Tuesday, January 27, 2009

Thinking Beyond The Young: The Coming Bulge Cohort

Most marketers and advertising people in India today obsess about the young.

And rightly so, considering that more than 44% of India's population is in the age group 20 to 39 years. When you take the top 8 metros the percentage of 20 to 39 year olds climbs to almost 49%, reflecting the on going migration of the young to the cities.

However there is life beyond the young.

Harry S. Dent, an investment advisor, believes that across the world the age group of 46-50 are the marquee spenders and in fact tracks the number of people from age 46 to 50 in countries around the world, as a proxy for growth in consumer spending in each economy. (See Changing Global Demographics, H.S. Dent Publishing, 2007.)

Tammy Erikson, a Mckinsey Award-winning author in her blog post entitled "What Demographics Tell Us About The Economy" qualifies Dent's hypothesis in the following comment:

"Clearly looking only at the 46-50 year age group is a narrow cut at spending patterns - people typically begin to spend more throughout their thirties and early forties. However, an indisputable fact is that the big bulge of high-spending Boomers is moving out of peak spending years, replaced by members of the much smaller Generation X.

And, to add to the conservative picture going forward, members of Generation X have already proven to be cautious spenders. Between 2000 and 2004, the average U.S. household boosted its spending by 4 percent. But the vast majority of this growth came from Boomers; the spending of householders aged 25 to 34 did not increase at all and the spending of householders aged 35 to 44 increased only 1.8 percent, less than half the average rate."


Dent's hypothesis would have as look at the 46 to 50 age group while Erikson would want us to expand the segment to 40 to 50 year olds.

Erikson's analysis of the Baby Boomer Generation (those born between 1946 and 1961 in the US) and Generation X (those born between the years 1961-1981- the 3 year overlap with the Boomer's notwithstanding)is partially relevant to India.

Many market research studies have confirmed that in India as in the US, the young of the 70's & the 80's had a more liberal attitude to life than today's young.
However the difference is that in the US the Baby Boomer generation enjoyed unparalleled economic growth while the corresponding generation in India endured the wonders of the License Raj age.

However, I believe,the importance in India of the 40-50 years cohort lies not in generational attitude but in the numbers.

The 40 to 50 years cohort is about 14% of the all India population and 15% of the metro population. Within the 40 to 50 years cohort, the top end of the socio-economic classification in India, SEC A, account for 15%.

Are marketers paying enough attention to this key segment?

The archetypical 40-50 years brand is Raymond's, the high-end suitings brand. However a time-line study of Raymond's ads (partial archive of Raymond's TVCs)seems to suggest that the brand is keen to handover the torch to the young.

Is Raymond's falling prey to our collective obsession with the young?

The key to a brand are brand values

Brand values while being deeper than lifestyle symbols and attitudes are, by design or not, keyed to life stage.

One might argue that the Nike value of the "can-do" spirit is a value that transcends all life stage. However an equally valid argument would be that the 'can-do" value is keyed in more to the young than the middle-aged.Not surprisingly Nike's brand imagery is uber young.

Does that leave the market open for a middle-aged focused activity-wear brand? Now that's a thought.

The larger point is that brand loyalty does not guarantee a transition across age groups.

In fact it is almost guaranteed that brands do not transcend life stage as brand values unlike the eternal values are keyed to a life-stage.

Can a brand be keyed to eternal values? That again is a thought worthy of exploration.

However returning to the central argument, since brand loyalty will not almost always survive the transition to the next life stage, Indian marketers and advertising people must pay a lot of attention to building and nurturing brands focused at the 40 to 50 years age group.

Because today's young will be the next decades 40 to 50 years cohort and the 40-50 years age group will peak at about 30% of the urban population around 2020.

A Raymond's must preserve it's brand values that appeal so well to the 40-50 years cohort. It has a substantial market today and, hold your breath, a 200% explosion waiting to happen over the next decade.

And going by the same logic there is tremendous business potential for a few Raymond's in every product and service category imaginable.

This is an exciting product/ service and brand design and marketing task waiting to be undertaken.

