Marketing Mix : The Indian Context

Analyze. Adapt. Apply.

Diversity in Unity - India
India- Not a country, a continent
> 1 billion people: Urban: Rural ratio- 30:70

No of States: 29

No of Union territories: 7

No of official languages: 18

No of local dialects: 1500

India- Growth Indicators
Per capita income expected to reach US$ 2000 BY 2025

Expected to be the 3rd largest economy in the world by 2050- US$ 38

Trillion (as much as USA)
It is the second fastest growing economy

Expected to be the 5th largest consumer market in the world by 2025

5th largest retail market growing @10% CAGR
Indian Cos are turning MNCs by global M&A
Dramatic demographic shifts: Pointers
Rising Affluent: HH income > Rs 10 lakh pa
Currently 2.3 mn HHs, earning 12% of countrys disposable income. By 2025 will
be 9.5 mn HHs, will earn 22% of countrys disposable income
Growing middle class: HH income Rs 2- 5 lakh pa- Seekers and HH income Rs 5-
10 lakh pa- Strivers
Currently16% of population, earning 38% of countrys disposable income
Newly emerging bankable class: HH income Rs 90k- 2 lakh pa
Comprises 46% of population, will be attracted to Insurance products (low risk, assured returns).
Downside is low ticket size and high default

Young pensioners:
Young pensioners are typically under 40 individuals who are upwardly mobile,
affluent young generation, who believe in going for a planned retirement.
Young India
Largest young population in the world

Increasing disposable income

> 66% of population is < 35 years of age

Long standing productive working population

Huge domestic market demand

Media Proliferation
> 575 TV channels across languages and genres

> 100 mn C&S TV Households

62,483 Newspapers and Magazines across languages and

genres

> 250 Radio stations

Internet reaching 10% of population- growing @ 40% Y.O.Y

The Other India
The Other India
Since 2000, rural India GDP is growing faster than Urban India (CAGR of

6.2% versus 4.7%)

Between 2010 and 2012, spending in rural India was Rs 3,73, 566 cr versus

urban spends of Rs 2,97,770 cr

Indian FMCG sales will hit Rs 5,48,000 cr by 2025- up from current Rs 65,844

cr

No wonder 67% of the companies in India are making their presence felt in

Tier 4 and beyond towns

The Other India
Rapidly improving rail and road connectivity is helping Distribution of
goods and hence availability

TV is fuelling consumption of brands

Increasing disposable income, improved education, economic

initiatives by the Govt are acting as the catalyst in fulfilling their
aspirations

Mobile is being used as a digital marketing tool- the Missed call model
The Other India : Cos Initiatives
HUL project Shakti which uses rural women to market their products is a huge

success- 20% of rural sales comes from this initiative

Almost 50% of HULs total sales comes from rural India

Godrej Consumer Products trains local youth in Channel sales

ITC has Chaupal Sagar

Godrej Agrivet has set up large format retail stores called Aadhar

45% of all branded soft drinks and 49% of motorcycle sales come from here
Factors influencing consumer behavior

Social Cultural

Consumer
Behavior
Personal Psychological

Technological
Factors influencing Consumer Behavior
Social factor: Social factor divides the society into a hierarchy of
distinct classes. The members of each class have relatively the
same status and members of other classes have either more or
less status. It includes family, group, celebrity etc

Cultural factor: It has potent influences that are brought up to

follow the beliefs, values and customs of their society and to avoid
behaviour that is judged acceptable. Beliefs, values and customs
set subculture apart from other members of the same society.
Thus sub-culture is a distinct cultural group that exists as an
identifiable segment, within a larger, more complex society
Factors influencing Consumer Behavior
Personal factor: It is a very important factor. Personal factors also
influence buyer's behaviour. They include age, income, occupation, life
style. They simply direct our outer personality

Psychological factor: The buying behaviour of consumer is influenced

by a number of psychological factors which includes motivation,
perception, learning, beliefs and attitude and personality

Technological factor: Expanding internet penetration, e-commerce,

phone commerce will increasingly mould consumer behaviour because
of the important value additions it provides- access to info ,
convenience etc
The Ps of Marketing
 THE MARKETING MIX
Blend of the mix depends upon:
Marketing objectives
Type of product
Target market
Market structure
Rivals behaviour
Global issues culture/religion, etc.
Marketing position
Product portfolio
Product lifecycle
Boston Matrix
 The Marketing Mix
The tools available to a business to gain the
reaction it is seeking from its target market in
relation to its marketing objectives

Traditional 4Ps extended to 7Ps to encompass

growth of the Services sector

7Ps Price, Product, Promotion, Place, People,

Process, Physical Environment
 Extended Marketing Mix
Booms and Bitner included
three additional 'Ps' to
accommodate trends towards
a service or knowledge based
economy:
People
Process
Physical Evidence
7 Ps: The Marketing Mix
 7Ps & 7Cs
The 7 Ps The 7 Cs
Organisation Customer
B Product = Customer/ Consumer
L
R Price = Cost
O
A Place = Convenience
Y
N Promotion = Communication
A
D = Caring
People L
The 4 Ps of Marketing
The 4 Ps of Marketing by Kotler.

