VOL-1 ISSUE 2 APRIL 2013 `250 I I I

MARKETING BOOSTER

Luxe Reduxby The Boston Consulting Group

Luxury across the Pyramidby Jessie Paul

SpotlightPhilipp von Sahr, BMW Group India

MasterCard : “Evolution of Priceless”

What is Luxury? by Dr. Isaac Mostovicz

In ConversationKaran Ahluwalia, YES BANK

View From the Top Ruchita Sharma, Swarovski India.

SAP Case Study : Luxottica

The Great Indian Marketing Summit - Realty Edition (21 June, 2013)

THE MIDAS TOUCHluxury special

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Sujatha V Kumar

Category Director-Marketing

Coca-Cola India

Meghana Saboo

Sr. Manager - Marketing and Corporate Communications

L&T Integrated Engineering Services

Purnima Menon

SVP& CMO

CSS Corp

Lulu Raghavan

Managing Director

Landor Associates

Just received the copy of the first

issue of the Marketing

Booster…thanks for the same! It was

a very interesting read.

Received your Marketing Booster –

great magazine, good read.

Good edition of Marketing

Booster. Cheers to more!

Great initiative and

interesting content.

Yo! Say the word luxury, and immediately it conjures up images of champagne, expensive hotels, couture fashion, and handmade bags. But it's a word which means different things to different people. For some, running water is a luxury. For others it could be a roof over their head. And for others it is a road fit to drive their snazzy sports cars. Or the perfect cup of tea.

But whatever it means to you, you are willing to pay a premium for it. This is what makes the topic of luxury so exciting to a marketer - the ability to identify something that is of great value to the customer, deliver it, and collect a premium. It cuts across income groups and product categories providing an opportunity for every marketer to define and monetize a niche. This, the second issue of our monthly magazine, is dedicated to exploring luxury from different perspectives. We invited a wide spectrum of marketers and academics to share their views on what they think is luxury and how it can be marketed and are happy to share this with you.

This issue, on luxury, leads us to the next one which will be on real estate marketing. That's aligned with our forthcoming national conference on real estate marketing to be held in Bangalore on June 21st at The Leela, Bangalore. Why real estate? Because it is something that almost every Indian is involved with in some fashion - home ownership is still a major aspiration and one of the largest investments a person makes in their lifetime. It is also a relatively new category in the organized sector and the challenges of marketing a high value product which will be delivered years after the initial payment are many. Apart from self-consumption, the product is often used as an investment and is often purchased by non-residents - further adding to the complexity of the marketing program.

We've had great feedback for the previous issue - thank you, dear readers. Do stay in touch with us - we see this magazine as a means to share best practices among the senior marketing community in India, and it would only be successful when it is truly interactive.

editor’s note3

Happy reading!

Jessie PaulCEO, Paul Writerjessie@paulwriterconnect.com

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perspectives on luxury:

How does marketing a luxury product vary from that of regular products?

Everything about marketing a luxury product would have to be in line with the definition of a luxury product, the channels, events and ambassadors all have to exceed the purpose of association with the brand, have to be seen as high quality - be it top of the charts, success or affluence. It would be significantly expensive and participation is by invitation and aspirational. It would also be relevant to state the obvious that genuine luxury

products marketing would be absent where regular products thrive.

What do you think defines a “luxury” medical experience?

Relating luxury to healthcare as per the above definition would be completely inappropriate. In healthcare, we should focus on “BEST Experience” and not a luxury experience. I would thus define the best treatment as one that is truly “7 Star” across the care continuum.

At Apollo this starts with:Ÿclinical outcomes - read success rates - that are globally on top (disproportionately better than global sector averages)Ÿpatient experience that ensures utmost quality of care (TLC all the way)Ÿthe Infrastructure (clearly exceeds purpose)Ÿthe use of the latest technologies (enables enhancement of quality and outcomes)Ÿclinical expertise (the best minds and experience)Ÿholistic care from wellness, prevention, intervention and rehabilitation

All this apart from an overarching focus on processes and standards of care. All contributing to value delivery. Clearly not an example of the cost: price ratio

Any recent luxury marketing campaigns that have impressed you?

None in the recent past, but would rate the Rolls-Royce campaign of Ogilvy….“ At 60 Miles an hour the loudest noise in this new Rolls-Royce comes from the Electric Clock". Truly this was aligned to my personal definition of Luxury i.e. exceeds purpose, promises quality, Cost: Price equation aligned and clearly emotionally aspirational.

