Blockchain & Its Application in Marketing - Part 2

This is the second post in the series of three posts on Blockchain Technology and its application in the field of Marketing. While in the first post, we discussed the concept of Blockchain in a very simplistic way along with examples, the next two posts including this one, are intended to use that knowledge about Blockchain and understand how the concept can be used in the field of Marketing. 

This post will first explain the Blockchain technology again with a little technical detail since we need to know what the technology can bring in for the Marketing areas. Later we bring out the possible applications. Mind you, these are not the applications for the year 2100, hence may not be fairly imaginative. The idea is to see what can be done tomorrow!

If you have not gone through the first post yet, please take time and read it before you comeback to this post. Read time is 10 mins.

Blockchain & Its Application in Marketing - Part 1

In the previous post we saw that Blockchain is a concept which at its core has ability to create, process, store and manage data efficiently. It does this with the help of three of its inherent properties:

• Distributed ledger: Multiple entries across different systems (‘Distributed Records’ across various machines, hence the name)
• Records changed on one system will be easily identified and corrected
• Consensus mechanism: Any update that has to be made to a record must have consensus of all the machines in the network for it to be updated
• The changes cannot be made by any one of the record holder but has to be done based on the consensus
• Decentralized storage that helps in creating an indelible trail of transactions which makes the system transparent, shared, secured and watertight. 
• The ownership of data is distributed among various systems and users

Hence, Blockchain technology (while many argues it is a ‘concept’ not a technology in itself, we would not get into that debate in this post) has ability to manage issues like data security, data transparency, data manipulation, real-time tracking and ownership of data, for any given business scenario.

Without going into much technicalities, let us understand the above points through a simple example:

A data unit is stored on a system under the “Name” tag as ‘Tapish' in a bank.

Case without Blockchain: Someone, by mistake or intentionally writes the name into a document as Tapishh, with an extra h at the end.

Now, the data storage is not on the basis of distributed ledger, hence there is only one data set where the name has been updated as Tapish’h’. After this, nobody knows what was the real name?

Since the updation worked on a non-consensus mechanism, that one person was allowed to change the record all by himself.

Fig 1: Three Blocks of Information

Fig 2: Data Manipulation in Case of Blockchain

The data was kept at in a centralized manner at one place with a clear ownership lying with the bank. Hence, no one but bank can change it again, which gives bank the power to collect, record and store without any restrictions.

Fig 3: Applications of Blockchain in Marketing

Case with Blockchain:  Due to consensus mechanism, that one person will never be able to make change on his own as every change needs consensus between multiple parties.

Due to it being distributed ledger, any change made on data on one system which does not reflect in other systems, will not be accepted.

Since the data is decentralized, the bank does not have the authority to unilaterally change the data hence democratizing the right for updating information.

Now we quickly see the concept on which this works in a very simple way. The core of this concept is how the data is stored and managed. The data is kept in a block. Each block or data set has three parts:

• Data: Any piece of data unit. In this example, a name, Tapish
• Hash: Identifier of the block. In this example, AB12
• Previous Hash: Hash: Identifier of the previous block. In this example, For Block 2, Prev Hash AB12 , is actually the hash of Block 1.

As you see in the second picture, an intended manipulation in Block 2 (From Tapish to Tapishh) has ended up changing the Hash of Block 2 since the data is not the same anymore as it was. It is Tapishh instead of Tapish.

The moment this Hash changes, there is a mismatch between the Previous Hash Value of Block 3(CD34), which was nothing but the Hash Value of Block 2. Hence this change has been identified as being non-consensual, and is not reflected in various ledgers.

This manipulation can then easily be pointed out and corrected with Blockchain concept, which would either be impossible or difficult with high cost involved in case of earlier concepts without Blockchain.

Now, when we know of the clear advantages that Blockchain technology bring to the table, let us jot down where in the field of Marketing can this be used?

We now look at some of these areas where the introduction of Blockchain has the potential to bring phenomenal change.