And I am sure as this recession takes hold and many a marketer and strategist returning to the thoughtful mode (instead of the "follow-the-gravy-train" mode that had everyone hooked over the last decade or so) this great task will find its thinkers and doers.

Sunday, January 25, 2009

The Discipline of Change

Change is the new greed.

About a year ago, greed was good with everyone. Then comes disaster and the only one who seems to have done alright in the past twelve months is Mr. Obama.

And what is Mr. Obama all about? Change of course. And hey presto, change is the new greed.

When greed was good money was, so to speak, the currency.

Money, get away.
Get a good job with good pay and you're okay.
Money, it's a gas.
Grab that cash with both hands and make a stash.
New car, caviar, four star daydream,
Think I'll buy me a football team.

Money, get back.
I'm all right Jack keep your hands off of my stack.
Money, it's a hit.
Don't give me that do goody good bullshit.
I'm in the high-fidelity first class traveling set
And I think I need a Lear jet.
(excerpt from Money a number on the album Dark Side of the Moon, Pink Floyd)


Now that change is the new mantra, the currency is earnestness. It is quite heartening how all our politicians this side of forty are suddenly in their mind harbingers of change.

So don’t be surprised as we have change all around us in a couple of months. Quite literally that is. On ubiquitous posters, wall paintings, TV, radio and press ads.

All of it funded, of course, by the abundant harvest of old greed even though the change is the new greed.

And change as the theme of the season will soon fall upon that other field, besides politics and advertising, that so depends on platitudes: management consultants and experts. What would you except after Satyam?

I am all for change. Really I am.

What makes me a cynical about the current brouhaha about change is that it is the page three types and the same old scoundrels in our country who are embracing it. This trivializes the theme and I am worried that this will delay the taking up this theme seriously by people who can make change happen.

Change is not an idea or even an objective. Change is a discipline.

When change is only used an empty slogan or a new peg to hang the same old platitudes on, it will swallow its users.

An embracing of real change over the past few decades has led to the China success story. In contrast the theme of change in Russia after the fall of communism has in a large measure been rhetorical and the negative results are clear.

Real change is a hard taskmaster. China has mounted the tiger of change (any allusion to Mr.Raju’s infamous tiger is unintentional) and if China gets off before the tiger is satiated it will be definitely be clawed badly if not eaten.

Change is the deepest theme of the evanescent world of Maya. Change is the dance of Shiva.

The makers of change start at the roots.

Mr. Obama started his campaign for change at the very roots of the political process. The roots of power in politics lay in your grass roots support.

There was a time when this support was built from where it should naturally be built. The French Revolution, the Russian Revolution and the movement for India’s Independence are cases in point.

However most of current politics had got lazy, perhaps as most of current society.

This lead to politicians banked on inheriting the grass-root support of entrenched political parties and getting funds from entrenched special interest. The politics of the stagnant status quo naturally followed.

Mr. Obama started from the grass-roots. He and his team sweated in building a grass-roots army of volunteer neighbourhood to neighbourhood. Bringing into the political process individuals who otherwise would have remained clear of.

Mr. Obama and his team built most of his funding dollar by dollar through people donating in the tens of dollars.

There were of course many who donated in the thousands and even millions of dollars to Mr. Obama’s campaign.

But the strength of the ready army of small donors with no entrenched interest but that of change brought a better life for the many counterbalances and keeps in check the special interests of those who donated in the thousands and the millions.

This counterbalance is what gives Mr Obama and his administration the strength to stand up to the special interest of the status quo as he goes about delivering change.

But this is not the only reason why I back Mr. Obama to deliver on his promise of change. Not fully perhaps but substantially. It is because he and his team keep on, according to reports, hoeing the discipline of change after Nov. 4th 2008.

