Tag: Advertising

How much below the line?

How much below the line?

One can argue that most ad spending today is utter waste and does little to meet its supposed objective, especially the really expensive monthly-quarterly campaigns. Everyday we come across average looking and ineffective (more important that ‘just being creative’) ads in the newspaper and on television.

Yet at times, the product itself is so good it outperforms the ineffectiveness of the ad campaign and this is mistaken as a triumph for those attempts in traditional marketing and advertising. Competing firms, either from the same industry or otherwise, look at this and assume huge ad spends to be the answer to their problems, before they realise it’s too late and then axe themselves in their foot once again, this time with a different promise bearer who yet again is into ‘edgy stuff’.

In the same breadth, it is not always wise to assume that promotions and events are a good blind substitute or will always prove to be better as opposed to ad spends. When buying a television, the promise of a free duffelbag is hardly a carrot. Talk about free software (licence fee waived off) along with a branded computer and yes consumers will show interest.

Invite the customer to relate to what you are offering and she/he will excuse you for carrot dangling. That is how custmers think by and large.

Elementary, my dear Watson

Elementary, my dear Watson

JOHN WANAMAKER, pioneer of department stores in the US, once confessed that he knew that only half his advertising works; the problem was, he didn’t know which half. But today’s marketers cannot afford to makes such a confession. With marketing accountability becoming the motto of the top management, companies are increasingly looking for return on every marketing rupee spent. Developing effective marketing programmes is now the most important objective of marketing practitioners. But what exactly does the term marketing effectiveness imply?

Marketing is what marketing does

In Economics, we are taught that money has no inherent value. It is simply some printed paper or some numbers in the account books, unlike air, water and other basic necessities, which are indispensable to life. The value of money lies in the function of serving as a medium of exchange. Money, then, is what money does.

Twist this statement a bit – replace money with marketing and you get another universal truth: Marketing is what marketing does. Marketing tactics (including advertising, sales promotions, product development and brand management) are useless, unless they serve the purpose for which they were designed. That purpose, the endpoint of all marketing, is sales. No matter how brilliant your marketing strategy, if it does not ultimately result in sales, then it has failed.

EFFIEs and effectiveness

The New York American Marketing Association introduced the EFFIE Awards in 1968. Every year, EFFIE awards are given away to the most effective advertising campaign of the year in the respective country. Winning an EFFIE is about meeting a challenge and succeeding. In the words of a recent winner, “Effective advertising is advertising that sells; advertising that builds market share. The EFFIE award is the symbol of effective advertising and a tribute to the client and agency partnership that strives to create it.”

Of course, there are no absolutes in the world of marketing, no formula for marketing effectiveness. Every marketing challenge is unique and requires a distinctive approach. Having said that, there are certain best practices in marketing that have stood the test of time. These practices have a few factors in common, all of which are inter-connected and must be considered carefully before embarking upon any marketing programme. Surprisingly, these factors lead us back to the basics. So let’s re-visit these basic principles.

Essential Ingredients of a Successful Marketing Campaign

CONSUMER INSIGHT tops the charts. Every sensible marketer knows the importance of relevant consumer insight. The consumer is the king around whom the world of marketing revolves. And that makes consumer insight the single most important factor that shapes a successful marketing campaign.

According to Sunil Lulla, “Consumer insight is crucial if you want to be effective in your marketing efforts. Post that it’s the ideas and the execution that make all the difference. For instance, Sony Entertainment Television’s marketing campaign for ‘Jassi Jaissi Koi Nahin’ was truly differentiated and innovative and was driven by a very strong consumer insight – that people tend to judge others by the way they look. Hence we launched a campaign, which never revealed the protagonist but only built her attributes and character.”

Lynn DeSouza adds: “I believe it’s hitting on the right consumer insight, which is an outcome of good planning and knowledge of consumer behaviour. Touching the right chord in the consumer’s mind and/or heart can actually lead to faster results requiring lower investments and ad budgets. The anti-FD campaign of Franklin Templeton is a great example of a hardworking consumer insight translated into interesting creative execution that required much lower ad spends than competitors to win great results for the company.”

But consumer insight alone is a necessary, and not a sufficient, condition. Rohit Srivastava says, “Consumer insights are interesting because they can often define the opportunity or create a strong leverage for marketing the brand; not as an end in themselves. However, a competitive leverage for an effective marketing program could come from other sources as well, such as a price or distribution advantage, a product edge or a service differentiator.”

THOROUGH PLANNING plays an instrumental role in the success of every marketing effort. Planning enables marketers to get a complete picture of where they stand, where they want to go, and the paths available to them to reach there. Planning helps obtain relevant data relating to consumer preferences, market and competitor activities, economic trends and prospects and other such information that is necessary to make informed decisions with respect to available options.

Srivastava says, “Planning to me is a very broad word and to that extent it will always be the key force behind marketing effectiveness. That’s because the world is too tough, too competitive for great results to be achieved as a matter of chance or luck. On the latter I always remember what one of the golfers is credited with saying: “the harder I practice, the luckier I get!”

Yet, if the basic assumptions about the market (and the consumer) are erroneous, the plan will fail. Consumer preferences are ever-changing and therefore, it is important to capture the pulse of the market in order to minimise the risk of failure. Here, focus helps.

FOCUS is a corollary of planning. It implies having clearly defined marketing goals and the strategies to reach those goals. Without focussed strategies, marketing efforts tend to become fragmented and the outcome is diluted. So does one bring focus into one’s marketing effort? Pranesh Misra answers, “Campaigns that follow the ‘Be clear – then clever’ principle tend to be more effective. Campaigns have to be clear about some critical issues: who is the key competitor, who is the core consumer, what is the key communication challenge, what is the insight driving the brief, and why the consumer should believe it. Being clear means having only one answer for each of these questions and not multiple ones. More that one answer means that the brief is not focussed.” Focussed inquiry will lead to identification of tasks at hand.

IDENTIFICATION entails discovering, and defining clearly, your organisation’s strengths and weaknesses, weigh it against market opportunity and the competitive and economic threats, and finally develop possible strategies to exploit the opportunity and avoid the threats. Srivastava explains this comprehensively, “Within the broad ambit of planning, I look for one or more of the following, which are good drivers of marketing effectiveness:

1. Sharp diagnosis of what’s ailing the brand or the category. This is where most organisations falter. They are either blind to the core issue or too scared to face it. If the diagnosis is clear, it does not take rocket science to figure out what needs to be done to drive the desired results.

