Management Practices

Rebranding the brand Airtel

2011-04-28T06:05:00.000-07:00

Before I start writing anything, lets have a look at video-

You must know that this music has made history as world's most downloaded mobile music with over 150 million downloads. With intention to go international and please global audience, a company must not loose the local flavor. That is what we call 'think global act local'. In spite receiving such respect from customers Airtel went ahead and changed the signature tune.The maestro(A R Rahman) has again delivered a masterpiece-

Recently Airtel acquired African operations of Kuwait's Jain group in 15 countries at an enterprise value of $10.7billion. With the acquisition, it added 40 million more subscriber to its over 130 million subscriber base. One thing was sure that Airtel will introduce itself in a completely new Avtaar and so did they. To please the new customer and giving it an international flavor, Airtel launched its new logo and new signature tune. Now, before we talk about logo, lets have a short discussion about its signature tune:

Signature Tune:

signature tune made by maestro A R Rahman was the most recognized mobile tune and create a history by the number of downloads. As I earlier said, a company should never loose a local flavor for international exposure.One thing about earlier tune was that it was instantly catchy when compare to general trends related to A R Rahman tune. The new tune lyrics is written in alien language. It looks more peppy and international in its approach. Now lets have a look at data collected from twitter:

1- 19% are positive, 12% are neutral and 69% are against the change,

2- 72% agreed that previous signature tune is better than new one

seems like Airtel failed in repositioning itself from above data, but a lot is yet to come and after all, now company has to create an international appeal. So practice can not be concluded here.

Logo:

Airtel changed all its old posters, hoardings and banners with old logo.There is no street, no traffic signal, no major hoarding that's left untouched by striking red and white combination of its unique new design.

company spend Rs 300 crore on development of its new logo as a part of its internationalization and a London based company 'Brand Union' design this new logo which also handle the account of Vodafone.

new airtel logo: designed by Brand Union

The latest major upgrade by Airtel to its visual brand representation is precisely a desire to stay relevant (in the customers' mind) in a changed world because this visual representation carries the entire persona of brand with it.The words used, the colors chosen and the way the whole things blends together is a direct representation of the class of brand itself. A picture speaks a thousand words. People may not know the company well, may not be its customer, but the logo strikes the certain chord in their head when they see it.

zain logo

Now the question arise why Brand Union choose to use small cap+swoosh+red. Lets see one by one:

Red:

Human mind hit hard by the red and red is the color which represent aggressiveness, appealing and visible. Red color is an integral part of the brand which shows energy and dynamism and led to success.

New Curve:

the new curved addition to the logo is a symbol which will help ensure instant recognition across diverse international markets.

Small Caps:

small caps represents the internet and email generation and it also looks informal.

Swoosh:

swoosh represents the speed and supposed to be modern

If you look at Zain logo carefully, the element of swoosh(resembling the a) is there already. Perhaps Airtel had to borrow that (as a part of deal) and fix it into the new existence. So the new Airtel is the old Airtel plus the Zain a shape, plus a striking red.

JWT is working in Asian countries on new positioning which says, "dil jo chahe paas laye". In Africa Ogilvy is the agency working for positioning .

Now the beauty lies at the bottom in executing the program.It was amazing that logo was changed almost everywhere simultaneously. it was a tough task because there must be lacs of outlet and places where old logo was placed and new logo had to suddenly appear.But the commitment shown towards change was intense and appreciable. For Airtel everything has been changed right from logo, signature tune and positioning, but it was necessary to introduce itself to new world. Great job has been done in execution of the program. Hope that Airtel will provide best services in African countries as it has done in Asian countries.

Price Point: an important factor to increase volume & penetration

2011-04-26T14:41:00.000-07:00

Great Mahatma Gandhi once said "India lives in villages". Later on in 20th and 21st century, great marketer research on villages and wrote saveral books about the immense opportunities available in villages for business. Still, Products like shampoo, cold drink etc were not being frequently used by Bottom of the pyramid. Consumption of such products was very low in rural markets because people used to wash their hair with soap instead of purchansing a 100 ml bottle shampoo worth Rs 70 or 80. Then came marketer like Cavinkare pvt ltd and Coca cola, who changed the face of rural consumption habit and suddenly the bottom of pyramid become the hot place for FMCG companies. Cavinkare came up with small sachet of 4ml and 6ml in 50 paisa and Rs 1 respectively which was the first revolution for rural market. Consumption of shampoo increased in an unexpected way in rural market. Few other example of such innovations are Coka Rs 5 price point for 200ml coke, 40 gm soap at Rs 5 price point and small toothpaste tubes and oil sachet to increase consumption with frequent traveller. Lets see the communication strategy of coke price point Rs 5 for 200 ml bottle-

In my previous post I have written about different channel to be created by major FMCG companies to cater this huge rural market. But having strong distribution model is not enough for having greater market share. You must have good product offering at affordable price point. Aiming at major market share, big FMCG companies including coca cola, pepsico and britannia are introducing product in low price point particularly Rs 5 as a part of their strategy to shore up volume and increase penetration.

According to market research agency A C Neilsen, bottm of pyramid segment provides a huge opportunity, although currently it contributes only 20% of total consumption and is tipped for explosive growth. By 2015, more than half of consumption spending in India would come from families earning Rs 25,000 a month.

