After a disastrous year in terms of sales (1,693) in 2020, Audi India grew 100% in 2021 to sell 3,293 units. However, this was still lower than its numbers from 2019 (4,594) and 2018 (6,463).
Campaign India caught up with Gaurav Sinha, head of marketing and PR, Audi India, to learn how the German auto manufacturer is looking at different methods of marketing (including a different take on influencer marketing) and electric vehicles to achieve growth.
Since the pandemic hit two years ago, how has Audi India altered its marketing? Are you more focused on digital now?
When the pandemic started, it came as a shock not only to humans but to the entire marketing ecosystem.
Fortunately, roughly nine months before the pandemic broke, we had gone aggressive on digital. We had started with AR and VR solutions. We had also launched our app through which we were working on direct connect programmes with the consumers.
The pandemic expedited the change across India for us. While these digital initiatives were happening in around six cities, the pandemic meant we had to do this across the 30 cities we were present in.
A year later we realised there was pandemic fatigue. We saw there was a growing appetite for personalised experiences. We kept in mind all the safety parameters and social distancing and created smaller events with participant numbers as low as 20 people. Those became quite popular and the response and expectations of consumers to those events are much better than how we thought them out to be. That’s the change in customer behaviour we see post the pandemic as well customers want more personalised and customised experiences.
When we talk about digital, it's no longer just about display or a simple online video. We need to use dynamic creative optimisation. In the luxury segment, it is very important for the ideas which you stand for, and not just the lifestyle that you stand for. Often people make the mistake that the consumer is looking for only aesthetics. I always say the consumer is also looking for ethics and so it’s very important what the brand stands for.
Digital versus traditional - what’s the split now in terms of marketing spends?
Pre-pandemic, our digital spends were growing 15-20% YOY. Since the pandemic hit us, that has changed. When it first hit, digital contributed to almost 100% of our marketing spends.
And now, with things opening up, digital is still leading in terms of our overall investment on platforms.
Where we are increasingly spending is on experiential and influencer marketing.
Unlike some other brands, influencer marketing is a unique opportunity for us, simply because the traditional customer and influencer see an overlap.
For other brands, influencers are just a means of communication, but for us, it’s the customer.
Almost all of our recent influencer marketing campaigns consist of customers or became customers post our association. For us, influencer marketing is not the traditional definition of influencer marketing where we are using them just for reach. As they are already customers, it’s a manifestation of who is an Audi customer.
So would all your influencers be customers or do you have pure influencers also appointed for brand campaigns?
In recent times, we have had customers as influencers. We are not going out to traditional Instagram or YouTube influencers.
How do you get your customers to post about their cars on social media? Not everyone would be likely to do so?
Invariably our consumer is buying the car, not as a functional need but to celebrate success. It's a general status in society and it’s a statement you make to the community.
Keeping that in mind, we are seeing that people are more than happy to talk about their purchases. We don’t need to incentivise them to talk about it. Having said all of this, certain people are very cognizant of the value their word holds on social media or public platforms, and there we have to nudge them to talk. That is where the marketing aspect comes in and we inspire them to be a little more vocal about the purchases they've made in their private life.
Does that mean the traditional brand ambassador doesn’t exist anymore for Audi?
No, I wouldn’t say that. We call our ambassadors ‘Friends of Audi’. A brand ambassador tag puts a lot of weight on the shoulder of the individual. I think ‘Friends of Audi’ makes it a little more palatable.
The ambassadorial role in a traditional form is something that most brands are also moving away from. We have many 'Friends of Audi' but in the traditional sense of the word as a brand ambassador, we would have only one, and that is Virat Kohli.
Does that also put less pressure on you? We are seeing instances where celebs get themselves in hot water and that goes on to hurt brand associations too?
To be honest that's not the reason we have the ‘Friends of Audi’ strategy. That risk is always there when you deal with people in any walk of life. It can happen with a fellow employee or any of us who are in a small way in the public eye.
I could write a Tweet that could affect us. I'm not for a minute trying to say that I have that reach, but people know I am associated with the brand and anything I say could end up becoming an issue.
But I don't think you make these decisions (brand ambassador appointments), keeping those negative thoughts in my mind. You look at how an association can be an advantage and what benefits you get.
I think brands are moving away from ambassadors because the aspirational level and the way we communicate is changing.
Earlier, one of the key reasons for having a brand ambassador was that they would provide you with the reach, recall, and break the clutter. Now, the brand ambassador space is so cluttered that you tend to forget who is endorsing what.
The last big launch for Audi was the Q7. How was this launch marketed?
The Q7 is a very interesting product for us. In India, we are traditionally known to be very strong in the SUV segment. The Q7 is the flagship of SUVs.
The Q7 nameplate made Audi synonymous with celebrities, achievers and industrialists. Not so long ago, almost everybody was 'papped' in a Q7. So, it’s a car people understood even without the Audi reference. The new model gave us a huge opportunity to reach out to this TG. We had an interesting mix for the launch. We wanted to see how the pandemic was going before the launch.
