Drawing a fine line between a gift and a prize

Specific rules and norms are set by respective advertising standards authorities in different countries. The same are monitored by committees that keep a tab over advertising practices that can often be misleading. These bodies are independently administered and serve like a watchdog.

For example, Advertising Standards Council of India (ASCI) functions as a self regulatory voluntary organization. The role and functioning of ASCI encompasses addressing complaints received from consumers and industry against advertisements and claims that are considered as false or misleading. It is important in this context that we consider the difference, albeit subtle, between a prize (awarded to a lucky few winners) and a gift (available to all or a majority of entrants to a promotion irrespective of the fact whether they win or lose).

This distinction should always be made amply clear to consumers who are being targeted or approached through promotional offers. If all or almost all participants are entitled to an award in a promotion, it should not be termed a prize. In such a case, it may preferably be denoted as a ‘gift’, ‘reward’, ‘award’ or a similar such term as long as the context does not get misleading to consumers.
For example, promoters should not make a claim that respondents will get to ‘win’ a ‘gift’ because the terminology is improper, confusing and inconsistent. Rather state they would get to ‘win a ‘prize’ or will be ‘given a ‘gift’. Let’s take a practical case. A few years ago, the UK based Advertising Standards Authority (ASA) mulled over a peculiar promotion that involved the promoter offering several prizes and gifts.

The promoter considered that since recipients got one of two or three gifts on offer with no single gift going to ‘all or most’ of them, each gift could well be described as a prize. However, the authorities stipulated that since the vast majority of respondents would get one of two or three low-value items, they should be termed as gifts. The promoter thus had to withdraw the claim that these were rather prizes and not gifts.

So make sure that you promote the program in a proper context so that it is not perceived to be misleading consumers. In other words, drawing a fine line between a gift and a prize is vital.

Indian shoppers see no reason to hold back

Contrary to the perception and predictions of gloom and doom for global economy, marketers are bullish on Asia and India in particular. They describe these as real exciting times, presenting a great business opportunity and hence are keen to open new stores across different cities this year. Sample this:

  • Porsche Design has opened in New Delhi and already has chalked out plans to expand to other leading cities of the country. It tracks several luxury brands including Montblanc, Ferragamo and Prada; if eight of the 10 start in a particular city, it grasps the market is now ripe for it to make a foray.
  • Louis Vuitton has recorded double-digit growth in 2011, albeit from a small base. It has been a star performer not just in India but globally,” states the chief representative (Asia) for LVMH (Moët Hennessy-Louis Vuitton), Tikka Shatrujit Singh, also an advisor to the Louis Vuitton chairman.
  • Harley-Davidson has buyers from the North-east as well as Kanpur, Allahabad and other cow belt towns. Shreyans Group that retails Ferrari and Porsche claims to have sold 10 Porsches at least in Kanpur until now thanks to a discerning and affluent class there who appreciate luxury something that only the rich in top metros were known for in the past.
  • Car marques such as Porsche, Maserati and Ferrari are witnessing an impressive upsurge in demand. If the former got around 20 orders for the last six months in 2011, Porsche delivered more than 310 cars – all are customized to the buyers’ demands – in 2011, more than twice the number in the previous year.

What is really driving this trend? One reason is that a Badge consciousness perhaps reigns high. There can be few better ways of flaunting your success or new-found status than by flinging out your captivating Canali wallet during an office meeting or click-clicking in your jazzy Jimmy Choos. This tendency is clearly going to have a positive impact on gifting industry as well, which is a much welcome development in today’s apparently tough times.

How opulence, luxury and gifting go hand in hand?

Signifying the link between opulence, luxury and the gifting industry, an insightful news report points out that industrialists, businessmen and celebs are lavishly spending on a spate of ultra-luxury gifts. In fact, almost 60% of all the luxury items sold are essentially gifts, it asserts.

The news report by Ravi Teja Sharma of The ET Bureau starts off by stating: “Opulence has no limit. You can be happy with your hardworking employees and dole out a bonus for them, or you can bring in some style.” Here are the instances of the above trend, revealed as a matter of case study:

In one company, the management gave away gift vouchers of 1-2 lakh to a bunch of top performers to buy bespoke suits.

Last year, Shah Rukh Khan gifted Tag Heuer watches to all members of his Kolkata Knight Riders cricket team, when it reached the last four of the Indian Premier League.