Indian branded powder ready to drink market is valued at Rs 300 crore and the orange flavour is the largest segment in powder softdrink industry where Rasna controls over 90% market share. Coca cola decided to re-enter into branded powder ready-to-drink market with its brand 'Fanta Fun Taste' at an attractive Rs 5 price point in 23.5 gm sachet after it pulled the plug on its sunfill brand 6 year ago.Company has decided to place the product in 1500 outlet across maharasta and gujrat as a part of its pilot project. Company has clear strategy to target the consumer segment at the bottom of socio-economic pyramid.

On the other hand, to maintain market share of company, biscuit giant Britannia has consistently focused on lower end of segment by bringing out products in small packet size and low price point.One reason why Britannia efficiently maintain its market share is because they provide premium quality biscuit under brand name 'Tiger' and 'Treat' lower price point.

Beside these companies, Pepsico who already launched 'Lays' and 'Kurkure' at price point Rs 5 also played at lower price point Rs 5 to increase consumption of its brand 'Nimbooz'.

For FMCG companies these low units pack and low price point has been used as a strategy to build the brand appeal. They act like a brand ambassador even they contribute major chunk of volume. Low price point halps the brand to increase the penetration, while small packs increase the volume because of their convinience. low price and small packs are seem to be best strategy to increasing penetration as well as volume. Hope few more players will come up with different products to cater this market with same strategy.

Emami: again with item song

2011-04-21T10:22:00.000-07:00

Kolkata based consumer goods company "Emami Ltd" said that it has entered into a co-branding pact with Fox Star Studio to promote its talcum powder brand "Navratna cool" by using the title track of latter's upcomming movie 'Dam maro dam'. It seems like with the success of Dabang's munni badnaam hui, Emami is trying to go with famous item songs.

On 17 september 2010, company send a legal notice to Arbaz khan to withdraw "Munni badnaam hui " song from movie or withdraw the brand name from the song. Later, they realize that movie became super hit and that led brand to perform beyond the expectation.Zandu balm sale soared by almost 35% after realise of the video and company stock was trading 6% higher on BSE.

Excited by the success of Munni badnam hui, company decided to promote its winter moisturising lotion under the boroplus brand with popular item number 'shiela ki jawani'. Shiela could not make so much noise but it was an economic way to do the promotion of brands and so company keep on going.
Now company has gran title song of Dam maro dam featuring Deepika Padukone as a part of its television commercial. Its a co-branding practise through which both brand and movie will be promote. Another reason for such initiatives can be like its a cost effective promotion methos where it is easy to connect with the consumers.
Lets see how much 'Dam' this ad can show. Munni has shown its power already, but Deepika could do the same, not guaranteed.

Cadbury Dairy Milk: Trying to change the cultural preference

2011-04-21T07:07:00.000-07:00

Before I write anything, have a look at these advertisement being aired on television frequently:

Now what? what is so special about this advertisement, this must be the question in your mind. If unable to understand then watch both the video again.
Yes, they want the chocolates to replace traditional sweets at home. Cadbury India is continuously giving new reasons to eat its chocolate. New ad is aimed to bite the territory dominated by Indian sweetmeats. To have an effect,TVC shows a family where chocolate served as dessert. This is a great attempt made by Cadbury India to change the positioning of Dairy milk from a occasional products to one that is consumed everyday. In India, chocolate are still considered to be an impulse purchase and not a part of everyday life. Cadbury's earlier campaign like "shubh arambh" and "kuchh meetha ho jaye" displayed cadbury's endeavour to own the meetha category- just like Coca Cola did few years ago with..Thanda matlab coca cola campaign.

From moment of celebration in everyday life to special occasion, cadbury offer different packaging and product to win over indian consumers. Now Cadbury trying to place the products at home and make it part of household daily consumption habit.
Marketplace- In India, chocolate market has been estimated around Rs 2000 crores and clearly polarized between two giants, Cadbury and Nestle. Obviously Cadbury emerged as leader having 70% market share with flagship brand Dairy milk leading with 30% market share.still main problem for marketer in India is the level of penetration. In India, chocolate penetration is 6-7% and hence has huge potential for growth.In cantrast, in Brazil, an emerging economy with similar weather condition has penetration as high as 75%. This is just because chocolate is acceptable as snacking option in other countries which is not the case in India.. Cadbury has been continuously trying to capture the market and increase the penetration. Remember, way back in 1994, they launch a campaign "kya swad hai zindagi ka". As the girl in the ad danced her way into the cricket field, Cadbury managed to get young adults shed their inhibitions about eating chocolates in public, opening a new market for chocolates.

Then again in 1998, Cadbury India realised that many young people still want rational justification to involve with chocolate. Then they launched another campaign "khane ka bahan" with real people saying why they ate chocolate. but now cadbury has bigger challenge at hand to increase both- depth as well as the frequency of consumption.

