EXPERIENTIAL MARKETING

Submitted to: Mrs. Preeti Rajpal Singh

Submitted by: Sonakshi Gambhir (4824)

Nikita Kandpal (4934)

BBS 3M

1

ACKNOWLEDGEMENTS

This project is a part of the practicum of BBS sixth semester. We would like to take this opportunity to

express our sincere gratitude to our ‘Creative Selling’ teacher Mrs. Preeti Rajpal Singh, for the support

and assistance throughout the project duration. She was a constant source of encouragement and

motivation. Without her invaluable support and guidance, this project would not have seen light.

We thank her for giving us the opportunity to make this project on the “Experiential Marketing”. This

topic has enhanced our knowledge about the new era of Experiential Marketing and the importance of

customer involvement.

2

TABLE OF CONTENTS

1. TRADITIONAL MARKETING.........................................................................4

2. THE SHIFT FROM TRADITIONAL TO EXPERIENTIAL MARKETING...........5

3. WHAT IS EXPERIENTIAL MARKETING?......................................................6

4. NEED FOR EXPERIENTIAL MARKETING......................................................7

5. USES OF EXPERIENTIAL MARKETING.........................................................9

6. DIFFERENCE BETWEEN TRADITIONAL AND EXPERIENTIAL

MARKETING................................................................................................10

7. FEW CASE STUDIES.....................................................................................12

1) NIKE- Experiential Marketing strategy for growth.....................................12

2)Calvin Klein, the CK Couple, the First Worldwide Store Opening...............13

3)ING Vysya: Treat Money Well .......................................................................14

4)Titan launches India's first watch experience Zone....................................16

5)HUL's appetite- experiments in marketing.......................................................17

8. EXPERIENTIAL MARKETING IN NEWS......................................................18

1)Sensory branding is one way to stay ahead in mind-game..............................18

2)Ogilvy & Mather and JWT create first-of-a-kind shopper and experiential

marketing agency..............................................................................................20

9. BIBLIOGRAPHY...........................................................................................21

3

TRADITIONAL MARKETING

Marketing is the process of performing market research, selling products and/or services to customers and promoting them via advertising to further enhance sales. It generates the strategy that underlies sales techniques, business communication, and business developments.

Traditional marketing operates based on the following strategies:

The Four Ps- Worship them:

The 'Four Ps' or the 'marketing mix' is a cliché with every marketer. Formulated by Jerome McCarthy, the 'Four Ps' refers to the four factors that a marketer has to consider before launching a product or offering a service. The marketing mix comprises of Product, Price, Promotion and Place.

Segmentation- Categorize your audience:

In traditional marketing, the market is segmented into many subsets or segments depending on geographic, demographic, psycho graphic and behavioral variables. Each segment is homogenous and responds in a particular way to a particular marketing strategy. A product is aimed at a particular segment and is launched only after thorough market research and consumer research on the segment.

Advertising and Promotion:

Marketing plans and strategies finally end in advertising. For it is advertising which exposes the product to the world and places it in a platform for the target customer to view. It gives the product visibility and helps boosts its sales.

4

THE SHIFT FROM TRADITIONAL TO EXPERIENTIAL MARKETING

Traditional marketing, unlike New Marketing, is Company-focused and product-based. It intends only to increase the visibility of the Company and its brand. The message conveyed to the customer is Company-controlled and motivated unlike in new marketing, which is Consumer-focused and attuned to consumer's interests.

When the world shifts gears and operates in a faster pace, it is advisable for us also to follow its lead and take up the trend. Traditional Marketing, say many market analysts, fails to work in today's world. The brand recall is very minimal as the customer is exposed to a variety of brands. It is these drawbacks that have encouraged a new form of marketing i.e. Experiential Marketing.

The shift towards Experiential Marketing has occurred as a result of three simultaneous developments in the broader business environment:-

The Omnipresence of Information Technology. Nowadays business is increasingly driven by information technology. It will mean a transformation in media - from print to voice, from sight to sound. It is quite conceivable that within a few years, consumers will be working with considerably smaller-and cheaper- computing devices that will integrate mobile phones, television, voice-operated computer with access to anyone and anything-real or virtual - anywhere in the world.

