@FF12: Turning 3 into 10, a percentage issue for digital

19 Mar,2012

By A Correspondent

 

While much of the adex growth in 2011 came from the obvious sectors of television and print, it was digital that stole the thunder by recording the biggest and fastest growth among all mediums. Little wonder then that the session on “Innovations in the advertising industry in the Digital world” chose to focus on why the much sought after medium was still ignored by advertisers who preferred to seek refuge elsewhere. The panellists comprised Rajan Anandan, VP and MD Google India, Olivier Fleurot, CEO, MSL (Part of Publicis group), Frederic Josue, Executive Director, Havas Media, Vikram Sakhuja, CEO, South Asia, Group M and Kapil Agarwal, Jt MD, UFO Moviez and Varun Gupta, Director, strategy transaction services, KPMG India. The session was moderated by Rajiv Makhni, Managing Editor, Technology, NDTV.

 

Mr Anandan initiated the discussion, stating that India is still an emerging market where web advertising is concerned and it still constitutes about 3 per cent of the overall advertising spends in India which is estimated to be around Rs 33,000 crore. The biggest driver of growth in advertising on the web would be through the rise in the number of users of smartphones, which is estimated to touch 100 million users in 4-5 years time. Smartphones alone could boost the growth of web advertising to about 8-10 per cent, he said.

 

Mr Josue of Havas was of the view that it would be content that will drive the growth of the medium in the years to come. Havas has been at the forefront in investing behind content production as that would be the driver of growth for this medium. But the medium will face its share of issues which include multi-tasking across various platforms as an attempt will be have to be made to offer content seamlessly across various mediums. Also, engagement and loyalty would be the other key attributes that would make or break business for users of digital across the world, he said.

 

Mr Fleurot began by stating how the marketing and communications industry was witnessing a profound disruption due to the invasion of technology and social media. This, he said, has led to an increased level of competition in the marketplace. Signalling the essence that data will bear on the survival of players in the communications space, Mr Fleurot said that big data will be at the core of all marketing initiatives in the future. He highlighted on how the space will see the emergence of many new publishers like Youtube et al that will challenge the livelihood of the existing players in the space. The challenge, he said, was that clients today are not yet organised for the 21st century as they still prefer to work in silos. But in the case of online, the model of working in silos will disappear as all the other mediums work as a single unit on the internet. Going forward, the two key factors that will determine the growth of this medium, he said, include the speed with which marketers communicate with their users through the digital medium and the transparency with which they operate on the medium.

 

Vikram Sakhuja was at his jingoistic best as he began by questioning what the term innovation in advertising actually stood for. “Innovation is a term that is broader than creativity. It is a new way of doing something better,” he said. He outlined the current scenario by stating that technology today is an overestimated medium in the short term but is underestimated for the long term. The problem according to him is that the medium has been underestimated for a long time now and that it was about time the medium leapfrogged ahead of the others – go from the current 3 to 15 percent in the shortest possible timeframe.

 

Outlining the four fundamental powers of digital, Mr Sakhuja said that the first and foremost is its ability to move from being something random to attaining a consensus. The second was the power of interactivity which includes communicating in a 2-way mechanism and communicating in a social world; the third was the ability to move seamlessly across devices and lastly, the ability to enhance real-time consumption of content.

 

The implications that this would have on marketing include facilitating superior targeting, marketing content that would be more UGC-led, more use of apps and videos that will alter the way clients reach out to users – 30 second ads will make way for UGC videos and banner ads; use of word of mouth will see a predominant rise, and new sales and distribution models will evolve in digital that would enable advertisers to reach out to consumers in a more linear fashion.

 

Mr Gupta of KPMG pointed out though digital was seeing an increasing levels of penetration, there was a disconnect where ad spends on the medium are concerned. Just 3 per cent of monies going to the medium is still unreasonable given the numbers being thrown up by markets in the West and Europe, which exceed 25 per cent and above. A large amount of growth in digital will come through mobile, he said.

 

Mr Anandan added here that one of the industries that will see a downfall would be print as already there is a lot of transition that is being witnessed in terms of clients moving away from print to digital. Real estate clients and job classifieds are prominent examples where most of the ads are now being run on the digital medium putting the scope of print in a tight spot.

 

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