Sunday, May 11, 2008

Oppurtunities, Now a Mouse Click Away.

Oppurtunities, Now a Mouse Click Away.

Only 1 per cent of the Rs. 1,800 crore online advertising industry in India has been tapped so far. What is the future of this booming industry?

The Rs 1,800 crore online advertising industry throws a huge entrepreneurial opportunity to the creatively enterprising types. You could either create your own online advertising agency, where everything happens online, be it client servicing, ad campaigning, captioning and yes, money making. The start up cost is lesser than that of any traditional advertising agency, and about your target audience, well it’s the whole world!


Are there enough opportunities available considering the fact that competition in this booming market is also fierce? But the landscape is changing, as the target audience is transforming its behaviour. Here’s a simple statistic: How much time of the day do you spend on the Internet, and how much of it is occupied in front of the television or reading the newspaper? Probably 8:4? Well, that’s where the space is – the surplus four hours that the viewer spends in front of the computer is on the Internet. Industry statistics say around 70 per cent TV ads are avoided by the viewers, which gives more scope for online ads.

Interactivity too is high while talking about online ads. Traditional ads are more indirect and assumption-based. In case of online communication and marketing, it’s two-way comm unication. Says M Sandeep, Group Head, Account Management of online ad agency Webchutney, “You can exactly track as to how many people clicked on a particular ad, how many people found it interesting and how many of them went a step further. You can also get answers to questions like what is the average age group of Internet users who clicked on a particular online ad, what is it that appealed or didnot appeal to them (by collecting data from the feedback forms they fill in) in a particular ad etc.” The industry numbers gathered through research on online ad industry speak for this optimism.

Although as of today, the online advertisement segment constitutes only 1 per cent of the total $2.2 billion Indian advertisement industry, it shows a promising future. The segment is likely to cross the $100 million mark by 2010!


Well, here you get a global audience for your ads, while still spending lesser money than what an international TV ad. India based Ybrant Technologies, a creative service provider to e-marketing, gets 99 per cent of its business from the US. One of the major clients for online ad agencies like Interactive Avenues, constitutes of NRIs and other global citizens. “We are already
working with close to 30 international clients. We are also talking to certain clients in the US and UK who would want to outsource their back-end operations to India especially for search advertising,” informs Ashish Sethia, VP Interactive Avenues Marketing Solutions Pvt Ltd.

Your primary viewer base is that part of the population, which is every marketer’s target – the youth. Pegged currently at 40-45 million, the Internet population is expected to grow to close to 100 million in the next 1- 2 years. A large part of these netizens are within 20-40 age group.
Again you have plethora of options to choose from like building websites, display ads which would further include banners, media planning and buying, designing, mobile marketing, email marketing, search engine optimisation and search marketing. You name it and you have it.


Well, if you want to start an online ad venture, you need to understand that a market that is relatively new has slightly different nuances. As Sandeep says, “Online ads are more direct and crisp (contentwise and conceptwise). For instance, a Google ad word count has a maximum of 25-30 characters. The design too isn’t very flashy. The logic behind the execution of an online ad is simple. What might look dull as a TV ad might just work well in the format of an online ad.” Hence, the first step towards instituting an online ad venture is acquiring the required skills:
Thorough knowledge of the Internet is a must. Niche skills like creativity, inclination towards search marketing, technological know how, understanding of consumer behaviour etc. are also needed.

Planning is extremely important. Questions like ‘what is it that I want to achieve out of a particular campaign’, ‘how can I cater to a cross section of my target group’ and ‘how can I tactfully calculate the ROI’ will arise. The number of questions while conceptualising an online advertisement are multifold.

To start the agency on a small scale, the cost would be around Rs 10 lakh, which would cover the cost of computers, Internet connection, and payrolls. In terms of scope of operations, a minimum of certain skills are required – copywriting, designing, accounting, business developing and technical administration.


And now the challenges… For one, the attitude and the approach one has towards the industry hasn’t changed. The unfamiliarity with the new medium, lack of understanding of its reach, fear of venturing into a new area that hasn’t been tappped before are a few reasons that sometimes make it difficult for marketing executives to get clients. As Dr. Subho Ray, President, Internet and Mobile Association of India (IAMAI) opines, “The market at large is still not ready to see the value proposition of online advertisements.”

Constantly keeping pace with the rapidly changing landscape of online advertising is another daunting task. So, one needs to be prepared.

But the above mentioned challenges can be overcome if we understand some of the basic nuances of online advertising and explore various opportunities that this vast industry has to offer.

Article Resource:
Author: Jhinuk Chowdhury is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

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