Brand wars may be very common in the corporate sector where marketing and advertising whiz kids pit their brains and guile against each other.

But it is also a reality now in the political arena. The 124-year-old Congress Party has just recently given a demonstration of how to ‘revamp’ a brand and make it connect with old consumers who had lost faith and new consumers who ride on hope. Priyanka Rai, Surbhi Chawla & Neha Saraiya report

Such brainstorming sessions are fairly common in the corporate world where managers get together and pick each other’s brains to evolve a strategy for the future. And when it comes to brand managers, the sessions become even more intense as the war for consumer preference and market share intensifies. Meenakshi Natarajan, Jitendra Singh, Jairam Ramesh, Ashok Tanwar and Salmaan Khursheed cannot be called brand managers by any stretch of imagination. Nor can Pankaj Shankar be called a corporate communications manager. For that matter, you will not know Vishwajeet Prithvi Singh as the Chief Technology Officer.

Most management students and managers will probably not even be familiar with most of these names. And yet, these are the largely unknown names and faces that have scripted one of the most famous brand revamps in contemporary history. The first lot did the brainstorming and fashioned the current brand strategy for the Congress Party in the run up to the Lok Sabha elections. Pankaj Shankar, quietly and unobtrusively, communicated this strategy to media persons willing to listen. And Vishwajeet Singh is the geek, who used computers, spread sheets and data mining to round off the new brand strategy.

This band of men and women met numerous times in 2008 and 2009 to plan a brand strategy for the Lok Sabha elections. The challenge was formidable. The Congress was a really old brand that had seen hitherto loyal customers deserting it in droves during the 1990s. The challenge was to revamp the brand and lure back the old faithful. An even bigger challenge was to connect the more than 100-year-old party with the youth. Now, every Tom, Dick and Pundit knows the team has clicked. For people in the world of advertising, it was a marketing masterstroke. Says Josy Paul, National Creative Director and Chairman of BBDO, “ The Congress ad campaign was more about how it can be relevant to different audiences. The key to their campaign was relevance. It was more about young audiences and telling them the Congress is still relevant.” Even as late as December 2008, no one could have been certain about unknown youth ‘leaders’ like Minakshi Natarajan and Ashok Tanwar winning Lok Sabha elections. But win they did, propelling Congress towards its highest market share in the electoral marketplace in almost two decades!

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Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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SPIRITUALITY AS FMCG!

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Monojit Lahiri investigates this new phenomenon that is gaining frightening and hysterical dimensions in the ritzy, glitzy and glamorous metros of a nation that continues to look west for self esteem!

It is an astonishing paradox of human life that, with progress, sophistication, modernity and success comes depression, loneliness, alienation and insecurity! Today in year 2009, as we scan the lifescape inhabiting planet earth – with special reference to the so- called advanced and developed western countries – we find startling horror stories of dysfunctional life amidst plenty. Why? Because nothing in this world comes for free and the first world joys offered by the enticing packages called Consumerism and Globalisation come with a sinister price-tag! Family life, social life, cultural life, intellectual life … everything is sold at the altar of moving up in life. So, what’s next? What is the solution? Where is the salvation? Enter the marketers of Spiritualism…!

Declares today’s hot young, controversial film- maker (Dev D, Gulal) Anurag Kashyup, “If you have a Sapnon Ka Saudagar, why can’t you have a guy hawking spirituality?! The con-game is the same, boss!” On a more serious note, Kashyup believes that in today’s troubled and recession-hit times where tension and pressures rule the roost, spirituality is in high demand and low supply. “Hence, the smart, shrewd marketer who has his ear to the ground and is able to think on his feet, can do wonders – for his desperate clients and laughing wallet.” He cites the example of Astha and a host of similar TV channels which enjoy a wide viewership cutting across all stratas of society. He also points to the success of Rhonda Byrne’s The Secret, Robin Sharma’s The Monk who sold his Ferrari and most of Deepak Chopra’s best sellers. Sister Yogini of the Brahmakumaris (a spiritual movement like The Art of Living, The oneness university, Isha Yoga) looks at it differently. She admits that a lot of seekers come to them because they are freaked out by life’s pressures and desperately desire peace and happiness. “Our movement is not necessarily about renouncing the world but offering peace and progress within the confines of daily life.” Adds Avanti Birla, high profile businesswoman, “Spirituality for me is as much about fulfilling my responsibilities at a personal level as it is about connecting with it in a societal way.” To Parmeshwar Godrej, Mumbai society’s celebrated diva and social activist, “The real path is about self-discovery.” While she agrees that there is a trendy, hybrid spirituality being marketed, she believes that people are evolving all the time and their personal sense of spirituality doesn’t necessarily depend on what’s written in the instruction manual.

