Wednesday, December 29, 2010

Gems & Jewellery Market in India



Gems and jewellery form an integral part of Indian tradition. A legacy passed from one generation to another. The components of jewellery include not only traditional gold but also diamond, platinum accompanied by a variety of precious and semi-precious stones.

The Indian gems and jewellery market is set to cross US$ 26 billion by 2012, on the back of improving lifestyle and availability of skilled labour, as per a report ‘Indian Gems and Jewellery Market – Future Prospects to 2011’, by RNCOS.

India, the largest consumer and importer of gold in the world, is projected to import around 500-550 tonnes of gold in 2010, as per AnjaniSinha, head of the Indian Bullion Market Association (IBMA).

As per the credit rating agency Crisil, the diamond industry in India is predicted to remain stable during 2010-11 due to improved prices and steady demand.

The Gem and Jewellery Export Promotion Council (GJEPC) predicts that the gems and jewellery exports would witness a rise of around 5 per cent year-on-year during FY11.

Industry Structure

Although, the market is highly dominated by the unorganised players, with increase in consumer income and economic prosperity, the future of organised retail in India is very bright. The braded jewellery sector is estimated to reach US$ 2.2 billion by 2010 on the back of quality consciousness among target consumers, as per a McKinsey report.

The Gem and Jewellery Export Promotion Council's (GJEPC) performance figures for the financial year 2009-10 showcased the true resilience of the Indian industry over the last year whence it continued with its consistent plans of building trading relations and penetrating newer markets.

In its bid to enhance the market strategy, a gems and jewellery special economic zone (SEZ) sprawling over 40 acres with an investment of US$ 441.1 million is being planned to be set up by Gold Souk, the jewellery mall developer. The company plans to have residential apartments named Gold Souk City, apart from having gems and jewellery manufacturers from Thailand and Dubai who will open their units in India.

Total net imports of gems and jewellery in April 2009- June 2010, touched US$ 81.08 billion (provisional figures) as compared to US$ 56.43 billion posed in the corresponding period in the previous year, according to GJEPC.

Gold

India is one of the largest bullion markets in the world. It has been until now, the undisputed single-largest Gold bullion consumer.

Gold imports stood at 739 tonnes during April 2009-March 2010. According to SanjivBatra, Chairman and Managing Director, MMTC Ltd - the country's top gold importer, stated that the company is likely to import 200 tonnes of the precious metal in the current fiscal year.

The net imports of gold bars during April-June 2010 was estimated at US$ 11.36 billion (provisional), ascompared to US$ 16.66 billion the first quarter of last fiscal.

In the world official gold holdings ratings, India stood at 11th position with 557.7 tonnes of gold reserve as of June 2010, as per the World Gold Council.

India is the largest consumer of gold jewellery in the world, accounting for about 20 per cent of global gold consumption.

According to a release by the World Gold Council, during the first quarter of 2010 (Jan-Mar) India was ranked as the strongest performing market on the back of increase in consumer demand. The country registered an increase of 698 per cent to 193.5 tonnes.

Diamond

India is the world's largest diamond cutting and polishing centre in the world.

Surat is India's diamond processing hub, contributing over 80 per cent of the country's diamond processing industry with annual revenue of around US$ 13.03 billion.

India is the world's largest diamond cutting and polishing centre in the world. It accounts for 60 per cent value share, 82 per cent by carats and 95 per cent share of the world market by number of pieces.It is the third largest consumer of polished diamonds after the US and Japan.


Platinum

Due to the increasing gold prices, platinum jewellery has gained momentum in the past few years not only worldwide but also in India. As per the Platinum Guild International (India), the number of outlets selling platinum jewellery increased from 12 in 2000-01 to over 300 currently. It is predicted that the number of outlets selling platinum jewellery would increase to around 1,000 outlets in the next 2-3 years. Most platinum jewellery manufacturers are targettingconsumers in the age group 20-40 years with high disposable income.

Costume Jewellery

The Indian costume jewellery market is also witnessing growth in the international market, as per the Export Promotion Council for Handicrafts. The industry body further stated that the Government is also working towards formulating an international compliance code for manufacturing costume jewellery.

The currentglobal costume jewellery and accessories market is estimated at US$ 16.3 billion, of which India only exports around US$ 53 million, thereby, providing a huge opportunity area for the Indian costume manufacturers.

Exports

Exports rose to US$ 8.89 billion during April-June 2010 from US$ 5.3 billion in the corresponding period last year, registering 67.6 per cent growth in the total gem and jewellery exports, as per data released by the Gem and Jewellery Export Promotion Council (GJEPC).

The figures for export of gold jewelleryin June 2010stood at US$ 610.40 million representing a growth of 39.6per cent as compared to US$ 437.24 million in June 2009.

The export of coloured gemstones stood at US$ 60.88 million reflecting a growth of 5.22 per cent in April-June 2010 as compared to US$ 57.86 million during the same period last year. During June 2010, US$ 23.94 million worth of coloured gemstones were exported.

The rough diamond exports stood at US$ 247.94 million whereas the cut and polished diamond exports posted a growth of 85.37 per cent with US$ 5.9 billion worth of exportsduring the first quarter of 2010-11. In June 2010 itself, cut and polished diamond exports stood at US$ 2.2 billion.

Government Initiatives

In order to open a new avenue for the bullion trader community with improved trading practices and increased delivery centres, the recent strategic tie-up between Bombay Bullion Association (BBA) and Indian Commodity Exchange Ltd (ICEX) has opened an avenue to harness the huge investment potential lying with the small and the unorganised players. It further offers membership to all the BBA members. It further, jointly deepens the markets in order to encourage wider participation, by providing multiple delivery centres across the country by leveraging on MMTC's and BBA's pan-India network. BBA will be an important stake holder in exchange's efforts in strengthening the delivery infrastructure and also in launching customised contracts suited to requirements of Indian markets.

In a move to boost the industry, the government has formulated new rules for faster clearance of import and export consignments of specific goods including jewellery and gems.

Furthermore, the government has incorporated some other measures like providing interest subvention of 2 per cent to labour intensive export sectors and duty drawback facilities, in order to promote gems and jewellery export.

The Road Ahead

The country-specific trade centre of India, the India Trade and Exhibition Centre (ITEC), will start functioning in Sharjah from October 2010. ITEC will be a one-stop-shop for Indian businessmen and small and medium enterprises (SMEs), which will assist them to explore potential markets and opportunities in the UAE, Gulf Cooperation Council (GCC) nations, the Middle East and North African region. ITEC will organise exhibitions every month till June next year with focus on gems and jewellery being showcased in April 2011. The exhibitors who will showcase their products in these exhibitions will be organised through the export promotion council.

The Gems and Jewellery Export Promotion Council has initiated IIJS Signature to promote India as the preferred source for jewellery and eventually build Brand India. Signature was conceptualised to showcase India's ability to produce quality jewellery that will match the lifestyle trends world over.

GJEPC hosted IIJS Mumbai 2010 considered to be the largest jewellery show in Asiain August, 2010 to highlight India's capabilities to manufacture jewellery in terms of design, craftsmanship and quality at par with international centres and also to foster relations with other markets around the world.

Friday, December 10, 2010

Case Study of Bisleri



Details

Themes: Marketing Mix
Period : 2001-2002
Organization : Parle Bisleri Ltd, Coca Cola, Pepsi
Countries : India
Industry : Branded Water


Reinventing Bisleri: Introduction
In the early 1990s, Parle Bisleri Ltd's (Parle Bisleri's) Bisleri1 had become synonymous with branded water and had a market share of 70%. In the late 1990s, Bisleri's market share began to erode with new players entering the market. The new players also positioned their products on the purity platform and Bisleri felt the need to differentiate itself from the crowd. In the late 1990s, Bisleri launched its Pure and Safe ad campaign to convince the consumers that it was the only pure and safe branded water in the market. However, in 2000-01, Bisleri faced another challenge.

The Cola majors, Pepsi and Coca-Cola and the confectionery giant, Nestle, also entered the branded water market in India. Pepsi and Coca-Cola had an established distribution network. Bisleri realized that with the new players also clambering on to the purity plank, it had to reposition itself to arrest its declining market share. In September 2000, Parle Bisleri launched its Play Safe ad campaign. The company tried to add a fun element to Bisleri to rejuvenate the brand. The ultimate aim was to increase Bisleri's turnover from Rs 4 billion2 in 2000 to Rs 10 billion by 2003.



Bisleri Feels The Heat
In the early 1990s, the branded mineral water industry was worth Rs 3 billion, producing around 95 million litres in 1992. Parle Bisleri's Bisleri brand launched in 1971, was the leader with 70% market share. After 1993, the branded mineral water industry saw some hectic activity. On an average, every three months, a new brand was launched and another died.

