Insurance for coming on board as our partners.”

     

  • Retail chains post double-digit sales growth in FY13, despite slowdown

    Slowdown doesn’t slow down growth for retail chains in FY13

    By Sagar Malviya

     

    India’s organised retail sector may have turned a corner in the year ended March, having managed to reduce losses while substantially increasing sales with a focus on costs by pruning poorly performing locations and resorting to more efficient supply management.

     

    Big unlisted retail chains such as Reliance Fresh of Reliance Industries, Aditya Birla Group’s More, Bharti Retail’s Easyday and Tata-owned Star Bazaar all posted double-digit sales growth, reflecting their increasing popularity among shoppers despite economic growth slumping to a 10-year low and consumer price inflation not easing appreciably.

     

    According to financial statements for 2012-13 filed with the corporate affairs ministry, the food and grocery retailers listed above saw their combined losses shrink to Rs 1,176 crore from Rs 1,277 crore in the previous year, while combined sales jumped 34 per cent to Rs 8,770 crore. Excluding Bharti Retail, which was in expansion mode, the sector cut the loss figure by about half. While Bharti Retail’s losses swelled 37 per cent to Rs 538 crore, all other conglomerate-owned supermarket chains reduced losses as they shut unviable stores and focused on supply chain efficiencies.

     

    “Our focus has been on profitable growth, which has resulted in reducing the operating losses by more than 30 per cent,” said Pranab Barua, business director, apparel and retail business, Aditya Birla Group. “Performance management at all touch points of the business has been a key driver, giving us a revenue growth as well as improvement in the bottom line.”

     

    In the last two years, most retailers have been closing, relocating or rationalising unprofitable stores after they found themselves saddled with mountains of inventory and gripped by a cash crunch following hasty expansion. “These retailers have reached their maturity with many stores opened during initial expansion, (they) are now six-seven years old. At the same time, there has been more focus on profitability and employee management per square foot apart from better inventory planning unlike the carnage we saw last year when retailers had to sell stocks at a huge discount,” said Kumar Rajagopalan, chief executive of the Retailers Association of India trade lobby.

     

    The numbers bear witness to this shift. Despite not opening a single store last year, Trent Hypermarket recorded a 21 per cent increase in total revenue to Rs 801 crore last fiscal and a loss of Rs 72 crore. Aditya Birla Retail added just three hypermarkets and two supermarkets under the More brand and posted a 10 per cent sales growth with a 5 per cent decline in losses as it shut over a dozen unviable stores. The numbers also indicate that despite, or perhaps because, of the economic gloom, Indian shoppers have embraced the value proposition offered by organised retail.

     

    “Modern trade has surely taken a share from unorganised retail due to a sharper proposition in terms of cost and quality. For a consumer, a full basket at modern trade works out cheaper compared to traditional trade and obviously more savings,” said Abheek Singhi, partner and director, The Boston Consulting Group, India (BCG).

     

    Bharti Retail’s losses widened as it opened more than 30 Easyday supermarkets and hypermarkets in calendar 2012, taking its tally to 210 stores. The sharpest decline in losses was posted by Reliance Retail, down 80 per cent to Rs 55 crore while sales jumped 36 per cent to Rs 5,256 crore.

     

    To be sure, the issues that make organised retail a high-investment, low-return sector are still unresolved, according to experts. These include the high cost of real estate, a paucity of skilled manpower and the lack of infrastructure such as cold storages and efficient supply chains. “Retailers are looking at profitable and moderate pace of additions under 10 per cent in FY14 against the range of 15-30 per cent seen in the last two-three years,” said Janhavi Prabhu, analyst at India Ratings & Research that has maintained a negative outlook on the retail sector for second half of 2013.

     

    Source:The Economic Times

    Copyright © 2013, Bennett, Coleman & Co. Ltd. All Rights Reserved

    Licensed to republish

     

  • As sales grow for big retail chains, their losses too widen taking them away from the breakeven point

    Losses widen even as sales grows for big retailers

    By Sagar Malviya

     

    Big unlisted retail chains Reliance Industries’ Reliance Fresh, Aditya Birla Group’s More, Bharti Retail’s Easyday and Tata-owned Star Bazaar grew their sales in high double digits, but their losses too widened to take them farther away from the breakeven point.

     

    According to their financial statements for 2011-12 filed with the corporate affairs ministry, these food and grocery retailers increased their combined losses 42% year-on-year to Rs 1,277 crore. Combined sales jumped 55% at Rs 6,560 crore.

     

    “Our losses for FY12 have been impacted due to increased cost of funding and one-time store closure costs,” said Pranab Barua, apparel & retail business head at Aditya Birla Group, whose net loss increased 26%. “Since food and grocery retail is a thin margin business, the right rent-to-revenue ratio is critical for the success of the store and hence the success of the business,” he added.

     

    High costs of real estate, paucity of skilled manpower and the lack of infrastructure like cold storages and efficient supply chains have all contributed to making organised retailing a high-investment, low return sector so far.

     

    A recent report by India Ratings suggests that EBITDA margins for the retail sector are likely to contract by 50-75 basis points in 2013, while overall revenue is likely to grow 3-8% year on year across large retailers.

     

    Experts, however, say that while all big retailers continue to be in the red, their losses as a percentage to sales would reduce going forward. “While few retailers are shutting stores, many are also expanding in profitable places.

     

    Since they now have a critical mass, bargaining power has improved too, which will help in improving gross margins,” said Kumar Rajagopalan, chief executive of Retailers Association of India, an over 1,000-member strong industry body. He said food and grocery retailing takes at least 7-10 years to break-even.

     

    More than five years ago, in the wake of a slowdown when they were on an expansion spree, most retailers were left saddled with a huge inventory, faced cash crunch due to higher working capital requirements and were unable to raise funds. This made most retailers cut costs aggressively. Some deferred expansion and some shut down shops, while all now focus on store-level profitability and supply chain issues.

     

    For instance, one of the key tasks for Rob Cissell, the British CEO of the value retail format of Reliance Retail (RRL) since September 2011, has been growing aggressively by launching new stores and new formats, as well as by building a robust supply chain; and to do all this profitably.

     

    Reliance Fresh losses increased 71% to Rs 274 crore in financial year 2012, while its sales grew 55% at Rs 3,860 crore. “The supply chain cannot be outsourced, it is the heart of the business. We are currently working with 15,000 farmers now but, like Walmart does in China, we want to work with a million farmers,” Mr Cissell said last year in an exclusive interaction.

