Digital media game will change completely in five years: FrogIdeas CEO

Innovations are not happening in India and that's a challenge that we need to address as an industry, says CEO Jatin Modi

How has the advertising landscape in India changed with the rise of digital media?

Advertising in India is hardly seeing any retainers. Advertising as we know traditionally is today restricted to few industries such as telecom, banking, financial service and insurance, and e-commerce. If we look at other industries, we will hardly find them on television (TV). Almost every industry apart from the above mentioned advertisers is going on to digital media instead of TV.

Companies now understand that they need to be on digital media in order to reach out to the fragmented audience. For example, if you are in publishing, you want to reach out to people through LinkedIn and other digital platforms. The always-on nature of advertising is changing.

Is there a proportionate increase in the marketers’ digital media spend?

Undoubtedly, the influence of digital media is increasing. But even now, digital accounts for less than 15 per cent of the total marketing spend by advertisers. Five years back this figure was less than 5 per cent. If we look at the United Kingdom, 12 years back, the spend on digital was less than 10 per cent and today it is more than 50 per cent. 

For a country like India, a 10 per cent jump in marketing spends on digital in less than five years is a big thing. Reliance Jio coming in and providing internet access to 280 million people who never had access to internet changes the game completely. The next five years will see the game for digital media changing completely with marketing spends going up to 30 to 35 per cent.

To what extent are digital advertising companies in India leveraging new-age technologies like AR, VR, and AI?

The technologies including augmented reality (AR) and virtual reality (VR) are starting to pick up in a substantial way. Look at the industries like hospitality, real estate and automobile, where your intent to purchase is driven by experience. Players are using AR and VR to deliver superior consumer experience. As regards to artificial intelligence (AI), I believe AI per se is not working. Most companies are doing machine learning and saying they are doing AI. AI is not yet mature. 

We have done a lot of work on messenger, voice interactive using AI for our clients. But algorithms can only support such work to a certain extent. AI is set to mature quickly globally as well as in India. In the next five years, the technology will evolve substantially and we will reach a point where consumers need not interact with a bank executive at all. Chat bots will be trained to carry out real-time conversations, they will be trained to understand the context of a given situation. Going forward, many services will move into computer-aided services. All this will come about as the AI industry grows and matures. Algorithms will become more sophisticated, their applications will be clearer and they will become stable over time.

What are the categories that spend big on digital and which industries are still playing catch-up?

Marketers across product categories have a clear understanding of the potential of digital media and the deliverables that digital marketing promise. For others, they need upgrades, informed conversations to internally make a case for digital marketing and budgetary layout. There are clients who are spending more than 50 per cent on digital and are very mature in what they want. Industries like BFSI and retail are more advanced and more sophisticated in what they want compared to other industries. Digital spends in FMCG category need to go up. There are industries that are still spending less than 10 per cent on digital. Technology companies are changing and moving to digital quickly. The business-to-business (B2B) segment is also changing fast. B2B players are taking out budgetary outgo from exhibitions and events and putting it into digital.

What are the kind of solutions that marketers are looking for from digital?   

The first area is corporate reputation — that is, how you build and sustain it. Corporate disasters are no longer breaking in newspapers, they are breaking on social media platforms. As a marketer my priority is how do I make sure that damage done to a brand gets contained. People are used to managing reputation in print and TV. However, response management, mechanism, methodologies and procedures are not well-defined for online. The second area relates to generating awareness and lead depending on what business one is in. Marketers are asking how do I get clear cut return on investment from my marketing initiatives? The focus here is on driving brand awareness/consideration and preference and generating business leads. The third part relates to marketing automation that is a combination of technology and content marketing. As a brand it is important to identify each consumer as a different person and engage them with personalised marketing-oriented messages on different mediums.  

How does the India market compare with others in the region in terms of adoption and innovation in digital marketing solutions?

We are better off than Southeast Asia and West Asia. I think Western Europe, North America and Australia are a little more advanced than us. It’s all a question of the ecosystem. For example, if there is a new technology piloting out of Silicon Valley, it will first hit California, New York, Chicago, and Boston in that order. Likewise, if something is happening in Israel, the developments are likely to first hit Western Europe, London or Stockholm. Innovations are still coming from global markets. Innovations are not happening in India and that’s a challenge that we need to address as an industry.