Saturday, November 24, 2012

New ways to look at old Retail

Retail Branding for India

By Harish Bijoor

My seminal contribution to the subject of branding is a simple one. A definition for a start. A definition I have been defending, traveling to the university towns of the world at large, debating, fighting and holding firm for the last eleven years.
My definition of a brand is a simple one.  The brand is a thought. A thought that lives in people’s minds. To that extent, every dominant thought in your mind is a brand. The thought of your mom therefore fights for mind-share with the thought of your wife, just as the thought of your wife fights for mind-share and top of mind status with that of your brand new Patek Phillipe you picked up in Zurich last week.

Brands live and thrive in mind-space. The mind-space of people. Never mind whether they are your consumers or not, they know your brand. The brand is therefore a thought. A powerful thought that lives in people’s minds.

Let me leave the definition there for now, planted firmly in your mind. It is indeed the start-point of understanding branding in retail.
This therefore is the start to understanding the brand. The brand is really not a promise alone. The brand is much more. A dominant thought!

My research in the Indian sub-continent, large parts of SE Asia, small sets of cities and towns in Continental Europe, and again sprinklings of small towns in North and South America, indicate a confusion and lack of understanding of the retail brand at large in several markets. And that is going to be the confusion I am attempting to clear in this piece.

Branding is a discipline on its own. It is all about the brand, collective sets of consumers, image, positioning of this image in the minds of these consumers, and creating a positive impulse for the brand at large.

Retail on the other hand, is something different, as all of us know it to be. It is that important front-face point. It is that point where the consumer actually meets the brand on the floor of the shop. It is that important meeting point. It is the point of action. It is the point of purchase.

The point of purchase today is the point of advertising, the point of marketing, the point of selling, the point of market research and more. The Point of purchase is therefore the point of everything.

While retail remains the art, science and philosophy of managing the consumer at the Point of purchase (which is the point of retail), branding remains a philosophy, art and science (in that order) of managing the image, creating the awareness, stoking the interest in the brand and leading the desire-stoked consumer to the point of retail. The two are therefore umbilical in connect. However, the important point to remember is that these two sciences of branding and retail are separate subjects in their own merit.  Combining the two to arrive at the subject of “retail branding” is possibly the most simplistic sin committed by a large many. The two are different sciences.

Therefore, note the point. The branding expert you got into your retail brand from that big FMCG corporate entity that has twenty brands with near billion dollar revenues, just did not seem to fit right. Retail branding is a different science altogether. While branding is about aggregation, retail is about disaggregation. While branding is about coagulation of intent, retail is about dissipation of intent. Branding is 1: Many. Retail is 1:1. And there lies the seminal difference. A difference few retail players recognize in their choice of people to head the discipline of retail branding.

Therefore, the mistakes get made. And the mistakes are many. You look around and see retail brands being promoted and advertised about just as toothpaste would be. The focus is on the brand name. The focus is on creating awareness, and possibly interest. The focus is on getting the largest numbers of people to look at your retail brand offering and see its merits in a rather aggregated “FMCG-kind “ of manner. The lure is the brand name, and the bait is the offer of 500gm sugar on every 5 panties you buy even!

What should the branding strategy of the retail brand be then in the Indian context? How should it be different?

Our research across 103 retail brands across the markets of India, SE Asia, UK, Hong Kong and the U. S. indicate many new ways of handling the retail brand to commercial efficacy and profitability levels. Every one of these ways is in direct contrast to the way a typical FMCG or durable brand is handled.

Here is a quick and ready peek into just one out of 32 of our research diagnostics pointers, converted into action points for the retail brand manager.

Nugget 1 of 32 then:
              Gyan: Never manage your retail brand offering as one.
Instead. Manage it as what it is. Many.

Mistake: Most retail brand owners tend to start small. Every Big Bazaar was once a small pilot offering. And every Big Bazaar dreams big.

Take Starbucks. The first outlet is just about announced to be launched at Horniman Circle in Mumbai, even as I write this. Starbucks will want to be one for a start, and many sooner than later. There is a hurry in retail roll out.  That’s normal and part of standard operating norm of a retail enterprise. But this hurry needs to be managed with care.

When your retail offering is one outlet, you nurture it with care. Local care. You customize your every offering, tailored to your local customer. You analyze your walk-ins. You interact with them carefully. You build your stock plan accordingly. You alter your shop layout accordingly. You tailor-make your customer service norms to need. You promote in the local hinterland of your outlet. You reach out to your potential customer 1: 1. You do everything local. You do everything tailored to the hinterland.

And then you open your second store. You open it basis your learning of Store 1. You are aggressive with your plans. Less tentative and more aggressive. Your learning at Store 1 has made you more solid.  You roll out. You meet with early success. You imagine your model is on the roll. You do not discount the fact that you just might be plucking the low-hanging fruit of opportunity in the new hinterland. You don’t want to get granular with the data.  Remember, retail brands do not have the time to sit back and think in India. Everyone is on a roller coaster. The deadlines are tough and the stock-inventories sourced and piled up by you need larger front-face locations in terms of numbers, to be able to be monetized. And this needs to be done quick.

And then, excited by the success of Store 2 in the new hinterland, you imagine your model is ready for rollout. You open your next ten stores in a hurry. And this is where you slip. This is where you roll out with the mindset of a big brand. You really use the mindset of an FMCG player out here. You imagine the brand is one. You imagine you have tested the offering as a pilot. You imagine your early pressure-test of the brand offering as a go-ahead for your larger rollout.

