Marketing in Telecom

This May lot of action was seen in almost all big telecom companies in India. None of them wants to leave any prospective to be remained untapped. Ten years back, there was a term which was very popular and that was Cola Wars. One of the important strategies that Cola companies used to adopt was price wars. If one company slashes its prices, the second follow the suit. Same is being seen in the telecom space. Recently Vodafone has introduced a national STD pack of 75 paise/minute call on the purchase of 49 rupees card. Then Airtel introduced the same scheme but with 47 rupees card. One thing is sure that with all these promotion schemes, these companies would not get extra customer. Even if they get, it is very difficult to differentiate.

Second big marketing initiative in the last month was taken by Tata Indicom. Tata has introduced TV commercials stating that leave the normal technology and switch to Digital Technology where voice quality would be better. All these CDMA companies have tried their best to differentiate themselves  but could not make a mark in the minds of the customers. So positioning themselves as the digital network company, Tata indicom wants to have mind share of customers. But It is believed that most of the customers are not able to differentiate that Digital Network is same to CDMA.

Thirdly, the advertisement expense incurred by Idea. In NCR region, it has been found that Idea has purchased lot of billboard space, hoardings, Sunpacks etc. All these advertisements donot show any product, scheme or new offering. It is just Idea with a Yellow Background and ADITYA BIRLA GROUP written below. So they are just spending to increase the visibility of Idea as a brand and secondly to promote Idea as a company under the Aditya Birla Group, which may be termed as Empire Branding.

Recently one chain mail is going in lot of IT companies where in The Title of mail shows that it is an official Virgin Mobile Ad. It is very difficult to check the autneticity of the ad, but ad says that “We are more experienced than what our name Says”. It is really a nice ad or communication to show that we are not novice in the market.

All these big daddies are spending a lot in communicating and earning a large chunk of this sector. In India, there are more than 300 million mobile subscribers and it is to reach 500 million by 2012. So there is no recession in this sector and no company wants to go out of the sight of the customer.

 

Motorola

Motorola mobile handsets were among the first one to enter into the Indian market but they could not keep the pace with the growth of the industry. It was found that customers had very little belief in the brand even lower than the late entrants like Sony Ericsson, LG, Samsung etc. The other problem which Motorola was facing the lack of support from local retail outlets and opinion leaders. This was the short story of Motorola in 2005.

So in 2005, it started with the objective of gaining better foothold in the Indian market which presently has more than 350 million mobile subscribers. It tied up with its national distributor, Bharti Teletech to increase its retail touch points from 3000 to 32000. That was a significant move.

Then in 2006, It entered into distribution network with ITC e-choupal. The collaboration was termed as Bharat Moto with the objective of turning the opinion leaders into MOTO customers.

Then Motorola tied up with almost every big subscriber like Airtel, Vodafone, Idea, BSNL to offer low end handsets with every new connection.

Then the major boost happened to Moto brand by the TV commercials, The major strategy of Moto was bit different from others. Along with communicating the salient features of handsets, Moto made sure that it creates a oomh factor among the customers. It started a viral in the market that keeping a Moto mobile is status and every range of mobile can be flashed.

In 2007, Moto signed Abhishek Bachhan to endorse its Rokr E6 product which was a great success. In one of the surveys, Moto found that its customers are mainly the first time buyers of the age bracket of 16-35, so it targeted its communication to youth. It positioned itself as cool and new techy brand.

Moto was one of the few companies to start Digital marketing in India. It advertised heavily on portals like yahoo, rediff etc. Even its website motostar.in had more than 0.1 million registered users. So moto very well used Social Media Marketing(SMM).

All this marketing initiatives helped Motorola to offer sub brands like Flip Moto, Foto Moto, Moto Yuva. The parent brand assures the customers of the quality and the sub brands offered the company to expand its portfolio and target the larger audience.

So it seems that Moto has got a right fit into the fastest emerging market in India by targeting the youth. 

Marketing 3.0

10 years ago, the marketing was all about selling the product. It was a product centric era. The marketer’s job was all about selling the products without knowing the needs of the customers. That is known as Marketing 1.0. Henry Ford’s most famous quote is an example of Marketing 1.0 “Any customer can have a car painted as long as in black”.

Now the scenario is different, the customer is more aware, intelligent and companies focus on customers’ need. All companies try to fill the gap in the market. It is the customer who determines the value of the product, brand, and then the company. This era is known as Marketing 2.0. Now every company is talking about customer centralism. So again it is very difficult to differentiate between the companies and their products.