In the late 1990s, many international brands were planning to enter the branded mineral water market. According to some analysts, the main reason for the boom in branded water was the fact that people were becoming more health and hygiene conscious. Branded mineral water which sold in only 60 towns in 1993, was available in 250 towns in 1997. In 1998, Bisleri's market share came down to 60%, while Parle Agro's3 Bailley had 20%. The remaining 20% was shared by regional players.

In 1998, the branded mineral water market had grown to a 424 million litre business, valued at Rs 4 billion. There were 200 brands available in the country. In their bid to garner greater market share, many companies, including Parle Bisleri tried to make quality and the purification processes they used their unique selling proposition (USP).

In 2000, the branded water market had grown to Rs 7 billion. New players like Pepsi's Aquafina, Coca-Cola's Kinley and Nestle's Pure Life entered the market. The market was segmented into premium, popular and bulk segments (Refer Table I for the price range in different segments).

The premium segment was the least crowded with just four brands: French transnational-Danone's Evian and Ferrarelle and Nestle's Perrier and San Pellagrino. The popular segment was where most of the action was.

Bisleri, Bailley, Aquafina, and Kinley were some of the dominant brands in this segment. In the bulk segment (5, 12 & 20 litres), Bisleri was a major player with Kinley and Aquafina staying out of this segment.

As product differentiation on the basis of quality became increasingly difficult, with each company claiming that its brand was safe and pure, companies began to use packaging to differentiate their products. Bisleri introduced a tamper proof seal in the 500 ml bottle.


However, analysts felt that Bisleri's efforts to reinforce its pure and safe image with a tamper proof seal may not be all that effective as competitors also had similar tamper proof sealed bottles. They felt that it was companies with strong distribution channels that would do well in the long run. Pepsi's Aquafina was strongly placed because it had the backing of Pepsi's distribution network in the country.

In August 2000, Coca-Cola India launched its bottled water brand, Kinley. Some analysts said that it would be difficult for Kinley to make a dent in the branded water market in India because it was already overcrowded and highly competitive. Commenting on Kinley's launch, Ramesh Chauhan (Chauhan), CEO of Parle Bisleri Ltd said, "It will be tough for anyone to beat us in this game. We will remain market leaders."

By 2001, the mineral water market was worth Rs 10 billion and was growing at the rate of 40% a year. Kinley and Aquafina made inroads into the market and by March 2001, Kinley had a 10% market share, Aquafina had 4% and the share of Bisleri had come down to 51%. By June 2001, Bisleri's market share was 47% and Aquafina and Kinley together accounted for over a third of the market (Refer Table II).

In 2001, both Kinley and Aquafina were making huge investments in bottling plants and distribution. By 2002, Coca-Cola India planned to double the number of water bottling plants to 16 and Pepsi announced that it would add seven more plants to the existing five. In contrast, Bisleri had only 15 bottling plants and three franchisees. Kinley had 500,000 outlets compared to Bisleri's 350,000. Analysts felt that Kinley and Aquafina had an edge over Bisleri because of their strong distribution network.

However, one area in which Bisleri seemed to have an advantage over Kinley and Aquafina was the bulk segment. In 2000 Bisleri's 5 and 20 litres packs accounted for 20% of its sales. In 2001, the company planned to have 75% of its sales from bulk packs of 5 and 20 litres. According to analysts the bulk segment had vast potential, and was expected to grow fast. In 2000, 40% of the branded water consumption was in eateries, homes and restaurants.

Large shops and commercial complexes were fast emerging as attractive targets for mineral water marketers and Bisleri wanted to be the first to establish itself in the bulk pack segment.

Bisleri reportedly wanted to focus on the bulk segment because Pepsi and Coca-Cola seemed to be strong in the retail segment and would take some time to strengthen their presence in the bulk segment.

Said Vibha Paul Rishi, executive director (marketing), of Pepsi, "The bulk segment is not our core strength, so we would like to confine Aquafina to the retail segment for the time being."5 To strengthen its presence in the bulk segment, Bisleri was investing heavily on marketing and distribution.

According to some analysts the competition between Pepsi and Coca-Cola in India would shift to branded mineral water. With the cola market having remained stagnant for the past few years, the branded water market, with 40% growth would be an attractive option for these companies.



Coca-Cola planned to invest Rs 700-750 million in its water business by 2005 and Pepsi around Rs 800 million to Rs 1 billion. In 2001, Kinley contributed 5% to Coca-Cola's revenues in India and Pepsi claimed that by 2002, Aquafina would contribute 7% of Pepsi's revenues in India.

From "Pure and Safe" To "Play Safe"
In the late 1990s, Parle Bisleri launched an ad campaign to create a distinct brand image-'There is just one Bisleri.' Hoardings and point-of-sale promotion material backed an aggressive print-and-TV campaign, and every interaction with the consumer was used as an opportunity to reinforce the message that Bisleri was "pure and safe."


The entire campaign was built around the tamper proof seals. The campaign focused on the safety provided by the "breakaway" seal, by illustrating the ease with which conventionally sealed bottles could be refilled and recycled. Said Ashok Kurien, CEO, Ambience D'Arcy, Bisleri's ad agency, "Our objective with the campaign was to highlight the tamper-proof seal and create doubt in the consumer's mind of the purity of the other brands.

That is, Bisleri is the only one that guarantees purity." In 2000, in the face of competition from the new entrants, Bisleri decided to penetrate every possible segment of the market by introducing more pack sizes and to establish the brand strongly with trendy packaging. In 2000, Bisleri launched the 1.2 litre pack. This added to the five pack sizes that Bisleri had (500 ml, one, two, five and 20 litres). The new pack was priced at Rs 12.

This pack was targeted at the regular mineral water consumer who is accompanied by a friend and also restaurants and hotels. In the long run, Bisleri planned to replace the standard one litre pack with the 1.2 litre pack. The company felt that although the one litre pack accounted for 35% of sales in terms of volume, it had problems in the form of leakages, loose caps and foreign particles in the water. Bisleri thought that a heavier 1.2 litre bottle would solve most of these problems.

Analysts felt that Bisleri would find it difficult to market an unconventional pack like the 1.2 litre one. This would require increased spending on marketing and advertising. However, according to company officials, the higher margins that a crate of 1.2 litres bottle (12) would generate, would be spent on marketing, advertising and on dealers.

The retailer price for a crate of 1.2 litres bottles would be Rs 120, against a total cost (including excise and sales tax) of Rs 60.87 to the company. Thus, the company would have a margin of Rs 59.13 per crate. The comparable margin for a crate of 1 litre bottles was Rs 44.57. This meant that the company would have an extra Rs 14.56 per crate. Bisleri planned to spend this amount on advertising and marketing.

In 2000, Bisleri also launched smaller packs like the 300 ml cup. This 300 ml cup was targeted at large gatherings like marriages and conventions. A study conducted by Bisleri showed that its one litre pack was not considered trendy enough.


Analysts' felt that since Bisleri had become generic to the category, the one litre pack was not really considered a brand but merely synonymous with the product. The new look was expected to correct this perceptions. In place of the round ringed bottles, Bisleri would be available in hexagonal flat-sleeved bottles. The new pack was already introduced in 500 ml and 5 litre sizes and would be used for other packs. The new design was patented to prevent it from being copied by others.

Said Chauhan, "The new pack is trendy and has been well accepted by the consumers as we have experienced in the case of 500 ml and 5 litre sizes." The new pack also allowed better brand display. Vertical labeling was easier on flat sleeved packages. It made label information visible from all sides of the bottle. Bisleri also planned to target the soft drinks market. Chauhan was confident that by 2003, the water business would grow at the cost of the soft drink market.
Most analysts agreed that this was possible. In 2000, pure bottled water sold over 500 million litres a year. Soft drinks sold over 1 billion litres a year. With an annual growth rate of 40% for water, water sales was expected to catch up with soft drinks. Bisleri planned to target the soft drinks market by adding a fun element to the product. Chauhan felt that soft drinks were all about quenching thirst and having fun.

While it was widely accepted that branded water quenched thirst, there was very little that branded water could do to provide a fun element. Chauhan said that Bisleri would soon launch an ad campaign to address this problem. By 2000, the smaller players also began to position their products on the purity platform. They also offered better trade margins. New entrants like Aquafina and Kinley concentrated purely on building their brands in a big way. Bisleri had to come out with an ad campaign to make its brand stand apart.

In September 2000, Bisleri launched its Play Safe ad campaign. In the print ad, a lady in a bikini is shown lying face down, soaking up the sun. A part of the lady's body is shielded by a bottle of Bisleri with the message: Play Safe on the bottle. The television version of the ad ran for 45 seconds. The film opens with a couple sitting on a beach in front of a bonfire. The girl suddenly starts running and is followed by the boy.