Area	Application
Advertising	Delivery and Engagement Verification       What? – There is significant fake inventory that eats up major advertising dollars via domain spoofing. An estimated $16 billion of advertising dollars have been spent in 2017 on fraudulent sites. Brands are usually dependent upon a host of middlemen for making their product available to customer’s door through online channel. Then there is also a lot of opaqueness on whether and how many of the audience actually saw the ads and for how long.        How? – Blockchain can allow resellers to label their inventory as legitimate with public Blockchain (Public Blockchain are created when the data need not be private and cane viewed by others), that means it is easily verifiable and near impossible to fake. This is possible through decentralization and identifier tagging aspects of Blockchain technology. It can also allow to add information blocks to the specific ad piece with the audience information which will be then stored through decentralized system to various systems making it virtually un-hackable.  Partners Incentive Management         What? – Incentives to partners for advertising efforts is a key area in the advertising domain. To ascertain the attribution and its magnitude, in order to incentivize the partners and vendors, a marketer requires data on the performance of the advertisement. This could be a running ad or a campaign, and any leads or conversions it generates. However, this can be done only if there is sufficient integration and cross-platform collaboration across platforms and channels. This level of data is hardly available and even if it can be weaved together, requires expensive efforts and time with limited assurance of accuracy. It is often not clear as to who owns the data and who should be incentivized.       How? – Blockchain with the help of its identifiers (block added with every piece of data for every change made creating a chain of blocks, hence ‘blockchain’) helps in creating a trail of events which can be easily tracked for each source and each destination. So the advertiser/publisher knows which agency/middlemen should be paid what.
Consumer Engagement	Loyalty Program Management What? – Poor loyalty program integration not only costs companies dearly but they also are wildly unsuccessful in their single point objective of engaging with customers. This is caused by poor integration of reward programs, inflexible reward structures & lack of visibility of the transactions for the company as well the customers. Also that the loyalty programmed are company specific and at best alliance specific. This means that customers are bounded in terms of engaging only with the limited and pre-defined companies through the loyalty program.  How? – Blockchain with the help of its identifiers (block added with every piece of data for every change made creating a chain of blocks, hence ‘blockchain’) helps in creating a trail of each transaction and event(occurrence) which can be easily tracked for each source and each destination. So the advertiser/publisher knows which agency/middlemen should be paid what.  Customer Experience What? – Customer reach-out, engagement, relationship and bonding are some of the areas which have a strong need of record keeping of customer data which is not just collected and stored in a secured location, but can also be processed and managed to create real-time insights. This in turn should lead to positive customer experience. However, more often than not, companies find themselves in a tight spot while dealing with customers, some of them being associated with the company for a long time. This is due to poor record keeping, incorrect records and highly centralized information storage. How? – Blockchain with its impermeable record keeping mechanism with the help of identifiers, and its decentralized ledger helps in keep data not only up to date but also accurate resistant to any erroneous update. Each record is saved with an identifier block which not only stores the changes made to the data but also keeps the history of the record. Decentralized ledger help in maintaining the sanctity of the information with the help of consensus mechanism.
Influencer Marketing	Reach and Engagement Verification What? – Influencer marketing in the age of social media has adopted a whole different meaning. We have seen the rise of many influencers across the globe pan social media platforms who engage with their audience through their content. Brands piggy ride on their popularity, to achieve a ready-made set of target audience. However, there are various difficulties identified in this alliance such difficulty to ascertain if the claimed reach and engagement levels of an influencer are real. Is your dollar tagging with the right influencer? How? – Blockchain’s decentralized ledger would help in storing the correct information about the influencers and will also store all the related information like content publishing and magnitude and intensity of engagement with audience. This will not only bring out these details for each influencer in public, hence ensuring right fit that brands could find with influencers. This can also help in arriving at precise incentives that could be paid to the influencers. Authenticity of Followers What? – Bulging one’s audience list through unscrupulous measures including having bots as followers are some of the ill practices on social media platforms. In a list of thousands to millions of followers it is virtually impossible to find out how many of these followers are bots and how many are real. This has an effect on marketing strategy and marketing dollars that are paid for the influencer marketing, hence plays a critical role for the marketer. How? – Here again the decentralized ledger of Blockchain helps in identifying and segregating the genuine users from the bots. It is done by scrutinizing the activities conducted by the bots on the social media, which is identified by the means of the block or the identifier that is attached to it for every transaction or event. Consensus mechanism helps in ensuring that manual intervention is not possible and hence accurate details about bots is made available.
Sales	Online Sales What? – Brands are usually dependent upon a host of middlemen for making their product available to customer’s door through online channel. While online and direct channels have their own advantages, the overall management of the online channel is highly depended on the access, security and storage of customer and product information. Frequent data security thefts have opened fissures on this much touted channel of marketing.  How? – Blockchain will help companies manage a one stop solution for its product with secured document trail and integrated functions. Its consensus based decentralized ledger makes it virtually impossible to erroneously or otherwise manipulate the records making the online trail very secure and convenient. Sales Process What? – Companies and executives spend a lot of time in segregating leads and creating a historical data base for right focusing, which is still erroneous due to lack of veracity of data How? – Blockchain can ensure that the data available is verified and has a genuine source of each bit. This will help in reducing time in cleaning data and poor sales effort RoI.
Channel Management	Claims and Refund Management What? – A significant time of company executives and channel partners is lost in trying to resolve unsettled claims and refunds which are usually buried in tons of emails and excel sheets which are difficult to make sense of . These often lead to conflicts and poor performance and deteriorated relationships between the organization and the channel partners. How? – Blockchain with its strong trail mechanism with decentralized network architecture would ensure that all involved have the same information at all the time which is not only accurate but also consensual. Sales and Partner Incentive Management What? – Schemes and trade discounts are effective ways to push sales and increase channel demand. This also comes with a huge effort in terms of managing historical incentive payments, defining incentive payouts and managing records of all payouts. Many times this lead to issues and conflicts due to lack of transparency. How? – Blockchain technology will allow to store and manage the historical performance and payout to channel partners while also recording the transaction wise history of schemes performance, hence making it much easier and transparent for everyone.

That’s it for this post. However, we have just discussed a handful of areas here and pretty sure you can think up of a lot many if you have understood the basic concept of the Blockchain technology and where can it find its application. 

