Advertising in Slowdown

Advertising is a communication tool used by companies to sell their products and services. Through advertisement companies try to persuade consumers to buy their products or services.

It was expected that during downturn advertising will be the first thing to be axed but figures show something else. Ad spends by top five FMCG companies have raised by 55% in the 2nd quarter of the year 2009-10. 70% of the total revenues generated by advertising sector come from top FMCG companies.

Instead of curbing their expenditure on advertisement, companies started launching their old existing brand in market. Henkel did this by relaunching its soap brand, Margo and also increased advertising and communication spending to 11 percent of the total sales.
The one of the main reason to increase expenditure on advertising is retain existing customers, who might switch to cheaper product.

Companies want to increase their market share by spending more on advertising and marketing. Relaunching and brand promotions lure customers to stick to brand and also attract new customers. During recession times customers become careful in spending. So each company wants to convince customers to prefer their brands. Research shows companies that slash advertising by 50 per cent take three to four years to recover their sales post-recession.

Marketers are wooing consumers with instant gratification, therefore they are using promotion such as discount sales, test drives of cars and get free assured gift(by Hyundai ), buy “a shampoo get a soap free” etc. In apparel retailing, discount plays magnetic role in enhancing footfalls. End of season sales lead to 30-45 per cent jump in sales. Especially in case of kid wear where parents prefer to shop during discount period as kids outgrow clothes fast.

Companies have understood that value retailing appeals to customers so they spend lot on advertisement to increase customer buying, in store promotions helps in impulse buying. Brands like Arvind has also received benefit of impulse buying in their store by introducing range of accessories, where by their average ticket size has increased by Rs 400.

Result too show that increased spending on advertising paid off. HUL’s net profit rose 19.6% from a year earlier and sales were up 21%. Marico’s revenues and net profit grew 28% and 15%, respectively. GCPL’s revenue jumped 26%, although profit was up just 1%. At Dabur, revenue and net profit grew 12.2% and 25%, respectively

Ritu Wears

Ritu wears is a well known Retail brand present in North India. In 1965 Ritu Wears entered the Indian fashion Industry with a 200sq.ft children’s wear store owned by the enterprising Mrs J.D Sahni. It started offering fashion and lifestyle to consumer since its inception.

Ritu Wear has emerged as one of the favorite brands. It success can be measured by its popularity amongst consumer. From single outlet of 200 sq.ft, now Ritu wears has 10 stores which are present in Delhi NCR Region and parts of Punjab. By opening new stores Ritu Wears is reaching close to customers who were far away from the store.

Ritu wears is a customer centric company. Every decision of the company revolves around customer insight. From opening of new stores to expanding their range for clothes. It’s a brand for passionate. Ritu Wears has always believed that without passion there cannot be fashion.

Be it is any festival, or any occasion, Ritu Wears is always there for its customers with collection for that offers. Ritu Wears specialty lies in being a fashion store for the entire family. Ritu Wears want when customer think of family, fun or fashion, they should think of them. The reason why RW is a complete family store is that not only cater exquisite fashion products to the tastes and preferences of every age group but also provide lots of shopping extravaganza and fun for the entire family

Ritu wears has achieved so much popularity amongst its customers due to the efforts being put by lot of people at its back end operation team. Director of company Mr Sahni and their entire family pays lot of personal attention to every feedback from customer and they themselves do product testing before it reaches to final customers. This helps in minimizing customer complaints. Distribution chain of Retail house follows proper coordination from head office and store level which ensures that product reaches customers on time.

Demand and supply gap is reducing to minimal by the constant efforts of the management team. The team follows the strategy of 3 B’s i.e Belief-----Behaviour --------Business.

For eg; if you believe that you want to give best service to your customer then it will be reflected in your behavior (actions) and which result into good business for the organization.

For this organization structure is framed in such a way that there is proper communication and coordination within all levels where best solution/variety can be given to customer.

