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Do away with “digital departments”, says PepsiCo’s Shiv ShivaKumar

In the digital world, a lot more is happening in the East even if the West is home to many technology brands. The East lives in a mobile-first digital world, creating a significant difference from the West, and more importantly leading to a situation, where there is much that the East can teach to the West. In today’s day and age, when technology has changed human interaction itself, social networks may have increased the quantity of friends but not the quality, and the situation is constantly changing, courtesy the mobile-first digital world.

The year 2015 would be a defining year in that regard. The world already has 7.5 billion SIM cards, 5.5 billion phones, 3.2 billion smartphones, where the concept of smartphone has changed from a QWERTY keypad and space conversation to anything that the consumer can make of it. By 2018, 50 pc of the world would be on the internet. And for most brands, 85 per cent of its relevant consumers target would be on the net.

It was after building this background that Shiv Shivakumar, Chairman & CEO, PepsiCo India stated, “I don’t think any marketer can have a digital marketing department today because digital is everywhere. This is the year when tablets will overtake PCs, a category which is just under seven years old. The pace of the digital world is staggering, and the impact is far reaching.”

He qualified this with the caveat, “We are still in a situation, where the rise of a new force needs dedicated attention, and which is why you still see digital departments but I see that changing soon, simply because of the pace at which this medium has become omnipresent.”

The impact of digital is everywhere. At a basic level, 88 of 195 countries today are ‘free’ countries where citizens have the absolute freedom to express their opinion. Every individual is a citizen journalist, implying the most significant impact of digital being on freedom.

Different strategies for different markets
Data shows that for a market where the GDP per capita is below USD 2000, the average number of digital device per person is at 1.43 devices. Around 53 countries fall in this category. For markets, where the GDP per capita is at USD 50,000 – USD 1,600,000, this number is at six devices and only 17 countries fall in this bracket. Most fast growth markets in Asia are in the first category of GDP per capita below USD 2000. What are a marketer, publishers and media creates for these markets will be very different from others.

Digital is still the fastest growing medium in these markets, primarily because of its deeply personal nature. The next big trend in these lines would be in the wearables sector. In the last decade, mobile internet has seen 2134 per cent growth while fixed internet has grown by 406 per cent.

In a market like India, social platforms have more circulation than all newspapers put together. In these markets, a good mobile experience connects equally back to recommendation.

“The digital influence on consumers is very significant. Something that the West will also learn because the East has leapfrogged in consumption,” observed Mr Shivakumar.

Another big difference in the East is that aspiration and the role of brands. Unlike the West, where brands are ‘allies’, in the East, only some brands are allies to consumers, most are crutches. “That being said, brands will exist as long as there are emotions. They have a fundamental and central role to play. In bigger markets, this role is more significant. In East, it is still about aspirations,” Mr Shivakumar elaborated while speaking on the last day of Festival of Media Asia.

The ‘T’ Word
The fundamental of brand philosophy, where the consumer is king has not changed. However, today, the ‘king’ has a big voice and in most cases, is part of many common interest communities. Consumer generated content is one of the biggest realities today, and there is a significant increase in local content. Marketers, even in markets such as India, are seeing consumers create for brands.

However, trust is also one of the most critical things that brands have to pay addition focus on. “Trust can be earned and lost on a daily basis and this has a substantial implication on how brands would respond to consumers. The clock is reset every morning, and you have to earn trust back every day. If you are not able to do that, trust, and all associated with it, would be lost.”

Mr Shivakumar once again stressed on the importance of locally generated content in this aspect. He also quoted PepsiCo’ ‘Crash the IPL’ initiative to explain how marketers are giving control in the hands of the consumers to create on behalf of the brand.

He concluded his address, stating, “The future marketing department, in my view, would be humble, responsive and have more data scientists in it.”

Noor Fathima Warsia

A veteran journalist in the Indian marketing, media and advertising fraternity, Noor Fathima Warsia took on the role of Group Editor -– APAC for Digital Market Asia in May 2013. Noor has focussed on tracking trends and developments in the Indian media industry.