Making sense of the AIDA model in the digital world.

Let’s face it. Whatever we were taught in colleges and universities about Marketing is of little relevance today. However, though the principles and theories remain the same, their application in the modern marketing world differs.

Traditionally advertisers used the AIDA model of consumer behavior that traces the sequence of cognitive events leading to a purchase decision or other action. For example, in an advertising campaign, one first becomes aware of the product being advertised. After receiving additional information, an interest develops in that product, eventually resulting in a desire to see use it. All of which can lead to an act of buying. The AIDA model is used by marketers as a guideline for creating communications. In a nutshell, the process is quite hierarchical where consumers are led to the next stage through the use of different advertising campaigns.

The problem with above model is that it doesn’t cater for an immediate reaction from the viewer of an advert. Leave alone the huge cost implications of creating different advertising campaigns that cater to the audiences at various stages of the process.

Enter 2011. Digital channels are changing all of that. Now it is all the more possible for advertisers to create an advert which takes the viewer through the entire process of AIDA without having to create additional adverts to affect the audiences in a different stage of the AIDA process – make sense? No?

The above pictures are snapshots of what is called an Interactive video. Intelligent tags allow users to place content within the original video – from images, links and other videos to geo-specific data, links to databases and Flash applications. Combine this with ecommerce and mobile and it adds a whole new dimension to the AIDA model.

In the above example, one first becomes aware of the product that is being advertised. After clicking on hot spots and interacting with the video an interest is developed in the viewers. Price product or any offer information creates a desire for viewers to purchase that product. It can eventually result in an action where the viewers can buy that product with a single click. Remember, all of this is happening at the same time. How cool is that?

So there you have it. With digital channels,  it is not only possible to create content that will make your audience aware of what you have to offer, but at the same time create interest, build up desire and give them an option to act on the advert.

What do you think? Is it fair to say that AIDA model has a slightly different application in the digital marketing world? Let me know your thoughts in the comments box below.

Mobile Number Portability in India and its effects on Telecom brands

India is set to become the world’s largest mobile youth market passing China in 2011 with 281 million activations.  By 2012 mobile owning youth in India will outnumber the entire population of the United States.

Up until this year, mobile operators in India have enjoyed very minimal external threats, but in just a few months Mobile Number Portability (MNP) will be introduced into the market. MNP enables mobile subscribers to change their service providers or their location without having to change their existing phone numbers. If the subscribers are not satisfied with the services of their service provider, they can change their service provider while retaining the existing phone number. This infuses competition among service providers and forces them to improve their service standards to check subscriber churn.

MNP presents a number of new challenges and opportunities for marketers and brand managers to maintain and garner greater share of the youth market. One of the biggest challenges for the them will be to retain the existing customers. According to research from The Nielsen Company, close to one in five (18%) of Indian mobile customers said that they would change their operator if they have the ability to retain their number.  For some mobile services, this news might cause some concern: a quarter of customers of Reliance and Tata Indicom said that they would be keen to change if MNP becomes reality, while 19 percent of BSNL subscribers would do the same.. The Telecom Regulatory Authority of India (TRAI) itself has estimated the porting rate to be at 10% in the first 15 months and 7%, 6% and 5% for the successive three years.

Nielsen Survey

So what does this mean for the Telecom marketers in India? Until now, marketers adjusted their pricing strategies to cut out the competition. However, in the wake of MNP, pricing won’t be the deciding factor. Currently, there are brands who provide 1 paise a second plan, that’s barely a quarter of a cent. Secondly, Mobile companies will be forced to look at technology to retain a greater share of the market. However, the reality in India is that not many people have woken up to the smart phones consumption yet. So that will be another challenge.

I won’t be surprised if brands start following the UK model of phone contract systems, wherein a consumer is tied to a service provider for a certain period of time which reduces the risk of consumers switching between various brands. With the intensely competitive mobile phone market, service providers will have to constantly come up with more exciting offers and greater value-added features.

Social media will play a key role in helping marketers and brand managers to retain a greater share of youth market. Needless to say, brands who adapt this new promotion strategy will have a clear competitive edge. There is a greater need to provide a package to the consumers whereby they could form a network of friends and families and enjoy free SMS, free internet access and the lowest call rates within their network of people.

What do you think the challenges will be? Can you think of how Telecom brands in India can over come the challenges of MNP?

Apple’s ipod dilemma – Why Steve Jobs is a worried man

Much has been talked about Apple’s recent success with ipad and iphone. No doubt, Apple is  doing great with these brands. But it’s time we look back at Apple’s core brand – the ipod.

The phenomenal success of iphone has been at the expense of its ipod portable media players.  The ipod sales growth has slowed down in recent years. The following chart shows the iPod’s decline in percentage of Apple’s revenue has dropped from 55 percent to just14 percent.

Courtesy: http://www.theappleblog.com

So, is the success of iphone and ipad cannibalizing sales of ipod? Well, for starters ipad has a completely different value proposition than ipod. So the ipad will have less impact. What about iphone? Yes, to an extent. The iphone has certainly taken the limelight away from ipod. Why would anyone want to own an ipod when they already own an iphone that provides for exactly the same features as ipod?

Well, that’s only half the story. One might argue that there are people who don’t own an iphone but do like ipod because of its Nano format. Is innovation enough, or is it time Apple refocused on its core product?

The market is shifting rapidly, especially when it comes to the tech scene. So Apple needs to shift the ipod’s positioning to smaller niche users. It should consider playing it to urban gym people. May be to kids aged 10-14 years who do not need an iphone but certainly do have a need to buy an ipod. Use iTunes as a platform, for example, give the product for free but charge a monthly subscription fee to iTunes.

What do you think as consumers? Do you still own an iPod? Do you also have an iPhone and do you use both on a daily basis?