Brands & Festive Season Part 2: Decoding the market dynamics & shifts in behaviour

After over two years of Covid-led disruptions and lockdowns and subdued market sentiments, brands as well as consumers are looking forward to a bumper festive season this year. In Adgully’s numerous interactions with industry experts, what has emerged strongly is that it is expected to be business beyond the usual this festive season as there is a strong propensity to spend amongst the consumers, and brands and advertisers are well prepared to meet the growing consumer demands.

Part 1 of this report saw industry experts highlighting the optimistic market sentiments this year, how this upbeat mood is visible across categories, the return of ad spends to pre-Covid levels, growth projections, and much more.

Continuing with the conversations with the industry experts in Part 2 of the report, Adgully delves deeper into the market dynamics this festive season.

Shifts in behaviour

Post-pandemic, there has been a discernible shift in the behaviour of not just brands, but the consumers as well. One of the major effects of the pandemic was that people moved to e-commerce sites in large numbers.

“One of the shifts noticed is that today brands need to have purpose and keep up with the changing times. This goes beyond the simple AIDA model to seek a consumer. Consumers seek value beyond the obvious from brands and that’s one of the reasons that the brand & corporate category grew in the pandemic besides pure product advertising,” says Simran Hoon, CEO, QYOU Media.

With the rapid spread of digitalisation, consumers are increasingly opting for the phygital mode to conduct purchases, notes Abbey Thomas, Head of Marketing & PR, Volkswagen Passenger Cars India. Speaking about the auto industry, he adds, “The first point of familiarisation happens through the Internet using various tools and platforms, including the company’s website, test-drive videos, and reviews. This is where the consumer shortlists a certain set of cars and models based on individual interest and purchasing power. This is followed by physical visits to the showrooms and getting a first-hand experience of the shortlisted vehicles, ultimately making the final decision. Going further, we will see the gap between digital and physical modes of purchase narrowing further. Bound by the growing trust of customers in the digital marketplace, we foresee tremendous developments including an AR experience of the car’s interior, a simulator to give a driving experience, and more.”

Mayank Shah, Senior Category Head, Parle Products, points out that consumers are on the lookout for new things and new experiences. “Not just muted festivities, but in general too, people want to get over the restricted living they have experienced in the past two years. They want to enjoy life and try new experiences.”

Mayank Shah shares an interesting observation about the Indian consumers. According to him, the Indians’ alacrity for saving for a rainy day has changed due to the pandemic. “The behaviour is evident not just in their preferences, but also in their spending habits. We can see that through the surge in the travel and hospitality sector. People now want to live more for the present day than save for a rainy day. Indians in general are known for their saving habits, but the pandemic has changed that. Hence, there is an influx in demand across industries and people are looking for new products and new experiences,” he elaborates.

Parag Shah, Director, HK Jewels, points out that during the pandemic consumers got accustomed to using the digital/ online platform. As a result, discovery through online has received a boost and will continue to play a critical role. “However, as we normalise back, while online will play a critical role in discovery, we foresee a shift back to the brick-and-mortar retailers for final purchase. Buying jewellery is a high-involvement experience for the consumers; it’s often a family decision and it’s also an opportunity for the family to bond. Nothing can compare to the joy of going back to the retail store and checking out the offerings. Online, however, will continue to tap into the younger generation and will be a key driver in the lightweight, low to medium level involvement pricing segments,” he adds.

During the pandemic, the ad spends had skewed towards digital platforms with customer apprehension towards physical engagement touchpoints, says Abbey Thomas, adding, “However, we see that trend shifting back to pre-COVID levels, where the spends are bifurcated across the mediums. For 2022, our media mix comprises of 55% ATL activities that include broadcast/TV, OOH, print, etc., whereas 45% goes through digital platforms and social media.”

Socxo CMO Ajit Narayan is more cautious about the ground realities. He feels that even though the effects of the pandemic are over, there is more to it than meets the eye. “We should also look at where the economy is heading – with inflation, jobs, savings, lifestyle – if we are to look at consumption in general. Media is not something to be viewed in isolation. Global recessionary pressures and inflation are visible and there is a lot of chatter around it. While consumer confidence seems to be coming back, it might not materialise as a big win as the mass is still looking at uncertainty in livelihood.”

