Monday, June 29, 2015

It’s the consumer, stupid!

When it comes to marketing, it’s not about you and your attitudes; it’s only the consumer that matters
There is a new film that is rocking the social media charts. It is a fairly long and yet exquisitely shot film titled “The Visit.” It is quite possible that you might have missed it because you were busy studying. I am told miracles like this actually happen at management school! So here it is for the benefit of the studious types.
As you can make out it is for a brand of fashion fabrics called Anouk which is being sold exclusively on Myntra, or so one presumes. There is a twist to the traditional tale as it is features two lesbian women who are in a live-in relationship. They are basically preparing for a visit by one of the girls’ parents. The brand is bold as per their offering and hence makes a statement that is in sync with the brand’s offering. What is a bold life style statement today? Being a single parent is passé as is perhaps smoking grass or giving up a job to backpack around the Himalayas. Yes, bold is beautiful is what the brand claims and that means announcing to the world i.e. your parents that you are a lesbian.
But first about the commercial
The commercial is a story interestingly told. There are two girls, one tall, beautiful in the classical sense and elegantly dressed while another one is shorter with short hair, cut to please her girlfriend. The film captures all the things women do while dressing up, choosing earrings, searching for kajal, seeking each other’s opinions on colours and styles. To add to the drama, one of the girls is obviously Tamilian as she keeps giving directions to her father, who is visiting, in Tamil. She also says half jokingly that her mother would not like the coffee which her friend would prepare as they are “pukka South Indians” thereby implying that they would prefer filter coffee. The climax is when she teases her friend saying that her mom does not like short hair which her friend is sporting. But when the girl demurs saying that it was her idea she says she likes it this way. And the film ends with her reassuring her friend that she is sure about them and she no longer wants to hide anything. They are ready to announce themselves to the world and the film ends with them embracing and cuddling each other and telling the world what we all know and the sign off is “bold is beautiful” a reference to the styling doubtless of the fabric. It is not so much a film about a brand of apparel as it is about a lifestyle. It could apply equally to lipstick, kajal or even lingerie. And it is for four minutes, nearly. Imagine what that might cost on Sony TV! But clearly this is for social media and relies on likes and shares for it to get the traction the brand is seeking.
Now about you
So what do you feel about the commercial? Does it offend your sensitivities? Do lifestyles like this annoy you? I was a Mylapore boy and even talking to your best friend’s sister in the street in broad daylight was frowned upon in those days. Of course that was three decades ago whereas today it seems you can flaunt your gay status. But it is important that whatever my background, it should not prevent me from working on brands that are not meant for me and it is even more critical that I don’t carry my biases to the work place. Remember marketing is all about putting yourself in the consumer’s shoes, also called empathy. If the consumer for Myntra likes the visit then the Brand Manager had better set his biases aside and think only about the brand and the consumer.
So what must you do?
Many of us sadly carry our own biases to the work place: My language is the best. Everyone watches Star Sports, the best writers are convent educated, ‘Friends’ is the only TV serial worth watching. The problem with biases like these is that while you can be a pain in your personal life and get away with biases and pet theories, marketing is far more complex. The most important thing is to think, feel, watch like your consumer. Only then will you be able to reach out to her. The greatest challenge we must work on is our attitude. We must be non-judgemental and accept our consumer the way she is. Don’t erect barriers to yourself in understanding her and if you are the Brand Manager of Myntra and even if you don’t like the visit, go with it. The only consideration has to be -- “does my consumer like it?”
That is the key to success in marketing, and if I may add, in life.

Wednesday, June 24, 2015

Discover India at your B-school

It’s important to open yourself to new people and experiences, this would hold you in good stead in the future if you want a career in marketing