Sweet Substitute:
But, can Cadbury replace traditional sweets from plates of indians? It seems to be very tough because in India sweetmeat prepared with ghee, sugar and milk are seen as filled with goodness. Affortability is another concern where you can buy a box mithai at a comparable price and shared it with your family.But how many people can share a bar of chocolate? question.
Experts believes that campaign has been made for such huge behavioural change that it will not deliver. This can also be seen as the possessiveness of a kid for chocolate. Product innovation is another challenge. In the past, Cadbury launched Dairy Milk Desserts in unusual flavours like Tiramisu and Kalakand which did not hit the consumers’ sweet spot. “Perhaps, going ahead, the brand could launch chocolate bars meant for diabetics or weight watches. Ramanathan of KPMG feels the Cadbury Dairy Milk could be made available in mithai-shaped pieces to appeal to Indians familiar with Indian sweets.

typically a box of sweets is usually shared by a family. Thus by deviding the chocolate into pieces the brand is building on those codes that we are familiar with and introducing it into chocolate. If watch closely, the new commercial targetting middle class family where families are going nuclear and do not get time to prepare traditional sweets at home.
So, with a keen eye set on market growth, Cadbury can be expected to find new ways of introducing something meetha in our lives.Hope their initiative will show its effect early but it seems to be difficult because of affordability, typical indian consumer behaviour, penetration level and stiff behavioural change.

Iced Tea: Nestea vs Lipton

2011-04-16T05:08:00.000-07:00

Cola war between two giant do not seem to be finished yet. May be it could not reach up to that level, but their JV has make them face each other once again. Yes, two majors Coke & Pepsi are again in front of each other in JV of two other giants Nestle & HUL respectively.

Hindustan Unilever and PepsiCo are reviving their seven-year-old joint venture to sell ready-to-drink teas and tea beverages by re launching Lipton ice tea, four months after Nestle and Coca-Cola brought Nestea ice tea. Lipton tea will be rolled out in ready-to-drink bottles next week in Delhi and the NCR region. The PepsiCo-HUL alliance launched Lipton ice tea in 2004, but the product was withdrawn within a year for lack of demand.
In 2004, concept was ahead of its time. There was no awareness for such product and country like India where Tea only meant if it is hot; it was difficult to change the consumption habit. That time HUL failed to connect its product with consumer and consumer didn’t accept the product. As time went on, people started shifting from fizzy drinks to healthy alternatives. Iced tea has still not caught the imagination in India despite being there for some time now and of course it will take its time established in India.

Still iced tea category is growing, and reading the trends, Coca-Cola along with its joint venture partner Nestle launched ready to drink bottled ice tea in Nov, 2010. Nestea has been positioned more as lifestyle, youthful, trendy and refreshing drink. Nestle first roll it out in Mumbai and set to launch the product in other part of country by next year. Under the 19-year-old global agreement between the two firms, the rights to manufacture, distribute and market the Nestea brand in powdered and vending machine formats are with Nestle, while Coca-Cola holds the rights to make, distribute and market Nestea in glass and PET bottles and cartons. Nestea is licensed to Beverage Partners Worldwide (BPW), a 50:50 Joint Venture between The Coca-Cola Company and Nestle S.A.

Rivalry between two firms and involvement of such big players can develop the niche segment very fast.Of course the segment will take its time to develop, but once developed, these players will get the benefit of first mover advantage. And most importantly, with changing consumer preferences and openness, segment seems to grow fast.

BLEED BLUE: beauty of a campaign

2011-04-15T02:06:00.000-07:00

Over the years I have seen many advertising campaigns during these Cricket World Cups. A part of the Cola War history is also articulated in this tapestry. Pick up the Pepsi’s subtle “nothing official about it” campaign set against Coca Cola, the official sponsor of the World Cup during ’96. The popularity of that campaign is so pronounced that the phrase finds recognition even today(That is why I know even otherwise I was not at all interested in advertisements in 96). But as time moved Pepsi was unable to re-create the magic. Much of circumstantial bad luck is also conniving to stop Pepsi from achieving a viral proliferation. For example this World Cup their “Change the Game” campaign picked up well. But their candidate’s performance left much to be desired. Dhoni’s helicopter shot has vanished in his chopper , Bhajji’s pepsi cans spin more than his delivery and the arthritic Billy Bowden never really showed his ‘Tedi Ungli’ to Ian Bell on a clear LBW dismissal against India . So while Pepsi relied on the players, the smarter players named Nike used a more tangible facet to relate to the common people – The Bleed Blue campaign. Using dramatic clips from real matches and a bunch of Indian superstars (can we leave Sreesanth here please?) promising to banish everything from pain to excuses, these 60 seconds come by as a pleasant sensation. Moreover other initiatives like facebook badges, handprints, create your ad et al has seem to relate well to the masses. So far it is a viral success.

Am I talking too much like a management guy here? What follows are some thoughtful insights from a group of guys holding whiskey glasses and watching the India-Pak match.Perhaps it was the fifth repeat of Blender’s Pride and the nth repeat of the ‘Bleed Blue’ ad which prompted my friend to withdraw all support from the campaign.well, let's come to the campaign again.........

