2016 NOT QUITE THE HIGH OF 2015

BY IMPACT Staff

This festive season is markedly less buoyant compared to 2015. Slowdown in growth in the first half of the year rubs off on brands, makes them cautious about putting in a lot of money on festive campaigns

By Samarpita Banerjee

(With inputs from Allan Dsouza, Neeta Nair and Simran Sabherwal)

For brands, the buoyant atmosphere of 2015 is missing this festive season. The festival period in India – typically September to November - is the time when the entire country is in a celebratory mood, and brands do all in their might to give people the right stimulus to festive buying, with massive advertising, enticing offers, attractive discounts and irresistible deals. However, this year, the story seems to be playing out a little differently, with festive advertising being much less buoyant. While e-commerce still seems to be leading the race, it is only the big three - Amazon, Flipkart and Snapdeal - going all out with their advertising, while the rest are not as visible as before. Despite a sprinkling of ads from two-wheeler brands, even leading automobile brands seem to be lying low this year.

REVISED GROWTH ESTIMATES MAKE BRANDS CAUTIOUS

The year 2015 marked the rise of e-commerce as a winner in the festive marketing race with the big and the not-so-big players spending big during the festive months. The result - our TVs, Radio sets, newspapers and mobiles got inundated with brand communication trying to veer the consumer’s attention towards them. This year, the slow growth rate in the first half of the year that prompted leading media agencies to revise their growth figures for the year could be one of the reasons for a relatively quiet festive season, feel industry experts. While the Pitch Madison Advertising report revised its growth estimate from 16.8% to 13.2%, GroupM said that the slowdown of growth in the first eight months in 2016 could lead to a new growth figure of 13-14% as opposed to the earlier projection of 15.5% in its TYNY report. Meanwhile, IPG Mediabrands revised its growth rate prediction from 18.4% to 16.2%.

OVERALL spends may NOT BE AFFECTED, say media planners

Most media planners we talked to feel that there hasn’t been a lot of difference in the overall amount being spent by brands. Ashish Bhasin, CEO South Asia, Dentsu Aegis Network, says that the overall spending of the industry will go up by about 10-12%: “We expect around Rs 20,000 crore to be spent during the months of October, November and December which is a 10-12% increase over last year’s spending. This season is very important because almost 40% of the entire year spends happen in this quarter. However, the exuberance that the season was supposed to bring with itself seems to be a little subdued this year. In terms of sector, Automobiles, FMCG and Telecom seem to be on the upswing.”

Pointing at one visible trend this year, Bhasin adds, “Last year, e-commerce had spent big. This year, most of the big players are spending a lot. But the number of players advertising actively seems to have gone down in comparison to the past and that is a trend that is expected, considering the way the e-commerce industry is going.”

As per media reports, Flipkart, Amazon and Snapdeal are said to have spent an estimated Rs 350-400 crore on marketing this year. Snapdeal, which went for a complete rebranding along with a new logo right before the festive season hit, is said to have spent around Rs 200 crore on various festive promotions. All three e-retailers, in a bid to outdo each other, had launched discount days, with all three reporting massive sales.

While we did see some active participation in the celebrations from e-commerce, one segment that is visibly lying low this year is Automobiles. Commenting on the possible reason behind this, Shashi Sinha, CEO, IPG Mediabrands India says, “This year, a few two-wheeler brands have come up with campaigns but advertising by Automobile brands has been slightly subdued. Usually, Auto brands link a few launches to festivals but this year that hasn’t happened. It’s a sensible decision on their part because there is so much clutter during this time of the year. I can’t say there has been a clear increase or decrease in spends. It’s just that people are taking individual category decisions. The monies are simply spread out more evenly.”

CRUNCHED FESTIVE SEASON, FEWER WEEKS OF ADVERTISING

Citing one reason for the lack of fireworks this year, Anita Nayyar, CEO, Havas Media Group, India and South Asia says, “The festivities this year have been lukewarm. One of the primary reasons might be that this year, the festive season is crunched. Normally, Diwali comes towards the middle of November, which gives you at least all of October to advertise. Following that, you also have half of November or at least 10 days in the month. This year, the time period is crunched because everything gets over on October 30, giving brands only the month of October for all campaigns.  If you noticed this year, until about the second week of October, there was nothing exciting happening. So, in effect, there are just two to three weeks of festive advertising, due to which the budgets go down.”

