The Future of FMCG: Mukul Deoras Bharat Puri

Thank you very much. So hello everyone. What I'm going to tell you has got nothing to do with any management consultant or any research agency or foresight agency and so on. I'm sure you've had a lot of conversations through the day on what's going to happen. I'm going to share a few thoughts and a few examples and a few beliefs that I have, and then we can chat about the strange things that are happening around us and how we can get out of it and do something more and bigger. So let me start with talking about VUCA. I mean all of you know VUCA, the volatile, uncertain, complex, and ambiguous world. And if you talk about VUCA, this is really living in a hyper, hyper world and everything seems to be changing so dramatically. And from where I sit and I see countries like India and I see countries like China and I see countries like Australia, you see the complexity that's changing around us. There is so much of uncertainty.

But the story on India is very different from the story elsewhere, and that's what I wanted to focus a little bit on. I thought there are probably two things that we need to keep in mind. One, there is an underlying trend in India, and then there is a superimposition of certain turbulence that has recently happened, and we have to segregate these two because otherwise we can mix these signals and kind of jump to conclusions which may not be absolutely correct. So to start with the underlying trend, I still believe, strongly believe, that the fundamentals in India are very, very strong, perhaps the strongest I see anywhere in the region. I see so many countries, and I see even China, I see the Chinese trends and the ups and downs in China, so I actually see the fundamentals are very strong. And there are various reasons. What I'm going to tell you is not new to you at all, whether it's talking about growing income, growing consumption, multiple income families especially down the economic strata where the multiple income families has actually increased the per capita income and more importantly the disposable income that is available, nuclearization of the family is also leading to personal consumption instead of family consumption, and also a very simple fact that we have gone beyond just measuring literacy, we're now measuring education. And when you measure education, particularly of women, that education is not equal to knowledge, but education is actually leading to confidence, and that confidence leads to consumption. And this economic confidence leads to economic independence for women as well, and that drives more self-consumption. So you see, some FMCG categories which are women-oriented categories have seen explosive growths.

But you superimpose on top of that the turbulence that we are seeing right now because of what we're going through as a world in this pandemic. And I like to see this as a two-by-two matrix. You see that there is a kind of impact that you have, which is whether it's an immediate impact or a delayed impact, and then you see whether the impact is short-term or long-term. And you see this two-by-two matrix. If you start with immediate and short-term, it's about fear, it's about holding back consumption. That's what happened in the beginning of last year. But if you take the same immediate impact but over a longer period of time, we see a lot of health categories increasing. So again, an implication for FMCG is health is becoming more and more important for us as we go along. The other thing is about delayed impact, delayed but which lasts only for a short period of time. One example of that is perhaps the pent-up demand that we are seeing right now, consumption which is coming back, which in some senses is sometimes pantry filling, and in some senses it is like 'I missed out something, so let me consume something.' So there is an almost like a revenge consumption that's happening right now, which is again a short-term impact that's not going to last for too long. But the delayed long-term impact is about when we'll talk a little bit more about it: there is a two-speed economy that's emerging. There is one economy which is growing very rapidly and becoming richer, and there is one economy which is kind of struggling a little bit. And therefore this two-speed economy, the impact of that is going to last a little bit longer.

Over and above all of this, there is a gear shift. And this is not short-term, this is not long-term, this is a fundamental shift in the way people consume and behave. And it's tough to say it is a digital revolution. It is actually the revolution. It's not revolution, it is about accelerated evolution because every day changes and every day it keeps getting different and different all the time. So this rapid digital evolution leading to a consumption pattern which is more on-demand consumption, which is 'I get what I want, when I want, where I want, and I want it now.' This kind of consumption behavior is leading to a change in the buying pattern significantly. We talk about e-commerce becoming big and so on, but that is just the beginning of the change. Driving personalized consumption is going to be very, very big, and I see that in China as well where the personalized consumption is exploding. There are a lot of implications on the brand, and I'll talk about that in a minute or two.

