Beacon_october3.pdf

BEACON October 2016

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Contents ABOUT US

OUR TEAM

INDUSTRY ANALYSIS

BRAND ANALYSIS

CASE ANALYSIS

CONCEPTOFTHEMONTH: CROWD FUNDING

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ABOUTUS TheSIMCON-SIMSREEconsultingclubisan initiativestartedin2012forthosestudentsin pursuitofexcellenceinmanagementconsulting andstrategicmanagement.Aimedatcreating awarenessamongthestudentsaboutconsultancy asadiscipline,theclubstrivestomaintainstrong relationswithtopconsultancyfirmsandprovide platformtocrafthighlyskilled&competent consultantsfromSIMSREE.Theclubisaresource forinformationaboutconsultingandaplacefor studentstoobtainreal-worldconsultingexperience.

MISSION Tocreateawarenessamongstthestudents aboutconsultingindustry&itslatesttrends. Tomaintainstrongrelationswithtop consultancy firms.

VISION

SIMCONprovidesanavenueofinteractionamong faculty,studentsandalumnithroughcompetitions, liveprojects,guestlectures,andconclaves.For thispurposetheclubhasalsobeenpublishingits monthlynewsletter–BEACON(BEACONSULTANT) andmaintainsaFACEBOOKPAGEwherelatest newsanddevelopmentintheconsultingindustry are posted.

Toprovideplatformtocrafthighlyskilled& competentconsultantsfromSIMSREE. To provide exposure to students via competitions,liveprojects,guestlectures& conclaves.

Contributions invited: Tomakethisfeatureasuccessfuleffort,weseekcontinuedinvolvementandcontributionfromourreaders,thatisYOU.We invitearticles,researchpapers,andtriviaonthemesrelatedtoconsulting.Beitindustrynews,consultingtrends,ajoke,a cartoonorfeedback,weareeagertohearfromyou.Sogoahead,doyourresearch,pendownyourthoughtsandmailyour entries to [email protected]. Best Regards, SIMCON - SIMSREE CONSULTING CLUB

OUR PRESENCE

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OURTEAM ARPIT agrawal HUZEFA BODABHAIWALA ASHAY DHURI KARAN CHOPRA NAMAN CHANDAK praCHI KORE SARANG KULKARNI YOGESH MOHATA

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BATA BRAND ANALYSIS

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Introduction

million customers every day.

Bata brand known for well-made and well-priced footwear, clothing and accessories, was founded in 1894 in Zlín,  Moravia by Tomáš Baťa, his brother Antonín and his sister Anna. Its headquarters is located in Lausanne, Switzerland.   Bata succeeded in becoming one of Europe’s leading shoe manufacturers in just a few decades, due to smart entrepreneurship and competitive pricing. In the early 1930s, the company was present in Switzerland, Germany, England, France, Yugoslavia, Poland, India and the Netherlands. By 1960, Bata employed about 42,000 employees owned thousands of companies and factories in almost every continent. It was one of the few manufacturers to sell its products all over the world. In 1970, Bata Industrials was founded to meet a specific demand for footwear for professionals. Since then, Bata Industrials has evolved to become a designer, producer, and marketer of safety footwear and socks, targeting the professional end user markets. At present, Bata Industrials is one of the world’s largest manufacturers of this type of footwear. It operates four business units worldwide- Bata Europe, Bata Emerging Markets, Bata Branded Business and Bata North America.

Bata Enters India 1931- The company, Bata Shoe Co Pvt Ltd was incorporated in Calcutta. It manufactured all types of footwear, footwear components, leather and products allied to footwear trade. 1942- A machinery department was set up to produce the first Indian-made major shoe machine. Also, a leather footwear factory was established in Patna, Bihar, known today as Bataganj. 1973- Bata Shoe Co Pvt Ltd became a public limited company and the name was changed to Bata India Ltd. 1988- A new brand of shoe, `Tigre' was introduced for sales through wholesalers and independent retailers. 1989- The company entered into an agreement with Adidas of West Germany for manufacturing and marketing of sports footwear, sports goods and sportswear in India. 1997- India’s largest shoe company made a remarkable turnaround for the year ended December 1996. Entered into a marketing tie-up with Nike. 2003- A retailing alliance with Lee Cooper Shoes and repositioned itself as a marketing firm. 2004- Appointed P M Sinha, former CEO of Pepsi-Cola International South Asia as the Chairman. 2013- Bata India won the award for 'Most Admired