2. Sound understanding of the opportunity. Again as someone said, just because there is a gap in the market, does not mean there is a market in the gap! If the opportunity is genuine, large enough and well-defined, it significantly raises the odds that the brand will be effective in the marketplace.

3. A grasp of what it will take to exploit this opportunity. Marketing is a game of leverage; does your strategy give you enough leverage? A big leverage means you can move the market with disproportionately lower investments, at least relatively speaking.”

SUSTENANCE AND PERSEVERANCE are essential for a marketing programme to achieve lasting results. It is said that perseverance and failure cannot coexist. Failure happens when you quit. Planning, insights and focus will lead you nowhere, if the marketing activity is not sustained over a period of time. Srivastava says, “All of these can come to naught if they remain on paper or a PowerPoint slide. Marketing effectiveness calls for a sustained activation of the game plan.”

TIMING often deceives even savvy marketers. A strategy or a tactic that has worked yesterday, may not work today. At one time, the Onida Devil worked wonders for the brand. But after a few years of uninterrupted presence, the magic of the devil began to fade – the devil had outlived his utility. So campaigns are time-sensitive. The problem is that it is often difficult to discard a once-successful campaign because it has either lost its relevance or it has lost its charisma. Again, to recognise that a campaign will not work anymore is easier said than done. Marketers must develop a keen perception of the market mood, trends and patterns. That allows them to be open to change and flexibility. (Incidentally, Onida has recently brought back the devil in a new avatar. What it does to Onida’s fortunes remains to be seen.)

FLEXIBILTY really comes from acknowledging that marketing is a social activity that depends on many societal factors. Change is in the nature of all human beings. Everything changes over time – consumer’s preferences, buying behaviour and spending habits. Good marketers have a built-in contingency plan in the marketing programme to deal with any unpredictable or unseen changes in the marketplace.

PASSION of those working on the campaign may not be recognised as a necessary element of marketing programme; nevertheless, the lack of it can lead to a lacklustre campaign. Passion is required to come up with creative and original ideas that work. Passion is required to intuitively understand the ever-changing marketplace. If insight, analysis, planning and focus are the blood, passion is the oxygen of marketing. Srivastava says, “Marketing programmes need to be driven with the passion and zeal of a crusader. They must be created by, and in turn create, believers of the brand. This calls for honesty, commitment, passion and a relentless pursuit of the cause – the consumer’s cause.”

When we falter…

So what happens when we lose track of these basic principles? Let’s consider an example of a failed marketing campaign. The Maruti Versa launch campaign unleashed last year, failed, in spite of Amitabh Bachchan endorsing the brand. The big B factor worked to the extent that it brought prospective consumers to the showroom. But the product disappointed them. Mind you, there was nothing wrong with the product or with AB’s endorsement of the brand; it was the positioning that went wrong. Because of AB’s presence, the consumers expected a larger-than-life kind of a product. But what they saw was a small wagon-type family car – there was a mismatch between product expectation and delivery. “The inability to grasp the real communication challenge is at the core of all failures,” says Misra. In this case, the communication challenge was finally met, when Maruti launched another campaign, this time showcasing it as the family.

What happens when we fail to obtain consumer insight? Lulla believes that when the campaign is not based on insight, it will not resonate with the consumer. “You may have a great looking campaign that may grab attention but might not achieve much after. It is not just about getting noticed; it is about being effective and creating the desired impact.” Srivastava adds, “Most brands in most categories settle into a state of mediocrity with no real differentiators and no genuine effort to create them. There is helplessness and far too ready an acceptance of the status quo, resulting in an over reliance on ‘an advertising idea’ to pull the brand through. Even this, where the brands have one, is confined in its expression to a typical mass media campaign. There is little follow through, poor support and negligible activation programmes that drive the idea and take it forward. In some cases, the idea itself is sacrificed with a premature change of the campaign; driven by a change of the marketing team or the agency.”

A few years ago, after the tremendous success of CeaseFire fire portable extinguishers, the company (Real Value) launched another innovative product – vacuumised containers. The product bombed, in spite of bigger ad spends and massive advertising on TV. There was no real demand of the product in the Indian market. Lack of planning causes marketing’s effectiveness to diminish. This happens because without proper planning, there is no way to determine deviations from the path and consequently no way to take corrective action if/when it is required. “One of the key reasons of ineffectiveness of marketing is inadequate homework – about the consumer, the way she or he is changing, and about one’s competitors and their strategies,” says DeSouza. Indeed, for look at what inadequate homework did to one oil company in Australia, which spent three million dollars on a TV advertising campaign only to find that 60 per cent of the target audience thought the ad was from the competitor. So in effect the company spent three million on advertising for their competitor. Proper planning might have prevented this unfortunate loss.

Wrapping up

A marketing campaign, however glamorous or expensive, does not yield the desired results, then it not marketing at all. We have all seen some heavily criticised marketing efforts yielding good results for the brand (Dandi Salt). We also know about high-profile and much-written-about marketing campaigns that have failed to push up brand sales (HomeTrade.com). In the end, the measure of marketing effectiveness lies in brand sales. Nothing else counts.

And effective marketing, as we have discussed above, is a process of planning and executing strategies with clearly defined goals, in a sustained and flexible manner, using relevant consumer insight. Provided that we stick to these basic principles, and do not lose sight of the ultimate objective of increasing sales, we will succeed in our goal of attracting, retaining or converting consumers. As Sherlock Holmes would say to his friend and confidante: “Elementary”.

The author expresses his thanks to the following experts for their views:

  • Pranesh Misra, President and Chief Operating Officer, Lowe India
  • Lynn DeSouza, Director of Media Services, Lintas India Group
  • Sunil Lulla, Executive Vice President, Sony Entertainment Television
  • Rohit Srivastava, National Planning Director, Contract Advertising
Low penetration means big opportunity

Low penetration means big opportunity

Manoj Khatri: What are the principal drivers that influence the underlying profitability of the brown goods industry?

