Got Milk? - The Indian Dairy Context.

Monday, November 16, 2009

SHOP FLOOR; THE NEW PRIME TIME. Trend No. 1

1. THE FLOOD OF OPTIONS;

We are seeing new products and enhanced features within products introduced at a mind – boggling rate, and the lifestyle of individuals have become increasingly multidimensional and multifaceted. With so many added choices, customers have more purchasing decisions to make and these decisions are more complex than ever before.


Gone are the days when the consumer used to watch a TV ad, “become aware of the brand name” and then walk across to the store and ask for the brand by its brand name. That used to be a done deal!


Today, a consumer is faced with a plethora of brand options to choose from in any category – and not merely from amongst the brands, but also from within the brand. Take for example a rather “simple” decision of buying a tube of toothpaste - it is no longer enough to decide from amongst the brand names, but also from within countless features like, extra whiting, vs. tartar control, vs. mint or other flavors, vs. medicated, vs. specially formulated for kids or older folk, vs. blue or red colored pack, vs. extra volume, vs. what appears cool & new in the retail shelf to even vegetarian or a non-veg and lots more reasons.


A consumer is induced to switch his preference within the brand and overtime also amongst variants across the category. The consumer is less likely to be loyal, more open to experimentation and more likely to change his mind based on what he sees on the shelf.


This flood of options leads the consumer to take his brand decision not based on what he sees on the TVC or print, rather on what he sees on the retail shelf on that day!

Shop Floor; The New Prime Time.

Prime Time ; A boon for brand marketing folks worldwide… it was a time when consumers would sit-back, glued to their TV sets taking in one soap or the other, or a game, or news or a movie and along with it absorbing a healthy dose of creative commercial messages which wet their appetite for the brands.


Logic had it that more the amount of noise created, the more liberal the usage of sexy celebrities, the more dazzling the production quality of the TVC - the higher the resultant brand recall. It therefore, surmised (almost) that the consumer would walk-up to the store, seek out and purchase the brand which had the highest recall in his mind.


As a result this thought process; the brand marketing folks have chased that prime time spot to stay “relevant” in the consumers consideration set. This chase is now a habit – almost a compulsion and an obsession – consider the fact that most of the industry dialogues seem to be completely focussed around the world of that 30 sec TVC.


Getting the consumer to be “aware” of the brand is something which everyone has focussed on for a while, albeit the dependence of mass-media for the same has been the chosen route. Thus it has been the one-way, single message for all, top-down communication which has dominated the thinking process.


However, for a consumer to progress in his mind and actions through his “path to purchase”, he has to undertake a process of 1st changing from a consumer to a shopper into the category and then from a shopper to a buyer of the brand and while awareness creation in the mind of the consumer is a critical 1st step, it is perhaps only the starting point.


The much discussed “path-to-purchase” model (figure 1.1) does a great job of explaining the consumers’ progressive levels of engagement with the brand and defines the path to purchase that a consumer moves through. It also explains the typical media vehicles or other experiential tools which can be used to influence behaviour. The funnel also represents the attrition / reduction of number / volume of consumers’ at every stage of the “path to purchase”.





Interestingly, while this model does not necessarily attempt to comment on the way brands needs to prioritize their overall marketing spends, brands have, over the years mirrored their marketing spends as per the funnel, with the maximum spends going into creating awareness (at the top of the funnel) and minimal amounts in the last mile (at the bottom of the funnel) to ensure conversion and sales.


There was a time, many years ago, when this logic made sense in terms of ensuring a wider reach, effectively informing customers, creating desire, etc. In those days the business logic of marketing would be simple; create a product, create an exciting story around it (read ad), make people aware of the product/brand and ensure it is made available in the shops – consumer will queue up and buy. The more noise you make – the more people will buy!


Today that hypothesis does not hold true. There is a massive shift in the way a brand should allocate its funds across the path of purchase. A brand now has to not merely tweak its allocation of funds towards the path of purchase; it has to completely re-invent its allocation logic.


Time is ripe to reverse the allocation. A brand should and needs to spend the largest share of its budgets in the last mile (lower stages of the funnel) as against on creating “awareness and recall” of the brand.


Let me share some of the current and evolving consumer behavioural trends I have observed, from around the world, which make the need of this change real and urgent, please visit the blog and view the 10 specific trends as I see them;

Saturday, November 14, 2009

SHOP FLOOR; THE NEW PRIME TIME. Trend No. 5


5. “ROBO” IS FOR REAL;

It is well understood that the consumer is spending a lot of time online, in a lot of cases much more time than what he spends in front of the TV set or reading print. And this share of time is increasing at a feverish pace.

When online the consumer does his research on the brand, this research can be a combination of self driven or could be triggered by peers on his social networks.

The more expensive the purchase, the more involved and extensive the research.

This is far more relevant because this is where the consumer spends time engaged in the category, seeking and deciding what alternatives he has options of. This is when is willing to form opinions and is willing to read and listen to referrals.

Most importantly, this is one dialogue process where the consumer is completely in control – he not only chooses the time and level of dialogue, if he does not like what he sees he can merely click it away and move else where.

The consumer is not closed to any brand in this stage – he is in fact in a “SELL TO ME” mindset, which has been well captured by Yahoo and exploited to the fullest by Google by their huge success of Adwords platform. This process is radically different from the one way communication which he gets subjected to in a TVC, print ad or a hoarding.

Putting up the brands’ TVC on Youtube.com is not the answer, ensuring that the brand participates in the “search” journey – by providing access to relevant data & information on brand comparison of features, USPs, costs, etc, and enabling communication with the user community and engaging with the user community - is the answer.

While brand owners have started spending an increased percentage of their budgets online (and is growing) – for a number of brands that spend still is backed by the “awareness creation” thought process, rather than focusing on the consumers search for information journey.

This integration of shopping with technology is real. 87% of US consumers research products online before buying them in person or in a store.

However across categories…the major buying still happens off line.

ROBO = Research Online Buy Offline.

This is not limited to B2B products or big ticket purchases like computers, phones or cars, but extends across all categories.

The consumer spends his research time comparing features, absorbing user experience reviews, understanding costs.

All this before he heads out in the last mile, to check out the physical experience and then buy.

To get into the consumers mindset, presence in the last mile needs to be preceded with relevant presence in the online search process.

Wednesday, November 4, 2009

BTL trends in Russia.

Please read the recent report in The Global Marketer here.

Thursday, October 29, 2009

Vivek Sharma's comments in todays Eco Times - refreshing!

It was a pleasure to read Vivek Sharma's (CMO, Philips India) article in the Economic Times today. I am so glad that the marketers are like Vivek are seeing business reasons in focussing on BTL - which has been long neglected.

While BTL initiatives has been over shadowed by the more glamorous 30 sec focussed cousins in the ATL space, it is indeed a sign of the times when brand owners like Vivek say that “Brands should not place their eggs in one basket by merely increasing ad spends.” The times have moved from just creating awareness to inducing sales –
something that BTL does not shy away from.

Please read Vivek’s views here.

Do read the counter view by Anamika Mehta to get a media agency perspective.