Monthly Archives: July 2017

Insights on Making Strategies: In Conversation with Shireesh Joshi

Mr. Shireesh Joshi (ex-COO, Strategic Marketing Group at Godrej) was a guest speaker at Colloquium, the annual business conclave organized at IIM Indore. He shared his experiences in the field of strategy from organizations like Godrej, Airtel, PepsiCo and Procter & Gamble. Mr. Shireesh also discussed how to create an appropriate sustainable advantage and position a product in the value chain. After the engaging talk, we caught up with him for a short interview-

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Sonali- You discussed about creating sustainable advantage. How important is it to keep updating that sustainable advantage, keeping in mind companies like Blackberry and Nokia and how to do that?

Shireesh-Your examples prove how important it is to keep it updated. Updating the sustainable advantage is actually a matter of life and death for companies. The point worth noting is that if there is anything you need to update, it has to be in your area of sustainable advantage. This is because, if things get updated in your peripheral areas, they don’t hurt you but if things get updated in your core area and you are not part of that, then you get outdated almost instantly. So, you have to be leading the effort of updating the core area of your strength all the time.

Sonali- Sometimes when the sustainable advantage is lost or is flawed, when should a firm go for rebranding and how should it be done?

Shireesh-I think whether you do rebranding or not, it should be led from a consumer’s standpoint. So, if you feel that over a period of time, what your brand is and what it stands for has started to become a little bit distant from your target consumer and it is not possible to do activities to bring it closer, then sometimes, one way of making a significant change, signaling that change and recreating a fresh relationship is rebranding. But, it must first begin with the consumer and for whatever reasons you do rebranding, make sure to define, in what terms is the new consumer different from the earlier one and in what way their aspirations and expectations are different from the earlier ones. Also, make sure that the brand that you now craft is much more suited to these new aspirations than it was for the earlier ones. A loose description can be let’s say my parent’s generation, they bought stuff that they wanted to last their entire lifetime and they did not expect it to be replaced. Then came our generation, who might want to replace stuff. Next, may be your generation would not even own it, everything might be leased. So, there are very different mindset. As those mindsets and preferences change, then brands must evolve. For example, if I want to replace things frequently then I don’t want to pay for something that is going to last 30 years. So if you tell me that this thing will last 10 years and it costs 100 bucks and another one will last 30 years and it costs 250 bucks, I don’t want the second one although I can see it being justified. So then, the brand will have to go for rebranding because the long lasting quality in itself is going out of fashion. So you have to keep looking in what way the consumers are changing, their needs are changing and then create the brand. In addition, make sure that the new avatar that is created, is in conflict with the earlier avatar, then only you should rebrand. It should not be done just to correct the declining sales.

Sonali- So, when we talk about updating and accommodating change, another thing that strikes me is the usual saying of ‘Fast eats big’. It is because new and smaller firms are more flexible than the old and larger ones due to more complex organizational structure. How does a 120 year old company like Godrej manage to stay flexible and relevant?

Shireesh-So, first of all Godrej has been very careful of not having a centralized organizational structure. There are individual divisions and decentralization. So each division of company is managing one kind of business like Godrej Property handles property business, Godrej Appliances is the appliance business and so on. Then, they look at where are the synergy areas, say if there is a synergy in buying, so when they are buying, they will buy for multiple businesses. So it has been purpose built and should not be just for the sake of managing operations of a large business. The good thing with Godrej is the multiple family members involved who are able to cover all ground of operations between them, without really creating a structure. So, each team is competing with its competitors but that does not mean all divisions have been good at doing that. But the reason that such divisions have not faulted is that they are not centrally structured.

Sonali- Coming back to the strategies, why is it that the same strategies work for some firms and not for others in the same industry? This is in reference to the deep discount model that failed for Snapdeal while it seems to be working for Flipkart, to some extent.

Shireesh-Yes the operative word is ‘seems to be working’ because discount is not really a strategy. It is only for a temporary period during which you can use that to lure customers but you can’t keep giving discounts forever. There is a reason why margins are what they are because that is what make them sustainable. For a period, you can dip into those margins in order to attract customers but it cannot be a strategy because strategy requires you to be able to sustain those margins. Now if you have found a way of doing business that is, let us say, take 5 points of operational costs out, in that case you might be able to consistently beat others till somebody finds a new system that beats yours. But if that is not the case and all you are doing is simply taking products and assuming you might have some efficiency in operations. But efficiency in operations cannot explain the kinds of discounts you see in ecommerce market place. So these are unsustainable and that is only taking place because there is VC funding that is available for the purpose of customer acquisition and building a customer base.

Mr. Shireesh Joshi is the CEO and Principal Consultant at Priism Consulting. Previously, he has held position of COO, Strategic Marketing Group at Godrej and other key positions at PepsiCo and Procter & Gamble. He has a diverse experience in various fields across India, China and South East Asia, among others. He completed his MBA in marketing from IIM Bangalore and B.Tech from IIT Kanpur.

