Convergence Between Self-reliance And Globalization Remains A Challenge; Suggestion To Forge Alliance With Gulf Nations In Exploring Oil & Gas Reserves; 43% of brands and marketers in Asia- Pacific still lagging in finding ways to optimize business
At a time when Prime Minister Narendra Modi sarkar’s ‘Atmanirbhar Bharat’ in place, India Inc is finding it difficult to strike a balance between self-reliance and globalization amid looming fears about second wave of coronavirus (Covid-19). Economists and experts feel that India and other nations should jointly do the business globally to recoup from the Covid-19 shock. Doing business globally is very crucial for emerging economies like India as the industrial output and economy were already badly hit by Covid-19, which jeopardized every economic activity since late March 2020. According to a latest survey, over 40 per cent of organizations find it difficult to evolve strategies to optimize their businesses to enhance return on investment (RoI).
Dr Sangita Reddy, president, Ficci, and JMD, Apollo Hospitals, said: “There’s a need for a convergence between self-reliance and globalization, while sustainability and diversity would remain as cornerstones of future growth. I would like to assure our global partners that we are fully committed to ensuring a robust and resurgent future for our Bharat.”
“Today leadership challenge lies in finding convergence between seemingly divergent philosophies of self-reliance and globalization,” observes Uday Shankar, senior vice-president, Ficci.
Towards this, India should explore the potential in social interactions, institutional exchanges and individual preferences by working with other countries. For instance, with Gulf nations, which have closer relations with India over centuries. India and Arab countries, in the Gulf and West Asia, can explore the forging of partnerships and investments to develop the oil and gas reserves in India which would provide win-win solutions, said a senior official from Union Ministry of External Affairs. “We can explore the forging of partnerships and investments to develop the oil and gas reserves of India. Developing the significant fields in Kutch district, Cauvery basin, Mahanadi basin, Hugli basin and offshore locations in the Bay of Bengal will broaden hydrocarbon production and provide win-win solutions longer into the future,” said the MEA Secretary (CPV&OIA) Sanjay Bhattacharyya said at LEADS-2020 on ‘Gulf and West Asia Reimagining Business Beyond Oil.’
Federation of Indian Chambers of Commerce and Industry (Ficci) organized ‘LEADS-2020’, a 4-day Ficci endeavour to evolve a shared vision among global leaders, to reimagine economic growth on the pillars of open economies, self-reliance, economic resilience and multilateralism. Several ambassadors representing different nations, captains of the industry, senior government officials, economists took part in the virtual LEADS-2020 held during October 12-15, 2020. He further said that the movement towards alternate energy sources is leading to a new partnership in renewables adding that India is happy that a number of countries in the region are associated with the International Solar Alliance.
“Collaboration in solar and other renewables, where efficient technologies are being developed, will give a more rounded context to energy security for both sides in the long run,” he added.
Future-Readiness Of Brands
Covid-19 has not only disrupted businesses globally, but also shed light on future-readiness of brands and marketers to drive growth. About 43 per cent of brands and marketers in Asia- Pacific are still finding ways to measure and optimize business, observes a study on India carried out by Germany-based GfK, the world’s fourth largest market intelligence and research organisation. Only 30 per cent brands consider themselves as a ‘game changer’ or ‘champion’ leading through digital transformation.
“The survey findings portray a clear gap between their business goals and the tools they leverage to achieve them. In a post pandemic environment, it is vital for brands to quickly realign objectives, measure effectiveness and lead through digital transformation.” said Karthik Venkatakrishnan, regional leader, GfK. The survey by GfK targeted 144 marketers in 13 countries in Asia-Pacific across several industrial verticals. The findings are based on a GfK commissioned survey with Campaign Asia, titled ‘Branding and Marketing in the New Abnormal’, aimed at assessing how marketing priorities in the region are shifting and will continue to evolve due to the Covid-19 outbreak.
Shrinking Budgets; Shifting KPIs & Priorities
Inevitably, Covid-19 has presented marketers with challenges such as reduced budgets, evolving marketing mix, changing priorities and measuring marketing RoI. Since the pandemic outbreak, 73 per cent have reduced their marketing budgets. Of the 61 per cent indicating a shift in KPIs. The survey further noted that 56 per cent of organizations witnessed digital transformation is increasing as an important KPI to achieve their goals. About 53 per cent of respondents agreed that there is more focus on driving short term sales. 37 per cent of organisations said there is a shift towards maximizing RoI. In terms of new priorities among those surveyed, 56 per cent said it is maximizing marketing RoI and finally, 40 per cent of respondents were indicating that it is brand positioning.
Bhattacharyya further termed human resources as the second key area of ‘our bilateral cooperation’ with the region, particularly in the Gulf and added that Indians were the largest expat community in the region, with 9 million workers and professionals (30 per cent of all expat workforce), who also remitted $48 billion to India, which helped domestic development.
“At the same time, Indian expats contributed greatly to the development of the Gulf and West Asia region and there were wide recognition and appreciation of their role by the Gulf states. In fact, Indians were seen as the preferred migrants in the region,” he added.
He said that the two-way investments can increase significantly, with sovereign wealth funds and portfolio investments from the Gulf region and Indian corporate investments playing a leading role.
“Similarly, diversification of the trade basket beyond hydrocarbons, to include engineering goods, gems and jewellery, precious metals, food products, textiles and chemicals in our exports and new products in our imports can give impetus to our trade relations. The development of joint projects on both sides and in third-countries, stronger corporate presence, expansion of connectivity and people-to-people exchanges can add a new dimension to these ties,” he added. The MEA Secretary said that exchanges between India and the Arab world have promoted deeper understanding and cooperation adding that the business community can develop deeper links, based on each other's national priorities and development plans.
