Financial Daily from THE HINDU group of publications
Thursday, Aug 28, 2003
Selling to the young
AT a recent press conference to announce the launch of the MTV-Airtel pre-paid card, the top honchos of Airtel and MTV posed in front of a jazzy set and then, in coordination, tore open their shirts to reveal a colourful T-shirt underneath. While MTV's Alex Kuruvilla looked perfectly at ease, the Airtel honchos seemed uncomfortable at first, but quickly warmed up as Ranjan Bharti Mittal, Joint Managing Director, Bharti Tele-Ventures, described how important the youth segment is to the company. The 15-24 year-olds that Airtel hopes to tap demonstrate unique usage trends: close to 40 per cent of total usage is at night, SMS usage is up to five times more than other segments, and mobile phones are linked to identity. So the card offers special night tariffs, group SMS rates, happy hours and whacky ring tones. Mittal's young niece, whom he checked the product with, declared it `cool'.
With an estimated 45 per cent of the Indian population below the age of 19 years, it is not just cool - but compulsory - for marketers of everything from FMCGs to financial services to tap into this segment early and hold on to them. Companies that are going beyond funky ad campaigns and one-off promo efforts with MTV or Yahoo! to offer products and services that are tailored for the youth are already reaping the rewards. However, experts also caution that it is important to keep refreshing the offering, and maintain a constant interaction, as the segment is hard to read, and can change alliances - and spread the word through Instant Messenger and Group SMS - in a jiffy.
With the 100-million or so 17-24 year olds in a position to earn money and exercise greater decision-making power in the next few years, "now is a good time to start a conscious `catch them young' strategy to hook into this generation and secure the future", noted marketing consultant Rama Bijapurkar in a recent column. "At the very minimum, it is about making your advertising more young and MTV-ish, but that is only the tip of the iceberg: It is about getting them to experience your brand early so that they begin to develop an affinity for it, so that when they become mainstream consumers, they view you more favourably than others." The larger task, she adds, is to create special `Generation Next' products and services, which are more in tune with them than a one-size-fits all offering. An even larger task would be to become a part of their lives, something that they identify as theirs, or something that understands them better than anything else before, she notes.
Look around, and you will see several examples of youth marketing: SF Jean's new `oil and grease' collection, HBO's `Generation Me' programme slot, Barista's `coffee collection' of Elle 18 cosmetics, Lipton Iced Tea's sponsorship of a Mumbai youth theatre group, and magazines such as Femina Girl, Seventeen and JAM (Just Another Magazine). The usual suspects - the cola majors - have gone beyond catchy taglines and celebrity endorsements. Pepsi has a dedicated `pepsizone' on Yahoo! and premiered its `What's there?' and 7Up Fido campaigns on it. It has an integrated mobile-Internet platform for 7Up, with downloads of picture messages, ring tones, screen savers and wallpaper. The liquor majors have launched an entire segment - ready-to-drink - focused on the young tippler. Bacardi launched Breezer in 2002, and Shaw Wallace recently launched Veba, a vodka-based flavoured drink with five per cent vodka content. Targeted at urban 21-35-year-olds, the companies believe the RTD segment is set to explode, given its youthful, more socially acceptable image.
Certainly, MTV - whose primary audience is 15-24-year-olds and secondary audience is 24-34 year olds - can claim to be among the early movers in marketing to the youth. Since the launch of its India-specific service in 1996, the music channel has extended its dialogue with the youth by way of online, on-ground and off-air activities and research. The channel has music albums, apparel and accessories and a co-branded credit card. MasterCard Asia judged the MTV Citibank Card, launched in April 2001, the best youth programme in the Asia Pacific region. It garnered over 50,000 members in the first 15 months of its launch, and was followed up with a translucent credit card, meant to reflect the "values of clarity and transparency" that are upheld by the youth. It is in going beyond a commercial product that helps connect with the youth: "We are a part of their lifestyle, and come at them from a 360-degree angle," says Vikram Raizada, Vice-President (Marketing), MTV India. "So we're also about the World AIDS Day concert, to which 25,000 youngsters came, and we're about reflecting their concerns on old age, pollution and corruption."
Young by association
Having established its credibility, MTV has also provided a platform for launches of brands such as msn.com, Axe, Bajaj Pulsar and Maruti Alto. Now, consumer electronics major Philips has signed on a three-year marketing collaboration deal with MTV Networks Asia that will target 15-34 year olds, as part of Philips' global Personal Expression strategy. The campaign, `MTV Whatever Things', will kick off in Singapore at the end of this month, and will have on-air, online and on-ground manifestations in seven Asian markets, and specially designed audio and wireless products. Philips India has the Philips Nike range of portable audio systems, or "wearable electronics", including CD players, FM radios, and digital audio players, priced between Rs 900 and Rs 9,500, which are marketed through special campus roadshows and parties. "These products give us a talking point with a younger demographic," says Richa Singh, Assistant Product Manager, Philips India Ltd. "And Philips also wants to be seen as a youthful, youth-oriented company."
