[Link]

by Arcopol Chaudhuri

The consumer craze for Tata Nano was built on an interesting publicity platform. After the car was launched, it was advertised with a media mix unheard of in India’s recent media history — zero ads on television, a judicious use of print ads and an active Web interface. In the run up to its launch, Nano got the media attention equivalent to perhaps the largest paid advertiser in the country.

Copywriters would have salivated at the thought of making TVCs for the vehicle. Did Nano need a big-bang advertising blitzkrieg? Should advertising have begun earlier? What is the ideal media plan for Nano? DNA asked media experts.

A plan focusing on customer satisfaction initiatives
Here’s a brand that presumably has more than the required “pull” factor versus the regular “push” factor that brands need to create to achieve the “pull.” The media attention and space/time that Nano garnered over the last few months would perhaps be much more than the largest paid advertiser in the country for the corresponding period. The initial demand here would certainly be more than the supply.

If we were the media agency for Nano, our recommendation would have been to clearly divide the communication plan into 3 or 4 phases — all phases underpinned on the need to focus on various customer satisfaction initiatives. The company should focus on delivering a top-class product so that the consumer doesn’t end up spending a large sum on maintaining the vehicle. The first set of owners can either kill or make the brand. Considering the hiccups the project has gone through, it is a crucial period and a scenario that has both its positives and negatives as this lot will not be a substantial number.

The advertising in phase I — a 6 month window — should have news value since media is sure to follow the brand success. We would have used every possible consumer touch point to drive home the happy feel of the first lot of consumers, including the national news television discussion forums with owners, Web chat, interactive newspaper columns, interactive SMS communication and radio call-in programmes et al. We would then have ensured brand experience/touch and feel of the brand in specific cities. The last stage of the first phase, leading into Phase II, would be the announcement of a Nano owners’ club — subscription through paid memberships.

The club members would enjoy various perks/facilities so as to enable them to feel privileged. There should be consistent focus to ensure the members receive a pleasant surprise every 3 months. If handled well, this has the potential to partly fund the subsequent phases of Nano advertising, which should evolve based on the results of phase one.
–S Yesudas, CEO, R K SWAMY Media Group

We pioneered similar strategy for Maruti Swift
There is nothing unusual about the Nano media strategy. When a launch is preceded by several months of media publicity, which continues after the product is actually rolled out, there is no sense in spending too much on paid advertising. In fact, we pioneered this strategy with the India launch of Swift some years ago.

The product had been revealed at all the major international auto expos and it was for the first time that an international launch was taking place simultaneously with the India launch. There was also much PR activity. So we dispensed with the usual TV advertising and instead got 27 channels to create their own teaser-revealers of the car, which was supported by intelligent use of print, online and radio.

We have since used this strategy for all subsequent launches from Maruti. Typically, when there is an expected booking period, TV advertising is slated to break only after a gap of a few months when there are sufficient cars on the road. I am not sure what is the geographic strategy for Nano as an entry level car – the demographic strategy seems fairly clear – but depending on the market selection, a judicious use of various types of out-of-home media must also be on the line.
– Lynn De Souza, chairman and CEO, Lintas Media Group

Use newspaper ads to tell people where to book
If you look at the value proposition of the Nano, it’s pegged at its affordability and low price. Finally, we need to realise that it’s all about the business. It would be unwise to burden the already ambitious project with an unreasonable marketing campaign that renders the business of making and selling a Nano unsustainable.

One would rather see how to use and further fuel media curiosity and hype generated by the Nano launch to push all relevant messages to the market. If advertising costs money, that cost would have to be added over a period of time to the Nano price and would need to be paid by the consumer. Fundamentally, I wouldn’t agree with large format, large budget ad campaigns for Nano. If I were the media planner, I would have used newspapers to just give details of where to book.

Nano did no ads and yet the world knew about the launch date! It’s shocking. My driver asked on the launch date if we were going to book! This is what I call a big-impact entry. And if all this was without an ad, maybe it’s just smart marketing. At the heart of it, advertising just serves various messages that we want to communicate to the audience. So far, all the messages have been carried within the hype and the hoopla. That advertising cost conservation is part of the Nano business model.
–Atul Phadnis,CEO, What’s-On-India

Would you advertise a cure for cancer?
Advertising is only needed when the product doesn’t make news itself. Nano was such a ground-breaking product that it needed no advertising. When it was announced, 5 pages in the newspaper were about the Nano – three were editorial pages, which I think everyone read and two pages had ads, which I think almost no one cared for and probably was a complete waste of money.

