The scene opens on a curly-haired damsel driving through a picturesque Vietnamese town. ?Hello, I am trying to drive here,? she says, somewhat irritated, to a jay walker who is in her way. Until Telugu actor Mahesh Babu leaps into the frame and muscles his way into her car. ?Let?s go for a drive,? he says, taking control of the wheel. Turns out Babu is in search of a lost truck. Flashback. He had dropped his bottle of Thums Up and it had wound up in the back of the truck. A mad car chase follows. The damsel is now in acute distress and tries her best to hang on for dear life. Babu gets his hands on the bottle, but jams up the car. The final frame shows him in the hospital, all bruised but clutching on to his beloved Thums Up. ?Neeku Evana Autay?? he says wistfully. In other words, what if something happened to you?
?As much as 20% of Thums Up?s sales come from the state of Andhra Pradesh alone. Mahesh Babu is quite a phenomenon,? says Anirban Das Blah, managing director of CAA Kwan, the agency that does celebrity management for Babu. ?A handful of regional ambassadors in the south control 70-80% of the south advertising market. They are the demi-gods here.?
Blah says that for many years, the south covering the states of Andhra Pradesh, Kerala, Karnataka, Tamil Nadu besides Puducherry and Lakshwadeep had been a missed opportunity for national brands. But that is no longer the case. Southern markets are increasingly making a greater contribution to the sales portfolio of leading national brands and hence the advertising and marketing push has also increased in good measure. ?The treatment needs to be remarkably different and you can?t just have dubbed ads anymore. Localised ad campaigns have almost doubled in size in recent years, vis-a-vis dubbed communication,? says Blah. ?Bollywood stars don?t cut ice. Actors such as Mahesh Babu, Ram Charan, Prithviraj, Surya, Samantha are the hot picks, and hence there is a soaring market for celebrity endorsements which is set to grow at 30-40% annually over the next 4-5 years,? says Blah.
Coca-Cola says that the south is an important market for them and they have customised their marketing strategies to cater to customer needs and preferences. ?While we will be unable to disclose the specifics, we can say that Andhra Pradesh is the largest market for Thums Up,? said the Coca-Cola spokesperson. Also, Fanta is the largest orange flavoured drink in Tamil Nadu, claims the company spokesperson. The brand is endorsed by southern actress Tamannah. The company is also associating with local southern festivals such as Pongal and Sankranti in order to cultivate a deeper relationship with its audience.
?In the past, both brands and agencies have found it difficult to navigate the south. The south has its own pulse. Its own stars. And its own cinema,? said KV Sridhar, chief creative officer, Indian sub continent, Leo Burnett, ?But now the tide?s turning and they?ve realised that they can?t keep running German ads in France anymore. They cannot afford to ignore their southern consumers or the regional brands that eat into their share. They will do what it takes to make a connection.?
The southern markets are growing at a reasonably good rate. From 2004-2005 to 2011-2012, the gross state domestic product of the four southern states has grown at a compounded annual growth rate (CAGR) of 8.81% versus the national gross domestic product CAGR of 8.45%, according to the ministry of statistics and programme implementation. Which is not to say that there aren?t states up north that have a healthy growth rate. Bihar and Gujarat bucked the trend growing at 9.22% and 10.1% respectively.
In terms of per capita income, the all-India per capita income was at R61,654 for year 2011-12. Tamil Nadu?s per capita income stood at R84,496 for the same period while Kerala?s stands at R80,924. Karnataka?s per capita income stands at R69,051 while Andhra Pradesh?s stands at R68,970.
The advertising universe is also expanding visibly for the south and will feed a galaxy of companies, be it traditional advertising companies, media buying companies, branded integration firms or celebrity management firms. Advisory firm Deloitte estimates that the television advertising market in the south was worth R3,210 crore in year 2012 and will touch R4,220 crore by 2013. It will reach R6,540 crore by year 2016. The total size of the television market (which includes advertising, subscription and content) in the south was R12,220 crore in 2012 and will reach R13,790 crore in 2013. By 2016, it would touch R22,540 crore. The overall media and entertainment market in south India is estimated at R21,190 crore and will grow at 14% year-on-year. It is expected to reach R36,005 by year 2016.
A media buyer estimates that if one were to just look at the advertising industry alone and across mediums (not just television), the contribution made by the south was at least R9,000 crore, in a R32,700 crore Indian advertising market. ?This contribution was less than R6,000 crore five years back,? he said.