I was born in Madras, as the city with balmy the weather was known back then. My parents were from Mylapore, I went to school in Egmore and my class was full of Shankars, Srinivasans and Sampaths even if you threw in a Vijay Amritharaj who spoke in Tamil occasionally. We were bang in the middle of an “anti-Hindi agitation” and spoke to each other in Tamil or English and knew more about American history than our own cultural heritage or diversity. Thanks to the way our syllabus was designed, this limited view of India and Indians got a jolt when I went to Ahmedabad for a job as a bank officer. Imagine my plight when I had to pass cheques written in Gujarati, including numbers!
Cut to the present
Why this lengthy preamble? Today, as students in a management school you are surrounded by diversity, unlike my own childhood. You have students from Ambasamudram, on the one hand, and Arunachal Pradesh, on the other. It is almost akin to the Tower of Babel; people speak a bevy of Indian languages, and rarely, if ever, in English, at least to each other. What it does mean is that instead of insulating yourself with similar kind of people, or those who speak only in your own language, open yourself up: meet new people and explorenew cultures and understanding different customs.
And why do I say this? For, it will stand you in good stead when you move onto your jobs or a career in marketing that some of you will hopefully get into. Who knows you may have your own version of ‘two states' going forward. Don’t get me wrong, this is not what I am advocating as the primary objective of your MBA.
Every state has its own nuance
When I was young, Madras was obsessed with Horlicks. The brand had around 80 per cent market share in that health conscious state. Only if you grew up there did you realise how important the brand was to an average Tamilian’s life. Children drank it religiously in the morning. Guests were fondly offered it whatever time of day they visited. Sick people were offered copious amounts of it to help them convalesce. Any South Indian kitchen had a display comprising Horlicks bottles that stocked sugar, salt and what have you.
In fact, life was often described as one big Horlicks bottle, so much did our lives revolve around it. While this was common knowledge amongst Tamilians, this wasn’t known to people from other parts of India. Try to find out about different regions and their unique features. Then you will be a true Indian and not only a Tamilian or a Bengali.
What of the future?
Today, people seem to have a very limited idea about the rest of India. Whilst this per se is not such a big problem it certainly manifests itself in very poor understanding of India’s diversity and the difference in languages and customs that result in poor marketing strategy and even worse execution. I sincerely hope that you, in the future, will be smarter and better informed about India when you do market goods and services.
For example, you will never release an ad in Hindi in Chennai as it is currently being done. So what must you do? The key is observation. Very often, we listen without hearing. We see without observing. The moment you start seeing your classmates as future consumers then your entire perspective will change. Try to make friends with people from different states consciously. Try to know what language they speak and not merely learn the cuss words in that language. Try to understand one unique feature about each race or one nuance. Let me give you an example. Bengalis seem to prefer Arrow Root biscuits. Maharastrians seem to dip the biscuit into their cups of tea while Tamilians prefer to drink their filter coffee from steel tumblers and a unique vessel called the dabarah.
Tip of the iceberg
The few examples I have shared with you are merely to fuel your curiosity. The starting point is a change in attitude towards education. Don’t treat your MBA as a mere 3+2 or a 5+2 after engineering. It can be the beginning of a whole new world. But you need to open your eyes. To your future and to those around you. Believe me, your life will transform and you will carry your transformation to the place of work.
Welcome to the future!

Wednesday, June 17, 2015

After the ban, what can help Maggi regain its brand value

Regaining customer confidence isn’t easy once consumers have a negative perception of a brand. Crisis management requires more than a hurriedly called press conference.