     

    Aditya Birla Retail’s Barua said the company has started getting positive results. “In the last nine months, our sales have grown in double digits with substantial improvement in store contribution over 2011-12,” he said. Birla Retail shut over three-dozen stores last year to increase productivity and cork losses from unviable stores across the country.

     

    Bharti Retail and Trent Hypermarket widened their losses last year due to aggressive expansion. Bharti Retail, for example, opened 46 Easyday supermarkets and 12 Easyday Hypermarkets during calendar year 2011, taking its tally to 180 stores. While it helped the retailer to grow its sales 117%, its losses jumped 48%. Star Bazaar reported 32% jump in sales and 54% increase in net loss for the year ended March 2012.

     

    Experts say that apart from store expansion, deep discounting too added to the retailers’ losses. “Sales in 2012 were driven by discount offers; and the trend is likely to continue in 2013, providing volume growth at the cost of margin,” said an India Ratings report.

     

    Source:The Economic Times

    Copyright © 2013, Bennett, Coleman & Co. Ltd. All Rights Reserved

     

  • Behind every great commercial is super strategy. Every week, MxMIndia brings you the brief and the strat as given by the client and whatever else that went into creating a winning ad

    AdStrat: Recurring Savings Plan by Birla Sun Life Asset Management Co Ltd

    Deepak Agarwal
    Ajay Kakar

    Lead Credits: Deepak Agarwal, Executive Creative Director, M&C Saatchi; Ajay Kakar, Chief Marketing Officer – Financial Services, Aditya Birla Group

     

    Name of the Campaign: Recurring Savings Plan (RSP) by Birla Sun Life Asset Management Co. Ltd.

     

    Brief:

    Saving via a Mutual Fund v/s other ways of saving!

     

    Everyone knows that it is important to save their earnings – but people go about saving in the manner that they are most used to. Very few people choose to evaluate newer methods of saving, other than the traditional avenues. It is not surprising, therefore, to see as low as 5 per cent of all people opting for a Mutual Fund as a means of saving.

     

    Since its introduction, the option of saving in a Mutual Fund has also been perceived as a riskier method of saving, because of the propagation of information about Mutual Funds. Namely, that Mutual Funds invest in the equity/ share market and that this market can be volatile – hence mutual funds are risky. But the other half of the story is that there are options in mutual fund that can cater to a variety of saving needs, with similar safety and flexibility as traditional avenues.

     

    Among those who are used to saving in other ways, there is also a growing sense of disappointment with traditional avenues of saving – as the rising price of fuel and other aspects of inflation eat away at everyone’s savings.

     

    Research insights: 

    A vast majority of Indians have grown up with traditional avenues of saving (bank accounts, post office etc …)

    A vast majority of Indians are not financially savvy about modern ways of saving (mutual funds, stock market etc …)

    The investors who choose avenues other than the traditional ones target for ‘increasing their income’ as opposed to ‘planning their savings’

     

    The thought process behind the creative:

    The campaign objective: Remind and inspire people with the knowledge of how to save their earnings, regularly and more smartly, via a “Recurring Savings Plan” – a regular savings method in select mutual fund schemes that offer relative safety when it comes to your hard earned money.

     

    The campaign idea: The secret to saving smarter lies in your childhood stories!

     

    As children, we have all heard fables and learnt the difference between right and wrong from their morals. The brand plays the role of a provocateur, reminding adults of the moral behind the fable of ‘The Crow & The Pitcher’ – that doing something different, regularly can actually help one to reach one’s goals.

     

    The message that the brand conveys, via its TVC, is that as adults we often use fables and morals to remind our children to approach issues in their lives in a smarter manner … but the second and more powerful message is to also remind adults to approach their savings habits in a similar, smarter manner.

     

    This creative route leverages the space that fables occupy in everyone’s life, as the morals behind fables are deep rooted and unquestionable. Additionally, morals always seek to educate the reader with valuable life learnings. Hence, the creative route uses a fable to open the minds of adults – in order to plant the thought that perhaps it is these very fables and morals that can also guide us when it comes to saving our money.

     

    Media vehicles chosen:

    The campaign uses a mix of online and mainline (TV, Print, OOH) media to bring alive ‘The Crow & The Pitcher’ fable – in order to inspire adults to try a smarter way to save regularly.

     

    The campaign is supported by a website www.recurringsavings.in where the audience can also play a game that replicates the actions behind the moral of ‘doing something regularly to reach your goal.’

     

    Does the treatment do justice to the brief?
    Commenting on the film, Ajay Kakar, Chief Marketing Officer – Financial Services, Aditya Birla Group said: “In a country that has deep rooted belief in savings and resultantly the highest savings rate (35 per cent of GDP contribution as compared to 20 per cent for the rest of the world), the challenge and opportunity is to bring a self realization among mass India, of the need to also save smartly, through Recurring Savings, through a mutual fund”.

     

    He added: “Being a Top 5 MF player, at BSLMF we were quick to recognize this opportunity and decided to remind mass India about the merits of regular savings through MFs by reminding them of the thirsty crow fable we all heard and grew to. The moral of this story is what we hope creates self realization among our target audience. And in execution, the fable route and the animation approach was chosen for its ease in understanding and to build an instant connect on our core messaging. We decided to rely on a fresh and non threatening approach, going away from what’s now expected as a typical predictable FS advertising look and feel.”
    What according to you is the differentiating factor about the ad?

    • Simple yet powerful concept of regular savings through fixed income instruments of MF- easy for investors to understand and comprehend
    • Inculcates the habit of regular and systematic savings and take advantage of power of compounding
    • Fresh look and feel using an animated approach and a fable, story – telling route, a first in Financial Services category

     

    Compiled by Shubhangi Mehta

     

     

  • In the first edition of our MxM Mondays, a cross-section of the media on the ownership of our news media. Should there be entry barriers?

    Is news media ownership a cause for worry?

     

    By Shruti Pushkarna

     

    Hardly had the news of the acquisition of English news channel NewsX by ITV Media Group and Hindi news channel Live India by Prosperity Agro filterd in, there were murmurs on whether it was vital for the government to impose entry barriers for the news media. ITV of course has been in the news for around five years and Live India already had a sizeable stake by a property developer HDIL.

     

    As part of MxM Mondays, we spoke to a cross-section of news media practitioners to offer their views on the issue.

