the state of digital marketing in b2b in india

WWW India

The state of digital marketing

in B2B in India November 2012

The State of Digital Marketing in B2B in India

Intro

The state of digital marketing

in B2B in India

For the past two years, Omobono has conducted WWW in the UK with input from our clients in

Europe and the US.

But the world is changing, and the requirements of many global corporates to spread their

marketing efforts into BRIC countries means that we need to know whether the things we hold

true as marketers in the West are held true elsewhere. Is there one universal way or not? If

there are differences, what are they?

Omobono set out to find answers to these questions by extending its What Works Where study

to India in 2012.


What Works Where in India

As anyone who has been to India will know, it’s another country; they do things differently there. In fact it is, in our opinion, not one India but 3.

There is the simple fact of the numbers. 1.2bn people, of whom 120 million (around 10%) are internet users (Source: Economic Times of India, April 2012).

But 500 million people are below the poverty line, they are barely literate, with no access to the internet at all. That’s one India.

Another is the establishment India, where traditional bureaucracy and systems associated (and partly left by) the Raj still operate. This is an India where everyone has their place and in order to get ahead you have to know the right people (e.g. be a member of the Delhi Golf Club). As we will see later, one of digital’s great challenges in India as in other markets, is how to augment these personal relationships, not to try to supplant them.

Then there’s new India. With a new professional class and 600,000 people graduating in technology subjects from India’s excellent Universities each year, India is provoking deep interest from global corporates, who have headquartered in the new towns that have grown up around Delhi, like Noida and Gulgaon, which simply didn’t exist 25 years ago. And of course similarly in Mumbai and Bangalore.

But with over 50% of the population under 35, this is the India most people are now growing up aware of.

In the digital landscape it’s this third version of India which is most relevant. But any plan has to take into account India’s 1 and 2 as well, depending on the business sector you are targeting.

The state of digital marketing in India

The simple fact is it’s pretty undocumented.

The internet is transforming lives in India but the way that it is being used by businesses to communicate with other businesses is, as yet, unknown. As our literature review conducted as part of this project tells us, our survey is the first time anyone has looked at the topic. So there’s much to learn.

Findings

We’re all familiar with the Google stat that says that 95% of business purchases start on the web. Whilst not as high, that point of view is certainly supported by our own WWW research which cites search as being the start point for over half of the audience.

So perhaps it’s no surprise that in the India survey too, 86% of respondents felt that digital was critical or important.

As we’ll see later, the most important digital elements were web, search and social - the three broadcast techniques which help businesses span this massive continent.

Over the next 12 months digital spend is set to continue, with the majority of the businesses surveyed committing 10 – 30% of their budget to digital, with a small group (10%) some committing as much as 70%.

In the UK and other markets the mean is more like 40%, so digital’s share of the marketing wallet in India lags slightly behind.


Marketing priorities

The top three marketing priorities from the mean scores were:

developing a brand position deepening customer relationships lead generation.

Ensuring the organisation is living the brand and building brand awareness are close behind however. This is unlike in the UK where bringing the organisation along with you on the marketing journey is just not on marketers radars.

Interestingly, this priority list does not change according to company size, again unlike in the UK, where building thought leadership (which is the third most important priority) overtakes building brand awareness to become the second most important priority for larger companies.

What do we read into that? That Indian B2B marketers have a better understanding of the importance of lining up everyone within the organisation behind the brand or that they just don’t have a separate resource to handle this, so it stays with the marketing community. And, probably, that in a market of the size of India, awareness is still the key game to be played, as opposed to saturated mature markets where the names of bigger companies are known and telling the difference between companies is harder.

Digital channel priorities

As we found in our UK study – and as might be expected, websites are the backbone of companies’ digital presence.


Unlike here though, where search is underinvested in (despite buyers being highly reliant on it), SEO comes up as the second most important digital channel in India, whilst social media overtakes email as the next most important marketing tool. Again this seems to point to the fact that in a market the size of India it’s more realistic to try to ensure that your customers find you than to market to them directly – particularly as data in India is still a nascent business.

This seems to be backed up by the fact that the only people who were using email were the larger companies – who perhaps have a more email orientated customer base.

Small companies seem to be underusing this channel. Perhaps data is at the heart of this problem. We’re not sure it’s as extreme as one digital pundit’s comment that ‘all databases in India are stolen’, but clearly for email marketing to be widely used you need the data.


From What Works Where in B2B? 2012

Perceptions of effectiveness - what works in India?

As might be expected, perceptions of effectiveness follow usage, with the most frequently relied on channels being the ones that people think work best.

Here there were some differences in terms of the size of company, with larger companies favouring intranets (presumably because they have them) and the biggest being strongest promoters of mobile.

Given that 98% of our respondents’ marketing teams were under 40 and the stats on mobile usage, mobile’s appearance at the bottom of the range is interesting. The number of mobile phone subscribers in India rose to 929.37 million in May according to the Telecom Regulatory Authority of India.