In the next post, we see some more applications of Blockchain technology which are indirectly related to Marketing, like Supply Chain, Legal Contracts and Identity protection for Marketing.

Cheers,

Blockchain & Its Application in Marketing - Part 1

This is the first post in the series of two posts on Blockchain Technology. This post is intended to create an understanding about the Blockchain technology  and it will be followed by the second post which will talk about various applications of Blockchain in Marketing.

A distributed ledger, a peer to peer network and a decentralized network system. Blockchain has been called all of that, and rightly so. There have been numerous posts and articles written about blockchain and what it can possibly do in future in various fields. These articles however, have still left many in binds about the fundamental and the prospects of the technology.

In this post, we walk through this new technology elixir in a ridiculously simple way to understand its founding. This may hurt sentiments of some experts, but I believe, like the fundamental of Blockchain itself, the democratization of its concept should also be transparent and decentralized.

So what are some of the problems that the Blockchain technology has potential to solve? Let’s briefly look at those first. Mind you, Blockchain is a technology that at its core create, process, store and manage data efficiently (too simplistic). Hence, it will be fair to assume, that its application will help in problems related to data. So here are some of these problems –

•                Lack of data security, For eg. loss, theft and change in data
•                Lack in data transparency, For eg. invisibility of data and how its stored
•                Difficult real-time tracking of data For eg. real-time asset location and movement
•                Inability to locate the accurate and precise value chain movement of product
•                Data ownership and control over data by limited parties in a centralized manner

Systems like ERP, CRM, SalesForce and others have in some way tried to help but none were able to solve all of the above problems at a time.

Hence, it should be understood that anywhere and everywhere, the problems cited above are present, Blockchain technology will find its application. Period. So now, think of all those places where how the data is created, stored, shared and managed, causes problems or create loopholes and darkspots. Yes, Blockchain can be applied to all these areas to solve those problems.

How does Blockchain do this?

So imagine this scenario. You want to buy a diamond ring for your loved one. You are also concerned that the diamond you buy is not from a conflict zone which helps in funding local conflicts or wars or is extracted through violence in the area. You wonder, if there is a way to find out that the particular diamond is ‘guilt’ free? Broken supply chain tracking and data opaqueness makes it difficult for anyone to confirm the source and the journey of a diamond from the mine to the jeweler. The keywords again are real time data, data accuracy and opaqueness.

A small platform pilot, Tracer, created on blockchain technology for De Beers involving a handful of miners and manufacturers was able to precisely do that. The platform helped in creating a secure and indelible trail of selected diamonds(high valued 100 diamonds to be precise) from the mine cutter, to polisher and finally to the jeweler, hence creating a strong asset-traceability. (Source:Reuters)

Now imagine this scenario. A financial transaction is initiated by you that is recorded in your account detail. The account detail is stored with the bank with which you have the account. The ownership of the data and any authority over it remains with the bank at all the times. Essentially making the bank the owner of the data. In case of an incident of data manipulation, since the data is centralized at one place (bank’s server in this case) with a single owner (bank in this case) and there is no transparency over how and where the data is stored, a data fraud or manipulation will be difficult to detect and reverse. This exposes the customer and the data to manipulative practices which are difficult to pin point and even more difficult to correct.

With Blockchain technology, the ledger (the book that records transactions) is distributed. Which means the book is not owned and controlled by one party but multiple parties or systems. Due to this arrangement, an isolated manipulative change in the data on one system will not be accepted. This is because the entry with this fraudulent transaction on one system will not match with entries on other systems. Any legitimate change on the other hand, can be implemented only on consensus  mechanism. It means that if  a change needs to be implemented, it can only be done through consensus between all the parties on the network and not by a single controlling party (like a bank or a data hacker in the above case)

This means that with Blockchain technology as foundation, fraudulent practices can be reduced to minimum, thanks to its distributed–ledger, consensus based updating mechanism and decentralization. Clearly, Blockchain technology can be implemented at multiple places where data security, transparency and ownership is complicated but important for functioning.

So based on what we know about Blockchain technology now, a definition can be put together for the same –

A decentralized distributed ledger sitting upon a network of computers which are updated for every transaction that happens in the system through consensus mechanism. This creates an indelible trail of transactions which makes the system transparent, shared, secured and watertight.

Of course, like any new technology or invention, Blockchain has its own challenges which need to be addressed for it to be viable, relevant and scalable. We will look at these challenges in the next post when we discuss what could be the potential uses of Blockchain in Marketing. Not like a laundry list which is abundantly available on internet, but based on Blockchain’s applicability which we know now. For more details on how Blockchain works technically, please watch this video.

Inner-circle counter branding- Ear and eyes open!

I recently came across a print-ad for Nasaka water purifier from Okaya group, and in no time a peculiar fact hit me. Veteran actress Shabana Azmi is seen endorsing the water purifier in the ad. The peculiar fact was that her son (from Javed Akhtar’s first wife, Honey Irani) is also seen endorsing the same category product, Pureit from HUL.

