Budget Woes

Written by: Nithin Narayanan

 Nowadays there are quite a few researches that I come across about retail. One such study is about the impact of organized retail on small retailers. This study is conducted by ICRIER-Indian Council for Research on International Economic Relations. In all probability this study would be submitted in the month of March.

 
The result of the study would indeed affect long term policies of the government concerning retail. At present the government allows 51% FDI for single brand retail while multi brand retail stores are not allowed entering the domestic scene. Due to this retail giants like Wal-Mart is resorting to cash and carry format.

 

Like always there are great expectations associated with the Budget. As far as retail is concerned, many feel that retail sector should be liberalized. That is 100% Foreign Direct Investment. FDI would mean will usher investments thus creating situation where consumers would have access to better quality products at cheap prices.

 
Another aspect is granting industry status for retail. This would facilitate establishment of regulatory agencies and thus enhancing quality and thus streamlining process in the sector.

 
Besides this, 100% FDI would create employment in India. Organized retail is growing at 35% annually and unorganized retail at 6%. Hence organized retail would create a large number of opportunities for the youth of the country.

 
Finally Service tax is a major concern. Service tax is levied on rentals paid for immovable properties occupied by retails.  This results in goods becoming expensive for the customers. This is one of the reasons why retail is operating under thin margins.

 
Let's hope that this Budget would change the situation for the common man and also for the businesses across the country.

Product Promotion

Written by: Nithin Narayanan

 I have earlier written about Visual Merchandising which is facet of product promotion. Promotion is an element of the marketing mix. The word promotion is popularly defined as 'an effort to further the sales by means of advertising, publicity, events and display'.

 Advertising- There are two types of store advertisements.

 
Brand Advertisement- This kind of advert gives significance to the image of the brand. It draws attention to the store rather than a particular product.

 
Merchandise Advertisement--This aims at selling specific product highlighting, at times its features or benefits.

 
Publicity- The idea behind publicity is to bring their brand or product out in the open to wet the appetite of the customers. Publicity helps in promoting sales by popularizing a style.

 
Special Events- Events are organized to bring potential as well as prospective customers together to the store or event or exhibition to create goodwill. Some other events include anniversary celebration invite regular customers. Advertisement in media is also given so that more people visit the special events.

 
Visual Presentation- This deals with In-Store Communication dealing with displays and Window Dressing. Proper planning goes into implementing effective display.

 
Direct Selling-Direct Selling is often used to promote FMCG products by way of door-to -door selling or by group selling at public places .Multi Layer Marketing is also a kind of Direct selling. Amway is a good example of MLM.

 
These were some of the mediums which brands employ to promote their merchandise. New media in terms of internet, gamming and films are also proving to be effective mediums of promotion.  In the coming years, these mediums would be used more often than the traditional mediums.

 

The business of 3M

The company operates through six business divisions: health care; industrial and transportation;display and graphics; consumer and office; electro and communications; and safety, security, and protection services.

The health care division serves the medical, surgical, pharmaceutical, dental and orthodontic, health information systems, and personal care markets. The division offers products such as medical and surgical supplies; skin health and infection prevention products; pharmaceuticals; drug delivery systems; dental and orthodontic products; health information systems; microbiology products; and closures for disposable diapers.

The industrial and transportation division serves a broad range of industrial markets, including appliance; automotive; automotive aftermarket; marine; aerospace and specialty vehicle markets;electronics; paper and packaging; and food and beverage. The division offers products such as tapes; coated and non woven abrasives; adhesives; specialty materials; supply chain execution software solutions; and components and products used in the manufacture, repair, and maintenance of automotive, marine, aircraft, and specialty vehicles. The transportation products include insulation component, catalytic converters, functional and decorative graphics, abrasion resistant films and fasteners. Its brands include Scotch Masking Tape,Scotch Filament Tape, and Scotch Packaging Tape.

