Brand engagement has traditionally been neglected by Indian brands. Few understand the need to engage with the stakeholder at a deep level, over a sustained period of time. Fewer still know how to go about it.
A cursory look at the brand strength assessments of a cross section of Indian brands confirms this. Almost all of them—from the largest conglomerates and B2B brands to giants in the telecom, FMCG, automotive, banking and consumer durable spaces—have consistently low engagement scores. The Best Indian Brands, in fact, score an average of 4.5 out of 10. Compare this to the global average (represented by the Best Global Brands) of 6.5, and it’s clear that engagement is a neglected factor of brand strength amongst Indian brands.
Our research into Indian brands across industries—including conversations with leading CMOs—reveals the top reasons for a lack of engagement in India, which will serve as a foundation for finding solutions:
The reason engagement scores are low amongst brands in India is perhaps as much due to inherent structural issues with the market as to a lack of appreciation. However, there are compelling reasons that India is becoming fertile ground for engagement:
The consumer capital and rising social saturation: India is currently the largest market in the world, and increasing spending per capita makes our economy more attractive for long-term growth prospects. Hence, in markets like this, the continuous building of brand loyalty and advocacy through some of the most populous social networks will play an increasingly important role. While digital infrastructure is still growing in India, the social presence is rising. Brands have a chance to get ahead of the curve by reaching vast audiences where they’ll be in the future
Evolving demographics in India: The Great Indian Middle Class is seeing increased discretionary spending, driven by the increased disposable income. Indians are no longer “Brahminical” in their approach to spending and are increasingly choosing to consume. This presents immense opportunities for brands to engage in deep, meaningful conversations with customers on an ongoing basis, which will keep them top-of-mind when those purchase decisions are made.
Growing affluent class demanding exclusive attention: The luxury market is projected to grow 2.5 times its current size in the next five years. The purchase of luxury cars in India has increased, despite the economic slowdown in 2017—with first quarter growth at its lowest since 2014. High purchasing power is also evident in the affluent class through significantly increased smartphone usage and spends on eating out.
As the rich get richer, they are also getting pickier about where they spend. Given the multitude of options available, presence alone might no longer be enough. Brands now need to work harder to engage more deeply with customers, stay relevant, and be the preferred choice.
Getting savvy consumers to stick with you: The middle class—which constitutes nearly 65% of the total consumer market—is highly value-conscious. Catering to this significant target group has led to widespread democratization and discounting—two of the biggest success-drivers in the market. Fostering engagement amongst this finicky group may be a strong way of restoring some lock-in and loyalty, which can be a stabilizing force for brands amidst the uncertainties of an evolving market.
The engagement opportunities: Despite the plethora of challenges, it’s important to pay attention to growth trends in India. There are certain “hero categories” in which engagement is the key growth driver, as brands are more critically expected to design their experiences around customers and deliver personalization. The best bets for engagement strategies lie in the sectors in which the customer segments are of higher value and thus there is a business case for investing in engagement. Luxury goods and services, HNI wealth management, high-end hospitality, and gems and jewelry are all sectors in which early adoption of an evolved engagement practice is crucial. However, all brands would be wise to stay ahead of the growth curve: The upward mobility of the consumer class and democratization of the market are rising forces that will push this practice into all sectors—making “connection” the source of growth for businesses and brands throughout India. Forging stronger connections in the world’s most populous nation will be a happy fillip to its celebrated heterogeneity and drive the evolution of society at large.