Maggi Crisis - Will Marketers Win Again?

Maggi and the Lead Crisis seems to be going out-of-hand for Nestle. I have written earlier about Maggi and is one of my favourite examples to wake-up students in the class, so felt obliged to share my view on the crisis. I have few die-hard fans at home too…

Historically we have seen brands go this kind of challenge, once with the Cadbury's worms issue and the Pesticide Issues with the Colas drinks, and they have recovered fairly well from the crisis, so the same prognosis goes for Maggi too. But yes, a lot needs to be done before the recovery would happen. I am going a little ahead of time, as the worst of the crisis is yet to come, and that would happen over the next couple of months, with more reports coming in and the media having a gala time, debating the issue on the prime time :)

The reasons why I say that Maggi would make a come-back, (though in the process some other brands would be able to gain market-shares which they would have never dreamt earlier) is the loyalty it has developed over the years and the loyal Maggi eaters would eat it anyway, good or bad. The second reason is marketing, they have had very good marketing brains working for the brand and that has been the reason for its success and they would fall back on the same people to help them revive the brand. My guess is that the strategy would already be getting ready in the boardrooms and mid-night oil must have been burnt reading the experience of coke and Cadbury’s..

But interestingly one challenge which I see is winning back the “Mother", though most of the communications have mother at the centre, but she has not been very happy with serving Maggi to her children all along.  I overheard this conversation between a mother and her seven year old daughter, where the child was asking the mother about MSG and the problems with it, and the mother extended it to even pizzas saying that even they were not good. Over the years the typical mother has been grudgingly let the child eat the quota of Maggi without being able to do much, now here she sees a window of opportunity. She will try and use this crisis to wean the child away from Maggi. But my hunch is that the marketers will use more powerful tricks to win both of them back, for the child is the taste and mother the convenience…

I have used the word "Quota" in Maggi consciously, ideally it should be 'rationing' as the child is not allowed to eat Maggi whenever he or she wants....

New categories even in village haats

In the last decade we have seen many new categories capture the imagination of the Indian consumers Green Tea, Olive Oil, Oats....

The other day I saw an interesting product, stacked in a bag in a village haat ....

The category is Macaroni

Swach Bharat Challenge

Saw the poster being hung in one of the bigger railway stations and the photo should itself explain how difficult it would be to go beyond the poster, though I have seen some transformed stations too but then India is not a few stations...

Defying Conventional Logic : Media before Distribution

I have always believed that among the four Ps of marketing "Placement" is a unique challenge in India, and companies which have been able to crack it are the ones which have managed to succeed......

And the emphasis is also on how well one is able to align distribution with overall marketing strategy. Though seems very logical I will give an interesting question which confronts many marketing managers, Should media come before distribution, which means that should the Ads hit the TV first and then you go ahead and distribute your products. The conventional logic says that the distribution or placement has to happen before the media hits the TV, as you would not want consumers to go to the shop and ask for the product and the retailer says it is not available.

But there are a few companies which defy this logic like Darshan Patel,  of Vini Cosmetics, who made Fogg deodorant available after almost a month of Advertising on the TV. The retailers kept on asking for the product as people were coming and asking from them. The unfulfilled demand meant Fogg could afford to reduce the trade margins.

But can all companies do that , I think for most companies the conventional route is safer, and one should also have the confidence in your product adopt this strategy....

Ecommerce Revolution 3.0

There have been two phases of ecom revolution in India,

The first phase was ecom 1.0 the first time internet and ecommerce was started in the late 90's and early 2000 (at least in India), and they also very exciting days, lots of hype and recruitment happening. I also bought stuff online and experienced the revolution first hand as a consumer. As with many other new industries there was a bust (Dotcom Bust) and very few survived. The focus in those days was to get maximum eye balls, but how would one monetise them was never answered or rather questioned ………

We are in the second phase now, and as with the last time this phase is also very heady, deals and match-making happing between companies and consumers having a ball with deals and free deliveries and it seems that the party would never end. And guess what is the focus now, it is on transactions, al a the "Billion Day Sale” of flipkart or the snapdeals. There is a mad rush to get to the maximum transactions, again as earlier no one seems to be looking at anything beyond transactions. The snapdeal losses should help open our eyes....