Nike had a 7 year license agreement with "Sierra Industrial Enterprises "which ended in the year 2004. Instead of renewing the agreement, Nike launched Nike India as its subsidiary.Nike’s association with Indian cricket started in 2005 when they bought the kit rights from BCCI for around $ 27.2 million. In their esteemed and fruitful relationship with BCCI and Team India, the only blip was the 2007 World Cup debacle, where India lost out in the first round itself. Team India then went on to win the inaugural World T20 championship in 2007, haven’t lost a single test series – home or away, are numero uno in Test cricket. India winning the 2011 edition of the ICC World Cup was just what the doctor ordered for brand Nike in India.

Idea flashed to the marketer when they were trying to utilize this Cricket World Cup for their branding.Idea was, "the passion with which the fans of English Premier League teams like Manchester United come to stadium wearing red. Nike India wanted to create similar wave for blue in India." Tagline was taken from the concept "Blood, sweat and gloory" which every sportsperson in the country follow. Nike replace gloory with blue and this was the birth of "Bleed Blue" campaign.

This campaign is set to change the game for Nike in the sports footwear and apparel market. The campaign had initiatives like the Bleed Blue Pledge, where top Indian cricketers pledged their commitment to the game through their fearless attitude, passion and pride in representing the country.

ad created by JWT of Banglore, India.
60 second advertisement shows the pride, passion and fearless soul of Indian cricket brought to life through the voice of the elite atheletes of team India.During the 60-second ad the members of the Indian Cricket Team articulate the passion for cricket in this country, pulling back the curtain long enough for the viewer to witness how the game is played, loved and revered from the perspective of the athlete.

But "bleed blue pledge" is not only the voice of atheletes who played the game but it is the voice of the sports which exist inside the hearts and minds of millions of fans and players.This is the voice of the game."Bleed Blue Pledge" features many elite sportsperson like Dhoni, Tendulkar, Kohli, Yuvral, Srisanth, Gambhir and Zaheer who banish fear, pain and most of all excuses with great line from sachin...... Boundries are made to be broken. 60 second ad clearly show that they are not only representing Team India but they are speaking for entire nation who have become unified by a common love for cricket.

Rare: Corporate campaign become consumer language
Nike uses Scial and Broadcast media very effectively."Bleed Blue" became faviourate online search for cricket fans and the number of followers for the facebook page by Nike zoomed to 1.1 million.In just six months, the support from fans across India by imprinting their ‘handprint’ for the men in blue has reached a whopping 11.5 million and with over 1 million handprint on the Facebook page. Even cricketers are frenzied about the movement.

However, the idea got captured very well and the public accepted this expressionistic way. The 60-second television commercial as part of the campaign was telecast many times during the semifinals and finals, which itself cost the company crores. But the returns in terms of consumer recall of Brand Nike have more than made up for it.One billion hearts are synchronized at the same level. Cricket is a religion in India. One of the biggest emerging markets in the world has lost 75% of its productivity during the matches — this is not just a cricket match, it is nearly a war.”

Best part of the campaign that Nike very successfully linked the campaign with the indian consumer. They used facebook marketing, created website where user can go and create his own handprints. so Nike uses involvement marketing concept in a very well manner which led them success in the campaign while Change the game could not show very good game.
Adidas can ‘bring it on’ (their new campaign) and can claim that impossible is nothing. Reebok can be what they are (I am what I am campaign). But Nike is already bleeding blue by the billions.

Increased competition: Instant noodle market

2011-04-13T23:55:00.000-07:00

It may not reach the level of Pepsi vs Coke "Cola Wars" of the 1980s, but the sign of major skirmish in the making are clearly visible in India's food sector. The instant noodle market in India, which has long been dominated by Swiss giant Nastle with its brand Maggi, has been seeing a flurry of activity with new entrants stocking the shelves in recent months. Be it GSK's Horlicks Foodles, HUL's Knorr soupy noodles or ITC's Sunfeast Yippee, each is out to grab a share of the consumer's palate and wallet.

History of noodles:
instant noodles were first marketed by Momofuku Ando, founder of Nissin Food in Japan on August 1958, under the brand name "Chikin Ramen" and priced around 6 time that of traditional Japanese noodles and were considered as luxury item. In 1971, Nissin introduced the cup noodles in polystyrene cup, to which boiling water could be added to cook the noodles. A further innovation added dried vegetables to the cup, creating a complete instant soup dish.

Facts about noodles:
According to a Japanese poll in the year 2000, instant noodles were the most important Japanese invention of the century. As of 2008, approximately 94 billion servings of instant noodles are eaten worldwide every year. China consumes 45 billion packages of instant noodles per year – 48% of world consumption – Indonesia, 14 billion; Japan, 5.1 billion. Per capita, South Koreans consume the greatest amount of instant noodles, 69 per capita per year.

Instant noodles are not only popular with college students, they can also be an economic indicator. In 2005, the "Mama Noodles Index" was launched to reflect the sales of Mama Noodles, the biggest instant noodle manufacturer in Thailand.The index was steady following recovery from the 1997 Asian Financial Crisis, but sales increased about 15% on a year-to-year basis in the first seven months of 2005, which was regarded as a sign of an inferior good, one whose consumption increases as incomes fall. The theory was that the increase in sales of instant noodles, which are usually cheap, occurred because people could not afford more expensive foods.

