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Opportunities and barriers of Augmented Reality in retail/ e-commerce industry BY Kiran Kumar P IIM Rohtak

There has been a perception by most of the people where Augmented Reality and Virtual Reality are two technologies which compete against each other. But they are the two faces of the same coin. Both are needed to gain ahead of the competitors and to gain and retain customers in the retail industry. In this case, few opportunities and barriers of AR technology in retail/ e-commerce industry will be discussed. The time when people wondered about AR/VR technology has gone, since the advent of numerous apps in smartphones in the current world and also the use of these technologies in various industries including but not limited to video games, real

estates and fashion industry, etc. The market size of AR and VR industry worldwide is estimated to reach $215 billion by 2021. The benefits provided by these technologies make them experience exponential growth shortly. For those who are still confused about what is the main difference between AR and VR technologies, the below examples would help them clear their mind. Augmented Reality (AR) Case: You wanted to know whether the dining table you are willing to purchase suits your kitchen or not. You open a specific app and turn on camera facing the floor in the kitchen

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where you want to place the dining table. customers required more personalization The display in your smartphone shows and needed more information and your kitchen room along with the table attention from the retailers. you wanted to buy. Adding to that, you can change the features of the table, such as color, design and even the table too. This experience can be achieved using AR “There has been a technology. Virtual Reality (VR) Case: You wear a perception by most of Google cardboard or Samsung Gear VR the people where and start viewing a video or playing an immersive video game, where the entire Augmented Reality and world is virtual, not at all connected to the Virtual Reality are two real world. You can interact with the virtual world, but it has nothing to do with the technologies which real one. One can refer this to VR technolcompete against each ogy.

Augmented Reality Many retailers have already started using AR, but not to the maximum potential. The world has become more service oriented from being product oriented. The

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other. But they are the two faces of the same coin.�


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The conversion rate for online retailers: From past few years, people started moving from offline shopping to online shopping for its convenience and saving of time. But, the underlying fact that the conversion rate for brick and mortar stores ranges from 20-40% whereas it is mere 2-4% in case of online shopping/e-commerce is astonishing. One of the primary reasons for this difference is the lack of having hands-on experience with the products.

Better experience in brick and mortar stores

As offline retailers face lack of proper product information, which is the primary advantage of online shopping. American Apparel, a famous clothing brand has launched an app, where the customers can know a lot of information about any apparel, just by scanning that particular apparel with the app. Some brands have also used AR mirrors to let customers try AR can help the customers to have a com- the products on more conveniently. One plete 360-degree view of the product and example is Timberland, which had a virtueven some companies like Lenskart using al fitting room created with Kinect the same technology in assisting custom- technology as shown in the below image. ers to get the best fit of contact lens, which Shoppers will simply stand in front of the is a huge mirror and can see a virtual picture of success. themselves and can try different apparels depending on the size, color, and design, etc.

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Barriers to entry: High cost: Implementing AR technology involves high price as it needs to be integrated into the entire product range in the company. Despite the fact that the implementation helps in the long run, one needs to spend a vast sum to start using AR. Return on investment: Even though many companies have already started using this technology for better customer experience, the return on the investment they made is not satisfactory. In case of small and medium brands, this becomes a significant barrier to entry into this technology. Technical support: As AR is in initial stages of development,

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it is tough to have enough expertise in designing AR tech, which involves high cost too. Maintaining technical staff adds more burden to the company regarding money.

AR can help the customers to have a complete 360degree view of the product


RIGHT TIME MARKETING! Marque - The Marketing club, IIM Rohtak

“The thing is to outlast trends” – Paul Anka. These words of the famous Canadian musician resonates the best with the marketing world and rightly so. Disruptive trends have always influenced the way we marketers build businesses and sell products and the rapid pace at which technological trends have influenced the way we can gain insights about consumer behavior have thrown up newer opportunities in marketing strategy. Modern marketing is basically structured around two important pillars – understanding the individual consumer behavior and mapping them with our customized offerings. As simple as it may sound, it is that difficult to implement it as the key is to understand the minds of each consumer and interpret it in the correct context. The most important context is time. What is my consumer thinking right now and how can I influence that process of thought at that very moment? This question leads us to the most disruptive trend in marketing today – “Right Time Marketing.”

