All hands on the deck, Captain!

Shahrukh khan to Host IIPM 4Ps Annual Business and Marketing Quiz

Great ads, greater roll-out plans, greatest financials... but ‘talent-crunch’ might just play the spoilsport!

Advertising, branding, positioning, geographical outreach... and any other progressive act that you could possibly cook up, were ‘once’ considered just the forte of private sector banks and their foreign counterparts. Not any more! The public sector banks (PSBs) have shed their conservativeness, for good and are tired of being branded as laggards. Today, their approach towards broader outreach, customer acquisition & education and product offerings is anything but the mark of a self-satisfied, complacent public banker. IDBI Bank is one such name, which has opted for an overdrive as far as re-positioning and re-branding are concerned. The project finance institution turned bank, is leading the race and is aptly recasting its business model, strengthening itself through organic growth strategies and basking in the sun of glorified financials!

Its newest taglines: “Not just for the big boys” and “Aao sochein bada” also project the inherent strength of the bank, which, for the first time in a decade, has hit a positive home-run – a positive net interest margin and the highest annual growth in terms of deposits and lendings (30%) amongst all banks in the country. And today, the bank is not just making money for its stakeholders but also working towards ensuring ‘some’ tomorrow for industries across the board. Picture this: IDBI Bank Ltd. is leading a group of lenders to arrange $1 billion debt for Air India (after the airline failed to raise funds from European banks to buy Airbus SAS aircrafts); some reverse osmosis at a time when the biggest of names in the vertical are running around with bailout bowls in their hands (and 9 more for bailout nos.2 to 10). The bank is aggressively pursing the dream of becoming the 5th largest bank by 2011-12, from being the current 8th. This would also help improve its low cost current account savings account (CASA) ratio, which is pegged at 15.22% of the total deposits to somewhere close to 40% (which is the standard for other public sector banks).

So there’s some dream, and happily complemented by ambitious financials. Digest this – it is targeting a growth of more than 100% in its business to touch Rs.3.35 trillion by FY2011 as compared to FY2008. Considering that market reports suggest an estimation of Rs.2.1 trillion by the end of the current fiscal, another good year will just see it get there! So there’s it – great dreams, super numbers and big hopes... but not sans challenges! And what’s the catch? Having obtained the much needed licence from RBI to add 200 branches (at present it has 508 branches and 880 ATMs) by March 2009, its expansion plan had to be ‘carried forward’ for lack of managerial staff. Given the fact that IDBI expects its branch network to grow by 40% (which will indeed enable the desired business growth), ‘talent - crunch’ may just play the spoilsport.

For now though, IDBI is staying away from inorganic diet; having achieved much success in the change process, as Yogesh Agarwal, CMD, IDBI Bank happily quotes, “The bank has indeed come a long way from being a pure development financial institution and is currently transforming into a new generation, full-service commercial bank...” Better safe than dead! But considering that its internal growth plans are paying well, there’s no need to be swept away by the M&A wave... Silent waters run deep... But wait! Is IDBI playing the ship, or is’t the ocean itself? Whatever its intentions, it needs all hands on deck – manpower! [And that one was for you, Captain Yogesh!]

Gyanendra Kr. Kashyap

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Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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No individual can be bigger than the game.

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Interestingly, this statement is especially relevant to marketers who are looking to strike the right shots with their shrinking budgets in a slowdown. Pawan Chabra & Pallavi Srivastava of 4Ps B&M examine why, in humbling times, IPL promises marketers what the best celebrities cannot.

Is thrift the only mantra of the season? Well, market logic dictates that it’s not just about cutting back on your resources (read: marketing budgets) but also carefully analysing where the cost benefit analysis of a marketing investment can work overwhelmingly in your favour. Thus while companies are cutting corners in their marketing budgets, it would all be in vain if they cut the wrong corners!

So faced with the question: In whom to invest? In Hrithik Roshan or Shahrukh Khan’s Kolkata Knight Riders? marketers should pause before answering. For the latter promises an intoxicating, blockbuster combination of Bollywood and cricket. Last year, the combo had sent an adrenalin rush through the veins of marketers and advertisers. Most probably, you’re one of those who doesn’t even need to ask how the combo could generate a high sense of excitement among marketers. The answer is obvious. Lalit Modi! The man gave India an excellent platform to combine the protagonists we’ve mentioned above, by his biggest adaptation of the Indian Premier League (IPL). Just brush up your memories a bit and you’ll be able to easily recall the scenario of the last season when everybody was crazily fighting to grab a share of the lucrative IPL cake in any possible form.

Well, if last year, in the peak of the boom, IPL made some sense, this year, in bust times it makes for indisputable business logic! A lucrative deal under IPL may force marketers to channelise their advertising budget from somewhere else, which may also include dropping expensive brand ambassadors or regular advertising spends. That’s the reason why Coca Cola India prefers Shahrukh’s Kolkata Knight Riders (KKR) and Delhi Daredevils over superstar Hrithik Roshan. One look at Coke’s advertising patterns on TV will reveal that Coke has not come up with an ad featuring Hrithik for a long time (after the last ‘Jashn mana le’ ad commercial). Moreover, the frequency of Coke ads has also relatively gone down. Similarly Sprite (for which Coca Cola India has tied up with KKR) also doesn’t have any brand ambassador as of now (Sania was the endorser of Sprite earlier). Undoubtedly, Coke is spending its marketing budget wisely. Probably that’s the reason why they have tied up with Delhi Daredevils for brand Coke and with KKR for Sprite.

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
Detail of all IIPM branches
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IIPM Admission Detail
IIPM INTERNATIONAL - NEW DELHI, GURGAON & NOIDA
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