Sales vs Marketing

Selling starts only when you have a product. Marketing starts before a product exists. Marketing is the homework your company does to figure out what people need and what your company should offer. Marketing determines how to launch, price, distribute, and promote your product/service offerings to the marketplace. Marketing then monitors the results and improves the offering over time. Marketing also decides if and when to end an offering. Peter Drucker held that “the aim of marketing is to make selling superfluous.”

“If you leave us our money, our buildings and our brands but take away our people, the company will fail. But if you take away our money, our buildings and our brands but leave us our people, we can rebuild the whole thing in less than a decade.” Procter & Gamble CEO Richard R Dupree 1947

raone cost 125 crores .. marketing 50 crores

Stephen
Leacock, humorist and educator, took a cynical view of advertising: “Advertising may be described as the science of arresting the human intelligence long enough to get money from it.” Companies should ask this question before using advertising:
Would advertising create more satisfied clients than if our company spent the same money on making a better product, improving company service, or creating stronger brand experiences? I wish that companies would spend more money and time on designing an exceptional product, and less on trying to psychologically manipulate perceptions through expensive advertising campaigns. The better the product, the less that has to be spent advertising it. The best advertising is done by your satisfied customers. The stronger your customer loyalty, the less you have to spend on advertising.

The ad’s mission can be one of four: to inform, persuade, remind, or reinforce a purchase decision.

ecommerce death of retail ?

http://www.economist.com/news/briefing/21581755-retailers-rich-world-are-suffering-people-buy-more-things-online-they-are-finding

Many brands still think shops are the best way to attract customers. Inditex of Spain, owner of the ubiquitous Zara fashion brand, opened 482 stores in 2012, bringing its total to 6,009 in 86 countries. Primark, a fast-growing vendor of nearly disposable clothing, sells nothing on its website, relying on its 242 shops for almost all its sales. The same can hold at the luxury end, too—few will buy a $10,000 necklace online, or entrust it to the post. Space on the snazziest streets in London, Paris and New York is in such demand that luxury retailers pay millions in “key money” to secure it, says Mark Burlton of Cushman & Wakefield, a property company.

Rural Mktg

HUL shaktiamma changing with the times - equipped with smartphones
Shakti initiatives driving 20% of Unilever sales in rural

Vodafone mini stores in rural india - laal dukaan

Bajaj electricals - mera gaon mera desh economy brand

cavincare - chik sachets

Why rural community is different:
1. CUG
2. Scarcity of media bandwidth
3. slow to adapt brands, slow to give up brands
4. expenses year long, income seasonal
5. entertainment starved, edutainment
6. experience advertising

HUL project Telecalling in Urban India ; Columbus in Rural India

HUL khushiyon ki doli

CSR companies Bill

 See more at: http://indiacp.blogspot.in/2013/01/CSR-Companies-Bill-2012.html#sthash.ePqbmDHv.dpuf
http://www.thehindubusinessline.com/opinion/columns/aarati-krishnan/why-csr-isnt-enough/article5012683.ece

The Companies Bill, 2012 intends to inculcate the philosophy of CSR among Indian companies.

STIPULATIONS OF THE COMPANIES BILL, 2012

Every company with net worth of Rs 500 crore or more, or turnover of Rs 1,000 crore or more or a net profit of Rs 5 crore or more during any financial year to constitute a CSR Committee of the Board consisting of three or more directors, of which at least one director shall be an independent director. 
The Board’s report to disclose the composition of the CSR Committee. 
The main functions of the CSR Committee are to:
Formulate and recommend to the board, a CSR policy indicating the activity or activities to be undertaken by the company as specified in Schedule VII of the Act; 
Recommend the amount to be spent on these activities; and 
Monitor the company's CSR policy periodically. 

If a company fails to provide or spend such amount, Board to specify reasons in its report for that failure.  Companies required to comply with CSR shall give additional Information by way of notes to the Statement of Profit and Loss about the aggregate expenditure on CSR activities. 


Schedule VII of the Companies Bill 2012 prescribes activities that may be included by companies in their CSR policies:
Eradicating extreme hunger and poverty; 
Promotion of education; 
Promoting gender equality and empowering women 
Reducing child mortality and improving maternal health; 
Combating human immunodeficiency virus, acquired immune deficiency syndrome, malaria and other diseases; 
Ensuring environmental sustainability; 
Employment enhancing vocational skills; 
Social business projects; 
Contribution to the Prime Minister's National Relief Fund or any other fund set up by the Central Government or the State Governments for socioeconomic development and relief and funds for the welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women;

Significantly, there is no penalty for defaulting on CSR norms. Only an explanation is to be given by the board in its report for such non-compliance. So, it seems there is no real coercive factor. 


HUL 23000 Rs Crore
PAT 2600 RS crore

SIMPLE ECONOMICS

But my objection to the CSR provision is more basic. It is that it takes a blinkered view of the social responsibilities of an enterprise.

Any company is bound to have constant dealings with multiple sections of society as it goes about conducting its everyday business. It interacts with the local area where it operates its facility, the lenders who fund it, the employees who work for it and the exchequer which collects taxes.

