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The Rediff Business Special/ R Gopalakrishnan

India 2011

The theme of this write-up is: the return of Ayaz Peerbhoy. It is inspired by the book The Return of Martin Guerre, which is about a historian's adventure with a different way of telling about the past. It is about what happened when Martin Guerre returned after he was supposed to have died. I want to take a yesterday's eye view of the marketing world and a tomorrow's eye view of how it might appear to Ayaz if he were to return in 2011. While the latter half of the write-up will deal with the future scenario, in the first half I would like to recount the travails and romance of the journey already completed by the marketing community.

During six decades, from 1951 to 2011, one can identify fractal changes, an expressive word for bends and breaks, in the development of markets. The 20 years from 1951-71 represent the view through the eyes of Freedom's Children, the generation of Ayaz Peerbhoy. The next 20 years from 1971-91 represent the view through the eyes of Midnight's Children, the generation of Bunty Peerbhoy. The last 20 from 1991-2011 represent the view through the eyes of Liberalisation's children, the generation of Kavya Peerbhoy.

Fractals and chaos are referred to in all business literature and with increasing frequency. From a marketing point of view, the focus should be on the social environment surrounding the consumer, the market and the marketeer. I wish to use anecdotes, etc, to create the touch and feel of the times.

Ayaz Peerbhoy was inducted into the world of advertising in the late '30s. In 1951, he had completed a few years of service with JWT and sailed to the UK and the USA for further advertising training.

Between 1951 and 1971, the country added 190 million new consumers, the population going up from 360 million to 550 million. Eight out of ten Indians lived in the villages. In 1951, there were only 36,000 post offices compared to 150,00 nowadays.

Prakash Tandon wrote about those days, "Most of the administrator's innovations hardly touched the village. The villager had no one to correspond with, normally no place to go, except the nearest small town market; he was illiterate, and the nearest hospital was in the district town with no means of getting there."

Nothwithstanding this rural population profile, the nation embarked on a onesided industrialisation drive in the first few Five Year Plans. There was much rhetoric about the upliftment of the poor, though Prakash Tandon rued that "the new rulers were not particularly interested in waking up dogs that had slept for so long. They were not interested in the effective spread of education and in improving communications."

This is an interesting commentary, worth noting.

The atmosphere of the 50s is captured by the story of how Lakme began. In 1951, the Union finance minister stopped imports of foreign cosmetics because of an exchange shortage. This upset some women because no worthwhile cosmetics were made in India. The government sent for Kish Naoroji, the local director of Tatas in New Delhi and said that Tatas could expect all the assistance from the government if they would go into the cosmetics business in a big way.

The next day Kish Naoroji rang to say that Tatas would undertake the project on a priority basis. Thus was born Lakme.

I should also recall the story of Hamam soap, which had survived an onslaught from imported Lux soap in the '30s, and subsequently sold on a swadeshi platform with the slogan 'Made in India' with Indian capital and management. Paradoxically, this campaign was apparently done through a foreign advertising agency!

The entire advertising industry was worth only Rs 50 million in the early '50s. It came of age in the late '50s with the focus on explaining why imported products were not available and to emphasise that the local product was as good. In this way, the advertising industry could be said to have contributed to the chosen national policy of import substitution. JWT did a campaign for Beecham, explaining why Horlicks was in short supply. Lintas which had started operations in 1959, advertised that Lux made in India was as good as the imported one. These anecdotes recreate the atmosphere of those days.

In hindsight, what was the consequence in terms of the way the consumer spent money? There was very little shift in the pattern of private consumption expenditure between 1950 and 1970.

Firstly, consumption items took up 81 per cent of the income in 50-51 and they declined to 75 per cent only by six points in 70-71. This meant very simply that there was very little disposable income. Contrast this with the next period from 71 to 91 when it shifted by a whopping thirteen points to 62 per cent.

