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Gradable Assignment 1 Subject: MM Assignment -1 Question: Find examples of two Indian companies whom you believe possess the equity of a loyal customer base. Identify the reasons for their market’s unflinching loyalty. Provide your recommendations to two other brands that you opine suffer from low customer loyalty. Answer: About Customer Loyalty Customer loyalty is a combination of the customer's professed likelihood to repurchase from the same supplier in the future, and the likelihood to purchase a company’s products or services at various price points (price tolerance). Customer loyalty is the critical component of the model as it stands as a proxy for profitability. Two Indian companies whom I believe possess the equity of a loyal customer base is 1) TATA group 2) Aditya Birla Reasons for their market`s unflinching loyalty is as follows 1) TATA Group Statement by TATA: We have one great strength, which is the strength to develop products specifically for Indian needs About: The Tata group is an Indian conglomerate multinational firm, founded by Jamshedji Tata. Tata is India’s oldest and largest private sector business entity. Founded in 1868, the group now consists of more than 100 companies, with a turnover of more than $70bn. It has a wide range of interests, with companies trading in fields as diverse as steel, cars and trucks, chemicals, IT consultancy, retailing and hotels.

The Tata group is highly decentralized, and member companies have great autonomy in terms of strategy and operations. The main instrument for unifying the group is the Tata corporate brand, which embodies values that are shared by all companies in the group.

However, not all the companies use the corporate brand in the same way. Many, such as Tata Beverages and Tata Motors, use the name and logo explicitly. However, even in India some companies in the group, such as Trent and Taj Hotels, do not use the Tata name. Taj Hotels also has its own brand mark. Everyone in INDIA believes Tata products and Tata also maintains that loyalty with various initiatives, few of them are mentioned as below Tata Delight Tata Delight is a loyalty programme for all Tata Motors commercial vehicle customers, both existing and new. It offers customers a host of distinctive facilities across all Tata Motors dealerships, sales outlets, and Tata Motors Authorised Service Stations. Customers can earn bonus points on purchase of a new commercial vehicle. They can also earn or redeem points on vehicle servicing or repairs, new spares, across all Tata Motors dealerships, sales outlets, and service stations. Members can call on a 24X7 toll free helpline 1800 209 7979 for queries and on-road & highway assistance service. Other membership privileges include educational scholarships for children, a chance to win a Tata Nano every quarter through a lucky draw and invitations to special events and movies with family. A customer can avail of all these benefits for only Rs.100 (without insurance) and Rs.500 (including insurance). If enrolled for the programme with insurance, a vehicle driver will receive a 3-year insurance policy which offers an accidental insurance of Rs.1 lakh, personal disability insurance of Rs.1 lakh and an accidental hospitalisation cover of Rs.25,000 per year. Once enrolled in the programme, the member will receive a Tata Delight Owners Card and as many Tata Delight Chassis Cards as the number of vehicles a customer owns and wants to enroll for. While the Tata Delight Owners Card can be used to earn and redeem points, Tata Delight Chassis Card will only accumulate points earned against spends on the vehicle registered in the programme.

TATA IQ

Tata group made big data solution for reaching out to their customers and to improve their loyalty. A bigdata analytics co that helps make sense of data collected from customers It has been setup to help Tata cos adopt analytics for smarter decision making Tocreate one of the richest database on Indianconsumers and institutions to give insight in to how people consume products and services More than 15 Tata cos have tied up with it to solve business problems. Lasting Legacies Tata group had Lasting legacies from many years to ensure the mission and vision of the group remains consistent in the modern ages. CSR The best part of CSR at TATA is that it is a legacy started by MrJamshedji Tata. It is his vision that drives the business ethics of one of India`s conglomerates.   

