It’s a catch-22 situation. Sales are falling and increasing ad spend seems to be the way forward for brands.

IIPM, GURGAON

Madison Avenue and Wall Street in juxtaposition may appear to be an oxymoron, but in the recent past they have turned into a cynosure for the world’s eyes. The graveyard of fallen American financial brands stands in silent testimony to the reverberating shockwaves emanating from the Wall Street, making their stark presence felt across Madison Avenue. Even as words like recession, bankruptcy and bailouts hog newsprint and the war between Citi and Wells Fargo for ownership of Wachovia continues, the US advertising Goliaths have begun to reel under their impact. The initial hiccups began no sooner than the House of Representatives rejected the bailout package (worth $700 billion). Both Dow Jones and the AdMarket crashed simultaneously. If the former plummeted by 778 points (largest single day decline in history), the latter also had its biggest crash ever - an unmitigated 6.4%.

For the uninitiated, a lot is at stake for Madison Avenue. Advertising elasticity is being put to the toughest test. The top 10 advertisers in the US may have combined spent a humongous $8, 4427 millions (H1 2008) on advertising, yet it marks a 3% decrease from last year. The picture becomes more worrisome when you compare ad spends of the top 50 companies in America, which have already declined by 4.7%. Don’t blame it solely on the September debacle; after all, the stirrings of the mayhem had already begun in March (remember Bear Stearns).

In a year marked by failures of behemoths, bailouts, acquisitions, credit crunch et al, corporates have cut back their advertising and marketing expenditure for the already over-saturated market. Data from TNS Media Intelligence reveals that the total measured advertising expenditure in the first six months of 2008 has declined by 1.6% as compared to the same period in 2007, while Nielsen Monitor Plus puts the drop at 1.4%.

Ford Motor’s comparative advertising expenditure is a classic case; it has cut its advertising budget from $798 million (H12007) to $554 million (H12008), a drop of 30.56%. Even General Motors – grappling with unsustainable losses – now plans to cut its digital media budget. In fact, the ad spending in real terms has come down by 11.2% in the entire automobile category. The rational for the cuts are obvious. Ed Yardeni, President & Chief Investment Strategist, Yardeni.com believes that the would-be buyers simply can’t get auto loans needed to make their purchases. “At 12.5 million units (saar) during September, monthly car and light-truck sales were the worst since April 1992, with both Toyota and Ford posting sales declines of more than 30% from a year ago,” he says, adding that auto sales peaked at 20.6mu (saar) during July 2005, and are now down 40% since then. Clearly, and if advertising spends cannot justify sales (revenues), it is but logical to put a cap on the outgoings.

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Source : IIPM Editorial, 2008

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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Why Study Abroad When IIPM Gives You 3 global Advantages!
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“Technology certainly adds knowledge to retail”

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How important is technology for the retail market?
Technology evolves with the need. And market caters to the need of the people. Retail market is constantly improvising itself & becoming more efficient. Technology is one of the most important tools in management and execution of retailing. In fact, technology helps in research and analysis and finally results in adding knowledge to retail.

Where do you see more technology being used in future and why?
Technology helps in reducing the cost involved in operations, optimising the functioning of the system and helps in monitoring, reporting and delivery in the day to day operations. Technology requirements differ significantly in rural areas. Limitations of telecommunications network, ill equipped P.O.S., severe power problems and ill trained manpower creates a much larger role for technology in rural areas. Retailers in urban areas of the country look for error free & smooth operations, and trust tested technologies in the industry.

Where does technology play a vital role in the retail industry, back-end or front-end?
Technology in the retail industry at the back-end comprises of robust database, intelligent tools (software applications) and dependable communication channels. Front-end requires comprehensive user-friendly interface. Advancement in IT/telecom technologies brings a lot of scope of corrections and improvement. Back-end technology gives more room to play and is always vital to the entire operation.

How do you see the future of technology in retail?
The blend of communication and IT is going to play a larger role in the near future. In fact, the future of technology in retail industry would lie in developing modular, compatible and scalable technology on rapidly changing platforms and protocols. This will help the industry to reach new heights.

