Bajaj Allianz Life Insurance’s strategic disaster of Repositioning:

The latest victim of Repositioning seems to be Bajaj Allianz life Insurance. They have changed their tagline from “Jaise Jarurat waise insurance” to “Jiyo Befikar”. The original tagline mentioned about ‘customised offering’ by Bajaj Allianz. The new positioning mentions about the trust factor which has an emotional appeal.

Trust factor is the most important criteria in Insurance products. The problem though with this new positioning is that the other companies have already made this appeal in their positioning. ICICI Prudential’s tagline ‘Jeetey Raho’; SBI Life’s tagline ‘With Us, you’re sure’; Birla Sun Life’s tagline ‘muskurate raho’ and HDFC Standard Life’s tagline ‘Sar Utha Ke Jiyo’, all mention about the trust factor with an Emotional appeal.

This is where Bajaj Allianz has made a mistake. It was the only company which focused on the product with a practical appeal. It differentiated itself explicitly from the other companies. By doing this new positioning with an emotional appeal, it has lost out on the differentiation.

Maslow’s hierarchy of needs- Self-Actualisation stage seems no more relevant:

The most widely spoken HR theory, Maslow’s hierarchy of needs theory, has lost some of its relevance to a certain extent. At least that’s the way it seems from the furore that has been caused in the corporate world with regards to executive compensation which the government will decide. This is in context of the financial institutions which have taken help from the federalUS government after the financial crisis hit everyone

Maslow’s hierarchy of needs talks about the needs’ hierarchy starting from the basic needs to safety needs to belonging and love needs i.e. acceptance in society. Majority of the population in the world falls in any of these 3 categories of needs. The next need is of self-esteem and then there is the topmost need of Self-Actualisation. A person who has reached the self-Actualisation stage does not think of money as the motivating criteria. This looks good in academics but not in real life.

Financial institutions in the US are in need of competent people who can get these troubled institutions out of the problems. The HR department of these firms and the government is finding it difficult to hire people since these people want higher salaries and bonuses without government intervention. They also are averse to these jobs since the pay compensation will be scrutinized but the media thread-bare and the government will also not give them a free hand in working the enterprises out of its hole. The media will discuss these issues in the living room of the common man who works for the real economy on the floor of the factory. The financial managers are already under fire for the crisis and if the common man finds out that they are still being paid high salaries, it will result in problems for the government who is bailing out these institutions with the tax payers’ money.

The point now is why are the people who have crossed 45-50 years of age and amassed huge amount of wealth wanting salaries, knowing well that it is the fault of people like them who are responsible for the crisis. To be a bit on the blunt side, the greed of these people. These people are in the self Actualisation stage yet they want money. Why do they not take it as a challenge to turn around the banks a la Lee Iocacca who turned around Chrysler? If they are successful in this, automatically they will get there bonuses and there premium will increase for there next job. Moreover the common man will get his confidence restored in the financial system and the people who run it.

Apart from this; the two most recent examples which defy the self Actualisation stage are of the Satyam Chairman Ramalinga Raju and former NASDAQ Non- Executive Chairman Bernard Madoff. Both these people were billionaires and respected in society.

Ramalinga Raju had a successful company and was almost a deity in his home town ofHyderabad due to the vast amount of opportunities he created for the locals. The Rs. 7000 crores scam was completely uncalled for. He had everything going for him.

Bernard Madoff was a rich a fund manager of an asset management company and respected in society. There was no need for him to run a Ponzi scheme to the tune of almost $50 billion.

Thus the needs theory has lost its relevance due to a certain type of people, for whom; money is the end all, be all. Maslow of course need not be blamed for his theory; it’s just that nowadays people behave totally irrationally.

DISH TV Advertisement - totally unimaginative:

There are ads which are not good, there are ads which are bad and the there are ads which cannot be described, simply because they are so irrelevant. There aren’t any adjectives to describe those types of ads. The latest Dish TV (ZEE Entertainment Enterprises’ DTH arm) ad starring Shah Rukh Khan falls in the last category mentioned above.