Once customers are in store him / she finds something for everyone. Visual Merchandising of stores is taken care by management to provide pleasant atmosphere for shopping. Signages and Branding make accessibility easy for customer.

Marketing team of store is very strong, they come up with innovative ideas every time to attract customers to store. Sometimes with footwear Carnival, sometime it’s with Mother’s Day special offers etc.

Ritu Wears is amongst the few fashion houses in India that has successfully initiated and redefined not just sense of dressing with its brand new collections but also the shopping experience itself along with establishing new avenues. The products in its portfolio include apparels for men and women in segments including formalwear, casual wear, ethnic wear, party wear; kids wear, accessories, footwear and a wide range of national and international brands in lifestyle category

Brand Sense

Currently 83% of all commercial communication appeals only to one sense – our eyes. That leaves a paltry 17% to cater for the other four senses. This is extraordinary given that 75% of our day-to-day emotions are influenced by what we smell, and the fact that there’s a 65% chance of a mood change when exposed to a positive sound.

The effects of sensory branding are astounding. Yes, it’s possible to create a truly spectacular commercial, or an impressive advertising jingle, but they begin to become effective only when the two elements are combined. The effect is magnified many times over when you include any of the other senses. So the idea of sensory branding sounds good in theory? Well, practical steps need to be taken in order to move your brand from its two dimensional world into a five-dimensional place.

There are strategies to employ so that this transition will be successful. Events, moods, feelings, and even products in our lives are continuously imprinted on our five-track sensory recorder from the second we wake to the moment we sleep. This despite the fact that most mass communication—including advertising messages—that we’re exposed on a daily basis comes to us on two of the five available tracks. They’re visual and they have sound. We are so used to it, we never give it much thought. Herein lies the anomaly. As human beings, we’re at our most effective and receptive when operating on all five tracks, yet not many advertising campaigns, communication plans, or brand-building exercises utilize much more than sight and sound to put their message across.

Many people cite the new-car smell as being one of the most gratifying aspects of purchasing a new car. The smell is as much a statement of newness as the shiny body. In fact there is no such thing as a new-car smell. It’s an artificial construct, a successful marketing ploy that taps directly into fantasy. This smell can be found in aerosol canisters on the factory floor that contain that “new-car” aroma.

As for cornflakes, Kellogg’s considers the crunchiness of the grain as having everything to do with the success of the breakfast product. Emphasis is placed on the crunch we hear and feel in our mouths rather than the sound effects we hear on commercials. Kellogg’s has spent years experimenting with the synergy between crunch and taste. As part of this research they made contact with a Danish commercial music laboratory that specializes in the exact crunchy sensation of a breakfast cereal. Kellogg’s wanted to patent their own crunch, and trademark and own it in the same way they own their recipe and logo. So the laboratory created a highly distinctive crunch uniquely designed for Kellogg’s, with only one very important difference from traditional music in commercials. The particular sound and feel of the crunch was identifiably Kellogg’s, and anyone who happened to help himself to some cornflakes from a glass bowl at a breakfast buffet would be able to be recognize those anonymous cornflakes as Kellogg’s.

The day Kellogg’s introduced their unique crunch to the market, their brand moved up the ladder. They’d expanded the perception of their brand to incorporate four senses (including touch) rather than the more limited sight and taste. So by appealing to another of our five senses they broadened their brand platform.

In fact, as far back as 1973 Singapore Airlines broke through the barriers of traditional branding with their Singapore Girl, a move that would prove so successful that in 1994 the Singapore Girl

celebrated her twenty-first birthday and became the first brand figure to be displayed at the famous Madam Tussaud’s Museum in London. Previously airlines had based their promotions on cabin design, food, comfort, and pricing—ignoring the total sensory experience they could offer. Singapore Airlines made the shift when they introduced a campaign based exclusively on the emotional experience of air travel.

