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Experts state that the money saved from travel during the year is being used to make purchases in other categories, such as consumer durables.
Aug 02, 2021 04:02:00 AM | Article | Raahil Chopra Share -
In a year in which ‘essentials’ was a key word, brands that didn’t fit that description and which were considered to be ‘discretionary’, gained in Campaign Asia-Pacific's list of the top 100 brands in India, which is derived from the exclusive Asia's Top 1000 Brands research.
Five of the top 10 brands in the country come from the consumer durables category, which continues to be dominated by Samsung. LG gained a spot to replace Nestle as the second most trusted brand, with Sony (third), Apple (sixth) and Philips (eighth) also being a part of the top 10.
Nestle and Amul—two brands that would be classified as having ‘essential’ products—saw a dip in the rankings. Nestle fell three spots to number five and the latter fell seven spots (from its fifth position in 2020) to 12th in 2021.
According to industry experts, this was down to the nature of the year.
Narayan Devanathan, CEO of Dentsu Solutions India and head of strategy and consulting for Dentsu Creative APAC, explains, “Luxury cars had one of their best years. And while not all durables’ consumers may have been luxury car consumers, there’s a common link. Those with disposable income had higher savings and lesser average monthly spending, thanks to a cut down on commuting, travel, eating out and other entertainment expenses. That left consumers with more money for discretionary spending. And again, human beings being the irrational creatures that we are, they turned to things that alleviated the pain of constrained lives with purchases that made daily lives easier, more joyful.”
Lloyd Mathias, business strategist and former Asia marketing head at HP, added that because of people looking at communication tools to stay in touch with friends and family, or even work, it was the consumer durables category that saw a surge.
“Communication has been critical, and whether it's a mobile handset or a laptop, it’s been in high demand," he said. "Categories like laptops have seen a huge surge in growth in the last 18 months. Households were buying laptops for their children to attend school and there was a time when there were shortages too. Companies too had to buy laptops for people lower down in the hierarchy."
On the dip in brand rankings for Nestle and Amul, Mathias added, “The pandemic has altered retail behaviour. For the last 16 to 17 months many people have stayed away from visiting grocery stores or supermarkets and switched to online ordering, so the exposure and selection of brands one would do at a retail level has diminished.”
Samsung topping the brand rankings again this year didn’t surprise any of the experts.
S Subramanyeswar, chief strategy officer for APAC at MullenLowe Group, said the brand helped contribute to a better global society, which helped cement its space as the top brand.
“Samsung went beyond the humble hype that many brands displayed towards consumers, and donated smartphones to patients in quarantine to help them keep in touch with their families and friends, as well as air purifiers and other appliances to hospitals and quarantine centres,” said Subramanyeswar.
He added that the brand also donated tablets to educational institutions so that children could continue learning outside of the classroom.
Mathias added, “Given the fact that Samsung has the scale and has been dominant in the space with their range of consumer durables, the brand has cemented their space in people's minds.”
Growth of digital-first brands
A glance at the top 20 reveals that digital-first brands have grown in the brand rankings. Ola, a ride-sharing app, has gained three places to reach number four. Ola's popularity in India also drove it from 234 to 87 on the overall APAC Top 1000 list, making it one of the top rising brands. Amazon has also gained three spots on the India top 100, to reach number 10, and food delivery apps Swiggy and Zomato have entered the top 20 at number 17 and 18, respectively. Uber has also gained eight spots to reach number 19.
Mathias isn’t surprised by these gains.
“People are shopping online and are ordering food online," he said. "People are transporting themselves using Ola and Uber. These are digital-first brands and have not been affected like traditional FMCG brands have during the lockdowns. So, the preferences for these brands will have increased.”
On the rise of Swiggy and Zomato in the top 20, Devanathan added, “While the pandemic may have accelerated their rise, I would not attribute their presence in the top 20 only to that, or to luck. These are two brands that have done many things right—they’re purpose-driven, they’re digital-first, they’re innovative, and they serve one of the most primal needs while elevating them to the status of desire. They are no mere food delivery companies, they’re hunger saviours, boredom relievers, and relief for WFH multi-taskers.”
Facebook grows, Twitter drops
Another trend the India rankings reveal is that Instagram (largest gainer in the social-media space with a 29-spot increase) and Facebook, have grown in brand preference. YouTube has also seen a growth in the ranking and WhatsApp has retained its position, but Twitter has suffered a drop in rankings with a ten-spot decrease to 100.
Last year also saw Facebook and Google invest in Indian company Reliance, but experts believe that isn’t the reason for the change in rankings.
Devanathan attributes the drop in Twitter’s rankings to them being late to enter the video space. He says that the surge for Instagram is a result of TikTok being banned in India.
He said, “I would say the coincidental timing of TikTok’s ban in India helped Instagram, Facebook and YouTube. Twitter’s woes are not in the least because of their being at the cusp of the public, the personal and the political, but they’ve also (a) been late to the game with vernacular and video and (b) have not had convincing, scaled products for younger audiences.”
While Mathias was surprised to learn about Twitter’s fall in rankings, he wasn’t surprised about Instagram’s growth and he attributed the change in rankings to the difference in the audience each of the mediums attracts.
“Instagram has become the primary medium for millennials and Gen Z's to consume content, and it is bound to increase in brand preference. About Twitter's drop, it could be because it plays in the smaller niche of the larger social-media ecosystem. It's in that 400 million consumer range while Facebook is at 3 billion-plus. Further, only 3% to 5% of the users are creating content daily for Twitter. The others are silent followers. Whereas on Instagram and Facebook, the users are creators,” said Mathias.