Reimagining luxury car makers

Luxury car makers aiming to dominate the top-end segment of the market, need to reimagine themselves as lifestyle services providers, to differentiate themselves from other players in the auto sector.
 
Some key strategies could be as follows:
 
a) Empowering their premium customers to feel special, by enabling them to select special appearances (both external and internal) of their cars, via various feasible options on their apps or website,
 
b) Rewarding their premium customers via rewards program on every transaction – from buying a car to getting it serviced, and from buying accessories to even referrals,  
 
c) Enriching the rewards program by exploring opportunities for cross-promotions with some leading brands, which cater to the aspirations of same premium customers. Such a strategy would enable better fulfilment of overall aspirations of such premium customers,  
 
d) Initiating “Customer as a co-worker” step, to elicit feedbacks as well as suggestions from their premium customers via an app or website. Valuable suggestions could be implemented and duly appreciated. This should enable further strengthening of the brand value of such luxury car makers,
 
e) Individuals/families/establishments/corporates owning more than one model of such car brand, could be categorized under special categories, say for example - “Bronze, Silver, Gold, Platinum” etc depending on the value/number of cars they own, and privileges under each category be worked out accordingly, and
 
f) Re-imagining customer relationship, by organizing orientation sessions both online and offline, based on the feedbacks from company authorized workshops. Besides #wewantyousafe campaign, focusing on the critical importance of safe driving practices, simple precautions to address common defects/problems found in cars which come for servicing/repairs etc could be key topics for such orientation sessions. This would be a further booster for ‘value for money’ feature for such car brands, and which in turn would enhance the loyalty factor via ‘word-of-mouth’ publicity.  
  
And so on....

Need for a relook at the coveted status of "Unicorn":

It is so disturbing to know about some tech companies, including those which have achieved the coveted status of "Unicorn", laying off their staff in hundreds and even thousands.

Such staff might have dreamt that their companies would be achieving a status akin to Facebook or Amazon etc, and that they would be becoming millionaires, but now would have seen such dreams turning into their worst nightmares.

According to a news report, "After reaching sky-high valuations, tech companies the world over have seen the worst year of their lives amid surging inflation and interest rate hikes. Many are cutting jobs, and shutting parts of their operations to shore up balance sheers ahead of a potential recession".

So, was this status of "Unicorn" really worth it, except for the purpose of raising funds at astronomical valuations?

Some thoughts:

1. It's now time to relook at entire strategy adopted by some of such start-ups. From "fastest growth any cost", the paradigm shift should be - achieving "USPs" or "Unfair advantages" at "slow and steady pace", akin to the fable of hare and tortoise,

2. The headcount strategy should be based on "1-2-3" principle. That is, hire one, pay him or her the market level compensation of two, and assign responsibilities of three. That such a strategy would lead to better development of human resources, better motivational levels and lesser turnover, thereby positively benefitting the organizations as a whole in many way, is anyone's guess. Of course, this strategy needs to be supplemented with due care of the possible "burn-out" issues and need to rejuvenate the energy levels of their headcounts, and

3. The VCs etc who decide to finance such start-ups need to adopt a "three-legged race" mindset vis-a-vis their investee companies. They need to extend all possible support, besides being glued to their operational matters without any undue interference, so that they can offer constructive suggestions based upon their vast experience. That such a mindset would ultimately enable them (VCs etc), to realize superlative returns from their investee start-ups, is anyone's guess.

Strategic alliance between airlines, leading hotel chains, and multiplexes:

Two news items caught my attention.

 

1. Indian carriers, both low-cost and full-service, are revising their in-flight menus to offer passengers a differentiated fare, as competition is heating up amid the boom in air travel with the waning of Covid 19. The need has been felt by such carriers, to differentiate in services like meals, enhance ancillary revenue, and create a distinct space in flyer’s minds, and

 

2. Theatre chains typically get 50-60% of their revenue from ticket sales, and the rest from F&B and advertising. There may be months when no film works. Globally then, F&B and advertising helps de-risk the business. With this in mind, most of the biggies in cinema exhibition business have been investing in food variety long before the pandemic. Further, the need for premium experience for the movie goers at Multiplexes has also created a need for an upward push on F&B spends, which have shown a rise of 20 to 50% across the business. For almost three years now, the 702 screen Inox has had a tie-up with ITC’s ready-to-eat, gourmet brand, “Kitchens of India”. Since the pandemic began, PVR and Inox among others have been retailing their food on Swiggy and Zomato. And over the last eight months Inox has been doing a lot of culinary sessions with expert chefs in their properties. The idea is to convince people that multiplexes can do gourmet food. This in turn has helped F&B revenues.

 

Clearly, these two news items indicate the possibility of a promising strategic alliance between airlines, leading hotel chains which boast of distinct F&B offerings, and multiplexes, with each alliance partner leveraging its respective core competencies, to provide a combined value proposition to their respective target audiences.