Introduction to India:

Swiss giant Nastle introduced the noodles under the brand name "Maggi" in 1984. That time Indian eating habits were totally different and there was no sign for noodles to succeed in India and so most of big giants like HUL and ITC decided not to enter in noodle market.

Maggi came up with a tantalizing promise- ready to eat in just two minutes. The combination of convinient and taste proove to be potent. Over the years, other brands like Top Rammen from Indo Nissin, Ching's Secret from Capital Food and Wai Wai from CG Food also wooed the space, but all of them played a distant fiddle to Maggi and could not make a dent in it's 90% plus market share.

Current scenario:

The data shows that Maggi's share of instant noodles, on an all-India basis, across urban markets, has slipped consistently between December '09 to July '10. While Maggi instant noodles had a 90.7% share in December '09, the share dropped to 86.5% in July '10 on an all-India basis.A regional split of the data shows that Maggi's instant noodles' value market share has fallen across the east, south, north and west zones for the same period.
Apart from HUL and GSK which have positioned their noodles as 'healthy' snacking options targeting kids and mothers, others like Indo-Nissin's Top Ramen, Capital Foods' Ching's Secret and CG Foods's Wai-Wai , though around for long, are stepping up marketing efforts to take advantage of category growth. Besides, private brands like Big Bazaar's Tasty Treat and Aditya Birla Retail's Feasters are notching up share.

What made this possible?I think it is the combination of factors that led Maggi to loose its share. The indian consumer are lot more open to the instant food categories and demanding more choices now than he or she ever was before. And the current players have both, the brand name and the muscle power. All of them are known for their strong marketing power.

I personally believe that in long run ITC will be giving the toughest competition to Maggi because they are known for its "in the eye" kind of advertising campaigns and its strong distribution network(Bingo success storey is the evidence). ITC has planned to have 10% of instant noodle market share in 1 year which will help them to compete directly with Nastle's Maggi.And Sunfeast brand equity will help them out to grab market share quickely.

while HUL is playing on its Knorr brand which also has great brand equity and so it is also going to help in gaining market share fast. While advertisement being aired are quite heart locking, soupy noodles, "Kha ke piyo ya pi ke khao".

While GSK is battaling on its USP that Foodles is available only in multi grain and wheat varient and hense being promoted as having higher nutrition value compared to other popular brands. The main USP of Foodles is the vitamin packed health maker sachet that comes with the pack. And a beautiful advertisement with punch line, "Noodles without No" getting good response from market.
Looking the market trends and growth of noodles market in India, Big retailers Like Big Bazaar and Aditya Birla Retail also jumped to the battle ground with the private brands Tasty Treat and Feaster and in current scenario private lebels are hurting big brands more than anyone else.
Nastle ofc ourse in not keeping quietand has been widening the product range with new flavours and new varients. While its hot selling varients continues to be of refine wheat flour, Maggi too has jumped onto the health platform with whole wheat and multigrain offering. Nastle also realize that noodles are no more children product and hense redefine the target customer. Product is now being positioned as snacks for all age group.

Of course Nastle has taken all the necessary actions to retain its supremacy in Indian noodle market, but I don't understand that why big marketer like Natle gone through Marketing maopia that they didn't reposition maggi for long time and it has target same children for long time? Nastle should have smelled these Muscled giants (HUL, GSK, ITC etc)move and should have been proactive. They should have read the changing habits and changed demands of indian consumer.But of course in the fight of these muscles, consumer will get more variety and quality and may be in less penny.

Rural Distribution Exercise: new market and new channel to sale FMCG product

2011-04-04T03:29:00.000-07:00

Gone are the days when companies were focusing completely crowded area to sell their product. Initially all FMCG companies started selling their product in area of POP group >10k. Then companies like ITC and HUL who through various innovations started tapping lower population group. Due to increased competition, initially tapped markets has been saturated somehow. Now marketers are looking for new market where they can sell their products and increase the market share. And in the search of new customer where product can reach, marketer came to "Rural market" having population group even less than 5k and thinking of serving these markets directly. Now companies are hiring field staff in the area like Kalpa in Himanchal Pradesh, Mangaliya in Madhya Pradesh to sell products as diverse as shampoo, edible oil and even pizza.

I think, the moove has been triggered because of the combination of good mansoon this year,farm loan waiver, national rural employment guarantee act which all together lead to higher disposable income in rural market. Few more factor like low priced unit of Rs 1, or 2 or 5 and media penetration lead these companies to go so far to small villages. Now let's see how different biggies are approaching to this untapped vergin:

AMUL:

AMUL, the largest dairy brand,has kicked off it's largest distribution expansion excercise to take it's chiiled product like butter, paneer, ice cream and cheese to small towns and districts with population upto 5k. AMUL is expecting a minimum of 20-30%volume growth from these new markets and hence "Gujraat Cooperative milk marketing Federation", the owner of AMUL brand has decided to appoint business partners or super distributors to service these district on hub and spokes model. The cooperative will appoint 200 such super distributors who in turns will serve 3000 new towns and semi urban cities.

