L6
www.livemint.com
SATURDAY, JANUARY 22, 2011
Business Lounge
LOUNGE
MAHESH MADHAVAN
The many messages in a bottle A deep understand ing of the spirits industry drives Bacardi India’s CEO to bigger things— including taking on Old Monk
B Y K RISH R AGHAV krish.r@livemint.com
···························· ahesh Madhavan, 48, is the man partly respons i b l e f o r t w o o f t he most iconic advertisements in India of the 1990s. In 1994, when he was product manager at spirits firm Diageo (then called IDV), the company aired the famous “looking through the bottle” Smirnoff vodka advertisement. In it, a bored wedding guest sees the
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Spirited: Madhavan’s fiveyear plan focuses on two key areas— making the business selfsustaining and shifting Bacardi’s communication strategy away from the ‘traditional’ media.
world in a new light after peering through a bottle of Smirnoff. Sequins on a woman’s dress come alive and crawl all over. A boisterous and fiercely moustachioed man turns into a walrus. For a country used to alcohol being peddled by dart-throwing men attributing their prowess to Haywards 5000, this was a refreshing revelation. Four years later, as marketing head of rival spirits brand Bacardi, his team announced their entry into India with a message of “sun
and sunshine”. “Nothing is as nice/as finding paradise/and sipping on Bacardi rum,” went the ad’s supremely catchy jingle. Madhavan is a 17-year veteran of the spirits industry. We meet in the afternoon in the lobby of The Taj Mahal Hotel on Mansingh Road in Delhi. Dressed in a crisp suit and looking younger than his age, he arrives right on time. “Shall we order some lunch first and then talk?” he asks, and we adjourn to the nearby Wasabi restaurant. Madhavan is in the mood for food—he’s judging a cocktail competition later in the evening, and is required to down more than 20 drinks one after the other. An eminently suitable end-of-day itinerary item for the CEO of Bacardi in South Asia. Madhavan speaks in a calm, quiet, deadpan manner, dictating the pace of conversation. He also listens intensely. “I try to take away something from every interaction I have,” he says. He started his career as an engineer. His first job in 1985 was at the Mazagon Dock Ltd in Mumbai, where he was part of a team that built offshore oil rigs for Oil and Natural Gas Corporation (ONGC). He was paid `700 a month. “I did that for about a year, didn’t like it. So I moved to Tata Electric—working at Trombay.” This was a trying period for Madhavan. His father died in November 1985 and as the eldest son, he had to take important decisions on behalf of the family. “On top of this, I had to work variable shifts—one week it was 6pm-2am, the next it was 10am-6pm.” He remembers having to leave his house in Colaba at 3.30 in the morning to make it to work by 6. “I decided to take the plunge and go back to studying. I was the only earning member of the family, so this was a tough decision,” he says. He ploughed in the family savings and applied for an MBA at the SP Jain Institute of Management and Research in Mumbai. Two years and a degree later, he joined Wipro Consumer Care as a management trainee. His first boss was a “tough, hard-nosed” area manager called Hemu Javeri. “He took me on as a salesman, and my beat was Kurar village near Malad East,” he says. “Here I was, after years of engineering and management education, selling Santoor soap to kirana shops.” After six months, he was sent into interior Maharashtra, travelling on rickety buses to stay in decrepit hotels. “Looking back, this was some of the best experience I could have got,” he says. “Most business graduates today want to be CEOs in five years and
sit in plush cabins right out of college.” He owes a significant part of his understanding of relationships and the value of money to his time at Wipro. Madhavan moved to Ulka Advertising in 1992 in Mumbai, where he serviced clients such as ITC Sundrop. He describes his time there as “great fun”. He moved to Diageo in 1994 to head their entire white spirit portfolio in India, which included brands such as Smirnoff, Malibu and Kelly’s (a variant of Baileys Irish Cream). In 1997, he moved to Bacardi as head of marketing in Gurgaon, having been handpicked by the then managing director Jayant Kapur. He was one of the company’s first employees in India. “I haven’t looked back since,” he says. At this point, the restaurant manager takes advantage of a split-second silence in our conversation to insist