In today’s world of citizen journalism, news goes viral in a flash. And if it is bad news, it acquires a spin and speed that is virtually impossible to stop. Brands, therefore, are more susceptible to a tarnished image today, than in any other day and age. The cocktail of the online and offline world, consumer and shareholder activism, random decisions by government bodies, volatile social groups, and hatchet jobs by competing firms make it all too easy to fall from grace. And the loss of goodwill can play out in the form of decreased revenue, loss of clients or suppliers and loss of market share.
The latest brand to find itself in this quagmire is Maggi, the instant noodles brand from food and beverage company Nestle. One of India’s most trusted brands and perhaps the country’s most favoured comfort food, it has taken a huge knock in terms of brand value and sales ever since the recent controversy broke over allegations that it had lead and monosodium glutamate (MSG) in excess of permissible limits and was, therefore, unsafe to consume. The controversy arose after the Uttar Pradesh Food Safety and Drug Administration ordered the recall of a batch of 200,000 Maggi noodle packs. With more and more states deciding to randomly test samples and banning sales in the interim, coupled with retail chains removing it from their shelves, the company has had no other choice but to retract the product.
Maggi was ranked number 18 in the BrandZ Top 50 Most Valuable Indian Brands study, conducted by Millward Brown and commissioned by WPP last year, with a valuation of $1,127 million. It is expected to have eroded in brand value by at least 30-40%, say brand specialists. Sales have dropped by at least 60-70%, say retail analysts.
Ramanujam Sridhar, founder at consultancy Brandcomm says that he is astounded by the rapid snowballing of the situation. “A recall of some batches of noodles from Uttar Pradesh has assumed nationwide form, leading to complete brand erosion for Maggi, in a matter of days. Nestle India took over 30 years to build this brand in the country,” says Sridhar.
Brands in trouble
Maggi isn’t the first brand to find itself in the dock. Many a brand in India and elsewhere have seen their reputations sullied after one single incident, sometimes for no fault of theirs. Fast food chain McDonald’s has been battling its “unhealthy” image and has seen its share of obesity lawsuits in the US, on account of its unhealthy food. It has seen a 2.3% decrease in global sales in the first quarter of 2015. Sales fell dramatically in Asia (8.3% decrease) after reports of expired meat in China and other quality related problems in Japan. Closer home, a Kalyan Jewellers ad earlier this year invited the fury of activists, who labelled it “racist” and “promoting child labour”. The ad projected Bollywood actor Aishwarya RaiBachchan as royalty, with a dark skinned child holding a red parasol over her head. The jewellery brand had to then clarify that the advertisement was intended to portray “royalty, timeless beauty and elegance”. It expressed regret for any inadvertent hurt caused. This situation is not unlike the Ford Figo ads controversy which displayed images of bondage and brutality, forcing Ford’s global management to issue an apology.
While cola brands Pepsi and Coca-Cola were being investigated for pesticides in their drinks, chocolate brand Cadbury had to face flak because of a worm infestation controversy.
Ambi Parameswaran, chief executive and executive director, FCB Ulka said that all national and global brands have well-laid down guidelines to adhere to. But sometimes they do get caught in a sudden change of laws, consumer activism, or even plain mischief. “The most famous brand crisis and best response is the J&J Tylenol tampering case in the US. No B School education is complete without discussing the Tylenol case and the way the company responded and recovered in six months to an even better place. In India, too, brands have faced such challenges in the past and have managed to recover, be it the brominated vegetable oil (BVO) issue, the pesticide issue or the worm infestation issue. The lessons from Tylenol are clear: do not point fingers, act quickly, put in new safeguards and be frank and open in your response. We should remember the fact that the Tylenol crisis happened before the advent of social media and its own brand of citizen journalism. But still, the lessons are the same.” In 1982, seven people in Chicago died after ingesting Tylenol capsules which had been laced with cyanide by a mentally challenged person. Johnson & Johnson recalled all of its products. The quick response by the company saved the day, and restored  trust. Tylenol was re-launched with a revolutionary tamper proof packaging seal.
Parmeswaran adds that while all the debate on packaged foods and quality standards rolls on, let’s not forget all the food items that are consumed on a daily basis, on the dusty roads of India. “Probably the packaged branded goods are still the safest,” he remarks.
In the wake of the Maggi controversy, all packaged food brands may just come under the radar now. Shailendra Singh, joint managing director of advertising conglomerate Percept, says that the Maggi case could invite attention for 200-plus brands in the packed foods category. “If the Food and Drug Administration (FDA) is serious about cleaning up the foods business, this is an opportunity for it to go after several other brands. Why single out Maggi, or rather, Nestle India alone? That said, this generation thrives on snack foods. Despite many damaging videos on Youtube on the ill effects of colas, they still sell,” he says. There could be more brands in trouble as the Food Safety and Standards Authority of India (FSSAI) plans to test protein powders and energy drinks from across the country for their quality and ingredients. The regulator has already written to many other companies raising concerns and queries on labelling and branding of some of their popular packaged food products.
Mayank Shah, group product manager at the country’s biggest biscuit maker Parle Products, said that the packaged foods business is seeing healthy growth, and the Maggi episode is unlikely to make a dent on sales of other companies. “The ready-to-eat segment is only set to grow and this is a minor blip. The government is very vigilant and is updating standards for packaged foods companies which are a welcome step. Companies must obviously comply with these standards.
There is a need for ongoing conversation with consumers on the safety and quality of products and complete transparency as far as production is concerned,” he asserted.
The ITC Group owns the Sunfeast Yippee brand of instant noodles. An ITC spokesperson said, “It is too early to gauge the impact on the industry as a whole. But ITC’s food products are manufactured in state of the art, world-class facilities. Strict quality and hygiene norms are followed in the manufacture of all products. Stringent checks are undertaken for these products at ITC’s internationally benchmarked Life Sciences & Technology Centre as well as at reputed external laboratories. In all these tests, our food products have consistently been found to be completely safe for consumption and in compliance with all regulations.”
At the same time, both ITC and HUL are voluntarily going in for additional tests on their respective instant noodles brands—Sunfeast Yippee and Knorr respectively—as a means to reassure customers about the quality of their products. HUL is also withdrawing its Chinese instant noodles range from the market. “The discontinuance of manufacturing and sale of Chinese instant noodles is not on account of any safety or quality concerns. The Chinese instant noodle range uses ingredients which are permitted under the FSS Regulation, 2011/Codex and safety of these ingredients is well established. Details of the same have been shared with FSSAI as part of the product approval application. HUL continues to engage with FSSAI to secure the approval of this range so as to make these products available at the earliest for its consumers,” said a HUL statement.
Denial versus acceptance
A statement from Nestle India said that the company will take the product off the shelves, and yet insisted that the quality standards had been met. Speaking at a press conference in New Delhi, Paul Bulcke, global chief executive, Nestle said, “The trust of our consumers and the safety and quality of our products is our foremost priority everywhere in the world. Unfortunately, recent developments and unfounded concerns about the product have led to an environment of confusion for the consumer, to such an extent that we have decided to withdraw the product off the shelves, despite the product being safe. We promise that the trusted Maggi Noodles will be back in the market as soon as the current situation is clarified.”
Regaining customer confidence isn’t easy once consumers have a negative perception of a brand. Crisis management requires more than a hurriedly called press conference. In 2004, Cadbury India, had roped in superstar Amitabh Bachchan announce new packaging for its flagship Cadbury Dairy Milk, following a tenacious worm infestation controversy. Abhijit Avasthi, former national creative director at Ogilvy & Mather who was involved with the campaign, said Cadbury was honest in its approach. “The brand first admitted that there was a problem with some of the packs. It then revamped its entire packaging. They signed up a credible star — Amitabh Bachchan — to communicate that there was a quality issue which it had addressed. It was done with a lot of sincerity and openness, and that greatly helped the brand reclaim its lost ground. One thing that Cadbury enjoyed, which Maggi also shares, is that it was absolutely loved by the people…they wanted to forgive it”. Avasthi said Bachchan had done his share of due diligence before he took up the task of re-assuring the public. “He visited the factory and was assured of the quality standards. Only then, did he agree to be a part of it,” he said.
Nabankur Gupta, founder of Nobby Brand Architects & Strategic Marketing Consultants says that Nestle India needs to get its product right before it goes into damage control. “It’s not enough to say that it’s the same formulation for Maggi globally. Nestle needs to re-formulate Maggi as per Indian standards and regulations, and replace them in stores. The cost could be considerable, but it is not an impossible task. Once you do that, you can build the brand up slowly by investing in corporate social responsibility activities, signing up a credible endorser, effective public relations etc.”
Other brand custodians advocate honestly and reassurance, in the face of sticky situations. HDFC Life senior executive vice president Sanjay Tripathy says in a scenario where there has been a lapse or error on the company’s part, then acknowledgment is the best way out. “During the time of a crisis of such a magnitude, it is imperative for a brand to communicate. Connecting with your stakeholders in order to share a message that helps ease them emotionally is the key to good reputation management. The lapse may or may not be intentional but humility at such a juncture is the least that the consumers expect. Acknowledging the lapse, taking corrective, timely and stringent actions and making a pledge to ensure that no such incidence would ever be repeated is the best way forward.”
Agrees Indranil Das Blah, chief operating officer at Kwan Entertainment and Marketing Solutions, who says, “The only response to an image crisis should be transparency and accountability. If you don’t have something to hide, then don’t. But if you do, come clean with it.”

