Chinese Madhouse looks to wow India

15 Feb,2012

 

By Johnson Napier

 

Countless comparisons could be drawn on how two of the biggest and most admired economies are driving brands from all across the world to be a part of a growth story that is unparelled. Or how the APAC region is all about just these two economies today, putting the other developed nations in the region in a state of oblivion. Having wowed the world with growth stories that defy market odds, China and India today command attention from business stalwarts and entrepreneurs like no other, especially entrepreneurs from emerging mediums like Digital and Mobile that are shaping the way the world goes about doing its business. But despite the huge buzz around these two economies, there is very little that transpires when it comes to the two economies trying to venture into each other’s territory to gain mileage and expand base – especially in the digital space.

 

But all that could change with the advent of the largest mobile solutions and advertising network firm from China- Madhouse. Launched in 2006, the company enjoys the reputation of being tagged as the most intellectual and largest mobile ad solutions company in China. In India, Madhouse will work towards providing brands, advertising and media agencies and marketers with a host of comprehensive mobile marketing solutions. It has already tied up with a host of strategic partners including WPP, Vivaki, Omnicom, Aegis and so on from the media agency side of the business and would work towards providing them holistic mobile marketing and advertising network solutions.

 

The Madhouse India team would be headed by Vinod Thadani, who until now was handling mobile responsibilities for Group M India andSouth Asia. Given that the two countries share market complexities that are similar in nature and have a population base that is very high, it seemed like a natural extension for Madhouse to step in to India, making it the first such venture into foreign territory in APAC.

 

Throwing light on how the APAC market compares to the other regions and reacting on his choice of targeting India as the hub for launching the venture, Joshua Maa, Founder & CEO, Madhouse Inc. said: “Today APAC occupies ad spends growth to the tune of 32 per cent, making it the largest in the world. These are led by the economies of China , India and Indonesia that are the key drivers of this growth in APAC. To gain success in a market like India requires the ability to manage complexity, and this is an area where we excel.”

 

Hoping to leverage the opportunity of using mobile as a mass media device, Maa went on to elaborate the business module by stating: “If you compare the mobile markets of India and China, they are almost identical. While China has a mobile user base of 960 million, India’s number stands at 894 million. But where mobile internet users are concerned, China has 356 million users while India’s number stands at 150 million. Therefore, we foresee a huge growth in India and decided to make this our first market to launch in APAC.”

 

In India, the agency’s focus would be centred around disciplines of mobile ad serving, mobile ad network and mobile marketing solutions. Having wowed clients in China like HP, KFC, Unilever, Intel, Coke, and others, Maa hopes to emulate a similar example here by getting important brands to align with the network: “Being the only full-service provider in the market and having a skilled and experienced team in place, we hope to attract a lot of clients in the days to come.”

 

Emphasising on the partnership, Vinod Thadani, COO, Madhouse said: “Madhouse will offer mobile marketing solutions created and carried out for advertisers by a team of experienced media professionals that understand this medium. On a technical level, mobile advertising can now achieve accurate intelligent targeting and provide real-time reporting – a very convincing proposition for advertisers.” According to Thadani, the need of the hour is to unlock the potential of the mobile medium and they are therefore determined to grow the Indian Digital Media market from Rs125 crores to Rs1,000 crores in the next 3 years. “The need of the hour is to understand the medium thoroughly and this would be possible by partnering with the right partners and going back with the right solutions to clients.”

 

Perhaps the best reason for elation among mobile clients in India was provided by Ranjan Kapur, Country Manager, WPP, who began by discussing how India, as an advertising market, was highly undervalued. “Despite India boasting such a good growth in economy, the advertising spends in China stand at US $55 billion while for India it is at US $6 billion, this shows that we are still an under-advertised and under-branded market.” Citing the reason for China leapfrogging ahead of India, Kapur said that the single biggest factor for India’s dismal record in getting more ad spends was because it jumped on to the services bandwagon and chose to ignore the manufacturing sector. “While the Services sector contributes about 55 per cent to the GDP growth, it is still very shy on spending on marketing and promotional activities. And this is an area where Manufacturing excels. But all that is changing and the Services industry is opening up and spending more.”

 

On the ad spends growth in India, Kapur said that while there is a 15-20 per cent growth, it is digital that is intriguing the advertisers the most. “Digital ad spends recorded a growth of 30 per cent.Mobile, specifically, is a Rs125 crore industry today and given that there are 300 million internet users predicted by 2015, mobile advertising is expected to account for about one-fourth of conventional traditional advertising. So it can be said that a revolution in digital in India is beginning to happen now.” This growth will be boosted further by the Government’s efforts to spread mobile and internet usage in rural areas for which it has promised 2,50,000 nodes for broadband in the next four years. “So mobile marketing in the rural areas will be a mass phenomenon, once this plan gains momentum.”

 

Another interesting addition to the venture would be Rovio Entertainment that is more popular for its Angry Birds concept around the world. “Madhouse is a valuable partner for us in China , and we are excited about the opportunity to extend our collaboration to India as well,” said Bijay Gurung, Key Account Director, Rovio Entertainment Ltd. “With India being the second largest Facebook market, it opens the door for us to entertain even more fans as we are aiming for one billion downloads by the end of the year.” The current number stands at 700 million. Apart from that, Rovio would also focus on pushing itself as a publishing firm, a large-scale animations firm and further look to enhance its merchandise business.

 

In an era where it is becoming difficult to lead lives without smartphones, iPads and other such mobile gizmos and with a lot left to be accomplished in the Data, Voice and Text domain and lack of established tools and systems that makes it difficult to answer the question of how this medium can be leveraged by advertisers to reach out to their consumers, probably an established Chinese mobile dragon could well show Indian mobile companies the way this medium could be harnessed to its full potential.

 

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