Tuesday, November 04, 2008


Of Cricket expenditure and Coffee

Is Cricket Expenditure Justified?

By Harish Bijoor

Q: Can a savvy marketer’s expenditures on cricket ever be justified. This baffles me. There is so much of spend and so little of physical return in terms of sale volume. I am totally distraught by this trend.

-Rohit Datta, New Delhi

A: Dear distraught Datta, cricket expenditures are largely brand-building expenditures, unless the brand in question is a new launch altogether. For brands such as a Coke and a Pepsi, and possibly a Titan or a Tata tomorrow, cricket is all about building the brand imagery of the existing brand at large and typing up the thought-process of the game with the thought-process of the brand and its synergistic offering at large.

It works this way. If the brand is question is a Pepsi with its young and bubbly imagery, cricket is a great game. Think of cricket and think Pepsi. In reverse, think Pepsi and think cricket. This is the beneficial linkage that most brands expect to leverage with their mega sponsorship moneys.

When you convert this into sales numbers in terms of crates sold however, the linkage slips in its delivery. To that extent, if you did an ROI on such game-sponsorship gambles, the numbers don't necessarily stack up to a positive figure. Therefore, this expenditure is something you need to amortize as part of your long-term brand building process.

For a new brand launch however, things work differently. If a Yakult was to launch its offerings with a cricket season of sponsorships, things would work to its advantage in image terms. Fundamentally, the awareness scores that such a cricket association can create for an unknown brand is tremendous. The multiples in terms of image awareness and interest parameter terms would justify such expenditures for new brand launches.

This is the reason why most companies that sink moneys into such deep cricket sponsorships put together launches of variants of their drinks. Pepsi Blue was one such, and we know there are many such offerings up the sleeve for this season of discontent. Pepsi Gold is another. Never mind that the Indian cricket team is at his point of time no where near the gold!

Q: In recent times we see the active use of the word “pro” in our brand marketing statements on advertising. Wassup?

-Andrew N, Hyderabad

Andrew, "Pro' is a cute little pre-fix. All of three letters, short, crisp, and
completely positive. "Pro" is really all about being with you.

This pre-fix is therefore a potent brand semantic to use to advantage. It
is all being life-friendly. It is a semantic that fights the negative.
Pro-biotic would therefore mean something that actually fights many a
downside to the human body and its bio processes.

This is terminology that crept into the advanced brand markets of the West
and East alike in the early nineties. Since then, they have established a
potent position in consumer minds. Something every successive generation of
brands have reaped from over the years. It is now the time of the Indian
market and its brands to use and reap the "pro" word.

Pro is all about "professional" as well. Therefore in sport, you have the
use of "Pro-Am" championship, etc. Golf, Badminton and literally every other
sport uses it. This gives the word a positive cue as well.

Pro is used in advertising stances as well. Such as Pro-Life, Pro-diabetic,

I think this prefix is coming of age. The Indian market is two generations away form the American in terms of marketing usage. And one generation in marketing terms today is
all of 4 years. We are therefore around 8 years behind the US market.

Take for instance the market for Vitamin-enriched waters. We are nearly 8
years away from where it started in the US. The Vitamin-enriched waters
revolution has not yet hit India. It will.

Any prefix that has the positive terminological use will always help. Pro is all
about positivism and this lingo is bound to appeal to the Indian at large
who is getting very health conscious. India is emerging as the capital of
the life-style disease. On diabetes we are already there. Heart disease,
Hypertension, BP-negatives and Cholesterol related causes are not far way
in the great Indian marketplace, where our food habits are largely

As the awareness surges, consumers will start investing gin preventive
health-care more rather than only the curative. As this happens, the pro
word is going to gain in further significance.

I would bet my best marketing buck on the pro word for success. It is
certainly the next "Free" of the modern consumer world.

Gone then are the days of “Ultra” as in “Ultra-rich”. There will be no “ultra-rich” ice-creams in the future. Instead, it will all be about “Pro-life” ice-creams! “Super” is dead as a prefix as well. Words will come and words will go in the world of marketing.

Q: What is a value chain in marketing terms, and how long is it?

V Paneerselvan, Madurai

A: Paneer, the value-chain is a concept that is all about adding value to the basic offering of a commodity or a brand. The value-chain is a ladder you climb in terms of value-realization as you brand a commodity for instance.

Here is an example form a category close to my heart. Coffee. The value chain in coffee is simple but long. At the bottom rung of the chain is the green bean. We have been exporting this for long number of years. Value-add is the lowest here. A player involved in green bean export is essentially a player in the volatile international market for the commodity. International commodity price movements give us big hiccups or pangs of small joy. We are completely at the mercy of the commodity market price, which is often controlled by tangible factors, and at times by the intangibles, such as the fancy of International funds that may park money in coffee as a commodity. In that sense, coffee is a scrip that is traded on two bourses, the New York and London terminals.

Just above the green bean, in terms of better value is the specialty green bean. Here, beans are segregated and there is quasi-branding. People run behind these grades and are willing to pay a price.

Just above this is the roasted bean. This can go in packaged tin forms into consumer markets of the West and East alike. And above this is the Roast and Ground category, where coffee moves in powder form in functionally oriented packaging forms that keep freshness intact.

Higher still is the soluble coffee format. This is really instant coffee. Then just above this in value terms is liquid coffee. This can go to direct consumption businesses like small Café-chains, through vending machines, to homes in small dispensation bottles, and of course through company owned Cafes as well.

Higher still, there are many routes, but let’s stop here, as we are entering sensitive space.

Harish Bijoor is a business strategy specialist and CEO, Harish Bijoor Consults Inc.

Email: harishbijoor@hotmail.com

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