Gulu Mirchandani: In the current market scenario, where the value erosion stands at 15 per cent for 2003-04, it is increasing becoming difficult to hold on to the bottom line. Nevertheless, the following are the key drivers of profitability in this industry:

Volume Growths: The low penetration levels of these products is a big opportunity area and the industry is strongly taking this route of increasing the production and sales volumes in order to make the most of the economies of scale. With increasing consumption, the raw material prices have been moving southwards, thereby enabling better profitability

Product Mix management: The challenge is to be able to have a healthy mix of high-end products contributing to the bottom-line. This can only be achieved by offering products which are unique and where the customer sees value in his purchase. The customer is ready to pay more if she feels that she is getting something, which will improve her life and enhance her lifestyle.

Product Innovations: It is also important to catch the changing trends in consumer lifestyles and offer the right product at the right time. Basically, we must innovate on a continuous basis in keeping with the changing consumer needs and to differentiate in the market.

Operational efficiency: It is important to gain overall operational efficiencies like inventory management (Overall inventory less than 15 days), debtors management (Ideally nil bad debts and zero days operation). A good, committed and loyal network also contributes significantly to the bottom line.

Manoj Khatri: Which forces (macro as well as firm-level) are likely to play a major role in shaping the future evolution of the consumer durable industry, say, with regard to growth in demand or introduction of new value propositions?

Gulu Mirchandani:Growing disposable incomes and the low penetration levels: Substantially low levels of penetration, coupled with the growing disposable incomes, will ensure greater share of wallet for the consumer durables industry. The changing lifestyles of the consumers will generate demand and need for this products. The new markets and the resultant demands will be strong influencers on this industry

Opening up of the market/easy access to multi optional inputs: With enhanced possibility of better and easy cross border talks with the suppliers worldwide, the range of offerings has gone up while the cost is coming down

Entry of new players: With the number of players increasing, there has been more action throughout the year and the industry has a buzz around it with constant high pitch communication from the industry to the consumers.

Technological advancements: Innovations and inventions will play a major role in shaping of this industry’s future. Technological advancement has always been at the back of most of the peaks in this industry’s growth. Right from the introduction of colour picture tube to the recent technological advancement of CRTs becoming pure flat, technology is the prime booster for this industry. Advancements in future technologies like the LCD panels and DVD recorders and the like will critically impact the industry. It is expected that by 2008, 33 per cent of the worldwide demand will be met by LCD TVs and Plasma TVs.

Manoj Khatri: Given the competitive scenario in most brown goods segments, what are the central challenges an electronics company like yours must address, in order to retain its price competitiveness and market share?

Gulu Mirchandani: The core to handling various market challenges is to protect the bottom line while being competitive in the market.

Constant Product change: It is critical to have constant newness in the consumer benefit offerings so as to be relevant to the consumer and to be differentiated against the competition. Also, it is important to have low turn around times on the creation of benefits for the consumer, in order to be effective and ahead of the competition.

Operations Integration and Efficiency enhancement: In order to get better return for the inputs, organisations will have to look at integration on backend (components required for the making of the product, logistics etc) as well as the front end (customer touch points, direct sales etc)

Brand Positioning: Every purchase of the consumer is not guided by the cheapest of the prices, but by the benefit that she perceives for the investment planned by her. Hence, it is critical to be appealing to the image seekers while being relevant to the value for money seeker. With lifestyles improving and becoming important to individuals’ personalities, the brand’s positioning and its relevance to the consumer will become more important than ever before.

Customer Relationship Management: The experience that the consumer goes through during the entire purchase cycle and the post purchase usage experience is critical to the organisations’ future business. Managing customer relations and the experience that is offered to her throughout will be a challenge for all players.

Channel Management: A strong influencer on the buying decision is the network, and the organisation that manages the network better, has a substantial edge over others.

Manoj Khatri: What broad strategic initiatives were affected during the last few years by Onida in order to exploit any opportunity that the market offered and also hedge against any underlying risk? To what extent have these initiatives benefited Onida?

Gulu Mirchandani:The past couple of years could be termed as the most dynamic years in the history of this industry. We have witnessed the rise of MNC brands and its adverse effect on the Indian counterparts. Many Indian brands have become almost extinct. We are probably the only Indian brand who have not only survived but have grown during this period. Today, Onida enjoys a high brand salience and is seen as a trusted and reliable brand, with a very high degree of product satisfaction among its users. These have been our key focus areas where we have taken major initiatives. Today Onida offers three principal assurances to the consumer, which is key to our success:

Brand Image – A TV today is a lifestyle statement for the consumer and hence the brand must evoke that sense of pride of ownership in the consumer. At Onida we truly believe this and hence over the years we have been investing on making the brand more modern and contemporary. Today, we enjoy top-of-mind recall and our being among top three brands of the country proves that our investments on the brand have been worthwhile.

Product – TV is seen as a high-tech product with a high risk of obsolescence associated with it. Hence a consumer tries to buy the best at the time of purchase. Onida lagged behind a bit on this parameter primarily because of the delay in introducing flat TVs. However the brand has greatly regained its technological edge in the recent past based on strong focus on Onida Black, the flat screen TV, and today we are at par if not better than the multinationals in this segment. For very high-end consumers who value technology and who would like to have nothing but the very best, we are in a process of introducing plasma and rear-projection television, which is the latest technology available anywhere in the World. Onida is a brand where lot of action can be expected in the very near future. We will touch consumers at all levels and if one is looking for any product related to consumer electronics and home appliances, Onida will definitely change his world.

Service and Quality – Given that TV is a high-ticket purchase, the consumer needs a strong reassur
ance from the brand in terms of reliability. Longstanding brands that have proven track record of trouble-free product performance score on this parameter. Onida is seen as one of the most reliable brands in the TV category and we keep quality at top of our priority list. Like any product, electronic goods suffer wear and tear. It is how fast you address the problem that is important. We believe a satisfied consumer is the best brand ambassador we can get.

Manoj Khatri: Against the backdrop of slackening of demand in many categories of brown goods in recent times and entry of powerful MNC competitors, how are you redeploying their resources * be it with regard to ad spend, sales promotion, distribution channel or sales organization * with a view to maintaining a threshold level of growth in both top and bottom line?

