Rohit Bhasin of Kotak Mahindra Bank on bringing consumer-centricity from FMCG to BFSI

Picture this: You are a bank competing with some of the largest public-sector banks in the country. You witness a trend: Even though the market interest rates are at an all-time high, a massive one-third part of the total deposits in banks is in low-yielding savings accounts rather than high-yielding fixed deposits. You wonder why is that the case. The answer seems to be the attitude Indians have when it comes to saving money. India has always been a land of savers due to the uncertainty of emergencies. 

Now that you know the situation, what do you do about it? Your CMO–who has an experience working in FMCG–along with the marketing team comes up with an idea for an account which could provide the liquidity of a savings account while also offering the interest of a fixed deposit. 

Such is the perspective one brings when coming from an industry that sells tangible household products into one that offers financial services. Understanding your consumers’ needs becomes indispensable when trying to tailor your products accordingly. 

Rohit Bhasin, President - Retail Liabilities & Chief Marketing Officer, Kotak Mahindra Bank joined the bank a year ago, switching from an illustrious career in the FMCG sector. Bhasin’s addition to the bank’s leadership team was driven by the intention of bringing consumer-centricity to the banking sector. 

Rohit Bhasin has had a diverse career journey, starting in sales and marketing at Unilever before moving to various roles across different regions and brands. His notable experiences include leading initiatives in sales and marketing, such as promoting handwashing with soap to reduce child mortality rates and rejuvenating the image of Ponds. 

His approach involves understanding consumer needs, creating tailored products, and utilising marketing strategies to meet those needs effectively. In this interview with Social Samosa, he discusses Kotak's marketing strategy, key campaigns, and adaptation to industry trends like digitalisation and premiumisation. Additionally, he highlights the role of AI in marketing and the essential skills for a CMO, emphasising a consumer-first approach and understanding digital channels.

Edited excerpts:

Can you walk us through your journey in the industry, from your beginnings to your current role as CMO at Kotak?

I started my journey in the corporate world back in 1998 after graduating from B-school. I joined Unilever as a management leader and took on various roles across sales and marketing. One memorable experience was as a young sales manager in East Uttar Pradesh, where I led a team older than me. Building rapport and driving thought leadership among them was a significant leadership challenge, but it forged lasting friendships. 

Transitioning to marketing, I began in brand management, focusing on the laundry sector. I led the brand Rin during a pivotal period when Tide and Ariel entered the Indian market. Crafting a winning portfolio against this competition was a highlight. 

Later, I moved to the UK to establish a Global Innovation Center for one of our brands, emphasising a global-local approach to product development. 

Subsequently, I headed the skin business for Unilever in Africa. Recognising the unique needs of African consumers, we tailored products accordingly, leading to a successful venture.

Returning to India in 2011, I worked with Lifebuoy on promoting handwashing with soap to reduce child mortality rates. This initiative was personally rewarding, knowing it could save lives. We did the campaign ‘Gondappa,’ which was one of the first campaigns from India to win at Cannes. 

Afterwards, I led the Glow and Lovely brand, then known as Fair and Lovely, empowering women through education initiatives. Witnessing the impact of scholarships on rural girls was particularly gratifying.

As the global head of Ponds, I faced the challenge of rejuvenating its image among younger consumers. By embracing digital strategies and creating relatable content, we successfully repositioned the brand, achieving strong growth.

I had been doing that for 25 years and wanted to do something different. Incidentally, there was a calling from Kotak wherein they wanted someone from the FMCG background to bring consumer-centricity to the banking sector. Drawing from my FMCG background, I aim to shift the bank towards a more demand-driven approach, focusing on consumer needs and tailored products.

What prompted your transition from the FMCG sector to BFSI, and how has your experience in FMCG influenced your approach to marketing in the banking sector?

The opportunity was wonderful, it was the vision of Uday Kotak, KVS Manian, and Shanti Ekambaram. When we had this conversation a year and a half back about how to build consumer-centricity in the bank, we were moving from more of a supply-side thinking to a demand-side perspective. That was really the trigger for me. I've always been interested in the world of finance and have experience in consumer understanding and marketing. So, am I getting an opportunity to combine the two and apply what I've learned over the last 25 years on household brands to the banking industry? Can we build differentiation and create products and propositions that genuinely meet consumers' needs? That could be very relevant in the industry.

The journey has been very interesting; challenging, yet very interesting. It's a cultural and mindset change; Rome was not built in a day. Therefore, we will take time to change culture and mindset. But we've already started on that journey. If you see the last few campaigns we've run since I started, we took a different approach. Instead of starting with our product's features, we began by understanding the consumer's needs. We realised that even though market interest rates were at an all-time high, a significant portion of deposits i.e. INR 65 lakh crores, around one-third of the total, were in low-yielding savings accounts rather than high-yielding fixed deposits. We wondered why people weren't moving their money.

