NEW DELHI, October 27
The market is booming. And Internet advertising is finally taking off. With a lot of hiccups, nonetheless. The Indian Market Research Bureau (IMRB), one of India's premier market research agencies, has carried out a survey on online advertising.
The intrepid researchers of the MR agency visited 21,000 homes and businesses. These included 8,000 businesses, across 16 cities across the country. And there were interviews with nearly 18,000 people.
The research results are divided into five separate groups — "what you see is what you got (WYSIWYG)," the ISP market, the content market, the e-commerce market, and the cyber café market. For the last section, IMRB researchers studied not only major ISP providers like Satyam and Mantra online, but also trudged to remote villages to study government provided cyber cafes as well.
The findings? Interesting. Of the 18,000 people that IMRB talked to, 13,000 were Internet users. So did that mean online advertising was the future?
Not really. Only the heavy users of the Internet were able to specifically recall advertisements on the Net. Others just had vague memories. Interestingly, hoardings offline, that is, at bus stops, and on billboards had better recall value. Perhaps one reason why major Internet companies are advertising at the bus stop!
Internet advertising, by recall value, came fourth. After magazines, televisions, hoardings offline. The effectiveness of Internet advertising also differed according to the product. Specific products, addressed at the computer industry, were more likely to get clicked on. These included hardware, software, and ISPs. On an average, for every one million people, 14 per cent surf the Net. Of these, only one-third were heavy users who might click on an ad online. "There must be something compelling, or an online ad is in the same league as a hoarding," says Mohan Krishnan, research director, e-technology group@IMRB.
And the exponential growth of the Internet alone will not take care of this, according to analysts. Not that the growth is lacking. Last year, Internet connections exploded by 151 per cent over the previous year. The business market grew by 118 per cent, while the home market grew by a whopping 205 per cent, according to the IMRB. In February 2000, NASSCOM estimated that there were 3.2 million web users in India, and that they were growing at 50 per cent every year.
In spite of all this, Internet advertising remains in its infancy. The problem lies in the way that the Internet is seen and used. Regarding the former, people still prefer TV ads to Internet ads, which have to get over the trash label. Another inhibiting factor is that many people use the Internet only to e-mail or chat, and not as a source of information. As Internet usage is relatively more expensive, and most surf in cafes, it will take a really compelling advertisement, targeted at exactly the same time as when the surfer is interested in the product, to get clicks.
Broadband could change this, with advertisements being interspersed between video clips. In one way, this is going back to the logic of TV, where the viewer has no control over the content. That is, unless you zap the remote. Yet say analysts, such technology would take a minimum of three years to show returns in the form of advertising impact.
In spite of all this, online advertising firms are upbeat. Take RightServe, which was started last year by Hughes Software Systems. Last October, RightServe conceptualised India's first targeted advertising campaign for Cyber India Online. The company sees a major market for online advertising support and intends to tap this by providing user-specific information. "RightServe's strength lies in its superior strategic skill base, cutting edge technological pedigree and efficient eye-ball expertise," says Sanjeev Gadre, business manager in charge of RightServe, at HSS, Bangalore.
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