How private brands dislodged PSU brands ?

This was almost 25 years back when all of was familiar with HMT watches. They really ruled the market and even I remember in their slogan they called them as TIME KEEPER TO THE NATION.  And their advertising message said if you have the inclination we have the time.  And when they launched the quartz brand they said if we you have the inclination we have the exact time. Here they were emphasizing the exactness to the correct time a quartz watch is supposed to deliver. But in 1987 when the Tata’s came to the market with Titan they came with lot of planning and a well thought out strategy to rewrite the watch industry which they ultimately did so. And within a matter of few years they dislodged HMT and just surged ahead by bringing in variety and innovation in all their marketing efforts. Be it distribution or product innovation they did it differently to only be the undisputed king in the watch business. From a watch brand they have moved into to a whole range of brand extensions and the latest being the launch of perfumes.

By the time we entered the 90’s with liberal policies we saw several categories where private brands entered and started giving tough time to the PSU brands. Let me recollect a few categories where private brands have made deep inroads.

1.       Lubricants: This category was primarily dominated by the PSU brands due to their strong hold on distribution. As no private brands were allowed to sell their products through petrol stations. But that did not stop from private sector to push their products. Castrol was the first to aggressively market their product. Their strong communication strategy helped them gain good visibility to get into the consideration set. They used the bazaar trade for distributing their products and also cleverly opened outlets opposite petrol pumps to make easy availability of the product which gave the car owners one more choice apart from what the fuel station was stocking. They kept constantly innovating and improving their product offerings through strong R&D and became partners to many OEM automobile manufacturers. Today the private sector must be holding all combined, close to 40% market share in this market. We have several brands like Gulf, Elf and Tide water that also had their own share in this market.

2.       Insurance:  Life insurance was synonymous with LIC. In fact the lingo that was used is LIC kar leya…..Also since this PSU brand was backed by government the credibility scores were very high which helped them to gain loyalty  as against the private brand. But today desk research say’s that LIC has only 50% share and the combined private insurance brands control the balance 50%. There are at least 10 brands which are fighting to get their pie in this highly competitive market which has lot of government norms that one has to adhere to. Most of these private brands have pumped in huge marketing spends to create awareness but besides that they also bought in the use of online tool for people to buy polices which is still lagging behind with the PSU brands. With the rapid penetration of internet and a younger population that will rule the Indian market these private sectors will have an upper hand to woo this new generation?

3.       Airlines: The Indian skies were ruled by the Indian Airlines (Now Air-India). But over a period of time starting 90’s we saw the downfall of the Indian Airlines as private operators came in. There was huge shift towards private airlines and the result being that Air-India only has 20% market share according to published reports. In the airlines business service matters a lot and that’s where Air- India dipped very low to surrender their market. Besides the constant staff and pilot issues also eroded their equity over a period of time. Plus the continuous newness in the service and the competitive pricing by the private operators never allowed Air- India to regain their glory which they sat on for many years.

4.       Telecom:  BSNL and MTNL were the household name in the wired connection when it came to telephone. One had long waiting period to get a permanent connection. At one point of time having a telephone was a luxury but starting 90’s with the advent of mobile connections it very soon became a necessity. While both the PSU brands are also present in the mobile space but not sure what is their market share. Nearly 85% market share is held by the private brands. Here again  technology and aggressive marketing helped these private sector brands to hold the market with lot of ease as there is no fight or competition from the PSU brands.

While red- tapism and vested political interest has been by and large the deterrent for PSU brands to grow.  We must also keep in mind that the mindset of Indian consumers have shifted and changed in the last few years. The new breed of Indian customers seeks value in whatever they buy and hence it is important for both the PSU brands and private brands to get their value proposition right.  With internet within the reach the narrowing of buying decisions have become easier as price comparison more product information are being provided by many aggregators. Unless there is huge overhauling done by PSU the story will not change and private brands will just keep on cashing in.

This Diwali should I gift Chocolates or Mithai?