Please can anyone tell me, what on the face of this earth means “Wish Karo, Dish Karo”? The ad does mention about 200+ channels and satellite giving signals. There is nothing which will be of direct benefit to the consumer. It does not talk of differentiation, or positioning, or doesn’t compare itself with competition. It does not focus on cost or any other special attribute of Dish TV although 200+ channels is a feature, but it isn’t compelling enough a feature to warrant that the customer buys a Dish TV only. The customer is perfectly susceptible to the sales pitch made by the salesman. Here in lies the problem.

Dish TV was the first DTH TV in India and for a long time, it did not have any competitors. Yet it failed to show the advantages that DTH offered. It did not take the first-mover advantage. It went on its own pace. It did not do aggressive promotion and wanted more players come in to create awareness.

The latest commercial is a totally unimaginative. It uses a child in the ad. Children aren’t the target market and neither are they influencers in the purchase of DTH. They do not know the difference between cable TV and DTH TV.

Overkill of Reality Shows on MTV:

MTV India was known for the Crazy antics of the two Cyrus’, Broacha and Sahukar, the rap of Nikhil Chinappa, bubblyness of Shehnaz treasurywala and a host of other Video Jockeys (VJs) who anchored the different music shows. Currently MTV is synonymous with the bald twins, Raghu Ram and Rajiv Ram, who rule the roost as far as content of programming is considered on MTV.

‘Roadies’ was the first reality show on MTV. It was an instant success. Raghu was the face of Roadies whereas Rajiv was always behind the scenes, far from the prying eyes of the media. They both made 5 successful roadies seasons. During Roadies 6, Rajiv surprised everyone by his appearance i.e. the virtue of being Raghu’s look alike. Roadies’ season 6 was a success. By the time, Raghu had become so famous that audiences watched the selection round of contestants more than the actual Roadies show. His attitude, brashness, and aggressive demeanor are loved by the viewers especially when he rips apart the contestants. It isn’t about the sadistic pleasure for the viewers, it’s that way he slowly makes them confess things and then cross questions.

They made another show, MTV Splitsvilla whose 2 seasons were as successful as Roadies. Currently both the twins are producing a new show, MTV Connected which deals with the chemistry of twins. They seem to have a winner on their hands with this show. It is more since they have Raghu and Rajiv along with Nikhil as judge. The problem though seems to be of viewer fatigue. Raghu is all over the place on MTV. The reality shows have Raghu written all over it. ‘Expect the unexpected’ symbolizes the thinking process of Raghu. Therefore too much of similar stuff cannot be a good thing from future content point if view for MTV.

‘Unique Content’ is necessary on television in India at this point in time to be successful. Monotony should not set in. we can see what happened with the ‘saas-bahu’ series. They had to be pulled off air. Rather late according to me but atleast it’s off air, for good.

After this show, Raghu should take a long hiatus from MTV. This is the only way viewer fatigue can be avoided. Even if Raghu works backstage on a show, his imprint will be felt by viewers. It wouldn’t be a surprise since he is the one responsible for creating a ‘Cult’ of Roadies in India. Wearing that Roadies badge is considered an ultimate achievement in adventure.

Viewers should yearn and crave for Roadies. No one understands this psychology than Aamir Khan who does just one film a year. TRPs will shoot through the roof once new Roadies show will be announced after a long gap.

Care should be taken by MTV producers to rest the hen which lays the golden eggs. An overkill of Raghu would do more harm than good in the long run.

Scooty Streak- “the Riding Experience”

The Priyanka Chopra advertisement for Scooty pep mentioned a bit about the driving experience of bikes for girls when she said in the tagline “why should boys have all the fun”. The new ad for Scooty Streak takes the concept further in a much pronounced way about the pleasures of riding a bike. It tries to make girls ride a bike for themselves rather than riding pillion. The positioning thus seems to be the “riding experience” for the target market of young and unmarried girls. This is proven from the last line of the ad when she says and I quote “chalane mein aaye itna maaza toh peeche kyu baithe” (unquote).

The ad tries to change the behaviour of girls where they like to sit pillion to there friends. It is a way of empowering the girl and makes them feel equal to boys (not to say that girls are not equal but here they are stating it explicitly and challenging them to ride their own bike).