You then go out there and achieve scale. This scale is good for the back-end. It achieves supply chain efficiencies. It achieves quick windows that will liquidate held up inventories that were procured in larger numbers to get the best price advantage. Scale is the language of the retailer on the rampage.

Scale is good and scale is bad. The moment you achieve scale, you start behaving with the mindset of a large player. A large player, who primarily aggregates rather than disaggregates. It almost seems as if the small retail enterprise was waiting and fantasizing for this point of time. This is the time you let go and become the ‘big brand manager’ with the ‘big brand mindset’. In many ways, these are easier days. These are days when you can afford to say that your small pilot retail outlet is a big brand. These are days when you think big and aggregate. These are also days when you start advertising. You have scale on your side, and the effort is to build the big brand image in the minds of potential customers who will walk in.

The morph is now complete. You were once a small retail play, with efficiencies of customer management that were 1:1. Today, you are a big brand with efficiencies of scale on your side.  Today you are 1: Many. 

In my rude manner of writing, yesterday you were a retailer. Today you are a brand. Sadly, the retail-brand is really more about being a “retailer” than being a “brand”. My research numbers indicate success scores that are in the region of 92-97 percentile points when you manage a retail brand as small retail, rather than the score of 39-46 percentile points when you manage your retail outlet as a mega brand that is advertised. Advertising is a crutch. It is easy, outsourced, difficult to measure efficacy, and macro in its approach. And you get used to it. So used to it, that you think little else.

In many ways, the moment you advertise, you have grown up. You are outsourcing the micro-bits of hard work that helped create your customer profile for your Store 1, to advertising. You hope advertising will bring in customers.  You hope, you will never have to manage customers as intrusively as you had to when you just had one store.

Small is therefore beautiful in my model of retail-branding play for India. The moment you leave the mindset in retail-branding that says loud and clear through your actions that you are small and cater to small sets of customers isolated in small little islands that surround a hinterland of 1.6 Kms at maximum, you have lost your small-is-beautiful business mindset. And this in many ways is the beginning of the end of your retail-rampage in India for sure.

Retail outlets that have applied my basic evangelism of the small-is-beautiful thought pattern, even when they have grown in numbers, size and turnover, have had a better success score that rattles the 96 plus percentile number.

The point is simple. Start small in retail. Learn small in retail. Stay micro-oriented. Don’t bite into the temptation of adopting knowledge from the FMCG sector. Sack the guy you got from there. Stay focused on the constituency of 1:1. Stay local. Don’t advertise. Retail brands just cannot afford to advertise really. You must not load advertising cost onto the consumer.  Even as you expand and grow into the 1600 outlet league, manage every store as a store. Never ever aggregate the brand label as one. Manage the local hinterland.

Every Café and Super-store must have a Hinterland Manager. His/her basic role must be to manage the customers in a hinterland area of 1.6 Km in India, 0.7 Km in UK, and a very precise 1.1 km radius in Zurich. This Hinterland Manager is really the most important part of your retail-brand management toolkit. Not the least important as some would see it.

The Store specific Hinterland manager is the most vital part of the store. He looks after the store as a local shopkeeper would. He does not get besotted with the bigger picture, as he does get passionate about the small picture.  He costs little.  He brings customers in.

My research indicates a weightage of store revenue returns calculated and accrued to levels across types of individual Store managers as follows:

Chain Super-store Model

General Manager: 11
Merchandising Manager:  7
Cashier: 4
Sales: 14
Receiving: 3
Loss prevention: 1
Visual displays: 5
PR: 6
Promotions: 10
The proposed Hinterland Manager: 39

Total: 100

Fine Coffee Café Model

Store Manager: 31
Barista: 14
Shift supervisors: 4
The proposed Hinterland Manager: 51

Total: 100

Simple point. Morph your retail business to manage it as a retail business. Manage it less as a brand and more as a store. Touché!

Basis of Gyan
The above Nugget 1 is basis an active modeling study done across markets of India, Hong-Kong, UK, Dubai, Switzerland, Brazil and the USA. Sample size covered: Chain super-stores: 28 and Fine coffee Cafes: 6.

This study was conducted over a period of 30 months, concluding September 2012.

Harish Bijoor


Monday, July 30, 2012

Why I am India Positive.....

5 Reasons I am positive about India and Bangalore

By Harish Bijoor

The real-estate market of any city is a sub-set of the environment in the State it belongs to. And that is a sub-set of the country and its many policies, progressive or otherwise. Add to it the fact that the world is for sure a connected place today, and therefore there is a bigger environment that governs real-estate prices and practice, and that is the environment across the world at large.

Real estate is however all about geography that is real. It is about physical spaces that are about land, buildings, gated communities and more. To that extent, it is a physicality. A physicality that is very dependent more on the local than the global. To that extent, while the stock market of a country is all about being umbilically linked to the sneezes and joys of the world at large, the physical real-estate market is that much more local than global. And thankfully so.

In the world of real-estate, the further you move away in concentric circles from the local to the global, factors that affect the price point of real-estate get that much more insulated from the factors that surround. To that extent, the point I am making is a simple one. When you look at real estate, don’t fret and fume as to what is happening in Greece. Don’t worry that Nicolas Sarkozy has been replaced by Francois Hollande. Just don’t worry that you will not see Carla-Bruni Sarkozy that much in the news anymore. Just worry more about factors that are immediate and adjunct to the area of your investment. If you are planning an investment in Bangalore, worry more about what is happening to the governance structure in the real estate market, worry about jobs in the eco-system that throws up investors in the Bangalore real-estate market, worry about laws and rules that are in force and ones that will be enforced later than sooner. But worry about nothing more than that.

