Brand Update : Colgate

Colgate celebrates October as Oral Health Month. This is a unique example of a brand embarking on strong value system. Colgate has long been positioned on the oral hygiene platform. Strong teeth and prevention of tooth decay has been the main communication points of this brand. To further reinforce this positioning and also to demonstrate the brand's commitment towards society Colgate observes October as the oral health month.

This initiative was started in October 2004 and has grown in size and depth. Now this initiative covers 175 cities across 19 states and touches 250 rural areas across the length and breadth of India. During this month, the brand organizes free dental camps for oral checkups. Colgate also sponsors various initiatives to educate the masses about proper oral hygiene.
This year Colgate further expanded the scope of this initiative by an attempt to touch the young urban audience . Colgate for the first time tried an animated viral campaign aimed at youngsters. The brand uses a fictional plot involving a dangerous new species Germosaurus which evolved from the germs that causes tooth decay.
Watch the campaign here : Germosaurus
Whether the new campaign had the desired effect or not, one has to appreciate a brand to take up a worthy cause.
Colgate has set a grand vision for itself. The mission aims at ZERO tooth decay. The brand is trying to promote this vision through various initiatives in partnership with Indian Dental Association. This is a variant of cause marketing. Cause marketing is defined as the process of formulating and implementing marketing activities that are characterized by an offer from the firm to contribute a specific amount to a designated cause when customers engage in revenue providing exchanges that satisfy organizational and individual objectives. Another jargon to define this initiative is Corporate Societal marketing. I call it a variant because a customer does not have to buy Colgate inorder for the brand to conduct these programs.
Such initiatives of brand offer many potential benefits:
a. Building brand awareness
b. Enhancing brand image
c.Establishing brand credibility
d.Evoking brand feelings
e. Creating a sense of brand community
f. Eliciting brand engagement
g. Humanizing the firm.
( Source : Strategic Brand Management by Kevin Lane Keller)

Colgate has been a consistent topper in the Brand Rankings throughout the world. The reason behind a brand sustaining its world leadership position is that it had identified a much nobler cause than the usual market share numbers.
Its a lesson for all marketers to learn....... Do your brand have a vision for the society ?

Market Statistics : India's most valuable brands

In 2006, Brand Finance -a global brand consulting firm had ranked India's most valuable brands. The list and the trademark value is given below

Brand Trademark: Value in Millions ( Rs)

Indian Oil Corporation : 250,636
State Bank of India : 137,965
BPCL : 134,673
TCS : 123,485
Reliance Industries : 122,240
HPCL : 116,271
ONGC : 88,822
Tata Motors : 84,652
ICICI Bank : 76,777
Wipro : 67,681
ITC : 64,406
Infosys Technologies : 63,534
GAIL : 58,178
Bharathi Televentures : 54,018
Tata Steel : 44,059
Larsen & Tubro : 39,658
Ranbaxy : 29,038
Bajaj Auto : 27,186
Satyam : 24,302
Hero Honda : 20,580
IDBI : 18,830
HDFC : 14,665
HDFC Bank : 11,992
Jet Airways : 10,410
Grasim Industries : 8,003

The valuaton might seem confusing since major FMCG brands are not visible in the brand league. This is because holding companies of branded products like HUL is excluded and also only those companies which are listed in BSE is taken for this valuation. The valuation also excludes those companies where information is not clear ( read Pepsi and Coke). The valuation also excludes new companies which has not made it to BSE top 500 by market capitalization.
Hence I would say that the above list is India's most valuable corporate brands.
Another interesting facet of this study is the methodology. Brand Finance uses the technique called Royalty Relief Approach. The method simply assumes that the brand is not owned by the respective company and how much the company has to pay inorder to license the brand from a third party. The hypothetical stream of such royalty payments becomes the brand value.
The critical factor is the assessment of the Royalty rates which is usually judgemental and also by comparing with the going rates at similar deals. The royalty rates are usually expressed as a percentage of sales.
According to reports, Royalty Relief Method is the single most reliable brand valuation technique used worldwide.

Its true that no calculations have so far yielded perfect valuations to the brand. The reason is simple, a brand's value exists in the mind of the consumer. Its intangible and to put a value to intangibles makes it the most inaccurate number.

Source : businessindia,rediff,brandfinance ,businessline

Future TV : Media Where it Matters Most

Move away TAM, Move away SEC, Move Away Saas Bahu and Woh, media will never be the same again. There is something now media planners across the country will be watching : the emergence of a new media : In-store media.

This year Kishore Biyani's Future Group kickstarted a new division Future Media which is its aggressive foray into In-store Media. The division which integrates all instore media within the retail formats of the Future Group. The division expects to rake in Rs 200 crore as the non retail revenue for the group.
Future TV is the in-store electronic media offering airtime to the advertisers. The network consists of numerous TV's placed in strategic locations throughout the stores. The concept of in-store TV was pioneered by WalMart. WalMart TV Network which began operation in 1997 is the largest TV Network in US reaching a whopping 127 Million Shoppers. WalMart TV Network is shown in 1,25,000 screens spread across 3100 US Stores.

Future TV is following the same way as WalMart TV and is set to create a trend in the development of this new media.
There is lot of impact of this media over the traditional media like Print and TV. In-store media reached TARGET CONSUMER while traditional media reaches the TARGET AUDIENCE. Future Media uses this beautiful phrase to capture the essence of this media " This media is trying to convert / influence customers in the ambiance of consumption ". Its reaching the customers while shopping compared to reaching the customers while sitting on the couch. That's real targeting. The impact of this media is huge given the fact that most of the purchases (FMCG) in supermarkets are impulse. So catch them with their wallets open !!!!!

