101 Markets 2009: Understanding the complex heterogeneous consumer base of non-metros

By Abhishek Chanda , afaqs!, New Delhi | In Marketing
Last updated : September 25, 2014 04:04 PM
One of the sessions of this year's101 Markets, questioning whether the decoupling theory works for real for small town and metro India, also offered insights into other thoughts in play

With the slowdown looming large over the economy, it couldn't have been a better time to delve into the subject and find out whether it is true that non metro India is unaffected by the economic slowdown? Also, in such a scenario, are marketers doing enough to leverage the potential? This is what one of the sessions of this year's 101 Markets: India beyond the Metros, a day-long seminar organised by afaqs! to highlight the marketing potential and importance of the emerging towns of India, focused on, though a slew of different answers came up as opposed to the question at large. The event was sponsored by STAR Ananda, STAR Majha, Hindustan and Jagran Solutions.

The panel discussion was moderated by Kishore Chakraborti from McCann Erickson India and the speakers included Abdul Khan representing Tata Teleservices; Satyajit Sen from ZenithOptimedia and Neeraj Sanan from MCCS.

Chakraborti began the session by throwing open the discussions with his own take on the way metros have been behaving. He said that metros are decoupled in their own problems. "May it be lack of space or energy, metros have now got filled up to their brims and are slowly cracking up," he said. As small towns are slowly getting cash rich as compared to the EMI-stressed metro people, these towns are increasingly playing the role played by metros.

Khan seconded his opinion and agreed that a large portion of the contribution to the 400 million mobile phones comes from the non-metros. He added that there isn't too much of a divide between metros and non-metros these days. However, he highlighted a few key factors which need to be considered while talking about the non-metro markets.

"One of the most important factors to be kept in mind is that of infrastructure. This becomes all the more important when one is talking about a sector like telecom, which needs to look at increasing the number of towers for better coverage. These towers are treated like P&L accounts but the recovery is a big challenge. This is why, in this sector, even bitter enemies have come together to share towers, which implies that there are opportunities in this market.

"Another factor is the lack of a good distribution system, which can also prove to be a deterrent when it comes to the non-metro markets. Although people have tried several innovative routes, none of them have been very successful," says Khan.

Khan also spoke about the uncertainty in this market, which was again dependent on other factors such as monsoon and government interventions.

On the issue of creating brands, Khan was of the opinion that advertising agencies or communication professionals write communications for the small town consumers without actually visiting these markets.

Khan concluded by saying that decoupling was a very drastic term and he believes that the effect of slowdown will be there on small town India just like the metros, although the impact may be less.

Sanan of MCCS also agreed that because the population of non-metros is lesser than the metros, the resultant potential out there is less. However, he said that there is potential in the non metro markets, which had been the general consensus among speakers in the day's session.

However, Sanan added that the way of doing business in small towns is to be adapted and in times of slowdown, it's important to look at markets which would have otherwise gone unnoticed.

Citing an example to show that things do work at the regional level, he said, "Even after having a successful Hindi news channel, we went on to launch STAR Ananda and Majha, addressing the Bengali speaking and Marathi speaking markets respectively, and these have fructified, too."

According to him, the key lies in handling these markets differently. The communication strategy, media mix and activation initiatives for these markets should be adapted according to the regional levels, he feels.

However, Sanan differs from Khan's point of view when it comes to the infrastructure issue. This, Sanan said, is yet to be harnessed in the non-metros and lies untapped right now.

Sen from ZenithOptimedia made an important observation here. He said that heterogeneity also exists in metros as much as small towns. He gave a small example, saying that the earlier belief was that Mumbai could be reached though English newspapers and partly by Hindi. But today, to reach out to the SEC A in Mumbai, a Marathi daily is a must. The issue is how you interpret the data. When in a cosmopolitan market such as Mumbai you have to use a local language, it becomes important in other markets, too.

But lately, he said that regional media has seen a drop in retail advertising. So, one cannot say the problem is in new age jobs - it would be wrong. There is a slowdown and these markets are also affected. But in the current context of things, one needs to use the local media strategically to reach the hinterland consumers.

Chakraborti, musing about the acceptability of technology in the non-metros, put forward a question and asked the panel whether technology is adapted in non-metros any differently from the metros?

To this, Khan replied that the acceptability of technology has a lot to do with the youth and it is not that the non-metros don't have a considerable number of young people. "But in such a case, technology should be offered with its most tangible benefits. People in the non-metros wouldn't be particularly interested in the razzle-dazzle of technology - unlike the metro guys," he said.

Sanan also believes that if value added services are fine tuned and made region-specific, they will become very much acceptable among the non-metro population, too.

Chakraborti' next question to the panel was about brand loyalty in small town India. Are they really that brand conscious and if so, do they stay loyal towards a particular brand?

The panel agreed that in non-metros, the attitude towards brands isn't significantly different. However, Khan pointed out here that in order to convert these consumers, there shouldn't be a negative experience. He said, "Once the consumer has had a bad experience with the brand, he is most unlikely to return to it. Also, word of mouth information about the brand's negative experience will spread like wild fire and make it difficult for the brand to bounce back."

However, Khan was of the opinion that there is a sense of brand loyalty in small town Indians as they consume the same media as the metro consumers. Besides, there is a whole lot of migration from small town India to metros and back.

The discussion ended with the final question which Chakraborti threw at the panel. Is there a language divide when it comes to consuming media and otherwise?

Sen was of the opinion that English media brands, be it television or newspapers, play the role of national media and this is also why they get a larger share of revenue.

Sanan admitted that English channels do attract a certain amount of premium. "But expectations from English and regional channels is no different. The difference maybe in the type of content and value," he adds. Finally, he concluded by saying that despite the fact that most regional players offer a much wider reach than the English channels, it's unfortunate that we are ready to pay a special premium for the English ones because we are ourselves very metro minded.

First Published : September 25, 2014 04:04 PM

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