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July 13

Marketing Magazine of IIM Shillong

Shopper Marketing

Volume 5 | Issue 1

Vs

Consumer Marketing

Mr Vishal Singh Associate Professor of Marketing at New York University Stern School of Business


FROM TEAM MARKATHON experience from psychology research and retail competition. Dear Readers,

The world of retail is changing rapidly and it is very important to get hold of consumer psychology to gain competence and

As the monsoon season sets in and the beautiful rains

consumer loyalty and this section will enrich you with

capture your imagination, it’s time to let all your creativity

knowledge packets from the business guru. For this month’s

flow. Most of the readers would be back to college after their

Book Review section, we get you inside the world of one of

internship stints where they would have excelled with their

the most powerful brand in this world: Coca Cola via the

innovative ideas and marketing insights. The month gone by

journey of its one time CEO Neville Isdell. The book captures

was full of activities and events, some were expected and

the journey of a man from an entry level employee to the

some threw us out of our seats. Cannes Lion set the tempo

man at helm calling the shots. Addicted will give you a

for the marketers as it was time to reward the brightest

thought provoking analysis of two trending ads while updates

minds in creative communication. Numerous Indian ad

section gets you heads up on the recent happenings of the

agencies won laurels for their out of box campaigns striking a

marketing arena.

chord with the consumers. We are also proud to unveil the logo of Marketing Club of IIM P&G, the global FMCG giant came up with its launch of first

Shillong with this edition of Markathon.

toothpaste in India extending the Oral B family. Even in world of sports, we saw some head turning, jaw dropping moments

So sit back and enjoy!!!! Happy Reading

like India winning the ICC champions trophy, Djokovic losing to Murray and the likes. As we celebrate our happiness of

Happy Reading!

being together, it’s time to thank our readers who have been

Team Markathon

pouring in their thoughts from across the country and throwing light on the various facets of marketing enriching our journey with thoughts and ideas that delve deep into the creative world. We are really thankful to you as you are equally responsible for the success of our magazine and we look forward to your feedback as it will only help us geting better with every edition.

The cover story this month unravels the mystique world of ‘Shopper Marketing’. With consumers not being the typical shoppers, it was necessary to address the shoppers per se and communicate with them through in-store campaigns and

THE MARKATHON TEAM Editors Ashok A Kamalpreet Singh Saluja Pallavi Prateek Gaurav Shashank S. Tomar Swikruti Panda

initiatives. It’s a must read for the budding marketers as it brings you closer to the latest development in the retail

Creative Designers

world. For this month’s Vartalaap, we get you perspectives of

Sushree L. Tripathy Vaibhav Annam

Mr. Vishal Singh, an Associate Professor of Marketing at New York University Stern School of Business. He brings in- depth


markathon |july 2013

CONTENTS

FEATURED ARTICLES PERSPECTIVES CAUSE MARKETING & BRAND ACTIVATIONS RICHARD MANICKAM | SIES COLLEGE OF MANAGEMENT STUDIES, MUMBAI THESE BABIES SELL THEMSELVES - AN UNCONVENTIONAL COMMUNICATION APPROACH SUMIT SINHA | DEPARTMENT OF MANAGEMENT STUDIES, IIT MADRAS VARTALAAP MR VISHAL SINGH ASSOCIATE PROFESSOR OF MARKETING AT NEW YORK UNIVERSITY STERN SCHOOL OF BUSINESS

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COVER STORY SHOPPER MARKETING VS CONSUMER MARKETING SHASHANK AND SWIKRUTI | IIM SHILLONG

EYE 2 EYE IPHONE MINI: MARKET PENETRATION OR BRAND DILUTION? SHIVAM SHEKHAR | MDI GURGAON; HRIDAY BIKASH DAS | IIM SHILLONG SILENT VOICE NJOY E-CIGAR

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SPECIALS ADDICTED SWIKRUTI PANDA & SUSHREE TRIPATHY | IIM SHILLONG BOOKMARK PALLAVI | IIM SHILLONG RADICAL THOUGHTS ASHOK A | IIM SHILLONG

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UPDATES PRATEEK | IIM SHILLONG

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MARKETING CLUB LOGO

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PICTUREPAGE

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perspective

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Richard Manickam SIES College of Management Studies, Mumbai Does your work actually make a difference to anyone? Does your job profile include bringing a smile back to a face that has been long lost in this world? Does your campaign possess a ‘Cause’ that has the power to bring about a Change apart from Brand Recall and Sales Figures? Do your brand activations actually connect at the ground level with your Consumer’s emotions?

The cause here is to make a difference in the society by being the change in the society and stop pointing fingers.

Feel Good

Purpose

These are exactly the same questions that arise in the mind of a Cause Marketer. About contributing and adding towards building positive human relations. The term ‘Cause Marketing’ was first coined by American Express in 1983 for the Statue of Liberty Restoration Project. The 3 month campaign raised close to $ 2 million and the American Express card use rose 27%. India has seen significant Brand Activations in recent past through Cause related campaigns. Aircel’s ‘Save our Tiger’ where you could donate funds for WWF Campaigns or Tata Tea’s ‘Jaago Re’ in which it was estimated that 6.5 Lakh Indians used the platform to register as voters thereby creating a widespread social awakening.

On similar lines is the ongoing campaign of ‘I LEAD INDIA’ a Times of India initiative in association with Maruti Suzuki is an activist program. It seeks to mobilize the youth in the 18-24 age group and make them agents of change at the grass-root level.

