Growth is outside the metros; 70% of youth TG are in small towns: Shashi Sinha
DIGIXX Summit & Awards 2020, the flagship property of Adgully, analysed the current situation rising out of the COVID-19 crisis and discussed ways in which Digital is paving the way forward for the industry. Industry experts also spoke how to strategise for growth in challenging times.
The Summit commenced with a keynote address by one of the industry’s most respected veterans, Shashi Sinha, CEO, IPG Mediabrands India, who provided several valuable insights on ‘Accelerating Digital Transformation in the post-COVID-19 World’.
At the outset, Sinha pointed out how over the last two months India has seen a very dismal situation as sales have dropped considerably, which had also had a direct bearing on the AdEx. “Therefore, our first task is to come back soon,” he affirmed.
According to him, one of the major concerns for India is that the contribution of AdEx to the country’s GDP was very low, as compared to that of the US and China. “The US and China clock somewhere around 1.5 per cent of the GDP, while India’s is just at 0.3 per cent,” Sinha said, adding, “We have underleveraged our efforts and the reason for that is that our volumes are high and our supply overshadows the demand and our pricing is one way. Also, we have only 300 or 400 advertisers and these are primarily the large brands. While we have a long tail of retail brands, these brands hardly contribute, vis-a-vis the US and the West, where there are a large number of brands – both big and at smallest levels – who spend considerably. I think digital acceleration has already commenced with the use of technology, while Work From Home (WFH) and use of e-commerce for purchases seen during the lockdown is expected to continue even as restrictions are being lifted.
Sinha further pointed out that new customers are being added, leading to high consumption of news and entertainment on TV and on digital, followed by e-commerce, which really signals the start of digital transformation. He mentioned about ITC tying up with My-Gate, social commerce start-up Simsim commencing operations, Facebook also planning their social commerce venture, Swiggyand Zomato looking at the grocery space and auto companies are looking at virtual showrooms. “Thus, there is a high degree of transformation and changes that will happen while it will take time for the economy to bounce back,” he added.
Data driven marketing is another aspect that Sinha emphasised on. According to him, first party data has not been exploited to the full potential. He stressed, “This is the best time for companies to focus at their own data and exploit it instead of going outside. Efforts and skills need to be deployed to leverage this data.”
At the same time, brand building efforts will not go away. Power of brands will work as India is still under-penetrated for brands. “So, brand building and digital will play a major role. Third party measurement should also be looked into more seriously as that will also help brands to spend more if a robust eco-system is to be put in place. Finally, growth is going to come from smaller towns, as 70 per cent of our young audience are outside the metros. Here again, we should deeply introspect the use of digital as physical distribution is not the solution,” Sinha maintained.
At the same time, he also said that recovery will be slow as we don’t have strong MSMEs unlike the US and China, where the depth of advertising is robust with the MSME sector. “While the government has made some significant progress here, but since it is highly people intensive, there are many challenges. But in the area of MSME, we have a great opportunity. We should think how we can help the MSMEs as rural India is the growth belt and the government is helping the farmers. There is a huge opportunity one can unearth as the future and growth is outside the metros,” Sinha emphatically concluded.