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FEB. 11, 2007
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Taxing Times
The phase-out of central sales tax is yet another move towards ushering in the national goods and services tax (GST). The compensation to the states, in lieu of CST phase-out, will include revenue proceeds from 33 services currently being taxed by the Centre as well as 44 new services of an intra-state nature that will be traded by the states. However, VAT is the way forward, though much needs to be done to iron out the anomalies in the current VAT regime.


India, Ahoy!
Indian investments overseas are growing and how. For instance, total Indian investment in Latin America and the Caribbean has topped $3 billion (Rs 13,500 crore) so far. The latest investment is by ONGC Videsh, which acquired an oilfield in Colombia for $425 million (Rs 1,912.5 crore). Earlier, ONGC bought an offshore oilfield in Brazil for $410 million (Rs 1,845 crore).
More Net Specials
Business Today,  January 28, 2007
 
 
FILM MARKETING
As Hero Brand
Move over in-film advertising. Out-of-film, or associative marketing, is the latest mantra in Bollywood. The twin benefit: Mileage for the brand, and for the movie.

The hero of Mani Ratnam's blockbuster Guru is also a bicycle. At least that's what the marketing honchos at Munjal group company Hero Cycles would like to believe, with due apologies to Abhishek Bachchan, who as Guru emerges out of humble beginnings to develop into a business tycoon, a la the late Dhirubhai Ambani. The female protagonist of the film, Aishwarya Rai, as Guru's wife, duly cavorts with Bachchan through the film, except for at least one scene when she's firmly perched on the seat of a Hero cycle, her power on the pedals perhaps proportionate to Guru's burning desire to amass wealth. A smart product placement in movie, you would say. Maybe, but it doesn't end there. Hero Cycles, for its part, had begun running a 30-second ad film with a shot from the film of Ms Rai riding a Hero cycle, with the soundtrack of Guru and the countryside for company.

THE DREAM MERCHANTS GET TOGETHER

FILMS/ ASSOCIATING BRANDS

Dhoom 2
McDonald's
Speed
Pepe
Suzuki Zeus
Coke
TOTAL VALUE FROM MEDIA TIE-UP Rs 5 crore

Lage Raho Munnabhai
Reliance Energy
Reliance Communications
Good Day
MSN Live Messenger
TOTAL VALUE FROM MEDIA TIE-UP Rs 5 crore

Don
Garnier
Louis Philippe
Citibank
Oakley
Motorola
Tag Heuer
Airtel
Hungama.com
TOTAL VALUE FROM MEDIA TIE-UP Rs 12 crore

Krrish
Lifebuoy
HP Power
Acron Rangeela
Hansaplast
John Players
Pantaloon Retail
Singapore Tourism
TOTAL VALUE FROM MEDIA TIE-UP Rs 22 crore

Malamaal Weekly
ITZ Cash
TOTAL VALUE FROM MEDIA TIE-UP Rs 1 crore

Corporate
Durian
Allen Solly
TOTAL VALUE FROM MEDIA TIE-UP Rs 2.5 crore

Taxi 9211
Bombay Dyeing
Yamaha
TOTAL VALUE FROM MEDIA TIE-UP Rs 2.5 crore

Kabhi Alvida Na Kehna
Compaq Presario
Videocon
Airtel
TOTAL VALUE FROM MEDIA TIE-UP Rs 5 crore

OTHER FILMS: RS 20 CRORE
TOTAL: Rs 75 crore
Source: P9 Integrated

Welcome to the ritzy-glitzy world of associative marketing, also known as out-of-film marketing, where a movie lends its name to sell a brand with what are known in industry lingo as 'promotion tabs,' even as the producers rake in the moolah by allowing brands to use their films as advertising vehicles. Guru-Hero Cycles is the latest example-other promotion tabs in Guru are for Blackberrys suitings, and Intex office automation systems-and not an isolated one. Before that Coca-Cola flagged off its Coke Uthale, Dhoom Machale campaign, with Hrithik Roshan endorsing the brand in the same gear he's seen sporting in Dhoom II. In fact, this commercial has even been shot by the director of Dhoom II, Sanjay Gadhvi. Then there's the remake of Don, in which Garnier Naturals rather ingeniously promotes its hair colour with the song Yeh Mera Dil, picturised on Kareena Kapoor. Also, the A.V. Birla group's apparel brand, Louis Philippe, has chosen the movie to launch its 'Don line of clothing'. The campaign with a dapper Shah Rukh Khan adorned in Louis Philippe threads isn't exactly subtle: Louis Philippe, inspired by Don, goes the slogan. The Louis Philippe collection was in turn promoted in the film. Amongst the flicks in the pipeline, Vipul Shah's Namaste London, which revolves around an NRI wedding, is understood to have roped in Bharatmatrimony.com for associative marketing, via a multimedia campaign. And in a yet unnamed film, in which Rani Mukherjee is apparently playing a high-class sex worker, a phone from the Vertu Constellation series-price tag: Rs 3,00,000-is said to be keeping her company, too.

