MARCH 2011

- Monthly Newsletter

INSIDE THE ISSUE

Page 2

NATIONAL BRANDING: - Is it all about encouraging tourism?

Page 3

THE ECONOMICS OF MARKETING FRESH FRUIT JUICE IN INDIA

Page 5

CREATE YOUR UNIQUE SELLING PROPOSITION (USP)

Page 6

An unprecedented growth story:-

THE BOTTLED WATER INDUSTRY IN INDIA

Page 7

TEN STEPS TO REVITALIZE A BRAND

build reputation, encourage foreign direct invest-

ment, increase tourist arrival, create internal pride, or

be a support for exports from the country. Antonio

Marazza of Landor Associates, says “A country brand

is more than just a logo. The purpose is to attract and

win customers from around the world.” It is the way a

country is perceived by the audience.

The major emphasis is given to improve the nation’s

image internationally, but equally important is to tar-

get nation’s own people. This is because, a nation is

not just the land outlined by its borders, but also

through its individuals. You can understand by this

why government spends in broadcasting ‘Incredible

India’ even inside the country.

Advertisements which show scenic ads and tourist

destinations in the country are mostly travel oriented.

Advertisements like ‘India Inclusive’ are targeted at

companies and governments who can be the poten-

tial investors or customers of India Inc. Let’s focus our

attention on this branding for some time.

Have you ever heard of IBEF? Can you recognize after

looking at the image, if you couldn’t earlier.

I’m sure some of you might have referred to the re-

ports published by IBEF about the status of different

industries in India, while preparing for Industrial

Awareness sessions during second term or while pre-

paring Strategy report a couple of days back.

“Incredible India”, “India Inclusive”, “India Shining”.

What are these slogans ? What is the objective of

these advertisement campaigns? Is it one and the

same? No! The objective of these three slogans is

completely different.

‘Incredible India’ is the slogan being used by Ministry

of Tourism to promote India as a destination for trav-

ellers. ‘India Inclusive’ was the campaign by Confed-

eration of Indian Industry (CII) during 2011 annual

meeting of World Economic Forum at Davos, Switzer-

land. These two slogans are part of ‘Nation Branding’

of India. The third slogan ‘India Shining’ though

started with the objective of promoting India interna-

tionally, had been used as a political campaign by

Bharatiya Janata Party (BJP). This received wide

spread criticism for using taxpayer’s money for pro-

moting political gain.

'Branding' is how an organization communicates, dif-

ferentiates and symbolizes itself or its products to its

prospects. ‘Nation branding’ is doing the same, but to

a whole country. Remember your first week of

classes in Planet-I? From Kotler: What is marketed?

Goods, Services, Places, blah blah blah.. Nation

branding comes under marketing ‘places’.

The objective of nation branding is multi-pronged; to

MARK - AVENUE

DO YOU KNOW the origin of company name “PEPSI” ?

It once claimed to contain pepsin. Pepsi's creator, Caleb Bradham, claimed his cola contained pepsin, an enzyme crucial to digestion, so Pepsi allegedly aided digestion.

Page 2

NATIONAL BRANDING :- Is it all about encouraging tourism?

- Srinath Akula

costing as high as 18Rs? For a

conservative middle class

south Indian who was familiar

only with “Naranga Vellam

and Sarbath” (read Nimbu

Pani) and occasional road side

sugar cane juice/mosambi juice, 18 Rs

was way too costly. I remember during

my office days in Bangalore, Pune and

Chennai, I could clearly see the visible

difference in juice consumption pattern

of my peers (no, I am not referring to

the “hot” consumption) where most of

us started stocking family packs of

Tropicana, Real etc. That was sup-

posed to be the “IN” thing. Also, most

of us were being health conscious as

“Uncle Ji, Ek Tropicana Litchi dijiye..!”

For every visit up the hillock and down,

one tetra-pack of Tropicana/Real or

Saint..!! That is the thumb rule being

followed by many of us here in Planet-I.

In the last edition, we talked how Planet

-I and India as a whole is noodling too

much. I feel that another tectonic shift

in our food consumption pattern has

been characterized by an increased off-

take of fruit juices. Yes, the beautifully

tetra-packed Apple, Grape, Mango, Or-

ange flavored so called “fresh fruit

juices” marketed by the FMCG behe-

moths.

