DIGITAL MARKETING FOR FMCG INDUSTRY by mudit chopra A1802010351

Table Of Contents

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Contents Objective Of the Study Introduction Digital Marketing In India Growth Of Digital Marketing in India Status Of Digital Marketing in India Indian Portals/Websites dealings in Specialized field Top Digital Marketing Companies of India Benefits Of Digital Marketing to Business Future Of Digital Marketing in India Review Of Literature Research Methodology a)Research Design b)Data Collection c)Sample Universe d)Sampling Techniques Questionnaire Data Analysis References

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OBJECTIVES OF THE STUDY To study scope of Digital Marketing in Indian Market. Current STATUS of Digital Marketing in India Digital Marketing vs. Traditional Marketing(print, TV, radio etc)

INTRODUCTION

DIGITAL MARKETING IN INDIA

For developing countries like India, DIGITAL MARKETING offers considerable opportunity. DIGITAL MARKETING in India is still in nascent stage, but even the most-pessimistic projections indicate a boom. It is believed that low cost of personal computers, a growing installed base for Internet use, and an increasingly competitive Internet Service Provider (ISP) market will help fuel DIGITAL MARKETING growth in Asias second most populous nation. Indian middle class of 288 million people is equal to the entire U.S. consumer base. This makes India a real attractive market for DIGITAL MARKETING. To make a successful DIGITAL MARKETING transaction both the payment and delivery services must be made efficient. There has been a rise in the number of companies' taking up DIGITAL MARKETING in the recent past. Major Indian portal sites have also shifted towards DIGITAL MARKETING instead of depending on advertising revenue. Many sites are now selling a diverse range of products and services from flowers, greeting cards, and movie tickets to groceries, electronic gadgets, and computers. With stock exchanges coming Digital Marketing the time for true DIGITAL MARKETING in India has finally arrived. On the negative side there are many challenges faced by DIGITAL MARKETING sites in India. The relatively small credit card population and lack of uniform credit agencies create a variety of payment challenges unknown in India. Delivery of goods to consumer by couriers and postal services is not very reliable in smaller cities, towns and rural areas. However, many Indian Banks have put the Internet banking facilities. The speed post and courier system has also improved tremendously in recent years. Modern computer technology like secured socket layer (SSL) helps to protect against payment fraud, and to share

information with suppliers and business partners. With further improvement in payment and delivery system it is expected that India will soon become a major player in the DIGITAL MARKETING market. While many companies, organizations, and communities in India are beginning to take advantage of the potential of DIGITAL MARKETING, critical challenges remain to be overcome before DIGITAL MARKETING would become an asset for common people. Indias DIGITAL MARKETING industry is on the growth curve and experiencing a spurt in growth. The Digital Marketing Travel Industry is the biggest segment in DIGITAL MARKETING and is booming due largely to the Internet-savvy urban population. The other segments, categorized under Digital Marketing non-travel industry, include e-Tailing (Digital Marketing retail), Digital Marketing classifieds and Digital Downloads (still in a nascent stage). The Digital Marketing travel industry has some private players such as Makemytrip, Cleartrip and Yatra as well as a strong government presence in terms of IRCTC, which is a successful Indian Railways initiative. The Digital Marketing classifieds segment is broadly divided into three sectors; Jobs, Matrimonial and Real Estate. Mobile Commerce is also growing rapidly and proving to be a stable and secure supplement to DIGITAL MARKETING due to the record growth in mobile user base in India, in recent years. Growth drivers and barriers are present in equal measures for new DIGITAL MARKETING ventures. A report by the Internet and Mobile Association of India has revealed that Indias DIGITAL MARKETING market is growing at an average rate of 70 percent annually and has grown over 500 percent since 2007. The current estimate of US$ 6.79 billion for year 2010 is way ahead of the market size in the year 2007 at $1.75 billion. The following chart depicts the growth of DIGITAL MARKETING in India in the last couple of years: 33. A report by the Internet and Mobile Association of India. Apparently, more Digital Marketing users in India are willing to make purchases through the Internet. Overall DIGITAL MARKETING industry is poised to experience a high growth in the next couple of years. The 70 percent year on year growth is expected to continue and Indias DIGITAL MARKETING market is forecast to reach a whopping $US 10 billion by the end of 2011.The DIGITAL MARKETING market in India was largely dominated by the Digital Marketing travel industry with 80% market share while electronic retail (E-Tailing) held second spot with 6.48% market share. E-Tailing and digital downloads are expected to grow at a faster rate, while Digital Marketing travel will continue to rule the major proportion of market share. Due to increased DIGITAL MARKETING initiatives and awareness by brands, eTailing has experienced decent growth. According to the third edition of eBay India census 2010 conducted across 28 states and seven union territories, Indias top five rural DIGITAL MARKETING hubs are Ambalapuzha (Kerala), Sajiyavadar (Gujarat), Adala (Gujarat),

Abdalipur (West Bengal) and Kangayampalayam (Tamil Nadu). This means there are two rural DIGITAL MARKETING hubs of Gujarat in top five across India. The survey reveals that Gujarat has emerged as one of the top five Digital Marketing shopping markets in the country. Gujarat is ranked 4th after Maharashtra, Delhi and Tamil Nadu. During the census in 2009, Gujarat was ranked at seventh, from which it has jumped to fourth position. The city of Ahmedabad ranks 7th among top 10 DIGITAL MARKETING hub in the country. eBay India, a 100 per cent subsidiary of eBay Inc one of the leading DIGITAL MARKETING hub in India , has observed a surge in the number of DIGITAL MARKETING hubs in India from 2,500 last year to 3,300 this year.

