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JUNE ’11

Vol. III

Issue I


Ed Speak When my fist clenches, crack it open

Team

Before I use it and lose my cool When I smile, tell me some bad news Before I laugh and act like a fool - The Who

Neelotpal Shukla

When we come to the end of one year of our ever so hyped MBA, there is that sudden surge of 'knowledge

Nishchai Nevrekar

acknowledgement' that our brain generates waves of. All of a sudden on the first day of the last year of

Gaurav Modi

MBA, we feel we have somehow managed to grasp and maneuver our way through those coils and coils

Rachita Behl

of matrices and curves and chains the fathers and grandfathers of Marketing have plotted years earlier.

Kushal Mehta

And if it does not happen on the aforementioned day, it definitely kicks in when we first see 'fresh' fruit.

Krishnakant Jonnalgadda Tushar Kumar

Somehow, it does happen. Somehow it should not. When we embarked on the expedition of starting work on this issue, before any of the above

Nandini Kapur

unfortunate (un)realizations occurred, we were glad to get a kick, though of a different kind. We realized

Pawas Soni

that the matrices and curves and all of those creeping things on paper mean just that much less,

Naresh Chandak

more so as each decade passes. So we thought it best to simply see what the future might just hold,

Neha Talwar

with a passing glance in the rear view mirror. Whether it be trying to untangle the millions (zillions you say?

Puneet Aggarwal

Maybe. The count never seems to end) of nerves in the head and figure out just what goes on there, or trying to figure out why would someone chop off toes to wear those Jimmy Choos, or how the fundamental definition of food is taking a blurred form, we tried to

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Contents Trendz The power of Co-Creation

4

MICA

Blurring Food Categories

8

NMiMS, Mumbai

Marketing to the High Net Worth Customer

12

NMiMS, Mumbai

Cover Story Its all in the Mind

18

Première Namaste StarBucks

22

GIM

Gyaan Social Marketing

26

IRMA

Crowd Sourcing

30

NM Dalmia

Feature Euphoria & NjM Week

34

unlock that whimsical romance of nerve and nerves, and just extend our period of learning, albeit beyond classes this time. We wish you just tag along. The year is just getting started !

The Eds Kushal Mehta Krishnakant Jonnalgadda Designed by Nishchai Nevrekar

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TRENDZ

The Power of Co-Creation

Author

Not long back, there was a time when there existed only a few brands in each product category, thus giving the consumer limited options to purchase from. In just a decade, a time has come when there exists innumerable brands in almost every product category, and the consumer is in absolute quandary

Sharad Gaur

regarding how to make the best selection from

Is a First year Post-Graduate Management student at Mudra Institute of Communications Ahmedabad (MICA), pursuing Post Graduate

Diploma

in

Communications Management. He belongs to Jaipur and has done his graduation from the Institute of Te c h n o l o g y, B a n a r a s H i n d u University. After working in the software industry for 2 years he joined MICA to specialize in branding. His interests include outdoor sports, photography and trying out new cuisines.

among an ocean of choices. Not just that, the world has seen a boom in the media industry in terms of its reach to the audience, giving the marketers a long awaited means of promotion that is cheap, effective and covers a majority of the target audience. Thus the industry saw a sharp rise in the advertising spends of majority of the organizations and the audience was bombarded with advertisements from all sides; be the through the television, the radio, the newspaper, magazines or out-of-home media. This has further confused the already confused audience. Thus, in order to break the clutter of advertisements, the marketing strategy of organizations has seen a complete metamorphosis in the past few years, and one of the most effective of them all is customer engagement via co-creation. Customer co-creation (a term coined by Venkat Ramaswamy and C.K. Prahalad) is a concept of customer engagement in which the brand and the customer work together for creation of value by the brand for the customer (Gouillart, The Power of Co-

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Creation). In co-creation, a brand asks its customers as to what they want from the brand, and then makes them

increased their brand recognition, customer loyalty and word of mouth publicity. Another classic example of co-

partners in creating the

creation is that of Starbucks

same. In most cases, co-

coffee. Starbucks launched a

creation is a win-win

forum called 'My Starbucks

situation for the brand and

Idea' which is an online

the customers because the

community of the Starbucks

customers help the brand know precisely what they want, and in this

customers. The reason of the launch of this platform is to enable

process the brand creates something they can

them to know their customers well and to

be sure about.

understand their psyche. The customers give

“In order to break the clutter of advertisements, the marketing strategy of organizations has seen a complete metamorphosis in the past few years, and one of the most effective of them all is customer engagement via Co-Creation� A classic example of customer engagement

their idea on a range of topics like - how the

through co-creation is that of Lays from Frito

waiters should be dressed?, should they wear

lay. Lays came out with an idea on

nameplates?, making ice cubes out

customer engagement called

of coffee, kind of food served,

'Give Us Your Dillicious Flavour'.

varieties of coffee served, the

In this case, Lays came out with

interior of the cafes, etc. Then

a contest in which consumers

these ideas are voted upon by

had to suggest new flavours for

other customers and the best

lays. Lays would then select four

ideas are rewarded. Not just this,

best flavours and launch them in the

these ideas are even implemented

Indian market. As one might predict, the

in the Starbucks cafes. This way the

campaign cum contest was a huge success. It

management comes to know for sure that what

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TRENDZ kind of a change the customers want.

farmers could get the best deal for their produce,

!ITC e-choupal is perhaps the most

while ITC could get the best quality ram material

successful Indian examples of co-creation.

for further processing and sales. The concept of

'e-choupals' are internet kiosks in rural areas

e-choupals was so successful that today ITC has

within walking distance of many villages.

more than 6500 e-choupals and nearly 150

Each kiosk provided information in local

hubs, which serves almost 40,000 villages and

dialect on daily weather forecast, crop prices,

four million farmers across 10 Indian states

advice on farming methods; email service

(Gouillart, Building the Co-Creative Enterprise,

that let farmers interact with scientists at

2010).