Gulu Mirchandani:To start with, unlike the overall brown goods industry, colour television industry is growing and we expect the market to grow by 10 per cent this year. Industry CAGR as of now is 15 per cent, with all India-penetration of 18 per cent. So there is a huge potential in this market. Even in the metros, the opportunity is huge, with a penetration of around 40 per cent. Therefore, the industry is definitely poised for growth. The major part of the industry is expected to come from the black and white up-graders. Hence we have special focus on this segment. Our distribution strategy is to reach the rural markets and hence we have our sales and service teams spread across India through 30 branch offices, 150 service centres and 35 godowns. We are also looking into our distribution network and trying to seek other opportunities to increase penetration. Our advertising will also be focussed on both the bottom and the top end of the consumer triangle so that we get the best of both – the replacement and upgrader segments.

Another key area that we are redeploying our resources is our new businesses. We have just launched air-conditioners, which have been accepted very well among the consumers. This category is expected to grow at a very high rate in the years to come, and we expect to be among the top brands in the air-conditioning industry. We also have plans to re-launch washing machines in a big way this year. We are targeting 7-10 per cent market share in washing machine business, and have very strong marketing plans to achieve the same. Over all the brand is in the upswing and as of now we are among the top 3 brands in the country. Financially we are clocking profits every year, unlike many multinationals, which somehow lose focus on the bottom-line in their mad race to achieve market-share. So overall you can say we are having a healthy profitable growth both in terms of top and bottom line.

Star Struck!

Star Struck!

Stars, who are known to shape destinies, cast an enormous influence. No, we’re not talking about astrology here. We’re referring to the powerful effect of celebrities on the destinies of brands. One approving nod from a famous face can translate into millions in brand sales. Perhaps that’s why the world over, companies have been using stars to endorse everything, from food to food chains, from soft and hard drinks to health drinks, from clothes and accessories to cars (and the tyres on which they run). Even political parties are awestruck by the charisma of stars. Such is the magnetism of celebrities in this country that during the recent general elections, major political parties fielded a record number of film stars and cricketers to contest from important constituencies around the country. So what about celebrities drives companies to spend in millions on obtaining their stamp of approval on their brands?

Celebrity Endorsements as a strategy
Signing up stars for endorsement is a time-tested strategy and has been effectively used by some of the top brands in the world including Nike and Pepsi. In India too, HLL has used Hindi film stars to endorse their beauty soap Lux since the fifties. Vimal, Thums Up, Gwalior and Dinesh are some of the other brands that used star-appeal in the early days of mass advertising. And who can forget Kapil ‘Palmolive’ Dev?

The ultimate objective of using a celebrity in an ad is the impact on the bottom line. Star endorsements have several benefits, key among them being building credibility, fostering trust and drawing attention… any or all of which can translate into higher brand sales. So how does one decide whether to put a celebrity in an ad? Ideally, this should be dictated by the communication idea. MG Parmeswaran, Executive Director of FCB Ulka says, "As advertising professionals, we recommend celebrity endorsements when the case is justified. There are many cases where you need to use the celebrity to break out of a category clutter. At times celebrity endorsement is used to build credibility to the brand offer."

Most experts concur that, when used judiciously, celebrity endorsements can be an effective strategy. According to Mohammed Khan, Chairman of Enterprise Nexus, "Using a celebrity by itself is not a bad idea provided it is done intelligently."   And there are many examples of good use of celebrity status. Amitabh Bachchan has been used remarkably well by Parker Pens and ICICI Home Loans. And Shah Rukh Khan’s endorsement of Hyundai Santro too seems to have worked well. Parmeswaran adds, "We used cricketers like Rahul Dravid for Castrol in an attempt to break out of the clutter, as well as have an image rub off of ‘dependability’ on to the brand."

Six uses of Celebrity Endorsements
Establishes Credibility:
Approval of a brand by star fosters a sense of trust for that brand, among the target audience – this is especially true in case of new products
 
Attracts Attention: Celebrities ensure attention of the target group by breaking the clutter of advertisements and making the ad and the brand more noticeable

Associative benefit: A celebrity’s preference for a brand gives out a persuasive message: because the celebrity is benefiting from the brand, the consumer will also benefit

Psychographic Connect: Stars are loved and adored by their fans and advertisers use stars to capitalise on these feelings to sway the fans towards their brand

Demographic Connect: Different stars appeals differently to various demographic segments (age, gender, class, geography etc.)

Mass Appeal: Some stars have a universal appeal and therefore prove to be a good bet to generate interest among the masses.

Idea First
Celebrity endorsements are very expensive therefore their use in an ad should be justified. The message strategy should warrant celebrity endorsements – there should be a strong need to consider use of a known face in an idea. Sadly, very often, the celebrity is hired first and an idea is then weaved around his or her presence. Khan stresses, "The important thing to remember is that putting a celebrity in an ad is not an idea in itself. Unfortunately, this is how most celebrities are being used in Indian advertising where they just become a prop. Ideally, there should be an idea that makes the celebrity relevant to the product and the consumer."

Celebrity’s presence in the ad should be contextual. When Sachin Tendulkar says declares, "Boost is the secret of my energy," it doesn’t seem out of context. Internationally, Nike’s association with Michael Jordan is legendary and also logical.

Apple Computer introduced its anodized Aluminum range of Powerbooks, the 12-inch and the 17-inch models, with actor Verne Troyer (from movie "Austin Powers" as "Mini Me") and Houston Rockets centre player Yao Ming. If you think that Apple has simply engaged two celebrities to brand their laptops, you are wrong. They have engaged a very tall person (Yao Ming) and a very short person (Verne Troyer), to contrast the size of their small and large Powerbooks, by having Verne Troyer use the 17-inch PowerBook, while Yao Ming uses the miniscule 12-inch model.  [1]

When it doesn’t work
In the last decade or so, there’s been a spurt in the use of celebrity endorsements. And with it, there’s been an increase in the number of instances of brands failing to take off in spite of the biggest and brightest stars endorsing it and consequently leading to speculation about the soundness of celebrity endorsements as a communication strategy.

