So the big news of recent times was the launch of the Apple iPhone 3G in India less than 11 weeks after its glonal launch and the big shocker was the price point - 31,000 for the 8GB model and 36,100 for the 16 GB model - roughly 4 times the US price.
Frankly speaking they got it wrong. India is an extremely price sensitive market. People here no matter how affluent will always look for value for money and will not splurge good money on things like design. Its in our DNA. Let me state that its not the question of price for the indian consumer but if the price is justified at all. Thats the moot point. Once we are convinced that its worth the price, only then we'll go for it. Thats why all the companies around the world have a special strategy for India because we are firm about things and what they are supposed to cost.
Thats why the iPhone strategy is baffling. Are they really asking the Indian consumer to pay 4 times the price of what consumers pay in the US after not being able to avail the 3G facilities because (this is classic) 3G is not functional yet in India. Are these people for real? The folks at Vodaphone are defending their strategy by saying that they wanted to position this product as an aspirational product rather than as a mass product. When did mass become a bad thing anyhow?? and how does a product which does not have facilities to forward an SMS become an aspirational product??
Apple doesn't have cult status in India. They don't have frenzied fanboys who'll wait in freezing cold for a midnight launch. They can afford to be arrogant in the US because they have managed to cultivate a loyal legion who'll lap up whatever Apple offers and be its evangelists. Not in India. They don't even have an India office. What they needed to do was create that loyal base in India to ensure that they had some presence in the fastest growing telecom market in the world. Granted in the US, AT &T heavily subsidizes the price of the phone by keeping the user locked to the service for 2 years but I hear in India too its on similar lines. One needs to pay activation charges and the sim is locked to the phone.
The telecom operators could have played it in a smarter manner. I'm sure if the price was attractive enough, people would not have minded sticking on with the same service provider. They've lost a brilliant opportunity to control a captive market. The ones who are gaining in this mess are Nokia and Sony Ericsson. All they have to do is come with a phone which costs half the price and double the features and they can pretty much kick IPhone's butt. They really don't get the indian consumer do they??
Tuesday, August 26, 2008
Sunday, August 10, 2008
Long tales and other good reads
So things have been good. Been reading a lot of good reads lately. Few of the really good ones for your perusal & consumption below:
Chris Anderson's Book - The Long Tail
I know, I know i'm behind the curve on this one. The Long Tail: Why the Future of Business Is Selling Less of More (2006) by Chris Anderson, the Editor-in-chief of wired magazine (the favourite read of this blog) is a stellar book and must be read by everyone who is remotely interested in economics. Yes Economics and not just the internet. Anderson in this book talks about the remarkable manner in which the internet has re-written traditional retail that focussed solely on "hits" due to the constraints of supply chain and inventory costs. The main focus is on how, due to the internet, the market is moving towards the "non hits" as people are moving from mass consumer products to more customized niche products.
I knew about the Long Tail theory pretty much when the book released but this book has given me an insight on Search Engines that I never noticed before. The sieving quality of search engines to negotiate all the clutter on the net.That, methinks, is the saviour of the long tail. Yes there is significant choice out there thanks to the internet and the availability of information. But choice is useless unless you can get to it. Search Engines sift through the internet to get you what you want. That's why a Search Engine on the web portal is crucial.
Most companies do not pay attention to the search engines on their own web portal because they think their own portal is a small universe and people will get to the content any way. But regardless, navigating any portal can sometimes be overwhelming. I personally hate it when search queries within a site don't work and give out odd results. Especially when its at odds with Google. The big takeway for me personally from this book was that marketing to the long tail because of its niche drive preference is going to be difficult and sometimes not feasible but if one has an elaborate website, investing in good search engine technology and a recommendation alogorithm will ease things up significantly.