When we did more consumer research, we found that India has always been a land of savers due to the uncertainty of emergencies. People were hesitant to lock their money into fixed products. We asked ourselves, ‘What if we could provide the liquidity of a savings account while also offering the interest of a fixed deposit?’ So, we created ‘ActivMoney’ as a product that provides higher returns than a fixed deposit while maintaining the liquidity of a savings account. We built a campaign around that, and consumers responded positively by purchasing it in large quantities. We substantially increased our active money in one year, something we hadn't achieved in 20 years, by genuinely addressing consumer needs and raising awareness through the right messaging and channels.

Another lesson I learned is that banking is very push-based. So, my current endeavour is to create products based on consumer needs rather than banking activities. If we can do that, consumers will want to buy those products, and they will be successful. The journey involves understanding consumer needs, creating differentiated products and propositions, testing them until they're truly unique, investing in marketing to raise awareness, and using distribution channels to fulfil the demand created by marketing.

What does Kotak's overall marketing strategy look like? What is the larger objective behind each marketing activity? What is the tonality that the brand has taken in its communication and the reason behind it?

As a financial conglomerate and a bank, we address five fundamental consumer needs. Firstly, we cater to savings requirements. Secondly, we provide solutions for obtaining loans. Thirdly, we facilitate various forms of payments including UPI, credit cards, and debit cards. Fourthly, we offer investment opportunities for those looking to grow their funds. Lastly, we provide insurance for protection against life's uncertainties such as accidents.

Now, let's shift our perspective to that of the consumer. Consider this scenario: A young professional has just entered the workforce. Initially, they may not have a strong inclination towards saving, as they are focused on immediate spending. For instance, an early jobber might receive a monthly stipend during college, which they promptly share with family upon starting work. As their income grows, they face the dilemma of wanting to both spend and save. With a monthly salary of INR 50,000, but a desire to purchase a INR 70,000 iPhone, they seek ways to manage their finances responsibly. This might involve seeking discounts or cashback offers to bridge the gap between income and expenditure.

To avoid falling into debt, that person may also require access to credit, such as through a credit card or payday loan, to smooth out fluctuations in their cash flow. Eventually, they would aspire to invest in stocks and mutual funds, aiming for long-term financial growth. However, they would need guidance and support to navigate this new territory, preferring an easy and accessible investment platform.

Our task is to tailor our offerings to meet these evolving consumer needs. By bundling products and services such as investment options, payment solutions, credit facilities, and savings accounts, we can create a compelling proposition for individuals. Our marketing efforts will play a crucial role in communicating these tailored solutions and driving demand among our target audience.

In essence, our strategy revolves around identifying key consumer segments and crafting bundled propositions that address their specific needs. Through targeted marketing campaigns, we aim to position ourselves as the go-to financial partner for individuals at every stage of their financial journey.

Could you highlight some of Kotak’s key campaigns that have resonated with consumers and contributed to the brand's success?

There are a few that come to mind. Kotak is relatively young with a 20-year history as a brand. We began with an iconic campaign focused on investments, leveraging our background vis-a-vis Kotak Securities. Our initial campaign emphasised investment thinking, and as we transitioned into banking, we recognized the primary consumer need: depositing and withdrawing funds. Our next significant campaign addressed the deregulation of interest rates, where we distinguished ourselves by being the first bank to raise rates to 6%. This was accompanied by a series of communications emphasising the benefits of a 6% rate over 4%. We developed the character of ‘Subbu,’ representing a streetsmart neighbour who is a knowledgeable advisor on financial matters, which became central to our branding for the next decade. 

Following a major merger, doubling our distribution network, we launched the 'Kona Kona Kotak' campaign to assert our expanded presence across the country. During the demonetisation period, we innovated by enabling customers to open accounts in just three minutes via online processes and video KYC, in alignment with government initiatives. Our 'India Invited' campaign reinforced our inclusive stance, emphasising that all Indians were welcome, regardless of background. 

Subsequently, we introduced the ActivMoney campaign as well as the senior citizens campaign. Currently, we're developing a new brand positioning campaign, slated for release in the coming months.

Kotak 811 has been a game-changer in the digital banking space. How has the bank leveraged social media to drive awareness and adoption of this product? 

Kotak811 is a digital-only product. You can't open an 811 account by going to the bank. From building awareness at the top of the funnel about the line, as well as digital, we leverage our performance marketing and social marketing to offer an economic proposition. We provide consumers with a link to open the account digitally. We engage extensively in performance marketing; we open close to six lakh accounts a month. We understand the importance of performance marketing in driving the user journey to open the account. Additionally, we are active on social media and digital channels to raise awareness of our propositions, including account opening and other products like credit cards, to drive digital acquisition.

When it comes to consumer segmentation, what factors does Kotak consider, and how do you decide on the most effective media channels to reach each segment?

Imagine you're my target audience, and I need to map-out how you spend your day. Let's break it down. In the morning, perhaps you start by reading a physical newspaper. That's a challenge for me as more people are shifting to digital. Then you move on to social media, checking out Instagram, following influencers, scrolling through reels. Advertisements on social media become significant here. Later in the day, you might watch TV, say, streaming IPL on a connected device. Maybe on weekends, you go to the cinema. Once I know who my target audience is and their daily routine, I can choose the right channels to engage them. It's about crafting messages tailored to each channel. Remember, scaling from one consumer to millions isn't straightforward. It's a science. We need to carefully plan our approach, ensuring we reach the right people with the right frequency. Understanding media habits helps us drive message delivery and action.

