The Indian market is a maze for retail companies, trying to find the best routes to reach everywhere the consumer shops. Yet, reaching the market physically is not enough.
Connecting the market digitally has become the ask for sustainability. In this conversation with Bizom, Mr. Vikram Singh and Mr. Varun Bansal from Philips India, talk to our Growth Officer, Akshay Fotedar, on how data is driving efficiency in the Philips distribution system and about their digital transformation journey with Bizom, for building a more sustainable data-driven future.
Akshay – Welcome to another Bizom podcast where we sit with CPG industry leaders and listen to the journey of brands that have shaped global retail. In today’s show, we talk to a company that came to India, much before most of us were born. Starting in a pre-independent India, Philips has really stood true to its tagline – Innovation and You, making every consumer’s life more innovatively comfortable.
Today, we’re going to listen to more about this growth story with Mr. Varun Bansal, and Mr. Vikram Singh. Vikram heads the General Trade at Philips India, and Varun is the lead IT Business Partner at Philips India.
Hey guys. It’s great to have you here.
Vikram – Hey Akshay, thanks. Thanks for having us here.
Akshay – I’ll be honest, Uh, today morning, I was thinking about where we could start this conversation. So I looked around and saw a lot of Philips products in my home, some of which have been with me for a really long time. Philips has really connected the whole healthcare experience in a consumer’s life. It’s not just one product that makes life better, but so many different innovations which connect with small aspects of one’s life and enhance it.
Which part of this healthcare journey are you both associated with, and how has the journey with Philips been so far?
Varun – Yeah, so I’m working as a lead IT Business Partner for Philips, India. And in my role I have to work with sales, finance, supply chain, and marketing functions to solve their problems using technology. One of my key focus area is to provide digital solution to my sales team to serve our customer better.
Vikram – I’m part of Philips personal health team and being with Philips for the last 14 years now. The product portfolio in personal health consists of the range of trimmers, hair dryers, hair straighteners, electric toothbrush, and mother and childcare, which is Philips Avent.
Akshay – To improve 2.5 billion lives by 2030, Phillip surely must have built a solid infrastructure to reach these consumers. Varun, What role has route-to-market digitization played in creating that base?
Varun – See, at Philips, our purpose is to improve people’s health and well-being through meaningful innovations. We want people to live a healthier and happier life today and tomorrow. The route to market digitalization help us to improve the reach of our product to our customer all across the world. It also helps us gather the data and insights around what are our customer needs and what kind of solution they require.
Akshay – So, Vikram and Varun, in the recent years, we’ve all seen that RTM digitization has become the norm, but what was it like in the early 2000s? How were you able to find the right data to know exactly what to do to win your customers and grow in the Indian market?
Vikram – Well Akshay, I started my career in 2004, so I can relate to this question well. It was more of paper reporting or the Excel reporting in some cases. Then, there was this MIS guy who used to collate all the reports and give it to the boss, and then he used to take out the inferences and pass the message to us, right? In times now we are most towards the automation where we not only get the reports, we get them real-time, on the go. The data has really helped us in taking out the inferences or making our action plans real-time and execute them.
Varun – See as Vikram has alluded, the scale of digitalization was very low in early 2000. And as a result, any organization or brand used to face few challenges. First of all, they had a very poor visibility of sales and inventory. We call it downstream sales visibility. It was also very difficult to improve the customer reach. You are unable to rapidly onboard distributors and reach more retailers. Also, the cost of your distribution channel was high. There was low productivity and suboptimal retail execution.
Akshay – Vikram, I know that Philips is present in markets across the world. So are the route-to-market models in these markets more or less the same, or do they differ?
Vikram – Well, it defers from market to market. In a market like India where we are moms and pop stores heavy, general trade is very strong here, right? And then there are countries which are developed. We have large formed stores which are very, very dominant there, followed by the online. So yes, it defers from market to market.
Akshay – So Varun, since the RTM play is fundamentally different across different markets, do you think that automation plays an important part to win here?