agricultural universities, technical people at ITC, fellow farmers; access to land records,

From the above discussion, we see the power of

“Customer engagement and customer co-creation are the need of the hour in order to establish credibility and trust in the market as well as be profitable on a long run�

health and educational services and

co-creation if implemented properly. It becomes

i n fo r m a t i o n f ro m N G O s o n l a te s t

a very valuable proposition for the brand as well

developments in cattle breeding and crop

as the consumers. It saves a brand a lot of

seeds. Each kiosk was managed by a fellow

resources which the brand must have otherwise

head farmer called 'snachalak' who publicly

spent in finding out what the customer needs. At

swore allegiance to them. These kiosks were

the same time, it benefits the consumers as they

further connected by hubs called choupal

get the desired product from their cherished

saagars. Each choupal saagar connects

brand. Not just this, customer engagement

about 40-50 e-choupals. In contrast to

serves a bigger purpose.

mandis, they employ electronic weighing machines, conduct objective quality testing and pay farmers in full on the spot. Thus

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A few of the benefits are mentioned below: !

Satisfied customers results in customer retention.

!

Word of mouth publicity for the brand.

!

Acquisition of more customers due to awareness and WOM publicity.

!

Better products in the market for the consumers.

!

More competition in the market, hence better service and product quality.

!

Check on any bad word of mouth.

!

Direct contact with the consumer for suggestions and grievance solutions.

Thus, we can say that customer engagement and customer co-creation are the need of the hour if marketers have to be successful in successfully delivering value for the customers in order to establish credibility and trust in the market as well as be profitable on a long run.

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TRENDZ Author

Blurring Food Categories Multiple positioning across segments

Prasad Madhusudan Is a 1st Year MBA student at NMIMS, Mumbai. He has worked for Deloitte in the IT sector. His interests are music, singing & painting. He is planning to take up Marketing as his Majors.

Call it the two-in-one phenomenon; brands are blurring food category boundaries by positioning their products to be relevant in multiple categories. Companies are using innovations, packaging changes and cross-category placements to extend the same product to different categories. Brands are not trying to take on the well-entrenched category leaders directly but are instead broadening the domain within which their brand plays. Changing lifestyles and increased overseas travel has introduced new flavors and textures into the Indian palate. And brand extensions are catering to this need. Everyone is trying to solve the dichotomy of taste and health today.

Biscuit OR Chocolate ? NestlĂŠ and Lindt are among the top confectionery players who have blurred the distinction between chocolate and biscuits by launching biscuit products of their own. NestlĂŠ has recently sought to expand its Smarties brand and gave it a boost by launching Smarties cookies. Ferrero also launched its first nonchocolate-based snack under the Kinder brand in the

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Europe, and fruit bars in the UK and the US. Even though snack bars are increasingly covered in sugar and chocolate in order to make them tastier, the inclusion of wheat flakes, nuts and other cereal ingredients contributes to their healthier image. Conversely, bar the specialist slimming or sports products, these bars are no Ferrero’s non chocolate based snack

longer viewed as too "saintly" to be enjoyed as a snack. Such cross-category marketing is largely

form of Kinder Happy Hippo long back in 2002. This is made up of a hippo-shaped wafer shell which is filled with hazelnut and

possible at modern retail outlets where consumers have direct access to the category bays.

“Brands are not trying to take on the wellentrenched category leaders directly but are instead broadening the domain within which their brand plays” milk cream. Snack Bar OR Chocolate? Snack bars typically compete with chocolate bars by positioning themselves as a tasty but healthy alternative. This is the case across all sectors including granola bars, which focus on health and naturalness; energy bars, which focus on functionality; and breakfast bars, which play on the link with breakfast cereals. This is also the case with other snack bars, including sesame seed bars in Eastern Britannia’s Choco Decker

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TRENDZ Britannia The biscuit maker introduced Treat Choco Decker, a value-added biscuit that enrobes its Treat jam biscuit with a layer of chocolate, last year. Choco Decker now has a twin presence in the biscuit rack and the confectionery counter. This helps Britannia expand its consumer group. Britannia also has baked wheat snack in its

Knorr’s Soupy Noodles

portfolio which is focused on the youth. With

Knorr

packaging and placement similar to chips,

Consumer goods giant HUL too launched Knorr

“Britannia plays into the blur yet it is not keen on limiting itself by branding as chips. It wants to leverage its core competency of baking which is considered healthier” Britannia plays into the blur yet it is not keen

Soupy Noodles lin February 2010. Knorr's

on limiting itself by branding as chips. It

advertising has positioned the product as a

wants to leverage its core competency of

hybrid 7 pm snack combining both, the value of

baking which is considered healthier

Kelloggs Kellogg India too has leaped into the snack box from the breakfast bowl. From a category targeted largely at mothers earlier, Kellogg shrunk its pack sizes to tap into the evening snack opportunity for children by placing 10 packs alongside chips in supermarkets

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soup with a product loved by children. Its strategy

Chyawanprash cookies

is to leverage market leadership in soup to break

Take the case of Unibic, which wants you has

into the Nestle Maggi-dominated instant noodles

c o m b i n e d c o o k i e w i t h c hy ava np r a s h

category. HUL was intelligent enough to target

A new offering from the Indian arm of Australian

both the soup and noodle segment by just a

cookie maker Unibic will club the health benefits

minor innovation. In soupy noodles, Knorr soupy

of chyawanprash within the reassuring mould of

noodles is a combination of noodles with the

cookie dough. The brand wants to straddle both

soup masala. Thus without actually producing

categories. While Unibic still competes with

any new ingredient it has managed to target both

other cookie makers, the innovation could put it

the soup and noodles segment.

under the radar of chyawanprash makers such as Dabur and Emami.