According to the eBay Census Guide 2009 for Indian DIGITAL MARKETING scenario, it has been found that India has over 2,471 DIGITAL MARKETING Hubs. These hubs are the cities, towns, villages and smaller towns covering the entire length and breadth of the country. Technology or technology related products dominate Indias domestic DIGITAL MARKETING. Whereas, lifestyle product category dominates in the global trade. Technology, being Indias favorite traded vertical category contributes 44% of totals DIGITAL MARKETING transactions according to the latest eBay Census. Lifestyle category at 35% comes second in popularity for Digital Marketing Indians. For Global Trade, lifestyle is the clear winner at 64% of all transactions followed by Media & Collectibles at 15% each. Elaborating Indias domestic Digital Marketing shopping scenario, South India has the most active buyers at 41% of all transactions, followed by West India at 27%. However, West India has the most active sellers at 46%, followed by North India at 28%. Delhi entrepreneurs sold the most technology gadgets at 46% of all transactions to buyers in India. Lifestyle scored on the Exports front at 67% of all transactions Delhi sells the most musical instruments percussion, brass, synthesizers, and guitars - in the country. In addition to this, Delhi buyers bought the most sunglasses in the country according to the eBay census. Delhi buyers have also bought the most number of high end digital cameras in the country. India is showing tremendous growth in the DIGITAL MARKETING. Rival tradeindia.com has 700,000 registered buyers and it has the growth rate of 35% every year which is likely to double in the year 2010. Indiamart.com claims revenues of Rs. 38 crores and has a growing rate of 50 every year. It receives around 500,000 enquiries per month. Undoubtedly, with the middle class of 288 million people, Digital Marketing shopping shows unlimited potential in India. The real estate costs are touching the sky. The travel portals' share in the Digital Marketing business contributed to 50% of Rs 4800 crores Digital Marketing market in 2007-08. The travel portal MakeMyTrip.com has attained Rs 1000 crores of turnovers which are around 20% of total DIGITAL MARKETING market in India. Further an annual growth of 65% has been anticipated annually in the travel portals alone.

GROWTH OF DIGITAL MARKETING

During the year 2000-2001, two major Industry Associations produced separate reports on DIGITAL MARKETING in India. One was prepared by the National Committee on DIGITAL MARKETING set up the Confederation of Indian Industry (CII), while the other was commissioned by the NASSCOM and prepared by the Boston Consulting Group. Both the reports are optimistic about the growth of

DIGITAL MARKETING in India. The Confederation of Indian Industry (CII) report estimates the volume of e commerce to grow to Rs 500 billion (US$ 10.6 billion) in the year 2003. The NASSCOM-BCG Report, on the other hand, estimates for the same year that the total volume of DIGITAL MARKETING will be Rs 1,950 billion (US$ 41.5 billion). Amul, a milk cooperative, is successfully using DIGITAL MARKETING to deepen its brand loyalty. Likewise, corporate in the automotive sector are improving their customer relations through this medium. Some of the new names that are rediscovering DIGITAL MARKETING through new portals at relatively low capital cost, without venture capital funding include: Key 2 crorepati, Music Absolute, Gate 2 Biz. The low cost of the PC and the growing use of the Internet has shown the tremendous growth of DIGITAL MARKETING in India, in the recent years. According to the Indian DIGITAL MARKETING Report released by Internet and Mobile Association of India (IAMAI) and IMRB International, The total Digital Marketing transactions in India was Rs. 7080 crores (approx $1.75 billion) in the year 2006- 2007 and expected to grow by 30% to touch 9210 crores (approx $2.15 billion) by the year 2007-2008. According to a McKinsey-Nasscom report the DIGITAL MARKETING transactions in India are expected to reach $100 billion by the 2008. Although, as compared to the western countries, India is still in is its initial stage of development. E-Marketer forecasts that Digital Marketing sales will more than double by reaching $168.7 billion in 2011. market share is moving toward Australia, India and especially China. Chinas share of regional B2C DIGITAL MARKETING will grow more than threefold from 4.1% in 2006 to 14.3% by 2011. At the low end, South Koreas B2C DIGITAL MARKETING sales will grow by 13.3% over the same period. Between 2006 and 2011, the aggregate CAGR for the five countries will be 23.3%. Fig. 1 sales of selected countries in Asia Pacific Digital Marketing travel is the largest DIGITAL MARKETING sales category in most major countries. For the same group of five countries, plus New Zealand, Digital Marketing leisure and unmanaged business travel sales totaled about $17.7 billion in 2007 and are forecast to rise to $41.7 billion by 2011. E-Marketer forecasts that from 2006 to 2011 Digital Marketing travel sales will grow at a 24.8% annual rate, higher than the 23.3% rate for B2C DIGITAL MARKETING. This indicates that travel is one of the key drivers of DIGITAL MARKETING sales in theAPAC region.7 7 DIGITAL MARKETING Report released by Internet and Mobile Association of India (IAMAI) and IMRB International In China and India, Digital Marketing-travel spending drives B2C DIGITAL MARKETING sales, and it accounts for a majority of total sales. Consumers are less wary of buying services like train or airline tickets Digital Marketing, and sellers can avoid the logistics and delivery problems associated with physical goods.

Some Indian portals/websites deal in a specialized field, for example:

1) Automobiles- On these sites we can buy and sell four-wheeler and twowheelers, new as well as used vehicles, Digital Marketing. Some of the services they provide are: Car research and reviews, Digital Marketing evaluation, Technical specifications, Vehicle Insurance, Vehicle Finance. Stocks and shares and DIGITAL MARKETING- In India today, we can even deal in stocks and shares through DIGITAL MARKETING. Some of the services offered to registered members are: Digital Marketing buying/selling of stocks and shares, Market analysis and research, Company information, Comparison of companies, Research on Equity and Mutual Funds.

