Importance of Category in Branding

If one is launching a new brands then perhaps one of the early decisions one has to make is the choice of the product category in which it would enter. The product category helps one identify the competition and the possible positioning option one can choose. This point has been highlighted by Al Ries in one his earlier Ries reports

Brand building - Dove Way

Traditionally one would find that ads of a soap would emphasize on making the user beautiful either directly or indirectly through the use of celebrity endorsements . But the series of ads used by dove is very different in the sense that the ads challenge the concept of beauty as has been traditionally seen. The Dove Evolution Ad has won two Grand Prix Advertising awards recently. On the web page it says "In a world of hype and stereotypes, Dove provides a refreshingly real alternative for women who recognize that beauty comes in all shapes and sizes".

The Dove Evolution Ad



They have recently launched the Dove "Onslaught" Ad



The details about the brand, its standing in the US market as per their website

• the world's number 1 cleansing brand
• sales of over € 2.5 billion a year in over 80 countries
• outsells all other skin care bars combined in the US
• over 1 billion showers taken with Dove products in the US each year
  

All these campaigns are part of the "Campaign for Real Beauty", which has a website of its own with a host of activities linked to the brand....

So the question is what is dove up to ?
It has managed to create enough buzz in the market place with its campaigns which have been recognized by both the industry and consumers as being some thing different.....

This ad has been discussed by many bloggers, link

Packaging as a source of innovation 2

Earlier we had seen how quantity in packaging, specifically lower-quantity has lead to increased usage and penetration in categories like shampoo, oils.... now we will try and see the other benefits one can derive from effective packaging, apart from the basic functions like protection, making them easy to identify, and enhance their presence at the POS.

Packaging can be used as a way to assure the consumer about the product's quality, when one uses a see-through packing. The see-through packaging induces customers to try the product, and in cases where the nature of the product is such that physically experience is requires then the see-through packing helps provide a substitute . It also helps in those categories where the willingness of consumers to try out new brands might be low. This is being done by most of packaged foods being market.

Effective packaging can help enhance the basic functioning of the product. I have know many of my friends who would switch brands when they see a more convenient packaging with a competing brand. When a shampoo manufacturer comes up with a new bottle which can be kept inverted so that every time you don't have to struggle trying to force the shampoo down the bottle it will attract customers. The packaging used by Parachute Coconut oil increases the convenience for its customers. It has the option of a wide necked bottle from which consumers can remove the oil in winter when the oil would freeze and smaller trial packs.

In the Indian context one also finds that companies try to use packaging as a means of protecting their products from counterfeiters. The special crimp packing used in the case of Bisleri is to assure customers that the bottle has not been tampered with. And, even the fact that we as Indians like to find use of old products and if the packging helps us in that we would be more happy dealing with that company. This can be seen by how we reuse used containers of paints and oil as substitutes for buckets and PET bottle of coke and Pepsi finding it's way to the fridges of most homes...

The scope of packaging in enhancing the products visibility and eventually sales of the product is unlimited and thus I feel it needs to be given its due importance in the marketing mix...............

Microwave Oven gaining acceptance among Indian Households

In new product development one finds very few totally new-to-the-world products, most of the products we see as new products in the market place are the new improved versions of the older products. Microwave oven is one those few products which would fall under the classification of new-to-the-world products. The discovery of the product itself was more out by accident than by design. According to wikipedia " Cooking food with microwaves was discovered by Percy Spencer while building magnetos for radar sets, he was working on an active radar set when he noticed that a peanut chocolate he was carrying in his pocket started to melt".

Microwave as a product has become a high growth segment in Indian market only recently, initial launches very not very successful, but with the changing lifestyles and family structure the product is finding more and more acceptance among Indians. Another reasons given is the fact that microwave cooking is not suited to Indian way of cooking , and with the changes made by manufactures to incorporate additional features to accommodate our cooking styles has also lead to its increased acceptance. The projected production of microwave oven sin the country is set to touch 1 million next year.

Packaging as a source of innovation - 1

Though packaging is at times considered as the 5Th P of marketing mix it has not received the attention it ideally should have. According to Harish Bijoor ( Marketing Consultant) "Packaging is an integral part of the brand mix and this is the day of attractive shapes and vibrant colors. Therefore, the brand manager has to consider a host of things such as shape, design, color, mnemonics and graphics, in order to make his brand more visible"

Packaging innovations can be seen from two varying perspectives, one wherein in adds to the basic functionality of the product through providing additional benefit to the consumers and second would be when it enables trials and increased usage by virtue of pack size (small). We have many examples of both the cases in Indian market, though the small pack as a source of innovation has received more attention than the other.