So a new era of Marketing 3.0 is emerging where in customers are treated as Human beings. So instead of customer centric now marketers are turning their companies towards human centric.  This is a period where customer is more active, involved, anxious and creative. The customer wants to fulfil more than his basic needs and wants. He is happier to have his desires fulfilled. What is being done by Apple by introducing ipod or iphone.

So Marketing 3.0 is all about targeting the hearts of people rather than targeting the minds. This is what is Airtel is trying to do since a long time. Airtel is encouraging people to connect with each other. This is also known as ‘experiential marketing’ or ‘emotional marketing’.

So Marketing 3.0 is a value driven marketing. The companies that are able to make a difference in the lives of the customers are there to sustain long term in the market.

 Courtesy: Book “Marketing 3.0 Values-Driven Marketing”

NewU Stores

Hardly listened about the new retail format, infact not new, its been more than a year that Dabur India has rolled out health and beauty stores under the brand name NewU with a tagline “Beauty Health and Welness” about U.

This retail format is in direct competition with Reliance Wellness stores, The Body Shop. Initially when it launched its first retail outlet in early 2008, Dabur had plans of expanding it to 160 stores in next 10 years. The first store was spread over 4,500 sqft and had 13,000 SKUs. As compared to that the latest one at Vasant Square Mall in New Delhi has smaller size 1200 sqft with the number of SKUs around 6000.

NewU concept is designed by the British brand agency Pikefell. This venture is really an opening up of a new page in the history of Indian retail sector. It offers a wide range of assortments from both national and international brands in categories like cosmetics, fragrances, skin and personal care, baby and family care, fashion accessories, herbal and ayurvedic pharmaceuticals.

As of now Dabur has 8 operational NewU stores in cities like Banglore, Hyderabad, Delhi, Ludhiana, Jalandhar and is planning to set up 10-12 more stores in a year.

These stores are targeted at the upper middle class and upper class segment of the society. With the increasing wealth and awareness about the personal care, these stores are bound to succeed in times to come. Though the recent halt is the result of global recession.

Dabur India Ltd's beauty, health & wellness retail arm - NewU - has been voted as the Most Admired New Retail Launch of the year at the fifth edition of Images Retail Awards (IRA) during India Retail Forum 2008 at The Grand Hyatt, Mumbai.

The store also hosts beauty experts to offer advice to its customers.  With this kind of structure, it becomes easier for global brands to enter into the Indian markets. 

Informational Vs Transformational Advertisements

There are two kinds of products. One is High Involvement product where in customer spends great time in evaluating the specific product from its competitors’.

Product like Cars, Schools, Mobile Handset etc are the examples of High Involvement products.

On the other hand, Low involvement products are those products where in the customer purchases on the whims. Products like candies, chocolates, toothpaste etc fall into the category of low involvement product.

Therefore, there are two kinds of advertisements to target these different kinds of products.

Informational Advertisements in which companies try to give as much information as possible in the ad so as customer gets a choice to evaluate various parameters as compared to that of competitors. High involvement ads change the consumers’ brand attitude through information.

In the case of low-involvement ads, companies try to transform the consumer’s brand attitude through transformational ads. Here in these ads, more emphasis is on creativity and repeat purchase is what companies look for. As creative ads may get customer to the product but then repeat purchase is what makes the brand successful.

According to Schiffman and Kanuk, ads can create affect and this leads to attitude building for the ad and subsequently for the brand, this is true in the case of low involvement products.  In the case of high involvement products, ads first create cognition, then develop attitude towards the ad and subsequently towards the brand.

Now a days, even the products like mobile services which to certain extent is high involvement product in India. But Still services like Call, SMS, Other VAS etc. It is difficult to differentiate two brands like Airtel and Vodafone. So companies use transformational advertisements where companies try to target directly to the mind of the people with its creative ads.

Psychological Pricing

Psychological Pricing is a marketing exercise where in prices are set to a level that is perceived attractive by customers. It is a marketing practice to show that there are certain purchases, which are done on the emotional grounds.

Now a days , almost all companies do psychological pricing such as BATA floaters @299, Mumbai-Delhi King Fisher flight @4099 INR etc. This pricing strategy targets the psyche of the customers, where in they look for the prices lower than the market price or customers in the end feel that they got the best available deal in the market.

There is a scientific reason behind this pricing. When customer looks the price as 100, he perceives is as higher compared to 99.95 because human minds rounds it off to 99 and thus goes for buying it. Another customer survey showed that customer feels happy when she received back some change after paying for the product.

There are few types of Psychologocal pricing, such as Comparison Pricing or reference pricing where in seller provides the reference of actual pricing and then discounted pricing. This technique is followed mostly in mega marts like Big-Bazar.