5 reasons why I am excited about Bangalore and India then, in that order:

1.     The aggressively young population

Bangalore boasts of a young population. While 54% of the population of the country is below the age of 25, Bangalore boasts of 63.6% below the age of 25.  A younger city means a hungry city. A city hungry for achievement, hungry for jobs, and most certainly hungry enough to invest in land and more. This young profile of the city is un-enviable. The only other city that comes close is Pune on this count. Young cities are hungry cities and hungry cities are investment friendly cities.

The downside of a young city is the fact that pressures to perform abound that much more in younger cities. Younger cities are high-tensile cities. No wonder then that Bangalore and Pune have emerged to be the suicide capitals of India as well. Sad fact.

2.     Spends and patterns of splurge in the TOP and MOP

The second reason why cities such as Bangalore are exciting places for the real-estate market for first buys, re-sales and repeat buys, is the fact that the splurge quotient of cities such as Bangalore is very high. The city is a polemical factoid. While Bangalore boasts of  10,600  Dollar millionaires at one end, at the other end, it also hosts large populaces of those living on the fringe of a hand-to-mouth existence. The real-estate market, sadly, depends on what the Top-of-pyramid (TOP) and Middle-of-pyramid (MOP) folk have to contribute to the kitty.

When you look at the spend patterns of the TOP and MOP profile, one witnesses no gloom at all. The splurge quotient is high on products and services alike. Super-market carts are still laden full with products that do not necessarily represent the best value-buys. The number of spas in Bangalore has grown from a measly 6 in 2001 to 121 in 2012. The number of beauty parlors has grown from a mere 107 in 2001 to 1220 in 2012. I do not have a comparative number for restaurants, but if you just look around, you don’t need numbers to tell you the story.

And every one of them is raking in the ‘moolah’. The point is a simple one. Never mind the fact that Greece is in trouble. Never mind that Europe is in shambles. Never mind that the Japanese economy is slated to de-grow at 0.6% p.a, in GDP terms. Just never mind. Look around and you will sniff prosperity and spends in your local TOP and MOP markets. Sadly or happily, the real estate market depends on its future on this market.

3.     The eastern investment mindset, and the shift from metal to land

This is a quick and happy one. Indians at large are very highly investment geared and investment oriented. The old mindset of investment was gold. This has held families in good stead over the years, particularly with gold prices ruling at an all time high as of today. This investment mindset has gradually shifted in the country from gold to land and dwelling units. The first things everyone wants to do, even before buying a Life cover in an Insurance policy, is to own a house or a piece of land. This has spurred and will continue to spur demand. Real-estate investment apathy has not set in as yet. It looks far way for now.

4.     The poised Next-gen ahead

The next generation is a very highly educated generation. Parents of the current generation have spent their lives working hard to educate their children and get them the best in terms of a qualification to earn more than they have earned. This is a good sign for the economy at large. This means the children of tomorrow will earn higher multiples than their parents did, net of inflation. This means there will be more money to invest. This is a trend that is quite unlike what we see in markets of the United States, where new generations are lesser equipped at large in terms of qualification and earning potential.

5.     Bangalore as a magnet city

The city despite all the ills we bemoan, is still a magnet city. We host mixed nationalities. We remain a secular city with secular intent. We are largely peaceful. We seldom fight. We might watch porn in the assembly, we might huddle our MLAs time and again in close-by resorts, we might clamor for free IPL tickets, but essentially we are a nice people living in a nice city. The city will still remain a magnet city. And that’s a big one for real-estate investments.

Harish Bijoor is a brand-strategy specialist and CEO, Harish Bijoor Consults Inc.
Follow him on @harishbijoor

Saturday, July 21, 2012

Modern retail and Shopper Marketing

Modern retail Ver. 2.0: Shopper marketing!

By Harish BIjoor

Shopper marketing is possibly the most under-explored, and for sure the most under-exploited science of them all. Shopper Marketing is therefore the most efficient of them all tools that lie out there in the open market place for retailers to grab and run with.
The story of retail is an interesting one.  Since retail is the oldest professions of them all,  every retailer stepping into the terrain imagines it to be kid-play. Choose a location, set up a store, stock it well, brand the store, advertise, and wait for your customers to walk in and pluck inventory off the shelves. And you are running to the bank, laughing all the way!

Wish that were true. The cruel fact is that it is not. Modern retail of both the big and small kind is way different, and way more difficult than all that. Don’t we know by now?

In the old days, Shopper Marketing was not even a subject to bother about. The terminology was yet to be invented and made ubiquitous. And "old days" was just 5 years ago!
Those were the days modern retailers were excited about plucking the low-hanging fruit of opportunity in the sector. The subject of retail had a centricity of approach that was entirely different. The approach was clearly one where you focused on back-end efficiency. This was really Modern retail 1.0 where you worked out great deals with suppliers, you worked out pack-size options that you were going to stock, you worked out shelf-stocking norms, and you were ready.

Modern Retail 1.1 was all about location. You took the next logical step of scouting out a location that was killer in all respects.  You did a quick 'thingie' with the demographics of the locality, local competition that was vulnerable, and if you were a wee bit savvier, you did a quick one on the psychographics of the folks who lived in that location. And you were ready. More or less. And most of the time, the Mall developer did all this home-work for you. All you needed to do was walk in with your ‘set-it-up-in-twenty-days’ store.

