Location, Location, name

NEW DELHI: India may have set up Asia’s first export processing zone at Kandla, Gujarat in 1965, but that came a cropper. Multiplicity of controls and clearances, absence of world-class infrastructure and an unstable fiscal regime converged to ensure a medieval rather than modern touch to India’s export processing hubs.

So, in 2000, the special economic zones (SEZ) policy attempted to rectify all that by granting permission to public and private players to develop SEZs, to catalyse exports. Notwithstanding the controversies that have dogged SEZs for reasons of land acquisition and rehabilitation, the developers have quietly begun working on branding their would-be industrial hubs with an aim of creating differentiation.

Apart from providing the ‘world-class infrastructure’ tag, the 142-odd notified SEZ developers are using magnets such as international road shows and conventions to rope in tenants or anchors. And since these developers have deep pockets, they’re resorting to all forms of communication to create resonance for their brand new SEZs.

It is estimated that once functional, the 142 notified SEZs alone will add up to an export turnover of over Rs 2-lakh crore. As per current estimates, the ongoing and proposed SEZ projects will occupy close to 10 lakh acres in various parts of the country.

Today, virtually every free zone in the Middle East and Singapore advertises through road shows. “But there’s an active government push in these zones, which is expected to be limited in India, thus calling for that much more push by developers,” claims Jayesh Desai, director, transaction and advisory services, Ernst & Young India. Reliance Industries and DLF are developing some of the most ambitious SEZ projects. RIL has two 25,000-acre projects, one each in Navi Mumbai and Jhajjar, and DLF has a 20,000-acre project in Gurgaon.

Branding of SEZs in India is centred around the availability of infrastructure, both within and outside the property, and the ease of doing business in the SEZ. “And since tax incentives won’t vary widely from one SEZ to another, the facilities provided by the developer will set the tone for marketing and branding of that particular SEZ,” Mr Desai added.

For one, Delhi-based ad agency K Factor is involved in churning out multi-level communication for a clutch of SEZ projects, including heavyweight developers like Unitech and Omaxe. “We should see more and more SEZs advertise in six to eight months, by when I reckon the slowdown in real estate will start to wane,” says Shivjeet Kullar, founder creative director of K Factor.

He further remarks that most SEZs are located in places “which are not very well-known”. So, the branding thrust would go in developing a USP for such lesser-known places as well as focusing on the core issue there, he observes. “The headline could scream world-class infrastructure, and the sub-text would highlight the worries in people’s minds,” he points out.

But didn’t problems around land acquisition give SEZs a bad name? What communication efforts are the SEZ developers taking to address this negative perception with farmers and policymakers? “There isn’t any negative perception with farmers or policymakers. For instance, for our Gurgaon SEZ, we have not taken a single acre of land from the state government, and have only bought land on a willing buyer-seller model. Problems were only created by certain vested interest groups,” says DLF group executive director Rajeev Talwar.

There’s also a sharp distinction in branding a single-product, sector-specific SEZ as against a multi-product zone. “Single-product SEZs would need lesser investment than a multi-product SEZ. Moreover, multi-product SEZs would need to build social infrastructure and draw anchor tenants just like in a mall, all of which could peg the cost of branding much higher,” says Vivek Mehra, executive director, PwC.

So, for multi-product SEZs, it will not be about one single strategy. “Since you are catering to companies across various sectors, choice of an anchor tenant for the project has to be critical. Then, one major company from all major sectors could be approached,” says Kamal Taneja, MD, TDI. The company has a project on the Kundli-Manesar-Palwal (KMP) expressway in Haryana.

The Delhi-based real estate firm Parsvnath Developers (PDL) is clearly getting the first-mover advantage. The company already has two notified projects. “We are communicating this message to our target clients that while most projects will have much longer completion schedule, our projects are already notified and will be complete in three to four years.

We are also marketing our projects on the issue of green buildings,” says PDL chairman Pradeep Jain. The company has also hired consultants to deliberate on various areas of branding. “The first mandate that they are working on is names for the projects,” says Mr Jain.

So, what’s in a name? Mr Kullar claims to have spent more than three weeks in hunting down a nomenclature for a Bhiwandi-based SEZ client. “Ultimately, we chose Silicon City since it was an IT-based SEZ,” he says. “It’s all about the imagery and if there’s a hill nearby, one could also use aspects of geography and give it a fancy name like California Hill,” he adds. Vinayak Chatterjee, chairman of Feedback Ventures, seconds Mr Kullar’s opinion and adds that branding SEZs will be an extension of the promoter-led branding of large residential and commercial complexes.

“Exotic names will crop up instead of drab industrial complexes, and since branding is an important part of any product, SEZs are also like any other product and need strong communication tools,” he observes. In the case of single-product SEZs – 135 out of total 142 notified – where the target audience is clearly defined, brand names take a specific turn. For instance, Orient Craft, which is developing an apparel SEZ in Gurgaon, is giving final touches to a massive ad campaign. Though the company is tightlipped about the investment estimates for the project, it is learnt to be huge.

“It’s a unique branding that we are working on, starting from the name itself. We our calling our SEZ Fashion Village to give the message that we will be a one-stop solution for the entire fashion industry,” says Sudhir Dhingra, chairman of Orient Craft. The company has also tied up with the Fashion Design Council of India (FDCI).