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Real estate and DIGITAL MARKETING- They provide information on new properties as well as properties for resale. One can deal directly with developer through consultant. Allied services: Housing Finance, Insurance companies, Architects & Interior Designers, NRI services, Packers & Movers. Travel & tourism and DIGITAL MARKETING- India has a rich history and heritage and DIGITAL MARKETING is instrumental, to a large extent, in selling India as a product, encouraging Indians as well as foreigners to see its multifaceted culture and beauty. The tourist destination sites are categorized according to themes like: Adventure - trekking, mountain climbing etc, Eco-Themes pertains to jungles, flora and fauna. Gifts and DIGITAL MARKETING- In the bygone days, one had to plan what to gift a loved one, trudge across to your favorite shop, and browse for hours before purchasing a gift. The gifts are categorized as: Collectibles like paintings and sculptures, Luxury items like leather goods, perfumes, jewellery boxes, etc, household curios and carpets, etc, Toys & games, Chocolates, Flowers, Woodcraft. Hobbies and DIGITAL MARKETING- The most popular hobbies from time immemorial are reading, music and films. The books cover a wide range of topics like Business, Art, Cookery, Engineering, Childrens Stories, Health, Medicine, Biographies, Horror, Home & Garden, etc.

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Matrimony and E- commerce- It is said that marriages are made in heaven, but in the world of DIGITAL MARKETING they are made on marriage portals One can search for a suitable match on their websites by region of residence (India or abroad), religion or caste. Allied services for registered members: Astrological services, Information on Customs and Rituals, Legal issues, Health & Beauty, Fashion & Style, Wedding Employment and DIGITAL MARKETING- Two major portals like www.Monsterindia.com and www.naukri.com (meaning job.com in Hindi) are instrumental in providing job seekers with suitable employment at the click of a mouse. The service for job seekers is free and for Employers they charge a nominal fee. Jobs are available Digital Marketing in fields ranging from secretarial to software development, and from real estate to education lanners

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LIST OF TOP DIGITAL MARKETING COMPANIES OF INDIA

1) ASA Systel Communications Pvt Ltd: It is a leading DIGITAL MARKETING company in India which provides innovative and a superb quality web service which encompasses the building of DIGITAL MARKETING related websites and portals. The company also uses the latest payment modes and security. The company has its offices in Chennai, Lucknow and will shortly set up offices in Delhi, Mumbai, Kathmandu, Bhopal. 2) Candid Info: This Indian DIGITAL MARKETING company is based in New Delhi. It is a renowned Offshore Outsource Web designing development DIGITAL MARKETING Company. It offers off shore web development, designing, and SEO solutions for large corporations and SME's. 3) Chenab Information Technologies Private Limited: This DIGITAL MARKETING company in India comprises of web enabled business and web bases services, airline and security systems by using the internet technologies and tools of the state of the art. The company has three Software Development centers in Mumbai and the overseas branch office in New York. 4) Euro link Systems Limited: This leading DIGITAL MARKETING Company provides consulting and e-business solutions, FlexTCA Systems, Trillium Protocol services to the global community. The company has its office in England, U.S, Switzerland, and India with about 200 employee strength. 5) HashPro Technologies: It offers e-business and traditional analysis, development, implementation, design and strategic planning. It is a leader in the provider of integrated talent management software organization in India. It is key technology consulting provider. It renders services like the DIGITAL MARKETING Hosting, Internet Marketing and Human Resources. The eWorkforce initiative of the company will enable the company to become a 100 percent e-Corporation. 6) Compare Info Base: The Company is leading provider of DIGITAL MARKETING portals and IT solutions. The company manages about 1500 websites and portals with 4000 domain names. It has web presence in Maps, Software Development, GISTravel, Education, Media, and Greetings etc. It specializes in Content development services, Website development services; PHP Programming & Development etc. It has its office in Mumbai, Kolkata and Delhi.

7) Sanver E-solutions: This Company is based in Mumbai. They believe that Information Technology is a way to the business objectives. It is an IT consulting and Solutions Provider which offers personalized and personal business solutions using Information and Communication Technology. 8) Planet Asia: This DIGITAL MARKETING company in India uses track record and deep experience in externalized applications to produce high quality B2SPEC(Business to Partner, Supplier, Customer) solutions to global enterprises. 9) Candid Web Technology- This fast growing DIGITAL MARKETING Company in India is a provider of Com Web Solutions for the design and development of dynamic web sites .The clients of the DIGITAL MARKETING company spans from the small scale companies to corporate organizations. 10) Trisoft Design: Trisoft Systems is a software services company that offers solutions exclusively on the Microsoft Platform to customers worldwide. 10 years of experience on the Microsoft Platform puts the company at the forefront of .Net Technology. Research studies have indicated several factors responsible for the sudden spurt in growth of DIGITAL MARKETING in India such as: VOIP (Voiceover-IP) have bridged the gap between buyers and sellers Digital Marketing mergence of blogs as an avenue for information dissemination and twoway communication for Digital Marketing retailers and DIGITAL MARKETING vendors environment and help prevent credit card frauds, identity thefts and phishing infrastructure costs.

Timeline

1979: Michael Aldrich invented Digital Marketing shopping 1981: Thomson Holidays, UK is first B2B Digital Marketing shopping

1982: Minitel was introduced nationwide in France by France Telecom and used for Digital Marketing ordering. 1984: Gates head SIS/Tesco is first B2C Digital Marketing shopping and Mrs. Snowball, 72, is the first Digital Marketing home shopper 1984: In April 1984, CompuServe launches the Electronic Mall in the USA and Canada. It is the first comprehensive electronic commerce service. 1985: Nissan UK sells cars and finance with credit checking to customers Digital Marketing from dealers' lots. 1987: Swreg begins to provide software and shareware authors means to sell their products Digital Marketing through an electronic Merchant account. 1990: Tim Berners-Lee writes the first web browser, World Wide Web, using a NeXT computer. 1992: Terry Brownell launches first fully graphical, iconic navigated Bulletin board system Digital Marketing shopping using RoboBOARD/FX. 1994: Netscape releases the Navigator browser in October under the code name Mozilla. Pizza Hut offers Digital Marketing ordering on its Web page. The first Digital Marketing bank opens. Attempts to offer flower delivery and magazine subscriptions Digital Marketing. Adult materials also become commercially available, as do cars and bikes. Netscape 1.0 is introduced in late 1994 SSL encryption that made transactions secure. 1995: Thursday 27 April 1995, the purchase of a book by Paul Stanfield, Product Manager for CompuServe UK, from W H Smiths shop within CompuServes UK Shopping Centre is the UKs first national Digital Marketing shopping service secure transaction. 1995: Jeff Bezos launches Amazon.com and the first commercial-free 24 hour, internet-only radio stations, Radio HK and Net Radio start broadcasting. Dell and Cisco begin to aggressively use Internet for commercial transactions. eBay is founded by computer programmer Pierre Omidyar as Auction Web. 1998: Electronic postal stamps can be purchased and downloaded for printing from the Web. 1998: Alibaba Group is established in China. And it leverage China's B2B and C2C, B2C market by its Authentication System.

