12 Marketing Trends for Sri Lanka in 2012

*Marketers ready for the challenge?


By Thanzyl Thajudeen

2012 is a year that will challenge marketers in Sri Lanka as despite the country’s impressive 8.4% growth that was recorded during September 2011 and the fantastic figures of tourist arrivals (855,975 as of December 2011); there are heaps of bumps along the journey. According to a mind-blowing analysis carried out during last month by UBS Securities Asia Limited published on the Daily Financial Times, Sri Lanka on April 2, 2012, it stated that Sri Lanka is now subject to economic overheat and that interest rates in the country will go up to another 150-200bp to reflect the much wider external gap and higher headline inflation in prospect.

Commenting on the country’s inflation, it stated that the headline inflation has slowed to sub-5% (2.7% February, 2012) from a peak of 8.8% in April, 2011 – this is mainly due to food inflation slowing; suppressed transport costs despite surge in oil local fuel tariffs; exchange rate being stable, or appreciating for a while; and the expectation of a lag between excess demand and inflation. But however, it’s now a nightmare for brands and organizations as the report warned that 2012 could turn out to be the opposite – as we have noticed, the recent rise in taxes of all essential goods; the increasing transport costs; increased prices of petroleum products; depreciating exchange rate; higher pricing power due to the effect of rapid credit growth; and so on.

The securities firm is predicting a real GDP growth to slow to around 6% in 2012 from a number likely to be close to 8% in 2011. From my knowledge, marketing is very closely related to economics, and whoever masters is economics are gurus of marketing. So this year it demands marketers to be Chief Economists of their organizations and brands, and I’m positive that a majority of the marketers have no clue or knowledge about economics – so let this year be a thought provoking year for marketers in Sri Lanka to critical understand that this subject is core to marketing – and of course, not ‘sales, sales and sales’ – take up an executive education programme in this subject, meet and socialize with fellow economists in Sri Lanka, read plenty articles and bulletins from various sources, keep track of the economic and inflation rates in the country, conduct various customer and market research, and so on – quit sitting on the boardroom or impressing your employers with technical achievements, it’s time for some serious marketing.

1. Organizations will increasingly adapt to analytics and insights

The country is increasingly experiencing a shift in consumers’ habits and preferences influenced by various set of factors that marketers need to track. Unlike those days, there is no more an option for organizations to just carry out a range of marketing programs that they think might work in the market (being internal oriented) without having to consider the market forces. However, the climate seems to have changed dramatically and research-based strategic decision making will be the sole component that will add value to the company’s profits and sustainability in the long run.

Different regions in Sri Lanka will require different set of insights out of which marketers will need to formulate relevant, hybrid strategies that will match the market. Niche players will have an added advantage to get even closer to their prospects and consumers. As the sector gets more competitive, marketing ROI is critical to its progress of success and various analytical and monitoring tools will be deployed either by having an internal set of team or by appointing a specialist agency that will work in confidentiality.

I predict that marketing ROI will rule out the whole board in these organizations with the below stated trends, and increasingly executives will understand that these new ROI are today’s tools and are the ones that promise sustainability - this means marketing accountability.

2. Marketing education will take a ‘local’ approach

Currently, it’s visible that the country boasts a rich higher education when it comes to marketing and communications. Though the Chartered Institute of Marketing’s, the leading body for marketers, has its presence in Colombo, it cannot produce leaders in the community independently. Others members of the society including various universities and colleges those initiated and run by both the public and private sectors will have to create strategic partnerships and offer marketing qualifications or formulate their own curriculum and syllabuses that will match their student bases.

There will have to be many local insights and knowledge integrated into the curriculum whereby giving those students the ability to understand the local markets how it works on a practical scenario backed up by global case studies and practices. This will break-out the perception that these qualifications are not anymore European or elsewhere. I have learnt that the reason behind why marketing education is lacking in the country purely is due to the missing of a local framework that has not been adapted, and currently many academics and members are realizing this fact and are said to take initiatives during the next year. This will also increase the amount of marketing professionals in the country who are ready to serve brands and organizations with their local knowledge and skills they have acquired from their education and qualifications. It will also further attract prospects outside the border.

