Friday, June 13, 2008

What is common to HP, Gillette, and Galaxy Restaurant - Kodambakkam?

In Spencer Plaza - Chennai, Gillette has set up a mega display. It has a plasma screen showing MACH III Advertisements, a massive set of speakers, using which, a balding man with a calm, gentle voice beckons people to come down and take the Mach 3 Confidence Challenge.

The challenge is simple, you fill out a form, go to the cabin's they've made and try out shaving with the new Gillette Mach 3, and you get to keep the razor, otherwise costing Rs. 315 for free. No Strings Attached.

A shopkeeper in Ritchie Street offers a high quality HP Inkjet printer for 1500 Rupees. He remembers the good old days, and the hugely popular HP DeskJet 640C, which sold for about 7000 Rupees, the print quality for the 1.5K printer is better though. He wonders how it's still profitable for the company to sell a color printer for such a low cost.

In Kodambakkam, a customer walks into a small, shady looking restaurant, he looks through a menu and orders a Paneer Butter Masala. The price, he notices, is low - even for a place like this. Maybe the Quality Or the Quantity are poor. As his order arrives, he's surprised by both. The Gravy is thick and delicious. The Quantity of Paneer isn't that great, but the curry is given in generous portions.

All the better for the customer, right?

Keep in mind that these are not philanthropic organisations. If they don't make money, they will unapologetically weeded out of existence by market forces. The former two are corporate giants, often described as money hungry bastards. Do they seem that way here?

Sure, it may look that way, But our initial impressions which govern our buying patterns don't keep into account the complementary goods that will ensure the satisfactory and long term use of the listed goods. What is meant here is the following :

  • If you're using a razor long term, you'll have to buy more blades
  • Regular Printing will use up the ink in the ink cartridges in a desktop printer, or if kept for long times without printing, dries up the ink.
  • Naturally, you won't be having just a Paneer dish.

Needless to say, all these complementary goods are proprietary, which means that there's a special MACH III blade, which only gillette has the right to produce. Only HP can produce genuine HP Printer Cartridges, and since outside food is not allowed in an eatery, you'll have rotis or rice at that particular restaurant only.

The prices for these also tell us the whole story about how they can earn money while still giving off a good first impression. A Mach 3 Cartridge is priced at Rs. 110, an HP Color cartridge costs Rs. 1400, and a single chapati is worth Rs. 15. Also, since the consumer has done the initial investment, he's psychologically "locked-in" to the product, so a majority of them won't switch to a cheaper-in-the-long-run product, even if they're budget users.

5 comments:

chaitu said...

nice one!

Eeshan said...

nice, nice to see you writing
keep up the good work :)

nimit said...

Kya mere marketing magnet ..... sahi post

me, as i am said...

reading this ages after it was posted.. neway, nice post! and awesome blog... do keep writing, post more frequently.. :)

Thejazzz said...

Chennai \m/