FEB 15, 2004
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Q&A Ratan Tata
The complete interview with the Tata group chief. What's on his mind, and what he makes of the under-Rs 1-lakh-car idea.


Moody's Upgrade
This debt rating agency has an image of being unpredictable. Yet, its recent upgrade of Indian debt is no surprise, really.

More Net Specials
Business Today,  February 1, 2004
 
 
BT SPECIAL
India's Best Marketers
Our panel of experts picks India's best marketers of the past year, a baker's dozen of them. Thirteen, it appears, is lucky for some.

Marketing is among the most misused words in the business domain. Ergo, what is perceived as great marketing may, in reality, not be that. Once we got around that problem (See How We Did It on page 70), we found ourselves with a disparate list. Who would have expected a mid-sized fast moving consumer goods upstart from Chennai, a Finnish multinational, and a Bollywood wunderkind to rub shoulders in the first ever Best Marketers list? Of course, the list would have been truly complete had we accepted a suggestion made by one of our panelists, marketing consultant Rama Bijapurkar. "I think you forget Art of Living," she wrote. "It is an amazing brand, has been built by franchising it out, attracts a wide cross-section of society, and has created a category." Logistics played spoil-sport, but let's assure you: you haven't seen the last of AoL in these pages.

SET Executive VP Sunil Lulla in a blue setting: But he ain't got no blues

SET: Just Jassi
The J-Factor

Indian television viewers don't like ugly heroines, went popular wisdom. And most television companies were content to stick to the formula, until Sony Entertainment Television, partly out of desperation at losing viewership in the prime time slot to Star Plus' weepies, partly out of inspiration, decided to go ahead and produce an Indian edition of a Colombian soap Yo Soy Betty La Fea (Loosely, Here comes Betty, the ugly one). The soap, Jassi Jaisi Koi Nahin, has increased SET's viewership share in the 9.30-10.00 p.m slot to 30 per cent. "A sharply focussed, differentiated programming strategy is paying rich dividends for Sony," says Kunal Dasgupta, CEO, SET. Adds SET's Executive Vice President Sunil Lulla, "Jassi is our pincer attack into the heart of middle-class India." In TRP-terms, Jassi trails Star's K-soaps, points out Shripad Kulkarni, CEO (West & South), Carat India (average TRPs for Jassi hover around five while those for some Star serials go up to 14); however, SET has managed to create a new paradigm in soaps and if its product-merchandising strategy for Jassi works-there's no reason it shouldn't given the lady's popularity; some 145,000 people have downloaded the Jassi theme as a ringtone -it could open up an entirely new revenue stream for television companies.

TVS Motor's VP (Sales & Marketing) R. Chandramouli on a Victor: Easy to Riding

TVS VICTOR: Two-wheeled Wonder
To The Victor...

Few products have captured popular imagination as successfully in recent times as TVS Victor. For starters, there is something appealingly-nationalistic about a company that rebounds from a break-up with its erstwhile joint venture partner (Suzuki) with a blockbuster, an indigenously developed one to boot. Then, there's the product itself, TVS Victor, positioned in what is known as the executive segment of the market which is dominated by Hero Honda's Splendor. "Not too many people believed that a new product would work," admits R. Chandramouli, Vice President (Sales & Marketing), TVS Motor Company. But the company persevered and launched Victor in late 2001. The rest, to resort to a cliché', is history. TVS Motor hopes to close 2003-04 with Rs 3,000 crore in revenues, with Victor contributing around a half that. By then, Victor would have also become India's third bike, after Splendor and Bajaj's Boxer, to sell a million units. "The success of Victor has turned around TVS Motor," says Sachin Kasera an analyst at Mumbai brokerage Pioneer Intermediaries. A senior exec at Bajaj Auto claims Bajaj and Yamaha are making inroads into the executive segment. Still, the recent launch of TVS Centra and the imminent launch of a 125-cc variant of Victor lend substance to Chandramouli's claim that "the transition from TVS Suzuki to TVS Motor was effectively done by Victor".

