Next Gen Marketing
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Transcript of Next Gen Marketing
Next Generation Marketing: Challenges and Issues in India
Submitted By:
Suman Verma (0911275)Manish Kumar Urele (0911033)
Indian Dynamics
Source: McKinsey Global institute
Aggregate annual consumption, Billion, INR
Urban/Rural market Growth
All India Consumption2005
Rural Consumptiongrowth
Urban ConsumptionGrowth
All India Consumption2025
32% 68%
16896
16695
35913 69503India's Consumer Market will Quadruple over the next two decade
Total household consumption, billion, INR
16896
23840
34089
48677
69503
2005 2010 2015 2020 2025
24
8
11
21
29
32
36
42
46
52
No. Of Active Internet User in Millions
Changing Demographics
• Tech-Savvy, Trendy• Difficult to reach-out through traditional
meansYoung: 65% of Indians are
below 35 years of age
• Concern for environment and society increased• More AwarenessEducated: 79.9 % (2009) as
against 34% (1971)*
• Price sensitivity decreased• Concern for society & environment• Focus on company image rather than product
attributes
Affluent: No. of affluent HH (Income > 10 Lakhs) are
expected to increase from 9.5 Mn to 14.2 Mn by 2025
• More players will enter• More competition
High Purchasing Power: Fifth largest consumer market by 2025, 32% growth in Rural
market by 2025
India shining
• More demand• More Production• Less number of deprived household
GDP growth : 8.4 % (Year 2008)
• More disposable income• Seeking more optionsPer Capita Income doubled from
Rs 18885 in 2002 to 38084 in 2010
• Personalized communication possible• Cost decreased• Maintaining relationship become easier
Total Mobile Users 660 and growing with a rate of 50.4% per
year
• Competition increased• Need for up-to-date marketing strategies• Choice of proper marketing channels
5th largest advertising market. Ad spend of $6.6Bn in 2009
growing with rate of 19%
• Opportunity to reach-out younger generation• More effective Viral & buzz tactics• Customized message
45 million Internet users growing at 30% in urban areas
Marketing Strategies & Challenges (1/3)
Social Media Marketing•Maintenance of Information•IT infrastructure hurdles •Customers are not so tech-savvy
Green Marketing•Misconception- green product cost more•Green Myopia: unwilling to pay premium•Requires huge investment in R & D•Green Washing: Distrust on credibility•Newer concept: awareness is required
Rural Marketing•Major income from agriculture (variable)•Lack of Infrastructure Facilities•Many Languages and Dialects•Low Levels of Literacy•Spurious brands and seasonal demand
Direct Marketing•Intruding customer’s Privacy•Design of marketing programs•Analysis and modeling for targeting
Organized Retail•Underdeveloped Supply chain•Inadequate human resources•Real estate hurdles•Insufficient government incentives
CRM•Cost of DB•Slow ROI•Difficult to estimate gain•Employee resistance
Marketing Strategies & Challenges (2/3)
Ambush Marketing•Fear of law suits•It has to be within the premises of law•Needs creativity to design ambush strategy•Consumer’s attitude to ambush marketing
Mobile Marketing•Intrusion of Privacy•Fear of Legislation
Blue ocean Strategy•Difficult to create blue ocean•Can turn to red ocean •Opposed by retailers
Marketing Strategies & Challenges (3/3)
‘Hamara Bajaj’ to ‘Distinctly Ahead’
Marketing Practice in companyE-
Networking Fan page on facebook, Orkut profile, Blogs, Twitters P220TheFastestIndian.com to promote its Pulsar 220 DTS-i
Buzz Sponsoring local events, auto expo, Mileage campaignViral Youtube, Pulsarmania, Internet
Mobile SMS Blast (Monsoon scheme, High value exchange), SMS footer ads to call for a test drive.