The display and graphics division serves markets such as electronic display, touch screen, traffic safety, and commercial graphics. The optical film business, a sub-segment of the display and graphics division provides films that serve various market segments of the display lighting industry. The display and graphics division provides products for five market segments, including liquid crystal display (LCD) computer monitors; LCD televisions; handheld devices such as cellular phones; notebook personnel computers (PC); and automotive displays. Additional optical products include touch screens, touch monitors, and lens systems for projection televisions. In traffic safety systems, the division provides reflective sheetings used on highway signs, vehicle license plates, construction work zone devices, trucks and other vehicles, and pavement marking systems. The commercial
graphic product segment includes equipment, films, inks, and related products used to produce graphics for vehicles and signs.

- Contributed by Vaibhav Agarwal

The Art of Displaying

Written by:Nithin Narayanan

 
The word Display means 'to put out to be seen or to exhibit'. Exhibiting is indeed an art. But in retail as it is a commercial space, it should be profitable also. The process of display has been in vogue for quite some time now. At the first glance, display seems an easy task to handle but on a pragmatic level it is difficult to execute.

 
A prominent part of display is Fixtures. There are various types of fixtures available. Also fixtures can be custom made if the fixture doesn't suit the needs of the retailer. Broadly fixtures can be categorized into the following-

 
Slat Wall

Grid Wall

Counter Displays.

Racks

Gondolas

End caps.

 
There are newer kinds of fixtures in the market. Choosing the right kind of fixtures could be a daunting task. These fixtures play an important role in the interior as well as the theme of the store. Fixtures now can be adjusted according to the requirements, thus creating flexibility in showcasing the merchandise.

 
But flexibility does not ensure that all kind of fixtures are suitable for various types of stores. For instance, a jewelers store may employ Acrylic and mirror displays to enhance the glossy look of the products and the whole feel of the store.

 
The materials used are also important as durability and maintenance is crucial for retailers. Newer fixtures are light weight, transportable, easy to handle which makes them popular choices. Fixtures made up by metal are used now days. Metal fixtures are fast replacing conventional fixtures made of wood. Various kinds of finishes are also available which could be applied to either wood or metal.

 
With the constantly evolving designs and wide range of fixtures, retailers have a myriad of choices. Retailers must focus on their needs such as cost, format, merchandise type, maintenance, and materials.  One last thing that is significant while choosing fixtures is that the fixture should not be more attractive than the showcased product. It is a 'means to an end not an end in itself'.

 