Bata World-Wide Bata has recorded its presence in more 70 countries with over 5000 stores. The 28 production units are spread across 18 countries. Bata serves more than 1 BEACON October 2016

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changes were made which were socially acceptable like the depiction of more personal moments, such as a woman in her bedroom sleeping on a comfortable pair of Bata slippers. These ads appeared in ladies magazines at times. After the Second World War, advertising undergone major changes and Bata kept up with it. In 1948, Bata came up with a Swiss ad featuring a kitten popping out of the top of a boot. In 1960, Bata exploded the global market, adding many sales outlets and factories all over the world. In the 1960s the ad industry shifted its focus to more youthful markets. Bata incorporated photography into its ads

Large Format Multi Brand Footwear Retailer of the Year' by the Images Shoes & Accessories Forum – 2013. Brand Equity recognized Bata into the 'Top Most Trusted Brands' in November 2013.

Product Portfolio Bata’s vision is “To make great shoes accessible to everyone!” It offers footwear for all age groups. It has over 2500 styles of footwear & accessories. Bata’s portfolio includes Boots, Formal Shoes, Casual Shoes, Sandals, Bags, Belts and Wallets for men; Closed Shoes, Sandals, Head Over Heels, Clutches, Scarves, Handbags for women & school shoes for kids.

Competitors The footwear market in India is highly unorganized with many local brands still dominating the market. Paragon & Relaxo are the brands with lower product prices & targeting the masses. Brands like Nike, Adidas and Reebok are the most famous in the metro cities and urban India. In the formal shoe market,

to attract the younger generations. During 1970s, Bata was at the forefront of fashion both in terms of product styles and presentation of its ads of chunky, platform shoes and psychedelic colours. In 1980s, Bata’s focus was to promote lifestyle branded products and came up with a series of campaigns like the almost futuristic, high-tech look of Marie Claire and Power Athletics ads appealing to aerobics fans of the era.

Red Tape & Lee Cooper are leading brands. Puma is the fastest growing shoe brand in India.

Advertising

For a few years, Bata did not come up with any effective promotional campaigns. They did not advertise for a long time. Considering the rising competition and behaviour of customers it was necessary for Bata to get into advertising. Advertising was needed to create top of the mind awareness not only to attract new customers, but also to retain their old custom-

Vintage BATA Ads In 1929, Bata ads were simple and straight forward. It contained little more than two shoes with their price mentioned along with the name of the company. By 1935, not much was changed with the ads being simple and direct connecting with the consumers. Some BEACON October 2016

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ers. For example, a Bata customer might want to buy Relaxo slipper because of the advertisements or the models used to display it. Bata had to put in more on repeated exposure and take advantage of various mediums to do the same.

pair of their preferred Bata shoe. It helps individuals relive memories and reconnect with one another.

Bata Club Bata Club is a loyalty program which offers great rewards and privileges. Customers need to register their names & phone numbers to become a member. With every purchase at Bata stores, points equal to bill amount get added to the account which you can redeem at next purchase with Bata. Few other benefits include new registration bonus, Birthday bonus, Member’s sale day & Special products in store at exclusive prices for members. The Bata club has approx. 6.7 million members & is growing rapidly.

Marketing Campaigns “Where Life Meets Style”- Spring-Summer 2014 Marketing Campaign Bata India launched its new marketing campaign “Where Life Meets Style” in March 2014 for its entire range of footwear, bags, glasses and accessories. The campaign featured a 360-degree multimedia integration of TV commercials, cinema, print, radio, and innovative outdoor, promotions, events and

Repositioning Bata had initially positioned itself as a family store for all footwear and related products. Bata became a need brand as it positioned itself as providing products catering to the needs of the middle class sections of the society. Bata was loved by everyone in the family. The brand had something for every member of the household.

digital platforms. The T.V commercial aired across channels had been shot to capture a slice-of-life situation in the lives of people through the focus on footwear. It used a unique technique of depicting real life moments by showing the actions only from the knee down. It included a group of students eagerly looking at their exam results, colleagues watching a cricket match and young girls enjoying their ‘day out’. The film showcases the leading brands in their latest styles. The new campaign emphasizes fashion and comfort of Bata shoes. It is a remarkable milestone in Bata’s journey.

It came up with new brands like Marie Claire, Hush Puppies and North Star. Bata was known as a manufacturing company which produced footwear and sold them. It wanted to change its image from a manufacturing company to a marketing company. It wanted to be placed in the market as a fashion conscious and lifestyle brand. It decided to become more visible in shopping malls and create a shop-in-shop experience in multi-branded stores. The company also introduced international brands like Scholl, Marie Claire, Bubble gummers, POWER, and North Star.