3. Marketers will play a major role and be recognized as strategists

Despite the fact that marketers are of course playing a major role in various sectors throughout the country, they have still not being recognized. With the increasing efforts and initiations towards marketing knowledge during 2012, the marketing fraternity will experience the recognition it deserves and various other stakeholders including the society will appreciate.

It’s just a matter of time that this will be revealed. With the increasing importance of marketing, and how it evolves around businesses, it can be conclusive that marketers will take over the board room. Historically, it has always been the finance and operations guys who dominated the Sri Lankan boardrooms - this is not the case anymore - with executives and investors increasingly understanding and feeling what marketing is really about - they will give high priority to marketers.

Marketers in today’s world need to be everything – not only from the traditional sales, marketing, communications, and business development – but from turnaround executives through to leaders in ethics and governance. This will be a major trend in 2012 that will be realized.

4. Marketing careers will surge, sales careers will remain but decline

Along with these trends, careers in the marketing discipline such as marketing management, sales, marketing communications, digital and social media, branding and corporate communications, market and marketing research, marketing analysis, reputation management, etc will slowly surge in 2012 although it might not be much but it would be a foundation year that will set years to come. It has always been about ‘sales’ in Sri Lanka when it comes to defining the term ‘marketing’ however this it will be realized that ‘sales’ is not the answer.

Organizations locally will enjoy recruiting the locals in those regions who have higher understanding of the whole scenario whereby reducing the practice of recruiting international prospects that requires higher investment in trainings, etc. Jobs and career ladders will rotate internally and will reduce the chance of them having to migrate their expertise and skills to foreign destinations.

5. New media will play a critical role in agencies’ strategy

As the country hits 2.5million internet users (that is 11.8% internet penetration) by end December 2011 according to International Telecommunications Union (ITU) data, brands and organizations will turn out to leverage and carry out various marcomm programs on this new medium. This in turn means that those conventional or traditional advertising agencies will have to adapt to a new business model where it will need to have a new Digital unit.

According to the ‘Digital and Social Media Study [Agency side] in Sri Lanka’, taking into account 22 respondents that consisted senior key executives throughout agencies in Sri Lanka such as Chairman, CEO’s, COO’s, and directors and managers involved in branding and client services, conducted by Mark & Comm Limited, during February 2011, the report stated that ‘When surveying about the critical tools the agencies will use in the future and to meet the requirements of their clients’ demand, the new media – Social media, Online advertising, and Blogs and Forum along with Email marketing was highly scored yet with traditional such as Outdoor, Television & Radio, sponsorships and endorsements, as well as print still remaining high.’

It further stated ‘Social media was scored 95 percent as important; Blogs and Online forums hitting up 82 percent as important followed by 14 percent stating it’s somewhat not important and 4 percent stating not applicable; 86 percent responded that online advertising is important with 14 percent stating it’s somewhat not important; 69 percent stated Email marketing is important followed by 23 percent stating it’s somewhat important and 10 percent stating not at all important or applicable; Outdoor caught a 86 percent importance rate with 4 percent stating its somewhat important; a 95+ percent stated that Television and Radio as well as the Print medium will continue to remain as a priority tool along with sponsorships and endorsements gaining a 83 percent importance rate with 18 percent stating it’s somewhat not important.’

This is an opportunity that is currently trending and will continue to further trend in 2012. Those agencies that have already realized and moved onto this new revenue stream are enjoying the first-mover advantage in the country but only until those SMEs and other multinationals with branches and alliances in the region start competing with them. This will be a competitive market and players are required to play it fair and safe.

6. Entrepreneurs and startups will capture the niche

Although those big firms will capture markets across various regions, the increasing promise of entrepreneurs and startups in the country will capture those niches and serve more closely. As the economy is starting to appreciate and realize how much entrepreneurs are contributing to its value addition and the fact that they are tomorrow’s leaders and decision makers, entrepreneurs will enjoy resources and support increasingly from the private investors and venture capitalists – although I declare ‘not much’– on the contrary - I’m positively not promising the public sector and foundations that are merely a publicity stunt – also which has very high documentation procedures, strict criteria adherences, idea and initiative limitations, and so on.