CAFE COFFEE DAY: 142 Reasons Why
The ABC Of Coffee Bars

Cafe Coffee Day CEO Naresh Malhotra at a Mumbai outlet: Within arm's reach of desire

The year that was, 2003, wasn't kind to coffee bars in India. The Barista Coffee Company, which runs an eponymous chain of 130 outlets went through hell: its CEO quit, the company's torrid growth came back to haunt it in the form of unprofitable outlets, and service quality dipped. Which is what makes Café Coffee Day, a chain run by Bangalore-based Amalgamated Bean Coffee Trading Company (ABCTC) different. In 2003, the company added 40 stores to take its strength to 142 across 35 cities. By June this year, the number is expected to touch 300 stores across 60 cities. And the chain will close 2003-04 with some Rs 100 crore in revenues. So, what makes Café Coffee Day click? "We are cost-conscious," says Naresh Malhotra, a former partner at KPMG who now serves as CEO of the chain. "And we pass on the benefit to the customer." A value-for-money bill of fare, he claims, has helped Café Coffee Day create a customer base composed predominantly of people in the 20-24 years age group. And each store, he adds, is a profit-centre. "If it doesn't make money in six months, we close it down." Malhotra has pulled the plug on 14 stores till now. This year won't be easy for Café Coffee Day. Barista has a me-too model. "Our current strategy is about democratising the coffee drinking habit and we have slashed our prices," says Brotin Banerjee, Head (Marketing & Strategy), Barista, and Qwiky's has an alliance with Reliance Infocomm to roll out Java Green coffee bars across Reliance Web World stores.

Nokia India Managing Director Sanjeev Sharma with a new model: GR8

NOKIA: Share-of-pocket Sultan
Ringing It In

In 2003, India's mobile telephony companies added 17.5 million subscribers. Estimates suggest that one company, Nokia, sold phones to more than half the new mobile subscribers in India. Even assuming that 10 per cent of the 11.1 million mobile telephony subscribers India boasted in January 2003 changed their handsets, with half opting for Nokia, the company must have sold 6.5 million handsets in India over the 12-month period. All told, Nokia launched 13 GSM handsets and three CDMA ones in 2003 and the one person the managing director of the company's Indian operations Sanjeev Sharma would like to thank is the Finance Minister. "The fm played an important role when he slashed duties; companies like us compete not just against the competition but the grey market." It wasn't that Sharma and Co. sat back and watched the boom happen: when it emerged that only two telcos had the standards that support picture sharing-a key motivator for buying camera phones-Nokia India went out and tied up with Kodak India. Customers could now visit Kodak Express outlets and print their images out, an idea that was so successful that the parent has now taken it to China, the US, and other countries. Then, there was the '5555' service launched by the company last year that allows Nokia phone users to download ringtones, picture messages, and more. "Your phone should say something about you, shouldn't it?" says Sharma. He uses a 9210i Communicator. Go figure.

PERFETTI: India's Hottest Candy Maker
One-line Wonder

Perfetti's MD Stefano Pelle with his thinking cap : Hair-and-now success

It seems an irony of sorts that an Italian multinational becomes the hottest candy-maker in India on the strength (largely) of Hindi neologisms if terms such as Hila Ke Rakh De, Dobara Mat Poochna, and Dobara Mat Chedna can be called that. We'd love to translate these terms, but are loath to do so given that it would mean an immediate loss of cadence and metre. In 2003, the Indian sugar confectionery market grew by 3-5 per cent. The Indian arm of the Italian multinational in question, Perfetti Van Melle, grew by 20 per cent (it boasts a 25 per cent share of the market). Distribution, marketing texts claim, is the key to success in the low-cost low-margin sugar candy business, and Perfetti, with its direct access to 400,000 outlets and indirect access to 900,000 more, is no exception. However, it is product innovation and communication that lie at the core of the company's success. Not convinced? The company's product portfolio lists over 100 stock keeping units and Managing Director Stefano Pelle is considering the launch of an additional 16 this year. In late 2002, a little after the popular Hila Ke Rakh De campaign for Center Shock hit the airwaves, Perfetti found itself in the midst of an enviable mess: it couldn't meet demand and witnessed several incidents of its salesmen being manhandled by irate stockists. The company is unlikely to face a similar situation again: it upgraded its distribution network later the same year and today, Perfetti contacts and supplies to its trade twice a week. And Perfetti's communication strategy has been so successful that the Indian ops are responsible for churning out ads for several other markets. To translate and paraphrase the punchline for Center Shock, Perfetti has clearly shaken up its parent.