Mc Donalds McDonalds' Deluxe Wrap is a snack as well as a meal. Snacking has been on the rise for the past decade or so and McDonald’s Wraps

“affordability” is one of the driving forces creating hyper

Appy Fizz This drink by ParleAgro consists carbonated

growth in the category. Affordability is not a new

apple juice. This was a sequel product of Appy

term, but it is a new factor that food retailers and

which was clean apple juice. The drink was the

foodservice operators are grappling with today.

subject of a successful campaign of advertising

A combination of snack food items are packaged

at cricket matches in 2007-08. With its

in a combination and presented as a meal.

champagne shaped bottle and smar t

United they are a meal and divided they are

advertising, Parle has succeeded in creating a

snacks.

Fizz in the segment, which is basically the Indian

Going by the current trends target in multiple

Youth. Appy Fizz plays both in the Carbonated

segments with the same product is going to be

drink as well as the fruit based nectar drink

come a norm but it is a plus point for the

segment. Actually it also competes with the

consumers since they would experience the

mocktails due to its champagne like packaging.

benefits of 2 products in one.

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TRENDZ Authors

Zehra Ladiwala

Marketing to the High Net Worth Customer: Trends and Future The High net-worth customer

Is currently pursuing her MBA at

She vacations twice a year in Europe, doesn't leave

NMiMS, Mumbai.A Computer

home without her precious LV, swears by her pair of

Science Engineer by profession and

Jimmy Choos, has countless designer outfits ranging

a shopoholic by choice. The world of

from the likes of Gucci to D&G and rides in a fancy

luxury brands has always fascinated

chauffeur driven BMW. Who is she? She is the young

her and this is what made writing this

hip Indian woman born to a life of luxury. She is a

article a very enjoyable experience

member of the crème de la crème sitting pretty at the

for her.

top end of the wealth spectrum where being filthy rich is beautiful. For her, luxury is an essential form of self indulgence. It is this customer that luxury brands like Cartier, Rolex, LV, DKNY, Chanel and many more are trying to woo.

Luxury goods Luxury goods are perceived as rewards for achievements and as a means to showcase these achievements to others. They are not governed by the

Shreyans Born, brought up and touched 6 ft, all in Mumbai! Electronics Engineer from Mumbai University. Worked at Infosys. Never managed anything higher than a ‘C’ in a Marketing, that’s what inspired him to write an article for BUZZ! ;)

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utility they serve. It is the aura of exclusivity that they possess which is reflected in the persona of the owner and makes them extremely desirable. According to a study by American Express, 'Inside the Affluent Space', the mindset of the Indian luxury consumer is a desire to prove that “I've Made It”. These set of elite individuals are price insensitive and look for exclusivity above all else. They regard luxury


“The third annual Asia-Pacific Wealth Report published by Merrill Lynch Wealth Management and Capgemini had estimated that there were 123,000 millionaires (in dollars) in India at the end of 2007, up 22.7 per cent from a year ago.� products as social status symbols and there is

Management and Capgemini had estimated

a lot of pride associated with the ownership of

that there were 123,000 millionaires (in dollars)

the high end brands. Their purpose for luxury

in India at the end of 2007, up 22.7 per cent

goods is to lavish themselves in self-

from a year ago.

indulgence.

There was a time when one had to travel abroad to buy a Gucci or an Armani. However, the

India's lust for luxe

scenario has changed over the last decade with

Being one of the fastest growing economies in

a plethora of luxury brands flocking India to be a

the Asia-Pacific region, India is expected to be

part of 'The Great Indian Growth Story'.

the next hub of luxury goods consumption.

This occurrence can be explained as a

The third annual Asia-Pacific Wealth Report

combination of push and pull. On the one hand,

p ub lished by M e r r i l l Ly n c h We a l t h

luxury retailers are spreading their wings to

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TRENDZ India because their home markets are no

cent. The market is likely to touch $14.7 bn by

longer growing as fast; push has come to

2015.

shove. On the other hand, there is every reason to believe that India will take off. The

Trends

rise in disposable income, coupled with

Louis Vuitton was the first luxury brand to have

growing brand consciousness of the urban

entered the Indian Market in Delhi in 2003. Since

elite and increased global exposure has led

then there has been no looking back with brands

to a spurt in the demand for luxury goods.

like Boss, Bvlgari, Salvatore Ferragamo, Cavali,

The luxury goods market in India is currently

Bogetta Venetta making their presence felt in

sized at $4.76 bn and is growing at a

India. Luxury brands in India admit that they tend

compounded annual growth rate of 25 per

to bring in the more expensive items in their

“A major drawback in India is the absence of high streets which elsewhere provide symbiotic clusters of posh retailers like Oxford Street in London, Fifth Avenue in New York and Avenue Montaigne in Paris.�

Luxury Mall, New Delhi

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However, there is still some ground to be covered in retailing from luxury malls. In a bid to offset the exorbitant rates that mall developers charge for renting the retail space in a luxury mall they need to attract more consumers who visit the store with the intention of buying rather than Buggati Veron - World’s fastest car

inventory knowing the high net worth Indians' penchant for exclusivity. A major drawback in India is the absence of high streets which elsewhere provide symbiotic clusters of posh retailers like Oxford Street in London, Fifth Avenue in New York and Avenue Montaigne in Paris. Thus the Luxury Brand's initial foray into the Indian market was limited to five star hotels' shopping arcades due to lack of decent luxury retail infrastructure in the country. Today, the trend of luxury retailing has now shifted towards Luxury Malls like Emporio and the year old Palladium which have become the most preferred retail destinations for international players. A luxury retail outlet in a five star hotel is a part of the overall hotel experience, whereas a luxury

those who just visit to get a feel of the brand.

Challenges With most western markets nearing saturation, the world is looking to the East and India offers enormous potential for the luxury market along with countries like China. This opportunity comes with a pinch of salt as does everything in our country. Some of the major challenges faced by luxury brands include the scattered nature of target population (high cost of reach), lack of credible real estate options, and underdeveloped back end infrastructure like warehouses, FDI regulations and high import duties. The biggest challenge however, is to find a

proper foothold in the

Indian retail space, already saturated with modestly-priced, indigenous products, which

mall as an experience is specific to shopping. Physically, in the look and feel there is hardly much difference in the stores, however the overall ambience in a luxury mall is more shopping focused. These destinations attract the right kind of potential consumers which luxury brands need for the growth of their business. Emporio houses 74 International luxury brands while Palladium has 65 high-end brands.