BY Preetam Bhattacharjee SIBM Pune sumer behavior and derive accurate conclusions. We need to study the consumer both in the physical and online world. Let us take an example in the retail space. A consumer walks into a store and navigates through the shelves. Through cameras installed in the store, we can assign a unique ID to each new customer or an existing ID to returning ones based on past associations if any. Through video tracking algorithms we can map the places each consumer is visiting, which shelf he/ she is spending the maximum time on, the item he/she picks and the items they put back into the shelf after checking the prices . Once we have this data, we can generate heat maps for the shelves generating maximum consumer interest. Through RFID tracking we can chart out the most traversed path in the store by our consumers. An additional tracking parameter is analyzing the eye patterns of the consumers by field cameras This can also serve as a dataset for consumer interests as we can derive relationships between eye fixations and consumer choice considerations.

We will elaborate on the implementation of Right Time Marketing by answering ways to address the two parts of the question asked. The first- “What is the consumer thinking?” One does not need to mastermind reading techniques to do that. The key is to observe and analyze con-

In the online world, analytics engines can track online behavior by tagging a customer across website visits. The most common analytics engine, Google Analytics has powerful tools to derive consumer insights based on consumer characteristics and activity.

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Heat Maps generated by video analytics at a retail store to track real-time customer interest

The second part of the question is “How do I influence the thought process” or to put it under more precise terms “How do I influence the purchase decisions of the consumer” once I have the above data. The answer is to target the individual consumer by a customized marketing strategy based on his interests at that very time. This is the game changer. Instead of an interruption based sales pitch, we make an offer on a product the consumer already has on his/her mind. As an example, a consumer is considering buying shoes, and at that very moment, we make an offer on the particular pair of shoes in which the consumer is interested the most. This can either be done by an in-store representative or through a customized message delivered to the phone or email if we have the consumer contact data. In the online

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“The most important context is time. What is my consumer thinking right now and how can I influence that process of thought at that very moment? This question leads us to the most disruptive trend in marketing today – “Right Time Marketing.”


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and predicts future customer purchases in a timeframe. It ships the product to a nearby delivery center to shorten delivery times and all this even before the order is made by a specific consumer, a concept it has filed a patent on, “Anticipatory shipping: Ship before you buy.� American Express, the global payments firm to has developed a powerful model to predict the timing of individual customer churn so that it can target customers more precisely. The central theme across these examples is the same. Companies are using advanced datasets or analytics capabilities to cusWhat are some of the companies today tomize product offerings or make predicwhich are using these advanced techtions at the individual customer level at niques? One of them is Kohl, which makes the right time. customized offers at the right time to Thus the present and future of marketing consumers based on geospatial data or choice considerations by tracking through can be stated that it will largely involve uncellphones similar to video tracking. Am- derstanding individual customer choices azon tracks customers’ behavioral history and make personalized offers at the right space too, based on browsing and choice consideration history, targeted marketing offers can be made to consumers. An interesting concept here is remarketing, which targets consumers once they have left the websites through post-visit offerings to bring them back to the immediate aftermath. All of these leads to a better chance of increasing sales as personalized offerings will lead to more revenue and increased loyalty as predicted by a recent study by Accenture and a survey of active consumers.


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moment to derive maximum sales. A large part of marketing will be dedicated to leveraging technology regarding analytics, video-tracking, spatial tracking, behavior analysis, online activity analysis to make the right offer to the right consumer at the right time. The firm which develops these capabilities early will edge out its competitors and as Paul Anka said will outlast the trend.