     

    This issue of media ownership has been debated on in the past, and more so recently, because of the entry of corporate groups into the news media. Earlier this year we saw two big corporates enter the media domain, when Reliance Industries bought a stake in Raghav Behl-led Network18 and Aditya Birla Group invested in the Aroon Purie-led Living Media India.

     

    While big business owning media is not a new phenomenon, there are numerous instance of politicians owning and controlling sections of the media, especially in Southern India.

     

    Hence the question arises: Is it a cause for worry when people with non-media interests start owning the mass news media?

     

    Here are a cross-section of views from captains of the industry (in alphabetical order of their last names):

     

    Tariq Ansari, Chairman and Managing Director, Next Mediaworks Ltd

    Tariq Ansari

    The worry is not around who owns the media but whether they act in a way that is consistent with journalistic standards of integrity and fair play. We seem to have forgotten simple journalistic conventions like a declaration of interest from the owner of the publication/channel on stories in which there is a substantial commercial interest.

     

    Media, much like steel or fertilisers or communications, will eventually belong to those who have the means and desire to invest in it. The point about it being the preserve of a few is inexplicable. Nobody is stopping anyone from raising the capital to start a newspaper/magazine/TV station/radio station/website. We live in a free country. Anyone who has the ability to own media should be able to do so, without limitation. Clearly my preference would be that criminals or those with clear vested interest should not own media, but I am not sure if the law of the land can prevent this from happening.

     

    Vinod Mehta

    Vinod Mehta, Former Editor-in-Chief, Outlook magazine

    I am worried. Media diversity is very important for freedom of the press. I don’t want Media in the hands of a few owners. It should be open to all.

     

     

     

    And here’s what MxMIndia’s regular columnists say:
     

    Ranjona Banerji, senior journalist, columnist and Contributing Editor, MxMIndia

    Media ownership is a worry to the extent that journalists are not able to withstand corporate pressure. For instance, the Birlas started Hindustan Times and the Tatas has a stake in The Statesman (to name just two) and the battle between marketing and editorial is as old as the profession. The problem comes when senior editors capitulate and reader interest is surrendered or sacrificed. I would turn the spotlight back on journalists: are we fighting the good fight?

    _______________________________

     

    Mediaah/Pradyuman Maheshwari, editor-in-chief, MxMIndia:

    Many years back when I asked a leading industrialist why he was keen on starting a news channel he replied with the famed Deewar dialogue (some alcohol in the system did the trick): Aaj mere paas buildingey hai, gaadi hai, bank balance hai, but even then these guys owning newspapers and channels are ruling the world. We were in the late 1990s, and journalists and news media owners were indeed much sought after. That may have waned over the years, but the desire to own news media stays. What hasn’t changed is that the intent of owning the news media goes far beyond returns on investments.

     

    When the British ruled India, it was the desire to mobilize public opinion that led to several national leaders and even businessmen to embrace news. Post-Independence, with the birth of a new economy, it was a mix of nationalistic sentiment and also to use it as an ally in a tightly controlled business environment. The ’60s and ’70s saw the media taking off with magazines like the Illustrated Weekly of India, later India Today and several others in regional languages. The imposition of the Emergency got people to realize the importance of the news media as the liberalization of the economy and and the airwaves ensured that there is no looking back.

     

    Being a democracy, there are no entry barriers to the media. And rightly so. However, when a few years back a few real estate and assorted players jumped into news television there were representations to the information and broadcasting ministry that there ought to be tighter controls.

     

    The current murmurs are being heard because NewsX has been acquired by businessman Kartikeya Sharma. ITV, his media company, also runs the newspaper Aaj Samaj and regional and Hindi news network India News. And the reason for the concern: it was feared that being the brother of Manu Sharma who has been convicted in the Jessica Lallmurder case, he could misuse his position to influence the executive and the judiciary. Well, the Supreme Court upheld its sentence of life imprisonment in 2010, so evidently he didn’t achieve much. To be fair to Sharma, a senior editorial and business executive who has worked with him, told me that he saw no interference on content, especially on the Manu Sharma front.

     

    Clearly, the money power of rich businessmen and politicians cannot bring in readers or viewers, as the case may be or make a success of the media enterprise. In the late’80s, the Ambanis acquired Commerce Weekly and converted it into a business daily. They also acquired The Sunday Observer that was once edited by Vinod Mehta and was exceedingly popular.  The Ambani indulgence in the media failed despite hiring top journalists and publishing executives. They could only use the papers to fight a few minor battles, and even those without much success.

     

    Mehta worked and fell out with industrialists Vijaypat Singhani and L M Thapar as both found news too hot to handle and counter-productive to their primary businesses (and revenues). One had assumed he would meet the same fate when Rajan Raheja, a then-emerging industrialist with some interests in real estate, set up the Outlook magazine group. Mehta has led many battles with the mighty and powerful in his magazine and both Raheja and Mehta have survived each other.

     

    Save the Outlook example which is a good indicator of business interests and independent journalism co-existing, clearly big money is not enough to drive consumption of news media. My worry though lies elsewhere:

    1. Lack of transparency in the ownership of media.

    2. Creation of a monopolistic scenario with business groups investing in multiple and similar vehicles

    3. Level playing field for competition in case of vertical and/or horizontal cross-ownership, and

    4. Diversification of media companies  into entities beyond news

     

    1 & 2. Transparency requirements in media ownership are critical. When the government announced recently that a certain conglomerate doesn’t not have interests in the media, is it really the case, or is that what is on paper and hence deemed correct? While doubts have been raised about how the acquisition of a sizeable chunk of Network 18 via an independent trust would impact the editorial independence of the group, the real worry is the rumoured interests of the group in other media ventures too.

     

    Could we have a situation that a genre of channels or newspapers or the media entities in particular region of the country be owned – directly or indirectly – by one group? How do we tackle a monopolistic scenario such as this?

     

    3. The PR head of a radio station in Delhi once complained that she could never hope to get her press release into the two main English dailies in the city because both had their own FM stations. So, while the most inane event from the group’s radio station gets covered, the lady’s FM frequency never got a mention even for a big activity. So rampant is this blacking out of a rival group’s activities that it’s now considered standard practice. In many countries there are strict rules for horizontal and vertical cross-ownership. While the TRAI has suggested restrictions in vertical ownership (a TV channel can’t fully own a DTH or cable platform etc), horizontal ownership is fine (so a TV channel can also run a newspaper, radio station etc).

     

    4. The last of my worry areas can be a bigger concern, and, if misused, even graver than big business or a political party getting into the media. Many news media groups have invested in sectors outside of news and doubts have been expressed if there is any connect between the relationships with governments via the news media and the winning of such contracts.