But what are the other implications? I think the first implication is there is a significantly different kind of value definition that's emerging in the market. So if you talk about people who are resource constrained as against people who are not resource constrained, as I said there is a two-speed economy that is emerging, and therefore you probably get a bimodal distribution of income in the market. And because there is a bimodal distribution, we as marketers have to address these two worlds in a very distinct way. Each of our brands has to evolve and address these worlds in a very distinct way without destroying the fabric of the brand. So you wouldn't be surprised if you have a 10 rupee pack of a brand and a thousand rupee pack of the same brand. And in years gone by we would have been surprised how can a brand play like that, but that's really the format in which things are happening and they do coexist simultaneously. What that means is that it has very significant impact on innovations. So the value ladder of innovation is becoming extremely important. Again, innovations have to be across price points, innovations have to be across formats, delivery systems become very important because delivery systems help you to deliver the price points that you are looking for. And people are expecting same experience. I'll give you an example, let's take a shampoo sachet. That's an old example. People don't expect a different experience from a bottle and a sachet. Similarly, if a high-end skincare cream or a lipstick, whether you buy a small pack or a large pack, they don't expect different experiences, they expect the same experiences. So the value ladder becomes extremely important. But what's also behind all of this is people innovation these days is not just about product innovation, it is also about experience, and it is that which is extremely important. And experience is a combination of everything, the way you deliver. In the past, our innovations in the FMCG industry particularly used to be guilty of that, was either fragmenting a line extension so you have a variant of a variant of a variant of a variant, or you have a fragmentation of claims, 'oh I had 10 more and 20 this and 50 that' and so on. And that's how innovations used to be delivered at one point in time. But I think innovations have gone beyond that right now. People are seeking experience as an innovation. The product, the format, the delivery, the entire usage, the retail environment where it is sold, the way in which it is bought, the way it comes in, we talk about unboxing experience, that has become an integral part of innovation right now. Just go to the Nykaa website and just see what kind of experiences you get on the products, and it is so different from what you would otherwise get in a kirana store that used to be or a general market store that used to sell FMCG products in the past.

So the platform in which you interact with the product and buy the product have also become an experience driver. The other big thing that is happening is innovations are not just about products, but they become kind of an augmented product. People are expecting a little bit of digital interface with the products, and it's not any more surprising for them. And they're seeing augmentation coming through. I'll give you a couple of examples. A simple example which is not FMCG is about how a watch has become a health monitor also for all of us. Or even in the FMCG industry, how skin diagnostics and skin care are going hand in hand with each other. Something which is close to my business, an electric toothbrush and a diagnostics or measurement of how you perform inside the mouth is now become a common place in some markets. Paints that repel insects and so on. Augmented product is something that has become a reality at this point in time. I also think that people are now more demanding. The consumers are demanding not just the 'what' of an innovation, but the 'why' of an innovation as well. Part of this is also leading to that ingredient explosion that we see in the market. I mean, everything is ingredient, ingredient, ingredient. 'Oh this is multani mitti from here and this is saffron from there and if there's salt from there' and so on. All kinds of explosions are happening and ingredients are being used right now. Partly it is driven by the big wave of Ayurveda that we see in the market, but that's not something that's going to disappear. That, I believe, is here to stay.

I think one of the most critical changes in innovation is about how innovations are curated. I mean, gone are the days when you create a mega innovation and you launch it into the market and then hope and pray that it will succeed. Gone are the days when you put one, get into 500,000 stores or 200,000 stores distribution within one month and then blast advertising at 2,000 or 5,000 GRPs and get reach and frequencies and then say 'oh it's gonna work.' Those things don't work anymore. It's about curation of innovations. It's about designing an innovation, probably incubating it using perhaps a direct-to-consumer model to incubate the innovation, pivot as is required, and then scale up. This in some senses is going back to the old test market kind of thinking, except that those test markets used to be long drawn and had very little feedback mechanism and used to take a lot of time to see go/no-go, and the ability to pivot was much less. But now digitization and e-commerce, particularly D2C, has made a big change.