Picture source: Edelman Research Report The consumer psychology about Cause marketing is well brought out by insights that the Edelman Research Report has captured. 82% respondents believe that supporting a good cause makes them feel better about themselves and nearly 50% said that ‘Social Cause’ ranks higher than ‘Brand Loyalty’, ‘Design’ and ‘Innovation’ as a Purchase Motivator. Coca Cola a brand that resonates with happiness is actively engaged in Cause Marketing. The brand came up with its campaign-Happiness without Borders. It invited the people of India and Pakistan, sharing a turbulent relationship, to share a simple moment of connection and joy through its Hi-Tech Vending Machines. The vending machines aptly called as the ‘Small world Machines’ brought together human emotions by displaying real time action and initiating joyful interaction. Brand Activations form an important part of this Cause Marketing in bringing the consumers emotions directly

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markathon|july 2013 Campaign are Apple, SAP, Beats by Dr. Dre and Starbucks to name a few. A Simple Brand Activation program done by Starbucks where it used the technology to establish the relationship between the Cause, consumers and the brand has won laurels.

in touch with the Goodwill of the brand. The purpose of brand activation is to communicate to its customers, the values for which the brands stands and establish a connect with people. European passenger car manufacturer Volkswagen in association with the Ministry of Tourism launched the ‘Think Blue’ Campaign. The objective of the campaign was to persistently put a conscious effort towards a cleaner and a more sustainable environment not only for ourselves but our future generations as well. The campaign included launching Think Blue pages on Facebook giving helpful sustainability tips and an iPhone game where in players have to cover the most ground using as little fuel as possible.

Another significant Campaign for which multiple brands came together for a brilliant cause is the RED campaignFighting Aids in Africa. By the time we wake up tomorrow, another 5500 men, women and children would have died in Africa due to Aids. They die because they cannot afford treatment costs of 60 cents a day. The Cause and the Goal is to have an Aids free Generation by 2015.Partners supporting the Red

For 10 days, Starbucks contributed $1 on every Check-In at Starbucks stores in the US & Canada - up to $250,000 - and they hit their goal 2 days early!! $250,000 raised in 8 days! This is the enormous power of Cause Marketing. From saving the depleting wildlife to helping a person in need of a treatment, there are immense causes for marketers to actually leave a mark behind. The 4Ps, STP, and the other so important concepts have more power than mere increase in topline of balance sheet. It is the power a Cause, a Brand and its Loyalty can create to prove that humanity continues to thrive in our hearts. It is that part of Marketing which has its heart in the Consumers but the heartbeats remain with the recipients of the Cause. We as Cause driven Marketers are as simple a connection as the blood which flows into these hearts. Cause marketing and brand activation will hence gain prominence in the coming years and through creating a link between social issues and brand philosophy, is likely to reach into the wallets of consumers through their hearts.

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perspective

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These Babies Sell Themselves An Unconventional Communication Approach

Sumit Sinha Department of Management Studies, IIT Madras

Is advertisement, the trump card for the Indian giant firms to communicate their brand? Rather, can there be a way to communicate a product or service without advertisement? This article will discuss this unorthodox marketing strategy along with its implementation so that we could try and find out, “Is there any way, that could help reducing the advertisement expenses from the company’s income statement?” Let us first look at the data that we are dealing with. Indian companies spend roughly around $17.14 billion on advertising every year, including online advertising, outdoors, and social media. This massive amount can fund roughly five 1000 MW nuclear power plants per year in India. This Media and entertainment Industry is expected to grow at a CAGR of 15% over the next five years. (Source: Economic Times)

But how was this trend started? The history of advertisement takes us 4000 years back when in 2000 BCE, the Egyptians started carving out names of their shops on stone. This was the first time when a vendor cried out to introduce his brand. The real advertisement, what we see today, started from the year 1631, when for the first time ‘La Gazette’ newspaper printed a classified ad. The emerging technology started giving birth to various media for advertisements. We had radio ads, television commercials (TVC), direct selling and what not? Then

came the online ads, which were backed up with bulging e-commerce industry. After the launch of Google in 2004, it was clear that dotcoms could also earn massive amount of revenue, without even selling or buying any item. Google’s revenue model is based majorly on online advertisements, which is now valued at around $23 billion. The evolution of advertisements took a rapid pace after the 19th century because the industry was able to get enormous customer base and ultimately earning more profits due to these communication methods. Meanwhile there were few big brands that did not advertise at all. They never budgeted a single penny on ads and other Above the Line (ATL) activities. And yet they earned huge amount of profits, and are famous! You think it’s not possible? Read on for a major paradigm shift. Think of a brand, a giant from Italy, famous for its cutting-edge automotive engineering and photonic speed of its product. Ring any bells? Ok, what if I say ‘tangy red’? Yeah! It’s Ferrari! Ferrari has set up a huge empire, a huge name all without any glossy advertisements, flashy outdoors and even without any vanity fairs. People buy Ferrari because they are passionate about the car, the technology, the speed and most of all, the Ferrari as a brand. The only promotion activity Ferrari enjoys is ‘word of mouth’,

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markathon|july 2013 their product so distinguished that consumers are crazy about them.

and this base is growing wider on social media. In an article by Terry O’Reilly, he poses a question,

Let’s come to India. Nalli Silk Sarees is a $100 million Chennai based Sari retail chain. According to Lavanya Nalli (LiveMint, Aug 26, 2011) Brand Nalli, which is an 84-year-old legacy, is growing at a rate of 12%; more than the market average. Yet they have never actively spent any penny on the brand promotion. No advertisements, no sales promotion, no events or PR. Lavanya, a HBS graduate still feels that there is huge amount of demand from Indian market, which they need to satisfy in order to grow the business. If a businessman (businesswomen in this case) is getting drift of such voluminous demands, then spending on ads is like burning money. Shahnaz Herbal Inc., a 30year-old beauty brand has not spent anything in advertisements either. In an interview done with IndiaAfrica Connect, Shahnaz Hussain said, “I specialize in chemicals, not advertising at all”.

“How does the management in Ferrari measure the effectiveness of this unorthodox strategy?” The answer is simple, “They sell every car they make!”

Other examples at a global front include Costco, The Body Shop, Ben & Jerry’s, Zappos etc. These are few brands that have not spent significant money on advertising. They have made their brand so popular,

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perspective She also quoted, “If the Americans and the British say it's amazing, this itself is the biggest publicity for the product”.

markathon|july 2013 able to locate the product in a specific space in their minds, far ahead of their competitors.

What do the above two cases infer? Looking at the positioning, it can be concluded that these brands have made themselves so strong and their product so special, that the customers are attracted by the product’s technical & functional quality itself. Let us try to plot the above-mentioned brands in the following Credibility Visibility chart (CVC):

Price exclusivity Offering more value in the product on same or less price than the competitor gives an extra edge to your brand over others. This way the brand can be further distinguished on the basis of price exclusivity.

