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Youth to drive e-commerce growth in India: IAMI summitnews
19 January 2006

Mumbai: The Internet & Mobile Association''s two-day ''digital summit'', which ended yesterday, covered various issues on online advertising and sales ranging from the role of the internet in the Indian economy; issues and growth opportunities of the broadband access, an analysis of the retail power of the web and the growth prospects of the "online marketplace", the prospects of the online media in the traditional media mix, and growth opportunities of mobile marketing.

Online marketing, which evolved in the US earns 50 per cent of its revenue from online advertisements and sales. India, in comparison, is yet to tap the opportunities available on online advertising and marketing and marketers will have to tap the youth market to promote online advertising. This would require adequate broadband to help the online advertising industry grow.

"The revenue earned from online advertisements in India is less than one per cent," noted Preeti Desai, president, IAMAI. "There is a classified market of 1,800 crore here; we will just have to search it," Desai added.

Digital ads are interactive, enable immediate feedback (through reply e-mails, smses) and offer an opportunity for interaction. Says, Rohit Mull, VP marketing, Tata AIG, "We have to extend the benefits of online medium to the traditional media. But at the same time, is there enough integration between mobile and net plans?"

Penetration of digital products is the highest amongst youth. 61.2 per cent Indians are below 30 years and 50 per cent are below 25 years. 22 per cent of the advertisement products cater to the youth and 59 per cent of the advertisements are youth oriented. According to Raj Gupta, president, Insight, "We need to have media for youth and develop a youth culture as the youth spends maximum time surfing the net. Although, reaching the youth is 26 per cent more expensive."

Focusing on the need to integrate online with the traditional, Gupta said that 70 per cent of TV viewers avoid ads. The avoidance is less online and much lowers on mobile SMS, he added.

"The web is penetrating the social and business fabric of our lives," said Pearl Uppal, director, sales, Yahoo India. "It has made brand management and brand engagement possible. Also, sales conversions and people to people interactions are easy to measure, " she added.

Highlighting the glaring difference between online and traditional media Raj Nayak, chief executive, NDTV Media Limited. He pointed out that people find online media more complicated — "There is a lot of mystery behind the internet. The herd mentality of on-line advertisers need to be changed," he said. Drawing comparison between ad revenues earned by the traditional media and the online medium, he said, "Though 3.8-crore people surf the net, online media has been able to attract only 100 advertisers and generate ad revue estimated at Rs120 crore. TV, on the other hand has 5,000 advertisers."

Is mobile marketing really effective?
Marketing the online directly or via mobile phones is the basic component of developing a personal relation between the target groupand the brand. Prresiding over this session, Sandy Agarwal, managing director, Asia Pacific, Enpocket, and Krishna Durbha, head business and marketing, VAS, Reliance Infocom Ltd, focused on the growing opportunity of mobile marketing in India and how leading companies across all sectors are adopting this medium that has the lowest ad spends with a greater reach and better effectiveness. Agarwal said that online marketing has the fastest growth than any other medium.

Durbha suggested that users should be engaged by constant innovations in the services. Product launches, advertorials, opinion polls have gained tremendous response via these media, he said.

Delivering Digitally
How feasible is the digital media for marketers and how responsive is the audience to ads displayed on the net, or flashed through the SMS? One of the major challenges to it according to Sudhir Nair, associate vice president, Grey Interactive, is that the marketers and the advertisers have set very high standards for themselves. "For different categories, there are different benchmarks," he said.

Lloyd Mathias, marketing director, Motorola, felt that the digital medium should not be used as a build up to the traditional medium. "As the reach of the digital media spreads, marketers will have to wake up to the reality and invest more on talent that will think online," he prophesied.

"People get bored seeing online ads," noted Naren Chandra, head, marketing, international banking, ICICI. One of the methods to keep a consumer hooked to the product online was to constantly change the display and content of the product advertised, he suggested.

Samsung CDMA, marketing head, Dinesh Sharma, opined that dealers and distributors should be involved in the process. A positive of using the digital media was driven home with an example. Mr. Sharma informed, "A company can give its potential customer a virtual experience of using the product, before actually buying it."

The need to encourage online research in India was highlighted by Kedar Sohoni, director, Cross-tab, who pointed out that 50 per cent of quantitative research in the US is done online.

Why is Search so Hot?
Search engines are constantly making advances to understand and deliver, credible and relevant matches to what the user wants. Dr Ram Prasad, CTO, Yahoo! India said, "Deep content with structure mining, efficient updates, social networking and a through understanding of the user behavior, will aid in overcoming the challenges."

Search allows a company to locate its customer An estimated 1.1-billion people search information on the net every month. "Search provides best ROI on media, spent across a number of categories, because it is performance based. A customer decides how much he wants to pay for the product and also the cost conversion is better than banner conversion here." Ratish Nair, COO, , pointed out,

Incidentally, India has emerged a global centre for search after the US and the UK.

Impact of the Echo Generation
Generation next will determine the future of the online market in India. It is these young men and women who surf the net regularly, flash swanky mobile phones and are more knowledgeable about the use of these gadgets and their applications then what their parents know. The challenge faced by online marketers is to invite and retain the young customers; offering them a bouquet of options to chose from.

Amitabh Srivastava, CEO, GroupM, South Asia, said "With the evolution of multi channels, concept stores are designed in such a manner so as to invite consumers to have a virtual experience of the product they are buy and then shop online."

The young are well connected, well aware and because of inter connectivity is relatively influenced by its community and society. The youth is a part of the social fabric and has to be dealth with delicately and carefully. The new generation is connected in a different way-by-way of wireless and broadband. "The youth will control and determine what it wants and it should be hot, happening and big," said Srivastava.

Online strategies for customer acquisition
Online experience, value proposition, delivery and retention are significant roles for customer acquisition. Follow-ups on applications, quick services, infrastructure to meet the requirements of the growing demands of the industry, information, innovative technology and quick delivery of the products ordered on line, are the key areas to acquire customer confidence. The synopsis of the session also included making a customer feel like a king.

Harsh Roongta, Founder and CEO , said, "Online companies should be able to offer a customer delight programme. A customer should be kept informed of the status of his deal or application."

"We have to arouse the interest of the customer and hand hold new users. A customer should have easy navigability and the companies should offer address security concerns. The basic of any transaction is to keep things simple," added Sharat Dhall, business head, e-commerce, Times Internet Ltd.

Anaggh Desai, CEO, D''damas Jewellery (I) Pvt. Ltd. focused on the need to offer a feel good product to the customers.


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Youth to drive e-commerce growth in India: IAMI summit