Version 1.2 of Modern Retail started depending on unique products your Modern Retail store could offer. Literally every super-market in the hinterland was offering the very same brands. Every super-market literally started looking like one another, except for the brand-name at the entrance and the ownership certificate you proudly had to display within the outlet at a prominent place for the Municipal authorities and the Shops and Establishments inspectors, and twenty others of their ilk, to examine when they did their visits.

In came the dealers’ own brands (DOB’s) in this phase of the development of Modern Retail in India. Every retailer vied with one another to have different sets of exclusive designer labels within their store, just as the 'dal-cheeni-chawal-atta” retailer tried to set up his own low-end private label brand. This was the differentiation at play.

And then came version 1.3. This was the phase where advertising took charge. The 30-second commercial on television was the big one to go with.  The store had sorted out its back-end issues splendidly, the location had been laid out thoughtfully, the store had been designed to efficiency norms that were global, the private labels were all there, and business was still 'parri passu'. Time to re-invent then. Time to think of drawing in customers through mass media. Through discounts. Through deals. Through loyalty programs.

Version 1.3 became 'parri passu' a bit too soon. Every Tom, Dick and Harish retailer was doing the same thing all round. Everyone brought in advertising. Every piece of advertising started looking like the suitings’ ad of yore, where you could not distinguish one brand from another. Therefore, one chain helped another, and advertising of the 30-second type became a generic piece that worked for the category of Modern Retail, but did not quite do too much to the specific brand for sure.

Every retailer went a step further and offered the loyalty card. The loyalty card of one store became the disloyalty card of another. Loyalty degenerated to location loyalty rather than brand-loyalty, and stores bled on this count. Version 1.3 of Modern retail in many ways was totally experimentative, 'parri passu' and bled moneys that a retail outlet of any size and ownership pattern could ill-afford.

I do believe we are still going through this Version 1.3 of bleed-value. Modern retailers are all of a sudden realizing the true-blue merit of Shopper Marketing at last!  As the high-hanging fruit of opportunity is all getting plucked by the host of 214-plus modern format retailers in the country, it is time for the real action to start. This action is in the realm of Shopper Marketing.

Version 2.0 of Modern Retail in India is about to kick-off then. This time round it is all about the most important link in them all: the shopper. It is time for insight building exercises that take you into shopper homes as you do wardrobe studies that tell you the exact number of ‘undies’ with holes in them. The exact number of lucky garments in the wardrobe and equally unlucky ones. The ones that make you fail in exams and the one that makes it rain heavily when you wear them even!

The world of insight into the shopper is getting more and more defined. Out of the window goes the 30-second spot, and in comes a focus on understanding the shopper holistically. And having done just that, time to put together Shopper-insight-geared offerings. Offerings that make your Modern Format retail chain that much more edgy and that much more buzzy than the shop next door.
Over to Modern Retail Ver 2.0 then: Shopper marketing.
Harish Bijoor is a brand-strategy specialist & CEO, Harish Bijoor Consults Inc.,  a strategy-consulting practice with a presence in the markets of India, Hong-king, Dubai, UK and Turkey. @harishbijoor

Friday, May 04, 2012

Modern Retail and Integrity Branding

The Chicken and Egg of Retail

By Harish Bijoor

As we get excited with every data bit and byte that hits at us on the front of the Indian economy at large, and the emergence of modern retail as the ‘manna from heaven’ solution  that promises to tie up an efficient supply-chain that links the deprived back-end to the craving front end of Indian consumers on a consumption  spree, we forget something basic.

Yes, India is growing. Yes, the prognosis says that India will be a USD 7 Trillion economy by 2020. Yes, we will be the third largest economy after China(which will incidentally be at the USD 16 Trillion number in 2020) and the US(at USD 21 Trillion!)
And yes, the latest census proudly tells us that we are all of 1.21 Billion people now.  And yes, the spending power of the Indian is on the morph. But, as I have already said, we keep forgetting something basic.

The basic then: Indian retail is chasing the Western dream a bit too much by rote. If at all Indian retail needs to be relevant, original and innovative in terms of appeal to the Indian at large, we need to be different. Different on the one acid-test scale that every human being looks at the buying, selling and intermediation process at large. With Integrity.

In the several marketing summers I have lived, fought, sweated and thrived, there is one insight that has held me in good stead.  This is the insight of Integrity branding.

Integrity branding is all about saying the simple truths in your brand communication process. Stick to the tone and tenor of integrity and you can’t do no wrong!

Let me look at it in a manner of detailing the concept at hand. The point is simple. All consumers are essentially truth seeking animals. Yes, all of us lie in some small manner or the other. These are really the small lies that make the fabric of our modern day lives. Small lies that ward off the inconvenience of a lie-less society.

Despite all these small lies, we are essentially truth seeking as consumers. When you buy a toothpaste, you expect honesty out of the entire exercise. The consumer-brand interaction process is a relationship. A relationship quite like the many relationships we go through in our social lives.

When you get into a relationship with a member of the opposite sex, or let me be politically correct and say member of the same sex even, you expect just one primary thing out of the relationship. The truth. There is no relationship you get into expecting dishonesty and the lack of integrity.

Very simply put, consumers get into brand relationships based on the expectation of the truth. But does she get it? And how much of it? And how frequently so?

My belief is that the brand that offers the most of the truth most of the time in this continuous relationship is the one that succeeds. The brand that fails on this count is an utter failure right away, or on the path of a self-fulfilling prophesy of doom round the corner.

