Posts filed under ‘Observations’

Beauty ‘saaluns’ in villages – a sign of change

A few months ago, during a CREAM (Certificate in Rural Enterprise Administration and Management) training session for micro-entrepreneurs in rural Bihar, we enquired about the professions of each. Turned out that each of the three women taking the course aced at multi-tasking ; apart from managing the house, each held down two other occupations. My first reaction was amazement at the amount of work that they packed into their day, but later I was struck by the fact that two out of these three women ran beauty parlours (or as they pronounced it, ‘saaluns’) out of their homes.

We asked these ladies which treatments their customers went in for and it was more than just hair-cuts – facial, eye-brow threading etc. In villages in Bihar ! So beauty consciousness is increasing not just in urban India, but in rural India too.

This article from the Mint also mentions this trend, albeit in passing. This article, from the Mint again quotes Mr. C.K.Ranganathan, Chairman and Managing Director of CavinKare, “The rural consumer has become more beauty conscious and is willing to spend more on personal grooming.”

Wonder which are the companies benefiting from this trend ? and whether they are using these ladies who run beauty parlours from their homes as influencers ?

We’ll try to dig deeper into this topic with time, so keep visiting this blog for more information on the topic.

  • Zenobia Driver
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February 11, 2014 at 10:32 am Leave a comment

Consumption and the Super Rich

In our last post, we established the context for our exploration into the lives of the super-rich. We saw just how wealthy the 1% at the top is in comparison to the rest of the world’s population. In this post, we shall try and decode their consumption habits and gain deeper insight into the mind of the luxury shopper.

A survey conducted by Prince and Associates in association with Elite Traveller Magazine, which is popular among private jet travellers uncovered these spending habits of the Jet setting elite:

  • 89% purchase fine jewelry per year, spending an average of $248,000 (INR 1.24 Cr.)
  • 32% purchase luxury watches per year, spending an average of $147,000 (INR 73.5 Lakh)
  • 90% purchase fashion/accessories per year, spending an average of $117,000 (INR 58.5 Lakh)
  • 65% stay in a hotel/resort for leisure per year, spending an average of $157,000 (INR 78.5 Lakh)
  • 73% use a hotel/resort for a meeting or event per year, spending an average of $224,000 (INR 1.12 Cr.)
  • 59% stay at a spa per year, spending an average of $107,000 (INR 53.5 Lakh)
  • 21% take a cruise per year, spending an average of $138,000 (INR 69 Lakh)
  • 17% take an experiential trip per year, spending an average of $98,000 (INR 49 Lakh)
  • 75% make home improvements per year, spending an average of $542,000 (INR 2.71 Cr.)
  • 85% purchase wine or spirits per year, spending an average of $29,000 (INR 14.5 Lakh)
  • 30% purchase fine art per year, spending an average of $1,746,000 (INR 8.73 Cr.)
  • They own/lease 4.4 luxury vehicles currently and 85% are planning to acquire a new vehicle in the next 24 months
  • They own 2.5 primary homes valued at $2 million + (> INR 10 Cr.)

Thus, these people spend considerable amounts of money on things others might consider luxurious. If you thought only the Americans and Europeans were crazy about luxury, the super-rich in Asia are also quickly getting up to speed with the west. Japan has long been one of the biggest markets for luxury goods in the world, and India and China are fast catching up thanks largely to growing economies and young populations with large expendable incomes.

However, it’s not just the amount of money they spend, but the manner in which they spend it that suggests the lengths this segment is willing to go to in order to satisfy their desire to consume.

Consider, for example these shopping behaviors exhibited by some of India’s super rich and reported by the Economic Times :

  • Shahnaz Husain, Cosmetics Diva, has a Louis Vuitton collection in her wardrobe—not crafted at any factory of the French fashion giant, but at her bungalow in South Delhi, designed by herself and stitched by an in-house tailor. She always buys LV Bags in pairs: One to be used as a bag and one to be cut up and shredded for use by her tailor.
  • Diljeet Titus, one of Delhi’s top lawyers, has bought 40 handsets of luxury phone brand Vertu in the last couple of years. Vertu phones in India cost between INR 3 lakh and INR 66 lakh. Titus also loves to splurge on luxury watches, suits, phones and vintage cars for himself.
  • A lady in Delhi sent 3 specially imported Hermes Birkins worth INR 60 Lakhs to a family friend whose daughter’s wedding she was unable to attend. She also sent an apology note.