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2008

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

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Programme :- SUPERIOR COURSE CONTENTS
Now IIPM's World-Class Education... for everybody!!
IIPM INTERNATIONAL - NEW DELHI, GURGAON & NOIDA
IIPM, GURGAON
IIPM : EXECUTIVE EDUCATION
IIPM’s 36th Glorious Year of Academic Excellence
4Ps Power Brand Awards 2007
When IIPM comes to education, never compromise
Why Study Abroad When IIPM Gives You 3 global Advantages!
IIPM Ranked No. 1 B-School In Global Exposre - Zee...

WHEN KING KONG MET REAL FOOTBALL

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Mauj and Hungama are top-of-mind recall when one mentions mobile gaming in India. But a global player is swiftly preparing its ground, says Savreen Gadhoke

King Kong, Real Football, Midnight Pool, Ferrari World, New York Nights… the names mean a lot to all mobile gaming aficionados, who swear by the game’s time-pass value during boring college lectures, dull office meetings and sometimes even at the cost of their beauty sleep (when the ego trip is all about beating your own score!).

Fact is, mobile gaming has emerged as the latest blockbuster on the entertainment bandwagon, scoring high on the back of the growing wireless subscriber base in the country. Gartner predicts that the mobile gaming industry in India is projected to touch the $450 million mark by 2012 and while revenues from the same stood at $80 million in 2007, the same exceeded expectations over the next few years.

So from being a default application in most handsets, mobile gaming has evolved as an important source of revenues for telecom service providers, handsets manufacturers & publishers too. Encashing on this frenzy are various Indian companies like Hungama Mobile, Mauj Telecom, et al. But global players are not far behind. The $140 million European mobile game publisher Gameloft, which set its foot on Indian soil in 2005, is confident that they would be able to make their dent in the market... and soon!

Headquartered in Paris, Gameloft is already the numero uno mobile gaming company in Europe, number two in the US market and growing at an impressive rate of 40% (in 2007). Gameloft published six of the 18 games in Nokia N-Gage. Over the last three years, Gameloft has concentrated on acquiring channel partners and today has brands like Airtel, Vodafone and Reliance in its kitty. Now, top honchos at this gaming company are gung-ho about the iPhone launch in India, as they are sure it will kickstart an altogether new phase of growth for them. In an interaction with 4Ps B&M, Ravi Kumar, Country Manager (India), Gameloft, reveals the importance of Indian market in its growth strategy.

How important is the Indian market for Gameloft?
India will be a very significant market for Gameloft in the years to come because the volume that we are expecting out of the Indian market is huge. Currently there are 250 million subscribers and the number is expected to go up to 500 million by 2011. So we can expect at least 250 million mobile games downloads. We are probably the only company in game publishing industry, which publishes games for as many as 800 handsets, which means we try to adapt our games to both high-end as well as entry-level models.

Is your gaming content developed in India only?
For the content of the game, we’ve different studios across the world. We have 4,000 people, 90% of which are into content development. We’ve studios in US, France, Japan, China, India, etc. We back our technical capability with technological resources to support. One studio alone does not take the responsibility of creating a game because development of a game is divided into different stages. Depending upon the stage and work allocations, the global production team decides.

But you’ve India-centric games?
We primarily have games for the global audiences. But if you consider cricket game as an Indian game, then we do have India centric games. ‘Prince of Persia’ was also very popular in the Indian market but that was not specifically an Indian game. But we do have a game called ‘Vijay Singh Golf 3D’. Even our games ‘Real Football 2007’ & 2008 did extremely well in India.

You already have a formidable reputation globally. Comment.
Gameloft has a lot of credibility in the International market. We are clearly number one and PG.biz Quality Index survey done by Pocket Gamer (mobile game review website) has ranked Gameloft as leader in terms of quality. We are number one in sales too. Both qualitatively & quantitatively we are clearly ahead. We have a lot of ideas for iPod & iPhone and we expect a transition in the mobile gaming business with the launch of iPhone in India, because it has a lot of applications like the touchscreen, which fit very well with the new taste in gaming. We have adapted our games to the iPhone too and are ready to develop more games.

But when you talk of Mobile Gaming in India, Gameloft is not top-of-mind recall?
Well, we first wanted to have our sales partnerships in place and only then go about tom-tomming our brand in India. Now that we have those partnerships in place and are confident about our line-up, we will do the brand building exercise. Since our units are in place, you will see the Gameloft brand picking up in India.

