Marketing Pajamas

Old Monk. Yes, the Buddha that everyone is in love with.

Ask any chugger of this beautiful brown liquid in a unique square bottle, why this drink is apart from any other booze in the world, and they would tell you that it is not the drink. It is the stories attached to the beautiful high this drink gives.

Here is a post that talks all about it : http://bit.ly/11qAaUG

However, I am not here to talk about what this drink does, or how good it is. I am here to blare a horn about a glaring hole in the strategy of this product which ‘might’ lead to its downfall.

Here is a recent article in Livemint which talks about the decline in the sales of Old Monk, and McDowells No. 1 overtaking it : http://bit.ly/11MwOg9

As the post informs , it has lost so much ground that the venerable label sells less than one-fourth the volume of McDowell’s No.1 Celebration rum, owned by United Spirits.

Now, I have tasted both, and I know better than the stats to know which one is better. So why is it that our beloved Old Monk is losing out on sales? After all, it is the only Indian spirit brand to figure in advertising guru Ian Batley’s list of potential Great Indian Brands, which could tap the world market.

The major issue is of outsourcing its distribution to third parties. While I can understand that high distribution costs would have prompted such a move, but with such outsourcing comes the need to monitor them strictly. Old monk has failed to do that. McDowells and Old Monk are at the same price range.However,  while McDowells (Owned by United Breweries) has its other brands, and good trade incentives push it through the grilled window of the liqour shops, Mohan Meakin Brewery, due to its third party distribution, has 1. lesser incentives to over. 2. lesser control over the execution. This is the reason why you would seldom find Old monk on the shelves of the shop. When you ask for it, it comes out of a carton stacked somewhere in the shop.

Since the time it was launched, this brand has been a king in the rum market. So it had nothing to fear about. But with the proliferation of foreign brands, and the competitors becoming bigger & smarter, Old monk needs to understand that it is not just about the taste anymore.

Trying to understand competitor trade incentives, and countering them should be paramount in Old Monk’s strategy.

Now lets try to understand their marketing strategy.

Amazingly, This Mohan Meakin Brewery Rum from the Ghaziabad-based company hasn’t spent a single rupee on advertising ever since it was launched on 19th December, 1954. (Source: http://bit.ly/160zT0l). Strangely, they dont’ even have a website! All the content available on the net, is created by fans.

Here is a Fan Ad made for the Old Monk, probably the only one on the net:

Looking at the rum market in India, there are only three major player : Bacardi, Old Monk and McDowells.

While Bacardi is considered to be a premium drink for the upper class, McDowells is positioned for the lower segment of the market. Old Monk, however, is in an ambiguous space. While it is affordable, the taste appeals to all – be it rich or poor, While people get hooked to the taste at a younger age (usually during college days), they graduate to other drinks later on in life. As the price of the bottle is in the lower range, it caters to all segments. Both to the price sensitive, and the brand loyals who have done well in life, and can afford better ones. However, even though they are brand loyal, you would find Old Monk at the bottom of the list in any official venue or place. The reason being, because of its price, it is not considered good enough to feature there. Of course, there would be brand loyal who would ask for it (and get it).

One good thing that Old Monk has done, is tap into the loyalty of its customers. It has introduced four different variants  basically different bottles for the monk. We have the classic – the squat bottle that we know of. Apart from this, there are 3 more variants :

Deluxe – Priced at Rs. 220/-, it is the same bottle with a different name.

Gold Reserve – Price at Rs. 270, the bottle is tall and slender. This bottle is a more mobile version as it is easier to put it in a bag, and carry it. Also, there seems to be a little variation in the taste though the spine remains the same.

Supreme – Shaped as a Buddha, this bottle seems to be more of a collector’s edition. It is priced at Rs. 380/-, and is targeted at the people higher up in the order, in the society.

I believe, word of mouth is one of the strongest medium to spread the word for a product who cannot show its ads. While the other brands use surrogate advertising, Mohan Meakin might not be into it because of budget constraints.The new digital media gives the option of cheap and customized advertising to the makers. It gives them a platform to connect with its lovers.

However, we are talking only about the Indian Market. Given the popularity that this small Buddha has, it might very much be possible that Mohan Meakin might be concentrating on international exports too. However, that is not an explanation to let their share of the Indian market go.

