The "gross margin negative business model".

The recent article in ET on "How success of e-commerce start-ups are making traditional retailers rethink their model" was interesting reading, however, what was more interesting was the view of Mr. Biyani. On this one (the two points he makes) I agree with him.

The darling of everybody at this point in time is "the great ecom experience", however, the business viability & margins on transactions are the elephants in the room that are getting ignored. The gross margin negative businesses are not sustainable and are completely dependent on the VC funds for survival - a fact validated by a number of business leaders who were unable to raise a 2nd or a 3rd round and ended up shutting the once 'viable ecom' business.

Another article worth reading on the subject is Issues with Inventory models .  

Looking forward to see how the category progresses and the models that will finally sustain.  

Related articles

• From the web to the consumers' doorstep; enabled commerce for FMCG brands.
• The changing profile of Indian retailers & AaramShop.
• The truth vs hype of big retail.
• The future of commerce is a hybrid model with (entertaining) showrooms + online fullfillment

Neighbourhood kirana shop is spiffing things up.

Business Today examines how the traditional trade stores (general trade stores) are managing the challenge posed by the large format modern trade outlets in markets like India. 

The feature examines both the initiatives taken by the owners / retailers themselves and the support that they are getting from multiple organizations like AaramShop not just to stay competitive but to thrive.

Read the full article here

Related articles

• Networking the neighbourhood kirana @ AaramShop
• Who Wins? Modern retail chains or Mom and Pop stores?

Point of Sale has moved - from the store to the consumers’ home.

Traditionally FMCG brands have focused their marketing efforts on ensuring high brand visibility at the stores & while that is critical – there is an aspect that might be getting overlooked.

Home Delivery!!

The new point of sale is the consumers' home.

Home Deliveries are the backbone of the general trade in India. Our research has revealed that some of our AaramShops have as high as 55% of their business from home deliveries, while the average home delivery business across urban stores is a high 32%.

The prevalence of such a high level of home delivery across urban centers of India warrants a strategic rethink by brands.  The challenge with home delivery is that the consumers are just not walking-in to the store, as the orders are getting placed on the phone or online. Obviously the last mile visibility & communications strategy is not working for these consumers.

The solution lies in reaching the consumers in their homes, and influencing the buying decision right where it is made.   

At AaramShop, we have custom created unique solutions to tap this huge opportunity – we have the network, the coverage & reach, the technology and fine-tuned processes to ensure that brands can influence consumers to get a place within the home delivered orders. 

Talk to us if you need help in reaching your brand communication, offers and promotions directly to consumers and have them serviced via AaramShops.

Related articles

• AaramShop's Mobile Coupons.
• 2000+ AaramShops to choose from.
• Free Services Available for Brands on AaramShop
• Integrating the moments of truth for FMCG brands.
• Why digital & why AaramShop

EveryWhere Commerce.

The ‘e’ in ecommerce no longer means electronic, it means everywhere.

Ecommerce is defined as the process of buying or selling over electronic systems, but as the shopper's experience has become more complex, the 'e' in ecommerce no longer means electronic, it now means everywhere.

The Harvard Business Review asked in 2011: "Is it an e-commerce sale if the customer goes to a store, finds that the product is out of stock, and uses an in-store terminal to have another location ship it to her home? What if the customer is shopping in one store, uses his smartphone to find a lower price at another, and then orders it electronically for in-store pickup?"

From the customers' perspective, they now expect access to the whole catalog, not just the range of goods in a particular location, and they expect this catalog to be available whenever and wherever they want it. People can shop potentially every minute of the day.

From the companies' perspective, there is an opportunity to connect with shoppers and have a much fuller relationship than traditional, mainstream bricks-and-mortar retailers ever did.

Download the full report on Future Shopper from here

Introducing AaramOffers.

For more information on AaramOffers by AaramShop, and how they can be used by retailers visit the Channel Engagement Center

AaramOffers are hyper-local offers on grocery and daily essential products, that enable consumers to find the best offers within minutes from their homes and have them delivered at their doorstep.

