SOCIAL NETWORKING SITES.....NOT JUST FUN..!!

Social networking sites on the Internet are now regarded as one of the most important tools of communication. People have recognized social networking as the fastest and most trusted means of spreading news and making people aware of the facts and information. People have begun joining networking groups even as a status symbol. Being on a networking site is now considered as one of the best ways to get recognized. Being part of an online social network helps people to stay connected with their friends and families, and also to develop business links.

Companies recognized the marketing opportunity offered by social networking sites, and saw a huge potential for creating brand awareness, promoting their products, buying and selling products/services and also for developing business networks. A new marketing concept-Viral Marketing- has provided momentum for creating awareness about brands and products.

Many companies have embraced social media formats as part of their integrated marketing and communication strategies. This involves creating an online message that is entertaining and interesting enough to pass it on to others, thereby spreading the message across web like virus, at no incremental cost to advertiser. Viral marketing basically creates a word-of-mouth referral by using existing customers and contacts. The message is passed around and passed around repeatedly creating an exponential reach for the Company. People like to talk about their involvement with products and services for a variety of reasons. These include prestige and status that may arise through ownership, or an inclination to share their purchase experiences in order to help others. Viral promotions may take the form of Video Clips, interactive flash games, e-books, brand-able software, images or even text messages.

Viral marketing depends on a high pass-along rate from person to person. If a large percentage of recipients forward something to a large number of friends, the overall multiplier effect would be quite phenomenal and also the message would travel very quickly. This means that each person one reaches, one is also reaching a group of his /her friends as well. Then those friends tell other friends, leading to rapid increase in reaching down the line, which is in some way similar to what happens in many network marketing companies.

Few Examples:-

In 2007, Cadbury’s dairy milk chocolate launched a viral marketing campaign, which was much popularized on YouTube. During same year, World Wrestling Entertainment promoted the return of wrestler, Chris Jericho, with 15 a viral marketing campaign using 15-second cryptic binary video.

Recently Pepsi astonished the advertising industry by its move to ignore Super Bowl football matches and instead focus on Social Media. Pepsi, in an effort to leverage on social media, opted for the “Pepsi Refresh Project” which was rolled out in January 2010, to fund refreshing ideas that could change the world. Numerous individuals and organization visit the “Refresh Project” website via several social media platforms, and submit ideas for projects that could refresh their community. The next process involves public voting. The amount of money ($20 mn) saved by not advertising through Super Bowl is being diverted to supporting various selected projects every month ranging from $5000 to $250000 per project. Apart from serving as a promotional tool, social networking sites can also provide a platform to conduct product surveys, undertake research, build the brand, manage one’s online reputation, engage employees t know each other better, and recruit potential candidates for the company.

Contributed by

Manpreet Singh Nagi

FT 2010-2012 Section C

Nexus over the Net!

A couple of months back, Google announced discontinuation of online sales for Nexus1.
A couple of years ago, DELL did something similar for its laptop, though Dell did not stop online sales of its Laptops, it moved into a kiosk model in which customers could visit a kiosk, have a look and feel of the laptop they are interested in buying and then make the final choice.
Dell with its unique selling and distribution channels, was enjoying the second position in the market for a very long time (first being HP with 18% market share), but after the economic meltdown of 2009, as people started looking for cheaper products, Acer- a company based out of Taiwan had a 30% increase in sales making it the number two player in market with a 13% Market share.
Dell lost its USP (Unique Selling Preposition) of low price for high quality products. As more big players emerged, Dell found it difficult to maintain the unique bargaining power with the suppliers.
A zero inventory for Dell adds pressure to the suppliers as they are not certain of the sales volume. As a supplier, you would have less bargaining power if you have a fixed order than to have serve a customer with a JIT (Just In Time) Inventory system. As a result, Dell lost its competitive advantage.
Very soon, Acer with similar quality as that of Dell (most of the internal components are made by other manufacturer’s, example: Intel for processors, Nvidia for graphics etc) gave stiff price war to Dell.
Secondly, as the buyer is exploited by choice, he does not see sense in waiting for about a week for the product to be shipped. Acer is available at retail outlets and a buyer can always negotiate a deal with the local seller and also ask for ad-on gifts such as back-pack, pen-drive etc.
Let us have a look at Nexus One
Google's decision to discontinue direct sales, which comes less than six months after launching the online store, is fairly striking.
There is nothing wrong with the product (it has received a higher rating than the IPhone and the Motorola Droid by all tech forum and I have myself used the IPhone, Droid and the Nexus1) , there is enough publicity done, the price is very competitive, it has HTC and Google brand associated with it, but still the product isn’t selling.
Now, if we combine (have a nexus) of the issue faced by Dell and Google, we can see that there seems to be a change in which internet markets are going to operate in the future.
It seems, the shift would very soon be from B2C (Business to Consumer) to a more B2B (Business to Business) model.
Today, the consumer wants to have a touch and feel of the product before making a purchase decision. Internet and online sites are mostly used for doing a product research and comparing between different products, but the final purchase decision is made only after the “demo” is done.
As in the Dell case, the kiosks do not sell the laptop (they accept payment, but the order is still placed online), still, the consumer can have a look and feel of what he is buying, this avoids an uncertainty, thus removing the psychic price that the consumer might have to pay.
In the case of Nexus1, the consumer is not sure how the product is going to look and feel, even the most interactive website cannot replicate the look and feel of the product completely.
Internet market for B2C is promising if the companies are ready to re-innovate the business model and provide additional flexibility to the consumer.
For example, www.bigshoebazaar.com is a portal which enables consumers to order two shoes at a time in case the customer is not sure about the size, pay cash on delivery and when the shoe is returned, they reimburse the full amount of the shoe along with the shipping charges incurred by the customer.
Another example could be of companies into online gifting solutions, customers do not require the feel element while purchase from FernsNpetals (www.fnp.com), they would look for prompt delivery and payment security.
In case of B2B markets, since the goods sold are either raw-materials or have an option of being customized as per the buyers requirements, the need for touch and feel for the product is not strong, moreover, in such markets, it is feasible for the seller to send a sample to the buyer as the magnitude of order is generally big enough to cost the free-sample cost to each buyer.
So, we see that B2C channels are not very promising as the customer’s buying decision is based on the look and feel of the product.B2B and C2C (consumer to consumer) seem to be more sustainable business models over the internet.
Companies must remember that no matter how good your product is, you can’t see it unless the consumer wants to buy it.
Remember:
“The consumer isn’t a moron. She is your wife.” -David Ogilvy.

