Pritha Dasgupta
Apr 08, 2013

‘Marketing will take over IT and CMOs will make bigger investment than CIOs’

The fourth BMA Marketing Convention 20:20 focused on the theme ‘The impact of technology in reshaping the practice of marketing’, and was hosted in Mumbai on 5 April.

‘Marketing will take over IT and CMOs will make bigger investment than CIOs’

A key take out from BMA Marketing Convention 20:20 was that evolution of technology is changing the way marketers design communications – and that social media and digital are just the tip of the iceberg.

The fourth edition of the Convention hosted in Mumbai on 5 April rounded up marketers from sectors such as cable and wires, mobile handset manufacturing, retail, confectionery and personal care to talk about technological changes and attendant challenges.

“Going forward, marketing will take over IT and CMOs will make bigger investment than CIOs”, said R Ramakrishnan, vice chairman, JMD and group CEO at Polycab Group. He added that 64 per cent marketers in the US feel underinvested in marketing technology and 60 per cent feel marketing technology is crucial to deliver business objectives. “(It’s about) How data can be converted into information and then distilled. So data mining will play a major role,” he explained.

Social media is transforming everything and digital will create the next phase of evolution with mobile being a big business, he said. “In the next two decades, technology will be the biggest leveller ensuring social equity. Sensitivity to the customer with the help of technology will play a great role,” added Ramakrishnan.

Nitin Bhagwat, CEO, Cogito Consulting; CEO, Interface Communications and ED, Draftfcb-Ulka Advertising, pointed out to a recent global study that showed that teenagers are not rebellious anymore. “Today they spend a lot of time on social media. Connectivity has improved and that has tremendously impacted the way teenagers behave,” he added.

Telematics, or the integrated use of telecommunications and informatics, will revolutionise marketing, observed Bhagwat. “When installed in a car, it can help marketers understand driving habits of the end consumer.” Quoting the example of multinational retailer TESCO, he referred to apps that allow consumers to track their entire purchase history.

Before signing off Bhagwat touched upon the pace of information transfer with the example of the recent Ford Figo scam ad. He said, “The ad was irrelevant for the client. However, the entire incident blew out of proportion because these days information moves much faster. And all these are leading to the power of choice.”

The unfolding mobile revolution: LBS, apps, videos

There’s more to use of technology in marketing than ads and content going viral on social media, or likes and the like. It is about CEOs and CMOs making heavy investments in purchasing marketing tools and launching CRM activities, observed speakers.

P Balaji, MD, Nokia Mobile, India, spoke on how technological changes can revolutionise mobile advertisement market. Currently the size of the global mobile market stands at $11.6 billion and it is witnessing a whopping 87 per cent growth. “It is relatively new in India. The size of the Indian mobile advertisement market is of about Rs 200 crore growing at about 40 per cent. And it is just the tip of the iceberg,” said Balaji.

Citing data that showed mobile ads to perform four to five times better than online, he said mobile coupons have 10 times more redemption rates. “Currently, the Indian handset user base exhibits 600 million mobile phones, 240 million data enabled handsets, 50 million smart phones and 2 million tablets. There is a huge explosion in apps download and within Nokia store it has gone up by 76 per cent,” said Balaji.

He said in the past, mobile ads were about SMS, banner ads and searches. With the growth in smart phones, the new mobile advertisement formats are location based services (LBS), applications and videos, surmised Balaji.

Ajit Joshi, MD, CEO, Infinity Retail (Croma), began his presentation with the case of a TESCO Korea innovation. The idea was to increase sales without increasing the number of stores. The supermarket created virtual stores on railway platforms, where customers could use their smart phones to shop and place orders. Upon receiving the orders the supermarket then delivered it to their doorstep. “We Indian have failed to use (tools like) this,” said Joshi. Moreover, he said, India doesn’t even have the right infrastructure to execute such innovations and create such premium experience for consumers.

“Croma started in 2006. Currently we have registered Rs 2500 crore turnover. And we did not achieve it by selling washing machines and refrigerators. We have achieved this by selling technology,” said Joshi.

According to him, the day has come when smart phones and tablets will soon replace laptops. Talking about the challenges, he said the shelf life of new products is really low. He gave the example of how plasma TV was replaced by LCDs with a year which was again replaced by LED within a year and a half. So much so that many prominent players have stopped manufacturing LCD television sets, he reasoned. Joshi cited the case of Samsung, which has patented a technology where one television set allows two people to watch two separate channels at the same time with two different audio outputs. “If such a product is launched, then the number of units we sell with take a hit. So technological advancement is creating both opportunity and challenges for retailers,” he explained.

Simulation is the new test market

Anil Vishwanathan, AVP - marketing, Cadbury, began by saying that in the present day a brand could easily lose the edge and the leadership position thanks to technology. “It has become extremely easy to decode a brand’s strengths and weaknesses,” he explained.

Noting that transactions and shopping behaviour are changing with the advent of technology, he voiced the need to reinvent oneself, adding that the competitive landscape had intensified over the last decade. He gave the example of the recent campaign done by café chain Café Coffee Day, terming it a great example of use of digital to invigorate the category.

He said the change in change in consumer behaviour extended across awareness, attitude, behaviour and loyalty. “People are not bound by where they stay but by the way they are using technology. How they are receiving information and data and how they are processing it,” said Vishwanathan.

Talking about the new marketing mix, he said, “Simulation is the new test market. There is an increase in multivariate function with the way we deploy and spend on different media. Gone are the days when we could simply put out a television ad and generate business.”

He also said innovation processes have changed and co-creation has become the order of the day. Summing up, he said, shopper marketing with its 5-S funnel is also helping marketers make customers ‘see, spot, scan, show interest and select’ their product.

It is popularly believed the personal care is a category than cannot use the digital medium effectively to initiate consumer connect. Rakshit Hargave, general manager, MD, Nivea through his presentation tried to prove otherwise. He spoke about a series of case studies that Nivea launched on the digital platform and the experience the brand gained from it. “Traditional path of purchase is simplistic. The usual loop is changing. The digital revolution has democratised information, making brand choices more researched, informed and shared experiences for consumers,” said Hargave.

“It has also enabled marketers to have a meaningful conversation for the brand, with like-minded people. Word-of-mouth and getting referrals remain crucial. It supersedes any kind of marketing,” he surmised.

Source:
Campaign India