If I was the media planner on the Nano account, I would only advertise information on ‘Where and how do I book a Nano?’ (Strangely, the Nano ads seemed to downplay this.) And maybe, this information needs to come less from Nano and more from Tata Capital and Carwale. So my media plan for Tata Nano would be — nil on TV, press and outdoors and Rs 10 lakh over two months on the Web (just to steer people to the website and financing information as the site is not well indexed). I would use above-the-line media only later, if there was any competition. But I don’t see competition for a couple of years. Isn’t it obvious?

If I discover a cure for cancer, I won’t spend a dime to advertise it. The world will be at my doorstep to publish news about it. The Nano is in a similar category. If they were so incredibly creative on the product itself — why bother with creative on the advertising? A product’s marketing IQ is inversely proportional to its ad budget. The more differentiated you design a product, the less you need to spend to persuade people to buy it. The dumber your product is, the more you need to spend to market it. All those brands need to advertise on IPL because you wouldn’t think of them otherwise. The Nano doesn’t have that problem.
– Mahesh Murthy, founder, Pinstorm

[Link]

by Sruthi Krishnan

On April 1 2004, many thought it was a prank – the public launch of an email service with 1 GB of free storage. Once convinced that it was the real deal, there began a feverish search for an invite to an exclusive club. It was the internet’s stratosphere and those who belonged had an exclusive address – yourname@gmail.com.

On the eve of Gmail’s fifth anniversary, Mahesh Murthy, founder of Pinstorm, a digital marketing firm, recalls what it felt like in April ’04, when he was one of the lucky few to receive a Gmail invite.

“The 1 GB of storage then was mind-bending. It was more than I could ever imagine – and more than I thought I could ever use. Today I have over 7 GB on my Gmail account – and I want more,” says Mr. Murthy.

Compared to the competition, 1 GB storage was unheard of.

“We take it for granted now, but for perspective, Hotmail and Yahoo, I think, offered something between 2 and 10 MB,” recalls Venkat Inumella, vice-president, product development, at a start-up firm in Bangalore, who received his Gmail invite in May ’04.

Invite system

The system of allowing users only by invitation was Google’s way of keeping a tab on the number of users on board. “The invite system was a master act in viral marketing. If you were in your early twenties and had a Gmail invite, you commanded immediate respect among your geek friends,” he adds.

With demand far exceeding supply, the marketplace went nuts.

“Sold like hotcakes”

“Invites sold like hotcakes on eBay and on a lot of forums that sprung up all over the place, some people trading them for as much as a few hundred dollars! It was fun tracking the going price daily as it crashed in a matter of days, as the invites multiplied,” recalls Mr. Inumella. “Some script kiddies wrote these ‘Gmail invite generators’ and tried to ‘guess’ valid invites. The odds of guessing a random 30-character sequence correctly are like one in a bazillion gazillion or something. That didn’t stop people from trying!”

In some cases, the Gods came to the rescue. Jai Iyer, product strategy head at a stealth-mode start-up, remembers his friend who was desperately seeking a Gmail id.

“He found this site where Gmail invites were being auctioned or bartered away. Someone on that site agreed to give my friend an id in return for a ‘mystic Indian sanskrit chant.’”

Minutes later, the proud owner of a Gmail account, his friend typed out “Shuklam baradharam Vishnum” in an email.

[Link]

by Sreejiraj Eluvangal

Soaring user numbers aren’t quite translating into moolah for social networking and social media sites.

The likes of Orkut, Myspace and Facebook are fast realising that the traditional pay-per-click advertising model is just not working for them.

Such networks, based on content created by members, account for the largest chunk of web traffic today. Yet, almost all of them are struggling to monetise these numbers. Hari Krishnan, who heads the Indian unit of the world’s largest social networking site, the Rupert Murdoch-owned Myspace.com, acknowledges that unlike users of search engines, their members may not be in a mood to click on advertising links.

“The concept that you keep opening new pages to get information is from the age of the portal. Besides, our pages are designed in such a way that the user has all the information on a single page,” Krishnan said at the ‘Social Media Summit’ in Mumbai on Friday. “So, the click-through rate for ads is very low on social networks.”

Most of the big internet players are present in the ‘social networking’ category, built around the concept of users keeping themselves entertained by sharing thoughts, videos and pictures, etc. While Google has Orkut, News Corp has Myspace and Microsoft bought a stake in Facebook a year and a half ago.

The popularity of such sites has rocketed over the years. According to web analytics firm compete.com, Myspace accounted for 2.35% of the total time spent online by all US residents in February 2009, compared with 0.34% for CNN.com and 0.09% for NYTimes.com.