Unlike conventional FMCG product like soap or biscuits, distribution of such dairy product is more difficult because it follows 4 different distribution highway:

1- ambient product like milk powder and ghee

2- chilled product like butter, cheese and srikhand

3- frozen product like ice cream and paneer

4- fresh item like fresh milk and curd etc

and each highway requires specific storage, transportation and replenishment frequency.

For this purpose company is also creating a cold chain to transport and store product in closest to the market with require cooling infrastructure.

HUL:

In 2000, HUL collaboratedwith self help group to expand it''s rural reach under project "SHAKTI". It partnered women entrepreneurs called shakti ammas from rural areas of Andhra Pradesh and 14 other states by offering them opportunity for business. The objective was not to reach only but connect to local influencer.Today, there are 45,000 shakti ammas are on the board and taking product to across 1 lakh villages and over 30 lakh households every month. HUL soon figure out that shakti household who are now familiar with companies product range and operation can be used to reach villages less than 2000 Population group. Roughly one in two shakti household would provide a shaktimaan.

around 45% of HUL's turnover of Rs 17,524 crore comes from rural market,valued at around Rs 8,000 crore. Mainly products in the bottom line of pyramid finds takers in these areas. For cattering such opportunity HUL is about to hire 25,000 shaktimaan to sell it's product nearly in 1.5 lakh villages of population less than 2000. HUL has very clear game plan about its distribution model:

HUL will keep on servicing all areas with population more than 2000 directly through van operation or RS(redistribution stocckiest) while they will use some unconventional way like shaktimaan to reach population strata below 2000.

MARICO:

distribution is the key element of the strategy and that is why Marico is following two pronged approach to increase the availability and reach of its brand. Marico will continue to cover all market directly via hub and spokes model which falls under 5000 population strata and and have increased manning at the ground. for this purpose Marico has hired support staff of 220 in villages like kalod and rangwasa in madhya pradesh.

DABUR: "feet on street"

Dabur also looking forward for strenthening its rural distribution and for that they have already appointed 150-180 foot soldiers or feet on the streets and increased their stockist by 12% in rural and semi urban areas.these stockist will be served by superstockist and in this way dabur has sharpen its focus on rural areas. Dabur is targetting population group of atleast 3000 and will hire more foot soldiers if results will be enthusiastic.

Apar from soap, shampoo, toothpaste, butter etc there are some other players also who are trying to revolutionize the India rural and semi urban market.Domino's Pizza is one of them who is about to hire 2000 people over next one year and they will come from tier 2 and tier 3 citiesITC, NASTLE, GSK are other few player who are targetiing small villages to strengthen its rural reach.

Over the past few years, new growth for consumer goods companies in most categories has been fuelled by rural market. The pick up in mansoon this year has made up for the fall in demand due to last year's draught.

HIPPO: intense distribution network of Parle Agro

2010-11-13T01:37:00.000-08:00

Since i work for ITC Ltd, one of the best known FMCG company in India, i keep close eye on what is changing in marketplace. For the last 1 month during my visit to market, i have seen a drastic change. Earlier it was only BINGO from ITC Ltd and LAYS from FRITOLAYS which was available at most of retail and wholesale counter. One other name we can take is BALAJI in Maharastra, having very strong distribution network and pricing strategy. But today, if you visit a small retailer or a big wholesaler, you will find a good display of newly launched HIPPO from PARLE AGRO. Suddenly i saw advertisement of the product on TV.You can watch the video by copy and paste the following link-
http://www.youtube.com/watch?v=zOv7F_Tw4k

the ad clearly show that there is a war going on,mob smashing up a car,Adulterators are spoiling our milk and polluters our rivers, innocent child are forced to work. Everything is bad. But don't loose hope. First understand the reason behind all above mentioned activities.. It is hunger. Hey, society needs to learn a few profound things from the advertising industry and its dipstick surveys. Then think of a solution to all this violence and injustice.

There he … er … she … er … it … is! Is it a bird? Is it a plane? Is it Superman? No, it's a Hippo! And it is giving away snacks that are not fried, just baked. Finally, oil-free nirvana for a troubled world! Peace comes packaged in different colours, backed by a nice old filmi song and distributed by the hand (paw?) of a hippo.

Credits

Client: Parle Agro
Creative agency: Creativeland Asia
Chief creative officer: Sajan Raj Kurup
Executive creative director: Vikram Gaikwad
Creative director: Anu Joseph
Copywriters: Sajan Raj Kurup, Anu Joseph, Huzefa Kapadia
Client servicing: Jay Gala
Production house: Equinox Films
Director: Ram Madhvani
Post-production studio: Pixion
Media agency: OMD

The TVC is seen through the hippo's (brand mascot) view as he goes to every scene of crime, war or conflict, offering each of the involved parties some Hippo chips. Everybody happily obliges and takes a bite, and this is shown to resolve all issues. As the series continues, the voiceover goes on to say that the root cause of all evil in the world is hunger. "So please, don’t be hungry," it appeals. The song ‘Pyaar baat te chalo’ (Keep spreading the love) which doubles up as the background music, plays a pivotal role in helping the TVC communicate its message.

