Start-up Marketing Strategies in India

Cover of Start-up Marketing Strategies in India

Synopsis

Table of contents

(14 chapters)

Prelims

Pages i-xiv
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Foreword

Pages xv-xix
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Abstract

The length of the debate regarding a new business idea and resource allocation between Ritu Jhajharia, Vinay Chaurasia and Sandeep Poonia on an evening in March 2016, was enough to make the piping hot pasta go cold. After much deliberation, The Rolling Circle, a Mumbai-based marketing firm concentrated on the digital marketing business arena was born with plans of potentially viable business strategies, blueprints of employee and other key resources' allocations, strategies for client procurement and vesting of some amount of investment money in initial pitches. Yet, in the last two plus years, the company has procured 40 plus clients and are looking to finish their account books with Rs. 1 crore revenue in their banks by 2018. Despite initial financial crunch, the company continued to get businesses. One day in February 2018, the resignation of co-founder Vinay Chaurasia was a blow to the foundation of the company. While clocking their best business so far and continuously growing since its inception, The Rolling Circle is now faced with one of the biggest dilemmas in the company lifecycle: in their line of business, there is neither a constant flow of clients nor a stability in terms of the employees working in the organisation; the founding team is grappling with the glaring strategic question of whether they should recruit high-profile employees in the organisation first and then continue onboarding premium clients, or they should first sign with premium clients and then look out for high-profile employees to serve those clients? Who will wait: the client or the employees?

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Board meeting was in full swing as an important announcement had been made by Manish Jain, MD FinMen Advisors Pvt. Ltd. ‘We need to get 5,000 clients by 2023’. Management board members look at each other in wonder as they have only 500 clients in 2018. ‘That's a herculean task’, says a board member, ‘Besides, the clients’ fees are reducing in our business'. Manish interrupts to suggest that it is precisely the reason they want to enhance their client base. But the board members were still not convinced. Their questions revolved around whether they are equipped enough in terms of resources and infrastructure to reach to the number suggested by Manish. There were issues in the processes and systems of the company, there were issues in employees taking onus of leading certain verticals in the company, there were no branding exercise in terms of increasing awareness about the company. On the whole, in order to reach 5,000 clients, a total revamp of processes, systems and training employees needed to be given huge emphasis. But does the company have money for revamping all these issues? ‘I don't care’, says Manish, ‘Any client in any industry looking for credit ratings should be our client’. As Manish moves out of the board room, he says to himself that he was well aware of the facts questioned by the board members. But as a person ready to take up challenge and enjoy the perils of it, Manish was not ready to reconsider any of the points raised by the members. He thought whatever has to be done, has to be done to achieve targets set by him. However, sitting in his office and thinking about the future, Manish was still on the same dilemmic question as any employee in his company: how does he achieve the figure of 5,000 clients by 2023?

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This case dates back to 2017 and revolves around three budding entrepreneurs studying in a prestigious university in Haryana. A collaborative initiative by Abhishek Ganesh and Shine Varghese Saji to make the Onam festival in their university a huge success among their fellow mates initiated their journey of entrepreneurship. The three entrepreneurs got their first lesson that students are ready for a service if it is interesting and enjoying but not at a very high price. They studied the market and observed that there was a lack of substitutes providing high-quality but affordable travel services. With the three entrepreneurs gelling successfully, they decided to form a company that offered relaxing weekend gateways at high quality but at an affordable price. So, the company, The Great Expedist came into existence as a Partnership Company under the treasurer's name, that is, Anurag Bansal and started business from 5 February 2017. The aim of the company was to provide varied experiences to their customers including adventure sports, team building activities, historical learning and a comfortable stay that delivers a unique travel experience to students at an affordable price.

As every new initiative brings challenges along with it, the entrepreneurs had to face resistance from vendors, hoteliers and even students from other universities. But with their sheer grit backed by full support from their university entrepreneurship cell, they overcame the challenges smoothly.