Contributed by:
Sanket Agrawal

NEUROMARKETING

Neuromarketing is a decade old concept. It all gained importance in 2004 when a half-dozen scientists from the Baylor College of Medicine published a research paper on change in brand preference to cola brands by using a Siemens Allegra 3T functional Magnetic Resonance Imaging (fMRI) brain scanner. The study concluded that when exposed to Coke labels, soda drinkers who hadn't previously expressed much brand preference suddenly had affection for the Real Thing. The drinkers' noggins lit up like Christmas trees after they sipped the branded Coca-Cola. The results demonstrated that Pepsi should have half the market share, but in reality consumers are buying Coke for reasons related less to their taste preferences and more to their experience with the Coke brand. In other words, our brains confirm that the brand with the more effective marketing wins and can even fake out our taste buds. The field of neuromarketing is growing up. While large corporations employ neuromarketing firms to conduct costly fMRI studies, a new breed of marketing upstarts with neuromarketing expertise is promising smaller entrepreneurs the same kind of knowledge without the high costs of custom lab research.


But basically what exactly is neuromarketing? Well, it is the practice of using brain-wave product feedback to target goods and services to our subconscious appetites. Neuromarketing is the application of this huge amount of information that's available in the literature in terms of how people make decisions. Technically speaking a research study conducted explains the concept as : Consistent with neuroimaging evidence suggests that distinct circuits anticipates gain and loss, product preference activates the nucleus accumbens (NAcc), while excessive prices activates the insula and deactivates the mesial prefrontal cortex (MPFC) prior to the purchase decision. Activity from each of these regions independently predicted immediately subsequent purchases above and beyond self-report variables. These findings suggest that activation of distinct neural circuits related to anticipatory affect precedes and supports consumers’ purchasing decisions.


Christophe Morin in his book “ Neuromarketing: Understanding the Buy Buttons in Your Customer's Brain” , says entrepreneurs can improve their products, services, marketing and advertising by learning six keys to neuromarketing : We are self centered, we crave contrasts, we are naturally lazy, we like stories, we are visual and emotion trumps reason. In future, marketing analysts will use neuromarketing to analyze consumer’s preference in an effective way. Personally asking question would involve a cognitive bias. This knowledge will help marketers create products and services designed more effectively and marketing campaigns focused more on the brain's response. Consumers’ reaction to the color of the packaging, various attractive shapes, the sound the box makes when shaken, or the idea that they will have something their co-consumers do not would be understood by the marketers through neuromarketing.


The main idea is that the decision is made and influenced by the subconscious part of the brain and by generally asking people about their preferences may only give us partial information about the factors actually influencing their purchasing behaviors. Also there are some things which consumers avoid to say when asked about their buying decisions due to emotions attached or the pride factor.However, this study is still in nascent stage and has a long way to go. Also the relevance of the initial results is not very convincing. Some analysts also fear the manipulative use of neuromarketing on children and marketing of harmful products. Every technology has positive and negative aspects. However, proper use of neuromarketing will help the marketers in making better decisions in the future and while integrating technology to increase the profits for organizations.

Contributed by: Abhishek Muley

Is Private Labeling Key to Retailing

Private label products or services are typically those manufactured or provided by one company for offer under another company's brand. Private label are often positioned as lower cost alternatives to regional, national or international brands, although recently some private label brands have been positioned as "premium" brands to compete with existing "name" brands. In India, the largest retail chain today has around 300-400 stores. The share of private labels in any country depends on how consolidated the retail chains are. Developing a good quality brand has a high development and innovation cost attached to it. To be able to absorb such costs, Indian retail chains will need to scale up. Retail chains in developed nations on the other hand have around 3,000-5,000 stores each. So it will start with retailers reverse engineering manufacturers’ brands, and as organised retailers grow larger, their labels, too, will move up the value chain. The biggest change in the last decade or so has been the entry of premium private labels. They are no longer saying “buy us because we are cheap”, instead today, they are saying “buy us because we are the best”. By offering high quality products, many private labels have started charging more than regular manufacturers. Consumers globally are in agreement when it comes to Private Label quality and value for money, with a global average of 69 per cent agreeing that they were extremely good value for money and 62 per cent considering their quality to be at least as good as the big brands.