The irrepressible Prahalad Kakkar in typical forthright fashion, provides a cool conclusion. “It’s like selling coals to Newcastle! C’mon guys, we are, historically and traditionally, a spiritual nation with rituals and beliefs embedded in our psyche. Whether it’s the sandhya-deep accompanied by conch-shells at dusk or the vision of what life is about – Karma, Maya – spirituality remains an intrinsic part of our being. Unfortunately, pathetic West-apers that we have become, we seem to be enthusiastically buying - into their hard-selling spirituality to us in the form of a fashion thing; a with-it and uber-cool solution to all worldly problems that blitzes our sense of peace and contentment. Its sold – and bought – (like in the West) as a quick-fix, a fevicol for the battered soul, imagine! But then, at the end of the day I guess it makes sense to remember that we live in an age of Vigyapan not Vigyan, brother… So just about anything goes!”

Monojit Lahiri

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Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Think Bigger; Think Better: A brand philosophy or a jibe at big brother?

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Brand: ADAG
Agency: Mudra

When Anil Ambani went solo, his challenge was to build a new brand from scratch. Realising that their biggest brand was Anil himself, his key guys coined Brand ADAG (Anil Dhirubhai Ambani Group). The resulting Rs.500 crore campaign, with Anil’s old friend Amitabh Bachchan, created new benchmarks in media saturation. ADAG was the buzziest brand of 2006. Anil sure knows a thing or two about ‘people’s biz!’

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).


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Thanda matlab? Cool communication!

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Brand: Coca-Cola
Agency: McCann
It takes two to tango. But what happens when Aamir Khan decides that eight is the way to go? Thanda happens, what else! Coca Cola’s thanda matlab Coca Cola campaign not only swayed millions of Indians, but also bagged an Effie Gold. Post campaign analysis indicates that for the first time Coke was able to beat its old rival Pepsi in a big way, improving the brand’s market share in key markets viz. Punjab, Delhi and UP.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Yeh dil still maange more

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Brand: Pepsi
Agency: JWT
Pepsi established an immediate connect with its audience with the iconic Yeh Dil Maange More campaign, endorsed by a host of personalities ranging from popular film stars to cricketers like Tendulkar, Aamir Khan, Amitabh, Kajol, Rani, SRK, Remo Fernandes and more. The idea was not just to promote Pepsi but also evoke the aspirations of young Indians. The campaign enabled Pepsi to increase its brand value by 6%. Globally too, Pepsi’s brand value touched the phenomenal $11.8 billion mark. The slogan, ‘Yeh dil maange more!’ became such a rage that an Indian army major, after a crucial victory in the 1998 Kargil war famously shouted it while atop a snowy Himalayan tip. Reveals an industry insider, “Following this, Coca Cola, which had never roped in a star, got one for peddling Coke.”

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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The still-unpaid Logan bet!

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Joining hands with the French auto giant Renault SA, Mahindra & Mahindra ambitiously launched Renault in May 2007, fuelling competition in the mid-size car market. A runaway success in the European market, Logan flopped in India. The car promised plenty at its launch, given the Rs.6-7 lakh price tag and diesel engine advantage. Although it got off to a promising start, Logan was not able to sustain the momentum. M&M had to scale back production by some 30-40%. The 50,000 units capacity Nashik facility, today rolls out just over 1,000 Logans monthly!

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Where’s the passion in Indian fashion?

Professor Arindam Chaudhuri says

No doubt that fashion is a sunrise sector, but so far, the over-the-top glam quotient has only managed to leave behind glum faces in its wake. Glitzy models sashaying down the ramp with their tattooed bodies and skinny mannequins draped in sequined crêpe in store windows require huge investments. But Indian designers lack the corporate backing in terms of big sponsorships and licensing deals for that. Mumbai-based designer Rocky S attempts to explain why corporates shy away from Indian fashion houses. “If someone is investing in your business, he/she has full liability to know what exactly is happening with the money. We are still in a nascent stage to maintain such transparency,” he professes. Rocky adds that sighting the potential of corporate funding, many design houses are now starting to become more organised. “Some of us have now even begun to pay attention to financial audits,” he claims. On cue, corporate funding has also begun to happen in a small way. Textile house Raymond’s has launched a designer wear retail chain called ‘Be’ with Rohit Bal, Anshu Arora and others. Moreover, the inimitable Ritu Kumar has been designing wardrobes for all Miss India participants in international beauty pageants since 1994, with some winning awards for the most outstanding evening gown!

Is that enough for India Fashion Week (or Delhi Fashion Week) to become the fashion ‘Mecca’ of the world and steal the show from Milan which alone contributes 10% to the world’s fashion market? Market watchers do not seem to think so. Especially with the present unstructured and unorganised nature of the industry, they feel that the projected 2012 is too short a time for India to become the world’s fashion capital. Fact is, they say, that India’s designer fraternity is still wary of corporate alliances and hesitates in seeking expert financial advice. Key posts within any fashion house are still occupied by close friends and family members. “Compared to the foreign market, we have still not been able to create a very structured and organised market in India for designer wear. Designers like Tarun Tahiliani and Satya Paul have started focusing on the local market with their retail stores, but we are still lagging behind from the retail perspective,” admits Sumeet Nair, Managing Director of Fashion Foundation of India.