TATA made CSR in big Ethics played a role building their brand Belief in giving people a livelihood, instead of money

2) Aditya Birla Group the Aditya Birla Group is in the League of Fortune 500. Anchored by an extraordinary force of over 120,000 employees, belonging to 42 nationalities. Over 50 per cent of its revenues flow from its overseas operations spanning 35 countries The Aditya Birla Group has been ranked fourth in the world and first in Asia Pacific in the 'Top Companies for Leaders' study 2011, conducted by Aon Hewitt, Fortune Magazine and RBL (a strategic HR and leadership advisory firm). The Group has topped the Nielsen's Corporate Image Monitor 2014-15 and emerged as the 'No.1 Corporate', the 'Best in Class', for the third consecutive year. Aditya Birla Group – Beyond Business The Aditya Birla Group transcends conventional barriers of business because we care. We believe it is our duty to facilitate inclusive growth as well. How we engage with our customers

aim to develop long-term relationships with our customers by aligning our sustainability agendas. We do this through our cross-functional engagement model, spearheaded by our key account management (KAM) program. KAM is designed to increase points of contact across the customer’s organization, establishing lasting partnerships of value. We track our success in this program by the extent to which our products are attractive to our customers; these engagements have also enabled us to develop timely new products to meet customer needs. Sharing sustainability strategies Transparency is key to building joint strategic sustainability approaches. We invite our customers to regularly visit our plants and offices to carry out their own audits and process reviews. Our customers highly value a secure supply, which we meet with our Business Continuity strategy and Enterprise Risk Management approach. In FY2017, we held customer dialogue events.

Two Indian companies whom I opine suffering from low customer loyalty are Shoppers Stop and AgriGold 1) Shoppers Stop Shoppers stop`s Loyalty Programs are too complex to understand i.e. what all benefits are attached to it, process to redeem the points, exclusive benefits to members etc Also their loyalty programs are Limited validity of reward points make it un-attractive. Firstly, the value of each point on an average is just 25-30 paise on purchase of 100 Rs&inorderto redeem against decent purchase one need atleast 500-600 points therefore in order to accumulate 500 points, oneshud shop for approx 1.5 Lac. Secondly, if one will not utilize the points in financial year then they will lapse. Its a smart strategy from retailer but at the end of the day, he is cutting the branch on which he is sitting. Recommendations:   

Opportunities should for all levels of Loyal Customers Reward Earning Period should be Long Enough Rewards should be simpler when they should be to redeem

2) Agrigold Agrigold has got very bad position in their customers loyalty and the reason is agriGold scam is a Rs 7,000 crore interstate scam in which nearly 32 lakh poor depositors from

Andhra Pradesh, Tamil Nadu, Telangana and Karnataka states were duped. The company was set up in 1995 as a Collective Investment Scheme (CIS). For the next 20 years, the company lured several lakh customers on the promise that their investment would come back to them with higher returns.

Recommendations:  Being liberal With Payout  Support to Treat High Value Customers efficiently  Being ethical to society and respectful to customers effort and money  Keeping the promise Conclusion India is vast country with varied shopping habits of Indian Customer. The marketeers working for Loyalty Programs need to understand the ground realities & consumer behavior, in order to make these programs successful in India

References: http://www.tata.com/article/inside/I36Z3LIM9ec=/TLYVr3YPkMU= https://economictimes.indiatimes.com/news/company/corporate-trends/tata-group-sifts-datafor-customer-loyalty-programme/articleshow/57658135.cms https://www.indiainfoline.com/article/news/tata-motors-launches-customer-loyaltyprogramme-tata-delight-5156640951_1.html https://www.ft.com/content/8e553742-136c-11e0-a367-00144feabdc0 http://www.adityabirla.com/about-us/overview http://sustainability.birlacarbon.com/customers-and-suppliers/customer-engagement.html http://www.icsi.org.in/icsi-methodology/ http://www.icsi.org.in/measure-customer-satisfaction/2015/11/3/customer-satisfaction-inindia https://forteconsultancy.wordpress.com/2011/02/28/loyalty-programs-gone-wrong%E2%80%93-ten-common-mistakes-to-avoid/

https://www.nitinbhatia.in/marketing-case-study/7-reasons-why-loyalty-reward-programsfailed-in-india/...