“Have we met”- Campaign for shoe-lovers Bata tied up with Digital agency Section to launch a digital campaign ‘Have we met’ around the theme of nostalgia. It includes a microsite to extend online dedicated engagement and reach to reconnect with younger customers. It also has a short film that enacts the reunion of two lost friends through a pair of shoes. Section developed a digital platform for users to share a personal message to a friend and select a BEACON October 2016

During the last few years, Bata has focused on the modernisation of factories & manufacturing processes. Bata stores are being renovated to provide world class store ambience & delightful shopping experience. Bata plans to open 30 new retail stores, 30 new franchise stores & 5 destination stores with kid’s playing area, food court etc. every year. 7

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Collect’ where customers can shop online and get their products delivered to the local Bata shops, this would also help bring more customers to their shops.

To leverage the exponential growth of e-commerce Bata started with e-commerce division. Along with online business, e-commerce division focuses on tie-ups with reputed companies & banks like HDFC, Samsung, Spice Jet, State Bank of India etc. to increase the brand awareness & customer database. The launch of new Bata mobile application has strengthened its e-commerce business. Bata blog is a style inspiration for the young audience & a channel for online surveys & feedbacks.

Social Initiatives Bata launched ‘Bata Children’s Program’ (BCP) in 2010 to help disabled children in the communities where Bata is present. It has adopted schools in their areas of operations as a part of this initiative. It has carried more than 100 initiatives in 22 countries. Computer labs are set up at BCP schools in Bataganj and Gurgaon and were able to reach out to 150 girls. It also came up with Each One Teach One campaign where volunteers dedicate four to six hours every month to teach both curricular extra-curricular activities to underprivileged children. BCP came up with Each One Feed One campaign with The Akshaypatra Foundation, where the employees were requested to donate Rs 750 and with this, they provided meals to 200 underprivileged children. Other initiatives include Book Wall Campaign, Donation of fans in schools, Health check- ups, Infrastructure improvement in BCP schools.

Online Presence Apart from its vast offline presence, Bata is present online through its website bata.in and has its own delivery channel ‘Bata Home’. It has various categories ranging from women’s section to men’s, section for kids and different brands such as Angry Birds, Hush Puppies, marie claire, Sunshine and many more. The company has tie-ups with e-commerce sites such as Snapdeal, Jabong, Junglee and Rediff. In 2014-2015, its multi-channel business has performed very well and is expected to continue the same with its products and service. To facilitate the shopping ease, M-wallet service has been launched. The company website www.bata.in has been re-launched where customers can now their favourite products on social media. The company also came with ‘Click and

STP Analysis Segmentation: Segmentation involves finding out what kinds of consumers with different needs exist. Based on Demographics The demographic factors are age, Income, gender & occupation. Bata offers products mainly to men & woman above the age of 14, with limited products for school kids. Based on psychographic factors Personal Activities like hobbies, social events (marathon), sports, shopping and Personal interests like fashion, styles are considered in psychographic factors. Bata being the mother brand covers all these segments in their portfolio. Target: Target customer of Bata includes Price conscious

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eign Direct Investment (FDI) in the footwear manufacturing industry, the proposed reduction in excise duty on rubber sheets for soles & heels from 12.5& to 6%. Such steps by the government are beneficial for sector growth. Rapid change in lifestyle creates huge potential for footwear industry & Bata India with its relentless efforts continues to be the market leader.

middle-class families, youth looking for affordable & trendy products. It targets all the age groups & has something for every member of the family, i.e. men, women & kids. Position: Positioning is done in order to locate the brand in the minds of the customers. The positioning is done with respect to the brand and product portfolio. Bata positions itself as a brand that offers comfortable footwear & stylish accessories for the entire family at an affordable price.

References Ukessays Bata India Ltd. Annual report 2015-16

SWOT Analysis

world.bata.com

The government of India has now allowed 100% For-

marketing-interactive.com

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INSURANCE INDUSTRY ANALYSIS

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Overview

through network of hospitals, handling and settlement of claims.

The insurance industry in India consists of 52 companies in all

• Insurance Repositories are intermediaries introduced recently to electronically maintain data of insurance policies for ease in storage, retrieval and servicing of insurance policies

• Life Insurance (24) • General (Non-Life) Insurance (28) On 6th January 2000, the President of India gave his assent to the Insurance Regulatory and Development Authority of India (IRDAI) Bill, which enabled opening up of the insurance sector to private players.