Acquiring professional management teams is therefore fast becoming a priority for Indian designers who want to match the standards set by their global peers. The beautiful Ritu Beri for one has already begun corporatising her set-up. Her team today boasts of separate vice presidents for sales, purchase, quality and finance; an art she perhaps learnt during her year’s stint (in 2002) as head of French fashion house Scherrer’s ready-to-wear line. On the other hand, designers like Satya Paul – who have already tasted success in India’s premium mass-market, are roping in Genesis Colors Pvt. Ltd. to handle financial and logistics related issues.

Despite the baby-steps being taken by India’s fashion fraternity to professionalise their operations, too many one-man-shows, glamorous PR plugs and Page 3 pictures abound. Sure, the talent is there and the creativity simply wows. But to make for a globally acclaimed brand and financially sound sustainable business, the trickle of corporate influence on India’s fashion design glitterati must turn at least into a tide (if not a flood) for any indelible prints to be left on the industry. Who knows, Kate Winslet may yet wear a Ritu Beri to the Oscar night! Read more

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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HOLD ON, NO DAMN ACCELERATION

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It’s not just about the upcoming Honda Jazz launch (more of that later), as apart from taking the Honda Civic Hybrid off the retail showrooms and launching the all new Accord V6, the company has announced some major production cuts to ensure its smooth drive in the country. When questioned by 4Ps B&M, Masahiro Takedagawa, President and CEO, Honda SIEL Cars India Pvt Ltd, shares, “In the past 60 years, we have witnessed a lot of ups and downs in the global market. And we are all geared to strategically outdo the current slump. We are aiming for lean operations and we have already adjusted our productions.” The company has put the opening of its second plant at Tapukara, Rajasthan indefinitely on hold. Even the current facility at Greater Noida will be operating at a single shift till the end of June rather than two shifts and hence will produce only 200 units a day rather than at a full capacity of 385 units a day. And if the speculations are to be believed, then Honda SIEL is also looking at diversifying into the boat manufacturing business with a motive of de-risking its automotive business like its rival Mahindra & Mahindra.

Notably, the launch of the new Honda city was the main reason behind the success of Honda in this period of downturn. Takedagawa is quite upbeat when he tells us something we already know, “Since last November, when we launched the generation-next model of Honda City, our sales are gradually picking up.” But what gave us a surprise was his frank acceptance of his own target market segmentation being zero-recession proof, “We are focusing more on the so-called premium segment who are quite connected to the global economy.”

Is that why Takedagawa is moving towards what is now known as the ‘Swift’ segment (after Maruti’s unfathomable monopoly in that segment) with the launch of the Jazz? Yes, the launch of Jazz is one bet that Honda is extremely nerved up about. Though Honda is one of the strongest in the sedan segment, the nerves are tensed up because of the heat of the competition Honda is facing of late.

We have already witnessed the launch of Fiat Linea and Skoda Superb’s latest model in the country competing with the Honda City and Honda Accord respectively. Auto expert Murad Ali Baig adds further, “The sedan segment will only get competitive in the coming times making the environment more competitive for Honda.” Given this, can Jazz be a runaway success just because it has got great sales support, a new design and costs around Rs.5.5 lakhs? Uhh, there lies the problem. One cannot assure Jazz’s success in the Indian market blindfolded as this hatchback will face a stiff competition from Skoda Fabia and the recently launched Hyundai i20. Worse, where the Swift rules, the Swift, umm, rules!

With the depreciation of the Indian rupee ensuring that Honda’s input costs have increased manifold (25% of their components are imported), Honda cannot simply ‘hope’ their cars will sell, especially when the competition is Maruti, which is a company that has not been known to take any prisoners. What it requires now for Honda is to understand that in India, if marketing has to work, then what also works is understanding that the Indian customer responds completely different in buying behaviour within different segments. That means that the strategies that they used to sell their Citys, Civics and Accords may definitely not get the ‘rice paddy’ home on time this time. By the way, Honda means rice paddy in Japanese. No, the coke and the junk food have not given us a high yet. And yes, we’re still waiting for the Warren effect to hit us (sleep eating junk food, wake up a rich man...).

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Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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You post it, they own it! Serious!!!

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This speculation that the site (launched by college-goers, but now turned profit-lovers) would sell user data to third parties or would incorporate users’ words or images in commercial material led to an uprising that forced Zuckerberg to apologise within a week of the change in terms event. Currently, Facebook is working on revision the above stated terms (through user feedback, it claims), but how far will the real ‘implications’ be altered? Now that is questionable!

The latest Facebook controversy has prompted social networking lovers to scrutinize user policies of other social networking sites too, like Twitter, YouTube and MySpace. Twitter Claims no intellectual property rights over the material users provide and does not retain copies of deleted messages too. The Google-owned video-sharing service, YouTube says “you retain all your ownership rights.” YouTube retains copies of videos for a certain period of time after they are removed, but promises not to “display, distribute, or perform” deleted videos. In MySpace users “continue to retain” their rights subject to a “limited license” that gives MySpace the right to display and distribute it on MySpace, but the site also allows users to permanently delete content from their account.

Whatever Facebook does hereon matters little. It is already a hit in the social circles and will continue garnering revenues and enjoying a growing flock of visitors. But one warning has just been publicised here – social networking sites are certainly not personal diaries!

