Buzz Power 2008: Keep it simple, silly

The post-lunch session at Buzz Power offered a word of caution to marketers that promotions are double edged swords, loaded with the power of having an adverse or positive effect on any brand

Word of mouth (WoM) is increasingly finding its way into the promotional strategies of most brands. However, they have to be coupled with simplicity and innovative media. The post-lunch session at Buzz Power, an initiative organised by agencyfaqs! and Kingfisher at the ITC Grand Central in Mumbai on February 14, offered a word of caution to marketers that promotions are double edged swords, loaded with the power of having an adverse or positive effect on any brand.

The session, Do Promotions Create Positive Buzz for a Brand?, was moderated by Kiran Khalap, ad man and co-founder, Chlorophyll Brand & Communications Consultancy. The panellists included Abdul Khan, vice-president and all India marketing head, Tata Teleservices; Andrew Levermore, chief executive officer, HyperCity Retail; and Gunjan Srivastava, senior director, marketing, Philips Consumer Lifestyle.

Khalap vouched for WoM, quoting figures from a Nielsen study. WoM, according to the study, was estimated to stand at $1 billion in 2006 and has grown by 35 per cent in the last year, he said. The study, according to Khalap, voted for WoM, with 78 per cent of the people sampled (26,000) taking recommendations seriously – a figure that is 15 per cent higher than the second most credible source, newspapers.

Kiran Khalap

Why is buzz important? According to Khan of Tata Teleservices, there is increasing ad clutter and marketers are looking for new options to promote their brands. Marketers also have to face pressure from technology, which has accelerated word of mouth. Khan said marketers often seem to suffer from the Conditions Apply syndrome, wherein the communication for their brand does not match with the product promise – a phenomenon particularly common in the airlines and telecom categories.

Khan’s advice comes clean and straight: There should be credibility and communication should speak the truth and nothing else.

Besides authenticity, the other issues Khan said were important for the success of a promotion were resonance, perceived exclusivity and paradigm change. He cited the Gmail example to drive home the power of a community that starts on its own. The popular email service became popular only because of its exclusivity factor, as it opened to users not on a registration basis, but only by invitation.

Abdul Khan

Crediting his own brand, Tata Indicom, for bringing in a paradigm change, Khan talked about a promotion that turned into a product. Khan recalled how Tata Teleservices reacted to the consumers’ need and launched a scheme for mobile users, Tata Indicom NonStop, using which consumers would never need to get a recharge done. Other telecom companies followed suit and the promotion got turned into a product which many today call lifetime validity.

Levermore, the next speaker, shared his retail experience. According to him, shopping in India is more of entertainment. “Indians shop as a family. They spend more time in stores. Forty per cent of the purchase in India is done on impulse,” he said.

All this, he added, means more retail oriented promotions that, in turn, will get more returns. In spite of such virtues, the task for marketers is not easy. For a retail promotion to be effective, it has to be “innovative and supported by attractive communication, proper placement and ample trial inducement”.

Andrew Levermore

Levermore tried to bust the myth that high traffic areas bring in more footfalls. “High traffic areas are not conducive to stopping and looking. Instead, medium traffic areas are the best for a retail store to be successful,” he explained. Often marketers err because they assume that visibility leads to sales. Sample trials at a retail environment have the capability of generating sales 100 times more than a retail walk-in, he said.

He gave examples of some bizarre promotions – a cold drink free with a deodorant or a glue stick free with orange juice. He said this should be avoided at all costs. “This is an area which marketers need to look into and try and match the product and the promotion,” he said.

Gunjan Srivastava, senior director and customer marketing manager, Philips Consumer Lifestyle, pointed out that promotions need to be strategic and, in addition to improving monthly sales, should help in longterm brand building. “More than 70 per cent promotions fail because they are not supported with adequate budgets. Indeed, it would be much better to run fewer programmes that are strongly promoted than a larger number of sub-optimal efforts,” he said.

Gunjan Srivastava

The consumer electronics company gathered this insight from its global Philips Simplicity Programme 2007, which reached out to 30 million target customers. The programme received 8,000 entries against an expectation of 3,000.

Answering a question from the audience whether the company was looking forward to localising its programme, Srivastava answered in the affirmative. “We are internally discussing to come up with hyper-local programmes,” he said.

However, he said that all consumer promotions need to be completely integrated across all media – outdoor, retail, newspaper, radio and television. “The interactive media – the Internet and mobile – will assume far greater importance with increasing penetration and services like SMS. Localised media like radio, supported by interactivity, can be used to increase participation,” he added.

Echoing Khan’s words, Srivastava too stressed on the credibility of the offer. “Most consumers want to be sure of a high probability of winning and the credibility of the offer and that of the brand play a key role. Gifts that they can relate to are more persuasive than unfamiliar incentives, however attractive,” he said.

The universal message from the session was to couple innovative media with simple messages – simple messages work the best – to help break through clutter and urge quick action.

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