The Supremacy of the Brand - Through advancements in information technology, information about brands - in all different forms and media - will be available instantly and globally. Even things we do not traditionally think of as brands are now being treated and marketed as such. Examples include U.S. business schools, TV stations and programs, medical practices and even nursing homes. Moreover, daring brand extensions are occurring everywhere.

The Ubiquity of Communications and Entertainment As everything is becoming branded; everything becomes a form of communication and entertainment. Companies are getting better and better at dressing themselves as "customer-" and "community-oriented" and spare no efforts to provide fun and entertainment for their customers. The latest annual reports and corporate websites are full of terms like "customer," "connection," and "stimulation" orbiting around you in bright colors.

5

WHAT IS EXPERIENTIAL MARKETING?

As a unique approach to the task of marketing goods and services, experiential marketing is a concept that integrates elements of emotions, logic, and general thought processes to connect with the consumer. The goal of experiential marketing is to establish the connection in such a way that the consumer responds to a product offering based on both emotional and rational response levels.

Appealing to a variety of senses, experiential marketing seeks to tap into that special place within consumers that has to do with inspiring thoughts about comfort and pleasure, as well as inspiring a sense of practicality. This means that the marketer needs to have a firm grasp on the mindset of the target audience he or she wishes to attract. By understanding what the consumer is likely to think and feel, it is possible to get an idea of how to steer the customer in a direction that will relate with the product, and entice individuals to act on that impulse to purchase.

Process Involved In Experiential Marketing

In order to engage in experiential marketing, it is necessary to engage as many of the senses as possible. Striking displays with powerful visual elements, such as websites, and visual media such as print ads should not only be visually appealing, but also conjure up daydreams of

6

locales and reminders of sensations that are enjoyable to the individual. When used to create customer experiences of this nature, a sense of rapport between the product and the consumer is established that helps to make the good or service more desirable with each encounter.

NEED FOR EXPERIENTIAL MARKETING

Marketers are now faced with intense competition at one hand and a media clutter on the other hand. These issues are going to aggravate in the years to come. Differentiation will become difficult and if at all brands can create differentiation, communicating the uniqueness will become even more difficult.

It is in this scenario that experiential marketing becomes relevant. According to Professor Kevin Lane Keller, Experiential marketing promotes product by not only communicating a product’s features and benefits but also connecting it with unique and interesting experiences.

Traditionally, experiential marketing was appealing to those products and services that have high experience attributes. Experience attributes are those attributes which cannot be evaluated by consumers before purchase. Consumers have to experience those attributes in order to evaluate or form opinion about it. For example, resorts, holiday packages, Spas etc are products that have high experience attributes. Marketers have to market those products/services by taking the customer through the product experience. Communicating experience attributes is one of the most difficult tasks in marketing communication.

As the consumers are moving towards an experience eco-system, marketers of all kinds of products and services should be willing to embrace the concept of experiential marketing. There are many forces that are driving this experience economy. Consumers are now exposed to a wide range of products and services. This exposure has enabled them to see beyond the marketing communication originated from the brand.

Another factor that is driving the trend towards experience is the clutter. When the product features remains the same, consumers tend to bias their purchase decisions towards those products that offer them a better experience.

Experience can happen at different levels. According to Bernd Schmitt of Columbia University, how the brands sense, feel, think, act and relate have a strong impact on the way the brands are perceived by the consumers (Journal of Marketing Management, 1999). Marketers can think about engaging with the consumers only if they are able to connect with the consumers across these five critical experience points.

In order to create an effective customer experience, marketers need to think beyond product categories. Categories are increasingly becoming irrelevant as far as consumers are concerned. Technological innovations are enabling firms to create products that transcends beyond

7

boundaries. The focus is on the consumer’s needs and wants rather than creating a new product within a specified category.

Most of the product marketers are confused about building an experience around the physical product. How is it possible to create an experience when the consumers purchase products from retail outlets and consumes it at their own convenience?

In such a scenario, one method is to create a consumption experience in the mind of the consumer that will compliment the real consumption experience. For example, Cadbury Dairy Milk is a brand which successfully created a consumption experience in the mind of the consumer. From the product – chocolate, the brand has moved from the physical characteristics of taste and quality to a joyful experience of consuming chocolate. The recent campaign for Cadbury Dairy Milk Silk is a classic case of creating experience in the mind of the consumer.

