The Integer Group has just opened its office in Mumbai in alignment with TBWA India to serve both its global and Indian clients. Dipali Banka spoke with Marc Ducnuigeen, president of Integer International, on the sidelines of the launch about the scope of shopper marketing in India.
Q] What is your assessment of shopper marketing in India? What scope do you see?
This is clearly an emerging economy. This is the right time to come in because the market is still in its infancy. All the BRIC countries are not equal. China is actually a very different place because modern retail is much more established. The middle class there is much more established, so they have more customer choices. But the traditional way in which Indian shoppers buy is going to change rapidly. Whether you are in an urban or rural setting, you are starting to look at choices. This is going to accelerate rapidly based on what we have seen in Brazil and emerging economies in South- East Asia. People will take off quickly and it will be hard to catch up if you wait for the right time.
Q] A few other big research firms have also launched their shopper marketing divisions in India, but we do not know how well they are doing.
Yes, we are aware of competitors in the line. In our international network, we are not motivated by being first in a geography because when you are expanding in different markets, you have to pick the right time for that marketplace because there is expense and effort involved to build and grow. We’ve deliberately chosen to hold back in some places. We thought about coming here a year and half ago and be more aggressive. But the marketplace here is still relatively nascent.
Q] So, you are actually waiting for FDI in multi-brand retail to be passed in India, and since it has not yet happened, you thought you might as well get into it anyway?
FDI in retail has a huge implication on the retailer side. Obviously, it will dictate who the players are and how they will behave. If you look at some of our biggest clients, for example P&G, their products are still sold here. So even if FDI in multibrand retail does not happen for a long time, they still have to figure out how to work through the Indian retail customers. They have to work through Kiranas and still understand shoppers and how to put products that will meet their needs. We still have to help them to figure that out. We have seen big global retailers like Carrefour and Walmart being successful in parts of the world but they are not universally successful. Every marketplace is different. In this marketplace, if I was an Indian retailer, I might actually think really aggressive about shopper marketing principles and how I can give a choice that my shoppers can come to expect and demand. Because when you do that, the shopper likes you as a retailer and wants to have a relationship with you. And that is where loyalty comes. Big global retailers understand this shopper marketing stuff and that is how they will approach a marketplace. So if the local players are not doing it, it will be a business disadvantage.
Q] Shiv Sethuraman (chief executive officer of TBWAGroup India) mentioned that you are not going to be much in the execution part, but a lot into research and insights. Could you explain that?
In a market like this, which is so big and fragmented, whether you are talking traditional or modern, execution actually becomes a critical commodity. It requires a lot of infrastructure and honestly in most of the markets, not uniquely in India, it is not a big differentiator. You can always find someone else who executes something at a price. We have that as part of our business in certain other markets and certainly it is a heritage in the US. But what we have come to find is that the real value of what we deliver as a business partner of a client is the planning framework and the real understanding of a shopper; devising the correct communication strategy and ensuring that you are maximising the brand’s potential with the shopper. We are also a big part of the communication idea. And if it is the right thing for us to execute, great. If not, it doesn’t matter. Someone else can actually go and execute it. If I spend all my time and money trying to build and execute the infrastructure, how am I going to compete?
Q] Yes, because otherwise what is the difference between you and a BTL agency which also provides insights to the client and executes their campaigns?
To be honest, Integer has a lot of ‘BTL’ but it is important for us to be unique in consultation and it is part of our framework because that defines how clients view us and what we represent and can deliver for them. Our Shopper Continuum framework maps out for the client everything you get from everyone of your agencies. And it is not a competitive pitch on my part to say that you should give me all your work. I want to say, I want to be the champion and the steward of your business and your brand and I want to help you understand how all the things you do fit together and where they don’t. We point out the gaps and show opportunities to drive and grow the business.
Q] Where does a shopper marketing agency’s function come in? At which stage of the decision process?
When a client thinks about us as a BTL agency, it is a mistake which puts us at the end of the food chain. The inputs that we help deliver are much more strategic and insight-based. We have an established process with our big clients where they engage us at the same time as every other agency. We should have a seat at the table. There may be a lead agency and it does not have to be us. But we are the champion of shoppers and when you create the first holistic brief, we ensure whether it reflects the reality of retailers and key customers. That should all be incorporated initially because otherwise you are just left with a great TVC, but no connection and reality of how the product is sold. You cannot just put a great idea in store because the retailer is not going to allow it. Someone has to champion that point of view. And with all due respect to my sister agencies and especially advertising agencies, that is not what they are trained to do. So, having a seat at the table early, even if our work doesn’t always start right away, helps with the brief and actually planning. Wal-mart requires their research 12-15 months in advance. TVCs are done a week before. So, our timelines are actually much longer and that is why you should involve us earlier.
Q] You also provide insights on the digital side of shopping and it is growing at a fast pace in India right now. Again, with this, are you competing with digital marketing agencies?
We’ve actually found that we are not. Our framework is about mapping the shopper. And a shopper might go to a store or a website or might do both. To give an example, in the US there are 300 million people; Wal-mart has 3,500 stores in the US which means that every seven days, 110 million US consumers go to a store. So that is a third of the population, which is massive. But what people don’t realize is that half of those 110 million, every seven days, go to walmart.com before they go to the store. So for Wal-Mart this interrelationship is really important. It is important how you communicate to the shopper who is going online, less to buy but more to check product availability, to compare pricing, list preparation, etc. That experience is important to carry over to the retail.
So our focus on digital, when we talk to clients is that we are the champions of your shopper whether he is on digital or retail. You should not hire us only to do this or only that. We develop digital strategies around e-commerce communication and creative ideas but where we do not compete is actually executing digitally. We may have producers and programmers only to understand how to ensure that a creative idea can actually be executed digitally, but we do not execute it. We typically partner with digital agencies. We hand them the work and they do the coding and production.
Q] What is the kind of business that you are expecting from India? What are the targets that you have in mind?
I don’t want to give all of those away because my competitors will get all the secrets. Some of our biggest network clients are global companies, so those will represent our biggest opportunities here. And certainly beverage and FMCG are obvious categories that we will go after. It has also played out in other markets. Apart from that, any client that has a franchise, dealer or a distributor base is an opportunity for us as we have huge expertise in managing complexities in communication, especially when you don’t own your distribution.
Q] Global companies have an exposure to such research and are maybe open to it, but regional Indian companies might have apprehensions about the concept of shopper marketing as they would think that they know their customers better. How are you going to sell this concept to them?
I don’t know. I guess we will have to see. We have encountered this in other marketplaces too and certainly if you are speaking with someone who has a really strong belief in their own practices, it will actually be pretty difficult to prove to them only on the basis of what we say. It will probably take competitive pressure or a loss of business or something negative for them to sit up and take notice.
Also, in every marketplace, we’ve seen big multinationals come in and begin to apply the disciplines of shopper marketing. It doesn’t matter - the culture or what you don’t know - but these principles approach thinking of work universally. Obviously, specific ideas and the solutions will vary, but the broad principles work.