The other big implication of what's going on is also the media. Our media and how consumers engage with media are changing dramatically. There's more personalized, more on-demand, more digital, more specific targeted to the person who you want to speak to. It's no more the target audience of 'all adults 15 to 45.' Those kind of target audiences are very difficult to not just implement, but also there's a lot of waste in that target audience which we are not realizing because we can sharply focus our media much better. There is also more two-way communication between the receivers and the transmitter of the media. And then there is more to media than what we see. For example, the role of influencers. What used to be done by celebrities, now there are millions of micro-influencers who are making a difference, and that happens because there's a two-way communication connection linked between a consumer and an influencer which never existed in the past. And our ability to create brands purely on the basis of influencers is something that is not just new, but it is here to stay. If you see what's happening in the rest of the world, whether it is in the Western world or if you go into Far East, you see Korea, you see Japan, you see China, influencers live streaming is big, big business. And it's just our end, it's time that it will come. And at the back of all of this is data, data, data. Data helps us to create the backbone and the spine with which we can connect with the consumers and sharply target it. So one of the big things about FMCG marketers of the future is going to be how good you are and how comfortable you are with data. Another big change is the omni way of marketing. Omni as a world is becoming seamless. Whether you're online or offline, consumers are seamless between online and offline. Brands and marketers have to also become seamless between online and offline. That's not easy. Our organizations are silos between online and offline, and it is very difficult to cut across those silos and create the bridges so that there is consistency between online and offline. But that is going to become extremely important as we determine the future of this world.

Some evergreen messages like rural will continue the growth. I think also because incomes are growing, consumption is growing, but also data consumption is growing in rural. I was told that the data consumption in rural markets is now the growth in data consumption in rural markets far outstrips the growth in data consumption outside rural markets. I think it's just a matter of time when logistics hurdles will be overcome, and then these rural markets will leapfrog. We haven't seen e-commerce explosion yet. It is all held back by logistics challenges. Once those challenges are unbundled, you'll see e-commerce in rural areas explode like we have never seen before. I think one of the big changes that's also happening as a result of that and that's directly important for brands and consumer products is fragmentation. There's so much more fragmentation of brands that is happening because the overall barriers to entry are coming down. That does not mean the secret sauce for success is easy, but the ability of people to try is becoming cheaper and cheaper, and therefore people are going to become more eager to try out. And you see the plethora of brands that we see around us all the time, whether they are local brands, regional brands, or national brands, or even on various channels, and their channel-specific brands that have come up, and they have been able to create a small-scale experiment with which they can decide whether this brand is going to be successful before they scale up. So the focus on brands in a situation like that will become extremely important. It does not mean there is an end for large brands. In fact, there is even more role for larger brands. But the role for the larger brands is to be aware of the guerrilla attacks that they face from smaller brands, but at the same time not move away from what you really stand for. And it is brands, brands, brands. Brand thinking is going to be far more important than before.

And the last point I would really like to leave behind is what's going to define the winning code for marketers of the future is going to be agility. How quickly and how easily you can move on and pivot and do things differently is going to be a big call out for the future. Somebody said the other day, 'Change is always with us, and in fact what you see as disruption of today is actually the baseline of tomorrow.' So you got to get started all over again as the disruptions keep happening again and again and again. So agility and agile brands are going to be the winners of the future. So these are a few of the principles and learnings that I've had over the last few months, seeing and watching things happen around us, which may lead to a few more questions and thoughts as they go along.

I think there is some pivoting and there is some reinforcing, and I think you need to do both of these. I think the first step that we had to do was to single-mindedly focus on execution, execution, and execution because the execution was challenged. And it's not about distribution alone. I mean, we all know distribution execution is challenging, but to be agile enough to see what do you focus on, communicating to people what is important to people at that point in time, quickly changing your media plans and quickly changing your focus behind brands in order to make sure that you are doing what you're doing. We are notorious in our planning processes as FMCG industry. We do an annual plan, sometimes we do a five-year plan, then we do a three-year plan, then we do an annual plan, and then we do a quarterly media plans and so on. So we are not used to planning on a much more frequent basis. So the agility in planning was the first pivot that we had to bring about. The second pivot that we had to drive was actually increase our level of innovation and manage innovation in a very different way. Gone are the days when we could actually spend two years on creating an innovation, gone are the days when you could do extended consumer tests and then decide what innovation is going to work because it was just not feasible. But you had to innovate and you had to innovate in a very smart manner. So how do you create a kind of a panel or a kind of a collection of highly involved consumers who can quickly respond to the innovations that you want to create and use that to define and then experiment and then A/B testing, which used to be something that you just read about somewhere and some management consultant would come and talk to you about, which virtually became a part of life. So you had to do something quickly, read and come back. So that's another big pivot that you had to do. What that also meant was tracking of our business. Now again, we are not good at tracking our business. We wait for the Nielsen report to come, which comes six weeks later, and then say 'Oh my shares have gone down, oh my shares have gone up,' so there is a smile or there is a disappointment, and there is a six to twelve week lag between understanding what's going on and deciding what to do. Digital commerce actually helps you shortcut that. So your ability to throw something into the market, read what's going on, target it carefully, and then refine all these new skills we had to change and we had to learn all the time. So a lot of pivoting had to be done.