A Jimmy Choo Boutigue

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TRENDZ

Palladium Mall, Mumbai

“In order to succeed in India, luxury brands need to localise their marketing strategies. This goes further than just putting an Indian print on a bag or collaborating with a local celebrity.� can prove to be a Herculean task for these

Marketing to the Global Desi

premium product companies.

In order to succeed in India, luxury brands need

Also, the customer segment being targeted

to localise their marketing strategies. This goes

by international luxury brands consists of

further than just putting an Indian print on a bag

frequent international travellers who

or collaborating with a local celebrity. India

overwhelmingly prefer the experience of

houses a variety of cultures, languages, festivals

purchasing Western luxury goods abroad,

and tastes. So, it is imperative to understand the

where brands offer them wider choice, better

difference between the flamboyant nature of a

service and more competitive pricing than

Punjabi customer and the more reserved nature

what's currently available inside India. So

of a Gujarati, and speaking to each of them in the

why should they buy a Cartier here, when

specific cultural register that they respond to.

they can get it for much less on their travels?

Those brands who are willing to better

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understand and connect with the local Indian consumer will be the ones who are most successful. For example, luxury brand Montblanc — which successfully operates nineteen retail points across first, second and third tier cities in India — has regionalised all their marketing material. Brands like Louis Vuitton and Rolls Royce have also localised their approaches, identifying important events and celebrations amongst potential clients and arriving with personalised gifts or a surprise car service for the occasion. Louis Vuitton had readied a worldwide Diwalithemed splash for their stores last year; Swiss watchmaker Audemars Piguet unveiled a Rs. 2.1crore ($472,000) gift idea during Diwali. Very recently, the world's most expensive car, the Bugatti Veyron 16.4 Grand Sport, with a price tag of over Rs16 crore has debuted in India in the Diwali run-up. What these players also need to understand is that a sale cannot be the final point of their lexicon. It should be the beginning of their relationship with the consumer just as the luxury brands' affair with India has also just begun. It is an established fact that every Indian now wants to own products that inspire awe and envy. But will India's luxury malls be able to match up to the luxury malls of the world making it a coveted luxury shopping destination? Only time will tell.

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COVER STORY

From NJM’s Cradle

Kushal Mehta Is currently pursuing his MBA at NMIMS, Mumbai, with a Majors in Marketing. He has completed his B . Te c h i n E l e c t r o n i c s & Communication Engineering from STCET, Kolkata. He is a music buff and ardent football fan, and takes keen interest in reading too.

Rachita Behl Is currently pursuing her MBA in HR from NMIMS, Mumbai. She did her Engineering from VNR VJIET, Hyderabad. Her passion rests in the world of literature and she is an avid reader.

IT’S ALL IN THE MIND Neuro-marketing Inception - the idea or phenomenon of getting into an individual's brain via his dreams, and compelling him to do your bidding. Infiltrate his dreams as he sleeps under the starry skies and by the time he realizes he's losing something, it's done, and he wakes up to nothingness! Know his deepest secrets or mould his thoughts so as to get around the hurdles of awakehood. But what if this very esoteric action was used by say, the sales manager of a soft drink MNC, or maybe a high-end shoe maker? What if they could penetrate our defenses, knowing the way someone's line of thought progresses in, and then manipulate all of that to make him buy their product. Illegal? Well, that's an issue which is too far off to discuss in the absurdity of the moment. But, thinking like a marketer, it's…WOW!!

Nandini Kapur Is currently pursuing MBA in

Let's bring the concept two notches down, and what we have is Neuro-marketing.

Marketing from NMiMS,Mumbai . She has done her B.Tech. in Electronics & Communications from Jaypee University of Information Technology, Solan, She enjoys making candles and is fascinated by the traditional Japanese art of paper folding - Origami..

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Wikipedia defines neuro-marketing as 'a new field of marketing that studies consumers' sensorimotor, cognitive, and affective response to marketing stimuli. Researchers use technologies such as functional magnetic resonance imaging (fMRI) to measure changes in activity in parts of the brain, electroencephalography (EEG) to measure activity in


specific regional spectra of the brain

You are not reading this sentence because of

response, and/or sensors to measure

the title or because you are interested in what is

changes in one's physiological state (heart

written on the next page, but maybe because

rate, respiratory rate, galvanic skin response)

there's something about this picture.

to learn why consumers make the decisions they do, and what part of the brain is telling

Why?

them to do it.'

Because the picture is eliciting some kind of emotional response in you, your eyes are being

The natural question though is-why neuro-

drawn to it, and you choose to read this story to

marketing? Because people rarely say what

find out what the heck it's all about.

they think when they are asked about what

And this is what this article is all about-Neuro-

they 'think' in response to a certain question.

marketing!

“What if they could penetrate our defenses, knowing the way someone's line of thought progresses in, and then manipulate all of that to make him buy their product. Illegal?� I can make you read this!

Many companies have already recognized the potential neuro-marketing offers and are using it to gain a competitive edge. A fine example of this is the American restaurant chain Five Guys. Let's discover what makes them tick and how!

Keep things simple-We help you choose Five Guys has a minimalist menu. It is totally focused on one entree, the hamburger, and one side dish, french fries. One alternate entree, a

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COVER STORY

Jerry Murrell, Five Guys Burgers and Fries

“Like everything else, it is the beginning and the ending that influence the entire experience.” hot dog, is also available. The principle of

Because others say so

neuro-marketing at work here is that

Walls screaming out loud “The burgers at Five

“customers presented with fewer choices in

Guys are awesome!” A third of their paper

a retail environment buy greater quantities of

takeout menus covered up with reviews. The

product.”

principle at work- Social Proof. A theory that

But how is the menu so simple? Lack of

suggests we base our response to a situation

variety? Nay. They give away all their toppings

based on how others react to it. By the time you

for FREE! This reduces the “paying pain” of

start munching on your food, your expectations

customers and strengthens their value

would already have been set. Even if you had

proposition.

doubts when you walked in through the door, all those burger lovers in other places cannot be wrong, right?

