 "The mobile phone will soon emerge as a key advertising tool: Srikant Sastri")
The smartphone explosion will force brands and their agencies to find a way to help clients advertise on this platform, Srikant Sastri tells Abhilasha Ojha
As tablet and smartphone penetration increases, and bigger bandwidth lets consumers be constantly connected through Wi-Fi or 4G networks, video consumption and app consumption are also going to increase. What does this mean for mobile advertising?
Yes, these are positive developments that will lead to higher video and app consumption. I am personally very optimisitic about the growth of mobile advertising despite the fact that it hasn't witnessed the sort of boom till now. Better screens, explosion of smart phones in the market, phablets and tablets will be good news for mobile advertising. After all, despite a huge mobile user base, these are the constraints that have held back the growth of mobile as a marketing medium. Remove these constraints, and I would expect rapid, and explosive growth. We are just 18-24 months away from getting there.
What are some of the challenges surrounding mobile advertising and how can these be overcome?
In what ways does device/screen have an impact on the effectiveness of video advertising?
Video is arguably the most powerful form of digital advertising given that the audio-visual medium scores over mere pictures ('display') or text ('search'). While screen size matters - larger the better - high-quality screen displays, 'retina' on iPad for instance, mean that user experience on tablets, most certainly, and smartphones is pretty good.
However, what queers the pitch is internet bandwidth. Video on mobile and tablets gets constrained by access to, and quality of 3G. So, more than the screen, it is the bandwidth that constrains video quality.
What do brands want from the mobile - run direct response campaigns or brand campaigns ?
Brands have generally been slow to use mobile advertising. This is partly a result of slow adoption in general, and partly due to the challenges of mobile as a medium. Also, the requirements of one sector may be totally different from another. So, while performance-oriented categories like real estate, education and financial services would use mobile advertising as direct response, other sectors like auto and telecom may use it differently for brand building.
Globally, booming demand for smartphones and tablets has shifted the advertising industry's focus to digital. But are we really innovative in terms of digital advertising?
I agree that companies today tend to have a rather 'superficial' engagement with audiences on the digital media. There is a huge potential to use it more effectively. Clearly, advertising on a popular social networking site such as Facebook, for instance, has to move beyond merely creating a webpage that can be 'liked' by several consumers. What are companies creating beyond 'like'? Also, a formidable platform like Facebook cannot be used in isolation. Marketers need to understand that they have to be part of a larger gameplan, a more diverse strategy. While brands need to definitely have an online presence, the existence cannot be 'static'.
However, in the absence of a common currency, pitching digital advertising's success gets tough when compared to traditional television or print media. To be specific, when we talk television, we talk gross rating points or GRPs; when we talk newspaper advertising, we know that the emphasis is on reach. What does it mean for marketers when a million people 'like' a Facebook page of a particular brand? How do we compare this with traditional media? These are some of the questions before marketers today.
Also, the digital media platform is fairly nascent in India. So, even as the global counterparts of select companies are doing much more in terms of digital advertising innovation, in India, we still do things on a very ad-hoc basis. A client would say, 'I have Rs 5 lakh left from my marketing budget. How can I use it on the digital media?' This attitude cannot create innovation.
Research firm eMarketer recently reported that global digital advertising spending topped the $100-billion mark in 2012. Given the general attitude towards digital media, can it ever outgrow print and television?
I have no doubt about the success of advertising on the digital medium. Companies cannot shy away from it anymore. As a brand you cannot survive if you do not believe in the power of advertising on the digital medium. Don't forget that in the last five-six years alone print has seen a tremendous decline. In a market like the US, between 2006 and 2012 we have seen many newspapers and magazines closing down.
In India, we are only now beginning to see the effects of the decline in print. But sometimes, newspaper owners and publishers here tend to be complacent, not believing that a transition from print to digital is of utmost significance.
Very recently, at a management institute in a tier-II city, where I was joined on a panel discussion by top marketing people of Nestle and Pepsi, I did a spot poll among the young students and asked how many of them read the newspapers every day? Only five hands went up in that jam-packed room. Next, I asked how many of them were spending more time on the internet compared to television; 75 per cent were. So, clearly, the emphasis will be on digital and both marketing and advertising will have to be done on this platform. In fact, this is where our expertise as a company will come in.