I think the biggest reason why processes are so slow and difficult in large organizations is because there is a fear of failure, if I may be blunt about it. Yes. And this fear of failure makes sure that you want to make sure that your resources are focused on something that you have reasonably good guarantee of success. I think that had to change because in a situation where things were uncertain, the fear of failure had to be replaced by fear of not succeeding. And the only way you can overcome fear of not succeeding is by doing something. If you stay frozen, you will fail. And the only way you can succeed is by doing something. So the leadership lesson there was to replace that with fear of not succeeding. That's one. The second thing is you had to mentally make, and it's easy to put that down because you're pushed into a corner. The cost of failure has gone down actually. It has gone down. So you could actually experiment, as I was telling you earlier, and you could take a bite-sized risk and therefore reduce the cost of failure. And because you could reduce the cost of failure, you could make the organization think about what if the cost of missing an opportunity. If the cost of missing an opportunity is much higher, then let's forget about the cost of failure and go for it. But all this is theory. I think the biggest thing that we have to do as leaders in the organization, and we had to, and the Indian team, and all my businesses did quite well, was actually to keep systematically asking people to identify things which are safe to drive. We're not banking, we're not risking the bank on this one, we're not betting the bank, we're not risking the future of the company on these things. What's the worst case? Okay, let's articulate what is the worst case and be prepared to write that off. Okay, I'm prepared to write off something, and now you are free to go and play around. If it sucks, if it doesn't work, you have met your objective. If it works, you have exceeded your objective. So that is the philosophy that you go ahead with on a safe-to-try basis. And the last thing is, you know, one of the things that because we were all remote and we still are in many places, we had to take off processes from the plate. We had to just remove those processes. We just didn't have the luxury of us having two-day-long meetings. It just didn't work. So we had no option but to take quick decisions and move on. So these are the things that helped move along a little bit.

You know what, the people in the companies have become very used to this, so any return back to the old ways is going to have a lot of resistance, and thank God for that. Thank God for that because the first thing would be to go back to the legacy situation, and then we will be all the things. This entire crisis would have been wasted as they say.

And all most companies, most global companies are thinking about how they can adapt their supply chain to the changes that we are seeing right now, because whether it has got to do with the pandemic or whether it has to do even with the logistics challenges that we are facing right now, and you see that happening much more frequently outside India than you see inside India actually. The sheer challenges of shipping and logistics and the ability to service a market is becoming very, very difficult right now. So there you will see, as you rightly said, resilient supply chains are coming up. But more importantly, I think scale was the driver of supply chain at one point in time. I think speed and flexibility will be the driver of supply chain of the future. There is absolutely no question about that. And I think the scale is an overplayed attribute honestly. We have seen that the scale advantage is a few percentage points, yes. When it is a commodity market, scale advantage helps. When we are talking about branded markets, scale advantages are those which are not necessarily the ones that you will desperately hold on to and give up agility and flexibility for that. But the implication for the marketing team and brand teams as a result of that is their connection with supply chain has to become much stronger than what it has been in the past. Because as you become more flexible and as you become more agile, it takes two to tango. It is not the supply chain alone that can dance on this one. There needs a partner, and that partner is the brand team, and they have to dance along with them to make sure that they do it in tandem in a sense. So that's going to become a big demand requirement of the teams of the future.

Shipping will be disrupted the way it is. Commodity and raw material, feedstock, packaging is going to be at the prices. All supply chain guys would have been laughed out of the room and said, 'Have you seen the last 10 years data?' And here we are sitting now trying to just manage costs. Forget demand, you can't get ships into ports. The blank ceiling is killing everyone right now across the world. It is very fascinating. There are a few reports which you may want to take a look at. The demand spike is probably four or five percent, it's not that there is a hundred percent increase in demand. But the resultant impact on the disruption on supply chain and logistics is like as if demand is multiplied by 2x or 3x. And that's because the supply chain was designed very rigid. There are lanes. We talk about lanes and shipping. I'm sure you're aware of that. There are lanes and lanes have to be managed. Only things happen only through lanes. And if you're not in the lane, nothing will happen. Now these are the kind of things that just went out for a toss as the world changed. So flexibility is the name of the game.

