Market factors including ongoing and exponential growth in mobile penetration (771 million mobile phone users as of January 2011), the advance of faster 3G services, and a marked increase in the number of brands harnessing mobile media to connect with consumers have combined to make India the epicenter of mobile marketing activity and growth in the Asia Pacific region.
How can brands and agencies prepare to take advantage of opportunities in this rapid growth market? What will move the dial on mobile marketing spend and activity? We catch up with Krishna Prasad, who heads up the digital division of Dentsu India, the Indian arm of Japanese advertising group Dentsu Inc.
By way of background, Dentsu Inc. kicked off operations in India in 2003 through a joint venture with the Mogae Group. Earlier this year the company became a 100-percent subsidiary of Dentsu Inc., Tokyo, and restructured into four independent, full-service advertising agencies: Dentsu Communications, Dentsu Marcom, Dentsu Creative Impact, Dentsu MediaTech and a digital agency called Clickstreamers. Clients in the local Indian market include automotive brands (Toyota, Honda, Suzuki), consumer electronics companies (Canon, Panasonic, Hitachi), as well as a mix of telecoms and technology providers.
Teaching brands mobile
Worldwide mobile marketing is just beginning to gain serious traction – and India is no exception. In India ad spend on mobile accounts for only a few percentage points of the total digital advertising budget, a small but growing portion of the overall advertising budget that currently hovers in the single-digits.
However, Krishna is convinced mobile spend as a percentage of overall ad spend will increase as more brands understand how (and why) mobile can help them achieve campaign objectives and engage with their audience. “The digital ecosystem is just shaping up, and brands and agencies are quickly moving up the learning curve,” Krishna notes.
To encourage this momentum and provide brands with a roadmap to navigate the mobile marketing landscape Dentsu India has launched the Mobile Marketing Discovery Program, an initiative that provides a selection of brands with insights into solutions and use cases that showcase the unique advantages of mobile.
According to Krishna, the aim is to go past the nuts and bolts of media buying and educate brands on how to “develop a comprehensive and effective marketing strategy with mobile at the center.” To this end Dentsu supported the brands with mobile marketing ideas, solutions and strategy.
Talking climate change
One of the first brands to step up and take part in the mobile discovery program was Suzlon, a leading provider of wind power and green energy headquartered in Pune. Suzlon launched its mobile campaign – focused on building brand awareness and educating the target demographic (tech-savvy, affluent smartphone users) about the power of wind energy — with Dentsu in October 2010. A major objective was to popularize the regular climate change blog written by Suzlon chairman Tulsi R. Tanti.
The campaign ran some six weeks and consisted of display ads on the mobile portal homepage belonging to Indian mobile operator Airtel, as well as banner ads on App Central, the operator’s application download page. The call to action: people were encouraged to click through and explore the views posted on the Suzlon blog.
According to Krishna, the campaign generated some 4 million impressions and a click-thru rate of just over 3 percent. “The creatives and the approach allowed Suzlon to engage users and get them interested in knowing more about the power and relevance of wind energy.” More importantly, the sharp focus on showing real results, analytics and ROI, “establishes mobile marketing as a viable medium.”
Messaging and marketing
What are the effective mobile marketing formats? It’s a hard one to call. Display is popular because it’s familiar. “In India many marketers focus primarily on a banner buy because the mobile operator portals are a popular destination among consumers.” Put another way, walled garden portals (on the way out in regions such as Europe and North America) are still big business in India, where consumer appetite for mobile content (wallpapers, ringtones, games) is skyrocketing.
Text messaging is also growing from strength to strength, a development that bodes well for mobile marketing approaches that harness SMS to connect with people (regardless of whether they do/don’t own a high-end smartphone).
Mobitude 2010 — the annual analysis of customer mobile phone usage published by mobile operator Bharti Airtel, reveals that a whopping 90 billion text messages were sent via the operator’s network in 2010. A high point was the Hindu holiday Diwali (festival of lights), an occasion that saw 12 billion (!) text messages exchanged in just one day.
The market is primed for SMS marketing — and brands are waking up to the opportunity — but there is also concern about the tremendous rise in the amount of spam. In fact this blog post reports that as many as 100 million spam messages are delivered to people on their mobile phones every day, a flood that can be traced to a change in how bulk SMS is bought and sold.
Naturally, excessive spam has turned people off marketing messages that simply interrupt their daily routine. But it has also created an opportunity for brands that ask permission first. “There is great potential for [text] marketing,” Krishna says. “But brands should not be spamming the consumer. It must be for the consumer to decide if they want to receive brand messages, and to tell us the brands and verticals they want to receive advertising about.”
Personally, Krishna is “all in favor” of opt-in and marketing approaches that give consumers a voice in the advertising they receive. “India has made a good start [in permission marketing], but it has a way to go.”
Relationship gap
What’s holding up progress? In a word, regulation. It also doesn’t help that multiple levels of opt-in (required by telecom authorities and mobile operators) are confusing both consumers and advertisers.
But the real barrier may be the “lack of enablers” to move the market and get brands to the “next level of mobile marketing.”
As Krishna sees it: the emerging mobile marketing ecosystem needs some guidance from enablers that understand the space — and the requirements of all the stakeholders. He added that solutions like Optism are needed to facilitate relationships between all the parties.
“Companies that understand this space well, and can also hand-hold the operators at one level and the agencies at another level are absolutely needed to jumpstart this market,” Krishna says. “This approach is essential for this market.”
What’s next?
Krishna says Dentsu will continue with initiatives and efforts (such as the Mobile Advertising Discovery Program) to help brands make the move from digital to mobile. “There’s no value in being just a middleman….It’s all about connecting operators and brands in a way that helps them reach their objectives, and it’s a role we have chosen because we understand advertisers and what they want to achieve.”
Where is the opportunity in the Indian market? Growth in smartphone penetration rates and mobile Internet usage (150 million mobile data users) are developments that pave the way for more brand interest in mobile apps.
Krishna is also “excited” about the opportunity around mobile coupons and vouchers, rewards that could add value to a variety of mobile campaigns across a range of mobile formats. “It could be SMS, it could be scanning with a smartphone — and it could be approaches that mix and match the two. Consumers are keen to sign up for this [coupons and discounts], and offering mobile coupons would deliver amazing results.”
At the other end of the spectrum, permission marketing can also deliver positive results provided it offers people what they value. “In many parts of the world TV and press are dying, but in India it’s growing. So the question becomes: if consumers already get 10 pieces of information a day, what can brands offer so they sign up for an 11th piece?”
The bottom line: Get the value exchange right, and mobile marketing — especially permission marketing — has the potential to be huge.