Prestige Pricing in which marketers charge high prices to show that the products belong to high quality and have cult status like AXE deo.

Odd-Even Pricing where in prices are rounded off to 49 or 99, the theory says that customers feel that it is well marketed product while in case of 100 rupees, customer will feel that marketers have well calculate his profit.

Percentage Discount pricing where in different levels of percentages are shown on the racks to show that company has reduced pricing. This technique is followed by companies like Cantabil, Koutons which increase the price and then sell at 50% + 49% discount, customer feels that he is getting 99% discount wherein he is getting discount closer to 75%.

So there are lot of ways to target the psyche of the customers and in this competitive scenario, marketers use such methods to increase their sales.  

Jaguar Bath Fitting

In India it is believed that the status of one’s family can be judged by the outlook of a bathroom. A decade back, people didn’t spend much on the interiors of the bathroom. More was concentrated on the functional products. But Jaguar changed all the rules of the game and offered a variety of bathroom fitting products. Jaguar is a market leader and thus so very successful in changing the perception of the people.

Before the entry of Jaguar, there were lot of small and fragmented players in the market and none of the market experts have ever believed that this so customer centric industry can ever be tapped by a national level organized player. Jaguar was the first company to offer after sales service at the doorstep. The brand Jaguar is in alliance with the demands of the young generation of India. Jaguar opened showrooms across India to introduce a bathroom concept where in customers can feel the bath-fittings in actual.
Innovation is also a part of Jaguar’s success story, where in company spend huge amount of money to introduce new products. Ceramic disc cartridge is one such product.

Jaguar has leveraged its brand equity by diversifying into other product categories like electrical fittings and accessories. Well jaguar has also joined hands with many International players such as Switzerland’s Aquis for sensor products, Glass Idromassagio for whirlpools and bath tubs and many more.

The core philosophy of the company is the customer service and this is the brand values. Company spends huge amount of money in below the line promotions so as to offer after sales service. On the other hand Jaguar was the first bath-fitting company to offer above the line promotions by introducing television commercials. The company offers training to its technicians so as they in turn satisfy the end customers.

The commercials of the Jaguar show that the brand is “TOO GOOD TO RESIST” and that is the tagline of the Jaguar. In one of the commercials of Jaguar, thieves steal the bath-fittings leaving behind other valuable items back. The commercial goes well aligned with the brand image of the company. With the changing nature of the Indian customer, company realized will in time that the value for money is what customers want and they are not price sensitive. That is why brand, quality and aesthetics are brand elements of the Jaguar.

Source: superbrands.org

Aggressive Kingfisher!

Last year Jet Airways introduced the Hoarding commercials saying that “We are changed”. Kingfisher put up a hoarding just above that saying that “We have changed them”. That was one of the most audacious and talked about communications.

This year Kingfisher is back and with more straight and direct attack on low cost carrier. Indigo.

There are three different set of outdoor hoardings that Kingfisher has put up in the different parts of the city directly targeting the Indigo, one of the no-frills airlines in India.

All the three hoardings are using comparative advertising where in on the left side, words or phrases are used to attack Indigo exactly in the same color and font as used by Indigo advertisements. On the right hand side, the reason to chose Kingfisher airlines is given on the deep red background.

Following are the pictures of hoardings.

In the current fad of direct advertisements, other low-carriers might feel that now next is their turn or it could be so that Kingfisher is bleeding that is why it does not want to leave any segment un attended.

ZooZoos

Must be astonished by the title of the post!!!! This is what is the most lovable and laughable character now a days in the news. Vodafone has introduced new character during the IPL to launch its VAS services. Every time you see the new commercial of Vodafone, surely you will laugh to the fullest. The brain behind the concept is O&M, one of the most renowned creative agencies.

ZooZoos has no technical or logical meaning; it is just the name to create word of mouth publicity. Vodafone plans to launch 30 different commercials to introduce 30 value added services like phone book backup, IPL on commentary, Map on phone etc.
Till date the company has introduced thirteen commercials. It has really created a ripple effect among the viewers.

To the surprise of many, Vodafone has not used digital imagery, neither it used some animated cartoons. Under the Egg shaped heads and white bodies, there are actual human beings, which is great.
All the advertisements are shot in such a short span of time with so much brand recall value. So many advertisements with so many communications can be a problem for the company. In the end chances are very high, that people might end up remembering only ZOOZOOS and not the value added services. But what ever, once again, the telecom giant has proved that it is just not Hutch Dog which is helping them in brand recall, they can do wonders with any character.