Wonderful. And now you overlay digital. Digital, of course. In the good old days, I used to say innovation and rural marketing are the two most misused words in FMCG. Soon digitization is going to become the third because it's the panacea for everything. But having said that, talk about how FMCG organizations turn digital into a competitive advantage rather than just desperately trying to keep pace. So again, the entire herd is flocking towards digitization. And we started with one single measure of digitization: what percentage of your media budget is digital? Give me a break. That's the worst indicator that you can have. Don't talk about percentage of digitization. It's got nothing to do with what fraction of your budget you spend on digitization. The challenge of digitization is you can end up spending all kinds of money all over the place without even knowing whether you're doing it right or not. And before you realize, you can get caught with that: 'Oh my god, I'm not being digital, so let me just spend as much as I can on digital media.' And then we compromise our reach and frequency of our basic business as a result of that.

The judicious combination of the two is important. In digital, you must understand what is the role of digital. The role of digital is actually in three folds. First, the role of digital is to help us target correctly and to identify whether that targeting is working or not. Once you identify that the targeting is working, you can then do look-alikes through non-digital media and then explode that reach through non-digital media with more assurance that it will have a positive impact. The good thing about digital is that you can actually read the full funnel right down from the top of the funnel to the conversion. You can see everything, you can see what works and what does not work, create hypothesis, and then explore that beyond the digital format. So I think that's the first and the most important thing about digital. And I think that's where marketers should start from.

The second thing about digital is it allows you to target some of the brands in a more efficient manner because otherwise you would have spread yourself thinly across various target segments. So you could, for example, we've just launched a toothpaste which is meant for diabetics. There's no point in doing national television advertising for 1.3 billion people when your total target audience is 50 or 60 million people, and the topmost target audience is probably 10 million people. So if you can target much better, you can narrow your focus and be far more efficient and get much better return on your investment. That's another one. And I think the third one that is going to explode as we go along is the entire linkage between digital engagement and e-commerce transaction. E-commerce transaction will keep improving, and as it keeps improving, there is a digital funnel that needs to lead to that e-commerce transaction. People will have to become very comfortable with that. So one of the things that marketing people will have to become more comfortable with is being accountable for sales. That's counterintuitive for marketing people. You have a sales target, you need to deliver a sales target by the week, by the month, by the quarter. That sales target is on how much of your traffic you're able to drive towards conversion and deliver an e-commerce sale. It's something that is going to be extremely important. If you compartmentalize these as the roles of digital, then there is a meaningful role that will happen. It will never say that this is the only thing that we need to do.

Yeah, I remember that I was in west UP as well as a salesman.

Yeah, I mean D2C is a phenomenon which is great and scary at the same time. Why do I say that? It is great because it targets people very carefully and correctly, and it narrows itself so that you are absolutely clearly delivering what is required to a particular consumer. It's scary because honestly to create scale out of D2C and make it viable is a very, very difficult task, and many, many people have suffered. Now, it is not a surprise that most of the D2C businesses are also startup businesses, and a lot of the D2C businesses are also in the process of getting more funding. This is a little bit, maybe too harsh a statement to be made, but valuation drives D2C for a large number of D2C businesses, whereas long-term sustainability is value creation, not valuation.

And that's why big businesses and big companies are not so good at creating D2C brands. It is very difficult to justify a D2C brand and say that I'm going to lose money forever, because you're not going to sell that business to somebody else. If you're not going to sell that business to somebody else, then it has to become profitable at some stage. So the D2C as a business has to be very carefully managed. And if I may be forthright on this one, there will be a shakeout on this one, and the real meaningful D2C businesses will survive. What are the two criteria that are required for D2C businesses to survive? One, there is a meaningful need that is being addressed which is not being serviced by somebody, or there's a real opportunity or gap that you exist in the market. And the second important thing is there is a transaction value which is large.