All the above-mentioned companies have placed themselves at the top right quadrant of the chart. This shows that their credibility as well as visibility is extremely high which gives an unparalleled positioning of the brand in the consumer’s minds. So, firm’s entire plans for an unconventional strategy of communication should focus on bringing the brand from unknown or undiscovered state to the unparalleled state. Please note, here the visibility does not stand for the communication of the brand, but it’s a mere notion to expose the brand more to the consumer. But the question now arises is, how? Well, increasing the credibility of the product is not something what firms can’t control. The motive is to give a high value package to the customer that could do the following tasks. Distinguish A good positioning says it all. Brands are not expected to communicate the positioning. A product must be designed in such a manner that a customer should be

It is advisable that the strategies, briefesd above should be deployed at the New Product Development (NPD) phase itself. The reason is, that adding value to the product in the later product life cycle stages can prove costly. So it can be concluded that focusing on the correct placement of the brand can help it grow and make a good impression in customer’s mind. The main advantage of this approach is that all the efforts and expenditure on the marketing activities can be easily tracked and further changes can be done in the strategy to get the desired results. We all know the loyalty is not made on the basis of cool TVC’s or hilarious print ads, but it is as a result of the high quality. And loyalty is what modern businesses crave for, right? Imagine, if all the firms start working like this, then what will happen to the 4000 year old legacy of advertising? “Well, that’s worth a thought!”

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An Interview with Vishal Singh Associate Professor of Marketing at New York University Stern School of Business

Mr. Vishal Singh is an Associate Professor of Marketing at New York University Stern School of Business. Before joining NYU Stern, Professor Singh was Assistant Professor of Marketing at the Tepper School of Business, Carnegie Mellon University, where he won the Bachelor of Science in Business Administration Teaching Award for outstanding teaching. Professor Singh's research focuses on retail competition, competitive pricing, store brands, database marketing and empirical industrial organization. He has published articles in several scholarly journals including Marketing Science, Journal of Marketing Research, and Quantitative Marketing and Economics. Professor Singh received his Ph.D. in Marketing from Northwestern University's Kellogg School of Management in 2003. In this exclusive interview with Markathon, he shares with us some valuable insights on the current trends in marketing and leaves us with a prized advice.

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Markathon: With years of in-depth work in the field of psychological research, what has been the most interesting inference you have come across?

shareholder value. Of course maximizing customer satisfaction/equity (or welfare if you want to call it that) is one way of achieving those goals. But it is important not to confuse As Hal Varian (a terrific means (customer economist at satisfaction/welfare) with ends (profits). Berkeley/Google) says,

Mr Singh: My own research into psychology is rather nascent. I have always been interested in philosophy but more as a “Data are widely hobby than a profession. The insights provided by ‘ancient’ available; what is scarce Markathon: Today when philosophers are quite is the ability to extract big data is a buzz and profound considering the organizations are spending wisdom from them”. time they were putting the more and more in ideas down. A particularly accumulating it, what according interesting period for me is the so to you should be the focus to make called “Axial Age”, roughly few best out of the spend? hundred years BC. This was a period of genuine novel ideas across the Mr Singh: We are living in an era of globe in asking fundamental what is termed as ‘big data’. In questions of human existence. every aspect of our daily lives, Consider Buddhism/Jainism in from the way we work, shop, South Asia, Confucianism in communicate, or socialize; China, and trio of Socrates, we are both consuming and Plato, and Aristotle in Greece; creating vast amounts of and of course the Old information. More often Testament little before. Modern than not, these daily activities create a trail of psychology offers numerous interesting insights, but if digitized data that is being stored, mined, and you look carefully, a lot of it is reiteration of old ideas analyzed by firms hoping to create valuable business but tested in what we call a ‘scientific method’. intelligence. However, much of the promises of such

Markathon: In view of the increased competitiveness in the retail segment over the last few years, how do you think retailers can achieve a balance between maintaining profitability and ensuring consumer welfare? Do you see a gradual shift from price competition to brand wars? Mr Singh: I don’t think retailers, or any corporation for that matter, necessarily cares about consumer welfare per se. The objectives are well defined, as I am sure all of you are taught, to maximize profits or

data-driven policies have failed to materialize because managers find it difficult to translate data into actionable strategies. As Hal Varian (a terrific economist at Berkeley/Google) says, “Data are widely available; what is scarce is the ability to extract wisdom from them”.

In today’s world, Marketing requires a combination of analytical skills and intuition. It is both an art and science.

Markathon: Do you think analytics from market research activities is curtailing the creativity that forms the basis of the art of marketing? Mr Singh: Not necessarily. You can be

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quite creative in executing analytical skills just like developing a clever ad campaign. Marketing, unlike say Finance, used to be regarded as a ‘soft’ business field. But it is no longer the case. In today’s world, Marketing requires a combination of analytical skills and intuition. It is both an art and science.

Markathon: Can you share with our readers some insights on the techniques that help in gauging marketing effectiveness such as customer analysis, choice modeling, competitor analysis etc.? Mr Singh: Business is an applied field. For the most part we are borrowing tools or techniques from basic disciplines such as Statistics, Economics, and Psychology. There is no single method or technique that one can master. Even topics you mention, customer or competitive analysis or choice models, need to be tweaked and applied differently based on the problem at hand.

customization required as you enter different markets with its own set customer psychology, competitive situation, regulations and so forth. What digital marketing allows is to apply similar principles to customize business tactics to increasingly fine segments or even segments of one. Of course all this needs to be done with care and by being compatible with your global brand image.

Markathon: What is your one piece of advice to all the budding marketing aspirants following Markathon?

The problem is that students often shy away from anything remotely outside of their chosen specialization, which I think is a mistake in the long run. You can’t be a good marketing manager without at least a working knowledge of other facets of your business.

Markathon: How do you think brands should customize their marketing mix to adapt to the fast evolving digital economy of the time? Mr Singh: Branding in general requires maintaining a global positioning or image. The other marketing mix, say pricing or communication and advertising can be customized to cater to narrower segments. Think of marketing mix strategies of a global brand and the

Mr Singh: We live in a world of specializations and majors such as Finance, Marketing, and so on. Within each field are further specializations Investment banking, corporate finance, advertising, market research etc. This makes perfect sense in core sciences such as Physics or Biology that get highly technical. Business world and business schools have adopted a similar approach, which at times are counterproductive. Of course a marketing and hedge fund manager will have different sets of skills and expertise. The problem is that students often shy away from anything remotely outside of their chosen specialization, which I think is a mistake in the long run. You can’t be a good marketing manager without at least a working knowledge of other facets of your business.