WHY SMALLER e-commerce PLAYERS ARE QUIET THIS YEAR

While Amazon, Flipkart and Snapdeal did come up with big advertising campaigns during their sale-days, many smaller e-commerce companies chose to spend the festivals silently. Commenting on why the smaller e-commerce players did not invest as much as they did last year, Sandeep Aggarwal, Founder & CEO, Droom says, “Last year, the five day sales by e-commerce companies produced Rs 1500-1800 crore in gross revenue for the industry. This year, my guess is, that amount will touch Rs 2,500 crore but a few things will play out differently. Last year, about six months before Diwali, a lot of companies had raised several hundred millions. This year, six months before Diwali, there are hardly two to three companies that have been able to raise any money. Secondly, investors have a very low tolerance for discounting by the e-commerce companies. Thirdly, a lot of companies have not as many cash resources as they had in the previous years. Also, in general, the growth rate for the e-commerce industry last year was between 80%-90% but right now, the industry is growing at the rate of 35%. These could be some of the primary reasons for e-commerce celebrating a quiet festive season this year.”

Despite that, Snapdeal cashed in on the festive season and went for a complete re-branding, even before other players had started launching their campaigns. Talking about the timing of their campaign, Kanika Kalra, Head, Marketing, Snapdeal, says, “Our re-branding was well-timed with the festive season, but it’s not really just about this festive season. We intend to stick with the new design and insight for the next five to 10 years. It is really an investment for the future. Our idea was, the first people who adopted e-commerce were really the early adopters, people who understood it and found it convenient. They found the process tempting. So we got the early adopters in. But the next step was really about building relevance with the other 50 million who may not find convenience to be the biggest deal in life.”

THERE’S ALSO A VISIBLE MOVE TO DIGITAL ADVERTISING...

Meanwhile, there has been a clear increase in brands opting for digital advertising. Says Bhasin, “One of the most visible trends is the growth of digital. It is clearly growing much faster than the other mediums. The growth rate of digital is around three times more than normal mediums, however, that’s not just during the festive season but the overall trend.” Agreeing with Bhasin, Nayyar adds, “I think we are improving our digital contribution to the overall pie. We are one of those agencies that is ahead of the curve on the digital bit. Going ahead, digital will change the way things are.”

Pointing at a visible trend in digital, Shavon Barua, Managing Partner, PHD India says that ‘search’ is quickly becoming the most effective way of shortening the path to purchase. Elaborating, Barua says, “Consumers today are not simply searching for products on the Google search bar. They are also turning to other platforms like Instagram and hence, the effectiveness of shoppable ad inventory.

A recent survey by Twitter also corroborates the fact that a lot of purchase decisions are being made on various social media platforms.”As per the Festival Diwali Study (conducted by Twitter and TNS Singapore, August 2016), 93% Twitter users in India have interacted with brands on Twitter. The figures also revealed that about 85% of Diwali shoppers on Twitter will shop online, which is a 16% increase compared to 2014 figures. Talking about the trend, Taranjeet Singh, Business Head, Twitter India says, “Social media buyers worldwide are turning to Twitter for a variety of things, whether it’s to stay on top of current trends, interacting with brands or discovering Diwali buys online. These social media activities often tend to influence the shopping behaviour of customers. Today, Twitter users conduct research, explore products, make a decision and eventually purchase products online. They then share feedback on their purchase on the platform. Twitter enables brands to reach out to their target audience in the right moment and with the right message. Diwali is a big cultural event that gives brands an opportunity to grasp the attention of shoppers who often turn to Twitter to discover Diwali buys and make informed decisions. Real-time audience insights on the platform have enabled brands to improve and change marketing activities depending on the response from the Twitter audience. Over the years, brands have moved from one-way advertising to driving two-way conversations and Twitter's conversational products have been very useful in this regard. Brands are also taking a more data-led approach to understanding consumer behaviour on the platform and using that to design campaigns.”

