Infographic – India expenditure data (urban)

This infographic kicks off a set of posts that will delve into various aspects of income and expenditure distribution in India. This one describes the proportion of expenditure spent on various categories.

India MPCE - expenditure data

The pie chart on top shows how the average monthly expenditure per capita gets divided over several categories. But, as we all know, averages can be misleading. Hence the line chart below that shows how the percentages vary for different fractiles of the population.

The pie-chart clearly shows that food is the single largest component of the average expenditure basket, at 38.5% of the total average monthly expense per capita. What is even more interesting to see is how the proportion of expenditure on food varies with income, this is explored in the line chart (with expenditure fractiles being the proxy for income). The poorest 5% have a per capita monthly expenditure of Rs. 700.5; for this segment, expenditure on food is over half their total monthly expenditure. The richest 5% , on the other hand, spend only 23% of their monthly expenditure on food.

A similar trend can be seen in a few other categories, one of them being fuel and power. While on an average, the spend on these is 7.6% of total expenditure, it comprises almost 13% of the monthly expenditure of the poorest. As a proportion of their total expenditure, they spend more for electricity or cooking fuel than the richest do.

Many other nuggets buried within this infographic, but I’ll leave it to you to discover those ; we’ll be back soon to explore another facet of income and expenditure distribution.

  • Ravindra Ramavath

August 19, 2015 at 11:13 am Leave a comment

Digital Marketing for the ‘Old World’ Marketer

Digital marketing is where the action is at, and if you’re a skeptic, and still struggling to catch up with CTR, SMM, Open rates, and all the rest; the world seems to be busy telling you that you’re lost.  Some thoughts to put digital marketing in perspective, and help keep you in the game:

 

Digital marketing is a misnomer

It’s many wonderful things, but not marketing. Marketing is the 4P’s, 7P’s, or creation of the value chain from producer to consumer (of product/service ), or whichever definition of marketing floats your boat.  ‘Digital marketing’ on the other hand is a tool of communication and engagement.  It’s a “How” (one of many) to communicate “What” you want to say to your target audience.  That actually sounds like…

 

Advertising

“A rose by any other name…” The great bard tells us that a thing remains what it is, irrespective of how one may choose to label it. If it walks like a duck, quacks like a duck, it is a…  And all of you know what makes great advertising – insight into your consumer’s behavior and attitudes, clarity of your objective, how the consumer should feel, a bit of serendipity, and so on.  Digital marketing is exactly the same.  If you’re selling airline tickets to global citizens, smart alec tweets about who won a FIFA World Cup game which are viewed by millions, but annoy a few thousand (potential) customers is poor advertising – as KLM quickly realized.  No matter how much your digital agency will jabber on about engagement levels, viral videos, ‘likes’, or “how the digital audience is different”; the essence of what makes great advertising will remain.

 

“Lies, damned lies and statistics”

The inherent nature of the digital world means everything is made of numbers (queue the scene from “The Matrix” when Neo discovers his true ‘power’). And so the new age digital marketer will bury you in reams of numbers – CPV, CTR, CPA, session time, funnel %, and on and on; and build them into beautiful decks with wonderful graphs.  Don’t let them stop there, and ask what do the numbers mean – how are consumers reacting; understand, why are they doing that?  Be careful that the data is consistent, and not cherry picked, lest Mr. Disraeli rise from the grave and lecture you.  And always remember, don’t derive qualitative answers from quantitative data or vice-versa

 

Watch your spend

You don’t spend without thought and analysis on television or print or radio, why is digital marketing any different?

 

Don’t be afraid

One huge advantage ( or nightmare, depending on your POV ) of the digital world is how fast things can be changed, and how quickly the past can be wiped clean ( at an ordinary, superficial level ) – so use that and experiment !

  • Sujay Naik

( Note : This post was originally published by Sujay Naik on linkedin and is being reproduced here with his permission.)

July 30, 2015 at 7:33 am Leave a comment

From No-No to Yes-Yes

 

NanoTwist

I’m generally indifferent to cars and know them only as a system with four wheels, steering and seating that get me from point A to point B with minimum effort on my part; yet I’m eagerly awaiting the launch of the Tata Nano GenX. The journey of the Nano has such interesting twists and turns that it rivals a Bollywood potboiler, and as a student of marketing, I really want to see how Team Nano manages the tough task of making consumers warm up to the Nano Gen X. ( I’m hoping it succeeds and wishing the Nano Best of Luck, by the way). Meanwhile, in the run-up to the launch (until I have fodder for another post, that is), here’s the story of the Nano thus far :

Phase I: The people’s car The 1 lakh car

Launched in 2009, the Tata Nano was supposed to be ‘a people’s car’, the savior of the Indian middle class family which relied on a scooter or bike to transport all four members, offering them a safer and more comfortable alternative. To ensure affordability, the initial price was brought down to as low as Rs. 1 lakh per car through frugal innovation. Watch this ad to get a taste of what this brand was supposed to stand for and the role it was expected to play.