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cover story | Shopper Marketing vs. Consumer Marketing

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Cover Story

Shashank | Swikruti | IIM Shillong 12 10


cover story | Shopper Marketing vs. Consumer Marketing Consumers are the ones who use or experience the product, even though they might not be the ones purchasing the product. However, the one purchasing the product is the shopper, who may or may not consume the product. Consumer side is an individual's self-perception and attitude, while the shopper side represents his buying behaviour. Shoppers & consumers have a fundamental difference in their relationships with brands. What a consumer thinks and feels and what the same consumer ultimately buys as a shopper can be completely different. Most pre-store decisions of consumers are brand driven: the shopper has purchased the product in the past and will continue to do so in the future. However, in-store decisions are mostly based on perceived value, merchandising, and packaging. Though consumers are often brand loyal, they may turn promiscuous while making the purchase decision, and this opens up a critical opportunity for marketers to influence the purchase decision. Stated in simple terms, Shopper marketing means understanding how consumers behave as shoppers in different channels and formats, and impact the purchase decision of shoppers. It entails thinking of the in-store experience as a media channel. Thus, it could mean anything from integration into an instore shopping phone app to an end-of-the-aisle display or a program on Walmart TV. Shopper marketing is driven by the attitudes that shoppers have towards the shopping experience and factors that create shopper's loyalty to a brand after purchase from a channel. Among other things, it requires an understanding of which packaging stands out and works best for the shopper, which colours grab attention, what kind of compulsion, education or demonstration does the merchandising do, what cost of an end-aisle display or window is acceptable, which trip

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patterns does the shopper usually take. Thus, successful shopper marketers can be expected to turn up from individuals having a mix of experiences in sales, trade marketing and brand management. While consumer marketing focusses on how, when, where and why consumers use the product; shopper marketing focusses on these aspects as consumer buys/shops for the product. Consumer marketing focusses on Marketing Communications, whereas Shopper marketing focusses on in-store purchase decision influence. Consumer marketing tends to be more strategic in nature while Shopper marketing tends to be more tactical. An integrated approach towards consumer insights and shopper insights can help build a real robust consumer advocacy for the brand in its category post the first moment of truth (shelf) and the second moment of truth (experience). Though traditional mind-set influences us to believe that shopper marketing is an extension of trade marketing, the truth is way different. Shopper marketing is revolutionary because it is not merely an evolution of or a new name for promotions, but rather an integration of consumer marketing, trade marketing and consumer promotions. Within Consumer Packaged Goods, the shopper marketing activity is most pronounced in high spend categories like soft drinks, laundry, home care products, cereals and convenience foods. However, Shopper Marketing is not merely limited to Consumer Packages Goods. Shopper marketing is permeating many other product categories from consumer electronics to consumer durables. Shopper marketing in automo biles, though currently at a nascent stage, is picking up fast as marketers increasingly understand the primacy of in-store experience

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cover story | Shopper Marketing vs. Consumer Marketing in automobile purchase decisions. Why is Shopper Marketing required? A Booz & Company research says that more than half of brand choices in many categories are made in store. In certain categories, a large proportion of the target audience may never realise or notice any marketing element for a brand beyond store walls. Thus, we need to improve the balance between demographic, psychographic, and behavioural research. Shopper marketing helps in getting people to shop at a specific channel and inspiring them to buy more of a brand. The intersection of insights on shopper's trip mission and consumer's consumption occasions creates chances to connect with buyer and drive sales. A huge increase in the number of private label brands that strive on stimulus generalization has also caused an increase in attention towards shopper marketing. In the past decades, the ATL advertisement to in-store spending ratio was skewed towards ATL advertising. With increasing consolidation and sophistication in the retail industry, and increasing clutter of brands in product categories, the balance of power is shifting in the direction of in-store expenditure. Shopper Marketing lifecycle: Shopper marketing lifecycle claims to orient all the actions being driven and guided by consumer psychology. The marketing stimuli are carefully designed by understanding the consumer behaviour. The Shopper marketing has a lifecycle through which it evolves to finally get ingrained in the DNA of the front end activity of an organization. Shopper marketing if

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implemented with clearly defined goals for the firm, the initiative has the potential of bringing in a distinctive brand identity in the minds of the target; enhance better relation with the retailers by helping them with consumer analytics and their implications. Shopper marketing also brings about a kind of coherence in the brand communication both in the store and outside as well which in the long run goes on to create strong consumer loyalty. The solutions developed hence, if increase the sales then the retailers are also in a win- win collaboration with the firm. The process also leads to lessening of out-of-stock penalties for the firm causing through more precise forecasting. Larger inflow of consumer insights keeps a buffer of effective ideas that can be worked on to bridge the subtle and enable quicker and successful product introductions. Now delving deep into all the stages of the Shopper marketing lifecycle, the entire process can be divided into three main phases based on the amount of effort put in and the impact created. The first among all being the incubating stage, where in the investment is needed to ensure the basic capabilities. At this stage, people from different functionalities are roped in. At this stage qualitative assessment is possible, but quantitative impact analysis is not that feasible. So, at this stage ad-hoc funding from various teams creates struggle between the brand management, category management and sales. But majority of firms at this stage of development are able to reap not more than 5-10 % of total benefits. Lack of ownership or lack of sincere commitment and belief in the possible results of this new initiative are some of the hindering mindsets.

Incubating Stage

Scaling Stage

Embedding Stage

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cover story | Shopper Marketing vs. Consumer Marketing

Next in the development process is scaling. In this effort is made mainly to transform the incubated practices into sustainable strategies. At this stage, capabilities are such developed that robust metrics are in place to give the exact quantitative analysis of reach, conversion and ROI using scorecard approach. This kind of assessment helps in doing away with all sorts of misbelief in the potential of this approach in giving all the brands a leg-up among the clutter. About 50% of firms are in the scaling stage and their performance has fetched them still only 25% of the entire potential of the expansion. Final stage in the development is that of embedding the same culturally in the firm’s culture. In this stage after having tested the impact and scalability finally efforts are made to gain significant margins and strategic advantage over others. Insights from this cultural adaptation get ploughed back at the product development stage and the processes are standardized to accommodate shopper marketing in the overall marketing mix.