Different types of private labels are Store Brands which are on retailer's name and are very evident on the packaging. Store sub-brands are products where the retailer's name is low-key on the packaging. . Individual brands which is a name used in one category, this is only used to promote a "real" discount product line. Exclusive brands which is a name used in one category, but to promote "added value" products within the category. Distributor brands which are large wholesale grocers and foodservice purveyors often have private labels, for example the Parade brand of Federated Foodservice and the wide array of private brands of the large food service supplier. Copycat private labels brands owned by a retailer which use similar trade dress, i.e. packaging as a leading national brand. Private labels help in building exclusivity and differentiation, bring customer loyalty, better margin, better control in deliveries ,brand equity, freedom in pricing strategy and increasing bargaining power with both national brands and private label factories. However there are some cons like inventory risk, higher R&D expense ,higher marketing expense ,no markdown or return allowance from branded suppliers , if product fails, will create negative image and quality control, complex production & import issues.

Some private label strategies which are being followed by various promoters of private label companies fall in one of the following category: Generic –very promotional, very low margin some examples are Conway, Walgreen . Fast Value Fashion – knock-off brands, Zara and H &M . Premium Store Brands – Retailer’s own brand offers same or better quality at better price. Retailers believe private brands are their strategy to differentiate, to gain and maintain consumer loyalty, to achieve higher gross margin , to compete with national brands , to change mind set and realize that Private Labels are competing brands to stay focused on target audience . Future of private label include that it will continue to play an important part of the assortment to their growth strategy ,becoming national premium lifestyle brands: INC, Alfani, Arizona, UMM, Bare, Jealous 21, branching out to create specialty chain business: George apparel stores, Wal-Mart, UK, increasing depth of multi dimensional merchandising product mix (Tony Hawk mens, boys, footwear and etc) ,cannibalize weaker private label brands and deploying a multi-layer strategy in brand, price and quality. Private retailers will occupy 50 per cent of the market the world over. At 50 per cent, they begin to saturate. If they try to occupy more than this, then consumers feel that there aren’t enough choices. In countries such as Switzerland and the UK, private labels have reached this limit and these markets have saturated. But they will continue grow in the other countries till they reach the same level and this will happen very soon in India, too.

Contributed by: Hitesh Gaur

New Market New Rules

Rural markets have gained significance, because of the growing economy which has resulted into considerable increase in the purchasing power of the rural communities. Owing to green revolution, the rural areas are consuming a large quantity of industrial and urban manufactured products. In this environment, a special marketing strategy, namely, Rural Marketing has emerged. Rural marketing is over and over again confused with Agricultural marketing – the latter denotes marketing of produce of the rural areas to the urban consumers or industrial consumers, whereas rural marketing involves delivering manufactured or processed inputs or services to rural producers or consumers. Rural marketing experts also term it as developmental marketing, as the process of rural marketing involves an urban to rural activity, which in turn is characterised by various peculiarities in terms of nature of market, products and processes. Rural marketing differs from agricultural or consumer products marketing in terms of the nature of transactions, which includes participants, products, modalities, norms and outcomes. The participants in case of Rural Marketing would also be different, they include input manufacturers, dealers, farmers, opinion makers, government agencies and traders. The existing approach to the rural markets has viewed the markets as a homogeneous one, but in practice, there are significant buyers and user differences across regions as well as within that require a differential treatment of the marketing problems.

These differences in approach could be in terms of the type of farmers, type of crops and other agro-climatic conditions. One has to understand the market norms in agricultural input so as to devise good marketing strategies and to avoid unethical practices, which distort the marketing environment. The importance of rural marketing can be understood from the fact that today modern inputs i.e. diesel, electricity, fertilisers, pesticides, seeds account for as much as 70% of the total cash costs and 23% of the total costs incurred by the farmers in the Green Revolution areas. Further the percentages were higher at 81% and 38% for small; farmers owning 1.85 hectares of land. Rural market offers huge opportunity to marketers, infrastructure is improving rapidly, and social infrastructure has improved a lot in past decade with more kuccha houses getting converted into puccha houses, percentage of people below poverty line has declined and literacy level has improved by huge numbers. Other opportunity is the use of available infrastructure of post offices (1, 38000+),haats, mela’s etc.Proliferation of large format rural retail stores which have been successful like DSCL Haryali stores,M & M Shubh Labh stores, TATA/Rallis Kisan Kendras etc. Rural marketing involves more concentrated personal selling efforts compared to urban marketing. Firms should desist from designing goods for the urban markets and subsequently pushing them in the rural areas. Distribution strategy need to be devised in a different manner compared to urban market. Communication channels should be chosen very carefully as only around 20% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns.

