MAM
Marketing lessons a la AAP
MUMBAI: The recent-concluded Delhi elections, took everyone by surprise when Aam Admi Party won 28 seats. We take a look at what one can learn from the new entrant.
When it was formed less than a year ago on 26 November, 2012, little did the Aam Aadmi Party imagine it would make such a big splash at the polls.
Winning 28 out of 70 seats in the Delhi Assembly elections on 8 December, the AAP came a close second to the BJP which won 31 seats, pushing the ruling Congress to an irrelevant third position. What’s more, three-time Congress CM Sheila Dixit suffered defeat at the hands of AAP chief Arvind Kejriwal. Before the elections, the now ex-CM of the national capital, didn’t think before making statements like, “Arvind isn’t even on our radar.” Dixit probably forgot the legend of David Vs Goliath.
For a fledgling party which emerged as an offshoot of the larger ‘India against Corruption’ movement launched by activist Anna Hazare -where people took to the streets to protest the many ills plaguing the current administration – this is no mean feat.
And neither is the fact that AAP – registered as a political party with the Election Commission (EC) only in March this year – has successfully met the EC’s criteria to become a state party.
So what did the AAP do right to banish all the scepticism its broom-wielding members met with from seasoned politicians who dismissed the party, at least initially, as ‘chillar’ or worse, a group that made a lot of noise but had no real impact.
Looking at the AAP’s historic win from a marketing perspective, we at indiantelevision.com believe brands may do well to take a few lessons from the party’s promotional strategy:
* Strong USP
Each brand need to have a very strong USP which helps position it in the minds of the target audience. AAP’s USP is that it gives the common man a belief, a hope, that there is going to be a better tomorrow, and that it has been created by the common man who is fed up of the politics of politics, and will hence deliver on its promise.
*Be consistent
At the heart of the AAP’s party manifesto is its stand against corruption – which cuts through classes. And it has not deviated from that. It has refused to ally with either the Congress (I) or the BJP, despite there being a possibility of it occupying the seats of power in Delhi.
Brands need to stick to their core premise and promise and not try to ride fads.
* Marry your brand USP with the brand mnemonics
The AAP has always had one agenda – the aam aadmi, and it has stayed true to it ever since inception. Party members are common people who have volunteered and are unpaid. They come across as common people; they dress up like common people; they move around like common people. Even though many of them are well educated.
And during this election campaign there was none of the largesse distribution or ostentation that the general political parties generally resort.
The choice of name and the symbol in the case of the AAP was also crucial. The name says it all -Aam Aadmi Party. Then the symbol was the killer: what is the one thing that is still common across all homes in India, even in middle-class and upper class homes and hutments – it is the broom. Using the broom as the mnemonic meant many things: it will be used to sweep clean all the dirt in the political system, while it helped identify the common man with a tool that is used in his/her home every day.
* Know your customer; make him your network and your ambassador
The AAP needed to connect with its customer: the electorate of New Delhi. Almost 130,000 volunteers all over the world, some of whom descended on Delhi before the election campaign became both the best focus group and research agency anyone could ask for.
Some executives even took leave from their high paying jobs in India and overseas, housewives found time from their day to day chores, young college students, technicians, labourers, cable TV operators – everyone pitched to connect with the consumer and pass on what troubled the common Delhi-ite – crucial information to the central headquarters of the AAP. And they then propagated that further themselves to the electorate.
With millions of products overflowing on shop shelves and online, brands need to know what their customers really want, when they want it and how they want it, and in the process make them your ambassadors and messengers.
* Choose the correct medium at the correct time
AAP had little financial resources at its disposal; some say less than Rs 20 crore. That’s probably what’s spent by politicians on a couple of constituencies. Once again volunteers stepped in to build the buzz.
Twitter, facebook, online, print, and television. AAP went the whole hog on all the mediums. But not to splurge; just to have its message heard. The media were relatively complying: did not the common man also work in media? It hooked the middle class and the upper middle class through social media.
And what about the man on the street? Well it used direct selling: volunteers went door to door to the electorate in Delhi, connected with the common man. In trains, in buses, on auto rickshaws, in jhuggis, in bastis – there was the huge poster campaign, and it was the educated folks who went where they normally would not.
