Archive for October, 2012
I often wonder about the longevity of watches as a category and whether they will eventually suffer the same fate as the humble typewriter, either in a few years or a few decades. Two close friends of mine have already stopped wearing a watch on a regular basis – their logic is that they carry a phone all the time and can see the time on their phone. What’s worse – for the global watch industry, that is – they find the watch doubly redundant when at their desk in office where they can also see the time on their laptop.
Undoubtedly, the trend towards wearing a watch as an accessory will extend the category’s life-span, but for how long ? And does the watch industry have any other tricks up its sleeve or will it fall prey to marketing myopia in a decade or two ?
[Note : We’d mentioned marketing myopia once in an earlier post; the subject of this post is somewhat similar - an attempt made by a firm to adapt to a changing market, though in this case it's early days yet and the market verdict is not clear.
Marketing Myopia : The term refers to the short-sightedness that leads companies to focus on their own organisation and product – line rather than on customers’ needs and wants. It leads to reluctance to change, and a failure to adjust to a changing market environment.]
In this context, I felt that the launch of the Tag Heuer Smartphones by the luxury watch brand was an interesting experiment (you can read articles about the launch here, here , here and here). Tag Heuer started retailing luxury mobile phones in India from 2008. It has since launched three such devices – first the Tag Heuer Meridiist and Link, and recently the Racer. The Tag Heuer Racer Smartphone (pics on extreme right in the image above) was the one launched a few months ago; in keeping with the Tag image, the phone looks top-end – really sleek, it’s supposedly styled after race cars. Buyers can customize their phones’ cases in a variety of materials, from rose gold to titanium, just as they would a TAG watch. They can even add Calfskin-leather trim, or a sprinkling of diamonds, for good measure.
One fly in the ointment could be the fact that while consumers buy a watch for a lifetime – or at least to last for many years, they tend to change their phones to the latest model fairly often; at the price tag of a Tag Smartphone, that’s a bit heavy on the pocket. Will be interesting to see how this pans out. Meanwhile, kudos to Tag for not burying their heads in the sand, trying to adapt to changing consumer habits and being bold enough to experiment. A good effort, for sure.
- Zenobia Driver
Adding to that series is this post on the experience of shopping for mid-segment cars. A few months ago, my husband and I were in the market for a mid-segment car, more specifically a sedan, with automatic transmission, ample legroom in the rear and boot space. Our consideration set consisted of Honda, Volkswagen, Skoda, Nissan, Toyota and Ford. We are both car enthusiasts and had done our research prior to visiting these dealerships for further information on the cars and test drives; not only this, through our conversations with the sales persons we’d made it amply clear that we knew about what we were looking for in the car and that we already knew a fair bit about the cars themselves.
Given below is a summary of our experience at various dealerships :
- Knowledgeable staff, understood what we were looking for and told us exactly about that, weren’t gimmicky or trying to sell us anything we did not care for in our car.
- Not only was the sales person prompt in attending to us, but when we needed assistance or needed questions answered by the accessories or finance person at the store, they were quite prompt in showing us seat cover options, color options, or different EMI plans, etc.
- Ample waiting space and engaging reading material at the showroom.
- While the first interaction was impressive, the same cannot be said for the follow-up conversations, where we had to end up waiting for longer, cars weren’t ready for test driving, the formalities for the test drive took longer than expected. Finally when we decided to go ahead with the car, the payment formalities took too long, the car registration personnel were not professional, in the meantime the prices got revised and there was no communication for the same and eventually they did not even deliver in the stipulated time period.
Not-so-good: a few examples of what we didn’t like at other dealerships
- Despite prior appointments with a specific sales person, the person was either out for another meeting or was on leave on that day.
- Some sales persons did not know their cars at all. For simple questions, they needed to refer to the brochure or call their manager to answer our queries. Similarly their accessories and finance teams weren’t prompt with answering our questions either.
- Despite taking prior appointments, the test drive cars were either out for another test drive or were still being prepped for the test drive.
- Did not have ample seating space in the showrooms, so we were kept standing and waiting to be assisted.
- Did not understand us, their customer, at all. In some cases, they did not really talk about the features of the car, instead demonstrated things like how to take the driver seat back and forth, how to turn on the AC and audio system, etc. Now if they understood us, they’d have also understood that we weren’t first time car owners and did not need to be shown such obvious things. In the bargain, they did not focus on the more important or uncommon aspects like fuel economy or sports gear or valet lock feature or parking sensors, etc.
- One of the companies called us up with a new deal everyday!
- Called up everyday to find out if we’d reached a decision despite making it amply clear that we’d get back to them the following week (‘cause we still had other cars to check out). Sometimes we got multiple calls in a day from different car/ accessories sales staff to ask the same questions.
Our verdict: Overall, a C. Major scope for improvement. While speaking to a lot of the sales representatives also realized that the attrition rate in the industry seems quite high; as only 1 out of the 6 sales people we interacted with had been with their company for over a year, rest had been employed with the firm for only 4-6 months.
- Roshni Jhaveri
[Disclaimer: This post deals mainly with one aspect of the shopping experience – interactions with the sales staff. Also, the list of outlets visited for the purpose of observation is not exhaustive.]
