Few days ago Juxt+WebChutney released the Digital Outlook 2009 report. I must thank and congratulate Juxt and Webchutney folks in compiling a lot of data and presenting it in a very professional way. It gives us publishers a lot of insight. Thank you folks!
I have extracted the parts which I found relevant for my work (Oneindia)
- Total ad spend in India: $4 billion (Rs 19,400 crore)
- Penetration: Internet penetration 4.2%, TV 50%, Print 20%
- Allocation of online expenditure was about 5.4% in 2008-09, expected to increase to 10% in 2009-10
- Ultimate aim of online communication should be to stay ‘top of mind’
- Online spend by consumer goods companies to increase by 300% from Rs 16 crore in 2008-09
- Thru online advertising you can reach 4% of Indians or 11% of urban consumers (this should be seen as good news as there is a lot of room for growth)
2008-09 / 2009-10 ad spend pie,
- TV – Rs 2,652.5 crore (51.4%) / Rs 2,273.44 crore (48.9%)
- Print – Rs 1,415.44 crore (27.4%) / Rs 1,194.68 crore (25.7%)
- Internet Rs 278.15 crore (5.4%) / Rs 399.38 (8.6%)
- Radio – Rs 48.81 crore (0.9%) / Rs 111.57 crore (2.4%)
- Others – Rs 768.35 crore (14.9%) / Rs 673.91 crore (14.5%)
Digital Ad Spend Pie
Most of us assume revenues from portals are from banner ads (other than ecommerce). Page 17 explains this in detail. The digital ad spend pie is divided into,
- Ad networks – 15%
- Display Ads – 14%
- Social media initiatives – 13%
- Develop/maintain promotional websites – 13%
- Electronic direct mailers – 12%
- Viral ads – 5%
- Mobile & others – 2%
About 34% is spent on advertising through pure display ads, viral ads and ad networks. Assuming the same split applies for 2009 the revenues from advertising would be Rs 94.5 crore (2008) and Rs 135.78 crore (2009).
For us at Oneindia.in #1, #2 and #5 are relevant.
Will the Online Ad Revenue Grow? Yes, of course!
There are two ways to see these numbers – oh my god! the ad revenue is way too small in India. Time to get out of this business . Or, there seems to be a lot of room for growth, let us push for it. Which one would you choose?
Yes, we seem to have an internet penetration problem. Unfortunately only the telcos and the govt can fix it. Not the publishers. We publishers can only try to keep improving the quality of the content/product.
Will we see an increase in internet users in India? According to CII India will have 695 million internet users by 2014. Jai Ho!
Irrespective of what the report says each publisher (like Oneindia.in) has to continue to work hard. We cannot bank on positive and negative reports. We got to excel in what we do, we cannot do much about what is not in our control (penetration, PC cost)