Brands have to be careful about the medium they choose and utilise it to maximise impact. Brands too have to keep themselves in people’s mind through various activations/campaigns especially in today’s market where the sharks are ready to rip apart any competition.
Most business owners treat their working capital limit like a safety net. It sits there, attached to their current account, ready to be drawn on whenever cash gets tight. And for routine operations, that arrangement works fine. But there are specific situations where a lump-sum loan disbursed quickly into your account is the smarter financial move. Knowing when to pick one over the other can save you real money and keep your business from getting stuck.
The Fundamental Difference People Overlook
A working capital limit, often structured as an overdraft or a revolving credit facility, gives you access to funds up to a pre-approved ceiling. You draw what you need, pay interest on what you use, and replenish it as receivables come in. It is designed for short-term, recurring needs like paying suppliers or covering payroll gaps.
A term loan disbursed quickly, on the other hand, drops a fixed amount into your account. You repay it in instalments over a set period, with a clear end date. The interest rate is typically fixed or at least predictable. These two products solve different problems, and treating them as interchangeable is where businesses get into trouble.
When Speed and Certainty Matter More Than Flexibility
Here’s a scenario that plays out constantly. A retailer gets an opportunity to buy inventory at a steep discount, but the supplier wants full payment within 48 hours. The retailer’s working capital limit is already partially drawn. The available balance might cover part of the order, but not all of it. Requesting a limit enhancement takes days, sometimes weeks, because the bank reassesses your financials.
An instant business loan solves this cleanly. You apply, get approval quickly, and the full amount lands in your account. You buy the inventory, sell it at full margin, and repay the loan over the next few months. The cost of interest on that loan is far less than the profit you would have lost by passing on the deal.
This pattern repeats across industries. A logistics company needs to repair a critical vehicle immediately. A restaurant has to replace kitchen equipment before the weekend rush. A manufacturer lands a large order but needs raw materials upfront. In each case, the need is urgent, specific, and finite. A revolving facility wasn’t built for these moments.
The Hidden Cost of Over-Relying on Working Capital Limits
There’s a psychological trap with revolving credit. Because it’s always available, business owners tend to lean on it for everything, including expenses that really should be financed separately. When you use your overdraft to fund a one-time capital purchase, you reduce the buffer available for daily operations. Then, when a genuine cash flow gap appears the following week, you’re scrambling.
Worse, many working capital limits come with annual renewal. If your financials have dipped, the bank can reduce your limit or decline renewal altogether. If you’ve been using the facility for purposes it wasn’t designed for, your utilisation patterns can actually work against you during the review.
A distinct term loan keeps your working capital limit clean. Your revolving facility handles day-to-day operations. Your loan handles the one-off expense. This separation makes your balance sheet easier to read and your banking relationship easier to manage.
Interest Rate Math That Favours Term Loans
Working capital limits often carry floating interest rates pegged to the bank’s benchmark. The rate adjusts, and over time, especially when monetary policy tightens, your cost of borrowing can creep up without you noticing because you’re only looking at the small daily interest debit.
A fixed-rate term loan gives you certainty. You know exactly what each instalment will be, which makes cash flow forecasting more accurate. For a specific expense with a known amount and a defined payback period, this predictability matters. You can map the repayment against the revenue that expense is expected to generate.
A working capital loan structured as a revolving facility makes sense when your borrowing needs fluctuate week to week. But when you know exactly how much you need and roughly how long it will take to pay back, a term product is almost always cheaper in total interest cost. The discipline of fixed repayments also prevents the slow balance creep that plagues overdraft users.
When Your Facility Is Maxed and Opportunity Knocks
Perhaps the most compelling case is the simplest one. Your existing limit is fully utilised. Business is good, money is coming in, but right now the account is stretched. A new opportunity appears. You can either let it pass or find additional funding fast.
Waiting for a limit increase is not a strategy when timing matters. Applying for a separate short-term loan, getting approval the same day or the next, and funding the opportunity directly is a concrete action with a measurable return. You are not adding long-term debt to your balance sheet. You are financing a specific transaction that pays for itself.
The smartest business owners don’t treat all credit as the same. They match the product to the need. Revolving facilities handle rhythm. Term loans handle moments. Getting that distinction right is one of the quieter advantages a well-run business holds over its competitors.