However a small glitch in the concept of the ad is that it seems to have bee inspired by the BMW campaign of “the ultimate driving machine” where BMW positions it as an engineering marvel and a car which should be driven by the owner and not chauffeur driven. Though the difference in the Scooty campaign is that the have not tried to show the engineering side of the bike, rightly so.

The ad serves its purpose and only time will tell how successful the bike becomes. But the execution and content seems just about perfect.

Sustaining Employee Morale During Recession:

When you treat your employees well, they will treat their customers better (this not only improves the employee satisfaction and morale but also the customer satisfaction)

The simplest way to improve morale would be to tell them that they need not worry about their jobs and that it is secure. But for this, you need to make a list of employees who you surely want in your organisation irrespective of recession.

How this can be done??

1. Personalized e-mail form the CEO asking the employees to feel secure about their future in the organisation.

2. Telling them that the company does not believe in cost cutting by slashing employee salaries. And Empowering them by asking them for suggestions to do cost cutting at which other avenues.

3. Communicate as much information about the organization as you can to all of your employees, regardless of their position. Throw any notion of “need to know basis” out the window and give them all the info you can about every aspect of what’s going on. This would include discussing the financial position of the company, present and the future

4. Talk to them one-on-one about their role in the organisation. Tell them that they are an important cog in the wheel of success of the organisation. Make them feel that they are Indispensable to the organization E.g. When an employee completes a project, handles a difficult customer, or comes up with a solution to a problem, tell them, “I just don’t know what we’d do without you! We are so fortunate that you work here!”

5. Chart out a career path for them in the organisation. This will make them company loyal and feel secure as well

6. Appreciation: nothing can give a boost to employee morale more than appreciation from his senior and that too in the presence of his peers. E.g. During staff meetings, lead rounds of applause for individual and group successes that have taken place since the last meeting. Here, a non-cash compliment gives more boosts than mere handing over cash reward. And since non-cash benefits cannot be quantified, so there is no question of employees comparing and feeling there ahs been a bias

7. Give a hard-working employee a new responsibility or ask them to head up a project or task force, or to evaluate a new idea and provide feedback. This would make them feel that they are required in the organisation

8. An informal workplace where the hierarchy is immaterial. A conscious effort can be made by the HR department to make everyone feel equally important by removing hierarchy.

9. There can be no better time to invest in employees. Cross-functional skills can be given by training since the job gets redundant and not the employee. The experience of the employee can be used at other place which gives flexibility in the present and so also in the future.

10. By doing this, the focus can be more on work in a profit centre by shifting them from a cost centre

11. Providing positive leadership: leading from the front and setting an example. E.g. Vikram pandit, Citibank CEO taking just $1 as salary and no bonus so that there need not be cut in employees pay

12. Financial planning: finance employees will have intractions with the employees and do their financial planning regarding savings, expenses and investments

13. Acting as fund managers: Treasury dept. can act as fund managers for the investments of the employees which can be pooled together. This though will be Optional

14. Increasing the notice period from one month to three months. This may seem negative but what we are telling the employees that even if they are laid-of, they have a cushion of salary till they find another job

15. Also having a talk to employees who might be sacked that the HR dept. will search jobs for them with other sister concerns or vendors wherever possible. This will tell the existing employees that they are being cared for and looked after.

Conclusion: the way an organistion treates its employees in tough times , says a lot about who stays with the company in good times

Happy Dent makes you happy!!!!

An advertiser has to walk a tight rope when it comes to showing exaggeration in the advertisement since it can backfire and the customers won’t accept the product.

There is an exception to this though and it is the happy dent whitening gum advertisement. Exaggeration has never been so cheerful, adorable and charming.

The exaggeration started from the buffalo ad with Dr. Bhatavdekar where he compares the teeth of two buffaloes, one with yellow teeth and other with pearly whites due to the happy dent gum.

The next ad was of the photo shop where a person flashes his teeth which are so bright that they do the work of flash for the cameras. The exaggeration is quite creative and funny too.