For a brand manager, this new media offers yet another opportunity and also more complication. The media again gets fragmented. But its also an opportunity because the reach is more precise. Also for products that need more explanations, in-store electronic media is a boon . For example, in US , Listerine uses WALMART TV effectively since the customers needs to be taught how to use this brand effectively.
For the mediaplanners, once this kind of In-store media become popular, its going to be tough task to allocate the budget. New models of understanding the influence of this kind of media needs to be created.
For the creatives , the task is to make the communication appropriate . In-store ads need more creative juice since it is reaching the customer at the point of sale. The ad is not for building the brand but to make the sale.
For the media owners like Future Media , the challenge is to make this media less annoying for the customer. WalMart TV faced an issue where the customers complained that the screens are put way too above their eyelevel thereby causing inconvenience. WalMart later changed the entire design to keep the screen at convenient eye level. Another challenge is to make the content interesting to the customer. According to reports, a customer spends 6-7 minutes watching WalMart TV. So the task is to get their eyeballs along with the wallet.
For media analysts and academicians, some serious rethinking on concepts like reach , frequency, media effectiveness measurements needs to be done.

Will in-store TVs kill ordinary TV advertising ? No, but its definitely a competition for the traditional media. In-store media acts as a complimentary media for brand managers. I think that in future, traditional media will be used for brand building while in-store TV will be used for sales promotion ( the trend is already there).
In-store media can be defined as all media opportunities available to an advertiser within the retail store. Other than TV, In-store media offers other media formats also like
Kiosks
Staircases
Carrybags
Elevators
Pillars
Trolley
Dropdowns
Shelf branding
Traditional POP's
Banners and what not....
Future Media is now in the process of rolling out Future Radio.
In-store media is in its infancy now in India. The media will grow only with the growth of large retail networks like Big Bazaar. The advertisers will look at this media seriously once it acquires the critical mass.
source : futuremedia.in , financial express,agencyfaqs.

Marketing Funda : Brand Rituals

A Ritual is defined as the combination of rites and rite is defined as a ceremonial act. According to BBDO rituals are defined series of actions that move people emotionally from one place to another.Rituals are sequences that are developed over time. Rituals are usually used in religion. We perform many religious rituals and some of these becomes an integral part of our life.

Brand ritual is the performance of an act by the consumers as defined by the brand ( Owners). These days brand rituals are a common strategy adopted by marketers. Some rituals become a part of our behavior over time.
A classic case of such a ritual is the checking of breath . The Ha Ha which we do with our hand was taught by Close- Up. The ritual in breaking the Kit Kat wafers is another successful brand ritual.
A global brand known for the ritual is that of Corona beer, the beer is to be taken through a lime kept at the neck of the bottle. Another famous one is the James Bond induced ritual for Martini " Shaken not Stirred" .
Not all brand rituals are successful. Munch is trying to recreate the success of Kit Kat with no success. Horlicks is also trying out a similar Hip rotating ritual.The latest Pepsi My Can also features a special way of holding the can which can be termed as a ritual.
Rituals are used as a brand element because of its stickiness effect. A popular brand ritual can make the customer remember the brand and stick to it. The ritual also involves the customer with the brand. It also creates a pattern in the consumer's mind which can trigger loyalty.

Another important advantage of brand rituals is that it acts as a differentiator. When product features become standardized, marketers look for non feature differentiation. Brand rituals often differentiates the products from the rest.

Marketers has to be careful while creating brand rituals. Some important guidelines for an effective brand ritual are given below:
Brand rituals should be

Simple : Complex rituals are failure for sure. Consumers should be able to do the ritual easily.
Relevant : Although this is not a rule, rituals will work better if its relevant to the brand.
Fun : Customers should enjoy performing the ritual.
Consistent : An important factor in the success of a ritual. Once the ritual is finalized, the marketer must ensure that there is consistency in promotion of the ritual.
Meaningful : The customers are not going to own a ritual unless it makes some sense for the customers.
If carefully created , brand rituals can be a powerful brand element. The ritual can be a double edged sword, if not created properly , the ritual can often diminish the brand's equity too.

Marketing Funda : Power Brand Strategy

Power Brands strategy was the much hyped brand strategy of Unilever's which debuted in India in 2001. The father of this strategy was Niall Fitzgerald who was the Chairman of Unilever during that period.

Mr. MS Banga, one of the youngest Chairman of HLL at that time thought it was a good strategy that can be implemented ( or imported) in India. But four years later, the entire strategy was shelved. The much hyped power brands strategy was laid to rest quietly. Fitzgerald exited Unilever and Mr. Banga moved out of HLL to become the President of Unilever's Foods Division.

What is Power brand strategy?

Power branding refers to building multi-product, Multi-category brands which have global reach. (Marketing Week Dec. 2000) . The idea behind this strategy is to build global brands which endorse multiple products in various categories ( something like an umbrella brand).

To understand the relevance of this strategy, it is important that we understand the background under which this was mooted by Fitzgerald. In 2000, the $44 bn giant Unilever was reeling under the pressure to balance Size and Growth. Over these years, the company has grown to become a behemoth which was under severe marketing attack from small agile companies. This pressure forced Unilever to relook their brand portfolio. Unilever had a whopping 1600 brands ( mind you Brands and not SKU's) across various categories. The top management thought that this many number of brands is the main reason for the lack of growth momentum.
In an interview in Advertising Age, Unilever's Chairman remarked that there were hundreds of brand which existed in the company portfolio but nobody knew Why these brands existed?