Volvo India MD Ulf Nordqvist with two dinky buses: Bus-iness is good!

VOLVO: Magic Bus
Ticket To Ride

What does Volvo's standing as a marketer have to do with Cherian Thomas who works in Bangalore and visits his parents in Kochi once a month? Everything. Reason: The 30-odd Volvo buses plying what is now called Volvo route. "Earlier, I used to pay Rs 450-500 for a 12-hour non air-conditioned journey; now, I do Rs 550 for a trip in the air-conditioned Volvo which reaches a good hour earlier," says Thomas. If people in other parts of India haven't seen the Volvo, attribute it to the fact that the company has thus far sold buses only in southern and western India. At Rs 52 lakh, a B7R Volvo bus is twice as expensive as other buses. Volvo has addressed the issue of acceptability by making the bus longer, so that it can fit in more seats. And it stresses on comfort. "Initially, we were hesitant to opt for Volvo," admits Suresh Kumar Sharma of Sharma Transports, one of Karnataka's biggest travel companies. "But customer demand forced us to." That's music to the ears of Ulf Nordqvist, Managing Director, Volvo India. "People believe India is a cost-based market," he smiles. "Our success indicates that it is a value-based market." Today, the term Volvo bus, is part of local vocabulary in some southern and western markets.

Karan Johan strikes a pensive pose: He knows

KHNH: With It
Mass Appeal Maestro

At 25, most people would be happy if they knew what they wanted to do with their lives. Bollywood wunderkind Karan Johar has done one better: he has figured out the secret recipe that appeals to a billion Indians. His first two films grossed over Rs 50 crore each and his third, Kal Ho Naa Ho (KHNH for short) looks set to repeat the feat. "My sensibility adheres to popular cinema," says Johar. "From a very young age I have been watching and learning from films; the fact that I am well-travelled and well-read helps." Take that learning bit seriously: Johar analyses motion-pics that fail and studiously avoids the negatives when he is making his own. ''He's very today with a great feel for the ''pulse'' of the market-what sells and what doesn't,'' says Komal Nahata, Editor, Trade Information. ''In fact so keyed up is he on marketing concepts like positioning that other directors often seek his advice.'' That's marketing at its purest.

Infocomm's Head of Marketing Kaushik Roy at DAKC: R-iproaring!

RELIANCE INFOCOMM: Category Killer
M Is For Mobile

In its earlier avatar, Reliance Infocomm had to be satisfied with being L for limited mobile. Even then, a premature launch-sentimentally timed to coincide with Dhirubhai Ambani's 70th birth anniversary-almost proved the company's undoing. Today, just over a year after the official launch (the commercial launch happened around March 2003), the company boasts over six million subscribers, a marketshare of 25 per cent-plus, a reach of 1,100 towns and cities, and is India's largest mobile telephony service provider. What's more, at a press conference to announce the July-September '03 results of Reliance Industries, the company's Vice Chairman Anil Ambani hinted that the telecom venture had broken even. To see Infocomm's numbers in the right context, since March 2003, India's seven cellular companies together added 23 million subscribers. The P-factor, pricing, provided the company with the initial impetus. Even today, explains Kaushik Roy, the head of marketing at Reliance Infocomm, the company's marketing strategy is simplicity itself: "We are the only mobile brand in the country with no asterisk in our ads; our ads say all there is to be said; we are doing it all, reasonable cost, installment options, better technology, wider network." Next step: value-added services and a rapid rollout of Web Worlds with coffee bars branded Java Green. And never mind the unkind critics who claim the R in R-world stands for regulations.