Varun – Absolutely. To add to what Vikram has said, the route-to-market will differ in different markets, in different parts of the world. If you talk about developed economy, you will see more e-commerce and modern trade. Whereas developing economies like India, Thailand, Vietnam, you will see the scale of urbanization is still less. And the route-to-market will also differ based on the type of city you’re talking about, right? Within India, we talk about tier 1, tier 2, tier 3 cities. So tier 1 cities, you will see e-commerce and modern trade playing the significant role, right? Whereas in tier 2, tier 3 cities, primarily it’s traditional trade. So with an eCommerce platform, you would typically do an EDR integration, so that you have a real-time order intake and supply. Whereas, when you talk about modern trade, many markets, you will see that there will be a point of sale integration so that you have a visibility of sellout. Whereas, when you talk about traditional trade, then there is an application of Distributor Management system. So you deploy a Distributor Management System towards your channel partner or a stockist, and then you have a further extension to that through an SFA, through a Retailer app and so on, so that you have a clear visibility.
Akshay – Vikram, so I’ve heard this saying in sales that no matter how much you sell on the first of every month, you start at zero. In these 14 years at Philips, how have you defined sales success? I would especially like to understand this with respect to sales automation technology, which is now a priority for long-term growth.
Vikram – Well Akshay, thanks for reminding me that we are still at zero in November so far.
For me, sales success is when, when we bill all the relevant outlets with the right assortment. Not only bill, but we are also visible all the time when we engage actively with our customers and the retailers, when the productivity of the sales team go high or become better. So, that’s the sales success for me. It’s not just one thing, but it’s a process that we follow. And when we follow the processes, the numbers follow us, and sales automation helps us in driving the processes.
Akshay – Vikram, sales automation is giving you thorough visibility of your sales, but has that visibility helped you drive the adoption of sales automation amongst your sales team and the entire distribution network at large?
Vikram – Well definitely, yes. But let me tell you this, this was not easy. The adoption from the customer side especially and the sales team in the beginning was not easy. But then, when we showed the customers the data, the power of the data, the inferences that we take out from the data, how can it really help in building the secondary and the sellouts on ground, right? So we not only talk about these sell in with our customers, but we also talk about the healthy secondary and the sellouts with them.
So when we went to them and told them about the power of data and how can it really help us in growth. They could understand and that also helped us in really bringing them on our side when we were launching this automation some years back.
Akshay – So what is the day-to-day benefit of having real-time visibility on product sales and distribution? I’m sure you’re predicting primary and secondary sales more accurately, uh, but I’d love to get a deeper understanding of how you’re leveraging retail intelligence in sales.
Vikram – So as an organization, we work on daily management. It is about getting or tracking and reviewing the progress, and applying the peritos of understanding where the gaps are. We also understand from the help of the peritos where these gaps are and why these gaps are. Basis the analogy we create the action plan and implement in the market.
Akshay – My next question is for you Varun, what prompted you to start your journey with Bizom?
Varun – See, there were several factors we were evaluating.
One was the overall industry knowledge, how strong they are on data analytics, that was our primary need because we wanted real-time analytics and how fast we can deliver. How customization or how flexible the solution are.
But at the same time, when we evaluate any IT platform, we do a very detailed assessment. We also look at security, their overall consumer experience and there was also a requirement around having a mobile application and so on. So it was a thorough evaluation before we decided to go for Bizom.
Akshay – Varun, as a leader in the IT domain, how would you say retail intelligence impacts the Indian retail industry at large?
Varun – See, it has a transformative impact. In fact, today morning, I was looking at one of the articles in Mint, where they had published the insights from Bizom, and where they were talking about how the inflation has really impacted the consumer buying behaviour during Diwali, how the industry has performed as compared to last year. So, until and unless you have digitalization and intelligence, you cannot draw these inferences. And as a brand, you cannot perform in the market. So it’s very important.
Akshay – Vikram, here’s a fun question for you. As a Bizom user, which three dashboards are your favourite?
Vikram – Well, I would say all of them, but if you ask three, the first would be the secondary achievement on a day-to-day basis against the target that we have. Second is the distribution health, which means analyzing the data retailer depth, what CTNs billed, how many CTNs billed, what is the current coverage, right? The third is the team productivity, so team performance on the go.
Akshay – Another question for you Vikram, how do consumer durables companies sell differently from FMCG companies?