However, most of the hype around the car was focused on its cheap price and it became known as ‘The 1 lakh car’. For the middle class, both urban and rural, owning a car is a matter of pride and self-esteem. So, rather than gladly discovering that this fantastic upgrade from a two-wheeler actually had a reasonable price, Nano’s portrayed image put the product in the situation of being viewed as a compromise , not an upgrade.  “Ek prestige view se thodi down hai,” as one respondent expressed it during a transportation related research a few years ago, while another respondent termed it ‘the No-no’. Dangers of letting a low price be the defining feature of your offering!

Mr. Ratan Tata gives a crisp explanation in this article , “I always felt the Nano should have been marketed towards the owner of a two-wheeler because it was conceived to give people who rode on two-wheeler an all-weather, safe form of transportation, not (the) cheapest,” Tata said. “It became termed as the cheapest car by the public, and [also] I’m sorry to say, by the company when it was being marketed,” he added.

Another problem that the Nano faced was that of high expectations from those who did see it as an end to their transportation woes. During the same transportation related research mentioned earlier, we also found that the same Indian family that would uncomplainingly seat four people on a scooter or bike and balance their shopping bags too, somehow morphed into a demanding set that wanted adequate boot space in their car to keep luggage – just in case they had to drop a relative to the station.

The performance problems with the initial batch of cars did nothing to boost Nano’s image either. Soon after the cars hit the road came reports of some of them catching fire, which was seen as an indicator of low quality and a lack of reliability. While only a few such issues were reported, we’ve found that some people still mention these spontaneously when the Nano is mentioned.

Phase II:

Here’s where the change begins and the marketing team begins explicitly targeting a different TG –  young professionals in urban centers ; you can click on the links here  , here and here to view the ads and see for yourself  the distinct change in tone and style of ads from the earlier people’s car ads. By now, the no-frills car also had some add-ons such as the ‘best – in –class A.C.’ mentioned in the print ad shown below.

nano pic 3

 

Phase III :  Launch of Nano Twist – from ‘cheap car’ to ‘smart city car’

This is when an attempt was made to radically alter the Nano’s positioning in order to make it appeal to the new TG of urban professionals. The ‘you’re awesome’ campaign targeted  young urban folk and tried to showcase to them the new stylish Nano – new colours, better interiors, a car that could seat a couple of friends , a fun n’ smart car to hang out with. Did it work? I recall discussing this campaign and its effectiveness with a young colleague early last year and she felt that it was having some impact, two of her friends had noticed the ad and actually purchased the Nano Twist. Multiple news reports also mention that the customer profile for the Nano had indeed changed over the years, a heartening sign – the proportion of Nano buyers in the 24 -34 years age bracket had expanded to 40 percent, from the earlier 15 to 18 per cent.  Another interesting change happening in the Nano script is the growing base of women. Today, they account for 28 per cent of its customers, a substantial jump from 12 per cent in the earlier ‘people’s car’ phase.

That’s only part of the story though; take a look at the sales data for the rest – as per this article, in the April – December period of ’14-’15, Nano only sold 13,333 units, down 18.64% from the same period of ’13-’14.  

What could have limited the impact of such a high decibel campaign? NanoTwistWell, one reason could simply be that the impact of the initial launch advertising and PR campaign in ’08-’09 was so strong that the ‘cheap car’ story could only be over-written over the long haul , and it’s not a task that one ad alone could shoulder. Another could be that while the ‘You’re Awesome’ campaign did have a smarter , more stylish feel to it, there was no over-arching product story communicated about how the Twist was better than the earlier version of the Nano, neither about how it was better suited to city travel than other cars. While some shots in the ad did imply easy maneuverability, it was not explicit enough, and got overshadowed by the messaging on style and aesthetics ; the ‘smart city car’ benefits were explicitly mentioned only in print ads. When a repositioning as drastic as this one is being attempted, consumers probably need to hear that the car has improved significantly too.    

