Net gains steam

Updated: Jan 5 2006, 05:30am hrs
India is at the cusp of a huge boom, enthuses Rajnish R, head of marketing and strategic business initiatives, Microsoft Corporation India. He is talking about the online advertising market in India, which is estimated to touch Rs 162 crore by the end of this financial year and grow to Rs 280 crore by 2007-08, according to the Internet and Mobile Association of India (IAMAI). India is going to be the biggest internet userbase in the world after China and the US, says Rajnish.

Though, at present, barely 1.2% of the total advertising revenues in India is contributed by internet advertising, marketers and websites are visibly excited as more and more of the target audience log on. But the potential market is not really big yet. C Venkatesh Sharma, country head, Tribal DDB and general manager, Digital Branding Solutions, reasons: Internet penetration is urban-centric, largely concentrated in the top 23 cities, almost 70% male, between 15 and 40 years. That apart, unlike TV or print, there is no standardisation and no agency such as TAM or MRUC to measure viewer/ readership. A number of people are not sure of the return on investment, says Sharma.

But the future looks bright, he insists. Clients have started to set aside budgets for it. Those who have tried it once are returning. In fact, online advertising is the only medium expected to increase its market share significantly over the next five years, claims Preeti Desai, president, IAMAI.

Desais enthusiasm is not misplaced. The average time spent on the internet is on a rise. From 58 minutes on weekdays in the Indian Readership Survey (which tracks media consumption) July-December 2003, it increased to 63 in IRS July-December 2005. During this period, TV consumption fell to 104 minutes from 108 minutes. The average time spent on radio and print, however, saw a marginal rise. It was 82 minutes in IRS July-December 2005, up from 80 minutes in July-December 2003. The time spent on press went up to 33 minutes in IRS July-December 2003, from 31 minutes in 2003.

Says Raj Nayak, chief executive, NDTV Media (which recently tied up with MSN India to represent it to clients and advertisers across the country), The new mass media suffers from a perception problem. It adds 10 lakh new users every month, but it has only 80 advertisers. TV has about 3,000 while print has 28,000. That is the potential of internet advertising. If we reach 500 clients in one year, well think its a phenomenal job.

In this direction, MSN also launched Desktop TV, which allows advertisers to run their television campaign on the MSN India home page without making any changes to the commercial. Weve spoken to a lot of advertisers such as Satnam Overseas and Liberty Shoes. Most of them dont understand the medium. You have to come out with something thats easily understood, communicate in their language, and demystify the internet. The biggest challenge is to educate, says Nayak.

The good news is things are changing fast. The financial categorybanking, share trading, etchas embraced online advertising with open arms. The role of websites and online marketing is significant in driving the Further Learn and Purchase Decision phases for financial services, auto, electronics home products, movies, travel and telecom. More commonly purchased goods, such as those in the personal/household care category continue to be more influenced by TV and print, admits IAMAIs Desai.

Even FMCG companies, that were slow on the uptake, are expected to increase spending on the net from 7% last year to 9% by the end of this financial year and estimated to touch 11% by 2007-08. Last year when Marico launched its hair serum Silk-n-Shine, it decided to break the ad campaign on Yahoo! India instead of television. Saugata Gupta, head marketing, Marico India, says, We use the internet more for brand building and imagery building. Online advertising helps to focus at the target group.

We are changing the way internet is sold, says NDTVs Nayak. Why should this need to be different from any other medium My job is to deliver a 3.8 crore audience. At the end of the day if somebody doesnt see the ad, doesnt click on it, its not my problem. Dont make that the reason for not buying the medium.

With new categories using the net with gusto, advertising rates on the net are heading northwards. However, says Kamal Basu, executive vice-president, Saatchi & Saatchi, for now, it will be mostly national playersthose that have the strength and muscle to experimentadvertising on the net.

Building a digital brand

Three broad components make up the digital brand: online marketing, offline marketing integration, and information architecture and online content.

Online marketing consists of banners, email, wireless, micro-sites, sponsorships, and the direct advertising side of distributing the brand to online media

Offline marketing refers to traditional outdoor, TV, and print, with a focus on strong integration of online with calls to action, such as URLs or other hooks to digital environments

Information architecture & online content represents your companys website, online customer service, collaborative filtering, personalisation, and any part of the website that creates an impression to the end user Integrating these three elements is key to building a sustainable and effective digital brand.