BEDFORD, Mass. - Sometimes, the marketing means more than the merchandise.
To underscore his point, Muktesh "Micky" Pant, chief marketing officer of Reebok International, noted: "I have a budget of $300 million."
From tea bags to top-selling sneakers, Pant pointed to cases illustrating marketing's central role in boosting sales to consumers. For Reebok, marketing means linking its products to rap stars, and wrestling laughs from SuperBowl audiences with a zany "Office Linebacker."
Large international companies often spend 10 percent of their revenues on marketing - "much more than what they spend on research and development," Pant said.
Pant was a guest speaker at a dinner recently organized by the Indian Institutes of Technology Society in New England. The event was at the Renaissance Hotel in Bedford.
A 1976 graduate of the IIT in Kanpur, Pant majored in chemical engineering, but has worked in marketing his whole life.
Speaking to an engineer-dominated crowd, he acknowledged that technology and innovation may play a huge role when a product or concept is new.
Dell Computer Corp., for example, grew rapidly when it broke with industry practices as it used a mail-order system and offered low prices, he said. Now, however, the pricing of PCs is quite competitive - and Dell has lost the edge it got from its innovative approaches.
That's where marketing comes in.
The rivalry between Lipton and Tetley teas underscores that "the packaging is as important as the product," Pant said.
Before working at Reebok, Pant held a number of marketing positions at Unilever, where he was in charge of the Lipton tea brand.
In 1985, Tetley introduced tea in round bags, as opposed to the traditional square ones. "Our scientists and engineers all said this was messy, inconvenient and would go away," said Pant.
Ultimately, they were proven wrong.
Lipton was convinced its tea was better, Pant said. So, Unilever funded a taste-test study that gave the same tea to two different groups of people. One was told the tea was made from leaves in round bags; the other was told it was square bags.
When asked to rate the product, "the people who were told it was round-bag tea said it tasted better," Pant said. It was "amazing" to see such findings, he said.
By 1991, Tetley's round bag was the industry leader for sales, he said.
"Marketing is the art of creating or changing perception," said Pant. Particularly for his company, this means dealing with fashion and, lately, popular music.
In 2002, Reebok launched a new brand, Rbk, which is pitched to fans of hip-hop. Earlier this year, Reebok released a new footwear line linked to rapper Jay-Z and dubbed the "S. Carter Collection by Rbk."
This month, the company plans to unveil a new sneaker linked to top-selling rap star 50 Cent. The company is calling these offerings its "Sounds and Rhythm of Sport" marketing platform.
As Reebok pursues these new markets, the company remains anchored in sports and the traditional role played by athletes, Pant told IndUS Business Journal. He pointed to recent endorsements of Reebok sneakers by basketball star Allen Iverson.
On the zany side of advertising - up there with Anheuser-Busch's cartoon frogs - is Reebok's "Terry Tate: Office Linebacker" series, which stars former college football player Lester Speight, who now goes by the name The Mighty Rasta.
The first commercial was aired during the SuperBowl early this year. With this campaign, Reebok avoided the burnout effect commercials run into: Audiences tire of even clever ads. The commercial only ran during the SuperBowl - not for weeks and months.
An extended version of the ad is highlighted on Reebok's Web site.
The slapstick comedy was such a hit that such media outlets as ESPN interviewed the office linebacker live. Tate is known for tackling people in the office who fail to clean up after themselves or get caught playing online card games.
"It really became a cultural phenomena," said Pant.
In fact, the campaign has little to do with sneakers. Its creators had first shopped the idea around to beer and soft drink companies, but kept getting turned down, Pant said.
But, for Reebok, Tate was a home run. Or maybe that's a touchdown. Either way, Pant said the series has garnered Reebok millions of dollars in free publicity.