Thursday, August 26, 2010

Out Of Home but not Out Of Sight

Don’t worry I am not going to share stalking techniques through this post. Rather through this blog, I will try to break the monotony of topics based on finance and social issues. I will try to share my learnings from one of the projects I did with an FMCG major. It came under the ambit of Sales and Distribution.

Some if not all of us must have noticed that right from the time we wake up and till we finally go to bed, consumer products especially FMCG ones touch us on various occasions be it while bathing, eating, shaving etc. But the plethora of options available to you at the nearby retail stores would have given you a fair indication that there is a lot of competition in this sector. So firms are looking at different ways through which they can reach out to their customers at different places and at different times. This is where the concept of OOH or “Out of Home” comes to play. The appeal of this topic lies in its innovativeness as it adds a “service” dimension to what used to be a purely “sales” product.

Search for OOH on the net and you will give umpteen results on out of home advertising i.e. banners and signboards but I will focus solely on the trade aspect of OOH. OOH trade aims at extracting revenues from the customers when they are out of home i.e. it is one way of increasing customer touch points. In return what the customers get: hygiene, world-class offerings at their convenience. Firms segment the OOH market in the following manner:

• Work: As the name itself suggests, at your workplace, FMCG firms make an effort to reach out to you be it in the form of coffee vending machines or room/cabin fresheners. With the concept of 24 hrs offices at BPOs and IT firms, its consumption round the clock and so you can gauge the lucrative aspect of the concept.

• Wait: “Wait can be killing some times and it can be boring as well” so you are not the only person who bides his time sipping a coffee or munching chips. So, outlets strategically located at railway stations or airports do make business sense. Don’t they?

• Play: Whenever in the company of friends at shopping malls or cinema halls you are an obvious target. Come on! It’s a no-brainer.

So you must have guessed by now that the coffee vending machines are the most identifiable symbol of OOH. You can use these machines to serve tea, soups or even flavoured milk. The other ubiquitous symbol especially at the shopping malls is the ice-cream kiosks e.g. swirl -kwality walls.

By now you can easily guess some of the major players in the field as Nescafe, Lipton (HUL) and Café coffee day. Though in developed nations, RTE or Ready-To-Eat items are a big hit with giants like Kraft targeting it in a big way. In India the major players have not yet made a serious foray into it. You can safely attribute it to the relatively nascent phase of OOH market in India. Though one can find, Maggi Cuppamania from the FMCG major Nestle at most snack bars.

But if you think that OOH can be limited to vending solutions or RTE items think again. Other vertical with massive potential is “Corporate Gifting”. Take the case of a doctor who is showered gifts by Medical representatives. Most of the gifts are pretty similar in nature e.g. pens, writing pads etc. Won’t he appreciate instead a 1kg pack of premium Taj Mahal tea or a beauty kit from Lakme? Well he may not but his wife surely will.

Waiting for your comments and do share any interesting marketing concept that you have come across lately.

1 comment:

  1. OOH the way forward for HUL: