The pros & cons of such an action as we see this trigger to a larger systemic change impacting consumer behaviour writes Habeeb Nizamudin, CMO, IPG Mediabrands.
When 80%+ money in circulation of a nation is affected with demonetisation it will trigger multiple changes in the mindset of the consumer and their consumption behaviour.
We focus on the issues that are more long term without delving in the topic of black money, the pros & cons of such an action as we see this trigger to a larger systemic change impacting consumer behaviour.
Some examples of change in behaviour can be decoded from the immediate reactions of the consumers and the challenges they face in the situations they face during the first 100hrs of the announcement. Primary and probably the biggest among them will be the fear of holding cash as they now know that the government can make a change any moment without any notice.
This fear is a powerful trigger to drive behavioural change amongst consumers, in order to overcome such fear consumers will seek out ways and means not to be caught in a such a situation in the future. The flurry of advertising by cashless payment solutions such as mobile wallets, credit cards, retail networks is an indication the change this has triggered.
One can expect more communication from NPCI (National Payments Corporation of India) to educate and allay common fears of the consumers, efforts to popularise the UPI (Unified Payments Interface system) to drive higher awareness and acceptance of cashless payments.
The topic is viewed through the lenses of the following scenarios as all scenarios will be true depending on the consumer / category / market segment that is at the core of each of these scenarios and subsequent opportunities is based on the hypothesis that demonetisation will impact consumer behaviour dramatically enough to affect over 80% of their regular purchases & related transactions.
Scenario 1 - Purchase of goods & services through digital channels
Scenario 2 – Cashless purchases through traditional channels
Scenario 3 – Cashless purchases across both traditional & digital channels
Scenario 4 – Cashless purchases leading to the creation of new channels
The growth of digital channels for goods & services over the last year and their distribution capabilities now has them primed for exponential growth as consumers start looking at the convenience of such purchases.
One the biggest behavioural changes in consumer behaviour can be likened to the introduction of remote for TV, the ability to switch from a brand, experiment with alternatives, try newer products, higher impulse purchases becomes a lot more easier for consumers. Convenience benchmarks will shift to newer levels with consumers seeking higher levels of convenience to surpass previous benchmarks continuously.
Placement of brands on shelves both traditional or virtual becomes even more critical and valuable.
Increased cashless purchases would also lead higher levels of transaction data allowing brands to create new opportunities to introduce customised offering for select consumer segments / market segments, experiment with newer offerings.
Inventory management / channel management will lead to greater efficiencies and also create newer communication opportunities – channel focused communications, beyond the large seasonal campaign cycles. Marketing solutions will have to look at multiple campaigns with smaller footprints.
Media will be pushed to address sharper targeting, faster response, dynamic course correction, maximising ROI with newer definition to ROI I the context of the sales channel, activity time-line, product category & target consumer segment.
Role of digital and mobile media platforms will grow exponentially, mass media will need to own sharper audience & geo segments, DTH, IPTV, On demand viewing platforms such as Hotstar, ZOOT, DITTO TV, Netflix…etc., will become more relevant.
Content segments across platforms will be the new hot media real estate, brands will create their own content real estate or acquire prime content real estate dynamically to match their product inventory on various sales channels.
Influencer marketing will move to micro level influencers for brands, the influencer matrix will become more dynamic, definition of influencers will also become dynamic basis sales channels, time line, consumer / market segment.
Identifying, owning and executing connections at just the right moment will evolve into a critical skill blending data sciences, consumer understanding, market understanding, communication skills, behavioural understanding, technology, creativity in an unprecedented manner.
While many of these are already happening in various parts of the world, none would be as big or as complex in scale as the Indian market. The shift in consumer behaviour pertaining to their purchase habits here could not just be a shift for India from a media & marketing perspective but could also bring about a whole new set of learnings / solutions relevant to the world. This is just the beginning…
The views and opinions expressed in the article are solely those of the author's