Insurance Ombudsman • Grievance redressal mechanism is provided for in the insurance sector through the institution of Insurance Ombudsman set up under the Redressal of Public Grievance Rules, 1998.

Insurance Laws (Amendment) Act, 2015 has provisioned for increasing the Foreign Investment Cap in an Indian Insurance Company from 26% to 49% with the safeguard of Indian Ownership and Control.

• Complaints that can be taken are partial or complete repudiation of claims and delay in settlement, non-issuance of policy, dispute relating to premium and interpretation of clauses in relation to claim.

History

• If not satisfied, the policyholder may ignore the award and go to the court, consumer forum etc., and if the customer consents, the insurer has to implement the award unless it chooses to approach Court.

Market Size The life insurance sector in India grew from $ 10.5 billion in FY-02 to $ 61.78 billion in FY-15. In this period, the premium collected in life insurance expanded at a CAGR of 14.7%.

Segments of the industry Distribution channels and other intermediaries • Intermediaries involved in distribution of insurance products are agents, brokers, web aggregators, Common Service Centers. • Intermediaries like surveyors and loss assessors are involved in claim assessment of general insurance. • Specialized intermediaries for health services called Third Party Administrators (TPAs) operate in Health insurance for issuance of policy cards, for organizing cash less treatment facility BEACON October 2016

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The general insurance market grew from $ 2.6 billion in FY-02 to $ 13.9 billion in FY-15. In this period, the premium collected in non-life insurance expanded at a CAGR of 13.8%. The number of policies issued grew from 43.6 million in FY-03 to 126 million in FY-15, at a CAGR of 9.2%

future expenses. With a huge percentage of working age population with disposable income, it also acts as a tax-saving financial instrument.

Insurance density in India grew from 3.57 in FY-05 to 11.23 in FY-15 at a CAGR of 12.1%. Insurance penetration was 3.3% in FY15.

• Infrastructure and manufacturing sector on the way up

Premium collected by Indian insurers is 3.30% of GDP in“ ”FY 2014-15 Insurance Regulatory and Development Authority -

The ‘Make in India’ initiative will boost the manufacturing sector for all the industries. Consequently, this will make the stakeholders insure their cargo and properties. The infrastructure includes the construction of various amenities and facilities like dams, highways and the likes. Despite a gloomy global outlook, India has managed to maintain a good market sentiment in the infrastructure sector.

India is the biggest life insurance sector in the world with close to 360 million policies. India’s insurance market is expected to grow 4 times in terms of premium collected in the next decade. During this time, life insurance market is deemed to cross $160 billion. India's Insurance industry intends to reach penetration level of 5% by 2020.

• Travel industry upbeat

India currently accounts for less than 1.5% of the world’s total insurance premiums and about 2% of the world’s life insurance premiums in spite of being the second most populous country. It is the 15th

The tourism industry has benefited a lot with a weakened Dollar and other currencies. More people than ever are considering foreign destination for vacations. This complements the insurance sector since every leg of travel and stay is insured including the flights and other means of transportation. The passenger traffic is surging in the upward path thus improving the prospects of the insurance industry.

largest insurance market across the globe with respect to premium volume.

• Auto industry insurance surge Insurance covers for all vehicles is not a new factor contributing however it is worth noting that recent flooding events in Chennai caused a spike in the insurance claims. However, it also made automobile owners run for insurance cover to account for natural calamities.

Drivers for the Insurance Industry • Improving consumer interest in insurance and healthcare Healthcare facilities have improved with the cutting-edge technology but so have the costs. It seems a sensible choice to be insured to account for any such BEACON October 2016

Additionally, the insurance industry caters to an ever increasing market of automobiles in India.

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• FDI up from 26% to 49% The non-life insurers’ market is an altogether different story with private players dominating up to a very large extent.

Effective May 2015, the government liberalized FDI in the insurance sector from the then existing 26% to 49%. This substantial increase in the capital foreign investors can pump into the Indian market will definitely benefit this sector given how capital-intensive it gets.

The comprehensive list of life and non-life insurers can be accessed at below link: http://www.policyholder.gov.in/Meet_the_Insurers.aspx

According to IRDAI, the total FDI in insurance sector as on“ March 31, 2015, was about Rs.8,031 crore.” -ASSOCHAM LIC* ICICI Prudential Bajaj Allianz SBI Life Insurance HDFC Life Insurance United India Insurance Birla Sun Life Reliance Nippon Life Insurance

Major Players in the Insurance Industry Life Insurance Corporation of India has a lion’s share in the pie. A 69% market despite numerous players has been strongly based on its brand and credibility as a representative of the government.