     

    Even though the government at the Centre is weak, and we can be sure it will flex its muscles often enough in the run-up to various elections until 2014, I don’t see any immediate solution to the problem. But what can play a deterrent for those who abuse the media will be public opinion via social media.

     

    Sevanti Ninan, Editor, thehoot.org and Columnist, Mint

    Sevanti Ninan

    Yes, it is a cause for worry when people with vested interests start owning the mass media because political ownership of the media is increasing, and there are no transparency requirements on media ownership.

     

    Readers and viewers are unable to discern ownership-related biases. There is also a renewed trend of corporate investment in media increasing. Media companies are supposed to file ownership details with the registrar of companies, but one, it is not properly done, and two it is very difficult for lay people to access the correct and latest data.

     

    On the issue of media being a preserve of only a certain groups, even now it is fairly widely owned.

     

    Maheshwar Peri, Chairman, Pathfinder Publishing India Pvt ltd

    Maheshwar Peri

    In my opinion there is no cause for worry. I think, increasingly, the cause for worry comes from a few industrialists who’ve gotten into media. But if you go back to the flag bearers of Indian journalism in the 1980s, Indian Express was owned by RNG, an industrial group. So, to say that ownership by industrialists would hurt media is a slightly wrong way of looking at it.

     

    There is definitely a cause for worry when people get into media for reasons other than running it as a professional empire. If you look at some of the politicians who’ve come into media or political parties that are launching their own channels, that’s a cause for worry because they have a reason to dish out news which suit their needs and opinions.

     

    So there is a problem when people in public office get into media, but it’s not so much of a problem if industrialists or venture capitalists or any others moneybag get into it because they want to make it a commercially viable operation. And they know they can make it commercially viable only when the reader/viewer respects them. In case of politicians, they are not interested in making it commercially viable; they just want to ensure that their point of view finds a space in the public domain.

     

    I think unless a reader or consumer respects you, you won’t be able to sell beyond a point. So all of us, whether or not owned by corporates, are always trying to ensure that we give unbiased and credible information so that the reader continues to respect us as well as the advertiser continues to invest in us.

     

    And what makes one think that they have a better opinion about media than a fruit vendor? I don’t think there can be a classification of who has a better opinion about certain things in this country – we are a democracy. So the worse thing is to say that ‘these’ kind of people can get into media and ‘those’ kind cannot.

     

    Tarun Tejpal, Editor-in-Chief, Tehelka magazine

    Tarun Tejpal

    To some extent, there is cause to worry about media ownership. We have to air, discuss and examine issues of monopolies, cross media ownerships, and of cross business ownerships. And to try and build in some structural safeguards that both help ensure the financial viability of honest, robust media, and deter media owners from using their media instruments for unfair advantage in their other businesses.

     

    Theoretically, it (media) should be open to all. But we must build in safeguards that minimize the misuse of public discourse and public instruments of media. This is not easy, but a discussion must start on this issue at all levels.

     

    Paranjoy Guha Thakurta, Senior Journalist

    Paranjoy Guha Thakurta

    The growing corporatization of the Indian media is manifest in the manner in which large industrial conglomerates are acquiring direct and indirect interest in media groups. There is also a growing convergence between creators/producers of media content and those who distribute/disseminate the content.

     

    In India’s unique ‘mediascape’, it is often contended that the proliferation of publications, radio stations, television channels, and internet websites is a sure-fire guarantor for plurality, diversity, and consumer choice. There were over 82,000 publications registered with the Registrar of Newspapers. There are over 250 FM radio stations in the country. Despite these impressive numbers of publications, radio stations and television channels, the mass media in India is possibly dominated by less than a hundred large groups or conglomerates, which exercise considerable influence on what is read, heard, and watched.

     

    One example will illustrate this contention. Delhi is the only urban area in the world with 16 English daily newspapers; the top three publications, the Times of India, the Hindustan Times, and the Economic Times, would account for over three-fourths of the total market for all English dailies.

     

    However, what is unacceptable is media barons using news outlets as tools to further their business interests. In this country, as in the world over, large media corporations are clearly playing a bigger role in the political economy that they report on. Though a free media is fundamental to the existence of a liberal democracy, concerns about the accountability and transparency of media companies remain. For instance, the RIL deal has enabled Network 18, Eenadu, and the merged group to expand its offerings to benefit its stakeholders and its advertising target audiences. What remains to be seen is whether clear boundaries can be etched between the boardroom and the newsroom.

     

    There’s absolutely no doubt about the fact that if it’s truly going to be a responsive media, then the media should reflect the views, the interests, the aspirations of a larger section of population as possible. The problem with much of our media is that they are too busy trying to ‘reach’ consumers to potential advertisers than providing information to citizens.

     

    Next Week:

    Why do we all like to damn TAM?

    The Sectoral Innovation Council recommendations last week said that there was need for an alternative to TAM, short for the media research company formed by a jv of two international research biggies: Nielsen and Kantar. This is a view that has been expressed several times over the years.

     

    One of the main peeves against TAM is the number of Peoplemeter boxes present to collect data. Can 8000+ boxes effectively poll a populace of 1.2 billion, is what many broadcasters keep asking in public. In private though, not many are ready to pay up by increasing their subscription fee to enable the installation of more boxes across the country.

     

    Also, what’s happening to BARC, the joint industry body that was to provide an alternative?

     

    MxMIndia will speak to a cross-section of the industry to get answers. Meanwhile, if you have a view, email it to us at editor@mxmindia.com with the subject ‘MxM Mondays #2’

     
  • The TV Today networks' news channels and radio stations have been under severe pressures thanks to a weak market and competition

    No successor to Joy Chakraborthy named, testing times ahead for TV Today network

    By A Correspondent

     

    On the face of things, it’s meant to be a simple parting of ways. Although outgoing TV Today Network CEO Joy Chakraborthy has quoted personal reasons and being away from the family based in Mumbai as his reasons for moving on, the industry has been abuzz with stories about the sudden departure.

     

    Joy Chakraborthy
    Joy Chakraborthy

    India Today group Group CEO Ashish Bagga confirmed the departure of TV Today CEO Joy Chakraborthy to MxMIndia on Tuesday evening adding that no replacement had been announced it.

     

    Mr Chakraborthy had joined TV Today on December 1, having quit Zee Entertainment as executive director (revenue and niche channels) in October 2011. In September, G Krishnan had announced his departure from the Network. In the new organization realignment, Mr Chakraborthy reported to Mr Bagga.

