Pepsi Atom - Excess josh leads to Atomic fail!

There is something really-really abnormal going on with the marketing at Pepsico. After Pepsi MAX, they have yet again come up with a flop cola and with that endangering again the positioning of the mother brand. The marketing echelon at Pepsico have deemed Pepsi Atom as their second 'mainstream' cola. They claim that the product was INNOVATED (like we don't know whats a jaljeera) to suit the Indian palate. I discern a consumer research veering in a terribly wrong direction.
The Indian soft drink is a 14000 crore market. The cola segment is being dominated by Thums Up, gorging in approximately 15% market share since its inception. A brand so successful, so strong, that Coke(the owners Thums Up) had to make an exception in their global policies to accommodate Thums Up. The essence to successful branding is undoubtedly consistency. And Thums Up has "consistently" maintained its rough, rugged and brawny masculine positioning.
Now, this "second mainstream" cola is essentially being targeted at Thums Up, by titling it as the 'Josh Cola'. Its overtly visible that Pepsi has terribly underestimated the might of Thums Up's entrenched positioning. Thums Up has had the first mover advantage, it has been consistent, but more importantly it has been successful in garnering "acceptance". Any Cola which tries to challenge that massive positioning will have to struggle, struggle a lot! It would require each and every aspect of the offering to be in complete harmony with each other and sadly, Pepsi Atom does not stand a chance.
I did a survey as to how the people found the taste of Pepsi Atom. Well, its hopelessly pathetic! Many are giving a similar response that it tastes like some ayurvedic medicine, chyavanprash to be precise. So, on the product aspect the offering falls flat on its face. They should have conducted a better consumer research before wasting resources on this product. They claim it Indo-vation, innovation for India. Its very sad that even after spending two decades in India, the company could not understand the Indian psyche. Yes, Jaljeera is a traditional flavor enjoyed by Indians. But, the occasion, frequency and usage of jaljeera is entirely different from that of a Cola! just because masala flavored chips are a hit, you can't extrapolate the same to a cola.
Its often claimed that FMCG sales are driven by heavy marketing, promotion and branding. So, to push this flop product the marketers face a formidably daunting task. And what they have come up with, can in no way push this product for long. It may at max sell as an ephemeral fad because of Pepsi's brand power. The positioning is vague and struggles between brains of sprite and brawns of Thums Up. The company is trying to make this bunny of a product fight with a lion like Thums Up. Thums Up has India's biggest star power on its side, Salman Khan and Akshay Kumar. Why would the company chose a new comer, so new that he has only one movie that too not as a sole lead to his name, to compete with the star power of the big daddies of Bollywood. So, the promotion and branding is also nothing over a prosy mediocrity.
Overall its going to be a flop product combined with a flop branding which the company has deemed as its 'BIG' launch and have declared to spend heavily on distribution and marketing on this inconsistency. I can foresee some cash burning.
Feel free to express your opinion.
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Harley Davidson to open Its bike cafe in India. Interesting, but what is more interesting is that this will be Harley' first bike cafe anywhere in the world outside America. What intrigued me about this news was that why instead of all the other countries in the world Harley is opening such a store in India, which happens to be a market at a very nascent stage for Harley.

Then, I came across this news about Apple. Apple inc is all suit up to get aggressive with its operations in India. But this news was substantiated with explanations behind such a strategy employed by Apple.
Apple's existing markets, the "developed world" are now showing trends of saturation in growth, mostly attributed to the high penetration of smart phones in those markets. Thus Apple is now all geared up to charm the Indian populace. Its a commendable strategy, they have skimmed one market to its optimum potential, maintained buzz in the other markets and now armed with information about the consumer psyche of the partially tapped markets they are ready to waltz.