Along with that there were other issues in the global market such as

Retailer Power: Large retailers like Walmart changed the power equations in the market. The power moved from manufacturers to distributors. Retailers began to aggressively market their Private Labels. Shelf Space became scarce and Retailers began to stock only large brands.

Brand Proliferation : The huge number of brands and their extensions along with the plethora of private labels forced customers to go for economical private labels because no longer brands provided meaningful differentiation.

This paved the way for the thought that it makes sense to have a limited number of large brands which could be extended to multiple categories / product lines which would reduce the clutter in the market. Another logic was the Pareto Principle of 80/20. Twenty percent of the brands contributed 80 % revenue, hence why not spent the marketing budget on those big brands that contributed to the revenue.
The result of all these thinking was the much hyped Power Brands Strategy which was the core strategy in Niall Fitzgerald's "Path To Growth" agenda for Unilever. Under this Unilever was going to prune its brand portfolio from 1600 brand to a core 400 Power Brands.

HLL's Power Brand strategy

Taking a cue from this, Mr Banga introduced the same strategy in HLL in the year 2000. HLL was also facing growth issues at that time . Like the parent, HLL had a huge brand portfolio consisting of 110 brands and hundreds of SKU's. Competition was hotting up and HLL was struggling to retain market share in various categories.
Mr. Banga decided to rationalize the brand portfolio by concentrating on 30 Power Brands and 10 regional jewels. The company expected that with a reduced number of brands, it will be able to concentrate on the large brands with more promotional budgets.
The plan was like this :
a. Reduce the number of brands from 110 to 40. This can help in increasing operational efficiency and reduce brand clutter.
b. Increase promotions for Power brands thus offsetting the loss from the brand rationalization.
c. Migrate users from small brands to Power brands.
d. Have ambitious growth plans for Power brands ( 8-10%).

The Power brands was chosen on the basis of Size, Brand Strength, Uniqueness and Growth Potential.
But the results were disastrous. After the Power brand strategy implementation, HLL' s topline took a major hit. Profits went down by 22%. In many smaller markets, HLL 's brands were knocked out by small regional brands.

Why Power Brands failed in India?

The primary reason for failure of Power Brand strategy was that HLL miscalculated the power utility of small brands especially in the Indian context. Although there were issues of competition, Indian market was different from global markets at that point of time. Retailers were not that powerful ( compared to Europe or America) and there was no Private label competition.

The withdrawal of smaller brands was the big mistake done by HLL. Smaller brands, although did not contribute significantly to the profitability had lot of uses. It acted as flanker brands for large brands thus preempting competition. Small brands was more accepted locally and when these brands were withdrawn, HLL lost its presence in the smaller markets. The brand rationalization also pulled down the distribution because many brands piggybacked other brands in various markets. The cutdown also helped the surfacing of many regional brands which established in small markets and later grown to fight large brands from its base.
Another strategy that failed was the migration effort of Power brands. The pruning of smaller brands was initiated with the assumption that users of these brands would be migrated to power brands. This assumption failed miserably. A classic case is the failed migration effort of Rexona to Lux. The users of the smaller brands of HLL moved away from the company to brands of other companies.

These issues snowballed into a situation where HLL 's topline got affected which inturn affected the investor sentiments. As a result, HLL went in for a face saving restructuring exercise which led to the exit of Mr Banga from HLL and a silent burial of Power Brand strategy.

Book Review : Ten Deadly Marketing Sins

Book Title : Ten Deadly Marketing Sins, Signs and Solutions
Author : Philip Kotler

Publisher : Wiley India
Price : Rs 299
Pages : 152
Edition : 2006

Book Review Count : 3

A book that is a must read for all marketers, Ten Deadly Sins is a simple but a thought provoking book. Yet another masterpiece from th Marketing Guru Kotler. When you read through the first few pages, it will seem to be the repetition of marketing funda from his text. But as you move along, the importance of these concepts will slowly unfold.
This book authenticates what Dr.Kotler used to say " Marketing is easy to understand but difficult to practice". All the concepts explained in this book are very simple and some what obvious to even the uninitiated , but how often even the best companies fail to practice these ideas and concepts are quite surprising.
What Dr Kotler aims with this book is to provide the marketing practitioners a ready reckoner of marketing mistakes which they ought to introspect.
Prof.Kotler identifies the Ten deadly sins as :

1. Your Company is not sufficiently market focused and customer driven.
2. Your company does not fully understand its target customers.
3. Your company has not properly managed its relationships with its stakeholders.
4. Your company is not good at finding new opportunities.
5. Your company is not good in finding new opportunities.
   
6. Your company's marketing planning process is deficient.
7. Your company's product and service policies need tightening.
8. Your company's brand building and communication skills are weak.
9. Your company is not well organized to carry on effective and efficient marketing.
10. Your company has not made maximum use of technology.