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“Thus the present and future of marketing can be stated that it will largely involve understanding individual customer choices and make personalized offers at the right moment to derive maximum sales�


CONTENT IS NOT GREAT UNTIL VIRAL

Marque - The Marketing club, IIM Rohtak

BY Shashank Jindal IIM Rohtak

In today’s digital era, we are consuming information in the order of zettabytes (1021 bytes) and at every moment huge amount of data is being processed. But in that huge pile of content, what goes viral is just a grain of rice.

As rightly pointed out by Mr. Vinay Singhal, Founder, Wittyfeed, that content becomes great when we hit the nerve of its target consumers, and once we can pick that right note then virality accompanies automatically. This was Predicting what would go viral is extreme- the strategy which he followed for gainly difficult - there are many pieces of great ing a market share for Wittyfeed in the content which hit the bar of virality and content world and has been successful in there were many others too that could not implementing the same. garner even respectable reach. Now here arises a question that what makes a partic- But just like a coin has two sides, so is the

ular content go viral? And is it this virality factor that makes a content qualify for being called as a great?

case with virality too. Sometimes the parameter to judge a content comes from its share of virality and a prominent example

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tion. So in simple terms, one should not be playing it too safely. To evoke high levels of arousal such as awe, surprise, amusement, anger or anxiety, one needs to be pushing the boundaries and giving something highly original.

Hence quality and to some extend quantity does not of this case is the infamous “Dhinchak serve as the primary tool to mark conPooja” whose success has reversed the tent as great. As a good product with no calculations of all the marketing pundits. Hence it can be inferred that the key to vi- marketing tends to bring losses, a piece of information not able to make a bang fades rality is the level of arousal of the viewer/ reader – the more aroused they are, more away. As people accept the information, is the probability of them sharing the con- the news becomes viral. And this helps the tent; even content that is unrelated to their CONTENT to be certified as GREAT!! mood. It’s a known fact that people share content to entertain others and surprising and interesting content is highly viral. Similarly, consistent with this notion is that people share content to inform others or boost their mood. These effects are all consistent with the idea that people may share valuable content to help others, generate reciprocity, or boost their reputa-

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"The Art of Marketing, the promotion and the art of story defenitely elevated and we ha better every year"

-Tinker H


e art of ytrlling is ave to get

Hartfield


#BUZZFEED

Google Invests $550 Million in China E-Commerce Giant as More Big Firms Put Up a United Front against Amazon

Google announced on Monday that it will invest $550 million in cash in China’s second-largest e-commerce company, JD.com, opening the door for the latter to get in front of U.S. consumers and securing the tech giant’s stake in Asia’s rapidly growing e-commerce market. The partnership is the latest evidence that some of the world’s biggest companies are putting up a united front against the twin threats of Amazon and Alibaba, the Hangzhou-based conglomerate with a market cap north of $500 billion and ambitions in luxury fashion, tech-powered physical retail and cutting-edge AI

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Colgate reaches out to Mumbai’s taxi drivers through its Oral Health Month program for its new marketing gig

TGBL has approached key shareholders of Hector Beverages with a proposal to buy out the company along with its popular brand Paper Boat to spice up its portfolio. Even though a formal approach has been made, the talks around Paper Boat are still at an exploratory stage and there is still no guarantee that it will lead to a transaction. However, Kakkar has categorically denied any discussion with Tata Global Beverages or a possible sale. Paper Boat, if the Tatas buy it, will be a big break in the long narrative of western cultural dominance when tea and coffee were trendier than desi drinks which were confined mostly to kitchens except a few such Rooh Afza. If Paper Boat is deemed fit to sit with Starbucks and Tetley in the Tata Global Beverages’ portfolio, it sure is a signal that ethnic drinks have become upmarket—thanks to the stupendous success of Patanja-

Colgate, the market leader in Oral Care, partnered with Indian Dental Association (IDA), offered free dental check-ups and dental treatments to taxi drivers at the GVK Chhatrapati Shivaji International Airport, Mumbai. Colgate and IDA organised these special camps following a survey report that stated: Taxi drivers consume tobacco in various forms to stay awake while driving; 35% of the drivers showed early signs of oral cancer due to tobacco consumption; while 64% of the 400 surveyed drivers consume tobacco and its products like khaini and paan masala. (Source: Research study by Mishra GA et al from Tata Memorial Hospital, Mumbai). This initiative was an integral part of Colgate’s Oral Health Month program and the brand’s objective to Keep India Smiling. The Dental Camps were set up near the taxi stand at the airport to make it convenient for the taxi-drivers to avail a check-up without compromising on their working hours.