Let me illustrate this with an example. Let me choose my favorite gourmet table bird for this example, the chicken! Let me take three of them.

There are really three chickens in our marketing lives. And remember, all of us are marketing people, since there are only two kinds of people in the world. The “marketing person”, who markets to others. And the “marketed-to person” at the other end!

Imagine three chickens out there. Each of the chickens is a manufacturer and a marketer. Each of the chickens has done something they are very good at. Each has laid an egg. And each of the eggs looks alike.

Each of the marketer chickens takes a different path to market their respective eggs.

There is the first chicken, which I call the “Shy chicken”. This chicken looks at the egg it has laid and finds the product quality to be all of 100. It then stands up, looks at the target audience of potential consumers and whispers with a decibel of shout that is at best 2 on a scale of 100.

This chicken’s whisper is heard by very few of those in the target audience. Even those who hear of it, hear it as a faint whisper. The promise offered by the whisper is just 2 on a scale of 100. Those few who hear the whisper actually come to see the egg, lured often by the under-shout that creates quite a bit of mystery in the consumer at hand.

When the few consumers actually arrive to see the product, there is great joy. The consumer expectation of 2 is rewarded with a delivery of 100. The positive strokes offered in this purchase is +98. The negative of this approach of course is the fact that it scores very low on consumer awareness scores.

Look at the second chicken then. This is what I call the “honest chicken”. This chicken looks at the target audience and shouts out the product offer with a shout level of decibel 100. The shout quality is equal to that of product quality.

The pros of this approach is apparent. Awareness scores are good. Everyone has heard that the chicken has an egg to offer. But there is a problem here. Consumers do not necessarily respect honest chickens. When the consumer has heard the full story, he does not want to see the egg at all. There is just no mystery. Only a few arrive to see the egg, and these are the only ones who actually need an egg. And when they arrive, they expect 100 and get 100. No positive strokes and no negative. The potential of a buy is low as well.

The third chicken is waiting. This chicken finds the competition hot. This chicken gets onto the rooftop and shouts with a decibel value 400. The darned chicken has laid an egg but shouts as if it has laid an asteroid! The awareness scores are terrific. The entire town lands up to look at the phenomena. The expectation is 400. The delivery is 100. There is a negative stroke quotient of -300. And nobody buys!

All these three chickens and their respective approaches are out there for the marketer to choose from. Each of us makes this choice every living day. There are variations available in the gamut of 0-400 in terms of shout levels. Different marketers choose differently.

But guess what, the chicken that shouts with a decibel of 80 is the one that succeeds the most. Also, after 400 what? Back to a decibel of 2. In a market where everyone is shouting at 400, the one chicken which whispers the least is the one that is heard and trusted the most.

Think about it. Which chicken are you as a marketer? And which chicken are you as a working person? And which chicken are you as a person living in a family of your own?

The author is a brand-domain specialist and CEO, Harish Bijoor Consults Inc., a consulting practice with presence in the markets of Hong Kong, Dubai, UK and India.
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Sunday, April 29, 2012

Seven Key Contemporary Marketing Issues

The Brand Strategy Seven

By Harish Bijoor

In the beginning is the brand!  Let’s start with the brand then.

My definition of a brand: The brand is a thought. A thought that lives in people’s minds.  A simple thought that gets planted (either by intent or accident) in the mind of a person. This thought then has the ability to germinate and flourish in a person’s mind. It equally has the ability to decay and get relegated to the farthest recesses of the mind.

Brands that invest in keeping their “thought” alive, peppy, contemporary, relevant to the generation, original in impact and innovative in their offerings tend to thrive and do well. Those that don’t die and get pushed into the outer-most periphery of near-oblivion in the person’s mind. And remember, this is a “person” and not a “consumer” I am talking about. Brands live in people’s minds. And these people are not necessarily consumers, as yet.

Brands are about strategy. And not about the tactics that brand managers deploy every now and then, imagining themselves to be alive and contemporary. And strategy is reasonably long-term, durable and something that delivers perceptible business impact.

Now let me cut oblique brand-talk and come to the point. If there are 7 Marketing strategies that brands cannot afford to ignore today, what are they?

Here is my top 7 listing.

1)   The Enabling Lives Dictum:
Brands are meant to enrich the lives of people. Brands are meant to be solutions. Real solutions to real problems. The moment your brand is moving away from this dictum, it is time to re-orient your brand strategy. If your business owner is however inclined to go his way, time to call your friendly headhunter and re-orient your job-strategy instead.

Brands today are offering solutions that look like solutions, but really aren’t. Time to do an audit on your brand and see if what you are offering as a solution is really one. Is it something you would offer your ailing father as a solution? Is it something you would sell to someone who is investing his last buck onto it? Is it something you would sell to this innocent little girl who knows little?

Do the innocence check on your strategy. If you find yourself going berserk selling deodorant that looks like a chick-magnet or offering a television that offers to cure your Blood Pressure problem, time to re-orient strategy.

Brands at large have a tendency to get carried away by the creative. At times brands swim far away from the basic tone and tenor of their brand proposition statement. At times brands adopt the most desperate measure of saying things they really don’t mean and really don’t represent. Avoid this totally.

Brands are meant to enable lives positively. Not by deceit. Not by subterfuge. And most certainly not by clever lines that hide more than reveal.