As she collapses on the sand, she whispers something in his ear which sends him back to the bonfire. He rummages through the bags, but can't find what he is looking for. He rushes to the nearest chemist's and picks up a huge carton. Back at the beach, he opens the carton, and finds 500 ml Bisleri bottles inside. The girl quenches her thirst, almost in ecstasy, as the boy watches her with a comical expression on his face. Then comes the message: Play Safe.

The campaign targeted the youth and hoped to convey a social message: young people need to make sure they are safe even when they are having fun. The ad campaign saw a shift in positioning from "pure and safe" to "play safe."

According to Ambience D'Arcy, the shift had been necessitated by the fact that every new entrant in the mineral water market adopted the purity. Said Chauhan, "Our observation is that people consume mineral water not for the minerals, but for safety. Hence the word "safe" is critical."

Will Bisleri Ever be a Rs. 10 Billion Brand?
Parle Bisleri's aggressive marketing was aimed at making Bisleri a Rs 10 billion brand by 2003. However, new entrants into the branded water market like Pepsi and Coca-Cola were equally aggressive in marketing their brands. In August 2001, Kinley launched an ad campaign with the tag line Boond boond mein vishwas (Trust in every drop). The ad focussed on trust in relationships. The 40 second commercial opens in a rural setting, showing cracked earth and a young boy waiting for rain. A Kinley truck arrives and sprinkles water all over.

The boy's face breaks into a smile. The ad also shows a father running behind his son's school truck to hand over a Kinley bottle. Commenting on the ad, Pandrang Row, executive creative director, McCann-Erickson, Kinley's ad agency said, "We were trying to show images where people had to trust the water they were drinking, or giving their children. Kinley is the water you use when you need to be able to trust what you're drinking or giving someone to drink."


In late 2001, Coca-Cola announced that it would enter the bulk segment where Bisleri was a dominant player. The 20 litre bulk water packs would be targeted at institutional and home segment. Kinley's brand positioning of trust and purity would be maintained. With the entry into the bulk segment, Coca-Cola aimed to garner a market share of 40% by 2002. Sanjiv Gupta, Senior Vice-President, Coca Cola India said, "We are aiming to be either number one or a close number two within a year."

Analysts felt that with the cola giants shifting their focus to branded water in India, Bisleri would be the worst sufferer. Chauhan was already planning to sell a 49% stake in Bisleri. However, according to some analysts; he would wait till 2003 when Bisleri was likely to touch a turnover of Rs 10 billion, before selling out the 49% stake. Others felt that given the pace at which Kinley and Aquafina were eroding Bisleri's marketshare, 2003 could be too late. What remained to be seen was whether Bisleri's new positioning would help it to increase its turnover to Rs 10 billion by 2003.

Tuesday, December 7, 2010

About Brand


Everyone is familiar with brands, if nothing else just from looking at adverts and everyday shopping.

From a marketing perspective the brand is more complex than it might at first seem. The brand works at a different levels conveying information about what is on offer, who the product is meant for and what the product says about the buyer.


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" I have been very impressed by the overall management of the project from the brief, through the fieldwork, the analysis conducted to the presentation of results. The communication between yourselves and us has also been clear and prompt.

The presentation gave the audience a clear understanding of a complicated study. Our Circulation & Marketing Director, was also impressed."

Research Manager Northcliffe Newspapers 2005Brands encapsulate a whole range of communication, learning, history, feeling about a product or company within a simple name and logo. But although the name may be simple, the ideas underpinning brands and the different ways in which brands are used are both complex and multi-faceted.

The brand pyramid
The concept of a brand can be thought of as a pyramid consisting of different layers of meaning and involvement.



At its lowest level a brand is simply an identifying mark to distinguish the product from alternatives. Normally, at this simple level, there is an implicit statement of specification. A4 paper consists of paper of a certain size. Low fat yoghurt consists of yoghurt with a maximum level of fat content.

At the next level, the brand becomes more than a mark of specification, it becomes a mark of assurance. Food marked Nestlé will achieve a minimum standard of quality. Cars made by Ford will have a certain level of reliability.

Moving in up another step, the brand starts to represent moments of choice. Drink Coke when you are thirsty. Eat Mars when you need energy. If the brand becomes associated with a choice (in the consideration set), then it is more likely to be purchased. But successful brands can position themselves to become the only choice. Achooo - pass me a Kleenex.

At the next step, the brand provides a mark of association, a badge of a club that the individual wants to be associated with. Here the purchaser is starting to make some form of emotional connection with the brand and to use the brand to establish a self-image to other people. I am in the Apple user club. I wear Nike. I read the Financial Times.

If you then increase this association with the brand to a point of emotional involvement, then the brand starts to represent who the individual wants to be. "The brand is me. This is my brand". One person may say I drink Gordon's Gin, wear Burberry. I am that type of person. Another, I shop in Bodyshop, buy organic food. I am that type of person.


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Brands as relationships
We can also view the brand as a relationship. Ultimately the brand reflects a relationship between the buyer and the product bought (and so indirectly with the supplier). This relationship like all others is based on trust, the fulfilment of promises and common values. This brand will deliver these features and these emotional benefits to you.

Over time the brand relationship changes as needs change. Buyers can become promiscuous, change interests, become bored with their habits. Brands on the other hand can stagnate and wither, or become focused on new customers, or change in their essence.

The brand relationship is fragile. A single event, such as contamination (eg Perrier) or a misplaced word (eg Ratners) can irreparably damage this trust. However, brands can also suffer chronic damage over time - constant failure to deliver on promises, failure to be reliable, failure to deliver on specification diminish and destroy brand value. As an example, the under-performance of Virgin Trains threatens the entire perceptions of the Virgin brand.

There are cases where companies have focused purely on the brand's imagery and completely overlooked the implicit specification and assurance aspects of a brand which rely on basic quality and meeting the implicit service promises (Boo.com is an example). This means that companies should also see the way they deal with distribution channels as part of brand management to ensure that the brand is not compromised on its journey to the customer.

Not surprisingly, brand-focused companies spend a great deal of effort nurturing and developing their brands to maintain their status, value and relevance to the relevant target audience over the long term. In these days of constant innovation and constant newness searching for a better product, it's worth recognising that the strongest brands have been selling the same product for more than one hundred years (Coke, Kelloggs Corn Flakes, Guinness, Wrigleys, ...) through marketing, rather than product innovation.

Strategy of Marketing

Market strategies
Developing a clear and profitable strategy relies on balancing your company's competencies and abilities against the market opportunities into the future.

We offer a strategic development process that starts with strategic analysis and takes you through to implementation. Our marketing effectiveness studies look at how your marketing expenditure can be optimised to maximise your marketing ROI.


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Strategic analysis
Many marketing plans happen by hunch, but there is a better way. Strategic analysis forms the groundwork for the development of market strategies and involves looking at your customers and markets, your competitors and your competencies to identify the areas of opportunity and threat based on what your customers really value and what you can cost effectively deliver.


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Marketing effectiveness
Increasingly financial analysts are looking at how to get the best from marketing budgets and marketing is now no longer just the preserve of the marketing department but impacts on operations through TQM and customer satisfaction, on IT through customer databases, on sales through CRM and sales management and on finance through customer profitability analysis. With so many people now involved in marketing and so many ways to market, marketing effectiveness is a major question.


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Brand development
Brands are no longer just products, a brand may be the company itself and how people think about the company brand affects them as employees as well as customers. Developing and understanding brands is a core part of company management.


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Focus areas
If you have specific areas of marketing that you want help developing, we have experience in

Technology markets
Business markets
Brand development
Market segmentation

Marketing Technology

Internet applications
With the Internet playing an ever increasing role in reaching customers and sharing information about customers, particularly as companies want to understand their customers better and develop new ways of partnering with customers using the range of interaction tools.

More particularly, the Internet is providing a key route for information, comment and feedback from customers to the supplier and between customers about the supplier.


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Focus areas
Our focus on Internet Applications is on helping share information over the web, whether it is through websites aimed at customers, or using the Internet to build knowledge and information within your business. We develop:

Web applications
Market knowledge databases
On-line communities such as social networking groups
IT Tools for marketing
In addition we can provide IT tools to support your marketing, for instance GIS, project management, competitive intelligence gathering or data analysis tools. See some examples of what we can do.


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Websites
A website is practically a prerequisite for even the smallest businesses. Customers will look to your site so they can find out more about your company and check you out before they buy. The quality of your website must reflect the quality of your business and it must offer more than just the text in your brochure, and it must be kept up-to-date and relevant. We can provide professional websites that show your business in the best light online, but with a range of tools that make it easy for you to keep information up-to-date. Alternatively we have DIY one-click website solutions that provide fast, easy, low-cost feature-rich sites (see Notanant)


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Web-applications
With the drive towards second generation Internet web-sites (Web 2.0), it is becoming more important that sites are functional, interactive and not just informational. We develop a range of practical, easy-to-use, distributed web-applications for managing on-line services, from information publishing, to private shared address books, to distributed information systems to subscription based services.

