Xed CA Marketing Newsletter Week July 28 03 Aug

8/3/2019 Xed CA Marketing Newsletter Week July 28 03 Aug

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11 Pages 28th JULY 2011 03rd AUG 2011 www.xedintellect.com

BUSINESS NEWS

ECONOMIC INDICATORS 2 COVER STORY 3 PERSONALITIES OF THE WEEK 4 BUSINESS NEWS 5-8

INTERNATIONAL NEWS 9 MISCELLANEOUS NEWS 10 GENERAL AWARENESS 11

NEWS DIGEST

IN BRIEF

PERSONALITIES OF TH

WEEK

COMPILED BY

CORPORATE

INTELLEGENCE

BSE SENSEX 17,940

NSE NIFTY 5,402

RS/$ 44.37

(as on 03rd AUG 2011)

ECONOMIC

INDICATOR

India set to fund

European bailouts

COVER STORY

MARKETING NEWS

Cairn India accorded

superbrand status

GLOBAL & MISC NEWS

Iran says oil

payment row with

India resolved

XED NEWSLETTER a weekly news bulletin

US: SUBMERGED IN DEBT


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TOP 10 HEADLINES OF THE WEEK

1. India set to fund European bailouts.2. Indians do not like to be indebted: Keki Mistry, CEO, HDFC.3. ITC to invest Rs 5,000 crore for buying shares of rival FMCG: YC Deveshwar.4. Air Indias 38,000 staff not paid salaries for months, forced to borrow, sell assets.5. Burgernomics and Indian Exports.6. Just a Day to Start a Business.7. Iran says oil payment row with India resolved.8. Foxconn assembles iPads & iPhones in China plans use 1 mn robots in 3 yrs to cut labor cost.9. Lokpal bill cleared, PM not in ambit.10.New draft Land Acquisition Bill

ECONOMIC INDICATORS

THE GLOBAL TOURISM

As the northern hemisphere passes through theheight of summer, millions of tourists are jetting offon holiday.

International tourist arrivals last year reached theihighest total yet of 940m, according to the UnitedNations World Tourism Organization.

Data gathered by the organization, fromnational statistics, give France as the mostcommon destination for foreign tourists,

with 76m visitors in 2010. But the $46bnit makes from them is not enough for aplace on our list of countries that makethe most from each tourist.

When calculated as the total of touristreceipts divided by the total number ofarrivals, several geographically isolatedcountries fare well. This may be becauseholidaymakers will stay longer and fork outmore on a long-distance trip.

Stock Market Indices as on 03rdAug11 Values

BSE SENSEX 17,940

NSE (NIFTY) 5,402

Current Market Rates as on 03rdAug11 Values

Rupee/US Dollar 44.37

Rupee/Pound 72.20


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COVER STORY-US: SUBMERGED IN DEBT

What is Debt ceiling: To start at the most basic level, countries like individuals are able to borrow money to financespending. A government debt is held in the form of bonds, and the governmentsells these bonds in the market, promising to pay a level of interest over a setperiod of time, after which they repay the money to the person or company whoowns that bond.

US Government has a borrowing limit of $US14.3 tn and interest repayments ofabout $US200 bn a year. That limit was reached in May but extended until Aug

2. The current proposal is to lift the debt ceiling by $US2 tn of which $900 bn wilbe raised immediately and in return to cut up to $US2.5 tn in spending by 2021.

What does the US do with all the money it borrows: The US Governmenincreased its mandatory spending by 15 % ($US2.17 tn) last year mainly on social security, Medicare and Medicaidprograms as well as interest repayments. Discretionary spending increased by 14 % ($US1.34 tn) with increasedspending on defence the biggest item ($US663 bn). As the US population ages, spending on health and social securityas a percentage of GDP is expected to rise from about 5 % to between 6 and 10 % of GDP in the next 20 years.

How the crisis occurred: The 2008 global financial crisis created a fragile US economy and caused governmentspending to soar while tax revenues dropped. This has caused a big rise in the government's deficit (its annual debt)The crisis is a political one. Republicans control the House of Representatives and they want to bring the deficit backunder control through spending cuts but without raising taxes. President Barack Obama's Democrats want to shieldhealthcare and pension programs from cuts and raise taxes.

Where US gets its money from: China is the biggest lender to the US, owning $US1.16tn worth of US Treasury bonds at May 2011. This is followed by Japan ($US912 bn),Britain ($US346 bn) and oil exporting countries such as Saudi Arabia, Ecuador, Venezuela,Indonesia, Bahrain, Iran and Iraq. US taxpayers own Government bonds throughinvestment funds, banks, major securities brokers & through most of the world's biggestfinancial institutions that use US Treasuries with their AAA rating as collateral to borrow.

Why US cant live without Debt? Though the debt ceiling has been raised, the equalamount of cut in the spending mandated can put US on the back foot at a time when it issuffering from one of its biggest employment crisis ever. It desperately needs to inject more money in the economyinstead of strangulating it with its austere measures like spending cuts. Supposedly US doesnt have enough money.In such scenario it is left with two choices. The first is to start prioritizing which payments the governmenmakes; currently only 60% of US spending is financed by taxation while 40% coming from debt. Therefore the Obama

administration would have to find a way of delaying 40% of their expenditure, by cutting back on the healthcarereforms and delaying the payment of benefits, which leaves the government open to significant legal challenges bythose entitled to benefits.

The other option is however even more scary, the possibility that the US defaults on its payments. This works ina very similar way to your credit card. You are required to pay off a certain amount each month,if you simply don't have the money to, however, you can default and not pay but this comeswith severe penalties and a downgrading of your credit score. In a similar way, if the Obamaadministration is unable to continue paying the interest on the bonds its issued, then it facescatastrophic problems, with its perfect triple A credit rating lost which means that any futuredebt becomes more expensive.

And this isn't just a risk for America, everyone right across the world will be hit by it. If youneed evidence, look at the 2008 economic crisis. It wasn't problems in England, Britain or even

Europe which caused the recession; it was a collapse in confidence in the US financial market. Adefault on debt by the US government would do exactly the same thing, plunging scores of countries back intorecession. However, if the US administration responds to the alarming sluggishness of the US economy with morequantitative easing (that is, printing money by buying back assets such as bonds to inject cash and confidence intothe financial system) then all bets may be off. Quantitative easing may, or may not, have succeeded in saving thefinancial system butit surehas distorted investment markets by creating a bubble in UK and US government bonds.