S Prem Kumar-Group CEOApollo Hospitals

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perspectives on luxury:

How does loyalty for a luxury product vary from that of regular products? Any brand essentially delivers functional benefits which are tangible, and emotional benefits which are intangible. In the case of luxury products, the non-tangible benefits form a higher part of the value than the tangible benefits.

There are a few key points that are extremely crucial for loyalty marketing for luxury brands

1. Perception Management is critical among the target audience. The brand needs to be seen as being "in" by the image-makers and early adopters2. The brand needs more constant image upgradation and word of mouth is a big lever in building loyalty3. Since the consumer-set buying these brands are global in their outlook, global incidents concerning the brand have a bigger impact than in the case of normal brands What do you think defines a “luxury” loyalty experience? A few rules:

1. Something that is not available on the shelf for everyone. It is exclusive, the qualification for the experience itself is a benefit that one can talk about2. The experience needs to be customized for the individual. For example, if someone likes Darjeeling tea every time one checks into a 5 star hotel then the hotel better make sure they do not have only lemon tea packets in his room3. Price is typically a minor factor in the whole mix - the user experience is key4. It is about surpassing expectations not meeting them so that one can generate a very positive word- of-mouth

Which is your favorite luxury product? I am not into luxury products all that much, but a Tag Heuer watch that my wife had bought me for my birthday a few years back will always be very special. Any recent luxury marketing campaigns that have impressed you? One campaign I have always liked is the Tag Heuer. It has used celebrities very smartly to drive awareness for the brand whether its Shahrukh Khan or more recently Cameron Diaz. At the same time, the product is the hero in the ad and it manages to create "desirability" for the brand which is critical. Price doesn't feature in the communication. They have used PR and events very smartly too with Shahrukh Khan actually wearing a Tag. And unlike some of the ads he does for a men's vest brand you know he actually uses the product and is not just endorsing it!

Rathin LahiriCMOLoyalty One

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How do you define social business?

We define it as the art of business collaboration, using digital tools and techniques that enable individuals across silos, organizations and industries to work together to share insights and tackle thorny business challenges. Not everyone gets this, so our view is that we are building this platform for younger and up-and-coming business leaders who can hopefully model more collaborative and transparent social business behaviors for the rest of the community.

What are some of the ways, if any, that you as the Community Leader have integrated offline and online activities in support of your customers?

Cognizant Connections is a perfect extension of our physical world meetings, enabling pre-, mid-, and post-event exchanges of knowledge and informational needs. We have used special interest groups to gauge interest in events, call for speakers and get feedback on materials presented at our events. In fact, these are the groups where we tend to have the most engaged and active users. I guess Cognizant Connections, when combined with real-world meet and greets, is the most effective way to build esprit de corps!

Are there any other ways you use the data or insights surfaced through community to impact / inform core ops?

We do use an assortment of web analytics to highlight content areas that are most fertile. This helps us to see where we should focus our thought leadership development efforts. The community also acts as a sounding board for trends and PoVs that we want to share with a broader audience. The results may not totally influence business decisions, but they provide an important input for figuring out client/prospect sentiment.

What do you think are the biggest benefits of community for Cognizant? Why do you do it?

As I tell all of our senior execs — we are building this community for the next generation of business leaders. More important, Cognizant Connections enables us to create more transparent and real-time ways to work with and share insights with clients. It is an important investment, particularly if we want to reinforce that we are a company they can count on to build more digitally collaborative ways of working across silos and industries.

Do you have any advice or lessons learned for other B2B companies seeking to build an online community to service their customers?

Suggest you let your targeted audience lead you initially, but do not despair if they do not know what they want. There's a lot of trial and error involved; no organization has gotten it totally right. It's a two-parts experimentation, one part perspiration formula. Keep trying new things; if user blogs aren't your members' cup of tea, get rid of them. Seek ways for members to connect and participate at the level that makes them most comfortable. Also, remember most networking usually takes place at a level that is invisible to the community operator/sponsor, so don't fret if you don't see members exploiting the connections they make within your community by commenting on blogs and discussion areas. It is happening in the physical world, on the phone, via private email, etc. Therefore, make sure to connect members through physical world meet and greets, if possible. It enables members to further develop virtual relationships established in your e-community.

Leader Networks, a research and strategy consulting company that helps large organizations succeed in social business and B2B online community building

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