One of my favourite lines in the book tho, is when he describes Fiona Apple as "Delightfully Unhinged". I'd like to wear a T-shirt that says that! More on the book here. Also read the Long Tail blog here
There's a blogging exchange of words going on in Harvard Business Review between Chris Anderson and Anita Elberse, a harvard prof. Elberse is arguing on if one should take the long tail seriously and invest in it. Its an extremely good read and besides its greatly stimulating to see two intellectuals argue. Register on the HBR site and you'll get access to it. Can't link to it unfortunately :(
More shameless Wired Plug Alert
Yes well, what can I say I'm like a wired groupie these days. Wired is celebrating its 15th anniverssary this year and because of that one is able to access a lot of past gems. I chanced upon a wired article on the landmark US Vs Microsoft anitrust case. Th article, all of 45 pages, was published after the judgement to break up Microsoft was delivered in 1998. The article brilliantly narrates the events leading up to the case and gives inside scoop on all the players involved especially the Department of Justice (DoJ) and Microsoft.
The article reads like a salacious saga and is completely absorbing. Besides that it gives one valuable insights on US anti trust laws. By the end of this article, one gets to know the Sherman Act better than one's right hand. You also get know the ugly side of Microsoft. I'm not sure if the article was particularly biased against Microsoft but its not flaterring in anyway. I don't really get why people in tech hate microsoft so much. It may be vehemently dominating and they may not make the best of products but hey nobody out there has an OS that matches Microsoft. I use MS products evryday and I don't think I should crib particularly when I have not seen a better product to rival it. Read the article here
This made me wonder if India has Antitrust laws? Anyone know? Also I don't particularly think its a good idea, not right now any way. We've just become a free economy, what we don't need right now is a regulatory law. Besides, the ambanis and tatas of this country would never allow it
*end shameless plug*
More bounty
The Economic times recently had a great article on Leadership. In an article called "Four fundamental laws for CEOs racing against time" the author, with good examples, illustrates the 4 guiding principles that CEOs, who are pressed for immediate results, should adopt.
Another article in ET talks about the importance of customer advocacy. The author makes the case about why one should always invest in building a loyal community of users as the latter could come to the rescue during bad times. Read the Article here
Chris Anderson's Book - The Long Tail
I know, I know i'm behind the curve on this one. The Long Tail: Why the Future of Business Is Selling Less of More (2006) by Chris Anderson, the Editor-in-chief of wired magazine (the favourite read of this blog) is a stellar book and must be read by everyone who is remotely interested in economics. Yes Economics and not just the internet. Anderson in this book talks about the remarkable manner in which the internet has re-written traditional retail that focussed solely on "hits" due to the constraints of supply chain and inventory costs. The main focus is on how, due to the internet, the market is moving towards the "non hits" as people are moving from mass consumer products to more customized niche products.
I knew about the Long Tail theory pretty much when the book released but this book has given me an insight on Search Engines that I never noticed before. The sieving quality of search engines to negotiate all the clutter on the net.That, methinks, is the saviour of the long tail. Yes there is significant choice out there thanks to the internet and the availability of information. But choice is useless unless you can get to it. Search Engines sift through the internet to get you what you want. That's why a Search Engine on the web portal is crucial.
Most companies do not pay attention to the search engines on their own web portal because they think their own portal is a small universe and people will get to the content any way. But regardless, navigating any portal can sometimes be overwhelming. I personally hate it when search queries within a site don't work and give out odd results. Especially when its at odds with Google. The big takeway for me personally from this book was that marketing to the long tail because of its niche drive preference is going to be difficult and sometimes not feasible but if one has an elaborate website, investing in good search engine technology and a recommendation alogorithm will ease things up significantly.