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Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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DDarn! They’ve DDone it again!

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When I meet B. S. Lali, CEO, Prasar Bharati (a state run holding company looking after the operations of Doordarshan and All India Radio), the first impression he gives me is of an extremely shrewd and intelligent strategist – a commodity rarer in government departments than Stephen Covey’s management manual. Lali surprisingly gives a cryptic response to my query on DD’s stupendous current leadership, “India is a diverse country and we want to cater to that diversity keeping the integrity of the nation intact through our programmes. We put forward information, education, and entertainment along with the former two.” Patriotic answer? Yes! But the reason for DD’s leadership? Umm...

Though the figures are all but undeniable. The reach of DD is un

Though the figures are all but undeniable. The reach of DD is unmatched, as per the AMap report. Out of the 112 million TV households in India, 68 million (60%) are cable homes possessing access to satellite. The remaining 40% (Non Cable & Satellite) receive only Doordarshan terrestrially. DD also has its own DTH service called DD Direct Plus, which is free of charge and through various channels is expanding its reach. Seeing consternation, Lali reveals more, “We have been constantly innovating our contents, ways of presentation; we’ve hired new anchors et al to gain back the audience. Moreover, we are constantly working on the contents of our programmes with new subjects and good producers.” DD has begun gaining ground at prime time throughout the week, despite direct competition from a whole array of popular shows on other GECs. The most effective shows in its artilleries are Air Hostess, Kashmakash Zindagi Ki and Kisiki Nazar Na Lage, which have ripped the pants of competitors.

By airing programmes according to the audience taste, even viewership ratings are rocking, though Lali is dismissive about TRPs, and sarcastically says that they misguide advertising clients, “A TRP meter does not exist in any of the six lakh villages or six thousand blocks or in most of the six hundred districts of the nation. TRP is primarily driven by the amount of business that can be generated for the advertisers,” and not vice versa! And are prospective advertisers influenced by the ‘new’ DD? “DD, with its current programmes and unmatched reach, is definitely a good proposition for advertisers,” confirms an energetic Aditi Mishra, General Manager, Lodestar Universal!

Evidently, DD seems to have found its groove again, and frankly speaking, it’s purely because someone up there had the sense to change back to the standard strategy of presenting ‘interesting’ programmes with ‘attractive’ presenters. God, if only Air India also realises this sooner than later... And hey, just for information, Krishi Darshan is in its 43rd smashing year of running, and is shown everyday at 6.30 pm (right before the super shows of Sanskrit Samachar and Yog Vigyan!!!)... On second thoughts, I seriously hope TAM got it right... Never mind...

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Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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“We want to be a billion dollar business in India”

The great Indian IT dream has surely taken a hit post the Satyam fiasco; but Adobe India remains optimistic about its ambitious plans. The top gun reasons...

4Ps B&M: Explain the corporate governance measures that are taken care of at Adobe India?
NG: We are one of the most ethical business houses not only in India but across the globe. We have all the practices and policies in place to ensure a clean business. However, I can’t comment on a particular policy but I can assure you that we follow everything that the law requires us to follow.

4Ps B&M: In an interview, Shantanu Narayen, President and CEO of Adobe had said, Internet and Mobile are the next frontiers for Adobe? So by when do you plan to launch it on all your devices?
NG: Yes, but we don’t generally give dates. We are working on our plans. Over the coming years, you will see more and more of Adobe’s AIR platform on multiple devices. In fact, recently we have launched an open screen project which opens up some of the Adobe’s core technologies. We are also working on to develop applications that can work on various devices.

4Ps B&M: So, do you have any competition at all?
NG: There are companies which give competition to us in various parts but there aren’t many companies which compete with us head-to-head or face on. Microsoft has Silverline Technologies and that’s fitted against Flash platform. Google has some technologies which try to achieve, what we achieve with Flash and AIR. So, Google has the potential. But, we have been in business for a long time and as such have more developers and more content than anybody else in the world.

4Ps B&M: Google has been able to take on Microsoft in some areas. If you think Google has the potential, do you think you should be taking them as lightly as you seem to be taking them?
NG: We don’t take any of our competitors lightly but keeping in mind that Google is also a great partner (we will also be distributing their Google toolbar with our products) we don’t have reasons to fear. But yes, we have to be careful about all our multiple projects. It’s that actually almost all the companies can’t claim Google and Microsoft to be their competitors and still be in the business. At the end of the day, we don’t compete with Google directly.

4Ps B&M: But since AIR is the future for Adobe, and if Google comes out with a technology like AIR. Do you think you can stop them?
NG: If we compete with Google, it will not be head on, as our business model is very different from Google’s. While Google makes money by getting content and then distributing this content and information to third parties, we make money by providing tools and technologies to people. So, there are more opportunities in entering partnership with Google rather than competing with them.

4Ps B&M: What about getting ads, does it fit in your business model somewhere?
NG: That’s a very interesting area and we are working on it. We have already run a pilot with Yahoo! last year. It was aimed at inserting ads into a PDF document. So, it is pretty attractive to us as we have a high reach. Our products are available on almost each and every system in place on earth. So, it gives us an independence of putting forward right kind of ads to the user. And if we can do that in a way that adds value to the advertiser, publisher and user, there is surely an opportunity for Adobe to build its business.