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All of us know that as Diwali is nearing there is always a debate should I gift Chocolates or Mithai at home, to my friends and my business partners. It’s been a tradition that every part of India celebrates this great festival of lights by sharing joy and happiness with sweets. But over a period of time as the new generation has entered this world there has also been a marginal deviation in the thinking when it comes to gifting and sharing sweets during diwali. This is partially because of the strategy adopted by many chocolate brands (which include homemade chocolate brands and products from the big MNC’s) who have entered this market to capture some share of the mithai market during this great festival across India. Let’s look at some key differentiators between the two.

1.    Traditional & Emotional: Diwali is a festival which has lot of history and tradition which date backs to many years.  Most of them love to preserve the values of traditions connected with sweets made and prepared at home. These traditionally prepared sweets bring in plenty of love and emotional expressions when they are exchanged with your relatives, family members and friends. While the promotional campaigns of many chocolate brands try to bring the emotions through their advertising but they are not able to capture the real essence that a mithai is able to deliver. Every ingredient that goes into a mithai has that warmth and emotional connection with the audience.

2.    Wider Choice: There is no limit when you think of preparing Mithai. Since Mithai is very meticulously prepared by hand the touch of authenticity further enhances its taste. Which is missing in chocolates though some brands try to use some special ingredients to come closer to the mithai. The good old parents and grandparents always relish the wider choice that one has when it comes to mithai. The natural ingredients have more positive impression as compared to the artificial flavors.

3.    Pricing v/s Presentation: Mithai’s are still easily affordable as the prices are not so steep. You have a larger choice to pick from. You can taste it at the sweet shop before you decide to buy your preferred Mithai.  And when you prepare it at home you can use genuine ingredient to make it healthier, tasty and less expensive. This is not true with Chocolates but when it comes to Corporate gifting due to its attractive packaging and presentation Chocolates scores over the mithai.

4.    Innovative & Delicious: One can experiment lot of innovation while preparing a Mithai and that has been the hallmark of traditional sweets. One of the most popular items that have caught over the years has been the Mithai for health conscious audience. This is prepared from quality dry fruits which are preferred over the chocolates by many diabetics as chocolates are perceived to be more rich and sweet. But chocolates have a larger shelf life compared to mithai and therefore it has an added advantage as compared to mithai when gifting to the corporate and sending it out of station through couriers, to far off friends.

Both chocolates and mithais have their merits and demerits when it comes to sharing and gifting during diwali. But with the change in the audience pattern there is a different point of view between the two. While mithai has still stuck to the core values of maintaining the traditional image but the chocolates has wooed the new generation audience with their product and packaging to explore chocolates instead of mithai every diwali and every other festive season.

4 ways to make experiential marketing work for you :

Give the consumer a new way of shopping with customer interface, strong consumer engagement, a wonderful ambiance  personal touch, feeling and experiencing the product at the point of purchase and taking back with them a memorable shopping experience. To make this work you need to plan your brand attributes carefully and ensure that the brand promise is delivered at every touch points.

 Brand Experience:  One need to structure the brand experience which will deliver the brand promise through some unique experience. For example if it’s a multiplex brand then you will have to offer push back seats that is comfortable, Dolby system to deliver tantalizing audio sound .quality beaming with great picture clarity. And of course a great ambience with great food courts.

Brand Engagement:  Use the best use of technology to make your engagement very interactive. Install technology like touch screens or kiosks to engage with the audience. If it’s a multiplex then you set up a  quick preview of the next coming moving on the touch screen for a short duration. This is what will delight a customer to stay tuned with the brand.

Brand Connect: Make sure the essence of the brand is captured through firsthand experience. For example if you are marketing Disneyland by setting up a stall in a tourism exhibition, your focus should be to capture the essence of the brand that is fun and entertainment. Highlight the memorable rides to connect with the brand to bring the potential tourists come closer to the brand. As all of us know that Disneyland is all about rides.

Brand identity: Maintain your brand identity to maintain the engagement and connection with the brand. Your theme should connect with the brand values and its identity so that there is consistency in your communication when the customer experiences the brand.