One of my favourite lines in the book tho, is when he describes Fiona Apple as "Delightfully Unhinged". I'd like to wear a T-shirt that says that! More on the book here. Also read the Long Tail blog here
There's a blogging exchange of words going on in Harvard Business Review between Chris Anderson and Anita Elberse, a harvard prof. Elberse is arguing on if one should take the long tail seriously and invest in it. Its an extremely good read and besides its greatly stimulating to see two intellectuals argue. Register on the HBR site and you'll get access to it. Can't link to it unfortunately :(
More shameless Wired Plug Alert
Yes well, what can I say I'm like a wired groupie these days. Wired is celebrating its 15th anniverssary this year and because of that one is able to access a lot of past gems. I chanced upon a wired article on the landmark US Vs Microsoft anitrust case. Th article, all of 45 pages, was published after the judgement to break up Microsoft was delivered in 1998. The article brilliantly narrates the events leading up to the case and gives inside scoop on all the players involved especially the Department of Justice (DoJ) and Microsoft.
The article reads like a salacious saga and is completely absorbing. Besides that it gives one valuable insights on US anti trust laws. By the end of this article, one gets to know the Sherman Act better than one's right hand. You also get know the ugly side of Microsoft. I'm not sure if the article was particularly biased against Microsoft but its not flaterring in anyway. I don't really get why people in tech hate microsoft so much. It may be vehemently dominating and they may not make the best of products but hey nobody out there has an OS that matches Microsoft. I use MS products evryday and I don't think I should crib particularly when I have not seen a better product to rival it. Read the article here
This made me wonder if India has Antitrust laws? Anyone know? Also I don't particularly think its a good idea, not right now any way. We've just become a free economy, what we don't need right now is a regulatory law. Besides, the ambanis and tatas of this country would never allow it
*end shameless plug*
More bounty
The Economic times recently had a great article on Leadership. In an article called "Four fundamental laws for CEOs racing against time" the author, with good examples, illustrates the 4 guiding principles that CEOs, who are pressed for immediate results, should adopt.
Another article in ET talks about the importance of customer advocacy. The author makes the case about why one should always invest in building a loyal community of users as the latter could come to the rescue during bad times. Read the Article here
Wednesday, August 6, 2008
Cat got the cream
I was reading today on afaqs on the success of Meow FM, which is apparently a "womens only radio station" and the first niche radio station in the country. I have, on travels to delhi, heard Meow FM and the one thing that struck me was that it was extremely chatty. More prone to talk than to music. Ofcourse the talk centred on steoreotypical topics usually associated with women - relationships, clothes shopping etc. But what works for this radio station is pure differenciation
Differentiate or die. I feel I should create a T shirt and embrace this slogan. Its especially true in market which is overcrowded and the opportunities for differentiation is small. Thats the story of the Indian radio scenario where all stations pretty much play the same music and sound the same. Yes there are myriad types of music but if you consider the Indian milieu, if you're not playing bollywood music you might as well die. Some channels do play english music as a point of differentiation but the audience for that is still very small even in urban cities. The issue for radio stations is to cater to a mass audience and still be different. World space kind of attempted this by catering to various music like southern music, classical music and more but again the critical mass of all these channels, I feel, weren't significant. Meow's differencitation of catering only to women has apparently worked. According the article, Meow enjoys "a share of 3 per cent in Delhi; in Mumbai, the share is 2 per cent. In Kolkata, however, where it was launched recently, the share is 8 per cent".
In the name of differentiation, one might end up catering to a niche and that might be a risky proposition but as the Meow FM scenario shows, it might also work to an advantage especially with advertizers. As the channel is so niche, advertizers, for whom women are a major target audience, prefer to advertize on this channel as the effectiveness of advertizing increases. So more buck for your money because your audience is being appropriately targetted. Meow attracts advertisers who are interested in women’s products and women consumers, such as the FMCG brands, retail brands and educational institutes. "You won’t see too much property, banking and financial brands on our station," Meow's Chief operating officer, Anil Srivatsa asserts.
Meow in fact has gone one step further. The article goes on to say that because their channel is so niche, "Meow has a dedicated team called Meow Research, which conducts research on women, lifestyle choices, product preferences and the various aspects of a woman's buying pattern or behavioural pattern. This data is churned out every two weeks and will soon be made available to anybody – advertisers or media agencies – who wants to use it ". Who said advertising was the only way to make money?