These sins explained in ten chapters virtually covers all the pitfalls that a company faces in the marketing domain.
What I like most in this book is that the author tries to drive home the point that CUSTOMER focus is the Key to marketing success. Although this is an oft quoted Cliche , we know that some of the largest companies are myopic in their customer management.
If the renowned author and venture capitalist Mr Guy Kawasaki faces the issue of having to spent 68 minutes to cancel a service which he hadn't ordered, what will be the fate of an ordinary customer. Read the full transcript of Guy's experience here : Customer Service

After having explained the sins, Kotler went on to prescribe Ten Commandments to all marketers.He exhorts us to frame them on our walls

1. The company segments the market, chooses the best segments,and develops a strong position in each chosen segments.
2. The company maps its customers' needs,perceptions, preferences,and behavior and motivates its stakeholders to obsess about serving and satisfying the customers.
3. The company knows its major competitors and their strengths and weaknesses.
4. The company builds partners out of its stakeholders and generously rewards them.
5. The company develops systems for identifying opportunities, ranking them and choosing the best ones.
6. The company manages a marketing planning system that leads to insightful longterm and short term plans.
7. The company exercises strong control over its product and service mix.
8. The company builds strong brands by using the most cost-effective communication and promotion tools.
9. The company builds marketing leadership and a team spirit among its various departments.
10. The company adds technology that gives it a competitive advantage in the market place.

Here in this book, Mr. Kotler yet again proves that marketing is too important to be left with marketing people. In Chapter 4 he emphasis on how satisfied stakeholders can build marketing effectiveness. He asks the CEO's to manage he employees better so that at the end of it customers are better managed.
Ten Deadly Marketing Sins is for CEOs to sit with the colleagues and examine each of these deadly sins. Then determine which is the most serious and then find solutions for it. One of my favorite quotes is this " Marketing's work should not be so much about selling but about creating products that don't need selling". .... How True...

Verdict: Highly recommended.

Market Statistics : Indian White Goods Market

Refrigerator Market

Market Size : 3.75 mn (Units) . Rs 3781.92 Crore (Value )
Growth : 7.1% ( Units) 10.70% ( Value )

Direct Cool
Market Size : 2.73 mn (Units) . Rs 2239.83 Crore (Value )
Growth : 6.19% ( Volume) . 7.7% (Value)

Frost Free
Market Size : 1.02 mn (Units) . Rs 1542.09 Crore (Value )
Growth : 9.0% ( Volume) . 15.2% (Value)

Washing Machine
Market Size : 1.67 mn (Units) . Rs 1,46,803 Crore (Value )
Growth : 6.7% ( Volume) . 10.6% (Value)

Fully Automatic
Market Size :0.53 mn (Units) . Rs 727.27 Crore (Value )
Growth : 18.2% ( Volume) . 19.7% (Value)

Semi Automatic
Market Size : 1.14 mn (Units) . Rs 739.68 Crore (Value )
Growth : 3.3% ( Volume) . 3.4% (Value)

Microwave Oven
Market Size :0.63 (Units) . Rs 472.24 Crore (Value )
Growth : 49.6% ( Volume) . 39.0% (Value)

Air Conditioner
Market Size : 1.05 mn (Units) . Rs 1998.39 Crore (Value )
Growth : 51.6% ( Volume) . 49.8% (Value)

Market size according to AC Neilsen as in Jan Dec 2006 .
Source : Business World 28 May 2007

Market Statistics : Volume 4

Topical Steroid Market Size (Skin care) : Rs 100 crore Source : ET 9/6/07

Digital Camera Market Size : 7 lakh Units per annum source : ET 9/6/07

Size of Luxury Market : $ 444million Source: ET 09/06/07

Used Car Market Size : 1 million units Source : ET 09/06/07

Home Furnishing Market Size : Rs 15,000 crore Source : ET 09/06/07

Indian Soft Drinks Market size : $ 2 Billion Source: ET 09/06/07

Telecom Equipment Market Size : Rs 75000 crore Source: ET 06/06/07

Air Conditioners ( AC) Market Size : Rs 3600 crore Source :Businessline 5/4/07

Branded Home Furnishing Market Size : Rs 5000 Crore Source :Business Line 02/02/07

Indigenous Tiles Market Size : Rs 700 Crore Source : Businessline March 2007

Food & Beverages Market Size : $5640 Mn Source : AC Nielsen 2007

Shampoo Market Size : Rs 1800 crore Source : Business Standard 29/05/07

Frozen Non Vegetarian Snack Food Market Size : Rs 150 crore Source : Businessline 08/01/07

Frozen Vegetarian Snackfood Market Size ; Rs 200-250 crore Source Businessline 08/01/07

Industrial Glove Market Size : Rs 150 crore Businessline 05/05/07

Marketing Funda : India's Most Trusted Brands 2007

Economic Times has published Brand Equity's Most Trusted Brands. Colgate for the fourth year in a row topped the list. The first ten positions in the list looks like this

1.Colgate
2.Vicks
3.Lux
4.Nokia
5.Britannia
6.Dettol
7.Lifebuoy
8.Pepsodent
9.Pond's
10.Tata Tea

The top ten service brands are
1.LIC
2.Airtel
3.State Bank of India
4.Reliance India Mobile
5.BSNL
6.Tata Indicom
7.Indian oil
8.ICICI Bank
9.Bank of India
10.Reliance Petroleum

Colgate has every qualification to be in the number one league because of its ability to understand Indian consumer and innovate interms of the product and marketing mix. The brands that feature in teh list is a testimony of successful marketing.

Cheers

Marketing Funda : India's Income Pyramid

India's consumption forecast and the burgeoning Globals and Aspirers are making the marketers drool.

Source: Economic times.