With a brand platform emphasizing smoothness and relaxation, their strategy was to move away from portraying themselves simply as an airline and instead to present themselves as an entertainment company. In the process, a new set of brand tools were invented and introduced. The staff uniforms were made from the finest silk in a fabric design based on the patterns in the cabin décor. The staff was styled right down to their makeup. Flight attendants were offered only two choices of color combination based on a palette designed to blend with Singapore Airlines’ brand color scheme.

The sensory branding of the Singapore Girl reached its zenith by the end of the 1990s, when Singapore Airlines introduced Stefan Floridian Waters. Not your average household name, to be sure, Stefan Floridian Waters is an aroma that has been specifically designed as part of the Singapore Airlines experience. Stefan Floridian Waters formed the scent in the flight attendants’ perfume, was blended into the hot towels served before takeoff, and generally permeated the entire fleet of Singapore Airlines planes. The patented aroma has since become a unique trademark of Singapore Airlines.

By the end of the 1990s Daimler Chrysler established an entirely new department within the company. This was not to design, build, or even market cars. Its job was solely to work on the sound of their car doors. That’s it. With a team of ten engineers allocated to the task, their only role was to analyze and then create the perfect sound of an opening and closing door.

Brand communication has reached a new frontier. In order to successfully conquer future horizons, brands will have to find ways to break the 2-D impasse and appeal to the three neglected senses. Superb picture quality won’t do it. Rather we should look to embrace all five senses in order to create a foundation for future brand strategies.

Courtesy: Lindstrom_Brand: Brand Sense

Dominos: New positioning

Here is a brief description of how Dominos’ evolved as a brand over the period of time. Dominos’ call itself to be in Food Services sector but not as a pizza player. The very definition of Marketing is that it is discipline of optimally allocating company’s resources for fulfilling consumers’ needs so as to ensure a balance of consumers’ subjective profits and the company’s long term financial profits.

Over a period of time, customers’ perception about Dominos changed and hence the subjective profits also varied. To sustain the long term profits in the market Dominos’ had to work hard in redefining its positioning in the minds of the customers.

For any business the first thing to do right is to choose a right segmenting variable. Segmenting variable could be anything like demographic parameter like age, region, sex etc. Or attitude behaviour like lifestyle, culture, belief, habits etc. Most of the people would be surprised to see that age, disposable income and family size are not the segmenting variable of Dominos. Infact the segmenting variable of Dominos’ is OCCASION. They have segmented the market on the basis of occasion so that people want a meal replacement for change in mood, party, spending time with family and kids, spending time with old friends, formal meeting with colleagues, clients and so on and so forth.

So dominos business is providing a high quality tasty food in meal replacement sector. When Dominos entered into Indian market, they tried to establish in a pizza category. First of their communications and tag line was based on the attitude that whenever and wherever you are hungry just call dominos. “HUNGRY KYA?” in one of the initial advertisements Mallika sherawat was the model. So some of the advertisements did fairly well and they established points of parity with other players.

Soon they realized that for home delivery model, time is the parameter which most of the customers value so they created a points of difference by new value proposition that is “30 Minutes or free”. Paresh Rawal featured ad in monsoon of Mumbai was a real hit and got many national and international awards. So after some time, when dominos’ business was not growing as fast as they expected they did lot of in depth and focus interviews where they found that it is not fast service which is the value driven parameter for customers, it is Taste which people want to pay for along with value for money. So once again as per the customers’ expectations Dominos’ introduced pan size pizza worth rupees thirty five and it all along changed the perception of people that Domino’s is a value for money.

So now responding to the customers’ reactions of valuing taste as the foremost reason to order pizza at home or office. They spent huge amount of money in R&D, hired new chefs on Dominos’ payroll and introduced various new variants in the Indian market like Cheese crust, Chinese pizza, other regional flavours etc. Some of them were instant hit and some could not do well. But one thing was very clear that constant innovation in product would only make your company better.