Max Life Insurance

2014

2015

2016

(` Crore) 1656 1566 1024 740 725 527 370

(` Crore) 1823 1634 876 820 785 300 285

(` Crore) 2518 1650 878 861 818 200 140

358

135

197

435

414

439

)PAT for major players (Source: respective annual reports As per section 28 of LIC Act, 1956, 95% of the profits are* returned to policy holders through bonuses effectively meaning the profits on the P&L statement are 5% of the actual

News & Developments • FDI limit hiked up to 49% from existing 26% Paving way for FIIs to invest in India, the government has taken another step towards progress. With a substantial capital inflow, the insurance sector can definitely attract more takers with innovative schemes and improved services ensuring the incumbent leaders do not slack up. • Pradhan Mantri Suraksha BimaYojana As an initiative to improve insurance penetraBEACON October 2016

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tion, Government of India introduced the above scheme wherein for a nominal premium of Rs.12 per annum, an individual is insured for maximum sum of Rs.2 lakh.

er to switch insurers if he does not continue to see value for his investments. This threat is compounded by the fact that the regulator facilitates such a move called “porting”

• Health insurance portability Though not a latest update, this policy update has remarkable implications with the consumer benefited in terms of service provided by insurers. All insurers must allow credit gained by the customer for existing conditions (sum assured, premiums, waiting period, etc.) if consumer decides to switch the insurance company or the plan. • IRDA (Issuance of Capital by General Insurance Companies) Regulations, 2012 This amendment provides for an insurance company operating for more than 10 years to raise capital through IPOs subject to fulfilling other prerequisites.

• Bargaining Power of Customers The customer is indeed the king here since he has tremendous bargaining power in terms of the customizations he needs and the options he has. Insurers today have agents servicing individual customer requirements. This has made insurance easily accessible to anyone.

Porter’s Five Forces Analysis

• Bargaining Power of Suppliers Suppliers here are the insurance distributors/ agents. They tend to have a lower bargaining power than the customers partly because volume of policies is an important target. Competitors only make it more difficult for them to hold any kind of advantage with the insurance companies since policies can be substituted easily. With the advent of E-Commerce, insurance can be obtained without any interaction with agents. This is another roadblock the suppliers face reducing their weightage since insurance companies utilize these alternative modes of communications which are easier and cheaper.

• Existing Competitive Rivalry With 52 players in the arena, the competition has heated up with the consumer having multiple choices to choose from. Though LIC of India has the majority of the market share and despite any unlikely changes in the incumbent’s outreach, the private players are coming up with innovative schemes to attract the customers. • Threat of Substitutes Though there exist a limited number of competitors, the threat of substitution is substantial since the insurance products are evenly matched in almost all aspects. It becomes easy for the consumBEACON October 2016

• Threat of new competitors 14

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Licensing and regulations are strictly enforced by IRDA making it a not-so-easily-accessible market for private players to enter. An organization with enough financial backing and a brand name can establish itself but despite liberalization since 1991, very little has changed in this industry with LIC of India being the most trusted and go-to brand.

Conclusion The insurance industry as we have today is dominated by LIC of India. It would definitely be a Herculean task to displace it off the pedestal as its firmly placed due to the legacy it carries and the people outreach it has. Private players will find it difficult to sustain in such choppy waters. The only approach as of now they can adopt is to fend off the competition before even considering to take on the industry leader.

Investments in Insurance Sector • Aegon has increased its investment in Aegon Religare Life Insurance Company Ltd. from 26% to 49%

From consumer perspective, the options have increased and improved with customizations available to suit individual requirements. This coupled with an augmenting penetration of insurance for has ensured this sector progresses with time. It’s a bright outlook to this industry despite the trying times for the world economy with a sluggish growth.

• Japan’s Nippon Life Insurance increased its stake in Reliance Life from 26% to 49% in a deal worth Rs.2265 crore with total stake valued at Rs.8630 crore.

References

• Bupa group raised its stake in Max India Life Insurance from 26% to 49% in a deal worth Rs.207 crore.