While, it is understandable that Farhan Akhtar is not Shabana Azmi's own son, and this conflict can very well be no conflict, an important question to ask here is, how credible does a product endorsement come across, when close family members, with equally strong brand image and credibility, endorse or anti-endorse products that are in direct competition or even substitution of that product or category.

The context and its implications of such a situation, also makes it imperative to judge if it is critical now to extend the boundary of due diligence and selection process for a brand ambassador beyond the individual to his closest set of people? Simply put, how pertinent it is to given to the individual’s image, appeal, relevance and credibility, should or shouldn’t the inner-circle deserves some notes and thinking, before inking  that million dollar deal?

Coming back to the first example cited, Both Shabana Azmi and Farhan Akhtar are known to be thinking actors and have associated themselves to a social cause every now and then. They have also managed to stay away from any major controversy adeptly, while being known for speaking their mind up. Crafty! Such attributes make them very attractive brand ambassadors for food and health category. Hence, Okaya and HUL were both bang on with the choice of their endorsers. However,  Okaya recently got Shabana Azmi to promote their Nasaka brand of water purifier, while it was well known that Farhan Akhtar promotes Pureit.

This can be a clean overlooking or may even be a thoughtful move. As Jack Trout and Al Reis suggest, in order to build a positioning in customer’s mind, try manipulating what is already there, instead of trying to create something new altogether. People know Farhan Akhtar and that he promotes pureit. So when Shabana Azmi comes up with an ad for another purifier, it helps than remember Nasaka since they would quickly relate Shabana Azmi to Farhan Akhtar, who is related to Pureit, and in the process will remember Nasak water purifier. Or at least the Nasaka marketers would hope for that.

Now, it is quite possible that people don’t fret much about how endorsements by members of a a particular star family cut, overlap or even counter each other, and they are able to remember them individually only attached to their respective endorsements. However, going by the argument in the last paragraph, connections are the easiest way to remember things, for example, Network maps, and hence it cannot be completely ignored that people may notice that while a male actor is promoting a tobacco brand, his star wife is busy educating people about ill-effects of Tobacco. This will not affect the Tobacco consumers but will definitely raise eyebrows on the sincerity of the star wife, and hence can mar the anti-tobacco campaign.

In order to ensure that such confusions and complexities are never allowed to find their way in the prospects’ mind, it is important that the due-diligence which is a regular exercise, post personality-alignment between the brand and the prospective endorser, is not just restricted to the prospective endorser but also to his or her inner-circle ie, the closest family members. The due diligence must along with other things (acceptability, appeal, relevance, credibility, social status, legal baggage etc) include a possibility of prospective endorsements and a contingency plan in case the family member’s brand endorsement interferes directly or indirectly with the primary brand endorsement. While this is a internal preventive technique, marketers can also adopt a regulated preventive technique where contracts pertaining to brand endorsements can be made to extend the exclusivity and non-compete clauses to family members. These of course will be difficult to draft as well as implement, and beyond doubt much more expensive.

There are of course various factors to consider before choosing one of the two techniques and a risk-impact analysis is a must before making a final call. These techniques can help marketers avoid losing their sleep over a challenger brand piggy-backing on their brand ambassador’s family member (and hence manipulating an already established positioning of their brand in the prospect’s mind!).

Bigger is better, or not! – Package size experiments in Modern Retail

It was in 1990s when FMCG companies struck the right chord with its rural consumers riding on a concept introduced by CK Prahalad. Serving those at the ‘Bottom-of-pyramid(BOP)’, turned out to be phenomenal success. The success did not constrain itself in the rural markets and proliferated to urban areas as well.

‘Low unit packing’, or (LUP) was an action borne out of the call made to serve the BOP customers which helped to create newer markets and penetrate existing ones for FMCG companies in rural as well as urban areas. Some examples of LUP were ‘chota coke’ at 5 Rs, shampoos and hair oil sachets at 1Rs (started with even 0.50 Rs) and Biscuits at 2 Rs.

While much has been written about the concept for all the long years since, then, this post points out to a contrasting selling and purchasing behavior emerging now, completely opposite to what led to the rise and rise of LUPs in late 1990s and much of 2000s.

To establish the contrasts, let’s briefly look at the reasons which led to the success of LUPs in rural markets. It was when rural and poor urban markets weren’t considerably tapped by FMCG companies. Products in most categories posed high purchase risks for customers in these markets and at most times, were simply unaffordable for them. Lower disposable income with high seasonal effect, daily or weekly income pattern since most of the consumers worked as daily wage laborers in fields and sites, bare minimum expense on hygiene products and branded food items, and unavailability of affordable yet beneficial options in local shops were some of the major factors that made LUP a winner.

Smaller units available for consumption on one hand helped the price sensitive BOP customers to sample the product without much financial risk, and on other hand paved way for international brands in rural areas as well as in urban pockets. Consumers were now exposed to quality products from international FMCG companies like HUL and P&G raising their expectations from the products they used and consumed. For example, consumers were able to use urban- & metro- brands like sunsilk, pantene and head & shoulders shampoos, close-up and pepsodent toothpastes, lux and rexona bathing bars etc.