So now company has established three core values namely “30 Minute, free delivery”, “taste” and “Value for money”, with once again new positioning. “KHUSIYON KI HOME DELIVERY” is a new tag line and by virtue of this proposition, they could incorporate any of the core value in a same tagline. This is a beauty of any successful brand “CONSISTENCY”. The brand which is consistent over a period of time across product line is there for long time. Recently Dominos’ have introduced new series of commercials featuring sawant. Dominos is a smart company and they kept on this advertisement for quite a long time because of the recession in the market so they are banking upon the value proposition.

Hope to see brand dominos there for long time in the market with new brand proposition.

Videos of Dominos can be watched at the following link

http://www.dominos.co.in/advertising.jsp

Thanks to Dominos senior management for above piece of information.

Horlicks

Horlicks is a health drink brand existing in India since decades. Horlicks holds 50% market share of milk beverage market of India that is around 2300 crore (source: The Nielsen Company). GlaxoSmithKline Consumer Healthcare is a proud owner of such a strong brand. The brand has created such a great entry barrier that other big players like Nestle and Dabur have got a hit.. Nestlé has stopped making Milo and new entrant Dabur India has decided to stay clear of Horlicks and pitch its Chyawan Junior against GSK Consumer Healthcare’s other beverage brand, Boost.

One of the important reasons of Horlicks domination since years is because of constant innovation not intems of product only but also marketing. GSK Consumer Healthcare has decided to use the brand to get into new categories. In the last few months, it has launched biscuits for children, a nutrition drink for women, an energy bar and chilled milk.

The crazy thing is that Nestle and Dabur fell into the trap of Horlicks. It is GSK who dictates terms, all these new categories always existed in the market and GSK identified the market gap and filled it with its new product line. GSK is fully utilizing the strong brand equity of Horlicks to promote its new products and now Horlicks is India’s 6^th trusted brand.

When marketers see saturation in the market, they have either two choices one expand the market second increase the usage of its existing products. As of now Horlicks is banking on the first strategy and that is very obvious Young kids would like to continue with Horlicks when they grow older.. As increasing the usage is very difficult. Again, five years ago, GSK Consumer Healthcare had reached out to pregnant and lactating mothers with Mother’s Horlicks; last year it came up with Women’s Horlicks catering for women across age groups.
There’s Horlicks Lite for the elderly who often have a sugar problem and for the youth there is Horlicks Nutribar

With Horlicks Nutribar, positioned on the twin planks of health and convenience, GSK Consumer Healthcare has leveraged the brand to venture into an entirely new product category — energy cereal bars. A strong brand, opens up doors to new variants and even new categories.

In 2003, the brand was revamped: It was made tastier and launched in two new flavours — vanilla and honey. The company had earlier launched a chocolate version to try and win over consumers in the North and West who typically prefer chocolate-flavoured drinks. Not just higher tonnage, the company does succeed in extracting a price from consumers. In January this year, for instance, prices were upped by about 5 per cent. But it has been seen that parents in India can spend to maximum limit on two things Child’s nutrition and education. Horlicks cover the first part.

Horlicks has used media mix to its full capacity to reach out to every customer be it TV, radio, Print, Point of sales etc. Now it seems the next big task and if it succeeds, Horlicks would become the biggest brand in India is to sell Horlicks in rural India and make every villager drink Horlicks Milk.

Update: Cadbury

Cadbury has come with new TV commercial targeting the office goers. The Cadbury has maintained its tagline “KUCH MEETHA HO JAYE”. This advertisement is perfect example of occasion-based marketing. Customers can very well relate with this advertisement and since Cadbury chocolates are considered as Sweets so it gives them the reason to celebrate their salary day.

This ad clearly targets a middle class man who eagerly waits for his salary to come and spends next 10 days spending his salary with him family and friends. So Cadbury has just positioned itself in between that joyous moment of every person.

The background song was taken from the actual song AAJ PEHLI TAAREKH HAI from Kishore Kumar’s movie PEHLI TAREEKH. Team at Ogilvy has conceptualized this commercial while Ehsaan and Loy have composed the music.

The ad can be viewed at the following address

http://www.afaqs.com/perl/advertising/creative_showcase/index.html?id=13163&media=TV#