IRDAI Annual Report 2014-2015, Insurance Sector in

India - IBEF, Indian Insurance Market, Insurance Trends - policybazaar.com, Insurance Industry – Challenges, reforms and realignment (E&Y), CRISIL – ASSOCHAM Insurance Report

• France’s AXA invested Rs.1290 crore in Bharti AXA Insurance to increase its stake by 23% to 49%

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MTV EVENT REPORT BRAND ANALYSIS GUEST LECTURE

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Event Report - Guest Lecture SIMCON organized a guest lecture by Devang Mehta, Head & Senior VP, Wealth Advisory, at BNP Paribas on 4th of September, 2016. He is the alumni of JBIMS from the 1996 batch with diploma in investment studies and has worked with top notch firms like Anand Rathi Securities and Angel Broking­. The lecture revolved around the discussion on evolution of financial markets in the Indian economy. Mr. Mehta started the lecture by talking briefly about his career in finance. He then discussed about the Indian stock markets NSE and BSE, giving basic idea about the need for stock markets, how BSE started in 1855

analysis of the stocks and securities listed on a stock exchange. The fundamental analysis also known as the top down approach helps relate the fundamental factors to the performance of the company, the industry or the economy and thus provides an analytical framework which helps in decision making. On the other hand technical analysis is basically the study of the market carried out as a supplement to the fundamental analysis. It is basically the study of variation of stock price based on its demand and supply in

the market and provides a simple and inclusive picture of the price of security. Sir then discussed about the effects of stock markets on Indian economy, stating that if the stock markets do well then it creates a sense of confidence about the direction of the economy. Sir also talked about negative interests rates in ageing countries like Japan. The students found the lecture beneficial and an engaging one where they asked questions related to the topic and Mr. Mehta answered them all. We thank Mr. Devang Mehta for taking time out from his busy schedule and sharing valuable knowledge with the batch.

wherein 5 stockbrokers would sit under a banyan tree in front of Town Hall in Mumbai which later shifted to Dalal Street in 1874 and became an official organization in 1875. BSE became the first stock exchange to be recognized by Indian government in 1956 under the Securities Contracts Regulation Act. In the year 1980 BSE moved to Phiroze Jeejeebhoy Towers at Dalal Street in Fort, Mumbai which has been home to the stock exchange till date.

Key Takeaways Fundamental and Technical analysis The fundamental and technical analysis is carried out to predict the price of a security by studying the factors affecting the economy, industries and companies. The fundamental analysis studies the effect of economy, industry on a macro scale and microeconomic factors such as company’s financial condition

Mr. Mehta then talked about the advent of Securities and Exchange Board of India (SEBI) that worked as a regulator for securities market; he then talked in brief about the Demat (Dematerialized) accounts which are used to hold the shares electronically. Moving ahead, he talked about fundamental and technical BEACON October 2016

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valuable assets, a strong balance sheet, stable earnings, and staying power, and it also provides the good understanding of the business & also key value drivers within the company.

and its management. The main objective is to determine the direction of national economy as it affects the corporate profit, investor attitudes and expectations, which thus helps in investing at right time in right security. Fundamental analysis is a three phase analysis, which includes analyzing economy, industry, and company. Economic analysis helps assess economic situation of the nation, industry analysis

Technical analysis is directed towards predicting the price of a security. The price at which a buyer and seller settle a deal is considered to be the one precise figure which synthesis, weighs and finally expresses all factors, rational and irrational, quantifiable and non-quantifiable and is the only figure that counts. The most commonly used method for technical analysis is the Dow Theory. According to Charles Dow “The market is always considered as having three movements, all going at the same time. The first is the narrow movement from day to day. The second is the short swing, running from two weeks to a month or more and the third is the main movement, covering at least four years in its duration”. It states that the behavior of the stock is 90% psychological and 10% logical. The Dow Theory only determines the direction of market and not the actual stock prices or the future movements of the market.

is done to gain insight on prospects of a group of industries and lastly, company analysis is done to analyze financial and non-financial aspects of the company to determine whether to invest in that company or not. Fundamental analysis helps in making long term investments, spotting the right company with

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One of the basic tools used in technical analysis is charting. It is believed that stocks follow a particular trend due to an inbuilt inertia until an opposite force created by the demand-supply changes acts upon it.

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CONCEPT OF THE MONTH BUG BOUNTY

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Concept of the Month – Bug Bounty

ed security bugs by issuing them custom branded ‘White Hat’ debit cards that can be loaded with funds every time the researchers discover new vulnerabilities.