Another interesting feature is that Meow has started a social networking site called merimeow.com which not only enables them to connect with their audience over web 2.0 but also, as most Social Networking sites require sign ups and profile entries, these guys get valuable profile information on their target audience. They get to know which dempgraphic listens to meow the most, what's hot, what's happening, what the buzz is and more!! Jeez these guys ARE smart! Infact on checking the site out, I was reminded of another brand that used web 2.0 very very smartly - Sunsilk's Gang Of Girls website.The Meow website has a virtual bazaar that no doubt markets women's products. Soon there will be tie ups with third party companies that cater to cosmetics, soaps etc and meow will end up creating another revenue stream.
A lot of interesting best practices from a radio station that no one took seriously when it first launched and which proved that differentiation is critical for survival. Read the complete article here
Also, I really do not want to say MEOW one more time
Differentiate or die. I feel I should create a T shirt and embrace this slogan. Its especially true in market which is overcrowded and the opportunities for differentiation is small. Thats the story of the Indian radio scenario where all stations pretty much play the same music and sound the same. Yes there are myriad types of music but if you consider the Indian milieu, if you're not playing bollywood music you might as well die. Some channels do play english music as a point of differentiation but the audience for that is still very small even in urban cities. The issue for radio stations is to cater to a mass audience and still be different. World space kind of attempted this by catering to various music like southern music, classical music and more but again the critical mass of all these channels, I feel, weren't significant. Meow's differencitation of catering only to women has apparently worked. According the article, Meow enjoys "a share of 3 per cent in Delhi; in Mumbai, the share is 2 per cent. In Kolkata, however, where it was launched recently, the share is 8 per cent".
In the name of differentiation, one might end up catering to a niche and that might be a risky proposition but as the Meow FM scenario shows, it might also work to an advantage especially with advertizers. As the channel is so niche, advertizers, for whom women are a major target audience, prefer to advertize on this channel as the effectiveness of advertizing increases. So more buck for your money because your audience is being appropriately targetted. Meow attracts advertisers who are interested in women’s products and women consumers, such as the FMCG brands, retail brands and educational institutes. "You won’t see too much property, banking and financial brands on our station," Meow's Chief operating officer, Anil Srivatsa asserts.
Meow in fact has gone one step further. The article goes on to say that because their channel is so niche, "Meow has a dedicated team called Meow Research, which conducts research on women, lifestyle choices, product preferences and the various aspects of a woman's buying pattern or behavioural pattern. This data is churned out every two weeks and will soon be made available to anybody – advertisers or media agencies – who wants to use it ". Who said advertising was the only way to make money?
Another interesting feature is that Meow has started a social networking site called merimeow.com which not only enables them to connect with their audience over web 2.0 but also, as most Social Networking sites require sign ups and profile entries, these guys get valuable profile information on their target audience. They get to know which dempgraphic listens to meow the most, what's hot, what's happening, what the buzz is and more!! Jeez these guys ARE smart! Infact on checking the site out, I was reminded of another brand that used web 2.0 very very smartly - Sunsilk's Gang Of Girls website.The Meow website has a virtual bazaar that no doubt markets women's products. Soon there will be tie ups with third party companies that cater to cosmetics, soaps etc and meow will end up creating another revenue stream.
A lot of interesting best practices from a radio station that no one took seriously when it first launched and which proved that differentiation is critical for survival. Read the complete article here
Also, I really do not want to say MEOW one more time
Friday, August 1, 2008
Google Killer? Really??