This is not just a Delhi phenomenon, although Delhi is fast establishing itself as the nation’s luxury capital. The Delhi stores of most luxury brands with a presence in India are their best performing stores in the country today and cities like Bombay and Bangalore are only just catching up. As far as luxury malls are concerned, Delhi’s Emporio, Mumbai’s Palladium and Bangalore’s UB City are the most preferred destinations for luxury brands seeking to open in the country.

mall interiors

Data gathered from one of the world’s top apparel brands with operations across India suggests that approximately 55% of all revenues come from a small portion of the total customer base (~10%) and spending is concentrated even further amongst the top 1%.

Interesting anecdotes from those in the industry bear this out. One customer, for example, a rich businessman from the Mumbai area spends approximately 2 million INR annually at just 1 store of a brand selling premium casual wear, in addition to shopping at the brand’s stores in Thailand, London and at other locations across Europe. Another customer in a different city once deposited approximately 1 million INR at a certain luxury brand’s store in cash! He said it was too inconvenient for him to carry cash around every time he had to buy something. Even more surprising, he used up his store credit within 90 days.

A 2008 research amongst affluent households (Household Income >$100K) and Super-Rich Households (>$250 K) also provides keen insight on the media consumption habits of the Super Rich, as compared to the affluent. The richer one gets, the more time one tends to spend reading and surfing the web, versus time spent watching TV and listening to radio.

Thus, the super-rich individual today is:

  • A big spender on luxury products and experiences
  • An eccentric and a stickler for personalization, both in experience and in product
  • A global traveller, in tune with the latest luxury trends around the globe
  • An avid reader and a digital native

The Super Rich Customer’s wallet is the Holy Grail most luxury marketers are after and the quest isn’t an easy one. “What do you sell to someone who has it all?” is the question most are trying to answer. In the next post, we shall take a look at what Luxury and Premium Brands the world over are doing to serve this ‘Over served’ segment.

  •   Rahul Sharma

December 24, 2013 at 5:27 am 3 comments

Reactions to Chipotle’s ‘Scarecrow’ ad

The recent ‘scarecrow’ ad by Chipotle Mexican Grill has such a superb music score that anyone who catches even a bit of it notices it and wants more. The entire ad, in fact, stands out as a really well-made short film. It even has – ooops, seems to have – a clear message. But whether that is the right message or the one that the firm wanted to convey is debatable.

[Before I go any further, let me give a bit of background about Chipotle.

Chipotle Mexican Grill, Inc. and its subsidiaries (Chipotle) operate restaurants throughout the United States, as well as two restaurants in Toronto, Canada and two in London, England. As of December 2011, Chipotle operated 1,230 restaurants. The Company’s restaurants serve a menu of burritos, tacos, burrito bowls (a burrito without the tortilla) and salads.

Chipotle encourages sustainable farming methods (turning animals out to pasture) over battery farming.  A major selling point for the fast-food chain has been the fresh and sustainably grown ingredients, including pork and beef, in its burritos and tacos. To an extent, Chipotle’s commercials mirror Chipotle’s own story as they began moving away from using factory farm suppliers 10 or so years ago. Chipotle believed it had the right message already in its emphasis on more natural food; the company had shifted to more naturally grown produce and to beef, pork and chicken produced without antibiotics.  ]

The current commercial takes attempts to take swipes at giant companies that treat food like another product to process and contrasts that with food made in sustainable ways that is fresh and wholesome. However, the ad is a bit confusing, misleading even ; while Chipotle intended to send out the message that they don’t use battery-farmed meat, the ad makes it seem like a vegetarian chain almost.

Also, if you don’t already know what Chipotle is, you’re still left wondering at the end of the ad – it doesn’t even mention the name of the chain prominently in any frame. It can be added to the list of ads that could work for a whole bunch of products – from organics to farming to vegetarianism or to a combination of these ; maybe a good ad for Wholefoods or Trader Joe’s, not for a Mexican chain.

In terms of atmosphere, this ad also had a slightly haunting quality, unlike the earlier ad which was far more cheerful. Makes one slightly uncomfortable, which is probably not the mood you want to be in when you’re trying to decide on a place to eat.

 

To sum up : As a short film – beautiful. As an ad – doesn’t quite cut it.

 

In case you found the post interesting, you can read more about the ads by clicking on the links below :

NYT article about their first ad 

Articles about the recent ‘scarecrow ad’, here, here and here.