According to leading management thinker Dr Seamus Phan: "Many celebrity endorsements fail because they identify a celebrity they like in an emotive and un-researched manner, and then try to create advertising to force-fit the celebrity into the creative concept. Often, the finished advertising is at best contrived, and often, simply laughable. At the end, the brand suffers from a mismatched concept and celebrity, and millions of dollars are flushed away. If this company is publicly listed, imagine the disservice the company has done for its shareholders." [2]

There are several reasons why celebrity endorsements fail to produce the desired effect, and each of them has to more with the core communication strategy and less with the celebrity’s pull. "Celebrities cannot really be blamed if their endorsements fail to push up the brand sales," says Adrian Mendonza, Executive VP and Creative Director of Rediffusion DY&R. Indeed, for it is important to recognise that celebrities can create interest – whether that interest converts into sales depends on various factors such as brand-celebrity disconnect, improper positioning, clutter of celebrities, or even product life-cycle.

Five causes of letdown
It’s worth going over some of the reasons why celebrity endorsements may not work:

Improper positioning
Associating with a star, however big he or she may be, in itself does not guarantee sales. The most it can do is generate interest in the product or create a buzz around it. Take the case of Maruti Versa, which was launched amidst a lot of fanfare about three years ago. In spite of Maruti signing up superstar Amitabh Bachchan and his son Abhishek Bachchan as brand ambassadors for Versa, the brands sales remained sluggish. To be fair, the Big B magic did work and the ads created significant interest, drawing people into the showroom. But perhaps the positioning itself was faulty as people were expecting a larger than life car, just like the brand’s ambassador. Last year, we saw Versa being re-positioned as a family car, with the core proposition being, "the joy of travelling together." In the words of Ravi Bhati
a, General Manager of Marketing at Maruti, Versa has started doing well and has witnessed an upswing since the new positioning. Last year, the average sales were 80-100 vehicles a month. Now they are selling 450 vehicles a month. [3]

Brand-celebrity disconnect
If the celebrity used represents values that conflict with the brand’s positioning and the values it stands for, the advertising will create a conflict in the minds of the target audience who may reject the proposition. Take for instance Toyota, one of world’s leading auto companies. Toyota chose teeny-pop singer Britney Spears to for its brand Soluna Vios, which is a family sedan which is preferred by married men and women with children. According to Phan, a youth icon like Britney would’ve been better used by Toyota for a sleek sports vehicle and for Soluna Vios, Toyota should choose someone like a mature man, Harrison Ford for example. [4]

Clutter Flutter
In recent times, there’s been such a deluge of celebrity endorsements that it has led to the very clutter that it aimed to break. For instance, Amitabh Bachchan endorses or has endorsed Pepsi, ICICI, BPL, Parker pens, Nerolac, Dabur, Reid & Taylor, Maruti Versa, Cadbury and a few social messages too. Bollywood badshah Shah Rukh Khan with Omega, Tag Heur, Pepsi, Hyundai, Clinic All Clear and Airtel has to his credit more television commercials than feature films since 1992. This over-exposure can be bad for the brand. Khan adds, "We seem to have just 2 ½ celebrities in a country of 1 billion people which is a terrible tragedy. Consequently, each celebrity is called upon to push maybe a dozen brands or so. Which is great for the celebrity but I think it is pretty daft for the brand because the impact of the celebrity reduces as the number of brands he endorses increases." Parmeswaran agrees, "Unfortunately in India, we have too many brands chasing too few celebrities. And the recall value drops by a huge margin when you move from an A Class celebrity to a B Class."

Bad idea/product
Using a celebrity is not an excuse for not having a brand idea. You cannot sell an ordinary product just by making a celebrity endorse it. Parmeswaran says, "Unfortunately using a celebrity seems to be the easy way out of a parity product situation." In fact, if anything, the product will fail faster because the presence of the celebrity will create a buzz and more people will know about the "ordinariness" of the product.

Confusion/Scepticism
The use of celebrities can be confusing. Some viewers quickly forget what product a celebrity is giving his or her stamp of approval. Others are so spellbound by the personality of the celebrity that they completely fail to notice the product/brand being advertised. The brand is overshadowed in the overwhelming presence of the star. In some cases, a celebrity can give rise to scepticism because it might be a bit too much for the masses to believe that the celebrities who are rich and can afford the best in the world are actually using a mass product, being advertised on television. On the contrary, people might speculate about such things as "how much did the brand pay to rope him/her in as the brand ambassador?"

A study done by Cogito Consulting of FCB-Ulka Group has tried to fathom the truths behind why some celebrity endorsements work and some don’t. They have developed two indices, Trait Fit Index and Compatibility Index. TFI is derived based on the top five Brand Personality Traits and the top five Celebrity Personality Traits. CI is derived based on the respondents’ perceived suitability between the celebrity and the brand. The study shows the CI is more important than TFI. The implications from the study were:
1.  an aura cannot overcome a complete conflict of the celebrity with the brand’s personality
2.  when it comes to finance, a young icon is not convincing enough
3.  in the case of youth brands, it is especially important to get the latest heartthrob
4.  use of celebrity helps break the clutter

So using a celebrity just helps you break through the clutter. And if there is low CI and low TFI, that is all that will be achieved.

Courtesy: M G Parmeswaran, Executive Director, FCB Ulka


Risks associated with Celebrity Endorsements
It is important to consider risks associated with celebrity endorsement. Fame is fickle and fleeting companion and can ditch the famous at the slightest provocation. Celebrities, being human, make mistakes. But their mistakes get as much attention as their celebrity status and this can adversely affect the brands that they are endorsing. There are number of examples, both Indian and International, where scandals and scams involving celebrity endorsers have caused embarrassment to the brands they endorse. Companies have to make quick decisions when one of their endorsers comes under fire or their own image could be tarnished. Guilty by association in a consumer’s eyes describes it best.

Magic Johnson lost his endorsement deals when he announced in 1991 that he’s HIV-positive. It wasn’t until July 2003 that he landed his first endorsement deal since the announcement. [5]

It’s a tricky situation for marketers. If a brand continues with the celebrity, it may adversely affect the image of the brand and consequently, brand sales. If the brand chooses to distance itself with the tainted celebrity, the huge costs spent on roping in the celebrity and making of the ads may go down the drain and even then the association of the brand with the celebrity might by then be so ingrained that the damage is already done. "It’s a two-way street. One way it shows the strength of the brand promotion. But it is also fraught with risk if your brand ambassador fails to perform in the related field," says Reliance India Mobile (RIM) marketing head Kaushik Roy. RIM uses Cricket star Virendra Sehwag as its brand ambassador. Roy added, "We want to try and avoid the celebrity endorsements as much as possible. Over-dependence on them will create problems in future so we should stand on our own legs." [6]

Hedging the risk
The first thing to ensure, when zeroing in on a celebrity, is to try and choose someone whose record is impeccable. Having said that, it’s best not to depend on one celebrity, for that can backfire. Instead, it’s better to use many celebrities who represent the same values. Pepsi does this quite well. Capitalising on the popularity of cricket and films in Indian, Pepsi uses several cricketers and film stars in their ads. So when Azzaruddin and Jadeja got embroiled in the match-mixing controversy, Pepsi’s severed its association only with these stars, but its relationship with cricket continued.