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Importance of Collaboration: A fruitful shopper marketing plan cannot survive and thrive in silo. The collaboration between manufacturers and retailers is indispensable. A manufacturer cannot gauge the insights from the customer’s side unless the retailer sees benefits in sharing the customer data. And the retailers cannot benefit by cooperating in the shopper marketing initiatives unless they work fairly with their partners. There are several characteristic parameters on which the conflict of interest has prevailed between the retailers and the manufacturers like measuring and demonstrating the results. This is of paramount importance for manufacturers so that they are able to gauge the returns on their investments on the go. When it comes to collecting and delivering shopper insights also, it is tough to convince the retailer about the mutual benefits and the efforts worth making. As far as identifying and addressing the emerging trends is concerned both manufacturers and retailers give due importance to the fact but still there is a lot to be done on both sides to bring in effectiveness of the

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cover story | Shopper Marketing vs. Consumer Marketing process. The customer segmentation models need to be translated effectively. As far as the manufacturers are concerned, they have ensured good result oriented

endeavors but the retailers are far behind achieving effectiveness of the implemented practices. The manufacturers are in a deadlock as the retailers expect metrics of impact of each and every shopper marketing practice that they are asked to deploy. To show the reflections overnight is not pragmatic on the manufacturers’ part. Moreover, the retailers are skeptic about cross-store or cross-category collaborations. And when it comes to the other side of the story, the retailers shun these new initiatives as the same older practice with a new tag and do not see much of value in the same. They criticize the manufacturers on being prejudiced on the propositions that they make rather than some innovative idea that they want to venture the market with and end up only seeking data to support their say. The relationship between the manufacturers and the retailers may fall into two categories: transactional or committed. The committed relationship is one in which both parties benefit and codevelop constructive ideas. The transactional is one in which benefits are least probable for long run and may call for defection of the partners. The classical method to explain this difference in behavior is “Prisoner’s dilemma”. In this case both the parties try to play safe by fearing too much of transparency could

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prove fatal for them. The data shared with partner if gets leaked to competitors may cause huge damage. And to overcome the risk in the short-term keeping in sight the paybacks in the long run, it takes utter trust between the partners in the form of symbiotic relationship between both through shopper marketing. The pragmatism of the idea of wading through short-term risks to gain in long term is very much apparent in the “Preparedness” campaign by Walmart and P&G, where-in they encourage the consumers to stock up cold/cough solutions, as they were earlier losing these sales to the chemists locally situated. No doubt the campaign was bang on and it did set the revenue boxes ringing louder. Digital Shopper Marketing: The digital shopper marketing offers a foray of services that essentially give a feeling of not just saving on time and cost. This channel has the potential of providing the esteemed shopper of being smarter and making his/her wholesome experiences a lot more satiating. Kellogg’s Share Your Breakfast Program was an instant hit as it facilitated another aspect of aligning with the value system of the shoppers. PR drivers and utility drivers also need to be balanced. The location based check-ins has provided good public relations opportunity to many brands. It is very important to understand if the initiatives adopted on a big scale are really shopper motivators. For instance QR codes do not motivate the consumers to indulge and reveal their preferences better to be captured and leveraged by the advocates of shopper marketing. To cite a few, Warby Parker, the eyeglass retailer has tried to transform the brick and mortar store into a living and breathing website. By such an adaptation, the retailer is creating an ecosystem where the shopper is delighted to shop almost all the items online. And the retailer himself gets a chance to interact in person with each shopper. The concept of

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cover story | Shopper Marketing vs. Consumer Marketing Magic Mirror is also a brilliant attempt in this channel. In this, the shopper gets to try on stuff virtually and if need be, can have the experience sent over e-mail. This kind of interaction records the entire shopper’s in-store experience and provides brilliant food for the manufacturer to analyse and get cues and deploy the inferences to best interest of both the partners. Pioneering Acts of Shopper Marketing: P&G has pioneered the act of Shopper marketing by adapting and ingraining the culture of “Store Back” to the core of its culture. They have developed the concept of “Store back” more as a mindset to attain their business goals. A systematic mode of capturing the First Moment of Truth if could be scaled up at an organization level, then for an FMCG giant ‘Store Back’ was a leap ahead. The traditional mode was to start with the designing of the campaign keeping all the channels of ATL promotion in mind and later trying to tailor it to capture the consumer attention in-store. P&G here defers from the rest to be the first one to consider the stores first. They have also pioneered the fact that, stores are the real torture tests for any campaign. If it does not work in the store, it is way too optimistic to expect it to work at all. Such a policy is also beneficial for the retailers as the outcomes are bound to end up bestowing greater attention to the end-customers.

markathon|july 2013 markathon|month

O-P material or facilitation of connection between a shopper to what is communicated to him through the conventional ATL media, they really are very important especially for categories that are confusing and that come in several SKUs. Hence, the wave of Shopper Marketing is the next big thing all set to engulf all the manufacturers and retailers and it’s time they shed the fear and take the short term risks head-on that come along “Shopper Marketing” and lead the bandwagon before they are forced to join it when it is tough to catch up.

A more logical justification for allocating lot of intelligence into the process is that, say a TVC will spend nearly 30 sections to get a chance to register a product in the target audience’s mind and fall in his/her range of consideration. As opposite to this, in shopper marketing 30 seconds get reduced to 3, with an even bigger stake i.e the purchasing decision of the customer. Be it the simplified message of “1 pack = 1 Vaccine” on Pampers or “Love at first sniff” on Duncan, P&G has successfully nailed it. Relevant P-

