Monday, April 13, 2009

Internet Strategy for Indian Politicians

The second most populous nation in the world, India, has a human stock of 1.2 billion people. India also happens to be the world’s largest democracy and the Indian Parliamentary Elections due this April-May will probably be the biggest electoral event in the history.

About 700 million citizens will be eligible to exercise their franchise. 500+ seats, thousands and thousands of aspirants, numerous parties huddles loosely (or tightly) into three (oh no, four. Never mind) fronts. Across the length and breadth of the nation, accommodating almost all terrain possible on planet Earth.

Welcome to the World’s Largest Democratic process!

Despite being a developing country, India takes pride in use of technology in this gargantuan process. Not many developed countries can claim to be as savvy as India is.

What really caught my attention this time was the use of technology by political parties to position themselves as the party of choice. In this case, I am more interested in parties using the Internet. I have seen BJP’s LK Advani on Orkut. My colleague Sonia (not Gandhi) informed me that Congress’ Sonia (this time Gandhi), Rahul, and Manmohan Singh stare you from banners in various website.

Quite surprising! At least, I am surprised.

Why would political parties use the Internet to propagate themselves? The penetration of internet is so low that, in my opinion, it is neither effective nor efficient medium. Internet is medium for the crème-de-la-crème and this number is likely to be miniscule. And most importantly, it is as fragmented as any other medium available.

Let us ponder over the voter base and the reach of different media. We may be able to arrive at a good media strategy for the politicians of country then.

As I had mentioned the voter base of India is around 700 million (meaning people over the age of 18). According to IAMAI, there are about 45 million internet users. We will consider this base 800 million in this article. This is for ease as the IRS studies has taken 12+ population as the sample for its studies on media and Internet as a medium.

According to this report in IAMAI, the number of people who use Internet in India is 45 million. Of the 800 million population, the number of people in the urban and rural India is approximately 250 million and 550 million, respectively. While urban India is savvier, which is no brainer, the Internet penetration in rural India, which is “where India lives”, is abysmally low. In terms of percentages, the total Internet penetration is approximately 6%. Rural India is in decimal figures.

In a stark contrast is the extent of penetration achieved by other media. TV tops at 467 million, publications comes second at 323 million and radio, with its emergence, stands at 180 million.

Some of the leading TV channels, publications and even radio channels can put total Internet penetration figures to shame. Some figures have been provided in this article for you to refer.

So, why are our politicians from the Left, Right and Centre so visible on the IT horizon? Just a small digression, as I write this article, Samjawadi Party has released its manifesto and if I have to believe news reports have decided to shun machines for men.

The problem with media in India is that it is highly fragmented. Primarily, India states have been divided based by the lingua franca spoken in that particular region. For example, Tamil Nadu is inhabited by people who speak Tamil, Andhra by Telugu, Karnataka by Kannada and so on. Each state government over the years has done well in promoting the local culture and language. The role played by local language (or vernacular) medium has to be commended. It will be worthwhile to mention here that according to a study, the number of English speaking populace is only a meager 90 million (maybe it is not meager but the point is that local language prevails). Consider this, Tamil Nadu state has 60 million Tamil (a language which was spoken even before the advent of Sanskrit). Population of Uttar Pradesh (UP), the most populous state in India, is 100 million. The language predominantly spoken in UP and in most part of the heartland is Hindi. Bottom-line, similar to the penetration of Internet, English, Internet’s (un)official language, is pathetically low.

Two, the Indian media is segmented, as it would be anywhere else in the world, based on the content it delivers. General Entertainment channels – Hindi, English, and regional languages, News channels – Hindi, English, and regional languages, Infotainment and Music – channels are primarily English though there are many local language Music channels, Movie – English and Hindi primarily, though regional channels do exist. Internet is also fragmented though the primary use of Internet in India is Mail (91%), Search (76%), Education Information Search (49%) and Text Chat (46%).

And finally, the segmentation based on Socio-Economic classification (SEC). The digital divide is total in India. We have seen that the penetration of Internet in rural India is paltry. Even in urban India where 43 million have access to Internet, the penetration cannot be claimed to be substantial (around 5%). It is no brainer that computer and Internet is used more in the SEC A1/2 section of the society. That again is not big number. Also, I do not think that this section is a large enough vote bank for anyone.

So why? Why Internet? Why are these politicians sprinkling/putting (not betting) their money on banners and ad words? How do they exactly plan to capture votes and imagination of the masses?

As Sonia, my colleague and a strong supporter of the Internet strategy for politicians put it, “it is not for masses but classes. Politicians are trying to reach out to thinkers and opinion shapers.”

Valid point!!! Or is it?

This article is dedicated to Manoj, who commented after reading my piece on differentiation for James Bond, that my thoughts are too frivolous and devoid of any facts or figures. So, Manoj here it goes. I have tried to put as many figures and tried to make this look like a research piece. Thought most is secondary data but relevant.

This article would not have been possible without the help of my very able colleagues who did the research on my behalf. Thanks Sonia, Durai and Rashmi.

If you are interested to read more on Internet in India, please visit

Friday, April 10, 2009

National Readership Studies India - NRS - 2006

Slightly old but still has good amount of information. Check out this SlideShare Presentation:

Friday, April 03, 2009

Differentiation and Segmentation: A Case of Petro Cards

In order to reduce the usage of credit cards, I decided that I will start paying for my petrol bills from cash-in-hand or cash-in-bank. But on the other hand, gaining those reward points was also something that I did not want to give away. Thus, I decided to join one of the loyalty programs run by the petroleum companies.

I did little research, in the limited time I had. I considered the loyalty programs of Indian Oil and Bharat Petroleum. Incidentally, I had used BP’s PetroBonus™ in the past. This time, I thought I will check XTRAREWARDS™, too.

What interested me was how each of the two companies has differentiated their offerings in the areas of Entry Barrier and Usage.

To start enjoying PetroBonus™, one has to invest Rs. 250 of which Rs. 150 is for processing the account and the rest Rs. 100 can be used for purchases once membership is processed. Thereafter, one has to charge the card with certain value (usually multiples of 100s) which can be used against purchases made at a BP petrol bunk. There is a definite lock-in. there is no need to use your credit card or debit card. This card can also be used at the In&Out stores located in many bunks.

On the other hand, the entry barrier to XTRAREWARDS™ is almost nothing. The card is given to you for Rs. 10. For usage, one can make purchases at the Indian Oil bunk using either credit card or cash. There is no lock-in for users.

There are positives and negatives in both the models but I do not think one is better than others are. It is just a differentiated to suit the requirements of customers. It also allows the segmentation of a very homogenous market.

It is nice to see how these two companies have differentiated themselves while offering the same service.

HP also has a loyalty program but I could not analyze how their offering is differentiated.

Well, I went for XTRAREWARDS™ because I didn’t prefer lock-in and I do not seem myself shopping at In&Out stores.

Anyway, the credit card dues remain a problem for now but I do hope to do away with their usage by the end of this 2009.

CAVEAT EMPTOR: There do seem to be some problems with these cards. I had problem with PetroBonus as I thought the guys at the bunk cheat you by swiping more. Then I stumbled upon this blog on XTRAREWARD -