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Marketing needs innovation, too

THE QUALITY CONUNDRUM

Surinder Kapur  |  New Delhi 

Surinder Kapur
How Indian Industry is managing quality.

I t goes without saying that innovation in various aspects of business is a must-have today. In some of my previous articles, I have emphasised the need in business processes, products, human resource and supply chain.

Another important area for innovation is marketing. For sustained performance, you need to look beyond the surface competitiveness of profitability, quality and delivery. You require a holistic approach to the market and its unexpressed needs.

Innovative marketing schemes are as critical to a manufacturing company as they are to, say, a service company. To come up with innovative schemes, a company needs to have a deeper understanding of its customer, the market and competition.

Globally, the automobile industry has achieved a high level of competence in this area. In India, Maruti Suzuki is a good example of an innovative automobile company "" which is evident from the fact that despite tough competition, the company holds more than 50 per cent marketshare.

Year after year, Maruti has come up with innovative schemes that have helped it increase marketshare. For instance, its "Wheels of India" scheme, targeted at state government employees across all states, led to sales of over 5,000 units.

A special scheme, "Ghar ghar mein Maruti: Mera sapna meri Maruti", targeted at Panchayat members, who enjoy influential and respected positions in rural society, helped increase sales by another 16,600 units.

On the product development front, the company launched a scheme called "Lalkaar", which encouraged employees to sell what they produce.

The result was not just an increased marketshare, but also a direct interaction between the line staff and the end customer. The line staff earned keen insights into what the customer demanded.

This was yet another innovative way of bringing the shopfloor closer to the customer, while increasing the marketshare.

Here, I would like to emphasise the role of the CEO in driving innovation in the organisation. Generally, only the CEO enjoys an overall perspective of the organisation. For instance, a number of factors provided the push for the Lalkaar scheme.

Besides, bringing the shopfloor workers closer to the customer and engaging every employee in the sales process, the scheme also helped the company thwart the impact of rising interest rates. Customers who had been deferring their purchase decisions were provided information about future market trends, thus helping the buying decision.

You need to be innovative even in engaging channel partners such as vendors, dealers, finance, insurance partners and their employees. Here again, Maruti has been successful. With specific schemes focused on channel partners and their employees, it has not only managed to enhance its marketshare, but also helped them with employee retention.

The company has focused on specific customer segments, offering them special treatment and in the process capturing the market. Innovative schemes such "Steel wheels" for the steel industry, "1st class offer" for employees of the Indian Railways, the "Teacher plus" scheme for school teachers, schemes for power sector employees and students graduating from B-schools are all examples of innovative marketing.

These involve studying the invisible needs of the customer, which go beyond the desire to own a car, and arriving at a special, customised scheme. The scheme is rolled out with a complete customer focus.

The organisation sends out emails and circulars to "spread the word"; posters and banners adorn the location offices to transform it into an event; the hype created helps build peer pressure; and the test vehicles add to the desire to own the product.

Clearly, innovation is not only for products, the manufacturing process and business models, but is also required in marketing. Obviously, Maruti has studied customer profiles, stratified market data, and then found innovative ways of successfully addressing smaller sections of the market.

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First Published: Tue, December 11 2007. 00:00 IST
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