With the Indian Superbowl (Indian Super League) on, many brands have seized this TV watching extravaganza as an opportunity to revamp their image or come up with new campaigns to keep themselves fresh in the mind of their audience. One such brand is the Mahindra Group.

Mahindra Auto has come with with an image revamping campaign – Live young, Live free. Many would have caught their new campaign TVC on the idiot box. Here is the full video :

Now since the time I have seen the 30 sec ad (and later the full version), I have not been able to stop humming it. True to its theme of young blood and freedom, Interface communications( the creative agency) has delivered a catchy young tune in sync with their potential audience. The young SUV loving blood who loves measuring the road, no matter how bumpy.

No wonder  the tune refuses to leave my head.

Intentional, or unintentional, the TVC has done its work. Broke the clutter. Incidentally, this is also one only TVCs of Mahindra featuring all the Mahindra SUVs.

Come to think of it, the creatives might actually have done something pretty smart here, leaving an audio meme in their TVCs. You can just catch a hint of that song you know, in those jingles. Makes you listen to it more and more.

The best use of audio memes has been done by Bajaj when it launched its Bajaj Pulsar 220cc with its completely revamped ‘Hamara Bajaj’ theme.

This ad, however, has not picked the song or their lyrics. they have just taken the spine, and laid their own skeleton on top of it.

For creative agencies, it would be a good idea to know the taste of what their target audience listens and watches to understand what kind of visual cues or TVCs they should be creating. It would be easier to create audio memes like these. reminds me of the hidden satanic messages of the Stairway to Heaven records. :)

Atleast creatively, the campaign hits the nail on its head. Does this image make over translate to sales remains to be seen. A lot would depend on the kind of trade promotions and BTL campaigns that Mahindra would do as a part of this campaign.

October 2014 would be known as the month of the E-commerce wars.

Too much has happened this month to go unnoticed:

While there is still around two weeks to go, the following has already happened this month:

Snapdeal is poised to raise another $600 million to $650 million from investors

Amazon has got into talks in acquiring Jabong

Flipkart came up with the first ever big billion sale in the world

Kishore Biyani’s Future group tied up with Amazon

To say the least, the E-commerce market has just begun its inroads into the lives of the middle class consumer without the concerns & fears previously associated with the medium.

Though October would mainly be remembered for the Big Billion Day, and the war which was fought out in the open by its competitors. With the Amazon Diwali Dhamaka Sale just concluded, this post analyzes the current status of the market, and where it is headed.

Where it Began

While Ecommerce in India was started by Infibeam, it truly came to force with flipkart. The company, like  Amazon, started off with selling books, and then soon expanded their categories to sell anything and everything under the sun.

The first two pointers mentioned above, can be looked at as an aftermath of a chain of events which was started back in June 2014 when Flipkart, the king of E-commerce in India, announced a funding of a billion dollars which shot up its valuation to $7 billion. A day after this, Amazon, which had till then, already started to dig its fangs into the Indian E-commerce Pie, had its CEO announcing an investment of $2 billion into the Indian Market.

Both the timing and the amount clearly shows the intent and the aggressiveness of the parties when it comes to showing who is boss. While the two players were hustling, an underdog suddenly emerged to make the game even more interesting – Snapdeal.

Snapdeal announced that Ratan Tata had invested an undisclosed amount to see it grow. In September, Alibaba got into talks with Snapdeal to enter the Indian Soil.

This was followed by huge marketing spends from all parties, with innovative campaigns being spearheaded by Flipkart. They were the first to try out flash sales with Xiaomi selling 10,000 mobile handsets in under a minute. Amazon aligned its operations and relied on positive WOM through social media, while Snapdeal kept up its low key marketing but better pricings to heat the war up.

Then came September when  Flipkart, which had had a successful run with its flash sales with xiaomi decided to do a Kishore Biyani when it introduced the big billion sale to India – the online version of the black friday, and the first time any E-Commerce player anywhere in the world had decided to do something of this magnitude.

What followed that day on October 6th, was both a mix of customer Delight, Anxiety and a lot of comedy on Social Media.

October 6th

 October 6th would be remembered as the day E-commerce finally came of age. This was the day when Flipkart announced that it would be having the biggest sale in E-commerce History – A day when it would be making a sale of a billion dollers. We don’t know whether it was a stunt which they wanted to pull for their investors, or to leave a brand retention like never before for its consumers, but the day was one worth looking back to.