I guess there would be ecom 3.0 which would happen where people would focus on profitable transactions, and that is when the industry would stabilise. I hope this would happen without a bust and companies like the Flipkart’s and the snapdeal’s would be the ones who would capitalise on the market which they have built, but then you never know if revolutions can happen without bloodshed.....

Interesting hoarding

Saw this interesting board in the market yesterday.

Bamboo Cluster Village - Assam

Recently had the chance to visit a village which was into production of products out of Bamboo. Each house was specializing in some product. One has to see the skill level to actually appreciate it. A few photos from the visit..

Entrance to the Village

Sofa Sets being made

Bangles being made

Smaller Stools

Finished Smaller Stools

Uber - throwing the Service Provider Away with the ....

I have been reading a lot of reactions on the banning of Uber in New Delhi after the unfortunate happening. I would agree that there would have been fault at Uber's end in verifying the Driver but does that mean that we will ban the service.

Let us come to the basic issue , why is suddenly that one finds these app based services becoming popular across cities in the country, first is the poor state in which our urban transport infrastructure is in. Second, is that the other formats of public transport like Auto or Cabs are very expensive and one has to rely on the whims and fancies of the drivers to reach your destination,. Anyone who has travelled in a Auto in Chennai or Bangalore will testify for that.

I was reading an article in the TOI in which the author lamented the fact that the incident had snatched away the sense of security which women use to have when one travelled through these app based services.

In terms of the verification process, we all know that how difficult it is to get a genuine verification from a authorities and the other way round too...

I think the solution does not lie is just banning these services but to reflect back on what processes can we have in place where the verification processes are more reliable and of course the overall safety levels improve....

Appropriate Hoarding in Temple Town of Puri

Interesting Hoarding on the Road

Forgotten Brands

It must be true for the other markets also, but I find this a little surprising when I see very good brands languishing in neglect in a market where there is a dearth of good brands. I saw one example yesterday in a shop and that triggered this post. The brand which I am talking about is catch, it use to a quite well-known brand a couple of decades back, but now I do not think many people would think of it is a strong brand. 

A more recent example is a brand in apparels - ColorPlus, it again use to a  very strong brand in cotton apparels , but now today I do not see it occupying the mindshare as it use to 10-12 years back.

One of the reasons is that these two brands were bought over by larger player like Raymonds bought Colour Plus, but then rather than leveraging the brands name , it has left to die, maybe some the internal dynamics of the organization would dictate that or the brand gets lost amidst  the numerous brands that the acquirer has.

The list of the forgotten brands is very long, Uncle Chips, Deccan Airways, Kelvinator...

Nokia will also join the list soon, at least in the mobiles....

Sachets and their role in increasing category penetration

Sachets are perhaps the most important innovation to happen in the Indian market in the recent times. They say that litmus test for a real good innovation is that after it is executed it seems very simple and apparent, that is true for the use of sachets in India. Another reason could be the fact that we are naturally used to buying in smaller quantities be it buying cigarettes in sticks, oil in loose , one just needs to go to the hinter lands to see what can be sold in smaller quantities.

The overall role of small packs in increasing penetration of categories like shampoos in rural India is an old story.

A few days back saw the small packs of Hershey's Syrup. My guess is that this is an adaptation for the Indian market. Will surely promote the trial of the product especially in India where familiarity with the category is low.

Nokia feeling Nostalgic

Yesterday was the last day for the Nokia factory in Chennai and when I saw the article in et and the models shown in it ...

The significance of the factory in terms of the output is not known to many of us

Can toothbrushes be further Differentiated?

Whenever I have think of tooth brushes, the first image which come to my mind is that of the toothbrush salesman moving from one shop to the other walking with bundles of toothbrushes.....

And feel that all that can be differentiated in a toothbrush has been done, no further ways to make your toothbrush different from the other..

But then time and again I see examples which remind me that a marketer can find ways and means of differentiating and continue doing it

The zigzag bristles, additional tongue cleaner and so on....are the usual ones

The most interesting one which I found was the idea of putting an indicator in Oral-B. It made sense because it helped both the company as well as consumers who would be reminded that it time to change the brush and the company obviously in sales...