So well, Cuil.com was launched recently amidst much hoopla and was touted by its PR as the "Google Killer" search engine. Well the verdict it out and initial reactions aren't much to go by. I'm being polite, let me say it then, it sucks. But that isn't the point, the point is that it sucks primarily when compared to Google. But, wait a sec, I didn't force the comparison, Cuil itself forced me to do it.When you call your product the killer anything, you are begging people to make comparisons by raising their expectations and if don't particularly meet those expectations and flounder badly, you are going to invite some pretty strong reactions
Well to be honest the tag line caught my fancy and I too tried out the site and the first thing I did was search my name. I was very very disappointed with cuil's results. For a site that claims to index far more sites than google, I was pretty let down with the results. My blog for instance wasn't indexed (and no I'm not berating cuil for that reason). My point is that, this is obviously a big PR snafu. Ofcourse it attracted a lot of people, ofcourse a lot of people searched on it but the upshot of it has been that it has been universally berated. Is the hype worth the negative reaction? The done thing would have been to be slightly discreet, to have gone for a soft launch with rigorous testing of the product without tall claims
The lesson for marketers here is to ensure that there is no disconnect between the marketing hype and the product. Ofcourse we all want our products to sell but nothing is worth the bad press and the public really isn't that forgiving. So next time you make tall claims make sure the product live upto it
More about cuil here
Well to be honest the tag line caught my fancy and I too tried out the site and the first thing I did was search my name. I was very very disappointed with cuil's results. For a site that claims to index far more sites than google, I was pretty let down with the results. My blog for instance wasn't indexed (and no I'm not berating cuil for that reason). My point is that, this is obviously a big PR snafu. Ofcourse it attracted a lot of people, ofcourse a lot of people searched on it but the upshot of it has been that it has been universally berated. Is the hype worth the negative reaction? The done thing would have been to be slightly discreet, to have gone for a soft launch with rigorous testing of the product without tall claims
The lesson for marketers here is to ensure that there is no disconnect between the marketing hype and the product. Ofcourse we all want our products to sell but nothing is worth the bad press and the public really isn't that forgiving. So next time you make tall claims make sure the product live upto it
More about cuil here
Thursday, July 31, 2008
Twitter - Fail Whale Brand Strategy
I like twitter a lot. Its so uncomplicated. If you haven't heard of twitter yet, duuuuuude better catch up! Twitter is essentially a micro-blogging service where people input text to keep their friends or "followers" updated on what's been happening in their lives. Twitter has a character limit of 14o, so its sorta like a MSN/Gtalk status message only with more character limit and which people online can follow
Twitter is cool but more often than not the site seems to be down, particularly when there is heavy usage during an event like Mac world expo etc. Although the site suffers from technical glitches, it still has extremely loyal followers and its popularity is growing day by day. So question, how come web surfers like us who have no patience with technical glitches, still continue to patronise twitter? Answer: Twitter has come across as a community product. Twitter communicates the site unavailibity through a Fail whale graphic and is extremely open about site outages and failures. This honesty is endearing and comes across as genuine. The Fail whale graphic greatly helps in this cause. The image now has a huge fan following online and there's even a mechandize line based on the fail whale image.
The fail whale image above, was created by Yiying Lu and apparently symbolizes a Beluga Whale in distress. A beluga whale is known to utter high pitched twitters. The image of a whale in distress being resucued by birds seems like a quirky, open, honest & endearing way of communicating a problem and this is what I guess, keeps people loyal to twitter, although if the glitches continue unfixed, the user patience might run out.
The message here is to maintain a dialogue with the users about a genuine problem and this in a way fosters transparency and trust in a brand. This is also a great example of how building a community around your brand can help during bad times.
Sunday, July 27, 2008
Rolling with the times
As a marketer it is very important to have a pulse on the mood & sentiments of the market. A message becomes all the more powerful when it comes in context of some mood and hence is all the more powerful. A good example of this is when brands start associating themselves with the festive season. I'm not talking about consumer durables promoting special festive season offers, but of a more powerful variety of messaging such as say Cadburys and Diwali, Coca Cola and Christmas etc. The message is apt because it resonates with the audience completely.