So what’s the big deal?
Star endorsement deals are big in every way. They are big on expenses and can have big implications on the brand’s fortunes. Celebrities have enormous potential to shape the destinies of the brands they endorse, albeit sometimes negatively. Therefore, marketers who use celebrities must do so prudently, thinking through the concept of such endorsements carefully before adapting it into the message strategy. Experts concur that you must consider a celebrity endorsement if, and only if, the message strategy warrants it, not because the celebrity’s pull value. And last but not the least, one should seriously consider the risks of associating with a well-known personality, and hedge against a future scandal by not relying on just one celebrity and instead linking the brand’s association with a broad theme represented by several celebrities. If you can’t afford many celebrities, then get your thinking caps on, and come up with a better, safer idea.

Notes
[3] www.exchange4media.com/brandspeak
[1, 2, 4] Does celebrity branding always work? By Dr. Seamus Phan,
www.allaboutbranding.com
[5] Companies Ditch Celebrity Endorsements,
http://advertising.about.com
[6] The brand ambassador gamble, April 08, Online Edition, The Tribune

Orchestrate Your Communications

Orchestrate Your Communications

From marketing oriented to market driven
The incredible explosion of technology in the last two decades has, for all practical purposes, shattered the mass market and made many of the traditional techniques of mass marketing obsolete. The era of companies determining the dynamics of selling their products is history. In the marketplace of the 21st century, the driving force is not companies with products to sell but customers controlling what, where, and how they want to buy. Think Internet. Think 24-hour toll-free phone numbers, credit cards, and express delivery services – Consumers are now able to access information on demand and seek out the products and services that interest them.

Not only has technology changed the way consumers make their purchasing decisions, it has also revolutionised how companies market their products to consumers. The customer’s role has become so dominant that companies are shifting their focus from being marketing oriented to being market driven. To successfully communicate with the modern consumer, outdated mass-marketing tactics ought to be replaced with a targeted, customer-focused approach.

Mass Media was for Mass Markets
Mass media (read broadcast) primarily serves the purpose of large advertisers who want to reach the greatest number of eyeballs. In his book Gonzo Marketing, Christopher Locke writes, “Mass media are mass because they are huge. And the way such hugeness is achieved is by appealing to the lowest-common-denominator tastes in terms of programming content. The program, the content is merely a bait to draw the audience. The real show, the real message is the advertising. And advertisers want to lower to common denominator so that they can get everyone possible into the audience.” This, Locke says, is the broadcast model, which worked very well for mass producers wanting to reach out to mass markets.

But as mass markets are increasingly paving way for a multitude of mini-markets, marketing communications is becoming a complex affair. Most marketers know that mass media does not work for micro markets and therefore they are resorting to using other forms of media, in addition to mass media.

In one proprietary study conducted by Leo Burnett a few years ago, consumers identified 102 different media as “advertising” – everything from TV to shopping bags to sponsored community events. The explosive popularity of the Internet has made things even more intricate. Although the Internet reaches an enormous number of people, mass marketing tactics have miserably failed to work on it.

Consistency is the key
Fairfax Cone, Advertising Guru and co-founder of Foote, Cone and Belding once said, “There is no such thing as a Mass Mind. The Mass Audience is made up of individuals, and good advertising is written always from one person to another. When it is aimed at millions it rarely moves anyone.”

His words apply now more than ever before. The sophistication of consumers, proliferation of media vehicles and fragmentation of mass markets has made it extremely difficult for marketers and advertisers to establish and maintain a consistent voice across multiple media. The key words here are “consistent voice across multiple media”.

Inconsistency in communicating marketing messages can, and often does, lead to ineffective and wasted marketing efforts. Adrian Mendonza, VP and Executive Creative Director, Rediffusion DY&R concurs, “I believe that in recent times and in times to come, the increased media choices will crowd, and in fact throttle, the mind. This battering barrage of information is numbing the consumer so much that you can only reach him and create an impact if your message has both these ingredients: a) It is simple b) It is consistent. The message has to be interesting, simple and single-minded in the first place.”

To this, M G Parameshwaran, Executive Director of FCB Ulka, adds, “Having one face, one look and one identity is not all that new as a concept, but with fragmentation of media, proliferation of media vehicles and increased competition, the task to get into mind space of consumers is getting increasingly difficult. Hence the need to have one voice is all the more important today.”

Integrated Marketing Communications
To maintain consistency in fragmented markets and multiple media, marketers need to adopt new and better ways of understanding, reaching and connecting with consumers. Many leading marketing theorists and practitioners now feel hat integrated marketing communications offers the ways and means to achieve these ends.

In the last few years, the concept of Integrated Marketing Communications (IMC) has been gaining a lot of ground. It has been discussed and debated throughout the world by leading marketing and advertising experts, marketing gurus and academicians. A study of top management and marketing executives in large consumer companies indicated that over 70 percent favoured the concept of integrated marketing communications.

IMC: Definition, Nature and Scope
As defined by the American Association of Advertising Agencies, IMC is a concept of marketing communications planning that recognises the added value of a comprehensive plan. Such a plan evaluates the strategic roles of a variety of communication disciplines – for example, general advertising, direct response, sales promotion and public relations – and combines these disciplines to provide clarity, consistency and maximum impact through seamless integration of discrete messages.

According to Philip Kotler, “Integrated Marketing Communications is a way of looking at the whole marketing process from the viewpoint of the customer.”