we order food. I ask for a Ramen lunch set. Madhavan is fine with anything that is not “sushi or sashimi”. I ask him why. “I’ve had a lot (maybe too much) of Japanese cuisine—it was one of my favourites.” During his seven-year stint at Bacardi in Thailand, his residence was next to a Japanese community. “Food is never a problem for me, really. Anything other than a burger is fine.” This distaste for one of globalization’s biggest imports is a consequence of his son (who is now 18) insisting on eating at McDonalds at every opportunity when he was young. “It’s one food I can never enjoy. It’s not nourishing,” Madhavan says. The shift to Thailand occurred in 2001 because of an “itch I get every three years”, he says. “Once you’ve done a particular job and finished what you set out to accomplish, you get this thing of ‘what shall I do next?’” After bothering the boss for something “new and challenging”, he was asked if he wanted to go to Thailand. He said “no problem”. He and his family packed their bags and moved, and Mad havan found himself the only Indian among 70 employees, all thinking “who is this Indian who comes here and tells us how to run our business in a market that we understand better? “It took me two years to get their respect. First, I had to unlearn all the Delhi aggression that was coming out, including thumping on tables during meetings,” he says. Madhavan returned as the CEO of Bacardi India in 2007, and is now the president and CEO for Bacardi’s South Asia operations, based out of Gurgaon.
India is a complex beast. The tax and duty structure is a byzantine mess and levies are much higher than other South Asian countries. “Sixty per cent of the market in India is whisky,” he says. “There are pockets of brandy, like Tamil Nadu, and pockets of dark rum, like Kerala and West Bengal.” Madhavan’s five-year plan focuses on work in two key areas—the first is making the business self-sustaining by building both local and imported brands. “We’re growing fast and we’d like to keep that momentum going,” he says. Bacardi is promoting Eristoff, its local vodka brand, heavily and is launching Bacardi Black, a dark rum, to take on the dominant Old Monk and Celebrations brands. The company is also building a line-up of imported brands, from Asti sparkling wine (“it’s nice and sweet and bubbly”) to Otard Cognac (“there’s not much pull for cognac in India yet, but it’s a fine drink”). The second is to shift Bacardi’s communication strategy away from “traditional” media. Part of this is continuing their association with electronic music and nightlife parties. Just last week, Eristoff sponsored the Invasion Music Festival that saw electronica giants The Prodigy play to audiences of over 6,000 people in Delhi and Bangalore. In December, Bacardi was the lead sponsor for the NH7 Weekender music festival in Pune, where close to 5,000 people listened to concerts and consumed copious quantities of Bacardi alcohol over three days. The company has launched an online music store called MixBacardi, and efforts are under way to increase the number of Facebook fans to 100,000. “The future of communication is online and interactive. There’s only so much a TV ad can do these days,” he says. As we settle the bill and dessert arrives, I ask him his drink of choice. “Vodka and tonic. I like Eristoff vodka—it has a nice bite to it. I also like Bacardi Mojitos. What about you?” I spout my usual propaganda about the virtues of Sikkim dark rum. Madhavan hasn’t heard of it. “Is it a bit like the Khukri rum you get in Nepal?” he asks. “Better,” I reply with misplaced confidence. “Interesting,” he says. “I will try this out.” I nod in agreement. I may have just given Madhavan his significant “takeaway” from this interaction.
IN PARENTHESIS Madhavan likes activities that give him time to reflect—on work, life and the possible future. “Most of the stuff I do tends to be very individual,” he admits. Fishing was a favourite timekiller, something he misses doing in India. “In Thailand, I fished a lot. I love the quiet calm of the wait contrasted with the excitement of a fish biting,” he says. Gardening is another. He grew orchids in Thailand, and has shifted to seasonal flowers in his current place in Gurgaon. “I was just at a nursery near the Qutub Minar the other day,” he says, “picking up flowering seeds for the winter.” Madhavan has also been an avid aquarium keeper. “I went to a fish store in Delhi thinking I’ll restart the hobby here,” he says glumly. “But this city has very bad fish.” JAYACHANDRAN/MINT