This segment is said to be more energetic, encouraged, and risk-takers with a vision to achieve their dreams by offering innovative products and services that best serves consumers. It exhibits more risk-taking levels than those big players who cannot afford to do that. For some, 2012 will be a successful year whilst it might also be a trial-and-error period, but the fact here is that both are the same. Either winning or losing, it’s a sprouting signal that says they are building up their grassroots to become well groomed to serve tomorrow. And those who will take up a niche marketing approach will succeed in the long run and of course win in terms of long term profitability, competitiveness and sustainability in the marketplace.

7. PR will still remain immature, but will provoke thought

Unlike other countries when it comes to Public Relations, Sri Lankan PR agencies definitely have no idea about what PR means or in that case even draft a very catchy press release to their client. On the other hand, it is also the lack of knowledge about PR among clients and brands as they are just happy with what the agency does – merely carrying pictorial publicities and very technical releases. PR professionals are required to do their own research, and come out with press releases that will match their local motives as there could be many potential brand damages that could cause if it reaches on a wrong perspective. It is understandable that PR plays a critical role in branding and stakeholder relationships along with increasing emphasis on reputation management hence PR professionals may have to be careful out there.

This would mean that PR will have to be formulated after a strict research and look-out on these local contexts, and this will further mean that firms and agencies will have to invest more time and efforts on understanding the locals. They will need to give ears and watch out closely.

8. MarComm agencies will have a Research & Intelligence Unit

As stated on my first trend, organizations will move into being using analytics and insights on their decision making process. Agencies will have to invest and train people onto this arena before it’s too late, and this will trend during 2013 for some extent. Marcomm plans and campaigns are not just prepared overnight by being blindfolded; it’s now taking a very heavy process from studying behaviors and attitudes, perceptions through to market conditions, effectiveness of tools, analytics and budget set, and so on.

This will mean that agencies have to set out a specialist unit and keep this factor at the core of their business model and strategies; it has to be central to any client proposals, operations, etc. They will have to be skilled with research knowledge and have a continuous rigorous process in this area which will lead to being equipped with the latest happenings, up-to-date and evolving insights. However those who will not realize this critical factor will continue to be very short term and will have to eventually quit off from the competition.

9. Mobile will play a big role in marketing

Mobile subscribers have reached a total of 18.417mnin Sri Lanka by September 2011, according to data from the Central Bank of Sri Lanka (CBSL) which was also later revealed by the Telecommunications Regulatory Commission of Sri Lanka (TRCSL). The mobile penetration rate is well over 85% meaning that there is an opportunity for all those brands and organizations out there including those mobile network operators (MNOs) themselves.

As the mobile category is taking a dramatic shift globally with recent introductions of new models; speeder internet connections mainly those broadband ones - after attracting interest from companies such as Sri Lanka Telecom, India’s Tata Communications and Mahanagar Telephone Nigam Limited, as well as UAE-based Emirates Telecommunications Corporation in the last few years, Suntel was finally acquired by Dialog Broadband Networks (DBN), a wholly owned subsidiary of Dialog Axiata in December 2011; cheaper packages; increasing mobile applications; increasing usage of social networks through the mobile handsets and smartphones; innovative technologies; increasing creations of m-sites, and so on, mobile marketing will play a major role.

10. Facebook will continue to dominate the Social Media space

When talking about Social Media in Sri Lanka, Facebook will continue to dominate in 2012. Currently, there are 1.21Mn Facebook users in the Sri Lanka, which makes it #74 in the ranking of all Facebook statistics by Country according to statistics from SocialBakers. It also shows that Facebook penetration in Sri Lanka is 5.64% compared to the country’s population and 68.31% in relation to number of Internet users. The total number of FB users in Sri Lanka is reaching 1213340 and grew by more than 99660 in the last 6 months. The largest age group is currently 18 - 24 with total of 497 469 users, followed by the users in the age of 25 - 34. Further, there are 67% male users and 33% female users in Sri Lanka.

