Marketing review

06 Mar 2004

Children exert increasing influence on purchase decisions
A study conducted by Ogilvy & Mather's 'discovery group', which conducts brand planning, consumer insights and knowledge management on Indian kids, along with direct advertising, branding and marketing implications and learning, has found that children exert influence on a large category of purchases, apart from those where they are directly concerned.

At present children's influence spreads across household categories such as technology, automobiles and appliances as well, says the study. Moreover, the study also finds that children play an important role in brand building.

Recognising this, marketers like Maruti, Orange and Dishnet DSL have started using children as a powerful audience.

Broadcasters' plea turned down by EC and I&B Ministry
The Election Commission and the Information and Broadcasting (I&B) Ministry have put paid to private broadcasters' hopes to to strike a bonanza from the expected advertising blitz planned by various political parties. Both organisations say that existing laws do not permit political parties to advertise on the electronic media.

The Indian Broadcasting Foundation (IBF) which includes TV Today, Zee Telefilms, BBC World, Star and Discovery, recently met Chief Election Commissioner T S Krishna Murthy to apprise the legal position of the issue.

They said that as far as a large majority of uneducated voters were concerned, television was the only media through which they could get information about political parties and candidates, which would enable them to make an informed choice. They also said that they should not be deprived of revenues generated from advertising by political parties.

The EC's view is that there are too many news channels and local channels to be monitored by the government and that the channels would have to adhere to the existing provisions of the Advertisement Code of the Cable Act which disallowed political advertising.

Coke launches Maaza in small packs
Coca Cola India has launched its mango drink Maaza in 200-ml and 250-ml packs across the country. The company says it will soon launch the fruit drink Maaza in 125-ml cartons and introduce 600-ml pack size for Coke and Fanta.

Coca Cola had earlier reduced prices of the 1.5 litre and 2.25 litre pack sizes to Rs 30 and Rs 43 of its carbonated beverages — Coca Cola, Fanta and Sprite. In addition, the 600-ml packs of these drinks will be priced at Rs 15.

The company has also come with a new commercial developed by ad agency Leo Burnett positioning Maaza as an enabler of fun friendship between mothers and kids woven around the tagline `Yaari Dosti Taaza Maaza'.

Handset makers slash prices
Nokia, Motorola, Samsung, Siemens, Alcatel, Sony Ericsson and Panasonic have announced price reductions on all their models from the basic and mid-range to top of the line fashion lifestyle models ranging from of 5.36 per cent to 26.58 per cent.

The price cuts were implemented soon after the "mini-budget," which reduced basic customs duty from 10 per cent to 5 per cent and abolished the special additional duty of 4 per cent.

The price reduction for the entry-level handsets range from 7.5 per cent to 20.73 per cent. While the minimum reduction will be on the Siemens A 60 (from Rs 6,800 to Rs 6,290) and Motorola C350E / C266 (from Rs 5,995 to Rs 5,545) the maximum reduction will be for Motorola C 350 from Rs 6,995 to Rs 5,545.

In the mid-range category, the minimum reduction of 6.67 per cent was announced by Motorola for its C 375 model (from Rs 7,495 to Rs 6,995) while the Panasonic G 50 will be available at Rs 7,500 down from Rs 9,000 — the maximum reduction of 16.67 per cent.

In the premium lifestyle handsets, Motorola E 365 will now cost Rs 12,295 against Rs 12,995 a drop of 5.38 per cent, while Nokia N 6100 will cost 26.58 per cent lower (Rs 11,379) instead of Rs 15,499.

Nokia has also dropped the price cent on its technology featured N 9210i from Rs 33,899 to Rs 29,679.

Metro plans to expand in South
Metro Cash & Carry India Pvt Ltd, which was allowed to undertake wholesale trading in the country, is planning to expand its operations to the south. It says that the state governments of Andhra Pradesh and Tamil Nadu had approached it with the offer to amend the agriculture produce marketing committee (APMC) act to enable the multinational chain to set up distribution centres.

Metro Cash & Carry is a part of the $55-billion German trading giant Metro AG. However, its India operations are restricted to two large-sized centres in the outskirts of Bangalore in Karnataka.