     

    The news channels and radio station that come under the TV Today umbrella have been under severe pressures thanks to a weak market and competition from other networks. While India TV has been a clear trendsetter in popular Hindi news, ABP News (eka Star News) has been galloping ahead. Sadly, for Aaj Tak, the name change has not adversely impacted the MCCS-owned Hindi channel.

     

    In fact flagship Aaj Tak has been going through an identity crisis for a while. Should it be a serious news channel and be recognised for the journalistic values that the India Today group stands for? Or should it be populist with dumbed down news and toe the line of the Rajat Sharma-run India TV? Sibling Headlines Today, the English news channel from the group, has also made little headway. Save a few spikes since it was set up, it’s just not caught the attention of the viewing public and continues to lag in ratings and revenues. Ditto with Oye 104.8 which is low on the RAM roster. The rechristening from Meow to Oye may have helped shore up some numbers, but it’s not been good enough.

     

    With an investment from the Aditya Birla group helping improve its financial muscle, the TV Today was poised to grow much in the next two years. Regional channels, digitization, acquisitions, Phase 3 of FM radio were some of the plans that required nurturing. Mr Chakraborthy, who is a seasoned media professional, was to lead this effort.

     

    But now it will mean the collective efforts of Mr Bagga, chairman and editor-in-chief Aroon Purie and his daughter Kalli Purie who heads the group’s digital operations and looks at synergies within the businesses and is also Chief Creative Officer to take TV Today to the leadership position it once occupied.

     

  • What excites kiranawallahs is the huge margin they get

    Kiranas dump big brands for high margin Bharti Walmart wares

    By Sagar Malviya

     

    A few months ago, Dhananjay Jain, a grocery owner at Vidisha Road in Bhopal, decided to stock two alien brands – Right Buy and Members Mark – because they offered much higher margins than national brands and had lower price tags. Today, these floor cleaners, tea and cornflakes brands contribute nearly 20 per cent to his monthly sales.

     

    Many of his consumers may still have no idea where these brands priced 10-30 per cent less than those of Hindustan Unilever, Dabur and PepsiCo are sourced from. Well, they come from the world’s largest retailer, Walmart.

     

    Mr Jain gets these brands from a Best Price Modern Wholesale outlet – run by Walmart’s joint venture with Bharti Enterprises – just two kilometres from his store.

     

    Walmart is not allowed to sell directly to Indian consumers yet, but its brands across some three dozen categories have started sliding into Indian homes, as its cash-and-carry venture becomes a hit among grocery shop owners.

     

    “The idea is that the reseller should make more profits by selling our brands than he does by selling national brands,” said Arvind Mediratta, chief operating officer of Bharti Walmart. He said the firm’s private labels adhere to all the quality norms despite their lower price tags.

     

    Bharti Walmart operates 17 cashand-carry format Best Price Wholesale outlets, selling products to licensed neighbourhood stores, schools, offices and large enterprises. It has more than 3 lakh members, who own grocery stores.

     

    The firm launched Right Buy and Members Mark after phasing out its earlier brand Great Value, which is now restricted to Bharti’s Easy Day supermarket chain.

     

    So far, Walmart has developed a network of 100 suppliers to make private label products ranging from groceries, home care and personal care products to apparel and stationery. And it may soon get into categories such as soaps, shampoos and detergent. “We are planning to add several more categories in coming months and open over 10 outlets by next year,” Mr Mediratta said.

     

    Company officials say its brands already control 20-22 per cent share in most categories at its members’ outlets. Some shop owners even say they have stopped stocking national brands. “In categories such as floor cleaners and dish washing, we have stopped stocking national brands as consumers just want the lowest priced products in these segments,” said Mohammed Fayaz, a storeowner at Guntur in Andhra Pradesh, where Walmart has opened two wholesale outlets.

     

    What excites kiranawallahs is the huge margin they get. For instance, a 500ml bottle of Walmart’s toilet cleaner brand sports a price tag of Rs55 but is available to a kirana owner at Rs37. That makes the retailer’s margin a whopping 48 per cent. National rivals such as Reckitt Benckiser’s Harpic and HUL’s Domex are sold at Rs58, with the grocer earning 12-15 per cent margin on an average. Bharti Walmart also provides 10-30 per cent higher margins than national brands on tea, colas and juices that allow shopkeepers earn 10-30 per cent higher margins than national brands. Consumer products companies have been increasingly fighting private labels of modern retailers.

     

    In fact, private labels outsell several national brands in home care and packaged food categories at the outlets of retailers such as Future Group, Reliance Retail and Aditya Birla Group.

     

    FMCG companies didn’t feel too threatened because modern trade accounts for just 7-10 per cent of their total sales. But now, with Walmart’s private labels finding place in consumer companies’ largest sales channel – the country’s ubiquitous neighbourhood stores – this trend could become a headache for them.

     

    “As Walmart and other similar players scale up their cash-and-carry operations, given the price consciousness of the Indian consumer and the fact that kirana stores are here to stay, it is likely that this trend will start to worry large consumer goods companies,” said Siddharth Bafna, partner at advisory firm Lodha & Co.

     

    Not everybody agrees. The chief executive of a leading consumer products firm, however, said such private labels would not challenge big brands in evolved categories such as personal care. “There are always some categories, especially commodities, that are more prone to losing out to private labels because of pricing. However, several brands in the personal care segment that keep innovating aren’t threatened by private labels even in markets where modern trade is evolved,” the person said, requesting anonymity because Walmart is one of its partners.

     

    Some shopkeepers say it’s not easy to make people try new brands. “We are able to convince some consumers to opt for lower priced Walmart brands. But there are still many consumers who want to buy popular brands from national companies even if the price is higher,” said Jas Karan Singh, a store owner in Amritsar, where Walmart opened its first cash-and-carry outlet four years ago. Private labels accounted for around 7 per cent of Bharti Walmart’s annual sales of Rs 1,876 crore last calendar at over Rs 130 crore.

     

    Worldwide, the US retail giant is performing well despite the slowdown. For the fiscal year ended January 2012, it increased net sales by 5.9 per cent to $443.9 billion and ranked first on the 2011 Fortune 500 list of the world’s largest companies by revenues.