CAVINKARE: FMCG David
Single-serve Success

CavinKare's C.K. Ranganathan with some products: Call me David!

He fought fast moving consumer goods behemoth HLL in the market and in the courts, has grown his company at an average of 16 per cent over the past four years, a period when most FMCG companies would have been content to stay where they were, and successfully parlayed a packaging innovation he was responsible for creating-the sachet, something that management guru C.K. Prahalad evocatively terms single serve-into a 26 per cent marketshare in shampoos. Surely, that must fetch C.K. Ranganathan (no relation to Prahalad) and the company he heads, CavinKare, a mention (maybe more) in this listing. The company, which expects to close 2003-04 with revenues around Rs 300 crore, recently ventured into the business of beauty salons, a natural extension of its existing business (and something that Ranganathan hopes will help grow it even further and faster), and foods (pickles, for starters). "In foods, the market is at the same point where the personal care one was 50 years ago," says Ranganathan, his eyes lighting up to the opportunity.

MTR Chairman Sadananda Maiya with a r-t-e masala dosa: Tasty bite!

MTR FOODS: Curry-in-container Pioneer
Foil-wrapped Success

Sometimes numbers tell the story and sometimes, they don't. First, a sampling of statistics of the first variety: Bangalore-based MTR Foods hopes to close 2003-04 with revenues of Rs 130 crore, up from Rs 103 crore in 2002-03; the company has a 60 per cent share of the small-but-growing Rs 25 crore market for ready-to-eat (or r-t-e) foods; and revenues are expected to nudge Rs 500 crore by 2008. Now, a sampling of the second variety: in the past nine months the proportion of MTR Food's revenues arising from the northern part of the country has increased from 8 per cent to 18 per cent, its production from 15,000 r-t-e packs a day to 50,000, and its number of stock-keeping units (SKUs) from 20 to 30. "We have seen significant progress in a regional brand becoming a national, if not global brand," says Anil Ahuja, CEO J.P. Morgan Partners, a company that invested Rs 19.2 crore ($4 million) for a 28 per cent stake in MTR Foods back in January 2002. The key challenge, says Sadananda Maiya, Chairman, MTR Foods, is "expanding the market; we have to alleviate the guilt of today's woman when she serves our heat and eat food; our palak paneer and masala dosa are just as good, and as tasty, as home-made food." The growing range-in the past two months MTR Foods has launched a range of rice dishes, its popular masala dosa and Upma-backed by what the company's CEO J. Suresh (he was poached from HLL in July 2002) calls "our ever expanding reach" has helped MTR do that and fend off competition from the likes of ITC, Satnam Overseas, Capital Foods, and a clutch of others. And to think it all started with an old-world Udupi-style eatery in downtown Bangalore.

Oriental's MD M. Mahadevan in one of his kitchens: Smorgasbord surfer

In Chennai, restaurateur M. Mahadevan is a legend of sorts: Oriental Cuisines, a company of which he is Managing Director, manages five restaurants and a hotel in Chennai; other companies in his fold manage 22 more restaurants in the city and some 40 overseas across 23 cities including Paris, San Jose, New Jersey, and Dubai; and history records the man as the founder of the popular nation-wide Hot Breads chain, not bad going for a catering management professor. It isn't Mahadevan's international business-he spends six months of the year abroad managing restaurants-that earns him a place in this listing, although, this writer must confess that there is a certain cadence to a man who very recently opened a mainline French boulangerie, replete with French bakers, in Washington. What does is his ability to spot trends as they are breaking, an invaluable asset in the restaurants business. Tapas, as a concept, had existed some time, essentially snacks given out at Spanish bars. In 2003, the term went global, was adopted by restaurants in tony urban boroughs serving food that is oh-so-five-minutes-ahead and catering predominantly to the hip young. Thanks to Mahadevan, who came across the concept in Paris, Chennai has India's first Tapas bar, Zara Tapas Bar (launched in March 2003). Does that translate into money? Well in the nine months leading up to December, Mahadevan's group earned revenues of Rs 100 crore. That's no chump change.