Ignatia 2017 Report

The second edition of the annual inter-IIM sports festival, Ignatia, was held this year at IIM Indore from the 21st to the 23rd of July, 2017. It witnessed enthusiastic participation from IIMs Indore, Calcutta, Lucknow, Ranchi, Raipur and Shillong in cricket, football, badminton, table tennis, squash, lawn tennis, volleyball, chess and basketball.

The festival was inaugurated on the 21st of July with matches between IIMs Indore, Calcutta and Lucknow. After 3 days of intense competition and great displays of sportsmanship, Ignatia 2017 was won by IIM Indore, with a total of 83 points, followed by IIM Calcutta at 77 and IIM Lucknow at 41. In terms of individual sports, IIM Calcutta won the largest number of gold medals, emerging as the champion in 5 events, followed closely by IIM Indore with 4 gold medals.

Ignatia was concluded with a prize distribution and felicitation ceremony organised on 27th July, 2017 at the campus of IIM Indore. A panel of three distinguished professors of the institute were invited to be the dignitaries for the ceremony and prizes were awarded to all the individual champions and to the victor institute.

The mantra of digital marketing and e-commerce – an interview with Hitesh Malhotra, CMO, Nykaa

A UC-Berkeley Alumnus, Mr. Hitesh Malhotra (Chief marketing officer, Nykaa) visited IIM-Indore on 29-July-2017 for Colloquium, the Annual Business Conclave of IIM Indore. The theme of this year was “The Strategy Spectrum” and Mr. Hitesh spoke about India’s premier beauty and wellness portal – Nykaa.com and what differentiates it from other e-commerce players. We caught up with him after the talk, for a small interview. Here is what he had to say about e commerce, Nykaa and digital marketing:-

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Nishant: How did you get into digital marketing and what interested you in digital marketing?

Hitesh: I was in brand marketing first and digital wasn’t big enough in 2005 when I finished my engineering, and I was focusing mainly on the retail marketing, but then something very weird happened. I was in a mobile company and then suddenly we realized that the return on ads that we are getting just out of one simple Google ad were 10 times cheaper and stronger than what we were getting in the retail. So we thought that if one small Google ad can make such a big difference in terms of return on ads spent then how big it will be if we scale all of this together, so then I got interested into the science and got deeper into it and realized that in next 10 years digital marketing will lead the race of marketing.

Nishant: According to you, what will be the impact of GST implementation on Nykaa’s Sales?

Hitesh: There could be a little period, till the time, people are used to pay certain taxes, on certain line of products, some products will be benefited, some will stay where they are in terms of pricing, some product pricing will increase, but eventually people will understand that they are getting benefited some way or the other. They might be paying more for a beauty product but they are also paying less for eating out in restaurants. Once they get their expenses balanced, it will be neutralized.

Nishant: Do you plan to acquire more number of male customers or go into the male segment too?

Hitesh: That’s not my business model. I am focusing on women customers at a larger scale and I want to stick to the core only.

Nishant: Are there any advantages of conventional marketing over digital marketing?

Hitesh: Both have their own strengths, conventional marketing has a very good ability, you can talk good stories about a brand, and you can build brands very strongly on offline marketing. The benefit of digital marketing is that the results are measurable whereas in conventional marketing, you have to work through different methods to arrive to a result and that too could have a high level of inaccuracy.

Nishant: What are your favorite tools related to digital marketing?

Hitesh: I think the best are analytics tools; either you work on Google analytics or Omniture Adobe. After that I would say, the typical marketing efficiency tools or the typical digital marketing outreach tools like Facebook marketing, Google AdWords are my favorites.

Nishant: How do you see the future of digital marketing? What trends do you foresee?

Hitesh: The trends are already here, every day the future is shaping for digital marketing. A lot of platforms are coming, and every platform has a new science around it. Earlier TV was the main media, then it moved to Youtube and now it has moved to OTT platforms like Amazon Prime, Netflix and Sony liv or Voot. I think new platforms will keep on emerging and with every new platform, there will be more consumption digitally.

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About Hitesh Malhotra: He is a UC-Berkeley Alumnus, and has held roles in strategy formation and all level analytics at Levi Strauss, USA and best in class engagement practices with MakeMyTrip.com. He excels in performance marketing, integrated communication and engagement strategy for brands. As Chief Marketing Officer at Nykaa.com, he spearheads digital, main line and customer relationship marketing -controlling 20% P&L at organization level.

Lok Sabha passes IIM Bill

Lok Sabha,New Delhi: The Lok Sabha on friday passed the Indian Institutes of Management Bill 2017 that provides administrative, academic and financial powers to IIMs and allow them to grant degrees. The bill grants powers to IIMs for appointment of directors, faculty members and removes the tremendous government interference that these B School faced earlier.

HRD Minister Prakash Javadkar said, “We are giving real freedom to our institutions, there would not be any government control. We have to trust the best brains, the best institutions.”

India has 20 IIMs now. The bill which was approved by the union Cabinet in January will grant greater autonomy to IIMs. The management of IIMs will now be board driven, the bill will ensure that the chairperson and the director are selected by the board. This means that there will be no interference from the HRD ministry or the President of India.

Rajya sabha is expected to take up the bill next week, where it will be discussed and evaluated further.