A Bug Bounty program is a challenge offered by companies for reporting bugs and security lacunae with their website or software. The individuals who point out the vulnerabilities are recognised and awarded with monetary prizes. Such programs ensure that the company identifies and looks into the issues before it gets exposed publicly. Bug bounty programs have been implemented by giants like Apple, Facebook, Google, Yahoo, Microsoft, Reddit etc.

Origination and History

In 2014, Facebook stopped issuing the debit cards. Since it launched in 2011, Facebook has awarded around $4.3 million to a little more than 800 researchers. The Facebook bug bounty program determines the payout based on the level of a bug's risk than its complexity. In the year 2015, total amount of $936,000 was rewarded to 210 researchers with an average payout of $1,780. Recently, a 10 year student from Helsinki has become the youngest recipient of a $10,000 award under the program, after he found vulnerability into the photo sharing application – Instagram.

The original ‘Bugs Bounty’ program was created by an employee of the Netscape Communications named Mr. Jarrett Ridlinghafer. Mr. Ridlinghafer recognized people who were interested in finding the bugs in different browsers and discovered that many of those were software engineers who were fixing the bugs and publishing them on the ‘Netscape U-FAQ’ website or on the news forums along with the workarounds of these bugs. Ridlinghafer thought that the company should leverage these valuable resources and drafted out a proposal for the 'Netscape Bugs Bounty Program'. The first official 'Bugs Bounty' program was launched in the year 1995 and turned out to be a huge success.

United Airlines announced a bug bounty program where the reward was given in the form of ‘free air miles’. The reward was based on the basis of the complexity of the bug. It did not include the flaws found on aircraft such as avionics or in-flight wifi. Also, the regulations stated that the researcher should not disclose the flaws to public or any third party. Google announced a major change to its ongoing Vulnerability Reward Program in the year 2013. Previously, it used to cover Google products in its program but the new program was expanded to include high-risk free software applications and libraries primarily designed for networking or low-level operating system functionality. Reward amounts for qualifying bugs range from $100 to $20000. Microsoft and Facebook partnered in 2013 for pro-

Bug Bounties Some of the Notable Bug bounty programs in the recent years are as follows: Facebook started paying researchers who reportBEACON October 2016

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viding financial support to The Internet Bug Bounty - a program designed to offer rewards for reporting hacks and bugs for a wide range of softwares. The softwares covered by the program include Adobe Flash, Nginx, Ruby PHP, Ruby on Rails, OpenSSL, Python, Perl Apache HTTP Server, Django and Phabricator. This program assisted in harnessing the collective intelligence of the security researchers to help protect valuable customer data. In 2016, US Department of Defence announced its bug bounty program known as the ‘Hack the Pentagon’ program. The program targeted public facing websites and had paired up with HackerOne – a Silicon Valley based firm who advised, operated and executed the program. The program ran for duration of 25 days and saw 1410 hackers submitting 138 legitimate reports. HackerOne promptly paid $75,000 as rewards to the researchers.

also be controversial. Hackers can pose a threat of exposing the vulnerability to the world if the developer organization fails to respond promptly. Also, such a program cannot completely eliminate the need of research and inspection processes. To limit this potential risk, some organizations are offering closed bug bounty programs that require an invitation. For example, Apple has limited bug bounty participation to few researchers. Bug bounty sponsors have found a way to make all the searching and failing time cost free to the software companies. Though they are in essence an extension of security testing programs and are time saving and relatively cost effective, companies should ensure effective implementation of such programs.

References: History of Bug Bounties - BugCrowd, Microsoft Security: Security Vulnerability, Hack the Pentagon Bug Bounty Cybersecurity Program: from idea to successful results – HackerOne, 10-year-old gets $10,000 bounty for finding Instagram vulnerability | Ars Technica

Conclusion While the use of ethical hackers to find bugs can be very effective and organizations have been benefited with such bug bounty programs, such programs can

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OLA CASE STUDY

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Introduction to case

the company and hence their misbehavior directly affects the brand image. Hence training them and teaching them to use technology was a major challenge.Further safety and quality of service was important. Following was the tweet made by one of ola’s customer expressing inconvenience caused due to  Ola Cab’s personnels service.

Ola is India’s first and largest aggregator of cabs,it  is the result of brainstorming idea of 2 IITians Bhavish Aggarwal and Ankit Bhati. They set up the firm in January 2011 with its operation limited to Mumbai only. Now it is the largest cab-booking service provider in India and provides service in around 100 cities .

Recovery strategy

Ola translates to ‘Hello’ in Spanish. Probably to indicate that their services are as easy and friendly as that, just like saying a ‘hello’.