Winning back the trust of consumers and investors is key to reviving the brand image. The business performance of the company originates from the consumer performance. Nestle certainly recognizes this, as evidenced by the emphasis on rebuilding trust and consumer confidence at Bulcke’s press meet. “With the consumer I mind, we will do everything it takes, are fully engaged with the authorities to clarify the situation,” Bulcke said, adding: “Our priority now is to engage all stakeholders to clear the confusion. Maggi will be back on store shelves soon.” But staging a comeback will be a formidable task.

Friday, June 12, 2015

Does the boss wear a Titan watch today?

Brands are not timeless as we'd like to believe

Do you wear a Titan watch? I would be surprised if you did, simply because many youngsters do not even wear a watch much less a Titan. And why is that? The reason is simple. They see the watch as a time keeping device and not as a fashion accessory as Titan would like to believe it is. And how do they see the time? They see it on the mobile which seems a much more integral part of their life than the watch is currently. But why are we digressing and why did the piece talk about the boss. Watch this commercial of Titan first….

Okay I am sure you understand it even better than I did. But here goes. The commercial is set in a restaurant where two former colleagues are meeting - one younger and the other more mature. The older man objects to the younger man referring to him as “sir” time and again. The young man once again thanks the older man for relieving him from his duties earlier on when he had wanted to resign and his blessing to him that “it’s the best decision he has taken”. Clearly the younger man has gone on to promote a very successful start up. The older man asks him what happened to his plans to get a CEO. The younger man shyly tells him that he does not know to recruit a CEO. The older man reassures him by telling him that just identify the person and tell him that he is the right person for the job. The younger man is skeptical. Is that all he asks and the older man says he is sure. He looks at his Titan watch for strength and then taking his heart into his mouth tells his former boss that he is the man for the CEO’s job and hands him the letter of appointment. The older man initially bemused accepts the offer and the tag line says “your time has come”. In the tradition of Titan commercials it is a really nice commercial, but this is not so much about the communication as it is about the stage in life of the Titan brand.
Back to 1987
I am sure you probably were not born in 1987 when Titan was launched in India. Titan was an instant success when it was launched with over 200 models of Quartz watches and soon ensured that HMT who proudly called themselves “timekeepers to the nation” would go out of business.

Titan changed the way the product was made, looked at and sold. It transformed the watch market. It has several credits to its name. It is one of the most admired marketing companies, a great place to work for and a company which most management graduates like you would give an arm and a leg to work for. In 1987 when Titan was launched, I was young (those were the days) successful and upwardly mobile in my profession. I wore a Titan watch with pride as did the Chairman of the advertising agency I worked for. But will today’s bosses wear a Titan as the commercial so cleverly depicts? I wonder. My submission without the benefit of extensive research is that today’s CEO wears an Omega or even a Rolex but not a Titan. Titan is not the aspirational brand it was three decades ago. I am sure the company is aware of this problem and realizes that the answer is not just clever advertising but a whole host of things.

