Digital advertising is fast gaining currency in India as an element of the marketing mix. Suvi Dogra and Sapna Agarwal spoke to Sean Finnegan, President (worldwide) and Chief Digital Officer, Starcom MediaVest Group, and Pushkar Sane, Chief Digital Officer - North and South Asia, to understand if the digital medium gives more bang for the buck. Edited excerpts:
You have been brought on board as the chief digital officer. What does it imply?
Finnegan: Digital media billings account for close to 10 per cent of our overall media billings at $2 billion, globally. As the overall market has contracted, so has the digital market, but it is still a growth market. However, we don’t have a chief television or chief radio officer. Hence, with time we will see this function also going defunct, as technology becomes a part of everything we do.
How important is India as a market for Starcom MediaVest in terms of digital advertising?
Finnegan: There are two forces that are driving us -- emerging markets and digital. The two markets together provide a very strong potential. India is one of our focus areas among our emerging markets such as China, Brazil, the Middle East and Russia. At present, only 40 million of India’s 1.1 billion people have access to internet (about 3.5 per cent) and internet penetration has grown 700 per cent since year 2000.
The potential is enormous. Even if the country reaches 50 per cent penetration, it will account for more users than the entire population of the US. We hope to grow and evolve the digital arena here by including learnings from mature markets. India’s digital reach will only continue to grow.
Likewise, the media spends in emerging markets is 2-3 per cent of the overall media spends. In the advanced markets, these spends are anything between 10-40 per cent. With the growth of the internet, we see these spends levelling with their Western counterparts in the next 12-18 months.
Sane: We will scale up our team in India this year and this will involve more than tripling our team size, as well as bringing in people with international experience to grow our business.
How does digital advertising compare with traditional advertising, especially in these times?
Finnegan: Advertising budgets have shrunk and digital marketing can help us find the right balance. Digital alone cannot be the solution. Smaller the ad budget, bigger the need to strike the right marketing mix.
It doesn’t mean shifting the entire spectrum to digital as it is a more cost-effective approach. Web advertising allocations have changed over the years. Web advertising itself is 15 years old in the mature markets. It is the emerging markets that will benefit from the learnings of the mature markets.
Sane: Agencies don’t need to overanalyse things but put into perspective factors such as time spent online, the category to be marketed, etc., to arrive at a solution that works.
What digital tools would one need to make this tick?
Finnegan: Digital tools like blogs, video, podcasts, interactive TV and social networking allow a brand to be a participant in the conversation and, at times, guide it. They allow the consumer’s voice to be heard, and allow the brand to respond in real time. Brands need to use a collaborative approach and reach out to social networks and blogs in a meaningful and fully transparent way. With these tools acceleration of the digital medium will only increase.
Sane: The need is to create an experience for the consumer which is both measurable and acceptable. Digital has ensured that from a one-way communication set-up, we are moving towards a two-way dialogue
India has a large rural population. Will digital advertising make sense to them?
Sane: Mobile as a medium can become the right solution to target the rural audience even as it is yet small, but the potential is immense. Besides there is an increasing phenomenon of low-cost laptops, low-cost hardware, among others, which are helping to close the gap between the total population and innovation.
Finnegan: In mature markets you can see high penetration of smart phones and acceptability of rich format ads on phones, but not so much for text ads.