Hashtag campaigns Ola Cabs’ topical and continuous use of the hashtag has enabled it to become one of the most well known radio cab brands on social media accord-

Ola integrates car transportation within the city onto a technology platform, ensuring convenient, transparent and quick service fulfillment for the customers and driver partners. Customers can access Ola on the web, through the mobile app or through the customer service centre. But Journey of Ola cabs was never so easy as there were many challenges thrown by Uber. This is because Uber is a San Francisco based taxi aggregator valued at $40 bn as compared Ola valuation of $2.5 bn. Uber has a war chest of $1.5 billion for international expansion and has committed $400million to grow and expand its services in India.

Challenges faced by Ola • Failed ad campaign Creating brand awareness is crucial during initial phase of any product. Ola’s initial offline “ChaloNiklo” brand campaign did not get desired results. It did not utilize social media to target right audience. • Surge Pricing The reason given by aggregators for surge pricing is more demand. However It was believed the drivers may be playing the system. Drivers concentrate in one location, switch off their app, and create artificial scarcity. They use the second phones to keep track on the rising prices. Once the surge begins, they log back again. • Customer complaints Drivers are the face of BEACON October 2016

ing to a report by Simplify360. Along with catchy hashtag campaigns, their association with popular events is also another reason for their high popularity among social media users. For example, Ola ran the #AccesstoArmin campaign during Armin 23

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van Buuren’s performance at this year’s A State of Trance.

chance from the dissatisfied client. • For winning the trust of a dissatisfied client, understanding of the damage caused is important. • Creativity hitting the direct cause help in converting frustrated client into Brand Advocate. • Customer’s tweet :-

Ola’s response:-

Mobile app awareness • Facebook has designed a customized mobile specific methodology by the name ‘App Analytics’, that enables apps to track and measure performance. It enabled Ola to track its performance and make informed decisions about reaching their customers. • Olacabs is run by Mumbai-based ANI Technologies Pvt Ltd. Of the total, around fourfifths of the bookings come from mobile.

The Other differentiators of Ola

• The meteoric growth of Ola cabs is due to intensive use of high technology, namely use of Google maps, fully automated operations, New security features in Apps ,Use of data analytics software, ease of payment (using OlaMoney), tie-ups with clubs, sponsoring events.

• Convenience - “Book within seconds and get instant confirmations. Easy online payments or cash on delivery. Booking car rentals will never be a headache again!” •

Quality - “Our cars are audited for cleanliness, safety and comfort. Our drivers are well trained and reliable. Sit back and enjoy the Ola experience!”

•

Control- “ We have clear and transparent pricing listed online. Never haggle with drivers again on payments and be confident and assured of what you are being charged for!”

Customer centric approach For any company to perform well it’s Customer satisfaction Index should always be on higher side. Ola followed below mentioned principles for the same• Immediate acknowledgment of the mistake gives relief to the frustrated client.

• Further Taxi for Sure was acquired by Ola for $200 million i.e., Rs 1200 crore in March 2015 (Business Standard Reporter, 2015).

• A genuine apology from the company increases an opportunity of getting a second BEACON October 2016

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• BlaBlaCar is a French startup building a community marketplace that connects drivers with empty seats to passengers looking for a ride. Car owners and ride-seekers sign up as members of BlaBlaCar much like a social network.

Number crunch • Ola's revenue is growing at an average of 30% month on month (fastest in its league) and at least 2000 cars get added on the platform every month pan-India. • Over 70% of the bookings come through the mobile app! The rest significantly comes through the call centre and a small number via the website.

• Sidecar is a Transportation Network Company that connects people for shared rides with operations based in San Francisco. Will Ola succeed or fail in the long run, only time would tell us. Till then, we say, “Ole, Ole, Ola!”

• Ola has raised ~$70mn through venture capital funds and has prestigious investors like Tiger Global, Matrix Partners, Steadview Capital and Sequoia Capital on board.

(PS - Ole: A Spanish word used as a shout of approval, triumph, or encouragement)

Global Examples and Success Stories:

Bibliography :

• Lyft is a privately held, San Francisco-based American transportation network company. The company's mobile-phone application facilitates peer-to-peer ride sharing by enabling passengers who need a ride to request one from available "community drivers".

BEACON October 2016

SDMIMD | Honoring a Commitment, Digital Marketing Training courses, Delhi School of Internet Marketing, Chandigarh Institute of International Marketing, Yourstory, Indian Advertising Media and Marketing News, Analytics India Magazine

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