If a company is fair in its dealings with all these entities, there is scarcely any need for it to make a song and dance about CSR. But if it short-changes these entities through questionable practices, this can’t be remedied by paying lip-service to CSR.

SOCIAL RESPONSIBILITY

This argument is based on simple economics. A typical listed company in India spends 30-40 per cent of its revenues on buying materials from suppliers and 11-12 per cent on employee benefits. It also pays out about 20 per cent of its profits as interest and over 30 per cent as taxes to the government.

In contrast, the amount to be earmarked for CSR is a mere 2 per cent of profits.

So if policymakers are really keen to imbue corporate India with a sense of social responsibility, the effort needs to go beyond the 2 per cent clause.

The following checklist can help gauge if a firm is indeed socially responsible in the holistic sense of the term.

Does the core business carry a social cost?

Scanning the annual reports of listed companies, it is clear that those with a questionable core business devote the most space to extolling their CSR efforts.

Thus, we have tobacco majors spending millions on establishing a rural supply chain, companies manufacturing dated chemical compounds taking pride in their verdant campus and fizzy drink makers announcing that they are ‘water positive’.

Within these businesses, no doubt, firms that take such initiatives are better than their peers which don’t.

But wouldn’t it be far more desirable to discourage, at the very outset, businesses that carry a high social cost?

This would call for a system of CSR credits, akin to the one prevailing for carbon credits, that awards negative marks to businesses that manufacture ‘de-merit’ goods. Does the firm care about employee rights?

It isn’t enough if the business chosen by an entrepreneur is squeaky clean. How it is run is equally important.

The last couple of years have seen quite a few episodes of industrial unrest erupt at manufacturing facilities managed by leading companies. These have brought to light several murky practices employed by some manufacturing companies to keep their production lines chugging, even as they cut corners on costs.

Using temporary arrangements to keep legitimate workers off the payroll, paying them salaries that blatantly violate minimum wage rules and using loopholes that deny them of basic legal rights — quite a few members of India Inc seem to adopt these practices to sidestep the country’s labour laws.

If a company acquits itself badly on the above counts, does it really help the social cause if it then goes on to build schools or sanitary facilities in the rural hinterland?

Does it pay its dues?

Talk to the CEO of any small or medium enterprise in India and she will usually have a litany of woes to relate about how the large firm that she supplies to makes life difficult for her. Inordinate delays in payments of dues for supply of goods or services, wafer-thin margins and one-sided contracts that barely allow survival, are all par for course for SMEs dealing with their more powerful corporate buyers.

This is indeed why listed companies were earlier mandated to make explicit disclosures, in their annual reports, of large outstanding dues to SMEs. These disclosures have now been waived. But why not count delayed payments to SME suppliers as a black mark against social responsibility?

Does it evade lenders or the taxman?

Firms often forget this. But the bank borrowings which keep the wheels of a business turning and the taxes collected by the exchequer involve large amounts of public money.

However, it has become quite commonplace in recent years to see large firms lead their lenders on a merry dance to recover their dues. Taking recourse to innovative ‘structures’ that help escape one’s legitimate share of taxes, is practically a matter of pride for the Indian businessman.

So what’s the point in actively cheating the exchequer out of a 30 per cent share of profits by evading taxes and then shelling out a paltry 2 per cent as CSR? All the above instances suggest that as policymakers sit down to frame the rules for operationalising the CSR clause in the new Companies Bill, they should actively consider a system of ‘CSR credits’ that evaluates a company’s social responsibility, in its entirety. While awarding ‘credits’ to companies that do deploy 2 per cent of their profits on CSR, it should also incorporate negative marks for being in an undesirable business or sharp practices in dealings with suppliers, employees and the exchequer.

Establishing a disclosure framework for all this may not be too difficult, as the top listed companies are already required to address many of these issues in the new Business Responsibility Report.

A report card on these lines may prompt the leading lights of corporate India to take their social responsibilities more seriously. And it may also help silence the cynics who ask if a profit-oriented enterprise can really do well, if it expends its profits on doing good.

Street smartness

http://www.realworlddegree.com/street-smart-vs-book-smart/

What is street smart?

Well, when I think of street smarts I think of someone who has good common sense and is intelligent, but isn’t necessarily doing well academically. This person gets his or her knowledge from try and error, from talking to people and exchanging thoughts and opinions. He/she is more of a doer than a crammer.

The Oxford dictionary describes “street smarts” as:

the skills and knowledge necessary for dealing with modern urban life

The term street smart is often used to compare and contrast another term called “book smart”.

And what is book smart?

The stereotype of a book smart person is someone who is very well educated, who is a gobbler of books and tries to understand complicated theoretical principles. But this person might have troubles interacting with people or putting his academic knowledge into real world practice.

College graduates have advantages

In general it is true, college graduates who I would consider as book smart have better chances of well paid jobs. Their starting salary is mostly higher.

In a world where you get valued by “little numbers and letters”, where you primarily get a job through handing in a sheet of paper called resume, it is tough without academic qualifications.

There are many professions that actually require extended education – lawyers, doctors or university professors. You wouldn’t want a school dropout to perform your life saving surgery, would you?