A Cohesive Approach
Moving away from definitions, the concept of IMC contends that each component of the marketing mix should work in unison, leveraging the strengths of other components and presenting a consistent set of benefits and images to the customer. This means that IMC requires that all the 4 Ps of marketing, namely Product, Price, Place and Promotion must be planned together to achieve the goal of consistency.

Obviously, such an approach necessitates total coordination of above-the-line and below-the-line communication channels, as well as all other means that may be used to communicate and connect with target audiences. Planning of communication messages must therefore be horizontal and cohesive. Planning, developing, and delivering communication messages need to be interrelated and coordinated, not planned independently and separately from each other. The key to an IMC approach is to be able to select an appropriate combination of marketing communication tools that will achieve the marketing communication objectives set out for a brand. The consequent clarity and consistency of communication maximises the impact of the marketing communications effort.

Internal Mindset
IMC, more than anything is a strategic communications model. It is not just a simple one-look, one-message campaign – rather, IMC is a completely different way of marketing communications. IMC acknowledges that every aspect of a business communicates something to its customers; thus, every action of an organisation is a marketing action as well. Therefore IMC, as a business process, must ingrain itself in every facet of a corporation – it must set right what can be termed as internal mindset. This implies that IMC is not limited solely to the marketing and promotional arms of companies but rather concerns itself with every facet of the business, from top management down to secretarial and support staff. The people in an organisation, along with the products and services offered, project a strong identity of who they are, why they are there, and whose interests they seek to serve. Every aspect of a business communicates something and these indirect messages are among those that IMC seeks to integrate.

Client versus Agency
When it comes to traditional marketing, many clients attempt to integrate the external communications effort themselves. But such clients are left with the significant overhead of running a number of disparate agencies. With a view to becoming IMC-equipped, many large advertising agencies have acquired specialists in other marketing communications disciplines. By working with such agencies, clients need to only brief, manage and monitor one agency as opposed to running a portfolio of different specialists.

But even if an agency is capable of implementing an IMC programme, is it really possible to “integrate” the various media and channels this way?

Sorab Mistry, Chairman of McCann Erickson India, believes that such integration is possible, provided IMC is made an integral part of the initial brand communication strategy. He says, “While an effort to do this is made by some clients, most often than not advertising gets the most attention. All other IMC disciplines are initiated tactically – often on an ad-hoc basis. To add to the problem, due to cost considerations, activities like promotions, merchandising and database marketing are often outsourced to smaller outfits by the client at a much lesser cost – thereby, sacrificing the ‘integration’ aspect of the effort.”

Cost-Effectiveness
Advocates of IMC claim that integrating marketing communications helps clients get efficiencies and economies of scale with design, production and implementation of their communications programme. But practitioners differ somewhat.

Parameshwaran says, “There may not be economies of scale in conceptualising and designing an integrated campaign. In fact we need to not just look at economies of scale but look at what is right for the medium and spend the requisite time and effort to make sure that the message is suitably adapted to the medium concerned.”

Mistry echoes the similar sentiments, “While some economies of scale can be gained, it is important to note that the evaluation of IMC programs should not be on the same parameters as advertising. For example, cost per contact is often significantly higher in IMC programs when compared to advertising. Very often, both client and agency consider IMC as the “cheaper option” to advertising. This obscures the key role that IMC plays in brand communication.”

A Collaborative Strategy
Effective IMC requires coordination on strategy as well as tactics. It is not simply a question of coordinating implementation. Collaboration at the research and planning stage is essential. To be effective, this collaboration requires an understanding of the different roles that different techniques play in the marketing communications process (e.g. promotion might prompt trial but only once public relations has raised awareness).

Mendonza clarifies, “No integrated marketing is possible without a complete bonding of client-agency thinking. And this does not mean just the policy-makers and managers at the client’s end, but also the salesman in the field. Eventually he is the man who is going to clinch the deal. He has to speak the same language. Only then will there be magic in the integrated message.”

Customer-Oriented Approach
The importance of consumer orientation in IMC cannot be sufficiently emphasised. For any marketing communication campaign to be able to produce effective results, it must solidly be anchored on a deep understanding of the consumer.

A key shift that must take place in client organisations is the shift from inside-out thinking to outside-in. Outside-in thinking is integral to IMC for it zooms into the consumer or the publics that are the objectives of any marketing campaign, thinking of the needs and wants of these markets and producing products and services that meet these needs. This is in contrast to inside-out thinking wherein strategic processes are grounded on financial analysis of sales, marketing and profit goals instead of the consumer where they should be based on. In such scenario, first priority is given to manufacturing a product and then finding a market to sell it in. Such outmoded pattern of thinking may not survive in today’s modern world.

To effectively direct messages to, and affect the behaviour of consumers, brand communications programs should incorporate segmentation/aggregation, customer valuation, and database management. An IMC programme uses sophisticated tools for customer management and data mining to:
– Segment and target audiences or individuals and,
– Monitor the efficiency and effectiveness of the campaign.

Technology is playing a key role in enabling this. For example, new media channels allow greater targeting (e.g. One-to-one real time marketing) and interactivity so that a return path of information may be established with customers.

IMC IN PRACTICE
TATA INDIGO
A recent example is the launch campaign of TATA Indigo, the new car from Telco. The launch integrated all the elements of IMC to give one message of ‘Comfort and Luxury’. This message and the visual of the ‘Arm Chair’ was used in a variety of media vehicles, including newspapers, magazines, TV, outdoor, merchandising, mailers, website, event design, brochures and even invitation card to the launch event. Parameshwaran, whose agency was behind the IMC campaign, emphasises, “Coordinating the entire campaign called for a lot of effort, since you had to use the key elements of the message and adapt it to the medium concerned. The arm chair may look very nice in press ad, but how will look on stage, or on a banner ad on the website? But overall the integration has had a tremendous effect on the brand Tata Indigo. No one got a message from any source that was not aligned to the strategy of comfort and luxury.”
DAIKIN AIRCONDITIONERS
McCann Erickson India has used IMC for General Motors and the launch of Virgin Atlantic. Philips Similarly, Rediffusion DY&R’s campaign for Daikin Air-conditioners is also on the lines of IMC. Mendonza explains, “The message of ‘complete silence’ has been taken across not only press, TV, outdoor, retail and website advertising, it is even used by dealers and sales personnel in the field. They sell the Air-conditioners on a technology platform which single-mindedly translates into it being more silent than other Air-conditioners.” And the result has been very encouraging – the IMC campaign is doing wonders for the product on the sales front – this despite of Daikin being about 20% more expensive than other air-conditioners in its class and not once resorting to promotions, discounts etc.
INGREDIENTS OF SUCCESS
So what are the ingredients of a successful IMC programme? Mendonza thinks the answer lies in simplicity. He says, “The message has to be interesting, simple and single-minded in the first place. This is easier said than done. (That is why there are such few really good campaigns doing the rounds.) Most products and services today, have the same offering. So you can only occupy the consumer’s mind-space if you offer that same thing in a totally refreshing way. Getting to that ‘refreshing way’ itself takes tremendous common sense, hard work and smart thinking. So it only follows that once you find that way, you own it. And you can only own it if you are focussed and integrated with your message across all media. Otherwise, there is too much noise and clutter happening out there to get even halfway across to the consumer’s mind.”


