While consumers spend less than half of their digital media time (48%) on walled gardens, these platforms receive 5.5 times the advertising money spent on the open internet. The open internet, which consumes 52% of the viewer’s media time, receives only 15% of the overall advertising spend in the country, as per a report by media buying platform The Trade Desk.
For the uninitiated, a walled garden refers to a closed platform where the technology provider controls the applications, or content being shared. This includes platforms like Google, Meta and Amazon. The open internet encompasses all data sources that lie outside of walled gardens, from websites to CTV.
The open internet in India has 600 million users, which is around 10% more than walled gardens, as per estimates. And if your target group (TG) is spending more time on the open internet, why are advertisers dedicating copious amounts into walled gardens?
Experts say walled gardens present brands with a range of advantages that the open internet doesn’t offer. Explains Siddharth Dabhade, MD and commercial board member of ad-tech firm MiQ: “Walled gardens often have access to first-party data, which is typically more accurate and reliable compared to third-party data available on the open internet, enabling brands to make informed decisions and optimise campaigns. Further, some walled gardens offer exclusive access to premium inventory, including high-impact ad placements that may not be available on the open internet. They also provide standardised measurement and attribution tools to track campaign performance accurately.”
On the flip side, marketers who focus solely on walled gardens will only capture one dimension of consumer behaviour and miss out touchpoints on the open internet, where consumers are more open to advertising. Tejinder Gill, general manager at The Trade Desk, says, “With data-driven advertising gaining momentum in a cookieless world, marketers can leverage AI-powered platforms to efficiently target millions of users on the rapidly expanding open internet.” Indeed, says Gill, advertisers are gradually tapping into the opportunities provided by the open internet.
So the alternative? Do a balancing act.
Custom-made solution
The digital advertising ecosystem has grown exponentially over the last decade in India to command as much as 40% of India’s advertising expenditure of `99,038 crore in CY23 (Pitch Madison report, 2024).
The biggest challenge of advertising has been to gain and retain the consumer’s attention. Closed platforms such as Facebook and Amazon offer innovations in video, payments and e-commerce to enable immersive experiences that address most lifestyle needs of digital native consumers. Despite their obvious advantages, brands should be mindful of a few things when advertising on walled gardens. Lalatendu Das, CEO at Performics India, says most walled gardens provide biddable platforms, where the price for common keywords increases with the increase in demand. “As a result, in highly competitive spaces, often the return on ad spending is adversely affected. Moreover, while advertising on such platforms gives advertisers access to a ready audience, the platform eventually owns the consumer and not the brand. Hence all subsequent interaction with the consumer involves incremental spends by advertisers on the same walled garden,” notes Das.
The key to maximising returns on digital campaigns lies in strategically leveraging the strengths of both walled gardens and the open internet. For example, Das suggests that a brand can leverage walled gardens as a test bed to understand consumer behaviour while also investing part of the budget towards their own D2C channel on the open internet to provide premium services to high value consumers. “To maximise ROI, brands should adopt a two-pronged approach. The open internet provides opportunities for brand building and discovery through programmatic advertising and high-quality content partnerships. By publishing content on relevant websites, blogs, and social media platforms outside of walled gardens, advertisers can increase brand awareness and engagement organically. Walled gardens, on the other hand, offer targeted campaigns, enabling brands to reach specific user segments for brand awareness, lead generation and retargeting,” says Jacob Joseph, VP, data science at CleverTap.
The Trade Desk’s Gill says advertisers are gradually tapping into the opportunities provided by apps, websites, OTT and CTV. Indeed, experts reckon that CTV or connected TV can be the bridge between traditional television and the open internet offering reach, precision targeting and interactive engagement options. The advantage is that the CTV universe is growing. “Total TV screens will increase from 182 million in 2023 to 202 million by 2026, with the mix changing significantly in favour of connected TVs (CTV),” estimates EY-FICCI. As the popularity of CTV continues to rise, using its targeting capabilities, such as contextual data, will be de rigueur for advertisers looking to stay ahead of the curve.