An industrialist gave the select employees Versace mobile phones, each costing 3.5 lakh, as one top industrialist recently did to six of his senior execs for clinching a difficult deal

These gestures of generosity, as the writer mentions, may not muster support in these difficult times, but they come as a fresh lease of life for many luxury brands in India, who are now planning to expand their business. Gifts made up for 60% of luxury goods sales in 2011, as mentioned above.

The general manager at Genesis Luxury (that represents brands like Canali, Jimmy Choo and Bottega Veneta and also has a joint venture with Burberry in India), Roasie Ahluwalia, has been quoted as saying: “While many Indians have started spending on self, there are many who would still prefer someone splurge on them. It may be a matter of family bonds, which still run deep in the Indian society.”

Dynamic transformation in the gifting trends

Underlining how the gesture of a ubiquitous gift has transformed into a dazzling and dynamic trend, a news report by Ravi Teja Sharma of The ET Bureau brings out some interesting facts as follows:

  • Ten years ago, for someone to gift a luxury product would require him to travel abroad. Today, disposable incomes have risen and aspirations are high. The entry of several international brands makes it easier for the high-spender.
  • The airport stores of luxury firm Swarovski, for instance, are doing brisk business. “Our stores at airports in Delhi, Mumbai and Hyderabad are growing at 20% a year as this is the best place to pick up such gifts,” says Sukanya Dutta Roy, director, consumer goods business at Swarovski India.
  • The really high-value gifts are coming from industrialists, celebs, politicians and diplomats who are spending on gifting ultra-luxury cars and watches worth 5 lakh and even homes.
  • About 10-15% of business for luxury firm Shreyans, that sells Ferrari, Maserati, Porsche and Ducati in India, comes from gifting, says Ashish Chordia, chairman of Shreyans.
  • As part of personal gifting men are picking up iconic Alexander McQueen clutches that cost over a lakh rupees for their wives, girlfriends and others.
  • Women are gifting 50,000 cufflinks to their men. Fathers-in-law are gifting entire wardrobe makeovers for their son-in-laws.
  • Businessmen are buying expensive watches and pens to please the wily policy-makers.”We recently had a businessman gift two luxury apartments costing 5 crore and above to his daughters,” revealed the president (marketing) at Gurgaon-based M3M Group, Kunal Banerji.
  • Most luxury goods sale happens during the festival season or on occasions such as the Valentine’s Day, as this is the time when people find a reason to splurge for someone he loves or wants to reward. According to executive director of Blues Clothing Company (representing brands such as Versace, Corneliani, Cadini and John Smedley in India) Abhay Gupta, there isn’t a doubt at all sales shoot up during the October-December period, which is the festival and wedding season.

Industry puts the share of the festival revenues to overall revenues of luxury good sales in India to as much as 70%.

An elegant exercise tracking device well worth gifting

Jawbone is known for its Bluetooth headsets. The USP, launched late last year (November 2011), is its first fitness device. What are its exclusive features that make it well worth gifting. Let’s check out:

  1. Coming in the form of a small wristband, it carries a small LED light along with motor inside for vibrations for feedback. It comes with an easy-to-use app iPhone/iPod Touch users can install. When you plug the wristband into your phone, it uploads all the data into it.
  2. When you plug it into your phone, you get a simple graph of the day, with three bars on it displaying how long you’ve slept, how much you exercised and what you ate. If you meet your goals on any, there are visual cues to praise you for that bar, and if you tap the bar you can get details about that field.
  3. Its standout feature is the silent alarm that monitors if a user is in deep sleep or light sleep, and wakes him or her up by vibrating if and when the sleep is least restful, within a half-hour window around desired wake-up time. The benefit of this is you wake up easily and are able to get out of bed instead of pressing the snooze button. So, for instance, the sleep bar will expand to show details of deep sleep versus restless sleep, how long you took to sleep, how long you slept; this data can be compared across days.
  4. The interface tracks how far you’ve walked every day, and there are charts for other activities like exercising in the gym. The system takes all this into account and tracks how many calories this helped you burn. The app requires you to take a photo of every meal. Instead of making a graph against a database to display calories, it asks you to rate the food on how it makes you feel, and gives an encouraging response when you eat the foods that make you feel healthier.
  5. This gentle prompting, along with the accurate exercise tracking, is a good reason to buy the UP. The UP has a battery life of 10 days. Its exercise tracking is pretty thorough. It’s priced at roughly $100 (around Rs 5,300), plus shipping charges.