Then it was the setting of the maharaja palace where everything was illuminated, not by lamps, but by the pearly white teeth of his servants (the human right would have taken objection for such a depiction but even they say the lighter side of it) right from the street lights to the garden to the entrance gate to the dinner table of the maharaja.

The latest ad features elephants with glowing tusks which light up the forests against a back drop of a rural setting where villagers do not have electricity.

These types of ads not only act as clutter breaker but people actually are on the look out for a new and creative ad. The problem though with this scenario is that the creativeness of the ad overshadows the product and people just remember the ad and not the product on display and thus the ad fails to deliver what is expected of it i.e. sales of the product.

But the bottomline is that the ad has caught the fancy of the people and it should result in sales of happy dent. What can we expect in the next ad, a crow with pearly white beak? That would be quite a contrast, isn’t it?

RCom GSM ad featuring Hrithik Roshan:

The latest Reliance Communications (RCom) Ad for its GSM enabled cell phones featuring Bollywood superstar Hrithik Roshan fails to create any impact. I am not sure if it would result into Sales for RCom. 

We will analyse the ad based on certain parameters: 

Creative content: Not at all

USP: not mentioned

Positioning: not mentioned

Target market: there doesn’t seem any target market at all.

Differentiation: nothing

Recall factor: No 

The ad content of “relive, remember, recall and respect” is an emotional style of execution but it isn’t anything more than that. The ad doesn’t break the clutter at all. There is nothing worth remembering in the ad except for may be Hrithik. 

If you compare it to the Vodafone Zoozoo ads (the comparison is inevitable), then the ad pales in comparison. The Zoozoos charmed the audience and have bought into limelight the Value-added-services of Vodafone and clearly positioned them as VAS providers. 

The RCom ads don’t have any of these things. Moreover all the other telecom players such as Airtel, Aircel, Tata Indicom, and BSNL advertised during the IPL. RCom, knowing its history was conspicuous by its absence. 

The strategy that they seem to have adopted is to be the sole advertiser during the World T20. The problem though is that they cannot stop the advertisement by these telecom players on other TV networks. 

The other problem is that the IPL is an Indian competition. For any match, some part of India would be watching the match as against the World T20 where India has just 7 matches maximum and that too only if India reaches the final. The IPL has 59 matches. The comparison is just not on. 

The ad should focus on the 3G aspect which it just mentions at the end. Why not make an ad specifically showing its 3G compatibility and readiness. More so since it is the first 3G enabled GSM-ready network. It straight away gains a first mover advantage over Vodafone, Airtel and other GSM providers. 

The objective of the ad should be to focus on the 3G aspect. The differentiation has should be clearly presented. The only silver lining could be their Brand Ambassador Hrithik Roshan. His fan base and versatility as an actor adds a personality to the Reliance brand. 

Expectations from Dr. Manmohan Singh’s Government:

Reform: (v) make changes in (something) so as to improve it

All economic and political pundits on NEWS channels are so optimistic about the new government at the centre. According to them, the government is free from the communist burden, and hence they are going to take some hard decisions regarding reforms in some of the key sectors. I hope the government doesn’t flatter to decieve now that it has got a strong mandate for governance. There is this game of prophecy being played with all these experts on television egged on by NEWS Presenters. They seem to be playing “If I was the PM”, “If I was the Finance minister”. The same questions are asked to the same experts on different news channels.

I think I need to join in this game and have some points written regarding the same.

The most pressing matter at hand for the govt. is to revive the economy and get India on the growth path. This is easier said than done primarily because India’s performance is linked to the global conditions as India isn’t decoupled from the developed west.

Priority sectors need to be earmarked by the govt. as the first step. The list would consist of Insurance bill, pension reforms, Infrastructure (roads, railways, aviation, shipping and power), reforms in Banking, education and telecommunication.

As soon as the election results came out, the following Monday, the Equity markets jumped by 20% and the market had to be shut for the day. the euphoria was due to the election results of a stable govt. for next five years. But this upward movement can be stopped if some sudden changes are seen in the western developed world. The rating for UK has been downgraded due to there critical fiscal position. A similar case can be though of for the US. If this happens, we do not know how the financial world will react and how will our markets react. However in all this euphoria, the fundamentals have not changed. So it is better to be banking on the fundamentals rather than the ‘sentimental premium’ and the feel good factor.