According to him, travel and automotives are rebounding. Travel, which took the biggest hit during the pandemic peaks, is now making a comeback with revenge travel. “And with the leading auto brands planning a slew of new vehicle launches, show the optimism of doing more business. The new vehicle launches running into the festive season will be driven by advertising and promotional offers being doled out to get consumers back on the wheels,” he adds.

The biggest shift, according to Narayan, has been the normalisation of e-commerce. “While this was growing even before the pandemic, the speed and trajectory of consumer buying has moved dramatically towards e-commerce and will continue to grow. So, advertising and promotional spends on this would be an area to watch out. Also, which other categories jump to this bandwagon to capitalise on this opportunity remains to be seen,” he adds.

The online reach and movement to Tier 2, 3 and 4 cities post pandemic has changed the media mix and consumer purchase behaviour, notes Himanshu Arora, Co-founder, Social Panga. “OTT and e-commerce play a vital role in the overall purchase cycle. As per Shopify’s Festive Shopping Outlook Report 2021, more than half (53%) of millennial consumers from non-metros in India preferred online shopping. And three-quarters (77%) of Indian consumers plan to shop online during the festive season,” he says.

Marketing campaigns and offerings

With regard to the unique marketing campaigns for Volkswagen during this festive season, Abbey Thomas says, “At Volkswagen, we will be promoting for our newest and youngest product portfolio, the Volkswagen Taigun and Virtus. Through our festive campaigns across omni-channel media platforms, we will be focusing on the core DNA of the brand – build quality, safety and fun-to-drive experience. Our campaigns will focus on customer stories and their emotion while driving a Volkswagen reiterating the sheer pleasure of driving. We will also be celebrating a successful one year completion of our most-awarded SUVW: The Taigun. In addition, we will present through our regional level campaigns celebrating specific occasions locally such as Onam, Ganesh Chaturthi, Dusshera, etc.”

According to Thomas, during the pandemic, the ad spends had skewed towards digital platforms with customers’ apprehension towards physical engagement touchpoints. “However, we see that trend shifting back to pre-Covid levels, where the spends are bifurcated across the mediums. For 2022, our media mix comprises of 55% ATL activities that include broadcast/TV, OOH, print, etc., whereas 45% goes through digital platforms and social media.”

Brands came up with unique product offerings to cash in on the changing consumer behaviour. Parle Products, for example, did something unique with its product line-up during this festive season. “We observed that while consumers were interested in buying regular stuff, they were on the lookout for something different,” says Mayank Shah.

“And having gone through troubled times in the pandemic, they were looking to make the festive season really special. So, instead of offering the regular products, we brought something new to the market. Parle G co-created with Bombay Sweet Shop, the ‘Geniously Sweet Collection’, for the festive season. A sweet offering of Parle G Fudge and Parle G Barks, which is novel in taste and also positions as a great gifting item. What’s adding to the entire offering is the huge amount of nostalgia with a brand like Parle G. We thought of launching it around Raksha Bandhan, keeping in mind the spirit of the festival. We rekindle memories with our siblings and are sentimental about the sibling relationship. Most siblings will also remember having Parle G together. So, relighting those memories was something that we were working on, and it has come out well. The gifting range developed with these two products has seen a huge amount of traction as well as positive feedback from consumers,” he says.

According to SellPro Founder-Managing Director Ravi Dubey, there has been an increase in spending during the festive times because people have now become more focused about their own health and also the health of the people around them. “They understand the impact of Good Nutritional food and hence the category of dry fruits has also seen a spike in demand post-Covid times,” he points out.

“Online media saw an increase in ad spend during the last two years of pandemic,” says Himanshu Arora. According to him, consumer behaviour has changed a bit this festive season, and focus will be on newly developed categories like D2C and online purchase across categories like FMCG, personal care, consumer durables, etc. 

“With the T20 World Cup scheduled in October, it can act as an icing on the cake for advertisers and brands. An opportunity to address a larger critical mass of consumers. Ad spends have returned to the pre-Covid levels in most of the categories, and this festive season it is expected to go bumper for most of the brands. We have already gone through three waves of COVID,” he says.

Source link Shopify Experts

Post Author: Adam Jacob

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