The consumer is not an idiot. At the same time, the consumer is not as intelligent as most people imagine them to be. Successive small little doses of advertising hyperbole have made urban consumers develop thicker and thicker skins of understanding. Today, a lot goes, unless specifically pointed out to be a bit too far in its logic.  Brands need to understand this, and need to correct issues where they have gone a bit too far, and a bit too wrong.

There is a need to do a check on every brand that you manage and handle. Ask the simple question: does it enable lives? And am I communicating this fact adequately with enough integrity? Or have I gone a bit too far? Must I correct this as part of my overall brand strategy?

2)   The Inclusive versus Exclusive Dictum:
Brands are essentially meant to be inclusive entities that belong to and within society.  Some brands do not however consider themselves to belong to this mindset. Brands, by their very definition are meant to be exclusive statements flaunted by exclusive people.

This old definition and mindset of the brand at large needs to be challenged today. The rationale is a simple one. Society today is getting to be more and more inclusive. Everyone who lives in it is knitted together with one common purpose. Your maidservant is knitted to the purpose of your life, just as you are knitted to the purpose of your maidservant’s life.

Relationships in society have changed. The mindset of slave and master has changed, if you have not noticed it yet. You may not be in love with your maid, but when your maid is in trouble, you help. For whatever reason. Noble or ignoble returns-oriented reasons as well. And when you are in trouble, your maid stretches herself to help. At times with reasons more genuine than yours was!

In a society that is progressively more and more knitted together, brands cannot afford to be exclusive in their stances. Brands need to knit everyone’s purpose together. It is quite likely that your driver wears a Levi’s and is married to the brand, just as your wife is.  And if you check your driver’s 'loo', you are very likely to find the same tooth-paste you use, the same mouth-wash you rinse your mouth with, and the “same-to-same” sanitary napkin with the latest in absorption capacity (enough to soak up water from a full swimming pool even!) that you find in your bathroom cabinet.

The brand lines are blurring now. When consumption is becoming largely common, do a check on your brand if you are a bit too exclusive for the society in which you operate. If you are, time to change your strategy. Brands need to get off the “Exclusive” pedestal and get onto the “Inclusive” bandwagon out there. The Master and slave days are over. If you have not noticed that as yet!

3)   The Green Dictum:
The reigning color of the day is green. As more and more damage is done by brands to the society at large, green is getting that much more relevant. Consumers are just about sitting on the wall of an altogether embrace with the green ethos and story.

It will start first with categories that pollute the earth the most. It will start with cars at the highest common denominator end, just as it will start with detergents at the lowest common denominator end of the market. Green has a relevance to both categories. Consumers will start looking at cars that gobble up Carbon dioxide and sweat water vapor, just as they will look for detergents that enrich the water let-off instead of pollute the same.

A part of good and enduring brand marketing strategy for the future will need to incorporate within it the Green and eco-friendly story. Any brand that does not incorporate within its DNA the story of the good earth is skating on the thin ice of the future. The future is going to be kind to those that support the earth and its future, and completely unkind and cruel to those that don’t.

If you don’t have a green ethos in your brand, whether you are a retail brand or one packaged at the factory for end consumer consumption, you are a suspect brand of the future. Incorporating the green strategy in your brand is possibly the best thing to do in terms of future insulation. Those who start now have a leg-up to those who start later.

In this space, let’s accept one thing, brands just don’t have a choice. Do it now in-expensively, if you don’t want to do it five years hence, very expensively.

4)   The Social Grain Dictum:
If society wants to eat less of you, are you pushing more of you? If society is getting sicker and sicker with more of you in their lives, are you promoting more and more of you? Time to do a check on this in your brand marketing strategy.

Brands need to do a reality check on their social-grain status. Brands that wish to remain sensitive need to swim with society and not against it. You cannot be a Salmon out here, swimming against the tide. Swimming up-stream is fine for the tasty pink-flesh, but not fine for your brand.

If society wants to drink less alcohol, and you are an alcohol brand, what are you doing about it? If society wants to smoke less of your tobacco-stick, what are you doing about it? What are your social-grain brand stickler points? Even as you promote your brand through the permission-marketing route, what are you doing to correct the in-equity that it is resulting into? Are you active in spreading a chain of your own de-addiction centers? Are you being even more pro-active than that? Are you promoting responsible-drinking norms amongst your target segment through mass-media advertising and PR campaigns that are real and solid, and not just skin-deep, showy and just enough to get good Press for your brand?

Check every negative action of yours with a counter-action that is positive. Check the weightage of both. Yes, you are a business, and you cannot match every action with an equal reaction. But are you at least an 80:20 brand in this space of correcting the social issue at had caused by your brand.

The Social Grain dictum I am championing here is not about the categories of liquor and tobacco alone. Think about it. Every category has a soft under-belly on this count. Even the most innocent-looking ones.

Let’s go down the pecking order of what I call the future “Social-ostracism categories”. Processed sugar? Brands that pack aspartame into them, including every Diet drink in the market? Butter? Ghee? Carbonated and high-sugar drinks of every type? Every burger and pizza in the market? Snack-foods of every kind?

The list can go on and on. Do a check on your brand’s social-ostracism index. If you are likely to figure somewhere on it, just put a flag in your strategy and correct it now.

5)   The Communication Sensitivity Dictum:
The consumer is getting more and more sensitive about the clutter of communication that is staring back at him and his family today. As the days go by, the word pollution is going to get a broader application in the world of advertising, branding, marketing and consumer life.