What is our learning?
Let us not worry unduly about Titan’s ability to handle the problem of the brand’s ageing as they know more marketing than all of us put together but focus on our own learning of brands. The first brands are not timeless as we would like them to believe. While some brands like Pepsi have managed to remain eternally young and for the young at heart others have not been as successful. With over 50 per cent of the Indian population being young, brands need to be aspirational for young people as well. Why do I say Titan is not aspirational? I have talked to enough youngsters who say that it is ok to gift a Titan to their parents but not ok to gift it to one’s spouse or girlfriend. All of these are signs that the brand is ageing. I am sure Titan has the capability to understand this and crack the rejuvenation code. But as students of management let us constantly be aware of what brands are facing and learn from their challenges.
And finally can you think of any other brand which is facing this problem?

Maggi imbroglio: When star power scorches

In the line of fire: Stars who endorsed Maggi noodles are now staring at punitive action

Is it fair to blame celebrities for the Maggi imbroglio?
Pullela Gopichand, former badminton champion, is as celebrated for his prowess as a sportsman as he is for having rejected a lucrative offer to endorse a carbonated soft drink after he won the All England Badminton Championship in 2001. He was concerned about the health hazards they posed. ” I don’t drink any colas so how could I endorse them? Celebrities can endorse something if they are confident of the product, but I don’t think they should do it just for money’s sake,” he says, when cat.a.lyst calls him to discuss the role of celebrities in the Maggi noodles controversy.
There are many facets to the Maggi noodles mess. The steaming hot controversy erupted after the Food and Drug Administration (FDA) in Uttar Pradesh found high levels of contamination in a 2014 batch. It raised several issues, which boil down to ethics. One of these ethical conundrums  relates to celebrity endorsements.  Actors Preity Zinta, Madhuri Dixit and Amitabh Bachchan, who have endorsed the brand, are reported to have been served notices by the government for misleading consumers by starring in advertisements for a product that is now allegedly toxic because of impermissible amounts of MSG and lead.
How fair is it to blame the celebrities for their role? There have been quite a few controversies, both in India and abroad, where celebrities have been blamed and sued for supporting certain brands which failed to deliver on their promises. There is the infamous case of Home Trade, a financial services portal which roped in none less than cricketer Sachin Tendulkar and actors Shah Rukh Khan and Hrithik Roshan to build trust, only to shatter it ultimately. They have also been drafted to restore confidence among consumers when brands failed them, like in the case of Cadbury, which used the Big B in a reassurance campaign.
Walking the talk
Says Ramanujam Sridhar, Founder and CEO of the Bangalore-based brand-comm, a brand consultancy: “The celebrity is not seen as someone who uses the product he is supporting. He’s only seen as an entertainer who comes and goes. But there are several cases cited as successes of celebrity-aided advertising – Santro, which Shah Rukh Khan endorsed, for instance. Who would believe that MS Dhoni really wears a Sonata or that Tendulkar rides a TVS Victor, that too in Mumbai?” He says that in the West, there are fairly stringent stipulations that celebrities cannot advertise a product unless they use it, but that is not the case in India. “That being the case, how can you suddenly hold them responsible?” he says.
Section 24 of the Food Safety and Standards Act 2006 prescribes the general rules that no person can participate in unfair trade practices to promote the sale and consumption of foods or claim they are of a particular standard or efficacy that is not based on scientific justification. In any case where a defence is raised to the effect that such a guarantee was based on adequate or scientific justification, the onus of proof lies on the person who raises defence.
Section 53 says that any person who is a party to the publication of an advertisement which makes false claims and misleads consumers about the food’s nature or quality will be liable to a penalty which may extend to Rs. 10 lakh.
Anisha Motwani, Director and Chief Marketing Officer, Max Life Insurance, thinks it is unfair to drag celebrities into this debate. ”They are experts in their field of work, not in the product/service they endorse. They are picked for their appeal, influence and popularity. Even the people who handle their contracts aren’t experts in products and services being picked. Had that been the case, we would have had scientists and researchers as celebrity managers.”
 The need for accountability
Gopichand says that while he thinks it’s unfair to blame celebrities for Maggi’s alleged negatives, celebrities also need to be conscientious when they endorse products that affect people’s health. “There needs to be a balance. People have faith in celebrities’ judgment and from that perspective, I would think there is a certain amount of responsibility that they need to take. How much that is rests with them.”
 To what extent does a celebrity’s  duty stretch? Says Sridhar: “Even if the celebrity demands to see proof that a brand is safe and is shown it, how would he really know? They wouldn’t sign on the dotted line unless the deal comes through a big, reputed agency.” He also charges celebrities’ managers with relentlessly hawking the celebrity like a consumer product that’s going to go out of fashion. “I hope this issue will make the celebrities more selective and prudent,” he says.
Says Max Life’s Motwani, “You can’t expect a celebrity endorsing a real estate brand to know and approve of the quality of cement used to build houses. Neither can you expect one endorsing a writing instruments brand to know where the ink is sourced from. I think as long as celebrities employ reasonable judgment to decide their picks, it is fine.
For instance, the choice to endorse or not an accessories brand which uses leather for its bags, or a paper brand where environmental impact is obvious, or a taxi operator which has a history of despicable cabbies … these are critical decision-making criteria.
When a popular face falters here, consumers and media have every right to badger him/her in case a negative incident surfaces. But other than that, no.”  She says consumers today aren’t naive. “They understand that the celebrity is adding a popular face to a brand, and not responsible for what goes into its making.” 
 What the aam aadmi says
And what does the person on the street say? Chennai-based AKR Rao believes it’s the consumer’s lookout, solely. “Even if the celebrity gets a quality certificate from the company assuring them that the product is safe, it’s not gospel, nor is its validity permanent.
Quality could suffer later. How can celebrities keep tabs on that?” He says no celebrity will deliberately endorse a harmful product, no matter how greedy. Even if it they do, the principle of caveat emptor(buyer beware) should kick in, he adds.
Yercaud-based Poornima Swaminathan says, “I think they endorse mainly according to the money they get and few really bother about what it does to the millions who follow them. But with Maggi, I feel it’ s really not their fault. Who would associate lead and noodles? However, in products that claim fairness, water-purifying and such, they should really find out.
Maybe Maggi is the beginning. Should they have checked? I don’t know. Maybe in hindsight, yes. We all know that sometimes even we are tempted to buy something seeing the advertisement. How much more then, the guy whose life begins and ends with Madhuri Dixit?”
Swaminathan also thinks the food safety system should be held responsible as it is also their fault those noodles made it past quality control. “Our food safety regulations are not in place. I know companies apply different standards to different countries.  People will have to start pushing the standards that we have.”  
Others that cat.a.lyst spoke to pointed to how there’s a “willing suspension of disbelief” when celebrities endorse products. And, as AKR Rao says, “Are you going to go check a star’s bathroom and see if they really use that soap? And do you really believe that you hair will grow knee-length if you use that oil?”
It’s as if we, the average Indian, do not take our celebrities seriously. We gush over them, the matches they play in, the movies they act in, take sides, endorse their merits, but when it comes to crediting them with credibility, we are less trusting. One would even go so far as to say our attitude is one of indulgent cynicism. Put aside those fevered debates about whether they should be prosecuted and the answer is invariably: “Look, we know they are in it for the money. We’re not fools to believe everything they say.”
But the reality is that many people, especially children and those with little exposure to information, are impressionable, and celebrities influential. What is the right course then, is the question, the answer to which must come from the hearts and minds of all stakeholders involved. And yes, never forget: caveat emptor.