1999: Business.com sold for US $7.5 million to eCompanies, which was purchased in 1997 for US $149,000. The peer-to-peer file sharing software Napster launches. ATG Stores launches to sell decorative items for the home Digital Marketing. 2000: The dot-com bust. 2001: Alibaba.com achieved profitability in December 2001. 2002: eBay acquires PayPal for $1.5 billion. Niche retail companies Way fair and Net Shops are founded with the concept of selling products through several targeted domains, rather than a central portal. 2003: Amazon.com posts first yearly profit. 2004: DHgate.com, China's first Digital Marketing b2b transaction platform, is established, forcing other b2b sites to move away from the "yellow pages" model. 2005: Yuval Tal founds Payoneer- a secure Digital Marketing payment distribution solution 2007: Business.com acquired by R.H. Donnelley for $345 million. 2009: Zappos.com acquired by Amazon.com for $928 million. Retail Convergence, operator of private sale website RueLaLa.com, acquired by GSI Commerce for $180 million, plus up to $170 million in earn-out payments based on performance through 2012. 2010: Groupon reportedly rejects a $6 billion offer from Google Instead, the group buying websites plans to go ahead with an IPO in mid-2011. 2011: Digital Marketing payment and recurring billing services provider Vindicia, developer of the CashBox SaaS billing solution, is named the 20th fastest growing company in Silicon Valley. 2011: US DIGITAL MARKETING and Digital Marketing Retail sales projected to reach $197 billion, an increase of 12 percent over 2010. Quidsi.com, parent company of Diapers.com, acquired by Amazon.com for $500 million in cash plus $45 million in debt and other obligations. GSI Commerce, a company specializing in creating, developing and running Digital Marketing shopping sites for brick and mortar businesses, acquired by eBay for $2.4 billion.

Fast Moving Consumer Goods

Fast Moving Consumer Goods (or FMCGs) are low-cost items that consumers tend to buy habitually and frequently. For the purposes of this report, FMCG goods are taken to be food, drink, household products (detergents, washing up liquid, etc), toiletries, and toys. Consumer goods that are excluded under this definition include entertainment products (cds, dvds, etc), print media (such as magazines), and low-cost clothing from stores like Primark, although non-fashion items from such stores may fit under the FMCG umbrella.

Why FMCGs specifically?

There are three reasons. The first is that is an intrinsically interesting sector any visit to a large supermarket will show that consumers have an amazing amount of choice when it comes to branded goods in the food, drink, household product, and toiletry categories. This presents the marketer with a fascinating task - how to make a brand stand out? How to connect with the consumer so that they will choose one brand of pickles over a competing brand? The second reason is that it is not just interesting, but a challenge. There are some brands whose core customer is quite easily definable, such as PlayStation3 or Harley Davidson. Most FMCG brands, however, have much broader markets; who doesnt purchase fabric softener or chocolate bars or deodorant? These are products that everyone uses and consumes, so marketing communications for them necessarily tend to the universal, making the question of how to use the Digital Marketing channel for marketing purposes quite an interesting one. Who to target, how to identify them, and how should they be engaged? The final reason to look at FMCGs specifically is that there has been little written about the particular challenges of marketing FMCG INDUSTRY through Digital

Marketing searches on academic databases such as Business Source Premier, Emerald, and the Social Science Citation Index have shown nothing in the academic literature on the topic, and the practitioner literature is fairly sparse. Due to the size and importance of this sector, it is therefore useful to attempt to plug this particular research gap.

Literature Review
1. What is Digital Marketing?
SOURCE: Experian Hitwise (2010). In May 2010, Digital Marketingaccounted for 11.88% of UK internet visits, as compared to 11.33% for search engines. When most people think of Digital Marketing, they think only of internet-based social networking services like Facebook, MySpace, and Twitter. This report, however, defines Digital Marketing more expansively, as all those web-based media services where non-professionals can create or distribute content (and content creation in this sense can include basic actions like posting comments), such as social networks, blogs, message boards, and photo- and videosharing sites. Although there are social elements to much of the web (from Amazons review section to newspaper comment sections), having elements of interactivity doesnt automatically make something Digital Marketing. Different people draw the line in different places, which is why there are so many different definitions of Digital Marketing. Even under this more expansive definition, the most important Digital Marketing sites are definitely the social networks, where users can interact with friends, family, acquaintances, business associates and/or strangers. In recent years these sites have become so popular that they have begun to challenge the search engines status as the most popular web destinations, with Digital Marketinghaving overtaken search engines in UK internet visits as of May 2010, according to the consultancy Hitwise, a remarkable record of growth considering

that Digital Marketing social networking is less than a decade old. Some Digital Marketinghave specific purposes (like LinkedIn for career networking), but most are more general, and can be used for all kinds of purposes, from connecting with old school friends to organizing political activism to discussing branded products. These sites are increasingly where people turn to find out about news and culture, with Facebook having now supplanted Google News as a driver of traffic to news websites, according to Hitwise research released in early 2010 The sectors clear leader is Facebook, which has grown to over 500 million active users as of September 2010, an amazing achievement in only six years of existence. It has recently become profitable; a major achievement in light of the many sceptics who doubted that social networking could come up with a viable business modelIn spring 2010 it rolled out Facebook Platform (right), a tool allowingFacebook users to like content on third-party websites and have a link posted to their Facebook walls for their friends to see. According to Facebook CEO Mark Zuckerberg, Facebook Platform is designed to allow the user to shape your experiences Digital Marketing and make them more social The power of the open graph is that it helps to create a smarter, personalized web that gets better with every action taken. Slates Farhad Manjoo sees the avalanche of data resulting from the extension of Facebooks like capability across the web giving Facebook a unique database of human intensions and desires, allowing it to develop new innovative services, and, soon, to make itself as ubiquitous and essential as Google