The consumer is going to discover “visual pollution” in the hoardings that stare back at him cluttering his life. In the old days he had the trees and the open sky to look at, and today it is just one hoarding leading to another seamlessly. The consumer is equally going to discover “aural pollution” on his television set and his radio in the car. Pollution is no longer going to be about the things that he is breathing in or what he is finding in his water sources. Instead, pollution is going to be about things he is going to perceive with his eyes and ears as well.

Add communication sensitivity to your brand marketing strategy. Do a check on how the consumer is viewing your effort today. Make those corrections and use it as an active part of your brand strategy. Don’t miss this one in a day and age when we are getting lost in the creative loop that seems to be just getting longer and longer. Let’s not hang ourselves on this one.

6)   The Health-intensive Dictum:
Health is a big concern. India is becoming the Diabetes capital of the world.   As prosperity indices increase, obesity is becoming a big issue. Hypertension is a day-to-day reality. As every life-style disease becomes a big issue in India, brands need to make a check on their health-quotient.

You may not want to promote your brand as a health food for now, but do a check to see if you are replacing cheaper un-healthier ingredients in your food today than you must. If you need to rectify this, do it. Brands that do injustice to consumer health, whether it is in foods and beverages or in auto or computers or telecom for that matter, just need to correct their stances. If radiation in telecom handsets is an issue, time to showcase it yourself as a telecom handset player n the Indian market, rather than ruin the lives of millions before anybody waking up. Or for that matter not waking up!

Incorporate the health dictum into your brand marketing strategy. You will not go wrong. And guess what, you will be able to go home to your family and get a nice night’s sleep. Guess what, you might dream a nice dream as well!
7)   The 1:1 Dictum:

Dictum seven then. This one is about getting personal with your consumer. This was something every brand did in the good old days.

The best way of selling a mobile-phone device is to sell it 1:1 sitting in front of the consumer. When this got difficult, marketing folk did group-selling sessions where you sold 1: Many. This was in person again, but 1 sales-person sold to 40 people in a room. Less efficient than “1:1”selling, but still efficient.

When “1: Many” got difficult, we took the route of getting behind a camera and recording a brand TVC and doing a “1: Very Many” selling mode. This works less.

In this day and age of extreme brand communication clutter, time to re-invent the good old way of “1:1” selling. Try and incorporate this in your brand marketing strategy. Looks difficult it the beginning for many a mass category like tea and toilet paper. Try it though for categories you can. See the results for yourself. You will be sold to it in no time.

An important part of brand marketing strategy is still the way you sell.  Don’t forget to include this nugget into your marketing plan. Bumper sticker then: In an era when everyone is selling “1:All”, the one who is selling “1:1” will reap the riches.

Harish Bijoor is a Brand-strategy specialist & CEO, Harish Bijoor Consults Inc.

Saturday, April 28, 2012

Marketing to the Bottom of the Pyramid in India

The Art, Science and Philosophy of Marketing to the BOP

By Harish Bijoor

The late Dr. C K Prahalad, in more ways than one, gave us the Pyramid once again. A Pyramid that is India. A pyramid that has small self-actualizing niches of the population at the top of the pyramid, large masses at the middle of the Pyramid and even larger impoverished, under-nourished and totally ignored populations at the Bottom of the pyramid in discussion.
The other thinker who gave us a pyramid all his own, Abraham Maslow was totally right in hindsight. Those at the top of the pyramid are really self-actualizing folk. Folk who think a lot more about the others than about themselves. In many ways this thinking class right atop the pyramid is the class that represents the thought leader paving the way for the India that is to be in 2020. This niche is however is not to be confused to the real India.
I read Dr. Prahalad’s picture of the pyramid that is India in tandem with the very notion of the “Next 2 Billion”(IFC). While the top 4 Billion population of the world are really the haves, the next 2 billion are the ones that don’t really have. The have-nots. The market is therefore right here with the have-nots. With the ones who sit at the bottom of the pyramid of every country there is. In the parts of the world still being defined as the “developing world”, the size of these have-nots at the bottom is really, really big, and in the case of the developed nations, the real worry is that the size of the niche at the bottom is really growing. Growing thanks due to the recession that hit the developed economies of the world not so long ago.
Sitting under my own Peepul tree, I come up with not one but two pyramids for India. When asked to describe India, I do not use Dr. Prahalad’s One Pyramid. I draw out two on my I-Pad. As an aside, India sure has moved in its symbolism of technology for the people: from the sanitary pad of the 1950’s to the I-Pad of 2010!
I draw two pyramids. One is a small. Another big. The bigger pyramid is three times the size of the smaller one. The big is RURAL and the small is URBAN. On each of these I draw three wedges as segments. The top of the pyramid, the middle and bottom. At the end of the exercise, when I put numbers in the tiers of people, the shocker really is that the size of the Top of the Pyramid in Rural is really 2.6 times the size of the Urban. And the size of the middle of the pyramid is just some 6 times that of the urban, just as the Bottom of the pyramid is just about 2.3 times that of urban.

