ZenithOptimedia (A media agency) have came up with an advertising expenditure forecast…
Well I’m not the greatest in number crunching – but let me try to make some sense out of some of the figures it contains pertaining to Online Advertising in India….
Internet Advertising Market in India in 2006 = Rs 210 crores
Internet Advertising Market in India by the end of 2007 (is likely to be) = Rs 450 crores
That’s nearly a 115% rise.
Internet Advertising Market in India by the end of 2009 (is estimated to be) = Rs 2250 crores
Approximately a 970% rise from 2006 and a 400% rise from the likely figure at the end of 2007.
So what exactly is going to responsible for this huge growth?
Web 2.0? Web 3.0? Local Search? Higher internet penetration? Mobile Advertising?
User Generated Content?
Can user generated content seriously drive this rise?
Why do you think Rediff launched iShare?
Users will upload content and then other users would view the content online. The more they view and share – the more the engagement, the more the page views, the more the time they spend on the site. Therefore, the more the number of advertisements Rediff can serve to the end user.
Well internet penetration is just at 3%. Mobile penetration is a lot more. Internet penetration via Mobile device is on the rise. Mobile Advertising is a huge market (O.T: The Mobile Monday episode of July is dedicated to Mobile Advertising and will be on July 16th. Hope to see some of you there)
So mobile can fuel this growth. GPRS penetration will also result in more usage of ‘Local Search’.
The newer junta who are getting online will continue to consume online classifieds. So that’s not a market which is going to die any time soon. Advertising expenditure by Job, Matrimonial, Real Estate portals will only increase – but it would be nice to see how much increase is seen in their expenditure in the Online Medium and SEM rather than other traditional forms of advertising.
What do you think is going to fuel this 970% increase?
Now let’s shift continents and look at the current scene in the Pan-European market.
The annual value of pan-European online advertising is set to reach 16bn euros ($22bn; £10.8bn) by 2012, more than double that of 2006 reports BBC.
According to ZenithOptimedia – We would be at $ 0.5 billion in 2009.
The report by research body Forrester said online adverts would leap to 18% of market share, up from 9% currently.
In India Online advertising constitutes around 1% of the total advertising pie.
Some other stuff from the report:
- 52% of people were now regularly online, spending more time doing so than watching television.
- European internet users now spend 14.3 hours a week online, compared with 11.3 hours watching TV, and 4.4 hours reading newspapers or magazines.
- Search engines would continue to dominate online advertising spend, followed by display advertisements and e-mails.
P.S: Please feel to correct me – if you feel there’s something wrong about any of these figures.
Related Posts:
The comScore India Internet Usage report
The Online World – Is it the place to be?
Is the future of advertising – ONLINE?
How are you going to get a local dosa joint in a little neighbourhood to advertise online?
SEMPO (India) kicks off – ‘Can Search Offer You A Promising Career?’
Cost-Per-Lead: Is it really worth it? (Online Matrimony industry)
I agree with you. But how many people click on the ads and check out?. Does banner/text ads will have good ROI for advertisers. As text ads are declining. Innovation like gettailgate.com will get boom but in gettailgate.com hijacking is more concerned. Your figures are absolutely correct.
Impressive article.
Thanks Mahesh. It's all about getting innovative with advertising means…
In Game advertising is sure to a big thing – with the online gaming scene set to explode too.
Can you imagine the prospects of viral advertising with a population as large as ours – cool video clips would spread virally in the mobile sphere too.
Yes, a very fine article, n good fugures.
I would rather say that this unexpected Windfall increase in Online Advertising Spending is mainly due to the size of the captive market, and lack of education in mind of the marketers. The companies are not even aware if they will benefit out of these ads.
only once they place an ad to test market, and fail will they not continue.
This market will see much big figures in coming years, but it will be difiicult to sustain a growth after 5 years from now when all companies would have tested and tried failures / success. Only the efficient ones would spend on online ads, by then, the cost of pubishing ad would be manifolds as compared to now.
So companies should get into some kind of long term arrangment if they are happy with the response of online ad NOW….
Very nice blog..
There is really huge opportunity in indian internet market. As expected in 2015, 40% india will use internet that time internet advertisement will go like anything.
Thanks