The large upper strata is now encouraging lot of marketers to look at premium products.

Marketing Funda : Absurdism In Advertising

In an interesting research paper by Leopoldo, John and Gautam at Oklahoma University, Absurd Ads are defined as those which have pictures,words,visuals or sounds which the viewers perceive to be irrational, bizarre,illogical and disordered. Going by that definition, 90% of ads that we see can be classified as absurd ads.The origin of the concept of absurdity has its roots in drama and literature. According to theorists, the use of absurdity in advertising is derived from literature and drama.

There are different type of absurd ads.
a.Surrealism
b.Anthropomorphism
c.Allegory
d.Hyperbole.

Surrealism is associated with distorted images,dream imagery and imaginative worlds ( Sunfeast). While Anthropomorphism is trying to connect /explain a non-human with a human(Chintamoni of Icici?). Allegory is the description of something in the pretext of another( Hutch dog ). Hyperbole is gross exaggeration to make a point(Happydent). ( From the above authors).
What I feel is that Absurdism in Advertising is a continuum. There cannot be an ad that does not have a dash of any of the above four types.Hence we should be placing the ads somewhere in the continuum where one extreme is the absolutely absurd ads like that of Happydent and the other extreme of an ordinary ad with less absurdity like the latest print ads of SBI. So I can put a hypothesis saying that it is a choice of whether the communication should be rational or non-rational. Orbit for example chose an rational one for its main brand and an Absurd ad for its variant Orbit White.
It is interesting to look at the reasons for marketers to go in for absurdism in advertising.Primary reason is that they don't care because all these postmortem and analysis is done by academics. Marketers often create hyperbole or absolutely bizarre ads like Centershock
to

• Create excitement
• Aid Brand recall
• Change the mood of the brand
• Reposition
• Entertain the viewers
• Spent the money they have for advertising ( joking...)
• Reminder ads
• When they have nothing rational to say about the brand.
• When nothing rational works
• All positioning opportunities are taken by the competitors.

Source: EFFECTS OF ABSURDITY IN ADVERTISING: THE MODERATING ROLE OF PRODUCT CATEGORY ATTITUDE AND THE MEDIATING ROLE OF COGNITIVE RESPONSES by Leopoldo, John and Gautam

Marketing Funda : Markonyms

Markonyms is a new word to represent all acronyms that marketers create for the promotion of their brands. ( I take the title of the founder of this word).

Marketers use acronyms to impress the customers and coax them to believe that what marketers says is rocket science. Found extensively in Automobile and Tech related products, Markonyms are becoming more and more useful in consumer products also.
Given below is the first set of commonly used Markonyms with a little explanation.

1. DTSI : Digital Twin Spark Ignition : created by Bajaj for its Pulsar. Even the Pulsar owners doesn't know what it does but however, this markonym has worked wonders for the brand.

2.ZPTO: Zinc Pyrithione : created by Clinic All Clear , this markonym landed the brand into trouble but later the brand won litigations. This ingredient is said to have dandruff eliminating properties

3.MMR: Mosquito Mortality Rate : Created by All Out. Only the brand owners know the exact definition.
4. Hi-fi : Hi-Fidelity : Used by most Music player marketers. It refers to high quality music.

5. HDTV: High Definition Television : Digital Broadcasting system that offers more clarity.

6. LCD : Liquid Crystal Display : Thin Flat display technology uses little energy and also little space.
7.CRDI : Common Rail Direct Fuel Injection : Popularised by Accent. It is too technical for me to understand and explain. It is said to increase efficiency and reduce emission.

8.DICOR: Created by TATA safari : This is same as CRDI . Smart marketing move...

9. ABS: Anti Lock(Skid) Breaking System: Pioneered by luxury car like Accent ;too technical again..
10.24X7: Every one uses it and every one knew what it is .

11.MP: Mega pixel : I have seen lot of my friends going after megapixal cameras ranging from 1-8.. too technical . For more info check out WIKi


12. DHA : Docosahexaenoic Acid: Created by Junior Horlicks: This markonym represent a type of amino acid that is good for increasing brain power.

13. PMPO: Peak Music Power Output: A common markonym used by music system marketers to convey the Sound output of their system. But sound experts say this is just to fool the customers.

14.NFO : New Fund Offer : Created by Mutual Funds when they introduce their new funds. Often investers mistook NFO for IPO of shares where they will get a listing premium. But NFO's are often have below par value when they are open.

15. PSPO: Peak Speed Performance Output: Created by Orient Fans as a differentiator.The company says that this tech gives air to all parts of the room.

16.916: Common markonym created by jewelery marketers. It says that the jewelery is 91.6% gold and rest copper and silver.

More markonyms will follow....

Market Statistics : HLL Market Share Across Categories

According to A C Nielsen, Hll in 2006 maintained its leadership position in the FMCG market. It ruled the following segments : Personal wash,Fabric Wash, Dish wash, skin care, Jams,Tea, powder etc and is a strong number 2 in Toothpaste , instant coffee and Ketchups.