Our web-applications are designed with the Internet in mind and are not merely copies of internal systems. They are standards based and are often available both as PC-based and WAP-based systems without the need for modifying the data.

Our flagship web-application is Notanant which can be used to manage any form of website with members.


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Customer and market knowledge databases
To support the use of information and analysis as a marketing tool, there is a need to build databases to hold information, so that they can be analysed easily and allow for information to be shared and sorted, for instance to support customer knowledge activities.

We develop bespoke market knowledge databases for the collection and dissemination of customer and competitor knowledge. Typically these are web-based systems based around a browser interface and industry standard applications. This allows us to collect and disseminate information through a wide variety of devices allowing for access and use outside the office environment. A demonstration will be available shortly from this site.

One specialist design is self-maintaining databases. For these type of databases, customers have access to and can manage and update their own information. This has the benefit of reducing the chances of data entry error, whilst allowing customers to tell you information from their perspective.


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On-line communities and web-sites
Web-site development and e-commerce need to be in place as another arm of your channels of distribution. The most effective web-sites are those that provide customers with a space to communicate and share information among themselves and with your employees.

These on-line communities can be an extension of your loyalty programmes or customer feedback programmes, or they can just be autonomous in their own right. Some companies worry that by providing a forum for customers to talk to each, problems will be highlighted. But the evidence suggests that open and honest communication is the single most effective way of generating loyalty, particularly if you are taking steps to fix problems.

We have in-house skills in all the major web-technologies and can help you generate your own on-line community. FieldShare was entirely developed in-house including the database and discussion forum elements.


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IT tools for marketing
In addition to bespoke software development (for example our Questionnaire Wizard), we are also able to configure and supply specialist tools for marketing project management and automated competitive intelligence gathering. In addition we can advise on the selection of data analysis tools for the statistical analysis of market research and database data and can provide training if necessary.

One example are Geographic Information Systems (GIS) is simply a mechanism for plotting database information on maps. Much existing business-to-business information contains geographic components and it can be incredibly useful to look at customers and orders by geography both to help with sales management and to provide key analysis to support marketing through seminars for instance.

For instance, if you knew that nearly half of corporate businesses have their headquarters in London and the South East, this would help you focus your marketing to look at solutions local to this area.

Marketing Communication Strategy Development


Raising awareness of your product in your target market is where sales begin, and this is where marketing communications activities begin the selling process.

With today's multiple channels for content to reach potential customers, the art and science of marketing communications has become increasingly important.


The marketing communications function (commonly called "marcom") has many communications tools available. Some companies in an industry might rely on paid advertising in print and online media. While other companies in the same industry might rely on a very different media mix, such as public relations and events.

However, no company can be sure they are using the most efficient media mix without creating a marcom strategy that is aligned with their overall strategic marketing direction.


Turning the strategic direction into marketing messages
The marketing communications strategy process usually begins with creating a "messaging strategy" -- determining the consistent theme or fundamental selling message that will he used in all marketing materials.

Another key part of the messaging process is creating the positioning statement. This two sentence statement tells what you sell, to whom, and why customers should buy it.

As you move through the process of creating a positioning statement, you'll want to capture your brainstorming results, such as in your marketing strategy mind map. Then, refine and test those creative approaches until you settle on your company's positioning statement.

Your positioning statement is critical to making all of the other parts of the marketing communications strategy work well. This is because every awareness-building and product information program needs to paint a clear, concise picture of what you sell and how customers will benefit from using your products.

Selecting effective marketing programs
Once you have settled on a strong positioning statement, you can develop sound strategies for your marcom programs. For most companies this means considering programs such as:

Public relations
Advertising
Web site
Seminars
Conferences and trade shows
Downloadable materials
Direct marketing (offline & online)
Packaging
Event sponsorships
Merchandising promotions
A mind map is a good way to capture ideas about which programs look like they will be most effective. Add these programs to the Marketing Communications section of your strategic marketing mind map. Later, evaluate each program to see if it should be in your final strategic marketing plan.
In large companies where each marketing program has its own manager, you can link your main strategic marketing mind map to each program's own planning mind map.

In companies where the whole marcom strategy is implemented by one team, you can add details about marcom programs in the team's main marketing mind map.


Benefits of a sound marcom strategy

The process of creating a marcom strategy has gotten more complex as more marketing activities move to the Internet. This has made it even more important to understand customer segments and how to communicate with those potential customers.

When you develop a marcom strategy based on a sound strategic marketing view of your market your marcom program will be more effective -- and customers will have a better, more consistent brand experience.

Monday, December 6, 2010

New Marketing Trends in 2010


There are several new marketing trends for 2010 that will have an impact on practically every marketing organization because of new trends in customer behavior, such as:

Shift in consumer mentality from recession to recovery
Changes in how customers make purchase decisions
New technologies for communicating with customers
Let's take a look at the major marketing trends for 2010 that will affect both business-to-business (B2B) and consumer (B2C) companies so we can update our marketing strategies for 2010.


Spotting marketing trends

When something becomes a "hot trend" it does so for two reasons. First, it's a product or activity that has been proven and refined. And, second, it's growing in adoption. The hot marketing trends for 2010 are all visible as we enter the year, and these trends are growing to the point where we need to adjust our marketing communications and sales strategies to take advantage of them.

Big marketing trends for 2010
Some of the hot marketing trends are rather obvious, such as the growing use of social media. But it's important to identify the "big marketing trends" for 2010 that can help define effective marketing strategies for 2010.

Big Marketing Trend #1: Personal — Communicate with individuals to carry on conversations about meeting their needs and solving their problems.

Big Marketing Trend #2: Local — Participate in personal, face-to-face meetings, events, and activities near where your product will be used because fewer customers will be flying to national events and conferences.

Big Marketing Trend #3: Mobile — Reach customers anywhere at any time with the 24/7 connectivity of mobile devices.


These three big marketing trends for 2010 overlap and reinforce each other to provide marketing opportunities to connect with your customers and increase revenue.

Marketing trend opportunities for 2010
Here are four ways you can combine these big marketing trends to create actionable marketing strategies that your competitors may not have thought of yet:

Marketing Trend Opportunity #1: Personal + Mobile — Provide personalized product, service, and solution information when and where customers are thinking about their problems and needs

Marketing Trend Opportunity #2: Personal + Local — Tailor marketing messages based on each person's purchase process, starting with their information gathering and continuing through their searching, purchasing, and reordering.

Marketing Trend Opportunity #3: Mobile + Local — Deliver product and solution information to customers at the location where the purchase decisions are being made using mobile devices and local Internet searches.

Marketing Trend Opportunity #4: Personal + Local + Mobile — Use one-to-one marketing to treat different customers differently — anywhere, anytime, and using any medium they want, whether it's text, telephone, Web, mobile app, or video.


Adapting to new trends in customer behavior
The current economic climate has caused both B2B customers and retail consumers to change how they make purchases in 2010. A longer sales cycle requires greater frequency of contact. Increased price sensitivity requires providing greater value. And, increased customer mobility requires that marketers use new technologies to stay in contact.

The year 2010 will provide marketers with significant opportunities for growth by adopting marketing strategies based on the "new normal" for customer behavior.

Monday, September 13, 2010

Brand


The word "brand" is derived from the Old Norse brandr, meaning "to burn." It refers to the practice of producers burning their mark (or brand) onto their products.

A brand is the personality that identifies a product, service or company (name, term, sign, symbol, or design, or combination of them) and how it relates to key constituencies: Customers, Staff, Partners, Investors etc.


Some people distinguish the psychological aspect, brand associations like thoughts, feelings, perceptions, images, experiences, beliefs, attitudes, and so on that become linked to the brand, of a brand from the experiential aspect.

The experiential aspect consists of the sum of all points of contact with the brand and is known as the brand experience. The psychological aspect, sometimes referred to as the brand image, is a symbolic construct created within the minds of people and consists of all the information and expectations associated with a product or service.

People engaged in branding seek to develop or align the expectations behind the brand experience, creating the impression that a brand associated with a product or service has certain qualities or characteristics that make it special or unique. A brand is therefore one of the most valuable elements in an advertising theme, as it demonstrates what the brand owner is able to offer in the marketplace. The art of creating and maintaining a brand is called brand management. Orientation of the whole organization towards its brand is called brand orientation.

Careful brand management seeks to make the product or services relevant to the target audience. Brands should be seen as more than the difference between the actual cost of a product and its selling price - they represent the sum of all valuable qualities of a product to the consumer. There are many intangibles involved in business, intangibles left wholly from the income statement and balance sheet which determine how a business is perceived. The learned skill of a knowledge worker, the type of mental working, the type of stitch: all may be without an 'accounting cost' but for those who truly know the product, for it is these people the company should wish to find and keep, the difference is incomparable.