Amazon acquires online pharmacy PillPack in move into health care li Ayurved

Amazon is jumping into the online pharmacy business, signaling the company’s plans to upend the traditional market for prescription drugs amid serious concerns about health care costs. The tech and retail giant announced Thursday that it is acquiring Boston-based online pharmacy startup PillPack, which sorts and delivers medication, including refills. The move makes Amazon a serious player in the lucrative but complex market for pharmacy services. For Amazon, PillPack was appealing, in part because it’s already licensed to sell

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prescriptions in 49 states. The company also offers drugs through major pharmacy benefit managers, including CVS Caremark, Express Scripts and Optum Rx. For consumers, it could be good news if the deal nudges the pharmacy sector into a heated competition for customers, potentially driving down drug prices. Prescription drug spending tops $450 billion annually, according to the Pew Research Center.

Virat Kohli aims to inspire millions of driver partners in India with Uber India’s ‘Badhte Chalein’ campaign

Uber, the ridesharing app unveiled the second leg of its recently launched India brand campaign – ‘Badhte Chalein’, featuring brand ambassador Virat Kohli. ‘Badhte Chalein’, has been envisioned around the brand’s new positioning that is intended to build Uber as an enabler of movement in order to ignite opportunity for all to progress in life. The driver forward brand film, focusing on the driver partner community features Uber’s tenured driver partners from all walks of life.


#BUZZFEED Personalisation: The New Era of

Coca-Cola Marketing plans to boost muscle with Horlicks buy

Coca-Cola is set to join global consumer food giants Nestle, Danone and Hindustan Unilever and others in the $4-billion-plus pursuit to buy GlaxoSmithKline’s consumer nutrition business, people close to the development said. This marks an entirely new Personalised marketing advocates forcould fitting ofitatbandwidth least onetoparts foray for the Atlanta headquartered firm and give play inof thethe pure health-nutrition space aimed primarily children, these people Coke has manassociation’s advertising blend toatthe individual client.added. Personalised mardated Citi to help them in the competitive bidding process expected to launch next keting shows an extraordinary division, with an objective section of size week

one. There are two types of one-to one marketing: personalization and customization. Personalization is the point at which the firm chooses, generally in light of beforehand gathered client information, what marketing blend is appropriate for the person. A decent illustration is Amazon.com’s customized book and music suggestions. Amazon utilizes cooperative sifting figuremost out successful what music or books to prescribe to as its a SoundLogic has roped to in India’s captain, Mahendra Singh Dhoni, customers. Systems of large-scale beliefs of Indian standardizapartner-evangelist. As SoundLogic looks manufacturing, to build on its presence in the market to enter new segments and build marketshare, MS Dhoni will fits-all be an integral part mindof the tion, working on efficiencies, and the one-measure creation journey. set have driven in the past to rationality of business that burdens pitch“Music drives me to do more on and off the field and there is no better fit than Sounding a standard itemproducts. to however shoppers as would be prudent. Logic’s range of audio Rightmany from the first meeting with Sagar and team, I realized that thiswho is a group young professionals with abuyers clear and ambitious roadmap. I Advertisers try toofrecognize and achieve more absolutely am excited to bea part of theirdraw. journeyAccordingly, and I am sure there consumers will also be as enthusihave applied contrary has been a continuous astic about the products as we are,” says Mahi. move in showcasing thought and practice: mass promotions, mass mar-

Mahendra Singh Dhoni to start new innings with SoundLogic as its partner-evangelist

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MARKETING IS A TRICKY BUSINESS Marque - The Marketing club, IIM Rohtak

