Within digital, Meta provides the highest ROI to brands: Arun Srinivas

Meta commissioned studies with leading firms Nielsen and Kantar show that return on investment from digital trumps other mediums for the FMCG sector. Among the key findings, the studies call out digital platforms, especially Meta, a crucial pillar in driving brand imagery, equity, and higher return on investment across categories.

In conversation with Adgully, Arun Srinivas, Director & Head of Ads Business for Meta in India, shares insights on the latest Nielsen X Meta Media ROI 2024 report and the impact of digital advertising on FMCG brands.

According to you, what are the most standout findings from the Nielsen X Meta Media ROI 2024 report?

I would say that the biggest fact from an independent agency like Nielsen, or even Kantar, who has also done significant work on imagery, is that we are clearly driving very high ROI for the same dollar compared to other mediums. Firstly, digital clearly gives a higher ROI than conventional mediums. Within digital, I believe Meta provides the highest ROI. These are, in my opinion, the two standout findings for us.

As per the report, Meta accounts for 31% of media spends by brands. Could you tell us about the increased digital investments and the ROI expected in 2024?

I don’t think we’ll be able to specify that very precisely. It’s like estimating who will do what, etc. Based on the report, if we put $1 on TV or other print or conventional mediums, and equally $1 on Meta, we’re getting higher ROI from Meta. I’d expect people who see this and evaluate it internally to move their money to higher ROI generating platforms.

What are the key findings on the growth of digital ROI from FMCG brands?

In FMCG, it is pretty stark and high for two reasons. For example, digital-first brands have always used digital, continuing to test, learn, and improve. D2C brands in the FMCG space typically start on platforms like Facebook and Instagram, scaling by testing, learning, and investing more, eventually achieving significant scale. Historically, the dominant medium for FMCG brands has been television. Mediums like digital, specifically Facebook and Instagram, adapted assets initially made for TV. Now, we’re at an inflection point, where digital spends have surpassed television from an ad industry perspective, and the reach of digital is growing. Millions across urban and rural areas access these platforms daily, making higher ROI not surprising. These traditionally digital-reluctant brands are now realizing the necessity to shift their spends to digital.

What are your observations on the growing adoption of digital platforms for advertising by FMCG marketing? What does the road ahead look like?

The first movers here were digital-first companies like Amazon, Hotstar, Ola, Uber, and fintech banks. In the CPG space, brands like Mama Earth and Wow Shampoo have been digital-first. Historically, many brands used TV as their mainstay, but we are now seeing a shift. Brands like Maggie from Nestle, Lakme from Unilever, and Maybelline from L’Oreal are increasing their investments in creating digital-first and Reels-first marketing campaigns. This is the next step for these brands.

How is Meta helping FMCG brands attain higher ROI through investment on its platforms?

The ROI is an outcome of our reach and our ability to deliver on their objectives, whether it is just salience (brand recall) or achieving higher attributes on imagery, like meaningfulness or differentiation. Studies show that Meta delivers high ROI by exceeding its share of investment in output attributes like salience and imagery. The Kantar study highlighted Meta’s superior performance in imagery attributes as well. This is how Meta helps brands achieve better ROI.

Given the strong adoption of Artificial Intelligence, how is AI shaping Meta’s business and operations of the future?

AI has always been our backbone. On platforms like Instagram, you get personalized content based on your interests, not just who you follow. AI now curates 20-40% of content from people you may like, enhancing user engagement and time spent on the platform. Increased engagement leads to better ad recall and message transmission, boosting ROI. AI is driving discovery on our platform and enhancing features like chatbots.

Additionally, we’ve launched new AI capabilities for advertisers, such as:

Text generation: Input a few keywords to generate phrases, captions, or jingles.
Image generation: Create images based on descriptions, with editable elements.
Image enhancement: Generate various aspect ratios from a single shot, saving time and cost.

AI is already live with these features in India, reducing daily chores for advertisers and reimagining possibilities. Small businesses can generate images and captions without expensive photo shoots, leveraging the platform’s capabilities.

How is Meta’s suite of AI products positively impacting ad performance and engagement rates of advertisers?

We have a product called the Advantage+ suite, which is AI-led, comprising four components:

App Install Product: For companies like Dream11, Hotstar, and Amazon, where the goal is to get users to install their apps.
Creative Tools: For generating and enhancing ad creatives.
Shopping Campaigns: Dynamically showcases different products based on user preferences and past interactions. For example, if a user follows certain sports stars, they might see creatives featuring those stars, increasing the likelihood of installs or purchases.
Dynamic Ad Placements: Adjusts ads in real-time to match user preferences, enhancing engagement and performance.

These AI-driven tools improve the efficacy of ad campaigns by tailoring content to user interests and behaviors, driving higher engagement and better performance.