When a product or brand adapts itself to the prevailing mood or sentiment the connection between the brand and the consumer is strengthened. Take for example, the special Date Frappuccino®, that starbucks introduced last Ramazan in the middle east. The date is the fruit of the season during Ramazan in the middle east and when a company comes out with a special edition coffee to commemorate a special festival, the market instantly connects to it and the association with the brand becomes all the more stronger. I mentioned in my last post about MacDonalds giving out Daandiyas with their combos during Navaratra last year. That was more than an instant hit. Acts such as these make the brand less global and more local and helps in building a local level loyalty
But these are annual seasonal trends- these festivities happen every year and one has ample time to incorporate it into the grand master plan for the year, but what unforseen trends? like the oil crisis? or inflation or the energy efficiency drive? all these are macro economic trends that happen suddenly but need to be incorporated into the messaging to reassure the consumer. I'm facing this particular dilemma at work. Thanks to the current macro economic trends ,I'm talking to my audience more in terms of asset utilization and energy efficiency.I didn't expect Oil to breach the $140 mark at the beginning of the year and so didn't plan for it. But inorder to keep up with the times and to send out a more reassuring message, the communication focuses on such aspects and strongly resonates with the current mood. And it works. People react to it more than they would to a more normal sort of messaging.
Take for example the topic of energy efficiency. If your product is remotely energy efficient, now is the time to shout about it from the mountain top because people will pay attention. As purse strings get tighter, the new buzz word is "cost saving". Having such words incorporated in the communication makes it more effective and current.
So anybody else having to restructure communication plans because of the economy?
When a product or brand adapts itself to the prevailing mood or sentiment the connection between the brand and the consumer is strengthened. Take for example, the special Date Frappuccino®, that starbucks introduced last Ramazan in the middle east. The date is the fruit of the season during Ramazan in the middle east and when a company comes out with a special edition coffee to commemorate a special festival, the market instantly connects to it and the association with the brand becomes all the more stronger. I mentioned in my last post about MacDonalds giving out Daandiyas with their combos during Navaratra last year. That was more than an instant hit. Acts such as these make the brand less global and more local and helps in building a local level loyalty
But these are annual seasonal trends- these festivities happen every year and one has ample time to incorporate it into the grand master plan for the year, but what unforseen trends? like the oil crisis? or inflation or the energy efficiency drive? all these are macro economic trends that happen suddenly but need to be incorporated into the messaging to reassure the consumer. I'm facing this particular dilemma at work. Thanks to the current macro economic trends ,I'm talking to my audience more in terms of asset utilization and energy efficiency.I didn't expect Oil to breach the $140 mark at the beginning of the year and so didn't plan for it. But inorder to keep up with the times and to send out a more reassuring message, the communication focuses on such aspects and strongly resonates with the current mood. And it works. People react to it more than they would to a more normal sort of messaging.
Take for example the topic of energy efficiency. If your product is remotely energy efficient, now is the time to shout about it from the mountain top because people will pay attention. As purse strings get tighter, the new buzz word is "cost saving". Having such words incorporated in the communication makes it more effective and current.
So anybody else having to restructure communication plans because of the economy?
Thursday, July 24, 2008
McIdea
I'm often amazed at how McDonalds has this uncanny knack of making me buy what it wants me to buy. As a marketer, in my book, thats a bloody coup. Marketers are generally wont to begin with the matching the cutsomer's expectations. This is what you want, this is how we'll match the need - very rarely do we go on the path of telling the customer what he should have instead, because in our world, the customer is king. But MacDonalds has the gall to tell you what you should have. I'll tell you how
I generally go to MacDonalds to have a quick bite when I'm in a hurry or if I'm not too hungry. I have a set preference - Chicken Mexican Wrap. Always. Unless MacDonalds is running some special offer and then my world goes topsy turvy. The special offers on combo are generally the high priced combos and with them you get a free something that's really attractive and tempting. Right now there's a Fear Factor offer going on and one gets a penknife free with every combo. Now do the math please. Initially I was going to spend Rs 65 but because of the combo offer - Burger+Fries+Coke I pay Rs 117. Thats Rs 52 more than I intend to spend. Now consider that MacDonalds buys these penknifes (If they do that at all!) on large volume discounts from its supplier, so its fair to assume that each costs Rs 10. But since a joint promo is paid for by the company doing the promo - in this case - fear factor, we can negate the Rs 10 that Macdonalds had to shell out. Plus the extra food might be considered at Rs 25 extra. So net profit for MacDonalds from this offer - Rs 27. and thats just me. Multiply this by millions and you know why they call it the Golden Arches.