But graduating from college doesn’t give you a free pass to a successful career.

The irony of college

Isn’t college supposed to prepare you for a successful career?

You were taught by your parents and teachers that if you study hard enough you will get a successful well paid job as a reward. That’s not necessarily true.

There are people who totally succeed in school and at college but fail in their professional careers. And those who fail in academic institutions might be the ones joining tomorrow’s most influential entrepreneurs.

What makes the difference?

 Key success skills

Whether or not you’re book or street smart to become successful you should first of all define what success means to you. Defining your personal level of success will give you enormous power.

• What kind of job are you looking for? Do you want to be employed, a freelancer, entrepreneur or CEO?
• Do you want to earn big money, follow your passion or combine both?
• Are you willing to work hard for your goals or do you aim for a work life balance?

And to climb the ladder of success you need certain skills and traits regardless of you’ve graduated or not.

Very important are marketing and sales skills. Even if you never intend to become a sales person you will always always end up selling something. Even if you want to become a hairdresser and earn money with it you need to sell your services. And to attract customers you need to market your brand. Period.

Soft skills are essential as well. In your career you always need to interact with people. People as your customers, business partners, clients. You rely on great communication skills - both oral and written.

To become successful you need to network. Networking opens many doors. Sometimes it is more important who you know than what you know.

A fundamental understanding of finances is important too. As soon as money comes in you should be able to make smart decisions with it.

And of course with a right mindset, self-belief, motivation, enormous work ethic, a positive attitude and driving goals you can get anywhere you like.

You don’t learn it at university

Most commonly you don’t learn these skills in college. Tertiary education is, like school, rather based on memorising facts to pass the next exam than practising soft skills or learning how to network efficiently.

That’s why it’s so important to engage oneself in learning more about these skillseven after college. Read books of your choice, listen to audiobooks (my favourite while being on the road), watch tutorials on Youtube, browse through the web, attend seminars…there are so many options.

Learning is a life long journey! And can be super exciting!

So, which smart is the smarter one?

Bottom line is it is great to be well educated alias book smart. But only to a certain level namely as much as you really need on a regular basis. To gain knowledge beyond that is a waste of your resources.

You need merely a little of what you learned in four years of college yet you “spend almost [your] entire youth – potentially some of the most creative, enthusiastic, energetic, and fun years of [your life] – in pursuit of little numbers and letters certifying [your] academic intelligence” (“The Education of Millionaires” by Michael Ellsberg).

In order to really succeed you’ll need skills like mentioned above. However you don’t learn these skills in college.

What makes then more sense for many jobs is to get the theory by self-education and thus will save money and time and instead focus more on key success skills which are a necessity for most successful careers.

The leaders and entrepreneurs of today’s world

Some of the most successful leaders and entrepreneurs of today’s world prove that you can skip that part of attending college. They are school and college dropouts, who may be less book smart, but who certainly are street smart!

Just think of Steve Jobs, Bill Gates or Mark Zuckerberg, who are part of a revolutionary technology era. Lady Gaga and Alicia Keys dropped out of college to pursue their passion to music. Jay-Z never attended college and put it this way: “I’m a thinker. I figure things out. I don’t have a high level of education, but I’m practical–and I have great instincts.”

And the list goes on…

How much is innovation related to brand relevance in established brands.

If you ask enough people what a brand is some will say it's a logo or a product, some will say a mark of quality, or a promise of an experience. Eventually, if you dig deep enough, people start to talk about a set of values, or even a belief system. A logo and a product are only the tip of the iceberg—what lies beneath all brands is a vision and a degree of faith in that vision.

Jean Noel Kapferer puts it in his book Strategic Brand Management: "Brands are rejuvenated by new products matching new needs, not by advertising."

Häagen-Dazs and Ben & Jerry's grew the luxury, adult ice-cream category by investing heavily ahead of the curve. Kellogg's launched Nutrigrain to bring us breakfast in a bar. Red Bull and Gatorade brought us energy drinks. So the question is, if brands can claim category ownership through innovation, why don't we see established brands innovating more successfully?'

Well the short answer is that innovation is easy when all you have is faith. Once you have a successful business with real profits, developing new competencies is risky and expensive. It takes a long time, drains resources away from the core business, and risks the brand's reputation.

incremental changes. steve jobs rejected all 1000 ideas and got only 3 ideas working on

Leap before u look

http://37signals.com/svn/posts/1498-leap-before-you-look

Makes you wonder: How many others have succeeded because they didn’t know the rules? Because they didn’t realize that they were doing things they weren’t supposed to be doing?

We’re always taught to look before we leap, but it’s interesting to hear about the Segals of the world — those who succeed by rushing forward without thinking.

But doesn’t wisdom lead to success? Sure, it often does. But sometimes the winners are those who don’t have a lot of wisdom. 

Narendra modi sanand

Don’t lose out on opportunities

An opportunity often comes your way and by waiting for too long, it will pass you by. This could mean missing out on for example a lucrative business opportunity or a potential date.

So learn to weigh up what’s in front of you and then go for it.

At the same time, this doesn’t mean you throw all caution to the wind. Do some quick risk analysis as appropriate, but do not let that become a reason to hold back either