Held to Ransom:To most Americans and the rest of the world, the policies of Tea party which orchestrated the deais beyond comprehension and referred to as voodoo economics. The intent behind deficit-reduction is no doubtpragmatic but the means to achieve so- i.e., through spending cuts- is being considered outrageous. Punditscomment, If you really want to cut debt, you need to put more money to spur growth which eventually will generaterevenue and cut the deficit. However, it remains to be seen who is proved right. Only problem is, its not just the USthat will face the consequences but the whole world.


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PERSONALITIES OF THE WEEK

C.K. Prahalad: Management guru with varied interests-Known for being a management guru the late C.K.Prahalad had varied interests from writingto teaching to business. As a thinker, his contribution to the field of management isirreplaceable. He is the father of concepts like Core Competence and Bottom of thePyramid that became the guiding force for many business ventures. His major ideas areabout core competencies of the organization and leveraging on it and the idea of looking atthe poor as a source of profit than as an object of charity.

Getting a foothold:C.K.Prahalad was born in the town of Coimbatore in Tamil Nadu. He studied physics at theUniversity of Madras. He worked as a manager in a branch of the Union Carbide batterycompany, before continuing his education in the United States, and earning a PhD fromHarvard. He taught in India and America, eventually joining the faculty of the University ofMichigan's Business School, where he held the Harvey C Fruehauf chair of Business Administration.

Carving the path ahead:At Ann Arbor, University of Michigan, he met Gary Hamel, then a young international business student. Theircollaboration ultimately resulted in the bestselling, Competing for the Future (1994). In his book (written with VenkatRamaswamy), The Future of Competition (2004), C.K. Prahalad argued that companies have not made enough use ofthe opportunities provided by globalization. There is an inability to realize that not only have the rules of the gamechanged but the role of the players has been transformed too. The 'customer' is a more powerful and pro-activefigure. Customers are no longer abstractions that have to be satisfied. Thanks to the internet, they are agents

creating and participating in transactions. The concept of value has also changed. It is not inherent in products orservices. It can't be instilled by producers or providers. It has to be co-created with consumers. They build this byexperiencing it. The only way companies can compete successfully is through building new strategic capital.Alongside this work, Prahalad had been wrestling with the perplexingly complex and political issue of poverty. This ledhim to write The Fortune at the Bottom of the Pyramid (2004) in which he identified the world's poor (the 'bottom ofthe pyramid') as a potential untapped market for companies, worth anything up to $13 trillion a year. He believed"The real source of market promise is not the wealthy few in the developing world, or even the emerging middle-income consumers. It is the billions of aspiring poor who are joining the market economy for the first time"

C.K.Prahalad was insightful and definitely provocative resulting, in an interesting combination of an academic and apractitioner.

Joseph Eugene Stiglitz: The HonorableJoseph Stiglitzan American economist and a professor at Columbia University is a recipient of

the Nobel Memorial Prize in Economic Sciences (2001) and the John Bates ClarkMedal (1979). He has been the former Senior Vice President and Chief Economist ofthe World Bank. He is known for his critical view of the management of globalization, free-market economists (whom he calls "free market fundamentalists") and some internationalinstitutions like the International Monetary Fund and the World Bank.

Against the consensus:Stiglitz did research on efficiency wages, and helped create what became known asthe "Shapiro-Stiglitz model"to explain why there is unemployment even in equilibrium, whywages are not bid down sufficiently by job seekers (in the absence of minimum wages) sothat everyone who wants a job finds one. Stiglitz joined the Clinton Administration in1993, serving first as a member during 1993-1995, and then as Chairman of the Council ofEconomic Advisers during 1995-1997, in which capacity he also served as a member of the cabinet.

Along with his technical economic publications (he has published over 300 technical articles), Stiglitz is the author ofbooks on issues from patent law to abuses in international trade. He has authored books like Globalization and ItsDiscontents where he argues that what are often called "developing economies" are, in fact, not developing at all, andputs much of the blame on the IMF. The book The Three Trillion Dollar War examines the full cost o f the Iraq Warincluding many hidden costs. The book also discusses the extent to which these costs will be imposed for many yearsto come, paying special attention to the enormous expenditures that will be required to care for very large numbers ofwounded veterans. Stiglitz was openly critical of George W. Bush at the time the book was released.

Another book written by Stiglitz is Making Globalization Work in which he surveys the inequities of the globaleconomy, and the mechanisms by which developed countries exert an excessive influence over developing nationsDr. Stiglitz argues that through tariffs, subsidies, an over-complex patent system and pollution, the world is beingboth economically and politically destabilized. Joseph Stiglitz has always challenged traditional western thinkers andhis literature generally tends to support the East.


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BUSINESS NEWS

1) India set to fund European bailouts- TOI 3 AugIndia is set to fund bailouts in financially-stricken Europe, marking a dramatic rolereversal from 20 years ago when it went knocking on the doors of the InternationalMonetary Fund to avert a balance of payments crisis. The government on Tuesdaysought parliamentary approval to provide over Rs 9,003 crore (over $2 billion) inloans to the multilateral agencys New Arrangements to Borrow, a fund whosecorpus was raised to over $500 billion in March when the crisis in Europe showed nosigns of abating.

So, from Greece, which has received $300 billion so far, to Portugals $100 billionbailout, India could be playing a part in the international rescue operations. Thereare already suggestions that more funding would be required from the European

Union as well as multilateral bodies.

2) Indians do not like to be indebted: Keki Mistry, CEO, HDFC- TOI 31 JulyIndia has a huge shortage of housing & mortgages are only 9% of GDP. In the US everyone has ahouse & mortgages are 84% of their GDP. On the face of it little has changed at HDFC from thetime of liberalization . But at the same time, the subtle changes are hard to miss as well. Forinstance, what began as a metro-centric lender in the '70s today generates most of its businessfrom smaller cities with average loans of little over Rs 18 lakh. The biggest change is, however, inthe scale of business without a corresponding increase in costs, which has made the company thedarling of investors. In the '90s, its 727 employees manned 24 branches and brought in an

average profit of Rs 3.3 lakh per employee. Today, its headcount is 1,607-a little more thandouble-but branch network has grown nine times and the profit per employee stands at around Rs 2.44 crore. As onJune 2011, the company's loan book amounted to Rs 1,24,100 crore. Even with this scale the company has beengrowing loans at an average of 25%.