4Ps B&M: What is your dream for Adobe India?
NG: Our ultimate goal is to create a business in India for Adobe. And if it can be a billion dollar business, it will be a great achievement. That’s actually harder done than said as there are not many billion dollar software businesses globally.

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Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Death knell for PRICE WATERHOUSE?

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The Satyam debacle and the spectacular failure of Price Waterhouse to detect the scam has many worried in India Inc. After all, the audit firm is considered to be one of the global Big Four and is the auditor for 46 out of the BSE 500 firms. Some of the well known companies whose accounts are audited by Price Waterhouse are Moser Baer, Max India, Maruti Suzuki, NDTV, HCL Technologies, United Breweries, NIIT, TV Today, Marico, Kesoram Industries and GMR Infrastructure to name just a few. Big time names like Vijay Mallya, Kumarmanglam Birla, Deepak Puri, Pronnoy Roy and Shiv Nadar could face embarrassment because Price Waterhouse audits their firms and everything about the firm is now under suspicion.

Take just one example of GMR Infrastructure to see how otherwise normal entries on books start looking suspicious. In the quarter ending June, 2008, GMR reported a revenue of Rs.885 crore. In the same period, it reported ‘General and Administrative Expenses’ of Rs.71 crore and fuel consumption of Rs.384 crore. In the next quarter ending September, 2008, revenues declined marginally by about Rs.40 crore to Rs.846 crore. And yet, admin expenses went up by Rs.9 crore and fuel consumption declined by a whopping Rs.111 crore. It does appear suspicious, doesn’t it? Incidentally, the former Cabinet Secretary of India (no less) T. R. Prasad has resigned from the board of GMR after he was de facto sacked from the Satyam board. There are credible reports that Prasad is likely to be questioned as investigators unravel the scam. Who knows what skeletons will tumble out then? But one thing is for sure: his future as an ‘independent’ director is as dead as a dodo.

Yet another individual whose career as an entrepreneur might turn out to be short lived because of the scam is Teja Raju, the son of Ramalinga Raju who runs Maytas. Like Satyam, Maytas (Satyam spelt backwards) has seen a meteoric rise and has bagged projects in excess of Rs.10,000 crore in a short span of time. That includes the prestigious Hyderabad Metro project. But there are clear indications that Maytas is inextricably linked with the Satyam scam and it does appear to be a matter of time before Maytas also unravels, as fresh skeletons are dug out by investigators.

But the most telling taint has fallen undoubtedly on Price Waterhouse whose future looks to be in peril. Of course, add the name of the guru and master of good ‘corporate governance’ and Harvard professor Krishna Palepu who earned about Rs.3 crore as an independent director and ‘consultant’ in governance to Satyam. Talk about delicious ironies!

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Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Now Penny-wise isn’t Pound-foolish

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Even before the slowdown hit Indian shores, marketing honchos of India Inc. had devised a new strategy to save their dimes in advertising. Companies like LG, Britannia, Maruti, Suzlon et al went dizzy with their maniacal urge to air one corporate ad after the next. The idea was simple. Rather than talking about individual brands the plan was to bring out a slightly longer ad that showcases all the well-known brands that they offer. Besides, it also helped them make star-studded statements about their corporate identity. In hindsight, the move enabled companies to save on precious air-time that they would have spent in talking about individual products/brands. This is what we call getting wise… penny wise!

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Pepsi-BBDO Break-up

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After an association of nearly 50 years, Pepsi has ended its relations with its ad agency BBDO in the US. TBWA is the new agency to handle the account. The company offered that it wants to revamp its brand communication across multiple touch points. Thus it decided to shift the agency to infuse a fresh thinking into the brand Pepsi.Losing Pepsi is surely a blow to BBDO. As per Advertising Age's 100 Leading National Advertisers report PepsiCo spent $162 million on brand Pepsi in 2007. Now that surely is a big blow, especially in the recession times when business is already low.

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Gambling may be almost an indecent

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When the oil shock first reverberated across the globe in the 1970s, the Detroit duo refused to change, in the fond hope that green will be the colour of envy for rival Japanese auto majors. But today, when Toyota and Honda lovingly brandish their nimbler, fuel-efficient machines at the American consumers, it’s GM and Ford that are not just going green with envy but are literally gasping for survival! To avoid falling into a similar trap, the impulse of going ‘green’ is running faster than blood in India Inc.’s veins. From IT giants to luxurious hotel chains, from automobiles to mutual funds, corporate India is moving fanatically ahead with green initiatives. But will the gamble eventually pay off? Deepak R. Patra digs in...