Another method is the engage the consumers in different platforms. HUL which is India’s largest FMCG Company recently launched a website called Be Beautiful (bebeautiful.in) as a platform to communicate with its consumers. “Be Beautiful”, unlike other brand website , is a platform for all of HUL’s personal care brands like Pond’s, Lakme, Sunsilk, Vaseline and Dove to connect with the consumer. While the consumer experiences the actual products at her home, these brands try to engage consumers and shape their experience with the brand through the website. The website offers a platform for the brand to interact directly with the consumers thus create an opportunity for experiential marketing.

While marketers think too much about using the social media for advertising and promoting their products, they miss out the opportunity to engage with the consumers and create an experience in them about the brand.

Events are also a smart way of creating brand experience and to relate to the customer. Brands like Colgate uses events like “Dental Check Up Camps” to relate to the consumer. These events not only reinforce the positioning but also give a sense of relatedness to the consumers.

The cornerstone of experiential marketing is that the entire organization should be integrated to deliver the desired experience of the consumer. Philip Kotler defines Holistic Marketing as that which is based on the development design and implementation of marketing programs, processes and activities that recognizes their breadth and interdependencies. When endeavouring into experiential marketing, the entire organization should be thinking alike, be it the operations, sales, finance or HR. Brand websites which are seldom updated, complaints not attended to properly, rude sales people, unethical corporate practices can severely undermine the experiential marketing endeavour.

8

USES OF EXPERIENTIAL MARKETING

Experiential marketing is being increasingly used to retain customers and increasing recall value

Experiential marketing helps the customer in retaining and recalling the service or product offered by companies. In other words, “Experiential marketing helps brand marketers gain valuable insight by interacting directly with consumers outside mass-media landscape”.

Experiential marketing is the next marketing methodology that can bridge the disconnect between customers' increasing demand to engage marketers and brands on their own terms and the slow-footed reluctance of traditional marketers to move away from mass-media marketing.

An experiential approach to launch a brand may be more effective and relevant than anything that television/print advertisements will offer.

For example, Mahindra Tractors wanted to launch their Hy Tec brand which was a strong hydraulic tractor aiming to help farmers saw the field.

To show this technology to the farmers they engaged them through a technique in which sensors were fixed to the hydraulic and a large LCD monitor was placed for the farmers, which captured the movement of the cultivator on an ECG graph. This activity was easily understood and remembered by the farmers and the sales graph was tremendously increased.

Experiential marketing provides experience of the brand and not just the product. The innovations, designs and concepts cut through the clutter of thousands of impressions that people are bombarded with each day. The innovative and multi-dimensional experiences create emotional resonance; strengthen the bond between Brand Identity and Brand Loyalty.

Experiential marketing- is being also used to launch a brand

An experiential approach to launch a brand may be more effective and relevant than anything that television advertisements can offer.

One of the best examples is Absolut vodka. In Australia, Absolut Vodka launched a brand called “Cut”, through a strictly experiential marketing point of view. Using public relations, point-of-sale, online and event marketing, Absolut was able to eschew traditional advertising altogether, something unheard of when launching a spirits brand.

Experiential marketing is Considered a better approach to maintain brand loyalty .

9

Since customers are more sceptical than before about marketing and advertising, and often tune out marketing messages completely, engaging in experiential marketing campaigns, brand marketers are able to gain valuable insight into this realm by interacting directly with consumers outside of the mass-media landscape.

DIFFERENCE BETWEEN TRADITIONAL AND EXPERIENTIAL MARKETING

The basis of difference between Traditional and Experiential Marketing actually lies in the areas of their focus that are summed up below:-

Basic characteristics of Traditional marketing1. Focus on Functional Features and Benefits2. Product Category and Competition are Narrowly Defined3. Customers are Viewed as Rational Decision Makers4. Methods and Tools are Analytical, Quantitative and Verbal

Basic characteristics of Experiential Marketing1. A Focus on Customer Experiences2. Focus on Consumption as a Holistic Experience3. Customers are Rational and Emotional people.4. Methods and Tools are Eclectic

EXAMPLE (to further supplement the difference)

Absolut leased two bars in Sydney and Melbourne, put on DJ sets, band concerts and photo exhibitions in these spaces. Visitors to the Absolut Cut bars got a free bottle of Cut, and consumers were given a chance to contribute their photos to the exhibits, generating what Absolut hoped would be a viral element to the campaign. The campaign flew in the face of traditional ways to launch a brand. Instead of using mass marketing to blanket the millions in order to reach the few, Absolut chose to target the few to eventually reach the masses.

