CII Marketing Summit 2013: ‘Markets change; aspirations do not’

The theme for the final session of the 13th CII Market Summit 2013, was ‘360 Degree Marketing - Brand strategy for a changing World’. Thomas Varghese, CEO- textile business, Aditya Birla Group and chairman, CII National Committee on Marketing 2013-14, was the moderator.

The session began with Ian St-Maurice, senior expert, McKinsey & Company, Singapore, talking about the importance of branding.

  

‘India needs to focus on branding’

Maurice said, “We don’t need to show numbers to prove the point that branding is massively important. The benefits of a good brand are massive. Indian companies need to practice branding as there is a gap between the way brands are handled in India and the Western market. Having said that, India has a good base and is ahead of China and Indonesia.”

He then explained the importance for brands to be patient and not be very reactive. He said, “There is a little gloom in the market. The markets don’t reward brands that are too reactive.” He backed this statement by citing the example of two tobacco majors – Camel and Marlboro: “Camel has undergone several changes in its brand, while Marlboro has stayed consistent. Marlboro is the clear leader between both the brands.”

Maurice then referred to a video created for India’s 20th Independence Day in 1967. “The video asked people about aspirations. Watching the same video, 46 years later, people’s aspirations haven’t changed. That shows that markets change, but aspirations do not. So, marketers should not look to change that much. Apple’s advertising is a case to follow. It looks pretty similar to what it was 15 years ago, even though there products have undergone a drastic change.”

The McKinsey official urged marketers to follow the fighter pilot strategy – OODA (Observe, Orient, Decide and Act). “If companies react after OODA, they’ll be winners,” surmised Maurice.

  

Indians are used to VUCA

Sunil Kataria, chief operating officer-sales, marketing and SAARC, Godrej Consumer Products, followed McKinsey’s Maurice. He began by expressing his disagreement with Maurice, on Indian companies lagging in branding.

Kataria then spoke about how Godrej has been facing the slowdown. He said, “GCPL has been beating competitors during the slowdown. When slowdowns hit after a boom, consumers are in a mood of denial and that’s the challenge for marketers. Consumers don’t change behaviours. At Godrej, we have a programme called Conquest, which stands for consumer quest. It’s our own research. Market research can be very tricky as it goes through many hands before it’s downloaded to a marketer. There’s no worse way to have transaction loss and hence you have to research yourself instead of outsourcing it to companies.”

“While there’s a section of consumers who are in a state of denial, there are some who start evaluating consumption. These consumers either switch brands or reduce consumption if they are brand loyal. So brands have to create a new value. Value isn’t about price but it is about redefining your product. Marketers should look to be investing in brands that actually have a differentiator over competitors. That’s what we did with Cinthol, when we launched our ‘Alive is Awesome’ brand campaign. We recrafted the value, which made us do well,” he added.

Innovate your way out of a slowdown

Kataria then asked marketers to look to innovate during a slowdown. He said, “Innovation is also a long-run process and cannot be done overnight. One of the biggest deltas we have seen at GCPL is because our new products have done well. When the consumer is looking to revalue, options are needed. Until last year, only L’Oreal was known in the hair crème category. The penetration of this category was only seven per cent. So, we saw an opportunity here and launched a product in this category in a sachet and priced it only at Rs 30. That single product has helped us in a big way.”

He then spoke about Godrej Aer: “We saw an opportunity in the after smoke musk category and launched Godrej Aer. Smokers don’t like smelling of cigarettes, or their car smelling of cigarettes and hence we launched in that category.”

Influencers channel works well

Kataria also urged marketers to look at alternative channels instead of targeting only TV. “We follow the IMC (integrating marketing communication) formula at Godrej. We pick an idea and then chase it in multiple media. When consumers are in a down beat mood, the influencer channel works well. We realised that car fresheners are not bought through normal FMCG retail outlets, but only through car accessory shops. We weren’t adept in that category, but we entered it because owners of car accessory shops have the biggest influence on car owners.”

Kataria’s final piece of advice for marketers during slowdown was to invest during a slowdown. “These are times when inventory is going empty and so marketers can bargain hard. Multiple spots can be purchased to get a high impact with one’s communication,” he surmised.

  

360 degree-advertising is now outdated

Prakash Nedungadi, group head consumer insights and brand development, Aditya Birla Group, spoke about how 360 degree advertising around the consumer is now outdated, and the new 360 is how marketers look around rather than surrounding the consumer with activity.

Nedungadi then explained how marketers should be looking to make their brands win during a slowdown. He said, “The most important thing during a slowdown is that you must be made available. The first moment of truth is point of sale. You need to be visible. You shouldn’t look to expand faster than the rate at which you should actually be expanding. With More, we expanded rapidly and realised we had over expanded. We then saw that consumers didn’t only want low price but also wanted quality. We opened ‘Quality First’ in Chennai and it became a large winner for us in our More stores.”

Nedungadi reiterated Kataria’s point of having influencers on your side.

  

Focus on the current consumer

Shantanu Bhanja, vice president – marketing, Hindustan Times Media, joined Kataria in protest against Maurice’s view on Indian companies and them lagging their Western counterparts on branding.

Bhanja went on to explain how it is imperative for marketers to follow the four C’s (consumer, communication, capability and company) during a slowdown.

He spoke about the importance of the current consumer for marketers. “The procedure to find new customers is more complex than the one to retain old customers. This is the time you have to focus on your current consumers and give them reasons to consume your brand. You don’t need to find ways of being nice to buy, and it’s not a time to change your brand idea. You just have to make your brand accessible and by that I don’t mean you should be looking to reduce price. Dettol launched a high level handless dispenser, and commanded a premium, but it’s still managed to gain market share.”

  

Smarter and simpler strategies

Citi India’s CMO and head of customer franchise management Sanjiv Kapur wrapped up the session with his views on smarter strategies.

He said, “Consumers want a connect between channels. One channel should know what the other channel has communicated with the consumer. That’s why we launched  a service where we would use different mediums to communicate with our user every time he or she used our card. Also, channels should have a memory. For instance, if a user visits an ATM regularly and withdraws the same amount each time, he should get a prompt from the machine, whether he wants his regular transaction, and that saves time.”

“Also, we must recognise every touch point. The amount of time and effort undertaken for an advertisement is 100 times more than the time we take to design an experience. Great brands like Apple recognise that. Also, we must look to provide complete solutions in one channel; an example for this would be the Citi branch in Palladium (Lower Parel, Mumbai). Banks usually take 15 to 16 days to issue cards, but in that outlet, users can get a card in two hours, to avail benefits Citibank customers gain across outlets in the mall,” said Kapur.

Kapur urged marketers to be collaborative and simple. He then cited Apple’s example again for his last point: simplicity.

“When Steve Jobs returned to Apple, he cut their 50 product portfolio to a simple four product portfolio, and see the success. We, at Citi have followed a similar platform and now only offer seven products, across 40 outlets in the country, and we’re managing success. To put the number of outlets in perspective, ICICI has over 2,000, HDFC has around 2,500 and SBI has 10,000. We’re still competing with them because we’re deploying resources in a way where we’re showing a bigger scale than we actually have,” explained the CMO.