Gambling may be almost an indecent (well, we said almost, didn’t we!) word in civil society but the green gamble is one that companies globally and in India are almost being coerced into. Cautiously watching and gauging their every activity are not just environmentalists and governments, but also a fast-growing breed of aware consumers who are ostensibly choosing the natural colour over their made-up counterparts. But hey, do consumers, really care as much? Go talk to modern consumers; they are sensitive, they understand responsibility toward environment, are concerned about climate change and want to help protect the earth from effects of global warming. Indeed, a 2007 global McKinsey survey of 7,751 people in Brazil, Canada, China, France, Germany, India, the United Kingdom, and the United States suggested that 87% of consumers surveyed worry about the environmental and social impact of the products they buy. Encouraging news for India Inc.! But, at the time of actual buying, there appears a mismatch between words and actions. As per the 4Ps B&M and ICMR survey conducted across five big Indian cities – Delhi, Mumbai, Kolkata, Chennai and Bangalore (see pages 70), merely 32% of consumers surveyed had actually bought/or were willing to buy only those products that are marketed as ‘green products’. Even the aforementioned McKinsey survey concluded that no more than 33% of the consumers in their survey were ready to buy green products or have already done so. And possibly then also, they may only be buying organic foods (for personal health) or energy-efficient lighting (of course, that helps them reduce their electricity bill!).

However, more than a few contrarian instances prevail. The green gamble has already paid GE’s Jeff Immelt more than billions of dollars in revenues from his Ecomagination initiative; WalMart’s 2008 report on consumer behaviour reported a 66% increase since last year in consumers’ decisions to purchase five key eco-friendly products viz. CFL bulbs, organic milk and baby food, extended-life paper products, et al. Clearly for WalMart’s 200 million consumers, environment reigns high even in their shopping baskets.

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Why Are Masscom Students Such Misfits In Ad-Land?!

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Monojit Lahiri probes this disturbing issue

They were the kids who were supposed to be the saviours of the attrition-hit adbiz; the god-sent answers to the galloping exodus of good people suddenly upping and leaving; the bright main-hoon-na brigade all charged to fill in the blanks rendered by the defectors… but guess what? Eight times out of ten, they’ve turned up turnips; well-meaning disasters who didn’t seem to have a clue about the ‘real’ world! Agency and clients continue to crib about these kids “coming from another planet and totally out-of-sync with the ground realities that govern our business.” Shouldn’t the faculty and powers-that-are initiate them into what awaits them once they are out in the battlefield? Isn’t it their responsibility to get them as industry-ready and friendly as possible?

“Actually, its one of the great tragedies of our education system that we pay a pittance to teachers, compared to people in other disciplines in other sectors. Hence the institutes – exceptions apart – attract a lot who have practically no industry experience or people who are not good enough to be absorbed in the mainstream and find it convenient to hide out as faculty in these joints.” That was Santosh Desai, the high-profile CEO of Future Brands. He is of the firm opinion that communication is a far richer, purer discipline than marketing [which borrows heavily from other empirical sciences] and at best is nothing more than a makeshift science. “The atmosphere and environment – for example – that prevails in an advertising agency with its unique work culture, demands and expectations is an entire universe apart from a traditional, conventional workplace. The result is, frequently, there is zero-connect and near non-existent value-addition. For example, Advertising being an idea-led business, is there any focus regarding the critical aspect of how to form, shape, add value, reject or react to an idea?”

Motorola’s dynamic and articulate Marketing Director, Lloyd Mathias is up next. He believes that most traditional Masscom Institutes in the country, unfortunately, choose to be [comfortably] inward looking, still concentrating on old Case Studies from Harvard Business School. “In today’s day and age, this is totally irrelevant! They need to understand that if the kids have to go out and work in an Indian environment they ‘must’ necessarily connect with the Indian reality.” Mathias then goes on to make a strong case for the biggies, the movers n’ shakers – Omnicom, WPP, Publicis – to get together and arrive at a common solution where an environment/climate is created to allow for a more enlightened faculty and sharper, industry-friendly student community.

The new Golden Boy of Indian Advertising [the soft-spoken, low-profile Agnello Dias, JWT’s NCD, whose amazing Lead India campaign fetched India her first-ever Grand Prix at the recently concluded Cannes Ad fest] adds his own evolved input. He believes that Masscom – as a discipline – is a fluid science and has to be understood in that vein, from day one, by everyone engaged with it. “The problem with most schools and institutes is that the curriculum and syllabi seldom bears any connect with the present or future … it seems to be entrenched firmly in the past! The result is that while the jargons, terminology and catch-phrases are picked up, nothing that is truly relevant is. Why? Because even between the time they’ve done the exams, got their results and started looking out for jobs, the dynamics of the business could’ve changed … and where would that lead them?” Ivan Arthur, veteran, creative, heavyweight of JWT in the sixties, seventies and eighties rounds off this debate on a truly positive and meaningful note, offering solutions that everybody [including these distinguished practitioners] are looking out for. He points towards Walter Saldhana’s Aicar Business School in Neral, Maharashtra. Its an institute, which is pragmatic, rooted to ground realities, living in the here and now. It promotes learning-by-doing as its defining philosophy. “We set up an integrated communication agency in the campus that actually handle live accounts. Students are taught the processes and costs of acquiring and managing accounts. They also have to learn the pain of losing some of them. Clients pay the institute for the work done by students, of course with close and active supervision of the faculty and mentors, all experienced ad professionals. Clients include names like Eureka Forbes, IMS Learning, Old Spice, IL&FS and Aicar B-School itself. The practical experience is supported by robust classroom sessions, which deal with diverse subjects … world literature and mythology, aesthetics, semiotics and cultural anthropology. We believe that beyond being effective managers, they should be well-rounded human beings with those softer edges of refinement and sensitivity.”