Brand is the buzzword as customers turn choosy

Gone are the times when people would aimlessly and helplessly stroll past high-end stores like Dior and Chanel, knowing the products were well out of their reach. But things have changed dramatically both in terms of buyer’s mindset and their purchasing power. The top malls in the capital city of India have witnessed a growth in footfalls by roughly 20 percent in 2011.

The positive experience of the store managers is a testimony to the fact that people are no more wary of spending huge sums on buying pricey objects – either for personal usage or for gifting purpose. In fact, conversion rates have moved up fast and hesitant window-shoppers of the past are increasingly turning into more assured buyers.

So does the slowdown not affect the up-market luxury segment? As a sales manager rightly observes, luxury is something that comes along, as these consumers are used to it. Underlining the trend, a recent article by Avantika Bhuyan and Priyanka Sharma ( ) notes: So, luxury’s indeed here to stay.

According to an estimate, the luxury market in India is roughly valued at $7.5 billion (more than Rs 37,500 crore in 2010) equates the overall consumer electronics market in terms of size. Different estimates put the Indian millionaires’ count (in equivalent dollars) at well over 100,000. However, experts feel that well can be a gross underestimation.”

Once, luxury brands noticed the trend of heavy purchases by buyers in India at their exclusive stores in Dubai, Hong Kong and Singapore, they were quick to latch onto it. They were savvy enough to know the vast marketing potential and the possibilities of exploring the opportunity that India as a country (and also as a huge marketplace) presented to them.

They have capitalized on it in a big way in recent years. The trickle-down effect of this has been felt in the gifting industry as well, moving up a notch higher in the value chain, thus increasing the glamor and luxury quotient of the products on offering!

A fascinating gift with a feminine touch

Sunflowers, lilies, orchids, roses etc, they all seem be in full bloom on the streets of Mumbai. Well, we are referring to some trendy hair accessories that have given way to new ‘flower girls’ in 2012. You may be wondering what this piece of information has got to do with gifting…Read on!!!

The point this writer is trying to make that you cannot ignore the current trends and the in-things while deciding what to gift and in which form? Now a drop of hint here: As far as hair accessories are concerned, the ravishing retro look has found another expression in them as well. You might have noticed this if take a casual stroll down the city’s main fashion alleys.

You will get to see an array of fascinating floral hair clips, hair clutches and head bands – in feather, cotton, silk, or chiffon.  The fabulous floral hair accessories – large and small, minimalist or otherwise – are clearly the fashion du jour. Most experts and ardent fashion trend watchers reveal that a maxi dress coupled with a floral hair clip can make a perfect pair.

Tie-up head bands mixed with floral accessories is also a unique fashion statement. Floral pins can well be teamed up with an outfit as a befitting brooch or they can form part of your sizzling shoes, lending a feminine touch to the overall appearance. What adds to their popularity is the wide range of captivating colors in which they are available.

You may consider hair accessories like floral head bands of all kinds to suit your woman’s look and outfit, which jell with her personality. This, I am sure, will sure warm her heart. It makes her realize that you are taking efforts to make her feel special. If one of your friends or relatives is visiting a foreign country, you can ask them to get such accessories as a memento that you may opt to gift later.

Fashion is a way of expressing your attitude. And gifting some amazing accessories on an occasion or just casually is always a nice gesture.

Upper end of the market continues to thrive amid slowdown

Has the slowdown interfered with the eclectic buyer’s appetite for high luxury? A recent article by Avantika Bhuyan & Priyanka Sharma (The Business Standard), gives an insight on the ground situation. The broad inference it draws is that there is no significant impact on the upper end of the market as far as sales are concerned.

It quotes a successful entrepreneur eager to flaunt her wealth, as saying: “I would rather buy an expensive handbag that I can carry with me through the year than a gold set for the same amount of money that I would only wear during a wedding. It is all about how you choose to spend on luxury.”

One reason for this trend could also be the fact that prices in India are now more or less the same as abroad. Three years ago, buyers would arm themselves with lists of Chanel lipstick shade numbers or Dior bag descriptions before going abroad. Today they prefer to purchase in India. The difference between Indian and global prices is kept at a bare minimum and is usually the value-added tax.

