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Marketing Wizard | October 2013

Turn the confused buyer into an educated consumer.

CV Rajesh, Assistant Vice President (Marketing Support) Chettinad Cement.

Chettinad Cement, established in 1962, is one of the leading manufacturers of cement and construction materials in south India. Under its Builders Choice brand name, Chettinad Cement offers an extensive range of bagged products that includes ordinary Portland cements and blended cements to suit most building and construction applications. CV Rajesh, Assistant Vice President (Marketing Support), gives an insight into the philosophy behind the successful brand building practice at Chettinad cement. Excerpts from the interview.

What is the thought process that goes into the preparation of your media plan?
Cement industry today is highly competitive, with supply far exceeding the demand. This highlights the need of having a pull created from the market as any amount of push strategy may not really yield the desired results. The media vehicles used thus should be highly structured, cost-effective and allow the desired spread and penetration. Choosing the right media mix will help the brand reach the target mass.

What are the challenges you see in the market?
In terms of sales, low demand vis-a-vis heavy supply accompanied with more new players and capacity additions is the stiffest challenge. The economic growth has been sluggish over the last few years and cement being part of the core industry depends a lot on the economic growth. To deal with this, one has to know the pulse of the market very well and must be attentive to any fluctuations in the market. Marketing strategy based on keen observations plays a pivotal role in the challenging scenario. Not only should the strategy be practical and based on solid ground level facts, it should be well aligned with the market scenario and must be structured to allow flexibility to change. Markets are dynamic and so should be the strategy. A contingency plan (Plan B) has also become the order of the day, as predicting market trends is very challenging.

Soaring raw material prices have forced cement prices up. How can one entice consumers to shell out extra for the product?
Enticing really does not happen since today`s consumer has limitless options to choose from in terms of both price and product type. He or she has a whole world of products to choose from let alone the substitutes for them. In-fact, the wide range available, often leaves the consumer confused. The buying process gets delayed as the consumer has to put in efforts for understanding the pros and cons of each option. The best way to approach is to first properly understand the need of the consumer and the utility of the product. One must investigate how the attributes of the product will provide for the need of the consumer. This understanding will help you in developing your own USP. Once that is done, you can initiate a transparent and focused campaign. The USP can be precisely communicated and strongly emphasised in few words. This will turn the confused buyer into an educated consumer. Once he or she understands that there is value for money and his or her need is met, the product gets sold at your price.

Which is a better strategy, distributing through few large dealers or routing via an extensive network of small dealer outlets?
It really depends on the dynamics of your marketing process. The whole-sale route will make your product available to several outlets in a short period. However, there is a risk of being too dependent on few big consumers. It is like having too many eggs in one basket. If something goes wrong in your relationship with the dealer and the company swings, the product movement through that channel will come to a halt. In the case of retail marketing, your market base is quite wide and the risk is well spread-out. One or two hiccups with any of the retailers will not have a huge impact on the business. However, developing an extensive dealer network is a highly time-consuming process.

The network building process will have cycles of selecting, working with, and eliminating non-productive collaborations. The cycle will repeat with every new dealer. In short, if you have sufficient time, adequate field force and temperament, then retail marketing is a good option. Otherwise, the wholesale route is more productive.

Cement is seen more as a commodity than as a specialised product. In such a scenario, how do you create brand differentiation and stand apart from the rest?
In our earlier days of field sales, we were told that cement is an engineering product and is in the transition stage and so is being sold as a commodity. But the transition is getting longer. The real advantage of cement is that it has no substitute.

This turns the situation in to a cakewalk for identifying, advertising and selling a product. However, the current market scenario of excess supply has turned it into a commodity product. As described earlier we follow the customer-oriented approach. The brand is positioned in the right slot of price, made available across all places and is delivered as a quality product backed-up with right promotion.

This makes the consumers appreciate the product and gives them confidence about getting value for their money. This is not a one-time exercise, but is done repeatedly to suit the changing marketing trend. While the widely acknowledged 4 P strategy is applicable more for products than for commodities, cement industry generally follows it.

How do you reach construction professionals ranging from civil engineers and consultants to contractors and masons at different levels?
Contact meets are conducted for all sets of influencers like architects, engineers, contractors and masons. The field force tries and keeps a good association with them even after the meet. Technical seminars and presentations are also done in the various meets conducted under the aegis of associations.

Advertisements in related periodicals, monthly magazines, etc, are given to improve brand retention. We also participate in important exhibitions related to our industry. We have developed a unique data bank which is effectively used to strengthen the bonding.

Quality perception of cement varies from customer to customer. How do you factor this in your marketing plans?
Quality of the product is mainly assigned to the various physical properties of the cement like one-day strength setting-time, etc. We have identified USP of our products and are using the tagline: 5 Stars Cement รป for strength and durability.

The five stars representing Quality, Strength, Durability, Colour and Service, constitute the key variants that promises the desired deliverables to the customer. We, in all our campaigns, highlight this tagline, which has been well appreciated by the customer since each of these elements are very important and are offered with utmost precision.

Other than price and quality, which other factors influence buying decisions?
Availability of the product at the nearest counter plays a vital role in the buying decision. The preference of the technical expert is another contributor to the decision- making process as purchase of cement is a technical process and one usually relies on the opinion of the influencer. Promotion channels like outdoor publicity improve the brand recall and help the product to be listed in the consideration set of the consumer.

What are your current marketing plans / initiatives for promoting your products?
We have split our entire activity into two verticals branding and market support. The former addresses the masses in general and the latter specifically caters to the trade. In branding, we advertise both through the stationary and mobile media.

We have gone in depth on formulating the marketing plan for each state. The state plan is then bifurcated to regional and zonal levels and initiatives are tailor-made to suit the branding desire of the local market so as to get the best mileage and have the product placed in the right slot. We firmly believe that the brand equity thus created shall be consistent and must be in line with the corporate plan.

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