17 10


Today in the age of “fight for higher sales”, there is an epidemic of premium brands stooping low to cater to the burgeoning middle class customer base, specifically of the emerging economies. Volkswagen’s Polo and Vento, Blackberry’s BBM phones and recently the Mercedes entering the A Class. These brands are missing the wood for the Shivam Shekhar trees, hardly realizing that MDI Gurgaon this transient growth in sales will have a colossal effect on the image of the brand. In 1980s, Pierre Cardin (a haute couture brand) was hit with a jolt when Pierre Cardin started appearing on Caps, cigarettes, thus hurting the luxury status. The Case with Iphone mini is very much the same, Apple is trying to make a mark in the fastest growing segment of the society and may be later help them straddle to high end products of Apple, this concept is called Firewalling, where a premium brand brings its own product in lower category to stave off other competitors from stealing part of its pie (Barbie from Mattel did the same thing to ward off other low cost players). It is important to understand that IPHONE resonates with “STATUS”, “PREMIUM” and this attempt will send all this for a toss and bring it from premium to economy segment, thus IPHONE will no more be aspirational. Having said this, it does not mean that Apple should leave this high potential growing segment but it should come with a new brand (For eg. Gold Plus is economy spin off from Tanishq and so is Ginger Hotels from Taj) in this category instead of using IPHONE as an endorsed brand thus repeating the mistake that Pierre Cardin did three decades back.

markathon|july 2013

Beginning of this year, reports started pouring in about a possible launch of a “cheap” iPhone, a huge debate started: whether Apple should or shouldn’t venture into ‘low’ cost smartphones. A brand famous for iconic products and innovation, considered as “premium” and “aspirational”, question is why such a decision? A look into statistics by Gartner Hriday B. Das (May 2013), Apple has steadily IIM Shillong lost its market share, worldover, both in smart phones and also OS wise, from 22.5% in 2012Q1 to 18.2% in 2013Q1. Reasons are many, starting with the saturation of “premium” market, no big recent launches by Apple and lately, growth has shifted towards emerging markets like India and China where, in general, consumers cannot afford high priced phones. Critics of this move are of view that it’s against Apple’s existing strategy which will lead to brand dilution and dropping of margins. But considering the condition and looking at future, the move is a good move. All these years, by being branded as a premium category product, Apple missed out the growth of the other segment. Its decision to introduce smartphones below $200 will surely lead to erosion of margins, but positives are, it’ll also have share in emerging markets where sales by numbers will ensure that it has healthy profits. Apple’s strength is its brand and in the past it has been successful in innovatively branding of its product. For the present, Apple will surely live up to its image and come up with its own unique way to ensure that dilution doesn’t happen. Examples are available where in products have failed while going for extensions, but that’s a challenge for Apple. Greatness of a company lies in overcoming challenges and coming out with offerings which are unique. Apple has been doing all these years and will continue doing that.

It is against Apple’s existing strategy which will lead to brand dilution and dropping of margins

iPhone resonates with “status”, “premium” and this attempt will bring it from premium to economy segment

war zone | eye 2 eye

Topic for the next issue Eye to Eye: “Lok Sabha election 2014: Social media followers a potential votebank or just a virtual army?” Your opinion (view/counterview) is invited. Word limit is 250-300. Last date of sending entries is 26th July, 2013. Include your picture (JPEG format) with the entry. 18


markathon|july 2013

war zone | silent voice

Silent Voice

LAST MONTH’S RESULTS Theme: “NJOY e-cigarette”

WINNER: Pankush Kapoor and Saurabh Kumar NIRMA University Congratulations!!! Pankush and Saurabh receive a cash prize of Rs 500!

Bitheka Jena | NIT

NEXT THEME FOR SILENT VOICE: “Coca Cola 150th year Special Limited Edition” LAST DATE OF SENDING THE PRINT AD: 26th July, 2013 EMAIL ID: markathon.iims@gmail.com Send your entry in JPEG format named as SilentVoice_<Your Name>_<Institute>only This time we will follow this rule: 30 % weightage will be given to the popularity of your print ad on Facebook  We will upload your entries from 22nd July; send the respective link to you; you need to share your entry and get as many likes as possible for the same before 6 AM on 29th JULY Remember, only creative and whacky stuff sells on Facebook !! And prize money is Rs 1000 19


specials | ADdicted

markathon | july 2013

Ad-dicted Swikruti panda | iim s

Sushree tripathy | IIM S

PRODUCT: Garnier Pure Active

PRODUCT: ITC Classmate

POSITIONING: “No pimples No marks”

POSITIONING: “Because you are one of a kind”

CREATIVE AGENCY: Foxymoron

CREATIVE AGENCY: Rediffusion-Y&R

YouTube Link: https://www.youtube.com/watch?v=abR5OvwagN8

YouTube Link: http://www.youtube.com/watch?v=RAMukaV1qAA

CONCEPT:

CONCEPT:

The ad has been articulated targeting the college going youth. The ad features Alia Bhatt cribbing over various issues faced by a teenage girl like pressure of studies, turmoil in love life and most importantly pimples that pose a severe threat to her looks and personality. The ad further unveils the specific cause the product is supposed to serve i.e. marks that are left after the pimple heals. Then the product is flashed. Finally, the product blesses Alia with an absolutely clean skin and everyone around is shown to be in state of awe as “No marks, no marks” hums in the back ground. VERDICT:

Taking forward their campaign, ‘Because you are one of a kind’, ITC Classmate has attempted to associate the brand with the powerful insight of children taking their initial steps towards expression of their individuality. The 60 second ad film shows a 10 year old girl Tara, living in the hills of North-East India secretly writing something in a book across different settings. After many rounds of secret iterations, she finally draws inspiration from a swirl of ribbons flying during a local festival and makes another entry in her book. As she shows it to her grandfather, it is revealed that Tara had been trying to create her unique signature using her ITC Classmate pen all along and that she finally had.

Catch/Miss- Miss

VERDICT:

It is a smart move by Garnier to make Alia Bhatt the face of a product that targets mainly the college going students. But merely a relevant face will no more do justice, as today the face that sells, often endorses many products in the same product category. So, in face of the creative ads that Maybelline comes up by taking Alia on board, Garnier has gone belly up. Merely pitching for great skin is clichéd. Audience will get a glimpse of Alia and be grateful to Garnier for fetching them the same. If you ask them to make a purchase under the influence, they would not shy away to cut a sorry figure. It is high time Garnier realizes that it is important to design campaigns that will engrave Alia with Garnier in the minds of the target and for that, a strong theme or story line is indispensable.

