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BW Businessworld

The Growing Trend-Spend Disparity

The consumer behaviour is changing with the use of Internet, but there isn’t any significant difference in the marketing spend pattern

Photo Credit : Subhabrata Das


For the last two weeks, nearly all media outlets have visited and re-visited Kleiner Perkins Caufield Byers’s Internet Trends Report, popularly dubbed the Mary Meeker Report, to look at global media consumption trends. The only constant in the report over the years is the disparity between consumer behaviour and marketing spends. Leading global authorities on marketing and advertising cite the report to highlight consumers embracing connected mediums at a noteworthy pace. In contrast, significant amount of marketing push appears to repeat media plans of previous years, focusing most of their attention on print and television.

Many expressed concern when the report this year indicated further decline in the year-on-year rate of growth of Internet users globally. The Internet user base grew only 9 per cent in 2015, reaching 3 billion, which is 42 per cent of the world’s population. Meeker’s comment that the Internet boom time is over did not help either even though the report highlights opportunities in artificial intelligence, messaging platforms, e-commerce, live content and advertising. The report also busts the bubble for leading digital companies stating that online video ads were ineffective, despite the fact that video viewership itself was exploding.

India appears to be the only market that has bucked all trends and registered a growth of nearly 40 per cent, taking Internet users in the country to 277 million. India in fact is the only country where the pace of growth is higher than last year. The more important takeaway is that India now is the second largest home to onliners. China leads the way on that count, asserting the role the East is going to play in setting future trends. US follows India.

To connect the world, you need to connect India, Mark Zuckerberg had eloquently stated last year, reminding that India is home to a consumer base of 1.2 billion people with an online audience segment of 277 million. These figures vindicate the move that the likes of Facebook, Google and Microsoft have been making in terms of investing in the technology-led media scene in India.

Many look at the Meeker report as a guideline, when it really is just a reflection of what has already happened despite the trends it forecasts. Like any other report, it may help chasers but to get ahead in the game, some fundamentals need to be understood.

The question is if decision makers are changing to be in line with the evolution of the consumer and the market itself. Time and again, as journalists, we have questioned marketers whether they are willing to take a chance and be present where the consumer is. And the marketers who have taken that chance without results have asked right back about where the right opportunities are. The fact that 76 per cent of online advertising in the US resides with Google and Facebook is not a coincidence. The case will not be too different for India too. In digital, there is no right or wrong, no first mover advantage and yet, it is those very established players that take the largest pie of the spend. They are ahead in the game. Many, including very established digital players are chasing instead of leading. It is important to understand the reason behind this behaviour — why leading men and women prefer to play it safe than up the ante. The biggest surprise is how this a complete converse to what is in fact required in a medium that allows ad blocking much more efficiently than others.

The Meeker report asks once again, if the industry is ready to embrace the change the consumer already has.

[email protected]; @NFWarsia