If you wished to check out the latest cricket score on one of the many popular Indian portals, chances are you would have had to negotiate a maze of pop-ups before getting to read the scorecard.
The online advertising dream which sunk the fortunes of many an Indian dotcom is making a sober, yet strong comeback. In the last one year the advertising revenues of leading portals in India such as Rediff, MSN, Yahoo! and Indiatimes have more than doubled making the online advertising a Rs 80 crore (Rs 800 million) a year business.
Mediaturf, a specialist online media buying agency, which has a tie-up with larger traditional media buying houses such as WPP's Mindshare, and Initiative Media, expects online advertising to touch Rs 200 crore (Rs 2 billion) by 2007.
A host of financial services, durables, automobile and IT companies are increasing their spends on the web to reach out to a more focused and affluent group of consumers.
"Our revenues from advertising have shown a 100 per cent growth since last year and the trend would continue for the next few years as well," said Rajneesh, head (marketing and strategic business development) MSN India. The list advertisers on MSN India has swelled to 60 in the last six months.
At present financial services and insurance companies such as ICICI Bank, Citi Group, ING Vysya and HSBC make up for nearly 50 per cent of the adspends on the net.
"Automobile companies such as Maruti and even the department of tourism are spending a lot on the Internet," said Rathish Nair, chief operating officer, Mediaturf.
Yahoo! India too claimed that its earnings from selling space on the net have doubled over last year. "We would easily have about 25 per cent share of the online advertising market. Marketers are realising that the Internet provides a greater reach in the SEC A1 and A2 households,' said Neville Taraporevala, CEO Yahoo! India.
According to an ICICI Bank executive, online advertising provides a lower cost per customer contact than mass media advertising and even the conversion rates are better.
The current Internet userbase in India is 28 million which is estimated to go up to 100 million by 2010, making the country the third largest Internet user market.
"In developed markets, online advertising contributes 2-3 per cent of the overall media pie. Every single Internet user accounts for $1 spending. In India, the adspend per Internet user is just about 50 cents and in the next few years the per user monetisation will go up to the levels of the developed markets with the proliferation of broadband, which will open up far greater advertising options like streaming for the marketers," said Rajneesh.
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