That is absolutely critical for a D2C business because if the transaction value is not large, when the cost of servicing a D2C model is very high, the viability is suspect. So if I were a D2C business, my advice to them would be: just make sure that you have a real good reason why people should buy you, and that will drive both traffic and the top end of the funnel into you, but more importantly it will create a viable transaction so that you can service that business. And if possible, and not always possible, you should think about a long-term value of that business. It is not always possible. If you justify businesses only on the basis of long-term value, I think you are heading into a failure. I think you need to justify the business: the cost of the margin on the transaction must exceed the cost of acquisition to start with. Or at least there should be a window of hope that you're going to do that. If you believe that only after I get the 10th repurchase that I'm going to make money out of this person because my cost of acquisition or retargeting is going down, and that's why people will buy, guess what? Fundamentally, consumer behavior is not going to change just because you're D2C. Remember, there is a book called 'How Brands Grow' by Byron Sharp. He talks about the fact that the entire bucket of consumers is a leaky bucket. You'll always keep losing people. So to build a business purely on the hope of repeat purchase is actually very, very difficult. You need to build a business based on penetration and trial. And I think world over, the data shows that long-term market years, it makes far more sense to concentrate on penetration than to concentrate on a set of buyers who will keep buying your product. I think the data is...

I think my view is Bharat will catch up pretty quickly, but in a very different way. Bharat and India's consumption baskets will look very different, but the consumption increase and the consumption growth will be very, very rapid. Between Bharat and India, Bharat will become just as big and as equally important as India. We all get enamored with India, but there is a bigger Bharat sitting behind. And I think if I were a smarter marketer, I would be focusing on the Bharat of this world because that will change faster. Some smart person will see that change and will be able to do things very differently. The solutions of Bharat are very different. If you ask me, the future is Bharat.

It's got nothing to do with MNC or non-MNC. When you buy, you don't buy just because it's an MNC product. You buy a product just because you believe that product gives you something, delivers you something, and you trust somewhere. As long as you have a differentiated product, look at Pepsodent, look at what you see behind Bharat screen. Now you think that's an MNC product? It's one of the best brands in India, most trusted, most reliable, most valued, most loved brand. It's got nothing to do with where it comes from. It comes from the belief that brands need to address what the business needs and what the consumers need. As long as you can deliver that, you have a differentiator. Again, go back to the book, Byron Sharp's book on 'How Brands Grow'. It's a terrific, terrific book. If you have not read it, just go and read it. I'm not being paid to publicize that book, sorry. But it's one of the most inspiring books I have read. They keep talking about the fact that you need physical availability and mental availability, and you need distinctive assets which can help you build both physical and mental availability. If you have these three things which are very sharply focused on a consumer need, you have a brand. That's important.

No, it's about talent required to redefine the brand, but it is about brand. Absolutely about brand. My simple advice, I don't know which namkeen this is, listen. When Sachin Tendulkar goes abroad, he doesn't become Joe Root or somebody else. He remains Sachin, but he adapts to those pitches. Frankly, it is about your brand adapting to the new pitches, not trying to be who it is in India.

Again, that's got nothing to do with FMCG. It's got to do with the business strategy that you want to have as a company. Whether it is something as a competitive advantage that you need to retain, build and retain, or is it something that is best outsourced? It all depends on what your business model is. If you see empirical examples around the world, people have outsourced because this is not the core competence of the businesses that are focused on building brands. When you focus on building brands, unless the delivery is a part of the brand, the delivery experience is a part of the brand, in which case you need to enhance it. Like Domino's Pizza, the delivery experience in itself is a part of the brand. If the delivery experience goes bad, then your impression of the brand goes bad. So unless it is integral to your business, let's say if you are into a durable where servicing is important or installation is important, I would be very surprised if brands would get caught up with logistics themselves.

I'm sure Pepsodent has a lot of examples. You know what, the beauty of consumption is that most of our businesses and brands, our consumption is private. Even though COVID has got social distancing, we still brush our teeth all alone. It doesn't matter how distant you are. We still apply our shampoos and consume our health drinks. Food is sometimes social, but everything else is pretty private. Now, the question about AI and VR, these two are very different things. Artificial intelligence is all about how do you make sense out of a set of seemingly disconnected data points and disconnected pieces of information. Is there a replicable behavior that can be predicted? Whether it is artificial intelligence for sales forecasting or consumer behavior forecasting, that's here to stay because it allows you to create an ability to go beyond the human brain and be able to create a solution which is very difficult for us to imagine, and more importantly, continuously keep improving that solution.