And this can be the very reason of Harley choosing India as a destination for its flagship cafes. Its developed markets are getting saturated and India with its lush, voluptuous  and ever growing upper middle class comprising of the youth segment with high disposable income is a lucrative and sexy market for Harley which(the market) happens to be virgin also.
Whats your opinion?
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Mahindra Martin Bond

Brand James Bond –1953, The World is shuddering with the brouhaha of Cold war and each super power is planning and executing its own strategy to take over the world. Concept of Agents, spies or sleuths though seems intriguing but not outlandishly uncanny, and, in this era of real life action, drama and uncertainty Ian Fleming gives birth (literally and figuratively) to James Bond through his short story series. Gadgets, glamour, girls and guts, the character has all the paraphernalia to charm the audience. This deadly combination further coalesced with mind boggling story line to create a franchise that has garnered over $ 5.6 billion till date. Agent 007 has become an awe inspiring phenomenon beyond generations, beyond actors and beyond time.

Aston Martin, A super car, a super brand, an icon. Former coolest brand of United Kingdom. James Bond’s super sexy car. Flaunting an amazing sporty track record the brand is known all over the world for its svelte looks, thunderous engine and brilliant engineering. A brand so unique that it doesn’t have a person as its brand ambassador, it has a phenomenon as one, James Bond himself. Any sports car can’t have a better ambassador than James Bond. Sexy, smart, witty, sophisticated and timeless. Both Aston Martin and James Bond complement each other’s imagery, a perfect match, a natural association that augments the personality of both the entities.

Enter Mahindra & Mahindra, a $ 15.4 billion Indian Multinational, known to the common Indian as an automobile and farm equipment’s company. In recent times the company has underwent drastic (on the positive side) branding changes to reflect the expanding umbrella of Mahindra and Mahindra in multiple sectors. Mahindra is veering in the direction to become a renowned global conglomerate.  The recent rebranding campaign which is a 360 degree consistent communication is ‘Mahindra Rise’.  It has been successful in effectively communicating the vision and aspiration of the organisation.  When it comes to the customers, the company has been undoubtedly successful in delivering its promises which has resulted in emboldened trust of the investors in the company.   

Now, ‘rumours’ are rife that Mahindra and Mahindra is leading in the race to acquire Aston Martin from The Investment Dar. Aston Martin, though a prestigious brand but has a very prosy ownership history, that too right from its inception and is presently squirming under financial pressure. Anyway, I will restrict to scope of this article to branding only.

If Mahindra and Mahindra acquires Aston Martin, then frankly speaking it is not going to effect the consumers, of both Aston Martin and Mahindra and Mahindra, directly. I would draw a direct analogy- JLR’s acquisition by Tata Motors. Tata adopted the right strategy of keeping both the operations and communications of JLR individually intact. The JLR customers are getting all the value for which they buy the brand, though the delivery has been assured through Tata’s financial support. The brand has been now successfully resuscitated and is even bringing fortunes for TML. But has it affected the image of Tata Motors passenger vehicle segment? No. It is still the good old taxi brand. Are the consumers bothered that Tata has acquired JLR so let’s buy Tata cars? No. Though, the investors are very happy, the acquisition has been financially very profitable and declared a success. So, when it comes for an investor to invest in brand Tata Motors, has it helped? Yes. Similarly, M&M is definitely not going to rebrand Aston Martin as M&M Aston Martin post its acquisition, it will only affect the operational aspects of the Aston Martin and not the branding aspects. And how will it affect M&M? Obvious results- M&M gets a luxury brand in its kitty, it gets to expand its global footprint and becomes a better global brand with lucrative investment opportunities for the investors.

So, there lies absolutely no reason for James Bond to be bothered. Regarding the acquisition there is going to be no branding changes for both Aston Martin and Mahindra and Mahindra in the consumer domain and neither are there going to be any perceptual changes.

