Give us a reality check on online advertising in India?
Online advertising in India is now over five years old but the base of advertisers is still tiny, attracting less than 2 per cent of annual advertising spend.
Although industry growth rate is 60-100 per cent, there is inconsistency in media consumption versus online spend percentage. Interestingly, while India is fifth in the world for Internet usage, it has very low penetration of 3.5 per cent.
Which industries are more comfortable with online advertising and marketing?
Three verticals "" retail financial services, online classifieds and e-commerce, and online travel portals "" make up 80 per cent of the Rs 240 crore online spend (2006).
Most online marketers are still guided only by commercial objectives. There's very little effort made to use the medium to build brand salience, and that's why you'll find few active FMCG players, for example.
Which are the most popular marketing models for acquiring customers on the Net?
Banner or display marketing is the most developed in India. Search marketing is a growing preference and Google accounts for 70-80 per cent search advertising by volume and 95 per cent by revenue.
Email marketing has a lot of negative perceptions due to problems with spam, but this is mostly because there are no credible third-party databases available. We manage end-to-end applications of email marketing. Affiliate marketing is a new element that we're the first to introduce in India.
What is affiliate marketing?
Globally, affiliate marketing accounts for 25 per cent of all online spend. Affiliate marketing is basically using one site to drive traffic to another; an affiliate programme rewards each publisher for every visitor and/or sale provided through its efforts.
A site like Yahoo shopping is based entirely on aggregating feeds from affiliates and then referring traffic. We are happy to evangelise affiliate marketing in India and make sure that by 2009 it will account for 10 per cent of total spend.
How do you make provisions for delivering ROI (return on investment) to advertisers?
The Internet as a medium allows for the most specific and callibrated measurement of CPA (cost per action) and ROI, which is fundamental to maximising opportunity.
Offline agencies don't understand the Internet enough and online agencies use sub-optimal tools and technologies to deliver sub-optimal results. We offer proven traffic source intelligence such as user journeys, traffic source, tracking multiple referers, retention rates per day, even what browsers users are using.
More and more advertisers are demanding transparent ROI delivery from online advertising.
What is your India game plan?
We have already signed on advertisers like Yatra, Sify and Naukri. There is tremendous potential here. Ninety per cent of online advertising revenue goes to the top 8-10 portals and 30-40 per cent of advertising deals happen entirely between advertisers and publishers.
The arrival of players like us and media buyers and planners will lead to greater economies of scale.