The virtual reality part is going to be extremely important, and a combination of AI and virtual reality. I'll give you an example. We have a toothbrush which is an electronic toothbrush, which is connected digitally to your phone, and you can even connect it to the cloud data and get whatever you want. You can see how well you are brushing, which part you brushed, which part you have not brushed, why you're not brushing, where you are missing certain spots. And we now have one which has got even a camera installed, so you can see whether there is plaque buildup happening somewhere. All of this is artificial intelligence because it is picking up signals, converting the signals into data, and then data is creating some meaningful assessment out of that. And then there is a virtual reality that you can create out of that, in case what kind of movements are necessary in order to create that kind of product experience. All this is now just a matter of time when it will become an integral part of some of our products. We all wear Fitbits and all kinds of devices around us all the time anyway. The Fitbit is also an artificial intelligence system which is telling us what to do and what not. But maybe...

I think yes, but it's not easy. It's not possible for a single brand to create the digital inclusivity that is required, but a collection of brands together and the collection of how you delight a consumer through your digital inclusivity will actually make the movement. Even non-tech savvy people will also become inclusive. When there is a need, there is a way. People are able to find the way to use a phone. For people who are never new, you tell them that this is the most complex computer that they have ever seen in their lives, but it just happens to look like a mobile phone. They won't even believe you, but they're easily able to navigate that. So I think it all depends on user experience. The more you make your user experience exciting, delightful, easy, the more inclusivity will happen on its own. It is not something that can be legislated or say that you need to spend X percentage of your money on digital inclusivity. No, you need to make sure that your user experience is very delightful, and once it is, it will just happen on its own.

I think everyone is feeling the pain. It's not just the mid management which is feeling the pain. The C-suite is also feeling the pain because they see the sluggishness and the slowness of the organization. The smart C-suite is actually seeing that they themselves are probably because of this slowness of the organization. So it starts with a bit of introspection amongst the C-suite people. Those who are on C-suite listening to this conversation would probably identify themselves with this one. Sometimes we are the slowest link, the slowest part of the entire chain that is moving ahead. This entire thing about letting go, empowerment, these are big words, very, very difficult to execute.

And I think one of the biggest challenges as leaders you have is when you empower people, you have to trust. That's the core of empowerment. When you have to trust people, you have to let go of your own power. Remember, somebody said the other day that the total power in the organization is constant. It just depends on how you distribute it. You keep it everything yourself, there is no empowerment. If you empower something, you have to disempower someone. So you have to let go. It is easier said than done. I really appreciate this question because time and time again we see that there is a part of the organization which is tugging and pulling the rest of the organization, and the rest of the organization is still, 'This is what made us successful in the past, and therefore this is what will continue to make us successful in the future.' We're still stuck in that a little bit. There is no easy one-two-three solution on this one, except to say that humility of accepting this at the top of the organization is the only way change can happen.

Yeah, I think the fact that brands have to create a world which is better, and the future that is better, is going to become even more important. We do not have the luxury, nor will it be very responsible, for businesses to completely disregard the impact that it is going to have on the social environment and the people around us. So it's not about being compelled to do it, but it has to proactively embrace it as a part of its persona, as a part of its ethos. It's like you talk about equal pay to people, you talk about rights for people to work, right for people to live in an environment. No brand, no product, no industry has the right to destroy the environment. That is something that we have to learn and be a part of all the time.

Now the question is, the more important question, equally important question, therefore what is the role of ROI? Is ROI important or we just need to sacrifice this ROI for the sake of this? This goes back to the basic theory of economics. Profit is important. Without profit, there is no economy, there is no sustenance of investments, there is no sustenance of enterprise, and therefore progress and innovation. Profit is integral to the way human life and human beings have created, lived, and progressed over the years. So ROI will continue to be important. Businesses will have to unfortunately find the right balance between ROI and the responsibility that they have to deliver to the society around them. It is not either or at all. But responsible ROI will become very important. Absolutely, in my view.

Yeah, so one-size-fits-all brand campaigns were a death knell in themselves even before COVID. If you think that there is one solution you can unleash upon people and once and for all everyone will buy into it, that's the monopolistic situation where you have one size fits all. 'You can have whatever color you want as long as it's black.' One size fits all was never successful, never will be successful. COVID has just made it a little more exaggerated, in your face maybe, but it's not just COVID. Even before COVID, you can see in the last 10 years the way brands have become far sharper in the way they are delivering. Those days are gone when there was no competition, when there was monopolistic behavior and there was one thing that could work and nothing else. That never was and that never will be.