Let us start with the requirements in the Infrastructure sector. India seems to be primitive, a sort of an exaggeration, compared to China in infrastructure when we compare our cities with Shanghai, Beijing among others. Although China's villages are in very bad state compared to our but there growth is fueled by industry. India’s growth, on the other hand is fueled by agriculture and industry alike. Imagine if India becomes equivalent to china in industry, the Chinese cannot compete with us in agriculture, and then India would truly be an Asian tiger prepared to take on the world. We also have the added advantage of English which the Chinese don’t have. Skilled labour in the form of engineers who can do innovation which the Chinese cannot boast of. China can only imitate others, it cannot innovate.

Roadways need to be tarred in the interiors for efficient movement of goods and services. Shipping and logistics have been such as weak area for India. In spite of having such a long coastline and boasting of being the largest peninsula, we have Dubai, UAE as the International port in the region. A port development authority needs to be setup to expedite the matter. If we make the western coast of India i.e. Mumbai and Gujarat, as the international port, India can stop the potential attack on this area from Pakistan due to political and economic compulsions from the world.

The job opportunities would be so large for the Indian economy. This isn’t possible immediately but a roadmap for it to happen in the coming 5 years is needed especially since the govt. is free from any political or coalition pressures.

Same issues are for the aviation sector. The previous aviation minister, Praful Patel was chiefly instrumental in starting the process of improving the India airports and the infrastructure with improvements in the Mumbai and Delhi airports. The MIHAN cargo hub at Nagpur should be built on a war footing for its impact to be felt on the India economy soon. Development of regional airports should be high on the agenda too. New airport at Navi Mumbai to supplement the international Mumbai airport is an immediate necessity. If this is fructified India can have its own F1 track near Mumbai. This would give a boost to the Indian economy year on year.

Just 5% of the Indian population travels by aeroplane according to the pioneer of low-cost carriers in India Capt. Gopinath. This is due to the dearth of infrastructure i.e. airports in all cities. If this 5% could increase by another 5% in the next 5 years, more jobs will be created and efficiency and effectiveness of Indian business will increase.

The golden quadrilateral project of connecting the 4 metros and some other important cities by roads started by the NDA govt. hasn’t been completed in the 5 years of the UPA govt. Is anything needed to be said in this case…

The railways have seen a surprise turnaround by the charismatic Lalu Prasad Yadav. It has become a case study in some of the premier B-schools in India and abroad. We have reached here, but sustaining it is necessary. Railways are the veins of the Indian economy and if they are kept in good shape, India will continue with its growth story.

To do all these infrastructural work, it requires massive funding and the burgeoning fiscal deficit due to the stimulus packages announced last fiscal isn’t making things easy for the finance ministry. S&P has already downgraded India’s sovereign rating. Thus a plan has to be chalked out to keep a balance between growth and increasing fiscal deterioration.

Banking sector: The financial markets expect Banking sector reforms which includes foreign banks increasing there stake in Indian banks. The reason for this wish is that this will increase the capital inflows. The govt. won’t have to spend on it will be financed by private capital thus reducing the fiscal burden. The rationale in this case seems a bit incorrect because India can anyways build up capital from the country with the huge savings. Moreover the capital in developed countries has to flow to the developing countries if they want handsome returns.

The present downturn has resulted in mass exodus of money which primarily has been FIIs from the stack market. Some FDI which was to be invested has been postponed just till the downturn nears its end which will happen within the next two quarters especially since some big ticket reforms are on the anvil with the govt. free from the left’s shackles.

The India PSU banks and even the private Indian banks have done well in spite the downturn because of the strict restrictions regarding the conditions for lending by the RBI. There isn’t a hurry to allow foreign banks here. Rather this is an opportunity to strengthen the balance sheets and asset base of the Indian banks. All major banks in the US and Some in Europe have taken govt. help in sustaining themselves. So why should we open up when there isn’t an immediate need to do so.