Initially I used to feel why on earth is a

juice packed in a meagre 200 ml pack

well with the added advantage of mix-

ing it with Vodka whenever required J

Yeah, Smirnoff with Tropicana orange

totally rocks..!

Coming to the point, as per a study by

McKinsey & Company, the Indian food

market is poised to grow to $ 310 billion

by 2015 and $ 344 billion in 2025 – at an

approximate compounded annual

growth rate of 4.1 per cent. Currently,

India ranks second in fruit production and

IBEF is a public-private partnership

between the Ministry of Commerce,

Government of India, and the Confed-

eration of Indian Industry (CII).

The primary objective of the trust is to

promote and create international

awareness of the Made in India label in

markets overseas and to facilitate the

dissemination of knowledge of Indian

products and services.

This trust prepares and publishes re-

ports on the status of Indian industries,

promotes the brand of India Inc, pub-

lishes newsletters like India Now, In-

vest Now, conducts national and inter-

national events to promote ‘Brand In-

dia’.

To name a few, it organizes ‘Made in

India’ show, runs different campaigns

like ‘India Everywhere’, ‘India Inclusive’

every year across the globe .

Zooming out to the international

arena, many countries across the world

do nation branding. To cite a few;

'Korea Sparkling,' 'Definitely Dubai,'

'Amazing Thailand', 'Malaysia, Truly

Asia', and ‘YourSingapore’. And un-

doubtedly world expo is a wonderful

arena for nation branding. Jay Wang

from LA says “You can find out how

countries want to portray themselves

to the rest of the world. In other words,

how they brand themselves. It’s like an

(expensive) beauty contest for na-

tions”. Expo 2010 organized in Shang-

hai, China is one such event. 192 coun-

tries registered to participate and

around 73 million visitors visited the

expo. Many countries had exclusive

National pavilions, showing their cul-

ture and development of urban life.

The government supports us in the

international arena by promoting the

nation as a brand and presenting a

positive image of the Industrial face of

the country.

To better understand this, I'd recom-

mend you to see the short films com-

piled by IBEF at http://www.ibef.org/

brandindia/indiafilms.aspx

Page 3 MARK - AVENUE

THE ECONOMICS OF MARKETING FRESH FRUIT JUICE IN INDIA

-Kiran Krishnan

third in vegetable production in the

world. Consumer taste & preference is

one of the major drivers for this indus-

try. Increased health consciousness,

high disposable incomes, changing

demographics and lifestyle are driving

demand for quality fruit products that

can be consumed at ease.

This is evident from the huge rise in

demand for ‘pulpy’ beverages as com-

pared to carbonated beverages, in the

last few years. The fruit-based bever-

ages market in India is divided into

three segments – fruit drinks, nectar

and 100 per cent juice – and is getting

increasingly competitive. Parle Agro’s

Frooti, Coca- Cola’s Maaza and Pep-

siCo’s Slice are the three major brands

in the fruit drinks space, which is the

largest chunk of the fruit-based bever-

ages category. It is not a coincidence

that all of them are mango flavoured.

In the nectar and 100 per cent juice

space, Dabur’s Real controls half the

market, while Pepsi’s Tropicana has

over 30 per cent share.

But ironically, in this 2nd largest fruit

growing country, hygienically packed

fresh fruit juice is still a middle class

luxury. India grows 70 million tonnes

fruit annually, of which mango and

banana make up 50% share. And con-

sequently India ends up importing

most of the other fruit concentrates.

This exposes the manufacturers to the

fluctuating commodity prices and the

only way out is to stock up the concen-

trate reserves which is also possible

only to a certain limit as it severely

cashes out your working capital. An-

other important cost driver is the pack-

aging costs. For every 15 Rs 200 ml

pack, the packaging costs sums around

to 4Rs. But this cannot be given away

as safe packaging especially in hot/

humid conditions is very critical for the

safe consumption. Transportation

costs in covered trucks also add to the

logistics costs unlike other bottled

juices. Moreover, the retailers won’t

keep the packs even for one extra day

after the shelf life period. Another solu-

tion would be to use bottles which can

re-filled and recycled. However this

requires extensive distribution network

which excepting Coke and Pepsi, no

others can exploit currently.

The technology of fruit processing and

preserving the taste is only getting

continuously evolved and thus limits

the challenge to taste. And this is pre-

cisely why most of us still cherish the

road side fruit wala’s fresh nimbu/

masala juice.