10

ABSOLUT BAR- SYDNEY

ABSOLUT BAR- MELBOURNE

11

FEW CASE STUDIES

1) NIKE- Experiential Marketing strategy for growth

Sportswear giant Nike opened its new showroom in Bangalore and the major marketing theme which ranks the store higher than its peers is the Personalized Solutions it is offering.

The store has a running area where customers can get their foot scanned which will analyze pressure and generates a report on the kind of feet the jogger has and the right kind of footwear for the same.

Data suggests that Adidas stores abroad with Experience Zone sell more than regular stores. As shopping becomes an interactive experience with consumers looking for special and personalized products that suit them, stores such as these have good business potential.

Another instance where Nike has used Experiential Marketing:-

Nike's iD system, design your own shoes. Nike came up with an innovative idea to gauge customers by giving them an experience of being themselves. Customers can design their shoes according to their likes and dislikes, material, colour, shape etc… which was definitely creating an identity for themselves.

12

The BriefCalvin Klein were launching the first ever stand alone watch and jewellery boutique in the world at South Molton Street London and wanted to use guerilla marketing to raise awareness of the store launch and drive store traffic.

The ActivityThe activity was to create a CK couple to represent the brand and interact with the public. A London based search began to find the right CK couple who has the look, the personality and the ability to act out on the street. A brand new Ford Fiat was being given away as the ultimate prize. Over 15 days the CK couple would drive around in the vehicle, hang out at the new store and go "shopping" for people to invite into the store.

The Results5,000 flyers were given out to selected audiences with a 12% uptake. Over 150,000 people saw the car, interacted with the couple and received flyers about the store launch. The winner was a man from Nottingham who was presented with his prize at the official party on the 27th June.

2) ING Vysya: Treat Money Well

13

1) Calvin Klein, the CK Couple, the First Worldwide Store Opening

The company's target audience comprises high net worth individuals in SEC A1 and A2, between the ages of 25 and 65 years.

The year 2010 has witnessed many innovative and engaging campaigns at BIAL (Bengaluru International Airport Ltd). The latest to join in is ING, the global brand in banking and finance.

ING Vysya Bank recently launched its outdoor campaign, "Be Good at Money" in India. The campaign was executed across airports in cities such as Bengaluru, Hyderabad, Mumbai and New Delhi. The campaign is aimed at creating high visibility and reinforcing ING's customer focused approach.

The current campaign at BIAL is part of ING's global campaign conducted at various other airports. Here, the ING brand dominated the airport with simple messaging spread across various formats. The campaign has been executed by JCDecaux Advertising.

The multiple formats, which are spread across the airport, include lightbox, glass façade branding, wall wrapping, aerobridges, MUPI and interactive kiosk. The ING Lion has been used at the aerobridges, along with the messaging on the cubicles.

The message for the campaign is quite simple: "Be Good with Money". The objective of the campaign message is threefold -- to stimulate by triggering need; to educate by spreading knowledge and know-how; and to activate by providing purchase mechanics.

14

Pramod Bhandula, managing director, JCDecaux Advertising India says, "The best thing about the ING campaign is simplicity of the message, which goes down well with the general public. The available ambient media has been put to best use to address the travellers at all major entry and exit points of the airport, including the prominent aerobridges."

The campaign is developed based on ING's belief that inside every person is a financial pro. Thus, the campaign strives to empower people to be good at money. Thus, various messages on every outdoor creative entice travellers to know more about the bank's products and services.

As a strategy, the campaign is hosted at select airports and surroundings, and is supported by online presence, to be visible to the target group. The target audience for the company comprises high net worth individuals in SEC A1 and A2, between the ages of 25 and 65 years, who travel both nationally and internationally. The company targets both B2B and B2C segments.