Fast forward 20 years and a new trend seems to be emerging, especially with the advent of modern retail (departmental stores, hyper markets, super markets etc) and fast changing consumer profile. Make no mistake, two-third of Indian population still lives in villages and many living town and cities still have smaller incomes, hence LUP as a rural marketing concept is not going anywhere any soon. However, urban pockets are seeing an upsurge of two competitive concepts as antithesis to LUP. While their presence and their strength, at this point is minimal, but it can sure not be ignored. I call these –

• Big unit packing (BUP)
• Multi-unit packing (MUP)

A Big unit packing, BUP is a large size packing for the product without any other change. The BUP offers the product in a 2 to 10 times the package size which it is normally offered in. The package dimension and the body copy on the package are adjusted to suite the size while the content remains the same. The pricing of the BUP is almost always kept more attractive for the obvious higher economic, psychological and social risk the manufacturer wants the customer to take by buying the bigger pack. The discount can range from a meager2% to almost 80% in some items. Some product example are  1000 ml shampoo bottle, 2 Kg corn flakes pack, 2.5 liters cold-drink pet bottle, 500 gm butter, 6x100 gm noodle pack etc. (see images)

BUP - Indian  Snacks

BUP - Corn Flakes

A Multi unit packing, MUP is bundling of multiple units of the normal size pack together as an offering, without changing any other attribute of the pack. More often than not the final package is just tied together with an adhesive tape or with temporary adhesive to create a bundle(or simly given out as loose multiple units). The MUPs are not tampered with in terms of per unit pricing but rather offer a free unit (sometimes more than one free unit) when bought as a bundle. Hence, these discounts may range from 20% (for Buy 4 get 1 free) up to 50% (for buy 1 get 1 free), latter generally in case of private brands at (modern retail stores). Obviously, MUPs offer higher per unit discount than BUPs but these are also ridden with controversies. Claims like bundling is resorted to sell products which have reached or about to reach their expiry dates are common. Also, MUPs for some products like soaps, have also come under fire as forced marketing where a customer is deliberately not given an option to buy a single unit. Some examples of MUPs are Buy 3 get 1 free soaps, Buy 3 get 1 free biscuit packs, Buy 2 get 1 free deodorant can etc.

MUP - Bathing Bars

MUP - Fruit Juice

The trends and realities leading to these two new packaging concepts are pretty much opposite of what led to the LUP’s success. These attributes can be segmented under the following heads.

• Consumer

• Higher disposable income with higher spend on food and hygiene categor
• Wants to reduce the physical risk in terms of efforts spent on reaching out to the stores to buy small items, by purchasing in bulk
• Wants to reduce economic risk by getting benefit in terms of per unit reduced price and discounts (& free units in case of MUP) attached to BUPs and MUPs
• Increased brand awareness and brand loyalty creates a favorable perception for bigger brands and companies, leading to reduced perceived health risks and hence higher confidence in buying products in bulk
• Mitigate psychological risk by reducing the frequency of information search and alternative selection process employed during buying cycle (pain of buying something repeatedly)
• 
  
• Companies

• Helps in improving top-line and bottom-line performance
• Lower attached costs like- packaging, logistics & distribution costs, storage & handling costs etc
• More stable revenues and volume predictions and forecasts for planning
• Ensured of higher number of days of product usage without switching. Very important for products that consumers may take time to get used to or for benefits to be visible.
• Bulk size leads to higher per serving consumption, hence leading to increase in purchase frequency per SKU
• Higher visibility of products in the shelves at the stores due to packaging size. Attractive discounts also help in securing additional promotional space within the stores (Eg. Pepsi in the image)
• Reduced pilferage and wastage costs

• Retailers
• Higher volume turnover and revenue generation
• Lower attached costs like- logistics, storage and handling costs, manpower & admin costs etc
• Reduced pilferage and wastage costs at storage and retail point

However, this new wave of opportunity in retailing hasn’t come without its own share of challenges for stakeholders like –

• Cumbersome to manage due to larger space requirement and weight

o   Size/bundling should not be increased to an unmanageable level

• Requires greater per unit investment from the retailer and consumer

o   Strong brand value, channel partnership and higher margins will encourage the retailer to stock BUPs and MUPs

o   Strong brand promise and its credibility and reduced buying risks for customer will influence the customer for purchase

•  Brand value erosion

o   Quality and packaging must not be compromised in BUPs, MUPs must not be encouraged. Cross brand selling with smaller value item is acceptable though (Example, a washing bar cake with 1 kg of washing powder)

• Reference price degradation

o   Consumers process pricing information in many ways, one of them being reference pricing which is based on fair price, last price paid and usual discounted price among other attributes. BUPs and MUPs affect ‘reference price’ in consumer minds for future purchases negatively

Standard Packaging - Patanjali

• Loss of LUP customers

o   LUPs should not be withdrawn from traditional channels and can be used in modern retail as part of cross-sampling with related products

o   LUPs, BUPs and MUPs can together go as greater depth(product variants) in product assortment rather than one substituting the other

 As mentioned earlier LUP is a very strong marketing innovation and is not going to be replaced or withdrawn in near future for economic as well as distribution reasons. Still, BUPs and MUPs are emerging concepts and are much visible in modern retail, while the traditional channel seems to have not been involved in this change to a great extent, for good. How are these concepts developed further by companies and their channel partners; and how are these accepted, ignored or worst, protested against by the consumers, will be an interesting development to watch.