Blue ocean Through product innovation (PULSAR), Kawasaki Ninja
CRM Used to send postcards but now sending emails Colour coded card based priority service
Social Education, healthcare
Green Planting new trees on environment day, Giving plant to customers, BS-3 norms, Wind Power
Rural Camp based marketing Setting up Rural Service outlet (RSO)
Changed the positioning from Scooters to Power bikes to deal with the competition from Hero Honda
Hero Honda …… Heartbeat of the Next-Gen
Marketing Practice in companyE-networking Facebook profile, Orkut profile, Blogs, Twitters
Buzz Tagline Dhak Dhak, Women focused PLEASUREViral MTV roadies, twitters
Mobile Sending SMS to customer to remind due dates for service/maintenance
Blue ocean First to introduce the 4-stroke bike in India in 1985 Introduced ZMR bike costing 1 lakhs
CRM "Good life" service, Passport schemeSocial Schools, Hospitals, Relief funds
Green Govt. mandate is Euro2 norms Hero Honda has euro3 standard bikes Uses maintenance free environmental friendly battery
ATL Showing ads aggressively on television, newspapers Sponsorship of commonwealth games 2010 and Zee Sa-Re-Ga-Ma-Pa
BTL Promotional schemes in festive season, gold coin on purchase during Diwali
Rural Separate dedicated department for rural marketing CD deluxe rugged and low priced to suit the price sensitive rural customer Mission Har Gaon, Har Aangan
Hero Honda has become the Market leader owing to its fast response to the changing trends and adopting newer technologies
Customer’s Perspective
FMCG Goods
Customers value offers/discount as their highest priority
Mobile SMS and e-mails proved to score the lowest among all the offerings by marketers.
The 3 top offerings by marketers in FMCG category would be:1) Discount offers 2) Advertisement3) Green Factor
For a typical Indian customer the new technological means are still way into the future and they are not able/willing to access them.
X-Axis : Type of Marketing TechniqueY-Axis : Degree of Likeness (Scale -3 to +3 converted to percentages)
Source : Primary Survey data of FMCG customers
Customer’s Perspective
Consumer Durables
The customers are mainly high end and are less price sensitive. Hence discount offers are not the top priority
Mobile SMS is still the lowest preference for the customers as far as marketing is concerned
Even the High-end customers do not prefer to use mobiles and e-mails as a source of receiving product information
X-Axis : Type of Marketing TechniqueY-Axis : Degree of Likeness (Scale -3 to +3 converted to percentages)
Source : Primary Survey data of FMCG customers
Recommendations
General Recommendations
• Visual and interactive Aids on Mobile
• Focus on Green marketing
• Focus on Rural Masses
Produce environment-friendly products in durables
Hygienically safe products in FMCG category
Use MMS in place of SMS Traditional message on new
platforms such as mobile phones and laptops
Product in different SKUs Provide financial option Demonstrate product & make
rural masses experience them
Use interactive billboards to create buzz among less aware rural masses.
• Rejuvenating CRM
Testimonials by customers Inviting suggestions for
added features
Comparing FMCG and Durables
Characteristics RecommendationsPer unit prices are less and repurchase cycle is small
Implementing CRM: If Per unit price of FMCG is relatively high and repurchase frequency is very high then it is recommended to use otherwise not. (For example, it is futile for the candy if its price is Rs. 10 )
Impulse based purchase possible More Above the line marketing to create mind space
More switching loyal customer, high price sensitivity
More Below the line marketing to retain customers
Too many products in market and are not differentiated too much, any new attribute introduced is readily imitated
Blue ocean strategy is not suitable, No need to invest in R&D, better to follow me too positioning
After sales support requirement is minimal
Mobile marketing is not recommended
Generally the product characteristic are not discussed during public gathering
Viral and social media marketing is not recommended
Lot of spurious brands (similar names) are dominating the rural market
Rural marketing is recommended
Comparing FMCG and DurablesCharacteristics RecommendationsPer unit prices are more and repurchase cycle is high
Implementing CRM: If Repurchase frequency is very low it is not recommended to use. (For example, it is futile to do for item which is one time purchase item like Piano)
Price insensitive customers More Above the line marketing
Products can be differentiated by continuous R&D, people acknowledge the new technologically innovative product
Blue ocean strategy is more suitable, Need to invest in R&D, better to go for first mover advantage
After sales support requirement is high Mobile marketing is recommendedThe product and product characteristic are discussed during public gathering
Viral and social marketing is highly recommended
Rural masses not aware about technology based durables and hesitate to use them
Rural marketing is recommended
DURABLES