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Appeal to the senses

gain vs pain tradeoff are some of the ways to

These guys go beyond the taste buds. Rightly so.

achieve that.

Half of the beauty of food is in its smell. Look even

Like everything else, it is the beginning and the

beyond that. Five Guys appeals to the visual

ending that influence the entire experience.

senses too! To show that they use only fresh

However, being at its nascent stage, Neuro-

potatoes, they line up bags of the spuds where

marketing brings in quite a lot of apprehension.

the customers queue up to order. As they say a

After all, Inception is the idea or phenomenon of

picture is worth a thousand words! It drives the

getting into an individual's brain via his dreams,

point home far more effectively by going straight

and compelling him to do your bidding. So how

to our subconscious.

ethical is this entire process of reading the consumer's mind? Knowing what drives a

Whether Five Guys consulted any neuroscientist,

consumer and doing just that to make him

we can't say. But one thing's for sure. What we

choose your product over the others? We might

see here is a perfect union of marketing and

condone such an act if it is harmful. But who

neuroscience aka neuro-marketing! And clearly,

shalt be thy judge? Who shalt stop and tell thy

it works! So it would not be wrong to assume that

that thou dost wrong?

as time passes, and economic and financial pressure increases, more and more companies

We all know that the warning labels on cigarettes

will turn to neuro-marketing. Behavioral science

make smokers want to smoke more. So where is

will soon be a major part of market research.

the limit? Curiously, the seed is already sown.

After all how many times do you get a chance like this one to convert a consumer's “mmm-good” into “mmm-better”? Lessons for marketers? To strengthen your brand, appeal to the customers' reptilian or the old brain, which guides all buying decisions. It all comes down to who triggers the first reptilian action. So what does this brain respond to? Emotions that excite all the senses, and for a customer, the 4Ps are his 'senses'. Visual orientation, conveying tangible benefits, memorable beginnings and endings that influence the entire experience, minimizing the

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première Authors

Namaste Starbucks!!! Organised coffee retailing is a niche but growing segment in India which is now worth close to USD

Sarika Sinha a student of Goa institute of Management, Goa Ms. Sinha has done B.Tech in textile technology from UPTTI, Kanpur. Before joining GIM, she has worked in Supply Chain Management at Raymond ltd.She has worked as an editor of college annual journal “Fibre to Finish”.

441 million with around 1500 cafes is 150 cities. The coffee retail market is expected to grow at an annual rate of over 40%. At present, Indian sips coffee from players like Café Coffee Day, Barista, Costa Coffee, Gloria Jeans, Qwiky's, Café Nescafe and Coffee Bean.

Bang

alore based chain Café Coffee Day is currently the leader with 1,090 cafés and kiosks, and 15,000 vending machines. Barista, owned by Italy-based Lavazza, is second, followed by UK-based chain Costa Coffee. Starbucks, an international coffee

caf

é chain had recently signed a non-binding Memorandum of Understanding (MoU) with Tata Coffee Ltd for sourcing coffee and for retail business in India. Starbucks will set up its storesin luxurious 5

Chandramouli Muthiah

star hotels of Tata.

is currently pursuing MBA from Goa

In fact few more international coffee chains are

institute of Management, Goa

preparing to enter India. The UK's Coffee Republic,

Mr Muthiah has done his Bachelors

Malta's Cafe Jubilee and Australia's Coffee Club

in Arts and has worked in Marketing

Group are looking for franchise partners in India.

and Sales. He has an interest in

Dunkin donuts had already announced to open 500

cricket and has played for Karnataka

stores in the next 15 years. Recent survey says that

State cricket team.

doing business in India has become more congenial

22| Buzz - The Markazine | Jun 2011


years and penetrate tier II and tier III cities.

Exibit 1 : Coffee Consumption in India

Does the entrance of Starbucks means that the

Calendar year

Quantity in (MT)

existing players should wake up and smell the

2004 2005 2006 2007 2008

75,000 80,200 85,000 90,000 94,400

coffee?Competition is already intense among existing chains and they are trying hard to woo consumers but with the arrival of Starbucks the intensity of this competition will increase

now which is one of the major reasons that

further.

these companies can't ignore India now

Barista and CCD have a first mover's advantage

(Exhibit 3).

as they have already customized their menu for

By recognising the fast emerging “coffee and

the Indian palette.The existing coffee chains

hangout” culture in India Starbuckshad tried

have targeted the premium segment youth, as

“India is one of the most dynamic markets in the world with a diverse culture and tremendous potential” Howard Schultz, Chairman, Starbucks to enter Indian shores in the past by

they realized that it wasn't only coffee that their

collaboration with the Kishore Biyani's Future

target segment was looking for, but also for a

Group, Anil Ambani Group and Jubilant Foods

place to hang around comfortably, where they

Ltd. But none of these attempts fructified.So

could be themselves and do whatever they

Entrance of Starbucks in collaboration with

wanted, such as play games, read books, listen

Tata is not shocking news for anyone.

to music, enjoy arts, surf the Net or simply

According to industry estimates, there is

chilling out. Starbucks with its vast experience of

scope for another 5,400 outlets strategically

handling consumers from dif ferent

located close to offices, colleges and

geographical regions would certainly have a

shopping malls. Every player is already

competitive edge here. It has indicated that it is

planning to expand over the next two-three

going to position itself as an elite brand and

23| Buzz - The Markazine | Jun 2011


première intense competition it seems it would become more service-led than price-led differentiation in the future. To combat competition, “India is one of the most dynamic markets in the world with a diverseculture and tremendous potential. This MoU is the first step in our entry to India” said Howard Schultz, Exibit 2 : Age wise precentage coffee consumption