Some successful examples are of Escorts which had an focused approach depending on geographical and market parameters like fares, melas etc. Looking at the ‘kuchha’ roads of village they positioned their bike as tough vehicle. Their advertisements showed Dharmendra riding Escort with the punch line ‘Jandar Sawari, Shandar Sawari’. Thus, they achieved whopping sales of 95000 vehicles annually and HLL which started ‘Operation Bharat’ to tap the rural markets. Under this operation it passed out low–priced sample packets of its toothpaste, fairness cream, Clinic plus shampoo, and Ponds cream to twenty million households. Thus, looking at the challenges and the opportunities which rural markets offer to the marketers it can be said that the future is very promising for those who can understand the dynamics of rural markets and exploit them to their best advantage. Rural marketers should understand this fact and try to tap the huge untapped potential in our country, so they can successfully impress on the 230 million rural consumers spread over approximately six hundred thousand villages in rural India.

Contributed by: Manish Sharma & Prasenjit Sen

Ambush Marketing

Ambush Marketing, a term first coined by marketing guru Jerry Welsh.

The word Ambush means, the act of concealing yourself and wait to attach by surprise. But the word Ambush Marketing means something very different. It means a tactic whereby a company attempts to ambush or undermine the sponsorship activities of a rival that owns the legal rights to sponsor an event. In simple words it is where a company runs a marketing campaign around an event in which it is not directly involved or has paid a sponsorship fee. Ambush marketing is always associated with events. Ambush marketing is a planned effort by an organization to associate them indirectly with an event and gain some recognition and other benefits .

It is typically targeted at major sporting events like – like the Olympic Games or the world cups in various games and is a strategy adopted by rivals of the official sponsors. For example, in the Winter Olympics held in Lillehammer, Norway in 1994, Visa was one of the official sponsors. Its rival American Express launched an advertising campaign with the slogan: “If you are traveling to Lillehammer, you will need a support, but you don’t need a visa”. An example more familiar to Indians is Pepsi’s hugely successful campaign on the slogan “nothing official about it” during 1996 cricket World Cup, for which rival coke was one of the sponsors. Similarly, when Pepsi sponsored the 1999 Cricket World Cup, Coca Cola put hired people in the stadium and made them furl Coke flags, drink Coke, wear Coke T-shirts etc., in full view of the worldwide TV audiences. In 2004, the tables were again turned. Coca Cola sponsored Euro 2004, but Pepsi used its association with David Beckham and other players to produce a celebrity ad that successfully deflected and diverted viewers’ attention from Euro 2004.

There two forms of ambush marketing:
1) Association Ambushing: The non-sponsor gives the impression of being an official sponsor by using symbols and words associated with the event.

2)Intrusion Ambushing: The non-sponsor company creates hype in the media and goes for spectator exposure of the event by advertising near the venue of the event.

Some Strategies of Ambush Marketing:
1) Sponsoring the media coverage of an event: Kodak sponsored the broadcast of the 1984 Olympics where Fuji was the official sponsor.
2) Sponsoring a sub category within an event : During the 1996 Olympics Samsung which was not the official sponsor took an aggressive strategy against Panasonic which was the official sponsored the event by taking rights to a parking lot near the venue of the event. Panasonic managed just 3% awareness after the event while Samsung managed as high as 9%.
3) Making a sponsorship related contribution: Ian Thorpe, an Australian swimmer is the brand ambassador of Adidas while the team is sponsored by Nike. To protect his personal contact with Adidas he draped his towel over the Nike logo while receiving a medal at the Olympics.
Engaging in advertising with coincides with a sponsored even t- Pepsi floating a hot air-balloon over the final in Sharjah where Coca-Cola was the official sponsor.

More recently, there was a straight fight between Hero Honda, a global sponsor of the Champions Trophy taking place in Sri Lanka, and its rival TVS. TVS has, according to industry experts, paid Rs 12 crore to rope in cricketer Sachin Tendulkar as its brand ambassador for three years.Nike became the official uniform suppliers of many hockey teams during the Olympics without paying the huge sponsorship sum of $5 to 50 million.

Ambush Marketing has many ethical issues related to it. Nowadays there some legislative laws being put into place to curb the issues regarding ambush marketing. One such recent example is current ICC controversy. It is precipitated by the desire to protect official sponsors of the Champions Trophy. The ICC does not want to allow any company to cash in on its events secured by other sponsors paying huge sums of money. The objective was to protect the exclusive rights granted to the sponsors at a whopping cost of $550 million (until 2007).

Some measures which can be taken to curb Ambush Marketing:-
· Preventing tickets from being used as competition prizes
· Policing the event more strictly for “ambushers” and denying them access
· Using event regulations and participation agreements to restrict the rights that participants can grant their own sponsors (e.g., what athletes may wear or carry when they compete).

As such ambush marketing at the margins will arguably always occur and law alone will prove for the ingenious marketing strategies .The challenge now lies with lawyers to determine what strategies can be identified to curtail ambush marketing

Contributed by : Fahad Bagadia & Mohit Kapila

Are Mascots Worth Thousand Words ?

