Business Today

Southern shock

Stereotypes are easy to form but notoriously hard to break. So, when one thinks of the typical Chennai man, the image that most comes to mind is of one dressed in veshti, vibhuti smeared across his forehead, extremely conservative in his outlook and, of course, partial to rice—with sambar, ideally.

     Print Edition: December 30, 2007

Chennai men: Very different from their popular image
Chennai men
Stereotypes are easy to form but notoriously hard to break. So, when one thinks of the typical Chennai man, the image that most comes to mind is of one dressed in veshti, vibhuti smeared across his forehead, extremely conservative in his outlook and, of course, partial to rice—with sambar, ideally. As with most stereotypes, there is some truth in this, but most of it is gross exaggeration. In the case of Chennai man, that stereotype may have been truer two decades ago, but today it is less and less a reflection of what he really is. As our Indian Male Survey 2007 reveals, the Chennai man is turning out to be very different from his popular image.

Take a look at what our survey, which covered 11,370 working men across 35 towns, reveals. The man in Chennai is the most brand conscious; in fact, 71 per cent of the men polled in the city claimed to be brand conscious—the highest across the country. Even Delhi, often considered a city of show-offs, pales in comparison. Again, the men in Chennai emerge as the most materialistic in the country. Whatever happened to simple living that the godfearing men down south were known to practise? As we explain elsewhere in this issue, the three large southern capitals (Bangalore, Chennai, and Hyderabad) have been the drivers of the IT boom. Apart from creating unprecedented affluence in these cities, the IT boom has broken the relative insularity of these places.

Software engineers from across the country have poured into the southern capitals, and have as much influenced the local culture as they have been by it. A US-educated engineer son setting up a tattoo shop would have been sacrilege even in the early ’90s, and girls going out to learn salsa from a male instructor even more so. Yet, if that’s the new Chennai, then marketers must shed some of their old notions and look at it with a fresh set of eyes. Chennai is still not a city where the rich like to flaunt their wealth (most of the business families in Chennai have their passions but they tend to pursue them privately), so a Gucci or a Bulgari is not going to find a huge market for itself in the city. But there are several other neorich Chennai men who like to acquire all the good things in life, and who probably make a ready market for dozens of other marketers.

Be aggressive

RBI Governor Y.V. Reddy: Success comes at a price
RBI Governor Y.V. Reddy
Success is proving to be as difficult to handle as failure. India’s success at selling itself as a “hot” investment destination is giving Reserve Bank of India Governor Y.V. Reddy and Finance Minister P. Chidambaram headaches of the kind none of their predecessors has ever experienced. As billions of dollars chase the Indian growth story, the rupee continues to rise against the greenback. It’s already trading below Rs 40 per dollar; there is near unanimity among analysts and economists that it will rise to Rs 35 over the medium term; and some are predicting that it will rise to Rs 30.

Many people are viewing this as a crisis. Such people are both right and wrong. They are right because the Indian economy seems unprepared to deal with this massive inflow of dollars and the policy responses are inadequate, timid and even negative. Yes, small exporters, especially in the textiles and handicrafts sectors, need to be protected, not least because they are among the largest employers in the country. But active intervention to keep the rupee value artificially low cannot be a long-term solution. The government estimates that Indian infrastructure alone will need investments of $300-500 billion (Rs 12-20 lakh crore) over the next five years. A large part of this will have to come from foreign sources. The government should, therefore, do more to increase the absorptive capacity of the Indian economy. Bureaucratic red tape is still the biggest hurdle faced by foreign and domestic investors.

Then, large investments are held up in the infrastructure, telecom, banking and insurance and manufacturing sectors because of policy issues. By dragging its feet on reforming these sectors, the government is actually ensuring that too many dollars are chasing too few growth stories.

Then, the cheaper dollar is making it cheaper for Indian companies to acquire assets abroad. This should be actively encouraged. And finally, the government should immediately set up a sovereign fund with a part of its huge forex reserves. Apart from earning higher returns, it will also give the government crucial leverage in the invested companies.

If China, with a trillion-dollar foreign exchange kitty, can effectively sterilise inflows and buy influence across the world, there is no reason why India can’t do the same. All it needs is a little imagination and lots of aggression.

It’s about soft power

ICL & IPL: Cricket isn’t just about “official” matches
ICL & IPL
The figures are out, and like all statistics, are open to different interpretations. The Indian Cricket League’s inaugural tournament has delivered TRPs of 0.3-0.5. That, in itself, will not send advertisers into raptures; the ongoing India-Pakistan Test series is attracting at least five times as many eyeballs. But the real significance of those admittedly modest viewership figures lies elsewhere.

They prove, beyond any doubt, that there is a significant market for cricket outside of official sanctioned matches. ICL’s “score” is all the more creditable because its tournament comes bang in the middle of an Indo-Pakistani Test series—fast emerging as the gold standard of international cricket—in which India is hammering the stuffing out of its traditional rivals. It will be interesting to see if this figure changes in subsequent editions of the league or when India is not playing international matches.

That cricket attracts eyeballs in India is old hat. But many advertisers find it a very expensive platform. What ICL does is: it provides advertisers, who may baulk at the ultra-expensive sponsorship and spot rates associated with India-centric international matches, with an alternative.

The official Indian Premium League will kick off next year. It has the backing of the International Cricket Council and all the cricket boards around the world. So, it will get all the big stars from India, Australia, England, South Africa and the other big cricket playing nations. So, it’s a no-brainer to predict that it will be much bigger than ICL.

Together, these two tournaments will be unique, in the sense, that they will ensure that for the first time in history, India will be at the centre of an international sport. This country has been the game’s financial engine for about a decade now. But these two tournaments will, for the first time, give international superstars a stake in the game in India. Just as county cricket— which, till recently, provided employment to the best players from around the world—gave England additional clout in the game, IPL, and, to a lesser extent, ICL, will give the Indian cricket authorities unprecedented leverage in how the game is run internationally.

Also, foreign superstars signing up with Indian sponsors will give this country a great opportunity to project its “soft power” into their home countries. An example of this was in evidence when Australian fast bowler Brett Lee defended the country in the face of an international media blitz on the alleged racist behaviour against his team mate Andrew Symonds.

Yes, domestic matches they may well be. But their influence will, doubtless, be felt well beyond cricket and also beyond these shores.

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