The Hindu Business Line : Auto majors go aggressive on marketing, raise ad spend

New Delhi June 23 Auto majors are combining innovation and aggression in their advertising and marketing to get on top of the clutter of new launches that the industry is witnessing.

With a dampened sales growth in the passenger car segment and a steady increase in interest rates, new features and new models to augment demand are inevitable. So is an increase in ad and marketing budgets.

Companies such as Maruti, Hyundai and General Motors over the past year have increased their advertising and marketing spends. However, the strategy this time round is to narrow down on the target audience, thus reducing the spillover effect.

Hyundai has increased its advertising and marketing costs by 10 per cent over last year.

"This has been mainly due to new launches and is not being driven by any possible slowdown that we anticipate in our sales due to interest rate hike," said company spokesperson, Hyundai India Ltd.

The company is now looking at increasing advertising on radio and Internet and would also increase state-specific campaigns to effectively reach out to its target audience.

Maruti, that spends roughly about Rs 300 crore every year in advertising and marketing, will also continue to increase its costs to promote the sales of Zen Estilo and SX4. The company said that despite a possible dip in sales in June and July due to the monsoon, it would continue to spend aggressively to increase its sales.

With a new product portfolio, Maruti is now experimenting with communicating through mobile SMS, radio and digital media. The company says it is maintaining a healthy balance between advertising and on the ground marketing campaigns, both of which it expects, would translate into higher sales.

General Motors prefers tactful advertising. " It is not about spending more but using smarter and more effective methods of advertising to reach out to our target customers," said Ms Anisha Motwani, Director, Marketing, General Motors India.

"We use the Internet to create a hype during new launches for promotional activities and to book orders for test drives. We have created a `SRV web chill zone' targeted at the customer profile of our premium hatchback buyers. For Spark, we launched online campaigns," said Ms Motwani, who explained that by advertising smartly she means focusing sharply on the target audience to reduce the spillover effect.

General Motors is currently running an advertising campaign showcasing its brands in cinema halls across major cities. "This helps us to manage our budget effectively, yet talk about our smart product portfolio," she said.

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