This is the third part of Career in Marketing, for Phase-2, click here and for Phase-1, click here.
Now, we shift our attention to the Medium. We need a Medium to reach the message to our potential customers. Hence, we need to look at all media which attracts “eyeballs”. Till 1982, there were only four media available. (1) Print (which includes magazines as well as newspapers). (2) Radio (which involves the ear and not the eye, but never mind!). (3) Cinema (shown before the film starts with other trailers) and (4) Outdoor (hoardings, wall paintings, bus panels and displays at the point of sale). Post 1982, with the Asiad in New Delhi – we had Television. This brought a new dimension of sound and movement (which cinema had, but this medium was seen far more frequently. You see movies in a theatre once in a while but could see Television daily). Lastly, the penetration of internet and the adoption of social media threw up a new medium which was attracting a large number of eyeballs. Add to this the ubiquity of Smart Phones and we suddenly had net whenever and wherever we wanted it – increasing the eyeballs exponentially. In a sense, Smart Phones did to the net what Television did to Cinema – increased the frequency of access. Also, with increasing affluence, people were willing to spend more money on entertainment. As a result, Rock Shows, Fashion Shows and IPL (which in itself is a Rock Show cum Fashion show with a bit of cricket thrown in) started attracting eyeballs. Hence, Media became much more complex to handle. Advertisers who had a message wanted to know which the best medium was. Or, as common sense will tell you, which is the medium which will reach a larger set of persons more economically. The Media Planners decide on the best media to be used for communicating this message in the most cost efficient way. The Media Buyers negotiate rates with the media to suit the client’s needs. The Event Management Team designs and executes events, which could range from the organization of the Miss Palampur contest to a cultural festival in an IIT. The Social Media team is there to harness the potential of the Net and that includes Social Networking sites such as Facebook, Instagram, LinkedIn, Twitter etc. The rising cost of media has ensured that marketers have started increasing spends on alternate media such as sms, e-mail, and usage of local media such as hoardings, billboards and in shop displays to attract the consumer’s attention. All this is loosely known as Below the Line (or BTL) communication.
Understanding the consumer’s need and translating it into a product or service is just half the job done. This product or service now needs to reach the consumer, who has to buy it. This is equally, if not a more challenging exercise. This is the job of the Sales team. The technical qualification needed will depend on the nature of the product. For technical products such as IT Hardware or Financial Services, a higher level of relevant technical competence will be needed. The Sales profession is the most challenging of professions because of its accountability. Marketing persons who have started their career in Sales usually have a huge advantage over others because of the high level of interface with the business end – the marketplace and hence, consumers.
While the deliverable of all sales teams is the same – maximizing sales, the nature of the skills needed depends on the product of service being sold. If you sit down and analyze all the expenditure heads of your family, you will find the products purchased (we will come to services later) will fall into 3 categories. The first are products where the frequency of purchase is high – and these are products characterized by very “low mean time between purchases”. Typical examples will be soaps, which a household buys once in 30 days to large pack edible oils which a family buys every 6 weeks. Finally to a cigarette purchased by a smoker where the mean time between two purchases in measured in hours! These are called FMCG products or Fast Moving Consumer Goods. The “Fast” is the low mean time between 2 purchases. Then your family could be buying Televisions, Refrigerators or Vehicles for Transportation. The frequency of such purchases is lower – and could range from once in 5 years to once in a lifetime depending the affluence of the family and the nature of the product. These are called Consumer Durables. There are products which we do not buy as frequently as FMCG, but more frequently than Consumer Durables – and these include items such as apparel, shoes, watches (not Rolex!!), accessories and of late, mobile handsets for the new generation! These are typically called Consumer Non Durables. The way we as consumers buy these items differs and hence the nature of the selling differs.
FMCG products are typically purchased from Grocery Stores (or Kirana Stores as they are known as). Many FMCG products are also available in Pan Shops (soaps, shampoos, toffees and a number of items in sachets), Chemist Shops or Medicine Stores (Health Drinks, Shampoos, Skin Care and Baby Care products) and Hot Tea Shops (usually roadside shops – not Barista and CCD!. These sell biscuits and packaged snacks). Hence, for FMCG products, the number of outlets where the product is to be available is enormous (just try and visualize the number of grocery shops, pan shops, chemist shops and hot tea shops in your town/city and you will get the idea). Hence, a career in FMCG Sales will entail a relentless coverage of a large number of outlets with a low transaction size per outlet (for example, Rishta Atta, which is a strong brand in Orissa, the ticket size per transaction in a medium size outlet in Bhubaneswar could be Rs. 1,500 – and they sell a wide variety of wheat and oil products). This also necessitates a good logistic network to ensure delivery of the products to outlets which are scattered and large in number. A number of consumers often decide on the Brand of the FMCG product to be purchased after entering the shop. Hence, the visibility of the Product at the outlet assumes importance. Many consumers, who have a brand in mind, are likely to switch brands if that brand is not available. Hence, availability of the FMCG Brand at the outlet is imperative. This is why the mantra in FMCG is “Availability and Visibility”. Many consumers also buy their FMCG rations from what is today called “Modern Trade” (described in some detail below). These are outlets such as Reliance Fresh, More, Big Bazaar and Spencer’s. These are buyers who buy in bulk. Hence, a company selling to them will have to pay higher margins due to the volumes they buy. This is somewhat balanced by the savings in transportation and logistics costs which need to be incurred in servicing traditional FMCG outlets). FMCG sales in these outlets are showing good growth. That said, the percentage of FMCG Sales in Modern Trade is still in single digits. This means more than 90% of Indians buy their food and groceries from the traditional kirana.