A brand which is widely known in the marketplace acquires brand recognition. When brand recognition builds up to a point where a brand enjoys a critical mass of positive sentiment in the marketplace, it is said to have achieved brand franchise. One goal in brand recognition is the identification of a brand without the name of the company present. For example, Disney has been successful at branding with their particular script font (originally created for Walt Disney's "signature" logo), which it used in the logo for go.com.

Consumers may look on branding as an important value added aspect of products or services, as it often serves to denote a certain attractive quality or characteristic (see also brand promise). From the perspective of brand owners, branded products or services also command higher prices. Where two products resemble each other, but one of the products has no associated branding (such as a generic, store-branded product), people may often select the more expensive branded product on the basis of the quality of the brand or the reputation of the brand owner.

Brand Awareness

Brand awareness refers to customers' ability to recall and recognize the brand under different conditions and link to the brand name, logo, jingles and so on to certain associations in memory. It helps the customers to understand to which product or service category the particular brand belongs to and what products and services are sold under the brand name. It also ensures that customers know which of their needs are satisfied by the brand through its products.(Keller) 'Brand love', or love of a brand, is an emerging term encompassing the perceived value of the brand image. Brand love levels are measured through social media posts about a brand, or tweets of a brand on sites such as Twitter. Becoming a Facebook fan of a particular brand is also a measurement of the level of 'brand love'.

Global Brand

A global brand is one which is perceived to reflect the same set of values around the world. Global brands transcend their origins and creates strong, enduring relationships with consumers across countries and cultures.

Global brands are brands sold to international markets. Examples of global brands include Coca-Cola, McDonald's, Marlboro, Levi's, Shell etc.. These brands are used to sell the same product across multiple markets, and could be considered successful to the extent that the associated products are easily recognizable by the diverse set of consumers.

Benefits of Global Branding

In addition to taking advantage of the outstanding growth opportunities, the following drives the increasing interest in taking brands global:

Economies of scale (production and distribution)
Lower marketing costs
Laying the groundwork for future extensions worldwide
Maintaining consistent brand imagery
Quicker identification and integration of innovations (discovered worldwide)
Preempting international competitors from entering domestic markets or locking you out of other geographic markets
Increasing international media reach (especially with the explosion of the Internet) is an enabler
Increases in international business and tourism are also enablers

Global Brand Variables

The following elements may differ from country to country:

Corporate slogan
Products and services
Product names
Product features
Positionings
Marketing mixes (including pricing, distribution, media and advertising execution)
These differences will depend upon:

Language differences
Different styles of communication
Other cultural differences
Differences in category and brand development
Different consumption patterns
Different competitive sets and marketplace conditions
Different legal and regulatory environments
Different national approaches to marketing (media, pricing, distribution, etc.)

Local Brand

A brand that is sold and marketed (distributed and promoted) in a relatively small and restricted geographical area. A local brand is a brand that can be found in only one country or region. It may be called a regional brand if the area encompasses more than one metropolitan market. It may also be a brand that is developed for a specific national market, however an interesting thing about local brand is that the local branding is mostly done by consumers then by the producers. Examples of Local Brands in Sweden are Stomatol, Mijerierna etc...

Ambient Brand

An Ambient Brand is a movement, where the brand is organized around values and social needs instead of promoting a specific product. It is a virtual space, defined by values and occupied by a community of like minded people. Whereas a traditional brand is entirely independent of products and their parent corporations, an ambient brand is an independent social movement that companies can participate in. They are not selling products, they are allowing their company to participate in a social movement and allow their brand to be identified with this. It exists as a shared values space where consumers gather, converse and ultimately transact with organizations that are in alignment with the values associated with that community. Corporations do not create ambient brands. They must qualify for inclusion within them by demonstrating that they share the values and will service the interests of their associated communities. The brands develop organically as a result of emerging social and cultural codes and are materialized through peoples ability to organize around them through the use of mainly virtual communities on the web.

Brand name

The brand name is quite often used interchangeably within "brand", although it is more correctly used to specifically denote written or spoken linguistic elements of any product. In this context a "brand name" constitutes a type of trademark, if the brand name exclusively identifies the brand owner as the commercial source of products or services. A brand owner may seek to protect proprietary rights in relation to a brand name through trademark registration. Advertising spokespersons have also become part of some brands, for example: Mr. Whipple of Charmin toilet tissue and Tony the Tiger of Kellogg's. Local Branding is usually done by the consumers rather than the producers.

Types of brand names

Brand names come in many styles. A few include:
Acronym: A name made of initials such as UPS or IBM
Descriptive: Names that describe a product benefit or function like Whole Foods or Airbus
Alliteration and rhyme: Names that are fun to say and stick in the mind like Reese's Pieces or Dunkin' Donuts
Evocative: Names that evoke a relevant vivid image like Amazon or Crest
Neologisms: Completely made-up words like Wii or Kodak
Foreign word: Adoption of a word from another language like Volvo or Samsung
Founders' names: Using the names of real people like Hewlett-Packard or Disney
Geography: Many brands are named for regions and landmarks like Cisco and Fuji Film
Personification: Many brands take their names from myth like Nike or from the minds of ad execs like Betty Crocker

The act of associating a product or service with a brand has become part of pop culture. Most products have some kind of brand identity, from common table salt to designer jeans. A brandnomer is a brand name that has colloquially become a generic term for a product or service, such as Band-Aid or Kleenex, which are often used to describe any kind of adhesive bandage or any kind of facial tissue respectively.


Brand identity

A product identity, or brand image are typically the attributes one associates with a brand, how the brand owner wants the consumer to perceive the brand - and by extension the branded company, organization, product or service. The brand owner will seek to bridge the gap between the brand image and the brand identity. Effective brand names build a connection between the brand personality as it is perceived by the target audience and the actual product/service. The brand name should be conceptually on target with the product/service (what the company stands for). Furthermore, the brand name should be on target with the brand demographic.Typically, sustainable brand names are easy to remember, transcend trends and have positive connotations. Brand identity is fundamental to consumer recognition and symbolizes the brand's differentiation from competitors.

Brand identity is what the owner wants to communicate to its potential consumers. However, over time, a product's brand identity may acquire (evolve), gaining new attributes from consumer perspective but not necessarily from the marketing communications an owner percolates to targeted consumers. Therefore, brand associations become handy to check the consumer's perception of the brand.

Brand identity needs to focus on authentic qualities - real characteristics of the value and brand promise being provided and sustained by organisational and/or production characteristics.

Multi-brands

Alternatively, in a market that is fragmented amongst a number of brands a supplier can choose deliberately to launch totally new brands in apparent competition with its own existing strong brand (and often with identical product characteristics); simply to soak up some of the share of the market which will in any case go to minor brands. The rationale is that having 3 out of 12 brands in such a market will give a greater overall share than having 1 out of 10 (even if much of the share of these new brands is taken from the existing one). In its most extreme manifestation, a supplier pioneering a new market which it believes will be particularly attractive may choose immediately to launch a second brand in competition with its first, in order to pre-empt others entering the market.

Individual brand names naturally allow greater flexibility by permitting a variety of different products, of differing quality, to be sold without confusing the consumer's perception of what business the company is in or diluting higher quality products.

Once again, Procter & Gamble is a leading exponent of this philosophy, running as many as ten detergent brands in the US market. This also increases the total number of "facings" it receives on supermarket shelves. Sara Lee, on the other hand, uses it to keep the very different parts of the business separate — from Sara Lee cakes through Kiwi polishes to L'Eggs pantyhose. In the hotel business, Marriott uses the name Fairfield Inns for its budget chain (and Ramada uses Rodeway for its own cheaper hotels).

Cannibalization is a particular problem of a "multibrand" approach, in which the new brand takes business away from an established one which the organization also owns. This may be acceptable (indeed to be expected) if there is a net gain overall. Alternatively, it may be the price the organization is willing to pay for shifting its position in the market; the new product being one stage in this process.

Wednesday, August 18, 2010

Politics & Marketing in India



I see attack politics and attack marketing as pretty much the same thing. Or, a distinction without much of a difference, anyway. Politicians generally attack enemies who threaten their getting elected or getting some policy implemented. If you aren't a threat, though, you are basically ignored in that system. And if you are a little guy trying to attack powerful politicians, you are generally ignored, too. This is why collective protest is a necessary prerequisite for change. Strength comes in numbers. You have to make yourself a threat to even get noticed, and that has to happen well before you have a shot at changing things (whatever your thing is). But from the politicians point of view, since they have the power, it seems the attack principle dictates that they shouldn`t want to give too much exposure to a competitor or group they don`t support, so many politicians actually tend to attack pretty carefully. The rhetorically skilled know this very well. They think out a few moves ahead. Who should do the attacking? What`s the venue of the attack? What will the counter punch look like? Where will it come from? And when? What does it mean when no counter attack comes back at all and instead they are met with silence? And heck, what if the opponent praises in return instead of attacking as expected? The answers to these questions are imprecise at best.