Tuesday, June 9, 2015

Maggi controversy brings other noodle brands under FSSAI scanner

In the wake of the on-going Maggi controversy, The Food Safety and Standards Authority of India (FSSAI) has ordered testing of various noodles, pasta and macaroni brands to crackdown on contaminated food products. According to media reports, the companies whose products have been listed for testing are Nestle India (4 variants of "Maggi Nutilicious Pazzta with tastemakers), ITC (Yippee), Indo Nissin Food Ltd (Top Ramen), GSK Consumer Healthcare (Foodles), CG Foods India, Ruchi International (Koka) and AA Nutrition Ltd.

Commenting on this recent development, Pranesh Misra, Chairman & Managing Director, Brandscapes Worldwide said, “From the consumer’s perspective, if there is either a miscommunication or any harmful ingredient in the product, then other brands coming into the scanner is a good thing. But my question is- how accurate are the test protocols which are followed? Therefore, there should be a standardised testing mechanism, which should be used by everyone. Otherwise, the results might differ from state to state or even between bodies.”

Speaking on the same lines, Ramanujam Sridhar, Founder and CEO, Brand-Comm highlighted that the objective of the test is to benefit the consumers and if the product is safe or not. “My views are that every brand should come under the same scanner, and if there are better and stringent rules formed after the tests, then it needs to be welcomed. For some time I had the feeling that Maggi was being witch-hunted, which thankfully is no longer the case now. So it is actually a good move and everybody should conform to it,” he cited.

Lloyd Mathias, Chief Marketing Officer, HP pointed out that the only positive outcome of the Maggi controversy is that it has made everyone more aware about food safety standards and hopefully Indian consumers will be better protected in the future.

Nitin Mantri, President, PRCAI (Public Relations Consultants Association of India) and CEO, Avian Media, elaborated, “After the entire Maggi controversy, interference from the government was bound to happen. There was a need to find out if the other brands are following the guidelines or not. So government had to act and they can’t just single out on one brand, which was happening all this while.”