From a marketing perspective, Flipkart did not leave any stone unturned. From TV, Print, Digital to Radio, Flipkart had all the consumer touch points covered to let the world know of its big billion sale.  They had separate ads for the digital medium, with Social Media influencers talking about it, and people speculating what it would be like on that day.

It promised to be bigger than anything that anyone had ever seen. The tone and builtup to that day was enormous, so much that even the ones who had never really believed in online shopping wanted to try it once.

 Flipkart had already run the flash sales for Xiaomi phones and had received tremendous response. Hence they knew that they needed to ramp up their infrastructure to meet up with the demand. Also, for sale of this magnitude across categories, they needed to have at least

However, Flipkart did not anticipate what people usually do when they are looking for online discounts – they research.

One day before the sale, rumours of Flipkart increasing their prices to reduce on the day of the sale surfaced.

The day started with this:

Snapdeal, with just one front page ad, was able to piggyback on the huge marketing spend of Flipkart, and divert customers to its website.

While the day had started, Flipkart had worse to come. It seems that their projections were wrong, and they had heavily underestimated the demand by the customers. The sale began at 8AM, and by 10, people started complaining of the site not loading, discounts not being offered, items available at other sites at a much cheaper rate, Order cancellations. The servers were unable to take the load, and their were technical errors by hoards. Even after doubling its workforce, Flipkart had not managed to keep up with what was clearly a wave of discount hungry Indians going for the best prices.

To make matters worse for flipkart, someone bought http://www.bigbillionday.com domain, and redirected it to http://www.amazon.in.

By 2PM, the servers had crashed, though the sale was officially announced over by 6PM.

Flipkart received major PR damage that it has suffered due to the one day full of glitches. The Bansals gave an open letter apology for the mistakes made.

Even after so many glitches, Flipkart had managed to make INR 600 million. Also, just by that one front page ad, Snapdeal had very intelligently managed to get similar numbers and the same amount of revenue. This goes to show how smartness can outwit muscle. Also, the glitches by Flipkart helped in diverting customers to rival websites.

Amazon Diwali Dhamaka sale

  Amazon is one player which has one of the strongest technological backings in the eCommerce space, thanks to its global parent company. When it comes to logistics, technical infrastructure and customer satisfaction, Amazon remains unmatched as it has already learnt from its global counterparts what the Indian players are learning now.

It ran a week long Diwali Dhamaka Mela (Where SnapDeal again trolled its competitor with the same strategy as before) and gave 50% discounts on most of its items.

Having burnt its fingers once, Flipkart did not provide any offers during this period except taking a dig at its competitor by buying the domain diwalidhamaka.co.in 

Revenue numbers are yet to come, but there have been very smooth operations without any glitches.

What it means for the Indian E-commerce Industry

It is an amazing feat for two players to sell products worth Rs 1,200 crore in 10 hours for an industry that only a few years back had sales worth a few thousand crore per annum. Barring the issues faced that day, our leading e-commerce players proved in one day that demand can be created and that there are a great deal of customers willing to purchase online given the right circumstances.

Flipkart’s Big Billion Day showed the potential of e-commerce in India, of course. But that potential is still a long way off.

India represents a $3.5 billion market, growing at approximately 60-70 per cent every year. It represents less than 4 per cent of the total retail market.  it is expected to reach $6 billion in 2015, an increase of 70 per cent increase over 2014.

Inside the Bollywood Formula

IBM is using Social Sentiment Index (SSI) to aggregate and gauge public opinion from a range of social media. Collected seven lakhs of data points across all social media channels like Facebook, Twitter, Pinterest,  Film-Critic Reviews etc.

As Indians are spending more, alternate payment systems like fund transfer, credit, debit and prepaid cards are making their way into the ecosystem.

This not only gives more flexibility and convenience to the customers but is also a welcoming change for companies looking for increasing the spend propensity of its customers. 

E-Commerce Goes Global

Everyone in the U.S. knows Amazon, but not everyone knows Alibaba or Flipkart.

In the next five years China and India are expected to see faster e-commerce sales growth over the next five years than any other country, From the infographic, a firm that helps companies drive personalized shopping experiences across multiple e-commerce channels. That means bigger things for Alibaba -- the e-commerce behemoth of China that currently oversees more transactions than Amazon and eBay combined – and Flipkart, the e-commerce giant of India.

Take a look at the infographic, which was produced by Column Five Media, below to see where e-commerce is growing the fastest across the globe and which companies are leading the charge.