I used to do competitive marketing, and I went through this exact same process. However, I always told my clients that attacks are best done by third parties and only in response to a precipitating attack. In other words, you don`t attack first. It`s not worth the headline. Instead, you be the one responding. Here`s why: those who attack first generally give away at least some of their position, and that gives you much more flexibility to respond. Unskilled politicians and marketers make this mistake all the time when they shoot their mouths off, but the concept holds up pretty well over time. I`ve said before that I think people attack for basically two reasons: (1) they are afraid that someone smaller than them may grow up and kick their butt, or (2) they are small themselves and want to pick a fight with a big guy to get attention. Either way, if you study your attacker you can learn a lot.

It's a game, granted. And everyone in it knows this. Most attacks can be quite easily turned around with some basic facts and logic. But rationality is irrelevant in the arena of delivering really good emotional propaganda for the purpose of influencing behavior. That's why attacks can work in some cases if they generate a strong reaction from the attacked. Attacks spread fear. And many times that fear shapes how people think if it`s not characterized properly. In fact, the term used to describe this process is sometimes called FUD -- fear, uncertainty, and doubt. It`s a silly sounding term, but it should be taken seriously because the best propagandists out there can be rather dangerous people if they have a power base and resources supporting them (a country, a company, an interest group, a foundation, a university, a union, whatever). In other cases, however, attacks and fear mongering backfire badly, and we saw this in the recent political campaign in our country where pols on both sides(BJP & Congress) took some things too far and the people (remember the people?) called them out on it.

So, what should you do if you are attacked in the marketplace? First, stop. Think. Don`t react immediately with the first counter attack you can think of in the first publication you can find. You`ve been attacked so you now have the upper hand for a period of time (not forever, though). What is the attack telling you about your attacker? Is he or she responding go your attack? If so, you deserve the counter attack so enjoy your stupid little fight. If not, though, something else is going on and you may be in a much better position than you think. It means that you got someone`s attention for some reason. You may have not even intended to get this attention, but that`s what the attack may mean and that`s valuable competitive intelligence if you can confirm it. Remember, if you were really irrelevant, chances are you`d be ignored. So, dig right there before responding and respond to defend and deflect not to attack back. And if you can praise the attacker (or his product or community or company or whatever) so much the better. Attackers are generally simple minded and angry and unable to deal with praise as a response. Alternatively, your attacker could just be engaging in bad marketing or politicking. Consider that too. Either way, you have the upper hand if you do the responding, not the attacking.

Friday, July 16, 2010

The New symbol of Indian Currency


The Indian Cabinet finalized a symbol for its currency, the Indian Rupee on Thursday July 15th 2010, denoting the strength of its growing economy joining a select club of countries whose currencies have a unique identity. The Indian Rupee today became the fifth currency in the world to get its unique symbol which is an amalgam of the Devnagiri Script 'Ra' and the Roman capital 'R' without the stem and two parallel lines running at the top symbolizing an equality sign.

India retains the reputation of developing the concept of coinage and issued some of the earliest coins in the history of mankind, which were the base for other currencies of the world. Continuing on the trails of its golden heritage, the Indian Rupee, the currency of Modern day India has formalized a new symbol for the Indian rupee, which reflects and captures the Indian ethos and culture. The Indian rupee is one of the well-established currencies in the world and in terms of sheer volume, the Indian Rupee is one of the most widely used financial instrument in the world currently being used by almost 20% of the world's population. With India becoming the hotbed of financial investment in recent times, the Indian Rupee is now ready to write a new chapter to complement its glorious past heritage. The significant strength exhibited by the Indian rupee in the recent years along with the continued good performance of the Indian economy have raised the issue of greater internationalization of the Indian rupee. Developing an important brand for the wider Indian economy among international investors and highlighting India's increasing global economic ambitions, the country has joined an elite group as the Indian cabinet approved a new symbol for its national currency emulating the pound, the euro, the dollar and the yen in having its unique distinguishing identity.

Until now, the most common notation for the Indian Rupee “Rs.” was used also being used by several Asian nations including Pakistan, leading international traders to rely on the clunky “INR” to distinguish it. The new symbol will distinguish the Indian currency from currencies of other countries like Pakistan, Nepal, Sri Lanka and Indonesia which also use the word "rupee" or "rupiah" to identify their respective currencies. The new symbol, a combination of the Devnagiri script 'Ra' and the Roman capital 'R', will be used by all individuals and entities after its incorporation in `Unicode Standard’, ‘ISO/IEC 10646’ and ‘IS 13194’.

The need for the symbol had become necessary because of the Indian economy's rapid growth, which has propelled it to become one of the largest economies of the world. The unique symbol for the Indian currency comes after the Reserve Bank of India recently published a study looking into the potential of the rupee to be used in international trade and even as a possible reserve global currency, given the problems confronting the US economy and the dollar. The Indian rupee has been one of the best performing currencies among emerging market economies in the first quarter of 2010, beat currencies from other emerging market economies like Brazil, Russia, Thailand, the Philippines, Vietnam and South Korea.

Currently, Indian rupee is available only in the denomination of Re.1 and Rs.2 coins and notes ranging from Rs.5 to Rs.1000. Paisa coins valuing 25p and 50p are rarely used. A unique feature of the Indian rupee note is its language panel, which depicts what that denomination is called in 15 of the 22 official national languages of India. The Indian currency has been one of the strongest in South Asia but has been hampered in recent times by illegal activities of fake currency notes being pumped into its borders from neighboring countries like Pakistan and Nepal. The attempt to pump in fake notes to destabilize and devalue the Indian currency has so far not had much of an impact on its robust growth mechanism which is backed by solid foundations and deep economic reforms. The publishing and printing of fake Indian currency continues to be a headache for the Indian government as it has started to use fine quality paper and inks that are difficult to imitate. Although India’s currency is on a surge, and it has made its mark as the top-performing currency the extent to which the symbol will gain international usage and cache remains to be seen. The rupee has grown increasingly stable in value. Versus the dollar, it made strong gains until the global flight to the dollar at the height of the worldwide financial crisis.

History Of The Indian Currency

India is the place where the concept of coinage developed at its earliest in around 6th century BC which later on built the base for other currencies of the world. According to the historians, the Indian currency i.e. rupee was brought into existence by Sher Shah Suri in the 16th century and it was evaluated as equal to 40 copper coins per rupee. The dominance of Mughals over India started diminishing when the British arrived in the country. The paper money was introduced under their reign in the latter part of the 18th century. Bank of Hindostan made the earliest rupee notes issues in the year 1770. After independence, the Indian rupee was unified by the Government of India as a single currency for the Republic of India.

Indian Currency Related Funds

After the gradual success of Indian equity ETFs as a low-cost option to gain diversified exposure to Indian equities, more and more investors are looking at the Indian currency funds as with the surge in the Indian currency, Rupee exchange traded funds have also performed handsomely compared to funds of other emerging economies of the world.

For investors who want to invest in currency in the emerging Indian currency market, a favorite investment vehicle continues to be the WisdomTree Dreyfus Indian Ruppee Fund (ICN). The ETF seeks to achieve total returns reflective of both money market rates in India available to foreign investors and changes in value of the Indian Rupee relative to the U.S. dollar. The fund normally invests in a combination of U.S. money market securities with forward currency contracts and currency swaps that are designed to create a position economically similar to a money market security denominated in Indian Rupee. The average portfolio maturity is 90 days or less. It does not purchase any securities with a remaining maturity of more than 397 calendar days. The fund is non-diversified.

With an expense ratio of 0.45%, it seeks to give investors a yield comparable to local money-market rates available to foreign investors. It also provides exposure to the movement of the rupee against the U.S. greenback. However, WisdomTree points out that the ETF is not a money market fund and isn't required to maintain a constant share price.


ICN Performance
52 Week Return: 5.41%
YTD Return: -0.08%
1 Week Return: 0.08%
2 Week Return: 0.76%
4 Week Return: -0.36%
13 Week Return: -4.84%
26 Week Return: -2.10%
ICN Expenses & Fees
* Expense Ratio: 0.45%
* Category: Currency
* Category Range: 0.35% to 0.89%
* Category Average: 0.5%
Issuer: Wisdom Tree
Expense Ratio: 0.45%

Another key instrument to bet on he Indian currency is the Market Vectors Indian Rupee-USD ETN (INR) that tracks the exchange rate of the U.S. Dollar against the Indian Rupee. The ETN is an unsecured debt security issued by Morgan Stanley and is based on the S&P Indian Rupee Total Return Index. Total return means that interest earned on funds deposited are reinvested rather than distributed. The Indian Rupee ETN gives investors a low cost way to quickly gain exposure to the movement in the dollar-rupee exchange rate. The annual expense ratio is 0.55 percent and the ETN doesn’t currently pay a dividend.


