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Experts Speak: Marketing budgets in 2024 to consider technology and hyper-personalization

GroupM India’s This Year Next Year (TYNY) report suggests that the overall ad revenue in India is expected to reach INR 1,55,386 crore in 2024, with an incremental INR 14,423 crores compared to 2023, growing at an estimated 10.2%.

With this, the marketing budgets are expected to keep technology and hyper-personalisation in focus as per experts.

Ayaesha Gooptu, Head of Domestic Brown Spirits, Bacardi India says that transcending traditional tactics that are typically measured in concrete metrics like ROI, forward-thinking marketers are set to embark on a year of unprecedented experimentation, exploring tech-oriented, hyperlocal, and hyper-personalized approaches that will be key to fostering stronger loyalty, deeper connections, and delivering breakthrough growth this year. 

Gooptu continues, “Growing in tandem with India’s increasing appetite for these unique and immersive experiences, marketers are set to make a deeper foray into crafting immersive experiences using AI, AR and VR technologies – strategically driving investments in realms that are bound to capture the attention of modern consumers this year.”

She also mentions that brands that are already embracing experiential marketing are reaping substantial rewards, reporting significant boosts in sales.

We further speak to marketing executives from different domains on the marketing budgets planned with the mediums and trends that will affect the allocations as they provide tips to navigate the budgeting system.

Marketing budget

When it comes to auto companies like Maruti Suzuki, the marketing expenditure is anchored in a funnel model that is meticulously designed to optimize the brand’s marketing synergies.

Shashank Srivastava, Senior Executive Officer, Maruti Suzuki India Limited states, “Overall, our advertisement budget is INR 1000+ crore that is spread across these different funnel stages. There will be a likely increase of around 15%.”

Srivastava highlights that rural markets contribute to around 45% of the brand’s overall sales, and this underscores the importance of tailoring media strategies for rural consumers by leveraging relevant platforms accordingly.

Srivastava goes on to mention the brand concentrates its efforts on the introduction of new products and brand building in the initial phase. This is followed by a dedicated initiative to maintain the momentum of our current product portfolio. They engage in the management of the corporate brand narrative, ensuring alignment with the strategic objectives, following which the final phase focuses on tactical support.

According to Shivam Ranjan, Marketing Head, Motorola APAC, “The industry spends will continue to over-index on digital media in 2024, with eCommerce platforms and video-led platforms taking a larger share of the pie versus previous years.”

The electronics brand is growing with a strong double-digit premium to market in India and Ranjan suggests that the marketing investments will also see a similar growth. 

“The additional investments will see a skew towards new age digital media and formats such as short format video content, influencer content, live commerce and eCommerce display & search investments along with hybrid media such as DOOH that deliver better ROI and targeting versus traditional media,” Ranjan continues.

Moreover, AI-led marketing investments both from a communication development as well a media perspective will be a key area of focus for the brand along with IPL and elections serving as high-impact events this year with overlapping timelines. 

According to a recent Goldman Sachs report, 100 million people in India will become ‘affluent’, and earn an annual income exceeding $10,000 by 2027 from the current 60 million people. The country’s consumer market is set to become the world’s third-largest by 2027.

With this, Deepa Krishnan, Head – Marketing, India and Southwest Asia, Hyatt India Consultancy Pvt Ltd. comments, “The marketing landscape is poised for dynamic shifts in 2024, guided by a strategic blend of data-driven insights and shifting consumer trends.”

Krishnan further continues, “There will be a notable increase in marketing budgets, reflecting the country’s growing affluence, strong GDP growth and burgeoning Gen Z and Millennial population, coupled with robust mobile and social penetration.”

Media plan

As the hospitality industry notes a shift, so does travel as a category. With Gen Z having the purchasing power now, it’s important to reach them through the channels they spend the most time on.

Kunal Dubey, CMO, Cleartrip mentions the online booking brand has always positioned itself as a digital-first brand. 

Dubey says, “Therefore, this medium will remain our primary channel, with over 70% of our budget allocated to it. Even in the case of television, Connected TV (CTV) emerges as our primary choice, where the screen size is influential but within a digital context.”

He comments that the brand will persist in utilizing print for specific markets and key campaigns effectively and employ television as a traditional method during key spike periods.