Resistance to IMC
While the logic of IMC appeals to most marketing practitioners, there are many who resist integrating their communications efforts.

Inertia
The first and foremost reason for resistance is inertia or refusal to change – any attempt to change the so called “tried and tested” recipe tends to encounter resistance. IMC requires a complete re-structuring of the mindset towards marketing communications – both at the client side and the agency side. For most managers, this is a difficult task to embark upon.

Nothing New
Most clients and agencies think that IMC is simply old wine in a new bottle – that the use of multiple communications tactics, coordinated campaign themes, and consistent graphic or corporate identity has always been employed. But Mistry is quick to point out the flaw with this kind of thinking, “This may be true to some extent. But as I mentioned above, more often than not, IMC plans are worked out more on an ad hoc basis and not as an integral part of brand communication. Mere use of the communication discipline does not make a campaign integrated.”

According to Parameshwaran, brands for have attempted to integrate the look and feel across media for a long time. But the last five years has seen the emergence of many new media opportunities, Internet, Events, Product-placements, etc. So the task has become a lot more complex. It is this increasing complexity that calls for a holistic and synergistic approach towards marketing communications.

Complex Planning
Complex planning is another deterrent. The integrated marketer can select from more than 20 tools, from advertising to in-store merchandising to promotion to public relations to database marketing to the Internet. This often requires detailed and long-term planning at both the client and agency levels.

Marketing is often viewed as cost, rather than investment. This tactical – rather than strategic – perspective works against planning and preparation, which is the foundation of IMC. Planning helps in deciding the communications strategy that ultimately helps in optimising the marketing spends. Parameshwaran says, “A marketer who wants to use the various tools of IMC has to be clear what is needed to reach the target consumer and what is the time and money available to do the job. There is no point in doing what we call a ‘GangaJal’ IMC, a little bit of everything. It is better to focus efforts, if the target audience can be reached through one or two media and the budget is limited.”

Lack of Initiative
Many clients blame the agencies for not initiating IMC. Kotler writes, “Most agencies have not done a good job of putting together all the different teams and organisations involved with a communications campaign.” To this Mistry adds, “Agencies themselves have not given adequate focus to IMC. It is often treated as an appendage to the mainline agency. While agencies need to invest more into IMC – in terms of people, tools & research – it is also necessary to educate clients on IMC thinking. Even if agencies do not have the wherewithal to handle the entire gamut of media involved – they could outsource the implementation to specialist outfits – it is important for the dominant agency to be involved in developing the IMC programme.

Accountability
Accountability or the problem of accurately measuring the effectiveness of the various disciplines used also discourages clients from using IMC. The client always wants the highest possible ROI on every buck he spends. Lack of guidelines to evaluate the IMC programme is also an impediment to IMC programmes.

Parameshwaran feels, “A marketer needs to have some form of measuring the impact of each of the IMC tools and also factor in that they always work in tandem. Like: What is the number of unique visitors to the website, how many people came to the event etc. need to be tracked? But the metrics need to be different from the classic, cost per thousand. At an overall level the marketer needs to see the value of an IMC programme and the synergistic effect of the various media on the brand. And that calls for a ‘gestalt’ view of the role of marketing communication, a view that is a lot more than just numbers and figures.”

But Mistry disagrees. “The issue of accountability is often misunderstood due to a lack of guidelines to evaluate an IMC program. Agencies need to develop tools for this. Given the fact that clients have started investing in IMC tools to measure effectiveness will follow”, he says.

Wrapping up
IMC is not a management fad, but is a fundamental and marked shift in thinking and practice of marketing communications by clients and advertising agencies. A quick market scan proves that IMC is being taken seriously and is being practised by a significant group of marketing communications practitioners. The primary value that agencies see with IMC is the consistency, impact, and continuity which an integrated programme provides.

The critical issue concerning IMC is that of evaluation and measurement of integrated programmes. Part of the difficulty is that traditionally advertising, sales promotion, direct marketing, and the public relations disciplines have developed separate and distinct measurement approaches. The measurement of integrated programs which can estimate the synergy between elements is a totally new field which remains relatively undeveloped.

IMC is a new approach to marketing communications planning being driven by technology, customers, consumers, and by organisational desire to efficiently allocate finite marketing resources. IMC is still an emerging discipline. We are living in a period of transition between the historical product-driven outbound marketing systems and the new information-driven, interactive, consumer focused marketplace of the twenty-first century.

References/Notes

1. B&W Paper: Integrated Marketing Communications – Back to the Future? by Paul Noble; Noble Ink, July 20022. Re-intermediating the Media Plan by Michael Goldberg; Brandchannel.com

3. What is Integrated Marketing Communications, Currents, Volume 17; Tucker-Knapp Inc

4. Revisiting the Concept of Integrated Marketing Communications: Contrasting Perceptions between Marketers and Advertising Agency Executive; Department of Commerce, Massey University, Auckland WORKING PAPER SERIES No. 98.08

5. Integrated Marketing Communications: Pulling it Together and Making it Work by Schultz, D.E., Tannenbaum, S.I., & Lauterborn, R.F. (1992). NTC Business Books

6. IMC and the Future of Marketing by Jerome Kliatchko, European Association of Communication Agencies, 2001

7. Contemporary Advertising, Arens and Bovee, IRVIN, 1994

8. Marketing Management (11th Edition), Kotler Philip, Pearson Education, 2002