Vikram – I started my career with FMCG company. You also know the kind of retail universe that an FMCG company has, right? And with FMCD, the retail universe is obviously not that vast. Also, the consumer here in FMCD, while purchasing a durable item looks for the solution. Which means he’ll be spending more time in the shop assessing the products and evaluating it and then making a decision of buying it. Which means that the impact of a retailer, of what retailer says is high.
Our focus in FMCD is more on the relationship with the retailer, right? And that is long-lasting; how we really engage with them. So that when the Philips person is not there, the retailer becomes the promoter for your brand, and that’s the perception a consumer carries with him when he goes back and then he used the product, so it’s different.
One example that I would give, in FMCG generally the field-force covers 25 to 30 outlets generally or maybe more than that in a day. While with FMCD, it is only 10 to 12 per day, which means they are spending more time inside the shop and working on the relationship with the retailer, and then talking about the business. So that’s the process that is being followed here. So yes, there is a lot of difference between FMCD and FMCG way of working.
Akshay – The next one is for both of you. Since the time Philips has been using Bizom, what kind of efficiency and impact have you experienced?
Varun – See, as an IT business partner, it’s very important for us to have the right ROI from any solution we deploy, so adoption is a key thing. So initially, we leveraged your evangelization services to really drive the adoption. Also, as we move along, as we deploy the solution, there will be a lot of continuous improvements. So we were able to make a lot of changes to the solution as the things evolved. Also, along with your team, we had developed a very clear roadmap in terms of what are the new technology which we need to bring over the next few years.
Vikram – Well for me, it’s the productivity. What I can see is that the productivity has increased after Bizom coming in. That has helped us in growing in secondary.
The other thing that I see is the coverage which has grown, and not only the coverage has grown, our throughput per store has also grown. So, which means along with productivity, our coverage and our throughput per store is growing. And overall we are growing in secondary, and that is helping us.
Akshay – With Bizom’s outcome-driven retail intelligence solution, is there any particular tool, capability or functionality, that you would be keen on implementing to chase the company’s business goals for the next few years?
Varun – See, in general, in India, the eCommerce penetration is low as compared to developed economies and the government is currently bringing ONDC. So that’s one of the spaces I personally want to watch and see how it pans out.
Vikram – Akshay, for me, it is the Retailer app that I want to be working along with Varun, in the future. A retailer app can help us engage better with the retailer and understand what his needs are. Along with that, I would also love to have something on suggested orders from the customers. That would also help.
Akshay – So we are going to end this chat with a rapid-fire. Varun, we will start with you. Top three books you would recommend for future leaders.
Varun – Okay, the list is long, but let me pick three of my personal favorites.
One is my all-time favourite Stephen Covey’s Seven Habits of Highly Effective People. One of the recent books which I read, which had a great influence on me is Robin Sharma’s The 5 AM Club. And then the all-time classic from Dale Carnegie, How to Win Friends and Influence People.
Akshay – One of the best examples of information technology that you use in your daily life.
Varun – So I use smartwatch to collect a lot of data around how much I walk, how much I jog on a weekly basis, and that is something which I analyze to take care of my health.
Akshay – One tip on work-life balance?
Varun – Start early in the day and avoid multi-tasking. Devote a dedicated chunk of time to get something done.
Akshay – Vikram, you’re up next. What’s the one thing people should do daily to become a leader in sales?
Vikram – Well, it’s not an overnight thing for sure. But yes, following the processes, and being patient. Be true to yourself in what you do. The bigger thing is that you always keep learning and always taking decisions which are data-based. So these are the five critical things for me.
Akshay – How do you tackle a bad sales day?
Vikram – Uh, well I don’t take the bad days very seriously. What I try to do is I try to learn what or where we really did not do well, right? Make the action plans accordingly, and implement them.
Akshay – Complete the sentence. Data is a superpower when ___________.
Vikram – It is quick and easy to access, and you can take timely decisions basis that.
Akshay – That was fun. All right, that’s a wrap folks. Thank you so much for joining us for this exciting conversation on Data and India: The Superpower Philips Needs. As a Philips consumer, I really had a great time understanding more about the business. Thank you so much, Vikram and Varun.
Vikram – Thanks, Akshay. It was fun indeed.
Vikram – Thanks, Akshay. That was a great interaction.
Akshay – Thanks for listening in, guys. Stay tuned for the next story.