Digital advertising is expected to grow by 50% in 2011. More brands are looking at the advertising opportunity driven by low-priced smartphones, expanding internet access and the growing power of search and social media networks in India. Anita Sharan reports.india Updated: Dec 26, 2010 22:13 IST
Miles Young, CEO, Ogilvy & Mather Worldwide, can’t stop emphasising the importance of digital media advertising to his agency and to others in the advertising and marketing world. “Two important things have happened side by side: the disaggregation of media and the digitisation of media. Although markets like India, Japan and Australia are still hugely dependent on television advertising, the two shifts together are going to make digital advertising of strategic importance even in these markets, something the US is already experiencing,” he said.
In agreement is R Gowthaman, leader, Mindshare, GroupM. “Digital advertising is growing rapidly in India and we expect 2011 to record at least a 50% rise over 2010. So the current Rs 1,000 crore worth of advertising on the digital media will grow to at least Rs 1,500-1,600 crore next year. The four pillars of growth for digital advertising are display advertising, social media, search and mobile,” he said. “The availability of smartphones at low price points will increase this platform’s digital advertising advantages very quickly.”
Kiran Gopinath, CEO and founder, Ozone Media, said: “Mobile and digital are getting due attention from advertisers, with digital brand campaigns gaining interest from traditional advertisers. We expect to this category to outpace the already high growth rate of internet advertising.”
Gowthaman highlighted what MindShare is seeing in the marketplace: “Indian advertisers are expecting consumers to access the upcoming World Cup and IPL next year online via their mobile phones. This is making them bullish about digital advertising and they are willing to experiment much more with it next year.”
According to a recent FICCI report, digital advertising will continue to generate huge interest and, given its small base, is expected to grow the fastest at a compounded annual growth rate of 29.6% over the next five years. Zenith Optimedia’s media study finds that digital advertising will be driven by social media and that most of the growth story will come from digital properties, especially those in the mobile domain.
Talking of digital properties, Gowthaman said mobile apps, gaming and IVRS (interactive voice response system) advertising on mobile will drive growth. “For now though, search leads the digital advertising space and will continue to remain big, though it will lose some ad allocation to display, mobile and social media advertising,” he said.
iProspect, Aegis Media’s search marketing agency, in a recent research study on Indian’s search behaviour among consumers, found:
* 82% of Indian consumers use search more than thrice a day — higher than Asia-Pacific’s 77.4% average
* 92% use search at least once a day
* In the last year, search has become more important to 93.6% of consumers
* Indian consumers’ use of mobile search is prolific — only 10% have not used mobile search, with 67% saying it has become more important to them in the last year.
* 89.4% of consumers in India prefer Google as their search engine, followed by Yahoo! (7.5%) and Bing (2.4%).
Then there’s social media, a highly visited space, especially by India’s youth. A recent study by ViziSense said social media usage has reached 60% of India’s online population. Studies indicate that seven out of the top 20 sites Indian internet users are visiting are in the social media space and four of the of top 20 most visited sites in India are social networking sites. Facebook claims 5.7 million users.
Gowthaman is also excited about display ads: “We find that display ads, including plain banner ads and rich media ads, are growing with advertisers. We reckon they will continue to grow.”
As more Indians make purchases online, the logical upshot will be more online advertising. The iProspect study found that a large number of Indian consumers buy directly online from sites they have searched across many categories: computers and electronics (78.4%), education (71.8%) and entertainment (65.5%). Search is used to gather information (60%) and compare prices and features (80%). Consumers are up to three times more likely to purchase directly from a site they found through search than one they found through another means, the study found.
Young sees the growth of the digital promise as a “huge opportunity to climb the value ladder. Only, there will have to be a shift in the ad industry’s silo mindset, its analog mentality. The primary purpose of our existence is to sell and we are in the business of creating content ecosystems which fit in with the new communication challenges, where the boundaries between different communication disciplines are blurring.”
The new content ecosystems would have to function within the bigger changing environment. “First, it’s back to corporations, not brands. It’s about authentic traits of the organisation, about what product brands draw from their stables. For example, it’s about what IBM stands for — its beliefs, its values. Second, it’s about transparency. The internet and social media have created a pervasive transparency where companies will have to put their flags down and say what they believe in,” he said.
The web has changed the way consumers seek information, he added, looking for advice rather than hard sell. Hard-hitting advertising will have to be replaced with content created to guide consumers through a maze of choices.
Everyone’s looking more closely at the digital opportunity. Going forward, it may not necessarily be as important to count the budget allocation percentages as much as being able to leverage the opportunities the more cost-effect digital platform accords to brands.
Among a host of marketers, Unilever and PepsiCo, which recently promoted their brands via social networking, will swear by digital marketing effectiveness.