But the issue of pricing was of prime concern for them. With students being a price-sensitive market coupled with vendor issues, they found it difficult to earn revenues. So, they decided to opt for mark-up pricing and offered 15% mark up on the costs incurred by the company in arranging for hotel, travel and other logistic arrangements. With passage of time and enhancement of negotiation power, they decided to offer more value-oriented services at similar price points. This enhanced their profit margins due to increase in volume of sales.

The targeted promotions and positive WOM were making them popular but the issue of customised service seemed a challenge. Each student had a different set of priorities in terms of travel, stay and food offered. The company wanted to enhance their profits so either the negotiation had to be great or the price to be enhanced. This issue landed them in a dilemma. They wanted to diversify, promote and research all of which required a lot of money. They even thought of diversifying into the senior citizen category. It was a lucrative segment with huge profit margins but with its own set of huge challenges too. So, they are stuck up with a dilemma. Should they negotiate with vendors or should they increase the price of the service package? Should they stick to their current target group of students or diversify to the segment of senior citizens or a completely new segment?

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The discussion at the conference room in Blue Vector office was vibrant. None of the group members was able to come up to an answer that was consensus in nature about the route that the company would take and the capabilities that they had. The simplest questions asked in the conference room was ‘how would the company be able to take the business forward?’ There were too many options for developing new products and services, but which would be the best for which industry? Which option would make the employees enjoy their work more, while giving them more business and reputation, as well as making them contemporary to the clients? This was the debate which sparked off at 5 p.m. and continued till midnight. The product and services of the company had received huge appreciation globally but Blue Vector seemed to be more ambitious than their competitors. With a registered company in 2017, a strong team and advisors, Piyush kept on harping on the same questions: What's next for us? Are we ready for it?

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The case pertains to entrepreneurship and the struggles of microentrepreneurs in raising adequate funds. It highlights the insufficiencies in implementation of government’s financing schemes for microenterprises. The case also throws light on the difficulties faced by microentrepreneurs in raising capital through banks and more so if the entrepreneur happens to be a woman. This case revolves around a young woman microentrepreneur, from a humble background, who is determined to expand her orthopaedic-support manufacturing unit. It brings out the enormous difficulties faced by her in obtaining an adequate financing through banks despite many laid out government policies to provide relief and stability to microenterprises. The ardent pursuit and the innovatively designed marketing strategy helped the entrepreneur achieve a reasonable success, in spite of the lack of capital. Her revenue for the financial year 2014–2015 rose to Rs. 9 lakhs/per annum. Her projected revenue for 2015–2016 was Rs. 24 lakhs. The ambitious target seemed difficult if additional funds were not forthcoming. With no help from the banks, the entrepreneur was in a dilemma where to raise the funds from. Her long-term plans for growth would be badly affected.

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Every year, tonnes of flower waste from religious places is dumped into India’s holiest river Ganges, polluting it to virtual death. Pesticides and insecticides used in growing these flowers mix with the water, affecting millions of lives through water-borne diseases. Most others may just lament these facts, Ankit Agarwal and Karan Rastogi, childhood friends from Kanpur, used them as inspiration to innovate. Two years of relentless experimentation led to a brilliant idea; that of recycling the flower waste. They founded HelpUsGreen® in 2014 to convert the waste into bio-fertilisers and lifestyle products. Widely appreciated and heavily awarded now, success has not come easy for this well-educated duo. HelpUsGreen® processes hundreds of kilos of flower waste, creating employment for hundreds of underprivileged women. An entirely bootstrapped project with no carbon foot print, the venture hopes to revive the Ganges through Flowercycling®. Currently at 8.5 tonnes per day and at the tipping point of scaling, HelpUsGreen® hopes to process over 50 tonnes of flower waste per day by 2020. Apart from the environmental impact, HelpUsGreen® has achieved huge societal impact, employing over a thousand women who did not previously have formal employment. What also makes the social entrepreneurs stand apart is their entrepreneurial market savviness. They have positioned their products not at the sympathy market but at the high-end premium market. Their products sell under the name ‘Phool’. HelpUsGreen® has set its eyes firmly on spreading operations across 2,000 kilometres along the Ganges and creating over 25,000 jobs for women.