Globally, around a third of all web traffic is estimated to be generated by such websites. Orkut, for example, has around 14 million registrations from India, where only 35 million people access internet at least once a month.

The category accounts for five out of the top ten most visited sites. However, thanks to very low click rates, industry participants suspect the category accounted for just 5% or less of the total online ad spend in the country in the last 12 months.

“The return on investment (RoI) from social media don’t match the media planners’ idea of RoI,” says Beerud Sheth, co-founder of mobile and online solutions provider Webaroo Technology India. “You cannot ask me ‘CPL (cost per lead) kya milega’?” he says, referring to the price quoted by search-engine-marketing firms for each lead they generate.

Instead, he is hawking ‘engagement’ with consumers through discussion fora, groups and even the plain old banner ads around brands and products. “If a consumer endorses your product on a social network, it will have much more impact than any form of advertisement,” says Sheth.

However, most brand managers are looking for measurable results such as clicks and leads. Prasad Narasimhan, marketing head, Virgin Mobile, says, “We can talk about engagement and all that. But if I have to put in Rs 2 crore of my brand’s money, you need to find some mathematics to measure the impact.”

Some stakeholders believe the impasse will be ultimately resolved by going back to the conventional idea of charging for the ad, whether or not someone has clicked on it. “The problem is that we are applying the metric of search advertising to social media,” says Mahesh Murthy, founder of the digital marketing agency Pinstorm. “How are you measuring the RoI when you advertise on TV? You are paying because people are spending time in front of your brand. They have to come back to the idea for social networks as well,” he adds.

Management guru Thomas Davenport had told DNA earlier that it was doubtful these sites would ever make money. “Some of these things kind of rise and fall with fashion. Clearly, they have tapped into something, but I am slightly sceptical about them in a business context,” said Davenport, who holds the President’s Chair in Information Technology and Management at Babson College, located in Wellesley, Massachusetts.

[Link]

by Sreejiraj Eluvangal

Downturn forces advertisers to switch to pay-per-performance models from display ads

MUMBAI: Online advertising industry is expected to continue with its high rate of growth despite a global economic downturn dampening the outlook for traditional advertising players.

The growth is expected to be led by digital pay-for-performance advertising companies, who are making hay as companies seek higher returns on their investments.

Unlike the traditional display advertising, companies investing in performance-based advertising have to pay only if the target audience or the viewer performs or acts as a reaction to an advertisement. The action can be just a click or filling up an order form or even an online sale.

Vivek Bhargava, chief executive officer of Communicate2, said last month was the best period for the company since its debut more than a decade ago. Communicate2 helps companies manage their accounts on Adwords, the largely pay-per-click advertisement service run by Google.

“One of our old clients in the financial sector suddenly increased their account size from around Rs 20 lakh to Rs 24 lakh to Rs 80 lakh,” he said.

Bhargava said his clients feel more comfortable when they have to pay only when someone clicks on the ad or buys a product through an ad. “Sales are sales. Even if it’s a downturn, a company still needs to sell. So, if I offer a pay-per-sale offer, how can they refuse?”

Mahesh Murthy, a veteran of Grey India and Ogilvy Hong Kong, said, “The conventional advertising industry is likely to miss its targets by a wide margin this year.”

Murthy, the former country head of Channel V, is the founder of Pinstorm, a pay-for-performance firm that is handling around a seventh of the Rs 700 crore online ad spend in India this year.

Last year, total revenues for the advertising industry were around Rs 17,000. Murthy estimates that revenues will fall well short of the Rs 19,000 crore target for the current financial year.

“The industry is expected to see revenues of around Rs 8,000 crore in the first half and the second half is unlikely to be any better,” Murthy said.

Revenues of the online advertising industry are, however, expected to increase from around Rs 450 crore last year to around Rs 700 crore this year despite the downturn. Currently, display-based players and performance-based players have almost an equal share in the total online advertising ad pie.

Murthy said Pinstorm, which is only into pay-for-performance advertising, has been growing by 300% every year for the last few years. “This year, too, we expect to be at least double our size last year,” he added.

However, unlike the performance-based digital firms, players into display-based online advertising are feeling the heat of the downturn.

Subho Ray, president of the Internet and Mobile Association of India, said the downturn is forcing advertisers to switch to pay-per-performance models as they seek higher returns on every rupee spent. “Smaller websites and ad networks are benefiting, while big portals, which use the traditional display advertising, are losing their importance,” he added.

Portals like Rediff.com that depend on display-based advertising — where ad-rates are not linked to number of clicks on the ad — have taken a hit.