Background-
The maker of Frooti and Appy entered into Rs. 6500 crore branded snacks market with the launch of HIPPO.Incidentally, Parle Agro's R&D team tried over 50 flavours before launching the final five that has been introduced in the market.
Each variant will be priced between Rs. 5 and Rs. 10, initially. The new brand is being manufactured at Parle Agro's plant at Vatwa in Gujarat. The company also plans to pump in funds to increase its manufacturing capacity, distribution network and market infrastructure.

Distribution efficacy and expectation-
Hippo being distributed throughout the company's existing distribution network for confectionery, which was created keeping in mind the entry into the snack category. The brand is being rolled out from Maharashtra in the western region and will soon be available nationally. Parle Agro has created a good confectionery distribution network and good holding in market due to confectionery item.
if i trully write about launching of HIPPO, I'll say that this is a successful launching. Parle Agro is successful in placing there snack at most of the retailer and wholesaler.
Company successfully arrenged hanger and stand for everyone taking upto particular amount to place the HIPPO. since company arrenged stand and hangers, there concept of visibility also came to realisation. now they have a separate stand for HIPPO.
now, PLANOGRAM of any product while doing display is important to success. and if you roam around market, you will find out that all display has been done in a particular brand order.
so, in a way Parle Agro has utilized it's distribution network very cleverly, placed product to everywhere in a way that it is visible to everyone.

Future challenges-
HIPPO has been reached to villages within a few month of it's launching. but still i am not sure that it would be able to continue it's agressive stratrgy. again, competitor are really very very strong, having very great distribution network along with acceptance and market power.
If we take example of BINGO of ITC Ltd, which work on theme of Availability, Visibility and Freshness (where visibility and freshness are important part of distribution along with increasing availability), running 50% extra scheme currently, best in taste and also has been widely accepted by customer,has developed such a great distribution network over more than 100 years, has reach from metros to small village panwala, tapari or if we take LAYS which work on concept of Availability, Acceptability and Affordability and also widely acceptable throughout, has great distribution network developed over period of time, has complete coverage on particular channel of distribution network.
For Parle Agro it will be very difficult to crack this huge distribution network of ITC Ltd and Fritolays. what will happen in future, no one knows till now. But if they have to break these two giants, they need to be very careful in market place about there service, scheme, pricing and distribution strategy. let us hope for the best.

In Practice:Roadblock

2010-11-12T02:31:00.000-08:00

The very first roadblock to be attempted on Indian television was way back in 1994 when a small fire extinguisher making company decided to use 9 different commercials to launch its diversification into keep fresh kitchenware. A creative indulgence that a smart media planner chose to capitalize upon by acquiring the telecast rights of a full-length feature film and airing only these commercials in every break, so that the viewer got the whole message about the range at one go.
Term is used when an advertiser buys up all the advertising on a channel for a given length of time like a full day (vertical roadblock), or across a band of channels at a particular time, say an hour (horizontal roadblock), thus preventing any other advertiser from being present at those times.

Vodafone-

International mobile communications group Vodafone collaborated with STAR India to launch an unprecedented 24-hour nationwide re-branding campaign on all commercial airtime across the Star India network starting Sept. 20, 2007 for mobile service Hutch Essar, which is being renamed Vodafone Essar following Vodafone's purchase of a controlling interest in Hutchison Essar, spend an upward Rs. 10 crore.
Vodafone ran TV commercials, transition bumpers and contest spots to promote the Vodafone Essar brand from 9 pm on Sept. 20, to 9 pm the following day to potentially reach 63 million viewers in five languages of Hindi, Tamil, Bengali, Marathi and English through 13 channels including Star Plus, Star One, Star Gold, Star Movies, Star World, Channel [V], Star Utsav, Star Vijay, Star News, Star Ananda, Star Majha, National Geographic Channel and History Channel to build awareness in the shortest possible time.

Vodafone’s roadblock initiative with Star brought in 90-95% brand recall and opened up a new avenue for advertisers wanting to make a splash.

Airtel way-one brand, one mall

In August, 2009, Airtel came out with a first-of-its-kind deal with RK Cineplex — a ‘branded’ mall in Hyderabad. It guaranteed exclusive advertising and naming rights to Airtel for two years. The RK Cineplex in Hyderabad’s up market Banjara Hills has been renamed “Airtel RK Cineplex”. The deal disallowed other products from any static branding in between. The complex is home to Airtel’s mobile, broadband and DTH kiosks and 18,000 sq. ft of exclusive Airtel branding that caters to 5,000-7,000 visitors a day. With Blackberry and DTH service inquiries on the rise, the mall itself functions as a retail store for the telecom giant

CADBURY

Introduced one of its commercials for Dairy Milk, “aaj pahali tarikh hai” through three-day roadblock advertising on MTV in July 2009.