AaramOffers are currently restricted to retailers within India.

 

Related articles

• From the web to the consumers' doorstep; enabled commerce for FMCG brands.
• The internet & The Local Business.
• Examining the rise and rise of e-commerce: 2013 retail trends
• The high street and ecommerce: friends, foes or something in-between?
• Reaching A Diverse Target With Your CPG Brand

A New Era For Experiential Marketing

Experiential marketing has been around since the days of the traveling salesman. But with a strong assist from technology, it now it is re-emerging as the backbone of many branding plans.

Came across this wonderful article on CMO and felt it was worth sharing. 

The article captures the key changes and the fact that the empowered consumer has made experiential marketing a necessity in some areas, such as retail and electronics, where showrooming is turning products into commodities. 

And with the rise of online and mobile shopping empowering consumers to commoditize products, a tactile experience becomes a good way to set one product aside from another.

Read the full article here on CMO

Related articles

• Participation Marketing
• Digital.Experience - what's it all about? [Richard Carman]
• Marketers' Approach to Mobile is (Still) Flawed
• 14 Retail Executives Share Technology Predictions For 2013

Superb Marketing Campaign for Nature Valley Granola Bars.

This is a fantastic marketing initiative by General Mills Nature Valley Granola Bars.

Awesome objective, great strategy, superb brand fitment and creation of not just a great campaign, but something that will be used for years on end by a thankful target audience. 

I rate this as one of the best marketing initiatives that I have come across. 

The video link below captures the process and the impact and I would suggest that you experience it here on the website

Maybelline - superb initiative.

Loved this campaign overall - great mix of technology and creativity. Loved how it is well designed to be used across devices from pads to PCs to mobiles. 

Very impressed with the way Maybelline has leveraged Pinterest, whose ties to fashion and beauty made it the right medium in which to extend the campaign. 

Visit the Maybelline - Color Show here and explore the color wheel

The changing profile of Indian retailers & AaramShop.

A typical Indian Neighborhood Grocer

Kamal Desai is the 2^nd generation grocery retailer based out of Andheri West, in Mumbai. He took over day-to-day management and operations of his family-owned grocery store about 9 years ago.

The 9 years of running his store 1^st hand and assisting his father since early childhood enables Kamal to reflect on changing trends in Indian retail and its opportunities and challenges over the last 4 decades with a level of expertise.

The changes have been happening over the years, but the last 7 to 8 years have been the most exciting and challenging. Based on what he saw around, he started off by doing minor modifications to the store layout since he took over – starting with creating self-service isles, better product displays and accessibility, in-store lighting and then going on to air-condition the store.

While the neighborhood that Kamal services has seen a steady population growth and income levels, it has also seen a change in consumers’ tastes – prompting Kamal to move away from commodities to brands. And while Kamal has a strong one on one relationship with a lot of consumers and almost a legendary service level efficiency for loyal consumers – he is facing an increasing challenge with the changing lifestyle of a number of his consumers and of course from the increasing competition from the modern trade outlets.

India Independents' Day on 16th of August.

15th of August is the Independence Day & 16th of August is going to be the Indian Independents’ Day. 

Independents’ Day will fly the flag for local retailers across the country: the businesses and the people behind them, who help make our villages, towns and cities so diverse, colorful and so very special. It’s all about championing diversity and recognizing the skills, efforts & the free spirit behind the shop-front. 

The day will highlight the important role smaller, local, independent retailers play in our local communities they have been serving for generations, the local economy they contribute to, and in the retail sector as a whole. 

The focus of the campaign is multi-fold: 

Encouraging consumers to shop local, to celebrate their favorite independent retailers, to remind themselves of the fantastic shops within their neighborhoods, and to go out there and bring forth that love.

Encouraging independent retailers to create a buzz to increase consumer engagement, footfall and sales. To let everyone know that they are proud of the contribution their small business makes. 