3) ITC to invest Rs 5,000 crore for buying shares of rival FMCG: YC Deveshwar- ET 30 JulyITC plans to invest up to Rs 5,000 crore buying shares of its rivals across sectors itoperates in, its chairman YC Deveshwar said. "We currently have liquidity in ourbooks to the tune of Rs 4,000-5,000 crore of funds. We would like to deploy it asequity investments in sectors where we operate, have a thorough understandingand hence feel safer about our investment," he told newsmen after the company's100th AGM here on Friday. The cigarettes-to-hotels conglomerate will look at awide range of rival companies in FMCG, IT and agri-products for treasuryinvestment. ITC also plans to get into dairy business, making pasteurised milk,

milk powder, cheese, milk chocolates and butter, Deveshwar told the AGM. "It'sactually a compliment to rivals if we invest in them. As far as I know, some ofthem are actually happy with our investment," said Deveshwar. ITC's investmenin East India Hotels (EIH) and Hotel Leela venture have yielded handsome returns.

4) Air Indias 38,000 staff not paid salaries for months, forced to borrow, sell assets- ET 28 JulyAir India staff forced to borrow, sell assets & brace for tougher times as salaries are notpaid. The 40-year-old Air India Staff Colony Consumers Cooperative Society providesmonthly household goods to some 8,000 employees of the national carrier residing in thesuburban Mumbai colony. In good times, the cooperative would provide credit, includingfunds to take capital goods on hire purchase, to the tune of 35 lakh every month to some4,000 members. The money would be deducted from monthly salaries. But these areturbulent times for Air India, which is bleeding losses of a little over 20 crore a day.Employees have not been paid for two monthsand the salary for July looks uncertain.

Some are selling gold and jewellery, two-wheelers and even considering selling homes to make ends meet.

5) Burgernomics and Indian Exports- ET 1 AugWhy are Indian exports surging (up 46% during Apr-Jun 2011) when the rupee is at a3-year high against the US dollar? Its because the most quoted exchange rate of therupee ( versus $) is also the most misleading right now. In real terms, the rupee isactually one of the most undervalued currency in the world. The famous Big Mac indexproves this conclusively.

Developed by The Economist 25 years ago, the Big Mac index uses the price oMcDonalds burger in different countries to construct an informal (but surprisingly accurate) indicator of real exchangerate. India, which makes a debut in the index this week, has one of the most undervalued currencies vis-a-vis thedollareven more than the Chinese Yuan. As The Economist says, its fast food for thought.


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6) Just a Day to Start a Business- ET 29 JulyFrom August 1 it will take just 24 hours to start a company doing everything thats neededonline. As India completes 20 years of reforms, another barrier comes down. India has eased itsrules to allow companies to be set up in a day. In starting businesses, we may come up to speedwith the best (see graphic). Kishore Biyani took almost three months to incorporate PantaloonRetail; Tulsi Tanti a month to float Suzlon Energy; Ramesh Chauhan took ages. Kiran MazumdarShaw says she did it in a record time of three months in 1978. But come August 1, reportsApurv Gupta from Mumbai, entrepreneurs dreaming about walking in their footsteps can float acompany in exactly 24 hours, doing everything thats needed online.

7) Bharti Airtel proposes up to Rs 70 crore pay package for Sunil Mittal- ET 1 AugTelecom giant Bharti Airtel today proposed an annual pay package of up to Rs 70 crore for its chiefSunil Mittal, besides other benefits, while seeking its shareholders' nod for his remuneration. Theproposed package would be more than double his last fiscal remuneration of Rs 27.5 crore, which isnearly three-fourth or about 76 per cent of the combined pay package of the company's aldirectors in fiscal ended March 31, 2011.

As per Bharti Airtel's annual report, released today, Mittal's remuneration rose by about Rs 4 croreor 17 per cent from his 2009-2010 fiscal's package of Rs 23.5 crore. Bharti Airtel also sought itsshareholders' approval for re-appointment of Mittal as its Managing Director for another five years

with effect from October 1, 2011, at a remuneration package of up to Rs 70 crore besides other benefits.

8) Jhunjhunwala to Give Away 25% of Wealth- ET 3 JulyRakesh Jhunjhunwala, Indias most famous investor, has pledged to give away 25% of his wealth

during his lifetime. He is the fourth Indian businessperson after Azim Premji, Shiv Nadar andGM Rao to make a statement of intent to give away a substantial part of their personal wealthto philanthropy.

Announcing this on Monday evening at an event organized by GiveIndia, a giving facilitator, the51-year-old said he planned to route all his charity through his R Jhunjhunwala Foundation. Hehas set a 2020 corpus target of $1 billion (about 4,400 crore) for his foundation, which is currently inactiveJhunjhunwala declined to quantify his net worth, but Forbes magazine, in 2008, had ranked him 1,062 among theworlds richest, with an estimated wealth of $1 billion.Often referred to as Indias Buffett, Jhunjhunwala picks uplarge stakes in companies he thinks have a competitive advantage, ability to scale up, and good management. In hisgiving, he now joins Buffett.

9) Those who were buying 2-wheelers are now purchasing bicycles'- The Hindu Business Line 31 JulyMr Pankaj C. Munjal, Managing Director of one of the oldest bicycle manufacturers in India, is upbeat

about the growth in demand for the common man's vehicle'. The 49-year-old head of Hero MotorsLtd and Hero Cycles Ltd graduated in science and went on for specialized training in automotivemanufacturing at General Motors Institute, Flint, US. In an interview with Business Line, Mr Munjatalks about his company's journey so far and future plans.

From a modest beginning of mere 639 bicycles in 1956, Hero Cycles now produces over 18,500cycles a day and has an annual turnover of Rs 1,700 crore. The company employs close to 5,500people and is the market leader, with 48 per cent share of the Indian market. We are known for fair

bargain and reliability. Our huge service network is a big plus. Our manufacturing plant in Ludhiana is the largestbicycle manufacturing plant in the world we sell 5.4 million cycles out of current Indian market size 12 million cycles,manufactured at Ludhiana.

10) 98.5% of inhabited Indian villages have public telephones: TRAI- ET 1 AugNew data released by telecom regulator Trai shows that 98.5 per cent of the inhabited villages

in the country had village public telephone connections as of the end of the quarter endedMarch 31, 2011. There are 5,93,731 inhabited villages in India as per the Census 2001. At theend of March, 2011, 98.5 per cent of the total inhabited villages in India were connected tophone networks through VPTs, as per the Trai report.

The number of VPTs increased from 5.81 lakh in December, 2010, to 5.85 lakh as of thequarter ended March, 2011. Himachal Pradesh has the highest rural tele-density of 70.23(connections per 100 people), followed by Punjab (56.92), Kerala (53.25), Haryana (51.23) and Tamil Nadu (48.92,including Chennai). Bihar continues to have the lowest rural tele-density of 21.86, followed by Madhya Pradesh(22.92). Idea continues to be the service provider with the highest proportion of rural subscribers to its totasubscriber base and this proportion rose to 51.62 per cent at the end of the March quarter from 49.73 per cent at theend of December, 2010.