What are some recent trends you've observed in the BFSI sector, particularly in terms of consumer behaviour and preferences, and how is Kotak adapting to these changes?

One trend that I have noticed is that consumers are moving a lot more towards digital. It’s not just happening in BFSI, it’s a trend that is evident in all sectors be it FMCG, entertainment, shopping, food delivery, etc. In BFSI, consumers are gravitating towards digital. They don’t want to visit the bank to take out a loan, get a credit card, etc. And we are tackling that by simplifying consumer journeys. The banking app has thus become our biggest branch. The other trend I am seeing is the disruption of banks by fintechs or other unique-product categories like the platforms Groww and Zerodha. Insurance has been disrupted by the emergence of the likes of ACKO and PhonePe. More lending is being done by fintechs than banks today. Essentially, we’re seeing people coming up with single-product use cases and building a simplified end-to-end acquisition-to-servicing digital experience on those. And that is where we have been left behind a bit and have some catching up to do so that we can provide all journeys end-to-end digitally to consumers. Banks have the advantage of having all the services in one place but they have not been able to leverage that because they haven’t been fast enough to move from the physical to digital space. 

There has been an ongoing trend of premiumisation in FMCG. Do you think that the BFSI industry can move into that direction? 

A lot of categories are getting premiumised, the same applies to BFSI. The idea of moving up the ladder on premium banking, usage of more premium cards, and upgrading from a zero-balance public-sector bank to a bank that asks you to keep a balance but provides services against that balance are trends we are witnessing. People are willing to pay more premium in order to get better services and experiences. There is a faster growth in wealth management premium banking than at the mass level.         

What can BFSI learn from FMCG in terms of marketing?   

One is moving from a supply-side thinking to a demand-side thinking. Don’t start from creating a product and finding the right consumer for it but rather identify the needs that the consumer has and build your product accordingly. Second is always search for differentiation, don’t build a me-too product. The next thing is to use marketing dollars to build awareness about that differentiated product. A key element is building trust as this category has a deficit of trust.  

How has AI impacted marketing? How is Kotak adopting it in its marketing strategies? 

The first best use case of AI is being able to provide better algorithms to build better credit rules and principles. AI can be used to build data algorithms to define the optimal level of credit that you can give to someone. If you can build that optimum level, you can maximise the amount of credit you can give without increasing the risk of delinquency. The other use of AI can be to analyse the past spending habits of a consumer and you could define the right propensity of the consumer for the future. Thus, you can provide the right product to that consumer rather than having a one-product-fits-all approach. Once you have that, one key use of AI could be to design the apt communication strategy for that consumer. Thus it can be used to better understand the psyche of the consumer and tailor customised messaging.  

How is the role of a CMO changing on an industry level? What do think you are the must-have skills for a CMO? What skills do you believe are timeless? 

I think the role of a CMO remains the same. It is essentially to use marketing to drive business growth. If you cannot build effective campaigns that do not translate into growth, it is not of any use. Any creativity that does not translate into growth becomes inessential. The CMO is the voice of the consumer in the organisation. Their job is to help the product team to build better products as per the consumer needs. And then build campaigns to drive awareness about those products in the language and personality of the brand. That role does not change. 

What is changing is the understating of the news channels. Digital is emerging as a new channel. A CMO who does not understand digital, is living in a lost era. It really boils down to how you use digital as a channel to drive awareness and to drive acquisition. Understanding the science of performance marketing is key as it proves to be a cost-effective way of converting people to buy your product. At the same time, it is important to to not lose sight of the top of the funnel awareness–if you do not do that, you will not have a big enough pool to convert from. 

As both the President of Retail Liabilities - Product and Chief Marketing Officer, what key skills do you believe are essential for success in your dual role? How do you balance the strategic aspects of product development with the creative demands of marketing?

I am a marketer who thinks consumer-first. If you keep the consumer at the heart of it, you can do a marketing or a product role quite easily. Always start with the consumer, always be a consumer evangelist, make sure you understand the needs of the consumer and then work with the product team to build the most simplified and delightful product.  

How has the agency client relationship changed from the time you started? What is a good client brief according to you?  

A lot of times what happens is that agencies think their job is to do creativity but what they need to understand is that their job is to help me drive business growth. Every penny I spend on creating campaigns, I could have used it somewhere else. So, if I’m spending that money on campaigns, it should translate into tangible growth. Successful agencies are those who keep business growth as the output of their creativity and unsuccessful ones those who focus solely on creativity without linking it to business growth.  In essence, the agency-client relationship has not changed, it remains the same. 

Could you share Kotak's long-term and short-term goals in terms of marketing? How do you plan to achieve these goals amidst the evolving landscape of the banking industry?

The long term goal is to be the most loved financial brand in the industry and we’ll do that by understating the consumer’s needs and building relevant products and campaigns. Building optimal user experience across all touchpoints remains the key goal. We want to fulfil the aspirations of the consumers.