INR Performance
52 Week Return: 5.22%
YTD Return: -0.05%
1 Week Return: 0.32%
2 Week Return: 1.01%
4 Week Return: -0.42%
13 Week Return: -5.29%
26 Week Return: -3.00%
INR Expenses & Fees
* Expense Ratio: 0.55%
* Category: Currency
* Category Range: 0.35% to 0.89%
* Category Average: 0.5%

Practically speaking, ETNs work much the same way as ETFs, but they’re actually a form of debt instrument. The failure of an ETF provider should, in theory, has no impact on the value of an ETF, because it is backed by securities deposited with a custodian in the name of the ETF itself. ETNs on the other hand are merely structured finance products backed by the unsecured debt of their providers. Holders are therefore exposed to the credit risk of the provider.

The Indian Economic Growth Story

India's economy has experienced rapid growth since liberalization reforms in the early 1990s reduced controls on foreign trade and investment, and the country is widely forecast to become a global superpower. The Indian government predicts the economy will grow by 8.5 % this fiscal year and should hit double-digit expansion within five years. According to the International Monetary Fund, the outlook for India remains positive. Rising incomes should support consumption growth, and robust business confidence, high capacity utilization, and buoyant corporate profits will bolster investment. Over the next few years, growth is likely to moderate toward its potential rate of 8 percent, buttressed by favorable demographics and robust productivity gains.

Thanking you.......
Kamal

Monday, June 28, 2010

Brand strategy of Hindustan Unilever Ltd


UMBRELLA BRANDS

The 1980s witnessed a revolution in the understanding of the working of the brands. Marketers depict brands as a reflection of customers’ own personalities, so that they can relate to their products well. In fact the distinguishing aspect of the modern marketing has been its focus upon the creation of differentiated brands and using them as weapons for launching multi-level attacks on competition. Market research has been used to help identify and develop bases of brand differentiation. A brand identifies a product and its sources, but it does even more. Along came brand extension. Today brand extension strategies are widely employed because of beliefs that they build and communicate strong brand positioning, enhance awareness and increase profitability.
Brands are often extended beyond their original categories to include new product categories. Research has proved that the success of brand extension depends on the transfer of parent brand awareness and associations to the extension. The transfer of these quality perceptions is the key in umbrella branding. An umbrella brand is a brand that covers diverse kinds of products which are more or less related. It applies also to any company that is identified only by its brand and history. It is contrasted with individual branding in which each product in a portfolio is given a unique identity and brand name.
Mr. K.R.Senthilvelkumar, a professor at Jansons School of Business offers the most pragmatic of reasons behind an umbrella brand strategy, “with scarce financial resources, firms cannot afford to allocate huge budgets for building and maintaining several brands”.
Nowadays consumers have become quite unpredictable in their newspaper-reading or TV-viewing habits, it is very difficult to assure the reach of messages to the target audiences. The advertiser has to use many broadcast and print media with high frequency to create the desired effect for every brand, which ultimately puts huge burden on the budget. Hence, companies consider it wise to maintain a minimum number of brands in their portfolio so that they can do justice to each by effectively distributing their investment for promotion purpose.
Yes, umbrella branding is widely practiced. The Confederation of Indian Industry's second FMCG (fast moving consumer goods) conclave in 2003 almost declared that umbrella branding was the way to go in a competitive market environment. In an interesting anecdote, R S Sodhi, GM Marketing (Gujarat Cooperative Milk Marketing Federation l), compared the umbrella brand and individual brands to an Indian family, where in umbrella brands - like the Indian family, the father is the head, looking over the children. When they grow up and become independent, they hold the umbrella for the family. Individual brands on the other hand are like a western family, who grow up fast and leave the father behind. Amul’s strategy of using “umbrella branding” has really paid off. Amul’s advertising and marketing spend has never exceeded 1% of its revenues. Most other food companies spend 6-7% of revenues on advertising and marketing. They (GCMMF) are not big spenders compared to Britannia or Nestle. Despite a limited budget, Amul’s creatives—in the form of billboards or the Taste of India campaign—have always managed to evoke a larger-than-life brand feel, consistency and spirit of Indian culture in a contemporary way.
Companies phase out the brands which have become redundant and retain one or two umbrella brands for every category with necessary variations under each. For example consumer goods major Reckitt & Colman India Ltd. chalked out an expansion strategy to introduce 20 new brands in the year 1999-2000. The strategy also involved repositioning its existing brands and consolidating sub-brands under its main umbrella brands - Dispirin, Dettol, Harpic and Cherry Blossom. The strategy was designed to vault Reckitt & Colman, in terms of sales, into the big league. With the launch of new brands and the repositioning of its existing brands, the company aimed to achieve expected sales growth. The strategy worked well as Dettol as an antiseptic lotion provided brand support to Dettol soap, which was re-launched in a fragrant form called Dettol Fresh to take on HLL's Liril. Cherry Blossom acted as a mother brand for several easy-to-use home products.
Hindustan Unilever Ltd’s (HUL) beverage brands have been amalgamated under two umbrella brands – Brooke Bond and Lipton and in the fabric wash category, the company has retained only Rin, Surf and Wheel, HUL has withdrawn brands such as Sunlight, 501, Dalda and Nihar; it plans to withdraw some more brands and group them under a few umbrella brands. HUL is currently focusing on 35 power brands.
Nivea cosmetics brand has a presence in huge number of product categories and countries. Once upon a time Nivea's performance prompted a yahoo.com news article to name it the 'Queen of Mega Brands.' This title was appropriate since the brand was present in over 14 product categories and was available in more than 150 countries. Nivea was reportedly believed to be a brand of local origin - having been present in them for many decades. This fact went a long way in helping the brand attain the leadership status in many categories and countries. According to analysts, the brand was the single largest factor for the 4.4% increase in the company's (Beiersdorf) revenues (€ 4.74 billion) and 10.7% increase in after-tax profit (€ 290 million) for the year 2002. Beiersdorf never tried to disturb the umbrella branding of Nivea and got fruitful results.
Today as organized retailing is gaining popularity, we can see that popularity of private labels owned by retailers. Retailers do not feel the need to develop many brands for various categories because it is the loyalty towards their store name which draws and retains the customers. Hence it is the umbrella retail store name which will be the brand for various product categories and not individual names for each. Customers prefer these brands over that of manufacturers, due to the fact that they address their functional needs well. The retailers also enjoy high margins for private labels. Today a retail chain like Shopper’s Stop’s 20% apparel section is driven by private labels. There are others like Trent from the TATAs which has developed its business model purely on private labels.
From Asian Paints in 2003 to Electrolux, Onida and Airtel in 2004, they have all made a move from individual product branding to umbrella branding. Just a few year ago Bharti Televentures had brand Airtel for mobile services, Touchtel for land line and India One for long distance calls. But with Airtel dominating the group's ad spends, the company figured that the other brands were hardly making their presence felt. The unified licensing regime in December 2003 - which means that only one license is required to offer fixed, mobile and other services - acted as a catalyst (new Airtel logo/ Airtel outlets). So come September 2004 and the company started selling all its services under one brand name - Airtel. It claims that the move not only upped brand visibility but also charged up its distribution network.
No doubt, umbrella branding has a number of advantages over individual brands in terms of low promotional costs and easy acceptance in trade but umbrella branding imposes on the brand owner a greater burden to maintain consistent quality and brand equity. If the quality of one product in the brand family is compromised, it could reduce sales of all the others. Single umbrella branding works relatively better for services like telecom; it may not be feasible in cases where there is a lesser degree of cohesion between categories, product values and target customers. So, maintaining a few umbrella brands is better option. For instance, suppose LG, a tech brand as far as Indian consumer is concerned, wants to sell you talc or toothpaste or detergent under that name. Consumers would find it very difficult to say what is transferred value from LG TV sets which they’re now going to put on their skin.
Nokia, a moralist for single umbrella branding dropped their single umbrella brand strategy in 2006 in naming it’s products. The company believed it needed to have a look at its competitors’ book. After the roaring success of the Moto RAZR, PEBL, SLVR and ROKR series, the Finnish mobile handset manufacturer felt that consumers found names easy to remember compared to the usual mundane numbers. Even LG launched its popular Chocolate range of phones under the Black Label series. For Nokia, barring few exceptions, numbers have been the only way its phones have been branded so far - remember 1100, 2600, 3310, 6020?
In 2006 they launched Nokia 8800 Sirocco Edition (a mixture of names and numbers). Nokia introduced this approach to make it easier for customers to navigate across their range of phones. They also launched E-series phones (which serve business users) and N-series (which have multimedia features).
While some players say that the naming trend will be restricted to the high-end, feature-led phones(for example- LG is also banking on the name game but in that case it is confined to the high-end range of designer phones), others like Motorola are banking on names irrespective of price slabs. Motorola believes that consumers don't look at these names in an abstract manner and therefore names convey a message to consumers.
A few umbrella brands or individual brands? According to experts, independent brands only make sense when the product clearly has a different proposition from the company brand; like Lexus from Toyota and Swatch from Omega. In the case of Asian Paints, there were so many sub-brands, there was a reduction of media weights for advertising each entity. Then, the company shifted to a brand-centric portfolio, which involved a change of logo, product names, packaging and advertising. But the response from the trade and consumers has been positive, overall brand synergy and shop presence have increased, and the advertising is more effective.
Most probably in near future the media environment will make it impossible to create newer brand names and the conditions at the consumer level, as well as the environment. So unless the product is clearly different in the mind of the consumer, umbrella branding is the way to go. Umbrella brands are going to rule!
THANK YOU