I n d i a n s fa s t g row i n g a p p et i te fo r

Chairman,Starbucks. “We welcome the entry of Starbucks into

India. It will certainly add to the excitement of the

“We welcome the entry of Starbucks into India. It will certainly add to the excitement of the culture of cafes here and we are looking forward to an expanded market going forward” Venu Madhav, COO, CCD. extravagance might work well for them.

culture of cafes here and we are looking forward

With the entry of Starbucks the existing

to an expanded market going forward,” said Venu

chains has to focus a lot on aggressive

Madhav, COO, CCD

expansion plans, innovative marketing

CCD is already looking to launch another 200

strategies and variety in products offered.

cafes to add to its presence on highways and

Coffee and conversations often lead to food

inside malls and corporate offices. Italso plans

so by offering variety of food (healthy snacks

to open no. of lounges in major citiesas well as

also)companies can dig deeper in consumer

Coffee Day Squares in major cities. These

p o c ke t . A l s o b y s e l l i n g d i f fe r e n t

lounges will target mainly young professionals

merchandises these companies gives

who grew up on CCD. Similarly, as a part of

consumer an opportunity to take home a part

differentiating its services, Barista is already

of his unforgettable experience. Due to

offering Italian food at its outlets and also

24| Buzz - The Markazine | Jun 2011


Exibit 3 : Pestel Analysis Political !

and in hotels. Indeed Starbucks entry will stimulate growth in

Stable govt has created better working

environment for industries !

High tolerance towards

to deliver the best to be the consumer's first foreign

countries and encourage foreign investments !

the coffee and hangout culture. Everyone will try

proposed changes in FDI structure in

choice. The price sensitive nature of the Indian market will be a challenge for Starbucks. Retaining performing employees for all chains

various sectors

will be another problem since the well versed

Economical

hands in this sector would love to join

!

india is no. 1 in consumer confidence

index 2010 !

Less affected by economic downturn

because of vast domestic consumption !

approx 59% population is above low

income line *

Sociocultural !

younger polulation with median age

25.9 yrs. !

Rising coffee culture and café

considered as place for socialising and hangout !

Improved living standards of people

!

Increased brand consciousness will

help Starbucks as coffee is considered as an elite beverage

Technological !

Improved quality of Indian coffee as

80% of coffee is exported !

international brands. Though none of the companies are willing to admit the tension with the entry of such a large player, all are keen to know what formats Starbucks will bring to India and what will be their strategies. Its success in the long run will however depend on how well it is able to adapt to Indian taste buds.Some coffee chains might decide to sell their stakes to Starbucks which will further strengthen its positioning in India. India is a country of equal opportunities and Indians are known for their warm welcome to MNC if company is willing to offer the products in “Indian” style.It's sure that Starbuckspresence in the country would improve the café culture in the country. Amidst all commotion coffee connoisseurs will certainly enjoy their fine cup of coffee.

Easy availability of Low cost of labour

entered into tie – ups with Planet M, Crossword and Ebony to set up Espresso Corners at these places. Also to expand its reach, the company has opened outlets in theatres, offices, airports

25| Buzz - The Markazine | Jun 2011


GYAAN Author

SOCIAL MARKETING Evolution Social marketing originated as a discipline in the 1970s, when Philip Kotler and Gerald Zaltman comprehended that the same marketing principles

Akhileshwar Kumar

which were used to sell products by different business organizations could be used to "sell" ideas,

Is currently pursuing his MBA at the Institute of Rural Management, Anand, class of 2012. He has completed his Engineering from

attitudes and behaviors. Kotler and Andreasen define social marketing as "differing from other areas of marketing only with respect to the objectives of the marketer and his or her organization�.

RGPV Bhopal. He has a keen interest in working in the development sector. Initially associated with a Bhopal based NGO, he worked on the field for two months in Samastipur district, Bihar, where he studied various themes like migration and remittance pattern in the village.

Need for change The view that marketing can be useful only for the organizations in the business domain and not for the ones that are in the areas of development is fast changing. The area of social marketing gets prominence and generates a lot of possibilities for social reformers and development agencies. Many development organizations and Ngo have adopted the best management practices of domains like finance

or

operation

or

human

resourcemanagement and have been highly successful after its implementation. But the marketing principals have not been majorly applied by these development agencies or the Ngo barring a few exceptions. The same concepts of marketing can be applied to the area of social issues. Social issues need the kind

26| Buzz - The Markazine | Jun 2011


of attention as any other product but this is

Cause related marketing and

still neglected. In the purview of the

Social Marketing

acceptance and establishment of the social

There is a remarkable difference between the

marketing the idea can be taken forward and

cause related marketing and social marketing.

used by many Non- government organizations

The Jago re campaign started by Tata tea was an

to promote their cause and the activities that

example of cause related marketing. Similar is

they are in. Social marketing when applied to

the Save Tiger campaign promoted by Aircel. The

Ngoand other such social organizations will

reason that I make these distinctions is that

help them reach out to a wider population and

these campaigns have had an impact on the

establish their credibility and also the cause

public but the motives were entirely different. If

that they are working on.

such campaigns can get the attention and have an impact there is a huge possibility that the

“Differing from other areas of marketing only with respect to the objectives of the marketer and his or her organization� Kotler and Andreasen on Social Marketing

27| Buzz - The Markazine | Jun 2011


GYAAN social campaigns can arouse the sentiments

people and cause the necessary change in the

of people and effect a behavioral change

society.

that is intended.

