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Suresh Narayanan, Nestle India chairman, Marketing & Advertising News, ET BrandEquity

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Suresh Narayanan, Nestle India chairman, Marketing & Advertising News, ET BrandEquity

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Narayanan shares his views on the makings of enduring brands and, as we get closer to the year-end, the key lessons to take away from 2020.
Narayanan shares his views on the makings of enduring brands and, as we get closer to the year-end, the key lessons to take away from 2020.

In June, Nestle India extended the tenure of its chairman and managing director, Suresh Narayanan, by another five years. The Swiss food giant roped in Narayanan, the first Indian managing director in seventeen years to head Nestle India, at a difficult time for the company. Narayanan successfully steered the organisation through one of its biggest crises which began in 2015, when a ban was imposed on flagship brand Maggi. He calls those years “horrifying times”. Five years and two minutes later, Narayanan’s navigating the country’s largest pure-play packaged foods maker through a new crisis brought on by a once-in-a-century pandemic.

Despite the fractures in supply chains and disruptions in business due to the lockdowns, by the September quarter, Nestle returned to double-digit growth. Sales from ecommerce channels set a new record. Powered by newly-minted pastry chefs and rising in-home consumption, brands like Milkmaid and Kit Kat did well in locked-down India and after Unlock 1.0. Consumption and popularity of pantry-staple Maggi hit stratospheric heights as people turned to familiar, easy and mood-boosting foods. In fact, consumer love for the instant noodle brand has never been stronger.

Brands which can withstand the test of time and economic tides aren’t built in a day, though. In an interview with Brand Equity, Narayanan shares his views on the makings of enduring brands and, as we get closer to the year-end, the key lessons to take away from 2020.

Edited excerpts.

In your view, what does it take to build enduring businesses and brands? What’s the recipe for success and longevity?I call it the 5R Principle. Relevance – Your relevance stems from your core set of purpose and values. From the time this company was founded in 1866, it has been about providing healthy and nutritious food options to generations of people. In India, we’ve been here for 108 years, we have been focused on brands which are meaningful. Brands like Nescafe, Milkmaid, Kit Kat and Maggi, have always had some relevance to the context of the consumer journey.

Resonance – How do you cultivate that relationship with consumers over a period of time? Milkmaid, for instance, is a 154-year-old brand and it continues to be young and vibrant, even during the current pandemic. It’s appealing to a lot of young people who want to take up the art of dessert making. Maggi is another classic example. In Q3, the brand grew by over 90%. More importantly, it added almost 9.3 million households. Resonance is extremely important at all points in time.

Also Read: Maggi launches interactive campaign for its new noodles range

Reinforcement – What are we doing as a company to innovate constantly and to understand the journey, the pulse, the mood and the tone of the consumer? That’s what the great marketing companies are about. It’s the capability of understanding the consumer journey and of connecting the dots.

Rejuvenation – Are we capable of putting up new categories and new propositions, as time goes on?

And finally, Rechartering our growth – What we were a hundred years ago, what we were fifty years ago, is now getting redefined. We are India’s largest listed food and beverages company. If we have to be that way, we have to continue to recharter our journey with people, purpose, partnerships and profits.

What’s the role of the marketing function today in driving growth for the company and building its brands?

Marketing for me is far more than the conventional definition of the function, looking at the 4 Ps and demonstrating the growth and profitability of a company. It starts with the consumer journey, from before she or he has made the choice of your brand. It starts with knowing and understanding the consumer completely. Marketing is a deep dive into all aspects of the value chain and is much bigger than the way we define it. And I dare say, in many contexts, too important to be left only to marketing managers. The CEO has to be involved.

I cannot be dissociated from the brand experience. Every consumer complaint that comes our way, if it reaches my desk, I personally reply within minutes. Everything else stops. The consumer complaint becomes a priority. Somebody has paid Rs 12, 20 or 50 to buy a brand of mine, they cannot be left with a suboptimal experience.

How have the events of this year affected how you think of the future of the organisation and brands?

We need to understand that this pandemic has been something that no one has fully comprehended, yet. It’s important to have a sense of humility and a certain degree of awe of the unknown. That is alien to a lot of corporate leaders. The pandemic has made us all a bunch of humble people. We are uncertain. We are nervous. We are in a context that is volatile. We have to have the humility to accept that there is something that is beyond us, that we will need help and support from each one of our people.

I strongly believe that in a crisis you don’t run a company, you help and serve a family. Ultimately, the corporations that are successful are those which look at not just their own people, but also their partners, all stakeholders. The smallest of suppliers should be protected by a company. It’s culture that takes the company from talking the talk to walking the walk. This is an important journey that corporations have taken.

Also, we have had to recalibrate the way we engage with our people. This is a welcome theme for me because the whole purpose of organisations is to recalibrate, to empower, to enable decision-making at the appropriate levels. All of us are working from home. A lot of my colleagues – more than 7000 of them in factories, in branches and in the marketplace – are taking their own decisions under certain guidelines from the leadership. This is the way organisations grow up and mature into new models of leadership relevant in the new context.

What has been a defining moment of 2020 for you?

A defining moment for me has always been witnessing ordinary people do extraordinary acts, seeing our partners going out of their way to serve people in times of crisis. This demonstration of spirit and determination is culture speaking. It is the summation of these extraordinary acts that make a great company. If leaders spend more time investing in culture, we would have far better and far more well-run companies in our country.

How do you think 2021 will play out? What’s your business outlook?

I’m very much a proponent of the consumption story of India. If we are able to stabilise our economy going forward, I believe it will start getting back the growth in some form or the other. The question in my mind is will it be patchy or sustained and smooth. At the moment it is very difficult to say. The next couple of months will define whether it will be an erratic journey or smooth one, but the consumption story will continue to be strong.

Look at food processing. The packaged food market in India is about $35 billion. It is expected to be about $70 billion by 2025. I don’t think that is farfetched because increasing penetration, increasing proclivity of consumers towards more credible, more transparent and trustworthy, and scientifically better modulated brands is going to be the call of the consumer. And we are witnessing this not only in India but also in Bharat.



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