2. Why are consumers flocking to Digital Marketing?

SOURCE: See http://www.facebook.com/press/info.php?statistics (accessed September 18, 2010). Also see Clark (2009); From the founding in 2004, Facebook had grown to 100 million users by 2008, 200 million by 2009, and over 500 million by late 2010 Putnam (2000), p. 107. According to Putnam, between 1965 and 1995 the proportion of Americans who spent time doing informal socializing on any given day fell from 65% to 39%, with average time spent engaged in such socializing falling from 85 minutes to 57 minutes.

Putnam (2000), p. 170 Levine et al (2009), p. 115 Quitney Anderson & Rainie (2010), pp. 8 The Economist, The Virtual Curmudgeon, (2010), p. 22 Digital Marketing offers the average person several different things at once. Firstly, it allows people to stay connected with many more people than would have been possible in the past. One of the dominant social trends of recent decades across the worlds advanced economies has been the decline of community activity as people, particularly in America, spend less time informally socializing and more time alone in front of their televisions or their computers. This was the trend that the American social scientist Robert Putnam wrote about in Bowling Alone, but he did note that the internet offered the potential for a revival of human interconnectedness. The 1999 internet marketing classic The Cluetrain Manifesto made a similar point when it said that what was drawing people to the internet was the promise of voice and thus of authentic self. The rise of social networking can be seen as a confirmation of this hypothesis, because people continue to thirst for a connection to others, and will happily take up new technologies that offer new ways to build bonds with others. In the Pew Internet Centers 2010 report The future of the internet, Michael Burns of i5 Web Works made a good point about Digital Marketings ability to maintain connections across boundaries of time and geography that would once have been insurmountable: Today and tomorrow, my social reach is much wider as a result of the internet. I am able to communicate and experience so much more with so many more than I could even two years ago The social nature of the net allows us to be better informed about friends and family than ever before. We will all be richer from it. Not everyone is convinced by this rationale, however, with technology writer Jaron Lanier recently making the argument that Digital Marketingfoster shallow friendships that offer no more than a simulacrum of actual human interaction.

A second reason why Digital Marketing has become so popular is the growing prevalence of social sharing sharing news, entertainment and product information with other members of a social network. As David Armano of Edelman Digital put it in a Harvard Business Review blog posting, sharing useful information that might help someone within your network scores you points and builds equity.

3.The Challenges of Digital Marketing Marketing

SOURCE: Levine et al (2009), p. 138. Companies will survive employees telling their truths We listen to individuals differently than we do to organizational speech. Winkler (1999), p. 54 Temporal and Lee (2001), p. 145-161 Mohangir Sawhney and Philip Kotler, Marketing in the Age of Information Democracy, ch. 17 from Iacobucci, ed. (2001), p. 403 Before looking at the specific challenges and opportunities that Digital Marketing confronts marketers with, it is useful to first understand the impact of the internet on the marketing profession over the last 15 years. There are several key ways in which the internet has affected marketing:

consumers (e-mail, banner & pop-up ads, search advertising, web spaces, and now social media) marketing channels less effective for reaching consumers

Negative or positive news about a brand can now spread much faster than was previously possible

in the past.Much of the current debate on Digital Marketing was anticipated in the first wave of digital marketing literature from the late 1990s/early 2000s.

Perhaps the most influential text from this time was 1999s The Cluetrain Manifesto (right), which set out 95 theses about how the internet was transforming the world of business, starting with the first two that declared that Markets are conversations and Markets consist of human beings, not demographic sectors. These insights, that all economic activity involves the needs, wants, and choices of individuals, is often forgotten in conventional business thinking, obscured by the avalanche of quantitative data produced by the various branches of modern capitalism, yet they areabsolutely crucial to understanding the business consequences of the inter-connected nature of the internet. The authors understood early on that the web was a different communications medium, and that businesses would have to abandon jargon and sound human in order to really engage with consumers. Today that insight is a truism, but at the time it was revolutionary. Another way in which the internet has impacted on marketers was how it has dramatically sped up all kinds of marketing processes. In her 1999 book WarpSpeed Branding Agnieszka Winkler explained how the internet enabled brands to be built much quicker than before, such as how Amazon rose to become one of the best-known brands in America in a matter of years. Being able to build brands quickly is crucial because in the internet age the brand is more important than ever, representing a whole ethos as opposed to just a product. It goes without saying that the internet is a double-edged sword for brands. It can allow brand managers to boost brand awareness in an amazingly cost-effective manner, yet it can also spread bad news about a brand at lightning speed. In order to best take advantage of the opportunities that the internet offers, Paul Temporal and K.C. Lee argued in their 2001 book Hi-Tech Hi-Touch Branding that extending a brand on to the internet requires, amongst other things, being consistent with the real-world branding and personality, making the brand experience interactive, establishing trust and delivering on the brand promise, and varying content to suit different users. Putting the processes into pl place so that brands could do these things Digital Marketing was not necessarily a simple process, which is why Mohanbir Sawhney and Philip Kotler of the Kellogg School argued in 2001 that due to the internet:

The role of marketing in the organization will have to change. The marketing organization will need to redefine its role from being a mediator of firm- customer interactions to an integrator of customer-facing processes marketing needs to integrate all the customer-facing processes, so that customers see a single face and a single voice when they interact with the firm. According to The Cluetrain Manifesto, the key to achieving this transformation is applying web principles like openness and speed to subverting the sclerotic hierarchies endemic to the traditional business world. Only by rebuilding from the bottom up can business rehumanize itself, and only by having conversation internally can a business be ready to have a real conversation with its customers

4. What does a Digital Marketing mean for marketers?

SOURCE: Varian (2010) Lindstrom (2009), p. 37, also see Chokshi (2010), Our Changing TV Habits for data on how Americans, especially young people, are increasingly consuming television programming Digital Marketing and therefore experiencing fewer advertisements. Keen (2008), p. 89, also see Scase (2010) McEleny (2010) Brynley-Jones (2010) There are three main reasons why Digital Marketing has become such a hot topic for marketers in recent times: 1. Digital Marketinggather together large numbers of consumers in one place. 2. Digital Marketing allows direct, unmediated access to consumers, which can be used for a variety of purposes beyond pure marketing, such as market research, new product development, and public relations 3. Most other forms of internet advertising have not really worked understanding the growing importance of social. In a 2010 article for 3 Quarks Daily, Manisha Verma argued that internet advertising has failed to fulfil expectations because it is the wrong revenue

model. Web users dont like internet advertising, especially pop-ups, because it interferes with the Digital Marketing experience, and because they can avoid it, they do. Google has been very successful with Digital Marketing advertising, but it is pretty much unique in this regard. The failure of Digital Marketing advertising has had lethal consequences for many media organisations, particularly newspapers, because revenues from web ads have come nowhere near filling the gap from the collapse of print advertising revenues; even after years of rapid growth, Digital Marketing advertising only accounts for 8.2% of US newspaper industry revenue. For brand managers, the decline of traditional advertising channels and the relative weakness of Digital Marketing advertising presents a conundrum how to promote the brand to consumers who are not only harder to reach than before, but also increasingly indifferent to marketing messages? After all, by the time the average person reaches the age of 66, they will have seen approximately two million television commercials, yet according to Martin Lindstrom, recall of ads dropped from 34% in 1965 to only 8% by 1990, and even further since. One of the difficulties of this situation is that the audience has become so much more sophisticated, and so modern marketing means, as Andrew Keen argued in The Cult of the Amateur, advertising without seeming to advertise whilst maintaining an aura of authenticity. Figuring out new ways to get marketing messages through to consumers has never been more important, which is why Digital Marketing has become such a hot topic for marketers. Digital Marketing sites like Facebook, Twitter, YouTube (left), and Foursquare now function as hubs for the internet instead of chasing across the internet, marketers can use a relatively small number of Digital Marketing services to reach large numbers of potential customers. This concentration of the audience has driven increasing amounts of advertising revenue to the social networks, with Facebook having overtaken Yahoo as the biggest publisher of display ads in the United States earlier in 2010. Indeed, in 2010 Facebook is predicted to earn $1 billion in advertising revenue.

5. Brands in the Social Space.

SOURCE: Hewitt-Taylor (2001), p.41-42 Pitta et al (2006), p. 421

Kozinets (2010), p. 9. The full quote on what netnography does is worth reproducing here: We gain deep insights into who our customers are, where and how they find sources of community, who are the most influential voices in those consumer communities, what are the meanings, rituals, and traditions of those communities, and so on. With analysis and interpretation, we discover the variety of forms and the patterns within how and why we consume. Story & Hess (2006), p. 406 One of the great advantages of Digital Marketing to marketers is the opportunity it offers to them to interact directly with their customers as individuals, and therefore see their customers as real people in all their complexity, and not just as statistical abstractions cobbled together from market research data. Market research is very good at creating profiles the phantasmic average consumer who is, say, a 35 year old woman, married, two children, living in the Midlands and the buyer of two boxes of Cheerios every week. While these profiles are useful, they also carry the riskof lulling the marketer into a false sense of security after all, the profile is nothing more than a statistical average, and is not representative of the full range of customers, let alonepotential customers. If the profile drives marketers to concentrate their resources on a particular idea of the customer, then they may be missing out on many other opportunities. Of course, qualitative methods have always had a place in marketing, and for decades researchers have used qualitative methods to uncover the meanings and values attributed by individuals in real-life situations, with idiosyncratic and personal views forming an important part of the overall picture. Nor is the concept of getting close to the customer a new one; marketers have been using information technology to try to learn more about their customers as individuals since the 1980s. What makes Digital Marketing different from traditional market research is that it offers the possibility of ongoing, unmediated two-way communications between the brand and its customers. At the highest level, this can involve the application of techniques gleaned from anthropology to using Digital Marketing to learn about the customer, an approach that Robert Kozinets of York University calls netnography. Kozinets argues that netnography can provide a window into the

realities of consumer groups as they go about their lives (allowing us to) gain deep insights into who our customers are. In many ways, this focus on relationships represents a challenge to the traditional datafocused nature of most customer relationship management (CRM)frameworks.

6.The Role of Influencers

SOURCE: Rosen (2006) Li & Bernoff (2008), p. 97 Gladwell (2002), p. 69; Gladwell calls them mavens, but the term is essentially inter-changeable with influencer A key element of any Digital Marketing strategy is engaging with influencers. Influencers are those individuals who, for reasons of their particular charisma and/or knowledge, others look to for information and advice. In The Tipping Point, Malcolm Gladwell makes the point that they are information brokers who have developed a particular facility for persuading others to trust their opinions. Although such people have always existed, relatively few of them have had a platform to influence large numbers of other people, since historically there have been only a limited number of paid positions available for critically appraising movies, music, consumer goods, cars, or other products and services. What makes Digital Marketing so revolutionary is that it offers anyone who may want to share their opinions with the world the ability to do so. According to a 2010 report by research firm Gartner, 20% of the globes Digital Marketing audience could be defined as influencers. In order to best use the talents of these individuals, Nick Ingelbrecht, research director at Gartner, advises that: Companies attempting to use Digital Marketingshould develop relationships with key customers over a period of time and progressively refine the socialnetwork profiles of those individuals In this way, the most suitable individuals can be targeted with the right information, products and promotions in the most cost-effective way. In an April 2010 article for leading Digital Marketing blog Mashable, Ben Straley of Meteor Solutions reported that on average 1% of a sites audience generates 20% of its traffic these are the people who share content, who push others to