BY ISHA GARG IIM Rohtak

“There are instances when fictions become facts, and there are other instances, in the same market, where facts can’t win arguments.” Being a writer, I always get my article or any other piece of writing read by one or two of my friends, before official publishing, to know their viewpoint. Why? Because when we read or watch something, we choose to pick our own side of the story. It is astonishing how perspectives of a writer of an article and that of a reader can differ significantly. An author can never interpret how the readers will view his article. Same is the case in marketing! It takes endless research and thought to put together an advertising or a marketing campaign. But what most marketers miss at times is to analyse the viewpoint of their viewers, which may lead to disastrous results. Marketers have been latching social issues to promote their products from quite some time, but many a time, they end up giving the world another example of the so-called “backfire effect.” A number of well-established brands like Dove and Sony help us prove the same. A much-known brand like Dove has initiated much debate among various com-

munities at various occasions. It has displayed the uncertainty of author-reader relationship in most effective and expensive ways, be it while launching a new packaging to celebrate body diversity (which actually humiliated many people rather than honouring them) or launch of ad campaigns showing magical transformations from a dark skin to white skin (which led to boycott of Dove in many countries). A similar thing happened with Sony when it used black and white models as personified PSPs, showing a black PSP(model) being subjugated by a white PSP(model). The campaign went viral, no doubt, but it led to immense PR firestorms and negative feedbacks. Where on one side, the above examples show how lack of secondary thinking led to disastrous results for companies, there are cases on another face of the coin where such steps led to incentives for investors. Such instances remind me of something known as “Cobra Effect.” An anecdote from British Colonial time in Delhi states that once, the British officials announced money rewards to anyone who brought them dead cobras, to eliminate the venomous population from the city. But can you guess what happened next? The cunning Indians started breeding cobras at their homes! And it did not stop there. When the government came to know about the shrewd plan, they withdrew the

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scheme, which in turn led all the cobra breeders to set those cobras free. It led to an increase in cobra population to even a greater extent than before. This “Cobra Effect” is what modern marketers call as the “Backfire Effect.” An article in Economic Times reminds me of a famous investor Jim Rogers, who stated that “you can either control the supply of a product or service, or its price, but never both of them”. The simplest of explanation being that a limited production below actual demand will directly lead to a black market and lucky allottees will sell their allotment letters several times at much higher prices than the set maximum price (as happened in case of Bajaj Auto scooters). A similar phenomenon is bound to occur due to a recent cap put by the government on price of stents used in a heart surgery. The announcement immediately led to withdrawal of stocks of stents from market, leading to an immediate shortage. Isn’t it like shaping a pathway for black markets with our own

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hands? This happens due to the lack of efforts put in thinking about second and third order effects of such decisions and campaigns. The Backfire effect is something that has been happening for years, and yet the marketers fail to foresee the long-term effects of their strategic campaigns correctly. Hasty decisions lead to more than just monetary losses. It can jeopardize brand credibility and lead to irreparable PR losses. All it takes to avoid this is, “relax, pause and reflect” and ask yourself all the possible questions which a viewer could generate in his mind after watching your advertising campaign. Ponder if someone out there can incentivize at your cost with your current strategy. As Mr. Arun Jaitley pointed out in an interview, “One of the key elements of a good system design, therefore, is to avoid creating incentives to game as much as possible.” An inquisitive mind would ask, “didn’t he think on the same lines before implementing demonetization and GST?” But anyway, that’s a


