Brand building on the Net still viable

Internet punters are an inveterate lot. Despite last year's great dotcom bust, these optimistic folk continue making estimates of how and when things would start looking up for the 'Net industry'.

But it would be foolhardy to dismiss this optimism as blind faith - nothing can be farther from the truth. In fact, in reality, the Internet is, perhaps, in phase two of its lifecycle, and all set to turn the corner. As George Zacharias, chief operating officer, Sify.com, rightly says, "The Internet was incredibly over-hyped last year, and now is incredibly undervalued. Bubble or not, the Internet is here to stay." And if the Internet is here to stay, so are branding opportunities on the Net.

There are grounds for this optimism, of course. The Net, as a medium, has been growing consistently, and NASSCOM estimates that by 2003, the number of Internet connections in India will grow to 10 million, from the current 6 million. And as per a NASSCOM-McKinsey study in 1999, India has the potential to earn revenues worth US $10 billion by 2008 from e-business solutions (from both the domestic and export markets put together). And despite the recession, in the last quarter of 2001-02, software and services exports from India generated revenues of Rs 9,100 crore, up 25 per cent over the Rs 7,270 crore for the corresponding period in the previous year.

And the reach of the Internet can never be discounted. NASSCOM estimates that 75 per cent of Internet users in India are from the Top Ten towns, that they are young (in the 18-to-35 age group), that 75 per cent are male, that 66 per cent are graduates, and 40 per cent students. And most importantly, for marketers, most are from SEC A. But what ought to catch media planners' attentions is that most Internet users come under what the trade calls, 'innovators and early adaptors'. "The mistake with cost-per-1000 media planning is that it does not take the innovators and early adopters into consideration," points out Vivek Bali, president, portals, Sify.com. "These categories have much higher per-capita consumption of products."

Media planners agree that effective media planning must take into account not only demographics, but also psychographics and the tendency of the target groups to actually try out something. "It is a pity that the Internet has become associated with banners," says a senior media planner. "The medium has tremendous potential, with advertisers able to reach out to their target audience at both the Point of Movement entry and the Point of Internet Entry. Brand Equity must get involved with the Net."

So it's time to look at the Net as a serious branding tool. And companies are already doing so - with favourable results. One of the early movers is Asian Paints - ironically, a pure brick-and-mortar company. And the company's experience with its web page is revealing. In 1997, Asian Paints created its first web page. Looking back, P.M. Murty, president, Decorative India, Asian Paints Ltd, admits that the first web page was "embarrassingly self-congratulatory".

"What we realized was that dazzle was completely out, and that consumer promotion was in," he says, summarising the lessons learnt by the company. Research indicated that the best targets for the company were what it called 'PPPs - People Planning to Paint'. These people raised their hands, in a way, by visiting the company's site in search of information and services. Based on this, Asian Paints created their web site to provide pre-painting information and after-sales services. For one, speed of response to e-mail was crucial.

The new strategy - a focus on convincing PPPs online, allowing them to purchase offline, and following this up with Customer Relations Management (CRM) through prompt responses to e-mail and the posting of discussion groups - seems to have worked. According to company figures, e-mails to the company web site have gone up from 483 in the first quarter of 2001 to 2,789 in the last quarter. "Paints are typically a low-involvement category, and come under the broader category of home décor, which is a high involvement area," says Murty. "We realized that PPPs were receptive to our communication, but as part of the broader category of home décor."

Another area where the Net has strong advantages is promotions. For example, consumer information exchange portal MouthShut.com and Prizes2B1.com, a contests and promotions company catering to Indian Net audience, have pooled their resources whereby MouthShut's expertise in providing feedback and surveys are complimented by brand promotions on Prizes2B1.com. The alliance means that companies can now obtain feedback as well as promote their brand at the same time. "Companies can find out what their customers think about their products and services from MouthShut.com," says Faisal I. Farooqui, CEO of Virginia, USA-based MouthShut.com Inc. "We provide several tools to corporations to help them understand their customers and prospects better."

In 2001, AOL posted an online retail trade of US $33 billion - one seventh of the retail trade in the United States. And if India follows the US - as it has tended to do in most IT-related scenarios - soon, how marketers promote themselves on the Net will be as crucial as the 10-second commercial that television audiences may be busy zapping. © 2002 agencyfaqs!