15

3) Titan launches India's first watch experience Zone

yuu

Located in the “World of Titan” flagship store next to the Titan factory, the zone has five areas –– Immersion, Reflection, Engagement, Conversation and Delivery –– showcasing several new facts about the company, watches and also reveal insights about the concept of time.

Briefing reporters, company Managing Director Bhaskar Bhat said “The Titan Experience Zone has been created at the place where our first wrist watch took birth, Hosur. We have tried to capture the passion and commitment that goes into the making of a watch here and it is dedicated to the 150 million consumers who are wearing our watches.”

The zone gives visitors an opportunity to savour the “touch and feel” experience, where the concept behind the creation of each of 24 milestone watches on display was revealed on touch. In addition to this, a 3D animated hologram of the award winning Edge wrist watch showed the manufacturing process involved in the making of a watch and the high precision watch components through a special microscope.

On display are also special touch-sensitive interactive photo frames where visitors could interact with diverse gamut of individuals sharing their experience with Titan.

The 350 sq ft store zone also houses an art gallery where artists display creations inspired by the theme of time. The company is in the process of opening a new watch assembly facility in Pantnagar, Uttarakhand with an investment of Rs 10 to Rs 12 crore. The facility, which will be operational in March 2010, has a manufacturing capacity of 5 million watches per year.

16

4) HUL's appetite- experiments in marketing

In September 2010, women commuters in suburban Mumbai trains were in for a tasty surprise – they had Hindustan Unilever representatives serving out freshly cooked food prepared with Knorr Ready to Cook spice mixes. The 'Baje ki Knorr Local’ campaign touched the right chord: the aroma of piping hot food was a treat for consumers enduring hours of travel after a hard day at work.

‘Taste and see’ is HUL’s new battle cry as it tries, for the umpteenth time, to push ahead in the foods business. It managed to get 50 million consumers to sample its foods products in 2009 and the number is likely to be higher this month.

The idea is to hit at source, influence purchase decisions and propel the foods business, which has historically been a weak spot in its portfolio and has not had same level of success as enjoyed by its rivals such as ITC.

Sales of packaged processed foods such as biscuits, chocolates, ice-cream, confectionery, snacks, ready-to-eat food, cheese and butter are worth Rs 50,000-60,000 crore and growing 30-35% annually.

And HUL is taking its experiential marketing strategy everywhere—from trains to shops to homes—to make customers taste and see. It has deployed 250 food ambassadors at stores across Delhi, Mumbai, Chennai, Hyderabad and Bangalore with the help of its in-store execution partner Smollan Holdings of South Africa. Why? Because 78% of purchase decisions are made at the point of sales.

17

EXPERIENTIAL MARKETING IN NEWS

1) Sensory branding is one way to stay ahead in mind-game

The movie ‘Avatar’ achieved success, not just because it had a well-known moviemaker and it used 3-D as the technology. It became a box office hit because it also allowed the audience to touch and feel - literally. The stimulation and the sense of being in the thick of action in a fictional story is what the movie sought to achieve.

From the big screens to television, one comes across commercials by brands that look to stimulate the senses - from sight to taste to smell. But look for the same triggers on the ground and chances are brands more often than not fail the litmus test when it comes to sensory branding.

However, with consumers having access to a plethora of information, add to that the high speed of change, the thin line between real and reality and very limited time — sensorial appeal will play a vital role in enticing consumers towards brands.

And globally, there are examples of brands creating an experience that appeal to the senses. In a presentation by Lowe Counsel called ‘Sensory Extra’, auto brand Ferrari is opening Ferrari World in Abu Dhabi in 2011. “Ferrari theme park will host over 20 state-of-the-art attractions, each designed to bring various facets of the Ferrari story to life,” the presentation states.

So one will feel the rush of speed as the G-force takes over, or learn from the legends themselves in the factory or at the pit stop, the presentation adds. Yet another example of multi sensory branding is Starbucks now roasting beans in-house to enhance the authenticity of aroma in store. Nissan, the presentation adds is taking a hint from the pleasant effect of forest air on people.

Nissan studied the effects of aromas on human mental activity and “the resulting forest AC system intermittently and alternately furnishes two unique aromas, borneol and leaf alcohol, to alleviate boredom and stimulate the driver’s brain.”