If the six associate banks of the state bank merge to form a single entity, it will have a customer base to rival foreign banks. It would be a mammoth entity to take on any foreign bank if and when they come. Imagine if the reverse merger of HDFC bank and HDFC takes place into HDFC bank. The only reason it isn’t happening as of now is because the asset base of more than Rs. 50000 crore (conservatively speaking) of HDFC will be subjected to CRR and SLR which would amount to almost Rs. 5000 crore kept with the RBI for no interest and hence no returns on it.

The pension bill if passed will allow the pension money to be invested in the capital markets. This should be done in a conservative manner. Initially through debt instruments such as corporate bonds followed by the equity markets and the currency markets.

Power sector: the govt. wants the economy to grow by 8-10%. How is it possible if you have power cuts in the industrial belts? Some of the companies have to shut shop for a three day weekend owing to shortage in power.

How do you expect that Indian agriculture will lead the growth story if there isn’t electricity to pump water from the irrigation facilities i.e. if they exist in the first place .

Power projects take 3-5 years to generate electricity. It is the most urgent need to look at power generation.

Telecom: India is second only to china when it comes to mobile penetration. In India, about 400 million people are connected through mobile phones. This leaves a growth potential of about 60 plus crores if they have the paying capabilities. This sector too has infrastructural problems. There is lack of telecom towers compared to the total customers. This leads to lot of pressure on the exiting infrastructure and hence connectivity and clarity of voice problems ensue. This problem is more pronounced in the congested metros where there is high population density.

The 3G spectrum allocation auctions have been going on for more than two years and yet they haven’t been finalized. This has resulted in a heavy loss of money for govt. treasury. The auction process needs to be expedited immediately.

Broadband services also lack due to infrastructural problems. Internet connectivity improves the quality of business decisions and the efficiency. This is amply clear from the ITC’s e-choupal initiative for the farmers. The farmers get the best possible deal for there harvest and can even hedge there positions with respect to the market. This shows the wonders IT can do for an emerging economy to sustain itself and grow exponentially.

Education sector: reforms in the education sector means throwing open the doors for foreign universities to set shop in India. This will not only change the education system in India but also make behavioral changes in the perception and outlook towards research which forms the bedrock of a developed economy.

Post-graduation courses need to be liberalized towards the open markets and need not be subsidized. There is enough funding from banks to finance the tuition fees of the needy and deserving candidates.

Mobile Telephony: It’s Impact on IPL !!!

You must have seen Indian cricket team captain MS Dhoni walking down a caricature aeroplane in an advertisement during IPL 2.0, for a telecom service provider from south India who has just now entered the most congested market, Mumbai,. He talks about how he is in contact with his friends through Facebook at the click of a button on his cell phone when on an overseas tour, how he shares pictures with them in a similar same way.

Imagine you are sitting at the Bull ring (Wanderers stadium, Johannesburg) and discussing about the IPL through social networking sites such as Facebook, Orkut with your friends in the UK, keeping your friends in India who are in there offices, updated about every run scored through micro-blogging on Twitter; and at the same time chatting through gtalk or yahoo messenger with friends in the US who don’t have access to SET MAX. Isn’t it similar to being with your friends in four different continents in real-time? Wouldn’t it be so much fun to be the source of information to your friends at the click of a button on your cell phone? You think I am kidding, right?

I am not. This is the advantage of mobile telephony made possible by the 3 G technology. Mobile telephony is a type of value added service provided by telecom service providers for people to be in constant touch with your friends and peers. Just activate the internet through your GPRS and be online 24*7. You will never miss any information happening around the world if your friends too have there internet accessible and you can have a ball of a time through these facilities. The world isn’t just getting flatter and a smaller but its going digital too. All of it made possible by the mobile technology. 

This is from the perspective of the individual whose world revolves around the ubiquitous cell phone which includes just about everybody now. 

Let us look at what it has done to commerce from the industry point of view. 

Gone are the days when employees in office would call home to ask about the cricket score or get in the corner cabin with a radio and hear the commentary. Now you have the cell phone which has substituted the encyclopedia and gives you update to-the-minute from any part of the world on any topic under the sun. How can cricket not be a part of this in a cricket crazy country? 