More surprisingly, there are not

enough technologies developed or ex-

ploited for exploring the feasibility of

bottling sugarcane juice/coconut water

etc.

Even though, Lemon flavoured juice

drinks exploded onto the juices scene

in 2010 with the launch of brands like

Nimbooz by 7-Up (PepsiCo), Minute

Maid Nimbu Fresh (Coca-Cola) and

LMN (Parle Agro) accounting for 10%

of off-trade value sales of juice drinks,

bottled nimbu pani is a distant second

favourite when compared to the

mango market share which is quite

surprising for the taste of Indian con-

sumers.

These fresh juices are not marketed as

thirst quenchers but as health drinks.

However, with more serious efforts in

technology up gradation, indigenous

development of fruit concentrates,

development of green and sustainable

packaging solutions, Indianising the

flavours etc, these players might be

able to bring down the overall cost to

the consumer and it would be only then

that they would be able to further cash

in on the Indian middle class explosive

growth story.

Until then, let the roadside juice waala

smile..!!

Page 4 BY MERCUR—I

DO YOU KNOW the origin of name “Apple Computers” ?

It was the favorite fruit of founder Steve Jobs. He was three months late in filing a name for the busi-

ness, and he threatened to call his company Apple Computers if the other colleagues didn’t suggest a

better name by 5 O’clock.

The factor or consideration presented by

a seller as the reason that one product

or service is different from and better

than that of the competition.

Brand Positioning is the process by

which marketers try to create an image

or identity in the minds of their target

market for its product, brand, or or-

ganization. It is about offering differ-

ent from, and placing the idea more

valuable than competitors in the minds

of customers. Hence it is imperative for

distinguishing offering from everybody

else's.

In order to pick out the product or ser-

vice USP, requires some hard soul-

searching and creativity. One way to

start for getting basics right is to ana-

lyze how other companies use their

USPs to their advantage. This requires

careful analysis of other companies'

advertisement and marketing mes-

sages. If it says about what they sell,

not just their product or service charac-

teristics, one can learn a great deal

about how companies distinguish

themselves from competitors.

For example, Charles Revson, founder

of Revlon , always used to say he sold

hope, not makeup. Some airlines sell

friendly service, while others sell on-

time service. Neiman Marcus sells lux-

ury, while Wal-Mart sells bargains.

Here's how to develop a Unique Selling

Proposition (USP) and use it to power

up product sales:

1) You are also a customer i.e., put

yourself in your customer's shoes.

Remember, price is not the only reason

customers buy. It is often learnt that

entrepreneurs admire or fall in love

with their product or service and forget

that it is the customer's needs, not

their own, that they must satisfy. Put

your focus on business daily operations

and also carefully scrutinize what cus-

tomers really want.

2) Learning is important. Consumer

buying decision and what motivates

their behavior has to be known.

Effective marketing requires the owner

to be an amateur psychologist. One

need to know what drives and moti-

vates customers. Initially you can go

beyond the known demographic pa-

rameters of customers, such as age,

gender, race, income and geographic

location that most businesses collect

to analyze their sales trends.

3) Know your value. Uncover the real

reasons customers buy your product

instead of a competitors.

As your business grows, you'll be able

to ask your best source of information:

your customers. For example, the pizza

entrepreneur could ask them why they

like his pizza over others, plus ask

them to rate the importance of the

features he offers, such as taste, size,

ingredients, atmosphere and service.

Many retailers routinely drop into their

competitors' stores to see what and

how they are selling.

Well, successful business ownership is

not about having a unique product or

service; it's about making your product

stand out even in a market filled with

similar items. Hope these give a start-

ing point for you to create a unique

selling proposition for your business.

Whatever, one must choose the right

position, right path and execution.

For now, get your minds towards the

ideas which will be your kismet.

Page 5 MARK - AVENUE

CREATE YOUR UNIQUE SELLING PROPOSITION (USP)

-Harish Kumar Raju

“Bottled water”, once deemed to be

foreign to the Indian context & consid-

ered as the luxury of the rich, is now

one of the fastest growing markets in

India, with a CAGR of 25% (highest in

the world) since 1999. As of now, the

packaged water market is approxi-

mately equal to $445 mn.

The per capita consumption of mineral

water in India is 3-4-liter compared to

the global average of 25 litres. In com-

parison to global standards India's bot-

tled water segment is largely unregu-

lated. According to a national-level

study, there are more than 200 bottled

water brands in India and among them

nearly 80 per cent are local brands.