Are you listening Santosh, Lloyd, Aggi and everyone out there?

Way to go, guys…!

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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If India has its brands, China has its infrastructural-prowess

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During a recent leisurely sojourn in Egypt, I was in no mood to roam around, suppressing my marauding instincts. However, as Cairo basked in the pleasantries of the Mediterranean Sun, I decided to give in to my vagaries of exploration. Already satisfied with the Egyptian heritage, the next stop was glitzy downtown Cairo and what better place to start than ‘The Omaha Endi Mall’, one of the most happening places around. Inside, I was greeted by the usual upmarket brands galore, but what surprised me was an unusual sight. In the middle of this brand hoopla, there was Lilliput, an Indian kids wear brand. With a conceited yet anxious mindset, I entered the corridors of the spanking showroom oozing those world class lines. As I waited there in awe, a mother and her three kids entered the shop and I could not help but ask their perception of Indian brands. “Well, I like the quality and clear cut fashion of the Made-in-India labels, Chinese brands are there too, but not that good to feel and wear,” said the prospective customer. This was no innocent answer to a direct question; it symbolised the choices of the African consumer and the power of Indian brand names.

Back home, the first thing I did was to meet the Egyptian Ambassador to enquire about the inside story behind the success of the Indian brands among Egyptian consumers. “If you consider India particularly, then India and Egypt have a strong link even thousands of years ago and this cultural legacy has helped Egypt become unique for India,” averred H. E. Dr. Mohamed Higazy, the Egyptian Ambassador to India. My curiosity awakened, I couldn’t restrict the story to India. Stealthily old neighbour China had found a place!

The first obvious question is that is the time really ripe to enter the so called ‘Dark Continent’? Traditionally, businesses in Africa have behaved like ‘caterpillars’ – uninteresting, slow moving and easy to step on. Conditions are still somewhat similar, but change is creeping in fast. “The place is still financially challenged, but it’s no doubt one of the hottest markets today. We had been in Africa for 10 years now and it’s definitely the next big market,” asserts Rajendra S. Pawar, Chairman, NIIT Technologies. Pawar is not alone. There are many of his ilk who feel that the continent has not only seen daylight, but that the sun is shining brighter each day. “Even Sub-Saharan countries are clocking growth rates of over 7% in the past years. Per capita income is also increasing. The time is ripe for Indian firms to invest in Africa,” adds V. Thatty, Deputy GM, International Operations, Bank of Baroda (the bank operates in Africa through a subsidiary arrangement). Some, however, are treading more cautiously. “The main problem we see is the lack of regulatory infrastructure in most African countries,” says Rahul Virkar, Spokesperson, ICICI Bank (International Operations). “We at present have our representative office in South Africa but in the near future,” he adds optimistically, “we may go for a wholly owned subsidiary there.”

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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BINGEING IN BAD TIMES

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The downfall of global financial stalwarts like Lehman and Morgan Stanley have also unleashed a somewhat similar story for India’s darling ICICI (with malicious rumors playing their own part in the saga). Correspondingly, consumer confidence has also taken a dip (albeit slight!). Given the unfolding situation, analysts expect a tightening in the corporate spend for at least two quarters. An ICICI official, on conditions of anonymity, told this magazine that “In order to maintain the bottom line, it is prudent for the corporate (ICICI) to cut their expenses. Hence, cost cuts are happening through various alternatives and ad expense is a part of those alternatives.”

As a matter of fact, while it is prudent to curtail costs, corporate should look at the returns of ad spends in terms of top line and compare it to the costs of business losses if the marketing spends were not done to arrive at an alignment. Well there are few who do not buy this logic, for them it is not merely revenue but legacy which matters. A Coke spokesperson told 4Ps B&M, “In Coca-Cola we don’t exactly design every ad keeping in mind how much revenue it will generate as our policy is to sustain the legacy of the brand by promoting it through ads. So the exact ad expenditure is not necessarily directly linked to revenue.”

His words ring true, specially given the fact that even global experts have now started recommending more advertising during recession time, so that the brand makes the most of it when the economy recovers. For now, the only guys who seem to be in the safe zone are the (evergreen?) FMCG and (sunrise!) telecom sectors. As opposed to last year, FMCG major HUL increased its ad spend by 11.78% and correspondingly its sales improved by 13.24%. Similarly Dabur India improved its sales by 29.64% after increasing ad spends by 25.55%. Telecom major Bharti leads the list of the telecom players which increased its ad expenses by 40% and witnessed a 44% growth in its sales figure.

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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White goods: A chimera?