In the Western markets, we are already helping some of the oldest newspapers and publications to make the transition to the digital platform because the advertising will go there. In India, we are bringing experts who can show the way to Indian newspapers and magazines and help them in the transition from the old world to the new. Trust me, the floodgates will open soon in digital media.
Various studies show that the digital media is growing at a frenetic pace. What are the challenges such growth has thrown up as far as advertising agencies are concerned?
There is huge manpower crunch given the way digital media is growing. In fact, it will be a major challenge for us. Traditional agencies have to be quick in offering solutions, in fact, pluck young talent straight out of colleges and work on dedicated programmes and solutions to train them.
The digital advertising market in India is barely 5 per cent of the overall advertising pie, compared to about 30 per cent globally. The good news is it is growing at 20 per cent annually. Which are the sectors that have embraced digital strongly?
Digital is one of the fastest growing segment of the Indian advertising pie. Publicis, for instance, witnessed 98 per cent growth in the digital space last year. Finance services, travel and auto sectors are already increasing spends every year. In the next 24 months, FMCG companies will increase spends to 10 per cent while durables and telecom sectors will see growth from 10 per cent to 25 per cent.
Building a digital culture in India
As tablet and smartphone penetration increases, and bigger bandwidth lets consumers be constantly connected through Wi-Fi or 4G networks, video consumption and app consumption are also going to increase. What does this mean for mobile advertising?
Yes, these are positive developments that will lead to higher video and app consumption. I am personally very optimisitic about the growth of mobile advertising despite the fact that it hasn't witnessed the sort of boom till now. Better screens, explosion of smart phones in the market, phablets and tablets will be good news for mobile advertising. After all, despite a huge mobile user base, these are the constraints that have held back the growth of mobile as a marketing medium. Remove these constraints, and I would expect rapid, and explosive growth. We are just 18-24 months away from getting there.
What are some of the challenges surrounding mobile advertising and how can these be overcome?
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The size of the digital market is too small at the moment but like I said, it is growing. Mobile advertising may not have grown tremendously but having said that, it is really just a matter of time. The smartphone explosion will force brands and their agencies to find a way to help clients advertise on this platform too. The focus for agencies will have to be on significant offerings for the digital media platforms, with emphasis on analytics, content and context. Give it some time, it will be an important advertising and marketing tool in the near future.
In what ways does device/screen have an impact on the effectiveness of video advertising?
Video is arguably the most powerful form of digital advertising given that the audio-visual medium scores over mere pictures ('display') or text ('search'). While screen size matters - larger the better - high-quality screen displays, 'retina' on iPad for instance, mean that user experience on tablets, most certainly, and smartphones is pretty good.
However, what queers the pitch is internet bandwidth. Video on mobile and tablets gets constrained by access to, and quality of 3G. So, more than the screen, it is the bandwidth that constrains video quality.
What do brands want from the mobile - run direct response campaigns or brand campaigns ?
Brands have generally been slow to use mobile advertising. This is partly a result of slow adoption in general, and partly due to the challenges of mobile as a medium. Also, the requirements of one sector may be totally different from another. So, while performance-oriented categories like real estate, education and financial services would use mobile advertising as direct response, other sectors like auto and telecom may use it differently for brand building.
Globally, booming demand for smartphones and tablets has shifted the advertising industry's focus to digital. But are we really innovative in terms of digital advertising?
I agree that companies today tend to have a rather 'superficial' engagement with audiences on the digital media. There is a huge potential to use it more effectively. Clearly, advertising on a popular social networking site such as Facebook, for instance, has to move beyond merely creating a webpage that can be 'liked' by several consumers. What are companies creating beyond 'like'? Also, a formidable platform like Facebook cannot be used in isolation. Marketers need to understand that they have to be part of a larger gameplan, a more diverse strategy. While brands need to definitely have an online presence, the existence cannot be 'static'.