Sahara Q Shop : a risky proposition

Recently, Sahara has rolled out and executed its plan for foray into the FMCG and durables retail sector, though not through the traditional route but rather through an "innovative" channel. The innovation is that Sahara will be employing its existing 6 lakh odd strength of sales force, so far selling financial products, to sell the Sahara Q shop's offerings also. The company is planning to invest 3000 crore rupees to entrench its presence into the sector. I did my analyses of the concept and will present it here-

Lets have a look at the FMCG and retail industries. The Retail sector is India is currently being valued at $350 billion and has been projected to reach to $850 billion by 2020. The Indian FMCG sector on the other hand stands today at $24 billion and has been projected to grow to about $73 billion by 2020.( Still wondering why the international tier 1,2 and 3 companies are leering at India? ) But, Sahara will be following a direct selling model of private label brands (http://www.businessdictionary.com/definition/private-label.html), somewhat similar to Amway and Tupperware. The size of this sector ie the direct selling one was $ .957 billion in 2011, it is growing at a rapid pace of 20% CAGR and is projected to touch $1.97 billion in revenues by 2015. Amway is the protagonist of this model in the Indian story with a coveted market share of 45%.

Let us analyze the private label direct selling model

Bargaining power of suppliers- Low, as most of the times the companies own the value chain.

Bargaining power of the customers - High, since the customers can chose from a plethora of products available in the alternate channels.

Threat of new entrant- Moderate, As the investments required for the entry are not that huge, yet not many players have been seduced by this sector.

Threat of Substitute product- High, local grocery, department stores, modern trade, e-tail etc

Industry Rivalry- Low, not many players under operation and those are active are active in different segments.

 Now, let us have a look at Sahara's plans-

• Sahara Entering the sector by investing Rs. 3000 crores

• Products will be delivered through direct to home mode.

• Utilizing network of existing 6 lakh personnel selling Sahara financial products to over 6.5 crore customers

• 73 categories of products.

• Overall Category growing at a rate of 20% per year.

• Initial phase of launch will cover 60 towns across UP, UK, Bihar, Rajasthan and Jharkhand.

• Plans to launch retail outlets in 998 towns by march 2013.

• Massive back-end support structure, which would eventually comprise 200-300 contract manufacturers and packers, 305 warehouses ,encompass 10 million sq ft of space and more than 25,000 various types of distribution vehicles

• Marketing campaign-  Milavat se Jung

A SWOT analyses of the proposition

STRENGTH 

Existing sales force network with customer contacts.
Control over value chain with back-end support structure
Unique Direct to home model.
First mover advantage

 WEAKNESS

  Low variety
  Limited categories.
  Demands change in consumer purchasing behavior.
  No shopping experience.
  Sahara’s Lack of experience in the sector.

OPPORTUNITY 

Delivering the promised unadulterated quality proposition.
Portfolio extension.
Increasing preference for value for money private labels.

 THREAT

       

       Rising modern retail with plethora of offerings.

       Kirana stores can also do home delivery.

       Due to a strong umbrella branding, unsatisfactory quality in any one category can affect the perception for other categories also.

I conducted a short survey ( Wish to express my gratitude towards the respondents)

https://docs.google.com/spreadsheet/viewform?formkey=dGFSbVdhaUVmZUN5SGhLQVZYY2JWQnc6MQ#gid=0

The results which I got are as follows-

1, 42 % of the women are dissatisfied with the variety offered at the nearby kirana store.

2. 67% of the women said that their local kirana store offers free home delivery

3. 62,5 % of the women trusted the quality of the staples being offered by the local kirana.

4. 75% of the women trusted the quality at the supermarkets/modern retail.

5. 71% perceived better value with shopping at the super market

6. 16% of the women preferred kirana store as their shopping destination , 42% preferred supermarket as theirs and rest of the 42% were indifferent.

Now, Consider the following matrix

Thus,

So, for sahara Q shop to be successful the following equation must be satisfied

And,

• With such Stiff competition in the FMCG and retail, how will the Q-shop manage the margins?
• With already a limited variety, Q-shop needs a very strong and responsive supply chain.
• To convince the customers about the superior quality of Q-Shop products, apart from ATL promotion they have to give a very thorough training to the sales personnel.
• They have to ensure that a system to cope up with copy cats, the problem of ‘fly by night’ operators. This model is much more susceptible to negative publicity than others.
• With ongoing negative publicity and caution issued by SEBI to investors, how is Sahara planning to handle its PR?