To be Continued . .
- By Prof. Govindrajan
Now, we shift our attention to the Medium. We need a Medium to reach the message to our potential customers. Hence, we need to look at all media which attracts “eyeballs”. Till 1982, there were only four media available. (1) Print (which includes magazines as well as newspapers). (2) Radio (which involves the ear and not the eye, but never mind!). (3) Cinema (shown before the film starts with other trailers) and (4) Outdoor (hoardings, wall paintings, bus panels and displays at the point of sale). Post 1982, with the Asiad in New Delhi – we had Television. This brought a new dimension of sound and movement (which cinema had, but this medium was seen far more frequently. You see movies in a theatre once in a while but could see Television daily). Lastly, the penetration of internet and the adoption of social media threw up a new medium which was attracting a large number of eyeballs. Add to this the ubiquity of Smart Phones and we suddenly had net whenever and wherever we wanted it – increasing the eyeballs exponentially. In a sense, Smart Phones did to the net what Television did to Cinema – increased the frequency of access. Also, with increasing affluence, people were willing to spend more money on entertainment. As a result, Rock Shows, Fashion Shows and IPL (which in itself is a Rock Show cum Fashion show with a bit of cricket thrown in) started attracting eyeballs. Hence, Media became much more complex to handle. Advertisers who had a message wanted to know which the best medium was. Or, as common sense will tell you, which is the medium which will reach a larger set of persons more economically. The Media Planners decide on the best media to be used for communicating this message in the most cost efficient way. The Media Buyers negotiate rates with the media to suit the client’s needs. The Event Management Team designs and executes events, which could range from the organization of the Miss Palampur contest to a cultural festival in an IIT. The Social Media team is there to harness the potential of the Net and that includes Social Networking sites such as Facebook, Instagram, LinkedIn, Twitter etc. The rising cost of media has ensured that marketers have started increasing spends on alternate media such as sms, e-mail, and usage of local media such as hoardings, billboards and in shop displays to attract the consumer’s attention. All this is loosely known as Below the Line (or BTL) communication.
Understanding the consumer’s need and translating it into a product or service is just half the job done. This product or service now needs to reach the consumer, who has to buy it. This is equally, if not a more challenging exercise. This is the job of the Sales team. The technical qualification needed will depend on the nature of the product. For technical products such as IT Hardware or Financial Services, a higher level of relevant technical competence will be needed. The Sales profession is the most challenging of professions because of its accountability. Marketing persons who have started their career in Sales usually have a huge advantage over others because of the high level of interface with the business end – the marketplace and hence, consumers.
While the deliverable of all sales teams is the same – maximizing sales, the nature of the skills needed depends on the product of service being sold. If you sit down and analyze all the expenditure heads of your family, you will find the products purchased (we will come to services later) will fall into 3 categories. The first are products where the frequency of purchase is high – and these are products characterized by very “low mean time between purchases”. Typical examples will be soaps, which a household buys once in 30 days to large pack edible oils which a family buys every 6 weeks. Finally to a cigarette purchased by a smoker where the mean time between two purchases in measured in hours! These are called FMCG products or Fast Moving Consumer Goods. The “Fast” is the low mean time between 2 purchases. Then your family could be buying Televisions, Refrigerators or Vehicles for Transportation. The frequency of such purchases is lower – and could range from once in 5 years to once in a lifetime depending the affluence of the family and the nature of the product. These are called Consumer Durables. There are products which we do not buy as frequently as FMCG, but more frequently than Consumer Durables – and these include items such as apparel, shoes, watches (not Rolex!!), accessories and of late, mobile handsets for the new generation! These are typically called Consumer Non Durables. The way we as consumers buy these items differs and hence the nature of the selling differs.
FMCG products are typically purchased from Grocery Stores (or Kirana Stores as they are known as). Many FMCG products are also available in Pan Shops (soaps, shampoos, toffees and a number of items in sachets), Chemist Shops or Medicine Stores (Health Drinks, Shampoos, Skin Care and Baby Care products) and Hot Tea Shops (usually roadside shops – not Barista and CCD!. These sell biscuits and packaged snacks). Hence, for FMCG products, the number of outlets where the product is to be available is enormous (just try and visualize the number of grocery shops, pan shops, chemist shops and hot tea shops in your town/city and you will get the idea). Hence, a career in FMCG Sales will entail a relentless coverage of a large number of outlets with a low transaction size per outlet (for example, Rishta Atta, which is a strong brand in Orissa, the ticket size per transaction in a medium size outlet in Bhubaneswar could be Rs. 1,500 – and they sell a wide variety of wheat and oil products). This also necessitates a good logistic network to ensure delivery of the products to outlets which are scattered and large in number. A number of consumers often decide on the Brand of the FMCG product to be purchased after entering the shop. Hence, the visibility of the Product at the outlet assumes importance. Many consumers, who have a brand in mind, are likely to switch brands if that brand is not available. Hence, availability of the FMCG Brand at the outlet is imperative. This is why the mantra in FMCG is “Availability and Visibility”. Many consumers also buy their FMCG rations from what is today called “Modern Trade” (described in some detail below). These are outlets such as Reliance Fresh, More, Big Bazaar and Spencer’s. These are buyers who buy in bulk. Hence, a company selling to them will have to pay higher margins due to the volumes they buy. This is somewhat balanced by the savings in transportation and logistics costs which need to be incurred in servicing traditional FMCG outlets). FMCG sales in these outlets are showing good growth. That said, the percentage of FMCG Sales in Modern Trade is still in single digits. This means more than 90% of Indians buy their food and groceries from the traditional kirana.
To be Continued . .
- By Prof. Govindrajan
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