If marketers are gravitating towards films, the move may have plenty to do with television losing out in effectiveness as a vehicle
Unlike conventional television ads, promotional tabs are not a function of secondage (10 or 30 second spots) but of weeks
"Films as marketing tools are important for most brands and vice versa"
Navin Shah/ P9 Integrated
"With movies you have got a captive audience for an ad, unlike with television"
Sanjay Bhutiani/ B.R. Films
Clearly, producers and marketers have realised that one surefire way through the clutter-of film and product/service promos-is the out-of-film route. Nudging a film's protagonist into an advertising campaign in an avatar that's similar to his/her role, it would seem, is a great way to endorse a brand as well as the movie at one go. Says Navin Shah, CEO of P9 Integrated, an integrated marketing communications agency: "In the current entertainment scenario, traditional strategies are not working effectively in the new media space. Consumers have become demanding and therefore brands have to come up with new ideas constantly. In a country like India, movies are one thing that appeal to everyone. And with more organised players in this space and also with the emergence of multiplexes, films as a marketing tool have become important for most brands and vice versa." P9 Integrated has positioned itself as a provider of 360-degree solutions in the space of motion pictures, entertainment products and television content. P9 struck the deal for Blackberrys and Intex for a multimedia campaign with Guru.

If marketers are gravitating towards films, the move may have plenty to do with television losing out in effectiveness as a vehicle for communicating messages to viewers. Says Sanjay Bhutiani, Director, B.R. Films: "A movie today is getting released in India in more than 1,000 prints. If on an average 100 people are watching one show of a film, that's 1 lakh people. If you have four shows, it's 4 lakh, and if it's 12 you've got an audience of 12 lakh. It's a fantastic opportunity for advertisers. With television you don't even know if people are watching the advertisement; with movies you've got a captive audience. Which other medium gives you that sort of exposure?" Adds Prabhat Choudhary, a marketing and communications specialist with Spice, an entertainment-focussed agency: "Films themselves have become big brands now and with more sophisticated marketing tools well-established brands want to ride on films for better and closer visibility."

It's this huge opportunity that's persuaded a rash of entertainment and communication-related firms-right from media-buying houses to multiplex chains to television software producers-to cosy up to Bollywood. Shah of P9 estimates that "at least 25-30 corporate houses have got into the business of Bollywood film-making." Media buying houses like Broadmind, Starcom, Madison and, of course, P9 are working closely with the film universe. And Reliance with Ad Labs and tv18, with a new outfit christened Studio 18, is also eyeing a slice of Bollywood. Interestingly, Bhutiani of B.R. Films has an advertising background-rather than films-and is quick to point out that it is not unusual for Bollywood these days to employ people with experience in brand-building, marketing and advertising.

To be sure, the relationship between brands and films has been underway for some time now. It began with plain vanilla in-film placements, and moved on to the movie-cum-commercial format, as Castaway was for FedEx, and You've Got Mail for AOL, in Hollywood. Back home, Ram Gopal Varma's Road did something similar with Tata Safari, with the automobile captured in virtually every frame of the movie. These days, though, in-film advertising is passé, or rather just one prong of the communication strategy. Earlier this year, Lenovo, the laptop maker, used clippings of Madhur Bhandarkar's Corporate showing Bipasha Basu as a suave businesswoman, attending meetings armed with a Lenovo laptop. Apart from associative marketing, Lenovo also did an in-film placement in Corporate. Motorola and Tag Heuer got associated with Don (Shah Rukh Khan is also the brand ambassador for Tag Heuer), Lifebuoy, hp Power and John Players hooked up with Krrish, whilst Compaq Presario, Airtel and Videocon got associated with Kabhi Alvida Na Kehna (again SRK is the brand ambassador for all the three brands) for associative marketing. And Kotak Life Insurance tied up with the film Babul-for an in-film insertion as well as an ad commercial.

