Monday, January 11, 2016

Timekeeper stops ticking

As HMT shuts shop, take a look at the lesson you can take away from it

Buildings age and become dilapidated. Machines wear out. People die. But what live on 
are the brands".

When I first came into branding, I thought that the above statement was gospel truth. It certainly had an element of truth in it as brands like Pepsi, Coke and Marlboro have lived and flourished for over hundred years. In fact these brands are still going strong. Yet, in the same breath one must accept and acknowledge the fact that once dominant brands like Kodak and Sony Walkman have walked into the sunset. The fact that brands need not live on forever was reinforced once again today as I read the announcement of the closure of HMT, at one time, the market leader by far in India, who proudly called themselves as “The Timekeepers of the Nation”.

India wears HMT with pride
When I passed my matriculation examination way back in 1968, I was gifted a HMT Sona watch by my grandmother. I wore it to college with infinite pride. But I was not alone. India swore by HMT mechanical watches. In fact it was the only brand that you could get in the country though a few who travelled abroad smuggled in the odd Seiko watch to the absolute envy of ordinary mortals like me. India in those dark days was a completely closed economy filled with suspicious customs officials who thought that every Indian was a smuggler. HMT ruled the roost and in all fairness came out with a range of watches that were functional, accurate and more than adequate for the choice starved consumer of pre liberalised India. HMT had a good advertising budget, a fine marketing team and factories in different places. It was what one would call a model Public Sector undertaking. HMT also commissioned a Quartz plant as that was the future.

Enter Titan
Yet storm clouds were brewing as Titan commenced operations in 1985 and launched its brand with great fanfare in 1987. Here’s the breakthrough commercial that captured the imagination of the Indian markets as Titan came in with a range of 250 Quartz watches. 

There was a media blitz on national TV, newspapers and magazines and the Indian consumer went berserk. I saw him come to the Titan dealership with a clipping of the ad, pointing excitedly to an elegant watch that he coveted. HMT in comparison seemed dated and looked like a sixty year old trying to hold its own with a ravishing 21 year old in a beauty contest. The results were swift and disastrous for HMT as it started losing market share as Titan came up with even better and more expensive Quartz watches, more eye catching advertising including the concept of gifting that it pioneered in watches. 

The decline and current demise of HMT watches is something that is a source of regret to many happy customers like me. In fact even recently there was a rush to buy some rare models of HMT watches whose production was going to stop. So what can we learn from the HMT debacle?

Failure the great teacher
In marketing and management people tend to talk only about their successes. While that is understandable, in my view at least learning happens from understanding failures, particularly of others. HMT like most market leaders underestimated the power of the competition. I am reminded of Andrew Grove’s bestselling book “Only the Paranoid Survive”. Successful marketers are paranoid of their competition.

It also read the consumer and her aspirations wrong. The consumer wanted choice, elegance, style, you name it and that was exactly the gap in its product portfolio that Titan filled in more than adequately. HMT too failed to capitalise on its years of near monopoly where it could have built an almost impregnable position. HMT too was adding to its capacity in mechanical watches even as the market was moving towards Quartz. I used to head an advertising agency that did the work for HMT and was proud of our efforts for HMT Roman where we suggested that the market was ripe for a rugged, macho man’s watch to counter the almost effeminate yet elegant image of Titan. The advertising was great, the product brilliant but when the consumer went to the store looking for the brand he couldn’t find it as marketing and production didn’t see eye to eye. For a brand to be successful, all the four Ps of marketing must work in cohesion, but sadly they did not.

HMT not alone
HMT is not alone in failure. BPL, another market leader that I had the privilege of working with for several years lost its way due to a variety of reasons. Ensure that your brand is not added to the growing list of failures in the marketplace. Not for nothing do they say that wise people learn from the experience and failures of others.
Here’s hoping that your brand keeps ticking!

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