Reliance IndiaMobile launches watchphone
Reliance IndiaMobile has launched an all-in-one wristwatch-cum-mobile phone, with a plug-in camera, the Telson TWC 1150, targeted at the younger generation, priced at Rs 23,900.

According to the company, the product, manufactured by by Telson Electronics, is the world's lightest CDMA2000 1x phone.
The watchphone weighs 98 gm and has several features including a loudspeaker, voice recording and voice recognition capability, infrared earpiece and polyphonic ring tones.

It also has a speakerphone facility along with infrared "finger-ring" type earpiece. Its high-performance battery enables a talk time of up to 100 minutes and standby time up to 150 hours.

Included in the handset kit is a plug-in high-resolution 3,30,000 pixel digital camera, which can save up to 80 pictures.

The camera can also be attached to a phone book. The phone book can store up to 200 entries with four numbers, email-ID and URL, photo caller-ID and displays a photo of the caller.

The product is being launched in Mumbai, Delhi, Chennai, Bangalore and Hyderabad initially and will be available at the Reliance WebWorlds and retail outlets at these cities.

Titan to sell Tommy Hilfiger watches
Titan Industries will now sell the international fashion watch brand, Tommy Hilfiger, in India. It has signed an exclusive marketing and distribution agreement with the New York-based Murjani Group which, through GVM International, holds the licence for Tommy Hilfiger lifestyle products from Tommy Hilfiger Licensing Inc, a wholly-owned subsidiary of Tommy Hilfiger Corporation.

Titan feels that Tommy Hilfiger will not only complement its portfolio in the premium segment but also strengthen its position in the fast growing designer watch market in India.

Priced between Rs 3,500 and Rs 8,000, the Tommy Hilfiger watch collection will be available at Titan's retail outlets across India.

Earlier, Titan had a joint venture with the US-based Timex Corporation, which broke off a couple of years ago.
The Tommy Hilfiger brand has presence in apparels, accessories, footwear, fragrances and home furnishings, as well.

ITC's rural malls to come up soon
In April this year, ITC's first rural supermarket will commence operations close to Bhopal in Madhya Pradesh. The mall will stock soaps, colour televisions, two-wheelers and even tractors. The company is also in talks with service companies to retail banking and insurance products at the supermarkets.

The company plans to set up four such malls this year, two each in Madhya Pradesh and Uttar Pradesh and if the malls are successful it will set up 80 such `malls' in the two states.

The supermarkets will be located at ITC's `hubs,' where farmers can come to sell their produce and are a part of ITC's e-choupal project.

ITC's first hub-cum-supermarket is located near Bhopal on eight acres of land. Apart from the mall, it will contain godowns for storing wheat and soyabean and stock products retailed at the mall, a petrol pump and a parking lot for 160 tractors.

P&G slashes prices of Ariel and Tide
Trying to get further volumes in its detergent business, Procter & Gamble Home Products Ltd has reduced prices of its Tide and Ariel brands by 20-50 per cent. The company had reduced sachet prices last year and according to officials, the results of the cut gave it confidence to drop prices for the detergent bags as well.

The price of a one-kg pack of Ariel will now be reduced from Rs 135 to Rs 99, while the price of Tide has been slashed from Rs 85 to Rs 46. The prices of the 200 and 500 gm packs have also been reduced to Rs 22 for Ariel and Rs 10 for Tide (earlier Rs 30 and Rs 20 respectively) and Rs 50 for Ariel and Rs 23 for Tide (earlier Rs 70 and Rs 43 respectively).

The company says it has improved upon its internal efficiencies in areas such as distribution, manufacturing and cost of raw material and will pass on these benefits to the consumer.

P&G has roped in well-known faces such as Ms Smriti Irani and Ms Aparna Mehta from the popular soap opera Kyunki Saas Bhi Kabhi Bahu Thi, to endorse its brands and will come out with new commercials as well signaling a significant jumps in its ad budget.

The company expects volumes to be higher than the price reductions and so if Tide's price is slashed by 50 per cent, its volumes are expected to more than double.

— Compiled by Mohini Bhatnagar