CII Marketing Summit ’06: HCL’s Ajai Chowdhry Discusses Consumption Trends

The theme for CII Marketing Summit 2006 is “Marketing in a Global World: New Rules for an Old Game”, and with the way the digital space is developing in this country, it had a fair amount of participation from the tech pack. Among the speakers on the first day was Ajai Chowdhry, Co-Founder, Chairman & CEO, HCL Infosystems. HCL in one of the co-sponors, and is celebrating it’s 30th year. Here’s what he had to say about “Consuming India – New Trends for a New Indian Consumer”:

On India:
India is the marketers dream because its main consuming class is going to be young, middle class and digital – the growth in acceptance of broadband is phenomenal and the market for all types of digital lifestyle products is increasing. India is fast becoming digital, and there’s a project to make Delhi 100% digital by 2010.

On Marketing to the Indian Consumer: One thing in common among Indian consumers: most of them are young and have high disposable incomes, particularly among working women. Indian consumers are probably more tech savvy than their peers in the rest of the world, and have an IQ focus; they can discuss product specifications in depth. The challenge for marketers lies in EQ: to develop a relationship with the consumers and engage them. In the digital world, the MySpace model is being replicated in India, and it is important for the marketer to address the consumer within these spaces. The Internet and mobile services make the Indian consumer more accessible today than ever before. Hence the share of advertising on the net and mobile is going to grow.

On Consumers in small/non-metro towns: According to a Synovate survey, interest in digital products is increasing in small towns:-  People in Kochi are buying colour mobile phones; Ahmedabad is the largest market in India for digital cameras. Easy financing options and a relaxation of loan norms is playing a major part in making otherwise expensive products accessible to consumers in smaller cities. (He later re-emphasised the importance of EMI by giving an example wherein the Rs. 499/- a month price for one of their PC’s that actually increased the propensity of the consumer to purchase it.)

On Products: Product life cycles are shrinking. Any new product gets replicated very soon, and hence innovation gives rise to only “Temporary Monopolies”. Also, households are becoming multiple product households, which presents a great opportunity for marketers. CRM is key for selling more products, as is communicating to a well targeted market. An example is the HCL Beanstalk that was promoted 10 years ago in India, by using advertising and events targeting kids.
Servicing is critical, so HCL is setting up Digital Care locations , as well as Digital Lifestyle stores. It is important to co-create products with customers: when HCL learnt from Karnataka Police that they faced power problems and were hence unable to use the pc’s effectively, HCL created a pc that ran on a car battery. Similarly HCL creating specialised PC’s for the BPO market, in collaboration with some BPO firms.

During the Q&A: S.D. Saxena, Director-Finance at BSNL said that growth in the digital space seems unlikely since consumer density of PC’s in most of India is minimal, and hence BSNL is facing difficulty in rolling out their broadband services, even though they possess the wherewithall.
Ajai Chowdhry responded that at one time even the TV was not affordable in India. TV became big because of two reasons: prices fell below Rs. 10,000, and cable became cheaper; and multilingual content drove demand. A similar this is going to happen on the Internet and mobile. Multilingual and local content is critical: China has an immense local content, and but the problem with India is that there are too many languages. The price of the PC and broadband, and the availability of multilingual content is a part of a virtual cycle of demand creation that might not take place if multilingual content isn’t developed.

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