Similarly, Nalin Jain, CMO at Godrej Capital says that in the current marketing landscape, digital mediums are expected to dominate spending, particularly on platforms like social media, search engine advertising, and online content promotion. This shift is driven by the undeniable influence and reach these channels offer in modern times.

Jain notes, “Social media, with its vast user base, targeted advertising options, and interactive features, is a powerhouse for brand visibility. Search engine advertising also ensures businesses capture intent-driven audiences actively seeking products or services. Additionally, investing in online content promotion enhances engagement.”

While digital takes the lead, Jain also believes that traditional mediums like print and radio still command a share, catering to diverse audience segments. With their mass appeal, traditional channels remain vital for broad brand exposure and maintain relevance for niche markets and specific demographics.

Maruti Suzuki’s Shashank Srivastava says that the brand follows an omnichannel strategy to offer a unified brand experience across every customer journey, including print, OTT, TV, digital, OOH and radio amongst others. 

“We anticipate increased spending across TV and OTT platforms to strengthen the upper end of our marketing funnel. Last year, we successfully launched several new products, and this year, we have an active pipeline of products planned for the market.”

Additionally, OOH and DOOH advertising and Cinema gain advertisers’ interest as well, according to him.

This is mainly due to the advertising and marketing trends that will define 2024 for the auto sector. Srivastava expects OTT and digital spending to increase with Maruti Suzuki spending more on TV platforms and OTT as the brand will focus on boosting the upper-end funnel and building desired brand perception and imagery. 

Trends that will affect budgets

When it comes to technologies and trends like AI, AR, and VR Cleartrip’s Kunal Dubey mentions, “As a fundamental principle, we allocate 5% to 10% of our budget to experiments involving new-age tech stacks and trends. Whenever we observe positive results, we intend to scale the platform accordingly.”

Additionally, Hyatt India Consultancy’s Deepa Krishnan comments, “With the emergence of trends such as ‘Segment-of-One’ Marketing, we expect generative AI and predictive AI to play a pivotal role in delivering hyper-customised experiences across unique yet meaningful touchpoints. Additionally, this year is set to witness a focus on sharper media targeting and driving more efficiencies on search and digital spends.”

According to Gartner, 63% of marketing leaders have either invested in AI or are planning to do so in the next 24 months. 90% of marketers believe that AI and automation help them reduce the time spent on manual tasks. The report further estimates that AI holds the greatest financial impact on marketing and sales compared to other business functions. 

Maruti Suzuki’s Shashank Srivastava believes that marketing communication will focus on sustainability, nudging customers towards cleaner mobility options such as EVs, hybrids, flex-fuels, and CNG. 

Tips to note

Ayaesha Gooptu of Bacardi India points out, “Beyond digital strategies, tapping into the emboldening ‘vocal-for-local’ sentiment will be critical in resonating with Indian consumers.”

Gooptu anticipates more marketers to invest in localized campaigns that position their offerings with the prevailing homegrown sentiment in the country this year, in a bid to secure a competitive edge.

Godrej Capital’s Nalin Jain shares a few pointers on navigating marketing spending challenges. He suggests businesses to adopt a diversified approach. 

“Firstly, prioritize data-driven decisions, leveraging analytics to identify high-performing channels. Secondly, embrace a holistic strategy, allocating budget based on the unique strengths of each medium. Thirdly, invest in creative content that resonates across platforms, ensuring a consistent brand message.”

Lastly, staying agile and adapting to emerging trends is crucial for sustained success in the dynamic marketing space, as per Jain. 

Motorola APAC’s Shivam Ranjan says, “Prioritise tentpole activities and focus on investments that maximise brand SOV. I would recommend investing in new-age video and engagement-led formats in line with the changing consumer behaviour and content consumption patterns.”

Kunal Dubey of Cleartrip suggests maintaining an experimental mindset and testing in both control and test markets should be ongoing, aiding in the optimization of the spending in real-time.

He also mentions being precise in planning more audience cohorts for an effective campaign. Alongside this, monitor creative effectiveness and be prepared with a Plan B. This prevents heavy spending on low-performing creatives.

Lastly, utilizing full-funnel media consistently through different channels despite the same audience.

As businesses across sectors, from automotive to hospitality are gearing up to allocate larger budgets towards digital platforms, AI, AR, and VR technologies, the aim is not just at enhancing consumer engagement through immersive experiences but also at optimizing marketing efforts to tap into India’s growing affluent class and digital-savvy generations. 

Source: Social Samosa

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