Encouraging suppliers and all those who serve the independent retail sector to spread the word. To support the retailers in delivering experiences, to add to the excitement; remembering that Independent Retailers are often a critical route to market for a wide range of product designers and producers. 

My organization (AaramShop) will support this initiative in multiple ways and would like to welcome supporters of the Independents to come together in various ways to show our appreciation and support. 

To get involved in the initiative as an individual, corporate, government or association; please write to me.

"Clicks to Bricks" integration for FMCG brands' digital campaigns.

The growing importance of digital marketing is not lost on anyone. However, most brand marketers in the FMCG / CPG space find it difficult to justify the high engagement cost per consumer, especially because most current digital assets are restricted to creating awareness. 

There is now an option to change that. AaramShop has digitized the FMCG brands' existing last mile, thus enabling an integration of a “purchase now” prompt option within all digital assets. 

The consumers can now browse through all manner of digital communication, have the additional option to click on a “purchase now” tab, enabling them to order a brand from their preferred neighborhood retailer, who packs up and deliver in a matter of hours. 

Here is a neat example of seamless "Click to Brick" integration by Saffola (Marico Industries) giving its consumers a “purchase now” option on its website and at the same time it helps build a stronger bond with its channel by helping generate direct demand and action specific to the retailer outlets.

All digital assets of the brand like its websites, social media presence on platforms like Facebook, Pinterest, Twitter, etc, review sites, blogs etc and and digital marketing campaigns can be now made to perform harder for the marketing dollar spend, and go beyond the just feel good awareness.

.

Related articles

• The Truth About What Works in Digital Marketing.

  ---

• AaramShop launches AaramTV to help FMCG brands narrowcast their brand messages at the neighborhood grocer.

  ---

• CPG & eCommerce - the new approach.

  ---

• Digital Influencers of Brand Selection.

  ---

Where tomorrow‘s customers will place their trust.

One thing is clear: mass marketing has had its day. For decades people have consumed what they learned about through the constant barrage of advertising – and what was available in the shops. Retailers stripped their shelves of everything that only sold occasionally, in order to free up valuable shelf space for the real top sellers.

That is all in the past. In the new online economy of the “long tail”, providers increasingly earn their money with niche products. Thanks to limited costs for storage and for the “showroom”, it is well worth their while to offer the unusual and the quirky as well.

Consumers like niches. They no longer want to be one of the masses; they want to own things that are rare and unusual. Small groups of aficionados grow up – “social networks”, which replace the mainstream as a peer group.

These networks take over the job of communication. Information about “cool” new offers travels round in no time. Providers who want to be noticed in increasingly fragmented markets must therefore make themselves visible in these circles.

The explosion of choice makes heavy demands on consumers. To reduce the flood of information, they go along with a calculated risk: they trust the recommendations and tips of others. They increasingly take decisions for emotional rather than objective, factual reasons.

Read the report here

Related articles

• What does loyalty marketing mean for CPG marketers?
• Cross-Channel Approach to Consumer Marketing.
• Multichannel Campaigns Increase Reach, Branding Potential
• Mobile Device Owners' Local Searches Often Lead to a Purchase: Study
• No, Social Can't Predict the Oscars, But It Can Award a 'People's Oscar'

The Social Media Advocacy Model

In theory, as social media becomes more common place, organizational audience engagement objectives, strategies and tactics should evolve past acquisition towards advocacy. Mark Smiciklas is quite sure some consumer brands are heading in this direction but, in his experience, many companies and agencies still seem to be focused on driving audience awareness and using “likes” and “follows” as success metrics.

To spark some discussion on the topic Mark thought it might be helpful to present an encapsulated view of advocacy. This brilliant infographic aims to present advocacy at a glance, explaining where it sits on the audience relationship spectrum while visualizing the steps organizations can follow to move connections towards becoming advocates.

Here are a few notes on the process and the model:

Related articles

• When ROI Represents the Realization of Influence
• New Survey Spotlights Need For Personalized Offers and Communications
• Content: The New Marketing Equation
• A Critical Path for Customer Relevance