However, in the absence of a common currency, pitching digital advertising's success gets tough when compared to traditional television or print media. To be specific, when we talk television, we talk gross rating points or GRPs; when we talk newspaper advertising, we know that the emphasis is on reach. What does it mean for marketers when a million people 'like' a Facebook page of a particular brand? How do we compare this with traditional media? These are some of the questions before marketers today.
Also, the digital media platform is fairly nascent in India. So, even as the global counterparts of select companies are doing much more in terms of digital advertising innovation, in India, we still do things on a very ad-hoc basis. A client would say, 'I have Rs 5 lakh left from my marketing budget. How can I use it on the digital media?' This attitude cannot create innovation.
Research firm eMarketer recently reported that global digital advertising spending topped the $100-billion mark in 2012. Given the general attitude towards digital media, can it ever outgrow print and television?
I have no doubt about the success of advertising on the digital medium. Companies cannot shy away from it anymore. As a brand you cannot survive if you do not believe in the power of advertising on the digital medium. Don't forget that in the last five-six years alone print has seen a tremendous decline. In a market like the US, between 2006 and 2012 we have seen many newspapers and magazines closing down.
In India, we are only now beginning to see the effects of the decline in print. But sometimes, newspaper owners and publishers here tend to be complacent, not believing that a transition from print to digital is of utmost significance.
Very recently, at a management institute in a tier-II city, where I was joined on a panel discussion by top marketing people of Nestle and Pepsi, I did a spot poll among the young students and asked how many of them read the newspapers every day? Only five hands went up in that jam-packed room. Next, I asked how many of them were spending more time on the internet compared to television; 75 per cent were. So, clearly, the emphasis will be on digital and both marketing and advertising will have to be done on this platform. In fact, this is where our expertise as a company will come in.
In the Western markets, we are already helping some of the oldest newspapers and publications to make the transition to the digital platform because the advertising will go there. In India, we are bringing experts who can show the way to Indian newspapers and magazines and help them in the transition from the old world to the new. Trust me, the floodgates will open soon in digital media.
Various studies show that the digital media is growing at a frenetic pace. What are the challenges such growth has thrown up as far as advertising agencies are concerned?
There is huge manpower crunch given the way digital media is growing. In fact, it will be a major challenge for us. Traditional agencies have to be quick in offering solutions, in fact, pluck young talent straight out of colleges and work on dedicated programmes and solutions to train them.
The digital advertising market in India is barely 5 per cent of the overall advertising pie, compared to about 30 per cent globally. The good news is it is growing at 20 per cent annually. Which are the sectors that have embraced digital strongly?
Digital is one of the fastest growing segment of the Indian advertising pie. Publicis, for instance, witnessed 98 per cent growth in the digital space last year. Finance services, travel and auto sectors are already increasing spends every year. In the next 24 months, FMCG companies will increase spends to 10 per cent while durables and telecom sectors will see growth from 10 per cent to 25 per cent.
Building a digital culture in India
- Srikant Sastri, India chairperson for VivaKi, an entity created by Publicis Groupe for leadership in the digital era, oversees leading media, digital and marketing services firms, including Starcom MediaVest, Zenith Optimedia, Digitas, and Solutions Integrated
- He has successfully established Vivaki as a dominant player in the digital advertising space in India. In 2012, digital accounted for 25 per cent of the overall revenues for the company. By the year-end, it will account for a third of revenues
- Sastri built and exited two innovative companies; one in the marketing services space, Solutions Integrated, which was acquired by the Publicis Groupe, and the second one, Team4U, in the outsourced staffing space, acquired by Randstad. Both businesses achieved scale (2,000 employees,and 15,000 employees respectively) and market leadership before being acquired
- As a leading marketing practitioner, Sastri has been on the jury of Cannes Lions and Dubai Lynx. He has also been a speaker at the prestigious TED Talk, a global set of conferences concentrating on ideas that can shape the future of the world
- Sastri helped in the acquisition of Resultrix, the leading digital agency, which is now a part of VivaKi
- He has been involved in drawing attention to development issues through two initiatives: growth For All and Action For India