     

    Source: The Economic Times

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

     

  • Senior journalist and media-watcher Paranjoy Guha Thakurta on what the Aditya Birla investment in the India Today group means for the Indian media

    Loss of plurality is worrying: Paranjoy Guha Thakurta

    Paranjoy Guha Thakurta

    By Paranjoy Guha Thakurta

     

    This sort of an acquisition is part of a growing trend of ‘corporatization’ of the media where big business houses such as the Aditya Birla Group and the Reliance Industries group are investing into existing media groups. Through this process of consolidation, they are also bailing out these groups.

     

    The Raghav Behl-led Network 18 and Ramoji Rao-led Eenadu are now part of one big conglomerate because Reliance Industries Ltd (RIL) has bailed out both by pumping in a huge amount of money. On paper, it appears as if they are still separate corporate entities, which they are, as per the laws of the land. But the kind of associations they have struck gives an impression that they are now going to work like a conglomerate. Now this is exactly what has happened in the case of Mr Aroon Pourie who heads the India Today group which is also going to be one major conglomerate. So what we are seeing, in that sense, is the ‘cartelization’ of the media. There are cartels being formed, there are oligopolies being formed.

     

    The recession in the west has led to shrinking of advertising expenditures for the media in India and across the world especially after 2008, and this has had a direct impact on the fortunes of media organizations. So this process of consolidation has got expedited. What this means is that the media in India is going to become less plural, it’s going to be dominated by relatively fewer groups. What you are really seeing is, large corporate groups exercising greater dominance on the media. Now there are two implications.

     

    Also read:

    AV Birla group buys 27.5% in India Today group

     

    Birla may use personal money for buy, Mail Today may now launch editions in Mumbai, other metros

     

    Why media purists needn’t worry about Kumar Mangalam Birla’s 27.5 % in Living Media

    One is, of course, you are finding telecom companies (Mr Aditya Birla also happens to be the head of Idea and Mr Mukesh Ambani’s RIL is a major player in the broadband wireless access space), which are providing you communications, are also now playing an important role in companies that produce content. So the content providers and content distributors are coming together. This, in my opinion, is going to result in a loss of heterogeneity, resulting in a loss of plurality. In a sense, the oligopolies that are going to be formed will also impact the listeners of content, the viewers of content, or the readers of content. The content they get will be less heterogeneous.

     

    The other part of the story is that these companies are also big advertisers. Therefore, the clout of the advertiser will go up. As I said, the telecom service providers are now becoming important stakeholders in companies that are producing content. So the distributors of content are becoming stakeholders in the producers of content. Similarly what you also see at another level, the companies which are big advertisers are also now becoming the owners of the media. So in my opinion, these trends towards ‘cartelization’, or the formation of these giant corporate conglomerates is not going to lead to greater plurality as far as the consumers of content are concerned.

     

    The numbers of TV channels and newspapers and websites often give you a very deceptive kind of a picture and the capital is a classic example of that.Delhiis the only city in the world with 16 English language daily newspapers. This gives you a misleading picture, that readers of English dailies inDelhihave a huge choice. But the fact of the matter is that two newspapers, The Times of India and Hindustan Times would account for well over three-fourths of the total market of all English daily newspapers. And if you add to that Economic Times, then these three publications put together would account for more than 80 per cent of the total circulation of all English newspapers in India. So, in terms of numbers it looks good, but if you look at the structure of the market, you see few dominant players.

     

    In India, unlike in other countries of the world, like US, UK or Australia, there are no cross-media restrictions. In other countries, there are both vertical as well as horizontal restrictions. Vertical restrictions mean that the content producer and the content distributor are different companies/groups. In India, the same guys who are producing content are also distributing the content. You have the DMK controlling the distribution channel and also producing the television channel; you have Zee News producing news and also controlling Dish TV. There are clear conflicts of interest that arise if your distributor and the provider are the same. That’s only one part of the story.

     

    The other is what is called horizontal cross media restrictions. That means, the same company dominates all forms of the media, like print, radio, TV, in the same geographical area. In our country we don’t have any legal restrictions on cross media holdings. As far as the media is concerned, the group concept or the conglomerate concept does not operate in our country. So you have Bennett Coleman Ltd which brings out various print publications, and then you have Times Global Broadcasting which brings out the television content. These two companies happen to be controlled by the same set of people. But because the legal restrictions that exist in India apply to individual entities and not to conglomerates, effectively you have no cross-media restriction.

     

    Speaking of editorial content, editors will not publish or broadcast anything that would go against the interest of the corporate that controls; these would become subtle forms of censorship and control. For instance, Living Media which includes, Aaj Tak, India Today, Headlines Today and Mail Today, these publications or these broadcasters are unlikely to publish anything negative that could affect the business interests of the Aditya Birla Group. So that could be an eminent danger, that degrees of freedom that editors and content providers would enjoy, would get curtailed not just because of the pattern of ownership but also because the owners of major conglomerates are also major advertisers.

     

    Even if on paper, the editors have the autonomy and independence to publish what they like, there could be subtle forms of censorship wherein editors would feel constrained or would think twice before publishing any story that could in any way go against the interest of the promoters of the company that control these media conglomerates.

     

    I am optimistic about the future of media in India but I am also concerned about the fact there is loss of heterogeneity, loss of choices to the consumer.

     

    (As told to Shruti Pushkarna)

     

    Paranjoy Guha Thakurta is a senior journalist, editor and broadcaster based in New Delhi.

     

  • The Aditya Birla group investments may help India Today invest in launching editions of its newspaper Mail Today in Mumbai and other metros.

    Birla may use personal money for buy, Mail Today may now launch editions in Mumbai, other metros

    The Aditya Birla group investments may help India Today invest in launching editions of its newspaper Mail Today in Mumbai and other metros.

     

    By A Corresdpondent

     

    Kumar Mangalam Birla, chairman of Aditya Birla Group, has bought a 27.5% stake in Aroon Purie-controlled Living Media India, the publisher and owner of India Today magazine and Aaj Tak television channel. Mr Birla will use his personal money to invest in the New Delhi-based group, which straddles the entire media chain, from television to magazines to tabloids.

     

    A statement from the metals-to-retail group said Birla has agreed to join the Living Media group as a financial investor. It did not specify the price for the deal or the valuation.

     

    However, investment bankers close to the transaction said the deal has been finalised for Rs 600-700 crore, valuing the media group at Rs 2,400-2,800 crore. Mumbai-based investment bank Ambit Corp was the advisor to the deal.

     

    This is the second big investment by an industrialist in the media space. In January, affiliates of Reliance Industries agreed to buy a large stake in the companies of Raghav Bahl, the promoter of Network18 and owner of channels such as CNBC-TV18 and CNN-IBN. The investment was worth over Rs 1,500 crore.