The last visit to a large retailer brought to my attention a new offering from Colgate which is also equally interesting , the SlimSoft Charcoal , the website enlists two advantages, first the micro slim-tip bristles help reach deeper between teeth & along the gum-line and second  the charcoal infused bristles remove plaque bacteria.

The other toothbrushes also had something to offer, but this one stood out....

If some much can be done on a simple toothbrush, then the scope and limits are which are set by a manager not a product....

Markets blooming during Diwali

If one wants to experience the festivities during Diwali one needs to move away from the Malls and shopping centers into the traditional markets. Went to two of the older markets in lucknow, sharing some photos from the visit. 

Candles being Sold by Kilos

People busy Buying

Diya's Being Sold

Brisk Sale of Pooja Items

Interesting full page ad

Saw an interesting print as so sharing

Season of full page Ads continue

A full page by mobile store talking about off line advantages

Will Online Retail Become Bigger than Modern Trade

After seeing the aftermath of the "The Big Billion Day" Sale an interesting thought is coming to my mind, will online retail overtake Modern Trade or Organized Retail in India? One of the reasons this question came to my mind looking at the reactions which came from the members of organized retail. They have all queued-up to complain against the 6the Oct sale and the fight in Mobile retail and online has been on for quite some time. Without getting into the rights and wrongs of the issue, I will move on to the moot question.. 

I will briefly summarize some of the key challenges which organized retail faces , prohibitively expensive real estate for setting-up retail stores. Internationally large format retailers would locate themselves outside the city where real estate is not that expensive and people would drive to buy from them. India we have challenges of people willing to travel long distance for shopping: one is the challenge of travelling along with the widespread smaller kirana trader…

Added to that the fact that no one has cracked the format which would suit India, so we still do not know which format will work. Lack of clarity on regulations, especially on the entry of multinational players. and most of the retailers are bleeding....

On the online front, there are challenges too, but somehow I have feeling they have the potential to challenge the Big Bazaars and Reliance Retail's. And perhaps the low priced "android one" phones might be the bridge that ecom players are looking for. And add to that the regulations are not very clear for ecom, though the government is making the wrong noises...

Though organized retail has been around for quite some time it not managed to breach the double figure mark in market share. Internationally the online players have become an additional channel, and co-exist with the large format retailers, but in India because both of them are emerging simultaneously the scene might turn out to very different in the next five years. 

I am confessing that I am going with the hype, the bubble….. but then that is the fun in being part of the hype and sticking your neck-out…

Season of full page ads 3

More full page advertisements, this time it is Big Bazaar, on flipkart sale.

Flipkart's Big Billion Day Sale - Sale with no Logic?

Typically every festival season marketers burn the mid-night oil to come up with block buster offers. For many years this responsibility was shouldered by LGs Samsung’s in the Durables Business and then the Mobile marketers, which lined up new products and offers during the festive season, but this year it is the ecom firms which are hogging the limelight or should I say the front pages of newspapers (albeit through full page ads)….

This post is specifically about the flash sales and the one-day sale model which flipkart has been using. They have had a series of flash sales for the Motorola and Xiaomi mobiles. Today morning they have tried a similar model with the one day sale model where they have ridiculously priced products up for sale like a Samsung Tab2 for 1,390, hand blender for 1 and so on

And this was backed up a fairly aggressive TV and print campaign and obviously numerous reminders on Facebook and where not...

But even at 8.02 AM in the morning what you can see is "Sold-Out" for these products, I think flipkart is playing with fire, what does it want to do with this kind of sale, create awareness? Then let them be warned, these limited stock deals create more heart-burn than any long term customer loyalty and if they think consumers cannot see through their tactics then they are again very wrong.

Do they want to clear old stocks,  or do they just want more people visiting their site??? Hopefully they are mature enough to think beyond the eyeballs model.

And even before the event I can see a lot of negative posts about them on social networking sites and even in the earlier flash sales , I could read more negative

comments than good experiences being shared.

I use to be a loyal flipkarter till some time back, but have shifted out to their nearest competitor, but even then I am worried about the direction which flipkart is going....