Marketers have been quick to understand the impact of the third screen (the first two being TV and PC) and the role played by Screenagers (they are the youngsters who are constantly in front of any of the three screens at any given point of time). What better place to experiment than the carnival of cricket IPL which has been described by some media pundits as ‘Cricketainment’. 

The infamous fake IPL Blogger gained lot of publicity. People visited the Blog through there cell phones. The ‘Miss Bollywood’ contest required viewers to send SMS and vote for their favourite contestant to win. It was a huge success. SMSes were pouring in from India.

Each innings asked a question about the performance of a batsman or bowler or team. The voting had to be done through the IPL website. This was a strategic move since this resulted in viewers visiting the website and also accessing the website through their cell phones. To stimulate the use of cell phones, this was done. They could have just asked to sms their votes but this wasn’t done. 

The ‘predict & win’ contest too was a good marketing tool but unfortunately due to government concern that it encouraged betting, the plan was shelved. It can be started in a different way next year and I am sure that the marketing team led by the maverick marketing genius, Mr. Lalit Modi would find a way out of it. 

The cell phone can be used even as a DTH or IPTV in future as WiMax implementation takes place soon in India. This has to be preceded by infrastructure for broadband and the allocation of 3G spectrum to the service providers. Reliance Communications in planning to show the T20 World cup matches on the cell phone. I am sure it is going to be a huge success 

Widgets could have been used in the cell phone to update the cricket enthusiasts of the IPL scores at a nominal cost. The sporting merchandise which brings in handsome returns to the franchisees should have been easily available on the internet for people to view in the form of screensavers or wallpapers so as to stimulate demand. For some special exclusive items, the option should have been to buy it online from a cell phone only. This would mean that only the affluent people who use the high-end phone would be able to buy it. Thus you could have charged them extra and projected it as a premium brand. 

However there a certain small constraints to mobile telephony: 

1. High cost of 3G enabled cell phones 

2. High cost of accessing the internet on the cell phone 

3. Slow speed of internet access 

High cost of cell phones cannot be down very soon but with 3G being implemented, more and more people will use it and this will result in more volumes of phone being sold. Thus prices of phones will come down. Second constraint too in a similar way will reduce prices as more and more people use mobile telephony. The third constraint is an infrastructural constraint which will be solved as Indian telecom sector grows. If these issues are overcome in the next year, then there will be increase usage of mobile telephony. 

I think IPL and Entertainment on the Big screen and Television is going to drive mobile telephony in the coming months. Mobile telephony is in a nascent stage in India and hence the growth potential is infinite.

Waiting for IPL 3.0, bigger and better!!!

“Green shoots”- Natural or Artificial:

Ben Bernanke, the US Federal Reserve Chairman has said that he can see some “green shoots” in the economy i.e. some positive signs of the economy reviving and coming out of the negative growth it has witnessed since last 12 months. 

The US equity markets have rallied for the past week. The equity markets of some emerging markets such as India too have seen a rally. The month of May saw India’s benchmark index, Sensex, go northwards by almost 3000 points 

But it is largely driven by sentiment about the stability of the new government and expectations of strong and quick economic reforms. More so due to no ‘left’ pressure this time and les number of allies supporting the government.

The green shoots in the economy are good indicators but they are due to the effects of them massive fiscal and monetary stimulus that governments all over the world have injected into the economies. Thus it seems that the green shoots are Artificial rather than natural. Yes, it is an indicator of recovery but once it gains momentum, the stimuli need to be looked at and the government and central banks should exit from it. The recovery needs to sustain itself on the basis of fundamentals. 

A slow growth is much better than an artificial growth by stimulus packages. Too mush should not be read into the data of consumer confidence index in the US and numbers of industrial outputs. The effect of the meltdown is still felt on the Main Street. The Wall Street seems to be recovering. However the people responsible o move markets are few compared to those on Main Street. And as George Soros once said “Collective irrationality moves the market and the market in turn reinforces that perception” 

So we should not get carried away by the green shoots. Be prepared to take some strong and unpopular steps which would be beneficial to both, the Main and Wall Street. Short term exuberance will do more harm than good