  • Escape Velocity team and friends

October 9, 2013 at 2:39 pm 6 comments

Desh mera rangrez hai babu

A few months ago, I was one of the faculty at a programme that imparts training in the basics of business to micro-entrepreneurs from rural areas (CREAM training programmes run by Tree Society). The audience comprised villagers running simple businesses such as a cycle repair shop, furniture making, honey collection and selling, beauty salon (or, as they pronounced it,‘saalun’), barber shops, a wedding decorator, etc. Most of them were between 20 to 30 years old, all but 3 were men.

During one session, we were trying to illustrate the importance of adding product / service features that consumers value the most rather than others, given the ever-present constraints of cost and resources. We’d made our point using several simple examples and the audience seemed to have grasped it too, however they seemed slightly somnolent after a heavy lunch and we wanted to wake them up with before we began the next topic which was math-heavy.

So we decided to use an example of a product that was ubiquitous even in villages and used by everyone, that was feature-heavy, and from a category where the fortunes of companies selling the product had gone through ups and downs. One product fit the bill – a mobile phone. We began by asking the audience to tell us what features they wanted in a mobile phone, and which of those were must-haves and which were nice-to-have. Internet and multimedia were amongst the first few mentioned by the audience, followed by aspects related to how long the phone would last – sturdiness, a warranty, good battery strength etc. Basic features such as call quality, sms etc. were mentioned much later, almost as an afterthought.

What almost every person below 30 in that audience wanted was to be able to access songs and video on his mobile phone; even if they didn’t know how to download them, they knew that they wanted to be able to store and listen to them or watch them. Many didn’t really know exactly what internet and multimedia meant, but they did know that such phones guaranteed them access to songs, clips, pictures and games. Many of these young men already had cheap smartphones, those that didn’t were quite clear that affordability was the only reason for not buying one. In hindsight, maybe I should have expected this given the lack of entertainment options in a village, and that a lot of these people ran businesses where they spent significant amounts of time just waiting for customers to visit their outlet.

This article from the Mint gives the results of a TNS survey on mobile phone usage in various countries across the world ; while the survey was probably carried out in urban centres, it’s worth a look anyway. Listening to music turns out to be the No. 1 activity that Indians engage with on their mobile phones, the next are playing games, sms/text messaging and taking photos / videos, in that order.

Clearly the villagers that I met reflected a widespread trend.

  • Zenobia Driver

September 17, 2013 at 12:47 pm 5 comments

Now this is how it’s done !

Daihatsu-is-a-chick-magnet

In March, we’d written about the controversial Ford Figo ads on this blog, a mistimed and insensitive attempt at using humour to increase sales and / or win an award.

Recently came across this Daihatsu ad from a few years ago that conveyed a similar message but in a manner that was actually funny and cute. The ad was quite well-received at the time, am now wondering whether I should add lack of originality to the Forg Figo communication team’s list of sins – were they just imitating the Daihatsu ad and taking its basic premise a bit further ?

In case you have more time, busy reader, you can amuse yourself by taking a look at all the car ads shown in this list of ten best automotive print ads of all time.

Enjoy the holiday, folks.

  • Zenobia Driver

August 29, 2013 at 11:18 am 2 comments

Colour bombs nail pops – they rock !

This is a post that I’ve been thinking of writing for some time – ever since I made one of my infrequent visits to a small cosmetics store last year and noticed a brand that stood out on the shelf, or in the basket as in this case.

If you’re in India, visit a small ‘gift shop’ or cosmetics shop or bindi-bangle store in your neighbourhood market and take a look at how nail-polish bottles are stocked. Only expensive nail-polishes from premium brands are kept on shelves, the rest that are priced at Rs. 15 – Rs. 50 per bottle are just dumped higgledy-piggledy into a box or a basket – all colours and all brands together, this box is either kept on the counter or under the counter and brought out when a customer asks to see products.

colourboms pic - grouped pic.jpg

As it is, for the vast majority of consumers, nail polish purchase is driven by colour and price, not as much by brand. To add to it, you have staff at the retail counter who often tell consumers things such as this statement, “aapko color jo pasand aata ai woh nikalo, brand se kya lena dena, sabhi same hai, utne hi chalte hai” (“select whichever colour you like, how does the brand matter, they’re all as popular”). Then how does a brand ensure that consumers are loyal to it and pick it up out of the box each time, from among a huge assortment of polishes such as  VOV, Etude, Bo, 8C Lacque, Incolor, Tips and Toes, Caty Girl ( I kid you not !), Bonjour, Priya, Ambar, Blue Heaven, BCC, Miss Claire, Honey Sweet (like the Bond heroine ?), Teen Teen etc. ?