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With perishables, FMCG and apparel markets already under their thumb, desi retailers have now begun to eye private labels even in high involvement categories like white goods. Analysts feel that creating a private label that would give sleepless nights to the market leaders in the category is difficult. The complication grows bigger because consumer durable majors (or at least some of them) are even setting up own retail outlets to sell their wares (Videocon has a target of $3billion turnover by 2013 from its retail venture). But does that mean that RPG Cellucom, which has created its own handset brand and Reliance Digital, which is planning similar, can never stand at the heel of LG, Samsung, Whirlpool and several of their ilk? Of course, creating a brand from scratch is relatively difficult for new-entrant retailers than is for let’s say Videocon, but “if priced low, boasting equivalent features and supported by excellent promotion, retailers can even grab market share from these players,” feels Paul Martin, Global Sales Manager, Planet Retail, UK.

In fact, analysts are raving about the Reliance way of creating private labels. Over the past two months, Raghu Pillai, President, Retail Operations & Strategy of Reliance Retail, has had his hands full putting in place some more hyper-marts, launching at least one private label across segments. “That’s going to match with the local taste or preferences, whichever community we are entering,” adds Pillai. Rising on the wave, yesteryears TV brand Salora is geared for a comeback. Having their own manufacturing hub enabled them to make LCD TVs and when they launched their retail arm - Terminal - in 2008, they promoted these as in-house brands. The chain is set to expand to 350 stores and is setting up sturdy distribution channels. But are people buying Salora LCDs, specially when Sony is also present in Terminal? “Yes! Our brand is priced lower than Sony and we offer same features and after sales service,” avers Sanjive Sethi, CEO, Salora Retail.

“The more developed and consolidated a market, the higher the penetration of private labels. Switzerland is the market, where private label dominates,” announces Martin and he believes that the more organised retail spreads in India, chances of in-store brands emerging as big brands get higher. Definitely a sunny indicator for Biyani, Ambani & Company. Reliance laptops and Future DVD players are still to see the light of the day, but the corporate retailer has begun to flex his muscles. The NCAER Report may have given organised retail a clean chit so far as millions of mom & pop stores are concerned, but HUL, P&G, Samsung, Raymonds, Levis, LG... you better watch your backs! The journey has only just begun.

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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When IIPM comes to education, never compromise
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Arrogance has killed many American brands… They once basked in their own pride, but today lie in coffins gifted by new-age brands.

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Walk up to a teenage coffee lover and ask him if the word ‘Brim’ strikes a familiar note. Don’t be surprised though if he gives you a wrinkled ‘what a weirdo!’ look. How on earth would he know what ‘Brim’ is?! Its ads had stopped flooding media machines decades back and the brand itself has been jettisoned from retailing ships for much over a long decade! Dead… and its memories just a ghost from the past! Move onto something cold – call it ‘Tab’. Remember the name? Don’t worry if you can’t, for it’s another one from the morgue. Tab was the predecessor of Coca-Cola’s current Diet Coke, but with time and lack of innovation in taste, it began to fizzle out. At present, the Tab formula lies inert in Coca-Cola’s labs, waiting for an American re-branding miracle...

These were just two ‘glorified’ brands which once basked in the American sun of glory, and were all set to capture global centre-stage. They lost their hue partly for lack of innovation and primarily because they were just too arrogant and obstinate to change, as Jeff Kagan, Telecom industry expert asserts, “American brands need to keep competitive threats in mind. Once successful American brands can stumble. They need to reinvent themselves...” What follows is an account of a few such ‘once great arrogant’ American brands that suffered from the very two reasons mentioned above, and are dying today.

Levi’s, which once ‘proudly’ swore to clothe the world with denim is a mirror image of what it was 24 years back when Robert Haas bought an almost dead brand and closed dozens of production units and subsidiaries, and brought the organisational ‘core’ focus back. Having taken the company semi-private a year later, he infused new life into the brand. Levi’s was a known brand again and its stock price was kicking, having risen from a mere $2.53 to a swashbuckling $265 in just a year! But with time, and for lack of consumer focus and customisation (its ‘One size fits all’ strategy), revenues and profits for the brand is drying quarter after quarter as a spokesperson confesses, “The mistake we made was to make one brand for everyone – it ended up being nothing to anyone.” In the past eleven years, the company has given the royal kick to 17,350 employees (including its CEO in 2007) and has put the locks on 33 factories across North America and Europe. What growth! So what led to this dangerous situation? While companies which focused on maximising wealth – like Honda, GE, Toyota, Unilever et al – rushed to low-cost Asia, Levi’s put it’s foot down to manufacturing products in America. It was too proud to allow its products to be manufactured in Third World geographies!!!

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Programme :- SUPERIOR COURSE CONTENTS
Now IIPM's World-Class Education... for everybody!!
IIPM INTERNATIONAL - NEW DELHI, GURGAON & NOIDA
IIPM - Admission Procedure
IIPM, GURGAON
IIPM : EXECUTIVE EDUCATION
IIPM’s 36th Glorious Year of Academic Excellence
4Ps Power Brand Awards 2007
Why Study Abroad When IIPM Gives You 3 global Advantages!
IIPM Ranked No. 1 B-School In Global Exposre - Zee...