The improving networks and rapid surge in uptake of data hungry smartphones are driving demand for online content, which is now being satiated through applications by various content providers. Also, gradually, the price sensitive Indian market is observing an increased consideration from users to pay for content, which is also opening up business opportunities for various stakeholders.
The advertising scenario in India is rapidly changing and each and every brand has either opted for the digital media or is considering to go for it. Now enterprises and brands are opting for mobile advertising to promote their products and services and to reach out to customers in a cheaper and more targeted way.
According to a report by Mobile Marketing Association (MMA), the Indian mobile advertising market would cross Rs 2,800 crore, while revenues from paid mobile applications would touch Rs 2,000 crore by the year 2016. (See: Mobile Advertising: Ignore At Your Own Risk)
“Even in the slowdown, mobile advertising is emerging as the major tool for brands to advertise in a cost effective way,” says Preetesh Chouhan, Vice President for APAC region at Vdopia. According to him, the mobile advertising segment is seeing 20-30 percent growth and 2014 would be a major year for mobile advertising in the country.
“There are multi modes of advertising within the mobile domain, including in-app, rich media, video and banner. “Everyone can use such modes to advertise their services and products with a local approach,” said Chouhan.
Gaming applications, along with utility applications such news, weather, travel and messaging are offering enough space for advertisers to promote their services and products. For instance, Nimbuzz, which is a major OTT provider, offers space for brands to advertise on its platform and earns a significant amount of revenues from mobile advertising.
Video: Main Tool For Mobile Advertising
While all these modes are growing significantly, mobile advertising through videos has emerged as a major tool for brands. The main reason behind this trend is that TV advertising is becoming a pricey affair for brands and slots are limited there. Additionally, the change in consumer preferences, such as opting for smartphones and tablets to consume content instead of linear broadcasting is also another reason behind brands switching toward the digital mode.
Chouhan suggests that mobile advertising offers targeted reach to consumers and offers a variety of advertisement formats. “Now, TV content is being reproduced for mobiles as well, given the demand in the market. Although good content is still not there, which if available will further enhance the growth,” he says.
Shabir Momin, CTO and Co-Founder of Zenga TV also says that return on investment (ROI) is high for advertisers in mobile advertising. “The biggest advantage with mobile advertising is that brands can do a state, city and content wise segmentation. And, the cost of ad delivery to the same user on mobile is much cheaper. Also, it is extremely targeted and tailored,” Momin adds.
A shift to an alternative medium for advertising is bound to happen. It’s already happening in the western world and is picking up in India as well. According to Momin, the growth driver for mobile advertising through video is that TV spots are less and costly. (See: Mobile TV Gets A Fillip From Telcos)
“User engagement behavior is changing. Now, wherever users will go, brands will move accordingly,” he explains. Momin also claims that Zenga earns revenues from mobile advertising.
Role Of Telcos
In the mobile advertising space, Indian telecom service providers are also playing a pivotal role. Last year, Bharti Airtel and Sistema Shyam TeleServices launched their respective mobile advertising platforms to help leading brands connect with their customers in a personalized manner. (See MTS Launches Mobile Advertising Service and Airtel Forays Into Mobile Advertising.)
With the adoption of 3G and advent of 4G, operators can no longer ignore the potential of this new advertising media, and given that they have a good understanding of the behavior and patterns of their customers, it can make a big business case for them in the years to come.
“They are extremely important in the mobile advertising space, as they only can provide user base information that helps in segmenting and targeting the users as per their preferences,” Chouhan says.
"The fact is that in the next few years, cellular subscribers will outnumber the population that owns TV sets and other personal devices, and that makes sense for an advertiser to explore mobile as a medium," Anuj Kumar, Chief Executive Officer, Affle had said in an earlier interaction.
“Mobile advertising also has a unique differentiation over other platforms like TV—that it allows brands to do very deep segmentation by target audience and therefore feed them with most relevant and engaging content, something that a mass, linear platform like TV can’t achieve, and certainly not at a cost that mobile makes possible. However, TV advertising will continue to have its own set of relevance and impact,” says Deepak Kumar, Founder Analyst, BusinessandMarket.net.
According to Chouhan, 3G adoption is significantly helping the segment and with more users opting for data services, seamless advertising is now possible.
Nowadays, telcos are creating content on their own. For instance, Bharti Airtel is promoting Rs 1 video service and creating videos for the services, giving space for brands to advertise.
“A complete ecosystem is being created, which will certainly help the mobile advertisement space to flourish in the country,” Chouhan concludes.