Finally, According to my analysis, the road ahead seems very difficult for the Sahara Q-shop. I wish them good luck.  In this battle whoever loses, the consumer shall win.

Thank You

Your opinions are most welcome.

Social media marketing, the ideal way

Social media or digital media is a buzz word these days. The amount of time spent by people on social media today is what makes this platform so attractive. Moreover the media also provides the marketers the tools to refine their message towards their target customer group on the bases of various segmentation combinations available like geography and demography. Further, this media has the power to convey message on the basis of psychographic segmentation as well like for example in FB there are options present were you can select target groups based on their interests.
But the conscious and sub-conscious behavior of people on the social media is different as compared to the traditional media. Thus the marketers need to tailor their approach accordingly. Sadly, they are using the same old techniques on social media as well. Many  just post graphics of their products and services or they will put their usual videos. But social media is way beyond that, it proactively demands engagement and without it the life of the message will stay ephemeral and the impact ineffective. The medium is tremendously powerful and if the marketers fail to use it then it is their fault not the limitation of the medium.
I have also liked many pages on the Facebook, one of them being Nokia. The way this page has been engaging the users is really impressive. Check this one out-

This message apart from getting over 12000 likes got over 3000 shares also. Now, this is the way one creates engagement on this platform. Use the trends of the media, the trend which are created by the users themselves and thus they relate to it better and in turn relate to the brand also. Communication comprises not only of the message but the medium as well and until and unless the message is transferred in a particular medium according to the way demanded by it effective communication will not happen. Moreover, considering the fact that there is more clutter on the social media this becomes extremely important.
Soliciting your opinion.
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Nazrana of Rio Tinto

Rio Tinto, a river in Spain and a British-Australian mining conglomerate. It captured my attention when I read this news 'Rio Tinto eyes marriage gifting market in India'.

http://articles.economictimes.indiatimes.com/2012-09-19/news/33952516_1_bunder-project-rio-tinto-india-diamond-jewellery


First of all I did not know that Rio Tinto was into Diamond business also. Secondly, Nazrana is being owned by Rio Tinto. It is intrigueing to see how companies leverage upon their core competancies and diversify into attractive businesses. Daimonds!

Another observation, the company wants to focus only on its core competancy and that is mining. If you read the article whose link I have posted above then Mr.Merchant has made the statement that they do not want to go into retailing, which is outside the firm's core competancy of mining. Company is soliciting retail partnerships rather than forward integration.
Though, the Indian government allows 100% FDI in gems and jwellery and 51% is now also allowed in its retail, but still the company wants to take the supplier and branding only route rather than establishing its own retail outlets.
I can't comment on whether this decision is good or not good because it depends on the culture of the company and how they percieve entering into retail as digressing from their core competancy.

 I wish the company my best wishes.

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Axe Soap

Axe, the Unilever's manly brand has recently forayed into soap bars also. With that now Unilever has its soap offerings in almost all the regular categories with Lifebuoy, Lux, Hamam, Dove, Pears and Liril 2000.

With Axe soap bar Unilever is catering to the male segment which was till this point vacant after the rebranding of Lifebuoy from a manly soap to a family oriented one.

The soap can be considered premium offering as it has been priced at 35 Rs. in India. The positioning is still the same, with a picture at the back of the packaging showing a guy charming the chick after using the soap bar.

The product has pretty high chances of acceptance, i saw quite a few men checking the soap out in the Magson's shopping mall, Goa. Though, they eventually did not buy it, may be because of its price. 

If the soap becomes a hit, then it can result into a number of Me2 products. The first of them can be Set Wet, which has a similar positioning. Set wet is from the house of Paras Pharma, which has been recently completely acquired by Marico from Rekitt Benkiser. And with the set wet soap Marico can foray into soaps also.

Coming back to the Axe Soap. Right now there is no such ATL promotion. There is no mention of the soap bar in the company's website also. May be they are doing a pilot run before scaling up, which is very easy for Unilever considering their already available required resources to do such thing with any new offering in the category.

My good wishes with the company.