What are the critical challenges that Gameloft faces in India?
If India wants to grow its mobile game industry, wireless carriers will have to take a leaf from Japanese business practices. Higher revenue sharing with game developers, according priority to developers instead of aggregators, allowing developers to host their own page on carrier’s portal are some of the key challenges. When developers host their own page, they have better control on what to sell and how to sell, eventually translating into more sales. Unfortunately in India, aggregators are calling the shots & pulling down creative quotient of the industry.

How does Gameloft plan to establish itself in the Indian market?
We want to grow into a trusted brand. There is lot of uncertainty when a customer downloads a mobile game. We try to ensure that all our games match the quality expectation of consumers. We want to build a relation with Indian consumers where they feel that purchasing from Gameloft is sure-shot gateway to international quality experience in mobile gaming. We would like to grow our distribution channels, and work with carriers like Reliance & BSNL too.

How do you visualise the mobile gaming industry in the coming two years in India?
The government and TRAI want that operators work more on the VAS side because telecom players get a good margin from these services. In APAC region, a 45% yoy growth is expected in video games across formats including mobile games. Number of telecom players is increasing by the day and keeping in mind the demographic shift that is happening; mobile gaming has a good bright future in India.

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2008

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

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Programme :- SUPERIOR COURSE CONTENTS
Now IIPM's World-Class Education... for everybody!!
IIPM INTERNATIONAL - NEW DELHI, GURGAON & NOIDA
IIPM, GURGAON
IIPM : EXECUTIVE EDUCATION
IIPM’s 36th Glorious Year of Academic Excellence
4Ps Power Brand Awards 2007
When IIPM comes to education, never compromise
Why Study Abroad When IIPM Gives You 3 global Advantages!
IIPM Ranked No. 1 B-School In Global Exposre - Zee...

I am your move

IIPM, GURGAON

Now the signs of this change are also visible in India. Apart from the chic Reebok Classic stores, the once sportswear major has tied a knot with designer Manish Arora (for the Reebok Fish Fry range) and another with Bollywood diva Bipasha Basu (as their brand ambassador). Interestingly, the duo have nothing to do with sports, except perhaps Bips starring role in Goal. Clearly, Reebok has its eyes set on India’s haute couture market. But isn’t Reebok trading the cook for the cookie? After all, the brand has gone to great pains to carefully cultivate its sporty image in India and that’s where the revenues have been pouring in from, at least until now! Subhinder Singh Prem, MD, Reebok India, does not agree. “We are trying to capture all segments of the apparel market, but we are not compromising with the brand image. Reebok Classic will even have denims designed by Dhoni and Yuvraj. All our cricketer brand ambassadors would be promoting all Reebok brands,” he says, citing the ads featuring Bipasha, which either show her in a sporty attire, or playing a sport (remember Bips in the boxing ring!). The company is taking pains to keep the sporty image alive by strengthening the brand association with cricket in India. In June this year, Reebok rolled out cricket stores, which display cricket paraphernalia used by cricketers in major cricket series. “To sustain market share as a sportswear brand in India you cannot ignore cricket and we wanted to do something that other players had not done ever,” explains Subhinder.

The strategy is to tap the new segments, without compromising on its inherent sporty image. Since the beginning of Reebok’s Indian odyssey, its brand association with cricket has helped Reebok steal the show from rival Nike (which connected with cricket only in 2006). Now Reebok is mulling a different penetration strategy by focusing on store expansion. Already in 225 cities with 751 stores (Nike has 500 and Puma 425 stores), Reebok wants to up the stakes further to 1,000 stores by the end of 2008. Is that Subhinder singing ‘catch me if you can?’

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2008

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

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM Programme :- SUPERIOR COURSE CONTENTS
Now IIPM's World-Class Education... for everybody!!
IIPM INTERNATIONAL - NEW DELHI, GURGAON & NOIDA
IIPM - Admission Procedure
IIPM : EXECUTIVE EDUCATION
IIPM’s 36th Glorious Year of Academic Excellence
4Ps Power Brand Awards 2007
When IIPM comes to education, never compromise
Why Study Abroad When IIPM Gives You 3 global Advantages!
IIPM Ranked No. 1 B-School In Global Exposre - Zee...