CII Marketing Summit 2013: ‘The next two decades will be about responsible marketing’ - R Gopalakrishnan

The 13th edition of the CII Marketing Summit kicked off on 27 November 2013, on the theme ‘Market beating performance in uncertain times’.

The two-day Summit saw Thomas Varghese, CEO, textile business, Aditya Birla Group, and chairman, CII National Committee on Marketing 2013-14, delivering the welcome and keynote address.

Varghese said, “The downturn may be severe but it’s not an uncommon phenomenon. It’s a battle for sure. To create momentum, marketers need to take demand from competitors. You need to build market share everyday and not once. Growth will be realised by leveraging platforms such as social media. Managing costs is another department marketers need to take care of. Top lines and bottom lines are always important, but they increase (in importance) during such times.”

‘Marketing’ and ‘golf lessons’

R Gopalakrishnan, director, Tata Sons, began his address in the inaugural session comparing marketing lessons for turbulent times to golf lessons. He quipped, “It is like going for a golf lesson, where you’re taught all the possible techniques. But once you take away your golf coach, the ball ends up at a totally different place.”

Dividing the eras of independent India into stages, the Tata Group director made the case for an ‘attitudinal shift’.

“The period in the ‘50s and ‘60s is something I call the period of ‘romantic socialists’. The period in the ‘70s can be labelled as ‘vengeful socialists’; the mindset of businesses was very government-centric. During these two eras, you would rather be dead than have mugshots appearing in media from an awards night. The ‘80s and ‘90s can be labelled as the painful, experimental, liberalisation and privatisation eras. Liberalisation was forced upon us at that time and that’s why it didn’t happen smoothly. The last decade can be labelled as the era of ‘reluctant marketing’. In the next 20 years, we’ll see something called ‘responsible marketing’, which means marketers will need to be customer and society-centric,” said Gopalakrishnan.

The New Delhi consensus

He then argued that the world could be following the ‘New Delhi consensus’ by 2015. He explained, “In 1989, the ‘Washington consensus’ was the only religion for economic development. Then in 2002, the ‘Beijing consensus’ proved that autocratic markets could work. Now, we are in search of a new consensus. By 2015, we may have a chance to launch the ‘New Delhi consensus’. ‘Society-centric’ is the buzz word around the world, but Indian organisations like Godrej and Tata have being doing this for years.”

Gopalakrishnan followed this by talking about three points that could help achieve the New Delhi consensus – experimentation, common sense and intuition.

He elaborated, “We live in an age where rational thinking is supreme. We think we’re rational, but we’re completely opposite of the term. Rationality is an illusion. When you need to be consumer-centric, you need to understand that consumers are irrational. Market research should be taken like antibiotics – only under guidance. Turbulence in the market is not new. Our great grandfathers have also experienced it.”

‘Effective’ vs ‘efficient’

Gopalakrishnan then differentiated between the terms effective and efficient. He said, “Effective and efficient aren’t the same thing. If you want to solve the Kashmir problem, you need to be effective and not efficient. In this VUCA world, you need to be effective more than efficient.”
The speaker then underlined the importance of values, and said, “There is a buzz that values can be left (out) and don’t work. But, I can affirm that values matter and one must not give up that attribute.”

Highlighting the importance of values in difficult times, Gopalakrishnan surmised that one must not look to suppress turbulence. He said, “There’s a tendency coming from our left brain that the moment you see turbulence, you try shutting it by suppressing it, that it is the efficient way of managing it. But if you see nature, it does not try to suppress it, but takes turbulence down in spirals. At the centre of the spiral there’s calm, even though there’s turbulence around it. So while we feel we’re in a turbulent situation, we should look forward to the calmness ahead, which comes from values.”

Cost efficiency, ROI on marketing

Adi Godrej, chairman, The Godrej Group, followed Gopalakrishnan. He stared his session by quoting Winston Churchill’s definition of capitalism: “The inherent vice of capitalism is the unequal sharing of blessings. The inherent virtue of socialism is the equal sharing of miseries.”

Rural rising

Referring to the slowdown in India’s GDP growth, he said, “A few years ago, we were celebrating a marketing miracle. It was more than nine per cent and hinting at reaching ten. Last year, the GDP growth reached five per cent and projections are coming down to four or five per cent. This is the lowest growth the country has seen in the last 34 quarters. But on the positive side, rural growth is increasing. Strong agricultural incomes see discretionary spending increasing in rural areas, which has in turn seen growth.”

Communicate value

He made the point that while cost efficiency and ROI on marketing expenditure come under scrutiny during bad times, they get ignored in good times.

“People should analyse this more during the good times. We look to average everything, but we should look to deaverage instead. These are the times when people look for options and look the most for value for money. So marketers should look to communicate value,” said Godrej.

The Godrej story, opportunity

Godrej then spoke about his Group’s plan drafted in 2011 to grow 10 times in 10 years. The target to grow by 26 per cent per year was backed by an integrated program across the group. Aamir Khan was appointed brand ambassador. With him not doing too many endorsements, the thought was that he could endorse all Godrej brands.

Pointing out that only three product categories that are fully penetrated in India (soaps, detergents and matchsticks), he surmised on the opportunity, and said, “A study showed that 600 million Indians use one product under the Godrej stable each day. But with only three categories fully penetrated in India, there’s still a lot of categories that require penetration.”