Catch/Miss- Catch The ad beautifully captures the powerful simplicity of a child’s endeavor towards his earliest expression of identity through the creative portrayal of a ‘Dastkhat’ or signature. It captures the sense of empowerment that children approaching their teens feel when they start using pens for the first time in school and secretly attempt to create their signature. The production unit is commendable with an endearing cast, music track and a North Eastern bend that gives it a fresh appeal breaking through the clichéd visuals of schools and corridors. A revolutionary idea that transcends cultures, it positions the brand as a trusted and honest companion in the minds of their target audience at this phase of their life.

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specials | bookmark

markathon | july 2013

INSIDE COCA-COLA

A CEO’s life story of building the world’s most popular brand

-Neville Isdell with David Beasley Review by Pallavi Price Rs.389

“I have a belief system that when the Good Lord created the world, he created Coke one and Pepsi number two.” That is Neville Isdell for you, pulled out of retirement in 2004 to lead Coca Cola as the CEO in the most turbulent times in the history of the company. “Inside Coca-Cola” is the first book by any CEO of CocaCola opens a window to the personal and professional life of Nisdell which can be appropriately dubbed as a globetrotting story, starting from Northern Ireland to South Africa to Australia, the Philippines, Russia, Germany, India, South Africa and Turkey.

Summary The book chronicles Neville Isdell’s journey of 30 years as a key player at Coca Cola which started at a coke bottling plant in Zambia and culminated as its CEO in Atlanta. Born in Ireland but brought up in Africa, Isdell is clearly passionate about Africa and its people, be it protesting against apartheid as a student at Cape Town University or appointing South Africa’s first black sales manager, he reveals his sensitivity and compassion and also a hint of the business acumen that would take him places in the coming years. Rugby was another passion he lived by, an inextricable part of the world of Isdell’s youth. He also goes on to describe how his rugby skills won over the Afrikaners’ managers who resented an "Englishman" heading the Coca-Cola bottling operations in South Africa. The book describes not only the business challenges that Isdell faced on his climb up the company’s ladder but also the challenges he faced in operating in various foreign cultures with coke’s turnaround in Philippines being a great example. Isdell retired as head of Coca-Cola Hellenic Bottling Co. in 2001. By then, Coca-Cola was struggling, having been led by several unsuccessful CEOs after the untimely death of legendary Coke CEO Roberto Goizueta. Its earnings and stock price were depressed and it was reeling from what Isdell describes as a “culture of arrogance”. It was then that he was called to the rescue of the company in 2004.

Using the manifesto of growth built on five principles of “People, Product, Partners, Planet, Profits”, Isdell was successful at the task at hand yet again, leaving behind a remarkable legacy of knowledge and accomplishment. The final chapter in the book highlights his continuing efforts to help make the world a better place through what he calls "Connected Capitalism” - a true marriage between government, nonprofits, and global corporations to fight disease and poverty, heal the planet, improve education, and, ultimately, boost private-sector profits.

Organization The book is divided into eight chapters. The first seven can be looked at as major milestones in the life and career of Neville Isdell while the last one is on “connected capitalism” which highlights the importance of being connected with the local community and giving back to it.

Verdict: 3.5/5 With a title as tantalizing as, “Inside Coca-Cola: A CEO’s life story of building the world’s most popular brand” one expected a chance to understand the inner workings and the strategy that makes Coca-Cola one of the most powerful brands, especially since Isdell led Coke during a time of tremendous change in the world - fall of the Berlin Wall, the freeing of Nelson Mandela, as well as in the soft drink industry - the decline of returnable bottles, the rise of the "anchor bottler," the growth of juices, teas and waters and when the company itself was reeling under a series of controversial incidents. Also, given the fact that Coke was one of the first “marketed” products, even credited for our modern day image of Father Christmas, there is no detail of any type of marketing.

Bottom-line The book is essentially a travelogue of Isdell’s assignments around the world and the people he met and worked with, and throws some light on his personal life as well. It is an easy read and can be labeled as interesting enough, strewn with some poignant anecdotes like meeting Nelson Mandela and retrieving a piece of the Berlin Wall. But if you are looking for a genuine INSIDE look into Coca-Cola, the book is not for you.

21


specials | radical thoughts specials | radical thoughts

CONTROVERSY IS BAD. Ashok A | IIM S There is an old marketing axiom, which says advertising’s greatest enemy is not rejection, but indifference. Marketers and admen of late seem to have taken a strong grip of this axiom. Instances of provocative and controversial ads appearing have increased many folds in the past decade. But marketers fail to realize that a surge of publicity created by a controversy will not serve the cause of brand building in the long run. And I do not completely disagree about the good a controversy can do to the brands. When I say this, everyone’s mind would go searching for one brand. United Colors of Benetton. UCB has been controversy’s child for a very

long time. Its ad campaigns were intentionally formulated to target most sensitive issues of the period. It is, of course, hard to deny the gains made by Benetton due to the campaigns. But it is equally hard to deny the fact that it lost its customers who took offence because of such campaigns. It will be a cliché to call a controversy in marketing as a double-edged sword. But that is what it is.

markathon | july 2013 markathon|january 2013 have created a positive press and publicity mainly because of their targeted audience, like you and me. We love to be a part of controversies and rebellious campaigns. If Benetton has to reposition itself in future to more business positioning or uptown fashion brand, its current ad campaigns will definitely act as a barricade. This will be the case with any brand that takes up controversy as a short route to publicity. Even brand names, which are mired with controversy, are destined to same fate. Take for instance, French Connection, was known for selling upmarket fashion accessories to fashion conscious British business population. But when the company wanted to target teens, they rechristened as French Connection United Kingdom, popularly known by its acronym FCUK. By doing so, it gained popularity among the teens but distanced itself away from certain segment like parents. My parents never allowed me to wear a tee shirt with swear word on it. Though I have taken all examples from fashion world, it can be true for other sectors also. PepsiCo’s Mountain Dew unsuccessfully tried their luck at controversy with an ad, which was accused of racism. Negative effect of controversy can shatter your hard built brand. As Google’s Dan Cobley puts it, hypotheses can never be proved, but only disproved. You can keep on building the credibility of your hypothesis, i.e. your brand, but you can never prove that you are brand. Rather a small spark of controversy is capable of disproving your hypothesis. Marketers have to understand that not all publicity is good and not all viral is good. The effort that would be spent on a negative aftermath can be directed towards useful brand building, which will be sustainable. No brand wants to be ignored. But I think marketers sometimes forget whey their brands exist, and who they’re trying to serve.