Product Placement/Collaboration - A Journey from Vicarious to Personal Experience

Product Placement is formally defined as - "any form of audio-visual commercial communication consisting of the inclusion of or reference to a product, a service or the trade mark thereof so that it is featured within a programme..". Its about time we change the "..featured within programme" part in that definition, as the product is not placed far away in a movie reel anymore, it is within its actual intended customer's reach, and sometimes literally in his hands!

From FedEx in Cast Away to Coke in Taal and from modern family's apple ipad show to the Safari Storme's presence in the Indian TV series 24, the product placement was pretty much a vicarious experience, with its relevance preserved and communication cascaded through the scene's. The TG not only related with the product through the associated actor and story line, but also the brand message was succinctly absorbed. But the tactic soon started to be overused to an extent that the two essential component for product placement's success, relevance and integration were given a back seat and mindless visibility drove the fad. Soon, more often than not, the placements started to be first ridiculed and then conveniently ignored by the audience.

This trend was slightly arrested by bringing a higher credibility to the product's relevance and its integration with a real-life situation (instead of story line), by taking products a little closer to 'reality'. The wave of product placement in the so-called "Reality Shows" struck and we started seeing bottled beverages consumed by the judges' and motorbikes being ridden by the contestants. Since, the audience generally believed that the reality shows are for real (yes, it did then and it still does!), the products were brought closer to the real target audience with much ease, piggybacking on the credibility and fan-following of judges and contestants of these shows.

Parallel to this, another wave of product placements brought this marketing tactic even closer to its audience by the means of enhancing the 'reality' content to highest level thus far. It must be noted that the product placement in sports has been there for a long time, but never been given so much prominence, as it is been given now. The strongest argument in favour of product placement in sports is that it is as real as it gets (fingers crossed!) and hence the audience is able to relate to the product communication and promise in an empowered way, as the customer attributes the purchase decision to a strong and credible show of trustworthiness by the product/brand through sports ambassadors in a real sporting event.

While, many would have thought that this is as closer as the product placement can get to its customer,  i recently came across two on-field executions  where the product is placed further closer to its target audience(literally in audience's hands!). Relevance and Seamless Integration - the two basic pillars for a successful product placement strategy are excellently preserved.

The first one was Ms Hema Malini promoting "The World's Best RO Purifier"(What?) at 30000 fts, while the very welcomed 'complimentary' paper cup with water (assuming RO purified!) is served (How?) in an Indigo flight (Where?). A simple cup of water served with an ad by an aggressive and innovative water purifier company, in a set-up where everyone has lots of time to notice, watch and analyse (When?), a sweet spot is hit.

The second execution was of mindfully placed 'Tempo' hand sanitizers on each table at a McDonalds restaurant. A beautiful multi-pronged placement strategy -

• Promoting an easy to use hand sanitizer with a pleasant fragrance (What?)
• Invoking hygiene and health concerns when people are about to eat food (When?)
• Making the product available at arm's reach on the same table where the food is placed (Where?)
• Allowing customers to try the product for free (How?)
• Gain customer mind-share, especially with a very dominant player present in the segment

The above two product placement (& collaboration) strategies with their multi-pronged targeting demonstrates a never ending world of opportunities to market product and brands with placement anc collaboration strategies.

Also, these executions open hosts of other avenues for product placements/collaboration well beyond the traditional audio-visual commercial avenues that forms the basis of the widely accepted definition of product placement.

Certainly, the product placement as a marketing strategy has brought the products once marketed by TV actors in the movies and vicariously experienced by the audience, to the very hands of its target customers where the story line is not just real, but is also personal and tha too, to each one!

Cheers,.

EpicFail #StarbucksRaceTogether

A seemingly well intentioned campaign to encourage conversation on 'race' at the starbucks has gone supremely awry.

Why should a benign act of trying to encourage conversation on coffee about a very sensitive but recently battered issue face such backlash? With the benefit of hindsight, the answer is simple - Inability to on-board your internal and external stakeholders, both on emotional as well as practical aspect.


The Baristas who were to set forth the campaign by tagging and encouraging people to write "Race together" on their coffee cups, were never on-boarded. It came across as a irrelevant exercise for them which made their daily job more tiring with no visible change.

This gap also led to a sense of insincerity to flow across, right up to the customers which led to what is explained in the next paragraph, revulsion. Great campaigns can fail if your field team is not convinced about the vision and objective of the campaign. To add, ease and practicality of implementation must be thoroughly planned and demonstrated before pushing the campaign down the chain up to the foot-soldiers, to avoid making it a boo boo.

 Race is a sensitive topic and with the recent flare ups in US on the subject have led to an open yet sometimes an ugly debate with opinions and counter opinions being blasted. While the intention may be absolutely honest, this sudden campaign rubbed the general public the wrong way as it did come out as a marketing gimmick.