Mascot is ‘a person or animal or thing that is supposed to bring luck to its users.’ Mascot is used by a company as a part of a marketing strategy to interact with the customers or consumers. It is a way to gain more customers by using a mascot as a medium for physical and psychological interaction with them and distinguishes brand by having a marketable character. A mascot helps to brand the company/product and can be used in creating games (flash games, computer games etc.), commercials, advertisements, toys and cartoons. Effective ‘Brand Mascots’ increases awareness, sales and profits whereas ineffective ‘Brand Mascots’ do not amass customers or wealth, yet incur ‘MASS COSTS.’ A strong mascot marketing effort enables to create media exposure and excitement, generate goodwill for the brand, act as an ambassador for the brand by providing a voice for the company's social conscience and provide tie-in identification at point-of-sale (the mascot boldly featured on packaging, in-store merchandising, trucks and T-shirts), and sell products.

For effective development of a character or mascot a company should spend reasonably to develop a professional character that is worthy of the product, contact professional firm to guide through the important development phase. Character development, particularly for mascots, requires a special base of knowledge to make it work successfully as they must have strong identification with the brand and use mascot everywhere from signage to collateral to in-store merchandising to packaging, advertising and events which will enable brand association .Apart from this whenever a company wants to introduce a new mascot they need to identify that whether the present mascot is consistent and helping company to increase sales, the withdrawal of the existing mascot is a good decision and will the new mascot be efficient enough? To answer above questions and decision more accurate one has to fall back model to the model knows as Brand Mascots v/s Brand MASS COST. In this model one needs to compare few things like:

1. Relevance v/s Irrelevance:. If it is a highly industrial category or a highly technical category, it may be prudent to look at other branding means rather than use ‘BRAND MASCOTS.’ This is because the target audience is serious and there is high probability that they may consider mascots frivolous and casual, thereby destroying the rational product story, the technical competence as well as the product efficacy image. While on the other hand in categories like services, FMCG or other consumer products, a ‘Brand Mascot’ may work out to be relevant and effective.

2. Attract versus Distract :If the ‘Brand Mascot’ is able to attract consumers towards the brand, not only in terms of awareness, but also in terms of trials, purchase, consumption and repeat purchases, then the ‘Brand Mascot’ is working. However, if the Brand Mascot distracts from the brand and its products and service usage, then it would just be a Brand Mass Cost. In fact many years ago, 7-up lost its product usage because Fido Dido actually distracted consumers from the product. Consumers bought the concept of Fido-Dido - the ‘Brand Mascot’ and did not buy 7-Up, the brand itself. There is a very thin line between attraction and distraction and must be worked on very carefully.

3. Focus versus Hocus-Pocus :Over a period of time there has been a focus on the Air-India Maharaja. Its consistent usage has definitely helped the Air-India business and created a special identity reflecting the culture and splendor of India and its history. The ‘Brand Mascot’ clearly symbolises that the passenger would be treated like a King. This focus has helped. In some other cases constantly changing brand mascots under the garb of boredom leads to a shallow, inconsistent hocus-pocus thus leading to ineffectiveness.

4. Brand Mainline Versus Brand Sidelined :Everything a ‘Brand Mascot’ stands for should keep the brand in the mainline and mainstream to bring out its core values and benefits. It should not let either the brand or its benefits get sidelined. There was a feeling that Gattu, the ‘Brand Mascot’ of Asian paints had outlived its utility and the brand was brought back in the mainline with Gattu being removed so that the mother brand does not get sidelined. If a choice has to be made between the brand and the brand mascot, it is better that the ‘Brand Mascot’ be sidelined because ultimately the brand is the hero and celebrity, whereas the mascot is only a support.
Thus, as per this model if the four parameters are appropriately evaluated, ‘Brand Mascot’ will work, otherwise it may turn out to be just a ‘Brand Mass Cost.’ After all a mascot is supposed to bring good luck to the user, isn’t it?

Contributed by: Vaibhav Gupta

Blue Ocean Strategy

Blue ocean strategy focuses on how to link innovation to commercial value. While traditional strategy, or red ocean strategy, exploits existing demand, blue ocean strategy creates and captures new demand. In a red ocean, competing companies usually have to choose between differentiating themselves at the expense of pushing up costs, or stay low-cost and undifferentiated from rivals. Rather than beating the competition, a blue ocean strategy works by making the competition irrelevant. There is a four-action framework for applying blue ocean strategy: eliminate, reduce, create and raise. That is, evaluate which factors the industry takes for granted but which can be eliminated, which factors can be reduced to below industry standards, which new factors should be created, and which should be raised above industry standards. In a blue ocean, companies realize both differentiation and low cost. In other words, returns from investments in blue oceans are substantially higher. Yet 86% of business launches by companies fall in the red ocean category. According to a study the revenue impact of these red ocean launches was 62% and profit impact 39%. The remaining 14% of business launches that fell in the blue ocean category accounted for 38% of revenues and had a profit impact of 61%. Research into blue ocean strategies in the 120-year-period from 1880-2000 demonstrates blue oceans are not about technology innovation. For instance, although the hugely successful iPod uses sophisticated technology, people buy it because it is so stylish and simple.