Small pack sizes have enabled marketers to reach consumer groups who were earlier not considered to be their target customers. The sucess of small shampoo sachets in rural markets have become marketing folklore which every student of marketing is told.The basic logic behind the small pack introduction is the understanding that the consumer though might not be able to afford to buy the full bottle of shampoo but wanted to use shampoo. And the fact that he would be able to afford buying it in smaller quantities, moving from cost of a monthy hair cleaing to cost per use to the consumer.

Though it is being said that the sachets would die a slow death with the emergence of organized retail , as in the organized retail context sachets become easy target for pilferage and they are not very keen on promoting small packs and would rather want the consumer to buy bigger packs. But in the market you would still find many companies continuing to come up with more and more small packs, like the recent amul mini butter packs, and parachutes small packs, and with the mom-and-pop stores dominating the retail landscape of India for a long time to come these introduction would only add to their turnovers ...

Second aspect of how packaging adds to increase the functionality of the product would be the subject of the next post....

Islamic car - Segmentation Strategy?

Malaysian automaker Proton along with Iran and Turkey are planning to build an Islamic car. The additional features are supposed to be a compass to find the direction of Mecca and a compartment to keep the Koran in. The realization that as a marketer one needs to be able to address the cultural differences among consumer while designing products and communications has always been acknowledged and we even have a separate sub-discipline called multi-cultural marketing which specifically addresses these issues. The question this proposed new product introduction raises is "Is a need for a specific product like this in the first place or is that the case of a marketer trying to exploit the religious sentiments of a specific set of consumers?" There have been many critical comments on the idea already, saying that it is cynical marketing.

The idea that one should target specific needs of customers within larger markets through segmentation is a well accepted marketing strategy which has lead to many successes. But from what is available in the media the only additional features it boasts of is the compass and compartments for Koran and the Scarf. The company has also made claims that it has identified a huge gap in the market. Lets us suppose for a minute that there is indeed a need for such additional features in a car how long will it the competition to add a few compartments and compass to their exiting models and bring out their own versions of the Islamic Car?

Internet and the Net Generation

The influence of IT especially internet on marketing has been of much interest to marketers. Its influence on consumer buying behavior can be seen from varying perspectives , one would be how it influences the current population interms of how they are using the net for information search and purchases , another much more interesting way is to try and understand how these emerging technologies are influencing the younger generation , a generation Don Tapscott calls the Net Generation in his 1997 book Growing up Digital .The author claims that because of their access to the digital media these young people learn, work, think, shop and create differently than their parents. A generation bigger than the baby boomers itself and one which would dominate the twenty-first century through its sheer demographic muscle.

The size of this net generation is estimated to be close to two billion internationally, and inspite of the low penetration levels of PC in the country (3%), we also we have our 'net generation' which is influencing marketing. A recent study done by Walt Disney company and GroupM shows that children in the age group of 8 to 14 years function as consultants to their parents when it comes to buying mobile phones, computers and television sets. They help out parents’ particularity for comparison of one product to another. The findings point to two things one is how the decision-making is changing with the Indian society moving on from joint family system to nuclear families, and the implications for marketing communicators on whom they should target in their communication plans....

Though the basic contention that Don Tapscott had was that as this generation grows up they would influence the way they shop, access information and receive media, but what we see here is the influence that they are having currently owing to their familiarity with technology .....

update 1 : found a good post of something related to the younger generation and how can one target them on Sandeep Krishnamurthy's blog http://marketingcollege.blogspot.com, the post if an interview with David Morrison founder of TwentySomething.com

update 2: Found a good related blog written on one of my favorite blogs wikinomics.com on the net generation link.

Segmentation and the Concept of Gravity of Decision Spectrum

This is in continuation with earlier posts on segmentation, though a little theoretical may be more examples can be brought out through comments and discussion..

Segmentation is the first critical step in the marketing process once a need has been identified. The process of segmentation, targeting and positioning provides the bases on which one decides the 4 Ps of marketing mix, product, price place and promotion.