The age group dominating will continue to be the 18 – 24 and 25- 34 segments. Brands and organizations especially SMEs will take advantage of this medium by creating fan pages and offering something extra by socially interacting consumers on an ethical manner. This medium will also increasingly be used for marketing research, customer service, and other critical areas as well which will not just strict to Facebook advertising and just having a fan page.

The top 5 brands in Sri Lanka, according to SocialBakers, are Anything.lk, Odel, Dialog Axiata, Kapruka and Mobitel whilst the top 5 media brands are Y Fm, KISS 898, Sirasa TV – the people’s channel, Sooriyan FM, and Island Cricket.

Further evidenced by the earlier stated survey by Mark & Comm Limited, titling  ‘Digital and Social Media Study [Agency side] in Sri Lanka’ conducted during February 2011 which went on to state ‘Interestingly, when asking out as to which tools will they suggest their clients taking Facebook, Twitter, LinkedIn and an own Blog site into consideration, Facebook received a 90 percent critical rate followed by having an own Blog site which scored a 57 percent stating that it’s critical with the rest stating that it’s somewhat critical; 36 percent stated that Twitter, the micro-blogging tool, is critical yet with another 36 percent stating it can be somewhat suggested with the rest stating out that it’s not critical; and finally, LinkedIn was on a downside with 41 percent stating it’s not at all critical and not suggested yet with 32 percent stating it’s critical and 27 percent stating  that it’s somewhat critical.’

11. Online reputation management will be priority

What is been spoken in the digital and social media networks are increasingly becoming very critical to a brand or organization as it has a very high impact on its image either directly or indirectly. Many global brands are also appointing a so called ‘Chief Listening Officer’ (CLO) just to handle this. As Sri Lanka is a country with different variations in likes and preferences, along with the increasing usage of internet and social sites, it’s predictable that local firms will deploy experts and specialists or train their existing marketing and IT teams towards gaining knowledge and skills in this arena.

Even if an organization is not having its presence over these online platforms, people somewhere might have mentioned about the organization either positive or very often negative. Even if this will not be practiced during 2012, firms will realize the importance of this fact and in some way make plans and initiations to participate.

12. Tourism Marketing will surge significantly

The tourism sector will surge significantly as it experienced strong growth in 2010 and 2011. During the whole of 2011, there were 855,975 tourists in Sri Lanka, according to the Sri Lanka Tourism Development Authority (SLTDA). Further the country is expecting 2.5 million tourist arrivals by year 2016. Currently, there are around 14, 000-hotel rooms and expect to increase it to 40,000 in the coming years.

According to the press release of SLTDA released on 24th November 2011, Colombo, it stated ‘At the beginning of year 2011 Sri Lanka Tourism launched their marketing campaign named as "Refreshingly Sri Lanka – Visit 2011",with the aim of showcasing Sri Lanka as an Island of new found freedom ; a place where the visitor can experience everything that is refreshing under the sun .With this new branding , Sri Lanka tourism promoted 8 segments encapsulating 8 wonderful experiences which a tourist can enjoy within eight days such as: Pristine ,Heritage ,Bliss, Thrills, Festivities, Essence, Scenic beauty and Wild Life. These eight experiences were further stretched into twelve sub-themes to promote each month of 2011, including beaches, sports & adventure, MICE, people & culture, religious tourism, weddings & honeymoons, body & mind wellness, heritage, nature & wildlife, community & education, culinary and shopping & entertainment.’

 The Shangri La hotel’s entry in to the country is also one such signal that there is high prospect in the tourism industry in Sri Lanka along with various other hotels planning to invest, based on many sources. This would mean the necessity for increased tourism marketing in the country – surging in education and knowledge; enhanced creativity and innovation in branding; effective and efficient mediums and techniques; fulfilling unmet needs; critical understanding and research; and so on.

(Thanzyl Thajudeen is a marketer and visionary strategist, also acclaimed world’s youngest member of the Chartered Institute of Marketing, UK. He also authored the article ‘11 marketing trends in 2011 for Sri Lanka’ which was much enjoyed by professionals, and which made its way to reality during 2011. Tweet him on @thanzyl or email thanzyl@msn.com)

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