The development organizations and many NGO

Cause related marketing is often confused

work on shoe string budgets. The work that they

with a kind of social marketing. Though the

do never gets highlighted. Most cannot even

companies promote a social cause but the

name the biggest NGOs in the country. The lack

intention also is to gain brownie points for the

of marketing has caused the difference. With

brand from the campaign. I am not criticizing,

adopting marketing practices not only the cause

the kind of promotions just trying to highlight

that the NGO is working on will get highlighted but

the hidden interest which get neglected.

also the NGO will get better recognition. The recognition will help them generate funds and

“Cause related marketing is often confused with a

kind of social marketing. Though the companies promote a social cause but the intention also is to gain brownie points for the brand from the campaign� eventually help them in promoting the cause. Advantages

Thus marketing will go a long way in generating

Social marketing will provide the necessary

funds for such agencies working in the

tools for the organizations which intend to

development field.

bring a positive change in the society. Using

Various campaigns that have been promoted by

social marketing methods certain causes

the government agencies like polio eradication

can be better addressed. Marketing can

campaign have got adequate recognition. The

hugely influence the behavior of a person.

processes can also be implemented for many

Think about the influence it will have if issues

other causes. Using advertisements specially

like child marriage, literacy, health,

designed and other promotional methods to

infanticide and other such issues are heavily

reach the message to the people will help the

promoted. The marketing campaigns will go

cause find recognition. The recognition will effect

a long way in influencing the attitudes of

a behavioral change in the public.

28 | Buzz - The Markazine | Jun 2011


Example: Presented here is an example of how important a social marketing campaign can be in changing the society for the better. Product: Adoption Target population: Childless couples, single mothers, orphanage homes Promotion: Advertisements, educating about the process of adoption, campaigns Price: Societal benefits (earned) This kind of societal change has to be brought out in the open and need to be discussed with people who are unaware of it. The response that such issues will generate will be phenomenal. It's often argued that people act according to what they hear or see. So if a method like social marketing can help them hear and see the issues the actions will follow.

Conclusion Social marketing needs adequate attention from many agencies as the developmental organizations, donor agencies etc. It can be used as an active method to improve the visibility of the cause and also the organization which are struggling to find recognition and therefore sustainable growth. Promoting social causes by identifying the right target segment and reaching out to the people with various marketing

and

promotional tools will lead to a desired behavioral change.

29| Buzz - The Markazine | Jun 2011


GYAAN Author

CROWDSOURCING Divide and rule was the famous strategy used by Britishers to rule over Indians for decades. Today marketeers are quite inspired by the saying and are using it but with a twist divide the work and rule. Crowdsourcing: if we look at the word and break into two parts CROWD would be the general public and SOURCING would be giving out work or delegating work to others. In totality, crowdsourcing is the act of outsourcing

Nikita Agarwal

tasks, traditionally performed by an employee or contractor, to an undefined, large group of people or

Is currently pursuing her MBA from

community (a "crowd"), through an open call.

N.L.Dalmia Institute of Management

The answer to effective crowdsourcing may lie

Studies & Research. A Mumbaikar

somewhere in the middle of professional expertise

and a Commerce graduate from

and public opinion. Companies can interpret and

Sydenham College of Commerce &

create certain results and then ask the public to

Economics, she loves writing,

make a choice out of them.

blogging, dancing & listening to

SOME INTERESTING EXAMPLES AND THEIR

music.

VALUABLE INSIGHTS 路

Being a movie freak the first example that

crosses my mind is that of the youth favorite JAB WE MET. The makers of the movie crowdsourced the task of giving an enticing name to the flick and conducted popular voting. Three options were given: 1.

Ishq Via Bhatinda

2.

Jab We Met

3.

Punjab Mail

The three alternatives reduced the effort needed to enter the contest & the participants just had to send an SMS. The catchy and contemporary Hinglish (a mix of English and Hindi words) acted as an unshown

30| Buzz - The Markazine | Jun 2011


“Crowdsourcing is the act of outsourcing tasks, traditionally performed by an employee or contractor, to an undefined, large group of people or community (a "crowd"), through an open call.” trailer depicting the kind of movie Jab We Met

that are more compatible with local culture.

was: A mix of traditional and modern, witty and

Insight: The concept of crowdsourcing has an

young. This promotional crowdsourcing

inherent advantage that “what is created by

campaign created much needed buzz before

people would enjoy greater acceptability by

the release of the movie.

them.”

Insight: A flavor of the actual ice cream can be

·

given subtly through crowdsourcing.

marketing campaign in early 2007 which

·

The most “in” thing of today's times

allowed consumers to design the look of a Pepsi

Facebook has used crowdsourcing since

can. The winners would receive a $10,000 prize,

2008 to create different language versions of

and their artwork would be featured on 500

its site. The company claims this method

million Pepsi cans around the United States.

offers the advantage of providing site versions

Insight: Crowdsourcing brings about customer

The most loved cola, Pepsi, launched a

31| Buzz - The Markazine | Jun 2011


GYAAN involvement towards the brand which in turn

indicator of the kind of magic tricks that are in the

shoots up brand loyalty.

pocket of a marketeer through the tool of

Procter & Gamble :

crowdsourcing.

They used crowdsourcing with their research-

With growing competition marketeers need to

based product development, reaching out to

pilot new ideas for gaining the attention of the

s c i e n t i s t s o u t s i d e t h e i r ow n R & D

commoner. Crowdsourcing is one such tool which

departments.

eases the task of the crowdsourcing party and

Insight: Crowdsourcing can be useful not just

gives an invitation to the interested people to

with simple, repetitive tasks but also with

reflect their infatuation towards the brand,

complex research and development.

product, concept, idea etc through getting

The above mentioned few examples are just

involved.