REFURBISHED PRODUCTS TRENDS IN INDIA Marque - The Marketing club, IIM Rohtak

BY Sunder Raghavan B IIM Ahmedabad

In India, e-commerce is booming with 186 million users and is expected to become the second largest e-commerce market in the world by 2034. Meanwhile, the online marketplace has made it easier for the customers to return the products without any hassle. Hence, in some categories of online retail, the return rate goes up to as high as 50%. These unused products cannot be sold again in the forward market for full price. But these are brand new products which were unsealed, unboxed and returned to the seller by the buyers. The returns also cause a huge monetary loss to the sellers in the form of shipment fees by the logistics providers, processing charges by the marketplace, in addition to a loss in value of the product. Of late, the “No-questions asked� returns policy is being heavily opposed by the sellers in the online marketplace. It is seen as giving an undue advantage to the customers who can easily cancel their orders until after 30 days of delivery. (Most e-commerce platforms offer this option) Unlike in the Western world, in India, there is a tendency to treat the goods as scrap once they are purchased and returned to the seller, even if they retain their usability. Except for the

automobiles industry, the resale value of the goods is highly uncertain and deeply depreciating in nature. The value of a returned product drops by 30-40% of its original value within few days of its purchase. This makes it more difficult for the Indian e-commerce companies to deal with the returned goods. The brand new smartphones usually come in sealed boxes. The returned packages have broken seals and become second-hand phones without actually being turned on even once in their lifetime. It locks up millions of rupees and blocks the warehouses of even the e-commerce giants in India. It has been of concern to the online retailers in India. But, heavy competition in the online marketplace makes it necessary to continue such extreme pro-customer policies. Marketing the returned goods poses a real challenge to the e-commerce companies. There was an apprehension whether selling refurbished goods would dilute the authenticity of the new products being sold on the platform. Recently, many e-commerce companies have started selling such returned products (mostly electronic goods) under the refurbished category. Refurbished goods

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include the returned/used goods which are tested for defects before being sold again in the market. Once the returned smartphones reach the warehouse from the customer location, they are tested for all the major functionalities and graded accordingly. The refurbished smartphones are usually sold at 65-90% of their original selling price. The brand new products that are returned by customers due to change of mind are sold in the “Unboxed” category at around 8090% of the original price. The smartphones returned by the customers due to minor defects are tested for faults and rectified in the refurbishment centres. The processed phones are graded as Good/Acceptable phones and are sold at around 65-85% of the original price. Notable e-commerce companies like Amazon, Snapdeal, Shopclues etc., list refurbished electronic goods (especially smartphones) in their websites. According to Amazon, refurbished smartphones category is growing at 400% year-on-year. Its target segment is the aspirational buyers who are interested in smartphones that are out of their budgets. The online retailers also offer warranty for the smartphones they process in their refurbishment centres. Quality goods at lower prices will encourage many people to opt for highend models which they could not afford to buy in the forward market. There is a huge potential for the refurbished catego-

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ry smartphones as budget constraint is the biggest hurdle for many aspirational buyers in India. The refurbished market has multiple benefits for the smartphone industry. Many e-commerce companies have started offering “Buy-back” policies, which assures to buy the smartphones at the specified price after a fixed period. The phones once returned by the customers are processed in the refurbishment centres and listed on the website. In addition to generating revenues, it offers assurance to the buyers and encourages him to change phones often. Such marketing techniques employed by the e-commerce companies will propel the smartphone industry in the forward direction. The smartphone industry is growing at an exponential rate in India since 2011. As the durability of the smartphones increase, and incremental innovations decrease, the growth rate of smartphone sales might get affected shortly. To ensure a steady growth rate, marketers come up with new policies such as “Buy-Back” to compel customers to opt for the latest models. Of late, marketing has played an important role in persisting the growth rates of smartphone sales. Introducing refurbished category in the Indian e-commerce platforms is one such marketing strategy used by the marketers to put the returned goods in the online marketplace to the best possible use and further propel the sales of smartphones.


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THE

ARQUING OMENTS

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MARQUE - THE MARKETING CLUB INDIAN INSTITUTE OF MANAGEMENT ROHTAK

marketingclub@iimrohtak.ac.in DISCLAIMER: The views and opinions expressed in this magazine are those of the author and do not necessarily reflect the opinion of the stake holders of IIM Rohtak EDITOR : Isha Garg DESIGN : Sriesh C R FOLLOW US ON :

Marque- The Marketing Club, IIM Rohtak, June  
Marque- The Marketing Club, IIM Rohtak, June  
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