The digital transformation in India goes steadily from traditional media to the digital era. Although advertisers are still favouring traditional media with print and TV making up the lion’s share, it is expected to see a decrease in total marketing investments to these sources.
Indian companies are now becoming more and more interested in how to create new positive consumer opportunities, raise consumer engagement and monetise it profitably through the digital space. This means businesses are shifting their marketing spend from traditional media to digital media. This trend will continue to grow and the advertising digital industry is projected to be the second fastest growing advertising market in Asia after China.
Here are just a few facts on industry development and foreign investment which result in a more favourable advertising and marketing environment in India:
- The Indian Railways is working on a new advertising policy aimed at installing 100,000 big digital screens at 2,175 railway stations across the country, which is expected to generate US$ 1.76 billion revenue annually. By the way, the Out of Home (OOH) advertising is expected to grow by 10% in 2018;
- Times Internet Limited plans to invest US$ 100 million in development of smart marketing technology platform Colombia, which will serve its marketers to engage with around 200 million digital users per month;
- ZipDial has become the first Indian technology product startup to be bought by Twitter in what is the third such deal led by a global corporation following the acquisitions by Facebook and Yahoo. The ZipDial deal is expected to cost Twitter US$ 34-35 million;
- GroupM, the US-based advertising media company, has acquired a majority stake in MediaCom India, a joint venture between GroupM India and Madison Media group's principal shareholder Sam Balsara.
According to Digital Marketing Industry Report 2018 released by Social Beat, India’s leading digital company, about 68% of brands use digital marketing to promote their services and products. What’s more, 33% of brands allocate over 40% of their marketing budget for digital marketing alone. It shows that brands want to reach out to the right audience at the right time at the right place and to establish a personal connect with them. Additionally, a strong digital presence fosters brand awareness and loyalty among consumers. Among the main marketing objectives brands are pushing for lead generation, customer engagement, brand awareness, reputation management, thought leadership, awareness of a new product, wherein 40% of brands consider lead generation is the primary objective behind digital marketing.
In the last five years digital market has grown significantly from 9.5% in 2013 to the predicted 19.5% in 2018. Speaking of the digital trends, as of today, there are four major forces that shape the modern digital landscape in India. They are Mobile, Video, Programmatic and Native Advertising. Though there has been a big leap in video consumption over the last year, Programmatic, Display and Native have also set a very high bar with Mobile becoming the priority choice to consume content.
India has the second-largest mobile internet market in the world (about 290 million users as for 2017). Mobile connectivity is now an essential part of the people’s lifestyle, due to the adoption of smartphones to enable easy access to 3G or 4G networks and the popularity of social networks. Today young people spend more than 2 hours per day on mobile devices. There is a very interesting fact concerning internet adoption in the indian market. While globally most people initially used a computer and only then they switched to mobile phones, the Indians seem to have missed this stage completely and started using mobile phones right away. The Indians use mobile phones to access the internet 80% of their time, leaving the desktop behind. It means that brands should focus mostly on mobile devices to reach those millions of potential consumers and to reap better results.
There is a rapid increase in video advertising in India as online video consumption continues to grow and more publishers have started to offer video inventory. So far, Facebook and YouTube occupy dominating positions in terms of video advertising along with OTTs such as Hotstar, SonyLiv and Voot making rapid strides in distributing the original content directly to the consumers over the Internet.
With the popularity of the social networks (Facebook, Twitter, Instagram etc.), there is a considerable increase in native advertising. Standard banner ads are losing their position, as users have become pre-programmed to ignore them. That is to say, people view native ads 53% more than banner ads. In 2018, native ads will amount to 60% of display ad spend and become the fastest growing part of the market.
As for programmatic advertising, both publishers and advertisers want to reach the right audience on the right device at the right time and price. This is feasible thanks to automated platforms and data analytics reports. Though Programmatic ad buying is a relatively recent phenomenon in India, we can see a progressive shift from traditional to programmatic media buying during the past years. According to Matt Brocklehurst, Programmatic & Platforms Marketing Lead, Asia Pacific at Google, “If we look at India, the current penetration of programmatic is 41%, so India is ahead of many Asia Pacific markets already”. Therefore, the Programmatic industry in India shows a lot of promise to the marketers.
The structural changes that have occurred in the last couple of years could lead to a more positive projection in the years to come. Indian digital market hasn’t realized its full potential, but it is definitely moving in the right direction. The new display advertising trends, Programmatic, Video and Mobile will continue to attract even more advertising investment into Indian digital market and will continue to transform the customer experience.
Our company, Adoppler, is sincerely interested in the digital market boom in India, as our programmatic platform can be a great solution for those marketers who want to be up front in buying and selling digital media. The platform supports all the aforementioned media formats, including both Mobile and Desktop, Video and Native advertising. It can be easily integrated with any SSP and DSP as well as other management systems. To know more about the product, please visit adoppler.com