Zoe Lazarus, director at Lowe Counsel says the categories, which have embraced sensory branding, and looking at neuro-marketing so far are entertainment (6-D cinemas), food (food/art experience) and travel with the advent of extreme adventure and survival holidays.

“The challenge of sensory branding is to think more broadly about how people experience products in the real world and find ways to enhance these experiences,” says Lazarus. In India, the advent of modern trade provides an opportunity of creating a sensorial experience.

So take the case of fresh fruits and vegetables within a modern trade store and it’s stacked exactly the way one will get it in the neighbourhood bazaar. That’s because consumers like to

18

touch, feel and smell the produce before the purchase. So along with the cut and packed vegetables, piles of vegetables in racks are a common sight.

Kaya, the skin clinic venture from Marico Industries started working extensively on a blue print with Pervin Ghani, a trainer on service quality behaviour and Singapore Airlines to map the consumer path in the clinic.

“The objective was to provide consistent branding cues at every sensorial touch point,” says Suvodeep Das, head - marketing, Kaya. In foods, Anup Jain, head - marketing, Pizza Hut counts store interiors and exteriors, crew uniforms and even the Pizza as elements that add to the sensorial experience.

“The most important aspect of any food service brand is the food itself. Yum uses the same basic ingredients like cheese, tomato sauce around the world to ensure taste, aroma and visual appearance of our signature pizzas is the same around the world,” says Jain.

Marketers may argue that the Indian market is still warming up to sciences like neuro-marketing and sensory branding, but observers believe that in a dynamic market which is getting increasingly crowded, getting a heads-up in sensorial appeal is a definite advantage.

Ianna Contardo, associate dean & head of neuro-marketing at SP Jain centre of Management, Dubai says the India growth-rate story naturally puts very specific type of pressures on to it, but accordingly, allows for a very granular segmentation.

When it comes to applying multi sensory branding, Contardo says there are some common fallacies. “Conventional marketing methods have been around and need not be modified, customers are willing to tell you what they want and most important, brains are closed private places,” she says. And when it comes to the brain, the sensory branding and neuro-marketing may seem as the left and right side with no bridge, but experts will tell you there are parallels.

“Sensory branding is more of the executional delivery part of the strategy, while neuro-marketing is more about the scientific study of how sensory information triggers different parts of the brain,” says Lazarus.

19

2) Ogilvy & Mather and JWT create first-of-a-kind shopper and experiential marketing agency

OgilvyAction, the activation arm of Ogilvy & Mather, and Malone Advertising, the retail marketing unit of JWT, both part of WPP Group, today announced a joint venture in North America to form the first fully integrated, end-to-end shopper marketing and experiential marketing agency.

The new venture represents the first time that clients will have access to the complete range of shopper and retail marketing services -- shopper marketing, retailer relationships, retail sales programs, consumer promotions, local and retail media and media buying, direct response advertising, planning, creative services, digital activation and experiential marketing all with deep research, analytics and measurement, from a single source.

“This move was based on client need,” said Fred Bidwell. “With all the changes in the retail space and consumer buying habits, clients told us their brands now require a wider range of resources and a truly holistic approach to shopper marketing, brand activation and integration. The joint venture is not focused on a marketing discipline, but instead on what a client needs. Then we build a media agnostic program from that base.”

“Our killer app is the ability to impact with consumer shopping experiences every step of the way: before they shop, while they are at retail, and after they leave the store with deep measurement tools,” said Sheila Hartnett. “No other single entity has that ‘before, during and after’ market capability under one roof, driving value and insight to really leverage the shopper channel for marketers.”

20

BIBLIOGRAPHY

1) http://www.exp.tv/case-studies 2) HOT COW.COM - http://www.hotcow.co.uk/Work-In-the-field-experiential-

marketing.htm3) www.wikipedia.com 4) Articles on experiential marketing from HT- http://www.hindustantimes.com/News-

Feed/columnsbusiness/The-new-age-marketing/Article1-236984.aspx5) www.wisegeek.com 6) http://ideasmarkit.blogspot.com/2007/07/experiential-marketing-some-examples.html 7) http://economictimes.indiatimes.com 8) http://www.hindustantimes.com

21