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Bollywood actor-director Farhan Akhtar proudly displays an Intex smartphone in a commercial for the brand that runs every few minutes on national television. The Delhi-based company, for the past one year, has been raising its pitch through advertising. It is just one of the handset makers which marks the fourth wave of mobile phone manufacturers and their advertising blitzkrieg, say experts.
Since coming on board as the brand ambassador of Intex last May, Khan has featured in three very visible ad campaigns by the company. The 40-year-old actor, who also has a production house,
Excel Entertainment, is expected to feature in more adverts by the handset maker in the second half of the current year, coinciding with the festive season, says Keshav Bansal, director, marketing, Intex Technologies.
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Incidentally, Intex is not the only handset maker to be launching an ad offensive in recent months. Brands such as Gionee, Lava and iBall are all making their presence felt on mass media, including TV. Experts call it the fourth wave of handset advertising, which is not being led by the big handset manufacturers, but smaller brands. Typically, these are companies attempting to find their own niche in a very crowded market.
Intex's marketing budget has jumped from Rs 80-90 crore last year to Rs 160-170 crore now. Gionee has trebled its marketing spends to about Rs 125 crore this year from Rs 35 crore last financial year. Lava, which is also the owner of Xolo has more than doubled its marketing spends to Rs 280-290 crore this financial year, according to persons in the know.
India is among the world's fastest-growing handset markets with 250 million units, according to research firm Gartner. This metric is expected to touch 326 million units by 2016, the firm says.
Of this, the smartphone market, which is 60-65 million, is expected to more than double in that time.
Clearly, smaller brands are keen to partake of this growth. Marketing and brand-building, says Bansal, are intended to help his company push up sales. "After going aggressive with marketing, Intex's per month sale of handsets rose three times to 1 million units (from 300,000 units earlier)," Bansal claims.
The advertising spends also help differentiate one product from another. The most common route being taken by the players is to highlight specific features that may not be there in rivals' products.
It might be the case of incessant one-upmanship, but in a category where products get jaded every few months, there is no other choice, reason experts. "It is not so much the product that brings great value or differentiation, but it is really brand-building that is the key differentiator. There is a latent realisation among these marketers that that will help them stand out," says Harish Bijoor, CEO, Harish Bijoor Consults.
Rohit Gupta, president, MSM, which owns the TV broadcast rights to properties such as the Indian Premier League (IPL), says that handset manufacturers have to create mass impact to be able to generate the buzz around them. "For instance, Karbonn and Micromax were smart enough to see the potential that IPL presented in reaching out to a mass audience," he says.
Budgets of the number two (Micromax) and three (Karbonn) handset brands are estimated to be over Rs 300 crore this financial year. Both Karbonn and Micromax became popular after their association with IPL. Karbonn has been IPL's presenting sponsor for the last five years, while Micromax has been a regular spot-buyer during the tournament that runs in the April-May period.
The new crop of handset manufacturers are taking a leaf out of the marketing manual of these established brands to consolidate their position.
Take Chinese handset maker Gionee, for instance. The company entered the Indian market last year and began advertising during the festive season in the second half of 2013. Says Arvind Vohra, India head, Gionee, "There were a few things we needed to do. There was a tendency to mispronounce our name. At the same time, we needed to reinforce our presence in the Indian marketplace. And above all, send out the message that we were not a cheap product."
So, Gionee took up key sponsorships of the STAR Guild Awards (film awards by the Film & Television Producers Guild of India) and STAR GIMA (Global Indian Music Academy) Awards in January this year. It followed it up with sponsorships of reality show Khatron Ke Khiladi on Colors in March and the dance reality show Jhalak Dikhlaja in June.
Vohra says that associations such as these are expected to be part of his strategy to create high impact and will continue alongside regular advertising. Like Gionee, brands such as Xolo from Lava too has been taking up key sponsorships. It was a sponsor during the just-concluded FIFA World Cup.
Says Gupta of MSM, "Lava took a big position on FIFA since that had the audience it wanted to reach and was present during the length of the tournament. The association was spot-on, helping it create brand awareness."
According to media buyers, Lava spent Rs 15 crore for its associate sponsorship of the football World Cup, a fraction of the money that usually is required for such sponsorships of cricketing tournaments.
Bansal of Intex believes that credible brand-building also ensures that local players do not get overshadowed by the big boys such as Samsung, Apple and Nokia. Afterall, the ownership of the latter is considered a matter of prestige owing to their pedigree and brand equity. Apple and Samsung continue to figure among top global brands, across sectors, according to most international brand valuation studies. The smaller handset makers who do not have a global appeal, then need to push even harder on when they get down to mainstream advertising.