While digital was a big part of the marketing mix, we used other media such as out-of-home around airports as air travel increased.
We also looked at direct communication which is traditional WhatsApp communication. Other efforts included showroom walk-ins with micro-events being organised. We looked at display events and sponsorships too. We sponsored small and targeted events where the brand can be showcased.
There's no TV or print involved at all?
No, for the Q7 campaign specifically these two mediums were not chosen.
How does Audi India view TV and print?
We have a TV campaign coming up for the e-tron.
Digital will ultimately overtake overall TV spends by the end of 2023 or 2024, but we believe firmly in the latter as well.
TV provides us with a unique opportunity of not only showcasing great design language but also narrating a story to emotionalise the brand.
Further, the definition of television is changing and evolving. There is a lot of appointment viewing happening across news and sports, but there is also the return of leisure viewing. There is an OTT fatigue setting in. OTT peaked during the pandemic, but now I'm also seeing a lot of people not wanting to make the choice of content they want to watch and instead surf television channels. It’s not a big trend, but I can see that the growth of big OTT players is slowing down.
TV would contribute around 20-25% of our overall marketing spends and would be ranked second, behind digital.
Audi is one of the luxury car makers that have bet big on EVs with five cars in the space. How much would EVs contribute to your sales?
A lot of people state that electric cars are the future. We say electric vehicles are the current. Audi's the only carmaker in India, which currently offers five electric cars.
We have betted heavily on EVs and our head Balbir Singh Dhillon has gone on record and said that we expect 15% of our sales to come from them by 2025.
Globally, our chairman stated that after 2026, any new model that launches will only be electric.
Our portfolio on electric is strong but the sales would be nascent right now, simply because we are operating in the super-premium luxury segment. The e-tron was a grand success and we misread the market and projected for lower demand numbers. So, we couldn’t meet the demand when we launched.
That struggle continues with the semiconductor problem also going on now. This is impacting our overall business with a more pronounced effect on our EV range. For us, the campaign and marketing issue is about building awareness about EVs. It’s not the choice for the future, it’s in front of our eyes.
But the pricing does point towards it being a future trend, with a big difference between EVs and ICE vehicles?
Pricing will dictate terms, but I want to give the example of the Apple MacBook or the earlier Apple computers. They were prohibitively expensive. The game was to showcase the technology and get people into the possibilities. Once people see the technology EVs use, the change will be expedited because the ecosystem will work towards it.
The sales figures of EVs in the last two years are surprising, as seen with Tata.
The change will happen right before our eyes before we could even realise it. It is not going to be dictated by charging infrastructure, it is going to be a result of personal adaptability to the new technology.
When was the last time because of the Government did any change get expedited in India? The economy is people-driven and the Government enables the change. If the Government changes the duty structure, yes, adaptation in luxury would be faster.
But then, just because something is affordable, people might still reject it, if they don't believe in it.
Right now EVs would be at the tip of the iceberg. If you see all the mass car makers, everyone has exhibited their intentions in this direction.
The key for us in marketing is twofold – one is building brand drivers around the electric image of Audi and the second is dispelling misinformation and some of the doubts about which customers have electric vehicles.
We have worked extensively in what we call the customer education exercise. We created a lot of direct communication assets and programs to give assurance to the consumers.
In terms of sales, you sold almost double what you did in 2020 but still fell short of 2018 and before. What are the expectations from 2022?
Numbers are dictated by product availability. A lot of people equate numbers with pure sales in terms of customer acceptability.
This year we started very strong with the Q7. We launched the Q5 in December and ended the year strong. We are already talking about a couple of more new products coming out in the next few months. So, we expect the year to be positive in terms of sales numbers. I wouldn’t be able to comment on exact numbers, simply because of the supply situation.
You also appointed a retail communication agency last year. What was the idea behind that?
The idea is to sharpen the focus on what we are doing at the retail level. We have 60-plus touchpoints at around 33-34 locations.
Sometimes what happens is that when you have a macro focus, some of the last mile connectivity in terms of brand and marketing footprints gets lost. So, to sharpen it and take a dedicated approach there we got in L&K Saatchi & Saatchi. We thought that we needed a separate partner to focus on retail.
But the showrooms work independently, so would it be difficult to achieve the dedicated approach?
We have a peer-to-peer relationship with them. We have a central brand theme that gets followed.
Finally, what would be three big marketing challenges for you?
We need to continue to create engagement with the customer because the accessibility of information and the consumption of communication is so heightened right now for the average consumer. The challenge for a brand like us is to break the clutter and create engagement. We don't have spends to match FMCG or even the fantasy sports players. Yes, we are not present in those categories but have to break the clutter and still create engagement.
Secondly, we get clubbed as a German luxury brand. We need to get our distinct identity.
Thirdly, we have to keep understanding what is happening with media consumption behaviours. We have to closely watch how media is evolving. Digital is not a stream, it’s the mainstream and the rest of the mediums are evolving around it.
Businesses have a unique opportunity to adapt, streamline processes, position themselves for future growth and stay ahead of the competition by investing in marketing, which can be a powerful driver of success.