HUL-
Hindustan Unilever has blocked a whole day on Star India’s entire network of channels. Brands of Unilever alone will be advertised on Thursday across Star Plus, Star One, Star Gold, Star Utsav, Star Movies, Star World, Channel V, Star Jalsha, Star Pravah and Star Vijay. Lifebuoy will lead the pack. Though roadblocks cost between 100% and 200% over regular advertising rates, the popularity of the concept has been on the rise among large advertisers.
Unilever embarked on traffic plans of its own, blocking the Star roads on the 17th, the Zee roads on the 24th and the ETV ones on the 29th. Every roadblock so far has been for a brand, these were the first ever for an advertiser, across several brands
Lintas Media Group met 240 housewives and working women across four cities, all in the age group of 15 to 44 years, the day after the Star and Zee network roadblocks. We primarily checked out whether recall levels of advertised brands were higher than normal , and whether viewers noticed anything different about their viewing experience that day. Were any extra special brand benefits understood beyond achieving higher recall?
HUL's two-day roadblock cost the company a fourth of Godrej's overall advertising expense.
On an average day, the Star Network enjoys a 24% share of total Unilever GRP’s , while the Zee Network garners another 19%. On the roadblock days, this shot up to 55% for the Star Network (ensuring, we hope, an excellent bonus for Uday Shankar and his team), and 47% for the Zee Network (joy for Joy!) . Overall average daily GRP’s for the company doubled from 860 to 1650.
79% of the women we met did not notice anything different about the day’s viewing. The ‘shock and awe’ factor was therefore limited to the media planning community, and rightly so, since that did not appear to be the objective of the exercise. Recall levels for Unilever brands were however an outstanding 40 to 50% of all brands recalled. (In a day after recall exercise, not-advertised brands will also inevitably enjoy a baseline recall level). Average recall levels per HUL brand ranged from 7 to 16% of the women we met. Perhaps there were specific brand objectives that were met as well.

IDEA-

On June 30th last year, Idea Cellular made a quiet attempt to win over its customers without upsetting the traffic cops. A horizontal roadblock from 9 to 10 pm across 30 national news, movie, music and entertainment channels announced the start of “what an idea, Sirji!” Prior to that, newspaper ads and teaser tv commercials promoted the new campaign like a movie release. Spontaneous awareness scores within a week of the campaign breaking with the roadblock were the highest ever for the brand.

Volkswagen ‘Road-block’ for India-

The date was 11th November 2009, when I started reading the Time of India, front full page ad by Volkswagen, 12 pages out of the 22 had ads for Volkswagen. Then over and over again as each page was turned on there was only Volkswagen in the newspaper that day. I was confused & in awe only because of the gravity of the money that had been spent by Volkswagen for the day, 11th November 2009. This was a 40 crore campaign by Volkswagen India, who have also come up with a Television ad recently, showcasing their brands.
The media agency that has created the roadblock is MediaCom.
The print ads were showing the fact that the company is trying hard to indianize itself, with the front page ad showing the pronunciation of the word ‘Volkswagen’ in different Indian regional language. The print ads also introduced and appraised readers to the various Volkswagen brands that are currently available (Passat & Jetta) & the ones that are lined up for India (Polo, Beetle, Touareg). The media spend will include print, TV, outdoor & the internet. Expect the internet & outdoor impact to be similarly innovative as their creative agency is DDB Mudra Group.
The 40 cr. question?
is whether this will boost their numbers, which were poor in Oct’ 2009. They operate in the very niche top end of the business, which accounts for less than 2% of overall car industry sales. India is touted as one of the growth markets for Volkswagen and they are not that far behind Mercedes or BMW in their numbers. April to October sales show that they are only around 700-900 cars behind.

My Name is Khan-
Like the big advertiser HUL, Cadbury India, Vodafone, Airtel etc, “My Name is Khan” is the first movie to implement roadblock strategy for promotion of the movie. The roadblock, which will be the film’s three-minute trailer, will be on air on all Star India channels. "This kind of roadblock has never been done before for a film. About eleven Star India channels including Star Plus, Star One, Star Gold, Channel V and Star Pravah, will telecast a three minute trailer of the film. Movie is produced and directed by Karan Jauhar is set to release in Feb, 2010.Fox Star Studios ( a production and distribution company, is a joint venture between Twentieth Century Fox and STAR) has acquired the worldwide distribution rights for this film for around Rs 80-90 crore for a 15 year period. It covers all rights except music, which has been bagged by Sony Music.

ITC-
Vertical roadblocks can take the form of ‘day associations’ to work wonders for a brand and its essence, thus delivering impact not just by hogging up all the inventory, but also by fitting in with what the brand stands for. Bingo worked with MTV to sponsor April fool’s Day this year, turning it into a Bakra Din, so much in character with the brand’s irreverent whacky persona. All commercial breaks were exclusive to Bingo of course, but beyond that the content itself was recreated to showcase the brand and its ‘no confusion, great combination’ message. Fake cricketers, spoofing VJ’s, all paid ‘tribute’ to the brand as ‘foolishly’ as possible!

Nokia-

If anyone knows how to make a vertical roadblock work, we have to say it’s MTV. They associated with Nokia on Independence Day last year, promoting the launch of the new N96 through Freedom of Expression. Not a single normal commercial was used. Instead the entire day was peppered with celebrity vignettes branded by the N96, teasers showcasing the features of the product, interactive scrollers offering special mobile downloads of the national anthem, and so on.

now, it is becoming the trend in advertisement to adopt roadblock strategy for faster reach and better effectiveness. media person are also contacting big advertiser for such activities. big advertiser are adopting this way for faster reach, like Vodafone did it successfully and spread word of mouth that hutch is vodafone now. i hope that we will see such campaign frequently in future.