A good example of applying blue ocean strategy was seen when Ninentendo employed it for its Wii games. Wii's launch helped Nintendo grow sales 90% and profits, 77%. Its better established rival, Sony, was losing $ 240 on each Playstation 3 model sold, while Nintendo was making $ 40 on each Wii sold, With the Wii, what Ninentdo did was ask itself how many customers used high-definition TV compatibility, a feature that was pushing up the cost of the console. The answer was hardly any. So it decided to do away with this feature, keep the price of the Wii low and also target non-core gamers with the product. Thus using a blue ocean strategy, it created a new market for itself instead of fighting for share in the market space dominated by Sony's Playstation and Microsoft Xbox. It focuses on opening up new and uncontested market space and thereby reconstructing buyer value elements that resides across the industry boundaries.

Contributed By: Ritesh Baranwal

Interactive Marketing

All types of marketing share a common goal which highlights the features of a product or service. Interactive marketing is one such effort on the part of marketers.

Interactive Marketing refers to the evolving trend in marketing whereby marketing has moved from a transaction-based effort to a conversation. John Deighton says interactive marketing is the ability to address the customer, remember what the customer says and address the customers in a way that illustrates and remember what the customer has told us. People are emotional, intuitive beings; they would not believe what you as a marketer wants to say, but they would definitely listen to what other people want to say about your product and services. This is what is targeted in the interactive marketing.

In interactive marketing, first the marketer should Engage the consumers. This can be done through online communities or websites, through TV contests and other medium. The next step is Retaining the trust and relationship with the customer. This can be only done by ethical practices and good customer service and relationship. Then Learning is the next step in line. The preference, choice or behaviour of the consumer should be recorded and database should be maintained for the same. This helps understanding the consumer behaviour and in designing the future marketing strategies. The last step is Relate i.e. relate to the consumers needs and requirements, customization and personalized service are used in order to relate to the consumers.

Though internet technology is one of the major communication mode used by marketers for interacting with the customers, interactive marketing can be done using other communication channels like telecommunication or mobile technology, Television, Radio, print media can also be used. Reality shows on leading TV channels in India thrive on interactive responses from viewers through SMS messages. These either enable participation on the shows or decide the winners on the reality programs telecast. Kaun Banega Crorepati 2, the second edition of the Indian equivalent of "Who Wants to be a Millionaire", elicited 1.6 million phone calls/SMSes for the first three episodes telecast on Rupert Murdoch owned Star TV in August 2005. In early 2006, viewers cast as many as 55 million votes through SMS/telephone/internet to decide the winner of a singing contest "Sa Re Ga Ma Pa Challenge 2005" on a TV channel.

Amazon.com is an excellent example of the use of interactive marketing, as customers record their preferences and are shown book selections that match not only their preferences but recent purchases. Kelloggs cornflakes SMS-based contest, to promote Iron Shakti ingredient in its cornflakes is another such example. Coca-cola’s interactive SMS promotion to promote Vanilla Coke is again an example of interactive marketing. As is evident from the various examples, across different product categories marketers are treading the interactive path to consumers' hearts and minds. To elicit proper responses to the contests, marketers dole out attractive prizes, such as mobile phones, T-shirts, CDs, vouchers redeemable at department stores, audio systems, TVs, etc.

The future of interactive marketing is very bright in India. The growth in internet penetration and broadband and scope for greater involvement of customers in such programs can only expand the scope for interactive marketing in India. The impressive growth rates clocked over the past year are likely to slow down, as the base increases. However, a promising future on the anvil for interactive marketers in India is not in doubt whatsoever, as estimates predict that by 2010, India is slated to have the third largest mobile and internet user base worldwide.

Contributed by: Ashwini Mavuri

Brand v/s Product

Some days back, in the marketing class, I found myself listening to as well as speaking the words "brand" and "product" far too often. However, what I realized was that we are not too clear when to use these words. This prompted me refer to a lot of material on this subject. Following is a summary of all the ideas I could gather:

A brand is a collection of images and ideas representing an economic producer; more specifically, it refers to the descriptive verbal attributes and concrete symbols such as a name, logo, slogan, and design scheme that convey the essence of a company, product or service. A product is anything that can be offered to a market that might satisfy a want or need.To highlight the difference, I would like to put forth a recent example: The Shahrukh Khan commercial featuring Dish TV concentrated on portraying its features viz. pause live shows, get the language of your choice, movies that you like and so on. Here, there is no real creativity involved. The ad is plain vanilla informative marketing. However, the more recent commercial of "Tata Sky Plus" featuring Aamir Khan and Gul Panag concentrates more on talking to customer based on the experience from the perspective of a regular young couple which almost any middle class consumer can identify with. Thus, apart from providing information about the product to its target customers, the commercial is also successful in creating a long-lasting imprint in the viewers' minds - thus creating a better recall for its brand.