By allying with films like Guru and Don, Blackberrys and Louis Philippe are merely leveraging the power of the brand. Indeed, clothing lines have for long been inspired by Bollywood films: For example, Madhuri Dixit's Hum Aapke Hain Kaun ghagra cholis and Hema Malini's Baghban sarees sold like hot cakes with the masses, but the difference was that the advertisements for these products were generally by word of mouth in the largely unorganised sector. Marketers today are attempting to create a fit between film characters and their brands. Says Hemchandra Javeri, President, Madura Garments: "Don, which epitomises fashion, style and sophistication, has been a cult film for decades now. Louis Philippe also portrays similar attributes." Adds Darshan Bhalla, CEO, Madison & Teamwork Entertainment Services (mates), which struck the deal between Louis Philippe and Don: "Films are on a high note in our country, and to that extent a film can work as a multiplier for that brand.

Lenovo is another brand that's cottoned on to the associative marketing mantra. As Rahul Agarwal, General Manager (Marketing) for Lenovo South Asia, says: "We are a new brand and we are constantly looking at newer ways to reach to our consumers and create a brand recall. Films and TV shows are one such method. We found that the script of Corporate was relevant and a perfect brand fit. We did 15 minutes of brand placement for Lenovo Notebook, which is quite a bit." Lenovo has also tied up with Metro, yet another Madhur Bhandarkar film, which is slated for release, for in-film placement.

Industry observers aver that associative marketing is a more comprehensive solution than just in-film placement, and hence more economical. Shah explains that in-film placements are constrained by a huge time lag (in the sense that in-film placements have to be thought through right from the script stage and then one has to wait till the film is released in the box office and thereafter for a few weeks to realise its potential). Also, it's a high-risk model to the extent that the fate of the product is dependent on the film's success. "The recall value via associative marketing is higher and the return on investment (ROI) for a brand is nothing less than three times. The ROI for an in-film placement is anywhere between 0.5-20 times but it is dependent on the success of the film," says Shah.

U
nlike conventional television ads, promotional tabs aren't a function of secondage (10 or 30 second spots) but of weeks. Their shelf life typically extends to five-six weeks-three weeks before release and a few post-release-and the cost of a campaign, depending on whether it is single or multimedia, can range from Rs 40 lakh to Rs 4 crore. In-film placements are cheaper, in the Rs 5 lakh-1 crore bracket, depending on the size of the film, its star cast and how integral the brand is to the film. "From a producer's perspective it gives the film a good recall value before release. Even if it's co-branded and the TVC is skewed towards the brand it still works for the film," says Bhalla of mates.

Marketers for their part are encouraged by the results of in-film placements combined with promotional tabs. Agarwal of Lenovo-which apparently sets aside 5-15 per cent of its consumer marketing budget for such activities-is pleased with the response. Javeri of Madura Garments says the Don collection has been sold out. It isn't as if associative marketing is devoid of risk. The core idea of the brand and the film has to match for the association to work. The creative of the promotional tab too is crucial, and could determine whether the association works or not.

Yet, as more and more marketers begin to ride the wave of associative marketing, the fledgling trend itself is expected to mature. Shah believes that in another 6-24 months, films and brands will collaborate on some serious innovations-just like Ray-Ban did in the us, when it created a special 'Ray-Ban-Men In Black' series. "That is going to be the next step in Bollywood film marketing innovation. Which means brands will associate with a film, and they will create a special, limited-edition product based on the film, and they will put in a serious marketing budget to promote the product and probably they will achieve some continuous growth," says Shah. The Ray-Ban-MIB series was a huge success, selling more in six months than Ray-Ban's entire catalogue for the season. Shah adds that once such innovations set in, "a Rs 80-crore market of associated marketing will become a Rs 800-crore market." That day can't be too far away. Already, at the time of writing, at least three films were in various stages of production, which interestingly are being weaved around brands, which are the co-producers, coughing up half of the film's overall production costs. The heroes of those films clearly are stacked up against some serious competition!

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