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11) Sebi makes it easier to take over companies-TOI 29 JulyA slew of new rules by SEBI make it easier to acquire a company and make iteasier & safer for small investors to access the markets. Market regulatorSecurities and Exchange Board of India (Sebi) has announced a slew ofmeasures that can have far-reaching implications for the market, making iteasier to acquire a company, helping mutual funds get more retail investorsand making it easier and safer for small investors to access the markets.

The game changer for India Inc, however, is the change in the almost 15-year-old takeover rules, which will now enable companies to buy up to 25%

in another company without triggering the mandatory open offer. Currentlythis trigger is at 15%. The regulator also said that after the new takeoverrules become effective, the acquirer will have to buy a further 26% stake in

the acquiring company through an open offer, up from 20% now.

12) Hang on inactive users- The Hindu Business Line 27 JulyThe Department of Telecom will ask telecom operators to weed out inactive mobile users ina bid to free up mobile numbers. According to the telecom regulator, there are 840 millionmobile subscribers of whom only about 588 million users are active. However, the operatorscontinue to count the inactive users as subscribers, thus blocking the numbers allocated tothem. DoT wants mobile companies to cancel 252mn inactive users out of 840 mn users tofree up mobile numbers or else we move to the 11digit series. But the problem is that thecurrent National Numbering Plan 2003 was designed for 750 million connections, including450 million mobile users, and was expected to last till 2030. This has come under severe

strain, with mobile numbers crossing the mark in 2009 itself. We are going to allocatenumbering resources based on the active subscriber base.

13) Cos junk videoconferencing for life-like experience offered by new tech- ET 29 JulyIndia Inc boardrooms and workspaces are using telepresence applications that arebecoming less expensive (as low as . 20 lakh), more accessible (available ondesktops, tablets and handhelds) and more intuitive (through the use of robotics).Companies such as L&T, Vedanta, Infosys and P&G are slowly junkingvideoconference systems in favour of full-fledged telepresence suites. To theuninitiated, telepresence provides an immersive communications experience to theparticipants complete with high-definition video and audio, multiple cameras withmotion sensors, life-sized images of participants, and a controlled environmentThis simulates a face-to-face encounter far better than any videoconference evermanaged to. Simply put, telepresence is the super-deluxe version of

videoconferencing. Telepresence systems now cost $200,000-500,000 and thereturns kick in from savings in air tickets and hotel expenses and higher productivity.

14) Online survey firm dupes investors of 1,300 crore- ET 31 JulyIn an operation that unfolded in Indore, the economic offences wing of theMumbai police arresteda Singapore-based pyramid-marketing companyinthe wee hours of Friday for allegedly perpetrating a nationwide scamamounting to Rs 1,320 crore. Three other senior members of the companywere also arrested but not the CEO who, the police say, is hiding in Dubai. Thefirm, which claims to have 12 lakh clients across the country, has also beenaccused of transferring more than Rs 700 crore to Singapore.

15) Bad roads a pain in the back: Docs- TOI 29 JulyBack problems and slipped discs caused or aggravated by the citys abominable roads have

become the bane of Mumbaikars existence. Orthopaedics in public hospitals say that everyday at least 10% of their patients are being treated for bad backs caused because they haveto commute for long hours on pothole-ridden roads. Orthopaedics, gynaecologists andgeneral practitioners have noticed a rise in the number of Mumbaikars complaining ofmoderate to severe back aches. Dr Hemant Thacker, who consults in many south Mumbahospitals, says every rainy season the number of back problem cases rises. Motorists fromthe city and the larger metropolitan region are expressing their anger at the poor conditionof the roads by refusing to pay toll. Mumbai: Its not just the elderly, those with existingback problems, or pregnant women who have to be extra careful. The condition of our roadsis so bad that even people who never felt a twinge of pain in their backs have begun to

suffer from slipped discs.


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16) Girl child campaign may get star support-TOI 31 JulyThe state government, in a bid to bolster its girl child campaign, has approached star BollywoodcoupleKajol and Ajay Devgnto be the brand ambassadors for the state health departmentsdrive. Ajay and Kajol are believed to have consented to the proposal informally.

Minister for public health Suresh Shetty, said sources, wanted a Bollywood couple with a girlchild and a noncontroversial image. There has been a sharp decline in the girl-boy ratio in thestate in the last decade. The child sex ratio figures of 1991 Census show 946 girls per 1,000boys. In 2011, this dropped to 833 girls per 1,000 boys. Beed district in Marathwada region registered a drop of 93girls per 1,000 boys in the last decade. The child sex ratio in Beed was 894 girls per 1,000 boys in 2001 as against

801 girls in 2011. Besides Ajay and Kajol, the state government has already roped in prominent Marathi film industryactor Sachin Pilgaonkar and wife Supriya as brand ambassadors for save the girl child campaign. They are popularin rural parts of the state, said an official.

17) As Media Ratchets up Pressure 24x7, UPA Brings on Its G7- TOI 1 AugBetween them, these seven ministers run nine ministries. Yet, at noon every weekday, theyleave their ministries and assemble at the conference room on the fifth floor of Shastri Bhavan,home to the information and broadcasting ministry, to take on an additional responsibilityManaging the media. They meet for about an hour to decide issues of the day, who will handlewhat, and what will they say to the media. For the rest of the day, whenever needed, theseministers represent the government on their respective issues in the media, be it at pressbriefings or in TV debates.

The group was formed in early-May in the aftermath of the Anna Hazare anticorruption agitation. This is the first time

an Indian government has institutionalized media management in this manner, where a group of ministers discussand present a collective front. Home Minister P Chidambaram, one of the seven ministers, says the objectives havebeen partially met.

18) IT, ITeS Workers Running Out of Space- TOI 3 AugIts 9.30 am and theres near commotion at a building in Gurgaon that houses off shoringunits of US firms. The parking is full employees are being turned away and there are longqueues that snake their way to the elevators. The lifts themselves are packed to the gills.Inside an office, employees sit within sniffing distance of each other. Cubicles have made wayfor linear sitting, and the office does not look too different from a factory shop floor.

Lavatories are few, and it isnt uncommon to spot a line outside them. The scene at thecafeteria is not much different from that at the parking lot. Welcome to just another day at a typical small or medium-sized IT outsourcing company. Under pressure from their clients, or parent organizations, to reduce bills amid

increasing rentals and employee salaries, these IT-enabled services (ITeS) firms are taking stringent measures to cutcosts. They are reducing space per employee, and decreasing the size of common areas like cafeterias and conferencerooms. At a clutch of ITeS companies, office space is being shared between IT workers and the call centre workforce(as the latter work the late shift to synchronize with US timings).