Consider this excerpt from an article by Joe Klein in Time titled “Barack Obama Promises New Destiny. Work Begins Today” about how Mr. Obama and his team set about the task of delivering change where the rubber meets the road:

Quietly, the Obama transition team reviewed every government agency "to find out which specific programs were working and which weren't." It was a terrifyingly brisk and comprehensive process, especially compared with the dust storm produced by the last Democratic President, Bill Clinton, during his chaotic transition period. "During Clinton's transition, you had all these people writing ad hoc papers about what to do at this agency or how to deal with that policy, but that was an extension of how Clinton's mind works," says one of the many Obama aides who is a veteran of the Clinton Administration. "Clinton had this great horizontal intelligence. He could pull an idea from a meeting he had in northern Italy and apply it to spreading broadband service through Iowa. It was amazing but not exactly efficient. Obama is more vertical. He pushes the process along, streamlines it. We had one 25-to-50-page policy paper for every agency."

The discipline of change is not just about the willingness to go the root and work long and tirelessly to make change happen root and branch.

It is also about nurturing the integrity that enables one to choose the steep and thorny route over the easy short-cut just because that way is right. Consider this excerpt from the same Joe Klein article:

In the midst of the transition, President Obama was faced with a telling policy choice: whether to declare a temporary sales-tax holiday. His economic advisers loved the idea. It would provide immediate consumer stimulus, a direct jolt that might unclog the commercial arteries. The money could be easily passed from the Federal Government to the states, which administer sales taxes. But Obama resisted and finally rejected the idea. "He thought it would provide a temporary benefit, that it had no substantial or lasting policy impact," a senior transition adviser told me. "I think he was remembering the campaign, when Hillary and McCain favored the gas-tax holiday, which he thought was frivolous, and he opposed it for that very reason — if we're going to spend money, let's spend it on investments that will make us stronger in the future."

Will Indian politics find its Obama?

I believe we will find ours within the next decade. I also believe it is not someone we heard of today in the national press.

He is perhaps in politics already. Perhaps a grass-roots worker of one of our main political party dreaming the dream that will bring change to India’s politics.

I also believe that an Obama is waiting to happen to the world of business.

As the old verities fall in the world of capitalism, the new paradigm is not going to come from the very experts who failed us in the first place.

It is going to come from a group of outsiders who will revisit global business from the roots up.

When that will happen it will be another manifestation of the discipline of change.

Breathe, breathe in the air.
Don't be afraid to care.
Leave but don't leave me.
Look around and choose your own ground.

Long you live and high you fly
And smiles you'll give and tears you'll cry
And all you touch and all you see
Is all your life will ever be.

(excerpt from the song Breathe from the Pink Floyd album Dark Side of the Moon)

Wednesday, January 21, 2009

Security Consciousness

Turning and turning in the widening gyre
The falcon cannot hear the falconer;
Things fall apart; the centre cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned;
The best lack all conviction, while the worst
Are full of passionate intensity. (Opening lines from ‘The Second Coming’ by WB Yeats)


After 26/11 we have supposed to have increased security across India. One does see increased police and security presence. And the frisking and metal detectors have now become ubiquitous beyond airports to hotels, malls, multiplexes, clubs and even schools.

However does anyone of us feel more secure? I don’t. Almost everyone I know does not.
What’s wrong?

I believe that while our best security measures lack, as Yeats puts it, ‘lack all conviction’ while those who intend to breach our security when they can, as often as they can are “full of passionate intensity”.

We need to make security an integral part of how we think and how we behave. We need to acquire what Mr Chidambaran called “security consciousness” but left it to our imagination to define.

Modern society and every individual in it are passionately committed to the pursuit of comfort and convenience. As a result, comfort and convenience is the conscious and even sub-conscious objective of everything we design, every system we institute and every pattern of behaviour we adapt.

In contrast to comfort and convenience, the provenance of security is an imposed consideration.

It took decades for the world of business to make safety an integral part of product design. Society cannot now afford to take decades to make security an integral part of how we live.

There are no short-cuts to security consciousness. But unless we start today we will be forced to continue with security measures as they are today forever.

Measures that cost us not just billions of rupees but millions of productive man-hours in time lost to ham-handed inconveniences. Measures that will make our children grow up paranoid. And even after all this cost, measures that can fail anytime anywhere.