Listen to what another entrepreneur who markets luxury brands has to say on this particular issue: “The difference between Indian and international price range is rather quite small. A Louis Vuitton bag may be a bit cheaper in London, but the prices in Delhi and Bangkok are almost identical.” Same is the case with Dior handbags.

What’s holding this particular segment of the market together is the new dynamic, jet-setting generation of luxury products buyers in the age group of 21-35. As a retailer points out, this indeed is a very exciting segment, with the kind of consumer base with a fresh outlook, who is keen to show success, flaunts wealth. The young professionals are ambitious and self-driven.

As the news report mentions: “There’s the other kind of consumer segment – 37-plus, more mature and equally well established. They belong to the connoisseur category. It’s these two distinct demographics, which make Indian market an interesting one.” This is where the gifting industry needs to channelize its efforts, as well…

Luxury knows no recession

The business slowdown, the slowing economy, the sustained stock market fall (investor wealth eroded by a whopping Rs 19.5 lakh crore in 2011 as per market data of the Mumbai Stock Exchange), the dramatic fall of the rupee against the dollar, persistently high inflation, rising rates, fears of joblessness, political turmoil, and global uncertainty – in spite of so many negatives – the high end goods are still very much in demand.

Read excerpts from a recent report by Avantika Bhuyan and Priyanka Sharma (The Business Standard) that indicates how and why the niche brands are ‘very excited’ at the vast opportunity: “It’s a winter morning and one of south Delhi’s luxury malls, is just coming to life. A Mercedes-Benz E-Class and a Range Rover Sport stop; a gaggle of ladies with Jimmy Choo stilettos, Prada handbags and Chanel sunglasses emerge.

In the neighboring ubiquitous ‘mass market’ mall one can witness the less well-heeled leisurely ambling about – but these ladies, armed with a sense of purpose, have an agenda of finding the Harry Winston watch or Louis Vuitton bag. Early customers can be seen inside at the stores like Jimmy Choo and Louis Vuitton. Mention of the slowdown to their sales representatives and they grin…”

According to a sales executive at one of the Kapoor Watch Co outlets in Delhi, anyone who apparently can afford luxury watches in a price range of Rs 3 lakh & above won’t worry about inflation, the stock market crash, or the petrol price hike. They retail top brands such as Cartier, Montblanc, Omega, Longines, Rolex and Chopard.

Most luxury brands across a wide range of categories including automobiles, apparel and accessories highlight the fact that there is no sign of any slowdown in business, and no down-trading as well – a trend economists and social scientists have long amplified: luxury knows no recession. The message is loud and clear: people will continue to buy either for their own consumption or for their near and dear ones, In other words gifting as a trend will remain intact irrespective of the prevailing conditions.

Unconventional festive offerings for Sankranti

As we all know, festive occasions can be a great opportunity for companies to lure enthused customers. An interesting news report (‘Icing on the kite’ by Shreya Badola in The DNA India), refers how food and festivals tend to go hand in hand in India. Most of the festivals come with their very own special foodie feasts! The festive occasion of Makar Sankranti is no exception.

However, as the story adds, there has been not many tempting treats associated with the first major festival of the year, apart from the traditional til ladoos and khichdi. That though is fast changing thanks to several restaurants and popular food joints now coming up with unconventional Sankranti offerings like cupcakes, desserts and cakes. For example, Renaissance Mumbai Convention Centre Hotel is readying fusion sweets such as sesame & jaggery chocolate, sesame milifilli, etc.

Are you also looking to a celebrated with a host of interesting delicacies resembling activities synonymous with the festival? Well, there is no death of options – why no go for kite cakes – those with images of a child flying a kite. They are very much in demand…
The Monginis Foods marketing head, Viren Ghole, has been quoted as saying: “We’ve launched some special offerings on the eve of Makar Sankranti this year. People, not only in India but also abroad, can choose to gift the special Makar Sankranti Cake, special Til Gajak and Special Til Ladoos to their loved ones,” adding, these items are available on their website or over the counter.

DeliveryChef.in, an online food portal, has on offer pretty cupcakes and cakes. Entrepreneur Aditi Talreja, who runs the venture, mentions: “We believe in celebrating the festivals with loads of love, fun food and frolic, hence want to welcome the very first festival of the year with special cupcakes and cakes.”

Of course, there are many more unconventional sweet offerings going beyond cupcakes. The Crepe Station owner, Ravi Sharma, recommends special saffron waffles, also his personal favorite, for the occasion, apart from special winter muffins that they have also introduced…