In segmentation we divide a market into distinct groups which have distinct needs, characteristics or behavior, so that the company can focus its resources on satisfying the customers in this distinct segment rather than spreading itself thin trying to serve the whole market.

A 2006 HBR article, Rediscovering Market Segmentation provides us with the latest on the concept. They propose a 'gravity decision spectrum' to avoid the error marketers commit by applying segmentation designed to shed light on one kind of issue to some other purpose for which they are not designed. They suggest that one should begin with the expectation consumers bring to a particular kind of transaction.

The authors have divided the gravity of decision making into three, first is shallow, which involve the decisions which are simple and inconsequential like trying out a new brand of toilet paper and at the deepest end are decisions which have very high significance like buying a house and others which fall in middle.

An example of the shallow end was the case where in a manufacturer of men’s shaving products wanted to introduce disposable razors but feared that it might cannibalize the sale of its reusable razors. Segmentation exercise carried out classified consumer into those who use either disposable or reusable and those who switch. The company found that the switchers formed a very small segment and introduced the disposable razors.

In the middle end of the spectrum the article gives the example of the segmentation exercise carried out by Toyota prior to the launch of its Hybrid Prius in the US market. The consumers wanted car with greater power and faster acceleration than what was being offered by Prius. But through segmentation they discovered a small segment of consumers who were environmentally conscious and wanted to project that image and were also happy with the design and performance of the car and thus it was launched to this small segment through a focused media campaign.

At the deep end is an example of the people opting for Retirement community centers at a very high cost. The segmentation exercise revealed an orientation towards changing family values driving the purchase of these expensive retirement options. The two key values characterizing this segment were identified as the desire for autonomy and willingness to embrace.

Thus we can see that in each of these three cases the bases for segmentation differed and they brought out insights which helps marketers improve their decision-making.

Previous post on the issue

Segmentation and Demographics

Paras Pharma Succeeding through Segmentation

Rule of Three in India

Marketing Guru Jagdish Seth has been promoting his theory rule of three and has a book on the topic named The Rule of Three. The basic proposition put forward by him and his co-author Rajendra Sisodia is that in just three major players emerge in all markets. Which essentially means that in any product category only three players would survive and all other players in the given industry will have to limit themselves to being niche players in the market.

Ex- US food restaurants McDonald's, Burger King and Wendy's, Automobile market in the US. The book was written in 2002 and in one of his visits to India the author was asked if the rule of three would apply to Indian markets, to which he had said it would be applicable here and perhaps in response his new book on Rule of three in India is also coming.

Infact is one were to observe the Consumer Durables market the phenomenon can be seen to be working already. Coming back to Fridge purchase again, our visits to many shops across the city found only two brands being promoted LG and Samsung. When we asked for other brands either the variety was not there or the salesman didn't show any interest in promoting them. Other than the fact they are not Indian companies a consumer doesn't have much to complain agianst the two companies , they provide good quality products at reasonable prices and have built their brands based on that ..........

Books on Business History

1. McDonalds Behind the Arches by John F Love
2. Google Story by David Vise and Mark Malseed
3. Nuts ( The South West Story)by Freiberg and Freiberg
4. iCon Steve Jobs by Jeffrey S. Young and William L. Simon
5. The Disney Way by Bill Capodagli and Lynn Jackson
6. The Rising Tide ( History of P & G) by Dyer, Dalzell and olegario
7. Sam Walton Made in America ( Wal-Mart Story) by Sam Walton
8. Iacocca An Autobiography by Lee Iacocca
9. Made in Japan (Sony) BY Akio Morita
10. Who Says Elepehants Cannot Dance ( IBM Turnaround Story) by Louis V. Gesrstner Jr.
11. Direct From Dell by Michael Dell
12. Only the Paranoid Will Survive (Intel) Andy Grove.
13. Richard Branson the Autobiography
14. Pour Your Heart into It: How Starbucks Build a Company One Cup at a Time (The Starbuks Story) by Howard Schultz
15. It Happened in India ( Pantaloon Story) by Kishore Biyani
16. Jack Straight from the Gut, (GE) by Jack Welch
17. POP : Truth and the Power at the Coca-Cola Company, by Constance L Hays.
18. Shift Inside Nissan's Historic Revival, by Carlos Ghosn and Philippe Ries
19. iWoz, (Apple), Steve Wozniak
20. The HP Way, David Packard