Saturday, June 26, 2010

HLL – Power Brand Strategy

Abstract

This case let provides an overview of the branding strategies of Hindustan Lever Limited (HLL), the Indian arm of the Unilever group. It describes the rationale behind the strategy and the concerted efforts of the company to focus on certain select brands. The case let sheds light on the brand extension strategy undertaken by HLL as part of the modified branding strategy. Finally, the caselet gives an idea of the complexities involved in such a branding strategy.
Issues:

» Power branding strategy
» Importance of consistency in conveying core benefits of the brand
» Role of mother brands
» Developing sub-brands under mother brands

Introduction

In 2001, Hindustan Lever Limited (HLL), the Indian arm of the Unilever group, restructured its strategy to concentrate on its core brands – brands that add to the bottom line of the company. This was because the FMCG segment, which accounts for most of HLL’s business, witnessed lower growth rates in comparison to the double digit growth rates in the nineties.

Besides, the company’s core competence was in these consumer brands where the top 30 of its brands contributed to 75% of its sales. Based on these factors, HLL identified 30 national power brands and 10 regional brands from its portfolio of around 110 brands and directed its entire marketing efforts at developing and building them. Focus on select brands helped HLL to increase the scale of resources and spend more per brand. According to Mr. M. S. Banga, Chairman, HLL, "Our objective is to deliver directionally with the focus on certain key products.

Questions for Discussion:

1. Analyze the branding strategy used by HLL. What were the advantages that HLL expected to secure by using such a strategy?

2. By undertaking a power brand strategy, HLL exited from certain segments. This enabled regional players to operate and develop their brands. Besides, some of the sub-brands were repositioned under mother brands in different segments. How did these changes in the branding strategy affect the marketing communications campaigns of HLL?

Wednesday, June 9, 2010

RAAJNEETI & MARKETING


The movie so called RAAJNEETI is realsed produced by Mr. Prakash Jha a man of Bihar soil. The management of character’s & branding of Prakash jha in the movie is really worth full. Movie will go hit that’s credit goes to its marketing & campaign made by.
Had sort of stopped updating any post on movie marketing, as for past few months most of the Bollywood releases have been doing almost the same stuffs for promotion – websites, social media, television presence, reality shows participation, some general on ground events, radio messages etc. Their marketing strategies looked repetitive and formulaic. But with Raajneeti, things seem to be different. Not only the movie is in news because of its political semblances but their promotion campaign which is revolving around the integration between reel theme and real issues is also attracting enough eyeballs amongst interested common man & the media fraternity.
After Aamir Khan touring across India for the promotion of 3 idiots amongst mass, now its stars like Katrina Kaif & Ranbir Kapoor who were on a nationwide on-ground campaign to promote their upcoming movie Rajneeti. Keeping the political theme in mind, Ranbir Kapoor and Katrina Kaif have been on a run, hosting debates called “Aaj ki Raajneeti” in colleges in Bangalore, Delhi, Chandigarh, Lucknow, Kolkata, Indore and Ahmedabad. The groups discuss political and social topics concerning youth on varous channels like Aajtak, Star news etc. For instance, at IIM Bangalore the discussion was on youth taking active part in politics. As a part of this discussion cum promotion drive, the team is raising issues such as whether voting should be compulsory in the country; whether a year’s military training should be mandatory for every citizen; and whether film stars should join politics.

Sunday, June 6, 2010

Marketing Mix


7P's of the marketing mix



Marketing professionals and specialist use many tactics to attract and retain their customers. These activities comprise of different concepts, the most important one being the marketing mix. There are two concepts for marketing mix: 4P and 7P. It is essential to balance the 4Ps or the 7Ps of the marketing mix. The concept of 4Ps has been long used for the product industry while the latter has emerged as a successful proposition for the services industry.

The 7Ps of the marketing mix can be discussed as:

Product
It must provide value to a customer but does not have to be tangible at the same time. Basically, it involves introducing new products or improvising the existing products.

Price
Pricing must be competitive and must entail profit. The pricing strategy can comprise discounts, offers and the like.

Place
It refers to the place where the customers can buy the product and how the product reaches out to that place. This is done through different channels, like Internet, wholesalers and retailers.

Promotion
It includes the various ways of communicating to the customers of what the company has to offer. It is about communicating about the benefits of using a particular product or service rather than just talking about its features.

People
People refer to the customers, employees, management and everybody else involved in it. It is essential for everyone to realize that the reputation of the brand that you are involved with is in the people's hands.

Process
It refers to the methods and process of providing a service and is hence essential to have a thorough knowledge on whether the services are helpful to the customers, if they are provided in time, if the customers are informed in hand about the services and many such things.

Physical (evidence)
It refers to the experience of using a product or service. When a service goes out to the customer, it is essential that you help him see what he is buying or not. For example- brochures, pamphlets etc serve this purpose.

MARKETING FUNDAMENTALS


The marketing concept is the philosophy that firms should analyze the needs of their customers and then make decisions to satisfy those needs, better than the competition. Today most firms have adopted the marketing concept, but this has not always been the case.

In 1776 in The Wealth of Nations, Adam Smith wrote that the needs of producers should be considered only with regard to meeting the needs of consumers. While this philosophy is consistent with the marketing concept, it would not be adopted widely until nearly 200 years later.


To better understand the marketing concept, it is worthwhile to put it in perspective by reviewing other philosophies that once were predominant. While these alternative concepts prevailed during different historical time frames, they are not restricted to those periods and are still practiced by some firms today.


THE PRODUCTION CONCEPT

The production concept prevailed from the time of the industrial revolution until the early 1920's. The production concept was the idea that a firm should focus on those products that it could produce most efficiently and that the creation of a supply of low-cost products would in and of itself create the demand for the products. The key questions that a firm would ask before producing a product were:
• Can we produce the product?
• Can we produce enough of it?
At the time, the production concept worked fairly well because the goods that were produced were largely those of basic necessity and there was a relatively high level of unfulfilled demand. Virtually everything that could be produced was sold easily by a sales team whose job it was simply to execute transactions at a price determined by the cost of production. The production concept prevailed into the later.


THE SALES CONCEPT

By the early 1930's however, mass production had become commonplace, competition had increased, and there was little unfulfilled demand. Around this time, firms began to practice the sales concept (or selling concept), under which companies not only would produce the products, but also would try to convince customers to buy them through advertising and personal selling. Before producing a product, the key questions were:
• Can we sell the product?
• Can we charge enough for it?
The sales concept paid little attention to whether the product actually was needed; the goal simply was to beat the competition to the sale with little regard to customer satisfaction. Marketing was a function that was performed after the product was developed and produced, and many people came to associate marketing with hard selling. Even today, many people use the word "marketing" when they really mean sales.



THE MARKETING CONCEPT


After World War II, the variety of products increased and hard selling no longer could be relied upon to generate sales. With increased discretionary income, customers could afford to be selective and buy only those products that precisely met their changing needs, and these needs were not immediately obvious. The key questions became:
• What do customers want?
• Can we develop it while they still want it?
• How can we keep our customers satisfied?
In response to these discerning customers, firms began to adopt the marketing concept, which involves:
• Focusing on customer needs before developing the product
• Aligning all functions of the company to focus on those needs
• Realizing a profit by successfully satisfying customer needs over the long-term
When firms first began to adopt the marketing concept, they typically set up separate marketing departments whose objective it was to satisfy customer needs. Often these departments were sales departments with expanded responsibilities. While this expanded sales department structure can be found in some companies today, many firms have structured themselves into marketing organizations having a company-wide customer focus. Since the entire organization exists to satisfy customer needs, nobody can neglect a customer issue by declaring it a "marketing problem" - everybody must be concerned with customer satisfaction.
The marketing concept relies upon marketing research to define market segments, their size, and their needs. To satisfy those needs, the marketing team makes decisions about the controllable parameters of the marketing mix.