Marketing Funda : Indian Readership Survey (IRS)

Indian Readership Survey or IRS is one of the largest readership survey conducted in India. Conducted by Hansa Research for Media Research User's Council ( MRUC), IRS covers readership for newspapers, internet usage, television veiwership .
Established in 1995 IRS data is widely used by media planners for finalising the media strategy. Besides giving the readership habits, IRS also provides valuable insights into the consumption habits of the Indian consumer. According the Hansa Reaseach, the information coverage of IRS is as follows

Media data study includes the following :
Press Readership: 350 + Publications
TV: 150+ channels
Cinema
Internet
Radio Listener ship: 15+ Radio Stations

Product data for the following is captured
70+ FMCG products usage and consumption habits
30+ Durable products ownership details
Financial Services
Urban & Rural Lifestyle Indicators
Telecom Data ( Source: Hansaresearch.com)

IRS uses sample from 24 states 91 cities covering a 250,000 respondents.The sampling details can be found here
IRS survey results are dissected by the media executives to prove their reach and cost advantages.
IRS is done twice a year and right now IRS round 1 2007 is out.
According to IRS Round 1 :
The top English Dailies are as follows (readership in 000's)
1.Times of India :6781
2.Hindustan Times:3331
3.Hindu : 2209
4.Deccan Chronicle:1311
5.Telegraph:919
6.The Economic Times: 774
7.Mumbai Mirror:735
8.DNA:539
8.Tribune:539
9.Midday:509
10.Deccan Herald:498

The Top Indian Newspapers are (readership in 000's)

1.Dainik Jagron: 17114
2.Dainik Bhaskar:12514
3.Hindustan:9052
4.Malayala Manorama:9052
5.Daily Thanthi:8351
6.Amar Ujala:8255
7.Eenadu:7233
8.Mathrubhumi:6961
9.Rajastan Pathrika: 6946
10. Lokmat:6874

Top Indian magazines are : (readership in 000's)

1.Saras Salil Hindi Fortnightly 4760
2.Vanitha Malayalam Fortnightly 3067
3.India Today English Weekly 2786
4.Grihshobha Hindi Monthly 2486
5. Malayala Manorama Malayalam Weekly 2294
6.Kumudam Tamil Weekly 2130
7.Balarama Malayalam Weekly 2124
8.India Today Hindi Weekly 1943
9. Anandavikadan Tamil Weekly 1898
10.Reader's Digest English Monthly 1869 ( Source : agencyfaqs)

Although IRS is used by most of the media planners, there are always some controversy surrounding the results. Since this is a sample based results, one can always question the statistical inferences. Every time the survey results are out, there are bound to be objections and blaming. To counter IRS, another survey is also there in the readership domain i.e National Readership Survey ( NRS).Combining both the results help media planners to chose the right media across markets. But all these surveys give only approximations. There is no guarantee that a 100 cc ad at the front page of the best daily in India can deliver the desired results. Hence marketers invent a new term : Opportunity to See ( OTS).. By putting an ad in the front page you are giving the reader an opportunity to see the ad .. how wise.

What is the front page ad of today's newspaper? Do you remember?.........

Marketing Funda : Limited Edition

Marketing Funda #4: Limited Edition

The post is inspired by one of my students Mr.Prateesh who raised this intriguing question: Why do companies come out with Limited Edition products?
Obviously this question can be seen in the light of high promotion advertisements of Marketing giants like Pepsi launching Pepsi Gold and Mirinda Limited Edition.
According to Wikipedia, the term "Special Edition" when used in Marketing, is intended to give the product something new and previously unseen in the regular edition.Limited Edition carries a sense of urgency and the products will be released for a shorter time or in limited numbers.
Limited Edition term is derived from publishing industry where limited number of editions can be printed with top quality impressions. But later this term was taken and used across industries.

Although Limited Editions are sold at a premium, there are many FMCG companies take up this concept minus the premium factor.The industry that has used this concept widely is the automotive sector . In India too there were lot of products that come with Limited Editions. The recent one is the Pepsi World cup Gold. Pepsi has earlier came out with Pepsi Blue in the last world cup.

The reason for launching a Limited Editions can be many :
1. Induce brand rejuvenation
2.Consumer Connect
3.Celebrate an event
4.On occasions/Festivals
5.Sales Promotion
6.Test Marketing
7.Creating a Hype in the market
8.Celebrity Endorsement
9.Encourage multiple purchases.
10. Create Brand Associations
11. Enhance Share of Mind

According to MG Parameswaran of Ullka, marketers use Limited Editions to increase consumer connect, to excite the market or for celebrations ( source:Financial Express). For example Lux came out with two limited edition flavor Chocolate Seduction to celebrate its 75 th anniversary.Pepsi Blue is to celebrate World Cup. Amara Raja Batteries had a Limited Edition to celebrate Narain Karthikeyan's entry into F1.

Sometimes Brands come out with Limited Editions to Excite the market. If the brand sales is plateauing, Limited Editions can bring back excitement into the product.The incremental improvements may encourage many new consumers into the product thus rejuvenating the brand.
Limited Editions also help to encourage customers to make multiple purchases as a Collectors item. Sometimes marketers use these Editions as a test marketing of a feature of attribute. For example Wagon R used a series of Limited Editions to test market some of the features which later became the part of the standard equipment.
Limited Editions are also used by marketers to boost the Share of Mind i.e to ensure Top of Mind Recall. Brands like Pepsi which has limited scope of differentiation in terms of product attributes uses Limited Edition like Pepsi Aha, Caffe Chino to boost the image and also the high profile promotion ensure top of mind recall.

Limited Editions are used for special seasons and occasions. Many marketers launch event/theme based variants of their products that runs for a short period but with a view to enhance the brand image.Some times Limited Editions are used to create a hype in the market.