the site, and, ultimately, help put money in the brands pocket. Deepening your relationship with these influential fans is afantastic way to improve Digital Marketing performance, but it does require caution, since an overly salesy approach may alienate them. Instead, it is necessary for brands to understand their influencers what motivates them, as well as what kind of content they like to share. As Straley points out, For most people that spend time creating and sharing content, its not about fortune, its about fame. They share links with friends and their wider social network because it makes them feel important, special, and useful. The other risk with targeting the sub-section of influencers known as early adopters (those individuals who are first to pick up on new products or services), is that they tend to possess higher standards for products and the companies behind them49, and they are not shy about spreading the word if they feel something is not up to standard. Even though influencers can do a great job of spreading the word about a brand, they are not a miracle cure. According to Mark Borkowski, founder of the PR agency Borkowski, an influencer strategy wont work for a weak brand, and, as he says.

7.Measuring Success
SOURCE: Warc.com (2010), Influencers make up 20% of Digital Marketing audience Straley (2010) Ad Age Insights (2010), Shiny New Things, p. 13 Roberts, Jo (2010), p. 17 One of the trickiest tasks in Digital Marketing is defining success. Since Digital Marketing is so new, there are not as yet any universally established metrics for measuring the effectiveness of Digital Marketing campaigns, and so there is quite a diverse range of ways in which practitioners judge the success (or not) of their work in Digital Marketing. As an example, in a 2009 article for the Journal of Interactive Advertising, Chris Murdough listed three main areas of measurement for marketers working in the social space. The volume of mentions on the social web and where they are occurring

 What are people saying about the brand? What topics are they discussing, and is it what the brand wants people to talk about? What is the level of engagement from social web efforts? Can this be linked to actual sales? In his book Engage, Brian Solis of FutureWorks says that Return On Investment (ROI) should not be a crude financial measurement, but should also measure the return on participation (the activities associated with the campaign), return on experience (in terms of engagement), and return on influence (how the message spread across the social web and impacted on individual behaviour). The difficulty of developing effective metrics for Digital Marketing marketing was illustrated by a 2010 paper called Measuring User Influence in Twitter: The Million Follower Fallacy, which illustrated that the number of followers of a Twitter account was unrelated to how influential that account actually was. Since follower numbers has been a key metric for many companies looking to market through Twitter, this was an important revelation. Many brands strive to build their follower numbers, or they advertise through well-followed users, but these users are not necessarily the ones who have the most influence within the network. In the absence of any universally agreed method of measuring success in Digital Marketing marketing, it is worth looking briefly at Wieden + Kennedys recent campaign for Old Spice deodorant (left), one of the most successful Digital Marketing campaigns ever. The campaign took Wieden + Kennedys tonguein-cheek Smell like a man, man Super Bowl advertisement for Old Spice and brilliantly extended it into the social space. What W+K did so well was to use a variety of Digital Marketing tools in a way that took advantage of the strengths of each in order to create a multipronged approach that hit consumers at a variety of touchpoints. W+K solicited questions from Twitter users, which were then responded to by the main character in a series of short YouTube videos. Through the use of humour and direct engagement, W+K were able to attract over 100 million views to the various videos a success that translated into a US sales boost of 107% in the first month.

This campaign is an excellent example of how Digital Marketing can be used to market FMCG goods, and there are a number of lessons that all brand managers can take from it:

that they will want to share

Increase in Profit after the Implementation Of Digital Marketing

Advertisers forecast that Digital Marketing will represent a growing share of their overall media budgets over the next two years, especially within the FMCG sectors. The EIAA Marketers Internet Ad Barometer, commissioned by the EIAA to understand the role Digital Marketing advertising plays and attitudes towards the Internet amongst key advertisers across Europe, reveals that 42% of those questioned already spend over 5% of their media budgets Digital Marketing and 74% of all those surveyed regard the internet as a vital component of their advertising strategy. According to 80% of respondents, increasing broadband penetration is making the Internet more attractive as a branding medium and Digital Marketing ad spend is forecast to rise by over 65% by 2012.

Number one company among FMCG is Coca-Cola (22M fans). Coca-Cola isnt only the biggest company on Facebook among FMCG but also the number one brand on Facebook overall.

Second position belongs to popular biscuits Oreo (16M fans). Oreo is closely followed by Red Bull (15M fans) and Skittles (15M fans). These two brands have very similar Fan Growth rate as you can see on the following graph.

FMCG Brands
FMCG brands are demonstrating strong signs that they are embracing Digital Marketing. The research showed that the percentage of overall media budgets devoted to Digital Marketing are forecast to rise from 5.6% in 2005 to 9.8% in 2008 - a massive 75% growth rate. Internet advertising expenditure will experience a boost by both the higher and lower spenders of the sector over the next two years, with the higher spenders stating that 64% of this extra spend has come from other media budgets and 57% of respondents claiming the spend has been diverted from TV advertising.

Taking Share from Traditional Media

The research reveals that Digital Marketing is chipping away at the heartlands of the advertising market, especially amongst the higher spenders. FMCG companies are siphoning spend from TV advertising while Entertainment and Consumer Electronics companies are reallocating budget to Digital Marketing primarily from TV and print. Travel is also diverting ad spend from print while Automotive advertisers are taking share from across the media board.