The era of dubbed ads and shoddy hand-me-downs is clearly over, says the creative chief of a prominent ad agency. Hindustan Unilever Ltd (HUL) has signed up Tamil actors Karthi and Kajal for its instant coffee brand Bru while it has tied up with Vikram and Trisha for its tea brand 3 Roses. Another fast moving consumer goods (FMCG) company Marico has signed up Tamanna Bhatia for its hair oil brand Parachute. Lehar Kurkure has Ramyakrishnan endorsing its brand. Nescafe has tied up with Surya. Dish TV has tied up with Jiiva and
Trisha endorses Fairever. Mahesh Babu endorses multiple brands such as Provogue, Santoor, TVS, ITC?s Vivel, Idea, Mahindra Tractors, etc.
Cosmetics and beauty products maker L?Oreal India says that it is witnessing considerable growth in sales in the southern markets. Satyaki Ghosh, director at consumer products division at L?Oreal India, says that the south accounts for over 20% of their overall sales and is expected to contribute more than 25% in the next few years. The number was far lower in previous years, he adds. ?South Indian customers are very particular about value for money. More so than customers in other markets,? he says.
?Through our insights team, we found out that south Indian men are big consumers of hair colour. We tailored an ad with local icon Srininvas Rao, complete with southern nuances and made available mini packs of Color Naturals, which are far easier on the pocket. This product is priced at R65 versus larger packs in other markets that are available for R155. Needless to say that this product is one of our bestsellers. Another product that does really well is Garnier White Complete endorsed by southern actress Shriya Saran,? says Ghosh.
He adds that it was all a question of figuring out the cultural nuances and the company spent considerable amounts on market research in the south. ?For instance, there is special importance given to home remedies in the southern markets. This is why our Fructis Damage Control shampoo is seeing a rush of sales. It has amala (gooseberry) properties,? he said. L?Oreal declined to share sales figures.
Tata Teleservices says it focusses on creating innovating campaigns in the south with local icons. ?In Andhra Pradesh, we?ve had Telugu superstar Ram Charan as our brand ambassador. And we created various opportunities where our customers could engage with the brand ambassador directly. A recent campaign was launched for our new and existing GSM pre-paid customers where we selected 300 winners across Andhra Pradesh through a lucky draw and they got the opportunity to meet and interact with Ram Charan,? said Gurinder Singh Sandhu, head (marketing) at Tata DoCoMo. ?Our Tamil Nadu circle did tie-ups with the film-makers of Thuppakki and Nanban, wherein Tata DoCoMo gained exclusive rights to use Thuppakki and Nanban brand names for our services and promoted them across key mediums. This increased the brand recall.? Sandhu added that in the past, the company has placed a life- sized cut-out of Illayathalapathi Vijay, their brand ambassador at Marina beach in Chennai.
Brand consultant Harish Bijoor says that the south is receiving the kind of attention that it never had in the past. ?The south is gaining significance in the bottom lines and top lines of companies. The fast moving consumer goods companies, auto companies, finance companies and durables are all realising that you cannot navigate and conceptualise campaigns from Delhi and Mumbai for the south markets. A local presence is warranted. Therefore ad agencies are forced to branch out southwards,? he said. Bijoor pointed out that while national brands were looking at deeper penetration of the southern market, south based brands such as Kalyan Jewellers, Muthoot Finance, Pappachan Group had pan-India ambitions. It?s a two-way street of opportunity, Bijoor remarked.
Which is why marketing communications conglomerate WPP Plc acquired Hyderabad based ad agency Mindset for an undisclosed amount in 2011. The acquisition happened through its India subsidiary JWT and will help serve its southern clients. More recently, Japanese marketing communications giant Dentsu Communications opened its office in Kochi. In April this year, GroupM?s flagship agency Mindshare also opened an office in Kochi. UK media specialist Aegis Plc opened a Kochi office for its media agency Carat at the beginning of this year and in July, its digital company Isobar launched its Chennai operations. Arijit Ray, chief executive of Dentsu Communications said that the new office and talent will help leverage local understanding and knowledge and help leverage new client relationships. ?It?s all about spotting the right opportunity and moving. The Kochi branch is handling two of the biggest retail brands in the region ? Jos Alukkas and Jayalakshmi Silks. There are quite a few brands in the south who are working towards expanding their footprint. Jos Alukkas is a very good example. They are gradually expanding into other parts of India,? says Ray.