“A very essential thing is to gauge beforehand what exactly could make the people targeted get up and get going to be a part of the Crowdsourcing�

32| Buzz - The Markazine | Jun 2011


Like every other thing, even a seemingly perfect tool called crowdsourcing has a tint of grey side to it. The company should undertake the act of crowdsourcing considering all the minute nuances of the activity. Sometimes the initiative could fall flat because of lack of interest creation in the minds of those targeted. Here, a very essential thing is to gauge beforehand what exactly could make the people targeted get up and get going to be a part of the crowdsourcing. As the monetary aspect is less attractive in this case, the people should be touched emotionally. Marketeers are, now, bringing up new ideas in relation to this concept to attract and engage customers. They get a firsthand insight of what exactly customers desire, which can help in taking strategic decisions. The people involved may feel a brand-building kinship with the crowdsourcing organization, which is the result of an earned sense of ownership through contribution and collaboration. When the work is outsourced to a particular group of employees the ideas generated may be confined to a few brains, whereas crowdsourcing leads to a pooling of ideas of people of varied demographics, thereby increasing the chances of a EUREKA!!!

33| Buzz - The Markazine | Jun 2011


FEATURE

N J M ‘ Broadway's dark tonight,

And where we create the 'BuZZ' around our

A little bit weaker than it used to be,

'Conquest's, grill the “Last Marketeer Standing'

See the young man sitting in the old man's bar,

till he wishes he wasn't 'the One', and celebrate

Waiting for his turn to die’

and honour the Kotlers' and Druckers' and Lewitts' existences for an entire week, for we

Broadway was indeed darker than it used to

believe no matter how high the bark grows and

be. With the usual dreary schedule following

how much the branches outgrow each other in

another and the old man's bar serving up the

their race for their time under the sun, the roots

same concoctions, the road back to glamour

always hold sway.

and supremacy was indeed a bit tougher than the usual uphill endeavors. That little enigma,

And in case you gain any misconception about

that little wave of the wand, that little jig that

the work we do, well the name should bring you

brings the entire panorama out of obscurity

back to harsh reality, because at Not-Just-

and flushes shades of symbolic fervor into

Marketing, the task just begins at the 'M' word.

hearts was missing. That's when we at NJM

What follows next is stretching the entire gamut

stood up and said…

to an extent where the scope overhauls the enlisted objectives and after hours and hours of

“Blahhhhh…let the Marketeers

rule

mayhem!!”

finalizing and executing and re-executing the 'final step's, we suddenly realize, we there is another that follows. And what's worse is that no

NJM, where ideas are created and chucked

matter what we do, the bloody bug to better

away with scarily equal dismissiveness, and

ourselves just doesn't die!

where we do not care, because we know the next one will be ruling the roster in half the

Well..that was us..and yeah..have to cut it short

time. Welcome to NJM, where we decide how

here. The damn bug bit again. Darn!

to change the aeons old marketing concepts and are hell bent on bending the bends to create new bends only to bend them the next time we have those just-off-the-work 'shots'.

34 | Buzz - The Markazine | Jun 2011


The junior committee rose to the occasion and made it a roaring success. For the first time, the Conquest Corporate Project was being offered to The world doesn't become a great place to live

the batch as the prize. With Bollywood being the

in because of preservers. It is the expanders

under-current as the theme, this intra college

who do not restrict themselves to the defined

event included some really fun activities like Flop

horizons and come up with something new. For

Movie Marketing, preparing wacky CV for actors for

them- to define is to limit. NJM, keeping up to its

the most amusing parts [Fancy Bobby darling

legacy, came up with the new addition to it's

playing the role of Shankar Nagre in Sarkar]. If just

already action packed calendar, in the form of

the sound of it is leaving you in splits, imagine the

NJM Week. For a debut event, it met with an

madness to witness it sitting right there. That's the

overwhelming response.

level of madness we are talking about.

tried to go hand in hand.

Guerrilla Warzone

us to choose the final cut of participants who

When everyone decided to have some fun, we

entered the zone of battle and aggression-

thought why not start a war? There was

Guerrilla Zone.

Guerrilla Warzone was an intra college event starting with the online round of STP which helped

intensity, aggression, powerhouse action, the

“Evil met the Alter Ego�- there was a flurry of

usual ingredient of wholesome entertainment

ambush. With subsequent round testing 6 different

and whopping prizes worth Rs 1 Lakh up for

facets of marketing of participants incorporated

grabs.

into a game and the final round being a Pricing

Sang Real was kept as an inter college online

Game

event where the participants revisited their

It's time to be part of the action and play the

marketing concepts There were the most

protagonist rather than being the audience. Cheers

unusual mishaps when speed and accuracy

to another exciting year ahead.

35| Buzz - The Markazine | Jun 2011


Opinion Wall

Co-creation is the practice of developing systems, products, or services through the collaborative execution of developers and stakeholders, companies and customers, or managers and employees. The “ivory tower� seems to have opened with Co-creation sparking innovation, cutting costs, increasing employee engagement, and generating value. Large organizations including Nike, Nokia and IBM are testimony to the same. In fact if experts are advising companies to move to the third stage of co-creation that seeks continuous and sustainable improvement across systems and processes. The verdict is thus loud and clear. Co-Create and move forward.

atwale H a y n Lava NMIMS The current scenario of cut throat competition to gain market share has put the Customer in the backseat. Co-creation is the order of the day and companies need to provide a 'platform' with the right knowledge, skills and resources on which customers can co-create value. This provides the customers with a superior experience that improves their satisfaction, loyalty and ultimately strengthening the bottom-line for the company.

Ashwin

P Anand NMIMS

36| Buzz - The Markazine | Jun 2011


Team

Contact Details : Neelotpal Shukla - 9619339510 Nishchai Nevrekar - 9004669367 Gaurav Modi - 9619193091 Rachita Behl - 9702467969 Kushal Mehta - 7738220886 Krishnakant Jonnalgadda - 9975043898 Tushar Kumar - 9768557929 Nandini Kapur - 9619484969 Pawas Soni - 9619594064 Naresh Chandak - 9619473047 Puneet Aggarwal - 7666947322 Neha Talwar - 9619270546

Contact: njm@nmims.org Follow us on :

37| Buzz - The Markazine | Jun 2011


Contact: njm@nmims.org Follow us on :

Buzz - The Markazine : September 2011  

The marketing magazine by NJM, NMIMS