I am Satyen Shivananda Poojary from NMIMS Executive MBA Course Marketing division B.
Currently I am working with ICICI Bank limited, for the most-beloved products of all “Credit Cards” (so much for the sarcasm)
It’s been quite some time since I have been actually using this combination of “thinking & writing” simultaneously. Perhaps it was in my junior college where this part of my brain last got its exercise. In fact back then a lot of my writings had been put up on the school\college notice boards or shared by the faculties to their class as an innovative idea.
Sadly but this is more of history now, my skills with words have taken a beating. Adding more to it, thanks to the so called SMS culture my spellings have got affected. How can I let go the habit of letting Microsoft proof read\spell check & auto correct my mails\memo’s etc. This combined with all those extra words, slangs, & abbreviations that the internet community & the IM culture has added, IMHO if 5h@k35p3@r ws arnd he mustav got owned!
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^ Right above that line was history, & from hereon I would write about my present & built up on the future.
As one of my dear friends say it, “I don’t worry for my past ask I did wrote it, & neither do I worry about the future as it’s I who am going to write it” J
This journal is going to be an honest attempt from me to not only recap on what I gained in the lecture, but also to revive what I lost in skill sets.
May be somewhere down the line, incase I loose direction this would also act as a reminder to what I promised, it to myself.
Or atleast be good fun on reflecting how it all started…..
Day 1 of the lecture:
After a lot of brain storming we collectively defined the term of “Market”
“Market is a Medium, whereby potential buyers & sellers interact and get exposed to product, services & ideas with intent to buy”
There was a point at where an argument started “Can seller not be aware of what he sells?” this although now sounds as a ridiculous statement but it lead us to a thought of prospect sellers.
These are the ones who are not selling anything (yet) but are getting ideas & buying thoughts. They are waiting for the right time, the right price to enter into the market.
A very classy example that I can relate to is, about the recent events of Bajaj Auto Vs the Hero Honda group on “Who would be the first to bring out
It started at January 2006 in The Delhi Auto Expo Show.
Bajaj Auto came up with a couple of new aged bikes.
On the limelight was this new variant of Pulsar, the DTSFI Pulsar. DTSFI is short for Digital Twin Spark Fuel Injection.
The bike took all the limelight as this was supposedly a 225-250 CC bike with around 24-27 BHP. This got all hardcore-quality-deprived-bikers (like me) all excited.
Every body wanted to see what other manufacturers up their sleeves.
Next up was Yamaha Motors India’s stable, they had two new foreign bikes on display The 250 CC Fazer, & the 200CC Gladiator. They boasted about getting this to
And oh yes to drool upon there was a display of Valentino Rossis, Go!!!!!!! Machine… the MotoGP Yamaha, also popularized as the 1.5 crore bike in the expo.
TVS had some interesting prototypes, Suzuki skipped the show.
Last were the Hero Honda, which had a couple of units of every Bike they already manufactured, nothing new, no news no huge claims…. What a let down! Enthusiasts like me were expecting a baby CBR or an Upped version of the Karizma.
All we got was just disappointment.
What happened next is truly amazing…. From all this time from January to June Bajaj kept boasting about the Pulsar DTSFI & how it would be a breakthrough & blah blah blah. One fine day Bajaj made the announcement of their idea of patenting it for Smaller bikes. This backed by a strong statement that the FI Bike would be open for orders by November. This event was perfectly timed with mass celebrations of Bajaj achieving some x number of sales.
The Next day Hero Honda announced that It’s already ready with
What HH did was precisely wait….. They found and allowed Bajaj to grow the enthusiasm of people for such a bike
Once the market was ready for such a bike & then wham! They killed an unborn product hands down.
It’s a different story that the Glamour as a product is an utter failure meanwhile Bajaj is still adding frills to its machines
Another important thing that we learnt was a very interesting snapshot about the Life cycle of a product.
What hit me the most was the interesting triangle structure of Habits, Demography & Technology!
In fact this triangle can be applied to almost all of management fundas.
I always believed Life is all about choices and taking decisions, now I can add to it that its ‘marketing’ that compels you to make a decision.
It is this trio of HDT( Habits-Demography-Technology) that guides you to a decision.
I would be lying to myself if I said I was not “aware” of this concept!
After all I work for
Have tried to given a few insights on how we target our customer base.
Demographic info from CIA.gov
The median age here highlights the YUPPIES kind of a mix, which as a Bank selling cards is quite interesting.
I used the word “Interesting” because it not only brings spends along with it, but also problems of delinquency\credit risk too.
Infact this mix of the market consist of fast earners-fast burners of money. For this kind of people just an attractive marketing promotion would work wonders. Promotions like 5% Cash Back, Express Reward points, Happy Shopping hours usually cater to this segment. These are like spark plugs to ignite the flame for buying!
The other kind of the mix constitutes people who tend to spend within there limits & means. These guys however have good balances in their bank accounts.
This is more often thanks to control way of upbringing which has trained them not to (over) spend. Such customers are a bit difficult to convince.
However it’s not impossible, the new Swipe-n-Smile which has an USP of Buy Now pay in three months is targeted to this segment.
This is not only a tool to extract more of moolah from them, but also a tool for altering his habit and making him spend more.
Another interesting product which has allowed people to actually adjust their habit was the “Online card”
This product has not only assured people of safety on Net for transacting by backing the product with Pre defined limit & a unique Insurance cover, but has also meant that we have 1) Multiplier effect in card issuing numbers 2) Risk dissemination on other products. 3) And more importantly that sense of Safety & security has actually made them spend more.