 

Besides, exploiting the tremendous opportunities for cross-selling, such alliance partners can also leverage their respective analytics capabilities, and share with each other the insights gained on the perceptions and expectations of their respective target audiences. The attendant benefits would be obvious.

 

Moonlighting

If moonlighting by any employee in anyway compromises with his/her full-time employer's interests, then does it make sense to be acceptable to the latter? Surely, the answer would be an unequivocal NO.

On the other hand, if it does not compromise with the full-time employer's interests in any way whatsoever, then it's only prudent for the employee to take his/her Bosses into confidence, before getting into it.

Yes, times may have changed, and the 'employer-employee' relationship too may have undergone changes in varying proportions, depending on the culture of the organization.

But one aspect will never ever change, and that is, the element of 'trust' as the edifice of such a relationship.

Rate increases by US Fed

If the US Federal Reserve is bent upon making sizeable rate increases until they regain control of inflation, and even if it means risking a recession for the US Economy, then are they prepared to tackle the recessionary trends in the US Economy, should their aggressive rate hikes actually result in the same? Would they again resort to monetary easing to revive the economy followed by aggressive rate hikes later on?

That their aggressive rate hikes are leading to strengthening of the US Dollar vis-a-vis other currencies in different proportions, depending upon the state of the respective economies, thereby leading to flight of capital to the US and other consequences, should be a matter of concern not only to the central bankers across the world, but also to the IMF in particular. The latter may have to bail out so many troubled economies in the foreseeable future, all due to the fallouts of such measures of the US Fed.

If the key issue is to tackle inflation to bring it to "tolerable" levels, then all the central bankers especially in the emerging economies, need to form an informal group to deliberate upon the new definition of such "tolerable" limits, taking into account other macro-economic scenarios in their respective economies. Besides, they need to deliberate upon some out-of-the-box solutions to address inflation, without risking the highly avoidable side effects of recession. Perhaps, reducing dependence of US Dollars, and giving very lucrative sops for attracting Foreign Direct Investments could be part of the solutions.

It's here that our RBI could take a lead, by forming such an informal group. IMF should be an enthusiastic member of such a group for obvious reasons.

Rejuvenating Indian Film Industry

Some years back, at a social get-together, I met one of the top film makers of Bollywood. He revealed that in quite a few cases, when a film is first conceptualized by way of a script, it is something else. Then, before the shooting even begins, it undergoes some changes to meet the requirements of some important stakeholders, and then during shooting there are again some other changes, and finally when it is released there are yet some more changes.

Assuming this to be an authentic information, I wonder if it's indeed a miracle that such films do well.

Media is indeed buzz with thoughts regarding ways to revive the glorious days of Bollywood in particular, and Indian film industry in general.

While our films today may have made quantum leaps in technical aspects as compared to what prevailed decades ago, yet they do seem to be sorely lacking in great storylines, glamour quotient, soul stirring lyrics and music etc as compared to what we got decades back. It's no surprise that in quite a few singing reality shows, kids prefer singing some chartbusters of yesteryears, perhaps when their parents were toddlers or yet to be born.

Top stars do have all the right to demand astronomical fees, if they are indeed so confident that it's they who can drive masses to the movie halls by themselves. But they would do well to realize for their own survival, that it's the overall ecosystem involved in a film production, that accounts for their success.

Going by the massive success of some films made in south of Vindhyas in the north of Vindhyas, besides in some key overseas markets, it's now time for a pan-India Film Association to take root, to rework the entire business model to revive that golden era.

This should also include strategies such as - talent scouting, storylines, minimal or preferably nil changes after a script is finalized, profit-sharing instead of astronomical fees paid upfront, and above all time bound completion of films etc.

RIL's acquisition of Campa Cola

By acquiring 'Campa Cola' for a highly bargain price of Rs. 22 crores, has the energy-to-telecom and now to FMCG conglomerate 'Reliance Industries', managed to disrupt the concept of 'core competence', or the jury is still out?

Well, having some memories of 'Campa Cola' going back by four decades, must admit that my preference those days was tilted towards it's key competitor - 'Thums Up', mainly due to latter's taste. Their highly entertaining commercials served only one purpose for me, and that was entertainment, and nothing more.

Now, to take on giants like Coke and Pepsi in the aerated drinks segment, RIL should not stick to Campa's old formulations, but invest in R&D to 'attack' these giants with 'arsenals' involving - price, taste, and above all, health and hygiene which have become the buzzwords in the post pandemic world.

That Coke and Pepsi too would be already gearing up their respective 'war rooms', to be prepared for their new 'battleground', is anyone's guess.

Till the jury on RIL's latest move is out, we can be reasonably sure that they are well on their way to disrupt the concept of 'core competence'.