On close scrutiny, the above data re-

veals that this sector is far from being

stagnant; it’s going to get huge and will

continue providing the fabulous

growth opportunities to its players.

W h y B o t t l e d w a t e r ?

Millions of people in India, suffer from

inadequate or no tap water supply. The

growing number of cases of water

borne diseases, increasing water pollu-

tion, increasing urbanization and in-

creasing scarcity of pure & safe water

have led the consumers to the pack-

aged water industry. Bottled water fills

a void created by government’s failure

to address the basic societal problems.

What is amazing is that people are

prepared to pay Rs. 12 for a litre of wa-

ter-in India, especially when the cost of

material input (0.25 paisa per litre ex-

cluding labour cost) pales into insignifi-

cance before the price of the prod-

uct. Informal sources indicate that

gross profits of this industry can be as

much as between 30- 205%.

Marketing strategies of the major

players:-

In this cut-throat completion among

the market players, distribution has

become critical for this industry due to

the high volume and low margin effort.

Companies are offering retail margins

of 20 to 40 % against 8 to 10% on soft

drinks. This is very important in case of

this product because consumers would

take up what is available to them at

ease and whatever retailer is giving.

Therefore promotional spends have

become low.

Parle’s Bisleri

First real threat to the market leader,

Bisleri was the arrival of PepsiCo’s

‘Aquafina’ and Coca Cola’s ‘Kinley’. In

response, it followed a differentiation

marketing strategy. It started an adver-

tisement campaign emphasizing on

purity & flaunting patent right the

company has over the breakaway seal.

The objective with the campaign was

to highlight the tamper-proof seal &

create doubt in the consumer’s mind of

the purity of the other brands. That is,

Bisleri is the only one that guarantees

100% purity and keeps you Safe.

Since Aquafina, focussed exclusively on

youth Bislery came up with two vari-

ants:

(1) Bisleri with added minerals

(“celebrate with the sweet taste of pu-

rity”) to focus specifically on the youth

(2) Bisleri Mountain Water( “natural

mountain water”) to emphasize on the

purity aspect.

As it is said:- “A product that's not

available where it's needed, is useless.”

The number of outlets where Bisleri is

available have increased from 50,000 in

1995 to 2,00,00

PepsiCo’s Aquafina:-

Pepsi targeted the young generation

and introduced Aquafina as a fancy

product to carry. Water, Pepsi claimed,

was no longer a simple beverage, but

was something highly fashionable.

They complimented it by giving their

bottles an attractive look. This soon

caught the eye of the consumer. It’s

being positioned as a premium product

Page 6 BY MERCUR—I

An unprecedented growth story:- THE BOTTLED WATER INDUSTRY IN INDIA -Shashank Kumar Verma

Market Share of top players in India 2010

in imagery and packaging. The new

swirl shaped PET bottle resembles the

Pepsi family and is sturdier and more

hip than most others in the category.

Coca Cola’s Kinley:-

Coca-Cola introduced its brand ‘Kinley’

as a health care product. Its ad-

campaigns showed a doctor advising a

family to take Kinley for pure water

through its 'Boond Boond Mein Vish-

was' commercial. Kinley’s strategy has

been to target institutions. This has

paid off well until now. It’s focus is

primarily on perfecting its distribution

strategy.

The Way Ahead

Time has come for companies to in-

dulge in brand building activity by

squeezing retailer and distributor mar-

gins spend the money for advertising.

The flavoured water market is still at a

nascent stage in India. Higher price,

limited products and alternative home-

made products are some of the barri-

ers for the growth of this segment. Still

it’s probably the next big thing, going

by the global scenario.

Meanwhile, the tussle to become the

market leader has heated up with the

explosive positive growth forecasts of

the industry, let’s see what’s in the

store for these “water players”.

Page 7 MARK - AVENUE

Brands follow a lifecycle which is very

same as we human beings follow .They

are launched , then they grow like hu-

man beings , after some time they be-

come mature and ultimately decline to

die some day.

Many brands die somewhere in their

growth stage while some die after

crossing mature stage and many get

revived and given a new life when they

are about to die . Significant invest-

ments used in making of brand get lost

along with the brand are also lost. A

bitter truth is even the strongest

brands which are leaders are much as

prone to decline as new products. In

today’s market, where new product

launch is very risky and requires huge

investment so it is often not a bad idea

to evaluate brands which are on decline

and put an effort to revive them.