Things turned worse for Maggi, as the government dragged Nestle to the National Consumer Disputes Redressal Commission (NCDRC) for "unfair trade practices and misleading advertisements" and may seek financial penalties among other actions. To add to this, Mumbai based NGO; Watchdog Foundation has also filed a criminal case against Nestle India and its nine directors. Over the weekend, there were reports of the Swiss giant spending Rs 445 core on 'advertising and sales promotion' last year, while the expenses towards 'quality testing' was less than 5% of such amounts was revealed and was shared on social media.

The company had earlier received lot of flak for its ‘dismissive; approach and ‘incompetency’ in handling a crisis situation.
Therefore, reportedly, as part of the damage control exercise, Nestle has roped in US- based public relation firm APCO World Wide and has also got back Shivani Hedge who was heading the Sri Lankan operations to India to rescue Maggi from sinking further. A press conference headed by Paul Bulcke, Global Chief Executive, Nestlé on 5th June declared Maggi noodles as safe, but still the company decided to take the product off the shelves nationwide.

Mantri from PRCAI explained that it is a very critical phase for Maggi. “Building trust back is a very difficult game, but it is not an impossible one. From now on, the brand should focus on how to regain the lost trust because from here, the entire controversy will only lead to logical conclusion,” he said. There were other reports, that Nestle has replaced all Maggi ads with Nescafe and KitKat commercials.

Sharing his thoughts on the brand revival of Maggi, Misra from Brandscapes Worldwide added, “Initially for the first couple of years, there will be a challenge. The impact will last for some time and the financial effect will also be stronger. But companies do tend to grow out of it and then regain the consumers’ confidence after such debacle. Maggi already enjoys a lot of good-will in the market, so this kind of positivity will help the brand to bounce back. When giants like Coke, Pepsi, and Cadbury have come out of similar crisis situations successfully, my question is ‘why will it be a problem for Maggi?’”

Talking about the international space, Nestle has recently got itself engulfed in a new controversy, where they have been receiving a lot of social media backlash in New Zealand post a recipe change for one of their popular products Milo. The taste is being criticised and is being compared to detergent, soap etc., and fans have also questioned the company that ‘Why change something that wasn’t broken?’ They have also opened a Facebook page titled ‘Change Milo Back to the old recipe’ which has got around 6,000 likes to plead the makers to do the needful.

In response to the growing tension and to manage further social media debacle, Nestle New Zealand came out with a statement saying that the company has removed vitamin A, B1 and magnesium, and added vitamin D, B3, B6, and B12, to "help active kids, and adults, perform at their best". It has also removed added artificial vanilla flavour as part of a move to make Milo as natural as possible. The company has elaborated that the core ingredients -milk powder, malted barley, cocoa and sugar –however, have not been changed. In the statement, Nestle has explained the reason behind the tweak in the original recipe and that the changes are part of their global commitment to make products more nutritious and better.

Monday, June 8, 2015

Brands such as Maggi under fire

The biggest crisis brands face today is the onslaught on social media and an inability to handle it
Brands are like pieces of fine crystal - they take time to create and are easy to break" - Mike Isaacson

Maggi, the two minute wonder that has been hailed in marketing and business school circles as one of the biggest successes in Indian business history, is suddenly under a cloud. It is alleged to contain MSG and lead beyond permissible levels and its sales have plummeted across the country. See link

Maggi is not the first brand to come into crisis, nor will it be the last. I am sure you all remember the trouble that Pepsi faced in the country and the even bigger problems that Cadburys faced with worms in the chocolate and their elaborate campaign of their new tamper proof packaging featuring Amitabh Bachchan which had the effect of rescuing the tottering brand and restoring credibility.
See commercial.

Let’s step back a little and study this whole business of crises as brands seem to lurch from one crisis to the other with the same ease with which swift footed batsmen take cheeky singles in T20 matches.

Brands take time to build

One of the things that we must remember is that brands are not built overnight. They take time, effort, strategy and resources to build. Pepsi, one of the brands we spoke about earlier, is a brand that is more than a hundred years old. And yet it does not take much to throw it into a crisis and that crisis can affect credibility and impact sales and market share. And yet there is another twist to the tale today. If you analyze some of the biggest brand crises of those days whether it was Tylenol, Pepsi or Cadburys that we spoke about they were much smaller crises than what brands face today. That was simply because these crises were played out on mainline media like print and TV which though they had tremendous impact, were still restricted to the countries they were circulated in. Today however thanks to the social media and the power of facebook and twitter these crises can really snowball. Look at this on Maggi where in the early days of the crisis they had handled it poorly on social media. The results are already beginning to show.

So what must brands do?