Hutch CEO Asim Ghosh puts his feet up: His advertising rocks

HUTCH: Celeb-communicator
That Message Thing

Hutch didn't grow its mobile business at the scorching pace Reliance Infocomm did in 2003. For those interested in numbers, the company's subscriber-base grew by 105 per cent in 2003, as compared to Reliance's incalculable 0-6 million, and Bharti's 100 per cent. What we're interested in, however, is how Hutch managed to register that growth-arguably on the strength of two of the most creative advertising campaigns the country has seen in recent times. "We see the ad campaigns as part of a larger communication mix and as a continuum devoid of any hyperbole and clichés," says Asim Ghosh, Managing Director, Hutchison Essar. Have the cool-and-retro animated campaign and the high-emotion pug-and-pal one worked? Well, Hutch claims its brand recall score across the circles in which it operates, expressed as a proportion of that of the nearest competitor has moved from around 80 per cent to about 120 per cent. And the company, which was adding just under 100,000 subscribers at the beginning of 2003, added over 300,000 in December. In a category where A.R. Rahman's tune is creating its own magic for Airtel (Bharti), and Reliance Infocomm's blitzkrieg threatens to drown all other messages out, Hutch has managed to cut the clutter. That's something.

TOYOTA QUALIS: Marque-Marvel
The Machine That Made A Company

TKM's Deputy Managing Director K. K. Swamy with a Qualis: MUV-ver & Shaker

Toyota Qualis, the multi-utility vehicle with which Toyota Kirloskar Motor (TKM) decided to enter the Indian market, won't win any prizes for looks but it has certainly managed to win over the Indian consumer. Four years after its launch, over 100,000 Qualises have been sold in India and the MUV is holding its own against brash new vehicles of its ilk. In 2003, for instance, Qualis outsold M&M's (Mahindra & Mahindra's) Scorpio by approximately 25 per cent; for the record, the company's share in the MUV segment in 2003 was a whopping 32.5 per cent. So, just how did a car with dated looks, perhaps non cutting-edge technology, and a hefty sticker manage to cement the reputation of the Japanese carmaker in India? One reason for this could be the reputation Toyota has always enjoyed in India. However, it was TKM's customer-centric approach that won the game: most MUV-makers aren't too particular about customer-needs. "We always ask the customer what he wants; we have to understand the customer, otherwise, the vehicle will not sell," says K.K. Swamy, Deputy Managing Director, TKM. Toyota's famous build-quality-evident in the constitution of Qualis-helped. As did, as the CEO of a rival carmaker points out, "the fact that no foreign companies were operating in the segment they chose to enter." The CEO, however, is quick to add that "Toyota did a dashed good job of convincing customers that the Toyota setting up shop here was the same Toyota from Japan." That's evident in the six-week waiting period for one of the company's new offerings, the relatively pricey Corolla.

HOW WE DID IT
To help us identify India's best marketers, our correspondents contacted eight academics, consultants, and marketing professionals and interviewed them on companies that had, in recent times, managed to: create a market; create a category; grow a market or category; launch a wildly-successful product or advertising or promotional campaign; alter consumer habits or perceptions; grow faster than the market and the competition and gain marketshare; or use a distribution innovation to address a marketing issue. The eight experts who responded were:

S. Ramachander, Director, IFMR-ACME, Chennai
Y.L.R. Moorthi, Professor (Marketing), IIM-Bangalore
Atanu Sinha, Associate Professor (Marketing), ISB
Rama Bijapurkar, Marketing Consultant
Prasoon Joshi, National Creative Director, McCann Erickson
Harsh S. Verma, Lecturer (Marketing), FMS-Delhi
Sukanya Kripalu, CEO, Quadra Advisory
R. Sridhar, Partner, IDEAS-RS

Their responses were collated and 13 best marketers identified. Our correspondents then fanned out to meet these marketers.

 

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