History of Yahoo, Microsoft and Google : The BIG Internet war

• 1975: Microsoft founded.
• 1995: Yahoo founded, begins serving ads online. Microsoft launches MSN Web portal.
• 1998: Google founded.
• 2000: Yahoo starts delivering search results generated by Google's technology. Google introduces AdWords, its system for displaying ads next to search results based on keywords used.
• May 2001: Terry Semel becomes Yahoo's chairman and CEO.
• February 2002: Microsoft taps Overture Services Inc., later bought by Yahoo, to power its advertising-driven search engine. Google overhauls AdWords with cost-per-click model that makes online advertising easier and more cost effective for smaller businesses.
• May 2002: AOL picks Google as search and advertising provider.
• 2003: Google AdSense launches, letting outside Web sites make money by plugging in targeted text ads by Google.
• October 2003: Yahoo announces plans to buy Overture, giving it a system for selling search ads similar to Google's AdWords.
• February 2004: Yahoo replaces Google search results with its own technology.
• April 2004: Google launches free e-mail service Gmail, expanding ad opportunities.
• August 2004: Google holds initial public offering.
• December 2005:Google makes $1 billion, 5 percent investment in Time Warner Inc.'s AOL and extends ad partnership.
• May 2006: Microsoft's launches own Web ad platform, adCenter. Microsoft signs up Facebook as first big client.
• August 2006: Google wins search and ad deal with News Corp.'s MySpace and eBay Inc.
• October 2006: Google announces plan to buy YouTube for $1.65 billion, giving it a highly popular video-sharing site on which to sell more ads.
• November 2006: Yahoo builds advertising partnership with consortium of daily newspapers.
• February 2007: Yahoo launches long-awaited search and advertising technology overhaul, known as Panama.
• April 2007: Google agrees to pay $3.1 billion in cash to acquire ad-management technology company DoubleClick Inc. Yahoo acquires online advertising exchange Right Media Inc. for $680 million.
• May 2007: First rumors hit Wall Street that Microsoft is contemplating Yahoo buyout. Yahoo CFO Susan Decker promoted to oversee advertising operations. Microsoft says it will buy online ad company aQuantive Inc. for $6 billion in cash.
• June 2007: Semel steps down as Yahoo's CEO; co-founder Jerry Yang takes over. Decker becomes president.
• July 2007: Yahoo launches SmartAds, a behavioral, demographic and geographic ad targeting system.
• August 2007: Microsoft buys AdECN Inc., a stock market-like Web ad exchange. It also launches ContentAds, context-relevant ads on some sections of MSN.
• September 2007: Yahoo announced plans to buy online behavioral targeting specialist BlueLithium Inc. for $300 million in cash
• October 2007: Yahoo announces plans to buy AdInterax, a rich media ad business, for undisclosed amount. Microsoft spends $240 million on a 1.6 percent stake in Facebook, ensures ad partnership will continue.
• December 2007: Microsoft steals Viacom ad business from DoubleClick. Other ad deals since the acquisition of aQuantive include financial news site CNBC.com and Digg Inc., a reader-powered news site. Google's proposed buyout of DoubleClick gets green light from U.S. regulators, still pending in Europe.
• January 2008: Semel resigns as Yahoo's chairman. Microsoft makes unsolicited $44.6 billion offer for Yahoo.

Contributed by Vaibhav Agarwal

Experimental Marketing

Written by: Nithin Narayanan

In the market today, there are lot of Me-too products available be it any product or merchandise category. Consumers are exposed to adverts the moment they switch on the television or radio. Service providers use transit advertising to the maximum to get the attention of the customer.

But customers see value as a balance between benefit and the cost to acquire that product or service. No matter how much advertising and marketing is carried out, if the product is not good and it does not satisfy the need of the customer, the product concerned is termed a failure.

These theories of benefit and need base positioning is a facet of Traditional Marketing. Experimental marketing comes into play where there is an increasingly growing demand to incorporate consumer in every possible way as to make company and the product an integral part of consumer's life.

This kind of marketing is not In-Your -Face type but more subtle in approach. The very focal point of Experimental Marketing is to instill good experiences and in turn satisfy consumer aspirations. On the other hand Traditional Marketing revolves around promoting the brand as better than the others.

The gamut of Experimental Marketing can be extended to Consumer Relationship Management (C.R.M). Once retail scenario develops, it would lay more significance on creating positive experience for the customer. In turn this is directly related to the quality of the In-Store Retail Executives. In India, many retailers are more concerned with the number of stores than the quality of operations specifically CRM. One startling aspect between retailers in Metropolitan cities and Tier II and III cities is that retailers in smaller cities go that extra mile to satisfy the customer. Whereas in Metros, retailers are more business centric than people centric. They fail to understand that management is truly all about people. This also reflects in their marketing communication which is Product centric.

Experimental Marketing is one must remember is a way, a process not an end in itself. It is a means to an end. Consumers are much more educated and aware now and know exactly what they want. Examples such as Tivo, customized services, a few years back- Gmail , pop up blockers reiterates that experimental marketing is preferred. Experimental Marketing is also termed as Customer Experience Marketing.

Customer experience framework would consists of these following steps-

Knowing your customer.

Establishing experimental platform.

Implementing the experimental platform.

Carrying out and engaging in innovation.

During the past decade Experimental Marketing has come to the forefront in branding world. Many global companies have successfully carried out these theories and constantly engage in research to further marketing novelty.