Mobile is more flexible than TV, which makes it cheaper. What an advertiser spends per impression on mobile is much less than any other medium, Srikanth Kakani & Preetesh Chouhan tell Rajarshi Bhattacharjee
You have successfully executed monetising of the ICC website earlier this year. However, it is evident today that the mobile apps have fared better than mobile webs. Where does that leave advertising on mobile web?
Srikanth Kakani: We have the technological advantage that works across boards. Even if a mobile website is attracting only 30 or 40 per cent traffic against the app, the volume counts. This 30 or 40 per cent share is an opportunity a publisher can't ignore. Our video technology is based on .Vdo (pronounced dot vdo) which can be integrated with all video formats. In fact, our app integrations are easier than other app integrations for video advertising. This leads to saving a lot of money by the publisher when they are launching the app. On a regular basis, it also saves a lot of money for a publisher. The trends in app and mobile webs don't affect us in our business approach.
The data pack ecosystem continues to be poor in India. Also, given the fact that mobile advertising is less than 4 per cent of the overall advertisement pie in India, what is the kind of consumer attention you are looking at?
Preetesh Chouhan: Bandwidth and infrastructure are key issues. In contrast to 2012 Q4, all the key telecom players are slashing their 3G rates by 60-70 per cent now, followed by telecom players recently announcing that on-the-go 3G charges are going to be down by another 80 per cent. These developments will make way for scale. India is predominantly a 2G market. And here's the beauty of .Vdo technology. This patented technology allows video advertising to happen seamlessly over 2G and 3G mobile devices. And the quality of the video output is same in both 2G and 3G. How? Technically speaking, it's frame-rate-per-second that gets deferred.
Mobile handsets are coming closer to Rs 6,000 price bracket, data packs are coming bundled in the phone, and it's penetration in Tier-II and Tier-III cities is also poised to happen. The conversion from feature phone to smartphone is happening at the rate of 40 per cent annually. At the end of 2014, India will already have 100 million smartphones with data packet and video capability. When the market will explode at this speed, the direction of monetisation or the marketing-dollar spend will also have to move in that track. Are we ready? The answer is yes.
In India video advertising is still evolving. How are you convincing the advertisers to take it seriously?
Kakani: It is the figures that convince the advertisers. The number of people you can reach through mobile and online is huge. Consider mobile TV. By the end of 2012, the entire mobile TV ecosystem in India, if I just count the apps, was not even $1 million. However, by the third quarter of 2013, it stands at $10 million. Advertisers cannot ignore it.
Mobile is more flexible than other mediums, which makes it cheaper - not because an advertiser is going to spend less money, but what he spends per impression in mobile is much less than any other medium.
Chouhan: Advertisers are convinced when they see the figures. On an average, 43 per cent of Vdopia users watch complete video ads. Some of the top players in this market don't even have this 'completion rate' above 20 per cent. Here, consider the new Ford Ecospot car - that has seen a successful launch in India, now witnessing almost six months waiting before delivery. Have you seen any TV ad around it? No. It's only launched in the digital medium.
Kakani: How do you know if a TV ad is seen by the audience? You don't know, but in digital you know. Television may be a popular platform for advertisements, but I will not believe it unless analytics or data support the claim. TV advertising is fiction, because there's no analytics to support what it claims. People think it works, but probably it does not work even 10 per cent of what people give it a credit for. Yes, it's a bold statement to make, but it's true.
What determines the success/failure of the mobile video advertising?
Kakani: There are a lot of things that determine the success or failure of mobile video ads. But everything boils down to measuring and connecting oneself. In some cases it's the creative - content, interactivity etc, in some cases it's the sheer reach. For instance, if you wish to sell a luxury car to a TV audience, you are going to waste 99 per cent of the impressions you are going to run on the TV. A prospective buyer of a luxury car spends more time in a golf tournament or in-flight entertainment than television. Mobile is the best option to reach such target audience.
Chouhan: You may also ask, how are we communicating the advantage of mobile video advertisements. One of the key areas I would like to emphasise here is our VMI series (Vdopia Mobile Insights). We have realised the need for communicating with the outer world with regard to what we are doing, how that is beneficial and how that can build an eco-system. VMI is going to be one of our product differentiator.
Strategies for monetising may vary with different applications. How do you monetise apps, say for the television show Comedy Nights with Kapil?
Chouhan: In monetising app of a TV show, the first area is acquisition of the app. This means not buying it but partnering with the content owner. Our partnership with the content owner goes before the TV show Comedy Nights with Kapil became popular. Second is the app developer world. We have developed solutions that go to a lot of app developer ecosystems across the world and we integrate at the source itself. To understand this, consider yourself as an app developer and who loves building games. Once you have built an app, go to our website and download our SDKs (software development kits) which are a bunch of codes for the app and put the app in an app store. As people start playing the game, the ads are served and the app developer starts earning. But why Comedy Nights with Kapil and not a movie? Because in mobile, TV content is more popular than movies.
As an organisation we don't trade, but add value. We recognise that value and help publishers integrate and monetise better.
|ON THE GO|