Maturing Attitudes: Higher vs. Lower Spenders

The survey highlighted other marked differences between those who already spend significantly Digital Marketing (6+% of media budget) and those who are catching up (1-5%). The lower spenders are driven primarily by increased use of the Internet while the higher spending Digital Marketing advertisers place greater importance on the mediums reach and share of voice. Higher spenders are also more than twice as likely to view Internet advertising as essential to their overall advertising strategy and see Digital Marketing as having a greater influence on sales, intent to purchase, profitability and market share.

RESEARCH METHODOLOGY
Research Design
This is a descriptive research as it will clarify the doubts about Digital Marketing advertising. It will give us a clear picture on the effectiveness and reliability of Digital Marketing advertising compared to traditional form of advertising.

Data Collection
Secondary Data: Digital Marketing reports related to Digital Marketing advertising. Primary Data: Questionnaire, Personal Interview, Interview with Marketing Professional.

Sample Universe
Basis of Sampling Sample should be a user of internet or should have knowledge of internet. 50 numbers in all.

Sampling Technique

Judgmental Non Probability sampling can be used to select the individual units for better productivity of the questionnaire. A well educated person may be able to reason out the questions in the better way.

QUESTIONNAIRE
Name:_______________________________________________ Age Group (yrs): 40 to 55 Gender: 55 + Male Female up to 18 18 to 25 25 to 40

1. Do you like Advertisements? Yes No

time

2. How much time do you spend? TV, Movies > 6hrs Newspaper, Mags > 6hrs Radio > 6hrs < 1hr < 1hr < 1hr 1 - 2hrs 1 - 2hrs 1 - 2hrs 2 - 4hrs 2 - 4hrs 2 - 4hrs 4 - 6hrs 4 - 6hrs 4 - 6hrs

Internet > 6hrs

< 1hr

1 - 2hrs

2 - 4hrs

4 - 6hrs

3. Do you watch the TV/Radio commercials during commercial break? Yes No

ng

of time

4. I change the channel during commercial breaks Never sometimes depends on ad often every time

5. Which is the last Newspaper/Magazine ad you remember? Which brand was it? ________________________________________________________________ ______

6. Which is the last FMCG TV commercial you remember? Which brand was it? ________________________________________________________________ ______ 7. Name any five FMCG TV commercials you remember lately 1. _______________________________ 2. _______________________________

8. Do you see/check Digital Marketing FMCG ads/mails when you surf the internet? Never time sometimes depends on ad often every

9. Which is the last FMCG Digital Marketing ad you remember? Which brand was it? __________________________________________________________

10. Name any five Digital Marketing ads you remember lately 1. _______________________________ 2. _______________________________ 3. _______________________________ 4. _______________________________ 5. _______________________________

11. You use the internet for.. (Rank them in order of your preference)

-Commerce

12. What mode of advertising influences you to buy/suggest any product?

Digital Marketing advertisements Digital Marketing Blogs, forums, Social Networking site.

13. Which mode of advertising would you prefer? (Rank in order of preference)

Digital Marketing Ads: Banners, Emails, 14. Which mode of Advertising would you trust? (Rank in order of preference)

spapers

Digital Marketing banner ads

15. You cannot live without (Rank in order of preference)

16. Do you think that the face of advertising is transforming in terms of technological and cultural impact? Yes No

DATA ANALYSIS

CONCLUSIONS

Digital Marketing ad spending expected to grow substantially over the next 3 years by 2015. FMCG and entertainment brands planning significant Digital Marketing spending. Advertisers diverting spend from TV and print media to Digital Marketing. Digital Marketing terminology and campaign measurement no longer perceived as huge barriers. Digital Marketing advertising builds brands! When measured in isolation, Digital Marketing advertising has a positive impact on traditional branding metrics like awareness, message association, etc. Branding metrics continue to increase with additional exposures Digital Marketing advertising works in FMCG a category whose adoption of the Internet trails other Industries. Digital Marketing advertising offers potential benefits like target ability, tracking, deliverability, flexibility, etc.

Today Digital Marketingis a byword in Indian society and it has become an integral part of our daily life. There are websites providing any number of goods and services. Then there are those, which provide a specific product along with its allied services. Indian Digital Marketingportals provide goods and services in a variety of categories. To name a few: Apparel and accessories for men and women, Health and beauty products , Books and magazines, Computers and peripherals, Vehicles, Software, Consumer electronics, Household appliances, Jewelry, Audio/video, entertainment, goods, Gift articles, Real estate and services . The total Digital Marketing transactions in India was Rs. 7080 crores (approx $1.75 billion) in the year 2006- 2007 and expected to grow by 30% to touch 9210 crores (approx $2.15 billion) by the year 2007-2008. According to a McKinseyNasscom report the Digital Marketingtransactions in India are expected to reach $100 billion by the 2008. Although, as compared to the western countries, India

is still in is its initial stage of development. E-Marketer forecasts that Digital Marketing sales will more than double by reaching $168.7 billion in 2011. Market share is moving toward Australia, India and especially China. The emergence of blogs as an avenue for information dissemination and twoway communication for Digital Marketing retailers and DIGITAL MARKETING vendors environment and help prevent credit card frauds, identity thefts.

REMAINING AREA OF STUDY

MARKETING FMCG THROUGH MOBILE

References
Competition in B2C eCommerce: Analytical Issues and Empirical Evidence Stefan W. Schmitz and Michael Latzer Entering the first century : competition policy in the world of b2b electronic market places A report by federal trade commission staff 2000 The CPI Antitrust journal July 2010 Maximizing competition in the case of two sided markets Intl Roundtable on Trade and Competition Policy & Squire Sanders & Dempsey, LLP Shanker Singham, & Kaushal Sharma, Competition Commission of India Digital Marketingand its implication for competition policy Discussion Paper 1, August 2000, a report compiled by the Frontier Economics Group for the Office of Fair Trading Perfect competition : From myth to reality Yogesh Upadhyay & S.K. Singh Legal and Policy Framework for Ecommerce in India Nishith Desai Associates, www.nishithdesai.com The Future of Charge Card Networks Robert E. Litan and Alex J. Pollock, Working Paper 06-03,February 2006 49