dilema in marketing

T was in the nuclear-charged early '80s that a made-for-TV film called The Day After captured the imagination of the intelligentsia and the strategic scenario planners. Matters were tense as usual in South and West Asia, and the US and the then USSR were locked eyeball to eyeball. The Day After captured the zeitgeist of the time and probably had a role to play in easing the fingers from the nuclear trigger by depicting the stark reality of nuclear fallout.

If I had the requisite film-making skills and resources, it would be time to make a similar documentary on the marketing function's hurtle towards intellectual oblivion, its main contributors, and, hopefully, the way back from the edge of this dangerous precipice.

The chimera of growth with profitability


It's been an interesting journey thus far as businesses have homed in on emerging consumer needs and aspirations. In category after category, new brands romanced the new consumer and many new categories were born, some to implode after shining briefly (remember Ceasefire?). Consumers were introduced to the spectacularly transforming benefits of the branded bath, shampoo and laundry wash. Two-wheelers, colour TVs and refrigerators triggered the upward mobility of the middle class. It was a brilliant moment and the marketing heroes of the moment found fame and momentum. Most of the authors of the marketing success of the '80s are ensconced today as leaders of the industry in a different and more difficult time.

This is about the moment when the market, almost uncannily like a Hindi movie, moved from its exciting first hour to an ambitious but meanderingly unsuccessful second hour. The strategic response was bad copybook. Population and incomes are growing, so launch brands aggressively. Recalibration of effort meant upping the ante and even more aggressive marketing efforts. The marketer's boom was upon us. The need of the hour may have been marketing support not unlike the Maruti 800 (nuclear family-sized, economical and taking brands a long way) but the marketers were unable to take their eyes off the big, statuesque gas-guzzlers. It is no surprise that this was about the time that marketing services industry growth rates were about to peak and visionary marketers may have sensed the wall they were about to hit.

It was in 1960 that Theodore Levitt pointed out the `Population Myth' in his now legendary paper in the Harvard Business Review. He purported that a growing population of more affluent consumers could lull the marketers into a false sense of comfort. After all `If thinking is the intellectual response to a problem, then the absence of the problem leads to an absence of thinking. If your product has an automatically expanding market then you will not give much thought to how to expand it.'

Well, may all of us be blessed with expanding markets but a devil seems to have come home to roost. It seems that our population expands under the umbrella of an amplified quest for value. And, it may be possible that all investments have been pegged to a potential Indian middle class of around 200 million people and in reality that market could be as small as 40 million urban consumers. And consider the possibility that small packs of FMCG brands may not be regular packs for low income or rural consumers - they may just be an infrequent trial pack.

The perils of fixing the `it ain't broke' value proposition


The equation seemed simple as marketers seemed to have a grip on price thresholds and probable size of markets. Assess and enter the market but above all get the consumers' value proposition right was the well-worn thumb rule. In later days, the marketing strategists discovered a resonant new tune in the air and its lilt suggested `value mobility'. Having found success at the value end of the consumer spectrum a new strategy found increasing merit. It aimed at transporting consumers at the upper end of the value segment into higher price bands, where value-added brands with aggressive marketing inputs would deliver unresisting hordes into the premium brand fold.

Well, something has come unstuck. The Indian consumer was brought up, it seems, on a different cup of tea. Growth slowed and the speed of brands from cradle to grave became much quicker, sometimes instantaneous. It is a fact that the moment marketers get inward-looking and take their eyes off the consumer benefit and the `affordability' factor of pricing, the only result is portfolio restructuring five years down the line. Simply put, this means if you launch brands without a consumer focus, you will need to withdraw them soon because your balance sheet cannot carry their weight.

Companies that grow aggressively often talk about triple-win strategies, creating winning teams, raising the bar and changing the game. Very rarely is the core construct of successful brands discussed — that `zone' of strategic overlap between brand architecture and consumers' ability to pay. Which probably explains why so many premium brands are desired but not necessarily purchased except when their prices are slashed to within range of the consumers' wallet.

In a study done by an eminent consulting firm on attempts by multinational companies to extend their brands to developing markets, they concluded that brand-name products would always capture their share of affluent consumers. But in the low end of emerging markets, companies should take their cues from local competitors: keep local managers in place, adhere to local standards of quality, and maintain the autonomy — and the cost efficiency — of local operations.

The cliché of advertising (and the bucolic joke)


It may be time to take a closer look at our brethren from the alluring world of communications who seem quite keen on reinventing the rules of advertising. In today's environment, reinvention may be the soul of survival. But whatever happened to the core tenets of building powerful brands and stronger volumes? Marketing services was the visible 10 per cent of the marketing iceberg. Under the ocean of business lay the rest of the strategic marketing effort - pricing, proposition development, market sizing, price sensitivity and adoption modelling. But somewhere down the line the seductive Mata Hari of advertising, events and promotions slunk in and turned the business on its head. Not helped, of course, by the view of most structures that if your advertising and promotions budget is more than Rs 10 crore, the marketing manager is really an advertising manager. And maybe, therefore, clever advertising equals clever marketing.

The old guard of advertising knew the principles of business — the role of communication is to deliver empathy, resonance and action in a profitable way. Somewhere along the line chunks of advertising turned into a self-indulgent chuckle. And strangely enough, if it is sufficiently rustic it even wins awards. `But the heart of India beats in the Hindi heartland', I am told. Sure, it may. But advertising that raises a chuckle may not always raise sales. And adding to the adage that the consumer is not a moron is the fact that life is no stand-up comedy either. And businesses that are trapped in stagnation or below six per cent growth are not amused at all. Neither should they be.

Advertising is now news and the creators of advertising often aspire to the same stage as the superstars they cast in their creations. It would be petty to deny them their moment. But what about brands and businesses? The musical chairs of the multi-crore account shifts may not do the trick. As my first boss in advertising used to say — the answers are with the consumer, stupid! And more often than not, marginal tinkering with the advertising content and increased spending may be bad deployment of good investment. Various estimates pegged growth in revenues for the advertising business at 25 per cent in 2001 though the agencies themselves estimated their growth at a more stately nine per cent. Could it be that the membership of the top 20 advertisers' club is going at a higher premium than the membership to the top 20 club of successful businesses?

Marketing strategists need to take control of the process and programme their businesses for success before the power passes on to the bean counters. They are already asking the question — if advertising does not always deliver the goods, why advertise? Marketing strategies lie at the very soul of business strategy and marketing communications can be its lifeblood. Businesses need to seize the moment, and the future!

Elbows, asses and Aesop's fables


I remember an explosively comic serial about journalistic shenanigans from the '90s entitled Drop the Dead Donkey that had at its core the basic newsroom principle: If the news is not relevant, drop the news. Probably the same applies to the new generation marketing specialists and their tools. If they aren't relevant, spend some time finding new ones that have a better chance of delivering growth that businesses seek.

I hope you see the analogy — successful brands are expected to carry profitable businesses forward. In a somewhat ironic twist to the tale, not unlike the fable where, stung by the taunts of fellow villagers, the washerman and his son had carried the ass on their shoulders, heaving businesses seem to be carrying sick brands, to the dismay of stakeholders. Well, there isn't much elbowroom to manoeuvre, as consumers get increasingly vocal about their choices and rejection.

And there may be one serious error in my view of the emerging world of marketing solutions — the crisis may not be emergent anymore but amongst us, not unlike a cat among the pigeons.