This example highlights one very important factor. The product in both the cases is DTH technology service. Although there are hardly any differences in terms of the products qualities and features, there is a marked difference in the way the target customers perceive the product. This is clearly due to the way the brands have been positioned. So, on a broad level, a product is something made at a factory. On the other hand, a brand is something which is bought by the customer. Typically, a product can be copied by a competitor whereas a brand is unique - it’s either there or not there. A product may be outdated very quickly whereas a successful brand may be timeless. A product may change from time-to-time depending on its life cycle stage; a brand typically remains consistent over a long period of time. A product is a more producer/seller centric approach; a brand is a customer centric approach. Thus, a marketer yearns to convert his products into brands which can then be leveraged to get higher returns for his products. A brand involves a loyalty factor, thus making it very enticing for marketers to convert their long running products into brands. As a side note, one also needs to keep in mind that a strong brand can be built only for a strong product which performs according to the expectations consistently.

Contributed by: Deep Agrawal

Geo Marketing

As a general term, Geomarketing is the integration of Geographical intelligence into all marketing aspects including sales and distribution. Geomarketing Research is the use of geographic parameters in research methodology starting from sampling, data collection, analysis, and presentation. Geomarketing Services are more related to routing, territorial planning, and site selection whereas the location is the key factor for such disciplins. The core base of Geomarketing is the digital map; it can either make or break the concept.
In marketing, geo (also called marketing geography) is a discipline within marketing analysis which uses geolocation (geographic information) in the process of planning and implementation of marketing activities. It can be used in any aspect of the marketing mix - the Product, Price, Promotion, or Place (geo targeting). Market segments can also correlate with location, and this can be useful in targeted marketing. The methodology geomarketing is successfully applied in the financial sector through identifying ATMs traffic generators and creating hotspots maps based on geographical parameters integrated with customer behavior.
GPS tracking and GSM localization can be used to obtain the actual position of the travelling customer.
Geolocation software is used to display data that can be linked to a geographic region or area. It can be used to:
Determine where the customers are (on country, city, street or user level).
Determine who the customer is (on organisation or user level), or make a guess on it based on earlier encounters by tracking IP address, credit card information, VOIP address, etc.
Visualize any data in a geographic context by linking it to a digital map.
Locate a web client's computer on a digital map. Calculate summary information for specific areas. Select customers within specific areas. Select customers with a certain radius of a point.
Using micro-geographic segmentation select customers similar to a specific type in the rest of the country.
A typical example for different web content by choice in geo marketing and geo targeting is the FedEx website at FedEx.com where users have the choice to select their country location first and are then presented with different site or article content depending on their selection.
Automated different content
With automated different content in internet marketing and geomarketing the delivery of different content based on the geographical geolocation and other personal information is automated.
Other
Solve problems regarding location of a new retail outlet. Map consumer demand trends to best distribute products and advertising. Scope digital advertising towards individual consumers.
Research consumer shopping patterns and observe traffic within shopping centers and between retail outlets. Improve customer cooperation.

Contributed by: Bharat Jain

Surrogate Marketing (Advertising)

Ever wondered why Bacardi and Royal Stag entered launched their music cd’s, what made Kingfisher enter the segment of mineral water?

The answer to this is surrogate advertising.

The makers of these brands were banned to advertise and they resorted to surrogate advertising. It is a sort of advertising where a cover product is promoted in order to promote
the actual product that is banned. Surrogate marketing refers to intentionally utilizing a company, person or object to help convey the message of another party. The term has both positive and negative connotations. On the positive side, surrogate marketing is somewhat akin to grassroots or viral marketing in which a marketing organization may actively recruit others to help spread the message or can also be likened to hiring a manufacturer’s representative to sell your product.

However, it is the negative side that seems to have drawn the most attention. A surrogate advertising campaign can be used to indirectly promote products or services deemed by some groups as being unhealthy, unethical, and immoral or, possibly, illegal through activities that are viewed as acceptable forms of promotion. For instance, in some parts of the world where regulation exists that may ban promoting alcohol and tobacco, firms promote these brands by tying the brand names to more acceptable products. For instance, the same brand name used for selling cigarettes may also be the same brand name on a juice product. In this way the customer is not only aware of the acceptably advertised brand but also understands the connection to the regulated product.Surrogate advertisements took off not long ago in the UK, where British housewives protested strongly against liquor advertisements "luring" away their husbands. The liquor industry found a way around the ban: Surrogate advertisements for cocktail mixers, fruit juices and soda water using the brand names of the popular liquors.

In India, ministry of health has banned the advertising of liquor and tobacco. But many liquor brands (like McDowell's whisky) initiated other products like sodas in the same name which are then advertised. Another instance of surrogate advertising is 'Four Square Bravery Awards' in the name of Four Square cigarettes.

Surrogate marketing is used in two contexts: the first is when a company "farms out" the entire marketing function and the group providing the service is called a "surrogate marketing department." I don't believe this is the context for which you are looking. The second is what is happening in India with respect to the ban on tobacco and alcohol advertising. Companies in banned industries are introducing brand extensions with products that are legal to advertise
with the same brand name as the banned product. One liquor company introduced apple juice with the same brand name as the liquor. The idea is the companies can advertise freely the extension - thus keeping their banned-from-the-media products in the minds of the customers. So the apple juice, for instance, is the surrogate for the liquor in the ads. The companies also don't care much about the sales of the surrogate products -for instance, it seems that the apple juice isn't even readily available to buy throughout the company. This loophole that the tobacco and liquor companies are exploiting is upsetting the legislature because every apple juice ad that reminds the consumers of the liquor is a slap in the lawmakers' faces. But, they also don't quite know what to do about it!

