Saturday, May 22, 2010

Who are You ?

The Topic sounds almost insulting.
I speak in the realm of retail but this topic is equally relevant to any product or service. It is not new, but it is given little attention, or rather as much attention as may be needed. Let me cut to the chase.
It is POSITIONING I am referring to.
Wikipedia has a good note on this topic
http://en.wikipedia.org/wiki/Positioning_(marketing)
Having been around in the retail scene for a while, I have seen attempts at serious Modern Trade Retailing in grocery by large Indian corporates. In all cases I have seen that senior leadership have lacked clarity of thought about "what are you", and  what  they want the retail outlet to be. Positioning is the most significant one pager that the senior leadership must "literally write", laminate, and distribute to anyone who has anything to do with decision making in the company. This clarifies at a high level the identity of the retail outlet.

To write the Positioning statement needs Clarity on the following necessarily in this order:
  1. Vision of the Promoter. Lets not fool ourselves. It is the one who spends who calls the shots! I may choose for some or any reason, that I want to be a Gourmet Food retailer (high end value added foods), or someone else decides that they find Mass retailing to be the market they want to play in. It also gives a peek into the mind of the promoters of their risk appetite and expectation of the horizon of investment pay back. Having an endless tranche of cash flow also does not guarantee success in Indian retailing. Learn from Sam Walton and the subsequent CEOs after him in 1996. He never ever since he started nor to this day had any confusion of "who are you", he is the ultimate mass retailer - Pile high let Fly.
  2. Who are we talking to?  Clarity from 1. above then begs the question - "if I know what I want, then who is my target Audience?" A mass low price retailer setting up average quality merchandise in Causeway Mumbai, or Malabar hill, or Vasant Vihar in Delhi or Boat Club road in Chennai, is in the wrong place with the wrong concept.
  3. What do we sell to them? Clarity from 2. above forces category managers to understand and look for merchandise that suits the price, quality, and range requirements of the target Consumer. Need i say more? Well i need to say a lot more. I am not sure how many senior category heads in this county will pass the test of writing a category plan. Do they understand what CDT means, Mind Mapping, Assortment and Promotion efficacy? If they don't pass this test then they are the captain of the Titanic!
  4. How do I serve them? Clarity from 2. and 3. above will tell you what kind of outlet will be suitable for the consumer - glitzy, funky or functional? What kind of outlet might sell Disney products of MTV memorabilia, and what kind onions? I had seen a gourmet outlet in HongKong called Great - with truly high end food (the only gourmet worth its definition, to some extent Jaisons in Singapore).
  5. What else do I need to know? Clarity from 3. above raises many new questions- how do i get products to them- supply chain, promotions philosophy, visual merchandising, etc.
Positioning, as you can see, is the core to everything. Even for individuals at the age of 47 it is not too late to try to rediscover your calling and competence (corrected after Ninad's comment, below). But Early in life we must understand we must study and work for gaining Competence, and Capability. And this comes only from direct hands on experience. What is your Positioning? Write down the things you are good at, and that can make a difference to the people around you or to the company you work in. Don't be a John Doe! 

5 comments:

  1. This is a must read article for all in the retail trade. Radha you have beautifully articulated something that corporates tend to forget while starting their business. Retail is so vast that people want to do everything together - mass and class.

    The challenge really is that the customer cannot put a face to you - a brand to your stores. Do they come to you because of price, or assortment, or classy stuff? If they are confused, they go to competition. Following Future Group and seeing its formats evolve has been interesting. Low price brands are 'Bazaar' and mid price brands are non 'Bazar' - Pantaloons, Home Town etc.Maybe that's a way to go for large corporates.

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  2. Yes the mindset of catering to everyone eventually makes you loose the focus on what you are offering. I also saw tendency to launch products and grow sales by offering huge discounts (buy 1 get 1 free) even on premium category product. Initially the product has appeal for consumer looking for discounts and when scheme is over product looses even these customers and fits in no category.

    Horse Sense by Al Ries and Jack Trout is a wonderful read on positioning.

    Radha Its never late to do anything. Just read Mr Nair set up his first Leela Hotel at the age of 65.

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  4. Basab.Agree.What i am amazed at, is the fact that all these companies are full of blue-blood marketing honchos, who should redefine retail-marketing as a subject.Instead retail marketing is just literally "poster-boys" doing Catalogues and leaflets and press ads. Protecting the positioning must be mandate of the Investor/Promoter/CEO/Board.
    Ninad. yes the book you have refered is essential reading. I know how steadfast you are with the products you make. It will surely bear fruit(pun intended)!

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  5. Sir ,

    With due Respect to everyone , senior managment cannot be present , the only core guideline for anyone in Retail is to work for Consumer only , Sales & Profits will follow automatically if consumers are taken Care & today in most of the retail chains the attention towards customers is lacking , that's the reason why stand alone stores are doing much better bussiness than Modern trade .

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