19) India tells EU Nations to commit visa numbers for Indian professionals- ET 3 AugIndia has sought a commitment from each of the 27 member-nations of the European Union on thenumber of Indian professionals they would allow to migrate every year in sectors of its interest.While India has agreed to bring down duties on a large number of goods from the EU countries,including automobiles and liquor, as part of the free trade agreement, it is conditional upon thecountry gaining "substantially" in the services pact, the official said. For instance, India sees a lot ofscope for Indian accountants in the UK and IT professionals in France, and it has sought access forthem accordingly.

Countries in Europe have their own numerical limits on foreign workers and tax structure, but mostgive visas only to corporate transferees and business visitors and do not allow access to individual professionals andcontractual service providers. European countries do not recognize qualifications gained in India and also apply theeconomic needs test (ENT) in many cases where the hiring company has to prove that the post cannot be filled byEuropean citizens.

20) Tata Motors launches three variants of crossover SUV Aria-TNN 02 AugThe country's largest auto player Tata Motors today rolled out three variants of its recentlylaunched crossover SUV, the Aria. "The Aria 4x2 is launched in three trim levels - the AriaPrestige at the top-end, the Aria Pleasure and the Aria Pure at the lower-end," Tata Motorsmanaging director Indian operations PM Telang said in a release here today. The Aria 4x2 rangewill be available from Rs 11.61 lakh onwards (ex-showroom, Delhi). The Aria range along withthe 4x2 range is being made available, in 85 cities through 150 showrooms, the release said.


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INTERNATIONAL NEWS

21) Iran says oil payment row with India resolved- Reuters31 JulyIran's oil payments row with India has been resolved before any interruption in crude exports toits second-biggest customer, the Iranian Oil Ministry's website SHANA said on SundayHalkbank, Indian refiners are expected to clear over $5 billion of debts built up with Iran duringa lengthy U.S.-inspired payment impasse. "After intensive talks between India and Iran, bothsides agreed to clear the debt promptly," Ahmad Ghalebani, head of the National Iranian Oil Co.(NIOC), told SHANA.

India and Iran have been looking for ways for New Delhi to pay for some 400,000 barrels per day of Iranian crude, or12 percent of India's oil demand, since the Reserve Bank of India halted a clearing mechanism under U.S. pressurelast December.

22) Foxconn assembles iPads & iPhones in China plans use 1 mn robots in 3 yrs to cut labor cost- ET 3 AugTaiwan's Foxconn Technology Group, known for assembling Apple's iPhones and iPads in China,plans to use more robots, with one report saying the company will use one million of them in thenext three years, to cope with rising labor costs. Fox conn's move highlights an increasing trendtoward automation among Chinese companies as labor issues such as high-profile strikes andworkers' suicides plague firms in sectors from autos to technology.

Contract manufacturers such as Foxconn, which also counts Dell, Hewlett-Packard and Nokiaamong its clients, are moving parts of their manufacturing to inland Chinese cities or otheremerging markets. Foxconn, which has been plagued by a spate of workers' suicides in its Chinese factories since last

year, plans to use the robots for simple assembly line procedures, the statement quoted its chairman Gou as saying.

23) US is 'parasite' on global economy: Russian Prime Minister Vladimir Putin- ET 3 AugRussian Prime Minister Vladimir Putin accused the United States on Monday of living beyond itsmeans "like a parasite" on the global economy and said dollar dominance was a threat to thefinancial markets. US President Barack Obama earlier announced a last-ditch deal to cut about$2.4 trillion from the US deficit over a decade avoid a crushing debt default and stave off therisk that the nation's AAA credit rating would be downgraded.

Putin, who has often criticized the United States' foreign exchange policy, noted that Russiaholds a large amount of US bonds and treasuries. US-Russian ties soured during Putin's 2000-2008 presidency but have warmed significantly since his protege and successor President

Dmitry Medvedev responded to Obama's stated desire for a "reset" in bilateral relations.

24) DEBT RIPPLE IMFs lending corpus has grown 10-fold on G20 push- TOI 3 AugOver the past two years, amid increased stress in the global economy, the InternationalMonetary Fund has been pressed into service on several occasions and has financedbailouts in European countries facing a crisis due to high levels of debt.

The 10-fold rise in the New Arrangements to Borrow (NAB) corpus was the result of thenew global financing order created by G20, a group of the worlds most powerfuleconomies, in the post-financial crisis era. Along with the jump in corpus, membership tothe elite club of NAB contributors was also expanded to include 13 emerging economies,which included India. While the US was the principal donor, chipping in with $100 billion, its largesse was notappreciated at home when the funding was given. Since then, the worlds largest economy has itself had to deal witha crisis over the Obama administration and Congress logjam on borrowing ceiling and spending cuts.

25) Pakistan relying too much on China against U.S.-Reuters 02 AugPakistan's quick response to charges by China that militants involved in attacks in Xinjianghad trained on its soil shows the importance of its ties with Beijing, but it could be amistake for Islamabad if it relies too much on China.Pakistan immediately dispatched Lieutenant-General Ahmed Shuja Pasha, director generaof Pakistan's powerful Inter-Services Intelligence (ISI) spy agency, to Beijing after Islamicmilitants mounted a weekend attack that left 11 people dead in the western region ofXinjiang, according to media reports.

"We cannot allow Pakistani territory to be used for any activities against any neighbour,especially a close ally like China," said Mushahid Hussain Sayed, Chairman of the Pakistan-China Institute. The United States rarely gets that level of cooperation when it presses

Pakistan on militants operating in its border regions. American officials for years said al Qaeda leader Osama binLaden, killed in a U.S. raid in Pakistan in May, was hiding in the country.


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MISCELLANEOUS NEWS

26) Lokpal bill cleared, PM not in ambit Asian Age 29 JulyThe Union Cabinet on Thursday decided to keep the office of the prime minister outside thefold of the proposed Lokpal, overruling Prime Minister Manmohan Singh himself. Thedeliberations spread over two hours saw Singh make a strong argument for the inclusion ofhis office in the Lokpals ambit, only to run into resistance from the overwhelmingmajority. The governments decision met with a sharp attack from civil society activist AnnaHazare who announced that he would go ahead with his fast from August 16 and demandedthat the government bill be withdrawn.

The revised draft provides for the majority of the 9-member Lokpal to be drawn fromamong people with a legal background: a concession to the argument that the quasi-judicialbody will require people with understanding of law and legal practices. In another significant addition, any trust orbody, including NGOs that receive public funds, will come under the Lokpals scrutiny.