Concepts of Marketing with the aid of the 4E’s i.e. Enlist, Engage, Empower, & Enslave & the AIDA Attention-Interest-Desire-Action were also discussed.
And last we summarized by agreeing upon “marketers take us for a ride & we willingly fall over this gamut of marketing”
Day 2 of the lecture
The Strategic Orbit Concept:
After a long time learnt about astronomy!
Here we see an orbit of different diverse functions, which in spite of being diverse, works around the Core Business Function.
If diversification at my bank didn’t exist then in a way it would had never grown from being just a bank that was institutionalized for providing Industrial Credit to one of the biggest private sector banks today.
A few people know that ICICI is no longer an acronym to Industrial Credit & Investment Corporation of India, the word as of now just means the Brand Name “ICICI”.
This brand originally offered banking solution under the name ICICI Capital & had a few liabilities products under the name ICICI PFS. Post merger they formed a huge entity Namely “ICICI”. Of course we still have a complete out sourcing company in the form of ICICI One Source & a technology consultancy service, namely 3i Infotech (previously ICICI infotech)
It is this though process of diversifying into different arena all together but still remaining at its core USP is what differentiated an ICICI from an SBI or an IDBI.
We also learned about the “Mosquito Theory!”
It was interesting to know management concepts from these pesky little mosquitoes. Like Mosquitoes these competitors enter the market almost silently, without drawing any attention, if required they can irritate the giants of the market (read Elephants) and can even kill them.
These Elephants can trample virtually anyone in the market, but then again is also “aware” that this competition cannot harm you, unless you harm yourself.
A very interesting flashback was the story of the how 25 years back tiny Microsoft sold on and around IBM. In fact one of the first products managed to sold by Microsoft was written by one of IBM’s employee & was named QDOS (Quick & Dirty Operating System ). This system with very few modifications was renamed Ms-Dos & was sold to IBM.
Now calling Microsoft a mosquito would be inviting trouble. And ironically IBM is no longer the Elephant it used to be.
Interestingly in my domain too, Deutsche Bank is just about to launch its range of Credit Cards in
DB has also done their homework well. They have recruited the best of the talents from the existing banks in
Secondly they are targeting their products with interesting cross sell products. What I hear from an inside-news is they would be launching this product with a 6 months 0% balance transfer scheme. This effectively means that, although I am starting the business late, my first bite into the market would mean eating away a major chunk from other bank customer portfolios 6 months spends.
DB don’t worry we are ready for you J (& incase you are reading this & happen to be a part of DB HR then I am ready to switch too)
Environmental Scanning
The Boston Consultancy Group Matrix.
The BCG Matrix, says that when new product is launched, It is assumed to hit at the High Growing market. Since this product is a new product it has a low market share. These types of the products is called as the “Question Mark products”
Question marks as we don’t know where it would move on! An example would be Hero Honda launching a semi liter class bike in
Currently since there are hardly any products in this segment, the share of the market is low & the growth rate is perceived to be high!
The next in the chart is a star product, i.e. a product where my Market Share is High & the Growth is also high. An example here would be the economy class 100CC motorbikes like “CD100 or CD DAWN” or perhaps even “Splendor”
The scope for growth in this segment is almost upto saturation. Almost every manufacturer has now a 125+ CC Bike which it is putting forward as its entry level range. As far as market share is concerned of every 10 100CC bikes at least 7 would be from Hero Honda, so a very high share in this segment.
Last in this chart are the “Dogs”, these are the products which have reached the stage of Decline in a Product life cycle
The Product Life Cycle
From this stage of decline, the product can either exit the market or go back to the ‘Design Board’ for a revamp to propel a new Growth or revival.
Also very important note! The chart events may not occur in the same order. For Eg.: In the first example of a sub liter class bike being launched, It is very likely that the our very protective government, with its very protective ‘roads’ might shoot the plans down.
Better still this is where the 5 forces model would help in better understanding how this product might move.
Power of Suppliers:
Since Hero Honda is a power enough brand with a very established sales & service network they enjoy high power here.
Power of Substitutes:
Since the product is a high end product as compared to other available products in the existing bike markets. The power of substitutes is low as we have hardly any products in that segment leave aside calling them substitutes.
Power of Buyers:
The Power of Buyers is also low here due to low options available. Also it depends on the pricing that Hero Honda uses. If HH prices it product a too high then potential buyers would have an option of getting imported bikes its only the service part that would cause a concern to them. Thus giving them some powers.
If the product is fairly priced (which is very unlikely for HH) then the buyers power is very much negated.
Power of New Entrants:
This is where the game lies! There are a lot of wannabes like Bajaj waiting for getting into such high capacity bikes. There are established players like Yamaha, Suzuki, Kawasaki & Honda who are experts in such products in the world market. There are other niche segments like Harley Davidson & the Yamaha international wanting to get liter class (1000 CC+) wanting to get their tourers into our market.
There is another aspect to this especially the reason why I chose this example, presently Hero Honda is a technology venture between Honda Motors & Hero Cycles. Also most Indian bike companies have the same concept, TVS+ Suzuki , Bajaj +
Would require some help here in understanding this further!
1 comment:
Abey aise posts karke duniya ko sulana hai kya? :D
j/k
Welcome to the blogging world bro.
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