     

    TV Today is listed on the stock exchanges, but it is not clear whether Birla’s personal investment companies will now have to make an open offer to buy 26% from public shareholders.

     

    The financial investment also marks the realisation of Kumar Mangalam Birla’s cherished dream of owning a media company. “The media sector is a sunrise sector from an investment point of view. I believe that Living Media India offers one of the best opportunities for growth and value creation,” Birla said in a release.

     

    Birla made an unsuccessful entry into the entertainment space by launching a movie and TV production company, Applause Entertainment, in 2003. The company, which produced the acclaimed movie Black , was closed down in 2009 after the downturn in the entertainment industry sparked off by the global recession.

     

    Living Media will use the cash from the deal to expand its presence in media. It may now look at launching its New Delhi-based tabloid, Mail Today, in other metros, including Mumbai, according to persons close to the company.

     

    Source:The Economic Times

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

  • Awards are just another recognition for marketers and agencies to do more better says Ajay Kakar, CMO-Financial Services, Aditya Birla Group

    We’re here 2 get inspired & celebrate: Ajay Kakar

    Ajay Kakar, CMO-Financial Services, Aditya Birla Group shares his idea of the changes spotted this year at Goafest and the inspiration it has on the youth of today.

     

    What’s there for clients at Goafest?

    Goafest 2012 is a boiling pot for media, marketing and advertising industries to come together and think, discuss and get inspired. And I think 2012 was no exception.

     

    Key takeaways from sessions…

    Takeways remain the same: whatever you do, whoever you are there is so much more that you can do, there is so much work for you to get inspired and learn from. You go back thinking that whatever I have done, I have not done enough. We need to tap the real potential.

     

    Emphasis on digital…

    Digital has been given due focus for many years now. My one request or regret is that we should stop calling it digital and new medium; it is the medium of today and it will be the medium of tomorrow. How do we bring the potential upfront with the many success stories, I think that should be the focus going forward.

     

    Recognition through awards…

    Awards are just another recognition for marketers and agencies to do more better. This year, the number of entries, the number of agencies from which these entries came and the quality of entries have really done us proud. I think that’s the important part – it’s the work that we are here to get inspired by and celebrate. That’s been a great reality this year.

     

  • TV Today scrip rises on rumours of AV Birla Group picking up stake in Living Media

    TV Today scrip rises on rumours of AV Birla group picking up stake in Living Media

    By A Correspondent

     

    The TV Today Network has always been making news thanks to the fact that it runs Aaj Tak, the premier Hindi news channel other than a host of others. On Monday, amidst speculation that the Aditya Birla group is picking up a sizeable minority stake in the Living Media, which in turn owns a majority (57.15%) stake in TV Today, the television news company shares surged 15.23 per cent closing at Rs 68.10 on the Bombay Stock Exchange.

     

  • So, while PR is about press relations, it is also about influencing the influencer. It's about creating credibility and about credible ways of influencing people to act

    The power of Public Relations: Ajay Kakar

    By Ajay Kakar

     

    As a marketer, we have many communication tools to capitalise on for the advantage of our brands and our business. To me, these ‘weapons’ (advertising, direct marketing, public relations et al) are very akin to a Swiss army knife; you can use any or all of these weapons, depending on the task at hand.

     

    But in my many years at the agency end, with stints in direct marketing, advertising and public relations, and now as a client, I have found “PR” to be the least understood, appreciated and under-leveraged communication weapon – by both the marketing and (believe it or not) agency fraternities in India. And most surprisingly, the PR fraternity too.

     

    As a long standing convert and staunch believer in this discipline, let me share with you my 20-year-old association with the PR discipline and the reasons why I believe that it is arguably the most powerful communications arrow in a marketer’s quiver. Also the reasons why I believe that the discipline has yet not got its full dues.

     

    So here’s the story of my tryst with public relations, or, if I may so say, the story of public relations in India, over the last two decades.

     

    PR, in fact, changed my life!

     

    PR is actually the exotic siren who first tempted me to leave my career in accounting and audit, to venture into the (for me) unfamiliar and untrodden path of communications.

     

    In 1991, I came across an interview in the Business India, with a person called Steve Lyons (I still remember the name!), who was then the head of a company called ‘Ogilvy PR’ in Singapore.  Believe it or not, until then I had never even thought of the advertising world, or even heard of “Ogilvy”.

     

    The article impressed me so much that I immediately searched out the agency’s address and cold-called the then-MD of Ogilvy and Mather, India, Mr. Mani Aiyer, hoping for a break in his PR unit.

     

    Hearing my motivation for joining PR, he tried to temper my new found passion, but having gauged me as a person who was not going to be swayed easily, he had me meet the head of Ogilvy PR in India. And that meeting shattered all my dreams and illusions.

     

    In 1991, PR, in India was nothing more than “Press Relations” – getting media coverage…lots of it…at any cost.

     

    Dejected, I decided not to pursue this temptress. And when I went back to Mr. Aiyer to thank him for his time, he actually offered me a job in advertising. Needless to say, he made a passionate pitch that swept me off my feet. And on May 2, 2001, I became an employee of Ogilvy & Mather (though not Ogilvy Public Relations).

     

    But fate was not going to let me off the hook, so easily.

     

    In 2003 I was invited to take on an additional mandate at Ogilvy, as the country head of Ogilvy Public Relations, in India. Before the end of 2004, I was the president of the industry body, Public Relations Consultants Association of India. And in 2005 I had switched over to the other side, the client side, where I became an active user of PR.

     

    And today, as 2011 comes to an end and 2012 draws near…

     

    Two decades have passed, but ‘PR’ remains mere press relations – in the minds of the practitioners – be they the PR professionals, or their user base.  Of course there may be a few exceptions. But these are far and apart. “PR = press relations” is all that we care to believe. Unless….

    In moments of need, even atheists are tempted to remember God. …. “Forgive me father, for I have sinned”. And when brands have ‘sinned’ or find themselves in a tight spot, they have reached out for public relations and found this discipline to be a saviour.

     

    As an example, just remember the days when colas were synonymous with pesticide and you will know what I am referring to.

     

    But back to any ordinary day….