27) New draft Land Acquisition Bill -Business Today 30 JulyThe new draft Land Acquisition Bill proposes that the Government will not acquire land for privatecompanies for private purposes or multi-cropped irrigated land. Companies will have to buy itthemselves at 6 times the market rates The draft Bill says that the public purpose once statedcannot be changed. But it also says that if the land is not used in five years for the purpose forwhich it is acquired, it should be returned to the original owner. Most of such land is in Punjab,Haryana, West Bengal, Bihar and poll-bound Uttar Pradesh, which has become a political hotspot onland acquisition issues. Called the Draft National Land Acquisition and Rehabilitation & ResettlementBill, 2011, it proposes a comprehensive compensation policy. In the urban areas, the amount

should be not less than twice that of the market rate, whereas in the rural areas, it should be notless than six times the original market value. Among its other salient features is a comprehensiverehabilitation package for land-owners and livelihood losers, including the landless, particularly theScheduled Tribes that are primarily dependent on the land being acquired.

28) Abbreviated expressions make their way into everyday communication- ET 28 JulyTwitter lingo like, TMI (too much information), IMHO (in my humble opinion) & TBH (to behonest) now part of Oxford Dictionary. If you thought TMI and IMHO are abbreviations used onlyby Facebook-obsessed Gen Z, you are wrong, TBH. Such Internet usages are now part of theofficial Oxford English Dictionary and are creeping into corporate communication. For the Twitteruninitiated, TMI is too much information, IMHO is in my humble opinion and TBH is to behonest. And they are getting into corporate lingo, as PepsiCo India Executive Director(Marketing) Deepika Warrier says. Languages change with time. Such words are being frequently used in our internal informal communication as it saves time, Warrier says.

She expects these words to gradually make their way into formal communication. With the cult ofsocial networking sites such as Facebook, Twitter and now Google+ catching up, abbreviated expressions used widelyin chats and Tweets started making into the online format of Oxford English Dictionary in March.

29) Job Satisfaction Just Temporary- TOI 30 JulyYoung Indian employees have no hang-ups about job security and are increasingly switchingpermanent jobs for temporary roles offering better money, career profile and quicker rise tothe top. As many as 15% new recruits of temp staffing firm Teamlease are permanentemployees switching to temp jobs, company officials say. The development suggests that forthe first time, the Indian workforce is putting opportunity ahead of security. The carrots better career profile, money and organisation brand. Younger employees have a higher riskappetite in terms of job movement. A shift such as this can give the employee exposure tonew growth areas, experience of working on cutting-edge technology and an opportunity toget absorbed as a permanent employee eventually, says Sudhakar Balakrishnan

managing director & CEO of Adecco India

30) Mining mafia paid of Karnataka CM Yeddyurappas family- TOI 28 JulyIn a stunning finding that could blunt the BJPs attack on the Congress on corruption, KarnatakaLokayukta, Justice Santosh Hegde, has said chief minister B S Yeddyurappas family got illegalpayoffs from a mining company to hasten clearance of pending applications. Not just this, hehas recommended criminal proceedings against Yeddyurappa and some of hisministers. Lokayukta pegs loss to Exchequer at Rs16,000cr. BJP Asks CM to resign. JusticeHegdes second report, released on Wednesday, pegs losses suffered by the state exchequerdue to illegal mining over four years (2006-2010) at Rs 16,085 crore and recommends that theamount be recovered from those who caused itpoliticians, officials and companies. The reportalso seeks criminal action against three ministersG Janardhana Reddy, G Karunakara Reddy and B Sriramulu.


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CORPORATE INTELLIGENCE

THE ESSAR GROUP

Head Quarters: Mumbai

Revenue:US$20 billion

Group Statistics:The Essar Group has operations in more than 25 countries across five continents and employs75,000 people. The group companies are well diversified across core economic sectors of steel, oil & gas, power,

communications & business process outsourcing (BPO), shipping, ports & logistics, projects and minerals. Otherventures include those in publishing, agribusiness, realty and financial services.

Group Companies: Essar Steel a steel manufacturing company with fully integrated operations from iron-oremining to steel retail outlets; Essar Energy plc a low-cost, integrated energy company with US$12 billion worth ofassets across the power and oil & gas industries; Essar Oil & Gas involved in exploration, production and retail oOil with offshore and onshore oil & gas blocks worldwide; Essar PowerIndias second largest power generationcompany in the private sector; Essar Shipping Limited an integrated logistics solution provider with investmentsin logistics services, sea transportation and oilfield drilling; Essar Ports Limited develops, owns and operates portsand terminals and is Indias second-largest private sector port and terminal company by capacity; Essar ProjectsLimited an engineering, procurement and construction (EPC) company; Essar Communications a global playewith presence in telecom services, consumer durables and IT and BPO services; Essar Minerals owns iron ore andcoal mines in India, Indonesia, Mozambique and the USA.

Key People:Shashi Ruia (Chairman);Ravi Ruia (Vice-Chairman)

Essars Humble Beginnings:In 1956, Nandkishore Ruia, father of Shashi and RavRuia, began undertaking independent contract works (mostly in the construction andshipping businesses) under the name of Essar Construction and Carriers Ltd. namedEssar after the first letters of his sons' names S and R. After the death of NandkishoreRuia in 1969, his sons laid the foundation of the Essar Group which began its operationswith the construction of an outer breakwater in Chennai port. Capitalizing on emerging

business opportunities, it became Indias first private company to buy a tanker in 1976. The Group also invested in adiverse shipping fleet and oilrigs, when the Government of India opened up the shipping and drilling businesses toprivate players in the 1980s. In the 1990s, Essar began its steelmaking business by setting up Indias first spongeiron plant in Hazira, a coastal town in Gujarat. The Group went on to build a pellet plant in Visakhapatnam, andeventually a fully integrated steel plant in Hazira. Through the 1990s, with the gradual liberalization of the Indian

economy, Essar diversified its shipping fleet, started oil & gas exploration and production, laid the foundation of its oirefinery at Vadinar, Gujarat, and set up a power plant near the steel complex in Hazira. Essar also entered the GSMtelephony business in 1995, establishing Indias first mobile phone service in Delhi (branded Essar Cellphone) withSwiss PTT as the joint venture partner.