The point then: BOP is a reality of both urban and rural markets. It really is a myth to look only at rural for the BOP manna that most marketers have rushed to address. There’s more to the concept of BOP than rural alone.
Having said and established that for a start, I do believe that the story of India Inclusive is really all about knitting the BOP into the mainstream that is India and Indian. Marketing to the BOP is both an art and a science. Along with that, and most importantly, its a philosophy. A philosophy that corporate organizations need to ingrain into their DNA.
The most important fact that needs to be bought into is the fact that marketing in the future is all about inclusive approaches and not the old exclusive approaches. In many ways, the concept of the brand and the very definition of brands swim against this new need. The brand in many ways is a premium. A premium that is extracted from the exclusive masses of its consumers. This notion needs to be re-jiggged now. The brand cannot be exclusive to its exclusive masses or niches. The brand needs to belong to all. And belong in an inclusive and all-encompassing manner for sure.
The key question then is whether marketing can change the world. And can marketing change India for a start?
I do believe it can. It can, provided we re-jig the way we look at markets and consumers at large. From the 47 and odd theories I have built in this realm over the last two decades, let me pick three key thoughts then, one each from the realm of the Art, the Science and the Philosophy that is marketing. Key thoughts that will help re-jig marketing at large, and help re-orient the way we want to open the can that is BOP and the can that is India Inclusive in its orientation.

1.    The Art of Marketing to the BOP: Gandhian Marketing versus marketing the “Honest Shirt” and the “Toothpaste with Oxygen” in it!
Brand India has seen two kinds of brands emerge over the decades that marketing has touched the nation and its produce. At one end is the brand that is today that of the Mahatma. The father of the nation, Mahatma Gandhi is the biggest and most recognized brand that represents India internally and overseas. Mahatma Gandhi has emerged to be the most durable brand of them all.

Gandhi-ji never needed to take a full-page ad in the papers saying “Gandhi Shining”. Brand Gandhi happened as a function of the hard and dedicated work he did at the grass-root that is really India. Every action of his that focused on upliftment of the under-privileged, and every icon he gave to India became a durable representation of this ethos. Whether it was Khadi, the Dandi Salt Yatra or non-violence as a means of protest, Gandhi-ji reigns as a thought, even today. Across the world. This was true-blue bottom-up branding. Branding basis hard work at the BOP.

The second and more common marketing format in India today is the format of Top-down marketing. This format is all about taking a shirt and making it honest and taking a television and making it healthy and of course taking the humble tooth-paste and adding Oxygen to it. And around all these offerings, advertising has added further allure. Top-down branding is a format that has touched every segment of the pyramid and still attempts to touch the BOP. Sadly, it does not work here. The BOP is the most intelligent and most untouched-by-hyperbole segment of the Indian economy. This cannot be taken for granted and played with.

If you need to succeed here, simply adopt the Bottom-up-branding ethos. Do a Gandhi on the market, and stop putting Oxygen in the toothpaste instead. The BOP disbelieves advertising fluff and fare more than the de-sensitized marketing-anaesthesiatiszed top of the pyramid market.

When brands finally get to think of  the BOP markets in both urban and rural, it is time to put together programs of what I call and practice as “Conscious De-branding”. A process where you sit and peel off the slick and the glib from your brand and advertising offering. Making the brand offering real. As real as the consumer.

2. The Science of Marketing to the BOP: Democratic Distribution systems versus the autocratic Top-down ones at play!
Distribution is a demon in India. Reaching masses of people who live across different terrain and at distances that are difficult to reach with consistency seems a big challenge even today.

The three tenets of a good distribution system are indeed the width of reach, the depth of reach in terms of product and service offerings and the consistency of reach, week after week, if not more frequently.

I do believe there are three types of consumers emerging in India today. The first is a consumer who buys products and services for self-use. For use by the self and family of 4.

The second type of consumer is the one who buys partly for self and partly to distribute. This consumer is 70 per cent consumer and 30 per-cent re-distributor. You find these mostly in the Tier-2 and Tier-3 towns of India, even today. They make a margin on what they sell and partly defray the costs of what they buy for themselves. These are savvy consumers and savvy business people as well in their own right.

The marketer needs to recognize this consumer and make offerings that are relevant, original and innovative.

The third type of consumer is the one that buys possibly 5% for himself and 95% acting as a re-distributor. I find these in the smallest of villages in India. The most efficient system of reaching out to the land that is India is really this. Millions of entrepreneur-distributors who make a living doing just this. This is a win-win for the marketer and consumer alike. A win-win combination that is totally under-leveraged as of today.

The future of cracking in to the pie that is BOP in both urban and rural is this. This is it!

3.    The Philosophy of Marketing to the BOP: Creeping Urbanization versus Creeping Ruralization!
Ever since independence, India has witnessed a creeping and crawling phase where masses of people have morphed from mindsets and consumption sets that were rural to mindsets, which are more aggressively urban. The marketer at large has been responsible for this. The movement that was a crawl became a literal gallop in the early and mid-eighties when Television knitted the nation as one, pumping urban imageries of the modern marketing man in India to rural audiences. Television and all the advertising it carried threw up and pushed down rural throats and stomachs and bladders the urban way of life. In more ways than one, India became an Instant urban society.

This I do believe is an un-doing. An un-doing that needs to be corrected. In many ways marketing is a hegemony in India. The urban-educated and privileged marketer markets to the rural person. Never mind that rural is three times bigger than urban. The imagery that consumers emote with in India today is the urban imagery.

Turn turtle this and emote with real India. Emote with the imagery that is rural. Put a program that is rural in your marketing mix. Go one step further and show your archetypical brand hero in your TV commercials to be the rural person. See what it does. I do believe India is ready to turn-turtle its marketing imagery. The BOP market will admire this. And will certainly reward this effort. With market share. And money. And more than that, consumer affection.

The road ahead for the Inclusive India agenda is an exciting one. Tread it with strategy.

The author is a brand-strategy specialist & CEO, Harish Bijoor Consults Inc., a strategy consulting firm with a presence in the markets of India, SE Asia, UK and Dubai.