One of the first realities of modern business is the realization that some crisis or the other is inevitable as far as brands are concerned. Maybe the scale of the crisis might vary, but it is probably lurking around the corner. This leads me to the next question and arguably the most important one. What should brands do? Do you remember the old scout motto? Yes it is “be prepared” and brands must really prepare for battle. How do you prepare for battle? You try to predict where and how the enemy will attack. Borrowing the same logic, smart companies have contingency plans for every crisis. What could the possible crisis be? A factory could catch fire, people could die in an accident, there could be a sexual harassment case in your office, there could be a safety or health hazard in the products you make, dangerous effluents from your plant might raise the heckles of the community… The list is endless and savvy companies list out these exhaustively and start working on a damage control plan. Crises can be tackled and their intensity can be reduced. Today one of the biggest challenges is on social media. We have seen enough instances of the crisis that an off the cuff comment or statement can make on social media. Here is a whiff of a future crisis that I read in today’s newspaper about an Uber driver kissing a passenger…

Damage control is key

I am not sure Maggi has handled this crisis well though it was brewing for some time now. It is important for companies to respond quickly and yet not hastily. It helps to express regret or sympathy particularly where people are involved. The Public Relations company should work overtime to get the company off the headlines and from the tickers in TV channels. If the headline were to read “Taxi driver caught kissing passenger” is better for Uber than to have its name in this condemning headline. The company must have its version ready or what we call as a holding statement. It must have only one spokesperson talk to the media. It must be always available for comments and questions. When there is an accident or trouble at the factory, it would be advised to hold media briefings away from the venue preferably at a neutral avenue. More than traditional media the challenge as stated earlier is manifold in the social media and today more and more companies have full time experts handling their online reputation. Yes brands are like fine pieces of crystal. Don’t be casual about the way you handle them otherwise years of hard work and investment will just go down the tube in “two minutes”.

Tuesday, June 2, 2015

I love advertising but I am not creative ....

Advertising is not only about being creative but working on brand strategy

Over the last several years of teaching hundreds of management students, I have heard one common statement from students. ”I love advertising, but I am not sure if I will be successful in it because I am not creative.“ Do you think on those lines? Does advertising as a career interest you? What options are there in advertising? What are the career prospects? And who should come into advertising? Let me try to address some of these questions in this column. So hang in there.

Those were the days

Way back in the eighties, I came into advertising from IIM like several others of my time. Do the names Sam Balsara, Madhukar Dev, Santosh Desai, Ambi Parameswaran and Arvind Sharma mean anything to you?
Well they should if you want to get into advertising, because these are the doyens of the advertising industry who hold office in some of the largest advertising agencies and branding companies in India and lead the destiny of thousands. Why did we come into advertising after an MBA? We all came into advertising because the industry fascinated us. We were turned on by the creative ads we saw. All of us came from the major management institutes in the country like Bajaj, XLRI or IIM. Today, I can say with certainty that no one from a top flight management institute will come to advertising and the industry is poorer for it. A person from the lesser known management schools is all the industry can afford today it seems which is certainly hurting the industry.

But why advertising?

MBAs are unlikely to be the creators of advertising but they can certainly manage the advertising for brands and the relationships which come with it. Today after over three decades, I realize why I love this profession. In so many years I have done campaigns for motorcycles, tyres, shampoos, apparel, corporations, whiskey, beer and God knows how many more categories. And that is the greatest challenge of advertising. Every day you learn and unlearn about a new product, their competitors and keep researching different consumers - a house wife one day to someone buying health insurance the next. To sum it up there is never a dull moment in advertising. So do you want different things and never be bored at work, advertising is the business for you.

But advertising does not pay well does it?

You are absolutely right. Advertising despite all its glamour has not kept pace with the others. Today sectors like ecommerce, banking, software, financial services and several others pay more than advertising which means that most MBAs tend to look elsewhere and who is to blame them? While the salary in advertising in those days was certainly not as low as it is now comparatively, I must say in the same breath that the growth prospects are much better. One’s career growth path also can be much quicker. And a thought for the advertising barons of today, you too need to remember that if you pay peanuts as you are currently doing, you will end up only with monkeys. And though it will upset the people in the industry I must tell you that the quality of people overall in advertising is pretty sad. So if you are good, you will end up way ahead of the competition and that is certainly one of the reasons why you should look at advertising as a career.

But I am not creative

Yes let’s take the bull by the horns. What is being creative? It probably means you write poetry, write skits, paint or compose music. I can do none of these things but I owe what little success in life I have achieved to advertising. And why is that? That’s simply because more than being creative, what is required is an understanding of what will work and what won’t. We need an appreciation of creative and the process rather than merely being creative, as remember MBAs don’t write the ads. They are catalysts to the creative process working with the creative people and the clients; they can decide the strategy of brands and the tone of voice of the brands that they handle. And finally I remember what Bob Dylan said “If you get up in the morning and go to sleep at night and in between do what you like consider yourself a successful man .“
And believe me you, I am a successful man because over the last decades I have enjoyed every moment of my working life. So here is my invitation to you. Welcome to the madhouse! You won’t regret it!