The Essar Group Today:Having started out as a construction company, theEssar group today is a multinational conglomerate growing through strategicglobal acquisitions & partnerships. Its flagship Essar Steel is a global steelproducer having manufacturing facilities in India, Indonesia, Canada & NorthAmerica and a capacity of 14 million tonnes per annum. It operates specializedplants to manufacture value-added products like plates and pipes. It is also aleader in cold rolled, galvanized and pre-coated steel products. Essar Power hasa current generation capacity of 1,600 MW spread across five power plants inIndia and Canada. While Essar Communications has over 140 million subscribers

in India, Kenya, Uganda and Congo, Aegis - Essar's BPO arm - serves Fortune500 companies across 10 countries through 47 delivery centers.

INTELLIGENCE BYTES:

Essar Energy plc, was listed on the London Stock Exchange in 2010 following a highly successful Initial Public Offer(IPO), the second largest overseas IPO ever floated by a company of Indian origin.Essar Oils 300,000 barrels-per stream-day refinery located at Vadinar, Gujrat has processed more than 32 varietiesof crude (Vadinar receives almost 70% of Indias crude imports).Essar has brought all its retailing arms -- The MobileStore and The ElectronicStore which retail mobile & consumerdurables and IT products, Essar Hypermarket which retails steel and fuel retail operations of Essar Oil under EssarRetail, having a combined turnover of $1.5 billion.On 1 Aug, 2011, Essar Energy completed the $350 million takeover of UK's second-largest refinery, popularly knownas Stanlow refinery, from global major Shell. The acquisition gives Essar direct access to the UK market.


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MARKETING NEWS

1.Cairn India accorded 'Superbrand' status ET 28 JulyCairn India, the firm that gave the country its largest onland oil discovery in more than twodecades, was today accorded the 'Superbrand' status. While the membership of this exclusiveassociation/club of brands is by invitation only and comprises global giants from acrosscategories like consumer, business and luxury, this accreditation puts Cairn India in the eliteclub of other oil and gas peers like Reliance, ONGC and technical company like L&T.Superbrands as a concept started in the United Kingdom in 1993 and is a global powerhouse ofan invitation only collective of the most impactful brands, which have made an impression in

business and society over the decades.

2.Marico eyes beauty and wellness segment in Asia, Africa ET 28 JulyFMCG firm Marico which posted a consolidated net profit of Rs 85 crore for thequarter ended June 30, 2011 today said it was tapping business opportunities in thebeauty and wellness segment in the emerging nations."We are interested in expanding our footprint in the beauty and wellness segmentin developing countries, especially in Asia and Africa. We believe this segment willgrow significantly in future," Marico CEO, Consumer Products Business, SaugataGupta, told PTI here.

3.Godrej bets big on innovative technology - ET 28 JulyGodrej Appliances is planning to weave its growth strategy around convergence otwo products into one device. In last couple of years, the company has successfullyconverged refrigerator with in-built FM radio and MP3 player and LCD TVs withgaming consoles. Now the company plans to apply similar technology in airconditioners and microwaves. "We have not decided yet about the product mixBut we will soon come up with innovative product lines in microwaves and airconditioners range," said Godrej Appliances executive vice president (sales &marketing) Kamal Nandi. The convergence strategy so far has benefited thecompany. That is the reason the company invests 5% of its total turnover ininnovation and research & development. "Due to convergence, our market share inrefrigerator segment has gone up from 20% to 25%. We expect similar growth inthe sale of LCD also when we launch our television range pan India," he said.

4. Old Wine, New Bottle BS 29 JulyCadbury 5 Stars new campaign screams about its new packaging.Billboards and TV commercials highlight the chocolate bars iconic goldwrapper and five stars. Its yet another case of a product revisiting itspackaging in order to stay relevant. Most brands that undergo apackaging makeover silently ring in the change. Others bring inproduct or image changes and then go to town with a comprehensivecampaign. In Cadbury 5 Stars case, what draws ones attention is thatan entire campaign has been crafted to sell only the new packaging. Godrej Hershey vice president (marketing)Mahesh Kanchan feels in a category like confectionery and snack food which is driven by impulse purchase, thisbecomes particularly important. Cadbury 5 Star seems to have treaded the redesign waters with care, feel experts. Itis an incremental change, but Indian purchase is largely driven by visual cues, says Alpana Parida, president, DYWorks.

5.Merc in search of a sporty, young image BS 29 JulyAfter 15 years of unrivalled presence, Mercedes Benz is seeing competition heat upfrom compatriots BMW and Audi in the luxury car market in India. Despite a stronggrowth in sales, the company lost the top slot to much younger rival BMW in the lasttwo years. So when Peter Honegg assumed charge as managing director and chiefexecutive officer, Mercedes Benz India, in January this year, he was given a specificmandate. Apart from revving up sales, Honegg is to revitalize and project Mercedes

as sporty young brand for the youth. To give the brand a sporty perception in India, Honegg further plans to leveragethe association Mercedes has with the Formula One (F1). We are the only other company to be in F1, apart fromFerrari. But few in India know of our association with motorsports, says Honegg. To draw in enthusiasts, MBIL islooking at selling F1 tickets through the companys dealerships as India gets ready to host the worlds most adrenalinethumping motorsport event for the first time in Delhi in October.


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6.Shift in product mix boosts HUL performance The Hindu Business Line 28 JulyHindustan Unilever (HUL) managed to improve its sales growth trajectory andkeep its profits growing in the latest June quarter, but that wasn't enough to excitethe stock market. The sales growth of 15 per cent in its domestic FMCG businesswas superior to the March quarter (14 per cent) and pretty good in light of what itsmuch smaller rivals delivered. While the above numbers signal business-as-usualfor the company, there were a few interesting takeaways from the segment-wiseresults. One, soaps and detergents and personal products, HUL's bread-and-buttercategories have accelerated their sales growth rates. Given that peers in thesecategories have not grown as strongly, this could be a sign of market share gains

for HUL. Two, the jump in personal product sales had a salutary effect on margins,with this segment now contributing well over half (54 per cent) of HUL's profitsbefore interest and taxes, while soaps and detergents contribute less than a third.If this trend persists, that will be good news for HUL as it will have made a successful shift in its product mix towardshigher margin-earning categories that also enjoy better pricing power.

7.Tatas Croma to start retailing online - The Hindu Business Line 31 July

Tata Group firm Infiniti Retail that runs consumer durables and electronics chain

of stores under Croma brand today said it will soon start selling products

online. Besides the new initiative, the company is also expanding presence of

Croma stores with plans to open around 10 new outlets by the end of this fisca

and also strengthen after sales service infrastructure.Online sales are catching

up in a big way in India. We will soon launch a new portal with some unique

features to cater to consumers making purchases online, the Infiniti RetaiManaging Director and CEO, Mr Ajit Joshi said. He said the company is

considering options like cash-on-delivery to make it easier for consumers to

shop online.