Well, at least one brand focused on understanding their TG, creating packaging that would appeal to them and get their attention, and then communicating the same. Elle 18, HULs colour cosmetics brand for young women was re-launched in Nov 2010 with the ‘Colour Bombs’ range. The brand was positioned as a young, modern, trendy yet affordable brand for its TG comprising 13-18 year olds who are willing to experiment with explosive colors, as the name ‘Color Bombs’ suggests.

colourboms pic 4.jpg

These products were made to appeal to a young woman / teenager every which way, beginning with the name itself – which young lady does not (at least occasionally) aspire to look like a ‘bomb’ ? The range has the bright vibrant colours that are all the rage with young women today, the packs have a shape that’s different from the packs of other brands, with funky illustrations of women on them that utilize the little blank space available on the small pack most efficiently. The imagery and colors used in the new packaging and communication are young and edgy and completely different from the earlier plain-Jane look of Elle 18. I just loved the way the image on the nail-polish bottle – which no competitor has – made this pack stand out and grab attention amongst the clutter of products in the nail-polish box on the retail counter.

colourboms pic 3

colourboms pic 5

Note : While this post has focused on nail polish, the Colour Bombs range has nail paints, lipsticks, lip glosses, black eye-liner and kohl too, all priced between Rs. 45 and Rs. 100.

colour bombs grouped pic 2

p.s Here’s a link to the ad in case you’re interested. Frankly, I didn’t like this ad much and thought it didn’t live up to the excitement and joie-de-vivre of the brand name and the packaging ; but what do I know, I’m not the TG, I’m an Auntyji.

  • Zenobia Driver

July 30, 2013 at 6:16 am 4 comments

A Placement Puzzle

This week we bring you a fun post, an interesting twist to a well-known sales and marketing funda.

If you’ve read ‘Why we Buy : The Science of Shopping’, Paco Underhill’s classic on the retail environment and how to influence consumers to buy more, you already know a whole lot of interesting facts. You know that products meant for the elderly should not be kept on the lowest shelves as they find it difficult to bend down and pick up products, and sales of these products end up being lower than they ought to be. You’ve also read about the ‘butt-brush’ effect (really apt naming here) – in narrow aisles people get jostled and brush against one another, nobody really likes this and hence they spend less time browsing these aisles and rush out of them as soon as they can. ( If you haven’t read the book yet, do get your hands on it, it’s well-written, fun to read and a lot of what he observes is fairly intuitive and gives the reader a sense of ‘aha, this sounds so logical, why did I not notice this before’.)

You’ve also probably noticed certain products being stocked next to each other or on adjacent shelves at the grocers; for instance, shampoo next to conditioners, moisturisers and face-wash and creams together, all cosmetics together. The logic here is fairly obvious.

So, using that as the base to begin from, here’re two questions for you.

Q1) In some shops in Gujarat, why do shelves stocking a certain brand of fruit juice also have yeast packets stocked ?

Q2) If you look closely, you’ll see that yeast is stocked next to packs of only a certain brand of fruit juice, not all; why is this ?

(Disclaimer : Cannot take credit for working hard and noticing this in the retail environment myself, I heard this at a party this weekend ; am yet to visit Gujarat and verify this for myself, would be glad to hear from any reader who visits or has visited Gujarat too)

And here’s the answer :

Two hints first, so you can try figuring it out yourself. One, Gujarat is a dry state ; two, grape juice, though the answer applies equally to other juices too.

Didn’t get it yet ? Fermented grape juice…wine ! In a dry state, one easy way of making your own alcohol is to buy fruit juice, pour it into a glass bottle, add yeast and wait for it to ferment.

And, to help you out, retailers even keep the juice and the yeast together on the same shelf.

And the answer to the second question is that this doesn’t work with all brands of fruit juice, some have preservatives that kill the action of the yeast. Hence, not all brands of fruit juice have the yeast packets stocked next to them.

[ Additional info courtesy a reader’s comment (Thanks, Rohit). Apparently the grape juice and yeast trick was fairly common during the prohibition era in the U.S. and has been mentioned in this documentary too. Even more interesting is that the write-up mentions that ‘with a wink and a nod, the American grape industry began selling kits of juice concentrate with warnings not to leave them sitting too long or else they could ferment and turn into wine’. Yes indeed, something to really worry about and avoid, I’m sure.]

  • Zenobia Driver

April 25, 2013 at 1:09 pm 4 comments

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