(Continued from last week’s post)
Mahesh’ employers were really intrigued with this riddle and decided that there had to be a solution out there – after all, this was a situation faced by many people in the same income band as Mahesh. They decided to do a little research of their own and understand the solutions adopted by others – spoke to their maids, the neighbour’s maids, a few colleague’s drivers etc., they also spoke to a jeweler that they knew. They finally came up with a few interesting solutions.
The first suggestion was that Mahesh invest in a gold coin with a small hook on top, one that could be used as the second pendant on any necklace. This would solve the usability problem and ensure that it could be used as jewelry on social occasions. Mahesh’ wife shot down this idea though – she’d seen her mother and grandmother wear such pendants, and felt that such jewelry would look old-fashioned and signal that they lacked the money for buying a prettier pendant.
The second solution, suggested after much research and discussion, was to invest in buying a thin plain gold bangle. As they found out, the least amount of gold is wasted during making a plain gold bangle and the labour charges / making charges are proportionately lower than that for other forms of jewelry, hence the price charged is mostly the price of the gold. Thus you get good value for the money you pay, and the bangle is a piece of jewelry that can be proudly worn at social occasions, multiple bangles neither detract from beauty nor from social status. Also, if you decide to remake a plain gold bangle at a later stage, you don’t lose much since making charges were low and most of the value of the gold is retained.
While this solution sounded attractive, they realized that it was workable only for a much higher income group. With Mahesh’ savings, a gold bangle that he could afford would be such a thin strand of gold that it would not retain its shape and would get deformed easily, and then it’s utility as jewelry would drop drastically. So that sounded the death knell for the gold bangle option.
A solution was finally discovered via Suganthi, a neighbour’s maid. Suganthi’s household income was the same as that of Mahesh, and Suganthi’s family lived in a chawl quite close to the one in which Mahesh lived. Every year, Suganthi bought a 1 gm plain gold ring from a small jeweler nearby – the ring was small and affordable, and could be used as jewelry. After buying such rings for a few years, Suganthi would return to the same jeweler and use the rings to get a pair of bangles or some other jewelry made. She had no worries about the purity of the gold in the rings as she would be returning to the same jeweler to get the bangles made.
Viola ! A neat solution indeed.
- Zenobia Driver
A friend’s driver, let’s call him Mahesh, was thinking seriously about how to invest his limited monthly savings wisely. Among the options he was considering were fixed deposits in banks, savings deposits in banks, a local chit fund, an insurance policy, and like all Indians, purchase of gold. He was quite firm that at least a part of his savings, if not most of it, would go into buying gold each year; he had a young daughter and was already thinking ahead to her marriage and the jewelry required, plus he knew that gold prices only went up over time and it was a good safeguard against inflation. His parents, his neighbours, his friends, all said so, and community wisdom accumulated over several years couldn’t be wrong.
As Dhanteras was approaching, he’d started thinking seriously of purchasing some gold this year. He had some concerns about buying gold though, primary among these the fear of being cheated on the promised gold quality by the shop he bought it from. For this reason, his wife and he had both spoken to neighbours and family members that had bought jewelry over the last few years to find out which jewelry shops could be trusted.
Secondly, he didn’t want to buy jewelry that would be out of fashion when his precious daughter grew up and have to be melted down and remade with all the attendant tension of low quality gold – or worse still, copper – being added to it. To add to these, gold necklaces were not cheap and he wasn’t sure that even his annual savings would add up to one. Most of the jewelry shops that allowed a customer to pay for jewelry in monthly installments offered schemes of 3-6 months, wherein the monthly EMI would be Rs. 1000-Rs. 1500 for just simple earrings, even this was too much for him to bear.
Stuck in a quandary, he decided to discuss this matter with his employers – perhaps he was even hoping for a small loan in addition to their advice. His employers felt that the chit fund option was the worst among those that he was considering and wanted to ensure that he stayed away from that; they understood his hunger for gold and all it represented – a hedge against inflation, a signifier of status, prosperity etc. They were against giving him a loan too often; finally they mentioned to him the option of buying gold coins; he could buy a coin of whatever weight suited his budget, 2gm, 5 gm, 10 gm etc. If he bought ones with the BIS stamp on them, he could be assured of quality. And they’d appreciate in price like gold jewelry, could be sold or pawned in emergencies if need be, and could be melted down to make jewelry for his daughter when the appropriate time came. They were quite sure that this would be a good solution to his dilemma. But little did they know the intricacies of human behavior and all the attitudes, beliefs, and environmental factors – often tangential ones – that influence it.
Though this seemed a solution to his problems, he baulked at the idea.
“I will buy gold coins once I’ve bought enough jewelry; kuchh pehenne ke liye bhi hona chahiye naa (there should be something to wear too)”
To him the utility of gold coins was much lower than that of gold jewelry, as jewelry could be worn by his wife and daughter at various social functions over the years and hence had a utility value – in terms of adornment as well as signaling status – and an investment value. And he couldn’t think of what to do with the gold coins until it was time to sell them or melt them and remake into jewelry ? And wasn’t the latter a huge headache that was better avoided ?
How did his employers help him find a solution to his problems ? And they did find a really neat solution – one that addressed all his concerns and was affordable. We’ll reveal their solution to you next week; until then, do let us know if you have any thoughts or ideas that we could pass on to Mahesh.
- Zenobia Driver