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Sunday, September 25, 2016

[MTC Global] Innocons

Innocons - Innovations that actually end up conning the consumer!


Innovations that shortchange the common man continue to amaze all of us.  This sort of cheating has been happening for quite some time now. In this article, let us look at how we never knew how we were being cheated and ended up falling prey to innovative strategies by companies to entice us. In most cases, these innovations led to consumerism –when people invariably bought things that they never needed. In any case, the main objective of retail marketing has always been – how to empty the consumer's wallet. Advertising gurus are anyway two steps ahead – right from selling a comb to a bald man to selling a refrigerator to an eskimo – they never spare any efforts!


Pediatricians often fume when parents ask them about Cerelac, Farex, Junior Horlicks etc. How do you know that Bournvita Junior is different from the regular stuff?  Are you sure that Horlicks, Mother's Horlicks and Women's Horlicks are not exactly the same? We often rely on the brand – the trust that we have in the brand often makes us blindly believe the tall claims made by marketers. It does lead to a question though – if some of these products are so good, do they really need such heavy duty marketing?


Let us come to baby products. Johnson's baby oil rubbished the practice of massaging with simple coconut oil that generations of Indians have used. They marketed their paraffin containing oil in India that is sold in the US where coconut oil is not very popular. Coconut oil is excellent oil for massaging a baby and any good doctor will tell you not to waste your money on such ultra-glamorous products like paraffin oil that thrive on making ridiculous claims.


Just because diapers were popular in the US, they slowly entered the Indian market. New mothers not excited at the idea of frequent nappy changing succumbed to the lure of diapers. Look at all the advertisements. They will talk about how the baby will feel dry despite the fact that the diaper is wet. Oh yes, if there are diaper rashes, there are creams available to deal with nappy rashes. You guessed it right – Johnson & Johnson would introduce a cream to deal with such rashes. The sad part is that many of these innovations are unnecessary – they only serve to fill the coffers of these FMCG companies.


Most of the ailments that babies suffer from are transitory. They are natural phenomena that help in boosting their immunity. However companies want to capitalize on this too. Every child goes through a teething problem but back in the 60's and 70's there were no teethers. We simply did not need them! But today we have so many products flooding the market. It is a surprise that marketers have not launched toothpaste gels and deodorants for babies. May be they will launch them in the future. We should thank heavens that babies/infants cannot/do not use smart phones.


To be fair, some innovations are interesting and enjoyable though their sustainability is doubtful. Colgate launched bubble gum toothpaste for juniors and believe me, it was fun (yes I shamelessly tried it once). But it vanished from store shelves. Baby soap with milk is another innovation that has sustained over the years only because of consistent quality.


Any MBA professor of marketing will tell you how Kellogg hoodwinked Indians. Despite the fact that Kellogg corn flakes failed in the Indian market in the first few years, the company persisted with its efforts buoyed by its success in other global markets. Today the company has gained a sizeable market share having successfully brainwashed all of us into believing that corn flakes is the gift from heavens that we never had access to earlier. Kellogg is also introducing a number of variants – but the question is – are they pricing it right? Secondly do we really need them? I read somewhere that the margins on Kellogg's products hovers between 40-50%.


I am a strong votary of Indian cuisine for breakfast and if we look around us we have healthier options like roti, idli, pongal,upma, dosa, poha, akki roti etc that can be made with less oil . Corn-flakes are good but are they really filling? And do you really think any sane person can eat Kellog corn flakes in the morning, afternoon, evening and then lose weight? Eating the corn sprinkled with lime and salt during the monsoons is often a wonderful experience! It is natural, is unprocessed and fiber rich unlike Corn flakes which is processed stuff anyway.


We had once visited a resort in Kodaikanal. The chef announced that the dessert for the day was "banana kheer". We were wondering what was so special about it and then realized that it was another marketing gimmick. The so-called kheer was nothing but sugary milk in which a few slices of bananas were seen floating.


Almonds (badams) are excellent for health when we eat them as such. But salted almonds are now being sold and they are imported from US. Hair oils use less than 0.00001% almond oil but in the television ad, you can see a bottleful of badams/almonds indicating that their usage levels in the hair oil is high.


Patanjali is doing roaring business in India and is clearly the toast of India. It is giving the MNC FMCGs (mostly the detergent and food giants) a run for their money complementing this with sleepless nights over dipping margins. But their recent claims about rediscovering the Sanjeevani herb seems to be a bit far-fetched. Sanjeevani herb was used by Lord Hanuman in Ramayan to resuscitate Lakshman who was grievously wounded in the battle with Lanka. I am not really convinced that you can sell 1 kg detergent powder at Rs.30.


Innovations are always welcome and they are a necessity for an organization to sustain in the long run through competitive advantage. However, innocons are certainly a dampener more so as they play with the trust of the hapless consumer.

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The views expressed are individual and not necessarily MTC Global also share the same views.
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