Meanwhile, another visible trend this year has been integrated campaigns. With brands like Snapdeal, eBay and Flipkart coming up with such campaigns, Indu Kannan, Associate Vice President, Kestone Integrated Marketing Services talks about the importance of the strategy. “Festivals are the time when marketers have to reach out to their audience in a limited time period for which they need a mix of channels to create the desired impact in sales. An integrated campaign takes one central idea and translates it across various platforms – Television, Radio, Print, Social Media, Outdoor, On-ground engagement etc. to create amplification and greater resonance and brand recall with the customer. Needless to say the central idea has to be powerful yet versatile to lend itself to multiple conversations across myriad media. A good integrated campaign will have one strong concept that connects with the audience and this concept then defines the mode, manner, tone and language of engagement with the customer through the entire lifecycle of the campaign. For the customer, every touch point inexorably connects with the previous one thereby creating a landslide effect and enviable recall,” explains Kannan.

SOME BRANDS STILL TRIED TO MAKE THE MOST OUT OF THE SEASON

Meanwhile, despite the festivities remaining low key, some brands did come up with exciting offers to make the best out of the season. Picking up from its last year’s campaign ‘Iss Diwali kuch badalke dekhiye’, Pepperfry came up with ads with the same tagline this year. Talking about how much revenue the festive season garners for them, Ambareesh Murty, Founder, Pepperfry.com says, “Over the last decade or so, the couple of weeks leading up to Diwali have become an important retail shopping ‘season’ for consumers. There is high degree of seasonality in the sales that we see in the furniture market: for example, H2:H1 sales is 2:1 and within H2, the Diwali shopping month garners almost a third of the sales. For us, Diwali is an important spending season and like every year we expect a lot of consumer interest this season.”

Like every year, Mondelez launched a new 360-degree festive campaign for Diwali, ‘Iss Diwali Khushiya Le Chalo’ for its Cadbury Celebrations Rich Dry Fruit Collection. “The ad created by Contract Advertising Mumbai shows grown up children gathering at their parents’ house for Diwali and features yesteryear’s actor Dalip Tahil,” says Prashant Peres, Director, Marketing (Chocolates), Mondelez India. “Though historically, we have conceptualized and marketed our campaigns around Diwali and Raksha Bandhan, in the past few years, we have been successful in creating ‘gifting as a trend’ around two ‘younger’ occasions — Valentine’s Day and Friendship Day,” Peres adds.

DO-GOODER BRANDS TAKE A FESTIVE STAND, SPREAD CHEER

On another front, some brands chose to go on the path of doing good rather than investing heavily on campaigns. While Century Ply’s initiative ‘Heroes’ aimed at felicitating the everyday heroes who regularly bring alive the brand ideology, ‘Sab sahe, mast rahe’ in their everyday lives, experiential agency Candid Marketing came up with an initiative, ‘Light up a Smile’, where the team could either opt for a Diwali gift given to them by the company or choose to share the same value of money as a contribution to three organizations – Akshaya Patra, Helpage India and Paraplegic Rehabilitation Centre.

‘Mission One Crore: Pledge a saree, Pledge a smile’ was e-commerce brand LimeRoad’s way of driving responsible consumerism this festive season. “We are urging all of India not merely to buy for themselves, but to pause, think and pledge for others much less fortunate. We are partnering with Facebook & Goonj to ensure that festive happiness reaches these families. Our hyper active community of stylists have come forward and opened their doors to this campaign and 200 community-led collection points have been set up across India,” says Suchi Mukherjee, CEO & Founder, Limeroad.

The State Bank of India has decided not just to create communication about its products, but also bring alive the spirit of festivity and give an almost tangible meaning to it by triggering donations through ‘SBI Hope Loans’ this year. Rajnish Kumar, Managing Director, SBI says, “This festive season, every loan taken from SBI will be named as a Hope Loan, and the bank will donate Rs 100 to chosen NGOs for every loan. Early feedback on our advertising campaign for this initiative has been very encouraging. We hope to spread the festive cheer to as many fellow citizens as possible.”  

@ FEEDBACK samarpita.banerjee@exchange4media.com

Tags : Impact Feature