Technology is the biggest challenge and also the biggest opportunity: Ajay Srinivasan, Aditya Birla Group
Ajay Srinivasan, Chief Executive (Financial Services) at the Aditya Birla Group, spoke on the importance of being agile in a volatile and fluid business environment at the launch of the Dentsu Aegis Network exchange4media Digital Report held last week
The launch of the first Dentsu Aegis Network exchange4media Digital Report took place last week in Mumbai. The report looks at the growth of digital advertising, the factors responsible for the growth, and the future of the digital medium and digital advertising.
The keynote speaker of the evening was Ajay Srinivasan, Chief Executive (Financial Services) at the Aditya Birla Group.
He started off his discussion by highlighting some of the common reasons why brands become easy targets for new, agile and disruptive competition.
"If you do not understand your customer, their behaviour or how they are making purchase decisions, then you are running a risk. If you have some products which are much more profitable than others then beware. If your customers are forced to buy the whole product even when they want to use just a part of it then it is time for you to be disruptive," he said.
He further added that brands need to watch whether their customers cannot get what they want, when and where they want it. Another point he raised was about giving consumers the best user experience, which is benchmarked against the best global standards.
"If your business model is such that your fixed costs are way too high and so you have allowed a disruptor to enter and significantly reduce the cost of delivery then watch out," he added. Some other points he highlighted were that brands need to be aware of are high information asymmetry between buyers and sellers, long lead time, the lack of will to retain consumers and long systems and processes that make brands slow and bureaucratic.
"The jobs we do, our health, entertainment and the way we connect with each other are changing at a level we have never seen before. So the biggest challenge and opportunity for pretty much everybody today, I think, is technology," he said. He opined that to truly leverage the mobile-first economy that India is slated to become, brands should take regional language content seriously and tap into the grassroot economy.
According to him, technology interacts with business and brings about changes in five key ways. "Technology empowers the customer with information and choice like never before. It raises the bar for consumer engagement to a completely different level. At the same time, brands today have much better information on customers with the level of data and analytics today responsible for segmenting customers much more sharply and customise products and services, therefore, much more sharply," he said.
Srinivasan also opined that another way that technology is impacting business is by what it does to consumers through changes in recruitment, onboarding, engagement, etc. He said that technology has completely changed the interaction between employee and employer with a number of processes now having become completely digital. With technology making employees more productive, it creates a massive impact on the bottomline of any people intensive company, he said.
The third way that technology impacts business is through product design. "Think about some of the products that exist today that have totally changed due to technology which is now such a big driver for business," he said, giving the examples of the smart phone, online maps, cloud computing and social media.
He also said that technology has led to "democratisation of distribution". By this he meant that technology is not only changing the way brands reach customers through new mediums but also in the way it has made even traditional mediums more efficient through means such as GPS, geo targetting, etc.
The final way, according to him, that technology has changed business is how it has changed the way a business operates, for example, how payments are made today.
"The only way to adapt to a volatile changing world is to be agile yourself," he said. He gave examples of certain innovative products and changes that the Aditya Birla Group has made over the years to leverage the rapidly changing business environment. These include active accounts, using online media to connect to customers with innovative banking solutions, etc.
"In the digital medium it seems that consumers cannot help but shop around. The elusiveness of loyalty suggests to me that brands need to pay much more attention to the moments when consumers are actually planning to buy a product," he said.
Speaking about consumer retention, he suggested that a lot of marketing dollars are spent on acquiring new consumers without enough attention being spent on retaining existing customers, which leads to a "leaky bucket" kind of situation.
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