There can be an Easyday store opened in small towns and cities, unlike Best Price

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Some, however are not too optimistic, arguing that cash and carry constitutes a small percentage of India’s total organised retail business. Although it registered a 100% growth in 2008, it needs to be remembered that the operating base of the cash and carry business itself is still small in the country. Raghav Sehgal, Retail Analyst, Angel Broking opines that Bharti’s retail business has the potential to provide that next big leap to Bharti Enterprises, if they focus on their B2C model viz. the Easyday chain of convenience stores and hypermakets. “Every brand is driven by consumption led by the end consumer and B2C model has the potential to reach out to rural markets as well,” agrees Sehgal. And here, there is a lot that Bharti’s retail venture can learn from its telecom stint. Airtel is the market leader in the sector and there were a few primitive requirements that helped it scale this feat – vast reach and coverage, a strong network and price competitiveness. Applying these principles in retailing, the B2C model has the potential to reach out to the mass market. There can be an Easyday store opened in small towns and cities, unlike Best Price. Secondly, Bharti Walmart has invested extensively in its back-end over the last two years. Taking expertise from Walmart, Bharti is sourcing fruits and vegetables directly from farmers in Punjab. “With telecom, they understood the nerve of India and so were able to expand even into the hinterlands. Their retail venture will require them to do the same,” asserts Wadhwa of SKI Capital. Moreover, managers at Bharti are already in sync with retailer psyche (thanks to Airtel) and they can play on that. Crucial perhaps is the slow but sure manner in which Bharti is going about its retail ambitions. Organised retail is a political potboiler in India. Mukesh Ambani’s experience with retail shows the level of resistance that can be evoked with the merest whisper. No wonder Bharti has only 27 stores operating till date - a majority of them in Punjab and Haryana. Unlike Ambani, his strategy seems to be to acquire critical mass and then flex muscles. Mittal surely knows how to learn from the mistakes of others, especially the ‘big boys’ of India Inc.

But here’s the most pertinant reason why Bharti-Walmart has the potential to become the number one player in its segment. It’s the incredibly potent combination of Walmart and Bharti stupid! With annual revenues of $405 billion, Walmart is the most successful retail business in the world and the Walton family dwarfs even Bill Gates in terms of personal wealth. Their well-oiled retail business operational skills are stuff of global legend now. Sunil Mittal and his brothers on the other hand have already shown proof (with Airtel) of their acumen for succeeding in sunrise businesses. If anyone can work magic in the sector - apart from Mukesh Ambani of course - it is this combine. “Bharti group is known for its scale and all its business ventures have the ability to become cash cows. Given the nature of partnership, the chances of success of the ventures are much higher,” agrees Jagannadham Thunuguntla, Equity Head, SMC Capitals. Even the Mittals are banking heavily on at least one or more of these businesses to firefight its way to the top. They’ve tasted success once and are not happy remaining a one trick horse anymore. Their diversification strategy seems set to reap results - at least in the organised retail biz. Ready to usher in India’s next home grown conglomerate then?

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Would you ‘yamakasi’ for Thums Up?

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Brand: Thums Up
Agency: Leo Burnett

Well, Akshay yamakasi’ed in the Taste the Thunder campaign for a bottle of Thums Up in 2007 and the brand is tasting its success with over 16% market share in sales (AcNielsen report) till now. This Khiladi lad re-inforced the attributes of Thums Up and quite impressively. Anand Halve, Co-founder, Chlorophyll, “The proof of this campaigns’ effectiveness is that this brand has fought two of the most reputed brands in the world - Coke and Pepsi - and beaten them!” Burp, Burp...

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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S. BANDYOPADHYAY, MD, RELIANCE MONEY

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1. SBI’s ‘Taaki bachpan ke beech kabhi budapa na aaye’ campaign
2. Max New York Life’s ‘Karo zyada ka irada’
3. ‘Yeh hai youngistaan meri jaan’ from Pepsi
4. Coke’s ‘Little drops of joy’ was a delight
5. Indiabulls’ ‘Creating a world of smart investors’ campaign

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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So what do you say Mr...

IIPM only B-school in India to be Ranked Ahead of The IIMs in so Many Parameters! Regularly!

4Ps B&M: How has been the last year in terms of financials?
TF: Sony India during FY’08 for first three quarters (April- December 08) has realised actual sales of around Rs.28.3 bn which is a 25% growth from corresponding period in the previous period. However though Q4 (January–March’09) growth is expected to indicate a minor slowdown, we estimate that we can continue to maintain over 20% growth for the total FY’08 compared to last year.

4Ps B&M: How much is the size of CAV market in India and how do you plan to increase your share of the matket?
TF: Consumer Audio Visual (CAV) market in India is around Rs. 125 bn of which Sony has a market share of 18%. And overall trend in the industry has indicated a 10% growth till FY‘08 so we are quite optimistic about the same this year too.

4Ps B&M: Sony has been in India for a long period of time. But you didn’t have a brand ambassador for your products. Are there any plans in this regard?
TF: Globally we have a brand ambassador. But in India we think that we don’t need a brand ambassador for our products. Moreover, this is our strategy to differentiate from others.

4Ps B&M: What is the potential that you see in India in terms of growth?
TF: Indian economy is domestic demand driven economy. Thus saving ratio is higher than other countries. Moreover, the dependency on installment (consumer finance schemes) is also lower than other countries. Thus we see a great potential in terms of growth in future.

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
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The world does not end in one quarter...

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4Ps B&M: Slowdown impact?
Slowdown impact has been there and more in recent times. Input costs have gone up over the last two years. We had to increase MRPs as there was significant inflation across the board. However, at the same time, we concentrated on delivering better quality competitively. So price change was not just a commercial decision, but a combination of handling costs and increasing consumer value. There could have been an impact on our volumes, but then the world does not end in one quarter.

4Ps B&M: What is your take on competition?
Britannia is comparatively in a stronger position in the biscuit market and is the market leader. We feel confident that we will be able to take on any challenge. We have healthy respect for competition. For us, the key criteria is to increase our market share.

4Ps B&M: Which strategies find Britannia in a good stead?
Over the least few years, a lot of effort has been put in strengthening our brands, in terms of USP, advertising, product mix, packaging, et al. Therefore, we have a robust and healthy all round growth. We chased consumption opportunities everywhere and increased our tonnage by 15-20% yoy. We also made significant changes in our ‘go-to-market’ strategy.

4Ps B&M: Some say that you are not aggressive with new launches?
The only new category in the biscuit space in last one year was nutritional biscuits – NutriChoice launched by us. There were no other product launches. We’ve certainly done more than competition but yes, we’d like to do more.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM Profile.
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