Another advantage marketers see in Limited Editions are to use it to maximize the use of a celebrity.Palio effectively used Sachin and Special edition cars to boost the image of the brand.Limited Editions also help the brand to create positive brand associations. Coke used limited edition Rang De Basanti bottles to create positive association of truth and optimism.

All though there are many advantages to using Limited Editions as a strategic marketing tool, often these editions are expensive.Most often the return from these limited ranges cannot be measured. Sometimes the Limited Editions become failures which in turn affect the brand equity of the parent brand. Now a days marketers use Limited Editions as a tactical weapon ( sales promotion ) rather than a strategic tool.

Source: Financial Express

Market Statistics : Volume 1 Revised

This is the updated market statistics with details of the source. As usual the data is confusing and different source give different figures.

Size of Advertising Industry in India : Rs 16300 crore ( ET 26/2/07)

Snack Foods Market Size : Rs 4500 crore (ET 26/02/07)

Branded Snack Food Market :Rs 1300 crore( ET 26/02/07)

Apparel Market Size :Rs 80,000 crore ( Business World 05/03/07)

Apparel Popular Segment :Rs 5300 crore (ET 07/02/07)

Popular Segment Shirt Market : Rs 2800 crore ( ET 07/02/07)

Popular Segment Trousers : Rs 750 crore ( ET 07/02/07)

High Middle class Apparel Market : Rs 5360 crore ( ET 07/02/07)

Soft Drinks Market Size : Rs 6000 crore (ET 21/02/07)

Juice Market Size : Rs 1200 crore ( ET 21/02/07)

Mango Juice Market Size : Rs 900 crore ( ET 21/02/07)

Retail Jewelery Market Size : $ 12.2 Billion (ET 21/02/07)

Retail Jewelery Market : Rs 70,000 crore ( Business World 05/02/07)

Branded Jewelery Market : Rs 2100 crore ( Business World 05/02/07)

FMCG Market : Rs 64000 crore ( ET 07/02/07)

Durable and Electronics Market : Rs 25,000 crore ( ET 22/02/07)

Indian Luxury Goods Market Size : Rs 63,000 crore ( Business World Feb 07)

Coffee Retailing Market size : Rs 660 crore ( Business World Feb 07)

Gaming Market Size : Rs 217 Crore ( Business World 05/02/07)

Footwear ( Above Rs 1000) Market Size : Rs 250 Crore ( Business World 05/02/07)

Toy Market Size : Rs 1000 crore ( Business India : 11/02/07)

Agarbatti Industry Size ; Rs 1000 crore ( Business India 25/02/07)

Color cosmetics Market Size : $ 113.4 million ( Business India 25/02/07)

Retail Industry : $300 Billion ( Business India 25/02/07)

Marketing Funda : Socio Economic Classification (SEC)

Funda#3 : What is Socio Economic Classification ( SEC) ?

A common classification that is used by marketers to describe the Indian population is the Socio Economic Classification ( SEC). SEC is the classification of Indian consumers on the basis of two parameters : Occupation and Education of the chief wage earner (Head) of the households.The SEC classification,created in 1988 ,was ratified by Market Research Society of India (MRSI) ,is used by most media researchers and brand managers to understand the Indian consuming class.

According to SEC, the Urban Indian households are classified on the basis of the two parameters Education and Occupation into

SECA1,A2,B1,B2,C,D,E1,E2

In urban households, SEC A1 include those with graduation/post graduate holding senior positions like CEO’s and Middle level managers and also those entrepreneurs having some college education and employs more than 10 staffs. The chart is self-explanatory.
While the Rural Indian Households are classified into SEC R1,R2,R3,R4.
In the rural classification, the parameters are Education of the Chief wage earner and the type of the house.

The SEC classification helps the marketers to identify segments tha t has high consuming potential.The high potential types : A1,A2, the medium ones and the bottom of pyramid ones. The SEC classification is used by Media planners to decide the media which gives the client maximum effectiveness. The research team at the me dia houses uses the NRS and IRS surveys' raw data to identify the reach of the media in these SEC segments and uses this input for pitching their campaign to large advertisers.

Although this classification is popular for over 18 years, the classification has its negatives also since it takes only two parameters: education and occupation .This is based on the assumption that higher education leads to higher income thus higher consuming potential. But we know that this may not be true always. A trader or a retailer with no qualification can earn more income than a Post graduate executive, but SEC will categorize the traders/retailers not as SEC A1or A2.

Hence Market research users council ( MRUC) has devised another classification called New Consumer Classification System( NCCS) which calculates a Household Premiumness Index ( HPI) which takes parameters like ownership and consumption of media services and products with other demographics.

All these classifications create jargon that we teachers lecture and brand managers are still searching for the White Light that provides the key to understand the Indian consumer.

Source: cks.in,readbetweenps.blogspot.com,agencyfaqs

Marketing Funda : Don't Ignore Consumer Generated Media

Marketing Funda #2

This post is in reaction to the disturbing cartoon that appeared in the newspaper "The Hindu" dated 22/01/2007. The cartoon given below prompted me to give a rather personal response to the marketing myopia exhibited by this highly respected newspaper.

I used to admire the cartoons by Mr Keshav but this is way off the mark: some thing unexpected out of a newspaper of high repute.
That makes me think about the rationale or thinking behind this cartoon? What exactly the newspaper tries to convey to the reader? Does it mean that the bloggers like you and me are monkeys? Or does it mean that even monkeys can blog?
I call it the classical case of marketing myopia and plain arrogance of a powerless king. There is lot more to the logic of the cartoon than the obvious pun.