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COCO TANG India is an innovation-driven company. It takes inspiration from the humble coconut water that all of us are very familiar with and have drunk right from our childhood. The founders of the company, Dr Neelima, a dentist by profession and her husband Chaitanya who is a pharmacist have hit upon the idea of a coconut-based drink quite by accident.

When Dr Neelima was pregnant with her first child, the doctor advised her to take fresh coconut water. It was then that Dr Neelima discovered that fresh coconut water was a paradox, the water from a tender coconut is supposed to be fresh but in many cases is not as fresh as it should be. Coconuts are harvested from remote farms in Andhra Pradesh and sent to Hyderabad. And to top it all, the nutrition value of the coconut past its ideal window of consumption leaves a lot to desire. The price factor too is a dampener. It costs Rs. 25 to have tender coconut water in a metropolis like Hyderabad.

Dr Neelima and her husband developed the product idea from their search for a nutritious, healthy drink. Fresh, tender coconut pulp-based shakes, packed with nutrition, taste, health and at the same time make an aspirational product for the young, bubbly and restless youth of India.

This case deals with the problems, the trials and tribulations that these young first-time entrepreneurs faced and details the marketing efforts the young company is putting into survive in the dog eat dog world of fruit drink industry.

The case details the specific marketing-related problems the company faces and examines what the promoters are doing to overcome these problems, specifically related to the four Ps, that is, product, price, place and promotion. It looks in depth at the innovative marketing practices that COCO TANG India is deploying, including the use of the social media that enabled the COCO TANG India’s founder to win Junior Chamber International – Business Excellence Award for the year 2017–2018.

COCO TANG India is also the recipient of the Telugu book of records ‘certificate of national record’ as being the first brand to introduce Tender Coconut-based Mocktails and Milkshakes (A1).

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Catering business is one of the most prominent and sought-after business investment in Dehradun, given the number of people who have a busy lifestyle. This fact gets more influential as Shugan Group is a catering company that serves the Dehradun market, a valley in the foothills of Shivalik Mountain Range in the state of Uttarakhand. Dehradun enjoys the benefit of being the Capital of Uttarakhand. The catering companies offer a lot of employment while promising delicious food to the stakeholders. Many individuals rely on this sector through food trucks, small shops or through full-fledged catering service providing companies. The group offers innovative and interesting food options for Doonites through their catering services including a lot of regional food options. Traditionally, the catering services in the town comprises handful options to deliver in the form of just food items. The catering services now involve a lot of service elements also including serving of the dishes, ambience and all inclusive of personnel factors. Many individuals assume that mess food is everyday kind of boring food. This assumption definitely holds true throughout the student community who are the major benefactors of the catering services as Dehradun is an education hub in the country. The new food offerings therefore face a lot of change as some of the ingredients definitely are the everyday incorporated ones. In the past couple of years, the catering services concept had gained acceptance for investment because of rise in demand for variety to be provisioned in the offerings as students hold diverse demographical differences. A lot of significance has been given to the likeness of various food options. Shugan Group wishes to inject a new life into the student catering market, leveraging the culinary skills of their handpicked chefs to develop creative new catering options. The advanced skills of chefs, industry insight of the group and an already existing market opportunity will allow the group to showcase its potential. Shugan Group is a start-up company. Marketing is critical to its success and future profitability. It offers creative gourmet for mess catering for a wide range of events and everyday eating options. The basic market need is high quality and creative food options. Having worked in the industry for the past few years and witnessing the dynamic environment including rise in disposable incomes, rise in consumer awareness, consumer’s keenness to eat new delicacies every day and desire to purchase quality food, the group has invested a lot in understanding what the consumers want. The performance of the group has been moderately incremental. After holding qualitative wisdom on the requirements of the market, Shugan Group is currently in the speculative stage in terms of being a caterer. The group wishes to reasonably understand the option that it should consciously adopt in terms of being modest about thinking only of financial benefit, with reasonable expansion every year only for the sake of being financially viable or build a strong brand and start getting people to increase word of mouth thereby bringing organic growth.

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Index

Pages 233-240
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Cover of Start-up Marketing Strategies in India
DOI
10.1108/9781787567559
Publication date
2019-07-23
Editors
ISBN
978-1-78756-755-9