exchange4media in association with BBC World News presented ‘One On One’ With Matthew Amroliwala, Presenter, Global - BBC World News. Amroliwala was in conversation with Kamal Bali, MD of Volvo India.
The format of the show called for a discussion between Amroliwala and his guest with a healthy dose of audience participation. The topic under was on the theme “How technology in media is fuelling consumerism and innovative brand building’.
The discussion took off with Bali being asked his perspective on the key challenges now facing India with a new government in place and the outlook generally positive. Bali replied by stating that India faces many major hurdles; the main ones being financial inclusivity and inflation. “We have probably the worst GDP per capita. Financial inclusion is going to be a core thing and it is good to see the government starting programs like “Jan Dhan Yojana”,” said Bali. Speaking on inflation, he said that with India going to 8-9 point inflation, we can only tackle it if we go for the root cause. Otherwise, we would just be treating the symptom rather than the actual disease.
Amroliwala asked Bali about what India Inc. wants from the government, to which Bali was adamant in stating that no company wanted sops or tax breaks. “We want a level playing field, we do not want to go back to a license raj,” he stated.
Speaking about the Volvo brand, Amroliwala wanted to know what it takes for a global brand like Volvo to reach across borders and overcome cultural diversity. “Volvo is an about 90 year old brand. Safety and sustainability is the core brand DNA,” said Bali. Answering the query, Bali admitted that there were no “final answers” to the question. “When you go to 119 markets as a global brand there are huge cultural issues. At the end of the day it comes down to the local people. We keep the essence of the brand but we localize a few of our initiatives. “We never compromise on the basic brand values,” he added.
The next question for Bali was about shifts in global marketing trends that are being seen. Bali agreed that there has been a huge difference in how marketers interact with customers in the past 30 years. Giving examples of incidents from 30 years ago, Bali termed the interactions back then as “Choose any colour you want as long as it is black”. “Nowadays the customer wants to engage with you,” he said. One of the reasons for this, he said was the prevalence of social and digital media.
When asked how important was social media for Volvo in India and how the company split its budgets between traditional and social media, Bali said, “In India the penetration of digital and social media is still low. We are not able to reach everyone just yet.” He said that Volvo India spends around 50 per cent on traditional marketing, approximately 30 per cent in BTL activities and around 15-20 per cent on new media including SMM. He highlighted the recent Volvo ad featuring Jean Claude van Damme that went viral with nearly 1 million views. “That video was about precision; something that Volvo survives on,” he said.
Amroliwala also asked how effective was Volvo in terms of broader reach after using social media. Bali replied by saying that they used social media to share their core values and not for direct sales. “It takes years to change perception so you have to take a long term vision. A brand like ours is not built over night. We need to engage with the government and policy makers too. The great thing about social media is that there are no boundaries,” he said.
At this point of time, the floor was thrown open for questions from the audience, which did not disappoint. One of the first things asked to Bali was the future he saw in terms of fuel, with fossil fuels running low and concerns over the long-term damage to environment. “There is a lot of debate going on. This is a topic which involves a lot of stakeholders so the process gets slowed. Volvo is concerning itself with hybrid vehicles (which use 70 per cent electricity and 30 per cent conventional energy),” said Bali. He admitted though that there would not be a future with just one fuel but one with multiple fuel options depending on preferences.
Another audience member queried whether with robotics and automation becoming more and more mainstream, would it make sense for India to go down the same path, given the high rate of unemployment in the country? Bali agreed that this was a valid point. He called it a Catch-22 situation. “The Indian model has to be different. It has to be customized to India,” he urged. Speaking about programs like ‘Make In India’, he opined that the various political parties needed to set aside difference and agree on it.
When asked about how important were CSR initiatives and whether they actually led to increase in conversions, Bali agreed that there is an absolute link with the kind of trust and faith you built with consumers and what you do for the society. Amroliwala followed this up by asking Bali whether it made financial sense. “In the long run you will be a lot more profitable but maybe in the short term you will not earn as much as your peers. But you have to always take the long term view,” he replied.
In response to another audience question, Bali agreed that the fact that negative news always spreads quickly and social media could be a double edged sword and even used for insidious purposes against the brand. “This will always be a challenge with any new technology. On one hand , you now have a huge canvas opening up for you; on the other hand, it could be misused. As marketers, the only thing we can do is seriously stand against it. It is definitely a challenge,” he said.
Amroliwala’s next question was about how difficult it has become to maintain brand loyalty. “Has the advent of new technology and communication changed the concept of brand loyalty,” was what was asked to Bali, to which he replied that people who have been loyal for years will not change just on a whim. “But there are limits to loyalty. If you do not listen to your consumer and if there is a better proposition available for them then you might lose them,” he said.
“The voice of the customer has become so real-time that the organization that does not listen to this changing voice will die out,” opined Bali.
Speaking on experiential marketing, Bali said that Volvo did a lot of experiential marketing. In fact, even earlier he had pointed out that the company frequently sets up experience zones to get people to get a feel of the new auto technologies and features. “For me a brand equals product x values x emotional connect. The emotive connect is very important. The basic fundamentals of marketing do not change. These are Be relevant, Be different and Have a proposition,” he said.
He also opined that professional consumers or prosumers are very important. According to him they can bring a lot of knowledge to the brand as well as a lot of values to the table.