P P
Product Price

P P
Place Promotion
If the marketer does a good job of identifying consumer
needs, developing appropriate products, and pricing,
distributing, and promoting them effectively these good will
sell very well

- Philip Kotler
Product
a case study
Setting the context

Ford Motor India was established in 1995

Between 1996 and 2005 Ford launched 5 models of cars in India
In 2009 Ford sold around 2000 cars/month while, Maruti sold
71,000 cars/month
Despite large amounts of money spent on advertising and promotions,
as of 2009 Ford occupied only 1.8% of market share
P P
Product Price
P
P
Promotio
Place
n
INTRODUCING
 Sex : Male

Age : Between 25-35

Occupation : Service

Marital Status : Could be single or married

Personality Traits : Professional, Tech-Savy, Fun,

Social, Intelligent, Aspiring

What can he never leave home without? Wallet,

Mobile, Ear phones, House keys
P P
Product Price
P

Sandeep
P
Promotio
Place
n
Product Features:

Exterior Solid Stance, Bold curves and

contours

Interior Spacious interiors, large boot space

Features Steering audio controls, Bluetooth

phone sync, Audio entertainment system with
USB and Aux-In
And the result

Ford India sold more than 30,000 units of the Figo in 25 weeks.

Within 15 months of its launch Figo had sold 100,000 units

Ford Figo became one of the top 5 selling cars in India along with

Maruti Alto, Hyundai i10, Maruti Swift and Maruti WagonR

P P
Product Price
P
P
Promotio
Place
n
Price
a case study
Setting the context
India is experiencing an increase in disposable incomes and
changing lifestyles

Joint families split into working nucleus families (DINKs & DIWKs)

Large format multi-brand retail outlets are the one-stop-shop

(Big Bazaar, Shoppers Stop, Life-style etc.)

However, the maximum footfalls and shopping happened during the weekend
(a sector-wide phenomenon)
P P
Product Price
The return-per-sq. ft. in these large format stores was hence
P
very low P
Promotio
Place
n
Sir, the cheapest almonds used to be at Mohammed Ali road
and the cheapest carrots were under Dadar bridge. But now I
just go to Big Bazaar, they are definitely cheaper and I am
assured of certain quality.

- Anwar
Place
a case study
Setting the context
India is the fastest growing mobile telecommunication market in the world

Indias total wireless subscriber base is 862.62 million (Jan,13) making it the second
largest
after China.

96% of total mobile subscribers are pre-paid customers

Currently there are 13 operators country wide including PSUs

The fastest growing market are the semi-urban and rural markets, with the
P P
advent of low-cost brands Product Price
P
P
Promotio
Place
n
PAAN BIDI SHOPS ELECTRICAL SHOPS VEGETABLE VENDORS
Promotion
a case study
Did you know
Maggi is a Swiss brand started by Juilius Maggi in the late 1800s
Maggi & Co. merged with Nestle in 1947
The brand Maggi Noodles entered India in 1980
At the time they were first to market with no competition in the purchased snack category
The closest competition came from the ready to eat snack category such as biscuits.
For the last 23 years Maggie Noodles has been the number one instant noodle brand
in India
Currently Maggie is the largest selling instant noodles brand in
P P
the world and Indians consume the largest number of Maggie packets Product Price

per year P
P
Promotio
Place
n
Did you ALSO know

Maggie as a brand FAILED at first attempt in the market.

The launch promotion and communication read Fast to Cook. Good to Eat.
Maggie was further promoted as a between meal snacks, since the company
knew Indians had a very stubborn meal habit and would be difficult to change
Since Maggie was a quick preparation snack product, they promoted it to
Working Women (who were short on time and would hence value such a
product) P P
Product Price
The sales figures were devastating P
P
Promotio
Place
n
However

Rather than packing their bags and leaving the market, they embarked to find
out
what their reason for failure was.

In the course of many market research surveys it was found that Not Working
Women, but Children were their largest consumer base.

P P
Product Price
P
P
Promotio
Place
n
Maggi 1980.wmv
Sources:

Brand Equity Foundation

Industry Reports

India Today

TAM

CIA World Fact book

McKinsey Global Institute

Any questions please?