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Home : Blog : May 2013

Social Media Marketing Trends in India

Ernst & Young (E&Y) recently released a report titled "Social Media Marketing: India Trends Study 2013", which carried some interesting insights on social media marketing in India. The study was conducted on social media-savvy organisations in the country.
  • Why: 95.7% of the surveyed organizations use the medium to build communities, while 76.1% use it as a platform to highlight brand news. Next up are customer service at 58.7%, lead-generation at 43.5%, and market research at 41.3%.
  • Where: Facebook is the most important social media platform for engaging customers, followed by Twitter, YouTube and blogging. Other, emerging, platforms such as Pinterest and Google+ are being deployed by almost 50% of organisations.
  • Engagement: Engagement is driven by generic content, rather than branded content, posted several times a day on the target social media platforms. Contests are popular too, especially pictorial contests; featuring once a month. 50% of the organisations have created mobile phone apps, with another 25% planning to do so.
  • Online Advertising: 83% have used social media ads, with the majority of the ads being used to promote a contest/promotion or being deployed for brand awareness. Over 88% of the organisations that have used them find social media ads to have assisted in achieving the stated objectives.
  • Measurement: For 81% of the organisations, the measurement of the success of a social media activity is through metrics such as "likes", "talking about", etc. However, over 46% of the organisations have not measured RoI for their social media activities.
  • Budget: 41.5% of the organizations said that around 1%-5% of their marketing budget in spent on social media. Three-fourths of the organizations have a social media budget below Rs. 1 Crore, while a little over 25% have social media budgets exceeding Rs. 2 Crores.
Why is it important for brand-owners to be social media savvy in India, considering the fact that Internet penetration remains at a low 12% (at about 150 million) of the population, compared to 43% in China (at about 575 million) and 80% in the USA (at about 275 million)? Well, according to the Boston Consulting Group (BCG), in its Digital Intensity Index study, the number of Internet users in the country is expected to grow to 330 million by 2016, possibly overtaking the USA to become second-largest geography, by number of users. More importantly, the study (covering 25,000 Indian consumers aged 18 to 55 living in 26 locations - the biggest metropolitan areas and a mix of tier 1, tier 2, and tier 3 cities) revealed that (as reported by Warc):
  • Digital media currently influences $30bn of consumer spending, in urban India, each year; a figure five times higher than the total ecommerce expenditure in the country. Overall, it predicted that the new media would impact $150bn of expenditure in India's metropolitan centres by 2016.
  • 40% of the study's panel agreed that the web currently had a role in shaping their purchases, most typically as a result of researching and comparing products and prices via this route.
  • Digitally-influenced shoppers generally earn higher incomes than the norm, are disproportionately represented in key categories, and spend more money on products than their less-connected peers.
Our experience with a handful of social media-savvy B2C companies has revealed a more complex picture of social marketing practices in India.
  • Budget

    The budget set aside for digital marketing, as opposed to social media marketing, is anywhere between 2% and 7% of the total marketing budget. However, almost 90% of this allocation is put into online advertising - PPC, display, social media, etc. The budget for non-advertising social media activities is therefore a fraction of the total marketing budget.

    Recommendation: Brand-owners will have to plan a larger outlay for content marketing, in order to ensure that visitors attracted to company-curated properties, by online advertising, will find their expectations fulfilled. Paid advertising may be more effective than organic posting, as revealed by a recent study conducted by Kenshoo Social, but this should not mean that non-advertising social media activities are neglected.

  • Channels

    Presence on Facebook, Twitter, and YouTube is deemed a necessity by all brand-owners. Google+, Instagram, and Pinterest presence is seen as nice-to-have. Facebook, typically, tends to be given the most attention, followed by Twitter. YouTube is generally treated as an online repository for the brand's TVCs. Although a few of the companies have dived into Pinterest, the results, from the perspective of brand buzz, have been disappointing.

    Recommendation: Now that Facebook and Twitter are saturated, brand-owners need to start building expertise (internally or as an outsourced capability) in Google+, Instagram, Pinterest, and Tumblr. Also, YouTube should be better utilised, with the creation of custom video content for online users.

  • Measurement

    The effectiveness of social media from an RoI perspective is rarely, if ever, measured. In most cases, the companies receive metrics from the media agency (since most of the digital activity is advertising) and makes do with them. The quality of the data is unknown. In addition, the fact that the reports do not include raw data, restricts the companies from carring out further analysis.

    Recommendation: Brand-owners should make arrangements to receive raw data for all online activities they execute, and should have the tools to carry out social marketing analytics on such data. In addition, a closed-loop marketing tool should be used to measure RoI, both from online and offline conversions.

  • Brand Buzz

    All the companies monitor Facebook and Twitter for consumer buzz, customer feedback, and customer complaints. The response mechanism is mostly effective, and response is timely. However, such is not the case for third-party customer fora, review sites, and feedback sites. Complaints and comments on these sites are rarely tracked, let alone responded to.

    Recommendation: Brand-owners will need to invest in a sentiment analysis tool to track brand buzz anywhere on the Internet, and have a process in place to respond to consumer and customer chatter, in third-party sites, in a timely manner and effectively.

Brand-owners in India will have to learn how to harness the power and tap the preferences of India's online population, to their advantage, through a process of trial and error. Template-based approaches may not be the answer in a market as diverse as online India.
Tags: Social Media Marketing, Digital Marketing, India
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