He adds that that the other strategic advantage they are leveraging is in the auto sector. ?We have Toyota and TVS, two formidable auto brands, in the south. Suresh Mohankumar, our national planning head and Ashwin Parthiban, our regional executive creative director have extensive experience in the auto sector and have worked with brands across agencies. This is helping us expand our footprint across the sector and in building other brand relationships too,? he said.
Ashish Bhasin, chairman, India, and chief executive, South East Asia, at Aegis Group said that the south had a lot of things going for it. Literacy levels are high, there?s increased spending power because of remittances by non-resident Indians and modern trade is coming in through malls and multiplexes. ?So far, many of the national agencies and advertisers have had a very patronising attitude with regard to the south. There is hardly any digital agency of scale in the region, though the consumption of digital content is high. Same is the case with outdoor. There are so many south based clients looking for better quality service and local presence. There are brands such as Indulekha and Cavincare that are looking to expand nationally and internationally,? he said. Aegis itself is exploring entry into other southern markets. Hyderabad could be next on its radar.
South based agency IBrand says that so far national agencies have only ceded southern territory to local ad companies. But that could be changing now. ?If you look at it, there?s so much happening in the south,? says Mahender K, chief executive and executive director at IBrand MarkComm. ?Lux, for instance, is doing a lot around southern cinema. It?s released a co-branded commercial with Nagarjuna?s film Greek Veerudu. The advert has a short snapshot of a song from the film. It?s also tied up with another Telugu film Something Something, starring Siddhartha and Hansika. Remember the famous Lux ad which had Shah Rukh Khan in a bathtub full of rose petals? There?s a similar scene embedded in the film with Hansika,? he added.
Mahender K also talks about Telugu film Seethamma Vaakitlo Sirimalle Chettu featuring Mahesh Babu, who endorses Levi Strauss. ?The film is a multi-starrer and it had all the stars parading the product portfolio of Levi?s which include Red Loop and Curve Id.? He adds that Santoor is also looking at integration with a mid-sized film which is still under production. The film is being produced by Sangamitra Productions.
His own firm IBrand has been involved with a few placements. The firm embedded a new Korean bike called Hyosung in the film Mirch starring Prabhas. The film has a scene where the father gifts his son a bike. It also did the placement for Airtel in film Eega where a conversation between the hero and the heroine happens entirely via SMS. There is also a bus ride with the cast and the crew where they are interacting with the media while on the move via social networks such as Twitter, just to highlight the strength of the Airtel network.
Vodafone India said that it associated itself with the Kannada film Tony Ek Din Ka Sultan where the focus of the film was the mobile network and how it touches the lives of the characters in a positive way.
Can boadcasters be far behind? Star India has launched a second general entertainment channel called Suvarna Plus in the Kannada language space. Multi Screen Media (MSM) earlier picked up minority stake in southern network Maa Television Network. Its chief executive Man Jit Singh said that MSM is on the lookout for further opportunities in the southern markets that would give them an opportunity to build its network and is open to either starting new channels or acquiring them. In recent days, there has been media speculation whether Viacom18, the 50:50 joint venture of media conglomerate Viacom with the Raghav Bahl-promoted TV18 Group, may buy a residual 50% stake in south based ETV?s regional general entertainment channels (GEC). TV18 already has 50% stake in ETV?s regional GECs. When asked about Viacom?s intent to buy the residual stake in ETV?s general entertainment business, the network declined comment.
There are also regional broadcast companies that are expanding their footprint. The New Generation Media Corp is launching a Tamil GEC named Puthu Yugam. The group already runs Tamil news channel Puthiya Thalaimurai.
Census 2011 figures show that Tamil Nadu households have the second largest TV ownership among all states with 87% of Tamil Nadu households and 76.8% of Kerala households owning television sets. Compared to the all-India average of 47.2%, 70% of households in the four southern states own television sets.
Independent media consultant Paritosh Joshi said that the south was characterised by economic prosperity and strong purchasing power. Brands were eager to reach out to southern consumers, and national broadcast networks were eager to break the hegemony of strong regional networks.
Deloitte Touche Tohmatsu India?s director Sandeep Biswas said that the fervor around the media and entertainment industry in the south was unique and distinguishable from the rest of India. ?The positive milieu in the south was encouraging (broadcast) firms to move beyond traditional boundaries. Many players at a national level are increasingly showing interest to tap into the growing southern market,? he said in a Deloitte report on the south media and entertainment sector.