Branding is a long term exercise. Most

brands take a long time to build, and a

long time to die. Reviving a brand is

also a long term exercise, typically last-

ing more than a year or two.

Challenging part involved in reviving a

brand is that it does not start giving

result in a sudden so for managers who

have quarterly or semi annual goals it is

all the more difficult as they have to

take a long term vision which is to

backed up by a well thought-out strat-

egy and its execution.

The revitalization of a brand needs a

start by addressing the causes of the

decline, understanding the brand’s

promise (and why it may have failed to

maintain its relevance), making re-

quired effort.

Let’s see the 10 ways to revive a

brand

1. Create new usage occasions.

Cadbury’s campaigns are often tar-

geted about finding new occasions to

eat Cadbury chocolates.

Kuch Meetha Ho jaye campaign told

the consumers that anytime they feel

that they are happy and then they can

have Cadbury’s Dairy Milk to celebrate

the occasion. It was followed by Pappu

pass ho Gaya campaign which became

an instant hit and since then Cadbury

has been attaching themselves with

occasions on which the product finds

its usage like on rakshabandhan or be-

ginning of month to start a month on

high note .Recently they launched

Shubh Aaarambh campaign, as in In-

dia there is a tradition to have some-

thing sweet before beginning some-

thing good and pious.

2. Find customers outside your existing

target groups.

Companies in US have revitalized the

orange juice industry from being only

on the breakfast table to a juice for all

occasions. It’s also being touted as a

healthy alternative since it has vitamin

C. With bulk of population in US being

elders has broadened the product

scope and has helped it make a come-

back. John players also entered Female

apparels with their launch of Miss

TEN STEPS TO REVITALIZE A BRAND

-Kumar Vaibhav

Players.

3. Discover a new way of using the

product.

Paxil, Pfizer’s popular anti-depressant, is

also approved and marketed as a treat-

ment for Social Anxiety Disorder

4. Position your product as the one

used by professionals and experts.

The Colgate and other tooth pastes

often associate themselves to some

dental association or some experts in

the field so that their credibility and

trust in minds of consumers can be

increased.

5. Associate a compelling story about

your product’s origins.

Every brand has a good story to tell.

Some may take a little digging to find

it, especially at a bigger organization…

but it’s worth the journey. Consumers

appreciate it and brand gets benefitted

from word of mouth and brand loyalty

that come from a profoundly human

story.

6. Create a jingle that relates to your

product’s unique feature, or Associate

your brand with music that carries cer-

t a i n a s s o c i a t i o n s

Washing powder Nirma’s famous jingle

is a still used after more than 20 years

and it has created a unique brand im-

age in minds of consumers.

7. Develop a new delivery vehicle or

packaging convenience.

Dabur repackaged its Real fruit juice;

the company’s flagship product; as a

natural, great tasting fruit juice for

kids. They aligned the packaging, com-

munication and all elements of the

marketing mix to communicate the

brand’s benefit (i.e., “REAL-tastes like

eating a fruit”).

8. Create a character to personify your

product, ingredient or Attribute or use

celebrity spokespeople.

Fido Dido, the famous 7UP character,

was created and introduced on the

market in 1987.Fido Dido compliments

the core brand values of simple, clear

refreshment, by offering a simple and

refreshingly clear view on life.

9. Become the reason for family and

friends’ togetherness.

Kodak came with its campaign to re-

vive its brand with Kodak moment slo-

gan for family togetherness which was

quite successful however the Brand

could not sustain the success due to its

inability to responds quickly with grow-

ing digital technology.

10. Attach with a cause to generate

goodwill.

One can get themselves attach with

any of the social causes prevalent in

the society like many of the companies

are already doing .Pepsi is associated

with Water Conservation

Page 8 BY MERCUR—I

We want to hear what you think about this issue…..

Please send us your comments\suggestions\feedback at mercuri@iimidr.ac.in.

Monthly Article Writing Competition, Cash Prize of Rs 500/- for the winner .

If you have any query regarding the competition, please reach out to us at mercuri@iimidr.ac.in

MercurI Team

Harish Kumar Raju, Kiran Krishnan, Kumar Vaibhav, Nikhil Gupta, Shashank Verma, Srinath Akula

DO YOU KNOW the origin of company name “Adobe” ?

The name evolved from Adobe Creek in Los Altos, California, a river that ran behind the house

of one of the company’s founders.