8.Brands cashing in on children making more mature decisions - The Hindu Business Line 29 JulyIt's not just about buying backpacks or books or even bicycles. While a few yearsago, children decided which brand of chocochip cookies to buy or the exact shadeof burgundy that should go on the drawing room walls, today's kids are potentialdecision-makers about adult decisions such as where their parents can park theirmoney or where families can live. School contact programmes in India are gettingmore adult' in the products/services that they are helping sell. Traditionally,marketers have used the pester power of children to reach out to parents. FMCGgiant Britannia has used school contact programmes extensively for its Treat

brand. Therefore, reaching out to a large audience such as school children in aconcentrated manner has become a science with instances of repetitive low-engagement activities fast diminishing.

9. Rising footfall sees Shoppers Stop expanding - The Hindu Business Line 29 JulyWith the average purchase ticket size increasing and customer footfalls backon track, K Raheja-owned Shoppers Stop has said the right merchandisemix and same-store growth is fuelling growth. Armed with a budget of Rs350-400 crore for the next four years to expand its outlets, the companysaid its biggest thrust would be on making its loss-making entity, Hypercity,profitable.The average ticket size has gone up by at least 10 per cent ascompared to last year. Customer entry too has increased by 26 per cent.The sentiment is positive for setting up new stores, Mr Govind Shrikhande,

Customer Care Associate and Managing Director, Shoppers Stop, told Business Line.

10. LG, Samsung, Onida and Videocon roll out exclusive models of consumer durables for modern retailand small shops ET 01 AugustConsumer electronics makers LG, Videocon, Onida and Samsung are rolling outexclusive models for big retailers, initiating a strategy to differentiate products soldin large chains from those sold in small shops. Marketers expect this move to putto rest small merchants' complaint that they are not able to compete with bigchains like Croma, Future Group and Reliance Digital who often do heavydiscounting in prices because their trade margins are double. Modern retail chains,on an average, get double the margin compared to neighbourhood stores. "Withsuch a strategy, we are able to increase the average selling price in modern retail,which ensures our margins, and ensures that price comparison with rest of thechannel is avoided,.


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11. Marriott tweaks brands for Indian customers - The Hindu Business Line 30 JulyMarriott International has tweaked its Courtyard and Fairfield Inn brands to suit theneeds of the Indian customer. The company, which inaugurated its 7th business hoteproperty Courtyard by Marriot in Pune and has 18 more under construction across thecountry, has also announced the launch of its economy brand Fairfield Inn in India. TheCourtyard looks different in the US. Here, we have added an executive lounge and freehigh speed Internet, Mr Craig Smith, COO & VP, Marriott International- Asia-Pacific andAustralia, said, adding that a team from the US had spent six months researching theneeds of the local client before the features for Fairfield Inn were finalised.

12. Ready for a larger share BS 01 AugustToshiba Corporation, the Japanese electronics and consumer products company, has bigplans for India. To this end, Toshiba India, the Indian subsidiary of Toshiba Corporation, hasunveiled a slew of new products, a new business strategy and a new ad campaign to capturea larger share of the lucrative Indian market. The pivot of its India strategy is theintroduction of products designed for the country. Take Power TV, a light and compact rangeof LCD TVs that profess lower power consumption. Starting at Rs 10,000 for a 19-inchscreen, it goes on to a little over Rs 20,000 for the 32-inch variant. The prices have beenkept significantly low to achieve the ambitious target of capturing 10 per cent market shareby 2012 and 15 per cent by 2015. We want to get closer to consumers at the earliest ascompetition is getting intense, Wu Tengguo, director, digital products, Toshiba India, says.In this market Toshiba will fight with the likes of Sony, LG and Samsung. The company hasplanned an aggressive marketing and advertising strategy to support the new products. It will drive visibility withbillboards and print ads.

13. Gilded ambition BS 01 AugustThe Gitanjali Group (Gitanjali) has reworked its corporate imagery to reflect its growth strategyStarting its journey in 1966 as a processor of rough diamonds for the jewellery trade at Surat,Gujarat, it currently manufactures and retails gold and diamond jewellery, apart from owning achain of lifestyle stores. The journey has made Gitanjali Group Managing Director Mehul Choksbelieve that Gitanjali can become the largest luxury brand from India. We believe that the nexgiant in luxury, on the lines of Louis Vuitton, will be from either India or China because of theirmanufacturing prowess. It can very well be jewellery-led and Gitanjali will be a strongcontender, he says. While an extensive rejig in business operations is being done by KPMG, acosmetic change to reflect Gitanjalis ambitions was unveiled recently.

14. Baskin-Robbins in search of distribution flavor BS 03 AugustPremium ice-cream retailer Baskin-Robbins is giving its stores a face lift to increase

footfalls. This is in line with the global repositioning exercise We make people happywhich will slowly trickle into India. Stores will now don a happier look where walls anddisplay windows will be adorned with graphics and messages that showcase happymoments. The staid menu displays are being replaced with back lit menus to makethe store environment livelier. The changes at the 400 stores (franchise owned) in100 cities is already underway and will take place in a phased manner. To engagefurther with consumers, Baskin-Robbins will invest significantly on the digital platform.The India website will see a makeover. Also in the pipeline is a loyalty program whichwill be test marketed in select cities. The ice-cream market in India, however, is atough one to crack. The biggest challenge is changing the way Indians consume ice-cream. Even though parlours as a segment is fast growing, on Tuesday, 60 percent of volume sales in the Rs 1500crore (organised) market happens through impulse purchases (smaller packs sold in vending carts). The other issue isthat the parlour segment is extremely fragmented.

15. Creativity in marketing helps position business in crowded market The Hindu Business Line 02 AugustCreativity in marketing is the ability to position the business with new and differenviewpoints in a crowded market, according to Mr V. Narayanan, StrategyConsultant and Corporate Trainer. He was delivering the Business Line Club lectureon Creativity in marketing' for the MBA students of Srinivas Institute oManagement Studies in Mangalore on Tuesday. The Business Line Club lecture wassponsored by Syndicate Bank. Speaking on the occasion, he said creativity inmarketing is not about right and wrong. It is about right and new. It is full ofinvention, innovation and imagination. Mr Narayanan said that marketing basicallyis creating customers at a profit. On the ways to improve creativity in marketing,he said there is a need to imagine widely and wildly. This will help strategise out othe box. He said the fear of being rejected is one of the blockers for creativity in

marketing. The tendency to ignore intuitions and to adopt it won't work attitude' are also seen as blockers.

Xed CA Marketing Newsletter Week July 28 03 Aug

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