Markathon January 2012 Edition

Dear Readers,

Another recession seems to be around the corner. The mood has been glum for quite some time. Unlike 2008, when the economy around the world seemed set to touch the sky until the bubble burst in September 2008, and there was no stopping how deep the economies fell. This time, the entire world seems prepared for it; it is almost as if everyone has given up, just waiting for the economy to take another downward spiral. The downward trend seems to have begun in a slower manner because of the fear of recession rather than recession itself. The Indian stock markets have had one of the worst years in recent history shedding more than 25% of its worth in the calendar year 2011.

The mood of the economy is visible in almost all sectors which have witnessed slower growths compared to a bullish 2010-2011. The airlines industry is in such huge losses that Air India might recover only 20 years later (if everything goes right) and there seems to be no respite for Kingfisher either. The consumer electronics industry has also seen a sharp downturn and almost all major players have reported lower sales in 2011-2012.The rising crude oil prices, burgeoning inflation and frequent interest rate changes have only added to the worry. The automobile industry has been the worst hit with net profit taking a 64% dip in Q3 compared on a Y-o-Y basis – the lowest in almost 4 years. The story is along similar lines for other companies with decreased sales owing to lesser consumer spending.

Surprisingly, the Luxury car market seems to be operating in entirely different conditions. Companies selling luxury cars in India, right from the likes of Mercedes, Audi, Jaguar and BMW have never been more upbeat about the Indian consumer. BMW has had a record year of sorts and is set to challenge Mercedes for the top spot for India’s highest selling luxury brand – a spot which Mercedes has held for more years than one can remember. Team Markathon has a brilliant analysis of this sector in this month’s cover story. We bring you detailed insights into the exact reasons behind this trend and also how some of the luxury car companies are making a beeline for India. The cover story also compares and contrasts the strategies used by the major players in the Indian market.

Our Vartalaap for this month has one of the most distinguished names in the world of Automobiles – Mr.Mayank Pareek, Executive Director of Maruti Suzuki India Limited who handles the Domestic and International sales for MSIL. He speaks to us at length about the intricacies of marketing in the automobile sector and about Maruti’s successful brands over the years. We are extremely grateful to Mr.Pareek for taking time out from his schedule to talk to Markathon. From the academia we have Mr.Praveen Kopalle, who is Professor of Marketing at Tuck Business School, Dartmouth. An expert in Pricing and Marketing Analytics, Mr.Kopalle discusses the various trends taking shape in the marketing world with respect to emergent
consumers and also about pricing perceptions. We thank Mr.Kopalle for giving Team Markathon this wonderful interview.

Sit back and enjoy this edition!
Happy Reading!
Jitesh