As mentioned above, there was no serious attempt to actually diffuse tensions and encourage positive environment. The operational way of tagging #RaceTogether(rather than an emotional effort by the Baristas) made the customers feel that Starbucks is trying to piggy back a sensitive issue for its own marketing advantage.

The campaign is ordered to be halted prematurely.

Lesson learnt the hard way!

Amazon - An Innovation Powerhouse!

An annoying interstitial ad forced me to post it on my facebook page as a sign of protest. It is funny how social network makes you feel as if you are actually powerful. I will save a detailed note on this psychological e-phenomenon for future, but I must say that the ad did what it was supposed to do. Discounting the fact that I didn’t end up buying the colourful bagpacks, the ad did manage to attract my attention. It also made me promote it (unwittingly!) to my 500+ internet buddies on facebook.

 

The brand that was advertising vociferously on my daily news website was Amazon. Huh.

Amazon is everywhere these days. It has slowly and steadily, and with a lot of patience and innovation, built a strong-fundamental based business model in India. Many were wondering for the first few months after Amazon made its way into India about Amazon's quiet game plan. The firework that one would expect from the big daddy of online retail was far from visible.

All this while, Amazon was investing in the foundation stone of this to-be e-tailing giant of India. This has helped Amazon India to build for itself an environment and capability to roll out mind-boggling innovative ideas that has kept its customers delighted and rivals on toes so far.

Amazon demonstrated aptly the approach to build a business in a new market by challenging set rivals and even beat them on their own turf. The long experience in its home country and deep pockets though adds to its advantage, none should be taken away from Amazon for being super agile and incessantly innovative.

I wrote some time back on Amazon’s bipolar approach on improving its delivery performance to enhance customer delight. At one end, Amazon had started experimenting parcel deliveries through drones while on other hand, in India it sealed an alliance with India Post to help it deliver parcels in far-flung areas.

Very recently, Amazon introduced a fresh gust of innovative ideas that varies from category expansion to new services and from vendor empanelment to channel expansion.

Back in US, Amazon turned heads last week by inking a $ 300mn-three years deal with HBO to let Amazon Prime members watch old HBO shows. Within no time after giving its customer the HBO delight, it announced launch of the prima-pantry service for its prime members. The service allowed the prime members to shop from more than 2,000 products to fill a four-cubic foot box with up to 45 pounds of goods. The package can then be shipped at very nominal cost to the customers.

These simple innovations have not only added to the product lines it can sell but have also created benchmark for serviceability and customer responsiveness in this rapidly growing industry.

Here in India, Amazon has opened up a bottle of innovations which, with the gush these innovations are ejecting, seems to have been there ‘under-construction’ for some time now.

After collaborating with India post to deliver its parcels in 19,000 pin-codes across country through its Colosseum -like network of 140,000 Post-offices, Amazon has put into action its plan to make it easy for sellers.

Amazon, this week launched two initiatives for sellers to facilitate an accelerated and hassle-free experience. The US-based firm launched the Self Service Registration (SSR) and Amazon Easy Ship for sellers. Amazon SSR enables sellers irrespective of their size, location and size of catalogue, to self-register on the Amazon marketplace and start selling within a day without any third party intervention, making the process quick, easy and transparent.

With Amazon Easy Ship, the seller has to pack the shipment and confirm to Amazon that they are ready to ship. Amazon Logistics collects the shipment and ensures that the product is delivered to customers in 2-4 days.

Jeff Bezos is known to be the driving force of Amazon's
customer first culture and a true admirer of innovation at work

These two services have taken the e-commerce game to a different level in India. A response from the bigger rivals(so far!) Flipkart and Snapdeal is soon expected as the e-commerce industry matures in terms of technology and operational set-up.

The big question is, how Amazon has been able to pop-out one innovation after other, even faster than the TV soaps’ episode run?

The answer is fairly simple – Getting the basic rights and employing Long-term thinking in a new market.

Amazon didn’t rush to lure customers as soon as it entered in Indian market. Instead, it took its time in getting the fundamentals right. It built the logistics network, warehouses and built up a large selection of products that is now bringing in customers for them.

In a recent interview, Amit Deshpande GM of Amazon India said that its strong back-end infrastructure is helping it scale up fast. He further added on that when they decide on areas of focus, they always work backwards from the customer. Selection, delivery experience, logistics, payments and website experience are areas they are super-focused on.

Amazon has been scintillating in terms of its growth, and more importantly in its systematic business approach in terms of all modules of a business organization – Strategy, Marketing, Supply chain, Human Resource development and above all, Innovation.

Truely, Amazon is an innovation powerhouse!

Amazon @ Seamless Innovation

Amazon’s Octocopter project swept many people e off their feet. It looked like future had arrived. Whether the project and idea is safe and more importantly legal in countries where Amazon would want to take this concept is a topic for a different day, but how revolutionary the idea is in terms of exceeding customer expectations in terms of delivery and service, we will take that into consideration for now. 