Any brand (almost every brand) will at some point of time have to be repositioned to cope with changes in consumer behavioral trends. Especially in Fashion Industry, repositioning is a common phenomenon. When Burberry tried to reposition its position as an authentic British wear to more democratic positioning, they had a tough time because of their previous British based ad campaigns. UCB’s campaigns

10 22


markathon | july 2013

specials | updates

By Prateek | IIM-S

BRAND LAUNCH Make way for Porsche The German auto giant is ready to set the ball rolling for premium segment auto manufactures with its launch of second-gen Cayman S in India. Porsche is banking on the brand name of Cayman series which is among the finest handling cars ever made. Priced at around 93 lakhs, this baby from the luxury car maker is sure to drill a hole in your pocket.

Personal care segment smells up with ‘Engage’ The home-grown FMCG giant ITC in its effort to expand its product portfolio has ventured into the competitive deodorant segment with its offering, Engage. The deodorant highlights playful chemistry between the couples which is evident in the silhouettes designed on the bottles. The packaging also seems innovative intended to capture the minds of youth.

After ‘Atom Bomb’, Pepsi’s top management tumbles With a rather shabby response to Pepsi’s latest offering and a poor reception to Pepsi’s IPL campaign, its India head Manu Anand resigned from the helm after serving in the company for 19 years. This comes as a major hit to the cola maker amidst news of promotion of Coca cola India chief.

India Themed Gallardo makes inroads The super luxury sports segment got its India avatar in form of a special edition sports car launched on theme ‘India’. The German car maker has launched only six cars giving exclusivity to its buyers and is set to make them poorer by a jaw dropping 3.06 crore. Amidst turbulent times in the automobile industry, Lamborghini sales shot up from 14 in 2011 to 17 in 2012.

MEDIA

The heat is on with Kindle Fire HD

Radio gets the ‘i’ flavour

‘Earth’s Largest Bookstore’ is all set to introduce its latest version of tablets, Kindle Fire HD 7 inches and Kindle Fire HD 8.9 inches. Customers will be able to get their hands on close to 2 million apps and around 325,000 books which are exclusive to Kindle store.

Technology Czar Apple introduced its radio service called iRadio Service. It promises to feature content from various labels and artists. The upcoming Ios7 will feature the service free of cost and the customers will be allowed to customize their own radio stations by genre, skip songs and access for free around 200 service stations making it a musical experience for customers.

BRAND WATCH

Tri Color flying high at Cannes Lions

Repositioning Reality with Reebok The sports goods maker from the stable of Adidas is making a comeback in the premium segment after hit by controversy. Reebok plans to launch around 100 fit hubs called ‘Reebok Fit hubs’ aiming to provide fitness consultation to customers. The company has also roped in two Bollywood actors as their brand ambassadors along with Gautam Gambhir as part of their brand building initiative.

The Indian media agencies had bagged 23 awards on day four of Cannes Lions International Festival of creativity 2013. The awards were given in category of Press, Design, Cyber and Radio. McCann Worldgroup bagged two Gold Lions in Press category, whereas Taproot earned a Gold Lion each in the Press and Design categories. Also Grey Worldwide earned a Gold Press Lion while Ogilvy & Mather won a Gold Lion in the Design category.

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markathon | july 2013

specials | updates

AD Watch

effectively connects with its target audience and promotes Red Bus as one stop shop for bus ticketing solutions.

Aircel: More for Less The ad featuring Indian Cricket Captain Mahendra Singh Dhoni prays on the idea of joy on getting more than expected. In the ad, the guy looking for an autograph for Dhoni feels overjoyed when he gets Dhoni’s cap apart from the autograph. The ad effectively communicates the feeling of delight when we get more than what we expect. Youtube Link: http://www.youtube.com/watch?v=dCu83K7Nq54

RedBus With a series of small ads, red bus tries to communicate the essentials provide by the bus ticketing company. The ads ranging from featuring an old couple in need of an immediate bus ticket to a pregnant women looking to travel to Goa checking the various bus rating,

Youtube Link: http://www.youtube.com/watch?v=4kXpcBxSeaY

Cadbury Bounville Not so Sweet: After smart positioning of chocolate with tagline ‘ You don’t buy it, you earn it’, Bournville came with a surprise with its new positioning of ‘Not so sweet’. Though the message is loud and clear and hits directly at the target segment, it seems as if the ad was not meant for Indian consumers and is directly put here from some other market. The same message could have been delivered in a much better way. Youtube Link: http://www.youtube.com/watch?v=ChY610zS94g

Articles are invited “Best Article”: They receive a cash prize of Rs.1000 & a letter of appreciation We are inviting articles from all the B-schools of India. The articles can be specific to the regular sections of Markathon which includes:  Perspective: Articles related to development of latest trends in marketing arena.  Productolysis: Analysis of a product from the point of view of marketing.  Strategic Analysis: A complete analysis of the marketing strategy of any company or an event. Apart from above, out of the box views related to marketing are also welcome. The best entry will receive a letter of appreciation and a cash prize of Rs 1000/-. The format of the file should be MS Word doc/docx. We’re inviting photographs of interesting promotional events/advertisements/hoardings/banners etc. you might have come across in your daily life for our new section “The 4th P”. Send your self-clicked photographs in JPEG format only. The last date of receiving all entries is 26th July, 2013. Please send your entries marked as <ARTICLE NAME>_<SENDERS’ NAMES>_<INSTITUTE> to markathon.iims@gmail.com.

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markathon | july 2013

logo

Marketing Club of IIM Shillong is extremely proud to unveil its logo. Apart from portraying the essence of Marketing, i.e. the relationship between a customer and a marketer, use of red color signifies dynamism and intensity which are inherently associated with the domain.

Live Marketing !

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markathon | july 2013

Credits: Vaibhav Annam

picturepage

Credits: Monika Perumal

View of the magnificient Umiam Lake near Shillong

Shillong at Dusk 26


Please send in your comments/feedback to: markathon.iims@gmail.com Visit: www.iims-markathon.in

Š Team Markathon, IIM Shillong

Markathon_July 2013  

Monthly marketing magazine of IIM Shillong

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