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You would be shocked to know that in 2008-09 advertisers spent Rs. 51663 million. Now just think of calculating the amount of extra money that you paid for product/services which compensates for advertisement and promotion spending?
Have you ever calculated the time that you devote online vis-à-vis watching television or listening to radio or say watching a print ad? Or has it changed over a period of time from traditional media to digital media? Out of the total advertisement spending, about 5.4% was taken up by Internet advertising, 51.4% and 27.4% by televsion and print respectively. But the interesting fact is that digital media is set to grow from approx Rs. 800 crore by whopping 44% in the next year, while the rest is expected to fall by 10%. Try to analyse the reason for the expected rise in figures. (Food for thought: rising service sector, rising young adults, increasing social networking portal, increasing visibility, higher accountability, easier to calculate ROI and what more…)
And is the allocation and growth figure similar for each and every sector or how much is the disparity among sectors? Just look at the chart shown above and try to anlayze the reason for the disparity. (figures are in Rs. million)
But one cannot deny the fact that every solution has a flip side to it. So what about the ethical issues associated with it? Moreover, keeping into consideration the wide difference in the reach of internet users and number of mobile subscribers, online advertisement might have a tough competition with mobile advertisement.
Share your thought on it for one day you could also be in a dilemma on the proportion of advertisement spending through different channels.
Reason for expected rise in the figures of advertising expenditure can be increasing competition. As internet is slowly penetrating into the core of the country, companies are coming forward for expenditures as it felt that more the brand recall, higher would be the purchases.
ReplyDeleteAs a point is also mentioned in the suggestion, there is a rise of young population which prefers to spend their leisure time surfing the net instead of outdoor games as was the past trend, there is an increase in the users and hence companies are trying to utilize the first mover advantage.
Another thought can be change in lifestyle. As in my case, i've started booking tickets through internet instead of waiting in the railway reservation office queue couple of years ago. Similarly, people are becoming aware of the power of internet and the convenience it offers and therefore are using more of internet for similar purposes.
Now think about those FMCG, electronics, BFSI companies which are trying to rope into rural population. Then is it feasible to put in extra money to TV and radio, keeping in mind the internet penetration. And don't you think if you go out and see the big hoarding, it would have a more brand capturing. And till date just try to identify the proportion in service sector or the young adults who find comfortable buying online, not only railway ticket but think about other merchandise as well. DOn't you think the touch and feel products are still missing the online sale? How to cater to that?
ReplyDeleteVery true. Radio is the deepest penetrated rural market media. And touch and feel products are better off in countries like India and therefore Dell is also coming out with its retail stores, unlike in other countries, a s they feel the power of touch and feel in Indian market. But as I have mentioned in the first post, internet, although not highly penetrated and having very less users as compared to countries like China, it is poised to become the future and therefore companies are taking the first mover advantage.
ReplyDeleteAs shown in the graph, FMCG is second least in spending on online advertising as they are aware that the revenue they generate would be negligible or even negative, and I don't feel anyone would interested in a soap ad online.
Although touch and feel still holds good for India, but as western market don't use it much to that extent, it is a possibility that India will also follow them as we do!
But the mere thought of online advertisement forces me to think that is customization just a theoretical concept and are the companies diverting from micro marketing to mass marketing, if we see that in the future internet is going to bring the next revolution in terms of reach and exposure. And how much %age increase in demand would there for be designers who specializes in Web 2.0 advertisement?
ReplyDeleteIn my opinion, online advertisement not only includes the ads that we see in the web pages but also in the e mails which again is a personal marketing.
ReplyDeleteI dont know would be the %age increase in the demand of the Web 2.0 advertisement, but surely there will be an increase.
You are right Gaurav...
ReplyDeleteWIth the onset of networking sites, online advertisement industry is set to grow by leaps and bounds and it may even grow at a faster than the figures quoted by you
And we also need to consider that since the companies are trying to penetrate into Tier I and tier II cities , would the online advertising be used as a communication way in those places, considering the cultural factors. Or in the ear future there would be portal developed by these companies which would be specifically focussed on advertisement, where people would come to know whether there is any new offering in their city.
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