Cultural, academic, scientific and other people-to-people exchanges will promote good will among the people and facilitate economic engagement. The relations that India has enjoyed across the Arabian Sea for centuries can be consolidated with the incorporation of the new winds of change sweeping across our region.
Suffering from Covid-19 impact, about 76 per cent of brand marketers reduced the marketing budgets. Maximizing marketing RoI remains top of mind (71%) followed by driving sales (76%) and brand positioning (36%). Brand marketers have shifted their advertising budgets towards social media (76%) and paid search (64%) in the post-pandemic environment.
Doing ‘more’ with ‘less’ is the new abnormal
The GfK study further finds out that half of the brands across Asia-Pacific are driving short-term marketing activities to seize opportunities while keeping long-term brand-building campaigns live. “This is largely because the pandemic has impacted consumer behavior and their path-to-purchase resulting in a massive shift to e-commerce and altering media consumption habits. With this dynamic situation, brands are trying to deliver next level of omnichannel experience that consumers are demanding,” explains Karthik Venkatakrishnan.
As per GfK study, four out of five consumers said their decision to purchase a brand in future is largely dependent on how brands position themselves during this difficult period. Therefore, in order to reach the target audience effectively, 60 per cent of marketers across nearly all industries in Asia-Pacific have allocated their budgets for social media marketing while 58 per cent used their budgets for mobile advertising and paid search. In a post-pandemic environment, digital is definitely the way forward for brands in the new abnormal.
Across countries, 62 per cent of marketers in Singapore invested more towards public relations, while more funds were allocated for influencer marketing in Thailand and Indonesia. In China, Hong Kong and Malaysia, there was a shift toward live activation due to the drop in COVID cases. In India, 78% of marketers have shifted budget towards social media, which is much higher than other countries in the region. In the digital transformation era, 1 in 2 measure all their marketing activities, but are using basic metrics such as last click attribution (58%), media reach and frequency (57%), shares (51%), likes (49%) and comments (47%).
Nearly 4 of 10 surveyed indicated brand positioning as one of their priorities. Interestingly, 72% within this group currently do not track brand performance. Likewise, 28% said the allocation of marketing budgets is a key concern post-pandemic, a whopping 83% do not use any form of data-driven marketing measurement to drive business growth.
Building Agile Brand
Based on the GfK survey, nearly half surveyed are optimistic of recovery in the next 6 - 12 months. Brands and Marketers across countries intend to understand and engage their audiences effectively: The survey findings reveal that brands and marketers need to have an agile mindset and employ data-driven approach to evolve with fast-changing times.
Equitable Economic Growth
The just-concluded LEADS-2020 focused on challenges for the global economy. Addressing the inaugural session of ‘LEADS 2020’, Dr Reddy said that “to reimagine economic growth on the pillars of open economies, self-reliance, economic resilience and multilateralism, conducting business will become as much a ‘science’ as it is an ‘art’ in an environment where change is the only constant. We need to re-imagine the global economic order.”
Panel of Ambassadors at LEADS-2020 called for an all-out cooperation between countries to emerge from the ongoing Covid-19 pandemic, while showing interest in defining the future of economic relations with India. “The Indian industry has no doubts that India will achieve faster progress, greater prosperity, and stronger development under the leadership of PM Narendra Modi in the years to come,” added Dr Reddy. Ambassadors and representatives from the India Inc said there was a need for a convergence between self-reliance and globalization, while sustainability and diversity would remain as cornerstones of future growth.
Uday Shankar further added: “Increasing reliance on Artificial Intelligence and Machine Learning is the need of the hour, as these will be a gateway for enhanced customer loyalty, as well as business sustainability. Governments and industry around the world have realized that business excellence, adaptability to change, gender diversity and sustainability would be key drivers for decision making towards building a resilient & smart economic framework.”
Several ambassadors from different countries expressed views on collaborated global business is the need of the hour. Dr Ahmad Abdulrahman Albanna, Ambassador of United Arab Emirates (UAE) to India, said, “The pandemic is a watershed moment for the global socio-economic order. Going forward, the two defining factors that will shape how this crisis affects us are collective leadership and coordinated actions.”
Albanna stated that “Covid-19 pandemic would require significant innovation, out of the box thinking and a massive cooperative effort to achieve stable and sustainable equilibrium between economic growth and social well-being. We need to work towards building more inclusive leadership model at the global level.”
Emmanuel Lenain, Ambassador of France to India, said, “we’re experiencing great transformations. I do agree we have a lot of challenges, but don’t think these are new. Challenges have been present all these years.”
André Aranha Corrêa do Lago, Ambassador of Brazil to India, said: “It has never been more important for the like-minded nation to strengthen their international relationships and ensure mutual trust and mutual benefits. We have seen India embrace fundamental reforms designed to weapon up its agricultural resources and alibi sectors to investments like never before.”
“Throughout Covid-19, we have also witnessed the growing capabilities of India’s manufacturing sector. Investing in manufacturing capabilities will help India integrate with global value chains and be competitive in the post-Covid world,” added André Aranha Corrêa do Lago. Barry O'Farrell AO, High Commissioner of Australia to India, emphasized that “Australia and India need to work together to keep the markets open and enhance the resilience of diversifying supply chains. We have to trust our scientists and institutions to restore work order.”
The writer is a business journalist with 27 years of experience