Rediff.com, one of the most sought-after ad destinations on the Internet in India, said its second quarter advertising revenues (denominated in dollars) slid by almost a fifth over the previous quarter, partly because of the rupee devaluation.

Despite an increase in the number of advertisers, Rediff has been unable to maintain its growth in advertising revenues in the last two quarters.

[Link]

by Gouri Shah

Mumbai: India’s cricket captain M.S. Dhoni and actor Saif Ali Khan will stop at nothing—stick out tongues at each other or call each other names—to get the flavour they favour of a potato chips brand voted the flavour of the month.

Interestingly, the TV commercial for Frito Lays potato chips marketed by Pepsico India Holdings Pvt. Ltd has an online avatar at www.whatstheprogram.com, where viewers are urged to cast their votes for the flavour they like.

It is one of the many brands that are seeing the benefits of launching campaign specific micro-websites, or linking their mainstream ads to these sites in the belief that it not only taps into the interest created by a new advertising campaign but also helps consumers get right to the product information they want, rather than having to wade through a corporate website.

This is a trend, experts say, that has gained momentum with the increasing popularity of search engines such as Yahoo! and Google.

“It’s about an attitudinal shift from browsing to searching,” says Prasanth Mohanachandran, executive director of digital services at Ogilvy and Mather India Ltd.

In the past few years, Mohanachandra says, consumers have started seeking specific content and information online. It is probably why companies are scrambling to communicate their brand values in the best possible way—specific, easy-to-access and engaging.

This is where micro-sites—based more on ad campaigns and tag lines, rather than the company or brand name—come in.

“Such micro-sites get smaller things, such as features of a brand, optimized and showcased better,” Mohanachandran says.

A case in point is that of the online brokerage Sharekhan Ltd, which set up three different sites to cater to different sets of consumers—beginners, investors and traders. The micro-site for beginners, which was advertised along with the company’s ad campaign, steers clear of financial jargon and encourages visitors to fill out their contact details. Within 72 hours, a representative from the company visits them to educate and initiate them into the trading process.

A micro-site could also help launch a new campaign, exemplified by mobile telephony service provider Idea Cellular’s site called www.whatanidea.co.in featuring Abhishek Bachchan, computer chip maker Advanced Micro Devices Inc.’s www.askvishy.com featuring their brand ambassador chess grandmaster Vishwanathan Anand, or Lux beauty soap’s site www.xappeal.in.

A micro-site could even help launch a new product or variant, as was the case with a now defunct Hindustan Unilever Ltd’s brands Ponds’ website www.iblushed.com.

Then again, such websites may carry forward a brand’s core tag line, as in cigarette maker ITC Ltd’s food division’s www.bingeonbingo.com or Cadbury India Ltd’s www.meethamoments.com.

Whatever the purpose, these campaign-specific micro-sites are being used as a cost-effective and sticky medium for brands to engage with their target consumers and communicate all aspects of the brand, which may not be possible to do in a 30-second advertisement on television.

While most companies are armed with a basic corporate site that exalts the benefits of their brands and what they do for the consumer, campaign-centric sites create a strong interface with consumers, are more interactive and can also prove to be a great medium for market research through consumer feedback, say experts.

Tata Motor Ltd’s small car Tata Nano is a case in point. For the first 12 hours, people around the world were logging onto www.tatapeoplescar.com to check out the $2,500 car. The site ran several contests that encouraged consumers to name a celebrity who was the best match for the car (cartoonist R.K. Laxman’s “common man” won) and a tag line for the car, and even sought feedback on colours and accessories.

The same goes for Frito Lays, which is currently using its micro-site to get consumer feedback on two potato chip flavours the company has launched.

“It’s always a challenge for an iconic brand to continue being relevant for its target audience. Especially when its target audience is the youth,” says Shavon Barua, vice-president and client services director, JWT India, who works on the brand.

The ad agency created the micro-site to stay connected with their brand’s core audience who were spending more time online than they were in front of the television. “We realized that this was a key medium, and a great place to interact with the youth. Any piece of communication that puts them in-charge has always been met with high interest,” Barua said.

Industry watchers, however, say that while a micro-site is a great medium to interact with consumers, illustrate and articulate what the brand stands for, and create purchase intent, few companies are willing to go that extra mile.

Sometimes the spends on this count are as low as 1% of all media spends, says Mohanachandran.

More often than not, sites launched with much fanfare are eventually allowed to die due to lack of sustained support from the client.

“Don’t create a throw-away site. That is a complete waste of everyone’s time and money,” says Mahesh Murthy, chief executive officer of digital advertising firm Pinstorm.