Security consciousness is an attitude. It is an attitude like thrift is an attitude. Once imbibed, security consciousness manifests itself in myriad ways.
The other key aspect of security consciousness is that it works in consonance with our other needs. Security that results from security consciousness does not result in loss of comfort or convenience but in fact enhances them!

Let me illustrate this with an example.

For years due to conventional security measures, waiting for your visa interview at the US Consulate at Bombay was a pain. The queue was long and uncomfortable as one waited for long periods at the mercy of the weather.

Then the Americans got security-consciousness. You now wait in air-conditioned comfort in a holding station a couple of kilometres away till your turn comes to get on to a high-security bus that takes you the consulate for the interview and then drops you back.

The experts tell me that the new arrangement is 30% more secure than the earlier one because it does away with the high-risk scenario of a crowd of people just outside the consulate building.

And of course it is 100% more convenient for all concerned.
In fact because the security that results from security-consciousness also enhances convenience, it ensures compliance.

The development of security-consciousness in a society is a multi-dimensional process.

Like all attitude inculcation it is most effective at the school level. Every culture needs to build its own security-consciousness curriculum for its school children because it has to be rich in socio-economic and cultural context. Basic templates will be provided by studying what the Americans, the Japanese and the Europeans do in their schools.

The second fertile area for the development of safety-consciousness is in our professional courses. Incorporation of safety-consciousness in undergraduate and graduate programs in engineering, design, medicine, architecture, administration, management would result in a rapid diffusion of safety-consciousness into the systems that run our society.

The third pillar of a security consciousness build-up would be that mother of all attitude builders- mass media and entertainment.
We all know how mass media can whip up emotions and paranoia. We all know the power of cinema to promote patterns of behaviour.

If mass media and entertainment could sit at a table and agree upon a security-consciousness agenda I believe that Indian media and entertainment has more power and talent than any other country in the world to convert this agenda into an attitude that will be widespread in our society.

In conclusion, I believe, if the world becomes truly security consciousness it will be the second coming of the age of true security. The first, of course, was in the Garden of Eden!

The darkness drops again; but now I know
That twenty centuries of stony sleep
Were vexed to nightmare by a rocking cradle,
And what rough beast, its hour come round at last,
Slouches towards Bethlehem to be born? (Closing lines of ‘The Second Coming’ by WB Yeats)

Thursday, January 8, 2009

2008 and The Culture of Merit


I am 2008. 
I believe I did a lot of good to the world. 
But as is the case always when you do good unbidden what you get is blame. So while the cheers that greeted my departure still resonate let me reason with you a bit. 
Is the fact that a world gone mad with greed has been restored to fiscal sanity good or bad? 
There is pain now but the fact is that the so-called economic meltdown is bringing back the culture of merit to the world of business and economics. 
No longer will the brilliant engineer cracking the next breakthrough in fuel cells feel belittled by the money and adulation showered on some ethics-challenged sharpie at Lehman Brothers. Is that good or bad? 
The culture of merit has been a long time coming but it finally arrived with me. It is no accident of history that I saw Obama become the most powerful man in the world. Bush Jr. was perhaps the epitome of a world bowing to the ever so common marriage of privileged sperm and bad but stubborn DNA. 
On the other hand, Obama symbolizes the return of merit to organized human effort. As for the continuing scourge of hunger, poverty, terrorism, corruption, war and worsening climate I had my fair share of all. But let me make a prediction.
A decade from now the golden age of a new flowering of civilization will be traced back to the return of the culture of merit in 2008. It will be the power of merit that will put away the despots in Africa and across the world. It will be merit empowered expertise that will finally get control of hunger, poverty and get humanity on the road to reining in global warming. And it will be merit-promoted understanding that will kill terrorism not at the hand of those who sought to wipe it out through military power but from within, by the very people who used to shelter it. 
And it will be the culture of merit that will make corruption untenable. So while you look forward to relief with 2009 remember the pain that I gave you was the kind of pain that is a harbinger of great gain.