In general, surrogate marketing is when you promote one product or service in the hopes of selling another. Why you would want to do that varies. The best reason is that you aren't able to legally. But other reasons might be because the two products sell better together - for instance, you may make a product and it requires service - which you don't provide. You can market a service provider - the surrogate - who will only use your product.

Contributed by: Arjun Chawla & Jason Monserrate

Organized Retailing in India

The recent years have witnessed rapid transformation and vigorous profits in Indian retail stores across various categories. This can be contemplated as a result of the changing attitude of Indian consumers and their overwhelming acceptance to modern retail formats. Asian markets witness a shift in trend from traditional retailing to organized retailing driven by the liberalizations on Foreign Direct Investments. For example, in China there was a drastic structural development after FDI was permitted in retailing. India has entered a stage of positive economic development which requires liberalization of the retail market to gain a significant enhancement.

Domestic consumption market in India is estimated to grow approximately 7 to 8% with retail accounting for 60% of the overall segment. Of this 60%, organized retail is just 5% which is comparatively lesser than other countries with emerging economies. In developed countries organized retailing is the established way of selling consumer products. Despite the low percentage, Indian textile industry has grown noticeably in organized retailing of textile products. The negative phase in exports may have compelled the Indian textile retailers to explore the opportunities in the domestic market substantially causing the outstanding growth in the concerned segment. These indications give a positive notion that organized retailing has arrived in the Indian market and is here to stay. It is expected to grow 25-30 per cent annually and would triple in size from Rs35,000 crore in 2004-05 to Rs109,000 crore ($24 billion) by 2010.

India is on the radar screen in the retail world and global retailers and at their wings seeking entry into the Indian retail market. The market is growing at a steady rate of 11-12 percent and accounts for around 10 percent of the country’s GDP. The inherent attractiveness of this segment lures retail giants and investments are likely to sky rocket with an estimate of Rs 20-25 billion in the next 2-3 years, and over Rs 200 billion by end of 2010. Indian retail market is considered to be the second largest in the world in terms of growth potential.

Contributed by: Abhishek Devpura

360 Degree Guerrilla Marketing

360 degree guerrilla marketing means Marketers may run classified or small display ads offering their brochure and directing people to their Website. Many maintain awareness on the radio, with cable TV, in business magazines or regional editions of national magazines. They use signs wherever feasible and stay in touch regularly with both prospects and customers with postcard and standard mailings. Guerrillas employs 360 degree marketing by blending low tech and high tech with high touch and high care.. This type of marketing is never intrusive and very inexpensive -- even when you employ the wide range of weapons available to you, more now than ever because of the staggering growth of the Internet. Most business owners select a wimpy arsenal of marketing weapons, figuring that if they spend enough, they're covering the bases. Today, there are more bases than ever and if you're not attending to most of them, opportunities are speeding past you at lightning speed. The reason to employ 360 degree guerrilla marketing is because most prospects are in the market for what you sell only a small fraction of the time. If you're not talking to them at that time, they'll talk to somebody else. With less than 360 degree guerrilla marketing, your chances of connecting with them at that fleeting moment are cut down dramatically. The fragmenting of media is still another reason to go all-out with marketing and still another opportunity to go easy on your budget because fragments cost much less than whole parts -- TV to selected neighborhoods runs a teeny fraction of the cost of TV to the nation. You can be sure they have an active referral system, tapping the enormous referral power of past customers to learn the names of potential customers. They produce and mail brochures -- printed, audio or video, or all three. They take networking seriously and appreciate that rare chance to ask questions, listen to answers and learn of problems they can solve.

Guerrillas are joiners of clubs to learn industry information, meet movers and shakers, and contribute their time and energy to the organization. They offer free consultations and demonstrations whenever possible and set up alliances with other companies in co-marketing ventures -- especially online. They are linkers of the highest order. There's a good chance they publish a newsletter, possibly even a catalog. Many pen a column for a publication read by their prospects and run a stand-out Yellow Pages ad if businesses such as theirs gain customers that way. They offer their speaking services for free to local groups and have warm, trusting relationships with people at the media in which they hope to gain publicity. When they get it, they make reprints to post and mail. However ,even when they're doing all this, they're still engaging in only 180 degree guerrilla marketing. Reality today means the other 180 degrees comes from their wise presence and impressive activity online. 360 degree guerrillas are frequently mentioned in online news reports, host online conferences, and run contests at their site. As new opportunities arise online, and arise they do on a daily basis, guerrillas seize and test them, making sure their aim encompasses all 360 degrees of marketing. Combining all this weaponry on a continuing basis, over a long period of time rather than in spurts, is a tough job. But succeeding with a small business isn't supposed to be fast or easy. Thus, by using 360 degree guerrilla marketing, succeeding does become far more of a certainty.

Contributed by: Abhishek Devpura & Bharat Jain