"Products don't compete with products anymore": Ravi Desai, Amazon

When an Indian goes into a saree shop, she makes the store-keeper empty out shelf after shelf on the counter top until there's a large heap of fabric in front of her. Of course, she's still not satisfied. A cup of tea and four heaps later, she looks at the exhausted seller - draped in three sarees himself, by way of demonstration - and says, "Bhai saab, aur dikhao!" As he empties yet another shelf for her highness, the customer sits back and inspects the material carefully. No one's surprised. That's just how we are.

Through its endearing advertising over the years, American e-commerce brand Amazon has tapped into this, and other such uniqely desi insights (read: "Kya Pehnu?", "Apni Dukaan", "We Indians love 'asli'", "We Indians love 'jaldi'", and most recently "Kitne Mein Mila?", to name a few). When in Rome and all that, yes, but Amazon, with a little help from agencies like Ogilvy and Burnett, took it to another level by exploiting insight after cultural insight and holding a mirror to the behaviour patterns that guide the way we Indians shop.

We spoke to the Bengaluru-based Ravi Desai, director, mass and brand marketing, Amazon India, about his product, its consumers, and the ecosystem both are part of. Desai, who joined Amazon in 2016, is a former ITC hand who spent over a decade marketing FMCG products at the company, during which time he handled brands across ITC's cigarette, paper and food categories.

Desai is credited with conceptualising and launching Bingo!, a chips brand that marked ITC's foray into the 'impulse snacks' market in 2007. He also helmed ITC's confectionery portfolio including brands like Minto and Candyman. Before moving to Amazon, he was cluster head of marketing and executive committee member of ITC's foods division.

Launched in 1994 by Jeff Bezos, the Seattle-headquartered Amazon launched Amazon.in - the Indian version of Amazon.com - in 2012-13. Presently, Amazon has close to 30 per cent market share in the Indian e-commerce category (Forbes, December 2018). Amazon's biggest rival in India is Flipkart, which also has similar market share.

Since the very beginning Amazon, not unlike its aforementioned rival, has been a prolific advertiser in this market; its presence across TV, print and digital media channels has been hard to miss, especially around sales, festivals and big ticket properties. It's not difficult to guess that the team sees merit in spending heavily on mass media. For instance, in 2015 the brand purchased some of the costliest slots during the IPL - close to Rs. 4 lakh for 10 seconds.

The Indian e-commerce marketplace is set to grow to $84 billion by 2021, from $24 billion in 2017. At present, 15 per cent of India's online population shops on dot coms; by 2026, the number will change to 50 per cent. Also, 75 per cent of the new consumers will land on the web, and eventually on online shopping sites, from rural areas (source: 'Unravelling the Indian Consumer', Deloitte 2019).

Edited Excerpts

First, let me talk about what hasn't changed - the fundamentals of marketing; they did not change. If you work hard to get customer insights, figure out a way in which you have a product or a service that can help unlock customers' needs, and then craft a campaign or an intervention that in some sense helps the customer understand how your brand, service or product is able to cater to her needs, then that's really what marketing is all about - those fundamentals haven't changed.

What has changed is the paradigm, in terms of the way one used to approach certain parameters of marketing.

So, we have all talked about the four Ps of marketing. Today, the 'place' is no longer just a physical outlet or a store; it is, instead, literally, anything on the internet. Therefore, the concept of distribution today is very different from what it used to be in the past. Products don't compete with products anymore.

Now, services compete with services and solutions compete with solutions. For example, the kids of today have an option to watch (a webseries like) The Grand Tour on Prime Video, or as an alternative, they can choose to go play (an online video game like) Fortnite or PubG. So it's online gaming versus streaming video content versus actually playing soccer downstairs - all of these are competing for an hour in the evening.

See, what has changed is the way in which the customer and the brand or service is experienced today. Therefore some of the paradigms around that have changed. But if the brand is hands down customer obsessed, working backwards from the customer as the starting point while building its service, then there is nothing to worry about this change.

What we have been observing for the last few quarters is that over 85 per cent of the new customers we see on Amazon.in are coming from outside tier I cities in India. Today, we have customer orders coming from more than 200 cities across the country. Almost 99.5 per cent of the serviceable pincodes in the country placed at least one order with Amazon during the last Great Indian Sale, which was held during Diwali.

Sometimes there are surprises, even - instances when the demand for products comes from remote parts of the country, from places where brands have not yet set up physical stores, from people who have not had access to branded products in the past.

So it is not a 'six metro' game or a 'top 20 city' game in India anymore, especially when you have technology as part of the product offering for your service.

Technology democratises reach. You are no longer dependent on the physical reach of your product, for instance, it's not about your product first reaching stores and then demand being created, and then people buying the product and consuming your service.

Rather, if the person is connected to the internet a whole host of products and services suddenly becomes available to you irrespective of where you are.

What we are learning is that some of the traditional ways of looking at customers in India continue to remain valid. But what we have done, vigorously, at our end is - we have crafted messages around the same theme, say, the original central theme (of a campaign), specifically for a region, like the South of the country. That's because customers here tend to expect the brand to speak to them and to make its pitch in a slightly different way than customers in the Hindi speaking markets of the country do. So that sort of a distinction holds true even in this paradigm.

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Gender is playing a role in a very fundamental way. The female shopper, at times, behaves very differently from the male shopper; she likes to browse the product a lot more whereas the male shopper's behaviour, generally, is something like - I come, I search, I buy and I am out. The female shopper likes to spend time... for her the whole shopping experience is critical, she likes to get a feel the product in some sense, and the interface matters more to her as well.

Younger consumers are more open to adapting to new technology and changes.They're also more intuitive when it comes to technology; they don't see tech as a big barrier. Older consumers, on the other hand, don't have the same level of comfort. These are some of the salient parameters one needs to take into account so that we can cater to all types of consumers very differently.

It also changes depending on the 'tenure' of the customer on the internet. If they've already been on the internet for many years, then they have a very different way of adapting to technology; they are far more experimental and far 'easier' when it comes to newer technologies and solutions. But if the person has just started using the internet then he or she has a slightly higher lever of apprehension.

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The key question for us is 'What is the customer set that I am likely to reach through a particular platform around a particular event?'... for example, the online content consumption we're seeing is a great way for us to tap into customers who we think would be the right people for Amazon Pay adoption. Thus, we have a fairly large plan built on the back of IPL viewership patterns on Hotstar.

On television, however, we are using the IPL very differently. There, we are trying to talk to customers for Amazon.in. We want them to start their online shopping journey with us.

Each of these platforms gives us different opportunities. Understanding what the customer set across each is and how you want to pitch your service or brand to them is helping us leverage these opportunities for the benefit of the brand.

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Well, I would say it's a classic situation of verticalisation versus horizontalisation. It's not something peculiar to agencies or brands or clients or anything like that. I think it's just physics being applied to the agency ecosystem: the more horizontal you go the less specialised you can be, but you cover more surface area. The more vertical you go the more super-specialised you can be, but you cover less surface area.

You now have a bunch of good vertical specialists who work on a very narrow solution but do it well. Then there's a whole host of horizontal agencies that don't go too deeply into anything but can actually give you an end to end picture of what will work for the customer in a certain situation. It's horses for courses; I don't see one type of agency as better than the other.

(This interview was first published in our magazine afaqs!Reporter on April 15, 2017)