It's down to the last mile

Updated on: Mar 30, 2011
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When Nikon set up an Indian subsidiary in May 2007, its share of compact cameras in the digital camera market was less than seven per cent, and that of DSLRs 29 per cent. To raise its share, it needed to change things — and fast. It set about revamping its distribution, setting up Nikon zones in multi-brand outlets (MBOs), putting the cameras out on display and not inside their boxes so that customers could compare and contrast them with other brands, but also realised more needed to be done. “The market is so small in India (24 lakh units by March 2011), there are more passenger cars than cameras!” says Sajjan Kumar, General Manager (Imaging), India. People needed help to understand the various features, more so in the case of DSLRs. So in 2009, it set about hiring promoters to raise awareness and highlight product features and benefits. “The main thrust was on BTL activities to improve our visibility,” he says, adding that it helped immensely — now Nikon's compact cameras account for 20 per cent of the market and DSLRs 60 per cent.

Another compulsion for employing promoters at stores is that increasingly, decision-making is taking place at the last mile, the retail store. Marketers are shifting expenditure from ATL (above the line) to BTL (below the line) marketing or allocating more for it. Says Sandeep Holani, CEO, Channel Play, a retail marketing company: “In the expensive goods industries such as consumer electronics and mobile phones, product differentiation is so important that an ad alone can't help. Brands need to approach consumers on the shop floor so that they don't move to another brand. With only ATL advertising, you get a consumer base that buys someone else's product.”

Channel Play is a four-year-old, Rs 45-crore company which provides in-store salespeople to represent brands and has expertise in visual merchandising, besides training and event marketing. Holani says they are part of a rapidly growing behind-the-scenes function that fulfils a crucial need of the retail industry.

The retail marketing industry has been growing in importance over the last 10 years. The dizzying range of brands, products and variants within them in most consumer durables and IT sectors, coupled with more aware and interested customers, has made it very important for brands to ensure their case is well-put. It has grown five times in the last five years, says Holani. It's difficult to put a size to the business — not all players provide all services; there are event marketing companies which double up as retail marketers; there are “highly unorganised and unprofessional” outfits and the industry is very fragmented with small and regional players, he adds. He estimates the in-store sales slice of the business at Rs 3,000 crore.

Necessity or nuisance?

V. Rajesh, Head-Retail Solutions, India, TCS, and part of a team that pioneered organised retail in India, however, says that most large-format chain stores in the consumer durables and IT space are moving away from this concept of in-store brand promoters as they end up misleading the customers or fighting over them. In supermarkets or hypermarkets, whose average marketing spend is one per cent of their sale, they are needed as the number of such stores has gone up, and they come in handy to inform customers about a brand's offers, its visual merchandising and especially to build a relationship with the store's neighbourhood/catchment area — distributing and collecting coupons and customer information and such. He adds with a laugh that given the short-term nature of the hiring, a promoter who spoke for one brand today could well speak for another brand a few weeks later.

Brand managers, though, seem to believe they are vital. Prasun Kumar, Head-Marketing, India, Sony Ericsson Mobile Communications, says promoters help bring alive the product experience. “The retail store is a captive environment for the marketer. In our scheme of things, promoters and the visual impact of the product play a very important role as we operate at the high end of the market,” he says, confirming Holani's statement that more is being spent on BTL. “Promotions are spread through ATL media,” he says, adding that a lot of ATL is pushing BTL. He doesn't see a big problem with some chain stores discouraging promoters — “it's a challenge to marketers like us to come out with new ideas.”

Peshwa Acharya, former Chief Marketing Officer, Reliance Retail, and Senior Vice-President (Marketing), Reliance Communications, agrees that a lot of education is required at the store level, but his personal view is that having promoters in the store is disastrous for business. A promoter is always brand-focused while a good retailer should be absolutely brand-agnostic. As for brands being adequately represented in the store in terms of display, he says that depends on how much a brand sells in their store — if Brand X sells 70 per cent and Y 30 per cent, its prominence in the store will be determined by that ratio.

B. A. Srinivasa, Director of the Chennai-based Vivek's chain of consumer durable stores, says his firm encourages brand promoters because of the vast range of products on offer. However, he says the quality of promoters today is not as good as earlier. Earlier, even graduates would be employed in these jobs. If the brand promoters fight over a customer, the store's own staff step in to moderate the situation. Vivek's has undertaken a training programme both for its own salespersons as well as brand promoters to improve their language, communication and personality skills, and this is what modern retail also should do, he says.

Ruchika Batra, General Manager, South West Asia, Samsung, says her company has been spending more and more on retail marketing and promoters, or “product consultants”. Consumer experience is a very important part of the marketing of products as they've become very hi-tech. There is more focus on them and it will grow further as MBOs and large-format retail stores are expanding. Even stores that do not encourage hired consultants train their own staff to speak for particular brands, she says, adding that both store and brand benefit this way.

Published on March 30, 2011

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