    At Ogilvy, I recollect instances when I presented a Rs5 crore estimate to a client for an advertising campaign (do remember that in the mid-90s this was a princely sum) and got an instant sign off. And then when I wore my PR hat and asked for a Rs5,000 pm hike in fee from the same client (do remember that even in the mid-90s, this was a meagre sum), the client would wear a thinking hat, but refuse to lift his pen to sign on the dotted line…and finally it used to boil down to… “But you guys make so much from us on advertising. So why do you need to be paid, for PR!”

     

    These instances would leave indelible marks of pain on my professional pride. But looking back at all such instances, I realised that I had to ‘forgive them, for they knew not what they did’. Because they knew not what PR is and what role PR can play in their lives and the lives of their brands.

     

    So it was the number of clips that we were measured by. Else, the column centimetres of editorial coverage. Or the rupee value of the editorial coverage. Or the coverage we got (or did not) for the client’s son’s sports day. Media coverage. Media coverage. Media coverage.

     

    This was and still is a malaise that ails the PR industry inIndia. And some parts of the world.

     

    What is PR? What are the key deliverables one should expect? How should the impact of PR be measured? How would you like to substantiate your proposed fee or fee hike?

    Ask 5 practitioners this question and in all probability you will get atleast 6 (different) responses. So as a client, how do I value or respect a ‘good thing’ when I don’t even know what it is! Or how to measure it!

     

    This has been a burning need for the industry to rally around and define and ‘standardise’ expectations, industry-wide definitions and measures. But two decades later, the questions remain the same. And there is yet no answer. No understanding. No empathy.

     

    So while the PR industry keeps asking “why are we paid peanuts”, the user industry keeps answering “because we (think we) are getting monkeys”. This never ending coffee-toffee debate needs a closure. Soon. And I do appeal to the industry to claim their rightful place under the sun. At the earliest. By first addressing the basics. The questions that we cannot wish away. And then, of course, delivering on them.

     

    Until then, it is to our collective disadvantage that PR is considered a mere commodity. And we are seen as under cutting each other to win mandates. These mandates are soon lost, when the client is not in a position to evaluate or measure our success. Or the lack of it.

     

    The client base of the public relations industry is increasing by the day (there will never ever be a shortage of clients). But the number of satisfied clients? The number of clients making use of, and benefiting from PR in all its glory? Who is counting!  And therefore it hurts the believers, when India wins a PR Lion at Cannes. Because it has been won by an ad agency! Not a PR agency.

     

    So is there mere gloom and doom in the PR industry? Not at all!

     

    There are various case studies where PR has hit the bull’s eye and demonstrated it’s true potential and power. Let’s visit some of these and take inspiration from them.

     

    Today’s exceptions, tomorrow’s rule…

    It would be right to cite a few examples here that could redefine the way PR is perceived.

    We all know of John Travolta as an actor, singer, dancer but do you know that he is also a licensed pilot? So when Qantas, the airline from ‘down under’Australia, wanted to reach out to as a relevant airline for European markets, they actually got John Travolta to fly their planes to these destinations. The kind of coverage that this exercise got in local as well as world media was mind-boggling. So Qantas used this “a facet of John that you did not know”, to express “a facet of Qantas that you did not know”.

     

    Cadbury’s was hit by a crisis – the worm infestation case – that nearly threatened the very existence of the brand in India, as mothers questioned their generations of trust in Cadbury’s chocolates. At Ogilvy PR I had the opportunity to partner this iconic brand and their leadership team on the exercise that is now a case study for Cadbury’s, worlwide.

    Customers. Channel. Influencers. Regulators. Government. Employees…all these key stakeholders had to be reached out to, repeatedly and regularly. And the media was only one of the bridges to reach out to them. It was “public” relations at play. And not mere ‘press’ relations.

    Today Cadburys keeps scaling greater highs. It not only won back the trust of a nation. But also its loyal customer base and their sales graph. And this incident appears to be a distant dream. But in those days, every day appeared to be like a never ending nightmare.

    As an agency and team, we had the opportunity to get into the hearts and minds of the senior management team on an ‘online real time’ basis. Every day. For weeks.

     

    Gillette is another company that has realised and capitalised on the power of PR, year after year. You will remember their W.A.L.S (Women Against Lazy Stubble) campaign. And now the Shavesutra campaign.  Their movement has resulted in 12.2 million Indians casting their vote for a clean shave. It also led to rise in sales and popularity of the product and also bagged numerous awards…their sales going up by 500 per cent, market share up by 400 per cent, an entry in the Guinness book of records…and over $ 2.5 million worth of free media coverage.

     

    The Body Shop is another classic example of a brand that has enjoyed the favours of PR. No advertising. And still, it’s a global brand with very strong bondings with its consumers, as an eco friendly company.

     

    Or, the mother of all “PR” campaigns… Mahatma Gandhi’s freedom struggle. He influenced an entire nation to realise the power of self rule… and got ‘results’ in the form of India’s Independence.

     

    So, while PR is about press relations, it is also about influencing the influencer. It’s about creating credibility and about credible ways of influencing people to act. It is not only about journalists but about customers, employees, shareholders, channel partners and other key stakeholder’s perceptions management. It is a weapon that can do wonders in not only the brand’s good times, but more so in the bad times too. It can give business solutions and tangible results.

     

    So if you ask me, PR is about ‘Public’ and not ‘Press’ relations. It is about ideas that influence and engage my ‘public’ and something that has a multiplier effect. The credible way. And my belief is that if you capture the right essence of PR, you will not need to chase the media. The media will come chasing you.

     

    From a client’s perspective, if my PR agency helps me achieve my KRAs in a simpler, cheaper and faster way, then why will I not chase you? If as clients, we earn a fixed and variable salary, then why shouldn’t my PR agency also be assessed and remunerated that way? And that the variable component should be based on tangible results.  My belief is that this is one industry where the potential of an agency’s variable earnings outstripping the fixed component is very high.

     

    If PR can demonstrate how it can help me increase my profits, customer base and revenues, in short help me achieve  my KRAs, then forget peanuts, I weigh them in “gold”.

     

    Towards this destination, two points to ponder:

    • We need talent that can deliver on this potential. Talent that can claim to be a “strategic counsel”. Talent that only handles the number of clients it can give the requisite attention to.  Today, when it comes to advertising, we can even put faces to the next generation of the industry.
    • There is so much (though still inadequate) talent. But when it comes to the PR industry? I am sure that we have many unsung heroes – be they agencies, professionals or success stories. Can the PR industry do its own PR, so that we all have role models that inspire us and we aspire to emulate?

     

    Ajay Kakar is CMO – Financial Services, Aditya Birla Group