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PMMAO 2007: Internet: Online Advertising skewed in favour of financial services

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Due to the growing appeal of the Internet beyond the metros and SEC A, the Internet userbase is fast becoming diverse and therefore an essential part of media plans. Interactivity, focused targeting, cost-efficiencies are some of the other advantages.

The Pitch-Madison Media AdOutlook 2007 puts the Internet advertising at Rs 165 crore in 2006, up from Rs 110 crore in 2005, a growth of 50 per cent, cornering 1.1 percent of the total ad pie. The y-o-y growth has been around 50 percent since 2004. The increasing popularity of the Internet as a medium of choice for consumers is now making its presence felt in India. With around 38 million Internet users (“Ever” users according to I-Cube, the IAMAI-IMRB study) in the country today, marketers are realising that the Internet is a medium which needs to figure in their media plans. At the same time, the profile of Internet advertisers in India is still skewed in favour of financial services with FMCG and durables still being limited participants. This is likely to shift in the coming years especially with the era of e-tailing, but for now according to IAMAI figures, financial services accounted for 24 percent of Internet advertising, travel was the second sector with 12 percent. Technology, automobile and online services contributed 11 percent each. Durables, FMCG, telecom and entertainment were  major spenders.

I-Cube reveals that every second PC user in India has experienced the Internet and this creates a “critical mass for rapid growth”. Also, marketers’ find it heartening that the small town user is getting onto the Internet bandwagon in a big way, and now comprises of 39 per cent of the net users and the same is the case with the lower SECs which are adopting the Internet rapidly. Other areas like Search Engine Marketing are further fueling the growth with companies like Pinstorm leading the way.

Mahesh Murthy of Pinstorm says, “45,000 companies are doing SEM compared to 5,000 which do TV advertising.” With the eventual advent of broadband in a big way, it is obvious that more consumers would be on the Internet highway as mobile-Internet convergence is going to add another dimension to the story. Overall, one can say online advertising will continue to grow at a rapid pace and in the coming year will see a newer profile of advertisers entering this space.

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Neeta Nair

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