Sunday, November 11, 2007
How will small retailers survive the onslaught of modern retail?
Nudging the Future
Q: I recently saw this ad for a light switch which just does not make sense. This lady throws a book at a switch. Everything breaks but this switch is intact. Bizarre!
What is this all about?
-Rupa Kulkarni, Mumbai
A: Rupa, I have seen this one as well, and have kept wondering.
There are two ways of looking at this. One is the intelligent way, imagining that there is method in the madness of this ad. The other is to say that this is a foolish ad.
This ad comes from the genre of drama that is heightened for effect. The story line is clear. Here is a sturdy switch. The drama that surrounds it all is meant to arrest the viewer. Arrest him enough to remember the brand name in question. I am sure this ad does the job on that score.
Sometimes, brands tend to advertise with the ridiculous. The intelligent idea is to stand out from the clutter of well-made ads. Ads which make consumers ask questions such as the ones you ask, serve a purpose as well. The brand name comes to the fore. Is this buzz advertising of a kind? Advertising that is purposely bizarre and ridiculous? Just to make you sit up and remember the brand name? Maybe yes. Maybe no.
The point to think is this. When all ads start looking alike, the one ad that looks different stands out. In this day and age of clutter, the marketer is possibly willing to use anything to stand apart from the rest and make the best of the fragmented TRPs he is getting.
Remember the PSPO Fan ad of yore? A high decibel ad that had everyone shouting from the rooftop.
Q: With the Indian market for retail opening up to foreign players, albeit slowly, how will Indian retailers cope? Are we in for trouble?
A: Amit, with the domestic retail environment opening up, Indian retailers will be forced to compete with better quality, a distinctive array in terms of range of offering and more realistic prices.
In many ways, this churn will result in the traditional margins of retailers undergoing
a squeeze. The clever retailer will however reinvent himself to face the
the needs of a billion plus people. The ratio of shop to human being is
better than the ratio of doctor to human being in this country.
These shop-keepers come in an amalgam of sizes. At one end we have a
nano-percentage of stores that are large format super-markets. Just below
them we have a larger medium-sized grocer and retailer of this and that, be
it lingerie, cosmetic or fancy good. And then right at the bottom of the
proverbial pyramid are a whole host of small shop-keepers who help this
country run its business.
I do believe the small shop-keeper will largely remain unaffected by the
aggregation of business with retailers from overseas entering the Indian
market. These nifty operators are widely dispersed in terms of geography and
cater to an important need of the masses. Organized retail as
attempted in developed economies, cannot aspire to cater to this role played by the micro-outfits of the day, with efficiency. These tiny outfits will therefore not only survive, but thrive as well.
The ones who will be really hit are the medium sized stores. They will slip
between two stools. At one end they do not have the scale and the
efficiency that comes from scale. And at the other end, neither do they
fulfill a vital irreplaceable role that the smallest of small retailers
perform in this country.
These medium sized retailers will suffer a process of sudden death. As large
format retail enters the Indian market, it will take all of 2-5 years for
these medium sized retailers to collapse, reinvent other models to survive,
and migrate out of the retail business of yore altogether.
The battle of Indian retail will therefore be one between the Goliath from
overseas and the David’s of medium sized Indian retail. The Lilliputs of
retail on the other hand will survive and thrive. These are the guys who run
this nation of shop-keepers.
Q: Mars has re-branded itself as a chocolate. What is this “Belief” branding all about?
A: Sajini, first of all, nothing is sacrosanct. Even brand names must and can change.
The new branding initiatives of Mars and others at large that look at themes such as Belief and Faith and Trust are embracing a brand new inclusive branding movement.
Brands have over-done the limited brand propositions to death thus far. In the beginning, one spoke of a toothpaste that brushes your teeth well and clean. Then it went on to say that it whitens the best. And then one added colours to the toothpaste. There came red stripes and then blue and then all three red, white and blue in one toothpaste.
When consumers got tired of this, in came the gels of different colours. The colours kept changing. And in came the gel with sparkles. And then in comes toothpaste with Oxygen in it!
When one tires of all the physical product and imagery propositions and appeals that seem just too rational, the marketer explores the irrational a bit more. Here one is experimenting with concepts that talk about what a toothpaste can do to you emotionally. Even this is done to death. Toothpaste that can make you fall in love? A toothpaste that can get you a new job?
And then one taps into the final frontier. This frontier is what I call inclusive branding.
Branding is essentially an exclusive process. It is all about offering the exclusive to the exclusive.
Inclusive branding s about building brand propositions that embrace one and all and make the brand accessible to an inclusive mass of people.
Inclusive branding is all about taking the mega thought and platform. The big idea that is really, really big. So big, that it sounds ridiculous when first adopted by the brand. Faith is one such. Belief is another. Truth can be another.
These brands are trying to exploit the underlying need for these large formatted life propositions.
While doing this one needs to be careful to integrate these large-format ideas seamlessly into the brand and must leave the consumer with a credible notion and not a notion that can put the consumer off or make her laugh.
Harish Bijoor is a business strategy specialist and CEO, Harish Bijoor Consults Inc.