However, perhaps it only suffers in comparison to other channels, because overall, the levels are comparatively high. A third of the respondents use mobile channels, and 42% feel mobile is effective.

This suggests a higher engagement level with mobile compared to the UK, where only 7% of budget is allocated to mobile, and perceptions of effectiveness peak at 24/25% (for optimisation and apps respectively).

In India, looking at where effort is likely to be invested over the next 12 months mobile looks to continue its role as a support channel, whilst over here mobile is felt to be the critical business tool.

As one recent stat that Google shared at the BMA UK conference in October 2012, ‘57% of business users who have a bad experience of a corporate website on mobile would reconsider buying from that company.’

Twitter statistic from the BMA UK conference in October 2012

Challenges and resource – the vicious circle

Indian companies do more of their digital marketing in house.

In comparison with the UK, where only a third of work is handled in house on average, in India 50% of companies handle the majority of their digital work in house.


A mere 20% mostly outsourced digital work and this tends to coalesce around paid search, SEO and audio, video and interactive marketing activities. There are some dissimilarities between the size of company and what they outsource, as can be seen on the chart to the left.

At the other end of this telescope however, as highlighted in the main challenges facing B2B marketers, this tendency to retain things in house creates pressures which need to be managed.


As can be seen from the previous chart, the most significant challenges is measuring ROI. But the next two relate directly to the quality and availability of resource, followed by two others which also relate directly to resource. So 80% of the audience cite challenges which are resource dependent.

Interestingly, lack of technology did not seem to be an issue in the Indian market, with only one in in 8 putting it as their top 3 issue and only 1% saying it was their top priority. In other words, the plumbing exists; it’s what goes through the pipes that is creating the problems.

Indian marketers believe that they are in a fast moving environment, with most companies citing speed and innovation as a significant challenge. In the UK the issues are the same.


And beyond digital?

India is in many ways, a very traditional market, where who you know is as important (or even more) than what you know.

As the chart to the left shows, this means that although digital can contribute much to marketing practice, face-to-face still cannot be ignored.

This is similar to the findings in B2B in other markets. The preferred way to do business is about meeting people face to face and making a judgment about whether you can work with them.

In our UK survey 36% of B2B buyers said they were more likely to buy as a result of face-to-face contact.

This does not mean however, that digital cannot play a really significant role in the buying process, as this UK chart on the top right shows.

The challenge, or opportunity, is to make digital work hand in hand with face-to-face contact, augmenting the interaction by inviting, sharing and reaching out to people at other times.

Buyers react most positively to digital content tailored to their requirements.

Measuring effectiveness

Indian marketers cut to the quick. They look for lead generation statistics to drive their digital judgments, using web analytics, brand awareness and sales to add to their ROI arguments.



What’s interesting however is that the two most effective techniques are non-digital channels, face to face and customer referrals, and these cannot be measured on digital ROI metrics.

Perhaps ROI’s inability to capture the things that really influence business success is the reason that over half the respondents are dissatisfied with the accuracy of their ROI measurement.

Implications

There is much that global marketers can learn from this study. At the core is the same message we discovered elsewhere, that the basics – web, search or social are all critical channels in the Indian market.

Email seems to be an underused vehicle and therein lies an opportunity for those companies who can dedicate the resource to finding the data.

As one CMO stated at the London BMA conference in October 2012, “In India there is no data. I have people walking down the streets with notepads making a note of the company name.”

Finally, remember one of the other startling facts about India is how young it is demographically. People under 35 account for over half the population and this will grow. This is the digital generation. India is the 2nd biggest Facebook nation on the planet.

Before too long, they will come into business, increasing the normalisation of digital channels in relationship building as well as more traditional broadcast techniques.

And this brings us to the final challenge for India – which is to work out how best to use digital to augment the other ways in which people do business, in particular personal relationships and customer referrals. In our view, building an approach which uses digital mechanisms to engage customers on an on-going basis is at the heart of how to do this.


Given the importance of who you know in India harnessing the power of recommendation via digital could be a game changing strategy. Companies that can do this effectively are set to win.

How we conducted it

The study of the Indian B2B digital market place was undertaken in partnership with Durham University Business School, whose MBA students undertake embedded business projects as part of their end of study dissertations. Our research was conducted by Kiran Ramakrishna, now Business Development Manager to ISEA plc. in Paris, to whom we extend our thanks.

Kiran worked with us to develop a questionnaire pertinent to the Indian market place, build the online survey and ensure a high quality response sample. His subsequent analysis of the data, using research techniques including Kruskall-Wallis and T-tests mean the findings are extremely robust.

As anyone who has worked with a top class business school will know, it’s a great experience to have a first class brain working with you on a business project. We highly recommend it.


Thank you

For further information on the research or on how Omobono can help you tackle the challenges outlined please contact: Francesca Brosan on 01223 307000 or email [email protected] For further information about Durham University Business School, visit: www.dur.ac.uk/business

© 2012 Omobono Ltd.

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