Phase IV: Launch of the Nano Gen Xnano pic 2

And thus to the eagerly awaited launch of the Tata Nano Gen X later this month! Now clearly aiming for the ‘smart city car’ tag, the Gen X has a host of improved features, see details here here and here

But has the 2013 campaign succeeded in erasing memories of the 1 lakh car launched in 2009? Will the Nano get to make a fresh start? Only time will tell…  

 

  • Zenobia Driver

May 14, 2015 at 10:57 am 4 comments

Why Snapdeal sponsors Big Boss, and Flipkart / Pepperfry / Fabfurnish / Jabong / Amazon etc. advertise on mass media

The sudden surge in e-commerce firms advertising on mass media has surely not gone unnoticed by readers of this blog. While Flipkart has been advertising on TV for a few years now (read our posts on their ads here  and here) , in the last few weeks every e-commerce firm (with deep pockets and / or investors) has jumped on the bandwagon. Switch on TV and ads for Pepperfry / Fabfurnish / Jabong / Amazon etc. appear as often as those for soaps, soft drinks and biscuits ; drive on any major artery in Mumbai and alongside posters of political parties that contested the just concluded state elections you’ll find those for Pepperfry.com ; print media has been used extensively too with some players even splashing their ad on the front page.

Of course, with the Dussehra – Diwali festival season approaching, one would expect any retail venture to step up promotions and advertising, we see almost all brands and supermarkets doing so too. But what drives the young e-commerce firms to advertise on mass media ? Surely they’re masters of advertising on the internet and on social media, which are not only cheaper media, but allow the brand to fine-tune targeting their audience in a manner that mass media simply cannot match. So why spend big bucks on a (relatively) scatter-shot approach when you have a finely tuned laser at your disposal ?

Ah, take a look at the results of the same. As per this news report, Snapdeal’s sponsorship of the popular teleserial ‘Big Boss’ resulted in them recording highest ever sales. This article quotes Vikram Chopra, CEO and co-founder of FabFurnish, “During and after a few months of the television campaign, our traffic increased two and half times.” And I’m not even getting into describing Flipkart’s Big Billion Day sale, as the furore afterwards has ensured that everyone knows all about the record number of prospective customers that logged in on the day. Would advertising on digital and social media alone give e-commerce companies the same outcome ?

One simple fact can help answer this. Amongst the Indians who are active online, a low proportion actually shop online; we gave the data related to this in a post a few weeks ago. For instance, in Russia and China, almost half of the population that are active online also shop online ; whereas in India this proportion is a little less than 10%.

pic - infographic and e-commerce firms' logos

There are various reasons for this. Firstly, the number bandied around as the number of Indians that are active online includes even those who access the internet infrequently. As this post shows , in the top 35 cities which account for 42% of Active net users, only 54% access the internet daily. The All-India figure for percentage of active internet users who access the net daily is much lower.

Now, layer this with the fact that a significant proportion of sales for e-commerce firms are from tier 2 cities, and you see the importance of getting their residents transacting online. The best media for targeting these markets is still TV. As this article mentions Snapdeal CEO Kunal Bahl saying during a conference, “All e-commerce companies want to penetrate the tier-II market and Big Boss is a great medium for that.”

Hence, the necessity for e-commerce firms to advertise on mass media and attract more people onto online media, simply advertising on digital media just won’t suffice as not enough people are active online.

  • Zenobia Driver

October 20, 2014 at 6:36 am 3 comments

Fun, facts and #PhotoshopRF

The Escape Velocity team decided to join in the merrymaking over the #PhotoshopRF tweets (click on this link for some amusement) with some tweets of our own yesterday. Only, we put our own spin on the advice to Fedex by adding some facts to the snaps too.

For those of you that are not on twitter, here’s our contribution to the advice to Federer on which places to visit, along with some back-up data :

Rural-Internet

 

 

Rural-MobileFemale-Enrollment

 

  • Ravindra Ramavath

(with assistance from Poornima and the Design Orb team)

September 27, 2014 at 2:42 pm Leave a comment

India – Internet Statistics

India-Internet

Since we’ve received some questions after the last two posts, we felt that it was time to share some more data on this topic. As this info-graphic is quite detailed, we may write a post or two on some of the implications of the numbers in this one , but you’ll have to wait a week or two to read those.

  • Ravindra Ramavath

 

September 9, 2014 at 5:52 am Leave a comment

Internet penetration and the proportion that shop online – a comparison across four countries

After last week’s post on segmentation in the apparel e-tailing space, we thought we’d share some information on internet penetration in India and the proportion of the population that makes purchases online. To make this more interesting, we decided to compare the data across four countries, and represent this in an easy – to – understand graphic.

 

India-Internet-2

 

 

 

 

 

 

 

 

 

 

 

 

  • Ravindra Ramavath

September 5, 2014 at 12:19 pm Leave a comment

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