Shashank Shrivastava decodes evolving Indian car consumers and auto advertising

Premiumisation, hyperpersonalisation, belongingness, need for sustainability – the automotive industry in India is evolving at a fast pace, as for consumers it is no longer just about buying an affordable car. There are several factors driving demand as consumer behaviour is changing.

Delivering his keynote address at the Auto Konnect – Redefining Automotive Advertising event, 2024, presented by Hybrid in partnership with Adgully, Shashank Shrivastava, Executive Director, Maruti Suzuki India, deciphered the ‘Evolving Indian car consumers and the future of automotive advertising’.

Speaking about his vast experience in the automobile industry, which spans over 35 years, wherein he saw the industry from a very nascent stage to what it is today, Shrivastava noted that India today is the third largest in the world as far as the passenger vehicle industry is concerned, after China and the US.

“Many of the changes that we have seen in the passenger vehicle industry also applies to the automotive industry and also while this is about digital and programmatic, but I will be talking about the entire ecosystem – which means the consumer in India and how they have changed, where does the marketing fit in, and within marketing where is advertising placed, and within advertising, the digital part of it,” Shrivastava said at the outset.

He started off by speaking about the changing dynamics in the Indian auto industry, specifically the Indian automobile customer, which he believed, is the most exciting and insightful subjects to analyse when it comes to advertising strategies. “Firstly I would like to talk about the Indian car consumer, because ultimately whatever you do – advertising or marketing, contextual targeting, personalised banners and so on and so forth – it has to do with the consumers. And in India, one of the biggest shifts that we have to look at is the demographic shift that we have seen. In the Indian demographic landscape, there has been a significant transformation, quite unique to anything else that we have seen so far. Over 65% of the population is under the age of 35 years, and the market now is dominated by younger, more dynamic and tech savvy consumers. This new generation values technology, connectivity, experiences over the traditional form of car ownership. They are looking for vehicles that integrate seamlessly with their digital lifestyles. Moving hand-in-hand with these younger consumer demographics is India’s growing middle class, which is the major driving force in the automotive market. As disposable incomes rise, there is a growing appetite for premium cars. This shift is accompanied by demand for advanced features, superior performance and more safety.”

Delving further on the middle class, Shrivastava noted, “The middle class is not only expanding, but also becoming more aspirational, seeking vehicles that reflect their improved socio economic status. The lesson here is since the market has become larger, consumers can be bucketed differently. There is increased need for requirements of the consumers to be addressed, and consumers have different requirements, that’s why personalisation is so important. This premiumisation is what we call in the market, people have more financing options, they are going for SUVs, and this, I believe, is going to continue in the near future.”

The third thing which is specific about Indian consumers is that there is a lot of digital influence now, whether it’s the tech savvy features in the car, they are part of the current digital revolution, which has fundamentally transformed the car buying process. “In car buying there are 26 touch points, starting from the time you think of buying a car to the actual delivery of the car,” he said, adding, “We at Maruti Suzuki have digitised 24 of them, the two points which have not been digitised are the test drive and the actual delivery which is difficult to digitise. However with the emerging technologies that we have, we can have virtual test drives as well, and that is one of the options that we have for the consumers as well.”

“Today’s consumers are well informed and conduct extensive online research. In India, 95% of the consumers conduct online research even before reaching the showrooms for a purchase. Social media research, review sites, automotive blogs are playing an increasingly important role, so digital is very important. The fourth thing is the need for sustainability, it is the other driving force in India’s automotive industry today, consumers are increasingly aware of environmental issues, this consciousness is reflected in their car buying choices as well, the demand for eco-friendly vehicles is on the rise and they are driven by reduction in carbon footprint and dependence on fossil fuels. And government is also incentivising green vehicles, and this is further reinforcing this trend,” Shrivastava noted.

Finally, people are preferring experience over ownership, and this is partly because of the digital revolution. He added, “We now have flexible, cost effective alternatives to traditional car ownership, there is no long term commitment for buying a car. Normally people used to buy a car and keep it for five-six years, now there is a shift towards value and experiences over ownership and, therefore, the concept of shared mobility of subscription buying, car rentals and so on. These are the five major points which I believe defines the automotive consumer in India.”

Increasingly driven by a digital first approach, automotive brands are embracing the digital era with enthusiasm, but recognising the immense potential that it holds. “We are not talking about websites or apps, but crafting user-friendly interactive platforms that serve as virtual showrooms. In fact, Maruti Suzuki has launched the Arena Verse in the Nexaverse, virtual showrooms that allow users to indulge in immersive experiences,” he added.