Only 14 Out Of 50 Top Internet Advertisers Present In India. Is That The Cause For Worry?

How big does a market grow before the best in the industry set sail? As a matter of fact, the best in the industry set sail not based on how big a market has grown, but how big a market can grow. In that regard, India is among the front runners and little wonder that so many MNCs have set their eyes on the Indian market.

But apparently, the top Internet advertisers are yet to follow suit. In a recent study conducted by TNS Media Intelligence, only 14 of the 50 biggest internet advertisers in the world have their operations in India; either directly or through partnerships. Big names that are still not present here include Scottrade, TD Ameritrade Brokerage, Sprint, E-Trade, Nascar and Netflix.

What could be the reason behind this? The abysmal internet infrastructure has been raked in time and again, but in this case, that is surely not the reason. That is because while India could have a meager 6-7 percent internet penetration, in terms of volumes, it is still among the highest in the world, and is definitely a lucrative bet for these companies to take.

When it comes to internet consumption, the numbers are attractive. 10-25 percent of all media readership in India is now online. Average 21-35 year olds spend over 50 hours a month on the internet and when everything else fell, internet advertising grew by 16% in the first six months of 2009.

So, where lies the problem? In my opinion, we are probably looking at the wrong metrics in the first place. While the TNS study definitely looks alarming – just 14 of 50 top internet advertisers are in India, the internet penetration and growth is the last thing we should be studying to understand why. The top 50 internet advertisers are all from varied industries – finance, entertainment, telecom,etc. And these are not necessarily the biggest names in the corresponding industries. Some of them are not even a ‘multinational’ in the actual sense.

So, while they may be the biggest in terms of advertising on the internet, expanding to India or for that matter to any other part of the world might not be in the radar for many of them. Also, a company that spends heavily on one medium (say the internet) does not base its expansion strategy based on the internet penetration that exists elsewhere, but the overall market potential. If Sprint were to launch in India and they feel the internet has not grown enough, they are surely going to look at the other marketing channels available, but are not going to call off their expansions because of the same.

So, to put it shortly, the study does not necessarily portray the internet infrastructure in India in negative light. Do you then agree that the absence of 38 of the top 50 internet advertisers is still no cause for worry? Let us know in the comments.