Likewise, essential items such as food, beverages, rent and fuel accounted for 82 per cent of consumption in 50-51, and 78 per cent after 20 years, a shift of about four points. By 90-91, these day-to-day items accounted for 64 per cent of consumption, a shift of 14 points. Clearly, something had happened in the 70s and 80s. Notwithstanding socialism, the wars with China and Pakistan, the burgeoning population and the abject poverty, a distinct shift in the consumption pattern occurred.

Why? I think the social context changed. The film industry is a good mirror of social contexts.

The '50s was a heady era just after Independence and of dreaming and gay abandon. This reflected in film titles like Awara and Shree 420, in songs like Nanne Munne Bachhe Teri Mutti Mein Kya Hai and Bekaaron Ke Hai Bahut Kam Yahan Jara Katke Jara Bachke Ye Hai Bombai Meri Jaan. Film music was inspired by the Western idiom as evidenced by the top numbers in Binaca Geet Mala. In the '60s, it changed surely and steadily to an Indian idiom.

Another big change was the food situation. For many years, India has known famines. But 1965-67 were the defining years. India needed 10 million tonnes of foodgrains import in one single year of 1965-66 and this caused the redoubtable CPI member H N Mukherji to move a resolution in the Lok Sabha. "This House is of the opinion that continued dependence on import of foodgrains under PL 480 is derogatory to our honour and injurious to our economy."

At the intellectual level, India's leaders had long recognised the centrality of food. Yet when Shastriji invited C Subramaniam to be Food and Agriculture Minister in 1964, many felt that it was a demotion, considering that Shastriji had been steel minister in the Nehru Cabinet.

Senior Cabinet ministers like Babu Rajendra Prasad, Jairamdas Daulat Ram, Kulapati Munshi and Rafi Ahmed Kidwai were thought to have lost their shine after handling the food portfolio. The onion has shown repeatedly that agriculture and food driven inflation is the worst kind.

Very appropriately, during the Budget session of 1966, C Subramaniam stated, "It is being recognised that agriculture should get the highest priority, equal to defence, not even next to defence but equal to defence, because this is the most defensive measure."

And these events led to the famous Green Revolution, which brought the long neglected rural consumer back into focus for the marketeer.

Until 1967, there had been no radio advertising. As late as 1961, Nehru inaugurated an advertising conference and publicly denounced the activity because it encouraged consumption. Information and broadcasting minister B V Keskar disapproved of film music. Sushma Swaraj did have illustrious predecessors!

When Indira Gandhi became prime minister, she found a flourishing Ameen Sayani and Radio Ceylon and an impoverished AIR. She found good administration possibilities also. Radio advertising began in 1967. Until 1971, when the first National Readership Survey of the print media took place, media planners sold plans to clients based not on readership but on circulation and complex calculations on double foolscap lined sheets. In hindsight, these provided a rational basis to an irrational decision which usually had already been made!

When the advertising curtain parted, marketeers and advertisers started to move in. Several of the HLL chairman's AGM speeches, which are a good mirror of the preoccupations of responsible business, were on consumer-related subjects. Rural marketing in India in 1969, consumer rights and aspirations in 1970, self-reliance or swaya lambanam in 1973, distribution of essential commodities in 1975 and consumerism in 1977. Thus, over 10 years from 1969-1977, the HLL speeches signalled a focus on consumers and markets, very different from the 51-71 period.

In fact, it is worth quoting a passage from the AGM speech of 1969 by Vasant Rajadhyaksha on rural marketing. "Anyone interested in marketing has for long been conscious of the vast potential that lies in rural India. The change is that this potential is now beginning to be seen as perhaps a more immediate opportunity.... Our experience in rural selling soon proved that the existence of a disposable income, although an essential pre-requisite, was not by itself sufficient, some way of motivating the villager had to be found."

I stated earlier that in the '50s, the advertising industry played its role by explaining shortages and that Made in India-Foreign when it came to quality. In the '70s and '80s, with radio and then TV media, the industry stoked consumer aspiration, as one can see from the commercials of the times.

What Ayaz Peerbhoy will see in India in 2011

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