This is particularly important for a company that is perceived as older, or catering to an older segment, as in the case of Maruti, TVS Motor, or Kinetic. Maruti recently launched a limited edition of two-door Zen cars, and marketed them as "very private" vehicles with which to "announce your single status." Kinetic and TVS have created a separate category of scooterettes: TVS upgraded its Scooty with the Scooty Pep, with more youthful styling and metallic colours. The Kinetic Zing and Zing Rockin' have a cola can holder, an FM radio and a mobile phone charger; the Zing is priced at Rs 25,000, which makes it affordable to a larger consumer base, says Sulajja Firodia Motwani, Joint Managing Director, Kinetic Engineering.
"Kinetic is a full-range manufacturer, so it is important for us to bring the youth into the Kinetic family early and then keep them through the various stages of their two-wheeler buying," she says. "And, the product lends a more youthful, modern image to the company as a whole."
For the young
Certainly, it is harder for a consumer durable major or an auto company to target the youth because there is a price inflection point, reminds Kiran Khalap, Director of brand consultancy, Chlorophyll. While some companies have tried - like Mirc Electronics did, with its Candy range of televisions - it is difficult to create a lower-priced offering that is also aspirational and desirable. But there certainly is a space for FMCG majors to create youth-oriented categories, like Colgate has done with Fresh Energy Gel, and HLL has done with the Axe range for young men. "Till a few years ago, one-size-fits-all products did well, and very few marketers actually segmented the market. But now they've realised they don't need to do it that way," Khalap says. "In fact, Hindi film-makers seem to have realised the benefit of segmenting: rather than make family dramas with something for everyone, the smart ones are also making slick movies for the urban youth, spending just a couple of crores, and marketing them savvily and recovering their money sooner."
A dynamic segment
Generally speaking, marketers have to provide interactivity, internationality and instant communication, as this segment wants instant rewards, he adds. And, marketers have to keep researching their audience, and keep a dialogue going, as the segment is constantly evolving. For instance, the cola majors are expanding their portfolio of health drinks in the Western markets because the young consumer wants to live healthier now, Khalap adds.
Marketers also have to seek out media that appeal to younger audiences: Yahoo! India has created promos for such companies as Ceat, Pepsi, Airtel and several Hindi films, via the Internet and SMS, in the form of contests, downloads and ring tones. Compared to other media, the Internet delivers a targeted audience and minimal wastage, says Neville Taraporewalla, Director (Sales & Business Development), Yahoo! India, whose primary user base is in the 18-34 age group. "TV is largely a passive medium, so if you successfully leverage the Internet, then the user can interact with the brand and absorb it, which helps the advertiser capture the mindspace of the user," he says. "So to target the youth, companies certainly need to look at the Internet in their media mix - because it delivers a higher, more targeted reach."
Certainly, research in the US, whose population is quickly skewing older, indicates that teens and young adults - defined as 13-24 year olds - now spend more time every day on the Internet than they do watching TV, listening to the radio or reading books and magazines. The study by Harris Interactive and Teenage Research Unlimited said that the 47 million people in this segment spend an estimated $149 billion, 15 per cent of which is spent online, and that their influence on other people is as much as five times their spending. Interestingly, they also engage in other media-related activities while they're online: listening to music or the radio, watching TV or talking on the phone. So the segment thrives on the variety of media choices and enjoys managing, controlling and personalising them. They are also extremely comfortable with media multitasking and juggling more media, making their attention spans shorter and more challenging to capture. Therefore, it is crucial to study them and engage with them before hawking a product or a service to them. Chlorophyll's Khalap also cautions against making "blanket presumptions" about the segment, because they do not prescribe to the archetypes that older people tend to have of them.
Indeed, far too many advertisers assume the youth are irresponsible and just out to have fun, but they are also extremely savvy when it comes to spending, are strongly opinionated, have a high social conscience and are focused on their careers. Marketing to them will require a change in mindsets: as Bijapurkar notes, this generation's attitude is very different toward such issues as consumption vs. savings, accessing credit vs. living within your means, consumption hierarchy and priorities, and even what constitutes a necessity and a luxury. So financial services offerings will have to reflect these attitudes.
"A big trap is the belief that the liberalisation generation will rock to the tune of fun and frivolity," Bijapurkar notes. "But the truth couldn't be further: they are a regular, boring, work-hard generation, in a hurry to achieve material goals so that they can play hard, as well."
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