Sheesh! these buggers (or burgers?) are geniuses. Instead of looking down on cheap fast food. We should be genuflecting in front of these people. I have learnt a big lesson today.MacDonalds has learnt succesfully to tap into the culture of the mileu they operate in. They have low price entry barriers, playing very well in the Indian Psyche of low prices and then they upsell through the combos. The upselling usually takes advantage of the mood of the market. During Diwali, MacDs had a combo offer where they were giving out Daandiyas!!. And these things were literally flying off from the shelves. People were falling over themselves to get one of these. And again I'm sure the profit per person must have been something close to Rs 40. MacDs has been successful because they've adapted themselves to the Indian Psyche. No just talking the language but reflecting the culture in the menu too - Tikki, Tikkas and what not. I hear the they even have an all vegetarian outlet in Ahmedabad. Thats the one lesson MNCs need to learn from MacDs. Adapting the brand to the local culture but yet maintaining the brand identity. Who knows once we perfect this we may we even develop the gall to do what MacDonalds does - Change the customer's mind. I'm sure then we'll be lovin it too!
I generally go to MacDonalds to have a quick bite when I'm in a hurry or if I'm not too hungry. I have a set preference - Chicken Mexican Wrap. Always. Unless MacDonalds is running some special offer and then my world goes topsy turvy. The special offers on combo are generally the high priced combos and with them you get a free something that's really attractive and tempting. Right now there's a Fear Factor offer going on and one gets a penknife free with every combo. Now do the math please. Initially I was going to spend Rs 65 but because of the combo offer - Burger+Fries+Coke I pay Rs 117. Thats Rs 52 more than I intend to spend. Now consider that MacDonalds buys these penknifes (If they do that at all!) on large volume discounts from its supplier, so its fair to assume that each costs Rs 10. But since a joint promo is paid for by the company doing the promo - in this case - fear factor, we can negate the Rs 10 that Macdonalds had to shell out. Plus the extra food might be considered at Rs 25 extra. So net profit for MacDonalds from this offer - Rs 27. and thats just me. Multiply this by millions and you know why they call it the Golden Arches.
Sheesh! these buggers (or burgers?) are geniuses. Instead of looking down on cheap fast food. We should be genuflecting in front of these people. I have learnt a big lesson today.MacDonalds has learnt succesfully to tap into the culture of the mileu they operate in. They have low price entry barriers, playing very well in the Indian Psyche of low prices and then they upsell through the combos. The upselling usually takes advantage of the mood of the market. During Diwali, MacDs had a combo offer where they were giving out Daandiyas!!. And these things were literally flying off from the shelves. People were falling over themselves to get one of these. And again I'm sure the profit per person must have been something close to Rs 40. MacDs has been successful because they've adapted themselves to the Indian Psyche. No just talking the language but reflecting the culture in the menu too - Tikki, Tikkas and what not. I hear the they even have an all vegetarian outlet in Ahmedabad. Thats the one lesson MNCs need to learn from MacDs. Adapting the brand to the local culture but yet maintaining the brand identity. Who knows once we perfect this we may we even develop the gall to do what MacDonalds does - Change the customer's mind. I'm sure then we'll be lovin it too!
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