For the uninitiated:

Consumer-Generated Media (CGM) describes a variety of new and emerging sources of online information that are created, initiated, circulated and used by consumers intent on educating each other about products, brands, services,personalities and issues. (A Nielsen BuzzMetrics White Paper by Pete Blackshaw and Mike Nazzaro | Second Edition, Spring 2006) . Wikipedia defines Consumer Generated Media as word of mouth that exists on the Internet.

CGM has huge impact on marketing because the information is now accessible to every one. Consumers are now talking to each other through blogs, communities, discussion forums podcasts etc. Hence everything about everything is now communicated. Consumers now checkout reviews about products through specialised consumer review sites before making a decision ( not all but many). The more worrying factor for a marketer is that negative word of mouth travels even faster. Hence smart marketers keeps a tab on what is happening on the CGM to make sure that they are in tune with what is happening.
I
n this era where every one is looking seriously on CGM , why "The Hindu " come out with such an insulting cartoon ( Am I being too emotional !). The reason is simple, traditional media is facing competition from CGM which they did not expect. Traditionally the power of information and their dissemination was a monopoly of journalists. From time immemorial, the power was vested on the media and they enjoyed it to the maximum. The evolution of CGM just took the power away from the traditional media. Now the World Wide Web has enabled the common man to publish... That is what I call Disruption. The logic of the cartoon is now clear isn't it? The editors of the newspaper now feel powerless. The depiction of the blogger as a monkey also reveals another side of the arrogance: do the editors feel themselves as someone above the readers? Bloggers and users of CGM also are readers of the newspapers. Here we can see the editors looking down upon the CGM from an Ivory tower that does not exist now.( I know it better because I also worked in a media).

The editors should take a cue from the product failures caused by disrespecting competition and I encourage them to read case studies on how traditional encyclopedias got thrashed by Microsoft Encarta because they underestimated competition. The cartoon is also a part of the traditional media's move to enforce some sort of restraint on the emerging CGM space in India. Recently Burkha Dutta of NDTV vociferously demanded censorship for CGM. I would like to see it as not as a genuine worry of a journalist but a worry of a business executive. In India, the media always have tried to block competition in all possible ways. Even those media which encourages views of freedom of speech and expression and free economy have lobbied hard to block the entry of foreign media into India. Print media has so far succeeded in blocking any form of competition from outside. Now they face competition from a different kind: You and Me !
Having said that, not all media have the same views as "The Hindu" presents. Time Magazine has celebrated CGM and has chosen YOU as the person of the year 2006. The editors of the Time are enlightened enough to see you and me as something more than the primates. Lev Grossman puts it this way
"But look at 2006 through a different lens and you'll see another story, one that isn't about conflict or great men. It's a story about community and collaboration on a scale never seen before. It's about the cosmic compendium of knowledge Wikipedia and the million-channel people's network YouTube and the online metropolis MySpace. It's about the many wresting power from the few and helping one another for nothing and how that will not only change the world, but also change the way the world changes." ( Time Magazine December 2006).

Most of the enlightened magazines and journalists have realised the importance of CGM and has found ways to use the CGM to their advantage. Even CNN IBN have given the name " Citizen Journalists " to the viewers who wish to contribute news and views to the media.
To the Editors of Hindu, I wish to say " You don't control the information age"

Welcome to our world.

And by the way You just lost a brand loyal customer... forever.....

Marketing Funda : Masstige

Marketing Funda is a new series from Marketing Practice. A lot is happening in the marketing field which has created new JARGONS. " Marketing Funda" series is aimed at keeping you and me updated on the new fundas.

Funda #1 : Masstige

Masstige is a term introduced by Michael Silverstein and Neil Fiske to refer to a new category of products aimed at providing "Luxury To the Masses". The term Masstige is derived from the words Mass + Prestige. Silverstein and Neil published a wonderful article in Harvard Business Reveiw (April 2003) titled "Luxury for the Masses" explaining this concept in detail.

Due to a variety of reasons, the luxury market has evolved into different types like
a. Accessible Super Premium products which are priced in such a way that middleclass will be able to afford it.
b. Old Luxury brands extending downwards to catering to mass market
c. Mass prestige brands or Masstige brands which occupies the sweet spot between Mass and Class.

The term has great relevance in the Indian context because Indians are more value conscious and the market for masstige is very large. According to the authors, several factors have caused the evolution of masstige brands. The causes are in the Supplier side, Company side and in the Customer side.
The rise of the income and the change in the retail sector ( discount retailing ) and the emotional awareness has sparked the consumption of such brands. This has forced many firms to look at tapping this market. The accessibility of global resources and efficient supply chain helps the firms to control the cost thereby offer more value. The customer also has evolved in the sense that they began to demand more for less. Indian society is moving towards NUF (Nuclear Urban Family ) where each individual has their own tastes and preferences.

The marketers also find ways to make the brand stand out as a prestige product without the 'expensive ' tag. Brands like Peter England has succeeded because of the prestige image and the value delivery. Pond's has moved to cater to wider mass without compromising the image.The authors point out that inorder to successfully implement the concept has to make sure that they create a ladder of genuine benefit to the customers. The firm should have a passion for innovation on the marketing mixes. More over an outsider ( outside-in)view of the category should be encouraged to ensure that managers are not myopic to the changing marketing environment.

Related Brands
Peter England
Pond's
Tata Indica