The influence of digitization on the agarbatti industry, from e-commerce to online branding

By Anshul Agrawal

General trade’s resilience amid digital disruption

In the age of digitization, industries worldwide are undergoing profound transformations, and the Agarbatti sector is no exception. From embracing e-commerce to redefining online branding strategies, Agarbatti manufacturers are navigating a new landscape driven by digital innovation.

The impact of digitalization on the agarbatti industry, including e-commerce and online branding, is intriguing. While many sectors have seen a significant shift towards online platforms due to their high value-to-volume ratio, the agarbatti industry presents unique challenges. The low value-to-volume ratio results in high courier costs, making online purchases less appealing. Additionally, fragrance plays a crucial role in purchasing decisions, making it difficult for consumers to experience the scent before buying online. Moreover, with most purchases totaling only Rs. 200-300, the low-value nature of agarbatti products doesn’t incentivize bulk online purchases. Despite these challenges, there’s a growing demand for the convenience of online shopping. We have also established our presence on platforms like Flipkart, Amazon, and Snapdeal, as well as our own e-store. However, this online growth hasn’t significantly impacted traditional mom-and-pop stores, which continue to thrive in the market.

Digitalization of agarbatti advertising

In the era of digitization, the landscape of advertising is undergoing a significant shift, with traditional mediums like newspapers and TV channels making way for digital platforms. For companies, creating and managing brand perception is crucial, and this often involves overcoming entry barriers inherent in traditional advertising channels.

Unlike television advertising, where substantial budgets and production costs are prerequisites, digital advertising offers a more accessible avenue for brands to connect with their audience. With even modest budgets, companies can leverage digital platforms to promote their brand, target specific demographics, and optimize their advertising efforts based on real-time data and analytics.

However, despite the affordability and flexibility of digital advertising, its effectiveness may vary depending on the brand’s existing presence and market reach. For us with a nationwide presence across India, the value proposition of digital advertising may seem less compelling. While digital advertising can offer targeted reach and engagement, its impact may be limited for brands already entrenched in the market.

Instead, for national brands like ours, focusing on maintaining brand consistency, enhancing customer experience, and exploring innovative offline marketing initiatives may yield greater dividends. By leveraging their existing brand equity and distribution network, these brands can solidify their position in the market and drive sustained growth.

Rise of influencer marketing for online branding

Moreover, the rise of influencer marketing presents a compelling avenue for Agarbatti brands to connect with consumers in a meaningful way.

Unlike traditional advertising, influencer marketing offers a more personalized approach, leveraging the power of social media influencers to create engaging content around the product. While the direct impact on sales may vary, influencer marketing can foster positive brand associations and stimulate interest in the product category as a whole. One notable example of successful online branding in the Agarbatti industry is our association with M S Dhoni, who is our brand ambassador since almost a decade now. We have strategically leveraged the image and influence of cricket icon MS Dhoni as our brand ambassador. By partnering with a renowned and respected figure like MS Dhoni, we have not only enhanced our brand visibility but also aligned ourself with values of excellence, reliability, and trust, which are synonymous with the cricketing legend.

Quick commerce and the rise of last-minute gifting options

As per industry estimates, quick commerce grew at a 70 percent year-on-year rate owing to daily needs, spontaneous demands, and celebrations. Recognizing the shifting consumer preferences towards convenience and online shopping, Agarbatti brands can leverage digital platforms to expand their reach. By offering specially curated gift packs, tailored to suit various budget ranges, these brands can tap into the growing trend of spiritual gifting. With gift options ranging from 100 to 1000 rupees, Agarbatti brands can cater to the last-minute gifting needs of consumers, positioning themselves as convenient and thoughtful choices.

Furthermore, embracing quick commerce platforms allows Agarbatti brands to capitalize on the spontaneous nature of gifting occasions, providing consumers with hassle-free access to their products at any time. Moreover, with the resurgence of spirituality and cultural pride sweeping across India, there is a growing inclination towards gifting spiritual products such as agarbattis. Gifting of Agarbattis and spiritual products is poised to become a significant trend, further fueling the demand for accessible and aesthetically pleasing gift options.

Puja products segment is one of the fastest growing segments, as it caters to daily puja needs like pooja oil, camphor, chandan tika etc in the highly unorganised market. Agarbatti is also used for lifestyle purposes nowadays for its aromatherapy benefits and will attract millennials who are keen to use quick commerce options.