   

Marketing is not just about building a brand. It is also about creating a brand promise, communicating this promise to customers and most importantly, fulfilling that promise, time and over again.At a time when there is intense competition between companies to grab a share of consumer consumption, arriving at a brand promise and consistently delivering it is a critical factor for success of any brand and company.

Reliable, quick and hassle-free home-delivery is one such promise that is being made by a lot of companies these days. These companies are from sectors like e-commerce, food-chains, courier & logistics and many more.

With benchmarks for customer service and satisfaction rising due to the availability of alternatives and higher purchasing power, run of the mill ideas for marketing and customer services have started to feel the heat. Whether a company wants to grab its TG's attention or want to delight its customers through its service, innovation has become a game changer.Innovation has become a major factor to differentiate between ordinary and brilliant companies and brand.

Amazon is one such company which has always been know for its innovative approach towards its business.  The recent initiatives taken by Amazon testifies this. One is the much hyped experiment about using drones to deliver products to customers. But the other one is much local and much more viable option which many of us would not have imagined.

When a company demonstrates its futuristic delivery idea, how many of us would imagine that the same company is also roping in an organization tagged as old and slow – India Post, for the same objective- delivery! .  This is a classic example of seamless innovation. This is also something, which most of the organizations have not been able to achieve. When a company goes for all-tech futuristic innovations, it is almost impossible to have eyes open to more traditional avenues to innovate. Amazon did that.

The end objective in both the cases is same but the TG of course changes. The drone delivery would be for achieving quick delivery times and the India post collaboration is to achieve high penetration for the company in terms of customer reach. Not to forget the drone experiment was not done in India or for Indian market though, but the extent of pro-activeness and the efforts to achieve customer delight  is remarkable in the Jeff Bezos led company.

Also, one should note that Amazon's drone delivery experiment is not the first one since Dominoz has done this experiment in June this year already.

   

 But what makes Amazon special is the bandwidth of innovation it allows its employees and teams across globe to create value for their customer. This organizational culture not just enriches its employees with learning but also benefits its customers. Truly inspiring!

Cheers, 

Pranks are good - So says Prankvertisers !

Prankvertising is a hot debate these days in advertising world. The idea to capture your audience with a visceral reaction and emboss an idea/brand/set-up in their mind has always been tempting for the marketers. However, what makes this form of advertising an art and a science both is - how much creativity you can employ into these at one hand and how precise and calculated you should be on the other hand to keep the whole experience interesting and relevant. Most importantly, how clearly and effectively the experience can communicate the intended message to the targeted audience effectively.

     
                                  Prankertising for the movie CARRIE - 500,000 + views in 1 month 

 
Prankvertising is a high-profit-high-loss chip. Right from the point where the idea of creating a prankvertisement is conceived till the point it is in public domain, there are multiple points that can make or break the whole experience for the marketers and audience.

                                    TNT Belgium Launch - 46 million views since Apr 2012

These ideas are top-of-the-roofs idea which are (and should be for the right buzz!) loud and subtle at the same time. They are largely clutter-breaking ads. This is also the sign of a good prankvertisment. It should be loud in the content but subtle in intent. Hence, it should be able to generate top-of-the-mind recall due to its content and must also be able to pass on the message to the audience in a simple yet effective way.

The cost associated with prankvertising is less since these are generally created to be aired on social media or fan page and not on expensive TVC slots.  Generally, these are created with the idea to promote a concept or a product in the public domain and rarely warrants for an action from consumer there and then. Hence once the ad is created it is released in social media which is the most common platform for such initiatives. These campaigns largely rely on social sharing and creating a buzz on the online communities. Word-of-mouth and social sharing hence are the strongest medium for propagating the same.

                           LG IPS Monitors - So Real, Its Scary - 20 million views since Oct 2012

Challenging part in this is the fact that since the reliance on taking the ad and hence the message forward is on audience prerogative. This means that if the content is interesting, the sharing and buzz-creation will work on its own. In case the content is not strong enough, it will be killed at very early stage by the TG and netizens. Hence, the first measure of success for prankvertisers will be the penetration (rate and absolute numbers) for the ad put in public domain.

However, as mentioned earlier, prankvertising is a dual-edged sword. These ads usually catch people out of prior information hence there always is a risk of events taking a turn which was unaccounted for. Sometimes the prank may not go down well with the audience who might feel offended. Such unwarranted events lead to bad publicity which is difficult to shed off.  The more practical problem with such events is that they sometimes become too loud and ignores/misses the second important part of the campaign – pass a message to the audience. Hence, one should be extra cautious while bring in a plan for prankvertising to the table.

Not to forget, sometimes questions are raised on prankvertising about its credibility and authenticity. Many argue that the people who are presented as ignorant passers-by and unsuspecting audience, are usually actors. This takes away the appreciation of the surprise element that the audience is shown to have gone through in the whole experience.Ethical behaviour is another factor that is invoked whenever such ads make rounds. Critics questions the rightfulness of involving people into a video making or campaign/ad without taking their prior permission.

However, on a pure advertisement perspective, It is clear that a well-thought of prankvertising campaign which manages all the macros and micros of planning and execution is a strong clutter-breaking method which also come out as cost-optimized and effective. Keep the prank mode on!

Cheers,