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Indian marketers assign 15% ad spend to social media: E&Y

Social media is emerging as an integral component in brands’ marketing strategy in India. An Ernst &Young study, ‘Social Media Marketing India Trends’, has further reiterated the sentiment showing that brands and companies in India are marking 15 per cent of their advertising spends for social media marketing strategies.

Brands across industries have realised the significance of social media and its peculiar demands. About 90 per cent of organisations are planning to spend as much as 15 per cent of their annual marketing budget exclusively on social media, up from 78 per cent organisations in 2013, according to the study.

The key to successful media campaigns is in digital marketers understanding the dynamic digital avenues in the Indian market, leveraging and navigating the social media space better. There is a distinct need for brands to analyse their maturity levels and explore disruptive opportunities for growth in the digital arena.

Digital and social media presence is a key element in the marketing mix of most brands. About 23 per cent respondents of the study stated that their social media budgets were in excess of INR 1 million per annum and 14 per cent of the brands spent INR 10-20 million on social media in 2014. There was a decline in the number of brands that spent in excess of INR 20 million from 17.1 per cent in 2013 to 14.3 per cent in 2014.

“Through this study we reached out to India’s top social and digital savvy brands from the third quarter of 2014 to January 2015. It is our observation that while brands have invested financially and in processes, there is a need for holistic customer engagement and strong community building strategies through the use of social media. That, in my mind, will strengthen the brand and allow for innovative and meaningful interactions between communities, as well as between the company and the community,” said Dinesh Mishra, Partner and Customer Practice Leader (India), Advisory services at Ernst &Young.

“About 32 per cent of digital-savvy brands in India depend on the internal core team for strategy but the average team strength is small varying from 1-3 people. Given the mass reach and quick response time in social media, ownership plays a critical role in success. Every organization irrespective of size must focus on developing capabilities and creating a strong internal governance framework,” he added.

In 2013, social media was increasingly used for thought leadership and internal communications, recruitment, and corporate social responsibility (CSR) in addition to marketing. About 35 per cent of the organisations said that they use social media for thought leadership and around 27 per cent said they use the medium for CSR. As the industry matures, the human resources department is leveraging social media for internal employee outreach through unique platforms.

However, some find it challenging to measure customer engagements though social media initiatives. “Despite the advancement in the data analytics, the technology is still in its developing stage in India as compared to developed markets such as US and Europe. Data analytics in India do not exist at the same level and scale of economies have to kick in before digital marketers can leverage the operations of data analytics,” said Shrenik Gandhi, Co-founder of White Rivers Digital.

Indicating that brands are exceedingly cautious on the returns and are optimising spends. As integrated campaigns are reckoned as effective, being able to correctly attribute leads, attain conversions and returns to channels, campaigns and devices will determine how budgets are allocated going forward.